Volume 669 Week 62 - Tuesday 7 December 2010 
Volume 669 Week 62 - Tuesday 7 December 2010 
[Volume:669;Page:15817] 
Tuesday 7 December 2010 
Mr Speaker 
 took the Chair at 2 p.m. 
Prayers 
. 
Voting 
Correction—Employment Relations Amendment Bill (No 2) 
Mr SPEAKER 
: The result of the vote on the question on the closure motion on Part 2 of the Employment Relations Amendment Bill (No 2) was incorrectly announced as Ayes 69 and Noes 59. The correct result is Ayes 69 and Noes 51. The record will be corrected. 
Speaker’s Rulings 
Questions for Oral Answer—Ministerial and Prime Ministerial Responsibility 
Mr SPEAKER 
: On Wednesday 24 November I indicated to the House that I would reflect further on issues raised relating to Ministers’ accountability to the Prime Minister in terms of the  
Cabinet Manual 
 and the extent to which the Prime Minister is answerable to the House. Standing Order 369 sets out that questions may be put to a Minister relating to the public affairs with which a Minister is officially connected or any matter of administration for which the Minister is responsible. In practice a wide view of the concept of ministerial responsibility is taken but there must be an official connection. Ministers operate in a number of different capacities as set out in the  
Cabinet Manual 
: in a ministerial capacity within a particular portfolio in a political capacity as a member of Parliament representing a constituency or a community of interest or in a personal capacity. 
Ministers are accountable to the Prime Minister for their behaviour in these capacities under the  
Cabinet Manual 
 but the Prime Minister is answerable to the House only where there is an official connection. The Prime Minister is answerable for whether he retains confidence in his Ministers their performance as Ministers and how they manage conflicts of interest in their ministerial roles between their personal interests and their public duty. The Prime Minister is not responsible for action taken in a non-ministerial capacity such as as a party leader or as a member. Nor is the Prime Minister answerable for actions taken by Ministers in a purely personal or private capacity. It can be a hard distinction to draw. 
Although questions will not be ruled out simply because they have a party or personal connection I will rule out questions that ask the Prime Minister to take responsibility for actions or statements that are not taken or made in a ministerial capacity or that ask the Prime Minister to give an opinion on such matters. An opinion that is sought from a Minister must relate to a matter for which the Minister is responsible. 
Points of Order 
Intelligence and Security Committee—Access to Hearings on New Zealand Security Intelligence Service Amendment Bill 
KEITH LOCKE (Green) 
: 
 I raise a point of order Mr Speaker. I seek your advice on an interesting procedural question. This morning I submitted a question to the chair of the Intelligence and Security Committee on whether the hearings on the New Zealand Security Intelligence Service Amendment Bill will be secret. My question was turned down on the basis that the bill is not yet before the committee. Normally I would think that an acceptable response except that yesterday the chair of the committee publicly said that the hearings would be secret which indicates that the committee has discussed this matter. In that situation it would be warranted that the chair of the committee answer my submitted question. I seek your guidance. I understood that the essence of the issue is that if a matter has been discussed and a decision made within a committee then the chair of the committee can respond on behalf of the committee. 
Mr SPEAKER 
: I confess to the honourable member that I was unaware of this situation. I probably need to take some advice on the matter. 
Rt Hon John Key 
: Speaking to the point of order— 
Mr SPEAKER 
: I will hear the right honourable Prime Minister before I rule on the matter. 
Rt Hon JOHN KEY (Prime Minister) 
: 
 I might be able to help clarify the matter. The Intelligence and Security Committee is established by legislation in such a way that it requires the unanimous support of committee members for a position to be adopted. Therefore the position of holding the hearings in public would have to have unanimous support. As chair of the committee I will not be supporting that position and therefore it will not have unanimous support. 
Mr SPEAKER 
: I—[ 
Interruption 
] The Speaker is on his feet. I have listened to the exchange under a point of order because I was unaware of what had happened. The advice I have received though is that the bill is not before the committee and there is no business for which the chairperson has charge. At this moment I understand that that is why a question was not accepted. I certainly am happy to explore the matter further because I confess that the member has caught me unprepared for this situation. That is the advice I have received: the bill is not before the committee and therefore there is no business for which the chairperson of the committee has charge. Therefore he cannot be questioned on it at this stage. 
KEITH LOCKE (Green) 
: 
 I raise a point of order Mr Speaker. For future procedures in the House to avoid part of the confusion we have just seen it would be useful if the chair of a committee did not in advance state and determine his position— 
Mr SPEAKER 
: The member is entering into debate on the issue. I do not think the House should do this. The facts of the matter are that the member was concerned and he raised a point of order about a question he had lodged that was not accepted. The advice I have received was that the principal reason for its not being accepted was that the bill is not before the committee and therefore there is no business for which the chairperson has charge or is responsible. No question can be taken on the matter under those circumstances. 
Hon PHIL GOFF (Leader of the Opposition) 
: 
 I seek leave to table a document in which the then Prime Minister Jenny Shipley said that hearings on the Security Intelligence Service amendment bill would be open to the public. 
Mr SPEAKER 
: What is the source of the document? 
Hon PHIL GOFF 
: The document goes back to 6 February 1999; it was in the  
Press. 
Mr SPEAKER 
: It goes back some years. 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. 
Questions to Ministers 
Trans-Pacific Partnership—Benefits for United States 
1. 
Dr RUSSEL NORMAN (Co-Leader—Green) 
 to the  
Minister of Trade 
: Does he still consider that the United States will benefit from being part of the Trans-Pacific Partnership; if so how? 
Hon MURRAY McCULLY (Acting Minister of Trade) 
: 
 Yes. Clearly all nine parties see the benefits of such an agreement which is why they are in Auckland this week for a fourth round of negotiations. 
Dr Russel Norman 
: Has the Minister been briefed on the submission by tobacco maker Philip Morris on the Trans-Pacific Partnership calling for the US Government to enshrine the right to challenge anti-smoking laws in the Trans-Pacific Partnership agreement; if so does he support such an approach? 
Hon MURRAY McCULLY 
: I have not been briefed on that submission but I am aware of its existence. I point out to the member that this is the fourth round currently under way in Auckland at this moment. It is projected that there will be another five rounds of negotiations next year with an ambition of getting to some sort of resolution in roughly a year’s time. I do not think it would be helpful for us to speculate on all of the submissions and all of the matters that might be proposed by parties associated with these negotiations during that period. Clearly we will find out when we get to an agreed resolution should we do so. We will have an opportunity to comment at that time. 
Dr Russel Norman 
: Will the Minister assure New Zealanders that his Government will not weaken our overseas investment laws as part of the Trans-Pacific Partnership agreement given that the United States has identified our overseas investment laws as a barrier to trade that it aims to eliminate as part of the negotiations? 
Hon MURRAY McCULLY 
: New Zealand has a framework for ensuring that foreign investment is for the benefit of New Zealand. The Government has recently reviewed the overseas investment regime to ensure that foreign investment is in our interests. I assure the member that that is the approach that the New Zealand officials will be taking to these negotiations. 
Dr Russel Norman 
: I raise a point of order Mr Speaker. My question was specifically in relation to whether the Government would weaken our overseas investment laws. The Minister said he likes our overseas investment laws—which is great—but I asked whether he would weaken them and to give us an assurance that he will not weaken them. 
Mr SPEAKER 
: I do not think the member can insist on the Minister giving an assurance. The Minister certainly gave an answer on the Government’s attitude towards our overseas investment laws. In these circumstances I think it was a reasonable answer. The honourable member has further supplementary questions. 
Dr Russel Norman 
: Will he assure New Zealanders that his Government will not weaken our GE food - labelling laws as part of the Trans-Pacific Partnership agreement given that the United States has identified our GE food - labelling laws as a barrier to trade that it would like to eliminate as part of the negotiations? 
Hon MURRAY McCULLY 
: I repeat to the member that this is the fourth round of these negotiations. It is expected there will be five more such rounds next year. I am sure that from not just the United States but also the other parties to the negotiations we will see many matters floated that they would wish to see progressed in the context of negotiations. It is not helpful for us to speculate about all of them from this distance. All I can say is that the Government’s position on most of these matters is well known and that is the approach that our officials will take into the negotiations. 
Dr Russel Norman 
: I raise a point of order Mr Speaker. I take note of your earlier ruling that the Minister had addressed the question and that was fair enough. On this occasion he did not even mention the specific issue which is GE food - labelling rules at all. 
Mr SPEAKER 
: If the member had listened to the Minister’s answer he would have heard the Minister clearly tell the House that in his view it was not in the public interest to try to conclude a trade negotiation by way of question and answer in this Parliament. The Minister was making it very clear that he did not believe it was in the public interest to give a more specific answer and that is perfectly within order. 
Dr Russel Norman 
: Will he assure New Zealanders that his Government will not weaken Pharmac as part of the Trans-Pacific Partnership agreement given that the United States has identified Pharmac as a barrier to trade that it wants to eliminate as part of the Trans-Pacific Partnership negotiations? 
Hon MURRAY McCULLY 
: The Government’s support for the Pharmac model is well known. Pharmac is perceived to deliver significant benefits to New Zealand taxpayers. Again I remind him that there will be a number of further rounds to these negotiations. Many matters will be floated by other parties and I do not intend to speculate upon them. I simply say that with regard to Pharmac the instructions to the New Zealand officials are very clear. 
Dr Russel Norman 
: Can the Minister confirm that the New Zealand Government has provided a number of position papers to other Governments as part of the Trans-Pacific Partnership negotiations and will he publicly release these position papers to the New Zealand public? 
Hon MURRAY McCULLY 
: I have two responses. Firstly clearly some position papers have been lodged by New Zealand officials. Some people who would be quite well known to him leaked one of them a few days ago for which the Government is entirely grateful because it served to demonstrate that the New Zealand Government and officials are standing up for the interest of New Zealanders in these negotiations. Secondly in relation to the process itself I say it is not a closed process. The Ministry of Foreign Affairs and Trade has called for submissions from New Zealand interests in relation to the Trans-Pacific Partnership. All parties are welcome to make such submissions. The discussions under way in Auckland at the moment are open in the sense that over 100 national and international observers from interest groups are there making their views known. That will continue to be the approach that is taken as we progress this Trans-Pacific Partnership discussion. 
Dr Russel Norman 
: Why will he reveal the New Zealand negotiating position to foreign Governments in the form of these position papers but not reveal New Zealand’s Trans-Pacific Partnership negotiating position to the people of New Zealand? 
Hon MURRAY McCULLY 
: I have just indicated to the member that the approach that New Zealand is taking to these discussions is well known and open. To the extent that he and his colleagues want to engage with officials they are entirely welcome to do so including in Auckland this week. I say to him that as far as the various papers are concerned clearly our negotiators are taking a view about how they can ensure that they serve New Zealand’s interests in the best way in the course of a lengthy negotiation. I am not going to second-guess their tactics. It is entirely a matter for them as to how they sequence the release of information. I simply ask that they achieve the best result for New Zealanders. 
Dr Russel Norman 
: Supplementary question Mr Speaker. 
Mr SPEAKER 
: I believe that the member has had six supplementary questions. My advice is—I apologise to the honourable member but I am afraid that is the case. 
Dr Russel Norman 
: I seek leave to table the submission of Philip Morris International on the Trans-Pacific Partnership to the United States Government. 
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. 
Dr Russel Norman 
: I seek leave to table the submission by the biotech industry on New Zealand’s GE labelling laws which it would like to eliminate. 
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. 
Dr Russel Norman 
: I seek leave to table one of the position papers by the New Zealand Government that were released recently—leaked in fact—and that the Minister referred to. 
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. 
Dr Russel Norman 
: I seek leave to table the US Trade Representative document  
2010 Report on Technical Barriers to Trade 
 which identifies GE labelling as one of the things that the United States wants to eliminate. 
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. 
Ministers—Compliance with  
Cabinet Manual 
2. 
Hon PHIL GOFF (Leader of the Opposition) 
 to the  
Prime Minister 
: Does he believe that all persons who have served as Ministers in his Government have met the requirement of the  
Cabinet Manual  
to behave in a way that upholds and is seen to uphold the highest ethical standards in their ministerial capacity their political capacity and their personal capacity; if so why? 
Rt Hon JOHN KEY (Prime Minister) 
: 
 Yes with the exception of Dr Richard Worth; because they are talented people who are working hard for New Zealand. 
Hon Phil Goff 
: What ethical standards did his Minister Pansy Wong and her husband breach in their publicly funded travel to China in December 2008 which required her resignation? 
Rt Hon JOHN KEY 
: The former Minister has accepted that she made an unplanned and inadvertent mistake and I have accepted that. As we all know from time to time we all make mistakes. 
Hon Phil Goff 
: Is he fully satisfied that the misuse of public funds to travel to China to carry out private commercial business the signing as a Minister of a business agreement in which her husband had financial interests and promoting that business in China on a website were the only breaches of the highest ethical standards by his Minister? 
Rt Hon JOHN KEY 
: I do not accept the second part of the question. The advice I have had is that the signing of a document is not in breach of the  
Cabinet Manual 
. 
Hon Phil Goff 
: Will he in the interests of transparency and the highest ethical standards ask the Auditor-General to investigate any misuse of ministerial travel or authority relating to Pansy Wong given her proven misuse of parliamentary travel funding and given the precedent of his referring Phil Heatley’s case to the Auditor-General; if not why not? 
Rt Hon JOHN KEY 
: I think it is worthy to note a few things. Firstly in the case of Mr Heatley I was the responsible Minister as Minister responsible for Ministerial Services. In the case of Pansy Wong it was a matter for Parliamentary Service and therefore the report was sanctioned by the Speaker. But I say to the member that if he has any information that he feels is relevant he is welcome to refer it to the Auditor-General himself. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. That was an elongated way of refusing to answer a question. The Minister was saying he was not responsible for your expenditure. The question was directly about Ministerial Services expenditure and Pansy Wong’s air travel. 
Mr SPEAKER 
: I hear the point the member is making but he would note that the Prime Minister in the last part of his answer answered it by saying if the member asking the question had any relevant information in respect of that matter then he was welcome to take up the matter with the Auditor-General. I believe that was an answer to the question. 
Hon Phil Goff 
: If the issue is about ministerial travel and misuse of ministerial authority why is it not his responsibility? 
Rt Hon JOHN KEY 
: I have no advice on that matter. 
Hon Phil Goff 
: I raise a point of order Mr Speaker. I ask you to reflect on the Prime Minister’s answer. He said it was not his responsibility. What advice does he need that he cannot answer that question in a straightforward way? 
Mr SPEAKER 
: The Prime Minister has answered the question. Members may not like the answer and the public can judge the answer but I believe it was an answer. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. That could be an answer to any question. Any ignorant Minister could stand up and say “I have not had advice on that matter.” He is— 
Mr SPEAKER 
: Order! 
Hon Trevor Mallard 
: —clearly responsible and he knows it. 
Mr SPEAKER 
: I have heard the member’s point but the public will judge the quality of an answer. It was an answer and members do not have to like it but I cannot insist on a more precise answer to a question exactly like that. I will listen very carefully to the member’s next supplementary question—I am sure he will have one. 
Hon Phil Goff 
: Why will this Prime Minister not accept his responsibility for any misuse of ministerial travel and ministerial authority? 
Rt Hon JOHN KEY 
: Because none has been brought to my attention. 
Hon Phil Goff 
: Is the Prime Minister telling this House that he is not aware of the fact that his Minister misused her authority to expend public funds for a business trip and misused her position to promote a private business interest on a website in China? 
Rt Hon JOHN KEY 
: No I am telling the member that she travelled as a member not as a Minister. 
Hon Phil Goff 
: I raise a point of order Mr Speaker. It is actually a proven fact that— 
Mr SPEAKER 
: The member is now debating the issue; that is not a matter of order. The member will resume his seat. 
Hon Phil Goff 
: Did Pansy Wong sign that document as a Minister of the Crown? 
Rt Hon JOHN KEY 
: No she signed that document saying her occupation was a Minister of the Crown. 
Financial Position Government—Reports 
3. 
CRAIG FOSS (National—Tukituki) 
 to the  
Minister of Finance 
: What reports has he received on the Government’s financial position? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 Yesterday Treasury issued the Crown accounts for the first 4 months of the financial year. They show that the impact of the Canterbury earthquake and lower than expected tax revenue contributed to a higher than forecast $4.4 billion operating deficit in the period. The $1.1 billion lower than forecast tax take for the period was largely the result of lower than expected business profits and lower GST as New Zealanders spend less and save more. This drop in revenue was partially offset by a $440 million lower than forecast Government expenditure showing the merits of Government control over spending and the need for ongoing fiscal discipline. 
Craig Foss 
: What steps is the Government taking to manage its finances responsibly? 
Hon BILL ENGLISH 
: The Government will continue to focus right across the activities of the Crown on reducing low-priority and ineffective spending and on redirecting that spending to front-line services and more worthwhile initiatives. We are also committed to capping future new budget spending at $1.1 billion per year adjusted for inflation. As a result the deficit over the next couple of years might be a bit higher than previously forecast but Government deficits will from this year on begin to shrink. 
Craig Foss 
: What measures will the Government consider next year to ensure agencies operate more efficiently? 
Hon BILL ENGLISH 
: The Government has taken a pretty considered approach to our objective of achieving better public services for fewer resources. Over the last couple of years all Government agencies have had to learn a lot more about how their organisations run what costs drive their budgets and how they will improve their services to the public. Over the next couple of years we would expect to see as a result of that greater understanding and the tools that the Government has given them to use considerable and significant change across most Government agencies as they aim to provide more services for less money. 
Craig Foss 
: What alternative approaches to managing the Government’s finances would lead to bigger budget deficits and more debt? 
Hon BILL ENGLISH 
: I have seen some alternatives: expensive spending promises and a return to bloated bureaucracy tax increases borrowing on world finance markets to invest in world share markets borrowing another $250 million to take GST off fruit and vegetables and not taking dividends from electricity State-owned enterprises. But I am confused about whether these— 
Hon David Cunliffe 
: I raise a point of order Mr Speaker. You have ruled several times that the obviously desperate Minister over there— 
Mr SPEAKER 
: No no. The member will resume his seat. There will be no comment. I am afraid the member just blew his point of order. I think we have probably heard a sufficient answer. 
Hon BILL ENGLISH 
: I had not finished. 
Mr SPEAKER 
: I think the member indicated a range of policy possibilities that would have a negative impact. That is what he was asked and I believe that the House heard a fairly lengthy list. I think that should be the end of that. 
Hon Sir Roger Douglas 
: Does the Minister agree with the policy of Labour’s finance spokesman “David Caygill” that State-owned assets should be partially privatised; if not why not? 
Hon BILL ENGLISH 
: Perhaps one of the reasons the Leader of the Opposition is confused about whether he is working with David Cunliffe or David Caygill is that I think the second David announced the other day that Labour is now interested in partial privatisation. That might explain why Phil Goff called him David Caygill. 
Hon David Cunliffe 
: I raise a point of order Mr Speaker. 
Hon Phil Goff 
: He’s got a bit more hair. 
Mr SPEAKER 
: The House is having a bit of fun but a point of order is being raised by the Hon David Cunliffe. 
Hon David Cunliffe 
: Only to state the obvious—the Minister has ministerial responsibilities for neither David and this one has more hair thank you. 
Mr SPEAKER 
: Now that the House has had a bit of fun we will come back to order. The question asked an opinion and it was highly marginal; I accept that. The answer was in reasonably good humour. 
Hon Sir Roger Douglas 
: Does the Minister support Phil Goff’s pledge to cut national debt at a faster rate than the present Government; if so what steps is he taking to speed up his current slow progress? 
Hon Darren Hughes 
: I raise a point of order Mr Speaker. The Minister is not responsible for any pledge made by any person in this House other than the Minister’s. 
Hon Rodney Hide 
: The question was actually asking the Minister of Finance whether he agreed and supported the pledge. Certainly the Minister has responsibility for whether he supports a policy. 
Mr SPEAKER 
: The member raises an interesting point. The dilemma I have as Speaker is that questions seeking opinions are allowed under the Standing Orders these days. In essence the Hon Sir Roger Douglas has asked the Minister of Finance for his opinion—whether he supports a statement that is claimed to have been made by the Leader of the Opposition. I think the Minister in answering would need to be a little careful not to go too far over the top in expressing his opinion because it is marginal. Opinion questions are allowed but he should be a little careful in answering it. 
Hon BILL ENGLISH 
: I do support Mr Goff’s undertaking but I cannot understand how he is going to do it by spending more money which I understand is the rest of his policy. 
Job Creation—Cycleway 
4. 
Hon ANNETTE KING (Deputy Leader—Labour) 
 to the  
Minister of Tourism 
: How many full-time permanent jobs has his cycleway project created? 
Rt Hon JOHN KEY (Minister of Tourism) 
: 
 I am advised that 215 people have been employed in the construction of the “Great Rides” under the New Zealand Cycle Trail project to date. Officials do not hold the number of hours worked by each individual worker on the 18 separate projects around the country nor do they record the number of volunteer workers. I have no doubt there has been quite a large number of them but they are not included in that figure. 
Hon Annette King 
: How many of the 4000 jobs predicted to arise from the cycleway project are construction jobs only and how many are long-term permanent jobs relating to the operation of the cycleway? 
Rt Hon JOHN KEY 
: The early advice I have had is that there will be about 500 jobs in relation to construction. Of course once the 18 rides around New Zealand are established there will be as we have seen with the Otago Central Rail Trail many hundreds if not thousands of other jobs to support them. 
Mr SPEAKER 
: The Hon Annette King. [ 
Interruption 
] I say to the Labour front bench on this occasion that I have called its deputy leader the Hon Annette King. 
Hon Annette King 
: How many of the over 500 jobs that he promised last week would arise from the cycleway project by the end of 2011 will be jobs for women in light of the growing number of unemployed women in New Zealand which is now at 7.2 percent the highest level since 1998—12 years ago? 
Rt Hon JOHN KEY 
: I do not know the answer to that. But as a woman maybe Annette King could go and work on the cycleway because she is not making much difference to Labour. 
Mr SPEAKER 
: I think that final comment was pretty unhelpful. [ 
Interruption 
] If members expect the Speaker to do something about it they had better remain silent. I ask the Prime Minister to withdraw the last part of that answer. 
Rt Hon JOHN KEY 
: I withdraw. 
Hon Annette King 
: Is he aware that communities around New Zealand have been led to believe by him that the cycleway project will provide hundreds of jobs in places like Te Aroha as shown on television last night which has just lost 160 jobs; and how many real jobs can the people there expect from the cycleway bearing in mind that only two people have been employed so far? 
Rt Hon JOHN KEY 
: I do not have the exact details on that but it is important to understand that those who work on the cycleway are actually employed by the local community which works in partnership with the project. I can tell the member though that the co-funding which has come on top of the $45 million the Government put in is over $30 million. That shows incredible local support. 
Hon Annette King 
: If the cycleway project the one big idea to arrive out of his Job Summit is about creating jobs why did a region like Gisborne which has 7.3 percent unemployment—above the national average—and whose community got behind the project miss out on funding and why was it told that it should not line up for any money until 2012 to 2015? 
Rt Hon JOHN KEY 
: That is a reflection of how successful the project has been. We were absolutely swamped with applications from all around the country and they were actually supported by members on that side of the House. 
Broadband Ultra-fast—Progress 
JONATHAN YOUNG (National—New Plymouth) 
: 
 My question is to the Minister for Communications and Information Technology and asks—[ 
Interruption 
] 
Mr SPEAKER 
: I apologise to the honourable member. I ask both front-benchers please to show some respect to the questioner. 
5. 
JONATHAN YOUNG (National—New Plymouth) 
 to the  
Minister for Communications and Information Technology 
: What progress has been made on the ultra-fast broadband initiative? 
Hon STEVEN JOYCE (Minister for Communications and Information Technology) 
: 
 Today marks a very important milestone for ultra-fast broadband as the Government green-lights the first regions to move from the development phase to the roll-out phase. This phase begins next week with Northpower deploying fibre in Whangarei closely followed by WEL Networks in the central North Island early next year. Ultra-fast broadband is coming to the member’s city of New Plymouth to Whangarei to Hamilton to Cambridge to Te Awamutu to Tauranga to Wanganui to Hawera and to Tokoroa. 
Jonathan Young 
: What products can consumers expect to receive as a result of ultra-fast broadband being deployed in these urban centres? 
Hon STEVEN JOYCE 
: Crown Fibre Holdings is very pleased with the pricing it has secured on behalf of customers. Wholesale household prices will start at $40 or less per month for an entry-level product and $60 per month for the 100-megabit product. There are no connection charges for households. Businesses schools non-governmental organisations and households will all soon be benefiting from new fibre connections bringing them high-quality videoconferencing opportunities for e-health and interactive education and increasing New Zealand’s connectivity as a driver for greater productivity and economic growth. 
Clare Curran 
: Will the Government guarantee that Crown Fibre Holdings will have concluded negotiations and that the Government will have announced agreements with the remaining 25 ultra-fast broadband regions before the next election? 
Hon STEVEN JOYCE 
: That is certainly my expectation but I point out to the member that it is important that when we conduct these commercial negotiations we do not put artificial deadlines on individual negotiations. We could throw as much money as we wanted at them and do the deal tomorrow—I know that is the member’s party’s past history—but actually we are looking for the best value for money for taxpayers. 
Jonathan Young 
: What economic benefits does the Government expect from investing in ultra-fast broadband? 
Hon STEVEN JOYCE 
: This is the start of a nationwide roll-out process that will see 75 percent of New Zealanders able to access the Internet at ultra-fast speeds. The Government is making this very significant investment in ultra-fast broadband because it will have a transformational impact on how we work and interact in the years ahead. It complements other sizable investments we are making in infrastructure like roads rail schools and hospitals. In the short term the projects announced today will employ hundreds of people in the network deployment and operation and in the long term it will give our economy a competitive advantage against the rest of the world. 
Clare Curran 
: Will the Government make public the details of how it arrived at the access prices negotiated by Crown Fibre Holdings with partner companies given that it is about to legislate to provide those companies with a 10-year period free from regulation by the Commerce Commission and given that its ultra-fast broadband programme is being funded by $1.5 billion of New Zealand taxpayers’ money; if not why not? 
Hon STEVEN JOYCE 
: For the member’s benefit I say that we have obviously released the pricing today and all the information that goes with that pricing will be released in due course. But of course we are in the middle of commercial negotiations. I note for the member that these are very very competitive prices and if we are able as I believe we are to lock them in for the next 9 years that is of great benefit to New Zealanders all over the country. 
Hone Harawira 
: Tena koe Mr Speaker. Is he aware that in a bid put forward by Torotoro Waea Partnership an alliance of 24 members including various iwi and industry partners there is an intention to link 1000 marae? Will marae be prioritised in the broadband initiative? 
Hon STEVEN JOYCE 
: I am aware that Torotoro Waea Partnership has submitted a bid to the Ministry of Economic Development for the $300 million Rural Broadband Initiative which is separate from the ultra-fast broadband initiative for urban areas which I have made announcements about today. The Rural Broadband Initiative provides an opportunity for marae to be connected to better broadband services. I am looking forward to seeing the Ministry of Economic Development’s analysis of how bidders meet objectives around connecting marae as well as schools and rural communities. I intend to announce a short list for this initiative before Christmas. Once again this is excellent progress when compared with the previous Government which took about 7 years to get around to doing anything in the broadband space. 
Early Childhood Education Limited-attendance Centres—Police Checks on Carers 
6. 
Hon TREVOR MALLARD (Labour—Hutt South) 
 to the  
Minister of Education 
: Which Ministers if any did she personally consult on the question of removing the requirement for police checks for employees of limited-attendance early childhood centres before she introduced the Education Amendment Bill (No 2)? 
Hon BILL ENGLISH (Deputy Prime Minister) 
 on behalf of the  
Minister of Education 
: The Minister consulted all her colleagues in the normal Cabinet process. 
Hon Trevor Mallard 
: Why is she proposing to remove the primary protection against paedophiles working in gym and shopping mall creches? 
Hon BILL ENGLISH 
: That is not correct. As has been explained in the House by the Minister a number of times the advice is that the Education Act 1989 is not the appropriate place for regulation of an activity that is not related to education. Laws such as the occupational health and safety legislation cover this situation. There is a legitimate argument about the extent to which Parliament should try to legislate for police checks on anyone who is caring for children who are not in the care of their parents which includes everybody from Sunday school teachers through to sports coaches. That is a legitimate argument but the Education Act 1989 is not the place to legislate for it. 
Hon Trevor Mallard 
: Who is the Minister who will be responsible for the limited-attendance centres when the legislation is passed? 
Hon BILL ENGLISH 
: I do not have that information in front of me but I am happy to go and get the answer for the member. 
Hon Trevor Mallard 
: In light of the fact that she will be the Minister responsible when the legislation is passed will she take responsibility for ensuring that paedophiles do not work in gyms and shopping mall creches? 
Hon BILL ENGLISH 
: That responsibility as it should be is primarily the responsibility of those who have responsibility for those workplaces. It is the same responsibility that is given to sports coaches people who run Cubs and people who run swimming lessons and music lessons. I appreciate that this is a legitimate issue about which we may be concerned but Parliament would need to consider pretty carefully how far it went in requiring police checks of anyone who was not a parent and who was looking after a child. 
Hon Trevor Mallard 
: Did she read the advice from the Ministry of Education prior to introducing the Education Amendment Bill (No 2) that warned her that an effect of it was to remove police checks from staff at limited-attendance early childhood centres? 
Hon BILL ENGLISH 
: Yes the Minister did read the advice and she considered that advice in the context of the wider issue that we have been discussing which is that these centres are not providing early childhood education; therefore they will not be regulated in the same way as an early childhood education centre. There is a legitimate issue about the extent to which Parliament would require police checks of any adult who is supervising a child. In this context the occupational safety and health law puts responsibilities on people in charge of those workplaces to ensure that they take all practicable steps to make sure of the safety of the people in them. 
Hon Trevor Mallard 
: Having received and read the advice prior to introducing the bill why did she then tell the House during the first reading of the bill that it was not her intention to remove police checks from staff at limited-attendance early childhood centres? 
Hon BILL ENGLISH 
: I am not sure that the member is representing the Minister’s comment correctly. The Minister was commenting to the effect that the Education Act 1989 was not the place for regulating these types of centres any more than it is the place to write rules for sports coaches in whom many of us parents commit the trust and care of our children for many hours a week as we also do with music teachers and people who run any kind of youth group. The Minister has considered those issues and believes—as I think Parliament would—there is a legitimate issue about how far Parliament goes to require police checks on any adult who is not a parent and who is in charge of children. 
Hon Trevor Mallard 
: I seek leave to table a document that indicates that at the first reading the Minister said that it was not— 
Mr SPEAKER 
: What is this document? 
Hon Trevor Mallard 
: It is my  
Hansard 
. 
Mr SPEAKER 
: We do not do that. 
Social Assistance—Abuse of Process 
7. 
AARON GILMORE (National) 
 to the  
Minister of Revenue 
: What examples can he give of families claiming social assistance for which they are not entitled and what has this Government done to stop this abuse? 
