Volume 680 Week 13 - Tuesday 12 June 2012 
Text is incorporated into the Bound Volume 
Volume 680 Week 13 - Tuesday 12 June 2012 
[Sitting date: 12 June 2012. Volume:680;Page:2799. Text is incorporated into the Bound Volume.] 
Tuesday 12 June 2012 
Mr Speaker 
 took the Chair at 2 p.m. 
Prayers 
. 
Obituaries 
Rt Hon Sir Brian Edward Talboys CH KCB AC 
Mr SPEAKER 
: Honourable members I regret to inform the House of the death on 3 June 2012 of the Rt Hon Sir Brian Edward Talboys CH KCB AC and member of the Privy Council who represented the Wallace electorate from 1957 to 1981. From 1975 to 1981 he was Deputy Prime Minister Minister of Foreign Affairs and Minister of Overseas Trade. He held a number of other portfolios in his parliamentary career including Minister of Agriculture of Science of Education of Industries and Commerce and of National Development. I desire on behalf of this House to express our sense of the loss we have sustained and our sympathy with the relatives of the late former member. I now ask members to stand with me and observe a period of silence as a mark of respect for his memory. 
Honourable members stood as a mark of respect. 
Questions to Ministers 
Government Financial Position—Financial Statements for 10 Months Ended 30 April 2012 and IMF Report 
1. 
DAVID BENNETT (National—Hamilton East) 
 to the  
Minister of Finance 
: What reports has he received on the Government’s financial position? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 Last week Treasury published the financial statements for the 10 months ended 30 April. That shows an operating balance before gains and losses of about $1.4 billion better than forecast. Although this is encouraging it is only one set of monthly figures which fluctuate from month to month. The Government remains focused on spending discipline to stay on track to surplus in 2014-15 as we make a moderate adjustment compared with most countries back to surplus. 
David Bennett 
: How does the Government’s financial position compare with that of other countries? 
Hon BILL ENGLISH 
: Although we have had some tight Budgets that do require changes if we are going to produce more public services for less any number of other countries including Australia and Australian states are making much harsher adjustments to their public spending through reductions in family entitlements large-scale redundancies in their public services and a reduction of public services. We do not have to take those measures. 
David Bennett 
: What reports has he received endorsing the Government’s economic programme? 
Hon BILL ENGLISH 
: Last week the International Monetary Fund issued its report on New Zealand for 2012. It noted that if we get back to surplus by 2014-15 that would put New Zealand in a better position to deal with future shocks and take pressure off both interest rates and the exchange rate. It also noted that the New Zealand banking sector remains sound. By comparison with other countries this means we are in a fairly good position for moderate growth. 
David Bennett 
: What other approaches to managing the Government’s finances is he aware of? 
Hon BILL ENGLISH 
: I have seen a number of other reports around suggesting considerable extra Government spending—and of course that would have to be paid for by more Government debt—such as borrowing to pay for reducing the retirement age to 60 for many workers paying for the doubling of paid parental leave and bringing back the research and development tax credit. Those are all Labour Party policies. 
Rt Hon Winston Peters 
: In view of the turmoil in the eurozone and the serious implications for the New Zealand economy if the crisis deepens and further impacts the global financial markets and of Australia’s growth rate which was 300 percent higher than that of New Zealand as of March this year does he not consider it imperative that the Reserve Bank has the appropriate powers to deal with such a potentially dangerous macroeconomic condition? 
Hon BILL ENGLISH 
: That is I think a good question in the circumstances. I believe the Reserve Bank does have sufficient powers to deal with a very significantly negative international event. Those were tested unexpectedly back in 2008 and since then there has been considerable work done by the Reserve Bank both on its own capacities and on how they link with those of the Australian Reserve Bank and bank regulators and I think they are in reasonable shape to handle some significant negative event. 
Rt Hon Winston Peters 
: I seek leave of the House to have the Reserve Bank of New Zealand (Amending Primary Function of Bank) Amendment Bill which is in my name drawn from the members’ bills ballot and introduced to the House following question time today. 
Mr SPEAKER 
: Leave is sought for that course of action. Is there any objection? There is objection. 
Schools Class Sizes—Teacher to Pupil Ratios 
2. 
DAVID SHEARER (Leader of the Opposition) 
 to the  
Prime Minister 
: Does he stand by all his statements? 
Rt Hon JOHN KEY (Prime Minister) 
: 
 Yes. 
David Shearer 
: Does he think that the policy to increase class sizes was “not wrong”? 
Rt Hon JOHN KEY 
: I think it had great merit if the money was going to be used to improve teacher quality. Clearly New Zealand parents did not agree with that. I do note that when David Shearer gave a speech earlier in the year lording it about the problems with education the first thing he said was “We need every teacher in our classrooms to be a good one. The vast majority are but the truth is some are not.” This Government was prepared to tackle that issue; that Opposition is not. 
David Shearer 
: Does he think therefore that parents are wrong when they believe that smaller class sizes are beneficial for their child’s education? 
Rt Hon JOHN KEY 
: No. 
David Shearer 
: Do the savings that were to be made from increasing class sizes still need to be found and from which vote will they come—education or elsewhere? 
Rt Hon JOHN KEY 
: Ideally yes. Yes they will be found from education but if they cannot they will be parked up against the new Budget spending allowance for 2013. 
David Shearer 
: Was he aware of the effect of increasing class sizes on intermediate schools before either the Budget announcement or the Minister’s pre-Budget announcement? 
Rt Hon JOHN KEY 
: I was aware that 90 percent of New Zealand schools would have a very modest adjustment—plus or minus one full-time teacher equivalent. I was aware that the other 10 percent would have a larger adjustment. And I was also aware that the ministry had a significant transition fund to take the rough edges off that transition. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. That was a very specific question very direct and not answered. [ 
Interruption 
]  
Mr SPEAKER 
: Order! The question if I recollect correctly asked specifically about intermediate schools the impact on intermediate schools. It was a direct question and asked whether the Prime Minister was aware of the impact on intermediate schools from memory. I think the right honourable Prime Minister should answer that. 
Rt Hon JOHN KEY 
: I was aware that some intermediate schools would be part of that 10 percent. 
Schools Class Sizes—Treasury Advice 
3. 
Rt Hon WINSTON PETERS (Leader—NZ First) 
 to the  
Minister of Finance 
: Does he have confidence in the advice he is receiving from the Treasury; if so why? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 Yes because Treasury gives its best advice based on experience of New Zealand conditions. But of course that does not mean the Government always agrees with Treasury advice. 
Rt Hon Winston Peters 
: How can he have confidence in the advice he is receiving from Treasury when in the words of the Prime Minister implementing such advice would cause “months of industrial action” and “huge amounts of anxiety from parents and children …”? 
Hon BILL ENGLISH 
: Given the choice between Treasury’s advice and the Prime Minister’s advice I would generally choose the Prime Minister’s advice. 
Rt Hon Winston Peters 
: That being the case is it not true that the Treasury 2011 briefing to the incoming Minister of Finance in particular the recommendation on page 4 in the executive summary to “improve educational attainment at lower cost” means that he and not the Minister of Education was the main instigator of this horrendously unpopular policy? 
Hon BILL ENGLISH 
: Ministers are under some pressure these days to ensure that they can meet the Government’s requirement for more public services for fewer resources. And as the Minister of Finance it is part of my job to make sure that Ministers understand the need to do that. I take my responsibility as part of the collective responsibility for all decisions that are made. 
Rt Hon Winston Peters 
: I raise a point of order Mr Speaker. I recited the date or the timing of a briefing paper and in particular its recommendations which suggest that the finance Minister and not the Minister of Education was the first recipient of that advice. And I am asking whether that does not make him the main instigator of this policy. He did not answer the question at all. 
Mr SPEAKER 
: Well the Minister I believe did give an answer. It may not have been quite the one the member was looking for but in his answer if I remember correctly he said he was involved in the matter. I accept that he did not go on to say whether he was the driver or not or the first person to push the policy but he said he was involved in the decision making with regard to the policy. 
Rt Hon Winston Peters 
: I raise a point of order Mr Speaker. I am not disputing what you are saying but he used the word “Minister” and I was not aware whether he was talking about the Minister of Education or himself. That is the confusing part of that answer. 
Mr SPEAKER 
: Order! I found his answer not confusing. I thought he was referring to himself in his answer if I remember correctly. 
Hon David Parker 
: Did the Secretary to the Treasury advise the Minister of Finance of his intention to give a speech promoting larger class sizes before he gave that speech? 
Hon BILL ENGLISH 
: I cannot recall whether he did or did not but he would have given the speech on the basis of the pretty clear evidence that has come out of extensive educational research and I would expect Treasury to advance policies based on sound evidence. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. Could you instigate an investigation—it is my understanding that all of the microphones in the House are live and are being broadcast and there have been some interesting things said on the other side. 
Mr SPEAKER 
: Order! I suggest that members if that is the case keep a little quieter. It is being dealt with at the moment but members should be aware that the microphones are all live and any interjection will be broadcast. We will do our best to get that remedied as soon as possible. 
Rt Hon Winston Peters 
: Did he instruct the Secretary to the Treasury to publicly advocate increasing class sizes in the  
Dominion Post 
 on 27 March 2012 and in the  
Listener 
 published on 24 March 2012; if so were Cabinet and the Prime Minister consulted? 
Hon BILL ENGLISH 
: The answer to the first question is no. The Government takes good ideas from anywhere: from Treasury from members of the public from Ministers and even from members of the Opposition. If it is a good enough idea we will have a listen to it and we might even try it out. 
Hon David Parker 
: How can the Minister have confidence in the Secretary to the Treasury when Treasury’s mismanagement of the Crown guarantee scheme caused additional avoidable losses to taxpayers of between $100 million and $500 million which the Secretary to the Treasury and no other arm of Government has inquired into to quantify? 
Hon BILL ENGLISH 
: We disagree with the member. His analysis is based on his misunderstanding of the deposit guarantee scheme. 
Oil and Gas Exploration—2012 Tenders for Permits 
4. 
JONATHAN YOUNG (National—New Plymouth) 
 to the  
Minister of Energy and Resources 
: What new opportunities for petroleum exploration in New Zealand have recently been opened? 
Hon PHIL HEATLEY (Minister of Energy and Resources) 
: 
 Last week I welcomed the opening of 23 new areas for oil and gas exploration around New Zealand. This is another important step towards realising the potential of our oil and gas resources. The Government is committed to long-term responsible management of our resources which will create jobs increase income and raise our standard of living. It may interest you to know that in Taranaki the industry has indirectly created over 5000 jobs and contributes $2 billion to the local economy each year. We want to see those benefits realised in other regions. 
Jonathan Young 
: What would the benefits of a significant discovery be to New Zealand’s economy? 
Hon PHIL HEATLEY 
: Recent reports released last year showed that New Zealand is set to earn more than $3 billion in royalties from oil and gas fields already in production. Given current strike rates if the current rate of exploration were to increase by 50 percent we could earn up to $12.7 billion in royalties over the life cycle of those projects. That is $12.7 billion that can be used for any number of things to improve the lives of New Zealanders whether it is schools new hospitals or roads. 
Superannuation—Entitlement Age 
5. 
DAVID SHEARER (Leader of the Opposition) 
 to the  
Prime Minister 
: Does he still stand by his statement that he would resign rather than change superannuation? 
Rt Hon JOHN KEY (Prime Minister) 
: 
 Yes. 
David Shearer 
: Does he stand by his statement: “With all due respect to the Retirement Commissioner there’s a lot of things on my plate I need to deal with in the here and now rather than things in 2020 and beyond.”? 
Rt Hon JOHN KEY 
: Yes. 
David Shearer 
: Why does he think that the retirement age is not a current issue when the Budget shows that spending on superannuation will exceed spending on education in just the forecast period? 
Rt Hon JOHN KEY 
: Of course superannuation is an issue but one thing that is worth noting is that increasing the age of eligibility has much less of an impact than commentators might imagine. For instance moving the age to 67 makes a difference of about 0.7 percent of GDP and that is not until 2030. So it is an issue but growing the economy and fixing some of the other issues we inherited from Labour are more significant. 
David Shearer 
: Does he understand that for most New Zealanders superannuation will be a significant part of their income as they age and that it is only fair to give them time to make those inevitable changes? 
Rt Hon JOHN KEY 
: Yes but that is why you need a National Government that will grow the economy and solve many of the problems that it inherited from Labour. Interestingly enough there was a chap on from the OECD this morning who made this statement and I quote: “I don’t think that New Zealand pensions are unaffordable in the sense that expenditure is still very much below the OECD average in the long term”—by which he means 2050. Even if there is no change by then it will be 8 percent of GDP compared with the OECD average which is 11.5 percent. 
David Shearer 
: Is it because he is governing for the immediate term and not the long term that he is pursuing policies such as freezing funding for early childhood education or selling off our State assets? 
Rt Hon JOHN KEY 
: No. We are delivering an economy that is growing. We have forecast growth rates to be higher than the eurozone UK Japan Canada and the United States over the next 3 years. But let us just understand one thing. Labour went to the last general election wanting a capital gains tax and raising the age of superannuation for one reason and one reason alone. It was not to claim the moral high ground; it was a catch-up with the spending promises Labour had made and it still has not learnt how to grow the economy.  
Accident Compensation Corporation—Confidence in Chair of Board and Management of Long-term Claimants 
6. 
KEVIN HAGUE (Green) 
 to the  
Minister for ACC 
: Does she have full trust and confidence in John Judge as ACC board chair and if her confidence is less than full what is she doing about that? 
Hon JUDITH COLLINS (Minister for ACC) 
: 
 Earlier today I announced that Mr Judge would remain as board chair until 30 June 2012. I would like to thank Mr Judge for the contribution he has made during his time as board chair and in particular for turning round ACC’s financial performance from the massive losses left by the previous Labour Government. 
Kevin Hague 
: I raise a point of order Mr Speaker. This question was a question on notice and although certainly events have perhaps overtaken some of the purpose of the question none the less the first part of the question asked whether or not the Minister had full trust and confidence in Mr Judge and she has declined to answer that. 
Mr SPEAKER 
: I think the member makes a valid point—that this was a question on notice. I think an answer more directed to the question on notice would be appropriate. 
Hon JUDITH COLLINS 
: Speaking to the first part of the question my having already answered the second part I had full trust and confidence that Mr Judge would see to ACC’s financial situation which he did. I however reserve judgment on the privacy issues until after the Privacy Commissioner and Auditor-General reports are available. 
Kevin Hague 
: Is the Minister concerned about the reports of multiple and repeated privacy breaches in ACC including private information being mistakenly sent to other claimants and health professionals and ACC’s claims management system being more or less transparent to anyone in ACC including information about sensitive claimants? 
Hon JUDITH COLLINS 
: Yes. 
Kevin Hague 
: Given reports of multiple and repeated breaches of good practice by ACC in its claims management will she ask the Office of the Auditor-General to bring forward the review of claims management scheduled for the 2013-14 financial year to address the widespread public concern about ACC’s practices? 
Hon JUDITH COLLINS 
: Well that is an issue that I will discuss and consider.  
Kevin Hague 
: Does she endorse the view expressed by Denise Cosgrove ACC’s General Manager of Claims Management that the organisation has been too focused on client needs?  
Hon JUDITH COLLINS 
: It is difficult to answer that given that I have never heard Ms Cosgrove make that sort of comment. But I want to make it very clear that I expect that ACC will treat all claimants as though they are claimants who have options as to where they can go for their assistance even though we know that under the ACC system they cannot. So I would like to see all claimants treated well professionally and with the utmost care. But I am also aware of the fact that there are from time to time situations where claimants may make false claims to ACC that it needs to do work on. But generally I expect an improvement in the culture.  
Kevin Hague 
: Is the Minister aware whether her predecessor in her role the Hon Dr Nick Smith approved the ACC decision to focus on limiting expenditure at the expense of a focus on client needs or was this purely a decision of the ACC board?  
Hon JUDITH COLLINS 
: I do not have that information to hand.  
Kevin Hague 
: Does she and did her predecessor in the role the Hon Dr Nick Smith endorse ACC’s decision to target people with long-term disabilities for what is termed in the insurance world actuarial release—in lay terms kicking people off earnings-related compensation—or was this purely a decision of the ACC board?  
Hon JUDITH COLLINS 
: It is difficult when you have a question like that which includes so many allegations to answer it as clearly as I would like. I am happy however to say to the member that actually I expect that ACC will in fact look at how it can bring people back to independence how it can get them back into work. I do not subscribe to the fact that everybody has to be able to get back into work. I do however believe that where people can it is absolutely in their best interests for them to get back into work because what we do know is that even with physical disabilities most New Zealanders want to work when they can and work is very good for them. It is also extremely good for mental health. 
Rt Hon Winston Peters 
: Relating to the primary question’s statement “what is she doing about that?” has the Minister expressed concern that an ACC claimant along with a former National Party President Michelle Boag attended a meeting with ACC officials that the claimant taped yet at no time offered in good faith to hand back to ACC the material the claimant had improperly received; if not why not? 
Hon JUDITH COLLINS 
: I have expressed concerns about that matter in the past but it is currently being reviewed by the Privacy Commissioner and the Auditor-General and I think that to comment further at this stage would be inappropriate.  
Hon Trevor Mallard 
: Is it her intention to apologise to Michelle Boag for giving the impression that Michelle Boag was involved in the extortion of ACC?  
Hon JUDITH COLLINS 
: I do not know why I would given that I have not made those sorts of statements.  
Mr SPEAKER 
: Kevin Hague—[ 
Interruption 
] Order! I have called Kevin Hague.  
Kevin Hague 
: Will the Minister instruct Paula Rebstock to return ACC to its original role as provider of compensation and full rehabilitation for injured New Zealanders and will she require the removal of ACC board members and senior staff who have presided over the culture of disentitlement since 2009?  
Hon JUDITH COLLINS 
: Perhaps the member is not aware that Ms Rebstock has been appointed as acting chair for only a matter of weeks rather than months and I believe that it is important to note that there will be further appointments to come and that would be more appropriate. But I also do not necessarily agree with the assumptions in that member’s question.  
Rt Hon Winston Peters 
: Is the Minister not concerned that a claimant attending a meeting with ACC officials along with the former National Party President Michelle Boag did not at any point in time offer to hand back the tapes which moved ACC to say: “When this matter is resolved will we get them back?”; is she not concerned about what that looks like or seems like in the proper conduct of public affairs? 
Hon JUDITH COLLINS 
: I have answered that question. I have previously expressed my concern about the allegations that were in the report provided to me and released on 16 March. However the matter is now subject to two investigations—one from the Privacy Commissioner and the other from the Auditor-General—and I do not think it is appropriate for me to wade in there and express my views when both of those agencies are independent and extremely capable of making their own investigations. 
Rt Hon Winston Peters 
: I raise a point of order Mr Speaker. Why is this Minister invoking the sub judice rule when it does not apply here? I am asking her straight out whether she thinks there is cause for the Minister to make it very clear as to her concern that a claimant with an adviser is withholding information improperly received and does not that go to the good faith of the claimant in the first place? 
Mr SPEAKER 
: Order! Well— 
Rt Hon Winston Peters 
: It is not a sub judice matter. 
Mr SPEAKER 
: No order! If one gets down to the nitty-gritty the Minister is not remotely responsible for the good faith of a claimant. The Minister could—and I am surprised in some ways that the Minister did not—simply say that she is not responsible for the actions of a claimant. She chose though to try to express her concern about the whole situation and what she is trying to do about it and that is fine. But the member asked a question over which the Minister has no ministerial responsibility at all. 
Rt Hon Winston Peters 
: I raise a point of order Mr Speaker. With respect you have taken the view that the claimant’s actions are not the Minister’s responsibility. I am saying that the officials’ actions are the responsibility of the Minister and were they not— 
Mr SPEAKER 
: Order! We are not— 
Rt Hon Winston Peters 
: —grievously mistreated? 
Mr SPEAKER 
: Order! We are not going to litigate this by way of point of order. The Minister did handle that part of it. She has expressed to the House her lack of complete satisfaction about the way the whole thing has been handled and I think in the circumstances given the question asked it was not an unreasonable answer. 
Kevin Hague 
: I seek leave to table two documents. The first is an ACC internal memorandum from Phil Riley the long-term claims project lead dated 16 February 2009 and entitled “Strategy for the Future Management of Long-term Claims”. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? There is no objection. 
Document by leave laid on the Table of the House. 
Kevin Hague 
: The second document I seek leave to table is a transcript of a presentation entitled “ACC—The Winds of Change” delivered by Denise Cosgrove and Darryl Frank to the Institute of Actuaries of Australia and it is dated 20-22 November 2011. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? There is no objection. 
Document by leave laid on the Table of the House. 
Maternity Services—Improvements and Increase in Midwife Numbers 
7. 
Dr JACKIE BLUE (National) 
 to the  
Minister of Health 
: What reports has he received on improvements to midwifery services? 
Hon TONY RYALL (Minister of Health) 
: 
 I have seen a report this morning reporting that more midwives are practising in New Zealand than ever before. The College of Midwives puts this increase down to stricter qualifications a mentoring programme for graduates and better staff retention. They also report that midwife numbers in rural areas are steady for the first time in years and I am very pleased to be able to report to the House that 176 midwifery graduates have been confirmed on the Voluntary Bonding Scheme to date. The 2012 registrations of interest are scheduled to open this Friday. Having said that there are still some pressure points around the country and district health boards continue to work on dealing with these. 
Dr Jackie Blue 
: What initiatives has the Government put in place to improve midwifery services? 
Hon TONY RYALL 
: The Government has put around $114 million extra into maternity services since 2008. We have had a very strong focus on quality and safety delivering better services for parents and babies. Last year the Government launched the maternity quality and safety programme and midwives have been attending workshops around the country to learn about these new quality and safety initiatives. Midwives obstetricians general practitioners and anaesthetists are working together in a way that we have not seen before to deliver better services to parents and babies. This is all part of the extra $2 billion that this Government has invested in our public health service since 2008. 
State-owned Energy Companies and Air New Zealand Sales—Government Policy 
8. 
Hon CLAYTON COSGROVE (Labour) 
 to the  
Minister for State Owned Enterprises 
: Is it his understanding that the Prime Minister is still committed to his policy of partial asset sales in Mighty River Power Genesis Power Meridian Energy Solid Energy and Air New Zealand? 
Hon TONY RYALL (Minister for State Owned Enterprises) 
: 
 Yes the Government remains committed to its policy of minority share offers in the mentioned enterprises but as indicated from the outset this is subject to market conditions. Although the member may have various reasons why this policy should not proceed I would want to emphasise that this policy is important for a number of reasons the most important being controlling our debt and protecting New Zealand from the worsening European and international debt crisis that fills our television news screens every night.  
Hon Clayton Cosgrove 
: Does he agree with the Prime Minister who on Radio Live yesterday said that he abandoned the increase in class sizes because “It’s pretty obvious that we weren’t winning that public debate.”; if so will he follow that same criterion and abandon State asset sales given that more than 80 percent of New Zealanders are opposed to those sales? 
Hon TONY RYALL 
: Yes; and no.  
Hon Clayton Cosgrove 
: Given that his colleague the Minister of Education stated on  
Campbell Live 
 this past Thursday that the increase in class sizes was abandoned because “This was a trade-off people were not prepared to make.” will he reconsider the policy of partial asset sales in Mighty River Power Genesis Energy Meridian Energy Solid Energy and Air New Zealand? 
Hon TONY RYALL 
: No. It is imperative that New Zealand take action to control its debt. The Government has a plan to ensure that and part of that is to sell minority shares in these State-owned enterprises. If we do not control our debt then New Zealand’s future will not be as successful as it could be.  
Hon Dr Nick Smith 
: What reports has he received on the previous Government in 2007 adopting the mixed-ownership model for State-owned energy companies and selling 49 percent of the shares in Spring Creek Mine Ltd for tens of millions of dollars all to a foreign-owned multinational company called Cargill Coal a policy that was described by the then Labour Government as innovative— 
Mr SPEAKER 
: Order! Members are meant to ask questions not make speeches.  
Hon TONY RYALL 
: I found that question most interesting because I have heard from the people opposite that they would not want to do anything like that. But it seems that when they are in Government it is a completely different story.  
Hon Clayton Cosgrove 
: To the Minister—[ 
Interruption 
]  
Mr SPEAKER 
: Order! I apologise—[ 
Interruption 
] Order! I want to hear the Hon Clayton Cosgrove’s supplementary question. 
Hon Clayton Cosgrove 
: Too much starch in the Y-fronts possibly.  
Mr SPEAKER 
: Order! 
Hon Clayton Cosgrove 
: Does he consider it acceptable that as noted on the public record his officials from Treasury wrote the departmental report on submissions on the Mixed Ownership Model Bill prior to submissions being fully heard? 
Hon TONY RYALL 
: I am aware that after the departmental report was received the committee heard I think 10 oral submissions nine of which were based on written submissions that were considered for the departmental report. I think the Finance and Expenditure Committee has done a very fine consideration of the bill and I thank all members for the very studious way that they have dealt with this bill.  
Hon Clayton Cosgrove 
: Was the Finance and Expenditure Committee acting on his instructions while considering the Mixed Ownership Model Bill—in particular when Government members gave inadequate time for consideration and deliberation and when National MPs were disrespectful to submitters including one who demanded to know the voting intention of a submitter? 
Hon TONY RYALL 
: Far be it from me to instruct the members of the Finance and Expenditure Committee some of whom are in the Labour Party the Green Party and all sorts of other parties.  
Student Loans—Debt Recovery from Overseas-based Borrowers 
9. 
SIMON O’CONNOR (National—Tamaki) 
 to the  
Minister for Tertiary Education Skills and Employment 
: How much overdue student loan debt has the Government recovered from overseas-based borrowers in the last two years? 
Hon STEVEN JOYCE (Minister for Tertiary Education Skills and Employment) 
: 
 I am pleased to report that the Government’s programme begun in October 2010 in pilot form to collect overdue student loan repayments from overseas-based borrowers has so far brought in $20 million with a further $2.9 million under payment arrangements. To date we have received about $12.20 for every dollar invested in collections which is good progress as overseas-based borrowers have tended to take considerably longer to pay off their loans. The initial pilot phase of this project has proven the worth of chasing student loan debtors who are overseas and not meeting their obligations—something it has to be said the previous Government did not bother to do. 
Simon O’Connor 
: What effect is this recovery programme having on the level of outstanding student loan debt? 
Hon STEVEN JOYCE 
: More than 6000 borrowers have now made repayments since the initiative began. In fact 18 of these borrowers have paid more than $50000 each. However the value of outstanding debt held by overseas-based borrowers remains a big problem which we are committed to tackling with the valuable help of our support partner the Minister of Revenue Peter Dunne. As at April 2012 borrowers living abroad had loans of more than $2.6 billion of which around $400 million is overdue for repayment. The Government will therefore continue to ramp up its plan for debt collection efforts to ensure those overseas borrowers meet their repayment obligations and help contribute to further investment in the tertiary education system that trained them.  
Question Time 
Mr SPEAKER 
: Colleagues before going to the next question can I just update you on the gremlins in the sound system. There is apparently a serious failure in the circuitry somewhere and there is a problem with both our television and our radio sound being delivered. We hope to fix that in the dinner break. But what you need to be aware of members is that although your microphones are working when you speak they are on full time. The Clerk’s and my microphones are not working too well but apparently yours are working very well. So just be alerted to that—that anything you say may well be broadcast. 
Family Court—Introduction of Fees for Civil Disputes 
10. 
CHARLES CHAUVEL (Labour) 
 to the  
Minister for Courts 
: What decrease if any in the use of the Family Court after 1 July is expected to result from his decision to introduce fees of $700 plus a daily hearing fee of $1812 for applications for divisions of assets and fees of $220 for childcare disputes both of which applications are at present fee-free? 
Hon CHESTER BORROWS (Minister for Courts) 
: 
 In answer to the question based on last year’s modelling there were 18000 applications before the court that would be liable for the payment of fees. About 8500 childcare disputes and about 1700 property disputes would be expected to pay the fees. The balance would be expected to avoid the fees either by applying to the registrar of the court for a waiver of which there is expected to be a significant number granted or by finding some other way to sort out the dispute and not come to the court.  
Charles Chauvel 
: What advice if any has he received on the risks to vulnerable children of introducing user-pays to a system that was deliberately designed to be fees-free in order to ensure that such children did not suffer as a result of the inability of their parents to pay a fee when trying to access the court? 
Hon CHESTER BORROWS 
: It is important to note that family violence matters such as seeking a protection order do not require fees and that those applications will be lodged free of charge as they are now.  
Charles Chauvel 
: What consultation took place with Family Court judges prior to his announcement that these fees would be introduced given that the dean of the Otago University law school said on the  
Nine to Noon  
show this morning that he had been told on Sunday by a Family Court judge that the Family Court judge was unaware of this decision? 
Hon CHESTER BORROWS 
: I am unsure why the commentator would make that comment bearing in mind that in September last year it was flagged that these fees could well be introduced ahead of the Family Court review being completed. I am unsure of precisely what consultation was had with Family Court judges or specifically which Family Court judges were consulted with. 
Charles Chauvel 
: Who is correct: Judith Collins when she said on 27 February that it was important to await the outcome of the Family Court review before progressing important decisions such as those around the Legal Assistance (Sustainability) Amendment Bill or he himself when he said on  
Morning Report  
this morning in respect of his decision to introduce these fees well before the outcome of the Family Court review is known “Quite honestly if we keep waiting and waiting … we’d never get anything done.”? 
Hon CHESTER BORROWS 
: The point is of course that people who are subject to this fees liability do not have to come before the court. There is always the opportunity of them getting around the table with their lawyers or other advocates and being able to sort these matters out without having to go through to litigation. There is no question of an access to justice issue here because those opportunities are open to them. I do not believe that the Minister’s statement and my statement are mutually exclusive. 
Beneficiaries—Prime Minister’s Statements 
11. 
JAN LOGIE (Green) 
 to the  
Prime Minister 
: Does he stand by his statement that “It is also true that anyone on a benefit actually has a lifestyle choice. If one budgets properly one can pay one’s bills.”? 
Rt Hon JOHN KEY (Prime Minister) 
: 
 I stand by my full statement at the time which included that the global recession has seen more people on benefit. That obviously had an impact on the demand for food parcels but the bulk of New Zealanders on a benefit do actually pay for their food their rent and other things of that nature. Some but not all make poor choices and do not have money left. I also stand by my statement at the time that although some people make poor choices there are other factors for why people would go to food banks or need welfare support. 
Jan Logie 
: Given that the recently published  
2011 Food Costs for Families 
 report prepared by Regional Public Health showed an unemployed couple on the benefit with two children will have just $75 left each week after rent and basic healthy food how would the Prime Minister suggest they cover health care power clothing transport school and other costs for four people with just $75? 
