Volume 660 Week 35 - Tuesday 23 February 2010(continued on Thursday 25 February 2010) 
Volume 660 Week 35 - Tuesday 23 February 2010(continued on Thursday 25 February 2010) 
[Volume:660;Page:9341] 
Tuesday 23 February 2010 
( 
continued on Thursday 25 February 2010 
) 
Business of the House 
Hon DARREN HUGHES (Senior Whip—Labour) 
: 
 I seek leave for there to be a question time today at 2 p.m. with questions being lodged by parties at the Office of the Clerk by 10.30 a.m. this morning. 
Mr DEPUTY SPEAKER 
: Leave is sought for that purpose. Is there any objection? There is no objection. 
Children Young Persons and Their Families (Youth Courts Jurisdiction and Orders) Amendment Bill 
Third Reading 
Debate resumed. 
SUE MORONEY (Labour) 
: 
 I am disappointed to hear that the member for Hamilton West did not take his remaining 2 minutes to speak because I was waiting for an apology. I was waiting for him to say sorry to the people of Hamilton and in fact to the people of New Zealand for standing by while the very best facility that we have had to date to deal with high-risk offenders has been closed down by his Government in his back yard—in Hamilton. Yet during the member’s whole speech last evening not one mention was made of Te Hurihanga. Perhaps the member is embarrassed and rightly so. He should be embarrassed that his Government is flying in the face of the good people of Hamilton. It is flying in the face of two Hamilton bishops—the Anglican Archbishop David Moxon and the Catholic Bishop Denis Browne—who have both come out to criticise the Government about this very bad decision. 
If the Government was truly serious about dealing with youth crime and helping to turn angry young men’s lives around then it would continue to invest in the Te Hurihanga model. Te Hurihanga is now a proven model. It had been piloted for 3 years in Hamilton and the assessment was glowing about the results it had achieved with those very high-risk offenders. For people who are not aware of that model I say that it took in young men who had committed on average 23 offences before they had even stepped inside the facility. That was the high level of offending and we know from research and evidence—which the Government ignores at its peril—that it is the small number the minority of hardened offenders who cause the majority of grief in our community and our society. That is why Te Hurihanga is so important. It was dealing with the hardened high-risk youth offenders and it was achieving success. 
Yet this Government today in urgency is pushing through a bill to go back to a failed model. It is almost like having the McGillicuddy Serious Party as the Government. Talk about the great leap backwards! This is the great leap backwards: back to boot camps and back to a situation that we know does not work. We have research and evidence that proves that it does not work here in New Zealand; we have tried it. It does not work overseas; it has been tried overseas. This Government is going for the great leap backwards to something that does not work. 
I want to know from the Government—I still have not heard anything from the Government members and I will not as this is the last call on this bill; they have studiously avoided this question—what will replace the Te Hurihanga model in Hamilton. There we have a custom-built facility—an eight-bed facility— 
Tim Macindoe 
: The facility is remaining open. Child Youth and Family is taking it over. You know that—it’s all publicly available. The whole thing has been announced. 
SUE MORONEY 
: The member seems to know but he has not told the Hamilton community what will be replacing it. I ask Mr Macindoe whether it will be a 12-month programme. 
Hon Trevor Mallard 
: Not a word! 
SUE MORONEY 
: No he does not know. He does not know and neither does the Hamilton community. I ask Mr Macindoe whether it will be a 6-month programme. I ask the Minister for Social Development whether it will be a 6-month programme. They do not know. They have closed down this successful programme—an 18-month comprehensive wraparound programme—and they are trying to convince the country and Hamiltonians that they will do exactly that same programme but they will do it for about a third of the cost. 
Members of the Hamilton community are not dumb. They know that that programme cannot be delivered for $40000 per offender. They have been told it will cost only $40000 per offender. Currently the Ministry of Justice says that the programme the Government has cut was costing about $170000 per offender. That has been a very contentious issue. The Ministers have tried to inflate that figure and say that it cost $600000 per offender. The Government’s own ministry the Ministry of Justice says otherwise. So who is telling the truth? Well I would go to the Ministry of Justice website to see who is telling the truth. It is costing $170000 per offender and that is a fantastic investment in stopping crime in our country and in particular in my city of Hamilton. 
The Government—in its short-sighted uncaring way—has come to that community and completely disempowered it. I tell members that nothing is more disempowering for a community than to completely embrace a programme—even the people who opposed its being set up in the first place—and then have to fight the Government to keep it in place. Even though some people opposed the programme in the beginning they now know that it works. They have seen the results in their community and for those young men and they have turned their opinion around. But has the Government turned its opinion around? No way. That community has supported the programme—has put its heart and soul into it—and now an uncaring unthinking unfeeling Government has come along against all the research and evidence and said that it will not have that programme because we are going to have boot camps. 
Why are we going to have boot camps? It is because it made for a great bumper sticker slogan during the election campaign. That is the reason; there is no research or evidence for it. In fact the research and evidence shows otherwise. Once again I find myself in this House—as I have on many occasions and over many other pieces of legislation in respect of this Government—asking where the research is. Where is the evidence? What is the Government basing this decision on? The Government is not listening. Not only is it not listening to what I am trying to impress upon it but also it is not listening to the Hillcrest community in Hamilton. It is not just the Hillcrest community. If Tim Macindoe thinks that this will not be an issue in his area then he should talk to the Methodists he should talk to the Catholics and he should talk to the Anglicans and he should take heed of what they are saying. They are interested in social justice and they are interested in finding a true way forward. That member and his Government are more interested in bumper sticker slogans that will just turn into plasters over wounds. That is what will happen. 
This legislation is putting us in the predicament of having the Te Hurihanga programme close in June—mind you it will not if the Hamilton community has its way because it is in fight-back mode against this Government. It is in fight-back mode. 
Tim Macindoe 
: No evidence of that. 
SUE MORONEY 
: Tim Macindoe says he has not heard that Hamilton is in fight-back mode. Where has he been? 
I congratulate Karyn Knight a woman who lives in Fairfield who has started up a petition. When she came to see me for some advice and asked me to receive the petition and table it in the House for her I told her that I absolutely would because I firmly believe that the Government has made the wrong decision. I was interested in what her motivation might be so I asked her why she was doing this and whether she was a staff member at the facility and whether a family member had gone through it. When I asked her what her vested interest was she told me that she had no involvement with that facility but that she just thought people deserved a second chance. That is the type of sentiment that this Government should be listening to—not to bumper sticker slogans but to things that actually work. It should be listening to real people’s sentiments and programmes that the research and evidence—the Government’s own research and evidence and the assessment that it paid for—show work with our most hardened offenders. 
I think it is extremely shallow that all those members opposite have got up and said that they want to stop youth crime. If they really wanted to stop youth crime they would not be closing down Te Hurihanga and they would not be passing this bill. I am very proud to be part of a party in this Parliament that is opposing this shallow bill. 
TODD McCLAY (National—Rotorua) 
: 
 Good morning to my colleagues and to members opposite. As I was sitting having a good breakfast after a great night’s sleep I thought that all members might be in the same mood that I am in this morning but it is obvious from that last speech that some members in this House did not sleep as well as others. I would like to briefly thank a number of my colleagues and in particular the Minister for Social Development and Employment for bringing the Children Young Persons and Their Families (Youth Courts Jurisdiction and Orders) Amendment Bill to the House so quickly after the election for supporting the Social Services Committee in its work and for speaking so clearly about youth in New Zealand in all stages of this debate. Certainly yesterday the Minister spoke many times during the Committee stage and now during the third reading. 
I want to recognise other colleagues on my side of the House who worked on this policy when we were in Opposition. Anne Tolley certainly worked very hard on this as did Chester Borrows. Chester Borrows a member of Parliament whom I respect greatly has 20 years of experience as a policeman in our community working with the very young people whom members opposite were so quick to disregard during their term in office. Can I say—as I did during the second reading when Chester Borrows told the House that this bill will make a difference to young people—that I back what he said and I accept it fully. I would listen to Chester Borrows any day of the week before I would listen to a single member on the other side of the House as members opposite often have opinions but cannot back them up. I want also to recognise members of the select committee and the officials who worked very diligently for us over the last year. I thank submitters also. We heard from a wide range of submitters who had an opportunity to put their views— 
Hon Member 
: And they weren’t listened to. 
TODD McCLAY 
:—and they were listened to. We had great discussions. 
I will be very brief during this call because this is the last speech in the debate and Parliament is about to pass this bill. On 1 October the bill will come into effect. The bill will make a number of changes and it will make a number of changes for the 1000 worst youth offenders in New Zealand. The last speaker for the Opposition said that a small number of hardened offenders cause most of the problems in our society. I agree with her—but guess what? There are not just 1000. Every year those young people who commit crimes and get into trouble reach the age of 17 and they go on to fill up our adult prisons. Every year younger people start committing crimes and those 1000 young people stay in the group. What has happened over the last 9 years is that that group of 1000 young people has grown so it is about time the House took this issue seriously and did more to help these young people. 
The bill will expand the jurisdiction of the Youth Court to include 12 and 13-year-olds. This will enable the Youth Court to play a greater role in the support and rehabilitation of 12 and 13-year-olds who commit the most serious crimes. We are actually giving out a very important and very serious duty and power to the Youth Court. We heard from some submitters that there is concern that the Family Court had options available to it that the Youth Court would not have. Well guess what? The bill was changed so that a judge in the Youth Court can decide without intervention from others—members opposite or anybody else in this Parliament—whether a child should remain in that court or should be sent back to the Family Court. I have listened to the judges I have respect for them and I think that is an appropriate measure. 
The bill will also strengthen the Youth Court and expand its powers to give a new range of compulsory orders including parenting education. I would guess that the vast majority of the young kids who are getting into trouble and continuing to get into trouble from very early ages until they reach the age of 17 do not have family backgrounds that are the same as members in this House. I would guess that they do not have parents who spend enough time with them or care for them and therefore parenting orders to be directed by the court are a very good step in the direction of ensuring that parents realise that they have greater responsibility. Also provided are mentoring and drug and alcohol treatment programmes which are very important as we very clearly know that there are children who have problems with drugs and alcohol. 
I have heard about military style camps and this legislation will bring in such camps in order to bring respect and discipline to some of our worst repeat youth offenders. These camps are the most intensive intervention that there is in the bill and are intended to help get the lives of youth offenders back on track before they reach the age of 18 and end up in our prisons. There is also an option for longer supervision with residence; residence can increase from 3 months to 6 months and supervision can be up to 12 months. Another option is longer supervision with activity which is 6 months of activity and another 6 months of supervision. There will be more intensive monitoring. This is not just about children going before the Youth Court. It is also about judges being able to keep an eye on them. There is provision in the bill for electronic monitoring for repeat offenders and those who breach community orders. There is also judicial monitoring. 
I want to conclude so we can move on to other business but can I say to members opposite and to people listening this morning that we are not talking about young people who lead ideal lives. We are not talking about young people who have strong family support and backgrounds or supportive parents. We are talking about young people who have started on the path to serious repeat offending and we are talking about young people who are on a path directly to prison if the State does not intervene and give them more support. This bill gives those young people a chance and in some cases a last chance. I support it fully. Thank you. 
A party vote was called for on the question  
That the Children Young Persons and Their Families (Youth Courts Jurisdiction and Orders) Amendment Bill be now read a third time. 
Ayes 64 
New Zealand National 58; ACT New Zealand 5; United Future 1. 
Noes 58 
New Zealand Labour 43; Green Party 9; Maori Party 5; Progressive 1. 
Bill read a third time. 
Judicial Matters Bill 
In Committee 
Part 1 Amendments to Judicial Conduct Commissioner and Judicial Conduct Panel Act 2004 
Hon CHRISTOPHER FINLAYSON (Attorney-General) 
: 
 Perhaps I should make a few preliminary comments before Mr Chauvel makes a contribution. The main changes in Part 1 deal with the creation of the position of deputy commissioner. This person as with the commissioner will be appointed on the nomination of the House. The Attorney-General is required to consult the Chief Justice about the proposed appointment and the deputy commissioner will act when the commissioner has a conflict of interest or is otherwise unavailable to examine complaints. 
The provisions as reported back from the Justice and Electoral Committee are unchanged from the bill as introduced. There are however a couple of changes which are set out on Supplementary Order Paper 108. They relate to disposal of complaints and they are designed to give the commissioner a greater ability or a greater discretion to deal with complaints in a particular way. There are minor amendments to section 15 and consequential amendments to sections 16 and 17. 
CHARLES CHAUVEL (Labour) 
: 
 I would like the Minister in the chair the Attorney-General to amplify the comments he has just made about the Judicial Matters Bill. One of the issues that Labour has with regard to this legislation is that although Labour is supportive of the substantive provisions—as we originally advised during the first reading and as was our position at the Justice and Electoral Committee—it is of concern that the changes proposed on Supplementary Order Paper 108 in the name of the Hon Chris Finlayson are significant. Perhaps that is not so much the case in respect of the amendments to clauses10(1) 11 12 and 12A. I can see that the Minister would want to characterise those amendments as being machinery changes. I imagine that he will tell the Committee that those amendments are improvements that have been made on reflection and on the advice of officials following the select committee process. But I think it would be helpful if we were to have a little more explanation of why these changes are being introduced by means of a Supplementary Order Paper rather than through the normal process even if they are relatively minor. Indeed the changes may well be improvements. If they are and if the Attorney-General can enlighten us as to why that is it may well be that we will support those parts of them. 
I do though foreshadow a concern about the other matters that are proposed to be dealt with on that Supplementary Order Paper. They are more substantive matters but they do not relate to this part so I will not speak to them substantively. I do foreshadow to the Attorney-General that we have a concern about bringing them in in particular at this late stage without the scrutiny of a select committee or debate. That is a matter to which I will return. 
The other thing that would I think be useful to the Committee while members have the benefit of the presence of the Attorney-General as the Minister in the chair would be for the Attorney-General go back over the general philosophy of his party relating to the Office of the Judicial Conduct Commissioner. It is the case that as he acknowledged in his first reading speech initially the National Party opposed this office. I think in Chris Finlayson’s second reading speech on this bill we heard from him that that position had changed but we did not really hear why it had changed. Given the vehemence of the comments that came from him and his colleagues when the original measure came to the House it would be helpful if we were to get that sort of explanation. I remind the Attorney-General that at the time of the original proposal for the creation of the office he said: “This bill will not be supported by the National Party. The material dealing with the Deputy Judicial Conduct Commissioner is as misconceived as the contents of the substantive legislation.” Not only the amendment but also the whole notion of this process—this backstop measure; this measure of confidence—was something that National stood against. 
I think it would be helpful for the Committee to be given an explanation of National’s change of position given the relatively scant recantation that shall we say occurred at the second reading debate and given the substantive policy reversal that we now see. We are pleased about that. We do support the primary legislation as I have said. We think this is a useful measure to encourage confidence in the judiciary and we are delighted that the National Party has changed its mind and the Minister is now progressing with this legislation which began its life as a Labour measure. But given the vehemence with which National originally opposed the legislation given that we have not had a real explanation for its change of heart and also given that we have not really had the new provisions proposed in this part explained to us in any way or described in terms of how they are a correct and proper improvement it would be good to hear substantively from the Minister on those points. 
Hon CHRISTOPHER FINLAYSON (Attorney-General) 
: 
 The member Charles Chauvel raises a couple of substantive points that are worthy of reply. The first relates to the alleged call on the road-to-Damascus change of view. There was a real concern on the part of my party about interference with the conduct of the judiciary. Having spoken however to the Chief Justice and other members of the judiciary we found they were of the opinion that after a couple of years their initial concerns had evaporated and they felt that the post was relieving the heads of benches of numerous complaints that tended to be made and that there was a filtering system that was put in place. On that basis we were prepared to change our minds. Changing one’s mind is not necessarily a sign of weakness; it can often be a sign of strength I say to Mr Chauvel. What we are now seeking to do is to ensure that the commissioner is not placed under a huge burden with the number of complaints that are being lodged these days. Sometimes inevitably as the member will know in a relatively small jurisdiction there will be conflicts of interest or other reasons why the commission is unable to deal with the matter. That is why it is proposed that there be a deputy judicial complaints officer. 
As the member would know because he was in partnership with the commissioner Sir David Gascoigne for example a number of the member’s and Sir David’s former partners have been appointed to the bench and it would be rather difficult for the commissioner to have to deal with any complaints against those judges. That is why having listened to the judiciary and having listened to submissions on the part of the Law Society the Government or the National Party was prepared to change its mind. 
I come to the other point the member raised. If the member looks at section 15 of the Judicial Conduct Commissioner and Judicial Conduct Panel Act 2004 one sees that the commission is required to conduct a preliminary examination of a complaint and then the commissioner—if one looks at subsection (4)—may make inquiries into the complaint that he thinks is appropriate obtain documents and consult the head of bench. Then in subsection (5) having completed the preliminary examination the commissioner may take certain steps. The commissioner can dismiss the complaint refer it to the head of bench or recommend the appointment of a judicial conduct panel. 
Commissioners have found that for some complaints a complainant can be satisfied following an explanation or an apology by the judge. What normally happens as I understand it is the commissioner will write to the judge who is the subject of complaint and ask for at least a preliminary response. Then on the basis of that there may for example be an apology and that could be considered to be the end of the matter. The new section enables the commissioner not to take further action in respect of a complaint if the commission is satisfied that further consideration of the complaint would in all the circumstances be unjustified. It is really just giving the commissioner additional powers in order to deal with the matter. 
Hon TREVOR MALLARD (Labour—Hutt South) 
: 
 I want to speak on this part of the Judicial Matters Bill not to make an enormous substantive contribution but to ask the Attorney-General whether he thinks this is the sort of legislation that should be passed under urgency or whether this is the sort of legislation that should be carefully considered. There is a degree of agreement certainly around this part of it and one that has developed over a period of time; we think that is good. 