Hon PETER DUNNE (Minister of Revenue) 
: 
 I am aware that 9700 families have been using losses from investment properties to reduce their family income and to increase their Working for Families entitlements and that some families who structure their financial affairs through trusts are also claiming Working for Families tax credits despite earning substantial incomes. For example a family whose trust-owned company earned over $700000 a year in taxable income was able to claim $12000 in Working for Families tax credits. Working for Families tax credits are intended to support families in genuine need not to boost the incomes of wealthy families like those. Therefore the Government will change the law later this week to extend the definition of “income” for Working for Families purposes to prevent such abuses continuing. This will make it fairer for middle-income New Zealand families in particular and for the taxpaying public which foots the bill for these social assistance programmes. 
Aaron Gilmore 
: Is the Minister aware of other examples of families unfairly claiming Working for Families tax credits? 
Hon PETER DUNNE 
: Yes. I am also aware of other examples of families with substantial economic means reducing their family income by placing their investments in their children’s names. I have been informed of a family with parents who earned about $36000 a year but with children who had a combined investment income of nearly $90000 a year and that family claimed $13000 in Working for Families tax credits. Another family’s children earned over $150000 a year in investment income yet that family was still able to claim more than $4000 in Working for Families tax credits. 
Aaron Gilmore 
: What does the Government intend to do to make Working for Families fairer? 
Hon PETER DUNNE 
: I said in my primary answer that legislation will be passed later this week to broaden the definition of “income” for Working for Families. The new income test will include trustee income major fringe benefits and the income of overseas spouses. It will also apply to the parental income test for eligibility for student allowances and the community services card. The principle is simply that parents should not be able to receive different levels of assistance depending on how they structure their affairs to maximum advantage because that is simply inequitable unfair and wrong. 
Economy—Forecasts Compared with Budget 2010 
8. 
Hon DAVID CUNLIFFE (Labour—New Lynn) 
 to the  
Minister of Finance 
: How much lower will the growth forecast be for the year to March 2011 in the Half Year Economic and Fiscal Update compared with the Budget 2010 forecast? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 The member will have to wait and see. We have signalled that growth forecasts are likely to be lower—I think that anyone out in the street could tell us that. However the figures are likely to be better than those of 1988 and 1989 when apparently that member was the Minister of Finance. [ 
Interruption 
] 
Hon David Cunliffe 
: How does he reconcile not John Key’s assertion of the presidency of the United States but John Key’s prediction of an aggressive recovery with the latest economic data showing that corporate tax flows have collapsed a staggering 28 percent below 2010 forecasts? 
Hon BILL ENGLISH 
: The Prime Minister was correct when he was referring to the economy turning round from the bottom of quite a sharp recession which bottomed out in early 2009 and turned round from shrinkage of something like 2 or 3 percent to growth of 2 percent. That was an aggressive turn-round. In respect of company tax as the member will know it is one of the more volatile tax bases that we have. It tends to drop fast in recessions and rise fast in recoveries. On balance other tax revenue from other sources is offsetting those losses to some extent although overall tax revenue is down about a billion dollars on what was forecast. 
Hon David Cunliffe 
: Which of his Government’s initiatives most contributed to the Government deficit growing by almost $2 billion more than he expected in just 6 months since his last Budget and does he in light of that now wish that John Key had got his wish and become leader of the Labour Party? 
Hon BILL ENGLISH 
: Well the Canterbury earthquake was not an initiative of the Government but it has had a significant impact on our books. I am interested that the member might be criticising a deficit being a bit larger than expected when he spent most of the last 2 years telling us we should be spending more to stimulate the economy more. 
Hon David Cunliffe 
: In light of the Minister’s passionate desire for stimulus in how many of the last six quarters has annualised GDP per capita fallen according to Treasury data released this week? 
Hon BILL ENGLISH 
: I cannot answer that question directly but I would not be surprised if in a recession where the population has been growing and the economy has been shrinking there would be some quarters where it was negative. What is very surprising is that through the period 2005 to 2008 when everyone thought we were having a boom under the previous Government per capita real GDP incomes actually dropped which is really quite startling given that they were the best economic conditions in a generation. 
Hon David Cunliffe 
: I raise a point of order Mr Speaker. The Minister has raised an interesting conundrum for us. He seems to have data about the previous Government but not his own. 
Mr SPEAKER 
: That is not a point of order. The Minister answered the question in that he said he did not have detailed information about the successive quarters that the member asked about. I think that is the end of that matter. 
Peseta Sam Lotu-Iiga 
: How will the updated forecast compare with the actual economic performance achieved in the 3 years to 2008? 
Hon BILL ENGLISH 
: Although the updated forecasts may not be as strong as they were at the Budget they were still a lot better than the 3 years to 2008. In the 3 years to 2008 per capita GDP actually declined before the global crisis and while the rest of the world was booming. The first task of this Government has been to stop the rot of a severely unbalanced economy. These forecasts will show at least some progress in people reducing their appetite for debt being careful with their spending increasing their savings and increasing exports. That is the kind of change that the economy needs. 
Pig Farming—Code of Welfare 
9. 
SHANE ARDERN (National—Taranaki - King Country) 
 to the  
Minister of Agriculture 
: What recent actions has the Government taken to improve the welfare of pigs in New Zealand? 
Hon DAVID CARTER (Minister of Agriculture) 
: 
 Last week I was pleased to issue a code of animal welfare for pigs. The new code which is now in effect will limit the use of sow crates from 2012 and will prohibit them completely from 2015 while also placing new limits on the use of farrowing crates. The code confirms New Zealand’s position as a world leader on animal welfare and positions us at the forefront of efforts internationally. 
Shane Ardern 
: What feedback has the Government received on the new code? 
Hon DAVID CARTER 
: The new code has had overwhelmingly positive feedback. My office has received a large amount of correspondence praising the Government for its decision. Even Save Animals from Exploitation has publicly praised it as “surprising” “unprecedented” and a “reason to congratulate a Minister of Agriculture”. This move plus legislation toughening the penalties for animal welfare offences and the substantial increase in funding for animal welfare activities in Budget 2010 is a clear indication of just how important animal welfare is to this Government. 
Health Services—Taihape 
10. 
Hon RUTH DYSON (Labour—Port Hills) 
 to the  
Minister of Health 
: Will he act to prevent closure of health services in Taihape? 
Hon PETER DUNNE (Associate Minister of Health) 
 on behalf of the  
Minister of Health 
: The Minister is keeping in close touch with the Whanganui District Health Board as it works to get the best possible outcomes for Taihape in the light of the decision of the trustees of the Otaihape Health Trust to place the facility into liquidation. As a result of those efforts the district health board has ensured the continuation of general practice primary maternity day services for older people home-based support services radiology specialist out-patient services palliative care the mobile bus surgical service and more for the people of Taihape. 
Hon Ruth Dyson 
: Will he apologise to Donna Wood the clinical coordinator of Otaihape Health who says in her letter to him of 23 November that his statement that Taihape will retain all its services is not true and that Taihape will in fact lose its 24-hour access to PRIME-trained registered nurses its medical beds its in-patient palliative care its respite care and day-care services its maternity services its meals on wheels and its mortuary service? Will he now apologise to Donna and the people of Taihape? 
Hon PETER DUNNE 
: I think it is important to put in context what the Otaihape facility actually is. It is not a public hospital; it is a rest home. Despite significant contributions made by the district health board including writing off some $450000 of back rent and other support in the order of $1 million the facility is simply not sustainable. As I said in the primary answer a range of services in Taihape will be retained and they will be to the benefit of the people of that particular town. 
Hon Ruth Dyson 
: Will he step in to ensure that aged care post-operative and medical beds palliative care and respite-care services will not be lost to the Taihape community as John Key the Prime Minister promised it recently? 
Hon PETER DUNNE 
: The Minister has made it clear to the district health board that he expects the needs of the elderly population of the Taihape area to continue to be met. I am sure the Minister will keep the district health board to its obligations in that regard. 
Hon Ruth Dyson 
: Does he have any concern at all for the residents of Ruanui Hospital particularly for one who turns 94 this Saturday and who is getting an eviction order from the hospital as her birthday present—a situation described by the area’s current member of Parliament Simon Power as “unsettling” but clearly more than unsettling for the 2900 people who have signed a petition asking that these services be retained? 
Hon PETER DUNNE 
: This is always going to be a very stressful and testing time for people involved in that situation. That is fully understood. But the fact of the matter is that the trustees have decided to put the facility into liquidation because despite the fact that there has been a substantial cash injection into it a $450000 debt is still arising from back rent. They have made the call that this particular facility is not sustainable. As the Minister has pointed out he is seeking assurances from the Whanganui District Health Board that a range of services will continue to be provided and that the people will not be adversely affected. 
Hon Ruth Dyson 
: I seek leave to table the letter of 23 November that I referred to in a previous question. It is the letter from Donna Wood to Tony Ryall that points out that his statements just repeated by the acting Minister of Health are entirely wrong. 
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. 
Earthquake Canterbury—Funding for Resurveying 
11. 
AMY ADAMS (National—Selwyn) 
 to the  
Minister for Land Information 
: What steps has Land Information New Zealand taken to help in the rebuilding of Canterbury following the 4 September earthquake? 
Hon MAURICE WILLIAMSON (Minister for Land Information) 
: 
 The Government has just granted $850000 to Land Information New Zealand so its experts can start the important work of resurveying parts of the region damaged by the 4 September earthquake. New Zealand’s survey control system is made up of physical markers known as a geodetic network. The network provides surveyors with accurate information about the area’s topography. The Canterbury earthquake caused significant disturbance to that region’s geodetic control network making it incredibly unreliable. With the resurveying done repair work on important infrastructure such as roads water waste water and sewerage networks can be carried out effectively with the correct information about the land. The surveying work is important because it will not only help local authorities to rebuild key infrastructure but also inform them about changing drainage patterns and flood risks. 
Amy Adams 
: How will this help residents of Canterbury whose land has been damaged by the quake? 
Hon MAURICE WILLIAMSON 
: The resurveying work will help determine property boundaries which will help ease homeowners’ stress and reduce any potential property disputes. The work will help homeowners in their rebuilding as currently some work is being delayed due to a lack of accurate data following the quake. In other words the earth is not where it used to be. 
Roading and Public Transport Projects Auckland—Benefit-cost Ratios 
12. 
Hon DARREN HUGHES (Labour) 
 to the  
Minister of Transport 
: Which project has the higher benefit-cost ratio: the Auckland CBD rail loop or the Puhoi to Wellsford road of national significance? 
Hon STEVEN JOYCE (Minister of Transport) 
: 
 Neither. I refer the member to table E-1 on page 6 of the recently released  
Business Case Auckland CBD Rail Link 
 which states that at an 8 percent discount rate and including wider economic benefits the benefit-cost ratio is 1.1. The benefit-cost ratio calculated in exactly the same way for the Puhoi to Wellsford road of national significance is also 1.1 and it can be found on page 8 of the project’s summary I say to the member. 
Hon Darren Hughes 
: If wider economic benefits and the Treasury discount rate are applied to both projects why does he defend the Puhoi to Wellsford road which gets a benefit-cost ratio of 1.1 on that methodology but say he is sceptical about the benefits of the central business district rail loop which would deliver a benefit-cost ratio over three times that of the Puhoi to Wellsford road? 
Hon STEVEN JOYCE 
: Well that is a difficulty as well because the member refers to a very very new innovative way of calculating benefit-cost ratios which Treasury advised me it had never seen before—the proposed “Net Value Added from CBD Increased Productivity”. Treasury say to me that it does not appear to have any theoretical or evidential underpinning whatsoever. 
Hon Darren Hughes 
: Picking up on that point I ask whether when he questioned the inclusion of the transformational benefits of the central business district rail loop he had consulted his colleagues on the value of such a measurement given that as recently as this question time the Minister for Communications and Information Technology was promoting the broadband policy on the basis of its transformational benefits. 
Hon STEVEN JOYCE 
: Undoubtedly the Minister for Communications and Information Technology whom I respect immensely is well aware of the transformational benefits but even he would not be so ambitious and creative as to suggest a benefit-cost ratio of 3.5 on the grounds that the central business district rail case suggests. 
Hon Darren Hughes 
: Is he aware of any other political figure who is less enthusiastic about Auckland’s central business district rail project than he is; if so who? 
Hon STEVEN JOYCE 
: Possibly the Minister of Finance—and I think he is identifying himself. I say for the member’s benefit that it is quite possible and I am more than willing to accept that the central business district rail project could be a good project for Auckland. But a number of questions need to be answered. For example the business case appears to assume a level of existing infrastructure that does not exist it appears to underestimate the additional infrastructure that is required it does not say how many extra people would use the project compared with the number who would use the electric network without the tunnel it does not tell us how many cars it would take off the road and whether it would reduce congestion and it does not tell us when the Britomart Transport Centre will run out of capacity without it. All those questions are appropriate to be answered before the member starts getting out the Government’s cheque book and waving it around. 
Tabling of Documents 
Pike River Mine West Coast—Tragedy 
LINDSAY TISCH (National—Waikato) 
: 
 I seek leave to table two letters. The first is a letter received from the European Parliament entitled “Pike River: mark of respect by European Parliament”. The second is a letter of response penned by Charles Chauvel chair of the New Zealand - European Union Parliamentary Friendship Group. In seeking leave I note that the mark of respect is the first occasion that the European Parliament has responded to a New Zealand tragedy in this way. 
Mr SPEAKER 
: Leave is sought to table those documents. Is there any objection? There is none. 
Documents by leave laid on the Table of the House. 
Urgent Debates Declined 
Pansy Wong—Outcome of Ministerial Resignation 
Mr SPEAKER 
: I have received a letter from the Hon Darren Hughes seeking to debate under Standing Order 380 the decision of the Prime Minister not to reappoint Pansy Wong as Minister for Ethnic Affairs and Minister of Women’s Affairs. The absence of action on the part of a Minister or the Government is not a particular case of recent occurrence that can be raised under Standing Order 380. Furthermore on 16 November I declined to accept an application for an urgent debate on the resignation of Pansy Wong as a Minister on the grounds that the issues that led to her resignation were not ones to which ministerial responsibility attached. That situation has not changed. The application is therefore declined. 
Electoral (Finance Reform and Advance Voting) Amendment Bill 
Parliamentary Service Amendment Bill 
Second Readings 
Hon SIMON POWER (Minister of Justice) 
: 
 I move  
That the Electoral (Finance Reform and Advance Voting) Amendment Bill and on behalf of the Leader of the House the Parliamentary Service Amendment Bill be now read a second time 
. I thank the Electoral Legislation Committee for its careful consideration of these bills. The committee had representatives from every parliamentary party and wherever possible sought cross-party consensus to promote an electoral finance regime that is as fair and transparent as possible to all groups and individuals participating in the electoral process. The other valuable contribution made by the committee as reflected in its recommendations was the way in which it balanced those goals with recognition of the practical realities of campaigning. 
The committee received 44 submissions from academics individuals organisations and political parties of which the majority generally supported the bill. Submitters generally supported the intent of the bill as introduced to avoid retrospective application of the regulated period. However some expressed concern that the Government of the day could gain a strategic advantage by knowing in advance when the regulated period could apply. The committee instead recommended that the default day for the regulated period should be amended to 2 years 9 months from the previous polling day. That will provide all parties and candidates with a backstop date when they need to take greater care with their activities. 
The committee also accepted suggestions from submitters to clarify the exclusions from the definition of “election advertisement” to make it clear that it does not include editorial information broadcasts of parliamentary proceedings and personal political views published on the Internet for which no payment is made or received. The committee also clarified the definition of “advertising expenses” by excluding non-commercial hoarding frameworks and defining the previous exclusion for travel. 
Another amended definition arose from the parallel work by the committee on the Parliamentary Service Amendment Bill—namely that the definition of “election advertisement” in the Electoral Finance Amendment Bill should exclude the publication of MPs’ contact information that is funded by the Parliamentary Service. The committee recommended changes to further strengthen transparency and accountability on election advertising including stricter conditions on promoter statements and prohibiting overseas persons and overseas organisations from becoming registered promoters. 
The majority of the committee also recommended an expenditure cap for third-party promoters of $300000. The Government recognises the strength of feeling from submitters regarding the influence that wealth potentially may have on election outcomes. Yet the cap is at a level that allows meaningful participation in the electoral process assuring freedom of expression. This level is set at more than twice the level under the previous Electoral Finance Act and applies to a regulated period that is one-quarter of the length. 
Third-party promoters who spend more than $100000 on election advertising will also need to file expense returns. For spending by candidates the committee recommended increasing the limit during the regulated period to $25000 for a general election and to $50000 for a by-election. It also recommended that the party expenditure limit be increased to reflect movement in the CPI and indeed to $25000 for the “contested electorate” component. 
In respect of donations the committee recommended increasing the disclosure threshold to $1500 for candidate donations and to $15000 for political party donations. Political parties will file a specific return with the Electoral Commission for donations over $30000. For smaller donations both the number of donations and the total amount of party donations for each so-called band will be disclosed. To reduce compliance costs the committee has replaced the associated entities regime in the bill with anti-collusion provisions. Submitters supported the advance voting provisions in the bill so no changes were recommended. 
The Parliamentary Service Amendment Bill proposes a permanent meaning of the term “funding entitlements for parliamentary purposes” that explicitly excludes funding for electioneering. The extended definition of “electioneering” clarifies that during the regulated period Parliamentary Service funding cannot be used for an election advertisement or for referendum advertising in a Government-initiated referendum. To align with proposals in the Electoral (Finance Reform and Advance Voting) Amendment Bill the committee recommended adding a definition of “publish”. The committee recognised that the commencement of the regulated period affects whether an advertisement can be funded so it recommended amendments to the apportionment provision for election advertisements and referendum advertising. The committee also recommended provision for the recovery of payments made by the Parliamentary Service which it later decided to be outside of the entitlements that can be claimed. 
The committee’s recommendations for Parliamentary Service funding provide clear guidance for members of Parliament and ensure that Parliamentary Service funding is not used for electioneering. These bills are the product of a long incremental and deliberate process of consultation with the public and political parties. I reiterate something I said at the beginning of this process many many months ago—that only through agreement from a broad cross-section of the political spectrum can we secure an enduring electoral finance framework. Not everyone will agree with every detail. What is important is the long-term nature of the legislative framework. 
I am grateful to all parties across the House for their willingness to embrace this opportunity and to discuss these matters in good faith. Ultimately these bills will enhance the public’s confidence in the integrity of our elections by balancing fairness with freedom of expression. I commend these bills to the House. 
Hon LIANNE DALZIEL (Labour—Christchurch East) 
: 
 The Labour Party will be supporting the second readings of the Electoral (Finance Reform and Advance Voting) Amendment Bill and the Parliamentary Service Amendment Bill. We believe that we have reached a workable compromise with the Government over electoral finance laws and the relevant Parliamentary Service funding rules. 
I will make just a quick comment about the Parliamentary Service rules. I am pleased that we have managed to achieve alignment between the two bills so that there can be no question of taxpayer funds being used for any form of electioneering. I think we have clarified very carefully the rules on what sitting members of Parliament can advertise in terms of the location of their out-of-Parliament offices electorate offices and those sorts of things. I think we have achieved a good result. 
In terms of the electoral finance laws there is a side issue that I will mention just to get it out of the way. I know that there will be campaign managers from one end of the country to the other who will be so pleased that they will no longer have to account for wood used to put up hoardings because finally we have been able to resolve that issue. I know that that is a triumph for democracy. It is a triumph for the volunteers who do so much to help us. Having to justify to them why a piece of wood or some hoarding material still has a photograph of Mary Batchelor on it for example in my electorate has been somewhat disturbing. That problem is going and I know that everyone will be pleased to see it go. 
There is an issue in this package that does not form part of Labour Party policy and I am referring to the disclosure thresholds but we will support them as part of a package in order to achieve the degree of consensus that the Minister has committed to finding. I would like to congratulate him and to put it on the record of House that he has attempted to do that. There has to be compromise on both sides in order to achieve that—disclosure thresholds on the one hand and spending limits on third parties on the other. We will be monitoring the disclosure rules very carefully just to see how they work in practice. However I will say that one of the things that will make it easier for us to do so is the requirement to disclose the number of donations in each band as will occur under this legislation. That will enable us to assess whether there is a shift to donations to act as an avoidance mechanism of the disclosure rules. 
Critical to Labour’s support for the electoral finance legislation was the ability to have spending limits imposed on third parties to avoid what I have always described as the Americanisation of our political system. There was real debate on this issue although a lot of the commentary in the submissions came into the territory of the Electoral Referendum Bill. I think the reason for that was that under the Electoral Referendum Bill there will be access to television advertising and there is no access to television advertising for third parties in election campaigns. 
When we get into the question of television advertising of course the unfettered ability to spend any amount of money on television advertising is of significant concern. I think that is what drove a lot of the submissions to focus more on the Electoral Referendum Bill on that subject rather than on this legislation. However there was commentary from submitters on the question and the majority of people fell on the side of there needing to be some constraint on third-party spending. The amount we agreed at the select committee was $300000 which represents the bottom end of the range for a medium-level nationwide ad campaign in the retail sector. 
I thought it would be worthwhile talking about why we have our position on spending limits. I will go back to the 1986 Royal Commission on the Electoral System. I thought the commission’s summing up of spending limits was very useful. The commission stated: “It is neither fair nor conducive to an informed electorate if wide discrepancies in access to resources mean some parties or groups are denied the chance to communicate their views effectively. Nor is it fair if some in the community use their relative wealth to exercise disproportionate influence … it is important that the electorate is fully informed both about significant sources of political finance and about the uses to which it is put.” 
I think that sums it up very well. Whether or not there is actual influence—and as submitters said the influence could be either way—some people might be switched off by the degree of negative advertising that is promoted by a third party. But I think the royal commission was saying that it was equally concerned about—not the fact of but the perception of—undue influence or disproportionate influence being attracted to those who had more money to spend than other members of the community. 
The legislation as introduced provided that any group or person who was not a candidate or party could publish an election advertisement as long as it contained a promoter’s statement which included a name and address and as long as the total advertising expenses did not exceed more than $12000. If those expenses totalled more than $12000 they would have to register. That was all the legislation provided for. 
I want to now talk about why we wanted this change and I want us to go back to 2005. In 2005 for the first time major campaigns were waged by parties and their supporters to do one of three things: to avoid the regulated period to remain outside the existing advertising rules or to hide their true identity. All three aspects were features of the 2005 election campaign. 
Labour has been more than happy to support reform but we were concerned that changes would simply legalise the harm that we were trying to remedy with our attempt to change the electoral finance laws back in 2008. I do not believe that the right to freedom of speech equates to the right to pay for advertising. That is not freedom of speech; that is freedom of paid advertising. It is paid speech not free speech. I think it is a fair distinction to make between the two. It should not govern who has a say on real matters of constitutional importance. Of course people should be able to speak out freely but I do not see that that matches what is being proposed here. 
It would be worthwhile for everyone with an interest in transparent democracy to read or reread a book called  
The Hollow Men: A study in the politics of deception 
 and reflect on who sits in the House now and was identified as playing a role in a coordinated advertising campaign scripted by an organisation called Crosby/Textor. The advice given was to stop attacking the then Prime Minister the Rt Hon Helen Clark on her weaknesses—few that those may have been—but to attack her on her strengths. A billboard campaign that used a distorted photo of the former Prime Minister positioning her against the smiling face of one Don Brash was designed to do just that—and it almost worked. “Iwi/Kiwi” was one of the more infamous messages from those billboards. So when someone tells me that a lack of spending limits is about free speech forgive me for my cynicism. 
Then we had the disgraceful actions of the Exclusive Brethren which not only sought to discredit the Government of the day and the Green Party in targeted brochures that failed to disclose the true identity of its promoters but also was deliberate in its attempt to do so. The Exclusive Brethren had been to the Electoral Commission with its pro - Don Brash brochures which had his pictures on them and on finding that the brochures would have to be authorised by the National Party and that they would count against National’s campaign spending limits it designed those utterly misleading attack brochures against the Government of the day and the Green Party picking the issues of defence health and drug law reform. The Exclusive Brethren has done that not only in New Zealand but also in Australia and other parts of the world. 
Dr Russel Norman 
: Steven Joyce I believe. 
Hon LIANNE DALZIEL 
: Well we can name Steven Joyce; I will accept the interjection because that was exactly who I was referring to earlier in terms of the design of the billboards that were the set-up for what was to happen later. I think that we should never forget why this legislation is necessary and why we are happy to support it now that there are spending limits on those third parties. 
AMY ADAMS (National—Selwyn) 
: 
 It is a great pleasure to stand here and take a call on the second readings of the Electoral (Finance Reform and Advance Voting) Amendment Bill and the Parliamentary Service Amendment Bill. I will start my contribution by thanking the Minister of Justice for the way he has brought the Electoral (Finance Reform and Advance Voting) Amendment Bill to the House which is in sharp contrast to the previous iteration of electoral finance reform in this House. There has been a long deliberative consultative process and an overarching desire to ensure that the solution we come to as a Parliament will be an enduring one. That is worthy of this House’s support and I certainly want to congratulate the Minister on it. 
I will also take a moment to thank my fellow members of the Electoral Legislation Committee. In Parliament we tend to get fairly political on many occasions but this committee approached this matter in that same sense of needing to reach a sensible and enduring solution. 
I think all parties that were represented on that committee—and that was every party in the House—worked very constructively and collaboratively and they can take some credit for the state of the legislation that we have now brought back to Parliament. 
Finally in this introduction I congratulate and thank the officials and the committee staff because we were not always an easy committee to work with. The officials were certainly excellent in the support they gave the committee. The state of the bill now as it is before this House is in large part due to their work. 
There is a lot in this bill and there is a lot that one could make a contribution on and I am mindful of not taking up too much time. The points that I want to talk on very briefly in this contribution—and there will obviously be more time in the Committee stage to go into these points—are firstly the regulated period; secondly the electoral spending issue; and thirdly the issue of spending caps. 
The regulated period is one we spent quite a bit of time discussing and the tension we were balancing there was the need to ensure that no one in this House was faced with being in a regulated period without realising it—that need to avoid retrospectivity was certainly one of the driving factors for our committee—and equally our wish to get as close as possible to a situation where the regulated period would be around 3 months without acting to curtail the Prime Minister’s discretion in calling election dates. It was certainly my view that that sort of change to how elections are called and when and discretion around that is a major constitutional change that is best left for another forum. In this instance we did not want the regulated period to wag the dog in terms of how elections are called but we certainly wanted to come to a situation where more often than not the regulated period was around the 3-month period that we were very comfortable with. The default trigger of 2 years and 9 months from the previous election and the other triggers that are built into the legislation are a pretty good compromise in terms of the issues we were dealing with. 
I will touch briefly on this issue of election spending. Here again it is a matter of balance of making sure candidates for Parliament can adequately communicate with their voters. Coming from a large rural electorate myself I know very well that in an electorate of that size it is very difficult to get out and communicate who one is and what one stands for while staying within the spending cap as it is. Certainly we were mindful of the need to make sure that the limit allowed a meaningful discussion with voters while obviously recognising that we did not want it to be a contest in which the candidate with the biggest pockets won. We have raised the limit up to $25000 as the previous speakers have indicated. Arguably it could have gone higher but that is where we got to with the support of the House. 
As Ms Dalziel commented in her speech we have at long last got rid of the vexatious issue of second-hand timber. I know that many campaign committees around the country will be very pleased not to have to count nails any more and worry about whether they can reuse last time’s timber and how that will be costed. It was a nonsense and a waste of everyone’s time and it is certainly very good to be rid of that. 
The other point that is worth making in that context is that those figures along with the spending cap figures will now be CPI-linked thereby ensuring that we do not once more end up in a situation where we have a figure frozen in time which gets less and less relevant as time goes on. 
Very briefly to finish I will touch on the issue of spending caps. We have heard from the Minister and previous speakers that this is a compromise position and that all parties feel we have a workable and enduring solution. Our starting position obviously was not to have a spending cap. My own view—and I am quite happy to go on record saying it—is that the limit could have been and potentially should have been higher. But we had to balance the need and the entitlement of every New Zealander to meaningfully engage in the election process with ensuring we did not get a situation in which big-money players could come in. I do not think we have really seen that in New Zealand to date but we certainly have seen it in America and other jurisdictions. Therefore we ensured that there was some sort of limit across the board. Every other player in election spending is limited: candidates are limited in what they can spend parties are limited in what they can spend and in that sense it is only right in my mind that anyone who wants to play in that park should also have some controls on them. 
Finally I will touch on the Parliamentary Service Amendment Bill the second reading of which we are also debating. I just reflect what the Minister said about the importance of ensuring there is now absolutely no basis on which taxpayer funds can be used for electioneering activities as happened with the pledge card. That can never be allowed to happen again and with these changes it will not happen. 
I commend the bills to the House. 
Hon PETE HODGSON (Labour—Dunedin North) 
: 
 I will just start off my speech on the Electoral (Finance Reform and Advance Voting) Amendment Bill and the Parliamentary Service Amendment Bill where the previous speaker Amy Adams more or less left off. When one runs for office in this country whether one is the general secretary of a party or a candidate in a seat one is limited by the amount that one can spend in the period leading up to the election. Those limits are all set down in law and they are all pretty well policed. If anyone breaks those limits they lose their seat or they go to jail or both. That is to say electioneering is a highly regulated activity. But if one is not standing in a general plebiscite or if one is not the general secretary of a party involved in a general plebiscite until now—or at least until 2008—there were no limits on what a third party could do. That of course was dumb and it was rendered dumb not in the first instance by the Exclusive Brethren in the 2005 election but in earlier times. I think Michael Laws might have been the first one I came across. I think he got the SPCA to endorse him or something equally unlikely. That might have been the 1990 Hawke’s Bay election. 
Hon Member 
: Ha ha! Ironic. 
Hon PETE HODGSON 
: It would be ironic if that were the case. It certainly involved Michael Laws I recall but it was not a big issue. So we sort of hectored and badgered and grumped and harrumphed through the 1990s on both sides of the House. National members would say the Engineering Printing and Manufacturing Union had too much say in the Labour Party campaigns and on the debate went argy-bargy back and forth. But it was all small beer.  
Then in 2005 it became large beer and Lianne Dalziel laid that out in her contribution. I do not intend to go back over those most interesting of times; there is a whole book to be read on it if one wishes to. It gave rise to legislation in 2008 which was not agreed to in a bipartisan way about the limit on third parties about the limit on non-participants in an election and about people who were wanting to sway an election but who were not standing for an election.  
This legislation in 2010 for the first time represents a bipartisan—not a multipartisan but a bipartisan—approach to the idea of third-party limits: limits on Federated Farmers if we want to isolate them or on the Cooks and Stewards Union. Do we still have one of those? I cannot be sure but we used to dislike those unionists so maybe we could still dislike them if they exist. Whomever we dislike—the people we want to hold up as the ones we want to constrain for our own partisan reasons—we now have an ability to do that constraining.  