Rt Hon JOHN KEY 
: I have not seen the report but what I can say is in the worst global financial recession since the Great Depression this Government has supported benefit payments. We have continued to support the accommodation supplement. We have continued to support Working for Families. We have got on top of inflation—so in fact food inflation was very low last year—and we are continuing to provide support for New Zealanders to be able to move into work. I am proud to say actually that there are now 20000 fewer people on the unemployment benefit than there were a couple of years ago—positive government in action. 
Jan Logie 
: So—[ 
Interruption 
] 
Mr SPEAKER 
: Order! I want to hear the supplementary question. 
Jan Logie 
: With his extensive budgeting experience what would the Prime Minister advise a family on this budget to choose: shoes or food? 
Rt Hon JOHN KEY 
: If they were in desperate need of support I would urge them to go into Work and Income. It would be able to provide them with more support. 
Jan Logie 
: What kind of lifestyle does the Prime Minister think children of beneficiaries on this kind of income are actually living? 
Rt Hon JOHN KEY 
: Well I think in all fairness they are living a poorer lifestyle than any of us would want and that is why the Government is committed to moving people off benefits and into work. The single most important factor we can make for the overall household budget of New Zealanders is to move those on benefit into work. That party seems to rejoice in the fact that there are tens of thousands of New Zealanders trapped on a benefit and it does not want to do anything about it. This Government is actually progressively helping people with extra childcare helping people with extra training and investing hundreds of millions of dollars into helping move people into work and that party does not want to do anything about those tough issues. 
Jan Logie 
: I seek leave to table the Regional Public Health report that shows that working families are not much better off. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? There is objection. 
Accident Compensation Corporation—Release of Personal Information and Minister’s Actions 
12. 
ANDREW LITTLE (Labour) 
 to the  
Minister for ACC 
: What actions apart from inviting or observing inquiries from the Privacy Commissioner and the Auditor-General has she taken since 12 March 2012 to see that issues arising out of the wrongful disclosure of personal information by the Accident Compensation Corporation to Bronwyn Pullar have been remedied or addressed by the Corporation? 
Hon JUDITH COLLINS (Minister for ACC) 
: 
 I have stayed in close contact with and required regular updates from the chief executive on what steps he is taking to build a culture of privacy and information security at ACC and rebuild public trust and confidence. In the last 3 months I have also visited nine ACC offices and spoken personally with staff emphasising the need for privacy and information security. I would like to point out to that member that both my visits and the message about privacy have been extremely well received. I would also like to point out that while the Privacy Commissioner is reviewing ACC’s privacy processes it is sensible to wait for her recommendations. However I have supported ACC in the steps it has taken so far. 
Andrew Little 
: What action has the Minister taken to ensure the advice she receives from the corporation is accurate in light of both a police inquiry and a television current affairs programme confirming that the statement in the 16 March 2012 report to her from ACC concerning Bronwyn Pullar that “She made threats that if her demands were not met she would not return the information and she would inform the media of the alleged privacy issue.” was not true? 
Hon JUDITH COLLINS 
: I am not in a position to answer that in the way in which the member has asked the question. The reason is that it is still subject to inquiries by both the Auditor-General and the Privacy Commissioner. I think it is important to try not to tread all over those inquiries. 
Andrew Little 
: What action has she taken in light of the High Court injunction issued against an ACC claimant Mr T just 2 weeks ago on 28 May 2012 ordering him not to disclose personal information improperly disclosed to him by the corporation to ensure that the corporation is serious about fixing its information management problems? 
Hon JUDITH COLLINS 
: I am sure that I have answered that in my answer to the primary question. The fact is the issue that that member raises occurred in 2008. There has been a lot of work done at ACC since then. If the member would like me to I can outline some of the steps that have been taken in the last 3 months. ACC advises me that it has cooperated with KPMG to carry out an extensive review of its processes and policies around privacy and information security. It has undertaken to implement all recommendations arising from independent inquiries into privacy and information security. It has agreed to implement a zero-tolerance policy of security breaches. A number of initiatives already implemented within ACC include refresher training for all staff the establishment of a privacy response team to answer queries and complaints training privacy champions to promote ACC’s privacy culture and practice identifying system and process changes to support privacy improvements and interviewing private and public sector agencies to discuss— 
Mr SPEAKER 
: Order! The Minister is doing very well but I think the House does not need to hear too much more of that. 
Andrew Little 
: What is more important to her: fulfilling her public duty to ensure ACC acts with honesty and integrity towards her and the public of New Zealand or pursuing her own personal and private interests in suing her political opponents and fund-raising for her legal costs because— 
Mr SPEAKER 
: Order! [ 
Interruption 
] Order! I am on my feet if it has escaped members’ attention. That question is out of order. That brings to a close questions— 
Hon Members 
: Why’s it out of order? 
Mr SPEAKER 
: Members have interjected “Why was it out of order?”. Perhaps a point of order should have been raised rather than just interjecting “Why was it out of order?”. But if I heard the question correctly it referred to a matter that is before the court and that is why it was out of order. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. It referred to the fact that the Minister was taking action. It referred to nothing before a court. 
Mr SPEAKER 
: What I believe I heard did refer to a matter that was before the court and I was not about to allow that to be pursued in the House. The House is to hold the executive to account and not to be pursuing matters that are before the court and that is why I ruled that way. 
Urgent Debates Declined 
Accident Compensation Corporation—Inquiry intoRelease of Personal Information 
Schools Class Sizes—Teacher to Pupil Ratios 
Mr SPEAKER 
: I have received a letter from Andrew Little seeking to debate under Standing Order 386 the Government’s reaction to the determination by the police on a complaint made by ACC about a meeting between Ms Bronwyn Pullar Ms Michelle Boag and ACC officials on 1 December 2011 and the ongoing privacy issues that have been highlighted. A debate on the release by ACC of private details of ACC clients was held on 20 March 2012. For there to be a case of recent occurrence there must be either a new situation of importance or a new development in an existing situation of sufficient importance to warrant in this instance a further debate being held. The determination by the police that no offence has been committed does not contain any substantive change that requires the immediate attention of this House.  
The urgent debate procedure is a means of holding the Government to account for matters that have actually occurred. It is not a means of exploring whether the Minister for ACC has confidence in the ACC chair and the board. There are other parliamentary opportunities for raising such matters. The application is therefore declined. 
Hon David Parker 
: I raise a point of order Mr Speaker. Did the Speaker give consideration to the fact that one of the reasons why questions could not be answered during the earlier stages of that inquiry was that there was a police inquiry? Therefore I wonder whether the Speaker took the lifting of the police inquiry into account when considering whether it was a case of recent occurrence. 
Mr SPEAKER 
: I accept the member’s point raised in good faith. The fact though is that an earlier debate was allowed so the House has already debated this matter once. The issue is whether there has been a particular case of recent occurrence that warrants the setting aside of the House’s business. It is my ruling that on this occasion there has not been a further particular case of recent occurrence. The police are an independent body. They have made a decision. It is in my view something that is not of sufficient magnitude to qualify as a particular case of recent occurrence that would need the business of the House to be set aside.  
I have also received a letter from the Hon Nanaia Mahuta seeking to debate under Standing Order 386 the Government’s decision to reverse Budget changes to teacher-pupil funding ratios. This is a case of recent occurrence involving ministerial responsibility. However not every ministerial announcement will give sufficient grounds for an urgent debate to be held. As the member’s application acknowledges the changes to teacher-pupil ratios were a Budget initiative and the House is still debating the Budget. In these circumstances I am not persuaded that the setting aside of the House’s business for an urgent debate today can be justified. This application is therefore also declined.  
Budget Debate 
Debate resumed from 31 May on the Appropriation (2012/13 Estimates) Bill. 
SIMON O’CONNOR (National—Tamaki) 
: 
 As I was saying what a great Budget that was and a fine Budget for our time. I want to congratulate the Minister of Finance on that Budget. I also want to thank the many people who are involved with it. I think all of us in the House appreciate that these things do not come together just on the whim of one or the work of one so I want to acknowledge them as well. One thing I do want to say is that I really love the Budget application. I thought it was very much like the National Party—it was innovative it was leading edge and it was No. 1.  
Mr SPEAKER 
: Order! I apologise to the member but could I just remind members that today all microphones are live. If members want the public to hear a circumstance in the House that the public may not be impressed by just keep making a lot of noise and I suspect the public will not be impressed. So I just alert members that today because of the sound system’s malfunction members need to be just a little more circumspect about the level of interjection the wittiness of interjection and the intellectual content of interjection because the public will judge what they hear. Normally they do not hear some of this stuff. 
SIMON O’CONNOR 
: Intellectual interjections—I have not heard those yet but I am conscious there is noise. I was talking about the iPhone Budget the iPad Budget and thinking again that it is a great Budget and a great Budget application. I just wanted to note as well that I have spent a lot of time on the Labour Party’s Budget application  
Angry Birds 
. I want to thank the Labour Party for its application  
Angry Birds 
. As we have just heard Opposition members do a lot of squawking ruffling their feathers and throwing themselves at the Budget over and over again. You see National is here because we are trying to build something—to build a brighter future—and these angry birds as we heard earlier today just continue to throw themselves squawking ruffling feathers and they have all gone conspicuously silent at the moment.  
These are tough times—these are tough times—and it is all about cutting your cloth to suit. This Government has maintained the services and prioritised those services for the people. This is a Budget that is responsible it is a Budget that is focused on growth it is a Budget that is about value for money and it is a Budget about front-line services—a Budget that understands what the people want and is open to engaging with the people. 
Chris Hipkins 
: But you don’t want bigger classes! 
SIMON O’CONNOR 
: Oh see—they continue. I must have run afoul of them there—I must have run afoul of them. I have noted in reading some of the other Budget speeches that there has been a lot of talk about Charles Dickens coming from the Opposition members. But they have missed one of the more interesting characters. Wilkins Micawber was a character who knew all about the importance of careful financial management and I am not really surprised that they are not familiar with him. Mr Micawber had an interesting philosophy and to paraphrase if I may read this he said the difference between happiness and misery is whether you are spending 10c less than you earn or 10c more than you earn. The Opposition and Labour in particular has never subscribed to this idea. But every household in New Zealand understands what it means. Labour is happy to spend the extra 10c the extra $10 million the extra $100 million. So I reject outright the amendment put forward by the Opposition which is working against this Budget. In itself it is illogical. The very amendment is illogical.  
Opposition members complain. They complain that this Budget has not made the tough decisions but then they are complaining because we have made the tough decisions. This is a Budget for the time and it is an appropriate Budget. We could have taken the easy way—we could have taken the Labour Party way—to spend spend and spend some more. But then the bill comes and it is time to pay up—it is time to pay up. The people of Greece are learning this lesson a little bit late but because of this Budget New Zealanders will not have to suffer the fate that Greece and other continental powers are suffering at the moment.  
I want to turn my focus on to education. 
Hon Members 
: Ha ha! 
SIMON O’CONNOR 
: Here we go again—throwing themselves at the wall. I want to focus on education notably tertiary education. It is an area of great interest to me. It is an area where a number of friends and colleagues have raised their points and have been engaging across the sector over the last few weeks asking questions. You know there have been a lot of complaints coming from people particularly those doing postgraduate degrees be it masters or PhDs. And I note that change is always hard; I want to acknowledge to those postgraduate students that yes change is hard. But I want to put a bit of context around these changes because there has been a lot of noise and a lot of well squawking—I think that seems to be the word of the day for them—around this. So the context around the changes: currently if you study at the universities the Crown pays 70c in every dollar; 70 percent of course costs are already paid for by the taxpayer by the Crown. We have interest-free student loans. They are available to all who choose to study—undergraduate or postgraduate. We also know that effectively between 40c and 50c in every dollar has to be written off on those student loans a further cost—or a gift if you like of the Crown to those who are choosing to study.  
We also know that there are a multitude of scholarships available to students from the private sector and from the public sector. I note that the Prime Minister’s Science Prizes were announced yesterday. So already we have a picture here of the generosity of the Crown the generosity of the taxpayers to people who choose to study. As I said 70c in every dollar goes towards their studies; interest-free student loans a significant write-down on that; scholarships; and of course we still have 200 weeks of student allowance for those in undergraduate degrees including those who choose to do honours. But I am aware that people are not happy and I have to say particularly to those students who are unhappy I find that the generosity of the taxpayer really is nothing short of astonishing. If you look at it in that context the giving that the taxpayer provides is nothing short of astonishing. But of course some people are still not happy. 
Jacinda Ardern 
: Is education a public good? Is it a public good Simon? 
SIMON O’CONNOR 
: And although I cannot fully hear the interjections I am aware that some people are still not happy because you realise there are about 20000 people in this country who are doing masters or postgraduate degrees. That is 0.5 percent of the population. And what is being asked for here in the complaints around this Budget to do with tertiary education is that the 0.5 percent want more: they want more than 70 percent of their fees paid they want more than 200 weeks of allowance they want more than an interest-free student loan they want more than the scholarships they want more than the opportunities. As we well know for most who do postgraduate studies there is opportunity to earn money through their teaching and tutorials and so forth. I say this not just as someone who speaks in theory but someone who has done two postgraduate degrees. I am very conscious that you do this freely and through a choice. For the record I did my first postgraduate degree while working full-time and studying part-time because I was aware of the financial consideration. And just to add to it because I recall the Green Party making an emotional but empty series of statements when I did my second postgraduate degree I was doing that working full-time and studying full-time. You see education is a choice and choices can be made and I for one as a postgraduate student have appreciated what the Crown has done.  
As I wrap up I would like to say that in theory I would wish that everything was free. It would be great. But that is not the world that we live in. Only in Labour do they think that everything should be free. I am conscious we are only a few weeks away from the mid-winter Christmas if you like and Labour does have a Christmas list that is a mile long. But Santa is not going to pay for the bills and the gifts that Labour wants to give away because in the real world we understand that grown-ups have to pay the bill. So we are not going to allow Labour to have people sit on its lap and demand gift after gift because it is ultimately the taxpayer who is going to groan and pay the bill.  
I come back to where I started: this is a sensible Budget. It is a Budget for its time. I am proud of the decisions that have been made. I am proud of the decisions that have been made in education and particularly in the tertiary sector. Thank you. 
Hon NANAIA MAHUTA (Labour—Hauraki-Waikato) 
: 
Tena koe Mr Speaker. That was the member for Tamaki Simon O’Connor who was happy to support the loss of teachers in intermediates in his electorate. He is standing in front of this House promoting education and what the Government has done. National has framed its fourth Budget as a zero Budget but a zero Budget is about zero hope zero aspiration and zero opportunity for the hard-working Kiwis struggling to make a living. They deserve more from a Budget than the one National dished out.  
We know that 13 days is a very very very long time in politics. The Minister of Education stood up in this House during the Budget debate promoting great gains in education. Just 13 days later she had to not only retract but reverse and do a whole about-face on a policy that fundamentally impacted on children and parents in the delivery of education as people know it and want to preserve it in their communities. It was an epic blunder that needed to be fixed and Labour members were happy that we raised those questions in the House to assure good-thinking New Zealanders that we were working with them on this issue.  
The Minister claimed that the Government was focusing on quality not quantity in the form of the new staff ratios that it wanted to introduce capping teacher numbers over the next 4-year period. Well it simply did not stack up. As people worked through the detail and as we presented questions in the House to the Minister that could not be answered more and more red flags went up as bastions of opposition in the schools and in our communities by parents who believe that their children deserve more. Parents were furious at the prospect that losing one or two teachers would fundamentally impact on the learning of their children. Why? Because they translated the National Government’s changes as larger class sizes fewer teachers and less opportunity for their children to get a really good chance in the classroom for one-on-one feedback from their teachers. They knew that it just did not make sense.  
The Minister talked a big game but she was short on detail. This became more and more evident as we started to understand the real effects of the policy that she was presenting to the House in Budget 2012. When she came to this House and introduced the fact that for years 7 and 8 technology teachers would be included in the new staff ratios we were flabbergasted on this side of the House. Immediately members on this side of the House were getting calls from intermediate schools saying: “She’s got it wrong. We’re not losing just two teachers; we could be losing up to eight teachers.” And that is not just about technology teachers; it is about delivering subjects like science like art like drama like all sorts of technology subjects like kapahaka and like gifted learning. Then we had a whole lot of primary schools saying: “Well actually for our young learners it may mean a cut to the extent that we cannot deliver remedial maths or recovery reading to our youngest learners who are often the ones who need it most.”  
The Minister still stood in this Chamber and defended that policy to members on this side of the House as if it was a great gain in education and we knew it was not. We knew that fundamentally children would miss out. Well hello! It was not until the adjournment when members of the Government went back into their own communities that they were flooded with very angry National supporters who said time and time again that the Government had it wrong. Thirteen days later right up until the end the Minister was still defending this policy. One morning she was saying that the Government was not going to reverse the policy the next minute she was saying that it would make a partial retraction and then by day 13 she said it would reverse this policy. The heat was too hot and she knew that the Government had got it wrong.  
Let me ask this: did the Minister in fact ask for the necessary information of officials to ensure that prior to making this decision the Government had got all the information it needed to assure itself that it was not going to fundamentally impact on the delivery of education in the communities? If she did ask for the information did Cabinet override that advice? We have not had any answers on that front. Or did she deliberately ignore that information? Time and time again when we were asking questions of the Minister in this House on that particular issue she managed to evade some detail on some very important questions. 
Maggie Barry 
: Listen to the answers. 
Hon NANAIA MAHUTA 
: But parents deserve an answer. Parents deserve an answer. That member should be listening to constituents in her own electorate who were equally as angry on this particular issue. That member was happy to go out and promote a policy that would fundamentally see the loss of teachers in intermediate schools in many electorates throughout the country.  
Labour said it would reverse this ridiculous policy because it did not stack up. Putting more children into a class and more pressure on a teacher to teach those children and give quality feedback would cause only more stress and National was not listening to them. We did. We said very early on in the piece that we would reverse it.  
The Minister needs to spell out her plan about how National will invest in quality teaching because this is an important aspiration. It should be done. But now that the Government has reversed the policy on larger class sizes I ask whether it will retract from its investments in improving the quality of teaching. There is no answer. Not a word. Not a sigh. Not anything. Members on that side of the House have their heads down. Continuing to invest in quality teaching we believe is an important thing to do but the Minister will need to demonstrate where she will now find savings from because that particular investment is essential.  
The other part of the humiliating reversal that she had to do and backtrack on was really supported by the words of young people themselves. I suspect that once the anger of parents moved into the domain of supportive evidence from teachers and then was translated through children they started to get upset about the prospect of losing technology teachers. This is how they explained it at Kowhai Intermediate School: “The good thing about technology classes is that they’re a fun way to learn things that you may need to do when you’re older.” They also said: “In primary schools they don’t offer technology.” and “Creativity and practical skills are an important part of education.” But here is the point that I think National members might want to hear. Students at Kowhai Intermediate School said: “Getting good grades in other subjects is important but people who make a difference in the world usually have a unique way of looking at things. You cannot be one of these people without creativity and that is what technology classes deliver.” Here is a Government that says on the one hand that it wants a brighter future for all New Zealanders but then it cuts technology teachers in our intermediate schools and limits the opportunity for our children to be able to take up courses that teach creative innovation. The Government got it wrong. We are happy to see the reversal. 
There are so many other areas in which things do not add up. We see increased funding for private schools since 2009—$14 million extra every year since National has come into Government. What is happening there? In last year’s Budget $21.8 million went into public-private partnership business case modelling and we still have not got any detail on exactly how much has been spent on the Hobsonville public-private partnership project. In adult and community education a further $4 million has been cut from universities affecting their ability to offer things like language programmes and computer skills. Here is a Government that is cut cut cutting and limiting the opportunities in a whole lot of areas for people to continue to thrive in education.  
Finally I will respond to the member for Tamaki who talked about student allowances. We do believe on this side of the House that postgraduate study is important. Limiting access to a student allowance to only 200 weeks will affect those who cannot afford to go into postgraduate study. We will see a lot of people who are unable to take up the opportunity to continue to improve their skills because of a decision that this Government has made. We do not support it. The fourth Budget for National has got it wrong in education. National should be ashamed about what it was proposing to do pulling the wool over parents’ eyes. Parents are not stupid. We are glad we supported them on that fundamental issue of giving our children the very best in education. Kia ora. 
Hon JUDITH COLLINS (Minister of Justice) 
: 
 I must say that was an awfully long 10 minutes. I thought about taking a point of order and questioning whether or not the clock had stopped but everybody is allowed to have their say in Parliament and that is a marvellous thing.  
This is a great Budget particularly when one looks around the world and sees what is happening elsewhere. When we look around we often like to compare ourselves with Australia. Of course in Australia they do mining and resources—the sorts of things the Opposition would not have us touch but it is happy to take the income that comes from them. But actually what this Budget has been able to do is to continue down the great path that the National-led Government along with our colleagues in the ACT Party United Future and the Maori Party has been able to deliver.  
I look at the law and order and justice areas—and they are the ones that I am most concerned with—and at what we have seen in a time when there has been a global financial crisis and a recession. We came into Government and the country had been in recession for the last three quarters. We were told that what would happen is that there would be an increase in crime that crime would go up that we would run out of prison beds and that we would be in a terrible situation. And we came in and we found that there had been these new prisons built by the previous Labour Government—and they are extremely flash I have to say; extremely flash—but it needed a lot of work to put those double bunks in and that seemed to sort out quite a few of our issues. 
 Then of course we brought in a private prison—private management—which seems to be fantastic really— 
Chris Hipkins 
: How many people have escaped from it? 
Hon JUDITH COLLINS 
: The member over there Mr Hipkins seems to have forgotten that there were two escapes from Waikeria Prison just the other day which of course is State run. Of course in the private sector when one of Serco’s prisoners escapes it costs them $150000. But nobody pays in the public sector.  
What we have seen is actually a situation where the crime rate has come down. It is now at the same level as it was in 1982—1982—and in amongst all of that we have also seen the prison population start to fall in a sustained way for the first time since the 1930s. So instead of Labour which was constantly having to catch up with more prison beds this Government has got the situation where we have now announced the closure of two prisons Wellington’s Mt Crawford prison and New Plymouth Prison which should never have been used for housing people in today’s world. We would not have had to use them if we had been left with enough beds by the previous Government. But anyway those are just some of the success stories.  
We can also say there are 600 more police on the beat—600 more front-line police. There is now DNA testing for serious offenders and there are tools to seize the proceeds of crime. That has been a great success. Serious criminals and repeat offenders are being kept behind bars longer with no bail or parole eligibility. It was this party—this party—along with our coalition partners United Future and the ACT Party that brought through the Search and Surveillance Act which should have been done years ago. It was first started in about 2007 but unfortunately some parties in this House decided they were going to play politics with this most important issue and were quite happy to leave the police out there unable to deal with methamphetamine dealers and the like. Shame on them for not taking the right stance.  
What we have seen though in amongst all of that is this Prime Minister take on the role of saying that he wanted to tackle methamphetamine in this country and he has done so with outstanding results. He has made sure that departments have worked together and that Ministers have worked together and there has been a coordinated approach. So instead of the previous Labour Government’s approach of saying: “Oh we can’t do anything about it because it might upset their rights.” or some other nonsense like that what we have seen is coordinated work across the police the Customs Service justice health and the prison system to make sure we deal with this issue. We are now starting to see some really good improvement but the battle is still not over. There is still more work to do. 
 We have also seen the road toll come down to the lowest it has been in 50 years and that is about very smart road policing. It is also about new road safety initiatives and better public awareness as well so congratulations to all those people involved in that; they have made us very proud. We have had 18 new public safety laws passed we have over 6000 families now protected by police safety orders we have got prison escapes actually at the lowest levels ever and we have 2000 victims now supported through the offender levy—and yes there is more.  
Under this Budget what we are seeing is not what we are seeing in many other similar countries around the world which are seeing massive redundancies in police and massive loss of confidence in the safety of the public. We are actually seeing the police maintained at the level they have been at. Yes they are constantly looking at how they can use technology to upgrade the way in which they work to be smarter faster and more effective in preventing crime in the first place. They have brought in the Policing Excellence programme which has been a fantastic success and it is going to keep going.  
In addition in the Ministry of Justice in particular we are looking at the work we are doing across the sector to make sure that we look at the “crime lines” you could say of those coming in through the pipeline those coming into the justice system either in youth justice or elsewhere and ending up in the prison and probation area. What we are doing is that the Ministers are working together to make sure that what we do and what our chief executives do is constantly predicated on the need to bring crime further down to bring youth crime down and to bring down violent assaults. So this is better public service. This is actually about looking at how we can better manage the resources we have how we can better react to the public and how we can be smart in how we operate.  
Coming up this year will be a completion of the review of the Family Court and that is something that I am very passionate about having practised for around 20 years some of it in the family area. I have seen over the years many times when the Family Court has been used to abuse others when children have not been put at the forefront of parents’ minds—sorry my throat is going.  
Chris Hipkins 
: You wouldn’t be emotional?  
Hon JUDITH COLLINS 
: No definitely not. But what we have seen actually is a situation where children can be used by one parent to attack the other and that is simply not acceptable. The State should not fund that sort of behaviour; the State should not be complicit in it. The State should be better than that and that is what we expect to be.  
In tertiary education we are continuing to target student assistance to where it is most needed and ensure better value for taxpayers. Simon O’Connor spoke about his two postgraduate degrees both completed when he was working full-time and studying full-time. I feel like I could say that I sort of did the same too: in my first postgraduate degree working full-time and studying part-time and in my second working full-time and studying part-time. It is hard to do it that way but at the end of the day we did not owe anyone any money at the end of it. It is a tough road but that is what happens. I think we have to be very careful what we do in tertiary education. We also have to be very careful with taxpayers’ money. We also have to understand that the people who are the panel beaters and the people who work in the supermarkets expect us to be careful with their tax money as well and expect a decent return for it and that means good education good outcomes and people contributing to the economy.  
In essence and in conclusion this is an excellent Budget given very difficult financial times around the world. We just have to look at our friends in Europe to see what has happened there and we are not just talking about Greece. There are other parts of Europe that are very badly affected and not just Europe: the UK parts of Australia and parts of the United States. Some have been going through very very tough times much tougher than ours. We are very fortunate in where we are placed in the world we are very fortunate to have a judicial system that is not corrupt and we are very fortunate to have a police force that is not corrupt. All these things help to build confidence in the economy and confidence in business. However we are a small country and we have to live within our means and this Budget does.  
Hon PHIL GOFF (Labour—Mt Roskill) 
: 
 There are a couple of things that the Minister of Justice who has just resumed her seat forgot to mention. Sure the crime rate has come down. Perhaps that had something to do Mrs Collins with the 1000 extra police officers on the front line that the Labour-led Government put on in its last term in office. Perhaps it had something to do with totally revamping the thoroughly inadequate rundown prison system that we inherited from the last National Government. Perhaps it had something to do with the total overhaul of legislation for the Sentencing Act the Parole Act and the Proceeds of Crime Act. Perhaps it had something to do with that.  
But what Mrs Collins has not told us is what this Budget is doing for policing. This Budget represents a real cut to police funding: 125 staffing positions cut and that is just to begin with. Dozens of police stations Mrs Collins will close during this term. Do you know what I found out about my local police station? I found out that they might not close it but they will close it to the public. They will close the police station to the public. What does that mean for community policing? I was standing there talking to a member of the police force who is also on the local community board when a woman biked up in distress and said that she had been sexually threatened by a man just down the road. In future do you know what she will have to do? She will have to bike to Avondale. That is 9 kilometres away. Do you think she is going to report that crime? Do you think the police are going to be able to respond immediately to it? Not on your life. Police stations mark my words will close in their dozens and that is the very opposite of what community policing is meant to be about. Then the Police Association told my colleague Kris Faafoi here that the Government is going to cut the pay of front-line police officers over the next 10 years—it is going to cut it. The previous Minister of Police boasts about how uncorrupt and competent our police force is and she is largely right about that but how is it going to help to cut their salaries?  
But today I do not want to talk about that so much as about the evidence last week that we saw of National’s education policy to increase class sizes and to cut technology learning in our intermediate schools crashing and burning. What a humiliating backdown for Hekia Parata. What an embarrassment that was for her and the National Government. I will give you this guarantee. There will not be a single National MP who gets up and praises the National Government’s Budget policy on education. You know the only thing I regret about the embarrassment that Hekia Parata faced was that the two major architects of that policy John Key and Bill English were nowhere to be seen when she had to front up and back down. They were nowhere to be seen.  
Do not tell me members of the National Government that Bill English did not know exactly what that Budget policy meant. It was in the briefing paper to him as Minister last year—increase class sizes it said. Then the Secretary to the Treasury Gabriel Makhlouf gave a speech just 2 months ago saying that the way to improve quality in education was to increase class sizes—increase class sizes. Did National members actually believe that? They parroted it for a fortnight. I bet we never hear it again from them.  
I was looking at a copy of the  
Listener 
 the other day from 28 May 2005. There was an interview with one Mr John Key. What was Mr Key saying? He was asked why he sent his children to private schools. He said really it is “for educational reasons. Their schools have smaller classes and are better resourced...”. That is what he said. 
Hon Nanaia Mahuta 
: One rule. 
Hon PHIL GOFF 
: One rule for Mr Key and for the majority of Cabinet who send their kids to private schools and another rule for the rest of us whose kids proudly go to public education in this country. I want to say that if it is good enough for kids in private schools to have small classes so they have more individual learning then it is good enough for all of our children. If we have a philosophy as New Zealanders a set of principles and ideology it is the ideology of fairness. It says that some kids will come from privileged and wealthy backgrounds—fine. Other kids do not. But the really important thing is that every child should get equal opportunity. Every child should be able to achieve his or her potential. I will fight and fight and fight again against this National Government which says it will put more money into private education but for the kids who go to public schools it will increase their class sizes and close down their technology classes.  
You know I do not exempt Ms Parata from the blame of this policy altogether. She has a job as Minister of Education—I once did that job—and her job was to understand the policy that was being proposed to subject it to scrutiny and to make a judgment as to whether it was the right policy. [ 
Interruption 
] I will ask Paul Goldsmith this question. If she knew the impact on intermediate schools why did she not tell her colleagues? 
Paul Goldsmith 
: Is that a rhetorical question? 
Hon PHIL GOFF 
: He has no answer—he has no answer. If she knew and she did not tell her colleagues that was appallingly bad judgment. And if she did not know the consequences that was simply incompetence and inadequacy on her part.  
You know we heard her going through the parroting of all of the explanations. Here is a commentator in Saturday’s  
New Zealand Herald 
: she was “spouting meaningless blather. Repeatedly mouthing platitudes …”. It is just not good enough to parrot a line. “The truth is”—and this is word for word—“that the Education Minister’s botched handling of the cost-cutting blunder which initially would have seen some schools losing up to five teacher positions has brutally exposed her political shortcomings.”  
Under a Labour Government the education spokesperson is always on the front bench and to get on the front bench you have to have political competence to be there. But we have seen anything but political competence from this Minister. This policy was a disgrace. It was a disgrace that she was hung out to dry by Bill English who did not front up alongside her despite the fact that he knew what that policy meant and it was an equal disgrace from John Key to support a policy that was absolutely rejected by parents right across our community. It is strange I often think how a number of people in this House have benefited from the welfare State in their time of need but when it comes to extending the hand of help to kids who have need today they do not want to do it. They just want to cut; they want to make things worse.  