The question I have is whether the Minister as Attorney-General thinks it is good lawmaking practice to ram this sort of legislation through the House under urgency. The House is sitting under urgency and there is chaos. There was a point of order yesterday that took about one and a half question times—just for one point of order. The House has not been well organised. The Attorney-General as the chief legal officer of Parliament has responsibility along with the Leader of the House for process. The process under which this legislation is being addressed is shambolic and I want to know what responsibility he is taking for that. 
I want to know whether the Attorney-General has advised the Leader of the House that in taking this approach to this bill which it is fair to say is constitutional in its approach it is one that should properly be dealt with under urgency or using the words of Steven Joyce at the Cabinet table “whether the optics are good about this or not.” “Are the optics of this good?” I ask the Attorney-General or is the bill something that could probably have easily been dealt with in a much shorter period? We would not therefore be having speeches like this or I am sure like some that will follow other than under urgency. 
As I have indicated as far as this part of the bill is concerned Labour will be supporting it. Whether we will be supporting it to the closure is a discussion that we are currently having. It is good that we have a careful look at it. But is it necessary to waste Parliament’s time by taking a bill of this type? I do not want to say that it is not important and that there will not be some things later where there will be some more— 
Charles Chauvel 
: It’s important. 
Hon TREVOR MALLARD 
: Well the bill is very important but it is not urgent. It is also a bill that could have been dealt with on its merits rather than by having a big debate about the process—if the process had been organised properly. 
The essence of the point that I want to make to the Attorney-General is that he needs to take some responsibility. He was the one who was parading around town saying he wanted to be a QC or thinking he would be a QC before he became a member of Parliament. He was someone who was so upset on procedural matters that he might be turned down by a previous Attorney-General for that sort of thing; “prissy” I think was the word that was used around the place as to his approach. So I ask what has happened to those principles. What has happened to the Christopher Finlayson who wanted to be a QC and to the proper approach to lawmaking that he used to promote? He might have changed his mind on the substance of this bill and I congratulate him on catching up with people who were well-briefed back in those times. I think it is good that he admits now that he was wrong then. But does he think that this is the sort of process that should happen? Is he associating himself with Gerry Brownlee’s chaotic handling of this House over the last week? It has been absolutely chaotic; an opportunity was turned down to have things done in an organised and proper manner. He will get much much less through Parliament than he would have had he accepted that opportunity. Longer time was spent on one point of order than on an entire question time and now we have the chief legal officer of Parliament ramming constitutional legislation through this House under urgency in a manner that is just inappropriate. 
Dr KENNEDY GRAHAM (Green) 
: 
 I have already expressed in the second reading of the Judicial Matters Bill the Green Party’s support for this important but not urgent bill especially in regard to Part 1. But in this intervention I will address just one matter. In a sense it is a procedural matter not unlike that which has just been articulated. It has to do with Supplementary Order Paper 108 submitted by the Attorney-General. That Supplementary Order Paper would among other things insert a new section 16A as I understand it in the Judicial Matters Bill which in turn would amend section 9 of the District Courts Act 1947. That amendment would specify that higher duties allowances— 
The CHAIRPERSON (Lindsay Tisch) 
: The member is actually speaking on new Part 1A. We are on Part 1 so I ask the member to concentrate on Part 1. 
Dr KENNEDY GRAHAM 
: Thank you. I will wait until the next part comes up. 
Hon LIANNE DALZIEL (Labour—Christchurch East) 
: 
 I will follow on from the comments that my colleague Trevor Mallard made because we should not be debating this bill under urgency. I know that Hansard will record that this contribution was made on 23 February but I think that in fact—I do not have my diary with me—we are up to 25 February. That means that— 
Hon Trevor Mallard 
: Not in here we’re not. 
Hon LIANNE DALZIEL 
: Well for Parliament time stands still. Most people do not know about the effect of the urgency motion: the day stops on the day that the urgency motion is adopted by the House and then we are essentially extending the sitting hours of the House so that even though we get to go home to bed at midnight and come back at 9 o’clock in the morning in actual fact Parliament shows itself as sitting on the same day—in this case 23 February. 
Normally at this time I would be chairing the Commerce Committee—a very very good committee. I think that other members of the House would agree— 
Peseta Sam Lotu-Iiga 
: Good chair. 
Hon LIANNE DALZIEL 
: Good deputy chair over there as well. We are very effective. And Charles Chauvel would be chairing the Regulations Review Committee. He is a very good chair of that committee; it is a very good committee. 
Hon Trevor Mallard 
: No no. It sat this morning. We dealt with the business. 
Hon LIANNE DALZIEL 
: Oh! Well the point I am making is that other business of the House would be being conducted in other forums if this bill were not going through under urgency. 
I think Mr Mallard missed one essential point about the nature of this legislation. Even though we agree with Part 1—we were the Government that introduced Part 1—we will have a further debate about moving amendments under urgency to what is a constitutional bill. That is the point Mr Mallard did not pick up on—this is a constitutional bill. Judicial matters bills always are constitutional bills; that is why the Attorney-General is the Minister in the chair. 
This bill is not a matter for the Minister of Justice; it is a matter for the Attorney-General. I am very pleased we are debating Part 1. I also congratulate the Attorney-General on having the integrity— 
Charles Chauvel 
: The grace. 
Hon LIANNE DALZIEL 
: —the grace to say that after reflection on practice the situation is different from how he expected it to be. 
But there is a little bit that kind of sticks in my throat—just a little—and I thought I would cover some of the things the Attorney-General said when he was of a different mindset. First of all he talked about the ridiculous nature of the regime. He said that in 2004 National had opposed the substantive legislation. He said: “We said that it was an unwarranted attack on judicial independence and that it would encourage ineffective and stupid complaints—in fact that it would encourage a culture of complaints.” Later on in that same commentary he said: “Of course judges can be rude grumpy or discourteous. In many cases one can hardly blame them given the quality of submissions they have to hear from lawyers. But are we such a weak-kneed sissy society that if a judge barks at us we have to run off to some judicial complaints body?” 
I think that that was spoken by a true list MP. If that member had ever had a constituent in his office talking about how he or she felt about judges—not just the decisions but the way in which the constituent was treated and spoken to by the judge; sarcasm no eye contact—the member would know that those are all things that lead to a grievous sense of grievance. It is much worse often than it is at the beginning of court proceedings. 
I had such a constituent in my office last week and I can understand how he felt. I also understand the message the judge was trying to give but there was a total disconnect. Therefore there was a complaint. I see this judicial complaints process as a steam valve on what would otherwise be a pressure cooker environment. It is not for lawyers that the complaints provisions exist; it is for the ordinary people who live along the street who end up in a court environment and who find themselves on the receiving end of something more than rudeness grumpiness discourtesy or a lack of grace; it is a complete lack of a meeting of the minds. 
People often think they can effect change by court proceedings. I think that the Attorney-General and I would probably agree that that is not possible. So neighbourhood disputes end up in our courts when they should never end up there. People want to prove they are right so others have to be proved wrong but the court is not the place to prove those sorts of things. The Judicial Conduct Commissioner has really helped in that process. 
Hon DAVID PARKER (Labour) 
: 
 I rise to support the Judicial Matters Bill and also to record my support for the submissions that have been made by earlier speakers as to process. I think it would have been desirable if this bill had not been considered under urgency and I think it would have been desirable that the changes proposed by a Supplementary Order Paper were made in some other way. The points have been well made by earlier speakers and I will not add to them. Thank you. 
Hon DAVID CUNLIFFE (Labour—New Lynn) 
: 
 I rise to take a short call on the Judicial Matters Bill. I record Labour’s support for the bill and its opposition to the Supplementary Order Papers. As the previous two speakers have noted this bill affects matters of a constitutional nature. It is largely above politics and is about the conduct of judicial behaviour. The important place of the Judicial Conduct Commissioner in our system is recorded as is the need for judicial conduct panels. 
The main provisions of the bill include establishing the new office of the Deputy Judicial Conduct Commissioner appointed by the Governor-General on the recommendation of the House of Representatives after the House has been advised by the Attorney-General. The Attorney-General has to consult the Chief Justice on that recommendation. The function of the deputy commissioner is to carry out the duties of the commissioner in relation to complaints during his or her absence from office or incapacity. Of course on occasion the commissioner can face potential conflicts of interest and if those arise the deputy commissioner will be able to step in. That is all in the name of ensuring that the conduct review process is quite clearly beyond reproach as is appropriate and I am sure that the Attorney-General who is sitting in the chair would agree. 
The bill gives to the commissioner a power to take no further action in respect of a complaint if he or she is satisfied that further consideration of that complaint would in all the circumstances be unjustified. That is a magnificent legal truism; none the less it speaks to a point which is that there needs to be discretion on the part of the commissioner to decline to deal further with complaints that might be for example of a vexatious or frivolous nature or complaints that in the commissioner’s view are outside the powers or role of the office of the commissioner. That power is in addition to the three current powers to dismiss the complaint if it is vexatious to pass the complaint on to a judge who is a superior to the one subject to complaint or to set up a special judicial conduct panel. 
I guess it goes to the point that my colleague the Hon Lianne Dalziel made which is that we should not ignore the possibility that judges themselves can come under pressure. It is a difficult job. They receive variable submissions and they have to deal with a large number of clients who find themselves in all sorts of different circumstances. Judges come under some enormous time pressures and from time to time they can show that pressure. I think it is also important for us to note that judges are human. Judges themselves bring to the courtroom their own perspectives and they reflect their own backgrounds and from time to time unusual as it is those factors may cause a judge to demonstrate behaviours that might not in other circumstances be appropriate. It is also fair to say that a large number of our judges are male a large number of them are relatively senior in years and most of them are Caucasian. Those factors all bring a certain inherent perspective and it is important that we have processes that provide assurance to the public that no matter what the background or constitution of the judge they will be entitled to a fair legal hearing before the courts. 
I think members across this Chamber would be of the view that one of the great treasures of living in New Zealand is that we have a legal system that by and large functions pretty well and accords to New Zealanders the opportunity to have their business heard should they need to in a fair and just manner. That is why of course we have things like legal aid. It is important that justice is available for all; that cases are decided primarily on the merit of the case not on the size of the wallet; and that access to justice reflects the constitutional rights of every citizen. This bill is one small way of enhancing the process of further buttressing the review mechanisms within the process to ensure that unfortunate biases or errors of behaviour can be dealt with. As such in general the Labour Party supports it. 
Labour will be voting against Supplementary Order Papers 108 and 109 and I will take just a moment to explain why. According to the explanatory note Supplementary Order Paper 108 will give the commissioner an added option after the preliminary examination to refer the complaint if substantiated to the head of bench under section 17 of the Judicial Conduct Commissioner and Judicial Conduct Panel Act. Of course a number of consequential amendments flow from that amendment. It will increase from 140 to 156 the maximum number of District Court judges. It will authorise the payment of higher duties allowances to High Court judges serving in the Court of Appeal so that they rest on a more secure constitutional foundation—what a lovely turn of phrase. 
The CHAIRPERSON (Lindsay Tisch) 
: The substance of the member’s speech is now relating to new Part 1A. We are on Part 1. 
Hon DAVID CUNLIFFE 
: Thank you Mr Chairman for that clarification. I thought it appropriate to mention the overall position that the Labour Party is taking but I take the guidance of the Chair that it is not appropriate in this part of the debate to go into the detail of those Supplementary Order Papers. I merely record the fact that the Labour Party will be opposing both Supplementary Order Paper 108 and Supplementary Order Paper 109. 
In continuing I note that the current Attorney-General raised a number of objections when in Opposition during the first reading. He said: “That is the National Party approach—do it subtly but do it effectively.” I think that comment bears remarking upon perhaps more in its general context. A very active debate is going on in this country about whether the hallmark of the current Government is subtlety or effectiveness in the words of the Attorney-General. Those of the “subtlety” view including many in the business community are of the view that the Government is so subtle that it is almost impossible to discern its direction of travel. That has been one of the main responses of the commentariat to the Prime Minister’s opening speech to the House. Certainly in the economic policy area which is for a debate different from today’s there is a great deal of concern in the business community about whether the Government’s intentions are clear enough and whether there is a coherent strategy that would allow the economy to expand and create jobs. Labour members would welcome further elucidation of the Government’s intentions in that sphere because try as we might we are not quite sure how the so-called pillars of change add up to a substantial positive impact on the economy. That is the “subtlety” school of thought. 
The “effectiveness” school of thought which gives some members of the business community comfort is that the Government really does have a significant plan for change up its sleeve but it does not yet wish to tell New Zealanders what it is because they might not like it. The “effectiveness” school tends to the view that many of these things will be revealed in the Government’s second term if it is fortunate enough to have one and that in the second term we might see the Government showing a more—what would be a good judicial phrase? It could be “a more flagrant”—perhaps not. It could be “a more unmasked determination to deliver to core stakeholders” as they might put it. 
I am admittedly drawing a bit of a tangential bow from the as always perspicacious semantic approach of the Attorney-General. He has nailed National’s approach: “do it subtlety but do it effectively.” In so doing I think the Committee would congratulate this one office holder on unifying these two strands of thought about the nature of this Government. He has unified them in one sentence and he has said they are both right. 
Charles Chauvel 
: He’s their philosophical oracle. 
Hon DAVID CUNLIFFE 
: As my colleague has pointed out he is their philosophical icon—was that the word? 
Charles Chauvel 
: Their oracle. 
Hon DAVID CUNLIFFE 
: He is their oracle. He has gone beyond icon to oracle. No doubt we will be addressing him as Sir Christopher Finlayson before long. 
Hon Christopher Finlayson 
: No. 
Hon DAVID CUNLIFFE 
: The Attorney-General I am told is a republican and for that reason would not accept the title of Sir were it proffered. I see he is not rising to his feet. I wonder whether he wishes to clarify for the record whether he is a republican—my understanding is that he is—and whether he would turn down the title of Sir if offered but presumably not during the first term of office. Automatic knighthoods for all members of Cabinet are one of those second-term things. 
We look forward to the day when the true nature of this Government comes to full blossom. 
CHARLES CHAUVEL (Labour) 
: 
 I should clarify just one matter. After having consulted colleagues and having heard the Attorney-General’s explanation of the new changes proposed in Part 1 the Labour Party finds itself in the position of being compelled to vote against Supplementary Order Paper 108 in its entirety. This is a procedural point; it is about the undesirability of bringing this matter before the Committee both under urgency and by way of Supplementary Order Paper rather than through the select committee process. Obviously Supplementary Order Paper 109 the measure simply to divide the bill will not be opposed. 
The question was put that the amendments set out on Supplementary Order Paper 108 in the name of the Hon Christopher Finlayson to Part 1 be agreed to. 
A party vote was called for on the question  
That the amendments be agreed to. 
Ayes 69 
New Zealand National 58; ACT New Zealand 5; Maori Party 5; United Future 1. 
Noes 53 
New Zealand Labour 43; Green Party 9; Progressive 1. 
Amendments agreed to. 
A party vote was called for on the question  
That Part 1 as amended be agreed to. 
Ayes 69 
New Zealand National 58; ACT New Zealand 5; Maori Party 5; United Future 1. 
Noes 53 
New Zealand Labour 43; Green Party 9; Progressive 1. 
Part 1 as amended agreed to. 
Hon CHRISTOPHER FINLAYSON (Attorney-General) 
: 
 We now come to what is to be Part 1A. I will go through the motions notwithstanding the information of Mr Chauvel and then we will have to take further steps. As required by Standing Order 299 I seek the leave of the Committee to move the amendment to the District Courts Act set out in Supplementary Order Paper 108 which is the new Part 1A amendment to the Judicial Matters Bill. Leave is required because the amendment is a substantive one to an Act not amended by the bill as introduced. All parties represented in the Committee were actually consulted on the amendment and until this morning my understanding was that all parties had indicated they would support this course of action. 
The CHAIRPERSON (Lindsay Tisch) 
: Leave is sought for that course of action. 
Hon DAVID PARKER (Labour) 
: 
 I raise a point of order Mr Chairperson. I just seek clarification in terms of that consultation because there may be some misunderstanding here. If we gave an undertaking that we would support that legislation I would like that to be clarified before we take the vote if that is possible. 
The CHAIRPERSON (Lindsay Tisch) 
: My understanding is that the undertaking was for the support of the consideration—not necessarily for support of the amendment—so that the amendment can come back to be debated now. That is my understanding. Is that acceptable? Do you understand the position? 
Hon DAVID PARKER 
: Yes I think I understand the position. I was confused. 
The CHAIRPERSON (Lindsay Tisch) 
: Leave is sought for that course of action. Is there any objection? There is objection. 
Hon CHRISTOPHER FINLAYSON (Attorney-General) 
: 
 I move  
That the Committee report progress and ask to sit again presently. 
A party vote was called for on the question  
That the motion be agreed to. 
Ayes 69 
New Zealand National 58; ACT New Zealand 5; Maori Party 5; United Future 1. 
Noes 53 
New Zealand Labour 43; Green Party 9; Progressive 1. 
Motion agreed to. 
Progress reported. 
Report adopted. 
The ASSISTANT SPEAKER (Eric Roy) 
: I call Government order of the day No. 5. Is some member seeking the call? 
Hon Trevor Mallard 
: Mr Speaker! Mr Speaker— 
The ASSISTANT SPEAKER (Eric Roy) 
: Just a minute while I get some advice. It has to be a Minister I think. 
Hon CHRISTOPHER FINLAYSON (Attorney-General) 
: 
 I raise a point of order Mr Speaker. The issue that has arisen is in relation to a Supplementary Order Paper on the Judicial Matters Bill. What was proposed was that leave be sought— 
Hon Trevor Mallard 
: Mr Speaker he is talking to a bill— 
The ASSISTANT SPEAKER (Eric Roy) 
: Order! 
Hon Trevor Mallard 
: You have called a bill. 
The ASSISTANT SPEAKER (Eric Roy) 
: No I have a point of order— 
Hon Trevor Mallard 
: Yes you have called a bill Mr Speaker. 
The ASSISTANT SPEAKER (Eric Roy) 
: Please sit down. The member has raised a point of order. He said it was a point of order and I am hearing it. I have not yet determined whether it is a point of order but the member has raised a point of order and I need to hear it. 