The level of constraint is the point of compromise. It is a point too far I suspect for the Greens and too far in the other direction I suspect for the ACT Party. But it is a point that has been reached between Labour and National. I am not sure of the position of the Progressives the Maori Party or United Future but certainly the bulk of the House is saying that $300000 will do.  
Let me make a prediction: the amount will not stay there. It will go up or it will go down or it will have constraints put on it in some other way because we are doing this in a bipartisan way for the first time. Like every other aspect of electoral law it will take a while to bed in and we will find ourselves fretting about the mistakes that we have made. Indeed I can name and describe the loopholes in the legislation now but it does not matter. The point is that this House is about to take I think the step of saying that the majority of people amongst us are of the view that third parties like those who are standing for election should also be constrained in how much they can say.  
Lianne Dalziel spoke about the difference between paid speech and free speech and I would like to say that I have never understood the position of say the  
New Zealand Herald 
. I do not mean to isolate it and I do not mean to attack it in any way. I have just never understood why even when the $300000 compromise was reached the  
New Zealand Herald  
took a position not dissimilar to the ACT Party which was that that was mildly or moderately—or even more than moderately—outrageous.  
I do not get that; I genuinely do not get it. I am sure that the  
New Zealand Herald  
and other papers that have a similar view are not acting in self-interest and are not trying to maximise their advertising revenue in a plebiscite. I am sure the  
New Zealand Herald 
’s view is based on principle rather than on revenue but I do not understand its principle. I do not understand why our country would be better if it were the case that someone who was rich could go and materially influence the plebiscite by expending a bunch of money. I do not understand why that would make New Zealand a better place. The  
New Zealand Herald  
seems to think that it would and I just do not get that.  
I certainly do not think that this legislation introduces a constraint on free speech. Free speech is being able to get on one’s soapbox to get one’s letter to the editor printed in the aforementioned  
New Zealand Herald 
 to arrange a march down Queen Street and be covered by the entire media of the nation or whatever it might be—that is free speech. Free speech in my view is not buying out all of the advertising space of this or that medium of the country in the last week or two leading up to an election. In respect of that aspect I just do not understand where the  
New Zealand Herald  
is coming from.  
There are a couple of other things I want to say about electoral law in New Zealand. The first thing is that the report of the Royal Commission on the Electoral System  
Towards a Better Democracy 
 was a cracker. It is now 24 years old and we have picked up only half of it and we have got on top of only some of its wisdom. The main thing we did pick up was the bit that said we should have MMP and we all know that in legislation that is coming in front of the House later today we will be putting that question back to a referendum. But 25 years ago the royal commission said we should do it and then about 17 years ago we did it. We have had MMP elections ever since so that change came from that royal commission report.  
Lots of other things have not come about yet and one of them is the idea of third-party limits on spending. The commission got there long before the Exclusive Brethren did—20 years before. The commission said: “Hang on a minute folks. It’s dumb to constrain this candidate but not to constrain this non-candidate.” It said we should be careful about that. It started to do that thinking back then.  
Another thing the commission suggested which has not come to pass but I think will come to pass was that there should be some measurable degree of State funding of political parties according to this that or the other formula. The commission offered up some formulae and suggested that if we calculated it at $2 a vote—or whatever it was I have forgotten the details now—we would know what to expect each political party would have. On top of that of course political parties would want to fund-raise and who would not? But I think that issue is something that needs to be examined.  
We have always been too scared to implement State funding as it is called. My personal view is that our democracy would be better off for it. In Australia where they do have it they say that it is not high enough. Well that is a different debate. We do not have it here at all. Of course we do have State funding in the sense that we have some television time allocated to us as the ACT Party is quick to point out whenever these debates arise but we do not have it in a way that is transparent. I think transparency is the name of the game here. 
The last thing I will say before I sit down is that understandably the National Party—and I make no criticism here—said that it would not bind its Prime Minister to a specific date for an election. No Prime Minister in his or her right mind would do that and I understand that because I have been around Prime Ministers on the other side who have been disinclined to give that power away. I think it will happen one day that we will move to a set date. Of course we would need to have an ability to move away from that set date if ever the confidence of the House was lost and that is reasonable but I do think those changes are forthcoming. With those remarks I look forward to the passage of this legislation. 
METIRIA TUREI (Co-Leader—Green) 
: 
 I am pleased to speak on the Electoral (Finance Reform and Advance Voting) Amendment Bill and to say that the Green Party will be supporting this legislation and its companion bill the Parliamentary Service Amendment Bill. Later in the afternoon we will also confirm our support for the Electoral Referendum Bill. All three of those bills were dealt with by the Electoral Legislation Committee at the same time. 
The Greens have been campaigning for a very long time—and have held it as our policy for a very long time—on the need for New Zealand politics to be honest and clean. A number of different issues arise in terms of honest and clean politics but one of the means by which those politics happen is through electoral finance. It is quite weird actually—just on a personal note—but having debated both electoral finance legislation and foreshore legislation this year it makes me wonder if years spent in Parliament are just like one long day. Having gone through the original process of looking at the Electoral Finance Act in 2007 and then having reviewed both that Act and the changes to it this time I think that this bill does make some advances which is great. The bill has kept some of the significant changes that the Greens fought for in the earlier version particularly in relation to donations and to penalties for illegal and corrupt practices and we are very pleased about that. 
In addition this bill has also introduced spending caps which was a very important issue for us and one on which our support for this bill depended. People have talked today already about the Exclusive Brethren and the issues that arose in 2005 and there is no doubt that those issues were a clear example of the fact that we needed a transparent process so that the public knew who was doing what in the campaign what was being spent and who were the players the public could identify so that the veracity of their claims could be judged effectively. In that case the veracity was seriously lacking. 
The public also need to know the people who are making themselves political players in order to hold them to account. Of course political parties and candidates are clearly in the game and are making themselves political players. They are constrained in the way that they can use money to present their position—and rightly so. But it is also critical that others who want to be players in the political game have their engagement subjected to similar rules. There is nothing inherently anti-democratic about that approach. So one of the processes firstly honestly identifies who a player is—which is a provision of the registration process in the previous and now in this current legislation—and secondly makes that player like other political players subject to financial constraints in order to make sure that money is not the dominant influence in the public’s mind as to who they would prefer to see in their House of Representatives. 
On spending caps the argument that somehow people will misuse the genuine and right values of free speech and the right of citizens to be engaged in the political process used particularly by the ACT Party and others like it as a means to defend wealth and the abuse of wealth and its influence in the political process is quite frankly revolting. It is kind of yucky to hear those arguments being made. None the less given that free speech is so important it is important that if those arguments are to be made they are heard—and we certainly heard them. The majority of the submitters the public and certainly members of this House agree that it is quite right that there is to be a set of rules for engagement in this process particularly a set of rules for money. New Zealand does not have billion-dollar advertising in this industry because it does not work but the idea that spending money on advertising will not influence the election campaign is patently ridiculous despite that being one of the arguments used by political parties in this House. We are very very pleased to see that National has agreed to the cap. I must say that the cap in this legislation is smaller than the one the Green Party proposed in our submission to this bill so we are very pleased to see that. 
The select committee made a number of other recommendations. One of those we disagree with very strongly and that was about the donation disclosure thresholds. Most of the disclosure regime that the Greens put in place last time has been kept but the disclosure threshold has been changed by National. It has increased the threshold at which a party has to disclose who has given it a political donation from $1000 to $1500 for a candidate donation and from $10000 to $15000 for a donation to the party. We are extremely concerned about this increase in the disclosure threshold for donations. It means that it will be effectively easier for political parties to hide from the public where they get their money from. We have talked about the importance of a financial cap or constraint on players but it is also critical for the public to know who is funding political campaigns for political parties—parties that will exercise extraordinary economic power once they are represented in this House. 
This is part of the process of the right of citizens to be informed and engaged in the democratic process. One of those processes clearly is that the public should know who political parties are getting their money from so the public can assess again whether the interests of parties really do lie with the public or with those who are funding them. It is perfectly reasonable for the public to know that but National for some reason has decided that the public should be shut out from knowing it. National wants to keep the public ignorant about who is funding it and by enacting legislation arguably wants to keep the public ignorant about others. National wants to increase the threshold so that the public are denied their right to know further who is funding their political parties. 
In the Greens’ view the current level of $10000 is too high; it was already too high. Our position is that the threshold should be at $1000 and that political parties should disclose on a regular basis to the public those who are giving them donations of $1000 or more. There is nothing wrong with the public knowing more about what is happening with their political parties and about the power that political parties exercise once they are elected into Parliament. 
This set of values—a clean system an honest system a transparent system and a principled system—are the values that the Green Party takes to discussions on politics on the way our electoral system is functioning and indeed on MPs’ expenses. Today we have seen that the Law Commission has come out in agreement that those are the principles that should be applied to MPs’ expenses and it agrees with the Green Party that there should be an independent body that sets MPs’ expenses. We now see that both John Key and Phil Goff have followed the Green Party and agreed that such a body should be independently setting MPs’ expenses because of the importance for the public of having confidence in a system where transparency and clarity on the use of public money in terms of MPs’ expenses and in the sense of election funding is made more apparent to them. So we are very pleased that finally the two old parties have followed the Greens and that we have led that change once again with MPs’ expenses. We are very pleased to see that there has been some change in this legislation but as long as the disclosure threshold remains too high we will continually oppose the political forces that want to shut the public out from that information because it is not right to do that. The public have a right to know who is funding their political parties but this legislation—very unfortunately and for no good reason—will shut the public out from that view. 
We look forward to the Committee stage and we invite support from all other political parties for our Supplementary Order Paper. It will fix this problem and restore a sense of the values of transparency and clarity to this legislation and it will reduce the disclosure threshold to $1000 for political parties and candidates as is only right in a modern 21st century democracy such as ours. Thank you. 
HONE HARAWIRA (Maori Party—Te Tai Tokerau) 
: 
 I note that when the police reviewed election spending a few years ago they decided that there was not a case to look into with the Maori Party because we did not spend anything near the cap. We simply do not have enough money so we rely heavily on face to face getting out and about and talking to people. We do not even think about the big spends that the two major parties campaign with. Like the Greens we are happy to see that some limits have been agreed to primarily for the two major parties—and ACT of course. Those are the only parties that can afford to spend the kind of money that people think of in terms of major political campaign spending. 
I am grateful that limits have been proposed. We are grateful that there is greater transparency. We are grateful that there is greater clarification around election advertising and we will be supporting this legislation. Thank you very much. 
CHESTER BORROWS (National—Whanganui) 
: 
 I rise in support obviously of the Electoral (Finance Reform and Advance Voting) Amendment Bill and the Parliamentary Service Amendment Bill which have been a long time coming. Those of us who were part of the previous term of Parliament can recall the fractious nature of the select committee debates on electoral finance and advanced voting. As a part-time member of the Electoral Legislation Committee I am very pleased to have witnessed a much more cordial relationship across the parties. Maybe it was because those events were not so recent so nerves were not so wrought. 
Suffice it to say that every party in this House has a little bit of baggage. Transparency and openness tend to render the scars visually no matter who gets up and says it first whether it be the Green Party the Labour Party the National Party the ACT Party or any other party for that instance. I am pleased to see that we have an accord and that people are looking forwards rather than backwards. 
I look forward to the smooth transition of these bills through the House. I thank those members of the select committee for the way that they engaged in an honest and open way. I congratulate the chair Amy Adams who did a fantastic job of steering it through. Thank you. 
CHRIS HIPKINS (Labour—Rimutaka) 
: 
 Government members who have spoken on the Electoral (Finance Reform and Advance Voting) Amendment Bill and the Parliamentary Service Amendment Bill have made much of the importance of bipartisan consensus on and support for electoral reform legislation. The point I make to them is simply that that goes both ways. It requires a willingness to engage in discussion and to compromise on both sides. 
That was not there when the Electoral Finance Act came through the House before the last election. The National Party thought the opportunity to play politics with the issue was too good to pass up. National members were given plenty of opportunities in the lead-up to the Electoral Finance Act’s passage to engage in discussion with the then Government and they chose not to. They chose not to because they would rather play politics. 
Do members know how we know they chose to play politics with it? Because one of the bills we are about to pass through its second reading now the Parliamentary Service Amendment Bill and which we are currently debating as part of this package of bills contains exactly the same provisions that the National Party railed against when they were put forward by the previous Labour Government. What did those members call that legislation? Gerry Brownlee called it “Mugabe-style” legislation—“Mugabe-style” legislation that those members are now passing another bill to continue. It was “Mugabe-style” legislation when a Labour Government passed it; it is all sweetness and light and bipartisan consensus now that a National Government is passing exactly the same provisions back into law. 
Gerry Brownlee called it utterly disgraceful legislation as well. Nick Smith said it was a rort. He said that never in his 17 years had he seen a bill that would bring this Parliament into so much disrepute. That was what he said about the bill that we are currently debating and will pass through the House this afternoon. That is what National members said when they were in Opposition. They are now getting on their high horse and saying that we have to have consensus and bipartisan support for electoral reform legislation. I tell them that it goes both ways. They have to be willing to compromise and to engage in the discussion and they were not before the last election. 
They are not this time round either in some respects. We have a bill on the Order Paper under the name of Paul Quinn that makes significant changes to electoral law in this country and it does not have bipartisan consensus and support yet the Government is using its majority to push it through anyway. It appears that the Government’s willingness to engage in electoral reform only where there is bipartisan consensus has limits. Paul Quinn’s bill appears to be exempt from that. I say that the National Party’s rhetoric on that appears to be just a little bit hollow. 
I rewind the clock back to where this all started back to 2004-05 when we saw the Exclusive Brethren spend a huge amount of money to run a third-party parallel campaign that was unregulated uncontrolled and unmonitored in support of the National Party. The Exclusive Brethren ran that campaign and senior National Party figures including some who are currently in this administration were not entirely truthful in what they knew about the Exclusive Brethren’s campaign. They knew about it but when asked about it they said they did not. That was not truthful. They should be held to account for that because they did not tell the public the full truth about what they knew about the Exclusive Brethren campaign. 
One of the reasons I think the provisions in this bill on parallel third-party campaigns are important is that I would hate to see New Zealand going down the track of the United States where there are significant third-party campaigns. In fact in some cases the third-party campaigns are bigger than the candidate and party campaigns themselves. We are talking about multimillion-dollar campaigns. In a lot of cases those campaigns are simply dirty. They are smear campaigns. 
I spent some time in 2004 in the United States just before George W Bush’s re-election. I was absolutely disgusted with the third-party campaign that was run against the then Democratic presidential candidate John Kerry. The Swift Boat Veterans for Truth ran a campaign that was not based on truth. There was no truth whatsoever in a lot of the allegations made. The only thing that campaign had behind it was an awful lot of money—a huge amount of money. The Swift Boat Veterans for Truth smeared John Kerry’s character with a massive advertising campaign that the Democratic Party was unable to counter. 
I would be very disappointed if we opened the door for that type of campaigning in New Zealand. I think we need to be very clear that if someone is going to do any form of significant political campaigning in this country it should be open. People should be able to know who is behind it. If we see expensive ads in the paper or on the TV or anything else like that the New Zealand public is entitled to know who is paying for them and what their agenda is. 
At least this legislation allows that to happen. It says that if someone is going to spend more than $300000 on a third-party campaign there will be rules around it. 
Amy Adams 
: No it doesn’t; it says you can’t spend more than $300000. Read the bill. 
CHRIS HIPKINS 
: I apologise; third-party campaigns cannot spend more than $300000. The bill also has other requirements on the disclosure of political donations. I think those things are really important. 
The donation thresholds are higher than I would like to see. At the moment it is $1000 for donations to a candidate and $10000 for donations to a political party. In my view that is high enough but as I said at the beginning compromise and bipartisan consensus on electoral reform requires compromise on both sides. The Labour Party has chosen to compromise on those donation thresholds in order to ensure that we can have an arrangement governing the third-party campaigns and preventing an independent party from spending huge amounts of money. I think that is a really important compromise and I support it. 
I congratulate the Labour members on the Electoral Legislation Committee in particular on the work they have put into this legislation. I know that it has been approached with a lot of diligence by committee members including by some of the National members on the committee I am sure. I think that— 
Amy Adams 
: Don’t go out of your way Chris. 
CHRIS HIPKINS 
: Oh well I try not to. I know that the legislation has been approached with a lot of diligence by members on both sides and I am really pleased about that. 
Another provision in this bill that I am very supportive of is the provision requiring political parties to disclose the donations they receive in bands in respect of the size of donations. That will allow the public and the watchdogs to monitor whether this system is being pushed to its limit or rorted in a way that was not intended. If the public sees a whole heap of donations coming through that are just below the disclosure thresholds they might want to ask some questions about that. That is another really important change that has been reached in this legislation; it will increase the overall transparency of the political donation system and that is important. 
The public of New Zealand are entitled to know when they go to vote and when they receive information trying to encourage them in the way that they cast that vote who is behind that information and who is funding it. We do not want to see big money in New Zealand politics buying influence and buying access to power. 
Let us be honest about this. Not many people donate significant amounts to political parties without wanting to get something out of it. They could simply want access to people in authority. They may have a particular agenda and therefore donate moneys to the parties that have policies that are consistent with that agenda. That is OK providing it is transparent because then the public can make their own judgments about whether they think somebody is trying to buy influence by giving donations to a political party. Those transparency requirements are important. 
One reason that the Labour Party is willing to set aside its disagreements over one or two of the issues including the donations disclosure thresholds is so that we can get the bipartisan support required to pass this legislation through the House. Overall the Labour Party will be voting in favour of both these bills: the “Mugabe-style legislation” as Gerry Brownlee called it that the National Government is now trying to pass in the Parliamentary Service Amendment Bill and the Electoral (Finance Reform and Advance Voting) Amendment Bill. We will be supporting both of those bills further. Thank you. 
HEKIA PARATA (National) 
: 
 Tena koe. Otira tena tatou huri noa i to tatou Whare. I am pleased to stand and take a short call on this legislation. I have been a somewhat peripatetic member of the Electoral Legislation Committee having had other calls on my time that were particularly pertinent to this legislation. All of us in this House who are involved in electoral activity get to know about the very sharp end of how any legislation applies on the ground. 
The National-led Government’s electoral finance proposals have now been subject to four rounds of consultation which began in April last year and it has been a commitment of this Government to have a consensual approach. So it is somewhat of a pity that Chris Hipkins the member who just spoke and who has just left the House chose to introduce an unnecessary element of rancour I thought into the otherwise multiparty consensual approach that has characterised the consideration of these bills in the select committee. As someone who has recently had the experience of participating in a by-election I am absolutely delighted at the progress that this legislation represents because many little details can slip up even the most committed campaigner inadvertently. I think that this legislation has gone a considerable way towards ensuring that there is both clarity and common sense in the way that we consider and apply electoral legislation. 
In that regard I join in commending the Minister of Justice for taking the approach which he has taken from the outset of being committed to ensuring that we get consensus on this electoral legislation because it needs to be durable it needs to have integrity and it needs to have commitment from all the members of this House. I think the Minister’s conviction in this regard has been important in the approach to and carriage of this legislation. I also commend all the members of the select committee who participated in the consideration of this legislation. I too enjoyed the contribution of experienced members such as the deputy chair Lianne Dalziel and also of the very long-term member of Parliament Pete Hodgson who provided his particular rapier-like insights during a number of the discussions. I commend the members of the select committee for their approach to this legislation. 
In closing I particularly commend the chair of the select committee. My colleague Amy Adams approached this legislation with the same rigorous and analytical approach that she brings to all her tasks. She was very even-handed in the way that she assigned time to the consideration of the legislation by members of the select committee and also in terms of the hearings that we held around the country and of the submitters who had the opportunity to put their views in writing on it. She maintained a very even temper as well which was sometimes required in the consideration of these issues. I applaud her navigation of this complex area. In that regard I compliment Amy Adams the select committee and the Minister. I commend this bill to the House. Kia ora tatou. 
Hon DARREN HUGHES (Labour) 
: 
 I rise to support the second reading of the Electoral (Finance Reform and Advance Voting) Amendment Bill and also the Parliamentary Service Amendment Bill which we are considering cognately together this afternoon. Before I begin my remarks I acknowledge the speaker whom I have followed Hekia Parata—tomorrow to be legally honourable—and I wish her all the best for her— 
Amy Adams 
: She’s always been honourable. 
Hon DARREN HUGHES 
: That was part of the joke I say to Mrs Adams. That was a subtlety lost on her I can see. But obviously being a member of the Electoral Legislation Committee has been very useful for Hekia Parata because it has enabled her to rise to much higher status with her new ministerial elevation so I offer my congratulations to her as she takes up her new duties. 
Having praised her now let me move to immediately criticise a couple of things she said. It is true there has been a high degree of cooperation and working together on this legislation but when she criticised my colleague for pointing out some of the inconsistencies that have occurred as though that was somehow unfair of him I think that was pushing the barrow out just a little too far. It cannot be the case that when National is in Opposition it can say anything it likes about matters to do with electoral law and then when it is in Government everyone else should just play nice. People should just play nice and play along with the rules of the Government of the day and pointing out any previous positions that have been held is just not cricket was the impression I got from the member as she spoke. It is true that although we ought to— 
Hon Christopher Finlayson 
: Darren the Australians lost by the way. 
Hon DARREN HUGHES 
: Well that was beyond doubt. If the Attorney-General had to check whether the Australians had lost the cricket to the English then it just shows how out of touch that man is. This has been clear for days and days and days but he has done a Google check to find out that this has happened. He must have a function out in the community tonight where he has to talk small talk with people and he thought he must check whatever happened in that cricket. He has taken the chance to do that and I congratulate him on it. 
Obviously matters of electoral law are ones where we would much prefer to see things settled. I recall my colleague Pete Hodgson the member for Dunedin North pointing out when he was speaking that it was 24 years—almost as long as John Carter’s career—since the royal commission reported on the electoral system and these are debates that have been going on for quite some time. When there has been a period of settled agreement across Parliament I think that is where things have worked well. Whatever the merits or otherwise of the Electoral Finance Act when the then Opposition made an overt decision not to cooperate or comply with that law in order to attempt to derail that law of course that became difficult just as this law would become unworkable if the Opposition of the day decided that we were going to mount a campaign about making it as unworkable as possible. There has to be a degree of acceptance and cooperation and a willingness to submit to not only the letter of the law but also the policy prescriptions in it. 
In that spirit I do join in the cacophony of praise to the Hon Simon Power that we are hearing. That has been a feature of the debate. We all have to line up take our turn and praise Simon Power. He pretends he is not listening to these things but I know they are being noted down. There will be another forum or another occasion not too far from now where I am sure these matters will be discussed in much greater detail and I look forward to that occasion. But in all seriousness Mr Power has set out with the overt strategy of getting the agreement being prepared to give and take on some things being prepared to signal things on which the Government was not prepared to move but accepting there was difference and allowing the Opposition the space to do the same thing. Mr Hipkins made the point that in respect of the disclosure for anonymous donations at electoral levels the current rate of $1000 is fine. This bill moves it to $1500 which was part of a genuine negotiation between all sides of politics and I think that has been most useful. 
Also just to continue with the theme of people who have played a role the Justice and Electoral Committee worked very very well. Amy Adams the chair of the committee deserves congratulations on that work because she was as a new member able to chair the committee on a very challenging topic. She did so very competently fairly and in a way I think that if submitters went away saying that they had not been listened to it would be an unfair conclusion to draw. A genuine attempt was made to hear submitters. I can confirm that she read every submission because she had the first two questions to every submitter. It was absolutely clear that the chair had been very diligent in her approach and we appreciated that as we did having the chance to make our point. It is important to reflect on the goodwill at the committee and to be able to place that on the record of the House. 
The area that the select committee reported back to the House as being different from the first reading was primarily in relation to third-party caps—the limit of expenditure for third parties to participate in the democratic process either in parliamentary elections or for those involved in referendums. I do think this issue is very important. Mr Hodgson made the observation that freedom of speech is a very important thing for every citizen to be able to enjoy. It is the basic principle of democracy. But it cannot be exaggerated into a position where people can purchase unlimited speech to the detriment of other political players and of people who want to have their voices heard fairly and equally because as we know our system says that every vote is equal. That is demonstrated in the way in which ballots are counted. So it makes sense that there be a common-sense regime for the amount of money that can be spent. Having just watched the mid-term elections in the United States I saw that there was a phenomenal amount of money spent. That amount of money would make the eyes water of even the National Party’s trustees of the Waitemata Trust. A large amount of money was spent even by the candidates who were not elected. The GOP nominee in the gubernatorial race in California spent over US$150 million on her campaign. Whether she received the endorsement of the Minister of Justice is unclear; I will need to check that in her electoral returns at the appropriate point. But there was a lot of money spent—to lose. Mind you as we have seen in this place sometimes if someone loses an election that person celebrates as if they won it; but that is a debate for another day. 
Hon Christopher Finlayson 
: That’s certainly my approach in Rongotai. 
Hon DARREN HUGHES 
: Speaking of defeated candidates for Mana I hear the Attorney-General pipe up. Defeated in Mana and Rongotai—who knows where he is off to next. He is the Richard Prebble of electoral defeat. That said we look forward to where he may well be heading. Maybe he could stand in one of the Maori seats. He enjoys inflicting electoral defeat on himself so much that he could be a candidate for Te Tai Tonga or Te Tai Hauauru. 
Hon Christopher Finlayson 
: Watch Rongotai next year. 
Hon DARREN HUGHES 
: The Attorney-General says Rongotai is the seat to watch. I am sure the deputy leader of the Labour Party Mrs King will have a reasonably firm view on that matter. 
In respect of the caps I make the point that it is important to make sure a fair and understandable amount of money can be spent on these things. That is why we spend a lot of time talking about the equivalent of a retail campaign. I do not think the cap should be so large as to allow the kind of mass retail marketing that say Briscoes might allow. Voters would be absolutely sick and tired if they were subjected as much publicity as that for a constant amount of their time. So putting the caps in is important. 
The regulated period was an area on which there was a lot of disagreement and that is one of those things where there is political difference depending on which side of the House someone happens to be occupying. But I think that in the longer term the only way around that is to have a debate in New Zealand about the length of the parliamentary term. That issue was last considered by the country in 1990 with the referendum on a 4-year term. An issue also debated was whether a fixed date would be a more sensible way of handling our parliamentary arrangements. Our move to proportional representation 14 years ago has not resulted in an unstable Government; there has been government where different people have had different views on the policy agenda but we have stable government under MMP. Those who had previously argued against fixed terms had thought that our proportional system might not lend itself well to such an arrangement but I believe it would and that is something we should come back to. 
Finally I will mention in the remaining minute that we are passing the second reading of the Parliamentary Service Amendment Bill. The bill seeks to amend the definition of “funding entitlements for parliamentary purposes” which was designed by Dr Michael Cullen and which was roundly ridiculed by the Opposition at the time. Mr Brownlee picked it up as Leader of the House last year. We were determined to get not an interim but a long-term definition of “funding entitlements for parliamentary purposes” and this bill does it. It is very very important that we have now resolved the issue about the use of parliamentary funding for legitimate constituency and parliamentary political party work and also the issue of not being able to use taxpayer resources to campaign either positively for one’s own party or against another. So we have the third-party situation sorted and we hope we never see the Exclusive Brethren situation ever again in New Zealand. We have a sensible regime around the referendum and now we have the Parliamentary Service funding worked out. I think those are all worthwhile reasons to support the second reading. 
Hon JOHN BOSCAWEN (Minister of Consumer Affairs) 
: 
 The ACT Party will be opposing and voting against this legislation. I will focus most of my speech on the issue of third-party expenditure limits and the restrictions that are being placed on the rights of ordinary New Zealanders to speak out and be involved in the election campaign. 
Before I do that I reiterate some of the comments that have been made in this House this afternoon. I congratulate Amy Adams the chair of the Justice and Electoral Committee on doing a very good job. I say that very genuinely to Amy. I also acknowledge the contribution of Pete Hodgson. He said things in this House this afternoon that I totally disagree with. However I have to say that having been involved in that committee over 2 or 3 months I got to know Mr Hodgson better and I thought that the comments and contributions from the other side of the room so to speak were very positive in a general sense. I also acknowledge the officials. 
One person spoke this afternoon who was not involved in the sittings of the committee and that person was Mr Hipkins. I found his contribution this afternoon disappointing because he ridiculed National for its efforts initially to reach a multipartisan approach and then to reach a bipartisan approach. There are huge advantages if we can get a bipartisan or multipartisan approach. Amy Adams this afternoon talked about the overarching desire to reach consensus. Yes a consensus was reached but I ask at what cost. 
Mr Hipkins drew the comparison between this legislation and the previous Labour Government’s Electoral Finance Bill. I remind Mr Hipkins of some of the provisions of that bill when it was first introduced. It put a requirement on any New Zealander who wanted to speak out and criticise any party or any person seeking election to first of all go to a justice of the peace and sign a certificate if they wanted to spend so much as a single dollar. Labour’s contribution to this debate was to put a proposal out to the people of New Zealand that required every single person or third party who wanted to participate to go along first of all to a justice of the peace to seek approval to spend so much as a single dollar. Treating the people of New Zealand with such utter contempt drew widespread protest throughout the country. 
I go back to the submission from the Human Rights Commission on that bill. It said: “A human rights approach to democratic government requires genuine participation. Genuine participation in turn requires an informed electorate. By limiting freedom of expression and creating a complex regulatory framework in the way it does the Electoral Finance Bill”—that is Labour’s Electoral Finance Bill—“unduly limits the rights of all New Zealanders to participate in the electoral process”. The commission concluded by saying: “The bill in its current form represents a dramatic assault on two fundamental human rights that New Zealanders cherish freedom of expression and the right of informed citizens to participate in the election process.” 
The legislation before the House this afternoon is a lot better than Labour’s bill. I acknowledge that it is significantly better. Labour sought to eventually put restrictions on third parties and individuals to limit them to spending no more than $120000 in the year of the election. It is New Zealand’s electoral history that elections generally fall towards the end of the year in September October or November. Labour sought to put restrictions on third parties by allowing them to spend no more than $120000 for essentially the full year. 
One may think that $120000 is a lot of money. One may even think that the National Party’s so-called bipartisan proposal to allow third parties to spend $300000 is generous particularly when that $300000 is limited to only the last 3 months before the election but let me put that $300000 in context. What do we as politicians get to spend? To use Lianne Dalziel’s terms what do we get to spend on paid speech? Lianne Dalziel would criticise people’s going out and spending their own money as if it were dirty money—as if it were dirty for people to fund-raise and be involved in the political process in the way that the Human Rights Commission says they should be encouraged to do. 
What do we get to spend? The rules for what a party and its candidates can spend are laid out in this legislation. Essentially they prescribe a formula that will enable the two major parties in this Parliament National and Labour and their candidates to spend more than $5 million. That is right: under this legislation they will be entitled to spend more than $5 million each. What do these two parties say to people in New Zealand? They say that they are allowed to spend $300000 which is one-sixteenth of what they can spend. They do not want their fellow New Zealanders to criticise them on the election trail or to put up arguments against their policies; they want to limit their rights. Lianne Dalziel had the audacity to stand up in Parliament today and say that she does not want to restrict people’s right to speak out—they are entitled to speak out—but they cannot spend their own money or if they do spend their own money they need to be restricted to spending less than one-sixteenth of what the major parties spend. 