John Key did say one thing that was interesting on Newstalk ZB. He said that he is not arrogant enough not to listen to what people are saying. Well I have got some advice for Mr Key. In every public opinion poll that has ever been held in this country people have said that they do not want to see New Zealand flogging off its public assets. I wonder whether Mr Key is not arrogant enough to ignore their views because those on the Finance and Expenditure Committee who have been going around the country over the last month or two time and again heard submissions from people utterly and emphatically opposed to the sale of assets. Why would you sell the best-performing assets that you have got? These are the assets that Treasury itself admits are so efficient that privatisation will not improve their efficiency. Why would you sell the assets that returned to us 2 years ago $700 million in 1 year which as John Key admitted went towards our hospitals and our schools? Why would you hand over ownership of something that all of us as New Zealanders as Kiwis and as taxpayers own and benefit from to only those who can afford to pay for it? And why does the Government not admit that most of those shares the cornerstone shareholding will go into foreign ownership? That is what Treasury says in its briefing to the Government.  
This was a zero Budget: zero extra spending zero contribution to growth zero vision and zero hope. The only thing that it will continue to do is to send New Zealanders the 1000 a week who are leaving out of this country and into Australia. One school in my electorate which was mentioned in the paper this morning Wesley Intermediate School has lost 14 percent of its roll in the last year to Australia. This Government has failed this Budget is a loser and we are seeing the last term of this National Government. 
Hon NATHAN GUY (Minister of Immigration) 
: 
 What we have heard there from the former leader of the Labour Party is just so much negative claptrap is it not? It is no wonder that that member was rejected by most New Zealanders at the 2011 election. It is because he was so negative. Here we have this Government in the Budget of 2012 in very tough economic times that has delivered a very pragmatic Budget for these economic times. When you look at the dark grey clouds gathering in Europe and when you think about what those members on the other side of the House would do if they were sitting over here on the Treasury benches we know what they would do. They would spend more and increase taxes. Our debt would just blow out and balloon and we would end up in a situation like many countries in Europe now. Some of the countries over there have 50 percent unemployment. We see now Spain with a $100 billion bailout of its banks. These are the issues that New Zealand has to face. But over on the other side you hear Phil Goff the former leader of the Labour Party so negative. Where is the aspiration? Where is the positive talk? There is nothing. There is nothing from the Labour Opposition. Whereas under the stewardship of the finance Minister Bill English with the overwhelming support of our Prime Minister we have delivered a Budget that has been difficult to bring together under these economic times but where we have found new spending reprioritised spending of about $4.4 billion or $4.5 billion reinvested into core public services.  
Most New Zealanders know that we have to tighten our belts. Most New Zealanders know that we have to rein in debt. Most New Zealanders know that we have to lift productivity and grow the economy. That is why it is great under this Government that our economy has grown in nine out of the last 10 quarters. Is not that fantastic? We are growing. When you look at the countries that we like to compare ourselves with and those that I have just talked about in Europe where they are not growing New Zealand is growing. We are going to grow a lot more jobs; about 150000 are forecast by Treasury in the next 4 years. In the last couple of years the economy has grown 60000 jobs. 
 Just in the last week we had Minister Paula Bennett talking about unemployment and how that dropped considerably down to about 50000 in May—fantastic—a drop of more than 3500 in the last month. What is also topical is the young people who are getting back into employment. That peaked in January 2010 at about 23500; now it is 13500. Is that not fantastic? You heard from the Prime Minister today that about 20000 people have moved off the unemployment benefit in the last couple of years. The economy is growing and that is as a result of the tough decisions that have been made by this Government under the stewardship of the Minister of Finance Bill English.  
Think also about the vulnerable. Under tough economic times we have supported those whom we needed to support—for example those on Working for Families and superannuitants. Superannuation is up by about 20 percent since 2008—fantastic. War pensions are up. And we have a real focus on getting even more people off the unemployment benefit and into work. Minister Paula Bennett is doing a fantastic job there. We need to support her. We need to ensure that these New Zealanders are able to perform in our modern-day economy. That is where it comes down to education. Yes we have had a robust discussion about education. It has been interesting to hear all of the issues that have been raised— 
Hon Phil Goff 
: Your policy crashed and burned. Just admit it.  
Hon NATHAN GUY 
: —since the Budget was announced in the last few weeks. One of the things— 
Hon Phil Goff 
: Two weeks and you had to withdraw it. That’s how bad it was. 
Hon NATHAN GUY 
: —that the Opposition and Phil Goff who is chipping in now have not talked about in his negative rant is why the performance of our teachers is not improving. Why have we still got one in five children failing in our education system? Why has the tale of underachievement been constant under the Labour Government for 9 years? Now this Government is keen to address that to ensure that we lift the tale of underachievement. Why did we have our opponents so negative when we rolled out national standards? Why did we have that? That was because they were supporting the teacher unions. Now parents have plain reporting coming on to the kitchen table. They know how well their children are doing and they know where to put the support for their children so that they can continue to lift the standards of numeracy and literacy.  
What we have from the Opposition is no debate talking about why there has been a 13 percent increase in teacher roll growth over the last 10 years when the student roll growth has been about 2.5 percent. Teacher roll growth is up here student roll growth is lower yet the quality and the performance of our students coming out of our education system have not improved. That is where the debate now needs to focus on in my opinion.  
This has also been a great Budget for health—$435 million extra invested in health and there is a lot more going into research and innovation which is part of our economic growth agenda. We are also putting more money into our assets as well. Think about what is happening in our State highway network up and down the country. Roads of national significance are going through the consenting process which has been fast-tracked under this Government like Transmission Gully and the Waterview Connection. All of these ones that would have probably taken about 5 years on average under the previous Government have now been put through an Environmental Protection Authority process of about 9 months.  
My constituents in the Otaki electorate are saying “Bring it on for Transmission Gully bring it on for the Kapiti Expressway ensure that we can improve our safety performance on our State highway network lift productivity and continue to grow our regional economic growth.” But what we have from our opponents over there is such negative claptrap. They over there on “Planet Labour” are not aspirational at all. They have continued to worry about their leadership woes. It was interesting when I had a look at my Saturday  
Dominion Post 
. The interesting thing about the leadership woes in Labour continues. Here we are: “The man waiting in the wings” Grant Robertson. There was a lovely story on Grant Robertson—just what I am sure David Shearer the new leader would not want. Is it not amazing when you have the battle of the three Davids still ongoing and here you have Grant Robertson the deputy of David Shearer having a blow-by-blow piece in C3 in the inside of the Saturday  
Dominion Post 
? 
What was interesting in here was that “Mr Robertson lives by three rules:”. The first one you might be interested to hear about is “treat others how you want to be treated”. Well I would have thought it is ironic that Grant Robertson wants to treat David Shearer in this way with a full-blown article with a heading saying “The man waiting in the wings”.  
The Labour leadership woes continue. David Shearer continues to bumble and stumble and stammer and stutter his way through interview after interview. Grant Robertson is loading the deckchairs up there in the office. He is getting his staff appointed in. Mark my words by the end of the year Grant Robertson will be the next leader of the Labour Party.  
Anyway I will get back on to the issues about this very important Budget which has been carefully crafted by the Minister of Finance and well received by most New Zealanders. The thing that I am very passionate about as Minister of Veterans’ Affairs is the 10 extra deployments that we announced in this Budget. It was hard to find any new money but I put a pitch through Cabinet and we managed to find $4.8 million for the 10 extra deployments. Those New Zealanders who have served in places like Rhodesia Afghanistan Iraq Iran Cambodia Somalia Haiti Bougainville Sudan and south Lebanon will now be able to get a war disablement pension. It is a fantastic initiative supported by this Government in tough economic times. Most important as I wrap up this is a Budget that has been well delivered and well received by New Zealanders and thank goodness we have got a decent Prime Minister in John Key.  
Hon CHRIS TREMAIN (Minister of Internal Affairs) 
: 
 Tena koe Mr Speaker. It is a pleasure to rise after the Hon Nathan Guy as he finished on discussing the 10 extra deployments and the war disablement pensions that he was able to deliver through this Budget 2012.  
As I start out it is interesting to reflect on what has been happening around the globe in just the week that has been. Spain has applied for a €100 billion bailout of its banking system which could see its public debt rise to over 90 percent of GDP. In that country alone Spain nearly 50 percent of its youth—25-year-olds and under—are unemployed unable to find jobs and without a future ahead of them. So to be able to stand here today in the context of what is happening in Spain Italy Greece Portugal—in fact Ireland and the UK as well—and debate this Budget which Bill English has put forward is a wonderful opportunity.  
Let us put it in context in regard to those other countries. This Budget will keep Crown debt below 30 percent of GDP—30 percent. It is about 23 percent now at its maximum rising to 28 to 30 percent of GDP. That is a wonderful position to be in as a country particularly compared with those European nations. Our long-term objective by 2020 is to get that debt back down to 20 percent of GDP. We have set an objective of getting back to surplus in the 2014-15 year and I am confident that that will happen especially on the back of the fact that just last week Minister English announced that this year’s Budget deficit is over $1 billion less than we had forecast. This was for two key reasons—important reasons: firstly increased revenue of about $700 million but also importantly $300 million additional savings over and above what we forecast. That is a fantastic situation to be in.  
On top of that we see an announcement by Minister Paula Bennett saying that there are 20000 additional jobs and that the unemployment benefit numbers right now—today in the middle of very difficult times—are the lowest they have been since 2009. On any basis this is a great space to be in.  
In thinking about this Budget I am calling it the “hard yards Budget”. It is where this Government is doing the hard yards to get us through and back to surplus back to a position where our debt is starting to come back. It is a bit like the forwards in a rugby pack. This Budget is a props hookers and locks Budget where they pick up the ball from the back take just an extra yard and get closer to that finishing line. This is not a wingers Budget or a full backs Budget.  
Paul Goldsmith 
: No show ponies.  
Hon CHRIS TREMAIN 
: This is not a show ponies Budget. This is a hard yards Budget that will return this country back to surplus bringing our debt down. I think that is important.  
Over and above all that what we are seeing throughout the public sector is a revolution taking place. A quiet revolution is occurring. I want to thank public servants around the country for the job that they are doing to assist us in bringing this country back into surplus. But that is happening not only in the Public Service but in NGOs throughout the nation. In that regard I wanted to focus on a couple of initiatives in my own electorate back in Napier. One is around the Napier Kindergarten Association and an issue that came to the table a couple of Budgets ago. We introduced a policy that was not popular at that point in time where we capped the spend on teachers to an 80 percent level of qualified teachers at early childhood education centres. Rightly so at the time the industry was up in arms about that and was concerned about that. I attended an AGM where the association was very concerned about that funding and what it would do to it.  
But today I want to talk about the association’s AGM this year and what it has actually done. A year on from that despite all the dramas that were predicted and all the issues that it thought might come into play these are its profit and loss figures: in 2010 it was fortunate to make a $320000 profit. Given all the concerns that were posed about the drop in funding one would have thought that things would get a little bit more difficult. Well the 2011 financial accounts show a $339000 profit. So I want to congratulate that association on the wonderful job that it has done in very difficult times.  
But here is the interesting point. This is how it achieved that result. I am going to read from its financial manager’s report. It says: “It’s important to note that in taking on and dealing with these issues we are going to do a number of things. Strategies we employed to minimise the impact of the funding cuts included introducing Friday afternoon sessions being open for the maximum number of days available to us diversifying a couple of the kindergartens to all-day licences and”—here is the real kicker—“being prudent with expenditure renegotiating service costs where possible.” My goodness! Is that not terrible! These guys are to be congratulated because what they have done is given the difficult times we are in they have risen to the mark and have delivered. They have delivered the same if not better services with less money. That is something to be congratulated on and I am proud that my kindergarten association has risen to the plate in that regard and delivered these amazing savings.  
Outside of that I want to talk about the ministries that I am proud to be now associated with as Minister and the efforts they are making in that evolutionary process to deliver better services to the public and with less money. I start with tourism where Kevin Bowler at Tourism New Zealand Liz MacPherson at the Ministry of Economic Development and their teams are doing a magnificent job. They have refocused the strategy to continue to drive additional tourists to our nation while the segments around the world—as Europe backs off China rises Asia rises. They are refocusing their strategy reinforcing the “100% Pure New Zealand” brand which is superb. But importantly here is what they have really done which is exciting. They have raised an additional $25 million from the private sector for partnership funding—$25 million. They are using that money to support the promotion of New Zealand and to increase tourism opportunities here in New Zealand. That is fantastic.  
The Ministry of Civil Defence and Emergency Management is ably led by John Hamilton and he is doing a wonderful job there. It has delivered a 6 percent efficiency gain to the Government and that will help us to drive this Budget—this hard yards Budget that I was previously talking about. But while doing that the ministry is still delivering superb services. It is focusing on lifting the capability of our 16 regions. Through that I just want to thank those regions that have had to deal with severe weather events since I have been the Minister of Civil Defence particularly Nelson Taranaki and Northland.  
My larger ministry which is the Department of Internal Affairs is a wonderful ministry. It really is the heart and soul of New Zealand. It deals with citizenship on the one side through to censorship on the other. And those guys in the censorship compliance unit as I said when I stood and took a question in the House recently did a wonderful job in bringing those 55 people to task and saving those 12 children. These guys work in a tough environment and are doing a great job.  
One of the wonderful opportunities we have in the Department of Internal Affairs is to deliver on result area No. 10. It is one of the 10 results that the Prime Minister has put his hand on the table and said that we will be held accountable for doing these things such as lifting the level of early childhood education to 98 percent of children and getting National Certificate of Educational Achievement pass rates from around 68 percent where they are now to 85 percent. But result area No. 10 is where I have some responsibility. That is about giving New Zealanders the opportunity to have a much stronger digital interface with the Government and making it easier for them to work with the Government in a digital environment. We have a range of projects that I am proud to see the department delivering on in that regard allowing citizens to have a stronger relationship with the Government. There are a couple that I have announced just recently that will see huge savings. Last week alone we confirmed an IBM contract that will see significant savings in the order of $250 million over a 10-year period. There are huge savings with the one.govt network which will see $400 million to $600 million in savings. I mean this is real money that we can deliver back into education and health and deliver more surgical operations and better education for our kids.  
I am proud of what is happening with this Budget. We are driving revolutionary change and this is an exciting time for New Zealanders. Thank you. 
Hon NANAIA MAHUTA (Labour—Hauraki-Waikato) 
: 
 I seek leave to table letters from students at Papatoetoe Intermediate School to the Prime Minister and the Minister of Education regarding what the school perceived as the impact of the cuts— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Is there any objection to that course of action being taken? There is no objection. 
Documents by leave laid on the Table of the House. 
Hon NANAIA MAHUTA (Labour—Hauraki-Waikato) 
: 
 I seek leave to table letters from students at Morrinsville Intermediate School again given to me by hand to be tabled in the House— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Is there any objection to that course of action being taken? There is none. 
Documents by leave laid on the Table of the House. 
Hon LIANNE DALZIEL (Labour—Christchurch East) 
: 
 On 5 June the Prime Minister sent out a letter to residents in the Christchurch East electorate. It was done electorate by electorate whether or not the Government had a constituency MP representing that electorate. John Key sent it out in his name and he said that the rebuild of Greater Christchurch was central to the plan that was set out in Budget 2012. The Government’s narrative around the earthquake recovery in Christchurch or greater Christchurch as it refers to it—because of course Waimakariri District Council and Selwyn District Council are included within the greater Christchurch area—was very clear. The Government is putting a lot of money into the rebuild of Christchurch and that means that it does not have money available for other things that have suddenly become the “nice-to-haves”. The people of Christchurch are actually sick and tired of this Government using them as an excuse to sell our country’s assets and to do things like put extra taxes on our newspaper delivery kids. The newspaper deliver kids in Christchurch have had a pretty hard job of it getting through the streets after all the earthquake damage and finding their pockets being picked by the Government to make up the nickels and dimes in this sort of Budget is absolutely unreasonable.  
But for the Government to talk about what is happening in Christchurch as an excuse for what it is doing to the rest of the country is intolerable given what we have already experienced in Christchurch. It is about time that we were allowed to speak the truth in this House about what has really been going on as the Government has entirely politicised the situation in Christchurch to its own advantage—even from the moment that it chose the corporate colours for the Canterbury Earthquake Recovery Authority. What colours do you think most people in New Zealand would associate with Canterbury? It would be red and black would it not? You would expect the corporate colours of the Canterbury Earthquake Recovery Authority to be red and black. Actually they were going to be red and black. The Minister had a special jacket made—red and black with the label CERA on the front of it—very shortly after the February earthquake. After the Canterbury Earthquake Recovery Authority had been set up he had that red and black jacket on. But guess which corporate colour it settled on? It settled on blue. What association does blue have with Christchurch? None—absolutely none. So it was a subliminal message. There are those who say colours do not matter but actually in Christchurch colours do matter because if your property is red zoned or green zoned—now with a blue tinge over the top of it—then it certainly does matter. It matters to your equity. It matters to your future. It matters to any decisions that you can make. It matters to your relationship with your insurance company. There is nothing that matters more in Christchurch at the moment than colours. National started the colour regime with its own decision to put the National Party brand on the Canterbury Earthquake Recovery Authority. The subliminal message is that the National Government is rebuilding Christchurch. Canterbury cannot even own its own recovery with its own colours leading the way red and black.  
That is something that Labour would restate straight away and that is that red and black would be leading the recovery. We would let the people of Canterbury own their own recovery. We would not have a top-down Government department and a Government Minister actually controlling the recovery of our city and making all of these decisions without any engagement with the people. We would put a layer of governance between the Minister and Roger Sutton who is the head of the Canterbury Earthquake Recovery Authority which would become a State-owned enterprise or an independent Crown entity in order for it to be able to do its job properly which is to facilitate the recovery. It is something that has got to be owned by the people with a proper sense of engagement with the people so that they can be involved in it.  
Let us have a look at what the Government is saying in its narrative. It has set aside $5.5 billion for the Canterbury Earthquake Recovery Fund and then goes on to say that more than $3.4 billion of the recovery fund will have been spent by next year. Well that is not true. We know that that is not true because in fact we have done the sums. The Government has thrown everything into the $5.5 billion that it can possibly find. It has got $4 million to establish the Canterbury Earthquake Recovery Authority $3 million for the royal commission of inquiry $23 million for work that was already done before the 22 February earthquake even happened a $5 million donation to the Red Cross Society Inc. $20 million on the national controller and civil defence costs and $100 million for the AMI contingency which originally was $300 million - odd.  
Then it has added in what it would have to pay for its own asset repairs—schools and State highways. That is in there. It is over $80 million so far and increasing. Of course there is the total amount allocated to repairing local infrastructure—$1.6 billion over 5 years—which represents the 60 percent of the cost the Crown is already liable for under the pre-existing arrangements between central government and local government in the case of a natural disaster.  
When we analyse the Budget numbers we discover that the Government had shifted just over $1 billion from the forecasts allocated in the pre-election fiscal update to the yet-to-be-allocated category and then claimed that as part of the $2.17 billion projected spend this year. I am afraid that is just smoke and mirrors and that is what the Government has been doing with this. The reality is that the Government has really played tricks with people’s confidence over a serious disaster and I think it should be held to account for doing that.  
Of course in this letter it goes on to repeat all of these other things over and over again. The Government has “repaired over 15500 homes”. Well it has not paid for that. That is being paid for by either the Earthquake Commission or the insurance industry so that is not something that the Government has had to pay for. Twelve thousand square metres of road have been repaired. Well actually that is included in the sum it has already mentioned and also the additional amount on installing drinking-water pipe waste-water pipe and demolishing 80 percent of unsafe buildings. Those things are all paid for out of other budgets and so it is just restating it. The Government has purchase offers to more than 6000 residential red zone homeowners and two-thirds have been accepted but it does not say that the underlying assumption was that 100 percent would accept option one. Actually 25 percent of those who have accepted one of the options have accepted option one. So its assumptions are completely wrong and it has not done the numbers again. It is not telling people the truth. It is not being up front with people and this should be the most open and transparent process. There should be open engagement with the people. 
 It is fast tracking planning permission to make thousands of new residential sections available in new subdivisions on safe land. Well when do they come? Too late for the people who have to move out of the red zone. Not one single one of those sections will be available to rebuild on by April next year—not one of those that they have fast tracked the planning permission for. Then it is completing the infrastructure repairs and undertaking a further amount each month on average. Again that is restating the figure it has already included in the original figures. But then what does it do? It says that you can have your say now. It is time for you to have your say and let us just restate our position on this. The letter says: “Pease tick the three aspects of the Government’s commitment to rebuilding greater Christchurch that are most important to you:”. So of course it is reinforcing to the public that the Government has got this commitment to rebuilding greater Christchurch and that is because the National Government is doing it. It is not facilitating people to do it for themselves.  
But then it goes on to say this: “Please tick one of the following options: I ALWAYS support the following political party: United Future Green Maori Labour National Act NZ First. OR I USUALLY support the following political party:” and it has set out the political parties again. Then it says “OR I don’t support any political party in particular.” Then it says: “Privacy notice. Supplying this information is voluntary. The information is being collected by National MPs in their capacity as Members of Parliament to be used for electorate and related activity.” Well this letter is for Wigram. The other one that I have got here is for Christchurch East. I am afraid that Megan Woods is the MP for Wigram and I am the MP for Christchurch East but it suggests that people go to “Our Christchurch Central MP Nicky Wagner” who is “available to assist you with constituency issues”. Nicky Wagner will not help her own constituents with these issues and in fact we have had to take up the work that she has left behind. So what— 
Chris Hipkins 
: The taxpayer paid for that. 
Hon LIANNE DALZIEL 
: And the taxpayer has paid for this to go out there to find out how people are voting and to actually finally come clean and show that National has been entirely political about this from start to finish. It has not worked with the people about the issues that really matter. What I am concerned about is that we have got people who now live in different parts of electorates who have to put up with this over and over again. This photograph is of red zone land; this photograph is of green-blue land. It is not fair that the Government will not work with the people in order to ensure that they understand what is going on.  
I would like to seek leave of the House to table an example of the correspondence that the Rt Hon John Key has put into my electorate of Christchurch East. 
Mr DEPUTY SPEAKER 
: Leave is sought for that purpose. Is there anyone opposed to that course of action? There appears not. Leave is granted. 
Document by leave laid on the Table of the House. 
MICHAEL WOODHOUSE (National) 
: 
 There was a speech that focused on the burning issues of the day did it not—the colours of the Canterbury Earthquake Recovery Authority! Goodness me! In this debate I just want to talk about the issue of fiscal policy in general and the fairness of our tax system. I find myself in the unusual position of reflecting back on Budget 2010 and the reason for that is the many references made in this House to the cost of tax cuts for those in the upper income bracket—in particular the references from Dr Norman who has gone on ad nauseam over the last month about his belief that the National Government’s tax cuts in 2010 far from being fiscally neutral actually cost “$2 billion and counting”. I have got no ability to say whether or not that figure is correct but whether or not it is it is certainly not the full story. In fact it seems that Dr Norman may have been taking some policy advice from the former member Stuart Nash. Remember Mr Nash in this House last year talking about farming incomes?  
Hon Amy Adams 
: That’s right. 
MICHAEL WOODHOUSE 
: That is right—remember? He talked about gross incomes. Never mind that that is not what one pays tax on. One pays tax on net incomes. Well Dr Norman is telling half the story really really well because whether or not the cost of the tax cuts to the upper income earners was $2 billion that was just one element of about 13 or more separate levers to fiscal policy that this Government has made including increases to GST that have resulted in upper income earners paying much much more of that tax the removal of depreciation on residential and commercial rentals and the closure of a number of loopholes that were unintended consequences that benefited upper income earners in tax transfers like Working for Families student allowances and child support. Those loopholes were actually introduced by Labour and supported by the Greens. But the biggest one—the biggest one of all—was that the difference between the trust top tax rate and the top personal rates was so wide. I remember the Tax Working Group actually said that in the past we had one of the least distortionary tax systems in the OECD and then we went from that to one of the most distortionary under Labour.  
So although there was a reduction in the top personal tax rate in 2012 to remove that distortion it is completely incorrect to say that that had a cost of $2 billion. I much prefer to refer to the more independent and non-partisan commentaries of the accounting firm of Deloitte which in its 2011 Budget report confirmed that the 2010 tax switch was “indeed fiscally neutral according to the tax bands”. As far as I am concerned that argument was over more than a year ago. Dr Norman can go on and on and on all he likes but that does not make it any more true. Indeed those changes that we made meant that three-quarters of New Zealanders pay a top personal marginal tax rate of 17.5 percent. Half of all households pay no net tax at all and 17 percent—17 percent—of households pay 97 percent of the net income tax burden in this country.  
But Labour and the Greens say 97 percent is not enough. They would want to put that top tax rate back up and punish hard-working New Zealanders even more. We know what they would do with those tax increases. The cuts actually gave New Zealanders a choice and those cuts came across the board. They had a choice to either spend them save them or reduce debt with them. We now know what they did with them. They saved them and they reduced debt with them because our savings rate is going up and our private debt is going down. But Labour and the Greens do not think that the public should have a right to decide what to do with their money. They think they know better than the public how the public should spend their money. So they went to the electorate last year and they said: “We are going to take those cuts back off you. We are going to take that tax cut back off you because we know better how to spend it.” Well I think the electorate spoke very clearly about what it thought about that policy. It spoke then and it spoke now— 
Andrew Little 
: You’re making it up! 
MICHAEL WOODHOUSE 
: I would like to know what that member thinks I am making up because absolutely every one of these things has been verified. The people around him are not making any noises about it because they know what the truth of it is. They know what the positive impact of those tax cuts and fiscal prudence was. And that is what the electorate knew too because this Government does not treat the electorate like idiots. We can go to the electorate with tough decisions like partial floats like the mixed-ownership model— 
Dr Megan Woods 
: Like class sizes. 
MICHAEL WOODHOUSE 
: —yes like class sizes—that is right. And OK maybe there is another discussion still to be had but at least we are listening. At least we are listening and that is a damn sight more than the public is doing to the policies of those members. Who knows what those policies are? There is no alternative being thrown up except tax borrow and spend. I think the public has spoken very clearly about that. 
JACQUI DEAN (National—Waitaki) 
: 
 One of the things New Zealanders hold very dear is feeling safe in their homes. It is one of those things that my constituents hold very dear. In fact I know a number of people move to the South Island and to small towns in the South Island because that is where they feel safe. They feel safe going about their business they feel safe on the roads and they feel safe in their homes and that is something that I believe we will want for all New Zealanders all throughout New Zealand.  
That is why National embarked when it came into Government on a comprehensive programme of reform to protect our communities: to protect everybody in New Zealand on the roads at work and in their homes to prevent crime happening to New Zealanders and to put victims at the heart of the justice system. In the time that the National Government has been in power we have passed 80 new laws to do with the safety of New Zealanders. We have introduced pieces of legislation like the offender levy where $50 is taken from offenders and put towards the victims of crime. I was looking for the latest figure of how much has been gained from the offender levy and I am afraid I cannot find it. It is not to hand but I know that it is a significant amount and I know that that offender levy is making a real difference to the victims of crime in New Zealand.  
This Government has given victims more say in court with victim impact statements. This Government has put 600 more police on the beat—on the front line—in the small towns and the cities throughout New Zealand. This Government has provided tools to seize the proceeds of crime. Again the amount recovered from the proceeds of crime is indeed significant and that money is in turn being put to good use. This Government has brought in tougher sentencing and parole laws and now is looking at bail laws for all New Zealanders. We have tackled gangs we have tackled P and we are making significant gains on the importation of precursors of P. This Government has also worked on road safety and we now have the lowest road toll in 50 years.  
But of course that is not enough. Budget 2012 has a strong focus once again—and I am very pleased to see it—on law and order. Recorded crime is now at a 15-year low and the crime rate which is set at a rate per 100000 of population is at a 30-year low. Those are figures that are to be celebrated but according to the Minister of Police and Minister of Corrections Anne Tolley much more needs to be done. What a great attitude from our Minister of Police and Minister of Corrections. This is a Minister and a Government committed to making our communities safer with a focus now on prevention—that is preventing crime from happening and also reducing crime.  
Budget 2012 supports this target for safer communities for New Zealanders. It supports this target and builds on the achievement of less crime. This Budget reprioritises $65 million in operating expenditure over the next 4 years and this expenditure is targeted in certain directions. There will be 33000 offenders including remand prisoners accessing drug and alcohol treatment.  
This Government has already banned smoking in our prisons. It was probably about 1½ years ago that smoking was banned in our prisons—a move that has been reported to us in the Law and Order Committee as an outstanding success. There is cleaner air both for officers and for inmates alike improved health—of course—as a consequence of no smoke in the air and a decrease in standover tactics now that tobacco has been removed as a currency. I will never forget the day when the Department of Corrections came to the Law and Order Committee and showed us a video and photographs of fires in prisons. Prisoners wad up their bedding sheets or paper light it with their cigarette lighters throw it out into the corridor and watch the ensuing mayhem placing not only corrections officers themselves but other prisoners at risk as the corrections officers scramble to put out those fires. The incidence of fires is now virtually nil and so it would be fair to say that prisons are now a safer place for officers and inmates alike.  
The Corrections Amendment Bill has passed its first reading. This is a bill that will remove red tape allowing our prisons to operate more effectively and also importantly that makes improvements to both drug testing and strip-searching procedures. All these are measures to make our prison environments safer for all those who have to live and work in them.  
Budget 2012 provides for more rehabilitation places. Again the Law and Order Committee is to travel to Rimutaka Prison this week to have a look at this and I extend a welcome to any other members of Parliament who would like to come. It is a select committee trip but it is open to any other members who are interested in law and order issues and who would like to take part in this visit. This visit will have a look at rehabilitation programmes at work. These programmes are designed to equip prisoners with the skills to face the world outside prison when they get released. As part of Budget 2012 there will be 2950 more prisoners in education and training. There has already been a 45 percent increase in New Zealand Qualifications Authority credits gained by prisoners in trades training and work skills. It is pretty obvious is it not? The more work skills a prisoner has and the more trades training skills a prisoner has the greater the likelihood of getting employment on release; it is much enhanced. So too is there less likelihood of prisoners reoffending and ending right back where they began: in prison. It is notable particularly following the contribution by the member who was so fixated on the colour red in a previous contribution that in Christchurch there are 130 new places for trades training. Of course those are skills that are going to be sorely needed in the future in Christchurch and those skills are around building carpentry and those practical skills that are going to be sorely needed.  
Corrections has looked very carefully at the way it operates as part of an expenditure review and has identified the best investments with a view to reducing reoffending. By seriously addressing these contributors of crime—things like drug and alcohol addiction and lack of literacy and numeracy skills—we can reduce the likelihood of reoffending.  