Hon Trevor Mallard 
: He cannot raise it on a bill that is not before the House. 
The ASSISTANT SPEAKER (Eric Roy) 
: I will determine that. 
Hon CHRISTOPHER FINLAYSON 
: I am dealing with a procedural matter if the member would listen carefully. Because leave was denied in relation to part of Supplementary Order Paper 108 the House reported progress. Because of the numbers of people standing around here I was not in a position to stand up and move a motion in relation to seeking leave that the Committee deal with that particular part of the Supplementary Order Paper which is the motion that I was seeking to deal with. But you Mr Assistant Speaker then moved on to item No. 5 on the Order Paper. 
Hon TREVOR MALLARD (Labour—Hutt South) 
: 
 The first point I make is that that is not a point of order because it is not relevant to the bill that is currently before the House which is the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. There was an opportunity for and we were expecting Mr Finlayson to move a motion. We were waiting for him to move a motion; he did not. He missed it. What happened then was that the Clerk called the next bill and you offered the call repeatedly. I tried to get the call; my colleague Maryan Street tried to get the call. I tried to get a Minister to speak on the bill that is currently before the House. Neither of the two Ministers who were in the House the Attorney-General or the Minister for Social Development and Employment rose. You called repeatedly for a Minister; a Minister did not rise. I am not quite sure what happens now. I think possibly we might even move on to the next business. I think it is a matter of getting advice. But it is very very clear that the Minister now—and there has been one call on that bill—has an ability to adjourn the House if he wants to. He can take a call on that bill and adjourn the House or he can wait for another couple of calls and at that point move a motion to get the House back into Committee. But for at least two calls now a Government call and an Opposition call we are on the student loan legislation. 
Hon DARREN HUGHES (Senior Whip—Labour) 
: 
 I was watching events on television—this is a high-rating programme—and saw what happened. I clearly heard you call Government order of the day No. 5. I saw the Clerk stand and read out the name of that bill. I then heard although the microphone was not live the unmistakable sound of the call of Mr Mallard saying: “Mr Speaker! Mr Speaker—” and I heard you say that you were seeking advice. 
Clearly Mr Mallard cannot be the first speaker on a Government bill because a Minister is required to move a motion with regard to the second reading. Mr Mallard points out that neither Minister present in the Chamber did move so so we are in a quandary. There is no question that we have moved on from the Judicial Matters Bill; I think that is clear. We have called Government order of the day No. 5 and we are on to that. However I see that the Minister of Revenue Mr Dunne has arrived. The bill is in his name. I think that for the best sense of order the most appropriate thing would be for Mr Dunne now to move the second reading of this bill so that we can proceed. Otherwise I think we are at an impasse that cannot otherwise be resolved. I cannot seek leave on behalf of another member but we would have no objection if Mr Dunne sought leave to take a call at this time. 
Hon Trevor Mallard 
: Speaking to that— 
The ASSISTANT SPEAKER (Eric Roy) 
: I do not need any further assistance. I think the only thing we are very clear of is that the House is in a somewhat confused state. Even in the report of the proceedings in the Committee there was some question about how that was summed up and presented. I can understand there being some element of confusion about that. Consequently the Hon Christopher Finlayson may not have had quite the opportunity to make the point he was going to make. In any case I have called Government order of the day No. 5. Only a Minister can respond to that and that is why I could not give the call to the members who were both seeking it. I think they understand that. I am prepared to take a call from a Minister on Government order of the day No. 5. 
Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill 
Second Reading 
Hon PETER DUNNE (Minister of Revenue) 
: 
 I move  
That the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill be now read a second time 
. The measures in this bill are part of continuing efforts to ensure that the student loan scheme is managed in an efficient and consistent way. They include a suite of mainly technical changes to the repayment rules to ensure that the law is clear and consistent and that it operates as intended. The bill also extends interest-free loans to borrowers from Niue the Cook Islands and Tokelau which share a special relationship with New Zealand that is sometimes referred to as their being part of the Realm of New Zealand. I note that when I used that term in an earlier debate Mr Hayes I think took some exception to it but I quickly reminded him that it is the phrase that the Governor-General often uses in such situations and without bringing him into the debate I think it is appropriate to follow his guidance. Because the Ross Dependency is also part of the Realm of New Zealand borrowers who go there may also qualify for an interest-free loan. 
The 183-day requirement for borrowers to be present in their country is the same criterion that must be met by New Zealand - based borrowers to qualify for interest-free loan status. That requirement is in place to encourage borrowers to remain in New Zealand or to return home from overseas to make their contribution to our economy and growth. The bill applies the same 183-day requirement to borrowers from what we now describe as realm countries so that they have an incentive to return home after their study and make a positive contribution towards the economic and social future of their particular country. 
This bill also acknowledges the value that students who pursue further study overseas bring to New Zealand and extends interest-free loans to include students furthering their education overseas through full-time study under formal exchange programmes or formal agreements between New Zealand and overseas tertiary education providers. 
I acknowledge the work of the Education and Science Committee on this bill; it made several worthwhile refinements to it. The first of these extends the overseas exemption to include those engaged in full-time study overseas if their New Zealand tertiary provider has confirmed that their studies cannot be completed in New Zealand but would count towards a New Zealand qualification at level 8 or above. The other small but important change provides greater clarity by defining the term “overseas tertiary provider” so it is clear what type of organisation borrowers must be engaged in full-time study with overseas in order to qualify for interest-free loan status. 
The remaining changes in the bill are largely of a technical or remedial nature to ensure that the law works as intended. Briefly they include an amendment to correct an unintended change to the hardship relief provisions made by the Student Loan Scheme Amendment Act 2007 a change that allows the Inland Revenue Department to raise the compulsory deduction rate from 10 percent to 15 percent to help ensure that borrowers pay their correct loan repayment amounts and the removal of a technicality so that borrowers returning to New Zealand who wish to fully repay their loans before they have met the 183-day requirement to qualify for an interest-free loan can do so. 
They are the main features of the bill. I record my thanks to the select committee for its detailed consideration of this matter and for its thoughtful recommendations which have made for further improvement and clarity in this bill. I think that overall these changes will help ensure that the student loan scheme works in the way that it was intended for both borrowers and the Crown and consequently with great pleasure I commend this bill to the House. 
Hon MARYAN STREET (Labour) 
: 
 I rise basically in support of the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill but to begin with I need to draw attention to the complete shambles that has developed in this House because of the taking of urgency. This may be the one bill in the whole panoply of bills that the Government has put up under urgency that actually warrants urgency because some action is required to be taken by 1 April. But this bill is about the only one that does. Even this bill was teetering on the brink of not being able to be introduced into the House for its second reading because there was not a competent Minister in the Chamber to move the motion. The Government whips had no sense of anticipation that because of the shambles that was developing over the previous bill under consideration they needed to alert the Minister in charge of this bill the Hon Peter Dunne to get to the House promptly so that he could take it up. In the event two Ministers the Hon Chris Finlayson and the Hon Paula Bennett were sitting in the House but neither of them had the wit to get up and even move procedurally or do some kind of form speech while waiting presumably for the whips to ring the relevant Minister’s office to get the relevant Minister to the Chamber pronto. 
This is a complete shambles. This is what happens when a Government tries to avoid question time when it has been trying to use the procedures of this House in order to defend indefensible Ministers. This particular bill warrants urgency. I am—and we in the Labour Party are—perfectly happy to acknowledge that it warrants urgency. We support this bill. But this cannot go past without some trenchant criticism of the process by which we have got to this moment. In the urgency motion there was a raft of legislation that did not need to be taken under urgency. It was clearly a ruse and a device that allowed the Government to let its panicked panicky Ministers—such as the Minister of Education Anne Tolley or the Minister of Housing Phil Heatley—to get off the hook and not be subjected to the kind of grilling their performance in the task of being a Minister of the Crown absolutely demands that they be subjected to in the process of question time. This cannot go past without comment. Although we are now at the second reading of the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill I have to say that it is only by the skin of its teeth and by some cooperation on our part that this bill is reaching this stage in any kind of order. That fact goes to the competence of the Leader of the House Gerry Brownlee and to the attention paid by the Government whips to what is actually transpiring in the House as we proceed. 
However there is one other thing I wish to raise in relation to the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. Between the time this legislation was first introduced into the House was referred to the Education and Science Committee and appeared for its second reading we have had a change of Minister for Tertiary Education. Although this is a bill that rightly comes under the purview of the Minister of Revenue it will be interesting in the Committee stage if the new Minister for Tertiary Education responds to some of this debate so that we can discover whether the Minister of Revenue has briefed him about this bill. This is about the student loan scheme it is about miscellaneous provisions and it refers to exemptions. It will be interesting to see whether the fact that the new Minister Steven Joyce—who was brought in to repair the damaged and broken relationships between this Government and the tertiary education sector which resulted from the stewardship of the previous Minister for Tertiary Education—has student loans in his sights has any bearing upon this current legislation. 
This legislation extends the student loan scheme to all those within the Realm of New Zealand and that is a good thing. We support that despite the fact that there are not many in the Ross Dependency who are likely to take this up—we may have the best educated penguins in the world. We are supportive of the extension of the scheme to people in Niue Tokelau and the Cook Islands. However I am somewhat at a loss to know quite what the direction of the student loan scheme will be under the new Minister for Tertiary Education. He has made it explicit that although he acknowledges it was a political call to maintain interest-free student loans—in other words the Government would have taken a real drubbing on this issue at the general election had it not decided to continue to support it—he has decided that he will make it harder for students to access student loans. This is clearly on the agenda of this Government under the new Minister. The previous Minister’s relationships with the tertiary sector were in such a parlous state that she was beginning to not even meet with them any longer. 
Carmel Sepuloni 
: She was in a helicopter flying over them. 
Hon MARYAN STREET 
: She was busy in helicopters. However the point is that we have had a change in direction around student loans from the new Minister. If he makes it harder for people to access student loans how does this legislation which extends student loans to people throughout the Realm of New Zealand in that old terminology square with the new Minister’s intentions? Will the loans be harder to access? 
One of the provisions in this legislation will permit the Commissioner of Inland Revenue to increase the standard rate of repayment deductions from 10c to 15c in the dollar where borrowers have failed to have correct deductions made or failed to pay any other due amount. I understand the Green Party’s objection to making that burden harder but I think it is also incumbent upon the Government to ensure that people are not abusing and misusing the scheme. The vast majority of students whom I know and to whom I talk have been deeply grateful for an interest-free student loan policy because they absolutely need this money to get through their studies. The amount of abuse is infinitesimal compared with the number of those who use the scheme for its correct purpose. 
We support the bill albeit recognising the Green Party’s objection in its minority report from the select committee. We are not objecting to incentivising people to pay back their loan. However I do not see how this legislation as it stands now will fit in with the Minister’s express desire to make it harder for students to access loans therefore making it harder for people to access tertiary education and therefore reducing the number of students in our tertiary institutions which will reduce the expense to the Government. I hope that the Minister of Revenue has already taken this up with the new Minister for Tertiary Education. Thank you. 
COLIN KING (National—Kaikoura) 
: 
 It is a pleasure to take part in the second reading of the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. I start off by pointing out that National did commit to keeping interest-free student loans in place. We recognise that the scheme is a very generous contribution by taxpayers to tertiary education students so we want to see that the whole process around the student loan scheme is tidy appropriate and fair. That is the very essence of this bill. It tidies up a number of areas enhancing the student loan scheme and giving people certainty and clarity. We need to do that because 500000 New Zealanders have student loans. Therefore the scheme has a significant impact on the Crown accounts as a debt to be managed. It is in the region of $10 billion. We want to ensure that those people who enter into a student loan get quality education and that the country in return receives the most benefit from those people’s higher education by way of completions success and the students realising their potential. 
One concern we have in Government on this side of the House is that under the previous administration there was a total lack of incentive to repay one’s student loan. In fact there was a general sloppiness in the behaviour of the tertiary education sector. That is why the Government in September introduced the 10 percent bonus repayment which means that if people pay over $500 of their loan above their minimum requirement we give them a benefit or a bonus on that. 
This bill has come through the House courtesy of the Minister of Revenue who has oversight of it. I encourage everyone in the House to go on to the website and download the annual report relating to the student loan scheme. It is quite staggering to read. The principle itself is a good balance. In the context of this bill and the student loan scheme there is an enormous amount of public good but done properly there is an even greater amount of individual good. That is what we want to see. 
I will get on to the bill and interest-free loans for residents of the realm countries. We do a lot to aid those countries within our region—and when talking about our region I am referring to the South Pacific effectively—be it Niue Tokelau or the Cook Islands. Those countries have rights under our laws and one of those rights is access to interest-free student loans. Up to this date when those students came to New Zealand that was the case but when they returned home it was not the case. This bill appropriately extends the provision so that students can continue to have interest-free loans when they return to their home Islands. That change is very good because it benefits not only the Islands but it also balances out students’ rights to the student loan scheme. Otherwise invariably those students would stay in New Zealand in order to keep that right. Those Islands have an enormous need to be supported and to grow economically and one hopes that those things are gained from the student loan scheme. The change will apply when the bill is brought into law. 
This bill deals with a very interesting aspect of overseas study. At present there is a gap in our education system. At times there is no ability for students to continue their studies overseas on an interest-free loans basis even though there may be a formal relationship between an institution in New Zealand and an overseas institution. This bill addresses that matter. Where there is a formal agreement between the New Zealand tertiary education provider and an overseas tertiary provider there will now be the opportunity to retain the status of an interest-free student loan. 
Up to this date as soon as a student left the country to study or work the calculator would start ticking away. I trust that we can manage this change. We will need to register what those institutions are and what courses are being taken. The education needs to be at that higher level and one that is not provided in New Zealand. That in itself is fair but we must remember that when the interest-free student loan scheme was implemented it came to the attention of the Minister of Revenue that some 40000 students overseas were claiming interest-free student loans but were not really deserving of them so that had to be tidied up. Exemptions are an important aspect of bill and we look to this amendment to tidy up matters respectfully around that issue because we want the full ambit of opportunities to be opened up to students whether they are doing a master’s degree PhD or whatever. 
The other aspect that I thought would be controversial with regard to the Green Party minority view is that the Inland Revenue Department will have the ability to increase the rate of repayment deduction from 10c to 15c in the dollar for borrowers who have failed to have the correct deductions made or to pay any other amount when it is overdue. It became clear under examination by the Education and Science Committee that that provision does not include the occasion when there is failure by the Inland Revenue Department to send out the appropriate notification of payments. It would be unfair to be ruthless and try to claw that money back in an insensitive way. However in many situations the department needs that flexibility. When we are talking about 10c to 15c in the dollar it is not just one or the other; it is a sliding scale. 
This is a small bill and although some speakers in the first reading debate said there was not a lot of substance to it it is an important aspect of the legislation going forward. The bill adds to critiques and improves the Student Loan Scheme Act 1992. It is a balanced bill and generally speaking on the select committee we worked collegially and the advice we received from officials was very appropriate. The bill in the form returned to the House is still in much the same vein as it was at its first reading. The committee made a couple of recommendations and it was good to see that the Minister has picked up on those. On that basis it is a pleasure to commend this bill to the House in the second reading. 
STUART NASH (Labour) 
: 
 My colleague Grant Robertson said to me a moment ago: “Get ready to jump up; it sounds like Colin’s winding down.” but he said that from about the first minute of Colin King’s speech. I wonder whether Colin King has any interest in education or whether he was given that speech and told to read it because we are 2 hours early due to the earlier stuff-up in the House. He should show a bit of passion about education. 
I think that education is the most important thing we can do for our children and our communities. That is why I stand now to speak in support of the second reading of the bill. It is hard to believe that the first reading was in August last year. Too many important bills affecting the people of New Zealand have been rushed through the House under urgency since then. Goodness me! We are only into the third week back this year and already we are rushing legislation through the House in what appears to be a slap-hazard way. I assume there must be some sort of plan or logic to the process— 
Chris Hipkins 
: That’s a bold assumption. 
STUART NASH 
: Yes I know. I certainly cannot follow it. I do not know whether Mr Hipkins can. Can anyone follow this? I do not think so. I do not think that the lack of process or progress is what the people of New Zealand voted for. There is a lot of stuff going on at the moment that I do not think the people of New Zealand voted for. 
This bill by and large is a technical bill. The previous speaker said it did not have much substance. Well it does have quite a bit of substance but it is a technical bill. It enshrines a couple of important philosophies that we as the Labour Party strongly value. That is one of the main reasons why I support this bill. The Labour Party has always seen the fostering of the economic development of our Pasifika brothers and sisters as one of its major responsibilities and goals. This bill also builds on Labour’s fantastic law of giving interest-free student loans to all students and what wonderful legislation that was. It was of course as we all know Labour legislation. 
Education has to be the cornerstone of economic development and in my humble opinion the interest-free student loans legislation was one of the greatest pieces of economic development legislation passed in a generation. It certainly passes the Nash test of: “Is it right for the people of New Zealand?”. 
Grant Robertson 
: I thought that was Harry Holland’s. 
STUART NASH 
: In talking of Harry Holland I had to smile last night in this Chamber when Mr Macindoe was putting words into the mouth of the great Harry Holland one of the Labour Party’s great early leaders. I mean no disrespect to the member from somewhere in Hamilton but those who know their political history will know that Mr Macindoe has a few more years of sweating blood for the people of New Zealand before he can even start to speak on behalf of the great Harry Holland. Sir Roger Douglas will know that will he not? Harry Holland was a great man but I digress. 
This bill makes some technical amendments but by and large it does three things. Firstly it allows those from the nations of Niue the Cook Islands and Tokelau and the Ross Dependency who have come to New Zealand to seek educational opportunities to return home in order to put their education and learning into practice. Secondly it provides an incentive to those currently resident in the aforementioned countries to come to New Zealand to be educated and then return home to families friends and jobs while achieving the same advantages as citizens domiciled already in New Zealand. Thirdly it provide opportunities to New Zealand citizens who may wish to travel to Niue the Cook Islands Tokelau or the Ross Dependency in order to pursue professional opportunities for any number of reasons. 