Lianne Dalziel I and the other politicians in this Parliament this afternoon have a very special privilege. We can speak to the people in the gallery and to the people at home watching television. Who knows how many people are involved in listening to this debate right now? There could be a few hundred or there could be a few thousand. What about the rights of ordinary New Zealanders? We have rights and privileges that no other New Zealanders have. We have the right to be in this debating chamber and to go around the press gallery. 
I look at a press release put out this afternoon by Family First which is a so-called third-party organisation criticising this bill. Does Family First have the right to come into this House? Does Family First have the right to speak to the people watching television right now? No it does not. It relies on the media to pick up press releases such as this one or it relies on the financial contributions of its members to fund the advertisements to go in the newspapers which it seems the Labour Party and also sadly the National Party would choose to deny them. 
I pay tribute to Mr Bob McCroskie of Family First who joined me on the campaign trail against Labour’s Electoral Finance Bill. I will do something in this Chamber right now that he cannot do. I will read part of his press release. I will read the story that the politicians in this Parliament would seek to suppress. What does he say? He says: “The politicians are effectively restricting non-political groups to $300000 while they can spend millions of dollars and get free television advertising as well … This is not a triumph for democracy. It is an act of arrogance and paranoia on behalf of the politicians and shows utter contempt for voters who may be members or supporters of non-political groups who wish to highlight certain issues during an … election year.” 
What does a political party get to spend? The formula prescribes that we can each spend $1 million—in fact $1030000 under this legislation. For every candidate we put up we can spend a further $25000. For a party like the Labour Party or the National Party which would stand a full slate of 70 candidates that is a further $1.75 million. If we add that together it comes to $2.75 million. On top of that each of those two major political parties will get $1 million each in broadcasting—that comes to $3.75 million—and on top of that the individual candidates who stand for each of those parties can spend a further $1.75 million in total. All up that comes to $5.5 million. What are the politicians in this House prepared to allow ordinary New Zealanders to spend? They will allow them $300000. As Mr McCroskie says Family First will not spend anything like that but this Parliament is restricting the rights of New Zealanders to participate. 
Mr Hodgson cannot understand why the  
New Zealand Herald  
would stand up for the rights of ordinary New Zealanders to speak out in an election year. I pay tribute to the  
New Zealand Herald 
. I have here a scrapbook of clippings under the heading “Democracy under attack” from the months when the Labour Party tried to impose its will on New Zealand. It is a tribute to the  
New Zealand Herald  
and the other members of the media who stood up for the right of free speech. It is a pity that the politicians in this Parliament are not prepared to do the same. The ACT Party will oppose this bill. Thank you. 
CHRIS TREMAIN (National—Napier) 
: 
 I rise as a member of the Electoral Legislation Committee which considered this legislation to round out the debate with a brief speech. I start by thanking the committee members who were involved and the Minister for bringing the legislation to the House. 
I make the point that in November 2008 the new Opposition leader Phil Goff said it had been a mistake to ram through the controversial Electoral Finance Act without widespread support and Labour would like to take part in a review. He then went on to acknowledge publicly that the Labour Party had made mistakes. So I was somewhat disappointed when I came into the House 15 or 20 minutes ago to hear Chris Hipkins on his high horse talking about National ramming through Mugabe-style legislation when in November 2008 his leader had clearly acknowledged that Labour had rammed through electoral legislation without widespread support. 
What we see in the House today is totally the opposite of what Mr Hipkins— 
Hon Simon Power 
: A 2-year process. 
CHRIS TREMAIN 
: Exactly. As the Minister says we have been through a 2-year process that has sought cross-party support. I accept that there are a few members in the Chamber such as those in the ACT Party who are not fully in agreement with where we have got to but to say we do not have majority support is anything but the truth. Through the Minister Amy Adams and members of the Labour Party we have reached a consensus here on what I believe is a fair and transparent process. 
What I also like about the process is that we brought into it some of the realities of electioneering. Often when we put these debates in front of officials they have not been out there and had to deal with raising finance. They have not had to deal with putting up election hoardings; they have not had to deal with all the issues that go with running an election campaign. So I think that having people like Darren Hughes me and Pete Hodgson who have been through a couple of elections brought a sense of reality to the process. Without labouring the point I refer to things like the cost of hoardings. We brought some common sense to that. In relation to the level of third-party promotion yes it is not at the level that ACT would like to see but there were submitters who thought that we should have only a $25000 level. That would not even pay for a couple of advertisements in the  
New Zealand Herald 
. How could that constitute the limit for a national campaign? 
There are things like the reduction of compliance around associated entities which is where I will finish my debate. It had been proposed that people who were making a donation would have to declare as donors all the associated entities companies or trusts that they were involved with. Quite frankly that was nonsense; it would have stopped donations in their track. People who had a number of different entities would have said they would not go down the track of declaring every associated entity just so that they could make a donation to a party. So I think we have reached some common sense there. I am really pleased to see that we have reached a transparent process that is common sense and will provide settled law going forward. Thank you. 
A party vote was called for on the question  
That the amendments to the Electoral (Finance Reform and Advance Voting) Amendment Bill recommended by the Electoral Legislation Committee by majority be agreed to. 
Ayes 115 
New Zealand National 58; New Zealand Labour 41; Green Party 9; Maori Party 5; Progressive 1; United Future 1. 
Noes 5 
ACT New Zealand 5. 
Question agreed to. 
A party vote was called for on the question  
That the Electoral (Finance Reform and Advance Voting) Amendment Bill be now read a second time. 
Ayes 115 
New Zealand National 58; New Zealand Labour 41; Green Party 9; Maori Party 5; Progressive 1; United Future 1. 
Noes 5 
ACT New Zealand 5. 
Bill read a second time. 
Parliamentary Service Amendment Bill read a second time. 
Electoral Referendum Bill 
Second Reading 
Hon SIMON POWER (Minister of Justice) 
: 
 I move  
That the Electoral Referendum Bill be now read a second time 
. This Government committed to provide New Zealanders with an opportunity to express their opinion on the MMP voting system. This bill provides for a referendum on the voting system to be held in conjunction with the 2011 general election as the first step in a two-stage process designed to maximise voter participation and provide a clear decision on the type of voting system that New Zealanders want. The 2011 referendum will ask voters whether they wish to keep MMP or change to another voting system. If 50 percent or more voters opt to keep MMP the bill provides that the Electoral Commission must review MMP and report on whether any changes are necessary or for that matter desirable. If the majority of voters opt to change to another voting system the Government has committed to hold a second referendum in 2014 that will ask voters to choose between MMP and the preferred alternative system. This approach follows a similar process to that taken in 1992 and 1993 when MMP was introduced. 
Once again I commend the all-party Electoral Legislation Committee—in particular its chair Amy Adams but all members—for its careful consideration of this bill. I am advised that the committee received well over a thousand submissions on the bill reflecting the high level of interest on this issue from New Zealanders. The majority of submitters expressed support for the process set out in the bill although suggesting some amendments. Some submitters considered that the voting paper could be made clearer by simplifying the language. The committee has proposed a number of changes in response to submissions. The committee also recommended that the alternative voting systems in Part B of the voting paper be listed in alphabetical order rather than being determined by lot. In response to submitter concerns the committee has described the supplementary member voting system in schedule 2 using the key features recommended by the Royal Commission on the Electoral System in 1986. The description now provides that each voter would have two votes and that of the 120 seats in Parliament 90 would be electorate seats and 30 would be party list seats. 
Some submitters suggested that a review of MMP should take place regardless of the referendum outcome. The committee concluded by majority that the bill should retain the requirement for the review to take place only if 50 percent or more electors vote to keep MMP. This approach will provide a clearer indication of voters’ preferences with regard to the broad type of voting system that they favour. Voters who prefer MMP in principle but wish to see it modified would vote to retain MMP. Those voters who disagree with aspects of MMP would need to decide whether their concerns were fundamental enough to make them want to vote for another voting system in the referendum. 
Many submitters sought expenditure limits on referendum advertising. The committee by majority recommended an expenditure limit of $300000 during the regulated period. The committee has also recommended a number of technical changes to align the referendum advertising provisions in the bill with the election advertising regulation proposed in the Electoral (Finance Reform and Advance Voting) Amendment Bill. By considering these bills together the committee has been able to deliver a coherent package of electoral reform. 
I once again thank all political parties for the constructive way that they have engaged on this bill as well as the one considered by the House in the second reading just previously. This is a critical electoral and constitutional issue which in my view should require the type of approach taken by Parliament in this instance. I am confident that the committee’s recommendations support the Government’s objective of providing for a clear neutral and unbiased referendum process. I commend this bill to the House. 
Hon PETE HODGSON (Labour—Dunedin North) 
: 
 I cannot remember when the House last debated a referendum bill. I wonder whether anyone can. I think it might have been Winston Peters’ compulsory super bill may it not have been? That would have been about 10 or 11 years ago. The result went down rather badly. But none the less it is not so often we debate them. Certainly in the 1992 to 1993 period we had two referenda as we are about to with this round. So it is not so often but here we are. I suppose I should say at the outset some nice things because I forgot to say them the first time around. I endorse the remarks made by a number of people about the approach taken by the Minister of Justice from the outset of trying to get as wide a consensus as he reasonably could. He has been consistent in that regard. He has been somewhat successful. He has a really wide level of agreement—or perhaps it is best said that a number of parties are now equally unhappy about the result whatever it is. 
It is also the case that those parties that are a little more on the edge—the ACT Party on one edge and the Green Party on the other to give a couple of examples—would probably say that the outcome was not what they would choose but the process was not too bad. So that is the first thing to say. 
It is probably also fair for me to acknowledge that the Electoral Legislation Committee has worked very well. It has been chaired very well by a very able chair in the form of Amy Adams who I noted made some nice remarks about officials and I would like to do that too. That gets the nice stuff out of the way and it is important to say that so I thought I would say it first. 
Hon Simon Power 
: Here we go! 
Hon PETE HODGSON 
: Here we go! Why the hell we need a referendum in the first place I do not know. I really do not know where that promise came from. I do not remember it being part of the National Party manifesto. I could have been— 
Hon Simon Power 
: It definitely was. 
Hon PETE HODGSON 
: Then a good question is why it was part of the National Party manifesto because there was no groundswell amongst the public for this. There was a groundswell amongst the public for something else and that was for amendments to the MMP system. They said: “Could we please keep the MMP system but tweak it a little bit.” Of course the problem with that mood in society is that society—under a little bit of interrogation—can never quite agree on what the tweaks are which is why we will need a review process. The review process is provided for in this legislation but it is provided for only if a whole lot of people really like MMP. It is saying: “If a whole lot of people really like MMP we’re going to review it; and if a whole lot of people do not we’re not going to review it.” That is one way of putting up the sort of residual difference or one way of explaining the residual difference between the Government’s position essentially and the Labour Party’s position essentially on the issue of the review of MMP. 
I am not standing in the next election so I should probably not announce Labour Party policy on the hoof but in the event of there being a Labour Government formed a year from now and in the event of the majority of New Zealanders deciding that they would like to try another system instead of MMP I would be surprised if the incoming Labour Government did not say: “OK we can do that but we will give you a new shinier MMP system to measure against this other variety that you think you might like to test it against.” I would think that would be the likely outcome. 
I do not want to get into too much argy-bargy with Mr John Boscawen and I do acknowledge his analysis of $300000 versus $5.5 million. I really think we need to add GST a few times to get to that $5.5 million but none the less he showed us how to do it. He took every possible limit and maxed them out and he got there. That is fair enough; that is a debating technique. It is not I think a realistic comparison but he does make a point that $300000 is a limit that in his view is too low. Fair enough but he lost me on his first sentence. He said that this legislation—which like the first one has a $300000 limit—is not good for the ordinary person. But I say that it is because the ordinary person is precisely the person who does not have $300000 to fritter around; that is just precisely the person who does not have $300000 to fritter around. It is the extraordinary person or the extra-committed person who does. Actually there is also the possibility of people clubbing together and I say good on them if they want to. 
He went on to say that his friend Mr McCroskie thinks that the limit is far far too low; not that Mr McCroskie wants to go anywhere near that limit himself but he thinks it is far too low for someone else. Well who is this someone else and why do they want to spend more than $300000 perhaps as much as $5 million trying to influence the plebiscite which is in essence a contest of political ideas? 
I think that probably the reverse also holds true: that in the referendum it is actually the politicians who need to stand back. If politicians are asked they should say where they are casting their vote and why. It is something I intend to do if I am asked. Perhaps I will be asked but I do not intend to spend a lot of time raffling a lot of chooks in order to raise a lot of money to promote a certain outcome for a referendum. In case anyone is wondering I will be casting my vote for a continuation of MMP. The main reason is that I think this is a decision that should be taken by the voters. It is their decision how they are going to elect us and that might sound a bit cute for some people but I hold it to be true. That is why one of the provisions in this bill is a real cracker—that is if I spend a dollar on this referendum advertising it will count against my political limits as well as my referendum limits. So both of my limits will be activated by that dollar spend. Both of them will be 1 dollar less by my expending 1 dollar. 
Amy Adams 
: But you’re not standing. 
Hon PETE HODGSON 
: Have I got that right madam chair? 
Amy Adams 
: You have except you’re not standing so you won’t have an electoral limit. 
Hon PETE HODGSON 
: I am not standing and the chair of the committee—the now-extinct committee—is perfectly correct. I am not standing so she and I are both extinct in a sense. On the other hand the idea that politicians can be a little bit limited by the fact that it will be counted against them twice is kind of nice. It happened almost by accident in the select committee to be honest because life became terribly technical at that point. I certainly will not bore the House with the details around that. 
I think this is unusual legislation. When the Minister introduced it I remember he was a bit disingenuous. I remember the Minister saying that this was the most transparent referendum legislation this House has ever seen—and he was right. In this legislation as introduced there is a requirement to register which had never existed before. What he was doing was trying to defend with his sophistry the absence of third-party limits. But we spotted that; so did the rest of New Zealand. The Government has behaved well—even graciously or sensibly or something like that—and from now on referenda will have reasonable limits. I for one look forward to that. 
AMY ADAMS (National—Selwyn) 
: 
 I am very pleased to take a call in the House this afternoon on the second reading of the Electoral Referendum Bill. As the previous speaker did I will refer to some comments I made in respect of the Electoral (Finance Reform and Advance Voting) Amendment Bill which the House has just finished debating. I spoke about the way that the Minister approached the process the way that the Electoral Legislation Committee worked and the help that we had from the officials on that legislation. I simply repeat my comments in this context because they apply to this bill too. 
From the Government’s perspective the starting point for this referendum is very much the view that I hear being expressed around New Zealand. I accept that I am just one person and the feedback to me is anecdotal and far from scientific but it is that most New Zealanders thought there would be a second referendum on MMP. Most New Zealanders as I hear them talking to me understood that when they elected to adopt MMP back in 1993—not by an overwhelming majority one would have to say—there would be a second chance to come back and say what they thought about it. What they had not done was to look at the asterisk and read the small print at the bottom of the page which stated that it would happen if Parliament agreed. That is where those people got lost in some of the technical detail. Of course Parliament looked at this issue in 2001 and by a very very narrow majority at that time it decided not have a second referendum because it thought that it was a bit too soon to do so. Even then Parliament did not say a referendum was not necessary; it just said 2001 was a bit too soon. 
It has always been National’s policy and it was made very clear at the last election that New Zealand should have a second referendum despite the technical wording that went in at first. Quite apart from anything else if New Zealand does once more signal that it wants MMP as its voting system then that will legitimise MMP and put to bed the festering unease about whether we should have ever had a second say on it. 
I find one thing slightly concerning and I will get it off my chest nice and early in the piece. There seems to be a bit of a mood from the pro-MMP lobby to say we have the electoral system that we want so there should not be any more debate on it now—that having got MMP we should shut the debate down. I do not think that is right. If we are firm in the view that MMP has worked well for New Zealand—and I would be the first to say it has done some good things—then we should not be afraid to put it back to New Zealanders and say: “OK this is your chance. You’ve had this system now since 1996. How is it going? What do you think of it? Should we endorse it?”. It has always been the view of the National Party and this bill is the driver of that that we should ensure that New Zealand has that chance and that the process is fair and easy to understand. 
For that reason the select committee spent a lot of time on the ballot paper which is a schedule of this bill to ensure that the language was as simple and as plain as it could be. The committee took some expert advice on that. We spent a lot of time on looking at the way that the systems were described—their names; their order on the ballot paper—in order to do everything we could to ensure that there was no perception of bias either for or against any particular system. As the chair of that committee it was certainly my view—and I think everyone on the committee shared it—that we needed to ensure that all the voting systems were put up in an unbiased way so that the public could have their say without us sticking in our fiddle as to which system it should be. For my part I have been pretty careful not to take a stand on any of the systems because as Mr Hodgson quite rightly said that is not for us politicians to do. This is a referendum and it is for the people of New Zealand. Our job in passing this legislation is to ensure as the Minister said in his opening contribution that the process is clear neutral and unambiguous. 
I will just comment on the issue of the timing of the referendum. One way that this process is different of course from the 1992-93 process is that the decision being made by the Government in this bill is that both referendums if there are two will be held in conjunction with general elections. We had some discussion with submitters on that issue during the select committee process. Of course what we get from combining the referendum with a general election is a far higher level of engagement and voter turn-out and that is absolutely something to be desired. I guess the counter to that and what we have to weigh up is whether the referendum messages—and there are some reasonably detailed messages about the differences between the systems—will somehow get lost in the clutter of a general election campaign. We spent a bit of time discussing that and I think that is certainly a fair argument. But my strong view and where the committee ended up is that the importance of having a high level of voter engagement if the result of this referendum is to have validity is absolutely fundamental. So we have the process whereby both referendums if there are two will be held in conjunction with general elections and I think that is important. 
This leads me to the issues of the public education campaign which will be a key component of the process. Coincidentally enough following on from the previous legislation we will have a public education campaign and around $5 million has been allocated for that. Against that we now have spending limits of $300000 on independent campaigners in this process. I think the relativity between those amounts should not go without comment. It is important that the public information is out there and dominates the debate. Certainly everyone is entitled to have a say in that. Let us just make the point that the limit is $300000 per campaigner and there could be any number of campaigners on both sides of this debate. As I said in my first contribution arguably the limits should have been higher—that is where I would have started from—but that is where the committee has come to on a consensus basis. 
The other thing I want to comment on which cuts across both bills—I did not make the point in the previous debate but I will make it here briefly—is that we were very concerned about the compliance cost of these limits. We did not want to make the regime overly onerous so we will require detailed returns to be filed only when campaigners are spending over $100000 and are really playing in the big end of town. People handing out a few leaflets and the like do not have to go through the expense of filing detailed returns. We have not required an automatic auditing provision either because we all know how onerous and expensive audits can be. Instead we have given the Electoral Commission the power to require an audit if it believes on reasonable grounds that there is merit in doing that. I think that is a good balance between ensuring that the system is robust and not imposing cost for the sake of cost. 
I would very much like to talk about a number of other matters. The bill provides for a very very interesting process and I look forward to seeing how it rolls out during the next year. However we will have more time for debate during the Committee stage so at this point I will simply end my speech by commending the bill to the House. 
Hon STEVE CHADWICK (Labour) 
: 
 I am pleased to take a call on the Electoral Referendum Bill. I am not an electoral expert and I am not on the Electoral Legislation Committee but it sounds like a fascinating process and one I think all MPs who participate in the House should take notice of as this is the very reason that we end up here. 
Labour will be supporting the Electoral Referendum Bill. Initially we were concerned about the spending caps on third parties but National has addressed that in the Electoral (Finance Reform and Advance Voting) Amendment Bill that we have just debated so that concern has gone away for us. But one of the things that we are concerned about is the chicken and egg approach to this referendum bill. We think there should have been a review of MMP first before we go to the referendum. 
I am concerned as we go around schools and community groups—and not just in election time—about the lack of awareness that exists amongst many in our communities still about what we call civics literacy which is just the understanding of the democratic process. I do not think $5 million expenditure on a referendum about voting systems will assist raising awareness on the importance of New Zealanders’ right to vote. I am aghast when we go out doorknocking as we do as MPs that people do not understand the current system. In fact the Mana by-election was really interesting. Whether it was just to get rid of us at the door a lot of people said: “I’ve already voted thank you dear.” and we said: “But you can’t have. The election is in the next 2 or 3 weeks.” They would reply: “But I’ve just voted.” So they did not even understand the difference between local government elections and general elections. This was a bit atypical in being a by-election but it showed the lack of awareness that exists. I think we have to start raising that awareness amongst schoolchildren and it is about having civics in the school curriculum and appreciating the value of civics. 
This referendum is to be in the 2011 election and we started this MMP process in 1992-93 so that is nearly 20 years. So this is a good time to look at it anyway. It looks like the select committee has done a very good job of looking at this whole process. I am pleased that there is a $300000 spending limit which is limited to the 3 months prior to the referendum so that the promoters cannot just spend huge amounts of money as we see in the American elections pushing a line that they inevitably will take on which system of voting they prefer. 
New Zealand likes to pride itself on having a very clean process for elections. I will never forget going into Hillary Clinton’s campaign headquarters when she was standing for the Senate and looking at the fund-raising that went on in the American election campaign whether it was for the Democrats or the Republicans and being agog at the amount of money that people were raising for elections. I think in referenda that for those who want to take a position and that is democracy which is valuable to us all $300000 is about right. One could run a pretty good middle-of-the-road campaign with $300000 so a huge amount of money is not being spent to buy the persuasion of New Zealanders. We feel it is right that those who are overrun with cash will not be the key influencers here. 
Labour supports the bill. I am a bit concerned that the Prime Minister has already stated a preference for supplementary member representation because that was part of Peter Shirtcliffe’s campaign that we saw only too well in the previous MMP referendum or debacle really. The Prime Minister going out as the leader of this country saying that that is his preference is already beginning political persuasion. I do not think that is a good thing. I think the possible voting systems that are in schedule 2—MMP first past the post preferential vote standard transferable vote and supplementary member—are very complex as the chair of the committee said and will need quite a lot of digestion by the community. 
I go back to my colleague Pete Hodgson who is an expert on electoral systems and referenda and his question about why we are doing this when the majority of people seem to be relatively happy with MMP but say there may need to be some tweaks. When I go around school groups in particular I think of the representation that is in the House now with MMP. There is more diversity—more women more ethnic representation—and we think that is a good thing. But of course there are improvements we could have made on that system. So that is where we sit. 
But it is great to have open debate again on this subject. I think it is timely. We support the bill. It will be interesting. I do not think even $5 million will educate the public and I think there will again be confusion. I am pleased to see that a lot of time was spent on looking at the voting paper. Last time it was ambiguous and it was confusing. People thought they had voted one way and realised that in effect they had voted in completely the opposite way. That is a very critical tool and I am glad a lot of time has been spent on that because that is where the rubber will hit the road as we will have that first before we do the review. That is Labour’s position on this. Twenty years goes by in quite a hurry and it is great that this issue will be before the country again. 
CATHERINE DELAHUNTY (Green) 
: 
 Tena koe Mr Deputy Speaker. Tena koutou katoa. I will start my acknowledgement of the Electoral Referendum Bill by acknowledging a great leader and a previous member of this House Rod Donald. He did not craft MMP on his own but he was a major player. It is very sad to me that he is not here today to participate in this debate because I am sure he would have some very powerful things to say on this issue. The Green Party is very interested in constitutional reform. Speaking personally I think MMP has been a very major step forward for this country but I do not want it to stop there. I would like to see constitutional reform based on Te Tiriti o Waitangi. I would like to see models followed such as the Bolivian constitution where the principle of Pachamama—Earth first—is built into the constitution. I would like to see the advice of constitutional leaders like Moana Jackson taken into account. We do not need to stop; we need to keep going in reforming MMP. 
However I would like to acknowledge the really good progress that was made at the Electoral Legislation Committee on this bill. The Green Party representative on the committee Metiria Turei said that it was very pleasing considering the doubts that the party had about the bill to actually participate in a positive process and to get to a point where the party was able to fully support the bill. We are very happy with that. I also agree with the previous speaker the Hon Steve Chadwick that the community is relatively politically illiterate on this issue and that we really do need civics education. I think we have to ask who benefits when the citizens are politically literate. That is a real risk and that is why we should be starting at the beginning with civics education. 
The Greens believe that our democracy thrives on ideas not fat wallets. Our electoral process is the central mechanism to ensure that ideas are of greater value than our bank balances. A knowledge of our electoral process is of course important when electing the politicians and parties that make up our Parliament and our Government. It is even more important when citizens have to make a decision about how to elect politicians and parties to Parliament. It is that decision that affects the very core of the representative democracy that we have at the moment in Aotearoa New Zealand. Therefore we must make sure that we make this decision with the best and fairest process possible. Our system is not perfect and it never will be but our democracy should never be static. It should always be evolving with the challenges of the 21st century. That is why I commented earlier on the fact that we are in Aotearoa New Zealand; therefore our country should be based on Te Tiriti o Waitangi as should our constitution. 
This bill is an important step in confirming New Zealand voters’ choice of electoral system. It establishes a two-stage referenda on our electoral system. Voters will rightly make up their own minds as to the kind of electoral system that is best for the country. Voting is one of the responsibilities of citizenship and with that responsibility and with matters like the electoral system citizens need to consider the needs of the country first. In order to do that they need to understand what it is that they are doing. 
As this bill has progressed through the select committee process the Greens have been very happy to play a constructive role in the process. We are particularly pleased that there is a cap on advertising spending by campaign promoters. We argued that that was critical in gaining our support and the 1000 individual submitters who also supported a cap will be very heartened to know that they have been listened to. It restores one’s faith in the select committee process. The Green Party has long campaigned on a fair and democratic electoral process that favours all citizens not the wealthy few. The influence of money on politics is one of the greatest threats to freedom and to democracy. We know that in Aotearoa wealthy non - political party actors can intervene in the election process by buying advertising and distorting the process in favour of their agenda. For that reason modern democracies all around the planet have introduced rules to try to limit the influence of money on politics. So a cap on those campaigning in the electoral referendum just as there are caps in other referendums is a critical step towards a fairer process. 
The Green Party also holds open democracy as a central tenet of the New Zealand polity. It is important that the public knows who is involved in advertising both for and against MMP. We also believe that the identity of donors and the amount they donate should be public knowledge as then people can make up their own minds about the messages they have been given. 
The extensive select committee process confirmed much of the detail of the original bill such as the referenda timetable the review of MMP and arrangements for the vote. The detail that changed was the improvement of the ballot paper. Again there were many submissions on this point and the committee was very responsive—all credit to it. We heard from many submitters that the review of MMP which has triggered 50 percent of voters to vote to keep MMP should be given some emphasis in referendum publicity. They believe that this is such an integral part of the referenda proposal that it should be given prominence especially in the public information process. We support this and we sought to have a review of MMP regardless of the outcome of the 2011 referendum. We will support Labour’s Supplementary Order Paper on that issue during the Committee stage of the bill. 
We in the Green Party do not hesitate in affirming our support of MMP. MMP has meant that many more New Zealanders are represented in Parliament and in Government. MMP has enhanced the representation of women of Maori of Pacific peoples and of Asian people in this House. MMP means that different ideas ideologies values and solutions are represented in Parliament and Government. I would not hesitate to say that having different voices in the select committee hearings has resulted in a better bill and it is because of MMP that we have those different voices present instead of just a single monolithic adversarial tradition. The advent of new parties has gifted the House with a creativity and innovation that was absent during the long reign of the duopoly of Labour and National and it is great to see Labour at least supporting that. MMP has increased the breadth of Parliament so that it better reflects the country as a whole. Our country is now very diverse and more politically aware in terms of the Treaty and in terms of different cultures than in the past and our Parliament must reflect that. 
We still do not have 50 percent of women in Parliament. We still do not have that gender balance in Parliament. Some countries have quota systems to ensure that they have that. We still have a way to go but we have improved because of MMP. If we are to be in any sense a House of Representatives then surely a system that increases representation of New Zealanders is the goal. I know that women MPs and obviously National women MPs in particular must be proud of the number of seats they now command in this Parliament compared with previous Parliaments. 
The Green Party believes that our citizens deserve a fair electoral system that is representative of the vast majority of New Zealanders and that is able to meet the expectations of our progressive 21st century Aotearoa and we look forward to its continuance. We also support the progress that was made at the select committee and we are pleased to be able to continue our support for the bill now. Kia ora. 
Hon JOHN BOSCAWEN (Deputy Leader—ACT) 
: 
 The ACT Party will be supporting the Electoral Referendum Bill. However once again we have major reservations about placing a limit of $300000 on what a third party or a group of individuals can spend to promote one of the four alternatives. I would like to go back and listen again very carefully to the speech made by the previous speaker Catherine Delahunty because I was somewhat surprised by her comment about buying advertising to distort messages. It might surprise the member to know that the Green Party spent $1.5 million at the last election and I wonder whether she is prepared to concede that the Green Party spent $1.5 million trying to distort the truth. The reason that the ACT Party will be supporting— 
Catherine Delahunty 
: I raise a point of order Mr Speaker. I think it is quite offensive to say that we spent that money to distort the truth. 
Hon Members 
: You did. 
Mr DEPUTY SPEAKER 
: Order! 
Catherine Delahunty 
: No—and I think it is a really offensive comment. 
Mr DEPUTY SPEAKER 
: The member has taken offence. Under Standing Order 116 I ask the member to withdraw that comment. 
Hon JOHN BOSCAWEN 
: Because the member has taken offence I withdraw that comment. 
Mr DEPUTY SPEAKER 
: Well you do not need to qualify it. I ask the member to continue. 
Hon JOHN BOSCAWEN 
: Let me clarify what I was saying. The member talked about organisations—individuals grouping together—raising money and spending money. As I said I am quite keen to listen to that speech again because I am sure I heard the word “distort”; I am sure I heard that word. If the member is suggesting that individual groups and organisations that want to participate in the electoral process want to distort the truth then how do we know that the Green Party did not spend $1.5 million to also distort the truth? That is all I am asking. What makes the paid messages of the Green Party any different from the paid advertising messages of any other party or any other organisation that wants to participate in the electoral process? I note that the member referred to the late Rod Donald. He was a person who wanted to encourage New Zealanders to participate in the process. 
Catherine Delahunty 
: But not the rich buying it up. 
Hon JOHN BOSCAWEN 
: Let us look at this $300000 limit because we have just heard another interjection from the Green member who said “But not the rich.” I think that was the point that Pete Hodgson was trying to make. He asked why the ACT Party has such an objection to restricting people to $300000. Well it is not as though it is one individual; organisations can be formed to push one or more of the particular four electoral options. I think Mr Hodgson conceded that a group of people could be clubbing together—I think he used those words. 