Budget 2012 supports the police in working smarter and better. Of course by working more efficiently the police are providing a better public service to taxpayers which is a very strong focus of this Government and they have a real impact on crime rates in New Zealand. Police Minister Anne Tolley announced the Prevention First strategy late last year which outlines how police aim to prevent crime before it happens. Most important it puts the victim first ultimately making New Zealand a safer place to work and to live. The strategy also aims to reduce the number of crashes on our roads to give police greater control of the criminal environment to put the police on top and to provide a better service once again to victims. The Prevention First strategy puts prevention of crime at the forefront of police security. It allows police to be more proactive and work in a planned way. I was interested to hear a policeman say to me that gone are the days when the police car leaves the police station tosses a coin and then decides whether to turn left or right. Those days are gone. Now police are working more effectively and smarter.  
Budget 2012 supports front-line police with the provision of new technologies which gives them faster access to information so that they can make better decisions when they are out on the road and facing crime. As the Prevention First and Policing Excellence programmes continue to be rolled out police are on course to reach the target of a 13 percent reduction in crime by 2014-15. That is a big goal. This Budget supports that. 
ANDREW LITTLE (Labour) 
: 
 It is a pleasure to speak on the Appropriation Bill and the 2012 Budget. Whatever this Budget is a future for it is not a Budget for the future of New Zealand. It is miserly it is penny-pinching and it offers nothing for future wealth creation and future wealth building for New Zealand. What we have seen in this Budget—the headline issues for this Budget—is a tax on paper boys we have seen shifting the goalposts for elderly in their retirement and the support they get for their retirement homes we have seen more cuts in front-line services and we have seen a lot of rhetoric accompanying the Budget saying how wonderful it is for the future of New Zealand. It is all Alice-in-Wonderland stuff. It is head-in-the-sand stuff. It is out of touch. But the education changes that were announced in this Budget—or rather not announced but presumed and implied—are something else again.  
Let us recount what happened in relation to those education changes. The Treasury Secretary was deployed for the softening-up process. So he gave the interview and he gave the speech that signalled that class size was not the issue and that there would be changes in the Budget and changes in financing for education. Nobody knew what was happening. No signal was given about the precise changes. What has become quite apparent since the delivery of the Budget is that if Cabinet Ministers knew or even if some of them knew none of them asked the question and none of them reminded or told their colleagues about what the impact was going to be on the schools in their electorates and the schools around the country. No one asked the question.  
The sector itself did not know until the day before or even the day of the Budget. I met intermediate school principals who did not know what the impact was going to be until the morning of the Budget. That is how closely guarded this secret was. So the education changes in the Budget were much less Alice in Wonderland and much more “malice in blunderland”. That is what that was about.  
Budget 2012 offers nothing for the future of New Zealand. Where in the Budget is the foundation for future wealth creation? Where is the acceptance of the real and very serious and difficult problems facing New Zealand on for example superannuation financing and funding? What we do have from this Government and its economic and finance policy is partially selling State-owned enterprises—the State assets—a policy that we know is short-changing New Zealand in the long term. Even Treasury in its more honest moments tells us that the yield in terms of a sale price for those State assets will not make up for the return that the Government gets on those in the longer term. And we are not selling just State assets; now we are down to selling policy. So when it comes to gambling and when it comes to a convention centre in Auckland we will fund that through selling policy.  
If ever there was a matter that was a case of “malice in blunderland” surely it must be ACC. I want to take a few moments to talk about the ACC issue because this is serious. ACC is a very important institution in this country. It is 38 years old this year. It has been fundamental to good health and safety and to good rehabilitation and recovery for injured workers and for injured people and it is very important. It has long held a high degree of public trust and confidence. Its genesis was in a bipartisan decision of this Parliament to say that something had to change to provide for those who are injured by accident.  
It is unbelievable that many members opposite in their speeches on the Budget so far in this debate have referred to the wonderful ACC reforms engendered by this Government. So I want to talk about some of those ACC reforms because what we have now is this important New Zealand institution with its reputation in tatters all because of the approach this Government has taken in relation to ACC.  
The rot started under the previous Minister. One of the biggest political cons of a generation was when this Government announced and declared and persuaded everybody that ACC was in financial crisis. Never mind that for nearly 10 years ACC had been generating surpluses of $1 billion. Never mind that at that time it had reserves of nearly $11 billion. The Government announced that there was a financial crisis so it got rid of many board members and installed its specially recruited chairman John Judge who now is no longer on the ACC board at least. It recruited John Judge. It hiked up the levies totally unnecessarily and when it got a backlash from the bikies whose bikes it could not crush it had to backtrack at least on that part of it.  
It hiked up the levies and what has the impact of that been? What has the impact of that been? Well up to about 2008-09 ACC generated surpluses of about $1 billion. It used to spend about $2.5 billion to $3 billion on looking after people on paying for their medical treatment and medical costs and on paying their compensation. Well do you know what happened last year? What happened last year was that ACC produced a surplus of $3.5 billion. And do you know what it spent on looking after people? Do you know what it spent on the medical treatment and the care of people and compensation? It spent $2.9 billion. It generated a surplus greater than what it spent on every claimant who needed medical care and treatment and who needed earnings-related compensation. That is what it did.  
The National Government was so embarrassed about it that just before the election lo and behold it announced a reduction in the levies. That is how embarrassed it was about its big mistake. But the mistake did not stop there.  
Michael Woodhouse 
: Just apologise. 
ANDREW LITTLE 
: It will never apologise about it. It will never apologise about it because this is a Government that according to its own operations manual does no wrong—it does no wrong apart from Nick Smith. Nick Smith did admit that he did wrong and he did the honourable thing and stood down but no other Minister has done the same thing.  
That was not the end of National’s ACC reforms. It put John Judge in for a reason. It wanted to shake up the corporation. It wanted to get into a programme of cost-cutting penny-pinching and miserliness and it wanted to push back on legitimate claimants—people who had been injured through no fault of their own. It pushed back. One of those people happened to be one of its own—Bronwyn Pullar aided and abetted by another one of its own Michelle Boag. Of course hell hath no fury like a scorned ACC claimant who is a member of the National Party. And that is what happened.  
So what we had were the ACC reforms promoted by this Government to get rid of a good board and a good chair hike up the levies unnecessarily declare there is a financial crisis get into a dreadful programme of penny-pinching and cost-cutting and push back on legitimate claimants who are suffering who are in pain and who are just doing what every New Zealander has done for the last 38 years and that is to look to ACC for help and support. The Government has created a culture of disentitlement and then cut back on those things that are needed to manage claimants’ personal information needs carefully. Now we have an organisation whose reputation is in tatters where privacy breaches are endemic and where people are getting knocked back. These people are suffering exasperated distressed and depressed because of what this Government’s ACC reforms have done.  
The question is where the Minister is on this. Where is the Minister on this? What has she done? In the House today when asked what she had done and what her actions were she told us what everybody else had done. But what has she done?  
Her challenge now is having got rid of John Judge to issue a new set of instructions. Forget what the last Minister said forget what Nick Smith said and issue a new set of instructions. Unfortunately she has to issue them to Paula Rebstock so we do not know how much change there is going to be for this.  
But here is the challenge to the Minister: issue a new set of instructions. Tell your new board chair that we want an ACC that cares about the people who come to it for help and support. Look after those people examine the claims but look after those people and make sure that nobody who is entitled to support and assistance from ACC is disentitled rejected denied thrown out into the cold and left to battle the behemoth of ACC on their own as so many are at the moment. Issue a new instruction. Say we want a culture change and make a difference because never has a very important public institution in New Zealand which is so important to the life of New Zealand and the life of New Zealanders come under such sustained attack from the people to whom it is so important. Never has a public institution come under such sustained neglect from the Minister who is responsible for it.  
So that is the challenge. I look forward to this Government doing something new and good for ACC because that will be a change from the past 3½ years. 
LOUISE UPSTON (National—Taupo) 
: 
 I am very proud to stand and take a call in this Budget 2012 debate. Over the last couple of weeks since Budget day I have been taking the Budget to the people of the Taupo electorate which I am enormously proud to represent. I have had post-Budget coffee catch-ups in places like Tirau Putaruru Tokoroa Cambridge Taupo and Turangi. One of the things that has been quite interesting is that I have been surprised at the fact that there have not actually been many people who have been turning up with lots of questions to ask. I firmly believe that that is because they know that this is a Budget for our times. This is a Budget that is sensible that is moderate that is balanced and that perfectly fits the times we are in. It sets the path back to surplus but more important it has that balance right in terms of protecting those who need protection and also making sure that we have an economy that is heading in the right direction and that is growing albeit slowly—slowly and steadily. That is why I am proud of this Budget.  
One of the things that has been really important is to remind the people of my community about the broader context in which this Budget was delivered. I am staggered that some on the other side of the House tend to forget some of the major economic issues that this Government has faced. It came in after 9 years of Labour to not only a recession already under way a global financial crisis a continuing environment where there is still uncertainty in Europe and a space that is changing by the day but also the destructive earthquakes in Canterbury which have come with a price tag to the Crown of $20 billion. That side of the House tends to forget that that is the context in which this Budget has been set.  
The reality is that although we would like to have really certain times in front of us they are not and they are not going to be for quite some time. So this is a Budget that has taken that into consideration. But we have still managed to put new spending into the areas that matter—new spending into areas like science and innovation new spending into health new spending into education and new spending into reducing areas like my colleague Jacqui Dean spoke about before in terms of getting on top of crime. These are the things that people in my electorate say are important. So this Government is spending the money exactly where New Zealanders want it to be spent. We are managing the finances tightly we are building a more competitive environment we are making sure that the recipe is in place for businesses to grow and we are rebuilding Canterbury getting that city and that region back on its feet all the while with international challenges still in front of us.  
It is really interesting because what we are spending in Budget 2012 is exactly what New Zealanders are asking for—exactly what New Zealanders are asking for. However we are spending through savings. That should be no surprise to anyone in this House if they are in direct contact with the people they represent because that is exactly what individuals families businesses and community organisations are doing up and down this country. They do not have new wads of money that float through their doors on a daily basis. They are making do with what they have and that is exactly what this Government is demonstrating. It is not a “slash-and-burn Budget”; it is a responsible Budget. We have a very tight constraint on the spending we have and we are spending new spending on the areas that count to New Zealanders.  
If we look at health for example there is $1.5 billion going into health. Where is some of that spending going? Well it is going into things like faster treatment for people who have cancer. If anyone in this House has dealt with or spent time with someone in that situation they know that that is important to ordinary New Zealanders. So that is the priority on this side of the House and that is exactly what we are doing.  
In terms of welfare reform the approach that this Government is taking is saying: “Well actually we might have to spend a bit more money up front.” Spending the money up front to get families and individuals out of poverty and out of the welfare benefit trap is worth it. That is another area that New Zealanders up and down this country are saying they are supportive of. They support exactly what this Government is doing. New Zealanders are supporting exactly what we are doing.  
Let us talk education. 
Andrew Little 
: Yeah yeah quick. 
LOUISE UPSTON 
: Yes absolutely. I am very pleased to talk about education. I am very proud to be part of this side of the House and to be part of a party that has an unrelenting focus on lifting student achievement—unrelenting unrelenting. Do you want me to say it again? Student achievement is the focus of this Government—absolutely. In this one— 
Phil Twyford 
: How about those class sizes then? 
LOUISE UPSTON 
: Yes absolutely. I am more than happy to talk about the class sizes. What happened was that parents told us that they were concerned about where that might go. So what did we do? What did we do? We responded exactly to the feedback that we were given. And do you know what I have had since then? I have had texts I have had emails and I have had phone calls from people saying: “Thank you. Thank you for listening.” Do you know why members on that side of the House are so plugged in about it? It is because they never listened. They never listened. They never responded. They are so out of touch with ordinary New Zealanders. They cannot handle the fact that we are willing to say: “OK let’s say we are focusing on student achievement.” That side of the House clearly did not do it because it left one in five children behind and we are not willing to do that. We are not willing to leave one in five of our young people behind. That is clearly demonstrated in some of the results and some of the targets that we have set in our public services. Members opposite are going quiet.  
In early childhood education 98 percent participation is what we have set for our young people. If you ask any primary school teacher who teaches a new entrant class what makes the difference in terms of them teaching those children the answer is that it is early childhood education—absolutely. And we have been spending more money than Labour ever spent in 9 years in Government. 
Hon Maryan Street 
: Quite wrong. 
LOUISE UPSTON 
: Spending absolutely has increased and that side of the House just cannot handle it. What else have we set in terms of targets? The next one—and I am happy to say that it is ambitious—is to have 85 percent of our school leavers leave with National Certificate of Educational Achievement level 2 by 2016. That is going to be tough. That is going to be a challenge. But does this side of the House shy away from a challenge like that? Absolutely not because it is worth it. This side of the House is focused on results.  
One of the results that my colleague Jacqui Dean talked about in the area of law and order which is another area that is particularly important to the people of the Taupo electorate is keeping our families and our communities safer. If you look at the target that we have set in terms of reducing prisoner reoffending if we reduce that by 25 percent that translates to 18500 fewer victims every year—18500 fewer victims. That is the sort of thing that this side of the House is focused on and that is why New Zealanders are supporting what we are doing. They trust that our Budget our plan will get the results that they are interested in.  
I am proud of Budget 2012. I am proud of what we have delivered despite being in tough times. I recognise listening to my constituents on a daily basis that individuals families businesses and communities have been doing it tough. I recognise that and I hear it nearly daily. But this side of the House unlike those who live on “Planet Labour” does not want to wish away the recession. We are not pretending that there is no global financial crisis. We are not pretending that Canterbury does not come with a $20 billion price tag. We are actually taking the actions slowly surely moderately sensibly and deliberately which will get New Zealand where we all want it to be. Things are getting better. Our economy is growing slowly and surely. The number of jobs is growing—17000 in Christchurch alone. Business confidence is growing. Our major export markets of Asia and Australia are growing— 
Mr DEPUTY SPEAKER 
: Order! Your time has expired.  
Peseta SAM LOTU-IIGA (National—Maungakiekie) 
: 
 It is an honour and privilege to talk to this Budget 2012 debate. The context in which we assess this debate is to look back at 3½ years of this Government and what did we inherit? We inherited an economy that had some of the highest interest rates in the world—over 10 percent. Labour’s grave legacy was 5 consecutive years of contracting exports. Treasury forecasts were particularly grim with predictions of deficits that would go out over 10 years.  
The prolonged global economic recession the Christchurch earthquake and Labour’s economic mismanagement have led to a long dark night in our history. However after a long dark night this Budget represents morning again in New Zealand. It is morning again in New Zealand because this Budget will balance the Government’s books by the year 2015. It is morning again in New Zealand because this Budget delivers better Government services. It is morning again in New Zealand as this Budget builds a more productive and competitive economy.  
Under this National Government the economy has steadily built up to the point where this morning 2230000 New Zealanders went to work—more than at any time in our history. Interest rates are at historic lows under 5 percent today whereas they were over 10 percent in 2008. Finally inflation was over 5 percent in mid-2008 and it is now at a low of 2.1 percent.  
The Opposition has asked in this debate why it is important to balance the books. Well it is important because as we look around the world there are danger signs of countries where out-of-control debt has brought nations to their knees. In Greece where crazy debt levels have led to a €130 billion rescue package for an economy that is only— 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. I apologise. I know that we are having problems with our speaker system and getting people’s voices out uninterrupted to the world but I think there has been an overcompensation. If you could ask— 
Tim Macindoe 
: This is not a point of order. 
Mr DEPUTY SPEAKER 
: Order! 
Hon Trevor Mallard 
: If you could ask for the system to be turned down a little in the House. I am a member who is slightly hard of hearing and I will have trouble staying in here at that volume. 
Mr DEPUTY SPEAKER 
: I think that message has percolated to those who might do that. 
Peseta SAM LOTU-IIGA 
: In Spain unemployment has hit 24 percent. The banking sector is in crisis there facing serious downgrades and an imminent recession. But this National Government will not allow that situation to happen here. It is through fiscally responsible policies prudent economic management and sound common-sense leadership that we will make this country bolder brighter and better again.  
So you may ask what this Budget does to balance the books. Well we have closed tax loopholes around livestock and mixed-use assets to save $293 million over 4 years. We have removed tax credits where they were no longer serving their purpose and this will save $117 million. But what is critical is that net core Crown debt will remain below 30 percent which is a gold standard compared with other developed countries. Significantly we are reprioritising $4.4 billion over the next 4 years to ensure that New Zealanders receive better public services in health education social services and science and innovation. Why are we doing this? We are doing this because these are the areas that matter to New Zealanders most.  
What has been clear in this debate is the ideological differences between those tired Opposition benchers and the Government’s aspirational benchers. In a Harvard study economists Alberto Alesina and Silvia Ardagna investigated policies aimed at stimulating the economy in 21 countries between 1970 and 2007. Their conclusions were unequivocal and I will quote: “Fiscal stimuli based upon tax cuts are more likely to increase growth than those based on spending increases.” They added that spending cuts are much more effective than tax increases— 
Mr DEPUTY SPEAKER 
: I am sorry to interrupt the member but the time for this debate has now concluded. I call on the Minister of Finance the Hon Bill English in reply if he wishes. 
Hon BILL ENGLISH (Minister of Finance) 
: 
 It has been interesting just to hear the Budget debate wandering along. I must say that the attitude the Labour Opposition brought to the House today is pretty much the one that it has carried throughout the debate. There is no focus no real energy and no sustained intellectual effort that illustrates any attempt to get to grips with the way the economic world has changed and where Budget 2012 fits into that. In fact you would think with the way the Opposition turned up to the House today that it must have made some announcement a while ago and then turned round and changed its mind on it. That is what you would think had happened. I cannot recall an Opposition that was meant to be opposed to a Budget coming into the House with such a weak performance as today’s. It was unbelievable actually and reflects a kind of lassitude that can be explained only by the profound depression the Opposition members must feel at their inability to get a grip on political debate— 
Hon Maurice Williamson 
: Resign. 
Hon BILL ENGLISH 
: —as my colleague has suggested before I think the Opposition should resign. I can tell you one reason why that is. The Labour Party in particular and to some extent the Green Party are quite disorientated by the way this Budget deals with public services. There is a lot of commentary about the general economy and I can come back to that but— 
Chris Hipkins 
: Deals to public services. 
Hon BILL ENGLISH 
: Well that is exactly my point—that is exactly my point. The New Zealand centre-left parties have been waiting around for when the wolf rips off its sheep’s clothing sacks half the Public Service and shuts the hospitals and then they will get their diet of media stories that enable them to put their feet up and say: “The world is the way we always thought it would be. The nasty Nats don’t care about anybody. We do and in the end they’ll vote for us.” It is not happening.  
A striking feature of this Budget and the election campaign is that all those people who at the ballot box actually do support the Labour Party are working so constructively with the Government on public services and on solving our social problems that we did not hear a word of criticism—not in the election campaign and not around this Budget—with one exception. That was over the pupil-teacher ratio and that was so obvious because it was exceptional. [ 
Interruption 
] Clearly the member does not know what Budgets used to be like when they were tight. Everybody complained about everything in the Public Service but not now because this Budget includes large investments in aspects of public services that the previous Labour Government disgracefully neglected or incompetently messed up.  
But actually no one really cares about what Labour did because there are a whole lot of people out there constructively engaged with the National - John Key - led Government on for instance taking some serious action about long-term welfare dependency. Labour members wrung their hands about it while it got worse throughout the most favourable employment conditions in a generation. The centre-left who support Labour now realise that writing strategies and wringing your hands does not work and they are constructively engaged with this Government with this Cabinet in major change in how we deal with welfare issues health issues and education issues.  
I will give just one very simple example which is immunisation rates. For 30 years immunisation rates particularly among Maori and Pacific children those who need it most have been below 70 percent and today they are above 90 percent—above 90 percent—not because of strategies workshops and consultants but simply because this Government said: “We don’t accept that. We think it can be better and if we tell people it can be better they’ll do the job.” The public health service has done a fantastic job of lifting those immunisation rates. There is now no difference in immunisation rates between Pakeha children and Maori children even in difficult areas like the Bay of Plenty. That is just one example. It did not actually take a lot more money but it did take some more money.  
The other examples are particularly around welfare where the bankruptcy of the New Zealand Labour Party is becoming more obvious by the day. Not a single idea has it contested around the single biggest allocation of funding in this Budget which is well over $250 million to welfare reform—not a word not a word. The reason is that Labour has no idea how to deal with it how to put up a better idea or how to politically contest what National is doing. What we are doing is moving on from the dreadful passivity of the previous Labour Government which said: “Because we care about our most vulnerable people we don’t actually have to do anything to stop them being vulnerable.” The sneaking suspicion is that what drives the Labour Party is that it wants people to be dependent because then it needs to get them a State house and it then needs to have workshops consultants and statisticians running a whole industry talking about it.  
This Government believes that people do not need to be vulnerable. They are not there as fodder for our political machine like they are fodder for the Labour Party political machine. We have committed over a quarter of a billion dollars in this zero Budget to doing more to help more people whom we believe can move out of dependency. The other benefit of it might be that they then stop voting for Labour. Would that not be fantastic? That would be a real measure of success.  
That is why the Budget debate has been a bit lacklustre because the once-great Labour Party has nothing to say that is relevant to the issues of the day. Labour members just harp on with decades-old slogans and hope that somehow we will stuff up public services enough that that will feed their political strategy. It has not happened despite 4 years of tight Budgets. We will deliver more and better public services for less and the delivery system that supports the Labour Party in the ballot box supports us—this Government—in the work it is doing and in what it wants to achieve for New Zealanders who depend on us.  
In a context of global uncertainty and a bumpy and slow recovery in the New Zealand economy this Budget is a sensible one. It is a sensible one. It is another step along the path of rebuilding the growth capacity of this economy building on the resilience of so many New Zealanders who have done a fantastic job of adapting to the way the world has changed. At times they are frustrated and at times they are impatient but at all times they are resilient making the changes they need to make so they can secure their jobs have viable households get their debt down and look to the future with some aspiration. This Government has never lost its sense of aspiration through these more difficult times and we look forward to presenting a Budget next year that builds further on the aspirations we have for a brighter future. 
A party vote was called for on the question  
That the words after “That” be omitted and the following substituted: “this House has no confidence in this National Government led by John Key because year after year it has failed to deliver the economic growth and the growth in jobs incomes and exports it promised which has forced record numbers of New Zealanders to look for better opportunities in Australia has failed to take the tough decisions needed to generate the economic growth to keep young New Zealanders at home and as a last resort is selling our most valuable assets against the will of New Zealanders.”  
Ayes 57 
New Zealand Labour 34; Green Party 14; New Zealand First 8; Mana 1. 
Noes 63 
New Zealand National 59; Maori Party 2; ACT New Zealand 1; United Future 1. 
Amendment not agreed to. 
A party vote was called for on the question  
That the Appropriation (2012/13 Estimates) Bill be now read a second time. 
Ayes 63 
New Zealand National 59; Maori Party 2; ACT New Zealand 1; United Future 1. 
Noes 57 
New Zealand Labour 34; Green Party 14; New Zealand First 8; Mana 1. 
Bill read a second time. 
Appropriation (2011/12 Supplementary Estimates) Bill 
First Reading 
Hon BILL ENGLISH (Minister of Finance) 
: 
 I move  
That the Appropriation (2011/12 Supplementary Estimates) Bill be now read a first time. 
A party vote was called for on the question  
That the Appropriation (2011/12 Supplementary Estimates) Bill be now read a first time. 
Ayes 63 
New Zealand National 59; Maori Party 2; ACT New Zealand 1; United Future 1. 
Noes 57 
New Zealand Labour 34; Green Party 14; New Zealand First 8; Mana 1. 
Bill read a first time. 
Local Government Act 2002 Amendment Bill 
First Reading 
Hon DAVID CARTER (Minister of Local Government) 
: 
 I move  
That the Local Government Act 2002 Amendment Bill be now read a first time. 
 I nominate the Local Government and Environment Committee to consider the bill. At the appropriate time I intend to move that the Local Government Act 2002 Amendment Bill be reported to the House by 15 October 2012. 
Can I start by acknowledging the excellent work of my colleague Nick Smith and his work in developing the Better Local Government reforms. 
New Zealand’s 78 local authorities are a significant component of the New Zealand economy. They make up 4 percent of GDP spend $7.5 billion per year of public money and manage $100 billion worth of public assets. They deliver a wide range of critical regulatory functions and local public services that directly impact the lives of New Zealanders every day. Central government has a part to play in creating an environment in which local government is better able to contribute to building a more productive and competitive economy and to deliver better local public services. Local government can then be better positioned to create the environment for local businesses and industry to emerge and grow and for communities to flourish. This Government’s programme for reform of the local government sector aims to improve the operation of local government here in New Zealand. It will focus local authorities on operating more efficiently and effectively by doing things that only they can do. It will deliver settings that will encourage local authorities to reduce red tape and compliance minimise rates for households and businesses lower their debt and provide high-quality infrastructure at the least possible cost. 
The Government’s programme for reform of the local government sector comprises two distinct phases. The first phase will refocus the purpose of local government introduce financial prudence requirements for local authorities strengthen local authority governance provisions and streamline local authority reorganisation procedures. The second phase of the reform programme will consider the report of the Local Government Efficiency Taskforce which I announced last week. It will also develop a framework for the interface between central and local government regulatory roles investigate the efficiency of local government infrastructure provision and review the use of development contributions. 
This bill the Local Government Act 2002 Amendment Bill amends the Local Government Act 2002 to give effect to the first phase of the Government’s reform programme. Firstly the bill refocuses the purpose of local government. The purpose in the bill provides for local authorities to meet the current and future needs in their communities for good quality local infrastructure local public services and performance of regulatory functions in a way that is most cost-effective for households and businesses. Having a clear and focused purpose statement is necessary for the efficient running of local government in New Zealand. 
The second area of reform is the establishment of financial prudence requirements for local authorities. In line with central government and households and businesses councils must restrain spending keep costs down and run as efficiently and effectively as possible. In building a more competitive and productive economy it is critical that both local and central government take a prudent financial approach to public money. This bill provides for regulations to set benchmarks for the prudent overall management by councils of revenue expenses assets liabilities investments and general financial dealings. 
The bill contains three mechanisms to strengthen local authority governance provisions. There will be provision for a simpler more graduated mechanism than is currently available for central government to assist struggling local authorities and intervene before situations become critical. In particular the new mechanisms can be used where local authorities are failing or are close to failing the new financial prudence requirements. The leadership roles of mayors will be strengthened in line with that of the Auckland mayor under the Local Government (Auckland Council) Act of 2009. Mayors will be given governance powers that will align with the level of public responsibility they have for council decisions and that will support clear strong leadership by mayors. Elected councils will be specifically enabled to determine policies on staff numbers and remuneration and they will be required to report annually on staff employed by salary bands. 
The fourth area of reform in the bill is the streamlining of local government reorganisation procedures for the union abolition and constitution of districts and regions and the creation of unitary authorities. Currently such reorganisations can proceed only if they are supported by more than 50 percent of the votes cast in each affected district or region and reorganisation involves a long and complex process. This bill will make it easier for communities and local authorities to apply for a local government reorganisation and it will give the Local Government Commission more flexibility in considering applications. Reorganisation applications will need significant community support before the commission can progress them. 
The Local Government Act 2002 Amendment Bill is an important milestone in progressing the first phase of the Government’s programme for reform of the local government sector. These reforms are important for New Zealand communities for business and industry and for individual households. I believe that these changes will improve the efficiency and effectiveness of local government and provide the right settings for the local government sector to play its part in growing the New Zealand economy. I commend this bill to the House. 
PHIL TWYFORD (Labour—Te Atatu) 
: 
 I am standing in for my colleague the Hon Annette King and I rise to express Labour’s opposition to the Local Government Act 2002 Amendment Bill. Labour would support a bill that promotes efficient effective and accountable local government but this bill is not that. This is a politicised attack on local government. It will undermine democratic processes and it takes away the democratic rights of local communities.  
The reforms in this bill are based on a manufactured set of statistics a selective use of data by the Hon Nick Smith in a way that has become that former Minister’s trademark. We saw it earlier in the last parliamentary term with his stewardship of ACC. He whips up a few shonky figures puts them out into the media scaremongers up a good crisis and then pretends to bring a solution. That is exactly what happened here although it is interesting to note that after the data that these reforms were based on were posted on the Department of Internal Affairs website in a Better Local Government document a few days after that document’s release the data was replaced by the department with a comment saying and I quote directly from the website: “there are issues with the data both in terms of accuracy and in terms of the picture that was being given to some councils.” That is not a very promising start to this Government’s local government reform agenda in its second term.  
The main issue that I want to speak to in this contribution is about the change to the rules around the reorganisation and amalgamation of local councils. Currently the law guarantees to all citizens in this country the right to a say in a binding ballot over any proposed reorganisation or amalgamation of their local council. This bill takes away that right. It is the confiscation of the democratic rights of New Zealanders and it opens the door to forced amalgamations in which the citizens of the affected areas will risk having no say at all. Let me repeat—at the moment citizens are guaranteed the right to have a say. They can vote up or down any amalgamation proposal. What did we see from this Government in 2009? It circumvented that right with the forced amalgamation in Auckland. What is the Government doing? It is incorporating that approach into this piece of law.  
If citizens want to have a say then they have 40 working days from the time the organisational change proposal is tabled. They have got 40 working days to get 10 percent of the local voting population to sign a petition seeking the right to have a say in a binding ballot. That is simply not good enough. This is an assault on the democratic rights of communities all around New Zealand. It opens the door to forced amalgamations and that is a broken promise by this Government.  
Last term we heard John Key saying and we heard other National Ministers saying there would be no forced amalgamations. John Key said in March this year and I quote from his post-Cabinet press conference: “We think it’s very difficult for communities to amalgamate again there’ll be some discussions about that with the councils to amalgamate but I wouldn’t look for a forced situation as you saw in Auckland.” Well that is exactly what this bill opens the door to. It takes away the democratic right of New Zealanders to choose the shape and the scale of their local authorities. It takes away their right to a binding ballot. That opens the door to forced amalgamations. It is exactly what John Key promised would not happen.  
That has become this Government’s modus operandi. We saw it in Auckland and we saw it in Christchurch with the sacking of Environment Canterbury the removal of the elected councillors of the Canterbury region. We see that same contempt for democratic values the same contempt for our democratic institutions. It is coming through loud and clear in the Hon Nick Smith’s reform agenda brought to the House today by the Minister of Local Government David Carter.  
There is lots more that is wrong with this bill and I want to focus on a couple of other elements. What we see in this bill is the reincarnation of Rodney Hide’s ludicrous core services agenda. It survives here in a diluted form. What it does is it gets rid of the purpose statement in the current local government legislation which is often referred to as the four well-beings. It replaces that with a narrower focus of providing good quality infrastructure plus local public services and regulatory functions at the least possible cost to households and businesses. Well as many commentators have already pointed out this is a nonsense. The regulatory impact statement says this change is likely to have a symbolic effect and should not affect council business as usual.  
