Roy Eric: State-Owned Enterprises (AgriQuality Limited and Asure New Zealand Limited) Bill — In Committee 
Roy Eric: State-Owned Enterprises (AgriQuality Limited and Asure New Zealand Limited) Bill — In Committee 
[Volume:640;Page:10059] 
ERIC ROY (National—Invercargill) 
: 
 I wish if I may to respond to the comments made initially by Maryan Street because they do relate to Part 2 and the whole issue about competition and the probable impacts she foresaw of that degrading the service and putting at risk the integrity of the system. There simply is no chance of that happening. As my colleague Chris Finlayson said there is the obligation to sue. But Codex Alimentarius is itself one of the most robust international agreements that exist. If we looked around the world for treaties and agreements that have the degree of robustness that Codex Alimentarius has I suggest we would find very few. New Zealand has such a vested interest in assuring its programme that no meat company nobody who is exporting and nobody who is producing would countenance the thought of doing anything that would negate devalue or put in question the robustness of the assurance that is in there. So I do not see that as being an issue. 
Again I would refer members to the point I made in the first instance. When I was talking about Supplementary Order Paper 120 in the name of the Minister and about the explanatory note of the bill I pointed out he had mentioned talking internationally about having agencies other than the Crown involved. I applaud that; I think that is good. 
I want to tease out a little more about the competitive model because under clause 9 of the bill as first drafted Part 3 of the Commerce Act would not apply to any merger of the two agencies. I thank the Minister for now putting in some triggers so that the Commerce Commission could have a look at that. I am referring on Supplementary Order Paper 120 in his name to Subpart 3 clause 12(3)(a) which states: “the Minister of Commerce and the Meat Industry Association of New Zealand (Incorporated) agree that an investigation and a report under subsection (1) are not necessary;”. There is a trigger that can allow the Commerce Commission to look at the practice and see whether there is price gouging overcharging or anything else that we are concerned about in the competitive model. 
But I have to say that the Boston Tea Party story comes to mind when I read that subsection. The very agencies that can trigger an inquiry by talking to and requiring the Commerce Commission to hold one do not have representatives of the producers on them. The Minister of Commerce has overall oversight of—fiduciary responsibility or whatever it is for—the behaviour of State-owned enterprises. The Meat Industry Association represents the industries that do the processing but there is nobody who represents the producers. At the end of the day if there is unseemly charging or if the lack of a competitive model brings up some issues that the Commerce Commission should look at the producers do not have a trigger that they can press. I have tabled an amendment in my name that says we need to include Meat and Wool New Zealand in that loop. That will complete the three elements that are quite important there. 
 As I say the notion we have here brings to mind the Boston Tea Party. If the State and the industry association say they are not happy then the Commerce Commission can be required to do an examination. But in the event that they are not convinced of the need for an examination and the prices are up who pays them? That is the end of the line. That comes off the product price received by producers. Anybody who is out there talking to producers finds that is the No. 1 issue. 
Right now the sheep industry is not in good shape. The Minister needs to put his hand up and say that he hears the cries of anguish about the meat industry which is in serious trouble. One of the things that producers continually say is an issue is the cost of compliance and the lack of a competitive model. This Labour Government took the competition out of accident compensation. Hooray! Oh yes it thinks that we have to have one State-controlled situation to deliver that. I can cite the figures in my own case to demonstrate the cost of that: there has been a 250 percent increase. I have never had an accident compensation claim and there has been a 250 percent increase. It is right across the board. The Meat Industry Association would say that the cost to producers is 90c a lamb or some such figure but has that triggered the Commerce Commission to look at it? No the industry has just passed the costs on back to producers and it comes off the bottom line. So why should we be so encouraged about the provision in clause 12(3)(a) on Supplementary Order Paper 120? 
After our debate at the first reading yes the Minister listened. He has done something but it has not gone far enough because at the end of the day he who pays the piper needs to call the tune. Be it the Boston Tea Party or the Meat Industry Association if there is a tax then there needs to be representation. Any member of this Committee who wants to vote against the amendment I have put forward should stand up and explain why when we are setting up a monopoly agency producers should not be included in the loop that can trigger an examination by the Commerce Commission. I look forward to receiving any response particularly from the Minister in the chair the Hon Nanaia Mahuta who seems to be otherwise engaged at the moment on that very point. Thank you Mr Chairperson.