I express the ACT Party’s objection to the $300000 limit in the context of what the major political parties could spend in their own campaigns. I noticed that in Mr Hodgson’s response he said that one could spend that but that possibly in reality one would spend substantially less. It might surprise Mr Hodgson to know that if one looks at just the core spending of the Labour Party at the last election—ignoring the broadcasting and ignoring what the party spent—one would see that the Labour Party was entitled to spend $2.4 million yet it spent $2.271 million. So it was within $130000 of the maximum. 
Let us come back to this $300000 limit but let us also come back to the reason we are having this referendum. I think Amy Adams put the reasons for having the referendum very very well. She said that most New Zealanders had a perception that there would be a second referendum. Most people if we asked them honestly would say they were going to get a second vote. But she said that people had not looked at the fine print and the little asterisks on the footnote that said: “only if Parliament agrees.” 
National promised at the previous election to put this issue to the vote and I say: “Good on them for doing just that.” Labour asked why. Well this bill is enabling New Zealanders to express a view on their electoral system. Ultimately that is the reason that the ACT Party is supporting this legislation. We support the right of New Zealanders to be involved and to express a view. We do not support the fact that an artificial limit has been put on the amount that groups that club together can spend. Nevertheless we support this referendum and we will be voting for it despite that reservation. 
Interestingly Steve Chadwick said that $300000 will buy a reasonable campaign. I would like to remind Steve Chadwick that the contestants in the mayoral campaign for Auckland were entitled to spend $500000—$500000—to put their message across. What did we see in the weeks leading up to the Auckland vote? We saw Len Brown on television every night night after night for 3 weeks. I congratulate Len Brown. I thought the television advertisements he did were very good and he certainly got the jump on his principal opponent Mr Banks. Len Brown was entitled to spend $500000 to communicate with the people of Auckland but we are going to restrict the amount of money that can be spent by people in New Zealand who want to club together to form an organisation a support group in favour of one or more of the various options. We will restrict the amount to just $300000. 
I also thought Steve Chadwick made another very interesting comment. She said the public information campaign that is budgeted to cost $5 million probably will not be sufficient. So she and the other Labour members are prepared to say that the State can go out and spend $5 million educating the public but that the State will restrict to $300000 the spending of any group of people who want to club together to vote for and promote one or more of the options. 
Earlier this afternoon Mr Hodgson made a reference to the 1986 Electoral Commission. He correctly recorded the fact that the Electoral Commission said that if we are going to restrict political parties why would we not restrict third parties? He also said that the Electoral Commission in 1986 put up the proposal that there should be State funding of political parties. I would like to remind Mr Hodgson that we already have massive State funding when we travel around our electorates. Members of Parliament are paid salaries. In essence they are funded to campaign. 
What else did that Electoral Commission say? That Electoral Commission in recommending MMP said there was no reason for the Maori seats. There is no reason for the Maori seats because if we have an MMP vote that is strictly proportional each party will have in Parliament its share of the party vote. The Electoral Commission in 1986 said there is simply no need to retain the Maori seats. The ACT Party strongly opposes electoral seats based on a racial basis and we will be putting forward an amendment in the Committee stage to have a referendum on that very issue. If we go to a great deal of expense to conduct a referendum on MMP the ACT Party says we should actually be holding a referendum on Maori seats at the same time. We should let the people of New Zealand express a view. 
Mr Hodgson earlier this afternoon asked why we are having a referendum. He actually queried whether it was in the National Party manifesto. The Minister of Justice said that yes it was. Mr Power said: “Yes it is in the National Party manifesto.” I would like to remind the National members in the House this afternoon that there is actually something else in their manifesto and that is an intention to abolish the Maori seats; to abolish seats that were based on a racial divide if you like or that were created along racial lines. 
The ACT Party strongly believes in one law for all. We do not believe that we should be having those electoral seats. This is a tremendous opportunity if we are going to the expense of having a referendum to put that vote to the people of New Zealand and to give them a chance to express an opinion. Thank you. 
HONE HARAWIRA (Maori Party—Te Tai Tokerau) 
: 
 Kia ora. On behalf of the Maori Party I say we support the Maori Sports Awards because we think that gives us the opportunity to showcase excellence in Maori sport; we support the Waiata Maori Awards because we think it gives us—the nation—the opportunity to highlight excellence in Maori music; and we support the Maori seats because we think it gives Maori people the opportunity to vote for excellent Maori candidates. We do not think that they are race-based; they are about increasing democracy and increasing the right of every sector of this community to have their say in the sorts of people they want to represent them in Parliament. MMP in fact is not necessarily the best option for the Maori seats because all of us from the Maori Party are in here because we won our seats. We nevertheless support MMP because MMP has meant greater participation by Maori in the electoral system. Anything that is going to increase the participation of New Zealanders generally in the electoral system has to be applauded. I look at the make-up of the House and I listen to the different twangs and the different ways in which people speak and I realise that that is the way this country is made up. To try to deny that and to deny tangata whenua particularly the opportunity to take their place in this House is simply wrong. 
We will not be supporting at all ACT’s amendment to the Electoral Referendum Bill to have a referendum on the Maori seats. We know that it is going to be defeated whether it comes up through select committee or comes up in the House simply because it is an issue that will be voted on on the basis of intelligence. So that amendment is likely to die as soon as it gets raised. The Maori Party does not support broad-brush referenda as an effective form of gauging Maori views. We support the view that Maori should be properly represented in Parliament in a way that reflects their place as the Treaty partner. We support a more comprehensive discussion with Maori over the whole range of issues affecting Maori and the electoral process. We support legislation that ensures elections are fair and reflect adherence to Te Tiriti o Waitangi. We support an electoral system that advances the reconciliation of kawantanga and tino rangatiratanga. We support MMP because it has meant increased participation by Maori in the political system and we support the opportunity for the nation to discuss these issues so all sectors of our society can engage in this debate. 
We also support a cap on advertising expenditure by groups participating in this debate. When I heard about the amount of $300000 even that was quite a scary figure. I note that one candidate recently spent $25000—$25000 just to get some legal advice on his own position in coming into Parliament. I was quite stunned because it cost me $25000 for my electoral campaigns. That was not for each campaign either. It was $13000 for the first one and $12000 for the second one. So when I hear people talking about $300000 what are they talking about? We are talking about essentially different systems. I see the way in which big money is used and has been used quite divisively in the past. I have to say that the same crowd who ran the “Iwi/Kiwi” campaign back whenever they ran that is the same crowd running the Coastal Coalition campaign nowadays. So I know absolutely the damage that can be caused to our society by allowing untrammelled use of funding to push a particular point of view particularly one in terms of the Coastal Coalition that is clearly devoid of the reality of the legislation. That funding is being used simply to drum up fear of Maori getting access to the foreshore and seabed when the law clearly states that we will not get it. The Prime Minister himself has said that it is unlikely that Maori will be able to get it. 
When we talk about the amounts of money used in campaigns of that sort—or of any sort in fact—I am very wary about there being an open-door policy. The Maori Party opposed the Electoral Finance Act back in the day because we did not like the way in which we felt that Labour was trying to limit people’s abilities to participate in the electoral process. But what we are talking about here is the process itself the way in which this country will vote. I do not think that the success or otherwise of that debate should be determined on the basis of the kinds of campaigns people are able to run based on how much money they have to use. So we will be supporting the Electoral Referendum Bill and we will also be supporting the opportunity for MMP to continue after this bill is done and dusted. Kia ora. 
KATRINA SHANKS (National) 
: 
 It is my pleasure to take a call on the second reading of the Electoral Referendum Bill today. As the Minister of Justice stated earlier this bill received about 1000 submissions. The majority were in favour of supporting this bill in one form or another. 
This bill honours National’s pre-election promise to hold a referendum on the voting system no later than 2011. This bill is interesting because when it comes into law people will get two votes in the referendum that will be held with the general election. The first question people will vote on is whether they wish to keep the current MMP voting system. That is the first vote people get. The second vote people get is on which alternative voting system they would prefer from a list of options if New Zealand were to change to another voting system. 
If the majority of New Zealanders vote to keep MMP then the Government will make the commitment to review MMP to see whether any changes need to be put into that system—that is MMP will stay but the Government will look at the system to see whether it can be improved. But if the majority of the country votes not to have MMP people then get to pick one of the alternative systems that will be listed in one of the two votes in the 2011 referendum. 
If people decide not to vote for MMP the alternatives are FFP or first past the post which is what we had previously; the preferential voting system; the single transferrable vote system; and the supplementary member voting system. We have to ask ourselves how many people out there know what those voting systems actually are and what they represent. 
Grant Robertson 
: How many people in here? 
KATRINA SHANKS 
: I can even ask as a member of Parliament—and the Opposition is saying the same—how many people in this House understand what those voting systems represent. They are complicated. 
Our key message will be education education education. A member of the Opposition who spoke earlier Steve Chadwick said it is all about having civics education in the curriculum. Well it is about that but it is actually greater than that. It is about all 122 of us as members of Parliament going around all our schools going into the classrooms and talking to children about democracy and getting them engaged in understanding it. I already do this in my local schools in Ohariu. It is the kids coming through school who have to understand the system as well. They have to know what democracy is all about. 
I go into my schools in Ohariu. I was at Onslow College just the other day talking about the reform of alcohol laws that is coming in. I was trying to encourage those kids to come in here give a submission be part of the democratic process and get the feeling that they can make a difference. 
We have a big job ahead of us of engaging the public to want to know what these electoral systems are engaging them to make an informed decision and giving the information to them in a way that they can understand it. It was a pleasure to take a call on this bill and I look forward to its next reading. Thank you very much. 
CHRIS HIPKINS (Labour—Rimutaka) 
: 
 I rise to speak on the Electoral Referendum Bill as an enthusiastic student of electoral systems. I think it was in about 1998 that I did a POLS 206 course at Victoria University taken by Professor Nigel Roberts in which he went through all of the different electoral systems that were on offer the last time that New Zealand discussed this issue. He transposed historical election data and tried to interpret what the outcomes would have been if those systems had been operating at those historical elections. It was a really interesting paper and it would be fair to say it captured my attention for the whole semester even though the nature of the topic is something other people would find very dry. It is fair to say I think the New Zealand public are being presented with an exciting array of options in the coming referendum. I will talk about a few of those in a moment. 
Going back to the history of how we ended up with MMP in the first place I think much has been written about and many people have commented on the fact that it was almost like an act of vengeance from the voters who were unhappy with the way that Parliament had been behaving. Laws had been passed without the consent if you like or the implied consent of the majority of the New Zealand public and those laws were at odds with public opinion. It was almost as though MMP was adopted as a way of trying to slow Parliament down and bring it back under the control of the people. I think MMP has done that to a large extent. We do not have the laws being passed very rapidly through Parliament now that we did under first past the post. Having said that I say there are a few exceptions to that and we have seen some in the short period of time that I have been in this Parliament. But overall I think MMP has led to a slower parliamentary process and a process that is more responsive to the views of all New Zealanders. 
MMP has also led to a much more diverse and representative Parliament and we see that when we look around the debating chamber. Now parties are represented in Parliament that were not here prior to MMP and ethnic minority groups are now represented in Parliament that were not here prior to MMP. So there is a lot at stake in terms of what a change to the electoral system might mean for the way that Parliament functions and what Parliament consists of. 
However I think that changing the electoral system is not the most pressing constitutional issue that we have. If we go back to the idea of voters’ vengeance—one of the books that was written about the MMP referendum in 1993 was called  
The Voters’ Vengeance 
—we realise one of the concerns was that Parliament rapidly passed legislation that the public did not necessarily support. We can do things that place more of a check on this House. We have a very simple representative democracy here in this Parliament and there are very few constraints on what this House can do. If we are talking about constitutional reform then the idea of introducing constraints is something that we might want to talk about. For example in the use of Parliamentary urgency should there be criteria that need to be met? I would argue that that would be a more significant constitutional discussion for us to have than one about changing the electoral system that determines how we end up getting here in the first place. 
Hon Dr Wayne Mapp 
: The Clark Government never even had question time in urgency. 
CHRIS HIPKINS 
: I do concede to Dr Mapp that having question time when Parliament is in urgency is a good innovation and I congratulate the Government on doing that. 
Coming back to MMP and this referendum however my concern is that the review of MMP will be undertaken only if the majority of people vote in the first referendum to keep MMP. I think that is disappointing. I would like to see the review of MMP happen anyway regardless of the outcome of that referendum. I think even if we get to a second referendum where MMP is traded off against another system it would be good for voters to know what voting to keep MMP will entail. I think improvements can be made to the MMP electoral system that will alleviate some of the public’s concerns and make them more inclined to want to keep it. They should know about that before they have to vote in both the first and the second referendums. I argue that we should do the review of MMP as soon as possible but certainly before the referendums are undertaken. 
Before I turn to the menu of options that voters will be given I want to briefly talk about the rules on regulating what campaigners can spend on this referendum. I particularly take exception to some of the examples that John Boscawen used in his speech when he talked about the amount of money that political parties have spent in general election campaigns. The nature of a general election campaign is very different from that of a referendum. There is a wide array of candidates campaigning across a wide range of issues so the amount of money and the volume of activity are much wider than is the case with a referendum. In a referendum there is a specific issue. There are usually a very limited number of choices and the debate is very limited in terms of what is covered so a smaller spending limit for referendums is very reasonable and relevant. To try to compare the spending limit for a referendum with a spending limit for a political party in an election campaign is I think a little unfair. 
I was amused by Mr Boscawen’s reference to the Auckland mayoral election. Almost by inference he seemed to be arguing that the candidates on the right needed to have a higher spending limit because they ran worse campaigns than the candidates did who were on the left in the Auckland local body election campaigns. I simply say people did not vote for John Banks because they did not want him; it was not necessarily because of the quality of his television advertisements or the lack thereof. 
I move now to the menu of options that voters will be given should they choose to remove MMP and adopt an alternative system. Obviously all New Zealanders are very familiar with the first-past-the-post electoral system; it is the system that we had prior to 1996. My concern is that I think going back to it would result in a real loss of the minority voices that we see in the House at the moment. 
We then have the preferential vote system which we saw in operation at the Wellington mayoral election. A National Party mayoral candidate argued there that because she had received more first-preference votes she should still be the mayor even though the candidate who actually ended up winning received more second and third-preference votes and ended up defeating her on that basis. 
Grant Robertson 
: As was done at the previous election. 
CHRIS HIPKINS 
: That National Party candidate had won at previous elections when that method was used. So the voters of Wellington will know what the preferential voting system looks like because they use it for their mayoral elections and I know that a number of other territorial local authorities also use a preferential voting system. 
There is also the single transferable vote system. Again candidates are ranked as one two three four five and so on. The difference with the single transferable vote system is— 
Hon Dr Wayne Mapp 
: Go for it Chris! Explain it to us. 
CHRIS HIPKINS 
: I tell that member to hold on to his hat for just a moment. The difference with the single transferable vote system is that the electorates are much larger and there are multiple members for an electorate. I think one of the public’s concerns about that kind of system would be that they like to know who their representative in Parliament actually is. One of the concerns about list members of Parliament—and I am sure we all hear it expressed from time to time—is that they are not accountable directly to an electorate. Whether anybody agrees with that— 
Hon Dr Wayne Mapp 
: Explain it to us. We know about the problems. 
CHRIS HIPKINS 
: I will get into the single transferable vote system in more detail. Wayne Mapp is very impatient but I will get into it in more detail. Basically under the single transferable vote system all of the candidates are ranked as one two three four etc. In order to be elected to Parliament—and again the threshold will differ depending on the size of the electorate—a candidate will have to receive a certain number of first-preference votes. If a candidate gets that number on the first preference then he or she becomes a member of Parliament. The number of first-preference votes needed would differ depending on the size of the electorate. If at the end of the allocation of first-preference seats there are still vacancies then the lowest-polling candidates drop out and the second preferences are reallocated. If based on that somebody receives enough votes then that person gets the next spot. It means that constituencies can have multiple members of Parliament. Rather than there being a single representative for an area there might be multiple representatives. 
Hon Dr Wayne Mapp 
: Not bad; pretty good. 
CHRIS HIPKINS 
: It is not a bad explanation. 
Finally the last system is the supplementary member system. I would call it “first past the post with the winner’s bonus”. I know it is the system that John Key seems to be leaning towards. I do not necessarily support it. If we look at what the supplementary member system would have done to our MMP elections we can see it could have dramatically altered the outcome of some of those elections. Of course voter behaviour might well have changed resulting from a change in the electoral system. We cannot just assume that if the electoral system is different voters will still behave in the same way as they did. Of course campaigns would also be run differently. We see National and Labour campaigning under MMP in areas where they did not campaign before because under first past the post there was no value in doing so. So voter behaviour could well change. 
Overall I will leave it at that given that my time is expiring although I will say I am looking forward to the ongoing discussion on this issue. 
MICHAEL WOODHOUSE (National) 
: 
 To the question that was posed by Mr Hodgson as to why we are having this referendum I say that to me the answer is quite simple: because there was a genuine misunderstanding that the law required a review only and the popular perception was that a referendum would be held in 2002. 
That was what the review led by the Rt Hon Jonathan Hunt in 2001 acknowledged. Even the submitters who were opposed to a further referendum went on to say that the reasons why most of them were opposed to that referendum was that it was too soon and that a referendum should be held later on. Well we drifted through the first decade of this millennium and there was no appetite from our friends on the other side for having one. The simple fact is this: National believed that a referendum was the right thing to do. We campaigned on it and we are delivering on that promise. 
Many members have been at pains to be neutral about what they think of proportional representation or MMP. I am not. I am a supporter of proportional representation. In fact my very presence here depends on it at least in this parliamentary session. I have every expectation that that will not be a problem after 2011 but only time will tell in that respect. 
One of the things that I am very concerned about is not so much proportional representation as such but the thin spread of electorates particularly in the South Island. This issue taxed the royal commission which recommend 14 electorates. We ended up with 16 statutorily in the legislation but the urban drift particularly into Christchurch is stretching those remaining electorates so large now that I think it is very very difficult for electorate MPs to adequately get around these enormous electorates. 
I think it is fair to say that most list MPs fulfil their obligations very well in what a speaker earlier today described as their “communities of interest”. I think that is a really good way of describing what list MPs do. One recalls that there was a belief that under MMP list MPs would get a bit lazy and not do the level of work of electorate MPs. I think that ironically the opposite is the case. I have half the staff resources in my local area and I look after twice the number of electorates. Being a Government MP the door is opening pretty frequently. 
I think the issue of what MMP might look like if it is still preferred by the public after this referendum is really important. I do not agree with My Hipkins that a review should be held before the referendum. The range of options is just too broad for that to be the case. I strongly support the Electoral Referendum Bill and I really look forward to the outcome of the referendum. 
GRANT ROBERTSON (Labour—Wellington Central) 
: 
 My colleague Chris Hipkins referred to being in Nigel Roberts’ class in 1998 and going through various options on electoral referendums. I can go back a little bit further to when Mr Hipkins was perhaps a bit young—he is gone now so I can say these things about him although I should not say that. In 1992 when the original referendum was going through I was a student politician at Otago University as I was in 1993 when we had the second referendum. It would be fair to say that as students we put a lot of effort into promoting MMP. In fact I recall trying to justify it to a group of students on the basis that if the imaginatively named “Student Party” contested the elections and secured 5 percent of the vote we would have students in Parliament. It was an interesting idea—one that I am not quite as keen on as I was then! 
As a number of other speakers have said through the 1980s and 1990s both a Labour Government and a National Government operated—in the words of a current member of our Parliament—in quantum leaps with what some would say was disregard for the views of the electorate putting in place programmes that had not been put before the electorate. I think there was a mood in the country in the early 1990s to punish not so much Parliament but the executive or two executives in a row from two different parties in Government. That mood was pervading the country and it was ripe for change. It was ripe for change not to only the speed of government which is what I think was happening in the 1980s and 1990s but to also the extent to which this Parliament was representative of the country. I too am prepared to proudly say that I am a supporter of proportional representation and I am a supporter of the MMP system for two reasons that I will now discuss which are relevant to the Electoral Referendum Bill.  
The first reason is the representative nature of this Parliament. Statistically we can look at the number of women members we can look at the number of Maori members and we can look at the number of members representing ethnic minorities in this country and see that demonstrably MMP has meant that this Parliament is more representative. That is a good thing. It is a good thing too that political parties that can earn more than 5 percent support in this country get to be represented here because to me that level of support means there is a viewpoint out there that should be heard. I think the ideas that Mr Boscawen and his colleagues put up are frankly bonkers most of the time but those people have the right to be heard here. He probably thinks the same about me and the Labour Party. But the fact is that parties deserve to be here if they can earn that 5 percent and I will return to that question in a moment. 
We have an MMP system that has allowed government to operate more slowly and on more of a consensual basis. Both Labour in office and now National in office have developed ways of making MMP work of making coalition Governments work and including parties. The risk for all parties is where those arrangements do not appear to the electorate to be governing in a fair way. The classic tail wagging the dog situation is where the public becomes concerned about elements of MMP but overall I am strongly of the belief that this Parliament is a better and more representative place because of the system of proportional representation that we have. I do not believe that the public is in the same mood to punish politicians that it was in the early 1990s and that is in part because MMP has required politicians to work in a more consensual way in a slower way and we have had a more representative Parliament to do that. 
But we now find ourselves facing a referendum. Labour is supporting it as part of an overall package of changes to the electoral system and we are happy to do that. We are particularly happy to do that because of there now being spending caps and I will return to that point in a moment. But I think we have the cart somewhat before the horse when it comes to the two referenda that we are looking at under this bill. I strongly believe that if we are to do this—and there is some question in my mind about whether it is necessary—then we should be reviewing the system first. We should be reviewing the system first because there is widespread acknowledgment among those of us who are strong supporters of MMP that there is room for improvement. 
The particular area where I think there is room for improvement is the so-called electorate lifeboat. In this Parliament that situation is represented by the ACT Party. Because Rodney Hide has won the Epsom seat we are now treated to the spectacle of five ACT MPs in this House. Whatever people might think of the Rt Hon Winston Peters his party polled at 4.3 percent I think it was in the last election and it is not represented in this House. The question has to be raised as to whether that electorate lifeboat is in fact fair. If the ACT Party is polling at 3 percent of the vote then why do we see it now represented in this House by five MPs rather than just the one MP who won the electorate? I do think that area could be relooked at. I noted that should the first referendum lead to a second referendum then a review will take place and it will include that question of proportionality and of how people are represented. But I think it is a particular area that could be looked at. 
There are obviously other issues that need to be looked at. Some people have raised a concern about the mix of electorate and list members. Mr Woodhouse has just mentioned questions about the size of the electorates and I think a number of the members of Parliament who represent electorates are concerned about that issue. 
These questions could be dealt with in a review prior to a referendum so that we know what we are really discussing. As it happens we will get that review if we go to a second referendum. The review should happen anyway—that is what members on this side of the House believe. We think it should happen first. In any case regardless of what happens in the first referendum there should be that review so that we can clear up some of these matters. 
I would disagree with one thing that my colleague Chris Hipkins said. He said that all New Zealanders would be familiar with first past the post. That is actually not true in my opinion. I think that people under the age of 35 know nothing other than MMP when it comes to a voting system. I believe that the question of what people understand about the systems is a moot point. I think there is a lack of understanding across the board and I very much endorse the comments of Catherine Delahunty and Steve Chadwick about civics education. One of the things that we need to do significantly better in this country is helping people understand from an early age how the voting system works what their role is in society and how they can influence decisions. 
It is quite clear that members on this side of the House are happy to support this bill given the changes that have been made to it but I believe that the timing and sequencing of the referenda and the review have put the cart before the horse and will perhaps confuse some people unnecessarily. I think we could certainly find our way to a situation where we have the review anyway regardless of the outcome of the first referendum. 
I will talk about two more things in my contribution. The first is the question of the spending cap. I am very pleased to see the spending cap of $300000. I acknowledge that it is difficult to come up with a number—why $300000 instead of $500000? But the Electoral Legislation Committee has attempted to get the balance right between participant equality and participant freedom in elections. This is something that Andrew Geddis from Otago University has written about. It is a difficult balance in every electoral system in the world—the freedom for people like Mr Boscawen to participate and to put money into a particular issue and the equality question of how we make that fair so that elections cannot be bought and so that referenda cannot be bought. It is a difficult balance but I believe that the committee has done the right thing by putting a spending cap in place. 
We know that the likes of Peter Shirtcliffe are interested again. Mr Shirtcliffe is out there promoting the supplementary member system which Mr Key now seems to favour. It is not a proportional system in the terms in which it has been put before the electorate. It means that only 30 of the 120 seats would be allocated on a proportional basis—90 of the 120 seats would be first past the post. That is not proportional representation. I am sorry to say that I think Mr Shirtcliffe will try to present it in that way but it is not. 
In conclusion I believe that the bill has come back from the committee in much better shape. The fact that we now have a spending cap in place will ensure to some extent that participant equality is balanced with participant freedom in this referendum. I would urge all of us as MPs to ensure that we work hard in our electorates to make sure that people understand as much as possible this referendum and about what the options are. From my point of view I believe that MMP has served us well over the last 14 years or so and I would like to see it continue but we in Labour are committed to supporting this bill so that the referendum can take place in an orderly manner. 
DAVID BENNETT (National—Hamilton East) 
: 
 I will take just a short call on the Electoral Referendum Bill. Most parties in this House have gone through the issues of the different aspects of proportional representation and have talked about the public’s awareness and their desire to have their say on how they are represented in this House. This bill is the practical aspect of giving that option to the public at the next election. 
We support this bill. We will see that it goes through the House and that the public has the option of making their point of view known to Parliament at the nearest convenient time. Thank you. 
Amendments recommended by the Electoral Legislation Committee by majority agreed to. 
Bill read a second time. 
Ngati Apa (North Island) Claims Settlement Bill 
Instruction to Committee 
JO GOODHEW (Junior Whip—National) 
: 
 I seek leave for the debate of all parts of the Ngati Apa (North Island) Claims Settlement Bill to be taken as one debatable question. 
Mr DEPUTY SPEAKER 
: Leave is sought for that purpose. Is there any objection? There is no objection. 
In Committee 
Preamble clauses 1 and 2 Parts 1 to 3 and schedules 1 and 2 
Hon MARYAN STREET (Labour) 
: 
 It is a great pleasure to speak in the Committee stage of the Ngati Apa (North Island) Claims Settlement Bill. Although I am more familiar with the members of Ngati Apa who reside in Te Tau Ihu I am very familiar with the land and the territory that we are considering in this settlement bill which relates to the North Island parts of the Ngati Apa iwi. I will start by referring to the words of one of my colleagues in the first reading of this bill. Mita Ririnui detailed the background to this settlement. We have now rolled up this Committee stage all together into what I understand can be quite a wide-ranging debate and I would like to traverse some of the comments that Mita Ririnui made in the first reading. He said that the history is interesting. Ngati Apa entered into negotiations with the Crown during the late 1800s. He said: “Ngati Apa entered into a process which basically began with the signing of the Treaty of Waitangi for a simple purpose: they encouraged settlement but at the same time they wanted to be recipients. They wanted to be in the position where they could benefit from much of the technology brought here by the settlers. So they entered into many discussions with Crown agents many of whom are mentioned in the preamble to this bill. Certainly they are mentioned in the historical account. But that did not happen. In fact Ngati Apa went through a process of being subjected to land confiscation and land acquisition to the point … where they were left with simply 1 percent of their original land holding. For them that had a tremendous impact. … It led to the undermining of their culture the loss of their language and the fragmentation of their whanau hapu and iwi to the extent that they did not participate in the development of the Rangitikei area. In fact they were what we might call onlookers.” 
I take those words from my colleague as a starting point for the detail of this settlement bill. Here we are finally after many many decades and many lives and deaths of tupuna from the Rangtikei area who will have been aware of this travesty from the moment of their birth until the moment of their death. They will have passed on the concerns and the grievance about the injustices to people who now carry the torch on their behalf. 
Another of the points that have been noticeable in this whole settlement process of the North Island Ngati Apa settlement has been the involvement of young people of young negotiators. Here we have something that I suppose represents some of the worst and some of the best of our Treaty of Waitangi history in New Zealand—some of the worst in that the land confiscation and deprivation of a living or a livelihood were amongst the worst of the crimes that the Crown committed against iwi. But we also have some of the best in that we have young people young leaders emerging in Ngati Apa who have been able to take this claim forward and to press for the kinds of redress that are now familiar to us in the Treaty settlement process. There is an apology and this is right. It is proper. There is cultural redress and that is right and proper. There is compensation and that is right and proper albeit probably nowhere near the dollar amount that could quite legitimately be claimed by Ngati Apa. There is finally the restoration of some parts of land and property Crown forest land which is part of this settlement. 
So we have all these elements here and in this Committee stage it is important to reflect on some of the words on the page. It is very clear to whom this bill refers and what the meaning of “Ngati Apa (North Island)” is. Those people are identified and are written into the legislation. There is provision for cultural redress in Part 2. The very purpose of the legislation at the outset is to record the acknowledgments and the apology offered by the Crown in a deed of settlement. Part 2 refers to the cultural redress but Part 3 provides for commercial redress which includes the transfer of settlement-licensed land and public access to the wahi tapu on that land. Clauses 7 and 8 record the acknowledgment and apology offered by the Crown to Ngati Apa. The text of that acknowledgment is written in full in the bill. The text of the apology is also written in full. I think those things can bear scrutiny and discussion in Committee. 
Nobody in this Chamber will disagree with the settlement legislation. Let us wait and see but I imagine that nobody will disagree with this. I do not want to labour points unnecessarily but it seems to me that we have another good example of settlement legislation that does deliver the things that are now absolute prerequisites. I look forward to the day when historical claims are settled they are over and that period of our history has been settled. 
Sitting suspended from 6 p.m. to 7.30 p.m. 
Hon MARYAN STREET 
: I shall finish this contribution on the Committee stage of the Ngati Apa (North Island) Claims Settlement Bill simply by referring to a couple of bits in the bill that often do not get the airplay they deserve. Before the dinner break I referred to the fact that the text of the acknowledgments by the Crown and the apology offered by the Crown are set out in the bill itself. It is worth referring to these because in the descriptive bits that preface the legal clauses of the bill the text of apology says this in clause 8: “(1) The Crown recognises the efforts and struggles of the ancestors of Ngati Apa (North Island) in pursuit of their claims for justice and redress from the Crown and makes this apology to Ngati Apa (North Island) and their descendants. (2) The Crown profoundly regrets and unreservedly apologises to Ngati Apa (North Island) for the breaches of the Treaty of Waitangi and its principles acknowledged above. (3) The Crown regrets and apologises for the cumulative effect of its actions and omissions over the generations to the present day which have had a detrimental impact on the traditional tribal structures of Ngati Apa (North Island) their access to customary resources and significant sites economic and social development and their physical cultural and spiritual wellbeing.” 
These are the clauses that matter together with the cultural redress the compensation and the return of lands. These are the things that cement in our future going forward. Thank you Mr Chairperson. 