The absurdity of this provision is illustrated by the interview that the Minister gave on  
Q+A 
 a few weeks ago. He was asked what sort of council activity he did not approve of. His example that he gave was the Hamilton V8 Supercars race. Apparently councils running V8 races is bad but the Christchurch flower show— 
Grant Robertson 
: That’s fine. 
PHIL TWYFORD 
: That is really good. This illustrates the absolute intellectual bankruptcy that underpins this bill. V8 races are out; flower shows are in. So this is the kind of intellectual rigour this is the intellectual rigour that we have come to expect from this National Government. If Nick Smith who is often touted as having the biggest brain in the National Cabinet when he was in Cabinet is responsible for this reform agenda and he is the brightest guy in the National Cabinet then this country has got something very serious to worry about.  
The Department of Internal Affairs in the regulatory impact statement takes a much more sober assessment of this issue. It says: “There is no clear quantitative evidence to suggest that the [Local Government Act 2002] has resulted in a proliferation of new activities or that local government is undertaking a wider group of functions.” The regulatory impact statement by the Minister’s own officials contradicts the very premise that this reform agenda is based on. Nick Smith went around the country saying that the sky is going to fall councils are out of control they are spending here and there they are profligate and the four well-beings have led to an explosion of council activity doing all these outrageous things and that is contradicted by the Minister’s own officials and the regulatory impact statement.  
The other main idea that underpins this bill and this reform agenda is the notion that council debt is out of control and that councils are racking up more and more debt and this is a terrible liability. Well we have seen from Local Government New Zealand clear evidence that local authority expenditure as a percentage of GDP is more or less static at around 3 percent and has been for the last 5 years. We see that local authority expenditure as a percentage of total Crown expenditure is more or less static. In fact it has gone down by several points in the last 5 years. The figures show that council expenditure on interest repayments as a percentage of operating income was 4.53 percent in 2010 up from 4.19 percent in 2009. It is a hardly a crisis. The irony is that at a time when councils are being diddled out of a fair share of funding for local roads which for many councils is up to half their operating expenditure this Government is beating them with a stick about overexpenditure when it is cutting back on the funds that councils rely on just to repair and maintain local roads.  
The sinister thing about this Budget is that it is designed to put the fiscal squeeze on local authorities at the very time that this Government is trying to pressure councils in Auckland Christchurch and goodness knows where else to sell assets that their ratepayers have paid for and built up over generations. This Government is trying to do to local government what it is doing to central government and that is to sell off the family silver and sell off lucrative assets that are owned by the people of those communities. This is an illogical poorly thought-through bill. It takes away the democratic rights of communities it undermines local government and Labour will not support it.  
NICKY WAGNER (National—Christchurch Central) 
: 
 It is very interesting to listen to the member Phil Twyford and think that there is absolutely no correlation between what he says and what is happening in the real world out there. He has no knowledge at all of what is happening globally or in the economy. As the world changes socially and economically as new technologies develop and as new issues arise how we organise our lives our cities and our institutions needs to change as well. This Government is introducing these local government reforms as part of our focus on developing a more competitive and more productive economy because that is what is going to give us a better future in the long term. We want to use our resources more wisely. We want to get more for less out of our institutions and our organisations. We want to manage our finances better. We want to reduce waste and get better value for money in everything we do.  
The Local Government Act 2002 was supposed to improve local government management and we were assured—if you can remember back to 2002—that it would not add any significant costs but it did. Over the last decade rates have become more and more unaffordable for many more people. In the last decade rates increased by an average of 6.8 percent every year. That is double the rate of inflation. Operational costs have ballooned out. Local government salary costs are significantly higher than central government or private enterprise costs. Local government debt has quadrupled from $2 billion to $8 billion. Whatever you say more debt is bad. It increases uncertainty and increases liability. While households and businesses are being prudent and responsible—they have been belt tightening they have been managing their costs and they have been paying down debt—local government costs continue to rise. In the face of global financial pressure and monetary uncertainty ratepayers are becoming increasingly anxious and concerned about paying their rates and ongoing rate increases. Ordinary households and businesses have absolutely no control over rates. They have no choice but to pay those rates and they want to see councils tighten their belts too as they have done themselves.  
While working on the Local Government Act 2002 Amendment Bill local government Ministers have met with Local Government New Zealand mayors right across the country regional council chairs regional chief executive officers and numerous ratepayer groups in order to understand the issues and to formulate these amendments. This bill is the first phase of local government reform but it really focuses on four main initiatives. The first is to refocus the purpose. It is all very well for Mr Twyford to say that that will not make a difference but ratepayers tell us that what they want from their councils is reliable and effective infrastructure and they want efficient public service at an affordable cost. That is what they want so we are going to reword the purpose to cover that. We are going to say “to meet the current and future needs of communities”—so current and future thinking into the future—“for good-quality” not rubbish but good quality “local infrastructure local public services and performance of regulatory functions in a way that is most cost-effective for households and businesses.” We believe that this will focus councils on the roles and the duties that are of most value to ratepayers but it will still allow for individual differences for those communities.  
Ratepayers also tell us that they want the best possible financial management by their councils and that makes good sense. We want to introduce consistent financial prudence requirements across local governments and that means introducing regulations that will allow for financially prudent parameters and benchmarks. Under present legislation—the famous 2002 Act by Labour—councils already have to exercise prudent financial management and they have to exercise prudent stewardship of their resources. But if we can develop benchmarks for this process—and they will be developed with the consultation of Local Government New Zealand—that will allow a greater understanding for everybody and greater transparencies in finance for everyone. Because financial management will be consistently measured across the country it will be far easier to see when a council is out of step or a council is performing poorly and it will be far easier to identify when a council is struggling and might need Crown assistance or even require intervention. 
Ratepayers also tell us that they want councils councillors and mayors to be more responsible to the people who elect them. We want to strengthen council governance by giving mayors a stronger leadership role so that they can have that role over developing plans policies and budgets and we want to give them the power to appoint deputy mayors and also the chairs of committees so that when they go and take charge of a council they can make sure that what they have promised can be delivered. We also want to give more powers to councillors. When you think about it staffing and salaries are the major drivers of increased costs in councils. Presently councils have absolutely no control over these matters. We want to make sure that councils are able to set employee numbers and salary scales and we want them to report on that salary information in their annual reports. We believe that these measures will make councils more conscious of the cost and more accountable to the public.  
The ratepayers also tell us that they are open to change in the structures of local government if it gives them better efficiency. We want communities and councils to have more flexibility in developing reorganisation proposals. The current process that is being used is lengthy it is complex it is expensive and it is actually rarely successful—very rarely. We want to empower communities and councils to make changes that have the potential to achieve efficiencies and better decision-making. The new legislation will make it easier for the community-led local government reorganisation to succeed and it will also give greater flexibility to the Local Government Commission to develop reorganisation proposals. There is absolutely no doubt that effective and affordable local government is essential for the running of every New Zealand household and business. I think that this amendment bill is designed to provide a better understanding of councils’ roles. It should give us stronger and more effective governance improved efficiency and more prudent financial management. I commend this bill to the House.  
GRANT ROBERTSON (Deputy Leader—Labour) 
: 
 Listening to that member Nicky Wagner I wonder why the Government does not just fold all of local government up and get Paula Rebstock to run it because that is basically the Government’s approach to everything at the moment: “Let’s just corporatise the whole thing have a board and have Paula Rebstock run the whole thing.”  
It is important to see this bill the Local Government Act 2002 Amendment Bill in the context of what this Government has done with local government since it got into office in 2008. It inherited the Royal Commission on Auckland Governance. Everybody in the Auckland region wanted something to happen wanted a more efficient process and wanted better decision-making. The royal commission came through and this Government came along and ripped out sections of the report. It just said “No we don’t like that bit of it we don’t like that layer of governance so we’re going to take that out. We don’t like the idea that social issues might be dealt with so we’re going to take that out as well.” That was the first step when it came to local government from this Government opposite.  
Then it moved on to Environment Canterbury. The then Minister responsible for these things said the Government was not going to have an election on that issue. It would just cancel that because the Minister was worried about the outcome. That was the quote. It was in the  
Timaru Herald 
. I remember it well. The former Minister is nodding. He was worried about the outcome. Well I tell you what I was quite worried about the outcome of the 2008 general election but we did not cancel it. We did not say no we were not going to have it because we were worried about the outcome. But that is what this Government did when it came to Environment Canterbury. It said to good people like Eugenie Sage: “I’m sorry that’s it. You’re out. We’re not going to do this because we’re worried about the outcome.”  
Well there is the small matter of democracy. It is a tiny matter that this Government does not seem at all interested in protecting—certainly not at a local level. Because now the Government having tried to disembowel the royal commission report and having taken out Environment Canterbury is going to do it to everybody. Satisfied as it is with what it has done in Auckland and Canterbury the Government has come along and said it is time to get rid of democracy at a local level right across New Zealand.  
I want to focus in on the most insidious part of this bill and that is the fact that the rights of local residents to have a say on the organisation of the governance in their area is taken away. The automatic right to a referendum is gone under this bill. Gone! That is an attack on democracy. That is saying to local residents that they do not automatically have a right to have a say about how they are governed at a local level. That is wrong. Local people deserve a say in local decisions. What we now have is a process by which yes a poll a referendum can be requested; it has to be requested by 10 percent of the voters in an area. And to get those 10 percent the people who are trying to organise a petition have 40 working days. They have 40 working days from when a proposal is approved by the Local Government Commission.  
In the Wellington region here should a proposal come forward for a so-called super-city for the Wellington region that will be around 48000 signatures to collect in those 40 days. They cannot start any earlier than when the proposal comes up and that is as good as it gets. It is democracy if you can pull off that 10 percent. It is not democracy for everybody in the region. It is wrong and that is an attack on our democracy. This bill today takes away democratic rights. What kind of Government comes to this House to take away people’s democratic rights? This kind of Government does—a National Government that is determined to see all of local government in the sense of corporatised board-like relationships rather than it being part of democracy rather than it being something that local people have a say in.  
What we have today in front of us is a bill that effectively says that amalgamations will be coming. “You will get them no matter what.” Now some amalgamations may be a very good idea indeed. But local people deserve the right to a say not to have to go out and work to have a say—they actually deserve a right to have a say about what the structure of governance will look like in their area. This bill strips that right away.  
The word “flexibility” keeps being used but the question I have got to ask is how we balance flexibility streamlining against people’s right to have a say in how they are governed. This bill gets that balance all wrong and it should not be allowed to pass.  
The other part of this bill that I do want to put some time into is the question of the change from the removing the four well-beings from the 2002 Act because there has been a lot said about the fact that councils are somehow out of control—that they are completely out of control with what they are doing as a result of the 2002 Act. To repeat what Mr Twyford has said the Department of Internal Affairs says there is no clear quantitative evidence to suggest that the Local Government Act 2002 has resulted in a proliferation of new activities or that local government is undertaking a wider group of functions. That is the Department of Internal Affairs. That is the Minister’s own advisers saying that actually the whole premise of that change does not even stack up. As Mr Twyford said before frankly the Government does not even know why it is changing this particular clause. It wants to look like it is somehow or other going to streamline and narrow what it is that local government can do. But the reality is that the Government does not know. Is it the V8s or is it the flower show?  
Now some people might argue that that is evidence of Maggie Barry’s influence over this Government—flower shows are in. David Bennett has no influence—V8s are out. That could be one argument for what is driving—[ 
Interruption 
]—Tim Macindoe. Sorry I forgot. Maggie Barry is in the ascendency; Tim Macindoe and David Bennett are out. Flower shows versus V8s. But actually I think it is simpler than that. The Government wants to look like it is making a change in this area when in reality it is actually not. But what worries me more is that this is happening in the context of a time when the Government at a central government level is bailing out of important public services. It is saying that it is not going to be providing the kind of support in housing health and all the areas that we think of as central government’s role. Yet at the same time the Government is trying to tell local government that it should not be in those areas either. But it is confused. It does not add up it does not actually make any sense in terms of what councils will be directed to do.  
And here we have the Auckland Council with its magnificent new plan founded on the four well-beings—sorry not quite sure we fit into those any more! I have a prediction: I think they probably will be able to fit everything into the new structure because this Government simply does not know what it means by its new purpose statement for core public services.  
The other premise on which this bill flounders is the fact that the questions around debt and around the state of councils have not been accurately portrayed by this Government. Once again Local Government New Zealand’s figures show that the average of all councils’ expenditure on interest repayments as a percentage of operating income in 2010 was 4.53 percent. Now it has gone up. It has gone up from 4.19 percent which is not that big an increase. It is a small increase on average. [ 
Interruption 
] The former Minister can pick out examples if he likes but the truth is that the figures have been beaten up. The figures have been beaten up to try to make the case and it does not make the case.  
The Auditor-General said that debt levels were well within prudent financial standards. That is what the Auditor-General said about local government. Of course ratepayers want to see good efficient public services provided by their councils. Of course they want to make sure and there will be things we can do but premising widespread amalgamations forced on local people premising this whole bill on statistics that do not add up is not good enough. The Government needs to be able to come through with proper proposals—consulted with the sector—that actually will improve the way that local government works. There are bits and pieces of it in this bill but the reality is that the fundamental changes that have been proposed here are anti-democratic and are based on things that actually do not add up.  
But in the end I want to finish with saying where is all this ending up. Where all this is ending up is what the Government would like to force local government into doing and that is asset sales. It is quite clear that is the agenda. In fact I do not need to say it. John Key and David Carter have said it in the context of Christchurch. They want local government to shed assets. They want to take the harebrained scheme that this Government is trying to put in place—in the absence of any kind of real plan for economic growth—to sell assets and they want to transfer that on to local government. That is wrong. It is wrong in principle but it is also wrong in practice taking away the rights from local government to make decisions taking away the rights from local people.  
We are opposing this bill because although there may be some good streamlining of local government that could take place and there may well be good amalgamations out there that could happen they should not be brought about by taking away democratic rights from people by taking away the rights of individual citizens to decide how they are governed. This bill is wrong and the Labour Party opposes it. 
EUGENIE SAGE (Green) 
: 
 Tena koe Mr Speaker. Local government has an enormous influence on nature on our quality of life on our neighbourhoods and on the way our communities function. It has a crucial role in creating the places and communities that are safe and pleasant to live play work and retire in.  
The Local Government Act was significantly overhauled and changed in 2002. The intention then was to empower local communities. Local authorities were intended to be the instruments of local democracy through which communities achieved the outcomes they aspired to. This bill winds back that philosophy. It winds back the philosophy of councils being the instruments of their communities. By changing the purpose of local government and dropping the requirement to promote the four well-beings it will restrict councils to nuts and bolts activities. This potentially prevents them from being the arm around their communities from undertaking activities such as the very successful Christchurch City Council’s KidsFest school holiday programme or from providing affordable rental accommodation. As the regulatory impact statement on the Better Local Government discussion paper notes there may well be unintended consequences around changing the purpose of local government because that whole concept of well-being is woven throughout the principal Act and throughout the whole framework of local government. 
 In relation to changing the councils’ purpose this Local Government Act 2002 Amendment Bill is a solution—and a very poorly conceived one—looking for a problem. That is because section 11A of the principal Act already requires councils to “have particular regard to … core services … (a) network infrastructure: (b) public transport services: (c) solid waste collection and disposal: (d) the avoidance or mitigation of natural hazards: (e) libraries museums reserves recreational facilities …”. It was not just the regulatory impact statement that said there was no evidence of a proliferation of council activities since 2003; it was also the report of the Local Government Rates Inquiry in 2007.  
So the Green Party is opposing this bill. One of the other reasons is that it takes the “local” out of “local government”. It will mean that councils are potentially much more under the thumb and direction of Wellington and that is because the bill gives the Minister huge powers to intervene and effectively direct what councils do. So instead of local councils and central government operating in their own spheres with councils accountable to local electors we will get a very strange hybrid. We will have local councils that will always have their eye on Wellington and that will be quite nervous of the Minister intervening through the appointment of Crown observers Crown managers or a Crown review team or through the ultimate sanction of sacking elected councillors and replacing them with appointed commissioners.  
These ministerial intervention powers concentrate much more power in the executive. They undermine local autonomy and they give the Minister very wide discretion to intervene because of the very generous way in which the trigger for intervention is defined. It is defined as a “significant problem” and how is “problem” defined? It is “a matter or circumstance relating to the management or governance of the local authority that detracts from or is likely to detract from its ability to give effect to the purpose of local government within its district or region;”. That allows a huge amount of subjectivity in the Minister’s decision. If it is easier for the Minister to get involved he or she is more likely to as the Minister did in Canterbury and that will cut across democratic decision-making and it will cut across the fundamental principle of having no taxation without representation. What is most galling under this bill is that if the Minister appoints commissioners it is not central government that pays for them; it is local electors and local ratepayers who are expected to.  
Certainly there have been some well-publicised examples of poorly managed council expenditure such as the V8 race in Hamilton and Kaipara’s costly sewerage system but most councils are getting on with their job efficiently and effectively. Most councils are doing it in a financially prudent way. They have a financial strategy they have a revenue and finance policy and they are audited by the Auditor-General. In a recessionary climate we are already seeing in this year’s round of annual plans councils cutting and adjusting their spending.  
If expenditure is capped and limited to no more than the ratio of the population growth multiplied by the rate of increase in the Consumers Price Index this is potentially going to encourage councils to neglect investing in upgrading and maintaining their infrastructure potentially burdening future generations with an increased cost. As the law firm Simpson Grierson has noted benchmarking expenditure to the Consumers Price Index is troubling because local authorities’ costs especially land and infrastructure costs are increasing more rapidly than other costs like food costs that the Consumers Price Index measures. The Local Government Cost Index would be a much more relevant measure. We all know too that household sizes impact on the services that councils have to provide so it is household numbers rather than population growth that would be a much better measure.  
This bill is bad because it takes the “local” out of “local government” by the way in which it advances National’s agenda of creating supertanker councils—large unitary councils that are difficult for the public to access and to influence. It will see local councils that represent their local communities overwhelmed by the push to create the Auckland model and roll that out throughout New Zealand. As the Napier City Council has said in a letter to many MPs: “It is not reasonable to conclude yet that the Auckland model of local government will serve all in New Zealand well if it is used as a blueprint for every other region.” Outside Auckland that three-tier structure with the regional council the city and district council and community boards works well. If we are going to clean up our waterways we need to look at what is happening in urban waterways—the impact of stormwater and sewage discharges—as well as rural waterways. Where you have that separation of power between the regional council as an environmental regulator and the district or city council providing the services of stormwater management the sewerage system and the like you get more accountability and more transparency. In Christchurch we would still have had treated sewage being discharged into the Avon-Heathcote Estuary if it had not been for the regional council having the decision-making role there because it was the regional council commissioners who said no to that. The city council wanted to continue to discharge it into the estuary.  
Government spokespeople have suggested that the current legislation around amalgamations is not working and that is presumably because small communities with existing councils are voting to retain the status quo and not amalgamate. To me that is evidence that the legislation is working well. Votes against amalgamation show—and I quote the Napier City Council—“that communities have confidence in the localness of their existing council. They value their ability to communicate directly with local representatives and hold them accountable for the decisions they make.” That is the unanimous view of the mayor and all 12 councillors of the Napier City Council. This bill by changing those amalgamation procedures and giving the Local Government Commission a central role is anti-democratic because of the procedures that Mr Grant Robertson mentioned where you have a poll over all electors in the area affected by the amalgamation and not just in each single council area and the requirement that 10 percent of electors must demand that referendum. That is heavily weighted against small communities that want to retain their local voice and their independence through having their own council. Their voice risks being overwhelmed by all of the electors in the affected area and that is anti-democratic.  
In the Green Party we care about the places we live: our neighbourhoods and our towns. We want to make them better living places where people are better connected where communities are stronger and more resilient and where prosperity is shared. We want councils that are the voice for their communities that manage their finances prudently and that invest in sound infrastructure so that our stormwater and sewage discharges are well treated and do not pollute our rivers. We oppose the major thrust of this bill because it reduces the voice of local communities it is anti-democratic and it allows too much scope for Ministers to interfere with local government. It will muddle the accountability of local councils to their electors and make them more responsive to the Minister in Wellington. 
Hon Dr NICK SMITH (National—Nelson) 
: 
 Never have I seen a debate in this House that shows how out of touch the Opposition is with the issues facing New Zealand and how much this John Key Cabinet—and I compliment the work of David Carter on this bill the Local Government Act 2002 Amendment Bill—is on top of the issues that matter. I want to start with the core issue and that is whether New Zealanders are satisfied that the 2002 Local Government Act is working. At the core of this argument are the speeches I have heard from Phil Twyford and the Green Party that say that it is all going hunky-dory and that it is all going awfully well. Well I want to begin by quoting what the Labour Government said when it passed the 2002 Act. It said that the rate of rate increases would not change and that the costs of local government would be well controlled.  
Let us look at what has occurred in the decade since Labour rewrote the local government laws. Of all the 164 factors that are included in the Consumers Price Index which one has gone up the fastest in the last 10 years? Has it been the price of fuel? Has it been the cost of food? Has it been the cost of housing? No it has been the cost of rates. The cost of rates has gone up faster than any other area of cost for householders and what the Labour Party and the Greens have said is that they do not care a toss. They do not care about the cost of rates bills for retired families for working families and for businesses. Over the last decade rates have gone up by more than double the rate of the Consumers Price Index.  
The first challenge I have for any member opposite is to please explain for me why it is that in the period from 1992 to 2002 the decade before Labour made those very significant changes the average rate increase was 3.1 percent—3.1 percent for that decade. In the decade since rates have gone up by more than double that rate. I say that it is absolutely right in these financial times for this Government to review how well that 2002 Act is working. 
Phil Twyford 
: He’s just making it up. 
Hon Dr NICK SMITH 
: The member says we are making it up. Let me give you another example. Why is it that households over the last 3 years in response to the global financial crisis have reduced their spending and reduced their debt? Businesses in New Zealand have responded by containing their costs and reducing their borrowing. Equally so we have seen in the farm sector people being more cautious reducing their spending and reducing their debt. In this Government we have adopted that and we have seen that in the Budget that has been set down.  
Why is it that the only sector whose spending is continuing to grow and whose debt is continuing to grow is the local government sector? And members opposite have got absolutely no idea what to do about it. 
Phil Twyford 
: But it’s nothing to do with the Act. 
Hon Dr NICK SMITH 
: Let Mr Twyford deal with some facts. The level of local government debt in 2002 was $2 billion. Do you know what the level of debt is within the local government sector since the previous Government passed the Local Government Act? It has gone from $2 billion to $8 billion—$8 billion. 
Andrew Williams 
: What’s central government gone from? $8 billion to $52 billion. 
Hon Dr NICK SMITH 
: I challenge Mr Williams who is interjecting. If we look at the long-term plans that have been set down by councils for the next 10 years we see that they are going to take that level of debt up to $20 billion. How many members of this House really believe that it is wise in these current financial times when we are seeing countries in Europe wrecked by debt to take our level of local government debt from $8 billion to $20 billion? What we have heard from Opposition members is that they are OK with that. They are OK with the level of local government debt in this country going from $2 billion to $20 billion. 
Phil Twyford 
: His numbers are shonky. He’s making it up. 
Hon Dr NICK SMITH 
: The member interjects and asks whose numbers. Well I have a simple question for Mr Twyford. Has the level of local government debt gone from $2 billion to $8 billion since Labour passed the Local Government Act? He is the man who is shouting and continuously interjecting suggesting my numbers are wrong. I put a very simple question to him and he cannot answer it.  
Let me come to one of the core debates that has been raised by members opposite and that is the issue of the purpose of local government. The touchy-feelies on the Opposition benches think the role of local government should be to provide for the nation’s social economic cultural and environmental well-being. I will ask an honest question. Every one of the needs of our community in New Zealand can be defined into those four areas. Do we really believe that with 4 percent of GDP people can meet all of those needs? It is a nonsense.  
What we need is a well-focused local government sector with a clear framework from Government about what its job is. Is it for instance the job of the local government sector to provide for welfare? No it is not. It is a core responsibility of central government. How many members opposite think that it is really smart that the New Plymouth District Council owns 20 dairy farms in Tasmania? Does Mr Twyford who has had so much to say when interjecting think that it is smart that the New Plymouth District Council has got millions of dollars invested in dairy farms in Tasmania? He is suddenly silent. The reason is very simple. It is that just as we in central government define that we have roles for our courts for our education for our health and for our welfare it is absolutely sensible for Government to set down and say to our councils: “Your job is to provide good quality local infrastructure. It is your job to provide those good important local services like libraries and like parks.” And thirdly it is important—actually a very important role—for our councils to provide efficient local government services.  
I want to deal with the issue of council mergers because that has caused some commentary from members opposite. My challenge to them is this: there have been 14 attempts under the old legislation to reform councils and every single one of them has failed. I have a simple question for members opposite: was it sensible when we had the Banks Peninsula District Council and Christchurch City Council wanting to merge—one Banks Peninsula District Council voted for and one voted against—that that merger was able to be achieved by the Banks Peninsula District Council effectively voting itself hara-kiri? That was the way that that reform occurred. That is under the existing Act. Do members opposite really believe that that is a sensible way in which to advance local government reform?  
Could I test a further idea around democracy. What the Greens have just argued is that you should not be able to have local government reform unless every single district agrees. Let us apply that to a very important referendum we had recently. Should we have a view that we should not have had MMP unless every electorate had a majority voting for it? There were electorates like for instance Clutha-Southland that voted no. They did not want MMP. So should we have said in 1993 when we reformed from first past the post to MMP that unless every single subcomponent of New Zealand agrees there will be no change? It is our view that in these times we do need to be looking at our local government structures to ensure that they are efficient. The track record is that the current system does not work and that it is too resistant to change. I think we have to have an honest conversation. Auckland would never have reformed itself. And for all the noise that we get from Phil Twyford my simple question to him is this: with the existing system which is in the 2002 Act that you are responsible for would you have got that long-overdue reform in Auckland if you had waited for the provisions of the existing Act to work? Every member of this House knows in their heart of hearts that those Auckland councils would never have been able to move forward and move Auckland forward in the way they have.  
I want to make one last point and that is about the intervention powers. It was somewhat ironic hearing from Eugenie Sage about the Minister of Local Government’s power to make decisions. Is it not interesting how Environment Canterbury has performed so well over the last 4 years? We have now got a plan to clean up Lake Ellesmere. We have got a higher level of compliance in resource consents. In fact the biggest level of improvement in resource consent compliance has been in Canterbury. But the point I want to make is this: at the moment the only power the Minister of Local Government has is to fire a council. It is absolutely sensible that this bill gives the Minister lower-order powers— 
The ASSISTANT SPEAKER (Lindsay Tisch) 
: I am sorry to interrupt the member but his time has expired. 
ANDREW WILLIAMS (NZ First) 
: 
 It is a shame—I seem to always get the call with 2 minutes to go and the line of thought can be a little bit interrupted when you have only 2 minutes to wind up. It is very interesting to hear the comments of the National members in relation to this bill the Local Government Act 2002 Amendment Bill particularly as most people in the National Government have had no experience in local government at all. They speak as if they have got huge knowledge. Ian McKelvie over there a former Mayor of Rangitikei certainly does but most of the National Party people have no knowledge. It is interesting therefore that they expound these utterances but they really do not know what they are talking about.  
Coming from 9 years in local government and as probably the only person in this Parliament elected as a community board member elected as a councillor and elected as a mayor— 
Maggie Barry 
: Not at the last elections. 
ANDREW WILLIAMS 
: —I do have a little bit of knowledge rather than those who concentrate on gardening activities. There are those in this room who would not know that there was a certain National Party backbencher—John Key—who had a member’s bill back in 2005-06. It was not drawn from the hat in that Parliament but he was trying as a backbench MP of the National Party in Opposition to create a super-city in Auckland. Is that not interesting? Most New Zealanders do not know that the person who was pulling the strings to create the super-city in the first place was a backbench MP by the name of John Key. Is that not interesting?  
I now have only half a minute to go but I will come back after the tea break and I will continue this discussion on the proper history of local government and how we got to this stage and the fact that local government in New Zealand is actually doing very very well. For instance the Shand report back in 2007-08 said that local government had $100 billion in assets and only $2 billion in debt and it was the recommendation of the Shand report into local government that they should leverage their balance sheets— 
The ASSISTANT SPEAKER (Lindsay Tisch) 
: I am sorry to interrupt the honourable member. It is time for me to leave the Chair. This debate is interrupted. 
Sitting suspended from 6 p.m. to 7.30 p.m. 
ANDREW WILLIAMS 
: When we left off just before the dinner break I was giving details of how the National Government cannot be trusted when it comes to local government. From 9 years of experience in local government I certainly came to learn how the National Party both in Opposition and subsequently in Government could simply not be trusted.  
I mentioned before the dinner break that John Key as a backbench MP back in 2005-2006 put forward a member’s bill which was not pulled from the ballot to create a super-city in Auckland. When National became the Government it handed that over to Rodney Hide and gave him the dirty work but basically John Key’s paws were all over it and it was his idea in the first place to create the super-city to back National’s rich mates in Auckland to corporatise Auckland and to create all the council-controlled organisations.  
We are now seeing water bills in Auckland being posted out on a monthly basis under Watercare Services we are now seeing weeds growing all over Auckland where they were not growing before and we are now seeing the destruction of many of the services that were previously available in parts of Auckland. Those services are now all being centred on the centre of Auckland where basically local government in Auckland in many respects particularly in the case of communities is going backwards.  
We must recall that National in those days when it was still in Opposition promised prior to the 2008 election that it would consult the people of Auckland on the creation of the one council in Auckland. It said it would consult on the outcomes of the royal commission of inquiry into Auckland. Well 6 months after the election such agreement to consult people of Auckland disappeared out the window. The commission reported on 31 March 2008 and subsequently within 10 days Rodney Hide threw that 800-page $5 million report out the window and came up with his 34-page result for Auckland.  
That was an example of how National works with local government and this latest local government reform is basically a continuation of that where it basically gives lip-service to local government in this country. We must remember that Australia has three levels of government. It has a Federal Government state government and then it has local government whereas here in New Zealand we have only two levels of government—that is our central government and our local government—yet this central government seems to want to get its paws all over our local level of democracy and basically have the Minister determining much of what will happen within the local councils and within the local authorities.  
We have to remember what local government came out of. It came from hundreds and hundreds of years of history—the histories of town councils town shires and representatives of a town or a village or whatever being chosen by the people of their town village or district to represent the interests of the greater mass of people in that area and to do the work on behalf of that community. That is what local government is all about and it is not for central government which is supposed to work on high-level policy high-level planning and high-level direction in respect of central government issues to start delving into how a local council should operate.  
I mentioned before dinner that there was the Shand report in 2007 a very extensive report into the ratings structure in New Zealand and how local councils should be funded. This report which was delivered by the commissioner mentioned that local government in New Zealand was some of the most efficient local government anywhere in the world and that New Zealand local government was the envy of local government around the world.  