This bill also allows interest-free loans for students engaged in full-time study overseas under a formal exchange programme approved by the New Zealand Government or a formal agreement between a New Zealand education provider and an overseas tertiary education provider. In this day and age of globalisation that is a wonderful thing so I commend the Minister of Revenue for that. 
In my speech in the first reading debate I said I had a grave concern that the National Government would look to repeal the interest-free student loan provisions which would therefore necessitate my being back in this House within 2 years in order to repeal the amended legislation. Well why do we have it? I suppose Mrs Tolley was never going to do it. She had enough problems as it was and loading the repeal of the interest-free student loan scheme upon her already fragile shoulders would probably have just been too much. So Mr Joyce was given the task. Are we surprised? Absolutely not. 
I tell members that as soon as the Labour caucus heard that Mr Joyce was being appointed the Minister for Tertiary Education we knew that it spelt trouble for current and aspiring students. In fact it probably spells trouble for every person who has a student loan and is not paying interest at the moment. But at least Mr Joyce is honest. Well he is honest on this: he said that his supporting the student loan scheme when he was the campaign manager for the National Party was a political call. That is nice! There was no philosophy or idealism behind that; it was a political call. At least we know what he believes in—nothing. 
The irony about National’s planned removal of the interest-free student loans scheme is that the vast majority of members on that side of the House who went through the tertiary education system did so when it was free yet here they are taking away those opportunities for students who now want to study and better themselves. That is amazing actually. 
This bill as it stands is apparently aspirational. With regard to this bill the Minister of Revenue Mr Dunne said: “This is another positive step that will allow people to further their studies overseas in a way that will benefit New Zealand in the longer term.” and I totally agree with the Minister. That is one of the reasons as I said why I am supporting this bill. But with all due respect I ask this question: what about those who live here and want to stay and study in New Zealand? The National Government is about to steal the educational opportunities of thousands of New Zealanders and that is simply not fair. It represents incorrect priorities. Well let us see where the money has been stolen from. We are talking about just money stolen from education here not from elsewhere. There is the $11 million from the training incentive allowance that the Prime Minister Minister English and every other National MP Maori Party MP and ACT MP have stolen from those who can least afford to get into education. That is $11 million gone. I am talking about solo parents who make a proactive choice to engage in education whilst they are bringing up their children. They have suddenly had their opportunities taken away—gone. The Government has cut them out; it is unbelievable. Where are the priorities? That is dreadful. 
What else has been taken away? The guidelines for healthy food in schools have gone. The Government has slashed burnt cut and got rid of that. It has taken that away. Those members have taken away the funding for those who require it most. Where else has the money been taken from? It has been taken from high school night classes. It is unbelievable. Money has been taken from adult and community education. 
Where has the money gone? I can report that about $35 million has gone into private schools and I wonder whether that is fair. Thirty-five million dollars was stolen from the poor and given to the rich. 
Paul Quinn 
: What private school did you go to? 
STUART NASH 
: I tell Mr Quinn that I did not go to a private school. I believe in the State sector. I went to an incredibly good State school. 
This Government is Robin Hood in reverse. We have the modern-day Sheriff of Nottingham or the “Sheriff of Nothing”— 
Paul Quinn 
: Hey! I went to a private school and I’m proud of it. 
STUART NASH 
: And look what it did for that member. Goodness me! I would not mention the school’s name if I were Mr Quinn because it would be embarrassed to have him as an alumni; there is no doubt about that. 
What else is this Government doing? It is raising GST to 15 percent. That will help everyone will it not? I just cannot understand the logic. So $11 million has been taken from the training incentive allowance and $13 million has been taken from adult and community education classes yet $35 million has been given to private schools. Yeah that is about equality is it not? 
Amy Adams 
: At least they teach their kids to read. 
STUART NASH 
: Wow! That is an interesting assertion is it not? That member said that State schools do not teach their children to read but private schools do. That is a damning indictment on the teachers who teach in the State education sector. Imagine saying that; it is unbelievable. The reason that member would not send her children to a State school is that only the private sector teaches children to read—the State sector does not. I can inform the member that that is not true at all. The State sector has some of the best teachers in this country and it does an amazing job. I take that as a slight against every teacher who teaches in the State sector. It is unbelievable. 
National has never had a mandate or a belief system and that has just proven it. That is why those members can slash and burn and make those sorts of comments to such an extent without any conscience. I can tell this House that under the next Prime Minister the Hon Phil Goff Labour will bring principled spending back to education. We believe as we have always believed—it is what the Labour Party stands for—that the people of New Zealand demand and require the sound education system they had under Labour. The Government side of the House is taking away opportunities. This bill though provides opportunities and that is why I commend it to the House. Thank you. 
CATHERINE DELAHUNTY (Green) 
: 
 Tena koe Mr Assistant Speaker Roy. The Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill has some merit but the Green Party has looked at it closely and in context and on balance we remain opposed to some of its key provisions. We may be a lone voice in the House and easily dismissed as unreasonable because some good ideas are cemented by this legislation namely the extension of interest-free loans to borrowers from Niue the Cook Islands Tokelau and the Ross Dependency. The Green Party is delighted to see the principle of interest-free loans being expanded to these communities. We hope this indicates recognition by the Government that education can be made inaccessible by both geography and market principles and that the State can positively assist access to tertiary study. But under the new Minister for Tertiary Education we are not holding our breath and under the previous Minister we were not either. There may not be many students in the Ross Dependency at the moment but who knows? If we stick to the current pathetic climate targets the area may become warm enough in the lifetimes of our children for a whole university. 
The Green Party applauds also the modifications that have been made to the bill since the select committee process. They have resulted in the Inland Revenue Department accepting after a little bit of pressure that it made a mistake in not notifying some students about overdue loan repayments and therefore could not penalise them. There was a proposal to enforce a 15 percent repayment penalty on those students but fortunately—after some discussion at the Education and Science Committee which I was happy to persist with—the department withdrew support for that idea. This is a good example of the value of select committees in highlighting anomalous provisions that would create unintended consequences and unfairness and the change is well made. 
We remain concerned about this bill mainly because of the late payment penalties. As the New Zealand Union of Students’ Associations stated in its submission the increases proposed to the compulsory repayment deduction would be unmanageable and unacceptable. Student loan repayments kick in at the very low threshold of $19084 and now is one of the worst possible times to increase student repayment rates. Whatever the optimistic economists and politicians choose to say we are in recession. Many students are part of the low paid and underpaid. They are struggling to meet rent food and clothing costs let alone debt. This especially applies to women students and to former students who are yet to experience pay equity in many occupations let alone in the public sector. It is all so easy for  
Campbell Live 
 to focus on the minority of irresponsible young people who wasted their money on inappropriate goods and behaviours. However they are not necessarily the people who will be hurt by the increase in late repayment fees. Even they are merely reflecting back to us the lessons we have taught them: that they can have it all that they can borrow and spend and that they can live with debt because they are worth no real investment and they must bear the risks. 
The relationship with debt that the student loans scheme entrenches is one of the most insidious and destructive processes invented. In a world where shopping for the latest goods and experiences that global capitalism can provide is promoted to everyone on every screen we cannot blame the young for wanting it. Then we lend them money for their education. First there was the crippling interest on all those loans and all students and then there was interest on overseas students only. Now there are murmurings of more changes to the student loans scheme by the new Minister for Tertiary Education Steven Joyce. 
It is pretty clear that Mr Joyce was not given this portfolio just as something to do while eating his lunch in between building more unnecessary motorways and that the student loans scheme could always be made worse for students. This was also signalled in the Prime Minister’s statement to this House when he waxed lyrical and said he wanted “a careful look at … student support and allowances to ensure that taxpayers’ generosity is not being exploited”. What did he mean? He is really concerned about the public getting their money’s worth but students are also members of the public and they are not getting their money’s worth. Now Steven Joyce is rolling up his sleeves to see what can be done about it. The political risk of reintroducing interest on loans seems too high right now but as Steven Joyce said last weekend “we’re going to look at other requirements around those student loans”. What does Mr Key mean by taxpayer generosity? Does he mean that all of us older politicians who had no student loans are being awfully kind by indebting the next generation and that we will demand more blood? What does Mr Joyce mean? Could he be referring to eligibility to enter study or to remain there? Will that be tightened? None of this is good news for students. 
In the meantime this bill causes concern for the Green Party mainly because of new section 20A(2)(a) which allows for an increase in the standard deduction rate of 10c in the dollar to a maximum rate of 15c in each dollar. Clause 20 which relates to section 55 talks about hardship relief. Considering that many many students are in hardship they might need to think about this provision because it could apply to a lot of people the Government is about to impose extra penalties on. If the Commissioner of Inland Revenue considers that a repayment obligation would cause serious hardship he or she can offer hardship relief. But as serious hardship is not defined and would have to be proven very many people are unlikely to be able gain this form of protection from clause 20. 
We are very concerned about adding debt to people who are already failing to repay. It does not incentivise; it punishes. This is a bit like environmental pollution whereby the burden of proof is always on the citizen and not on the polluter. The burden is on students to prove they are in hardship. Students have no choice but to have a debt if they want to study and if they are not wealthy they cannot always earn their way out of it. At the select committee there was much talk about how students could earn their way out of debt. So many people I know who have left university are not earning their way out of it because they are barely managing to live let alone get a mortgage and their student loan is still a huge burden on them. They are not progressing financially in the way that my generation just took for granted. It is purely unfair. It is a real indication of the value we put on our student body and the value we put on our society as a whole. The poor cannot earn their way out of debt when they start off with debt as young people. That is something I did not experience. 
We oppose the additional burden and the burden of proof being on students to prove that they are in hardship. We are opposed to the provisions of the bill to such an extent that we have to vote against the bill. Although we thought there was good discussion at the select committee about all the different aspects of the extension of interest-free loans and we support that extension we are deeply in opposition to clause 20 which adds to the hardship. It is just not fair to use the student loan scheme as a way of keeping people in poverty. To say that it is a debt on the country is true but we have to take responsibility for the debt that was created. We created that debt when we created the student loan scheme. Many people out there today know what I am talking about because they have not earned enough. Women migrants and refugees tangata whenua Pasifika and people with disabilities have absolutely no chance of the high-wage economy that the student loan scheme assumes is behind people’s ability to repay loans. So the Green Party will continue to be consistent and principled in our attitude towards the student loan scheme and towards added burdens on young people in their education and in future life and we will not support this bill. Kia ora. 
LOUISE UPSTON (National—Taupo) 
: 
 I am very pleased to stand and speak in support of the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. That is the bill we are talking about. It is actually in the name of the Minister of Revenue Peter Dunne but unfortunately some of the Opposition members keep mentioning other Ministers in the House so it would be very helpful if they could remember that. This bill is in the name of the Minister of Revenue and it is a technical bill that makes some changes. I am very pleased that I am able to remind members on the opposite side of the House of that and to correct the error of their ways. 
I want to agree with other speakers today on one thing: I want to agree with an earlier speaker from the Labour benches who said that education is the cornerstone of economic growth. Clearly a National Government totally agrees with that: education is a massive platform for us in terms of growing our economy and we are extremely committed to having in place a student loan scheme that is balanced. But the important thing is also to put the right incentives in place to support and enable people to pay off their student loans faster than at present. 
I just want to put a bit of context around this bill in this second reading. We have heard from the Minister of Revenue that more than half a million New Zealanders have a student loan. Half a million—that is a huge number. On the one side it is fantastic that there has been that amount of uptake; obviously the number of people in tertiary education is high in this country and we need it to be. But one of the difficulties when as many New Zealanders as that have a student loan is that the scheme has a significant impact on our economy. I remind members on the other side of the House that hard-working New Zealanders who pay tax fund the student loan scheme. There are not just poor students with student loans; poor hard-working New Zealanders pay tax from their income to support the student loan scheme. That is another important context that I want to put across. For some people the Government’s money grows on trees and everyone gets to write fat cheques with it. No it is hard-working New Zealanders who fund the student loan scheme. 
When National came into Government it was concerned that under Labour there had been no incentives whatsoever for people to repay their loans earlier than they had to. That meant that loan holders were likely to be in debt for longer than was necessary which we know is not good for anyone. That has implications and flow-on effects for other areas of former students’ lives: delaying choices about whether to have a family when to have a family and whether to buy a house. National has fulfilled its election commitment to keep interest-free student loans for tertiary students. Part of that was also a commitment to build in a strong incentive for students to pay off their debts faster. That is great behaviour for us to reward because we believe that education is the cornerstone of economic growth. 
In effect there are three areas in this bill that I want to touch on. The first area relates to interest-free loans for the realm countries. This is particularly important to me as there is a large Pacific Island population in the electorate of Taupo so I am very keen to support the development of education for those people as well. The second area relates to the overseas study provisions and I want to talk about a case that I have had in my Cambridge office of a constituent who wanted to study overseas. The third area is the minor and technical amendments which for some reason members on the other side of the House seem to think are unimportant or boring but there are very important technical changes included in this bill. 
Let us look at the first area the interest-free loans for residents of realm countries. Many of the speakers today have talked about the importance of our support for Pacific countries. This means that borrowers in realm countries will be exempt from the requirement to be present in New Zealand in order to qualify for an interest-free loan. That is fair; it makes a lot of sense. It recognises the special relationship that we have with the realm countries. If we go back a step and look at the situation when interest-free loans were introduced in 2006 we see the scheme encouraged borrowers to remain in or come back to New Zealand. That was part of its intention. Niue the Cook Islands and Tokelau have a special relationship with New Zealand that gives their citizens the automatic right to reside and work here. So we wanted to extend the interest-free loans to borrowers who reside in these countries in order to recognise that special relationship. That is the first area of the bill—interest-free loans for residents in realm countries. 
The second area relates to overseas study and there was some very interesting discussion in the Education and Science Committee around this particular measure in the bill. One of the issues is that when people want to study overseas the situation generally is not that they want to study overseas but that they want to extend their existing study and sometimes the course that they are interested in is not available in New Zealand because of its speciality or because they want to pursue a very technical field. I have had a case of that very kind in my electorate. A constituent came to see me because her daughter wanted to study in a very specialised field and the course was not available in New Zealand. We do not want to be in the position where we restrict students’ choice by limiting their study options so this bill introduces an extension of the interest-free loan entitlement to students who are studying overseas full-time where the New Zealand Government has a formal exchange programme in place with the education provider. It means that students who want to pursue further studies in very specialised fields have that option available to them. In a case in my electorate of Taupo that was a very relevant consideration and this particular clause will be helpful for that student. 
The third aspect of the bill is the minor technical amendments. Members on the other side of the House may say that this is the not very exciting bit. Well I totally disagree with that. I think that the minor technical amendments are a critical part of this bill. Several matters are dealt with in this area of the bill. The Green member Catherine Delahunty spoke about hardship and it is fair to say that many New Zealanders are experiencing hardship at the moment. This particular measure looks at students who are repaying their loans and makes some minor changes. Currently the availability of relief is limited to the year that immediately precedes the current tax year. We as a Government want to make sure that students know about their obligations in terms of their debt. We have provided incentives for them to repay debts earlier. With regard to these changes there will be some students who unfortunately fail to have the correct deductions made or who need to pay amounts that are due so a change has been made in the deduction rate. There are also changes in some other areas relating to the early repayment of a loan and the grace period. 
This is important legislation and I am proud to support it in its second reading. 
GRANT ROBERTSON (Labour—Wellington Central) 
: 
 I thank Louise Upston the previous speaker from National for her reminders on various matters during her speech. Members on this side of the House however were a bit disappointed that Maurice Williamson did not take that call because earlier in the debate we heard the great quote—probably the quote of the year actually—from Mr Williamson: “Slash and burn never hurt anyone.” 
Chris Hipkins 
: A bit of slash and burn. 
GRANT ROBERTSON 
: “A bit of slash and burn never hurt anyone.” If only Mr Williamson had taken a call then we could have heard a little bit more about what he meant when he said that a little bit of slash and burn never hurt anyone because that is really National’s agenda when it comes to tertiary education. I have respect for Mr Williamson; he says what he thinks. He says what the National Government really thinks—that a little bit of slash and burn never hurt anyone. Well we have certainly seen a little bit of slash and burn in the tertiary education sector and I think we will see a little more to come. 
The Labour Party supports this Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill because it is largely a technical bill although I admit as the previous speaker said that there are some important elements in the bill in terms of the exemptions particularly relating to the idea of people who are studying overseas on exchanges or scholarships. I think this is a good thing. It will allow people to continue their education in a way that New Zealand will benefit from. We will come back in the Committee stage to some of the technical amendments particularly the one relating to the changes to penalties. I understand the Green Party’s position on it and I would like to raise a few questions with the Minister of Revenue about how information will be communicated to borrowers so that they know about the increased penalty rates. That has been one of the major issues for people when they have been going overseas—not always understanding what requirements they have as borrowers. I think it will be very important if we are to take a more punitive stance that our borrowers know what they will be doing. 
Also with regard to the hardship grounds I think that potentially quite a good thing is being done there but we need to understand fully how that will work as well. Another one of the technical amendments is very technical. It is shifting the setting of the interest rate from regulations to the Student Loan Scheme Act. This seems like a minor amendment but there are some questions to be raised about that particularly in light of what happened this year with the setting of the interest rate. We just want to make sure that we are clear on how that will work. These technical matters tidy up some elements of the Act and the working of the scheme and we are pleased to support that. 
But it is difficult for us to stand here and be completely comfortable when it comes to talking about student loans and this Government because what we have heard in recent weeks with the appointment of Steven Joyce as the Minister for Tertiary Education is an absolute acknowledgment that National has never had a commitment to the interest-free student loan scheme. Steven Joyce said in the  
Press  
last Saturday that it was a “political call” to take on the interest-free student loan scheme. Those of us who were around when Labour brought in the interest-free student loan scheme are not surprised to hear that because at the time it was introduced John Key who was then I think the finance spokesperson for the National Party said that he would oppose interest-free student loans with every bone in his body. He said that with every bone in his body he would oppose them. 