Hon PAREKURA HOROMIA (Labour—Ikaroa-Rawhiti) 
: 
 Kia ora Mr Chair. I rise to support the Ngati Apa (North Island) Claims Settlement Bill. I follow on from the previous speaker Maryan Street in saying that the bill has been a long time getting here. There are dates in here relating to 1842 and 1862. 
The North Island Ngati Apa claim is very very interesting. There is explicitness about what was taken from them what was given to them and how they were charged for the advice or whatever that was given to them a long time ago. I recognise and remember my colleague Dr Cullen who is not here for the effort he put into this bill; Mita Ririnui who is doing great work on the road; and of course myself. I thought I would thank myself for this. It is great to see the Crown moving this bill along. I look forward to the day when it will start a claim and finish one. I need to recognise the Minister for Treaty of Waitangi Negotiations who has put in a whole lot of effort and I acknowledge that he is trying to get there. 
There were some peculiarities about this claim. There were some tensions amongst the iwi themselves about a dozen or 15 years ago about even taking a position. I mention from the outset the incredible adoption and adaption of the old people and the young people. This was one of the first claims that I saw for many a year where the old people stood up and decided to tell the young people they should get out and finish off the job but that they had to report back to them. It was wonderful to watch. It took a lot for the older leadership to ensure that they were understood. It took a hang of a lot of effort by Adrian and his crew to do the deal and they did it well. 
I hazard a guess that claimants could take a great lesson from the effort put into this claim by these people. Ngati Apa as a group has been raising grievances with the Crown for over 100 years—a long long time—and how they got to the final post needs to be celebrated. It was a mix of the old people and the young ones who took it forward. 
The longstanding grievances have taken their toll and the iwi have lost a lot of their leadership. They have been traded out and surrounded by a whole lot of other groups—people who have settled their lands who took them by force. From 1848 the Crown purchased over 400000 acres of land in which North Island Ngati Apa held interests. Through these land transactions North Island Ngati Apa endeavoured to establish a relationship with the Crown. That North Island Ngati Apa sought subsequently to strengthen this relationship by expressing loyalty to the Crown has not I feel been recognised well enough by successive Governments. I am certain that in order to get to this stage all of that misdemeanour can be put asunder. 
They undertook to strengthen the relationship. They chose to set a framework to work within and then invited Governments into it. I believe that the North Island Ngati Apa claimants were some of the most hard-done-by in the sense of people removing land from them shonky deals and all that sort of stuff. The 1849 Rangitikei-Turakina purchase stated that lands between the Whangaehu River and the Turakina River—approximately 35000 acres—would be received for all of North Island Ngati Apa to collect and settle on. That was in 1849. Later native land legislation enabled these reserved lands to pass through the Native Land Court which awarded land interest to individuals rather than to all of the tribe excluding many North Island Ngati Apa from ownership of the tribal reserve lands. The Crown’s failure to ensure that the arrangements recorded in the 1849 deeds were given effect was a breach of the Treaty of Waitangi and its principles. 
Over 100000 acres of land in which North Island Ngati Apa held interest was subject to native land laws introduced in the 1860s in addition to reserves from the Rangitikei-Turakina purchase. The operation and impact of the native land laws in particular the awarding of land to individual North Island Ngati Apa rather than to iwi or hapu made the lands that North Island Ngati Apa were able to retain more susceptible to partition fragmentation and alienation. A lot of that alienation was orchestrated in quite an interesting way with people being bought out and pandered to and this contributed to the erosion of the traditional tribal structures of North Island Ngati Apa which are based on collective tribal and hapu custodianship of land. The Crown failed to take steps to adequately protect those structures. This had a prejudicial effect on North Island Ngati Apa and was a breach of the Treaty of Waitangi and its principles. 
We came forward as a nation and the purpose of this bill—which is stated to bind the Crown which is really important—is to record the acknowledgments and the apology offered by the Crown to North Island Ngati Apa in the deed of settlement dated 8 October 2008. It was signed by the Minister in charge of Treaty of Waitangi Negotiations the Hon Dr Michael Cullen; by me as the Minister of Maori Affairs; and by the Associate Minister in charge of Treaty of Waitangi Negotiations. 
I need to mention Lillian Ruihi Manawaroa Te Aweawe Ropata Te Hina—Bob Te Hina—Arikihanara Mare Mare and Mariana Shenton who are all four of North Island Ngati Apa. The bill gives effect to certain provisions of the deed of settlement which is a deed that settles the North Island Ngati Apa historical claims. That is why we support this bill because we certainly have our fingerprints and effort all over it. 
The apology is explicit: “The Crown recognises the efforts and struggles of the ancestors of Ngati Apa (North Island) in pursuit of their claims for justice and redress from the Crown and makes this apology to Ngati Apa (North Island) and their descendants.” It is an easy reminder in relation to 100 years; it is a long time coming. It states: “The Crown profoundly regrets and unreservedly apologises to Ngati Apa (North Island) … Accordingly with this apology the Crown seeks to atone for its past wrongs begin the process of healing and make a significant step towards rebuilding a lasting relationship based on mutual trust and cooperation with Ngati Apa (North Island).” 
I can recall when we went to the marae to sign the first lot of documents. The old people—and there was still a bit of tension—welcomed us with open arms and they were certainly more than respectful. It was a real enjoyment to see the celebration and the humbleness of those people. One could certainly understand the effort that had gone in from the young group. 
The cultural redress is quite clear: “protocols to be issued to the trustees by the Minister of Conservation the Minister of Fisheries and the Minister for Arts Culture and Heritage; and an acknowledgement by the Crown of the statements made by Ngati Apa (North Island) of their cultural spiritual historical and traditional association with 9 statutory areas … the vesting in the trustees of the fee simple estate in 17 cultural redress properties and subsequent management arrangements in relation to various sites; and the alteration of place names.” 
The alteration of place names was very very important for them because in some of the areas and sites of significance one of the key issues was how people had taken away the mana of the people by renaming places with some far-flung value from overseas and ignoring what was really Ngati Apa’s. 
Mita Ririnui said in his speech the last time we discussed this bill that it was incredible that the young people of Ngati Apa could bring this settlement to the House without too many problems. I can say that the problems they had were handled very well. They were more than capable which shows us how young people can bring this to the fold. 
Hon SHANE JONES (Labour) 
: 
 A kia ora ano tatou tenei huihuinga o tatou i roto i to tatou Whare i a tatou e whakatata ana ki te paunga o tenei tau e wha e rima e ono pea ra e toe ana katahi ka tutuki nga mahi i whakaritea hei korerotanga ma nga kaitorangapu i roto i to tatou Whare i tenei tau. Na reira me mihi atu au ki a tatou ta te mea kahore pea he take rahi atu pai atu i tenei hei korerotanga mau tatou i te toenga o tenei tau ta te mea ko ta tatou e mahi nei i teneki po he whakawhiwhi atu i nga uri o nga kaumatua me nga tupuna no ratou enei taonga i te tuatahi katahi ka whakakorea na eke rawa ki te wa e noho nei tatou e whakahoki ana ki a ratou. Na reira kati enei korero ki to tatou reo Maori. he wahanga pea e toe ana na ka hoki mai ano ahau. Kia ora tatou katoa. 
[ 
Greetings once again to us this assemblage in this House of ours as this year draws to a close with about 4 5 or 6 days remaining when the politicians in our House complete what has been set down for us to achieve this year. So I need to acknowledge us because there is no issue greater or better then this one for us to debate in what is left of the year because the task before us tonight is to deliver these resources to them descendants of the elders and ancestors who owned them originally but had them confiscated. The situation prevails to our time today as we consider their return. Insofar as saying something in our mother tongue is concerned this is sufficient for now. Should a part remain later I will come back again in our Maori language. Thank you all 
.] 
I join my colleagues in supporting the Ngati Apa (North Island) Claims Settlement Bill. Ngati Apa are not only located in this part of Aotearoa that we are talking about they also are part of the Kurahaupo waka confederation and an element of that confederation moved into Te Wai Pounamu. There was a time when the iwi Ngati Tu Mata Kokiri if my memory serves me correctly were the tangata whenua in that portion of Te Tau Ihu o te Waka. Not only did Ngati Toa and elements from the Tainui waka go into that area but part of Ngati Apa as well. Good news has been visited upon the Ngati Apa of that area. One of their great leaders the whaea the kuia Kath Hemi had the ability to whakapapa not only to Ngati Kuia but to Ngati Apa and I dare say to Rangitane. 
I recite this history because in this part of Aotearoa there has been a dispersion of iwi and hapu partly as a result of colonisation but also pressures as a result of inter-iwi dynamics and some went to Te Wai Pounamu. To mention the name Ngati Apa down there is to invite a rather hefty response from Sir Tipene O’Regan as to where the Ngai Tahu boundary exists but that is for another discussion. 
This is also the people of Tariana Turia and I acknowledge her this evening. No doubt she has played a key role in ensuring that these claims in particular the ones from this area are not overshadowed by the more obstreperous iwi. I include my own Ngapuhi nui tonu iwi and that of my colleague Mr Parekura Horomia Ngati Porou. We tend to try to crowd out the space of people who have a somewhat more reserved approach to these matters. One may not believe it but I do have that view about Tariana Turia. No doubt she is reserving as to whom she will visit her favours upon post-2011. 
But let me come back to this bill. This bill enables the transfer of property and resources back to the tangata whenua. I just saw that one of the properties of great interest no doubt to Simon Power is the Marton golf course. Only a cursory view of recent Treaty-based history would tell us that there have been some dreadful rows about golf courses in Aotearoa. Indeed today I heard the daughter of Eva Rickard—Angeline Grensill the academic at Waikato University. As I heard her voice I could hear the strength of her mother the woman who in the late 1970s stared down Mr Muldoon over a golf course and also assembled a motley bunch of university students and various other fellow travellers who were interested in reviving interest in our language culture and land rights. It is good to know that that was eventually settled. I might be slightly ill-informed on whether the Marton golf course has created a similar level of disharmony but I doubt it very much. 
Not far from there is an area where one of the great kuia rangatira of Te Ao Maori was born. Her name was Mere Rikiriki. She had the whakapapa of these people. Members from that part of Aotearoa including the current member for Whanganui would know of her name. She was reputed to have predicted the emergence of the great Maori leader from Ngati Apa and similar tribes Wiremu Tahupotiki Ratana. I say that because when we are offering reserves the underlying title to golf courses land that has an economic value in terms of its afforestation and the rentals associated with growing trees on that land we must never forget that the landscape derives a lot of its meaning for the local Maori when they are able to recite the names of the hapu and the tupuna because it is an ancient Maori belief that to recite or to utter the name is to invoke the presence. As they say: “He mana ano to te kupu he mana ano to te ingoa”. 
So although there are neighbouring claims that have not been settled and they are on a slower trajectory it is good that we can join and move forward on this issue. There will not be an immediate bonanza there will not be an immediate El Dorado from these kinds of lands but it satisfies a part of the Maori personality and the Crown’s honour that we do the best we can at a given point in time and do it with honesty and sincerity and are willing to stand up and be counted. It is easy to lambast deals of this nature: that it is an insufficient quantum it is an inadequate response. But in all of these Maori Treaty-based initiatives that we are pursuing in this decade we rely on the goodwill of the people on both sides. If we move too far away from having either the ability or the sight to foster ongoing goodwill then we lose the mandate or we lose the legitimacy within the public to continue with this work. 
It is good that the two main parties supported by other parliamentary parties etc. are able to say that these lands are being restored. Indeed some of them will be administered by local government. I fail to see why my own relations in the far north and indeed my very good friend the Mayor of Far North District Council are not able to explore with the Minister for Treaty of Waitangi Negotiations whether that represents a remedy to the ongoing wrangles in that lovely seaside village otherwise known as Taipa. The name Taipa comes from the fact that wherever one touched there was a great deal of seafood although Auckland is about to invade my area over the next 2 or 3 weeks so I fear the seafood may take a bit of a hammering. However Labour will be back by the end of next year and the seafood will be restored—kina paua koura mataitai kai moana—all sorts of different delicacies. 
Rahui Katene 
: Kutae. 
Hon SHANE JONES 
: Kutae yes. As is always the case it is a challenge to define whom one is settling with. But those rules and the role of defining who the members of Ngati Apa are lie with their runanga. The Crown has observed a set of constitutional thresholds and it really is a responsibility that has to lie with the hapu and the runanga as opposed to us following some sort of North American model where an entitled family might be a fraction of this and a fraction of that. In fact I have met a whole host of descendants of the original Native American tribes and they give their blood quantum in fractions. I perish the thought: one day I am going to have a mokopuna because my daughter is about to get married and the fellow she is marrying is a little bit Portuguese a bit Spanish and a bit Maori. My daughter is a bit Dalmatian a bit Welsh and a bit Maori. So we have not gone for that approach; we have gone for this very expansive view that those who are members of the hapu are accepted by the local people and have the ability to attest that they whakapapa back to the original tupuna can then claim to be Maori. If the group they purport to belong to decides that someone is not living up to their name or that their zest for consuming the rights that that whakapapa might give them are not up to speed then they will be told off. Kia ora tatou. 
CHRIS TREMAIN (National—Napier) 
: 
 Whakataka te hau ki te uru whakataka te hau ki te tonga kia makinakina ki uta kia mataratara ki tai. E hi ake ana te atakura he tio he huka he hauhunga. Tena koutou ki te Whare. 
[ 
Cease the winds from the west cease the winds from the south let the breezes blow over the land let the breezes blow over the ocean. Let the red-tipped dawn come with a sharpened air a touch of frost a promise of a glorious day. Greetings to you the House 
.]  
I started with that whakatauki in response to the Hon Parekura Horomia’s comments that there has been a slow number of settlements under this new Government. The reason I used that whakatauki is that it talks about a red-tipped dawn coming across the nation. 
Hon Parekura Horomia 
: Ah red! We like the colour red. 
CHRIS TREMAIN 
: Ha ha! It talks of the promise of a new day and that is what we are seeing under this Government. Although the Hon Parekura Horomia sits on the other side and says there have not been many settlements under this Government he is quite clearly incorrect. Under the previous Labour Government we saw a mere 1.6 settlements per annum over 9 years. 
Chester Borrows 
: Repeat. 
CHRIS TREMAIN 
: There were 1.6 settlements. Under this Government we have achieved 10 settlements in just 2 short years. I do not pretend to be a mathematician of any ilk but I simply divide 10 by two and come up with five. Perhaps I am wrong but I suggest that five settlements per year are quite a bit more than 1.6 settlements. On any count we are well ahead of the previous Government in terms of settlements. 
Hon Parekura Horomia 
: When did they start? 
CHRIS TREMAIN 
: It is not about when they start my friend. It is when they finish. It is not about whether you set out to climb the Himalayas and reach Mount Everest; it is whether you climb them; whether you “knocked the bastard off”. Actually we are knocking those bastards off and doing it one by one. We have done 10 over 2 years or five per annum. Ngati Apa is another one— 
Hon Shane Jones 
: I raise a point of order Mr Chairperson. It is about the term “bastard”. I have a great deal of admiration for that man given his fortitude for playing second place to Parekura Horomia’s cousin Hekia but we do not use the word “poriro” on the marae and we ought not to use “bastard” in the Chamber. 
The CHAIRPERSON (Hon Rick Barker) 
: I just say to the member that I thought the word was used in the context of a very well-known quote from a famous New Zealand icon. It is part of the New Zealand vernacular. It is also a word about legitimacy or not so it is not offensive in itself. I did not think that the member was using the word in an offensive manner. He was using it I thought in a colloquial manner and the Chair certainly did not take any particular offence. I invite Chris Tremain to continue. 
CHRIS TREMAIN 
: Thank you Mr Chair. It was certainly not meant in any manner that would offend. It was used to clarify exactly what members on this side are achieving in terms of settlements. We believe that settlements are an important part of moving this nation forward. It is a bit like the way that Parekura Horomia moved forward on Saturday last week in the Iron Maori. I should bring to members’ attention his achievements when he took part in the Iron Maori in Ahuriri this week. It was a half-marathon. I am not sure how many laps he did but when we are talking about settlements and taonga I am surprised he is not a taonga that is still left out on the racecourse my friend. 
Hon Parekura Horomia 
: I didn’t see you. 
CHRIS TREMAIN 
: I was there. It was great to be there. 
Hon Parekura Horomia 
: You must have been behind me. 
CHRIS TREMAIN 
: I would not have been able to keep pace with the member. 
The point I make is that the Ngati Apa (North Island) Claims Settlement Bill is wonderful legislation. We are proud to be bringing it to the House and proud to be making significant gains for Maori in this country. Settlements are important and in closing I make the point that a number of Pakeha wave their hands and say we have settled too much or spent too much on making these settlements happen. If we look at it in the wider context we have spent less on the settlement process to date than I understand may have been spent on the South Canterbury Finance claim. The point I want to make clear is that this legislation is empowering Maori to be part of the wealth-creating engine of this economy. The more we can do that and the more that iwi and hapu are part of that economy the more they will lift themselves off the deck in terms of the statistics that we all decry. I think Parekura Horomia would join me as would Shane Jones in that sense. The more we can lift that aspiration the more we can make Maori part of the wealth-creating engine of this economy through settlements through wealth creation the better this nation will be. I will close with the example of Whale Watch Kaikoura and what that community has achieved through a settlement process that has empowered that community. Thank you very much. 
Hon PAREKURA HOROMIA (Labour—Ikaroa-Rawhiti) 
: 
 I did well in the Iron Maori; I did the 21 kilometres. But I did not see the previous speaker Chris Tremain. 
I join with Chris Tremain and commend the Minister for Treaty of Waitangi Negotiations for doing 10 settlements in 2 years. I also commend Dr Cullen and myself for setting the platform over 10 years to make sure that this Government had 16 claims that it could quite simply finish off. We have done all the hard work and it is wonderful. 
I see the Minister in the chair the Hon Wayne Mapp passing notes to Chris Tremain. That is not the role of the whip; it is supposed to happen the other way. That is what this settlement is about—an interchange of notes. It is about transactions that people never stuck to. There were people from the Crown handing notes to the purchasers—Mr Spain and the other fellow. They went around the country buying up the land. They said one thing and did another. 
As my colleague Shane Jones said earlier in the early 20th century many Ngati Apa were attracted to spiritual leaders and movements. The first of these leaders was the North Island Ngati Apa spiritual leader and prophetess Mere Rikiriki. She was well known. Her followers showed concerns about their loss of land and mana. Following the First World War many of the Ngati Apa were also drawn to the spiritual and political leader Tahupotiki Wiremu Ratana whose tribal origins included Ngati Apa. From the early 1920s the Ratana movement grew. The point is that Ngati Apa have stood the test of time with humility recognising that the deal had not been done properly. 
In the interchange of notes it is very interesting to see that the rangatira Aperahama Tipae was most indignant from the outset at the transactions of Mr Spain and the other purchasers who came in and talked about giving $1000 for so many acres but then trebled the size of the purchase. Some indecent things were done. He was indignant that he had not been consulted during previous attempts to purchase land. It is very very interesting. He negotiated hard with Ngati Apa to secure their consent to the Whanganui purchase in return for a small share of the payment that Mr Spain had recommended he make to Maori for their lands. It was fascinating because Aperahama Tipae said that the land was barren of Pakeha these new people and he wanted his house to be filled by all these new people who came off the boat—pale-skinned people. He was very very keen to have them come into his house which was his lands. He was of the view that if he got these people in he could mirror the success that he watched being built around him. It was a bit like those issues that are akin to the Kingitanga. 
I suppose what is important as the previous speaker mentioned is that it is wonderful to get to this point in time. The issue is that it is not a competition and certainly I hope we are not professing that this is about only accelerating or praising the economic position of Maori and building it on Treaty settlements. The Treaty settlement will never correct replace or build up what was taken. I am really pleased that that member noted that. We do hear of these people some of whom we know as kaki whero in this country but most New Zealanders are reasonably decent. They know when a wrong was done and they want to put it right. That is what I want to commend Mr Tremain for. At the end of the day this settlement will not correct all of those wrongs that were done but at least this is an attempt to take it forward. 
If we believe that there is not enough money—because it seems to be it is with this damn money which is used to correct those things where we impinge the Maori people as the Crown impinged the Maori people’s mana—then we have got something wrong. There has always been a fascinating differentiation between mana and moni. Some people have made out that they are talking about mana and really they are after moni. That happened with money in the early days. A lot of people promise a lot of money for a lot of mana but it did not work out. 
I am fascinated and I thank that member for reminding me about how we found $1.75 billion like that in a very short time to correct a lot of reckless gambling. But I wonder at times. Women were screaming at me on Saturday about Maori being mad bad and sad and that all they do is go to the TAB and play housie—those sorts of people are nutters. Thank goodness the average New Zealander is not like that. I wonder whether every Maori or every Pakeha for that matter who went to the TAB or to housie got their money repaid because they invested it recklessly. I say thank you to Mr Tremain. I really admire him for bringing up the $1.75 billion. 
Chris Tremain 
: $1.5 billion. 
Hon PAREKURA HOROMIA 
: No it was $1.75 billion. You see this is a distortion of the figures again—Pakeha to Maori. That is terrible! I know it was $1.75 billion but that member says it was $1.5 billion. It is still alive and well! Shame on that member! It is still alive! 
I am encouraged by that member. He recognised that I did the Iron Maori. There were 764 Maori who decided to swim for 2 hours bike for 90 kilometres and some brave souls walked 21 kilometres. What was that about? It was about participation. 
Craig Foss 
: You did a victory lap. 
Hon PAREKURA HOROMIA 
: I say to Mr Foss that I was there; he knows that. I was trudging along. I held my head up high and I went down the track. That member knows that. Where was that member? 
I am encouraged by what Mr Tremain said. I am pleased that the Raupunga settlement is getting very close. On 22 December the deed will be done. I look forward to Mr Tremain ensuring that the Ahuriri settlement is done that the Tamaki-nui-a-Rua settlement is done and those out at Hineuru and Waikaremoana. I look forward to that. 
I encourage Mr Tremain to continually talk to the Minister for Treaty of Waitangi Negotiations. He is not a bad joker actually. He will get there. He has a lot to learn but he has a reasonable nature and he was kind enough to invite us along to settlement sign-offs. But it is like anything else. The beginning is the most difficult and the middle part is more difficult as my friend from Whanganui knows. There are all these ups and downs and tensions and we get all this make-believe—the people who do well out of it are the legal advisers. But getting towards the end of a settlement is something that we should share and celebrate. I commend the Minister for that. 
Mr Tremain who is a mathematical wizard has made me understand that it is $1.5 billion—I do not know how he gets $1.5 billion for a Treaty settlement but they have done five in the last 2 years. I want him to remember that there have been 9 to 10 hard years spent negotiating at the top end pushing things around and getting it into a box where he is easily able to push it along a bit sign it off and be thanked and have praise heaped upon him and be told that he is the man because he has done all of this by himself. 
But you see Maori are not fools. They know what is going on. They know that more than 100 years is a long time to wait but that they will get there. Mere Rikiriki Wiremu Ratana and all of those great people are remembered at this time as are the older people who handed over to the young people to get this settlement. Minister Turia’s son was one of the key people in this as was Andre and the group of women who were there. They did a great job of this with a great Government at the time and they have certainly helped this Minister forward to get to a better place. 
Along with Mr Tremain I am looking forward to the Ahuriri settlement so that when I do the next 21 kilometre walk next year along with him and him swimming I will know that Maori own the land. That will be wonderful. It will be great to walk on land where the tupuna and kuia used to do that. They used to fish when the waters were clean and make sure that the food reserves were full. That this Government will replenish and replace that is certainly something to look forward to. 
Craig Foss 
: The earthquake mucked up the fishing. 
Hon PAREKURA HOROMIA 
: Mr Foss talks about the earthquake. He would not know an earthquake even if he visited one. 
Hon Shane Jones 
: Fiscal earthquake. 
Hon PAREKURA HOROMIA 
: It is a fiscal earthquake. That is the fiscal report I say to Mr Foss. That is why he is still on that side of the Chamber and my cousin is on the second bench. I commend my cousin Hekia Parata for becoming a Minister. She is my close cousin. The one thing in Maoridom is that we cannot deny our genealogy. Some Pakeha try to hide it away. We have got rangatira—chiefly kingly status. 
Hon Dr WAYNE MAPP (Minister of Defence) 
: 
 I think it is appropriate that on behalf of the Minister for Treaty of Waitangi Negotiations who is not able to be here tonight I take a call during the Committee stage of the Ngati Apa (North Island) Claims Settlement Bill. We have heard a lot of rhetoric across the Chamber and as we get close to Christmas that is probably appropriate because it is a sharing in a good-humoured and good-natured way of credit and claims and there is a sense of dare I say it ownership of this particular settlement. 
It is worth putting some of these things in context. As we all know in this Chamber we have been dealing with settlements effectively since 1995—specifically the Tainui settlement and the fisheries settlement. Mr Tremain said that the total payout for South Canterbury Finance of $1.75 billion is greater than the settlements over that 15-year period. It would be very close indeed. I think that it is worth our giving pause for thought. If we look at it in terms of annual amounts in 15 years the total amount we have paid in settlements is approximately $100 million a year. That is out of annual expenditure by the Crown of $60 billion on behalf of its citizens. So we are talking about a small amount of money relatively. 
What we are really doing here tonight is restoring mana and dignity. It is important for iwi—North Island Ngati Apa along with all other iwi who have claims—that we recognise their role as iwi rather than as individuals. Young people in particular who might in many instances be alienated or feel a sense of dispossession will themselves gain something if they know that their people have a sense of empowerment. I have been listening to the debate. In particular both Mr Tremain and Mr Jones emphasised the importance of settlements being a springboard to development. It is not so much the settlement itself that does that but the sense of empowerment; it is the ability to move beyond the past that matters. 
I refer to one part of the preamble—in fact the very last sentence of the preamble. It states: “Today Ngati Apa (North Island) own less than 1% of their traditional lands:”. Reading that one might think this must have been a massive raupatu but it was not like that in fact. It was a series of incremental measures taken over 100 years that led to dispossession. That has led to a deep sense of grievance which we are settling today. In fact the amount of money is perhaps not that important—$16 million is not a large sum of money. There is some cultural redress there is some transfer of land but it is largely symbolic. What really matters here is the sense of empowerment for iwi and the ability to move into the future. 
It is easy I guess for different parties to claim credit and it is right that we do but I think that 2 weeks from Christmas we should think of those things that actually unite the major parties in the House in particular. I think it is also appropriate to recognise the specific role here of the Hon Tariana Turia—in part it is her people who are being recognised—and the role of Ratana. 
This is only one of many settlements. There will be more to come. But at some point in the future of New Zealand—it maybe a few years away yet and it might not be achieved as quickly as one might like—we are going to be able to say that we were able as a nation to move past the past; we will remember the past but it will not weigh on us and it will not be a burden of grievance. There will be a sense of memory and the ability of people to progress. That is really the context of the settlement. 
The bill’s preamble is very important. Having history written in statute matters because it is enduring and it is there as a testament. It is the Crown recognising the past and then settling with the people to enable them to have a sense of purpose for the future. We all wish that the future of the rangatahi of Ngati Apa will not be blighted by the sense of grievance that their tupuna have suffered. 
Hon SHANE JONES (Labour) 
: 
 I follow on from my senior colleague Parekura Horomia. I want other members of the Committee in particular those on the Government benches to note that there is a bicycle in Napier that bears testimony to Parekura’s attempt to deliver the goods. That bicycle could actually be used to uplift the ebbing prospects of the Prime Minister’s cycleway. When Parekura says that he was the Ironman it is very churlish of Mr Foss and others to deprecate his contribution. 
In terms of what Dr Mapp has said I will take us to the actual preamble to the Ngati Apa (North Island) Claims Settlement Bill. The preamble is really a narrative of bicultural history and colonial history in that part of the country. A name that looms large in this narrative is the name of Donald McLean. Donald McLean amongst other things was responsible for the promotion of the four Maori seats and the creation of Maori representation which is being unwisely undermined by our colleagues in the ACT Party. But that is another matter; those members are not long for this world. Donald McLean’s role in relation to this bill shows how one single individual was extraordinarily influential and not only in areas such as Ngati Kahungunu. One day a Government of the future will get to the claims of Hawke’s Bay and that Government will find that Donald McLean the Crown’s commissioner was very influential there in acquiring on behalf of the Crown vast tracts of land. It is evidenced that he did a similar thing here. 
Also represented in this narrative is the story of the Kohimarama Conference. These are largely obscure events and that is an indictment on social studies or whatever the heck it is called these days in the education system which is diminishing by the day as a consequence of the delinquency from the current Minister of Education. But that is another matter; we leave the small task of correcting her excesses to Dr Pita Sharples and we will hold him responsible in the event that a single further Maori family suffers which they no doubt will as a consequence of her delinquency or his dilatory approach. 
I come back to the essence of this bill. Although it is about our families etc. it is also about the key contributions that significant figures in colonial history have made. In a limited sense they probably thought they were actually improving matters. Indeed there is a reference where Donald McLean expresses inordinate surprise that Commissioner Spain had not reported that Ngati Apa had considerable interests in the Whanganui block. The name Spain features large in the history of Maori land transactions and indeed the man was even active in the north; I fear he had something to do with Taipa which continues to bedevil my relations and Pakeha neighbours and a few of my Maori whanaunga as well. He was actually involved in the first Land Claims Commission so for people who fear that the Waitangi Tribunal is a recent innovation that is blighting the country and ask why it all cannot just go away—unfortunately they never will—they ought to read what actually happened in the 1840s. 
One of the first things that happened was that there was an old Land Claims Commission. Some of the characters in this narrative sat on that claims commission. That was when the first land claims were investigated. Of course they looked at the blocks of land that had been acquired prior to the passing of the Treaty of Waitangi and they ascertained what particular blocks of land ought to stay with either the inheritors or the individuals who believed that they had bought vast swathes of the country from the tupuna the rangatira and the tribes. 
It is quite extraordinary that only small amounts of land remain available for the purpose of restoration back to Ngati Apa but it is a salutary lesson that the debts of history continue to—“haunt” is too strong a word—challenge modern generations of New Zealanders. 
What is particularly important about this bill is that although the amount of money may be small an important resource is being restored in terms of the land that is capable of being afforested. We are going through a growth phase of earnings associated with forestry. In all honesty I am only disappointed more Maori land in this particular area or other areas has not been afforested. If there is any money left in the Crown Forestry Rental Trust one day I look forward to hearing that such moneys might be dedicated to such a purpose. 
When these settlements are eventually implemented it is important not only that the Crown continue to work with the runanga but that the Crown with the runanga of the day start to focus on the units within Maoridom that really make all the difference: the families. If the families of Ngati Apa are concentrated on by the Crown as it works with the runanga to develop new initiatives and policies then the kinds of problems the current Minister for Social Development and Employment is endeavouring to deal with will be helped. 
I must say I welcome Paula Bennett back to the Whare Paremata. I was not one of the Maori men who were critical of her when she said that it was about time the leaders of the runanga and the incorporations started owning more of the problems and generating the solutions to the dramas that affect our young—not necessarily our kids but our young teenagers. All of the work of a runanga will fail if we continue to allow these negative statistics which particularly blight our young men to race away on us. This may be only a rare occasion on which I am offering such charitable thoughts towards the member for Waitakere but I welcome her back. I will hear of her on Radio Live where no doubt we will learn more about how Sarah Palin gave her geography lessons. 