The report also said that New Zealand local government was sitting on about $100 billion of assets but only had about $2 billion of debts. If New Zealand was to increase its infrastructure grow its infrastructure and improve its infrastructure those balance sheets of the councils should be leveraged to a higher degree and they should take on longer-term debt to pay for the infrastructure within New Zealand which central government could not afford to fund.  
Therefore over the last 7 or 8 years that has been an ongoing case and councils have extended their debt. For instance in the North Shore we built a $120 million sewerage outfall pipeline to go 3.9 kilometres out into the Hauraki Gulf. That was costing $120 million a lot of money for a population of 230000 people but because we amortised it over 50 years and we took a long-term debt on it and we made intergenerational debt as part of that whole loan we could afford to do that and basically provide the sewerage services for the community not just for the 50-year life of the loan but for the next 100 years that the asset would be there.  
In that respect when councils in New Zealand are turning over in the order of $7.5 billion a year an $8 billion debt across our councils is not a huge amount of money in the greater scheme of things. This National Government in 3 short years took the national debt—I am not talking about the National Party’s debt; I am talking about the national debt of this country—from $8 billion to over $50 billion today. That is an extraordinary loading of debt in 3 short years and it is projected that over the next 3 years it will go to $72 billion. So this bill is so hypocritical of National. It is the pot calling the kettle black. Then we had the Hon Nick Smith say that local councils went from $2 billion to $8 billion of debt when they have $100 billion in assets while central government—this National Government—has gone from $8 billion of debt and will end up at $72 billion of debt.  
Another example of where National kicked local government in the teeth was a situation where Auckland was trying to fend for itself and trying to provide for itself. It needed the infrastructure and was prepared to put in a regional fuel tax to start at 2c a litre and rise to 9c a litre over a period of 4 or 5 years. It was negotiated over a period of 3 years with central government and it was going to help fund much of Auckland’s infrastructure and pay for the likes of rail ferries public transport buses and all sorts of thing out of a fairly charged petrol tax across the region.  
What did the National Government do? It got into power and within months it kicked the proposed regional fuel tax in Auckland for touch and cancelled it. It would have by now today been producing more than $1 billion a year for the Auckland region to pay for public transport and to pay for infrastructure in Auckland but what did National do? It took it away but typically did not replace it with anything. It has ridden on the strings of the former Government which was in partnership with the New Zealand First Party at the time which was already rolling out projects such at the western ring route the Northern Busway and the motorway extension to the west.  
Quite frankly in closing I just say that I am very tired of people from the National Party who know nothing about local government who have spent no time in local government and who spout on about what they know about local government. Quite frankly this latest reform of the Local Government Act 2002 is basically taking the councils right back to where they were maybe 20 or 30 years ago where they simply had a town clerk who fixed some potholes did some footpaths and maybe fixed up the roads and patched up the local hall. Well the days of that have gone and the days of local communities expecting much more from their local council are here. It is a very sorry day in this country that this National Government is going back to those days. 
NIKKI KAYE (National—Auckland Central) 
: 
 I am very pleased to speak on the Local Government Act 2002 Amendment Bill in its first reading. Can I start by just saying look I think we need to reflect on why we are here. When we came into power what we saw was excessive debt within local government. Over a period of time we saw debt go from $2 billion to $8 billion. Let us just get that straight. Council debt quadrupled in New Zealand from 2002 from $2 billion to $8 billion. We also had a very difficult situation in Auckland where we had fractured local government and we had under-investment in infrastructure over a large period of time. We have had fractured local government and significant debt over a long period of time and what we acknowledged is that we needed change. So what you have seen from this National Government is significant reform in both the Resource Management Act and local government that culminated in the Auckland local government reform. I am very pleased to say that we now have one council one mayor and one plan for Auckland.  
But what this bill is about is saying there are many New Zealanders struggling at the moment. They cannot afford excessive rates rises. They need clarity around what local government is responsible for. And what we acknowledge is that when the previous local government legislation came in it gave incredibly wide paths around the purpose of local government. That is where we have seen some of the debt blowout. What we are standing up and saying is that this is part of a package of reforms that we have had that is about reducing costs to the household reducing costs to businesses reducing compliance costs and ensuring that people get speedy processes in terms of their interaction with their local authorities. We have seen that through the Resource Management Act and we are now seeing this as a package of local government reform.  
Members will hear from the left that this is about taking away democracy. They will hear that this is about ensuring that some local body members do not have as much power. What I would say to members is that we have been very clear that we do believe in local government but we believe in local government that is not duplicating the functions of central government. That is not good for the ratepayer that is not good for businesses and that is not good for New Zealand. We also believe in local government that ensures that businesses are able to get on and do what they need to and not have excessive costs and time delays.  
I just want to address a couple of parts of this bill that I am very confident many New Zealanders will be very pleased to see. The first thing is transparency and financial accountability in local government. Most New Zealanders I have talked to actually think that is a very reasonable pragmatic thing to expect of local government. We do it at central government level. We have many different processes whereby New Zealanders can look and see the accountability and they can see the transparency around where funds are spent. And this bill is saying that we are going to have stronger governance improved efficiency and more responsible financial management.  
The second thing that this bill is very very focused on is those councils that struggle. Let me say that there are many councillors and local body members who do an outstanding job in New Zealand but sometimes they get into trouble. This is what this bill says: we are actually going to put a process in place that strengthens those local authority governance provisions to enable central government to help those councils that may be struggling.  
But it also does something that I think is very important and the genesis of this was the Auckland local governance reform provisions whereby we acknowledged that in order to empower elected representatives we actually might need to give them more power over employment and remuneration authority. It is working reasonably well in Auckland and we acknowledge that this is actually about empowering local members to be able to have greater control over their communities.  
These are very reasonable and sensible reforms that most New Zealanders would understand. It is about ensuring we have greater financial accountability and transparency around funds and where they are spent but also empowering those local members to be able to get on and do their agenda. I know there are members in this House—because I know them pretty well—who have been local representatives who have been frustrated when local representatives have not had the ability with council officers to control the agenda. And what this bill does is it gives greater power in that area.  
Finally I just want to mention that there is a person in the building tonight Ambassador Huebner—and I am going to relate this to local government to ensure that it is relevant for my speech—who gave a wonderful quote last night from Oprah Winfrey about New Zealanders and Americans. He said lots of people want to ride with you in the limo but the person you want next to you is the person who will catch the bus with you when the limo breaks down. I just want to acknowledge that—and I am going to link this to the local government reforms—the ambassador is in the House this evening. This bill is about delivering long-term infrastructure for communities and what we are saying is that we are striking a balance in this bill to ensure that communities have the power over a significant period of time to pay for that infrastructure. What we have seen in a city like Auckland is significant under-investment over a long period of time and the reality is that that has been in successive local authorities and it is because we have not had a structure in place. I just want to acknowledge that what this legislation is about is ensuring that actually that is done in a reasonable and pragmatical way that is affordable for the many households that are struggling at the moment and cannot afford significant rates.  
This Government is about greater financial transparency in local government this Government is about ensuring that local bodies have their power and are empowered by the council employees that they have with them and it is also thirdly about ensuring that local infrastructure is focused on what we need and is not duplicating central government. So I am very proud to support this legislation to the House. I support this legislation. Thank you. 
Dr MEGAN WOODS (Labour—Wigram) 
: 
 I am very happy to take a call on this bill the Local Government Act 2002 Amendment Bill and to continue the case of why it is that Labour is opposing this legislation. We have got very clear reasons why we are opposing this bill that has come before the House. We are opposing it because it is a politicised attack on local government and it will undermine democratic processes and put a fiscal squeeze on councils.  
We see this as yet another attack on democracy. Not content with stealing votes in Canterbury and its machinations in Auckland this is a Government that is going after more democratic rights in this country—the raiders continue. This bill is a solution looking for a problem. It is a reform to a manufactured crisis based on manufactured statistics. We have heard members in this House tonight—we heard Nick Smith before the dinner break and we have just heard Nikki Kaye—continuing this myth-making and spinning the numbers even though their own officials do not agree with them. We have had the Department of Internal Affairs tell the National Government that this is not right. The regulatory impact statement for this bill raises the issues of the risks whether the proposals will work the significant sector reaction that is likely and the assumptions that have not been partially tested.  
The numbers that this bill is modelled on are shonky. We heard the previous member from the Government side talking about the need for greater transparency and budgeting in local government. Well I put it to members here that actually the levels of transparency that we have around budgeting in local government far outstrip the levels of transparency we have at central government. The debt-equity ratios that territorial local authorities need to work to are transparently laid out not only in long-term council community plans but also in the annual planning process. There is this level of transparency so let us not dress up what this legislation is really about. What this legislation is really about is yet another raid on New Zealanders’ democratic rights and their rights to be heard. What this legislation is also about is yet another way for this Government to try to sell assets in this country and this is the focus of the legislation that I am going to talk about tonight.  
It has not been dressed up at all by Government Ministers or indeed the Prime Minister that this is one of the primary objectives of the legislation. Provisions in this bill will enable the Government to really put the fiscal squeeze on councils to sell their assets. They are being advised by the Prime Minister and the Minister of Local Government to consider selling those assets. New Zealanders are telling this Government over and over again that they are opposed to asset sales at central government level and they are also opposed to these sales at local government level. This is not something the community wants.  
In January this year the Minister for Canterbury Earthquake Recovery Gerry Brownlee asked for a list of ratepayer-owned strategic assets in Christchurch and said there would never ever be any pressure put on Christchurch City to sell those assets. Well you do not ask for a list of something just to keep it in your back pocket and lo and behold what has happened? There is continued pressure going on for the sale of assets in Christchurch. We are seeing a mayor and a council having to do a push-back to keep hold of those assets.  
Let me tell you John Key has said that it is time for us to have a grown-up conversation about asset sales in Christchurch and Christchurch City’s holding on to that. Well let us start that grown-up conversation right here and now about Christchurch’s assets. Let me tell you a story a story of a city that withstood the ideological push over a number of years and retained its assets. It is a city that was branded—which the Business Roundtable at the time thought was going to be a put-down—as the “People’s Republic of Christchurch”. Well I can tell members opposite before you start trying to flog off our assets in Christchurch this should actually be a bit of a warning bell. That was a tag we wore with pride. We did not sell our assets; in fact we did everything we could to keep them. What does this city which managed to keep intact its asset base and this story have to teach the nation? This is a city that has an asset base of around $2.3 billion plus additionally its city housing stock of which it is the second-largest landlord in New Zealand. We have assets like our electricity supply company Orion. We have our airport our port our City Care and Red Bus—the list goes on.  
These assets these cumulative assets which have been built up by generations of Christchurch people what has the impact of retaining these assets been? The impact has been that Christchurch has rates that are on average 20 percent lower than the rest of the country. We are being told by the Government that one of the purposes of this bill is that it wants to reduce the burden of rates on residents around New Zealand. Well here is a salient lesson through the story of my city the story of Christchurch: do not flog off your assets and you get a dividend stream. That dividend stream to Christchurch is what has kept our rates low. How have we kept our rates low? Has it been by slashing and burning and not providing services to its residents? No. That has not been the way we have kept rates low; it is that dividend stream for these assets that we have jealously held on to the dividend stream of around $40 million per annum that is returned to the city. That equates to around $2 per week for the average household that they do not have to pay in rates. This is a dividend stream coming from Christchurch City Holdings Ltd of around $100 million per annum. This is even a conservative take-back to the city that allows for the building of the assets. It just beggars belief that we might want to sell these off.  
How much could these be flogged off for? Well we do not know because our council is being pressured to ready these assets for sale according to information that I have had released under the Local Government Official Information and Meetings Act. I have a list of all the assets and what they are worth and the council has been asked to put together a book value for them. That has all been blanked out so we do not actually know what the Government thinks we could have but we do know that the Government is asking the council to repeat the model its mixed-ownership model—which is a fancy way of saying “selling off the assets”—that is happening at central government level at local government level as well.  
What is the net result for Christchurch going to be if these assets are sold off as this legislation is going to put the push on to do? It will be higher rates in the long run because half—half—of that $40 million a year of dividend stream will now have to be received through the rates system. Even if Christchurch City has to endure the 7.5 percent rates increase that the council is currently proposing in its annual plan rates in Christchurch will still be 16 percent lower than the rest of the country simply because we had the foresight as a city to hold on to our assets. What we have now is a Government that says that it wants to force councils to sell their assets in an effort to keep rates low. Well the story of Christchurch shows how short-sighted that is. It shows the fact that financially in the long run all it is going to do is put rates up. It is exactly the same argument against selling State assets at central government level. This is an ideological commitment from members opposite to put on the block assets that have been built up by generations of New Zealanders that are not those members’ to sell and which they have no mandate to sell.  
This piece of legislation does nothing to enhance democratic rights in New Zealand. It does nothing to better local government. All it will do is asset-strip the people of New Zealand in yet another way. 
MAGGIE BARRY (National—North Shore) 
: 
 I rise happily to talk to the Local Government Act 2002 Amendment Bill. I well remember when it came in actually. It was the dark days of Labour. Political correctness was at its absolute height. Labour was redefining everything: light bulbs shower with a friend—it got too nonsensical for words. And this is a piece of legislation that absolutely is long overdue. Let us have a little look at it shall we? These so-called four well-beings—well what exactly does that mean? It means that local authorities are suddenly getting involved in National Certificate of Educational Achievement (NCEA) pass rates. They have targets for this. Hello? Get back to your core business. This is what this piece of legislation is looking to do and it will do because we have the courage to address these issues unlike Labour which ushered in a lot of stuff and nonsense that is too expensive and utterly unaffordable. Let us have a little look at it shall we?  
We heard Nick Smith before who knows a great deal about this looking at the way in which the spending has grown. It has quadrupled since 2002 from $2 billion to $8 billion. What have we got? A lot of stuff and nonsense and politically correct rubbish which has to go—and it needs to go. This piece of legislation will tidy it up and we have the courage to do it. Frankly local government can do better and it must do better. This bill aims to ensure that it does. We will make sure that local government is consistently measured across the country so that we can see the poor performers and we can get a heads-up if some council is running amok with unaffordable ludicrous sewerage schemes.  
The ratepayers need protecting. They need protecting from people on the opposing side of the House actually because those members are the sorts of people who would borrow us into the sort of indebtedness that Greece would envy. It is a ridiculous situation but we have to look at it really strongly. These four well-beings were always ludicrous and now when we look at what we can do we need to provide affordable and reliable services. We need to focus in on the basics. It is all very well to talk about NCEA passes when you have potholes on the road you have stuff and nonsense happening all through the electorate.  
I live on the North Shore. We have in my electorate people on fixed incomes who are really hurting because of the way the rates are being hiked by a big-spending mayor who lives on the other side of the harbour. He has big plans for rail. It will not solve any of the issues that plague us on the North Shore with transport. Nor is he going to necessarily put the kind of money into the infrastructure that the people on the North Shore are used to. These are people who deserve to be able to stay in their own homes and not face the kinds of rate hikes that profligate spending has brought upon them. It is wrong and it needs to be stopped and this is the piece of legislation that is actually going to do something about it.  
Legislation will help councils and give them more tools to keep the debt down and the rates affordable. If they do not want to they will be brought into line. Accountability greater efficiency effective and affordable—these are alien notions to the people on the other side of the House. They could not run the Government that way they cannot run their party that way and they let local government run amok in this way. Councils need to be pulled back into line and fortunately we are here to be able to do it. Stronger council governance labelled as a threat to democracy? That really is drawing a long bow. How typical that members opposite would bray and bleat about such measures. Councils need to be kept under control. We need to keep the debt down and the rates as I say are the strongest thing.  
Council governance—let us look at it. Central government will be able to assist struggling councils before the situation becomes critical. Elected council representatives will actually get stronger powers. If you listen to some of the chattering classes you would think that they are actually having their rights reduced. In fact mayors will be involved in the development of plans; they will be able to do more. They will be able to appoint a deputy mayor and committee chairpersons. They will have a stronger leadership role.  
Leadership is of course a very touchy issue across the House. There are a lot of Davids clamouring for it. There is a Grant and no doubt a couple of Jacindas as well. They are all vying for the absolute void of leadership that exists across the House. But on the other hand with the local government reforms that we are bringing in mayors will be able to be held accountable and they will be able to make more decisions about how the council is run. Again it is about accountability which is a word that Opposition members know very little about. They probably would not even know how to spell it although if they get their NCEA pass rates up with local government they might be getting a bit better.  
We plan it in a different way. Government does the governing and local authorities deliver the services. It is a pretty clear distinction and I think it is probably an important one and that is why this piece of legislation is needed. So we will do as we usually do and ignore the chattering classes and their cheap political points.  
I have been interested to see actually that they are trying to knock gardeners. Gardeners are people who along with the farmers are good people in New Zealand. Suddenly though on the other side of the House we are being told that gardeners are no good that they do not have a role and a place. How ludicrous! How sad is it for Opposition members that they are attacking gardeners. They are attacking people in their own backyards who are doing their bit to save the planet. The Opposition really has lost its way and lost its direction. This is of course not news to us.  
But I return again to the statement which is that the Local Government Act 2002 Amendment Bill is an excellent piece of legislation. I support it unreservedly as does my North Shore electorate and as we do here on the sensible side of the House. 
Mr DEPUTY SPEAKER 
: Chris Hipkins; this is a split call. 
Chris Hipkins 
: It is indeed Mr Speaker. 
Mr DEPUTY SPEAKER 
: Five minutes. 
CHRIS HIPKINS (Labour—Rimutaka) 
: 
 If we needed yet another example of the arrogance that has taken hold of this Government in the last few weeks we just got it there from “Queen Margaret” talking about the chattering classes. Anybody who did not agree with the current Government is part of the chattering classes—the chattering classes! Well I have to say that the people in Upper Hutt are interested in this piece of legislation because this legislation means that Nick Smith and Fran Wilde who have been plotting and scheming to cook up an amalgamation in the Wellington region can do so and take away the rights of Wellingtonians to have a say on it by way of referendum. We know that the plotting and scheming to do away with the democratically elected local councils in the Wellington region has been going on for some time in this Government. 
Moana Mackey 
: She just said: “What’s that got to do with the bill?”. 
CHRIS HIPKINS 
: What’s that got to do with the bill? Maggie Barry or “Queen Margaret” wants to know what that has got to do with the bill. This bill basically allows the Government to do away with the local authorities in the Wellington region without the people of Wellington having a chance to have a say on it. Actually if someone passes me a copy of the bill I might read it to her slowly so that she can actually understand what is in the legislation. I cannot believe that she managed to speak for a whole 5 minutes on it. Someone might have thought she might have read it. I think that is probably the longest speech she has given in the House but clearly she has not actually read the legislation. The Local Government Act 2002 Amendment Bill removes the ability of the people from Upper Hutt to have a say on whether they want to be amalgamated with Lower Hutt or with Wellington city or the Kapiti Coast. At the moment they have an ability to have a say on that but it will be taken away by this arrogant out-of-touch National Government. 
What did the Government do to build the case for doing this? Well first of all it followed the Nick Smith playbook: manufacture a crisis—come out with a whole lot of bogus statistics and make up a crisis. When was the last time he did that? Oh with ACC! How did that turn out for him? How did that turn out for Nick Smith in the end when he manufactured a crisis in ACC? It did not work out quite so well for him. 
It all came unravelled when we found out that the statistics that he was using were totally bogus. His own officials came out and said that his statistics had been bogus and they replaced them on the website with a statement. The statistics were up there on the website but the Department of Internal Affairs replaced them with a statement that said that “there are issues with the data both in terms of its accuracy and in terms of the picture that was given for some councils.” The Department of Internal Affairs officials basically said that Nick Smith was not telling the truth. Their own Minister was not telling the truth about the true picture of local government. It is an indictment on the Government that Nick Smith’s own officials did not believe him. His own officials actually went so far as to put a statement on a website that said he was wrong and that he was not telling the truth. 
Of course there is a bit more to this as well because this Government rushed this legislation in. Did it talk to the people who were going to be affected by it? No of course it did not. The chair of Local Government New Zealand said that a number of its members had expressed concern at the lack of any consultation on the proposed changes before they were signed off by the Cabinet. Oh now that is a bit familiar. Where have we heard that in the last few weeks? I think just about every teacher principal and school board of trustees in the country shared a similar concern for another set of changes the Government was pushing through.  
This is not a Government that does things with people; this is a Government that does things to people. It does not actually care what the chattering classes—as Maggie Barry calls them—think. It knows better—National knows best. That is the mantra of John Key’s Government—National knows best. National will do whatever it likes. It will forget about referendums or anything where people might actually have a say. National will do just whatever it feels like. And this bill is yet another example of that in action. This bill has been introduced without the Government consulting properly with the people who are going to be affected by it and without consulting with the people who might know something about local government—because this Government certainly does not seem to. 
This is another quote from the Department of Internal Affairs the Government’s own officials and this is quite an indictment really. The department is worried that there is risk as to whether “all the proposals will work”. This is the Government officials saying they do not know whether the proposals in this bill are actually going to work and then they further go on to argue that the assumptions that the legislation is based on “are not or only partially tested.” It is a bit like the crazy idea to increase class sizes. 
DENISE ROCHE (Green) 
: 
 I rise to take the Green Party call to oppose the Local Government Act 2002 Amendment Bill. I was going to list everything I could think of that was wrong with it but actually I do not have time. But I will go into some of the problems that we see with it. This bill seeks to emasculate local government. Its overall intention is to reduce the ability of councils to respond to their communities. It seeks to wrest away the power they currently hold and give it to someone else. It seeks to force amalgamations of local authorities enhance the powers of the Local Government Commission and remove the democratic right of the people most affected by local government to have a say on it.  
I can give you firsthand experience of what this feels like. I am a survivor of the forced amalgamation in Auckland and actually— 
Paul Goldsmith 
: Me too. 
DENISE ROCHE 
: There are several others in the room. I acknowledge former city councillor Paul Goldsmith. I acknowledge former North Shore Mayor Andrew Williams. I acknowledge Sam Lotu-Iiga and I also acknowledge the former mayor John Banks.  
My community Waiheke Island was absolutely livid about the removal of our right to choose whether we wanted to be part of the super-city amalgamation. I do not care what the Auckland Central MP Nikki Kaye said about empowering. That is not what happened. We were disempowered in Auckland. Our rights were taken away from us and it was her Government that did it.  
We know from an experience like Waiheke’s that local government or any type of democracy really works best when the people know their local representatives when they can eyeball them in the supermarket and chew their ear off and make them accountable. That is how they get to be engaged in their communities. When people do that they are actively participating in local decision-making and that is when we get real democracy. We need that to happen more not less.  
Nearly a third of all New Zealand voters did not bother to vote at the last general election. Contrast that with the fact that about a quarter of the submissions on the super-city amalgamation legislation came from 0.8 percent of the 1.4 million people in Auckland—they came from the Hauraki Gulf that 0.8 percent. They are active and engaged. Their concern and the concern we share about this bill is that the “local” is being removed from local government.  
We are concerned that this bill is going to steal the heart out of local government. It wants to remove from the Act the four well-beings. It wants to remove the requirement for councils to provide for the “social economic environmental and cultural well-being” of communities. Those words were a huge breakthrough in 2002. They underpinned a whole bunch of things that councils with heart do and they do it in a very cost-effective manner. They recognise that local government has a role to create and support safe vibrant and healthy communities. 
 To use the words of David Hay Mr Goldsmith’s good friend and the leader of the Citizens and Ratepayers cabal that was in the former Auckland City Council—and he was the deputy mayor then too—he says that he has “always maintained that councils should focus on rates roads and rubbish”. That is what this bill wants to do. It wants to take everything else away and just focus on that. He was really outraged about libraries because he did not see that councils had a role in educating—like Maggie Barry I guess—or inspiring the people who live in our communities.  
I feel for our local councillors. I am heartened by Local Government New Zealand because its research is accurate research. It can show that over the last 3 years the rates increase has been steady at 2.8 percent of household income; that is all that is being spent on rates. We are prudent financial governors in the local sector and for this Government to disembowel democracy in local government is beyond the pale. It is another move that should be resisted.  
ANDREW WILLIAMS (NZ First) 
: 
 I seek leave to table an extract from an address by the Rt Hon John Key Prime Minister to the 2011 Local Government New Zealand conference when he stated: “The Government is keen”— 
Mr DEPUTY SPEAKER 
: You do not need to go into it. You have told us where it is from. Leave is sought for that purpose. Is there anyone opposed to that course of action? There is opposition. It will not be tabled.  
PAUL GOLDSMITH (National) 
: 
 I rise to support this bill the Local Government Act 2002 Amendment Bill. It is interesting hearing the other side talk of manufacturing a crisis. I think Mr Parker will struggle in Epsom next time if he turns up and says that there is no crisis in local government. People are a little concerned that their rates are going to be going up 30 percent over the next 3 years thanks to the efforts of the left-wing mayor Len Brown and his council.  
This is a timely bill. Local government is important. We have heard the figures: 4 percent of the economy spending about $7.5 billion annually controlling $100 billion— 
Hon David Parker 
: I seek leave to table the audit accounts for Auckland City Council showing that John Banks when last— 
Mr DEPUTY SPEAKER 
: Order! We are not going to interrupt a speech for tabling. Any tabling is done— 
Hon David Parker 
: I raise a point of order Mr Speaker. I am within my rights under Standing Orders to take a point of order seeking to table a document. What Standing Order are you relying upon to tell me that I am out of order?  
Mr DEPUTY SPEAKER 
: I am telling the member that it is the convention of the House that we do not interrupt speeches to table documents and I will uphold that convention.  
Hon David Parker 
: Speaking to the point of order— 
Mr DEPUTY SPEAKER 
: No I have already ruled on it. The member will resume his seat.  
Hon David Parker 
: I raise a point of order Mr Speaker.  
Mr DEPUTY SPEAKER 
: Is this a separate point of order?  
Hon David Parker 
: I am very rare in my intervention in the course of a speech to table a document but I do have the ability to do it under the Standing Orders. I do not abuse that privilege and I am within the Standing Orders. I suggest— 
Mr DEPUTY SPEAKER 
: Order! The member will resume his seat. I have ruled quite clearly that if the member wants to do that he can do that after the member has concluded his speech. He will not interrupt a member and that is the convention of this House.  
Andrew Williams 
: I raise a point of order Mr Speaker. Just in relation to this— 
Mr DEPUTY SPEAKER 
: No look I have ruled on this matter. The member will resume his seat.  
Andrew Williams 
: I raise a point of order Mr Speaker.  
Mr DEPUTY SPEAKER 
: I will hear the member but if he is pressuring me he may well leave the Chamber.  
Andrew Williams 
: No I am not pressuring you. What I am saying is that the honourable member on the other side of the House made comments in reference to the current Auckland Council that were misleading— 
Mr DEPUTY SPEAKER 
: Order! That is not a point of order. It is a debating point. You cannot debate an issue through a point of order.  
PAUL GOLDSMITH 
: There was nothing misleading about talking about 30 percent increases in rates and I am continuing in my speech. We need a local government sector that is productive and efficient and the effects are much broader than the 4 percent of the economy. It impacts on the costs of housing the effectiveness of transport and the ease of doing business in a city or a region.  
Local government can absolutely be a force of good. My neighbourhood is well served by good footpaths roads and libraries and the Auckland Art Gallery makes a wonderful contribution to this city—yes but local government like everything else has to fit with the times. Like central government we need to deliver excellent services to New Zealanders within tight financial constraints. This Government has just now brought through its second zero Budget. Households all around this country are looking for ways to look for savings asking questions like “Do we absolutely need to be doing this?” and sorting out their finances.  
But the message has not filtered through to local government yet. In fact it has been on steroids since 2002 when the council roles were expanded to promoting these four well-beings that we hear so much about: social economic environmental and cultural. Since 2002 we have seen council debt quadruple from $2 billion to $8 billion. At the same time council rates have gone up on average 7 percent per year far outstripping inflation. In Auckland we have seen huge growth in this particular new council’s budget; the new rates are expected to increase by nearly 15 percent over the next 3 years.  
I mean if ever members of the House wanted a case in point on this when this document arrived I thought it was a fancy art book from Germany but indeed it turned out to be the Auckland Plan—a wonderful very expensive-looking document. Then you look through at what this council is going to be doing in this comprehensive plan. Look at some of the sorts of things we are going to be doing: we are going to be ensuring that by 2017 all preschool children receive all Well Child checks including a B4 School check and are up to date with child immunisation. That is crucial for local government! We are going to reduce the rate of total criminal offences per 10000 and there are going to be no gaps between the life expectancy of European Maori Pacific and Asian ethnicities by 2014. Thank goodness my rates are going to focus on that! Then if we look over here at strategic direction No. 9 we are going to “Reduce the proportion of people living in households requiring at least one extra bedroom from 15.7% in 2006 to 10% by 2040.” Well that is a marvellous piece of work from the council. Finally if we look here we find that health services and facilities of all care types will be aligned across all Auckland and will ensure that all Auckland children can access primary schools within 30 minutes. There are all sorts of things that this council is focused on that in this Government’s estimation are far beyond what we should be focusing on in local government and they are things that are dealt with by this enormous collection of taxes that central government has. That is where we need to be focusing on what central government does and let local government focus on the essentials of what local government does.  
Through this bill the councils’ core values and roles are to be focused on local infrastructure regulatory functions and public services. If we look at the legislation and the new purpose local government is required “to meet the current and future needs of communities for good-quality local infrastructure local public services and performance of regulatory functions in a way that is most cost-effective for households and businesses.” That I believe will be very important in sending a message about the kind of attitude to how local governments go about their business which is about being cost-effective.  
Finally I just want to make the point before we go on at great length that this is the first part in a longer programme of reform. The second part will be looking at the Local Government Efficiency Taskforce work which is just getting under way at the moment and it will be developing an interface. We will also be looking at the use of development contributions which I think have got somewhat out of control in the last decade as well.  
There is a lot of work to be done in local government. It is a very important part of the government sector and of the New Zealand economy. It can be more efficient it needs to be more productive and I think that this is evidence of how the sector has lost its way a little bit in my perception. This bill will go some way to rectifying that and getting it into a more streamlined sector of the economy. I support this bill. Thank you.  
Hon DAVID PARKER (Labour) 
: 
 I seek leave to table audit accounts for Auckland City Council for the 3 years to 2010 during which period Auckland City Council debt tripled under the governance of Mayor Banks.  
Mr DEPUTY SPEAKER 
: Leave is sought to table those documents. Is there anyone opposed to that course of action? There is.  
A party vote was called for on the question  
That the Local Government Act 2002 Amendment Bill be now read a first time. 
Ayes 61 
New Zealand National 59; ACT New Zealand 1; United Future 1. 
Noes 59 
New Zealand Labour 34; Green Party 14; New Zealand First 8; Maori Party 2; Mana 1. 
Bill read a first time. 
Bill referred to the Local Government and Environment Committee. 