Chris Hipkins 
: Can’t have many. 
GRANT ROBERTSON 
: Well there cannot be many bones at all— 
Hon Member 
: Spineless! 
GRANT ROBERTSON 
: —spineless some might say but not many bones at all. He told this very House that he would oppose interest-free student loans with every bone in his body but a political call came along and National adopted it. 
But we know that there is no commitment to the scheme because both Mr Key and Mr Joyce in recent weeks have said that things need to be looked at with regard to the student loan scheme and that there need to be changes. In the Prime Minister’s statement to Parliament Mr Key made it clear that he wanted to tighten up the rules for access to student loans. He talked in particular about people who may not be passing their courses and there was another very worrying phrase about people who were not moving into work quickly enough. We on this side of the House want to know what that means because it sounds like a huge restriction on the ability of people to undertake multiple courses or to perhaps change tack part-way through a course. Not everybody arrives at tertiary study instantly ready and knowing what they want to do for the rest of their lives. We need to invest in education and allow people to develop their skills and any tightening of the student loan scheme any limiting of people’s access to students loans—which is what the Prime Minister was talking about in his statement to Parliament—will be detrimental to New Zealand’s future. The Government really needs to explain where it is heading with student loans. 
Steven Joyce is a man whom I respect. He clearly has a good and quick understanding of how politics works and he has come into Parliament as a senior Minister but he has said some things that I think belie the fact that he understands the student loan scheme properly. He said in the  
Press  
last weekend: “The simple point is if you don’t pay interest on any loan—forget student loans for a second—then there is less incentive to pay it back than if you do pay interest.” The thing that Mr Joyce leaves out is that student loans are automatically deducted from one’s salary once one earns more than $19000 a year at 10 percent. That is the incentive. The law gives the incentive. What appears to be happening is that Steven Joyce in taking on this role is looking to wind back elements of the interest-free student loan scheme before I predict in the future National attempts to wind back the whole scheme. We have heard phrases coming out of the National Government about the generosity of taxpayers. That phrase was used by John Key in his speech to Parliament. Louise Upston used it before. This is the beginning of the Government trying to say that students do not deserve interest-free student loans. 
We know and it is actually implicit in this bill that the purpose of interest-free student loans in large part is to encourage people to stay in New Zealand. That is completely understood by this bill because we are extending the loans to people from other territories from Niue the Cook Islands and Tokelau and to anyone in the Ross Dependency as well. We are acknowledging that interest-free student loans are good in terms of the policy objective of keeping people in New Zealand and encouraging them to stay and contribute to our economy. National rejected that as a reason for interest-free student loans when they were first brought in but this bill recognises that that is an important part of developing our economy and making sure that people stay here and contribute to our economy. That will be undermined if the National Government goes ahead with starting to restrict access to student loans and winding back the interest-free policy which those members have never been committed to. Supporting it was a political call. It was a policy they would oppose with every bone in their body but they were forced into supporting it for electoral reasons. They look to slowly but surely undermine that policy and we on this side of the House will not stand for that. 
We have had some comments from members on the other side of the House about the importance of education and about National’s understanding of the importance of investing in tertiary education. But if we look at National’s record on tertiary education we see that there is no sign of that. Mr Nash has already spoken about the removal of the training incentive allowance. The last Budget took $60 million out of our polytechs at the very time that they were necessary and important in terms of giving people skills during the recession. If we look across the Tasman something that I know that National is very fond of doing we will see that Australia in response to the recession invested in skills and technology; it made sure that people had free access to the equivalent of polytechnics if they lost their jobs. That was a bold move to ensure that people kept up their skills in a recession and were able to contribute to the economy when the recession lessened. 
What we have from National is no investment in the tertiary sector. Where is the plan to say that because tertiary institutions are bursting at the seams which they are we will lift the cap because circumstances dictate that we want people to be training so that they can contribute to the economy? We have seen nothing of that; we have simply seen a consistent undermining of the tertiary sector the taking away of community roles on polytechnic councils and a lack of investment in the future of New Zealand. Although we support this bill because it includes some important technical changes we are very wary of the direction of the National Government on student loans and very wary that it will undermine interest-free student loans a policy that is important to our economy and important to our future. 
JO GOODHEW (National—Rangitata) 
: 
 I rise to speak on the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill and I note that this opportunity has been used for political statements so I intend to make a couple of my own. 
The first thing I want to say having been on the Education and Science Committee that examined this bill is that I am left with no illusions: the student loan scheme is extremely important to New Zealand and it is important that it is working appropriately and managed in an efficient and consistent manner. That is what this bill is all about. It is not about revisiting whether we should have student loans. It is not about trying to scare the horses which we have been listening to members from Opposition benches doing. This bill is about making sure that the student loan scheme works in an efficient and consistent manner. 
At the same time I take this opportunity to say that we need to send the right messages to our students. We need them to understand that the student loan scheme is important to them but also to New Zealand and that its value of $10.3 billion represents a significant asset to the Crown. We need them to be under no illusion that we see them also—the students of New Zealand—as a very very valuable asset and that is why they have the opportunity to take student loans. I am right in the midst of this at the moment with three daughters at university the last of whom headed off to university just a couple of days ago. One delivers one’s children to university and hopes like hang that they use that opportunity and understand the responsibility that they have to make wise decisions for their future. 
Of course the students who are going to university will be making decisions about whether they take out a student loan and whether they have a holiday job and about their future and what courses they will take. Some of them will make the wrong decisions and will revisit those decisions. But they will have in place a student loan scheme that National is committed to having in place and a student loan scheme that is balanced but at the same time puts in place incentives for those young people to pay their loan more quickly. 
One in four New Zealand graduates heads off overseas and that is really regrettable because we want those young people to stay here in this country. It is not just the correct settings on the student loan scheme that will enable that; we have to put a whole lot of settings in place. I note that yesterday there was an announcement by the Government to extend voluntary bonding to my own district health board of South Canterbury. I understand that that is yet another way that we can keep students and medical graduates in New Zealand by putting in place the right incentives. That is exactly what this National Government is doing—looking at all incentives to keep those valuable young people here. Who wants to think of their children being in another country—having a good job perhaps—and having to go and visit them and their grandchildren? This is something that is certainly coming home to roost to me. I really hope that our daughters will find good jobs in New Zealand. 
More than half a million New Zealanders have a student loan. Many have made long-term financial decisions on the basis of the current interest-free student loan policy and we want to assure them that they can plan with certainty. National however was concerned that under Labour there was no incentive for students to repay their loans earlier. That seemed pretty crazy to us. That meant that loanholders were likely to have their debt for longer of course which has implications for other areas of their lives—as well as implications for the Crown—such as when they are buying a house or starting a family. 
National has fulfilled its commitment to keep interest-free student loans for tertiary students. Back in September 2009 we passed legislation that provided for a 10 percent bonus for both New Zealand borrowers and overseas-based borrowers who make voluntary repayments on their student loans of $500 or more in a tax year which gives those students the opportunity to reap the rewards of saving and paying off their student loans earlier. 
This bill introduces mainly technical changes—and I will probably go into more detail about those changes in the Committee stage or third reading. It extends the grace period removes the hardship criteria and allows students who return to New Zealand 6 months of interest-free loan to fulfil our commitment to a balanced scheme that takes into account these more difficult economic times. I make no apology for making my share of political statements in my speech this morning. However we really need to get back to the reason for this bill. It is about managing the student loan Crown asset which is what it is in an efficient and consistent manner and I commend the bill to the House. 
CHRIS HIPKINS (Labour—Rimutaka) 
: 
 It is a slightly strange feeling for me to be standing to speak in favour of a Government bill; it is something we do not get to do very often on this side of the House. It is nice to be able to support one of the initiatives that the Government has in place. The interest-free student loan scheme is one that I am particularly proud of and one that the previous Labour Government is particularly proud of. It is good to see that National has come round to supporting the interest-free student loan scheme albeit probably temporarily. We hope that it continues to support the scheme. We also think that there is actually a compelling case for passing this Student Loan Scheme (Exemptions and Miscellaneous Provisions ) Amendment Bill in a bit of a hurry because of the looming deadlines involved in this legislation unlike some of the other bills that have gone through the House under this current somewhat shambolic urgency session. 
I am pleased that the Minister of Revenue managed to get to the Chamber in time to make his second reading speech— 
Hon Member 
: Just. 
CHRIS HIPKINS 
: —only just—because we nearly missed the opportunity to debate it altogether. I am pleased that he made it here. He probably was not expecting the Government to completely mess up the procedural motions on the previous bill and he would have thought he had a little bit more time to get down here but he had to rush down to the Chamber instead. On behalf of the House I thank him for getting here in time so that we can debate this bill today as part of this urgency motion. 
I mentioned before that I was pleased that the Government seemed to have come around to the idea of interest-free student loans. In fact it seems to have come round to the idea of interest-free loans in general. Interest-free loans for Ministers who use ministerial credit cards appear to be the order of the day at the moment. I understand that the Government is a man down on the other side of the House today. The only real question is whether that member will pay interest on the money he is paying back. As the Government wants to make students who leave the country pay interest on their student loans I ask whether Phil Heatley will have to pay interest on the credit card money that he is paying back. 
I find it ironic that we are here talking about the interest-free student loan scheme at a time when the Government has already announced that it will be relooking at all of the issues relating to student support. The question that is on the minds of all students at the moment is what that means. Does that mean interest-free student loans are for the chop? Does it mean that their allowances are for the chop? Does it mean that the fees will go up? The students do not know because the statements coming from John Key and Steven Joyce are sufficiently vague that students have no idea what is looming round the corner. I am concerned that the Government is starting to soften up the ground in order to do away with interest-free student loans. I am pretty confident that it will not do it in this term of Parliament but I do not have any confidence that it would not do so in the next term of Parliament. 
When we look at the comments John Key made when the interest-free student loan scheme was introduced in the first place it is pretty clear to us that he was fundamentally opposed to the idea. What did he say? He said: “What a cost … What an unaffordable and irresponsible cost to the country!”. That was what John Key said when the policy was first announced. He called it “rushed and reckless”. He said: “Our caucus would never have signed off a zero percent interest rate because the economics are just so bad. It has never for us because we have standards.” 
Well I am not sure that the Government really wants to be talking about standards in education at the moment—not today. I am not sure that Government members will want to talk about standards in many areas today although at least we are having question time today at 2 o’clock—hopefully. I think the Government can expect a few more questions on standards in education during question time today. 
As my colleague Grant Robertson said John Key said that he would fight the interest-free student loan scheme with every bone in his body. 
Grant Robertson 
: We’re still looking for the bones. 
CHRIS HIPKINS 
: We are still looking for the bones because in this Parliament we have a bill that actually extends some of the provisions of the interest-free student loan scheme. They are sensible provisions. They are provisions that the Labour Party has supported and will continue to support such as extending interest-free student loans to borrowers in Niue the Cook Islands Tokelau and the Ross Dependency. The bill also extends interest-free student loans to students who are enrolled with a New Zealand education provider and are engaged in full-time study overseas under either a formal exchange programme approved by the Government or a formal agreement between a New Zealand tertiary provider and an overseas tertiary provider. 
I will flag one issue for the Minister for Revenue and he might like some advance warning that I will raise it during the Committee stage. I understand that although the interest-free student loan scheme will be extended to those studying overseas at the moment it covers diplomats living overseas on a posting but not their partners. Diplomats’ partners who move overseas on a posting are not eligible for an interest-free student loan but the diplomats are. It is possibly an anomaly in the scheme that the Government may want to think about correcting because ultimately the partner is on a posting as part of a Government contingent as well and I am not sure that there should be a distinction whereby diplomats’ partners do not get an interest-free loan when the diplomats do. I have not had time to check that out thoroughly but I am pretty confident that it is currently the case and I think it is something that the Government might like to look at. It seems to me to be quite consistent with the goals of this bill for that matter to be addressed during the Committee stage. We want to make sure that all New Zealanders who meet the criteria for interest-free student loans are able to get them and are not disqualified based on a technicality. 
I come back to the Prime Minister’s statement earlier in the year. John Key said he would “take a careful look at the policy settings around student support”. As I said everybody wants to know what that means and where that leaves the interest-free student loans policy. A lot of students will have heard the things that the National Government has said about interest-free student loans in the past and they will want to know whether they mean that interest is on the way back or whether other changes to the tertiary education system that will leave them worse off are likely. National’s track record on tertiary education is not actually all that flash and its track record on keeping its promises on tertiary education is not all that flash. 
I was not a tertiary education student in the 1990s but I can remember back that far. I remember when Lockwood Smith travelled the length and breadth of the country signing pledges that he would resign if student fees were not abolished altogether. Over the next 9 years that National was in Government student tuition fees increased massively and National introduced the student loan scheme as the way to pay for them. So not only did National weasel out of the promise it made to students but also it then found another way to impose more and more costs on students. That was how the student loan scheme came about. The whole student loan scheme is the result of a broken National Party election promise. 
When people hear National members saying they will not change the interest-free student loan scheme I do not think they will have much confidence in that when they also hear John Key saying things like the Government will take a careful look at the policy settings around student support all of which points to the fact that National is looking at the issue. Last year when Bill English and Anne Tolley were challenged by the Opposition over whether they had asked Treasury to look at the cost of abolishing the interest-free student loan scheme or at the potential revenue they would gain from abolishing the scheme they did not deny that they had done so. To this day National has not denied that it asked Treasury to put together the costings and the projections involved in removing the interest-free student loan scheme. That is something that students up and down the country will be worried about. 
The interest-free student loan scheme as I said at the beginning is a policy that we on this side of the House are very proud of. It allows students to repay their loans much much faster they would have done under the previous regime when interest continued to mount to the point where some students were struggling to even make the interest payments let alone to pay back the principal. Of course under the National Government that existed prior to 1999 students were charged interest even while they were studying. Although they had no ability to earn any income to pay back the loan they were still being charged interest and their loan at the time of graduation was significantly more than they had been required to borrow to pay for their fees or their living costs. There was cumulative interest over the 3 years or 5 years in some cases that they had been studying. Labour thought that was unfair and it was one of the first things the previous Labour Government did away with. 
We are pleased that this National Government has so far kept the interest-free student loans policy. We are worried that National appears to want to take that away and that all the things it is doing are preparing the ground for the reintroduction of interest on student loans and for the imposition of further cost on tertiary students which can act only as a barrier to our lifting the wage rates the productivity and the economic standing of New Zealand. An educated workforce is the way that we increase those things and interest-free student loans are an important part of the policy mechanism by which we encourage people into tertiary study. 
AMY ADAMS (National—Selwyn) 
: 
 I do not intend to take up much of the House’s time on this bill. I want to make a contribution about a point that my colleague Louise Upston touched on which is something I have not heard discussed so far in this debate. I come back to the fact that this bill is a revenue bill; it is in the name of the Minister of Revenue Peter Dunne. I just want to make a contribution wearing my Finance and Expenditure Committee hat I guess even though that committee did not consider this bill. 
One of the issues that the Finance and Expenditure Committee has been very much engaged in is the management of tax debt and I think that in looking at student loans we cannot overlook the fact that they are a $10 billion chunk of the Government’s books. They are a serious and significant part of the Government’s accounts and steps such as those in this bill will help manage that tax debt. We know that that debt is spiralling out of all control and Opposition members agree with us on that. We have to get a handle on tax debt. 
The part of this bill that introduces the ability of the Inland Revenue Department to put up compulsory payments from 10 percent to 15 percent when borrowers have been in default in terms of having the correct deductions made is an important part. It is important for managing our tax debt. The other thing it is important for is legislating consequences for borrowers who fail to live up to their obligations and that is something I fundamentally agree with. If borrowers do not ensure that correct deductions are made there should be a legislative consequence for that action. If that means moving to 15 percent until the indebtedness is cleared and if that encourages borrowers to be more compliant to be more aware and to take more responsibility for their obligations then that can be only a good thing. I commend the bill to the House. Thank you. 
CARMEL SEPULONI (Labour) 
: 
 I am very happy to stand and take a call on the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. I may be one of the few young members of Parliament who currently still have a student loan and are still paying it off. I am nearly there. It has taken me 9 years but I am nearly there. So I do have a heart for our students out there who are taking out student loans with the best intentions: trying to get ahead in this world and trying to do good things for themselves and their families. 
The Labour members are supporting this bill. I will talk first about aspects of the bill that we support. One of those is the fact that the bill extends interest-free student loans to borrowers who are resident in Niue the Cook Islands Tokelau or the Ross Dependency. I think that is a good idea. One of the things that we came across on the Foreign Affairs Defence and Trade Committee trip to Niue last year was the fact that Niue is suffering from depopulation. If we can encourage Niueans to go back and work and contribute to their economy there—and it is the same with the Cook Islands and other countries—then that is a good thing that New Zealand can do. Those countries talk about the fact that their Pacific people are contributing here in New Zealand so I think it is important that we allow them the opportunity to go back and contribute to their countries especially given that we have something like 22000 Niueans in this country and there are only 1000 in their homeland. 
Some of the concerns that have been raised in respect of this bill are about the National Government’s future plans for students loans. This kind of bill makes alarm bells go off in our heads. We are concerned about some of the comments that have been made on student loans recently by both the Prime Minister and the new Minister for Tertiary Education Steven Joyce. The fact is that the Prime Minister has recently said the Government will take a careful look at the policy settings around student support. The concern is that—and we do not trust the Government to take this scheme seriously—National members have talked many times about the number of students who are rorting the system apparently. Apparently we have heard from Government members and from the media students are doing things like taking out student loans then saving the money because it is interest-free. That is very much a small small minority of the students who access student loans. The vast majority are people who need the student loan scheme in order to have the opportunity to take up tertiary study in the same way that those who have money do. 