Hon Paula Bennett 
: Actually it was Helen Clark. 
Hon SHANE JONES 
: OK she did not just drink tea while she was over there; she learnt the full meaning of the name Tea Party. 
I come back to the bill. A host of sites are in here and I see that not only local government but the Department of Conservation has ongoing responsibilities. We need to ensure in the future that State agencies such as the Department of Conservation are adequately funded to address those obligations. We need always to be very careful when we implement these settlements that we do not unwittingly introduce too much red tape. When people want to use the resources to create jobs and develop investment etc. we have to address environmental interests but Maori runanga and investors themselves will be very quick to complain if as a consequence of the implementation of the settlements in association with the Department of Conservation and local government we get new layers of unnecessary complexity. 
I reflected on that concern when we discussed matters to do with the Waikato River. Indeed it is coming thick and fast over the Marine and Coastal Area (Takutai Moana) Bill which will be a test with regard to whether Maori can have any faith in the current governing coalition. Although Labour members are prepared unreservedly to support this particular bill we are deeply concerned by the ongoing negativity that flows out of the select committees etc. and indeed by some of the extraordinary utterances coming from the Minister for Treaty of Waitangi Negotiations. He may be exasperated that people feel that Vikings Phoenicians and other sorts of lost Europeans were floating around the Pacific but it is probably not constructive to describe them all as clowns. I recall Doug Graham calling Hugh Barr a clown. Unfortunately for current politicians Doug Graham is gone and Hugh Barr is still here. That might say that Hugh Barr is on some sort of elixir. We seem to float through this House and eventually move on but the likes of Hugh Barr I think has a role in the seabed and foreshore legislation that is inversely related to his ability to be constructive or to help solve these issues. It is disappointing that he is a chorus for the ACT Party. Kia ora tatou. 
The question was put that the amendments set out on Supplementary Order Paper 168 in the name of the Hon Christopher Finlayson be agreed to. 
Amendments agreed to. 
Preamble clauses 1 and 2 Parts 1 to 3 and schedules 1 and 2 as amended agreed to. 
Bill reported with amendment. 
Report adopted. 
Taxation (Tax Administration and Remedial Matters) Bill 
First Reading 
Hon PETER DUNNE (Minister of Revenue) 
: 
 I move  
That the Taxation (Tax Administration and Remedial Matters) Bill be now read a first time. 
Grant Robertson 
: Is it the right speech? 
Hon PETER DUNNE 
: I can assure Mr Robertson I have checked the drafts very thoroughly. This is the right speech for the right occasion and it will be worth listening to. At the end of this debate I will recommend to the House that this bill be referred to the Finance and Expenditure Committee for consideration. 
This bill continues what has been a very important year for tax reform a year that has ushered in a package of measures promoting economic growth integrity and fairness in the tax system. The key focus of the Taxation (Tax Administration and Remedial Matters) Bill is on efficiency and on reducing compliance costs. Reducing tax compliance costs is something that every Government and every Minister talks about but it is something we have to work at constantly to stimulate the New Zealand economy and to encourage investment. 
One of the measures this bill contains is the abolition of gift duty. I first raised the prospect of the abolition of gift duty in June of this year. Following a consultation process I am delighted that this bill gives effect to that decision. Gift duty no longer raises any significant revenue and imposes significant compliance costs on taxpayers. It is well past its use-by date and I am delighted that the announcement of its pending abolition has already been widely welcomed by taxpayers. Gift duty is a tax that currently produces about $1.5 million in revenue. It directly costs the Inland Revenue Department about half a million dollars to collect and is estimated to cost about $70 million in compliance costs. Under any reasonable assessment it does not add up and so its abolition is long overdue. 
The bill makes changes to the tax disputes process and I am delighted that there has been generally strong support for the proposed changes to the procedural rules that we are making regarding the tax dispute process along with some administrative changes to the process. The Inland Revenue Department manages this system through a process of significant public consultation and dialogue with key stakeholders in the matter and I am confident that the measures contained in this bill will make for a more streamlined process for all concerned. 
The bill introduces changes to the tax administration rules to relax secrecy provisions under specific criteria. The changes being contemplated in this legislation will provide better value for money across the Public Service with improved speed accuracy and certainty of information through wider use of Inland Revenue Department information. Currently the tax secrecy provisions are so tight that they actually prevent the Inland Revenue Department providing better customer service. Providing the Inland Revenue Department with greater ability to provide information will enable us to improve efficiency in the Public Service provide a better customer service and efficiently operate the tax system. This bill introduces measures that give effect to all those requirements. 
Changes to the tax information-sharing and secrecy provisions in the bill will allow the Inland Revenue Department to share information with other Government agencies for specific purposes and under specific criteria—for example to prevent abuse of the social assistance system. 
Under the current rules it is unclear whether the Inland Revenue Department can accept the assistance of a relative or a friend helping a taxpayer who is a non - English speaker or who has hearing difficulties even if the taxpayer has given his or her permission to be helped. This bill seeks to tidy up those sorts of anomalies. The tax system fundamentally relies on the ability of taxpayers to trust the Inland Revenue Department with the information they provide. 
The changes to the secrecy provisions are therefore being proposed only under very carefully prescribed criteria. In addition the bill clarifies the use of money interest rules that apply to underpayments of tax to retrospectively give taxpayers greater certainty that this interest is in fact deductible for income tax purposes. 
The remaining items in the bill such as enhancements to the tax pooling rules and technical changes to the portfolio investment entity rules are mainly remedial in nature to ensure that those respective rules work as intended. 
This is a brief description of some of the main features of the bill. For a more complete discussion of the proposals I refer members to the separate explanatory note of the bill which describes the changes in detail and which has been separately distributed to members. 
Overall this bill will continue the focus on positioning the New Zealand economy well for future economic growth and for a world-class tax system. I therefore with pleasure commend the Taxation (Tax Administration and Remedial Matters) Bill to the House. 
Hon DAVID CUNLIFFE (Labour—New Lynn) 
: 
 I thank the Minister of Revenue and I rise to oppose the Taxation (Tax Administration and Remedial Matters) Bill. I do not oppose the bill because of its provisions on tax secrecy. I do not oppose the bill because of the new privacy framework. I do not oppose the bill because of tax pooling and I do not oppose the changes to donee status. But Labour most definitely opposes the change to abolish gift duty. We do so because politics is about priorities and this is one more little straw that is in danger of breaking the camel’s back of the nation’s fiscal balance. This abolition of gift duty is not a matter of $70 million or $100 million. The reason that gifting-tax avoidance is limited to that small amount of money is precisely because rules exist. If the Minister removes the rules I say to him that he will watch a mushrooming of avoidance structures just as have occurred under loss attributing qualifying companies and under trusts. 
It used to be the case that the once-proud National Party campaigned on the basis of personal responsibility. I call upon the House and listeners out there to think just for a moment about what personal responsibility means in a time of recession. New Zealanders around the country are doing it tough. God knows that West Coasters have been doing it tough! Cantabrians have been doing it tough. But in my electorate of New Lynn small businesses retailers and employers are doing it tough. In a recent poll one in four New Zealand families said they were worried about losing the roof over their heads. We know from statistics released in the last 2 days from Statistics New Zealand and Treasury that the average household family income has gone backwards by $30 a week in the last year—by $18 for the average salary of an individual. Against that background of real suffering I call upon the Government to walk the talk on personal responsibility and personal responsibility in the tax sphere means that everybody pays their fair share. Everybody pays their fair share. 
There is no room for any form of legitimised avoidance in times of recession when New Zealanders are fearful of not being able to keep the roof over their heads put food on the table pay National’s extra GST or get by. They do not want to be told that only half of the top hundred taxpayers are on the top tax rate which is what the Inland Revenue Department told the Tax Working Group. They do not want to be told that after two rounds of tax cuts that have overwhelmingly benefited the well-off—by cutting the top tax rate firstly from 39c to 38c and then by cutting it all the way to 33c—42 percent of the tax remission went to the top 10 percent of earners. New Zealanders do not need yet another gift to the better-off. Politics is about priorities and sometimes it is the little things that matter. Sometimes it is the little things that people out there can grab on to and get their heads around and say “Ah ha! Now I understand what this Government is really about. Now I understand the difference between National the party of the few and Labour the party of the many.” Labour opposes this bill because this bill is a bill for the few. 
Chris Tremain 
: Party of the many—that’s rubbish! 
Hon DAVID CUNLIFFE 
: The member may laugh but this is a bill for the plutocrats of Remuera who want to gift their equity to little Johnny or little Jane—someone who by the way might just have a lower tax rate than mummy or daddy. Those are the issues. 
It may be the case that there are perfectly legitimate reasons for gifting. Labour is not saying that anybody who indulges in gifting is avoiding tax—members should not misread me in that. There are perfectly legitimate reasons for gifting. But as of today it is possible to gift tax-free up to a threshold of $27000 per annum which is enough for most families. It is enough for most people. But it is not enough for the National Party because its constituencies demand the right to gift more than $27000 per annum per man woman and child because such is the burden of income to be spread. 
Well that should not be in these tough times. If it is good enough for ordinary Kiwi families to be told to pull in their belts then it is good enough for the Government to put up legislation that reflects the needs of hard-working New Zealand families. That is why our leader was talking yesterday about the squeezed middle the hard-working New Zealanders who are just well-off enough not to qualify for anything in the benefit or welfare systems. They have jobs. They are plumbers they are secretaries they are technicians and they may be taxi drivers—the squeezed middle—and this bill does not help them. This legislation is not a priority for the middle because those people do not have a spare $20000 each to give away each year. 
I ask the chief Government whip: $27000 of post-tax income is how much pre-tax income? Is that too much maths for him? The answer is that it depends on the tax rate. I thought the whip might buy into that one but no strange silence broke out on the Government benches when members were confronted with such a piece of mathematics. Dr Paul Hutchison the highly qualified representative of the medical sector is there looking at me and grinning because he knew the answer but he was not going to tell the chief whip—they can sort that out later. 
Labour will look forward to hearing the submissions on this bill and we hope to hear from a large number of ordinary New Zealanders who will want to express their views about whether the abolition of gift duty really is a priority for tax reform. It will go down as one of those little emblems one of those little tokens one of those little moments of truth at a time when the recovery is not happening and people are wondering about their futures. They will hang on to this and say “Goodness me! Wasn’t it enough to have two rounds of tax cuts for the well-off? Wasn’t it enough to take the top tax rate all the way down from 39c to 33c? Wasn’t it enough to give two-thirds of the money to one-third of the people? Wasn’t it enough to give 30 percent of the money to the top 5 percent?”. No it was not; we are going to make it easier then for them to gift their winnings to little Johnny who happens to be on a lower tax rate than mum and dad. 
This is what Labour would do. It is that time in the cycle when the public wants to know what Labour would do. Labour would not abolish gift duties. Labour would crack down on avoidance. Labour would hack into the $2.3 billion per annum of losses on loss attributing qualifying companies alone and Labour would ring-fence loss attributing qualifying companies. Labour would ring-fence loss attributing qualifying companies. There is no reason why the losses on a company should be written off against personal income. It is fair enough to carry them forward to future profits. It is fair enough to allow the company to manage between good times and bad. It is fair enough for a company to write off legitimate expenses but it is not fair enough to use a company structure to avoid paying personal income tax because in these tough times personal responsibility means that everybody pays their fair share—everybody pays their fair share. 
The last thing New Zealanders need to hear is that it is a priority for this Government—for the plutocracy—to ram through the House in a week when we face urgency a bill to allow them to gift to little Johnny at a lower tax rate. That is not a priority for the New Zealand Parliament. It is not a priority on the gates of Christmas. It is not a priority in a week when urgency is looming. It is not a priority for the Labour Party. Labour opposes this bill which in many ways is innocuous but the abolition of gift duty will go down as an emblem of a Government that has lost touch with ordinary New Zealanders with people who are doing it tough in a recession and with its own values of personal responsibility. It has lost touch with the electorate and is soon to lose touch with the Treasury benches. Opposition has been fun but we are over it; we are ready to govern. 
CRAIG FOSS (National—Tukituki) 
: 
 Obviously the previous speaker David Cunliffe has been very busy over the break practising his elocution speeches and presentation. I thought I was watching the United States House of Representatives for a while then. I would point that member towards the Supplementary Order Paper that will be put forward in the Committee stage of the other tax bill on I think Thursday. I also point him towards Budget 2010 which talked about loss attributing qualifying companies qualifying companies and the need to claim credits at the same rate that they were built up in the first place. That is what that Supplementary Order Paper will be all about. 
Hon David Cunliffe 
: Tinkering. 
CRAIG FOSS 
: Well it is quite major tinkering because the thrust of those arguments has already been debated in this House and voted for in Budget 2010. The member will see those amendments in the Supplementary Order Paper on Thursday and I am sure he will be voting for them given the speech he just made. 
The Taxation (Tax Administration and Remedial Matters) Bill is a continuation of a move towards a world-class tax system. It is a move to remove arbitrage to remove any problems or differentials between the various tax rates where possible and to try to align rules and regulations. 
The previous speaker talked about tax avoidance. If members look at the statistics from 2000 to 2002 they will see that as a consequence of moving the highest marginal tax rate from 33 percent to 38 percent versus the corporate tax rate and the trust tax rate there was an absolute explosion in the use of loss attributing qualifying companies in various structures and even more so when the portfolio investment entities came out. 
Only the Labour Party would want the community—middle New Zealand as the previous speaker said—to spend $70 million in order to retrieve $1.5 million of tax revenue. That is such backwards economics. Given the previous speech we see that essentially the Labour Party wants New Zealand to spend $70 million on accountants and lawyers to retrieve $1.5 million in tax revenue. That is total voodoo economics. There are less polite ways of describing it but maybe a bit of education is required over there. It is absolute nonsense. We now know that Labour members will be campaigning on a platform of introducing a capital gains tax and hiking the top tax rate. They will be bringing back gift duty by the sounds of things. Given the speeches the other day from Mr Goff and Mr Cunliffe or “Mr Caygill” I think they are all over the show. At the end of the day Labour can promise all it likes but we inherited an economy that had tax problems with declining revenue and an increase in expenditure and we are just hearing a continuation of that from members opposite. Obviously that will be a debating point on this bill. 
The other point is about sharing information across agencies. Many electorate MPs have people coming through the door and often their problem is a communication issue between various Government departments. For example Work and Income New Zealand might not have spoken to the Inland Revenue Department or to the Accident Compensation Corporation and they all throw up their hands. In fact often it is not actually legal for them to share information. But for the benefit of that person and for the benefit of the taxpayer and the taxpayer’s balance sheet a more lateral sharing of information is required within the tight parameters that the Minister outlined earlier. This change is a welcome move towards a world-class tax system. 
If this bill passes its first reading and I am sure that it will the Finance and Expenditure Committee will welcome it and will work hard on it. I look forward to seeing this bill at the select committee. Thank you. 
BRENDON BURNS (Labour—Christchurch Central) 
: 
 I have to question this Government’s priorities. We are a week away from the end of the parliamentary sitting year and here we are with the introduction of the Taxation (Tax Administration and Remedial Matters) Bill in which the priority is abolishing gift duty for the wealthy. Some members opposite may recall that 3 months ago my province of Canterbury was hit by a force 7.1 earthquake. It has faded from view for some people including some members opposite but not for many members of the Canterbury business community. Tonight they still face the impacts of that quake and those impacts extend to their businesses. They are not looking for a bill to abolish gift duty; they are looking for some assistance from the Government to help them through a period that has seen in many instances turnover reduce by 50 percent or more since the quake. 
A week ago last night I attended one of the many business group meetings that have been happening in my city of Christchurch. I was one of two MPs there; the other was the Hon Jim Anderton. It was a meeting called by concerned business owners who cannot sustain the jobs that they want to hold on to in the face of the impact of the quake on top of a recession that still very strongly lingers in Canterbury and across the country. At that meeting one of the speakers was a woman called Judy Tardi who for more than 20 years has run the Aspiring Language Institute. She is a Hungarian migrant who came to New Zealand for the opportunities that it presented. She has worked very very hard. She has paid her taxes. She is not looking for a cut in gift duty. She told the meeting she had survived the impacts business-wise of 9/11 and of the severe acute respiratory syndrome crisis. Indeed she had survived the recession. But on 4 September a 7.1 magnitude earthquake flattened not only many parts of Christchurch and Canterbury but also the prospects of many businesses including hers. 
Judy Tardi’s business turnover is down by 80 percent and she is not even sited within the central business district of Christchurch; she is based further out in my electorate of Christchurch Central in St Albans. But the images of the quake endure. The only images of Christchurch and Canterbury that people who in the past might have come and taken up courses at her language college have seen are of a city that is very badly damaged. Despite the fact that 90 percent of the city is perfectly fine the images on television do not convey that. Judy Tardi has now borrowed $85000 on her own mortgage to try to keep her business going and her staff employed. She asked why the Government is not providing some assistance to her. 
Judy Tardi is not alone in asking that. Another speaker at the meeting was Ange Leonard who runs the City Seafood Market retail outlet in Christchurch. It was a top shop finalist last year. Her turnover despite the business premises not being affected by the quake is down by 50 percent. She has had to let two staff go. Those businesses are only a fraction of the hundreds of businesses across Christchurch and Canterbury that have been knocked for six by the quake and its ramifications because people are not coming into the inner city in the same way as they used to. They are going to the malls; they are staying away from the central business district. Those businesses are not looking for a cut in gift duty. They are not looking for this bill; they are looking for something to assist them. They want a helping hand with their cash flow. 
The Canterbury Employers Chamber of Commerce put up a package to the Government—a very modest package—for $3.1 million to assist businesses like the two that I have detailed and many hundreds of others. Nothing was sought in that package in respect of the abolition of gift duty. It related to assisting businesses with such expenses as relocation costs when they have had to move. That package was turned down flat last Monday and instead a pathetic derisory package was announced by the so-called Minister for Canterbury Earthquake Recovery Gerry Brownlee. What Canterbury got after a 7.1 magnitude quake which was the biggest in this nation’s history and the biggest single natural disaster that we have ever seen in our nation was a package that provided two full-time business mentor advisers and a half-time person in Kaiapoi. It was two business advisers and $100000 to promote Canterbury business—$100000 to be shared with Kaiapoi to promote Christchurch and Canterbury business. That by my estimation would buy two television commercials on Australian television—and the people of Australia still have those enduring images of earthquake damage as do many other people around the world. 
Again I have to ask the question where on earth are this Government’s priorities? We have a city that is still feeling the ramifications of our worst natural disaster. Why are the Canterbury members of Parliament opposite not standing up for their constituents and for their businesses which have been knocked for six by this quake? Here we are debating the introduction of a bill that is simply a further tax cut for those at the top end of the income spectrum when we have very fine business people who want to continue employing people but who have been unable to hold on to staff in many instances because of the impact of the quake and all that it has brought upon our city and region. We are not seeing the advocacy that we expect from members opposite when it comes to saying this is a time when the Government needs to come to the help of Cantabrians. 
This is a time when we expect the Government to intervene. If one is a farmer affected by snowstorms then one looks to the Government. If we have a region affected by drought we look to the Government. If we have a region affected by floods we look to the Government. Well surely when we have a region like mine which has been affected by a 7.1 magnitude quake of the type size and scale that the  
Dominion Post  
suggested today could result in 1500 lives being lost in the city of Wellington and the response package from the Government is an absolutely pathetic derisory $100000 promotional package and a couple of business mentor advisers— 
John Hayes 
: Well you spent all the surpluses over 9 years. 
BRENDON BURNS 
: The member for Wairarapa is very welcome to stand up and defend that package. He can tell his constituents back in the Wairarapa that he thinks it is appropriate. He can tell them that if the Wairarapa is struck by a 7.1 magnitude quake they can expect to receive $100000 to promote their region because that is what has been given to Canterbury. 
The reason that was given for not providing more help and assistance to the Canterbury business community was the fear of creating a precedent. What on earth does that mean? I ask whether that means that if Wellington is struck by a 7.1 magnitude quake it will not receive any funding because this Government’s priorities are very firmly focused on such measures as introducing another tranche of tax cuts for those at the top end of the income spectrum and not on delivering assistance for people who are trying to keep businesses going in Canterbury. 
Amy Adams 
: This is pathetic—pathetic and not correct. 
BRENDON BURNS 
: The member for Selwyn is very welcome to take a call and defend that package. I would be delighted to have her solidarity because I tell members that I have been raising these issues and I have been asking these questions and I have not heard a peep from members like her who should be defending their constituents. She should be standing up taking a call and saying: “Give us a go Minister. We are in need in Canterbury.” It is about time that the member did that. Instead of giving eloquent speeches about the impact of the earthquake on her personally she should take a call and say to the Minister and the Government that this package is not good enough and that we should not be debating a week before Parliament adjourns a bill that simply gives more money to those who do not need assistance. 
When we have good employers in Canterbury bleeding jobs and an inner city devastated by an earthquake all that the Government can do is to come up with a package of $100000 to promote our city. It is pathetic it is derisory and it gives the fingers to Canterbury. It is appalling treatment. It is appalling treatment by this Government and the Government members stand condemned for it. If they will not stand up take a call and criticise their Government then they should not hold their seats at the next election. The people of Canterbury will judge them on the basis of that package. People will judge those members on that basis because they have failed miserably to stand up for their constituents and give people what they are asking for. A very modest assessment was proposed by the Canterbury Employers Chamber of Commerce and $100000 was given instead of $3.1 million. It was a modest request from a responsible chamber which is well led and well organised. That is what Canterbury needed and instead we got this bill. 
Dr RUSSEL NORMAN (Co-Leader—Green) 
: 
 I rise to speak to the Taxation (Tax Administration and Remedial Matters) Bill. The Green Party will not be supporting this bill. The bill has a couple of elements that we do not particularly like and I will talk about those briefly. We will obviously be following the select committee process very closely because during that process our minds might be changed. But we will see. 
I will talk about two key elements. The first is information sharing and some of the privacy elements in this bill. The bill enables greater information-sharing and we have concerns about some of the bill’s privacy elements and about whether the privacy of individuals will be affected as a result of the bill. The second concern relates to the abolition of gift duty which has already been canvassed at some length tonight. 
I will talk briefly about the regulatory impact statement because obviously there will be a very lively debate about the extent to which this bill affects tax avoidance. But the officials are telling us in the regulatory impact statement that basically they do not know. Paragraph 64 of the regulatory impact statement states: “Concerns about the potential for income tax reduction as a direct result of gift duty repeal are not possible to quantify particularly because the extent of protection currently offered by gift duty is speculative.” So the officials are telling us in the regulatory impact statement that if this bill were to proceed into legislation and if gift duty were to be abolished it would be very hard for us to know to what extent income tax would be reduced. That is one of the unknowns around the action of gift duty. We know that gift duty acts to some degree to stop various tax avoidance practices. It certainly has done so in the past and thereby one would think the abolition of gift duty would open the spigot to some degree of tax avoidance. To what degree is actually unknown according to the officials. 
We know however that tremendous activity is currently undertaken to avoid gift duty and the way that that is done according to the regulatory impact statement is through the use of gifting programmes. I quote from paragraph 25 of the regulatory impact statement: “Gift duty is easy to avoid through the use of gifting programmes. Under a gifting programme an asset is sold at market-value in exchange for an interest-free on-demand loan for the value of the asset. Legal title to the asset instantly transfers but no payment is made. The interest-free on demand debt that the recipient of the asset owes to the donor is then progressively forgiven by the donor at a rate of $27000 every twelve months.”—which of course is the level currently at which gift duty kicks in—“The forgiveness of the debt constitutes annual gifts; however they are within the acceptable levels so as not to attract gift duty. Until it is completely forgiven the debt owed is legally an asset of the donor and the donor can demand that it be repaid.” Paragraph 26 states: “These gifting programmes are widely used to transfer large assets without attracting gift duty. The fact that just 0.4% of gift statements received by Inland Revenue result in liability for payment of gift duty is clear evidence of the widespread use of these programmes.” and finally: “They are most often used by individuals to transfer ownership of their assets to a family trust.” 
We are seeing at the moment that gift duty is having a very significant impact. The impact of gift duty is that individuals are structuring their financial affairs to transfer assets into family trusts but they are doing it in a way that means they do not have to pay gift duty. This is strongly suggestive of a tremendous thirst out there to transfer assets into family trusts. The fact that 99.6 percent of all gift statements do not result in liability for the payment of gift duty shows that in the vast majority of cases according to the officials individuals are transferring ownership of their assets to a family trust. If we remove the gift duty then we will open the spigot on that process. 
We could argue that gift duty is not currently working and I think that would be a fair argument. But there are two responses to a tax that is currently being avoided: the first response is to change the tax so that it cannot be avoided; the second response is to give up put our hands in the air and simply say: “Oh well the Inland Revenue Department gives in because we aren’t going to tighten this rule.” With this bill the Government has basically adopted the surrender approach. The Government has acknowledged that gift duty has the purpose of trying to find a way to tax the movement of assets into family trusts but that that tax is basically being avoided so the Government will therefore abolish gift duty. There is another response which is to ask how we can close the loophole and try to reduce the level of tax avoidance. 
The second issue that has come up means that since changes in the tax rates were made there has been an alignment between the trust rate and income tax rates. Arguably there is lower incentive for individuals to use these mechanisms to try to avoid paying tax because previously a differential between the highest tax rate and the trust rate meant there was an incentive for people to slowly move their assets into those trusts to try to avoid paying the full rate of tax. One argument would be that with the alignment of these tax rates there is no longer that incentive. 
The problem is that there is a whole problem in tax avoidance that operates in relation to trusts which will continue to operate even with the alignment of the tax rates. We have a problem with the trust law essentially because it is very very difficult for the Inland Revenue Department—or for anyone else for that matter—to get a very clear perspective about what is happening inside family trusts. They can operate and it is very difficult to see through them so they are a classic way that has been used a lot in New Zealand to minimise tax payments or to run tax avoidance schemes. 
Currently even in the worse case scenario gift duty provides the Inland Revenue Department with a paper trail of what is going into those family trusts so that the Inland Revenue Department has some record of the money pouring into the trusts. If we were to abolish gift duty—so we would not have any incentive any more for people to arrange their affairs in such a way that over 99 percent of them would not pay gift duty—but at least alert the Inland Revenue Department to that money flow we would reduce the level of intelligence that the Inland Revenue Department has operating in respect of family trusts. That is we would make it easier for people who know how to operate these systems to avoid paying their tax. For that reason the Greens have a concern about this legislation. 
This legislation should be put in the context of course that a series of tax changes we have had have benefited those at the upper end. It is a matter of public record that of the tax cuts that were introduced 40 percent went to the top 10 percent of income earners. So we are operating in a context in which we have already made very significant changes to our tax system which have overwhelmingly benefited people on incomes like those of the people in this room. We are the major beneficiaries in fact of the tax changes. Of course the chief executive of Westpac New Zealand is an extremely major beneficiary of these changes as are high-wealth individuals. In that context I ask whether we want to change gift duty and get rid of this attempt to control this flow of money rather than try to actually tighten it up. That is the challenge before us. I ask whether we should try to close the loophole or just give up and surrender. This bill says that we should give up and surrender. 
The Green Party does not think that that is the way we should be amending our tax system. We do not think that the broader context in which we are operating—which is to make the tax system more hostile to low-income individuals—is really the way that we should be changing the tax system. The Green Party would support for example a capital gains tax that excluded the family home. We think that that is an important missing part of the New Zealand tax system and earlier on Mr Cunliffe talked at some length about the need to ring-fence losses coming out of loss attributing qualifying companies. So there are a number of ways that we could improve the tax system to make it fairer; getting rid of gift duty is not one of them. Although we will be listening closely to submissions at the select committee we will not be supporting this bill at the first reading. Thank you. 
RAHUI KATENE (Maori Party—Te Tai Tonga) 
: 
 I am pleased to stand to speak on the Taxation (Tax Administration and Remedial Matters) Bill which amends the Tax Administration Act 1994 to improve the ability of the Commissioner of Inland Revenue to disclose information in the course of furthering good tax administration practice. We support this global goal. We support any intervention by the Government to increase transparency and promote the effective use of Government resources and taxpayer funds. So we actually welcome the move to abolish gift duty because it no longer raises any significant revenue and it imposes a high level of compliance costs on the private sector. One of the goals that we the Maori Party campaigned on was to review compliance requirements so that there was no increase in compliance costs. So much in the same way we welcome the changes to the procedural rules around the tax disputes process which together with some administration changes to the process would make for a much more streamlined process. 
The Maori Party supports the general premise of privacy law which is the promotion and protection of individual privacy and it has commented previously on its concerns regarding the protection of privacy and flows of personal data. We have raised concerns about information held by agencies and how it is used. The bill makes it easier for tax information to be shared with other Government agencies in certain circumstances. These circumstances appear to be ones that are justified because the asking agency already has the ability and authority to collect the information in its own right. The ability for this information to be shared with credit rating agencies no longer applies. The legislation confirms plans to widen the scope for the Inland Revenue Department to share individual taxpayer information but only with Government agencies that would have the power to collect the information anyway. So we are very pleased with that. I am really pleased that this legislation does not go as far as it first threatened to when there was the idea that individual files would be given to credit rating agencies. We are definitely pleased that that idea was abandoned. 
Perhaps the only point that we have a question on is the decision that donee status will be granted to some overseas charities. The bill proposes that charities that apply some or all of their funds outside New Zealand must be approved for charitable donee status. Donations to recognised organisations entitle individual taxpayers to a credit of 33.3 percent of the amount donated up to level of their taxable income. We have had a look at the seven charities and we are really pleased with the work that they are doing. We have no question at all about the immense value of social entrepreneurship demonstrated in those seven organisations. Our only question relates to why those seven were chosen and what was the rationale for including those seven—[ 
Interruption 
] thank you for that—as opposed to any number of other organisations that may fall into this category. Hopefully there might be others—that are already doing that work and are not new—that can be added in. But we are very pleased with the way this bill is going and we will support it at its first reading. 
AMY ADAMS (National—Selwyn) 
: 
 I am pleased to stand up tonight to take a call on the Taxation (Tax Administration and Remedial Matters) Bill. We have already heard in the House tonight discussion on some of the key things this bill does. I commend Rahui Katene from the Maori Party who addressed the full ambit of what this bill does rather than focusing on just a single aspect the removal of gift duty. 
I have to start there though. Frankly having listened to some of the contributions tonight I am appalled at the level of absolute claptrap being spoken about the system. I would be very surprised if any of the members who have contributed in the last half an hour that I have been sitting here with the possible exception of Rahui Katene have ever been through the process of managing a gift duty application applying transactions or setting up these very structures and dealing with them. Listening to some of the speakers it became very clear to me that they had no concept in fact of how gift duty works what it does and how simple a matter it is to structure one’s affairs so that it is of no relevance. 