Hon PAULA BENNETT (Minister for Social Development) 
on behalf of the Minister of Local Government: I move  
That the Local Government and Environment Committee report to the House on or before 15 October 2012 
.  
Motion agreed to. 
Social Security (Youth Support and Work Focus) Amendment Bill 
Second Reading 
Hon PAULA BENNETT (Minister for Social Development) 
: 
 I move  
That the Social Security (Youth Support and Work Focus) Amendment Bill be now read a second time 
. The welfare system has not been working as it should and as it could. It has allowed too many to become trapped in an intergenerational cycle of dependence. There are more than 317000 people on welfare right now. Add to that the 220000 children living in welfare-dependent homes and that adds up to more than half a million New Zealanders reliant on welfare in any given week. 
This Government is transforming the welfare system into one that is modern active and responsible because currently it is passive out of date and quite frankly it is failing too many. We started this work with Future Focus changes in 2012 and we continue with the major reforms now before the House. We have had some successes in that time and in the last month alone we saw the unemployment benefit numbers drop to 49219 after the peak in January 2010 when 68000 were on this benefit due to the economic downturn. We never hit the projected highs of 95000 on the unemployment benefit as forecasted and as the economy improves and other measures set in we are seeing a reduction on unemployment benefits. 
At this point the Greens Labour and New Zealand First would say that their point is made: leave those on welfare alone and it will take care of itself. But factually that is not true. Although the unemployment benefit figures dropped significantly from 2003 to 2007 the sickness and invalids benefits increased by nearly 20000 people. We have managed to stabilise that trend in the last 2 years and in fact the invalids benefit numbers have decreased slightly. Because of the policy changes we made through Future Focus in 2010 we now have Work and Income working better than it ever has but more needs to be done. We could leave it as it is sure and yes the unemployment benefit numbers would decrease significantly as the economy bounces back but that would mean ignoring the other 270000 people on welfare. That would mean wiping them off as not worthy of support into work and independence from the State. I will not do that. 
I understand completely how frightening change can be. I get how debilitated and worthless some feel on welfare and the left would say that is a strong enough reason to leave well enough alone to feel sympathy for those on welfare. They would pat them on the head and feel sorry for them. How condescending how patronising and how meaningless. I will not do that. Although I understand how frightening change can be although I acknowledge that upskilling gaining confidence and getting into paid employment is not easy as Minister for Social Development I will continue to push cajole incentivise obligate and at the end of the day put all my belief in those people who are on welfare. I will take some of the anger that comes from those most unsure and often most frightened because to ignore the benefits of work to look only at what they can do instead of at what they cannot is a failure of the previous Labour Government—a failure that I will not preside over. 
Long overdue change is on its way and this is the first stage of this second-term Government’s welfare reforms. It is with good reason we start with our youth. Our next bill will include a change of category for all benefit types increased work obligations for those on the current sickness benefit penalties for recreational drug users who do not pass a drug test to get a job and cancellations of benefits for some with outstanding warrants for their arrest to name a few of the changes on their way. But this bill is really about our youth and it is also about making some changes for women living alone widows and work testing on the DPB. 
To come to this policy change we looked at who was coming on to welfare and why and any of the reasons around that are complex. Of the approximately 10000 people who go on to welfare at the age of 18 or younger their backgrounds are often complex and varied. Education has not really worked for them. They often lack strong role models and the life skills to get them ahead in life. Of the estimated 14000 young people not in employment education or training we know that up to 90 percent of them will go on a benefit by the time they are adults. We have to stop that flow. This is a group that Labour and the Greens do a lot of hand-wringing about. They use them to gain political points. But the Opposition made absolutely no difference to this group while it was in Government. 
This group of at-risk young people who are disengaged now have a National Government that is standing up and backing them. We will give them the kind of support that they need by contracting with an external non-Government provider. These providers will have the flexibility on how they work with these 16 and 17-year-olds but will be very clear on the outcomes that the Government is purchasing. The emphasis without apology is on education and training and life skills. Some young people will need intensive and expensive support; others not so much. We are actively targeting these young people because we believe that with the right support they can get the education and training they need to work keeping them out of the welfare system and stopping that cycle of dependence. 
In respect of teen parents this Government is the first to truly support teen parents on welfare. In 9 years under Labour these teens got nothing but a weekly lump sum of cash to spend however they liked. These are teenagers and they need help to learn the skills to be good parents to manage a budget to pay the bills and to live well. They also need someone to believe in them and help them see a brighter future than the one that they will get on welfare. This Government will do that. We are providing the budgeting and parenting courses. We will ensure they finish their education and get training so they have the skills to one day work in a decent job. Remember these are teenage parents and we have a responsibility for them. We are providing $80 million extra in childcare for these teen parents to allow them to do these things because we understand that that is the kind of practical support they need. We are providing the right incentives and obligations within the welfare system and removing the barriers to them gaining independence. That is what we mean by an active system. 
As a result of the select committee process there have been some changes to the bill. They are largely technical but worthwhile and I welcome them. I thank the chair of the Social Services Committee Sam Lotu-Iiga who has done an outstanding job as chair. He will discuss more of the detail of this bill in his speech tonight. 
There are those who will say that the right talk about welfare only when we want to polarise the nation or draw attention away from someone else. I say that is rubbish absolute rubbish. Every day as Minister I have worked to better the lot of those on benefits and this Government will continue to do so. We can and will make a positive difference for beneficiaries in this country. 
I hear much criticism of National’s stance on welfare dependence. I am yet to hear an alternative from the Opposition except to give them more money each week. I ask Opposition members to tell us in their speeches whether they will reverse these changes. Will they take away that support from teen parents and young people which is so desperately needed? These changes will lead to better lives for thousands of New Zealanders and I commend them to the House.  
Mr DEPUTY SPEAKER 
: Members I have to confess that there has been an error on behalf of the presiding officer. I read the drill sheet verbatim and those who were vigilant would have noticed that after sending the previous bill to the Local Government and Environment Committee I then reading the drill sheet said: “This bill is set down for Committee stage next sitting day.” and that cannot happen. I will rule that the comment I made about setting the bill down for Committee stage will be set aside from the record of the House. Much in all as the presiding officer has some powers they simply cannot do that. But to save confusion that will be removed.  
JACINDA ARDERN (Labour) 
: 
 Anyone listening to that speech by the Minister for Social Development might be under some misconception that this bill the Social Security (Youth Support and Work Focus) Amendment Bill actually does more than it does in reality. If this bill was indeed about removing barriers for the large number of New Zealanders who find themselves in need of Government support right now I might be inclined to agree with the Minister but that is not what this bill does. In fact the Minister even referenced in her speech the number of New Zealanders on the sickness benefit in particular and said that unlike the Labour Party she was not patting these people on the head. Not only do I take personal offence to that statement but there is nothing in this bill that assists anyone on a sickness benefit from illness into wellness and into work. This bill does not even refer to people on a sickness or an invalids benefit. It barely touches them.  
So who does this bill affect? The Minister rightly pointed out that she is targeting young people. “Targeting” is the right word. We have 87000 young people not in employment education or training—87000. This bill tackles 1500 of those young people. I applaud the Minister. Those are the 1500 teen parents. 
Hon Paula Bennett 
: That’s not true. Don’t make up the numbers. You are better than that. Don’t make up the numbers.  
JACINDA ARDERN 
: I applaud the Minister for extending childcare payments for those teen parents but there are 1500 of them. 
Hon Paula Bennett 
: Come on. You read the facts and you know it. 
JACINDA ARDERN 
: If the Minister thinks there are more than 1500 I would welcome her tabling that evidence because that is the evidence we have received. But there are 112000 parents on the domestic purposes benefit. Now I am coming to the extra 1000 on the independent youth benefit— 
Hon Paula Bennett 
: 14000; you know it works for that many.  
JACINDA ARDERN 
: —the extra 1000. Those young people are being put on a plastic payment card and are a number of the select few who will get additional services from this bill. But there are a vast number more who are locked out by this bill because 18 and 19-year-olds will no longer be picked up by services that used to exist for them. Those are the 14000 whom the Minister is speaking about. That is vastly fewer than the number that Youth Transition Services is currently eligible to pick up. I am not mixing up the numbers on this bill Minister. It is just a fact that there are small subsets of people who will benefit from it and not the vast numbers that she refers to.  
There used to be a time when we referred not to “welfare” but to “social security” and there was a reason for that. In 1938 the unemployment benefit was brought into New Zealand with the criteria that a person must be 16 years of age and over have been in New Zealand for at least 12 months is unemployed is capable and willing to undertake suitable work and has taken reasonable steps to secure employment. Not a lot has changed from that criteria but neither has much changed about New Zealanders’ desire to work—their absolute desire to be in work. We acknowledge on this side of the House that whenever you bring in a universal system there will be a small minority of people who will abuse it. It is exactly the same for the tax system in New Zealand. It is a universal system that is abused by a minority of people and just like we must deal with those who abuse the tax system we must deal with those who abuse the welfare system. But we must never allow ourselves to be guided by the minority when we legislate around the majority. That is where I want to bring a few facts into the discussion.  
The Minister is right to compare the difference in unemployment numbers that we have in this country. At the beginning of 2008 we had roughly almost 18000 on an unemployment benefit. Now it is closer to 50000. We have not had a sudden and dramatic change in attitude to work; we have had a recession.  
Hon Paula Bennett 
: What’s happened in the last 2 years? 
JACINDA ARDERN 
: We have had an economic downturn and I acknowledge that Minister but that is a reflection of the fact that New Zealanders have not made a choice to be on welfare and to be on unemployment benefits. That is why we must focus on the economy if we want to turn round welfare.  
Secondly let us actually use some of the evidence we have got from those who are on different forms of benefits. The Inland Revenue Department did a survey of those who have been on the benefit and found that 64 percent said that they did not have the skills they needed to get into the jobs that they were trying to get themselves into. The Government in this bill has not done anything to address the fact that so many of those who are on Government support right now do not have the skills and education necessary to move into those jobs. Instead it changed the criteria to the training incentive allowance. It cut out vast swathes of women in particular who were trying to access education to better themselves in the workplace.  
I have an example of the kinds of policy that mean that people are not able to get into sustainable long-term employment. I recently had a domestic purposes benefit recipient approach my office and tell me this story. She had been in work for a couple of years when she found herself pregnant. She had a toddler when her partner decided he did not want to be a father and left her. She managed to find work—10 hours a week in hospitality—but was still on Government support and did not want that for her or her child. She went to Work and Income and asked whether there was any assistance available so she could get into foundation courses to become a nurse—the kind of job that would get her off the benefit in the longer term. And do you know what Work and Income told her? Work and Income told her that she would not be eligible under its criteria because she had work—because she had 10 hours’ work a week and was still reliant on Government support. That is the kind of system that leaves people trapped in our welfare system rather than offering them the opportunity to get into sustainable long-term work that gives them and their child a better future.  
The Inland Revenue Department also found that 67 percent of those on welfare had a problem getting work that paid enough and 66 percent could not get enough hours. That makes it sound like those parents in particular who are on the domestic purposes benefit which is roughly 112000 at the moment are making a choice to stay on that benefit because they are better off. Let us just look at the facts. The average amount that someone on a domestic purposes benefit gets before an accommodation supplement is $288 a week for them and their child—$288 a week. If we have parents in this country who are finding themselves not better off going into work when they are getting only $288 a week on the benefit that suggests that there is something vastly wrong with our system—and there is. Actually the Minister has acknowledged it in the bill and that is childcare costs. The Minister has acknowledged that by saying that she is going to extend the child support payment for teen parents from the $3.91 they are currently eligible for to $6. 
Hon Paula Bennett 
: Would you take away the $80 million? 
JACINDA ARDERN 
: I applaud the Minister for doing that. She does not want to hear praise. She is barracking across the other side of the House rather than listening. I do applaud the Government for improving child support for those teen parents. But that is 1500 young people. There are 112000 DPB recipients who are not eligible for that extension and support and who therefore still struggle to find jobs that will cover the costs of caring for their child. This has to be about making it a viable option to get back into work. That means making sure our parents have the skills and education and that we also look to the real barriers to them getting back into the workplace. And we cannot ignore the costs of childcare and support in looking at that basic issue.  
 But let us not forget the basic fact that 65 percent of people on the DPB come off it within 4 years. They come off it as soon as they are able to improve their childcare arrangements and that is because of course 20 hours of early childhood education cuts in at about that point. If we could do more to improve that accessibility what a vast difference we would make for the number of parents who are reliant on Government support at the moment. This has to be a debate based on fact and a debate based on the reality of what the people whom we are debating here are talking about in their day-to-day lives. That means it has got to be about work and it has to be about addressing those real barriers.  
I will acknowledge that there are one or two examples of that in this bill but by and large there are not real examples that will make a major difference to the majority of New Zealanders who find themselves on social security in New Zealand. I challenge the Government to turn round its approach to welfare to being not one of social shame but one truly of social security. 
Peseta SAM LOTU-IIGA (National—Maungakiekie) 
: 
 I rise to support the second reading of the Social Security (Youth Support and Work Focus) Amendment Bill. It is a pleasure to support Minister Bennett and Prime Minister Key in bringing these reforms to the House. These changes as the Minister for Social Development has pointed out are well overdue. We know that 13 percent of our working-age population are on a benefit. We know that we spend more than $7 billion on benefits annually and that is $20 million per day or $67000 for the time it will take me to give this speech. Critically we know that 220000 Kiwi kids grow up in benefit-dependent homes. We know that long-term welfare dependency is failing our families and their kids. This National Government behind Minister Bennett is standing up and saying that we are going to do something about it. We believe that those who can work should work. But we know that those seeking work sometimes need encouragement and support. These welfare reforms will provide that. Crucially we believe that those who are in genuine need of assistance—those whom Ms Ardern talks about—will receive welfare going forward.  
So how does the Government achieve this? Well it does it by investing into the future of our families—the lifeblood of our communities—for the benefit of our nation. Budget 2012 provides an upfront investment of $287 million to support more long-term beneficiaries into work.  
Le’aufa’amulia Asenati Lole-Taylor 
: Going forward? 
Peseta SAM LOTU-IIGA 
: That is right. It is about facts as Ms Ardern asked. The facts are that $80 million will go into early childhood education childcare. More facts—$55 million will go into front-line services to assist job seekers and sole parents into work. More facts—$149 million will go into wraparound services which I will come to later in this speech.  
So what does this bill do to help people into work? Well it places on young people receiving the new youth payment or young parent payment obligations to improve their educational and social outcomes. These changes though are not merely about reform; they are about changing the focus attitude and behaviour of those on welfare. This will have a greater emphasis on work and support those people in every way to achieve their own dreams and aspirations and that of their families. It is about getting behind people. [ 
Interruption 
] That is right. It is about getting behind people so that they can realise what they can do not what they cannot do as Ms Ardern keeps pointing out. Resources will be available particularly to those who are at risk of long-term welfare dependence. Young people will be supported to make better choices: to stay in education training or work. They will be provided with financial incentives.  
Dr Rajen Prasad 
: Nobody believes this. 
Peseta SAM LOTU-IIGA 
: That is what this bill does Mr Prasad. They will be provided with financial incentives to utilise budgeting services and parenting programmes. These are part of the wraparound services and assistance for those receiving benefits.  
We are no longer just going to hand over benefits like the Labour Government did and leave people to their own devices. Instead we are going to take an active work-based approach because we have greater aspirations for New Zealanders and their children than that lot did. This is achieved through hard work and not welfare. We want people to stand and support themselves to make good decisions that affect their lives positively. We will be there to encourage and support them. So this welfare programme will put a clear emphasis on work availability and preparation requirements for those who can work. This will affect sole parents widows women alone and partners by requiring sole parents with children aged 5 years and over to be available for part-time work. It will also require sole parents with children aged 14 and above to be available for and seek full-time work.  
Dr Rajen Prasad 
: Where is the evidence this works? 
Peseta SAM LOTU-IIGA 
: But what it does—and Mr Prasad knows this but he denies it—is provide clear expectations and obligations. It is a genuine partnership between the State on one side and those who receive State assistance.  
So what do these reforms look like in practice? Last year I met a young lady of 18 in my electorate of Maungakiekie. She had an 18-month-old baby and was heavily pregnant with another child. She was living in a cold damp garage and finding it hard to make ends meet. She and her family had literally—literally—fallen through the cracks and they were living in squalor. Under these new reforms we will be supporting this young woman with income support budgeting parenting services and access to training and education.  
Dr Rajen Prasad 
: Ha ha! It’s there now.  
Peseta SAM LOTU-IIGA 
: Mr Prasad might laugh. He might laugh but despite his protests this young lady and her children will welcome the assistance that this Government will provide her going forward.  
Finally you hear Mr Prasad Mr Sio and others across the Chamber asking where the jobs are. I will tell them where the jobs are. The latest household labour force survey shows that more people are being employed in this country than ever before. In March 2012 there were 2230000 employed. That is more than at any time in our history. This is 30000 more people employed than when this Government took office in November 2008.  
Dr Rajen Prasad 
: How many are out of work? 
Peseta SAM LOTU-IIGA 
: Do your research Mr Prasad. The SEEK website today had over 16000 jobs available online—12800 full-time 900 part-time and over 2000 for contract positions.  
As I conclude this speech I say once again to these members opposite and the people who are listening out there in New Zealand that these changes are long overdue. They will bring this welfare system into modern times. I want to congratulate the Prime Minister and Minister Bennett once again. They have tackled the very difficult issues facing our society with compassion and care. These measures will make this country bolder brighter and better again. I know that the people in Maungakiekie and New Zealanders across this land are ready for these changes. I welcome them. Long term these changes will move people out of welfare and into employment. That is good for their families. That is good for our communities and yes it is of great benefit to our country. I urge all members of this House right across this House including our Green friends over here to support this Government in bringing about these changes. I commend this bill to the House. 
Su’a WILLIAM SIO (Labour—Mangere) 
: 
 I think that last presentation by the member Peseta Sam Lotu-Iiga reflects the heartless attitude of this Government. I can say to that member that he is not going to return to Parliament in 2014. This Social Security (Youth Support and Work Focus) Amendment Bill introduces a significant shift in the direction of welfare reform and will have an immediate impact on the well-being and welfare of many low-income individuals and families. The Government’s reform will have an immediate impact on the financial and emotional future of those being targeted by this Government—namely young people and sole parents.  
The greatest concern for me is that it will have the most severe effect on the lives of children who belong to families living in poverty or living below the poverty line. As the Children’s Commissioner submitted at the submission stage this bill makes no requirement to take up the best interests of the child or children affected by these reforms. It does not take into consideration the best interests of the children.  
Labour opposes the reform contained in this bill. These reforms are poorly designed they are confusing they lack safeguards and they destroy trust in our young people. As the Salvation Army submitted the bill is fundamentally inconsistent with the intention of the Social Security Act. I agree with the Women’s International League for Peace and Freedom which submitted that this bill discriminates on human rights in terms of age gender and employment status. I believe it when Women’s Health Action said that it gave a comprehensive submission based on evidence opposing this bill because it said it undermines women’s sexual and reproductive human rights.  
We know from the evidence which is so readily available that child poverty exists now in New Zealand. We also know from the evidence that child poverty increases when there is rising unemployment and rising underemployment. That has happened throughout the 4 years that this Government has been in power the consistent trending of rising unemployment and rising underemployment. We also know that when more people are working part-time or casual jobs there is more poverty. When families have low incomes relative to living costs there is a larger gender wage gap and women who choose to become mothers are often penalised in the workforce as they are now under the current environment created by this Government. There is increasing child poverty.  
We also know from evidence that when Governments cut benefits or limit eligibility for benefits or have lower income taxes and introduce higher goods and services taxes these policies also increase child poverty. This is the current economic environment upon which this Government is introducing these significant changes to New Zealand’s social security system.  
Every group or individual that I heard submit was quite scathing of the collapsed process with which this Government drove the introduction of this bill. It gave very little time to individuals and organisations to prepare submissions. According to the Law Society there were groups that could not submit because of the Government’s collapsed approach to public submissions. The Council of Trade Unions probably best summed up the feelings of submitters when it said that the Government makes a mockery of democracy when it rams through significant changes in such a short time frame which limits public contribution.  
The Government reforms target young people and sole parents. We were advised that it is the expectation of this Government that when these young people reach the age of 18 years they will be in employment and will no longer require a benefit. I find that very difficult to believe given that the approach is more of a big stick than a carrot. But even if the carrot was accepted what jobs are available to people? Many submitters questioned the Government about where the jobs are. They questioned what this Government was doing to enable the creation of genuine meaningful and high-value jobs that pay well for workers and their families. Dr Robin Gwynn submitted that having people work instead of just accepting money is an excellent idea but it will not succeed unless there are jobs for people. He also asked the same question every other submitter asked about where the jobs are and said that if the Government believes it has the right to bully people into work it should also ensure that jobs exist for people.  
Under the Government’s bill sole parents will be required to find part-time work when their youngest child is 5 years old. They will be expected to find full-time work when their youngest child is 14 years or older. These changes will apply to women receiving the widows benefit domestic purposes benefit and the domestic purposes benefit for women alone. It is expected that 56300 people with children under 5 will be forced to find work. We were advised that 45000 people with children aged 5 to 14 years will be pushed towards finding full-time or part-time work. We were advised that 21300 people with children aged 14 years or who do not have children will be pushed to have full-time work. Sanctions will apply if people fail to meet these expectations.  
The Government wants to introduce this bill in July. The CCS Disability Action submitted that this bill does not address barriers of single parents with disabled children forced to enter the workforce. The Wellington People’s Centre pointed out to Government MPs that job matching was a huge issue and that many solo mums or widows were on casualised part-time work receiving wages that ensured that they struggled continually to make ends meet. Kay Brereton was lost for words to describe the absurdity of the Government’s bill dictating that if you have a child you will not get a benefit. The Women’s International League for Peace and Freedom said that paid work is not more important than the “unpaid work of child rearing and caring for those in need”. Graham Howell submitted and said that this bill “smacks of social engineering of the worst kind” and is flawed from a conceptual and practical basis. He further said—this was Mr Howell—that the changes will “increase the number of jobseekers all … bidding for low-waged jobs” thus driving down wages.  
Dr Anita Lacey of Auckland Action Against Poverty said the bill “does nothing to address the real causes of poverty in New Zealand which include a poorly performing economy low wages a shortage of decent jobs benefits that are too low for many people to live on and … job insecurity”. The Auckland Women’s Centre showed evidence that showed that women affected by this bill are already under-resourced. They live in poverty have bad health and need to be supported rather than be bullied by this Government. The Auckland Women’s Centre opposes the bill and describes it as mean-spirited and punitive. It said women should be supported and given real choice not compelled or bullied by this Government.  
Labour believes that by and large New Zealanders want to work. This is supported by the evidence that we have seen in the household labour force survey. Not only the thousands of people who line up whenever there are jobs available in supermarkets but also the thousands of New Zealanders who are leaving our shores every week for Australia are clear evidence that this Government is taking this country in the wrong direction. We believe that those currently in need of Government support deserve a set of measures grounded in evidence and the reality of the current economic environment.  
People require a set of measures that address the barriers that exist in moving from the welfare system and into work. They deserve to be treated with dignity as human beings deserving of the means to support and sustain themselves and their families. People need jobs. People want to work. People want to earn an income that gives them dignity as a human being to support their children. The reforms introduced by this Government treat people with disrespect or treat them as nothing less than what people are demanding.  
I now want to conclude. The behaviour of the chair and some members of the Social Services Committee during the public submissions stage was appalling—appalling. Aided and abetted by that chair they consistently challenged submitters. They consistently undermined submitters given the collapsed framework that the public had. I would say that this Government is taking us in the wrong direction. 
JAN LOGIE (Green) 
: 
 It will come as no surprise to anyone in this House I suspect that the Green Party will be voting against this bill the Social Security (Youth Support and Work Focus) Amendment Bill tonight. We oppose this bill for many reasons many of which were just listed by my colleague Su’a William Sio. They reflect the concerns of the people and organisations that got their submissions in but also those that we consulted directly because we were not satisfied that 10 days to get in submissions was long enough. I will be sharing some of those comments directly this evening. 
The Green Party does not believe welfare is all about the individual and our belief is based on several pieces of evidence. Between 1999 and 2008 the number of people on the unemployment benefit plummeted from 161000 to 17000 because the economy was doing better. The number of young girls having babies is trending down without Government intervention. The proportion of sole parents with jobs has increased since the 1990s and has started levelling off only as job growth has slowed.  
 Most people on the DPB are on it for a very limited period of time. Less than 10 percent of current recipients have received the DPB continuously for 10 years or more. We also know that there are really significant and valid actually reasons for people needing the DPB. A large percentage of women accessing the DPB do so for reasons of domestic violence and CCS Disability Action told us during submissions that 25.8 percent of people on the DPB have children with disabilities whom they are caring for. There have also been numerous pieces of research in this country that have clearly demonstrated discrimination in the job market especially based on race age and ability. All of this evidence speaks to structural issues that will not be addressed by this legislation. 
Although the Green Party rejects the individualistic approach for the reasons mentioned above I do understand that at least it is a consistent philosophy for the National Party even if it is not supported by all the evidence. But in the words of the feminist icon John Armstrong National appears to have one rule for women and no rules for men. Mr Key said last year 4300 children were born to mothers on a benefit—a shockingly high figure 4300—so this Government is changing the law to try to stop this changing the law in a way that will potentially take mothers away from their babies once they are 1 year old. Yet all the while the Government is not doing anything to track down the estimated 30000—yes 30000—or so fathers who have left it to the State to pay for the upbringing of their children leaving us with a debt of $2.3 billion. In the words of a woman who has used the services of Women’s Refuge: “I’ve a $30000 debt from studying a level 4 course. My ex has reduced child support to nothing while he continues to travel around the world and tell the kids he doesn’t have any money because he’s giving it all to me. My ex is on over $120000 and honestly thinks he’s poor. I honestly don’t think they know what it’s like not to have $3 to buy milk or to have your phone cut off because you can’t pay the bill what it’s like to have to go through the systems and beg just to look after your kids.” For this House to be considering easing up on child support payments while increasing work testing for women on the DPB and cutting the training incentive allowance for higher-level courses is a validation of that man’s disproportionate sense of entitlement. 
Several submitters through the submission period spoke about the punishment of beneficiaries and the stigmatisation. John Key and the Minister for Social Development have said that beneficiaries need a kick in the pants that beneficiaries are living a dream choosing a lifestyle and have to use a food bank only because they are making poor choices or do not know how to budget. These comments alongside the vilification and misrepresentation of beneficiaries who dare to put their name to their concerns create the context of this bill. This lifestyle or dream has been described by one of the women I spoke to: “When I left”—a violent relationship—“I looked online for forms and information and went in. But it turned out I hadn’t filled in the right forms or didn’t have the right ID or something so I had to get another appointment. That happened so often. It’s really humiliating and demoralising sitting waiting always waiting then having to tell a random person your story in front of the whole office. The other day I was telling my story again and the woman next to me was saying ‘Oh that’s terrible! They really have to give it to you.’ That was nice but sometimes you just don’t want everyone knowing your story.” That is the dream. 
The new model of a wraparound service for young people is promising a lot—except jobs—but in the words of a young woman who used the independent youth benefit recently: “I have friends who go to places and they promise promise promise and then more people come in and they forget and my friends just get lost.” Although tying funding to outcomes may be a motivator for the organisations to get their act together this is really specialised work and trust is particularly hard to build especially when you are going to have to report the young person to Work and Income if they do not comply. In the words of another young woman who knows: “Service providers need to take time to get behind the front. We learn to have a front to be tough. Once you cut their benefit they’ll just get more gangster—more crazy. More crime is going to happen for sure. You can always swap your food card for drugs and smokers will just go to the dairy and steal them.” 
The Green Party agreed with the presenters who wanted to see the successful schemes like the one in Otorohanga and Southland’s Work’n it Out replicated. We believe in investing in young people. Rather than create a whole new scheme that is not grounded in evidence and that creates ethical challenges that have meant that a lot of respected providers have not applied for contracts we would replicate the programmes that work. 
Another submitter talked about the difficulties created by the payment cards. They worried about the extra level of bureaucracy being placed between a young person and finding a new place to live when their flatting situations are often pretty unstable and the mixed message that a payment card sends by locking young people into more expensive shopping options compared with farmers’ markets or second-hand stores while supposedly teaching them good financial management. 
Other youth workers and the Children’s Commissioner raised concerns about setting National Certificate of Educational Achievement level 2 as the benchmark. For young people who have been out of the school system for long periods of their life—and some of them have not ever been in it from being refugees—this is likely to be demotivating to say the least. 
Young mothers and other submitters all raised concerns regarding the lack of availability of appropriate courses in childcare. Along with numerous submitters we reject the view that parenting is not valuable work. In the words of another woman: “And honestly monitoring and caring for a teenager can be a full-time job. I am actually really frightened about going back to work. Even my parents who are very conservative anti-welfare churchgoing people have told me I need to stay off work. They said—which hurt at the time—that ‘You’ve been so focused on managing your relationship for the last 13 years that your kids haven’t had the love and attention that they’ve been waiting for.’ If I worked I’d have some more money but no time. The kids need anger management counselling and help with managing their father as well as just some focus.” 
The drivers for welfare are many and complex and so the answers need to be comprehensive. The Green Party is ambitious enough to believe that we can work together with business local government and community to create a productive economy that in turn feeds an inclusive society. 
MELISSA LEE (National) 
: 
 I was just wondering whether we were sitting in this House listening to this debate on the Social Security (Youth Support and Work Focus) Amendment Bill or listening to a drama unfolding and I was about to fall asleep. It was a soothing voice however. I commend Jan Logie for the voice; it was a very soothing voice to fall asleep to.  
This is my first opportunity to speak on the bill and I have to wonder whether those members opposite were sitting in the same select committee as I was because they obviously have a completely different view of what actually happened in the select committee room. So I would like to take this opportunity to commend the tremendous work that the Minister for Social Development the Hon Paula Bennett has actually done. The previous Labour Government in 9 years did not have the guts to actually tackle— 
The ASSISTANT SPEAKER (Lindsay Tisch) 
: Order! Using that term is not acceptable. 
MELISSA LEE 
: Thank you. What I was about to say was that our Minister has the courage to tackle something that the Labour Government did not have.  
When the architects of the welfare system set about designing how it was actually going to work they would never have imagined that we would have 220000 children growing up in welfare-dependent homes or that 170000 people would have been on welfare for most of the last decade. What welfare was designed for was to provide a safety net for people in difficult times and it is still so. But in New Zealand we have long-term welfare dependency which is trapping many people into a life of limited choice poverty and poor health. We all agree across this House that we need to actually do better and that is what this Government is doing.  
We know that often when people enter into the welfare system at a younger age they tend to stay on welfare for much longer and that is a fact. So for me we must provide an environment where these young people who would otherwise have very limited choice going into welfare have a choice for a better life outcome and a brighter future. By identifying these at-risk youth we can provide services to help them re-engage with education training and opportunities for employment and this bill sets out to do just that.  