So it is concerning to hear the National members talk about student loans and changing the policy around them because we do not know how far down the track National will go. Of the something like 13 years that I spent living in Auckland I spent 11 years working at the University of Auckland or studying there. I have worked with a large number of students—Maori Pacific single parents—who rely on the fact that they can access student loans. If there are to be any changes down the track that jeopardise the accessibility of student loans then this country will be in huge trouble. 
Mr Key referred to the fact that some students do not take their study seriously or do not get a job quickly after qualifying. One thing that we need to recognise is that research shows that unfortunately Maori and Pacific students often take longer than other students to complete their degrees. The reason for that is not anything to do with their having lesser intelligence or anything like that; unfortunately what we see is that many of the Maori and Pacific students are still the first person from their family to go on to high-level tertiary education. The culture of the environment at universities is very foreign compared with what they have ever experienced in their lives. When they go into that environment many of them struggle to come to terms with being in it. It is completely strange and foreign compared with what they have ever experienced before. So if the Government does go down the track of putting limitations on student loans it will be those Maori and Pacific students and also—I will talk more about this shortly—solo parents who will suffer more than anyone else because of that. 
One of my colleagues has already talked about the fact that the training incentive allowance was cut. We have been receiving emails since that was announced in the May Budget from women who do not know how they will be able to cope with tertiary-level study with degree-level study if they do not have that tertiary incentive allowance. If we put limitations on student loans that will only further serve to marginalise that group. Those are aspects that we are concerned about. It is important that we alert members on the Government side of the House to those concerns so that when they are looking at the policy and when they are looking at further legislation they will take those considerations seriously. 
The Greens brought up their concern about increasing the amount that students who are in arrears will have taken from their earnings under this legislation. The increase will be from 10c in the dollar to 15c in the dollar. The Greens have raised a valid concern. But as my colleague the Hon Maryan Street referred to before we have to make sure that people are using the correct tax codes and are not trying to rort the system in any way. Again the thing that we need to be cautious about and that the Government needs to watch very carefully is that it is not certain groups that are affected by the introduction of this clause. We know that Maori Pacific people and women will earn less once they get out into the workforce after completing their tertiary studies. If they are solo parents with children to raise then increasing the amount from 10c in the dollar to 15c in the dollar may affect their ability to look after their families. Those are some of the things that the Government will need to watch very carefully. We do not want to push through legislation that may marginalise particular groups. That was one of the Green Party’s valid concerns. 
As I said before the direction that the Government seems to be taking with regard to student loans is concerning. As my colleague Chris Hipkins pointed out earlier the National Government does not have a good track record with regard to tertiary education—it does not have a good track record on tertiary education. Fundamentally underneath all the rhetoric National did not and it does not support access to student loans. As I yelled out before to one of the National Party MPs the chances are that the daughter she spoke of did not have to access a student loan. The chances are that anyone who is working here can afford to pay the fees for his or her child. Not everyone has access to that kind of support so we need to make sure as a country that we support those who do not have access to that type of money to go on to tertiary-level education. That is one of the things that we do not trust this Government to do. We do not trust this Government to make sure that every New Zealander has an equal opportunity to access tertiary education. That issue has come up in the past. National voted against policies that the Labour Government put forward in its 9 years. Those policies and legislation were conducive to ensuring that all New Zealanders have access to tertiary education. As we head into the future we are aware of the fact that if given the opportunity the National Government would make changes that would be detrimental to some of the more marginalised groups in New Zealand. 
I also say the Government needs to take aspects of the student loan scheme seriously. I saw many students come into my office over the years while I was working at the university who had been put back or affected negatively by some of the operational matters of student loans: some of the timeliness issues and things like that. When students have to wait for 6 weeks to receive money in the first semester of the year they are severely put back in terms of their ability to go to classes—sometimes they are actually shut out—and their ability to obtain their course outlines and everything else. That can have a detrimental effect on their success in that first semester or even in that first year. So there are other matters related to the student loan scheme that this Government needs to take very seriously and look at in order to make sure that the scheme works successfully and efficiently for students who need to access student loans. 
We have pointed out that at the end of the day if further changes are made to the student loan scheme and accessibility to it is affected by the Government’s ideology on whether student loans should be interest-free or on how accessible they should be it will be Maori Pacific and I think women students as well who will be most affected by any possible changes that the Government may go down the track of making. We are concerned about that. We have discussed it very broadly amongst our caucus. We are keeping our eye very closely on the situation to ensure that the groups that I have discussed are not affected negatively by the Government’s future policy on tertiary education and the student loan scheme. 
DAVID GARRETT (ACT) 
: 
 The Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill is a good bill but not a great bill and ACT supports it. 
A party vote was called for on the question  
That the amendments recommended by the Education and Science Committee by majority be agreed to. 
Ayes 113 
New Zealand National 58; New Zealand Labour 43; ACT New Zealand 5; Maori Party 5; Progressive 1; United Future 1. 
Noes 9 
Green Party 9. 
Question agreed to. 
A party vote was called for on the question  
That the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill be now read a second time. 
Ayes 113 
New Zealand National 58; New Zealand Labour 43; ACT New Zealand 5; Maori Party 5; Progressive 1; United Future 1. 
Noes 9 
Green Party 9. 
Bill read a second time. 
In Committee 
Part 1  Amendments to principal Act 
Hon MARYAN STREET (Labour) 
: 
 I rise to speak now to the Committee stage of the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill which is where we get down to some of the nuts and bolts around this legislation. But I have to say to begin with that it is very timely the legislation has reappeared on the Order Paper now because between the time this bill was first introduced and referred to the Education and Science Committee and the time when it has come back for its second reading a number of signals have come from the Government about tertiary students and in particular about the loan scheme. Here we have legislation that Labour will support but about which we are unsure there is a long-term prognosis. 
Most recently we have had the Prime Minister’s statement at the beginning of this session of Parliament in 2010 when he referred to the fact that the Government would “take a careful look at the policy settings around student support”. That led me and other Labour members to ask what on earth that meant. What does that mean? Will the Government make student allowances and loans harder to access? In the drive to cut costs is the Government seeing the cost of student loans and student allowances as simply an impost on the Government coffers without recognising the extent of the investment they represent in tertiary education? 
A Government of a different hue particularly if the hue were red might have seen fit in fact to invest more in tertiary education not less in order for New Zealand to escalate out of a recession and in order for us to equip ourselves as a country with the kind of economic growth and development we aspire to and with the kinds of wages and incomes we aspire to. But the only signals we have received from the Government are signals that contradict Part 1 of this bill and those signals are about making things harder for students. 
This bill—and most of the relevant provisions are in Part 1—in fact extends the scope of student loans to others who live in what has been quaintly called for a long time “the realm of New Zealand”. At least it now appears quaint but it is those countries such as Niue Tokelau and the Cook Islands which are constitutionally and in every other way dependent upon New Zealand and which will now be embraced and brought into the scope of the student loans provision that currently exists. 
So here we have a bill that extends the scope of student loans at a time when the Government is saying that it will cut back or look at cutting back on opportunities for people to access tertiary education. Let me just underscore that point for a moment by referring to a statement made recently an article in the paper that appeared recently about the Universal College of Learning the polytechnic centred in Palmerston North with satellite campuses in Wanganui and Masterton. Its chief executive Paul McElroy has been saying he will have to cut back on student admissions in order to meet the Government’s requirements—to cut back on student admissions and entry to the Universal College of Learning. 
That is a tragedy. Just at the moment when we are looking for people to upskill and reskill this Government is putting in place pressures and parameters that will make our tertiary institutions turn students away. The student cap is not something set in stone; it is something negotiated. This Government should lift that cap in order to ensure that we have the kind of skilled workforce that will take us into the future. People in tertiary education whether in a trade or an apprenticeship or at a polytech wananga or university will be the people who will provide the economic development of New Zealand and the future sustainability of that economic development. But that is being shut down by this Government at exactly the time when we are looking at legislation to extend access to tertiary education. 
We in Labour believe in extending that access. We also believe that students should pay back their loans. Loans are not called loans for nothing; they need to be paid back. Therefore there should be some incentives and this bill also provides additional incentives to encourage people not to default on their loans but to do their best to repay them. As a rejoinder a complementary clause in that respect the bill also extends the hardship provisions. This bill extends the hardship provisions so that in the case of students legitimately not being able to repay their loans at the rate that has been determined there is scope for the hardship provisions to be enacted beyond the immediate tax year. That is important. 
So we do not think that the bill is unbalanced in that respect. Yes it raises the cost of defaulting from 10c in the dollar to 15c in the dollar but it does provide additional hardship coverage. That represents an investment but this Government by its signals from the Prime Minister and more recently by the very explicit declaration of the new Minister of Tertiary Education Steven Joyce has shown that it wants to make it harder. The Government wants to make it harder to access skills and education and that is what the problem is here. The problem is that we have a Government talking out of both sides of its mouth and that is problematic. It will be problematic in the long term and it will be problematic in the short term for institutions that are under extraordinary pressure at the moment and that are in the situation like that of the Universal College of Learning of turning students away. 
That is not what should be happening in the escalation out of a recession. It is short-sighted of this Government and it will cost us dearly in the future. There are some things that a Government must invest in. Other Governments are doing so. Australia the United States and the UK are investing heavily in tertiary education. This Government is going in the opposite direction at 100 miles an hour and that is wrong; it is not appropriate. Although Labour supports this bill and the provisions in Part 1 we need to set this in context. A dangerous collision is about to happen in the Government’s tertiary education policy—a dangerous collision. We have people aspiring to upskill and to improve themselves. 
This is not just about going to university. This is about accessing tertiary education opportunities across the gamut. We have seen what the Government has done with adult and community education which is low-cost accessible education in the community. The Government has axed it. It has disappeared off the face of parts of our country and it limps on in a skeletal form in other parts. That is a disservice to the skills development that needs to occur in this country. This bill which Labour supports goes in a different direction. 
GARETH HUGHES (Green) 
: 
 Kia ora Mr Chair. He mihi nui ki a koutou kia ora. To answer Carmel Sepuloni’s question I am one who has a student loan and was a student last year and I am excited about the opportunity to participate in this debate. I will talk a little about the reasons why the Green Party is opposed to this bill. I first started studying in 2000 towards a Bachelor of Arts degree at Victoria University and of course because my parents are not wealthy I had to take out a student loan. Ever since then every couple of months I receive a new letter in the mail from the Inland Revenue Department saying how big my student loan is and it is so discouraging to have to look at that $30000 figure. Like many people of my generation I want to buy a house I want to start setting up a superannuation fund and I want to put money aside for my son’s education so that he does not have to take out a student loan and this letter is one of the most discouraging ones I ever receive in the mail. 
Ever since the student loan scheme was introduced students in New Zealand essentially have been paying an education tax. Every fortnight 10 percent of my gross pay is deducted straight away and paid towards my student loan repayments. What we are talking about in this bill is for some like a tax increase. I congratulate the decision made in 2005 to reduce the interest payable on student loans. When I first started studying in 2000 I had to pay interest on my loan while I was studying. I thought this was ridiculous. I think we need to listen to the students associations on this issue the other people who can talk for students who call this bill unmanageable and unaffordable. The student loan scheme is a public good. We cannot be looking at it as though it is just a cost to the economy. This scheme is a public good. If we are to increase our GDP if we are to race Australia in wage increases we need to make education more accessible. We need more people developing skills if we are to live in a sustainable and innovative economy. 
This bill makes some changes to the student loan scheme. Some are good some are all right and some are bad. I turn first to the good changes. The bill extends interest-free loans to borrowers in Niue the Cook Islands Tokelau and the Ross Dependency and to students enrolled with a New Zealand education provider or engaged in full-time study overseas under a formal exchange programme. This is a good move. It extends the interest-free student loan provision which was such a benefit to me to other students. This provision supports our Pacific neighbours and builds stronger relationships. I turn to the changes that are all right. This bill replaces the interest rate where applicable and sets it by formula. The proposed formula is identical to the formula currently in use. The change is to take it out of regulation and put it into the principal Act. We are fine with this provision. 
Then there are the bad changes. This bill enables the Commissioner of Inland Revenue to increase the standard rate for deductions from salaries and wages from 10 percent to 15 percent. For borrowers who have failed to have the correct deductions made the increased deductions will apply until any under-deductions including late repayment penalties have been fully repaid. Compulsory student loan repayments already kick in at a very low threshold. Increasing the deduction to 15c in the dollar will have a severe impact on some borrowers their families and their children. The current threshold is set at $19084 gross. I ask whether any members in this House could survive on seeing 15 percent of their gross income going straight back to the Inland Revenue Department on top of GST increases rent food and other costs. For some this is another tax increase that they will be seeing this year. An amount of $19084 is very hard to live on. I ask whether any members could live on that amount. 
What do we need to do with this bill? The Green Party believes that the student loan scheme is already a heavy burden on many students on low incomes and on students who do not have high-paying jobs after they leave tertiary education. We oppose all initiatives that increase that burden. Despite the useful technical amendments—and we support the idea that students in the Cook Islands Tokelau and others should have the benefit of interest-free student loans—we will not be supporting this bill. 
The CHAIRPERSON (Lindsay Tisch) 
: Before I call the next speaker I say to the member that when he goes for the call he must remain standing. If he were to sit down he would forfeit his right to speak. I knew the member was going for the call so I was happy to give it to the member. I say well done. 
Hon DAVID CUNLIFFE (Labour—New Lynn) 
: 
 Firstly I acknowledge the member who has just resumed his seat Gareth Hughes. We enjoyed his maiden speech and it is good to see him participating in this debate as a student loan holder. I had a student loan too but it was in the bad old days when we had to get our loans from a bank rather than from the Government. Yes it did look discouraging for a pretty good while. 
Labour supports the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill and I might say I still do not understand why the Greens do not. Much of it is about extending the coverage of the student loan provisions and that has to be good. In particular we support the extension to students living in Realm of New Zealand countries because they deserve the same constitutional privileges in this regard as people living within the standard New Zealand territorial boundary. 
I will begin by taking a step back and positioning this bill within the general ethos of the Labour Party’s approach to the question of tertiary study. It is fundamental to us—and it will always I believe be fundamental to us—that all citizens have the same if you like ethical value and moral worth and they all deserve the same opportunities to thrive and to make the very best of themselves in life. That is why we are for the many not the few. We think that if opportunities are spread equally not only do we improve the welfare of our community and strengthen our economy because equal societies perform better economically but we provide social mobility. We provide the opportunity for the son or daughter of—I used to study in Wales—a miner to aspire to all the same opportunities as the son or daughter of a doctor does. 
That approach is something that many members in this House have benefited from. Even some members opposite make a big deal of growing up in a State house or benefiting from the State education. What angers us is when we believe that members opposite are pulling up the ladder after themselves. Those kids who went to the State school or benefited from the State house have an extra obligation to make sure that today’s generation has the same opportunities that they had. 
That is why we are always a little suspicious when there is I have to say some ambiguity. The ambiguity is not so much in the bill as in the statements that various Ministers and members opposite have made. The Prime Minister for example said that he wants to take a careful look at the policy settings around student support. Well we wonder what that actually means. The policy is pretty clear: a student can take out an interest-free student loan and approximately 75 percent of the costs of a student’s tertiary study in New Zealand is covered by the State. That is so we do not create worse barriers to all young New Zealand people having access to education. 
As the Opposition spokesperson on finance I am well aware that that could not be more important than during a recession. Large large numbers of young people are unemployed. Over 45000 15 to 19-year-olds—12000 more than at the same time a year ago—are unemployed. That number increases to over 72000 young New Zealanders if we include the 20 to 24 age group. As my colleague and friend Carmel Sepuloni noted Maori and Pasifika students and I would add students from migrant backgrounds are overrepresented in those statistics because in a recession it is last on first off. In my electorate of New Lynn which I am passionate about 13.5 percent of my constituents are Pasifika 9 percent are Maori and wait for it 23 percent are of Asian origin many of them brand new. By the way the average income of the Asian population in my electorate is lower than that of either the Pasifika or the Maori because they are the most recent arrivals and are struggling to make their way in the job market. It is absolutely essential if we are to walk the talk about being a proud independent egalitarian country that stands up for decency fairness and the Kiwi way that we have an education system that is open to all. 
Members opposite often talk about freedom. Well freedom is not just the absence of regulation folks. Freedom and personal responsibility can be real only if we are free to do something because we are empowered and resourced to do it. There is an old philosophical debate about the question “Am I free to dine at the Ritz?”. Well there is no law against it but guys if we cannot pay the bill we cannot eat there. You are free to dine at the Ritz and you are free to get a tertiary education—not you Mr Chairperson; I am sure you had a fine education—one is free to get a tertiary education only if one can get a student loan to meet the costs of attendance and if one is not charged exorbitant fees for the privilege of doing so. Labour is now will be tomorrow and will always be 100 percent supportive of a strong tertiary education system with universal access to it. 
I commend a couple of things in this bill. I have mentioned the extraterritorial extension. Also I echo my Green colleague in saying that as a former Associate Minister of Revenue I support the idea of moving the formula into the primary legislation and not leaving it in regulations. First the formula is too important and second I think moving it settles any argument about whether the regulation should be amended. It takes pressure off the Minister when it is Parliament’s voice that has set the formula. That reflects the importance that Parliament should accord to a good student loan scheme. 
As I have said the inbuilt irony—and I do not want to be unfair to members opposite—is that we keep getting mixed signals from National members about whether their hearts are really in it with regard to the student loan scheme. Steven Joyce admitted that endorsing it in 2008 was only a political call. Well it seems that for that Minister everything is only a political call. What would he support even if the focus groups told him not to? What is so sacrosanct to Mr Joyce that it is beyond polling? I do not know what it is—and he has been in this Chamber for 15 months. 