We heard from Mr Burns that he will not support the removal of gift duty because it does not do anything to assist recovery from the Canterbury earthquake. Well I say good on him but this is tax legislation. The Canterbury earthquake is of course a very serious matter but life does go on. This is a tax bill that addresses issues with the tax system and for the member to say that he will not support it because it does not do anything for the Canterbury earthquake recovery efforts is inane. 
Then Mr Caygill—sorry Cunliffe—said that he does not support it because guess what it is a tax cut for the wealthy. Talk about a one-trick pony! That man cannot give a speech in this House without claiming that the Government is giving tax cuts to the wealthy. But let us look at this. Gift duty is not a tax cut. It creates almost no revenue for the country. Do members know what this bill is doing? It is removing a nice little earner for lawyers and accountants up and down the country. If Mr Cunliffe is concerned because we are removing this nice little revenue stream from lawyers and accountants up and down Herne Bay then he should say so and not pretend that it is some sort of tax cut package for the wealthy. Either the man is disingenuous in the extreme or he has no clue and I suspect that it is possibly both. He is probably a little out of sorts because his leader does not know who he is. 
But let us be really clear. Gift duty does not stop assets from being transferred. Gift duty has never stopped assets from being transferred and as anyone who is familiar with the sector knows its removal will not suddenly open up the way for assets to be transferred into family trusts. Gift duty has been the simplest thing to structure one’s affairs around for years and years and years. In fact its abolition recognises that it is a nonsense. Rather than create an industry of fee charging for the professional sector let us be up front and say it is not achieving anything of note for the public purse it is not stopping assets from being moved into other structures and it simply creates a compliance cost burden that is far from justified. I think the arguments referred to in the House in respect of this measure have been pretty poor and I hope we will have a better discussion at the Finance and Expenditure Committee. 
I end my contribution tonight by picking up the other two key elements of the bill which are quite important. They are the changes to the secrecy and information-sharing rules which are critical to making our tax system work well and frankly deserve a lot more debate on them than we have heard tonight and the changes to the tax dispute system. That is where the real meat of the bill is and I hope we have a better discussion on them at the select committee than we have heard this evening. Thank you. 
Hon SHANE JONES (Labour) 
: 
 I too look forward to hearing what the submitters actually say when the Taxation (Tax Administration and Remedial Matters) Bill wends it way to the Finance and Expenditure Committee. I will not say a great deal about the gift duty portion as my colleagues have traversed that field but there will inevitably be a debate as to whether the removal of the gift duty obligation improves or worsens the situation in terms of people’s entitlement to various social benefits. 
Today a report was put forward by Diana Crossan in which essentially she warned parliamentarians about the burden of our ageing population and the welfare cost associated with the changing nature of our population. 
I acknowledge part of the contribution that came from Minister Dunne. Without doubt there are very large challenges before us as a country and as an assembly as to what the balance is how we raise our revenue how we dedicate revenue to those who need it and at what point their need should be assessed. In one small respect he says he is raising a remedy to that but that is an innovation we will not be agreeing with. 
I want to talk about something that did concern a number of us at the select committee when we received an earlier briefing about some of the changes the Inland Revenue Department officials were looking at. I found very helpful the Inland Revenue Department officials’ outlining some of their thinking and the responses that came to us from the public. One of the concerns—and I am glad that the Minister of Revenue is in the House—is whether the State agency the Inland Revenue Department ought to be simplifying the transfer of information to private credit agencies. I understand and fully support the opportunity for the public to come and tell us what it thinks in relation to the sharing of data and information between State agencies. Given that we are in the business of improving efficiency and trying to lessen the administrative burden I can get my head around that. But the next step relates to whether people who either owe debt or are endeavouring to pay back debt and who are negotiating the final quantum etc. with other State agencies ought to have that information disclosed if it involves child support and student debt to private credit agencies. I digress slightly but it is an issue that impacts on the administration efficiency and integrity of the information that the Inland Revenue Department keeps about us as citizens. This bill does not include those provisions but I have no doubt—through you Mr Deputy Speaker to the Minister—that this will remain a live issue. It is as much a privacy issue and a justice issue as it is a tax administration issue but it is something that bothers me considerably. 
The new framework for sharing Inland Revenue Department information provides that the manner in which that information is exchanged or provided is at the same time shared with the citizen it pertains to. There may be some circumstances where investigations are under way and privacy is required in terms of what information can be revealed to the person who is suffering the not inconsiderable powers of the State to investigate his or her affairs but I think that the best way if this is ever to work—and I look forward to hearing what the submitters have to say—is to ensure that the citizen concerned is not overwhelmed or feels that he or she is in some sort of Orwellian experience. 
In relation to the deeper question of whether other changes could have been made members on our side of the House have recited some might say ad nauseam the reasons we did not agree with the distribution of winners and losers in the recent tax changes. We are told that $250 million a week is being borrowed by the State. I think that once we shrink the Crown’s revenue we can get revenue from only one of two other sources: by raising it through debt or by shrinking—and I would say savaging—our cost structure so that rather than put our revenue up which would be to restore some of the taxes that have been lessened we are left with the problem that the Government currently has. So we did not agree and we will be not agreeing that the recent tax changes have enriched the country. That key ideological point defines the different approaches between the two parties. 
We heard from the co-leader of the Green Party about his enthusiasm for a capital gains tax. Earlier this year the Tax Working Group out of Victoria University did not embrace a capital gains tax model. It is certainly not something that we have been trumpeting loudly on this side of the House or racing forward as a key feature to the tax change. This bill shows us that if we continue to treat the tax system so that it rewards only a narrow category of people and worsens the burden of the majority we should not for a moment think that that narrow category of taxpayer as a consequence of having more dough at their disposal will somehow act as a new agent of dynamism to unleash economic growth and represent a new threshold for investment new firms new jobs etc. That is something that probably lies behind as my colleagues were saying why we will not be agreeing with the changes to gift duty. 
The member from the South Island Amy Adams told us I presume as a consequence of her unsurpassed knowledge of being an accountant about how easy it is to circumvent the current rules etc.— 
Hon Christopher Finlayson 
: She’s a lawyer. 
Hon SHANE JONES 
: Oh sorry a lawyer. I feel that she needs to change the tune in terms of how she addresses the select committee because she has left us with the impression of being not only a highly qualified legal beagle but also a very skilled accountant. That may be the case but that does not necessarily lead her colleagues to conclude that she is a fine parliamentarian. In fact I think Hekia Parata is a fine parliamentarian. I have yet to enjoy the opportunity to acknowledge that she has ascended the ranks. She now occupies a position that is possibly the most junior position but one that is quite a lofty spot to occupy. I too was once there. So along with my colleague Parekura Horomia I want to congratulate— 
Hon Member 
: In what? 
Hon SHANE JONES 
: I have had slightly different positions this year and I have heard enough from “Ngati Wahine” at the back. I might have to call on the Deputy Speaker’s support. I acknowledge the contribution that Hekia Parata has made. I look forward to hearing more of her in the House. 
We will not be supporting this bill. However we do look forward to hearing the submissions. It lays out some important challenges. Mr Dunne and I will never agree on everything but I would like to say one thing: he is clearly outlining the fact that revenue is brittle. When we have brittle revenue we have to find innovative ways to justify not only the cost but the purpose of running ongoing programmes. No doubt part of that will come from the submissions and it may only be as a segue because part of the debate about the gift duty was always a concern as to whether clever people with access to Amy Adam’s unsurpassed knowledge would be enjoying an entitlement to certain services of the State that we may not feel they deserve by dint of wealth that they putatively own but technically have handed on to another. So we do look forward to the submissions. Thank you very much. 
DAVID BENNETT (National—Hamilton East) 
: 
 That was a very interesting speech from the previous Labour speaker Shane Jones. Following a little bit of a different format from other Labour members he actually talked about the capital gains tax and in his words he “circumvented it”. He went around the issue. He did not say that Labour would not have a capital gains tax. He tried to distance himself from it. But at the same time he left open the option for having a capital gains tax. I think that is what Labour is thinking. If Labour wants to use the change in respect of gift duty to enable it to advocate for a capital gains tax I recommend that Mr Jones have a look at the numbers in this regard. He will realise that it is only lawyers and accountants who will gain from it. For Government revenue of about $1.5 million we spend over $400000 in costs in getting that revenue. Businesses communities individuals trusts and the like pay about $70 million in tax advice in making that happen. There is a huge compliance cost which is not matched by revenue for the Government. 
In the end this is a very practical measure. It is not a measure that Labour is saying is for the rich. This is a practical measure to make sure that we take out some of the costs that are associated with doing business and that do not deliver benefits to either a business or the Government. There is no benefit to the Government that is of any consequence here and there is no benefit for the business community or the individuals involved. All it does is help lawyers and accountants make more money by charging more fees. We are making business and individuals able to perform their duties in a much more constructive and economically friendly way. It cannot be used as a reason for having a capital gains tax as the previous speaker intended. Thank you. 
H V ROSS ROBERTSON (Labour—Manukau East) 
: 
 Tena koe Mr Speaker. Kia ora tatou no reira e te Whare e nga iwi e nga reo e nga hau e wha. Tena koutou tena koutou tena koutou katoa. This bill the Taxation (Tax Administration and Remedial Matters) Bill will be referred to a select committee as the Government has the numbers to do so. There will be a debate on whether the removal of gift duty will assist or hinder social interaction but that is only one part of this legislation. It is wide-ranging legislation. It is taxation. I know that the Minister of Revenue has spent a number of years in this field and one would expect him to be well versed in how the system works. 
The explanatory note outlines that the bill amends the Tax Administration Act 1994. The reasons are: “to improve the ability of the Commissioner in defined circumstances to disclose information in the course or furtherance of good tax administration practice.” The explanatory note goes on to state: “Some information may be disclosed in circumscribed cases if it is in the interests of government efficiency. The bill also provides for other matters including the abolition of gift duty improvements to the tax disputes process and improvements to tax pooling legislation. A number of minor issues are also remedied as well.” 
It is the job of the Opposition to hold the Government to account. As a result the Opposition will oppose the bill. The reason is that the bill is seen as a tax break for the top 10 percent of wage earners and salary earners who have already benefited substantially from the two previous tax cuts. We are told by the Government that the bill abolishes gift duty. We are also told that gift duty no longer raises any significant revenue and that it imposes a high level of compliance costs on the private sector. 
I am all for the cutting out of waste and the reduction of compliance costs because this is an issue that has always concerned small business. I well remember campaigning throughout New Zealand as the small-business spokesperson some years ago when I was last in Opposition. I remember walking into a small business in Winton. It was a grocery store. As I walked in I saw the owner of the business sitting at a desk behind a mountain of paper. That has not changed; we still have compliance issues. When I told him that we were looking at the whole issue of compliance he said “Hallelujah!” and he threw all his papers into the air. 
Although I can understand from the Government’s point of view the need to cut compliance costs the question has to be asked of the Minister—and this is of interest to me—whether this bill might lead to additional compliance costs. The Minister shakes his head but I do not know. When we are talking about trusts all sorts of things can happen. 
Peseta Sam Lotu-Iiga 
: You don’t know. 
H V ROSS ROBERTSON 
: There is Sam Lotu-Iiga. I tell him to get up on his hind legs and take a call. But he has not yet because he has no answer to this. He has no answer and he does not know. 
The Minister said today in answer to a question in question time that people were using trusts to avoid taxation. Yet this evening we see that people who have trusts will no longer have to pay gift duty which in itself is a tax. This afternoon we have had it laid out to us in the House that there are those who use family trusts to avoid taxation in order to access family support so the indication was that those tax loopholes had to be closed—and rightly so; they will be. But tonight what we have here is robbing Peter to pay Paul—robbing Peter to pay Paul. What happens now is that those who have trusts will no longer have to pay gift duty. 
The member over there Sam Lotu-Iiga will take the next call. I challenge him to get up and answer those questions because that is what the member should do. The member should be answering those questions and I expect him to. Here are the questions that I will put to the honourable member and here are the reasons why Labour will oppose the bill. We want to hold this Government to account for anything that it does and it needs also to justify what it does. We look forward to the select committee process. Obviously— 
John Hayes 
: Being in Opposition is what you look forward to. 
H V ROSS ROBERTSON 
: No I tell the member that we will be swapping sides in 1 year’s time. It will not be too long now. Labour members will not support this bill but we look forward to the submissions to the select committee so that Labour members will have the chance to challenge the Government. Here are a few reasons why Labour opposes this bill. 
John Hayes 
: That is why you are still in Opposition. 
H V ROSS ROBERTSON 
: No. Scrapping gift duty represents a tax cut for the wealthiest New Zealanders. Labour is about fairness in taxation and that was one of the problems with the recent increase in GST. We know that the top 10 percent of those who received the benefits of the GST increase received 42 percent of the tax reduction. That is not fair. We also oppose the bill because scrapping gift duty is yet another tax break for some of the 10 percent of people who have already received a significant increase in their income as a result of the tax cuts. 
Hon Peter Dunne 
: Could the member explain how that is the case? 
H V ROSS ROBERTSON 
: We have just had the GST issue and we saw the top 10 percent of salary earners and wage earners receive more than 40 percent of the tax reductions. The bottom percentage of people saw very very little. That is the problem we have. 
Politics is all about priorities but scrapping gift duty underlines the fact that this Government is focused on delivering tax cuts for the wealthy. The Government has again justified its decision by saying that gift duty raises only $1.5 million a year and it costs half that amount to administer. I challenge the Minister to table the information that indicates that although the Government receives only $1.5 million a year half of the cost goes on administering the scheme. That is a considerable amount so I ask the Minister to front up to the select committee and justify that figure. 
The abolition of gift duty allows the wealthiest New Zealanders to structure their affairs by transferring income and assets into trusts and to their children to reduce their tax liability. That is not good enough. Labour is concerned that there be fairness in the tax system. We say there should be equity for all not just for the wealthy. The fact that people currently spend $70 million on gift duty compliance in order to avoid paying their fair share of tax is no reason for removing it. It just shows potentially how valuable this free lunch is for wealthy New Zealanders. I ask Mr Sam Lotu-Iiga who will take the next call to get up on his hind legs and justify the abolition of gift duty. 
Peseta Sam Lotu-Iiga 
: Sit down then. 
H V ROSS ROBERTSON 
: I have not finished. I challenge that member to get up and justify the Government’s stance because members on this side of the House will continue to hold this Government to account to justify everything that it has to say about this legislation. 
We welcome the bill going to a select committee because that is where the debate will take place. That is where we will find out whether the Government can justify what it wants to do. At present Labour members are not yet convinced of the arguments that have been put forward by the Government to justify its removal of gift duty. Although we accept there is a need to cut compliance costs and I am all for that there is a need for the next speaker to justify everything the Government is doing. 
PESETA SAM LOTU-IIGA (National—Maungakiekie) 
: 
 It is a privilege to speak on the Taxation (Tax Administration and Remedial Matters) Bill. I will answer a couple of the queries that were raised by the member for Manukau East. What shocked me about his speech was that although we were at the same small-business conference all of 3 months ago and he heard the concerns issues and problems that are faced by small-business owners in his speech he neglected the concerns that were expressed to us as a group of MPs that day. Those concerns were red tape bureaucracy and the compliance costs that constrict and restrict the ability of business people to get on with their business make money and employ people. 
It is incredible that he talked about a tax cut when we know the facts are on the table. We know that the gift duty scheme provides just $1.5 million a year in revenue but imposes $70 million a year in compliance costs—$70 million. For the benefit of the member the amount of compliance costs is approximately 47 times that of the revenue it generates for our Government. In anyone’s language that is a travesty and something we have to get rid of. 
I do not take the approach of some of my colleagues to lawyers and accountants having been a former lawyer and financier myself. Those people are merely doing the job they have been asked to do in terms of the regulations and the laws in place at the time. That is why we are in the House: we are here to reform the law in order to remove those compliance costs so that individuals their families and their communities can get on with making a living. In my own electorate of Maungakiekie business people and individuals tell me that those burdens really impact their on lives and their families’ lives. 
Last week the Prime Minister and I were at the opening of a furnace plant. I say that because it was the biggest investment this year by a corporate. Owens-Illinois poured $125 million into that business in Penrose in my electorate. Really it is about providing jobs and opportunities. When I asked the chairman of that global corporation why it was doing business in New Zealand he responded by saying that it was because the corporation saw New Zealand as an investment it saw the people involved in New Zealand and it saw New Zealand running well. It saw a business-friendly environment and a business-friendly Government. That is why it is in New Zealand. 
The bill is about continuing that vein of providing business opportunities and jobs and minimising red tape and bureaucracy. That is why I recommend the bill to the House. It is part of the overall package that this Government is implementing to provide jobs and opportunities for New Zealanders. I look forward to the select committee process where we will be better able to discuss the finer points of this bill. Thank you. 
A party vote  was called for on the question  
That the Taxation (Tax Administration and Remedial Matters) Bill be now read a first time. 
Ayes 68 
New Zealand National 58; ACT New Zealand 4; Maori Party 5; United Future 1. 
Noes 51 
New Zealand Labour 41; Green Party 9; Progressive 1. 
Bill read a first time. 
Bill referred to the Finance and Expenditure Committee. 
State Sector Management Bill 
Second Reading 
Hon TONY RYALL (Minister of State Services) 
: 
 I move  
That the State Sector Management Bill be now read a second time 
. This is the second reading and report back of the State Sector Management Bill which has come back from the Education and Science Committee and I would like to acknowledge the contribution of all members on the bill. 
The State Sector Management Bill is an omnibus bill and the intention is that during the Committee of the whole House it be divided into three separate bills: a research science and technology bill a National Library of New Zealand (Te Puna Matauranga o Aotearoa) amendment bill and a public records amendment bill. 
I recap the bill and the machinery of government objectives. The bill provides for machinery of government changes in two important sectors. Two existing agencies—that is the Ministry of Research Science and Technology and the Foundation for Research Science and Technology—will merge into a new Ministry of Science and Innovation and the National Library and Archives New Zealand will be brought together into the Department of Internal Affairs. These changes are part of the Government’s drive to ensure that State services are organised to deliver improved front-line services within existing baselines to reduce costs once the transitions are embedded and to future-proof the long-term delivery of services by Government agencies. The changes along with other well-publicised structural reforms in the State services such as those in the New Zealand public health service add up to a commitment by the Government to put in place the administrative arrangements that are best suited for each sector. 
Part 1 addresses the research science and technology sector. The amalgamation of the existing Ministry of Research Science and Technology and the Foundation for Research Science and Technology—a Crown entity—will see the new Ministry of Science and Innovation clearly leading the sector as a single agency combining the operational and policy skills of the two current agencies and simplifying and streamlining the accountability arrangements both for the new ministry and for the recipients of research science and technology funding. The changes will also reduce complexity and transaction costs across research science and technology and will enable gains in efficiency. The changes will future-proof the delivery of services by combining the expertise of what are now two small agencies which will put them on a more viable corporate platform with increased critical mass and capability. 
Part 1 does much more than repeal the foundation’s current Act disband the foundation and transfer its employees to the new ministry. Its main provisions are to set out the purposes for which specified research science and technology funding may be allocated; to require the Minister to establish one or more boards to make independent decisions on the proposals for specified research science and technology funding; to require the Minister to set and publish in the  
Gazette 
 the criteria that the boards will use to make their allocation decisions; and finally to require the chief executive of the new ministry to refer the funding proposals to the boards and to supply all secretarial and administrative services to enable the boards to carry out their functions. 
Parts 2 and 3 bring together the Government departments that gather protect and develop the current and future use of some of New Zealand’s main records knowledge and information resources. The amalgamation of Archives New Zealand and the National Library with the Department of Internal Affairs will bring together knowledge leaders in fields of mutual interest. The amalgamation will build on their common capability and their overlapping strengths in information management and information technology. That will put them on a par with a number of other agencies around the world. 
The bill by amalgamating the three departments will set up the core infrastructure that will enable better-integrated decision-making in the future be the decisions about future spending technological systems development or other aspects of their operations. For these amalgamations we can expect systems improvements lower corporate overheads and reduced costs within the public management system. 
A key feature of Parts 2 and 3 is how much of the existing legislation remains intact for Archives New Zealand and the National Library whereas Part 1 repeals the Foundation of Research Science and Technology Act. Parts 2 and 3 deliberately leave untouched much of the National Library of New Zealand (Te Puna Matauranga o Aotearoa) Act and the Public Records Act. The objective of the bill is to make only the necessary minor changes to the existing Acts in order to bring about the machinery of government changes. These are largely technical matters about departmental administration. I expect that the Hon Nathan Guy as the Minister responsible for the National Library and the Minister responsible for Archives New Zealand will take the opportunity to outline these provisions in more detail. 
The State Sector Management Bill was introduced towards the end of August and to have it reported back to the House so early in December is a really significant achievement. I thank the Education and Science Committee and I commend it for its hard work and its valuable recommendations. Thirty-one individuals and organisations also made submissions. The committee recommended a number of amendments which I will go through. 
In relation to clause 7 “Purposes for which specified RS&T funding may be allocated” the select committee recommends and the Government agrees that “RS&T” should be spelt out in full to “research science or technology or related activities;”. [ 
Interruption 
] It is just great that the Labour Opposition turned up and achieved something. It is intended that these terms have their ordinary and natural meanings and there should be no confusion about the references to “RS&T”. 
Secondly it is important that the boards that are set up are making independent funding decisions. In respect of clause 9 “Decision making on specified RS&T funding” the select committee recommends and the Government accepts the addition of subclauses to enable the board to require the ministry to provide all the information it holds in respect of the decisions before it. 
The committee has also recommended that clause 11 be deleted. The clause provided for the boards to reconsider their decisions on referral by a Minister or chief executive. The clause was not intended to fetter the independence of the boards. The clause was discretionary and merely permitted the board to reconsider a decision. The committee made a recommendation which the Government is agreeing to that that clause be removed from the bill. Clause 15 was also unnecessary and the committee has recommended that it be deleted. The clause dealt with the transfer of functions from the Ministry of Research Science and Technology and the Foundation for Research Science and Technology to the new ministry. That transfer of functions is not usually conferred by way of statute; it is dealt with through Cabinet process and that will continue. 
With regard to the amalgamation of the National Library and the Department of Internal Affairs the select committee recommended one important change in the bill which the Government supports and that is deletion of clause 27(2) so that the legislation clearly retains reference to the collections of the Alexander Turnbull Library remaining in the custody of the National Library rather than in the custody of the department. Though the National Library will be part of the department it was never intended to cause doubt or confusion on this important point. 
In regard to Part 3 which deals with the amalgamation of Archives New Zealand and the Department of Internal Affairs the committee recommended amendments on an important point. It commented on the importance of retaining the identity of Archives New Zealand. Although the bill continues to define Archives New Zealand as the repository referred to in section 9 of the Public Records Act the Government agrees that references to the department should be removed where it is appropriate to maintain explicit references to Archives New Zealand. This applies to eight clauses where the specific functions in question will continue to be the functions of the repository—for example receiving transfers of public archives. 
The Hon Nathan Guy will no doubt have the opportunity to speak in more detail about the submissions received in respect of Parts 2 and 3 and about the Crown Law advice that the Government has received confirming the ongoing independence of the statutory offices within Archives New Zealand and the National Library. 
Despite a rather pathetic scare campaign by the parties opposite New Zealanders are not in the least bit worried about these changes. I again thank the Education and Science Committee for its judicious recommendations and the very speedy and prompt way that it reported this bill back to the House. The Government certainly supports progress on this bill. 
GRANT ROBERTSON (Labour—Wellington Central) 
: 
 That was Tony Ryall the Minister of State Services whose life’s passion is State services—that is his passion. Imagine if we heard about something he did not care about—imagine that! That speaking slot should have been given to Chris Finlayson because he knows as the Minister for Arts Culture and Heritage how important the National Library and Archives New Zealand are. In fact people around Wellington are saying that Chris Finlayson dropped the ball on this bill because he did not pick up the damage that was being done to Archives New Zealand and the National Library by this merger. 
Hon Christopher Finlayson 
: The luvvies know I’m a better Minister than Helen. 
GRANT ROBERTSON 
: I say to Mr Finlayson that the kumara does not speak of how sweet it is. This bill from Labour’s point of view is very much a bill of two halves. One half of the bill is about the merging of the Foundation for Research Science and Technology and the Ministry of Research Science and Technology. My colleague David Shearer will speak in detail on that. There is not a particular issue we oppose. There are some issues Mr Shearer wants to raise but that part of the bill from our point of view is not something we have a great deal of trouble with. However Parts 2 and 3 of the bill dealing with the merger of Archives New Zealand and the National Library of New Zealand into the Department of Internal Affairs we strongly oppose. We oppose the merger because those two institutions are vital to our constitutional and democratic infrastructure. This bill will reduce their independence and it will reduce their influence. But it struck me in the select committee process that we were offered no reason by the Government for why this merger should take place. 
Hon Darren Hughes 
: Step change? 
GRANT ROBERTSON 
: Step change! This was it; this was the answer to the economy; this was how we were going to do it. But no Mr Hughes that is not what it was because Archives New Zealand and the National Library of New Zealand are not failing. If these were failing Government departments or institutions that were struggling to meet their mandate perhaps that could be a justification for doing this merger. But actually in the Government’s own papers it said Archives New Zealand and the National Library of New Zealand are well regarded and successful institutions. If it ain’t broke why fix it? But the Government has pushed ahead. Perhaps it is about savings—perhaps it is about saving a huge amount of money for the country. Well no that is not true. It was very difficult to find out in the select committee actually how much money was intended to be saved by this merger but it could be as little as $166000 a year and there are 15 jobs going—$160000 a year for 15 jobs! So it cannot be about savings. 
We also heard raised the prospect that the legislation was about bringing together the technological parts of government—because the Department of Internal Affairs has taken on some of that work from the State Services Commission—and that there was a great deal of digitalisation work— 
David Shearer 
: They’ve got a bigger server. 
GRANT ROBERTSON 
: That is right. They have a big computer; that is right. There was a great deal of digitalisation work going on in Archives New Zealand and the National Library of New Zealand. The problem is that the medium and the message are being confused here. The fact is that the National Library of New Zealand and Archives New Zealand do a great deal more than just the process of digitalisation so that is not enough to justify the merger. In fact the officials themselves said that it is not enough to justify the merger. We were quite unable in the select committee process to actually discover what the rationale was for the Government. It seems that it is simply an ideological rationale about reducing the number of agencies no matter that those two agencies Archives New Zealand and the National Library of New Zealand are operating better than they ever have before. Yet they are now being merged into a department the Department of Internal Affairs that the chief executive himself and the review of the department have acknowledged is struggling to deal with the many different tasks and areas it has to cover. Now two more are being added in which are critically important institutions to our constitutional infrastructure. 
But why does this matter? It matters because Archives New Zealand provides the ultimate accountability of Government. It means that departments have to maintain records; it means that departments have to deposit records. At the moment Archives New Zealand’s role is critical in ensuring those records are there but this bill will reduce Archives New Zealand’s influence and it will reduce Archives New Zealand’s independence. That is bad for all of us in the long run because although it might not make the headlines this is the material that means that Governments are held to account. This Government on the opposite side of the House does not seem to care about ensuring that that occurs. 
In terms of the National Library of New Zealand it is similar: a reduction in influence a reduction in independence and a reduction in status and mana particularly for the Alexander Turnbull Library. We had submitters coming to the committee who said they would think again about depositing their families’ records in the Alexander Turnbull Library because it would be downgraded. 
During this process we became aware of the structure the Department of Internal Affairs is putting in place for this merger. That structure will mean that the Chief Archivist and the National Librarian will be third-tier managers within the Department of Internal Affairs. They will not even be part of the executive leadership team. They will not be part of setting the strategy for the Department of Internal Affairs. They will have no guaranteed access to the Minister. They will not be reporting directly to Parliament. This is a reduction in independence and a reduction in influence of key democratic historical constitutional and cultural institutions in this country. The Department of Internal Affairs already weighed down with other tasks will simply not be able to provide the kind of leadership needed and this is no great statement on the chief executive. 
I shall talk about the submissions we heard in the select committee. They were outstanding submissions and I think even the Government members of the Education and Science Committee who sat through the submissions would acknowledge that. They were some of the best that I have heard in my brief time here in Parliament. They came from people who knew their subject who had lived through this and this is not a theoretical exercise. In the 1990s Archives New Zealand went through the process of being part of the Department of Internal Affairs and it ended up in court. That was a failure in the 1990s and in the 10 years since Archives New Zealand was made a separate entity it has grown in leaps and bounds and now the Government is determined to drag it back to the time when it struggled. 
To quote one of the submitters a former Chief Archivist who said in terms of the Department of Internal Affairs’ control of Archives New Zealand: “The story of the care and control of New Zealand’s public records and archives … has been one of ignorance and neglect. Thousands of unique items that have relevance today have been lost by fire water vermin and indifference.” Vermin and indifference—that is what happened when Archives New Zealand was the—[ 
Interruption 
] That is right; there they are—vermin and indifference absolutely! 
That is the problem. That is what happened the last time the Department of Internal Affairs had control of these things. Another submitter said that the Department of Internal Affairs has an unfortunate history characterised by arrested development lack of resourcing poor understanding litigation rancour and distrust. That sounds like the National caucus as well. But that was also the Department of Internal Affairs when it had control of Archives New Zealand. It is simply not good enough for this Government to drag Archives New Zealand back to the 1990s when it was the subject of litigation rancour and distrust. We had two former chief archivists who lived through this and they know from their personal experience that they were not able to achieve their role fully. It was not always because of the Chief Executive of the Department of Internal Affairs—sometimes they were helpful. But when they were not that limited the role of those people performing those key historical constitutional and democratic roles. 
This bill is the wrong path to go down. We all want efficient and effective organisations in the State sector. We all want organisations that provide good services to New Zealand. Sometimes that will come from small independent agencies; sometimes it will come from larger bodies. Here we have a situation where Archives New Zealand and the National Library have been delivering good quality services to New Zealanders for the last 10 years. If we go back to the 1990s we simply go back to a period of time where New Zealanders did not know whether they could trust the archival records. They did not know whether the National Library would be able to provide the services that we all expect it to do for New Zealand. This part of the bill is wrong. Labour will continue to oppose it and in the Committee stage we will put forward Supplementary Order Papers to try to ensure that there is independence for the Chief Archivist that there is independence for the National Librarian and that that the status and mana of the National Library the Alexander Turnbull Library and Archives New Zealand are recognised. Those are important institutions. The National Government may not care about that but we on this side do and we will be opposing this bill. 
COLIN KING (National—Kaikoura) 
: 
 It is a pleasure to speak in the second reading of the State Sector Management Bill. In doing so I cannot help but pick up on the comment that the previous speaker from the Opposition made the part-time member of the Education and Science Committee Grant Robertson. In actual fact New Zealanders spent 9 years putting up with vermin and indifference in New Zealand. The Opposition would be mindful to realise that the Government is presently trying to construct a first-class world-class State sector and that this bill is part of that. Effectively from that point of view we are looking at the amalgamation of the libraries and the archives. 
Debate interrupted. 
The House adjourned at 10 p.m.