This bill will deliver a more effective and active welfare system with greater support for our young people as aspects of our current welfare system are out of step with modern life—for example the widows benefit and women alone benefit. The current welfare system simply pays benefits to young people and teen parents and effectively leaves them to it. That is what the Labour Government did. Well that is just not good enough. Often these young people do not have the life skills or the experience to know how to budget or prioritise or to understand that education is what is required for a better outcome. They need good role models and advice on how they can best make things work for them.  
This bill will provide a youth and young parent payment and a youth support provider will work with them to get them back into education and training. The support provider will actually manage the young person’s benefit payments with essentials like rent and power paid directly and an allowance and payment card for living costs. Most of us know how to pay mortgage payments or rent or power on automatic payments because those are the essentials that we cannot spend from our pay packet. We know how to apportion it. Young people do not tend to and we need to actually teach them how to do that. This is a great bill and I commend it to the House. 
Le’aufa’amulia ASENATI LOLE-TAYLOR (NZ First) 
: 
 I rise on behalf of New Zealand First— 
Mike Sabin 
: Nice blue scarf. 
Le’aufa’amulia ASENATI LOLE-TAYLOR 
: —yes a very nice blue—just to remind people on the other side who the real traditional national party is. I rise on behalf of the New Zealand First Party the party that takes pride in its common sense and its realistic approach to social services policies. In fact the Minister for Social Development would do well to seek quality advice from New Zealand First and we are happy to offer that advice.  
I am somehow stunned by the previous speaker Melissa Lee’s poor contribution on this debate. Screaming through the microphone does not necessarily represent quality I must say.  
Let us be real here. The aim of the Social Security (Youth Support and Work Focus) Amendment Bill is to transform the benefit system into one that is modern active work-focused for adults and education-focused for young people. And yes Mr Lotu-Iiga New Zealand First continues to ask the question of where the jobs are. Where are the jobs at the end of the day? Has the Government received funding from the Australian Federal Government for these proposed training programmes? Because we can be sure that it will be benefiting from them. Our tertiary students at present are already on one-way tickets across the Ditch and to other parts of Europe and Asia while the Government shows no intention at all of holding on to them. Instead the Minister proposes to boost a growing exodus.  
In fact New Zealand is becoming an excellent employment agency or shall we say training institution for Australia. Perhaps we should ask Australia to thank the New Zealand National Government for doing this. I recall— 
Mike Sabin 
: They’re upskilling their mining to come home to Northland. 
Le’aufa’amulia ASENATI LOLE-TAYLOR 
: —let me remind Mr Mike Sabin—a former Prime Minister of a National Government who once said that New Zealanders who emigrate to Australia raise the IQ of both countries. Sadly nowadays they raise the IQ of Australia and other countries but not New Zealand.  
Pushing this bill forward suggests speedy implementation of legislation that hopefully does not come under close scrutiny. Yes we believe that reducing long-term welfare dependency is something that this Government needs to address. We acknowledge that but where within these schemes does it provide the solutions? “Where?” is the question. I can tell everyone in this House and those who are listening to this debate now what this bill is a solution to. This bill is merely a concealment. It is this Government’s disguise of a job creation scheme for bureaucracy—in other words sugar coating. It is sugar coating which is probably the more relevant term. 
Tim Macindoe 
: For what? 
Le’aufa’amulia ASENATI LOLE-TAYLOR 
: That is right Mr Tim Macindoe. New Zealand First is concerned about a number of changes proposed in this bill. These include the use of the private sector in finding jobs information-sharing provisions within the bill the wider welfare reform package and of course the cost to the taxpayer. Furthermore we see the bill as a distraction from the Government’s poor economic management and its failure to provide the right setting for job creation. 
Dr Rajen Prasad 
: She’s right there. 
Le’aufa’amulia ASENATI LOLE-TAYLOR 
: That is right. Thank you. I agree with you and I thank you for agreeing with me. Looking at the current benefits that people have access to—namely the independent youth benefit—I see the same expectations laid out for 16 to 17-year-olds. There are the same obligations to be met regarding secondary schooling full-time training and activeness in looking for work. I see exactly the same frameworks surrounding a youth benefit but with a difference in its title and its opening yet again for political cronyism.  
If we look at this bill from its intent on stating the obvious it exceeds all levels. You can laugh about it Mr Lotu-Iiga but we discussed this at the Social Services Committee and we made our view pretty clear. Yes it has outlined that better parenting education programmes and budgeting programmes are needed for young parents. But where are your figures to say how much this will cost New Zealand taxpayers? Where are the figures? What we do not want is the transfer of beneficial funds— 
Peseta Sam Lotu-Iiga 
: I raise a point of order Mr Speaker. I can help this new inexperienced member with the figures. I am quite happy— 
The ASSISTANT SPEAKER (Lindsay Tisch) 
: No you are interrupting the member’s speech. 
Le’aufa’amulia ASENATI LOLE-TAYLOR 
: I can sympathise with that member because he perhaps needs a little bit more education about when to stand up and call a point of order. The benefit system should actively help and promote paid work and independence not create barriers to finding paid work. As my colleague Barbara Stewart once said— 
Tim Macindoe 
: How does this bill do that? 
Le’aufa’amulia ASENATI LOLE-TAYLOR 
: Are you listening Tim Macindoe? Are you listening? I am trying to remind you of what was discussed in the select committee just in case you have a memory problem there. As my colleague Barbara Stewart stated in her speech Treasury has “provided a job forecast of 1.6 percent per annum over the next 3 years.” She made that very clear. The question though is what sort of jobs we are talking about here—what sort of jobs. Since the Government has deceived its voters into believing that jobs would be available there are now more job losses. I can infer only that this forecast is based on optimism which is far different from reality.  
The information-sharing section proposed section 125D in clause 19 screams of a nanny State which the National Government has actually accused Labour of doing. This bill permits certain agencies to disclose information about young persons in certain circumstances. Who then decides which relevant agencies have access? I definitely cannot imagine Peseta Sam Lotu-Iiga to be someone who can give that. Who are these intended agencies—or can I say buddies—and what are the certain circumstances? Under proposed new section 125D there is no explanation given as to which organisation will have accessibility rights and which individuals will have their information shared. We find no problem with the Ministry of Education providing information to the Ministry of Social Development—that is absolutely fine. This is with reference to the provision relating to the use of the National Student Number—we recognise that. In respect of the provision relating to the use of the National Student Number though we will support the inclusion of a specific provision concerning information sharing between the Ministry of Education and the Ministry of Social Development. We agree however with the Privacy Commissioner that the changes in this bill target a group in whom trust in authority may already be in short supply. That is very important to note.  
Modern society norms are what this Government wants to align its models with. Really? Is it normal to ask widows and women living alone to take on board work without taking into consideration their circumstances? Is the Minister saying that the norm of this Government is to be insensitive to these women and widows? 
Kris Faafoi 
: Yes. 
Le’aufa’amulia ASENATI LOLE-TAYLOR 
: Yes I believe so. Women for as long as we can remember have always had an important role in our community and in our families. For women alone in the 50-plus age group where does the Government propose these women find jobs? It is hard enough for youth to find jobs. And what do you say about the older generation’s prospects in this competitive job market?  
New Zealand First opposes this bill and the reason we oppose it is that it does not make sense. New Zealand First said from its very beginning that we will support good legislation and oppose bad legislation. If the intent of this bill actually served a purpose in reducing welfare dependency and gave a real solution to this problem we may have had a different stance. However for these legitimate reasons New Zealand First will not support the amendment bill in its second reading. Thank you. 
TIM MACINDOE (National—Hamilton West) 
: 
 When I spoke in the first reading debate on this bill the Social Security (Youth Support and Work Focus) Amendment Bill I made the comment that the issue we are talking about is probably the greatest challenge of our political generation. I also made the point that I believe the outcome of this bill will be one of the defining achievements of the John Key - led Government.  
Jacinda Ardern earlier tonight misrepresented the figures that this bill will cater for so I want to clarify that we are talking about 14000 young people aged 16 or 17 years who are not in employment education or training. Not a few hundred but 14000. They deserve our help and our guidance and most of all they deserve a future. But they cannot do it on their own or with the soft bigotry of low expectations that characterises the approach over many years of members opposite in this House.  
I am very proud to be a member of the Social Services Committee and I will be especially proud when the benefits of this measure bear fruit as they undoubtedly will.  
Dr Rajen Prasad 
: Will you resign if they don’t? 
TIM MACINDOE 
: Opposition members like Dr Prasad are stuck in a time warp. And those members ignore reality—tragically not at their own peril but at the peril of those whom they claim to represent and whose interests they are unquestionably failing. I endorse 100 percent the outstanding work of our Minister for Social Development Paula Bennett. She is doing a fine job and a tough job and I commend her for that. I endorse 100 percent the excellent work of the chair of the Social Services Committee Peseta Sam Lotu-Iiga who I have to say has handled the whole process with dignity with courtesy with respect with intelligence and with fairness. And I put that on the record because I have been appalled at the attacks on his character tonight. He is a fine man doing a very fine job. I also commend the excellent work of the very fine deputy chair Melissa Lee. I am proud to stand shoulder to shoulder with all three of those members of this House and I back their effort 100 percent. Let us get on with the job.  
Contrast their efforts and their contributions in this debate with the ideological claptrap of the Opposition speakers. Su’a William Sio accused the MP for Maungakiekie of being heartless. That was the word he used. Well I say to Mr Sio that I take offence at and exception to that claim. Mr Sio should be ashamed of making it because throwing young people into the too-hard basket and patronising them with welfare without expectations is what is really heartless. That is the bigotry of low expectations that characterises the members opposite. Michael Joseph Savage the architect of the modern welfare State would be utterly appalled. What Labour oversaw in the first years of this decade is so far removed from what Michael Joseph Savage and his colleagues envisaged and intended when they established the modern welfare system that I am sure that he and they would disown their successors on that side of the House.  
Mr Sio also attacked the select committee process. Well as I said it was a very well-run process and it was respectful in tone. No one was bullied Mr Sio in that process and no one is bullied by this bill. Dr Prasad’s constant refrain that these measures are punitive is absolute bunkum and I am sure deep down he knows it.  
I would like to say much more on this; I will at future stages. I am proud of what we are doing and I really commend this bill to the House because it is one of the most important things we could possibly do. 
Dr RAJEN PRASAD (Labour) 
: 
 It is always good to follow Mr Macindoe on this particular bill the Social Security (Youth Support and Work Focus) Amendment Bill and indeed many others. Much of what he says does not hold up to scrutiny at all. Indeed much of what the Government members have had to say on this bill does not hold up to scrutiny at all. This is a nasty bill. It has nasty provisions and it is a nasty Government that is trying to foist this upon our most vulnerable.  
There are some things we agree on. We agree with the Government when it says that the best way to assist the people we are talking about is through work. We agree with the Government on that but that is where the similarities end. When Labour was in Government it did just that. It got our most vulnerable into work. It reduced our unemployment to the lowest level in the Western World. When it did that welfare numbers came down people were in work and people got on with it. But that side is not creating work. Labour took an aggressive approach to creating jobs aggressively triaging— 
Melissa Lee 
: Transferred to invalids benefits! Transferred to sickness benefits! 
Dr RAJEN PRASAD 
: That member there who says a lot took the shortest call possible and promptly fell asleep. Melissa Lee had better listen and argue this particular point because I do not know where that member was when this bill was being debated.  
What this Government has done in this particular bill is what it has done in the ACC area and in other areas as well and it is doing it now in local government reform. You create a problem—you create the figment of a problem—then Mr Macindoe you apply your own ideology. That is all this Government is doing—applying its particular ideology. The language we hear from this Minister for Social Development is: “We will back the young people.” If this is backing the young people then this is not backing at all. To what extent is this backing young people? I shall go through it step by step and show Mr Macindoe how that really is indeed intellectual dishonesty because it is not backing young people.  
The process of submissions was truncated—it really was truncated—for no good reason. The only reason the Government gave was: “Oh well welfare reform was introduced last year. People have had their say so we need a very short period.” What was the Government frightened of? Was it that too many people would come and tell members opposite that this is a bad idea? On another bill before the same select committee the Social Services Committee we have a long long period of time for submissions and it is not as important as this bill. It has already had other reports done. But here members on that side are saying: “No let’s truncate.” 
 You know my colleague Su’a William Sio went through the submissions absolutely honestly and religiously. I am happy to quote it back to the members opposite absolutely and honestly. I have my notes from the select committee. I am happy to read them out to the members opposite. What he said was exactly what the submitters said.  
Submitters did not support this bill at all—at all. I do not know where those members opposite were but they must have been asleep. Sam Lotu-Iiga was far too busy managing the process and not listening to what people were saying because if he had listened this bill would not have survived in this form. It is a travesty. It is a travesty to the power of a select committee. It is just not trusting our responsible citizens to come to the select committee and make submissions. That side did not hear. Can Mr Sam Lotu-Iiga put hand on heart and say that the Government heard the submissions and has made the changes? 
Su’a William Sio 
: No he can’t. 
Dr RAJEN PRASAD 
: The member cannot because the member had instructions from his Minister whom they are all singing great praises of. I do not know who is in for promotion next but Todd McClay has done a travesty to his own.  
Listen to the figures. There were 85 submissions 50 opposed nine supported and six were unclear. Do the maths. If you do that maths it makes 73 percent who opposed the proposal—73 percent. Applying the standard of the debacle of the class sizes the Government should walk away from this bill. It should walk away from this bill because it has no legislative ability to do this. It has none at all.  
The Government talks about taking an investment approach. An investment approach? My big toe! There is no investment in this. If we invested in jobs then that is an investment approach. The marketeers have come up with a nice slogan: “Let’s use an investment approach let’s use the social service language of wraparound and we will get there.” The Government will not get there because there is no intellectual honesty about this particular approach. This is a mean Government. Its approach is insincere. It is a punitive approach. It is uncharitable. It cares little for the most vulnerable in our society. That is what this Government has done.  
You know it is ironic that this Government is so hell-bent on doing so much damage—and this bill will do damage. If that member Mr Macindoe believes this will be his finest hour then I feel sorry for him. This cannot be his finest hour. This is going to be quite pathetic—quite pathetic—because there is no investment in this particular approach.  
Many submitters rejected the Government’s approach to solo mothers who are bringing up a second child. Now after 12 months that mother has to go to work. For a moment Minister turn away from the mother and focus on the face of the child. What does the child need? What did the child do wrong? That child needs the mother there for as long as any mother can stay at home. But no that Minister in a nasty way will take that away from our young babies and that is mean. That is mean-spirited. What is there about an investment approach in that? That baby will need that mother. It is not the baby’s fault that the baby has been born but that is a fact. The least we can do is support them to get the best service to bond and to have the time together.  
It is quite ironic that this Government talks a lot about evidence. I want the next speaker or any member of that Government to get up and tell me what the theory is that actually says that this is the way to treat young people. We are taking the very tools we have to train them taking their money away from them and locking it up somewhere. Every theory I know—and I have studied this—says that power to make decisions shifts as the child grows older.  
The independent youth benefit has been a problem. Some parents have had difficulty with this. This is the group of young people who have really split with their own families. Those families have not liked this benefit because somehow they have blamed the benefit but the benefit has been a response to those parents who have really disenfranchised their own children and separated from them. The State has had to look after those young people and now those families have the ear of this Minister. They have had the ear of this Government. They have had the ear of this particular Cabinet because the Government is devising mean policies to ensure that they can come now and be punitive. There is no science in this approach. People presented to us and said that when this approach was used in America it actually increased dependency. It actually increased it. So where is the evidence? Let the next speaker tell me where the evidence is. Let the next speaker tell me where the science is because it is not science. All it is is a series of punitive mechanisms.  
Submitter after submitter said that this was mean this was bullying this was punitive and this will not work. Name me one respectable organisation that submitted and I will read the submitters out. The Human Rights Commission the Children’s Commissioner—they all said the same thing. Nine people supported this particular measure. Mr Macindoe by any standards you should have the courage to say that at least other people thought very differently.  
How does this move our people further? How does this really get young people to grow up perfectly? How does this actually give our children and our babies the best possible start in life? It does not. Somehow because someone is a beneficiary this Government is entitled on our behalf to be mean to them. Well this side will never do that. This side will invest in the proper sense as indeed it has for a long time. This side will get those people an education will get them jobs.  
Government members of that select committee cannot be proud of the way in which they conducted themselves. It was not a happy select committee; it was a mean select committee and the members did not conduct themselves well. I was not pleased to be part of that select committee Mr Macindoe and I am sure that you were not as well. What that select committee was doing was railroading using this Minister’s directions to you. Mr Macindoe you and your colleagues took leave of your senses to just look at the evidence look at the science and take cover. Your ideology got in the way just like your asset sales ideology does. 
ALFRED NGARO (National) 
: 
 I proudly wear this ribbon here. It is the purple ribbon which stands for World Elder Abuse Awareness Day. In respect of that I will not abuse our elderly gentleman over here Dr Rajen Prasad but instead I will give him some reality. Here I stand in front of the House hand on heart and I shall say to the member that I in the Social Services Committee heard the submissions—hand on heart. Not only did I hear the submissions all 21 of them—and 20 of them were written by the Labour Party—but I heard all that they had to say. So there you go. To the honourable gentleman I say that I heard them hand on heart. But the words that were shouted out and ranted from over there were about theory. I want to acknowledge the honourable member Rajen Prasad as a lecturer and teacher of theory. But I stand here today not as a member of theory but as a member of reality because this party is the party of reality.  
The member wants to hear about where the evidence is. Well let us just say this. The Welfare Working Group took a longitudinal study around the Ministry of Social Development and began to see the impacts of long-term dependency on those who were on a benefit. And what it clearly showed—here is the reality—were the negative effects that it had on those who are on benefits. How can you argue with that? This is reality; this is what we are giving them. So what did we do? The honourable Minister for Social Development Mrs Bennett turned round and said that we want to deliver better public services we would have better choices and we want to bring our people out of poverty. We want a more active welfare system. That is what we want; we want a more active welfare system. So this Social Security (Youth Support and Work Focus) Amendment Bill will not only modernise what is an outdated system but will also enable this workforce. This is a thing that I suppose— 
Dr Rajen Prasad 
: I raise a point of order Mr Speaker. It is a serious point of order. The member has referred to a study but he has not told us what study it was. 
The ASSISTANT SPEAKER (Lindsay Tisch) 
: No no. Once again that is interrupting a member. I pulled up a Government member for doing the exact thing earlier. These are debating points.  
ALFRED NGARO 
: Thank you Mr Speaker. This is the thing that I said. Again here is the point of reality and this is what Labour members do not like. They do not like the reality looking straight at them. And that is it because the reality is this. In the election with all the promises that were made by that party what did it do? The reality is it lost its votes. We did not lose our votes. We gained our votes. So here is the reality. You have become a one-trick pony. You have kept our people in poverty. You keep preaching the same message— 
The ASSISTANT SPEAKER (Lindsay Tisch) 
: Order! 
ALFRED NGARO 
: Sorry Mr Speaker. Labour has kept our people in poverty. That is what it does. Why? Labour members still want to say that our people need benefits. What we are saying is that we need opportunity. That is what this bill will do if that opportunity is given to us. So we stand here hand on heart and we heard the submissions. We are no longer about theory—we are no longer about theory—we are about reality and about giving our people an opportunity so that they can see a brighter future. Thank you. 
The ASSISTANT SPEAKER (Lindsay Tisch) 
: Is this a split call? 
Dr Megan Woods 
: It is. 
The ASSISTANT SPEAKER (Lindsay Tisch) 
: I call Dr Megan Woods. 
Dr MEGAN WOODS (Labour—Wigram) 
: 
 I am very happy to rise to speak against the Social Security (Youth Support and Work Focus) Amendment Bill especially after listening to what we have endured in this House tonight. We have been told that Labour has kept its people in poverty. We have even been misled when the member opposite Alfred Ngaro put his hand over his heart. Well we might like to suggest it was covering a gap so that the wind did not whistle through. This is a serious issue that we are facing here: to be told that Labour has kept our people in poverty. Well let us talk about the facts. We heard his colleague the chair of the Social Services Committee talking about how National has created more jobs than ever before. Well here is Statistics 101—that is called population growth. The simple fact of the matter is that there are 52 percent more unemployed people in this country than when the members opposite took office. They should be ashamed of themselves. They have thrown more New Zealanders on the scrap heap through their inaction and their inability to do anything to create jobs in this country. 
The reality is that there are now more than 40000 people on the unemployment benefit. There are 50000 New Zealanders leaving this country every year. If you want to talk about taking people out of poverty create jobs. When Labour came into office in 1992 there were 162000 people on the unemployment benefit. By the time we left office in 2008 there were 17700 on the unemployment benefit. This is the way that you beat poverty. We are hearing some heckling from the members opposite about getting real in the real world. I want to read a quote from John Key at the Job Summit when he launched the beginning of this brave new world and the glittering future that National was going to offer. At the Job Summit Mr Key said: “I don’t want to spend much time talking about how difficult economic conditions are at the moment … I’m here to do something about it.” Well he has done precisely nothing except preside over an ever-increasing dole queue and that is not good enough.  
What is more this bill has young New Zealanders paying for the deficit of the Government’s thinking. Those members have no idea how to create jobs. I want to focus on some of the impacts on young people of this bill. In the Budget it was trumpeted that there was going to be an upfront investment of $287.5 million over 4 years. Well this comes at the expense of $155 million that is already committed—let us not kid anyone here—and $58.8 million of that is being cribbed back from the Youth Transition Services scheme the very scheme that is there to get young people from training and into work. We have no objection to wraparound services but we do not see why you would get rid of a scheme that actually in many cases is being successful. Why not build on the scheme that is already there? That is what we believe would have been a far better solution. We think it is really telling in places where the scheme is working and the obvious model was with Dale Williams in Otorohanga and Youth Transition Services. The fact is that these people did not even tender in the first round. These people do not see how the new schemes being put in place are going to work. We have zero to two young people in that area who are unemployed. 
 We also have huge concerns about the tendering out of the provision of these services. We have clear evidence from Australia and we have clear evidence from the United Kingdom that there is gaming of the system and that the incentives are not there for providers to actually get young people into success. When you get paid your $1200 bonus for getting someone to National Certificate of Educational Achievement (NCEA) level 2 you do not have to be a genius to work out that the providers are going to steer clear of the most challenging kids many of whom do not even have NCEA level 1. The effort required to get them to level 2 is just going to be too immense in the time frames they are given. This is not a bill that is designed to help young people. This is not a bill that is designed to create employment. This is a bill that has young people once again paying for— 
The ASSISTANT SPEAKER (Lindsay Tisch) 
: I am sorry to interrupt the honourable member.  
METIRIA TUREI (Co-Leader—Green) 
: 
 A great deal has been said tonight about all of the failings of this legislation the Social Security (Youth Support and Work Focus) Amendment Bill and I agree with it. I am pleased that our party the Green Party is opposing this bill. 
This Minister for Social Development Paula Bennett uses rhetoric to disguise her culpability in pushing more women and more children into severe poverty and hardship. This Minister Paula Bennett spreads deliberate misinformation because she knows that there is no evidence to back up these policies and in fact all the evidence shows that they will fail women and children. This Minister Paula Bennett knows that harm will come to women and children because of her reforms and yet she cares nothing for the impact on those children or their lives. This Minister Paula Bennett is stealing the future from those in poverty and hardship. This Minister is punishing women for being mothers.  
We can choose a different future for our children. We can choose a different future for all our children rich and poor if we choose to treat our children with dignity and with justice. So I want to outline some of the solutions that the Green Party has for dealing with these issues to bring women and children out of poverty.  
First research across the world proves that educating mothers significantly increases the well-being of their children. So for those who are on benefits the first most important thing to do is to invest in their education. We will bring back the training incentive allowance for DPB recipients and extend it to those on sickness benefits and to all levels of study so that other women like me and Paula Bennett who got degrees and got properly educated while on the benefit are able to do so as well. And we will extend it to sickness beneficiaries because they too should be entitled to further training so that they can get a decent high-level education for their future and for their kids. 
We will extend the in-work tax credit to beneficiary families because although this Minister Paula Bennett cares nothing for the family of two adults and two children that is on the benefit that has to survive on $75 a week after rent and food we do care about that family. We know and any New Zealander listening to this debate will agree that that family simply needs more money to make sure that their kids are properly fed properly clothed and properly housed. No MP in this House would ever expect themselves or their families to have to live on $75 a week after paying rent and food.  
But this Minister Paula Bennett cares nothing for those children in that family those children who are hungry and cold and she will intentionally discriminate against those children. The Green Party will not discriminate. We will make Working for Families fair for all New Zealand kids not just those who are wealthy. We will make sure that people are earning a decent wage when they do work. The Green Party will not tolerate the modern-day slavery wages that too many people—mostly women—earn in this country. A living wage is the best next step—to make sure that work does actually pay—to truly bring people out of poverty. When four out of five New Zealand families have struggled to put food on the table in the last few years we know that work is not a ladder out of poverty if wages are kept low. This Minister and the Government she belongs to deliberately keep wages low to keep families in poverty.  
Tonight we heard from Jan Logie the stories of women living on benefits—their real lived experiences. We heard in their own words their fears for their kids fears for their future and the shame that is brought upon them by this Minister’s degradation of them as women and mothers. Paula Bennett will force these women into work and their babies into day care to punish them for getting pregnant. She got what she needed out of welfare and now she kicks the ladder out from under her. Melissa Lee yawned when she heard these stories of women fearful for their children’s future. I guess to kick it off the National attitude to women might be to listen to those stories of women and their fears for their kids and liken them to dogs. Thank you. 
MIKE SABIN (National—Northland) 
: 
 It is a shame that Metiria Turei’s speech was not beamed into New Zealand households at 6 p.m. because then they might get to really see what the Green agenda is all about—this absolutely ridiculous notion that trying to support young people into work is about forcing them into work. Well what part of the equation do the Green Party and those in “Labour Land” not get? The all-are no-responsibility lifestyle on welfare is just not a go.  
The reality is that over a period of 9 years of Labour and the Greens in charge what we actually saw was a morphing of our welfare system into a welfare trap. At its peak some 350000 people were beholden to the Government for a benefit at a cost of $22 million a day—$8 billion a year. It was completely financially unsustainable but more so was the human capital cost—far more. I am talking about the loss of choices the loss of opportunities the loss of self-belief the loss of purpose and the loss of hope in individuals who were sitting there beholden to a Government that at the time thought that throwing a few crumbs at them and keeping them beholden was a good way to stay in office. That time has come to an end.  
This Government is prepared to tackle the challenge of welfare dependency because we back these young people. We back these young people to have a life and to have an opportunity and we are putting in place the support the mentoring the training the education and the opportunities that these young people need to get their lives back on track. We back them—and it is hard. This bill deals with deals with some 14000 New Zealanders young teenage New Zealanders 90 percent of whom in the absence of our taking this step will be on a collision course to an adult benefit and that is where they will stay for some time and that is unacceptable.  
The Social Security (Youth Support and Work Focus) Amendment Bill is about backing those young people rather than leaving them to sink or swim because we know that most of them will sink. This bill is about us backing our children our young people with training childcare education management of their bills and mentoring. This bill is about us doing what young New Zealanders need. I commend the bill to the House. 
The question was put that the amendments recommended by the Social Services Committee by majority be agreed to. 
A party vote was called for on the question  
That the question be agreed to. 
Ayes 63 
New Zealand National 59; Maori Party 2; ACT New Zealand 1; United Future 1. 
Noes 57 
New Zealand Labour 34; Green Party 14; New Zealand First 8; Mana 1. 
Question agreed to. 
A party vote was called for on the question  
That the Social Security (Youth Support and Work Focus) Amendment Bill be now read a second time. 
Ayes 63 
New Zealand National 59; Maori Party 2; ACT New Zealand 1; United Future 1. 
Noes 57 
New Zealand Labour 34; Green Party 14; New Zealand First 8; Mana 1. 
Bill read a second time. 
Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill 
Second Reading 
Debate resumed from 30 May. 
GARETH HUGHES (Green) 
: 
 Kia ora. It is great to have 1 minute left to talk about this bill the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill. In the first 9 minutes of my speech on the bill I talked about all the reasons why the Green Party is opposing this bad legislation from the fact that it fails our international obligation to the fact that it prioritises economic development over environmental considerations. It does not preserve and protect our environment which is why we are able to use our exclusive economic zone. It fails to account for climate change entirely. It contributes to legal uncertainty around the precautionary principle. It is just going to be a feeding frenzy for lawyers. It fails to meet the Treaty fails the principles of natural justice and contains no marine protection. And although the Government has gone out to the public asking: “Do you want drilling to be prohibited discretionary or allowed?” it has gone out last week and allowed 40000 square kilometres of our ocean to be at risk. Although we support an exclusive economic zone bill we will not be supporting this exclusive economic zone deep-sea drilling bill.  
JACQUI DEAN (National—Waitaki) 
: 
 Why do the Greens not just come out and say it? Why do they not just come out and say no instead of dressing up their debate around the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill and around various provisions of the bill? Why do they not just come out and say that they want to say no to anything that means advancement for the New Zealand economy? Why do they not just say it? Why do they not just use a little frankness and openness in this House and say what they really think? Why do they not use a little “frack-ness”—frankness—and say what they really think which is that on anything that advances the economic well-being of New Zealand and is to do with the environment they are just going to say no?  
Well in fact this Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill does a number of things. What it does is fill a regulatory gap that currently exists in New Zealand regulation. Outside in the exclusive economic zone currently there is no regulatory framework for activities that occur in the exclusive economic zone area. Yes we do have the Maritime Transport Act and we also have the Health and Safety in Employment Act which provide some environmental protections out in the exclusive economic zone but we do not have currently a framework for regulations and marine consents. That is what this bill does.  
Why the Greens could possibly be against a bill that provides for frameworks for regulations and marine consents quite frankly is beyond me but I am sure they will have another opportunity to put their case to Parliament. What this bill does is provide for independent decision-making from the Environmental Protection Authority. It also gives effect—and this is again where I disagree with the view of the Green Party and indeed the Labour Party—to our international obligations. It is most important to remember—I recall a contribution from a Labour member in the previous time when this bill was debated—that this bill is not about oil spill response. This is not about mineral allocation or marine reserves. This bill is not about fishing.  
During the course of the Local Government and Environment Committee scrutiny of this bill a number of discussions were heard around the Resource Management Act and why it was that the principles of the Resource Management Act were used for part of this bill and for part of this bill were not used. We received some pretty good advice on that and I just want to go over it because for some reason again some Labour members seem to be suddenly very fond of the Resource Management Act and feel that it should be the piece of legislation that is given effect to in the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill. But there are several reasons why it should not be. There are areas of the Resource Management Act that are not applicable to the bill and that is because of the different regulatory context of the Resource Management Act and what is happening in the exclusive economic zone area. I guess for practical reasons there would be provisions describing restrictions on— 
The 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.