By the way I say to Mr Joyce—if he is listening—that a single millimetre of broadband in the ground would be a really good idea. There was about $300 million worth ready to go 15 months ago when he cancelled the Broadband Investment Fund. That of course is very important to students because they are high users of broadband. I slip that in there as they say—surgically insert that broadband point. It would be a diversion to go on about the parlous state of the telecommunications industry at the moment so I will stop there. I am sure Mr Joyce is having a very busy day—apparently not as busy as the Prime Minister’s however. He will be very concerned about the conduct of the House and the shambolic nature of the Government’s business. What an interesting week it has been for the Government has it not? It throws the House into urgency for such matters of colossal importance as this bill. Worthy though it is and supporting it as we are why are we debating it in urgency in the dead of the morning? Why are we doing it in urgency? Why could it not be accorded a normal legislative process? Is the Government’s management of the House so terrible that it has— 
Catherine Delahunty 
: Yes. 
Hon DAVID CUNLIFFE 
: Yes I believe it is. I think we have seen that demonstrated. I take the opportunity to commend our whips—Mr Mallard and Mr Hughes—and Mr Hipkins who has been supporting them. I think we have seen a pretty good example of constructive use by the Opposition of House procedure to assist the smooth functioning of the House. Of course we are very grateful for your role Mr Chairperson and that of the Assistant Speakers and the role of the Office of the Clerk in assisting the Government to get through its morning. 
I come back to the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. It is definitely worthy of support. Labour will support it because we are not about petty politics. We are about doing what is right for New Zealand and we are happy as an Opposition to see the Government doing things that we agree with. We are not here just to oppose carp and whine; we are here to do what is right for New Zealanders. The difference between the two sides of the House is that we are about the many not the few. Too often we see members opposite doing what is in the interest of the few not the many. Today we stand behind this small bill which further strengthens and broadens access to education for all New Zealanders. 
CATHERINE DELAHUNTY (Green) 
: 
 Tena koe Mr Chairperson. I was on the Education and Science Committee that examined the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill and I found it a positive experience. Green members have a positive view of the bill even though we are opposing it. We are not carping and whining as much as asserting the value of a student loan scheme that does not punish people who are already in trouble. That is why we are voting against the bill. 
There were only five submitters to the committee and only two of them made oral presentations. They all made valid points. Everyone was supportive of the extension of interest-free loans to borrowers from the Pacific and the Ross Dependency etc. In relation to those students undertaking full-time overseas study under a New Zealand Government - approved formal exchange programme there was some debate over the detail of that second proposal. 
The New Zealand University Students Association made some really important points when it appeared before us. As the body representing a large number of students its voice is regarded by us as being particularly pertinent to any bill that amends the student loan scheme. Many of us have theoretical or parental interest in how the scheme works but the New Zealand University Students Association is working on the front line of the effects on students of this credit and debt system. The association supported much of the bill including the technical amendment allowing borrowers returning to Aotearoa New Zealand who wished to repay their loans before meeting the 183-day requirement for an interest-free student loan to be able to do so. It strongly supported that amendment. However it strongly opposed the Commissioner of Inland Revenue being able to raise the compulsory repayment deduction from the salary and wages of borrowers to 15c in the dollar when payments were overdue. 
Green members were at least part of stopping the Inland Revenue Department from putting penalties on students whom the department itself had failed to notify of overdue debt. As the association pointed out this is the worse possible time with unemployment and especially youth unemployment increasing and the increasing cost of living to add extra penalties to people who are indebted. I know that some members of the select committee will never agree with me but some very poor people are not lazy and unmotivated. They just do not have enough money to cover all their costs. We have encouraged poorer people to see education as the solution to poverty and to go and get that education. We have made them pay for that education and now we are punishing those who are not able to keep up repayments. At the end of their studies there is absolutely no guarantee for many people including women migrants and refugees and tangata whenua and Pasifika people—let alone students with disabilities who are the most discriminated against group of people in this entire country in terms of employment opportunity—to get a well-paying job that will help them keep up with the level of debt and to have a consistent earning record that will allow them to keep up with their payments and not get overdue. 
Some of the discussion in the select committee expressed a highly punitive approach to the problem of unpaid student debt which is similar to comments I hear in this Chamber and elsewhere about beneficiaries. There are the good and the motivated but then there are the bad and the disorganised and the latter must be made to pay. This kind of thinking is a result of the scheme itself. It has not only created inequity but it has exposed inequity. Some of us were able to contribute to some part of our children’s educational costs and some of us were not but a loan is a loan and it must be repaid. All of this is inevitably unfair when the core of universality is abandoned in favour of market forces and the bloodless coup of the 1980s is still framing our education system and its debates our accident compensation our health debates and our economy as a whole. 
There is always one question to be asked of each bill before the House: who really benefits? In terms of this bill the Inland Revenue Department will benefit. But who really cares about the social chaos that ripples outwards for every increase in student debt repayment rates? On that basis we oppose this bill. 
CARMEL SEPULONI (Labour) 
: 
 I will touch on something that Gareth Hughes said in respect of commending the Labour Government for taking interest off student loans in 2005. I have to say as someone who had a student loan that prior to that happening I did not see my loan go down very much; I need to mention that. 
David Garrett 
: Did you graduate? 
CARMEL SEPULONI 
: Yes I tell Mr Garrett that I graduated. I will do something along the lines of what Maryan Street was doing and just look at aspects of this bill in relation to the public comments that have been made recently on the student loan scheme and the National Party’s history with respect to the tertiary education system in general. But I will do my best to stick to the bill. 
We have discussed Labour’s support for the aspect of this bill that will mean that those from territories of New Zealand—Niue the Cook Islands Tokelau and the Ross Dependency—will be able to have interest-free student loans. One thing has just come up in discussions with colleagues. I guess this question is directed to the Minister in the chair the Minister of Revenue; it would be nice if he were listening to my question. We support these students getting interest-free loans when they return to their homeland whether it be Niue the Cook Islands Tokelau or the Ross Dependency. My question is whether the Government has taken into consideration any additional measures or mechanisms that may need to be put in place to ensure that those students who return to the Cook Islands Niue Tokelau or the Ross Dependency—I do not know who lives there—actually have some sort of mechanism for paying back their student loans. That is one thing we do not see in the existing bill at this stage; I have asked my colleagues who were on the select committee and they are unsure about that one too. So we would like a response from the Minister with regard to that question. 
We totally recognise that it is important that those who wish to return to the territories of New Zealand have the opportunity to do so in order that they can contribute to their people and to their communities but we need to make sure that some measures are in place because if they go there for a lifetime and they have left this country with a $40000 student loan then we would like to see that it be paid back. 
That is one aspect that we have covered. I will just talk about that aspect too in relation to what we have seen recently with public comments on the student loan scheme. This bill is basically saying that we support our students from the territories of New Zealand and that we provide them with the same opportunities and provisions with regard to interest-free loans that those who live in New Zealand get. But I am concerned about the public comments that allude to the fact that this Government may go down the track of making student loans less accessible which will unfortunately affect those who are marginalised or under-represented in our tertiary education system as it stands. 
The reason I am raising it is that on the one hand it looks like we are supporting Pacific students from territories of New Zealand to be able to go back to their countries and contribute there but on the other hand it looks like this National Government is at the same time going down the track of limiting the opportunities for students who need to access student loans so that they can do that. That is a very valid concern and I am sure that even though we are in the Committee stage in discussing the bill public comments that have been made recently on the student loan scheme also need to be taken into consideration as in some ways it feels like there is a sense of contradiction in respect of what this bill is saying and what is being said publicly. 
When we look through Part 1 we see that another aspect of this bill is that late payment penalties will be put in place for those who are not using the correct tax codes and for those who may be perceived to be trying to rort the system in some way in respect of actually paying off their student loans when they get into employment. We support that aspect. 
KELVIN DAVIS (Labour) 
: 
 It is great to have an opportunity to speak to the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. In particular I make note of the part that extends our responsibilities to our relations from Niue Tokelau and the Cook Islands. I think that as a country we need to realise that we are not just an isolated island in the Pacific; we have responsibilities to other countries that depend on us. 
We also have a responsibility to Maori to make sure that Maori have full access to tertiary education so it was with some concern that we heard that the Minister for Tertiary Education Steven Joyce had his eye on student loans. We are not quite sure what that means. A lot of research describes how we need to make tertiary education more accessible for Maori and the Starpath research conducted out of Auckland University is something that we need to follow. We need to make it a lot easier for Maori to get into tertiary education—not just Maori but also our Pacific Island relations—instead of making it harder. 
I think it is really important that we realise that student loans are loans not gifts and that people who take out loans have to repay them. It is good to see in the bill that the Commissioner of Inland Revenue is able to increase the standard rate for repayment deductions from salary and wages from 10c in the dollar to 15c for borrowers who have failed to have the correct deductions made or to pay any other amount when it was due. The increased deductions will apply until any shortfall including any late payment penalties has been fully repaid. It is really important that we understand that that provision is in the bill. 
The Prime Minister has made the statement that he thinks that some students do not take their study seriously so they tend to drop out fail or not complete studies in the time they should. But many people do not know exactly what they will do when they finish university; they take different courses. My brother for example started his tertiary training doing a degree in business studies. Part-way through the first year he realised that it was not for him so he moved on and swapped to a Bachelor of Arts in Maori. That again was not enough for him. He ended up studying to become a lawyer and he is now a very successful lawyer. I was one of those people who went to teachers college and did not have to take out a loan. I went to teachers college after the system was in place that paid people to train to become teachers. I was in the middle of my training before the student loan system came about so I do not actually understand what it is like to have to repay a loan for study. I know that some people have loans that are bigger than many mortgages— 
Chris Hipkins 
: Bigger than  
Ben-Hur 
. 
KELVIN DAVIS 
: —bigger than  
Ben-Hur 
 as my colleague Chris Hipkins says. That is one of the factors that make it difficult for Maori to study at a tertiary level. The whole financial situation makes it really difficult. I am talking about a lot of friends and family up north; we struggle to get them to succeed at school in the first place. Then when they do succeed at school they find the financial barriers to move into university are too great for them and they do not go on to tertiary study in the first place. So the potential of the Minister to remove the interest-free element of the student loans would have a detrimental impact on the number of Maori who want to go into tertiary education. 
I was seriously concerned with the comment earlier on from the Hon Maurice Williamson that a bit of slash-and-burn never hurt anybody. The distance that some people on the opposite side of the Chamber have from folk on the ground who do struggle in these situations really concerns me. It is almost like saying that a bit of poverty never hurt anyone. 
JO GOODHEW (National—Rangitata) 
: 
 I move  
That the question be now put 
. 
MOANA MACKEY (Labour) 
: 
 I am very pleased to take a call on the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. I wanted in particular to ask the Minister in the chair the Minister of Revenue a question about the grace period clause in this bill which is clause 24. This seemingly small and innocuous clause is actually incredibly important. At the moment when student loan borrowers are advised of their outstanding loan balance if they repay that amount within 15 days then the interest over that period is cancelled. This bill extends that grace period out to 30 days. My question to the Minister is: how did that 30-day period came about? I know it is a nice round figure; it is a month. I would like to know what went into deciding that a 30-day period would fix this problem. It can be difficult for ex-students who are overseas to make repayments. I have had people contact me who find it extremely difficult sometimes to get their payment in particularly when they are in a country where they cannot wire money easily. I had a friend who was working in Africa who found it incredibly difficult to work out how to get the money back within the time frame. I am not sure that even 30 days would have been enough for my friend to qualify for this grace period. 
This is an issue that I would like the Minister’s response on. Even though it does not seem like an important issue sometimes it can be the difference between people deciding whether or not to come home. If they cannot send money easily if it is too hard and they will not be able to qualify to have their interest cancelled then that may be the point at which they say that they have all this interest piled up but it has been made a whole lot worse so they will just stay overseas and never come back to New Zealand. Then we would never have the loan paid off but more important we would not get value from the tertiary education that the New Zealand taxpayer has paid for alongside the person as well when he or she studied in New Zealand. I would appreciate the Minister’s comments on that. 
I will also briefly comment on extending this provision to New Zealand territories which I think is important. During the work that I have done with the Commonwealth Parliamentary Association I met someone from the Cook Islands who in October last year said to me how desperate they were for this provision to come in. I think we have always been good global citizens. We do not want to pull people away from their homes particularly when their own economic development is so reliant on their best and brightest being able to return home and not having a financial disincentive to doing that. 
I commend the contribution from the new member Gareth Hughes. It was nice to see him getting up on his pins so early in his parliamentary career. I know this has become a bit of a time for telling old war stories and one-upmanship but my colleague Grant Robertson and I went through university at the absolute worst time to go through which was in the 1990s. Mr Hughes and Carmel Sepuloni went through in 2000 which I understand was bad enough. I know how important the incentives are in this legislation for paying back a student loan. A lot of people who jump to their feet have never had a student loan and do not really understand what it is like to have one. They do not understand what it is like for students to feel when they graduate that they will die with this loan because it just gets bigger despite the fact that they are making repayments. The push to leave the country is then very very high. In my case I graduated as a scientist and scientists do not earn a lot of money in this country. Therefore I did not earn a lot of money and I had a loan that was growing day by day with compounding interest. 
That is why this legislation is so important. It is important for our Pacific colleagues and the people in the Ross Dependency which again is very useful for scientists. We do some fantastic climate change work down in the Ross Dependency. This may mean that ACT will vote against this legislation now but it is important that those students are also included in this bill and I am very pleased to support it. But I would appreciate an answer to my question on the grace period so we can be sure that it was arrived at by research and considered thought rather than just being picked because it was a month. 
I will also comment on the hardship clause and commend the Minister for this. I have had people come into my office to say that they have found the current hardship relief clauses which were unintended consequences of the previous changes to the Act very difficult to deal with and inflexible in dealing with their own particular hardship situation. This has become a far more difficult issue in the recession. I would be interested in the Minister’s comments as well around what else will be going on in this area. When people have to pay an extra 10 percent of their income towards a student loan that is a lot of money. 
Hon PETER DUNNE (Minister of Revenue) 
: 
 I take the call at this point because there have been some 10 speeches in this debate so far on the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. I think I have been asked three specific questions and there is one from the second reading that I also want to respond to. 
Before I do so it is perhaps important to place this debate in a wider context. A lot has been said about what may or may not happen with regard to the rules for eligibility and the way in which people might take out student loans in the future. The responsibility for this legislation and my responsibility as the Minister of Revenue rests with the administration of the student loan scheme whatever shape or form that might be in. As part of that portfolio I have to be mindful of a couple of facts. We have a student loan outstanding debt liability—call it what you like—of around $10 billion. We have somewhere in the order of 540000 student loan borrowers with outstanding balances. We have about 40000 student loan borrowers offshore and when we sought to identify them and get their up-to-date details a couple of years ago we managed to get just under half of those people back into contact with us. The point is that we have this massive debt which speakers on both sides have acknowledged that we need to manage. So these changes—and some other changes that were contained in a discussion document released late last year which will be the subject of legislation later this year—are about making it easier for people to meet what we all regard as their repayment obligations. 
It is against that backdrop that I will comment on the questions that have been raised so far. Carmel Sepuloni raised the question about the repayment mechanism for students in what we quaintly term the realm countries. Before I answer that I will comment on Moana Mackey’s point. I think she is absolutely right when she talks about the benefit for students in those countries of access to the student loan scheme. One of the drivers for me in being keen to promote that was a visit to the Cook Islands a couple of years ago. I talked to senior school students about their aspirations for their futures and about the practical difficulties they would face not in getting access to New Zealand universities but in funding their study when they came here. So that was a very important move. Carmel Sepuloni asked what will happen though once they complete their studies and return to their country of origin—hopefully to make that economic and social contribution that this is all about. I draw her attention to the provisions of the bill which I do not have right in front of me; it is a very long clause number. Students will be required to determine their income level and advise the Inland Revenue Department of that and then the process for getting their repayments on an annual basis will be put in place. This is a point I will return to in response to some of the other questions. 
I also make the comment that the changes we are contemplating at the moment will make it much easier for those students as well in terms of moving to an electronic base for repayment so that the system in time becomes more like the way in which we conduct our banking operations. Students will be able to access their balances and make their repayments as their circumstances fit. That will apply to all students but it will be particularly beneficial to students in the realm countries. 
Let me come to the question of the grace period. I have to say that there was no particular science to the choice of the 30-day period. 
We did think that because the major beneficiaries of this change will be students who are overseas 15 days was probably a little tight in the circumstances. But with today’s technologies and communications even using the member’s example of the deepest parts of Africa or somewhere we thought that 30 days was not an unreasonable choice. Once we bring in the next leg of this legislation which is in terms of the electronic basis for the system I think that that operation will become quite manageable but obviously all of these things will be kept under constant review. 
During the second reading debate Chris Hipkins raised the question of the partners of diplomats and whether they would be eligible for the extended provisions. That is a much more complicated question than first appears the case. We do not have within the student loans legislation a particular provision with regard to that category of person. What we do have is a requirement that a borrower or the partner of a borrower is also eligible if he or she is resident for tax purposes in New Zealand during that period. The particular problem that arises for all people who are offshore is the definition of “tax resident”. In respect of the specific question of the status of diplomats and their partners this matter has been considered by the Ministry of Foreign Affairs and Trade the Inland Revenue Department and the Ministry of Education. The conclusion that was reached was that this was an issue that was beyond the specific ambit of the student loans legislation to address but I guess that it is a matter that will be between those agencies and again kept under some form of review. If issues need to be addressed they will be picked up at that point. 
I conclude simply by going back to where I started and by pointing out to the House that what we are doing here is making a much more effective management process for a very large investment by the New Zealand taxpayer—$10 billion. The vagaries of Government accounting systems mean that that $10 billion is actually shown as an asset on the Crown’s books so it is incumbent upon the Crown to do what it can: first to recover that funding; and second to make it easier for those who are making repayments to do so. This legislation and the legislation I am foreshadowing later in the year will be all about achieving that objective. 
CHRIS HIPKINS (Labour—Rimutaka) 
: 
 I will briefly respond to the comments the Minister made regarding the partners of diplomats. I thank him for that explanation and I appreciate that it is obviously an issue that is far more complicated than something that can be dealt with in this bill. I hope it is an issue that will not fall through the cracks. Partners of diplomats are leaving New Zealand for the good of New Zealand to be part of representing New Zealand overseas and it seems very unfair that the person whom they live with could be eligible for an interest-free loan but they themselves might not be eligible for an interest-free loan. I hope that that in time is something that will be able to be addressed more fully. 
I pick up on a comment the Minister made about the size of the asset that is the student loan scheme. I agree it is a significant amount of money on the Government’s books but we also need to consider it in the wider context of the value of tertiary education as I am sure the Minister himself does. It is an investment in the people of New Zealand and in building up the skills of our workforce. If we want to have a much more productive economy one in which we all enjoy a higher standard of living then encouraging people to move into all forms of tertiary education whether it be universities polytechnics or even workplace training is something we want to encourage. I hope that whenever we talk about the student loan scheme we will consider it within that context. 
I want to talk about one or two of the technical amendments in the bill and in particular the increased deduction rate that is covered in clauses 6 and 7. In effect these changes will allow the amount deducted from a borrower’s salary and wages to be increased from 10c in the dollar up to 15c in the dollar. The amendment is aimed at borrowers who have failed to have the correct deductions made and have other overdue amounts. This is a change we support but I want to talk a little bit about the way in which the threshold at which somebody has to make those deductions is established. 
Every year up until last year the threshold at which somebody has to make deductions from their salary has been increased in line with I think the rate of inflation—it might be the consumer price index; I am not sure exactly what the mechanism is. But it has been adjusted each year so that that threshold remains the same in real terms and that was not done in 2010 and 2011. In the statement the Minister put out just before Christmas—I called him a Grinch at the time and I apologise to him for doing so; I think he is a very unlikely Grinch. [ 
Interruption 
] No he was Santa’s little helper I think in the photographs in the paper. 
In the statement he put out at the time he said that the decision to hold the student loan repayment threshold at the current level for the coming year takes into account the current economic climate and the very significant costs of this $9.6 billion asset to the Crown. I think we need to be clear that although we are talking about a fairly small amount of money the principle behind it is I think is a really important one in that we are asking the borrowers of student loans to shoulder an extra share of the effects of the tougher economic climate. 
The other point the Minister made in his statement is that although the impact on individual borrowers is likely to be minimal the effect of maintaining the current repayment threshold is expected to lower the overall costs of the scheme to the Crown. I think we need to be really transparent about that. If the Government is setting out to lower the cost of the interest-free student loan scheme then it should be really upfront—I know that the Minister was upfront in his statement but it is not something that many people have picked up on—because that will have an impact particularly for those who are just near the threshold for making repayments. It is more significant for them than for somebody who is earning a significant amount of money. 
Although we are talking about a fairly marginal amount of money it will be more significant for someone on a very low income right down there at that threshold level than for someone earning a higher income. We need to be really clear and upfront about that and I would certainly encourage the Government in future years to continue making those adjustments to the threshold and not to let this be seen as a precedent for future years. 
I can accept that it was probably a one-off for last year but we would like to see that issue addressed in future years. I hope that when it is addressed this year there will be some retrospective nature of that to catch up with the fact that that threshold was not adjusted last year. 
I turn now to the interest-free loans for borrowers returning to New Zealand. I refer to clause 16 which inserts new section 38AM. 
GRANT ROBERTSON (Labour—Wellington Central) 
: 
 I will pick up on the questions around the increased deduction rate as well and I also have another question for Mr Dunne in that regard. We have heard from the Green Party already in this debate about its concern over the notion that the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill and clauses 6 and 7 in particular will allow the amount deducted from a borrower’s salary and wages to be increased from 10c to 15c in the dollar if the borrower fails to make deductions or has an overdue amount. Those on the Labour side of the Chamber can understand the motivation. New Zealand has an interest-free loan scheme it is a good scheme it is allowing people to pay their loans back a lot quicker than they previously have and it is a scheme driven by the motivation of having people stay in New Zealand. We are extending that in this bill to other countries in the Realm of New Zealand and that is good so that people will contribute to the New Zealand economy. The bill has two purposes and we understand that those purposes are important. The change in it in fact backs up the notion that it is important to stay in New Zealand and that we will create those incentives to do that. 
I note that clauses 6 and 7 will give the Commissioner of Inland Revenue the right to make judgment calls and that is what my colleague Mr Hipkins was speaking about before. Those judgments will be very important and significant calls for some people. I have had a particular case in my electorate office this year of a couple who went to the UK and did not make repayments while they were away overseas. They came back to New Zealand and for a variety of reasons had some issues with making further repayments. In some senses this change would offer them a path for how repayment could be made so in fact there is a positive to this. But my question for the Minister in the chair the Minister of Revenue is around how this change will be promoted. One of the big issues we have had with this scheme is people simply being unaware of what was required of them particularly when they went overseas. A number of people would ring up electorate offices and when I worked for the New Zealand University Students Association many years ago they would ring up; they were simply unaware of what the requirement was when they were overseas. Initially the scheme required people to pay back $1000 a year or one-fifteenth of their income while they were away overseas and people had difficulty making those kinds of adjustments and arrangements to their affairs. 
My question for the Minister really is having understood the logic of giving the Commissioner of Inland Revenue the right to make these increases in the deduction rate what will be done to ensure that people are aware of that that they understand what their obligations are and that they understand perhaps something of the criteria for how the commissioner will make those judgments? I think it is very important because already we see that there is an ability to reduce the payment if it will cause serious financial hardship and that is good. That is an important caveat to put on this but we do not want ourselves in a situation where we have a large number of people going overseas unaware that they could face increases in the deduction rate if they do not meet their obligations at the other end of the scheme. I look forward to the Minister taking a call on that and giving us some further information. 
Another of the technical amendments that I want to draw some attention to is the hardship relief provided for in clauses 19 20 21 and 22. This is something where the Government deserves to be congratulated. We have seen a number of situations in which people find it very difficult and ironically regarding the same couple who came to see me this could have been a legitimate area where they could benefit because the issues and problems they had with their income were not happening in the immediate year when they were seeking relief. The hardship relief clauses are an important amendment to the scheme because we should not fool ourselves that the student loans scheme is a complete panacea when it comes to supporting students through their study. The student loans scheme puts a very serious obligation on those people who borrow from it. They have to pay back the loan from their salary at 10c in every dollar and if they do not meet their repayments after this bill is passed it will be up to 15c in the dollar for some people. 
That repayment is a serious obligation and it brings me back to a comment I made in the second reading when Steven Joyce said that the Government would be looking at different aspects of the scheme and that it needs to tighten up some of the rules. He made the comment that this loan was unlike others because it did not have an incentive to pay it back. Well the incentive is the 10c in the dollar. The hardship provisions in this bill which effectively loosen those hardship provisions are a very important response to the fact that 10c in every dollar over $19000 earned has to be paid back. I think $19000 is a very small amount of money to be earning before paying back the loan so the hardship provisions provide an ability to make the student loans scheme a lot fairer. As I said the Government deserves to be congratulated because it has brought this up but we need to ensure we do not underestimate the importance of some people having access to those hardship provisions because for people earning $19000 it will be difficult to make repayments. 
STUART NASH (Labour) 
: 
 Mr Chair I hope the reason you have given me the call last out of the Labour members who were seeking it is not that the Hawke’s Bay Magpies have beaten the Southland Stags the last two times they played. But I would not make any such assertions and I do not propose to. 
I have a question for the Minister of Revenue. He mentioned that the estimate of student loans on the book is about $10 billion. It would be interesting to know whether there is any qualitative or even quantitative research on the opportunity costs to society of not introducing interest-free student loans or student loans at all. I suspect that the value to our society our communities and our economy is a lot higher than $10 billion. I am not suggesting that the Minister said it was not but it would be interesting to know whether there is any study around that value. 
I will talk about a couple of the clauses in the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. Clauses 10(2) to 10(5) 13 and 25(2) cover interest-free student loans for residents from realm countries. This bill introduces an exemption for borrowers in realm countries from the requirement that they be present in New Zealand in order to qualify for an interest-free loan. The Minister talked about this exemption a little earlier but I think we glossed over it a little. The reason I think this exemption is so great and aspirational is that potential students do not have to make a commitment to first of all come to New Zealand before they can qualify for a student loan. It is one of the reasons why I am a little disappointed that the Greens are not supporting this bill. I understand the Green Party’s opposition to student loans from a philosophical perspective but within the legislative framework in which we currently work I think this bill moves us forward quite a long way and it would be good if the Greens could view it from within that legislative framework and support this bill for those reasons. 
This change reflects a special relationship that has been talked about that realm countries—I like the words “realm countries”; I thought they were quite outdated but let us keep them in there—have with New Zealand and aims to encourage borrowers who want to remain and make a contribution to those countries to do so. We have talked about the costs and benefits of globalisation but I think nothing is more important than empowering communities certainly within the realm countries mentioned here. If students can go back and contribute to their communities in a way that their education allows it can only be good for their communities and their countries let alone their own professional development. 
The key feature of this amendment relates to section 38AE of the Student Loan Scheme Act 1992. As mentioned it is being amended to allow further exemption to the requirement that borrowers reside in New Zealand. It means that borrowers will qualify for the interest-free loan if they are present in a realm country—Niue the Cook Islands Tokelau or the Ross Dependency—for 183 days or more. There is a little bit of a catch—well not a catch. The purpose of the amendment is to encourage those who want to live in and make a contribution to these countries to do so which is very important. Their student loans will be interest-free as if they are still living and working in New Zealand. My colleague Kelvin Davis said he was of an era where he did not have a student loan so it is hard to imagine. I caught the very end of student loans with interest and when I bought my first house the interest rate on my mortgage was lower than the interest rate on my student loan so I just tacked it on to the end of the mortgage. Thank goodness those days are over. 
I will talk about something else as well. The bill introduces an extension of the interest-free loan entitlement to students engaged in full-time study overseas under a formal exchange programme approved by the New Zealand Government or a formal agreement between a New Zealand education provider and an overseas tertiary education provider. It corrects an oversight in earlier legislation that disadvantaged certain borrowers studying overseas. Again this amendment brings us back to where we see ourselves in the world the whole area of globalisation and importing talents and skills back to this country. In the past—and there are members of this Committee who have done this—students went overseas to study and felt that their real place in society was overseas marketing their skills in different areas. This amendment allows them to come back and contribute to society in a meaningful way. 
Let us look at a bit of background on this amendment. Provisions in effect from 1 April 2000 to 31 March 2007 entitled borrowers who were resident in New Zealand for income tax purposes to a full interest write-off if they were engaged in full-time full-year study. Part-time or part-yearstudentscouldalsoqualifyiftheirincome was below a certainlevel. The student’s New Zealand tertiary education provider was required to confirm the level of study. As this had the same effect as allowing a loan to be interest-free when the extension of the exemption to undergraduate study was made it was considered that these provisions were redundant and they were repealed. There is therefore a gap in interest-free loans for some students who are or were studying overseas. 
Hon PETER DUNNE (Minister of Revenue) 
: 
 I will take just a brief call to respond to some of the questions that have been raised since my last intervention on the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. Mr Hipkins raised some questions about the repayment threshold and the decision that was made late last year not to increase it for this year. There are a couple of things I would say in respect of that. Firstly members will see that the bill introduces a much more transparent set of provisions for setting the interest rate that is to be payable where required and that was because I felt that the previous system allowed for a bit of manipulation. This is a clearer and more transparent way of doing it. However with regard to the determination of the income threshold although the member might be able to make the same argument in practice the reality is that some other factors also have to be taken into account. My recollection is that when the calculation was done last year as to what an increase might be given other movements that had taken place it was very minimal. Although there was a cost of around $9.6 million or something of that order which I think the member quoted from my statement the actual benefit per person was from memory something in the order of a few cents per week. On that point given the economic circumstances and the practicality we decided not to proceed. We will have to go through the same calculation at the end of this year and obviously take this year’s circumstances into account in setting that. 
Mr Robertson raised a question regarding the hardship provisions and also a general question with regard to keeping people informed of changes. I want to be absolutely clear about the hardship provisions. They take us back to where we were prior to an unintended amendment a couple of years ago. The 15 percent rate issue which the member also spoke about will be applied only in circumstances where the borrowers are in New Zealand and are receiving wages and salaries. It will be taken on a case by case basis. This decision is not arbitrary; it is designed to deal with that situation when we are fairly certain that people are here but not paying what they should pay and there will be the capacity for the commissioner to draw attention to that. 
All of that leads me neatly to the next question that Mr Robertson raised when he said that that was all very well it was a good idea and he supported it etc. but then asked how people would be kept informed about it. I think that is a critical question. Over the last couple of years we have been tending to make much more use of interactive technologies to draw borrowers’ attention to their responsibilities. I remind the member that when we did the work in 2007 to try to get a handle on how many overseas borrowers there were we used popular websites like the  
New Zealand Herald  
website—we put sidebar advertisements on it—and from memory the Stuff website because they are sites accessed by people overseas. A lot of that will continue. The usual work in drawing borrowers’ attention to the new provisions at the time they become liable will also continue. 
Again I will just conclude with the comment I made in my first intervention. Once we change the whole system and the way in which it operates to become much more interactive over the next year or so then a lot of these things will become much easier to resolve. 
Hon MARYAN STREET (Labour) 
: 
 I want to make a couple of comments and first of all thank the Minister of Revenue for his comments about spouses of diplomats because that was something that has been discussed. I cannot remember whether we discussed it at the select committee itself or whether just the Labour members have been discussing it amongst ourselves. Certainly the Minister referred to keeping the issue under some sort of review. Amongst the agencies that have some interest here the Inland Revenue Department the Ministry of Education and the Ministry of Foreign Affairs and Trade it would be possible for that to slip through the cracks and I would urge the Minister that it not slip through the cracks. In fact although it is possible under this legislation as it currently stands for a partner or spouse of a diplomat to qualify by virtue of being part of an approved tertiary institution course that is recognised for the purposes of this legislation and in that way he or she could get in it would be useful to clarify that tax status so that we know for sure whether such spouses and partners would be eligible. I think that is also of benefit when one thinks that these are people who work in the service of New Zealand go offshore for a time and inevitably come back and if a partner or spouse can come back better skilled to contribute in his or her own right as well then we should facilitate that. I thank the Minister for that consideration and hope that it does not fall from view. 
The other thing I want to talk about is something I had referred to earlier when I spoke about tertiary institutions turning away students at the moment and I used the example of the Universal College of Learning. In fact it would appear that if the student demand continues as it is tracking at the moment at that college where there have been 500 more students than last year apply for courses which is something in the order of a 19 percent increase on its past roll if that continues then the chief executive officer of the college says they will have to close the doors some time between May and August. That is an issue that needs to be addressed by the Minister for Tertiary Education—admittedly—but again it underscores the point that this legislation is trying to make the student loan scheme accessible to more people at a time when the Government is not entertaining increasing student numbers lifting caps renegotiating them or any other way of investing in the tertiary education system. 
There is one particular exception and it goes to the speech that my colleague Kelvin Davis made earlier. I refer to—and the Chair will be pleased I am not going to seek to table it—an article that was in the Christchurch  
Press  
over the weekend on Saturday 20 February about the launch by Pita Sharples of a new guide for universities to support Maori students to succeed. Every indication we have had from the Prime Minister and the Minister for Tertiary Education to date has been that there will be closer examination of success and whether people will be able to continue to apply for and be eligible for student loans. Kelvin Davies and my colleague Carmel Sepuloni have expressed a concern from their own experience and that of their own whanau and whanaunga for Maori and Pasifika students who come perhaps not from a background in the majority of cases that is accustomed to tertiary education. There is not an embedded understanding within the family of what it takes to support somebody to succeed and therefore additional support from an institution is required. 
CHRIS TREMAIN (Senior Whip—National) 
: 
 I move  
That the question be now put 
. 
A party vote was called for on the question  
That the question be now put. 
Ayes 69 
New Zealand National 58; ACT New Zealand 5; Maori Party 5; United Future 1. 
Noes 53 
New Zealand Labour 43; Green Party 9; Progressive 1. 
Motion agreed to. 
Part 1 agreed to. 
Part 2 Consequential amendments to and revocations of other enactments 
Hon MARYAN STREET (Labour) 
: 
 Part 2 of the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill is technical in nature. The bill itself is technical in nature but Part 2 simply draws other legislation into alignment through a series of consequential amendments. The consequential amendments or the revocation of certain parts of legislation are now referred to in Part 2 in order to make the whole set internally consistent. There are amendments to the Tax Administration Act there are consequential revocations of enactments such as the Student Loan Scheme (Income Amount for Full Interest Write-off) Regulations 2005 and parts also from 2006 and 2009 are being revoked. 
The need to keep the legislation consistent is important. It is imperative but it also raises for me the same question that I have referred to previously and that is the extent to which the consistency reflected in Part 2 is the consistency reflected in the Government’s approach to tertiary education. Previously when I spoke about this it was clear from some of the interjections opposite that Government members thought that this was simply Labour saying again: “Spend spend spend and don’t make any cuts anywhere.” 
Government appropriations have always and ever been about the ordering of priorities. This party is saying that in order to be not only consistent but also progressive about tertiary education opportunities and the benefits that accrue to the country from giving more people access to tertiary education those opportunities should not be lost sight of and should be made consistent across Government policy. 
The consistencies that are reflected by Part 2 come into question when the whole approach to tertiary education policy is looked at. We are not any longer in the days that we were in when I first went to Victoria University some considerable time ago. I remember queuing to pay 10 percent of the course fees in the student union building at Victoria University. We have long since moved on from those days. I wish that our newest member of this House still had such a regime available to him but that is no longer the case. Now it takes active investment on the part of the Government to ensure that tertiary education is available to all. My father gave me $100 and my mother bought me a coat to cope with the Wellington winter and on the strength of those gifts and a bursary from high school I went to Victoria University. I was able on the strength of the facilities available at that time to give my father back the $100 at the end of my first year with some careful stewardship I have to say of the money that I did get. I did not emerge with a student loan. 
Times have changed without a doubt and I wish that things were easier for students now but they are not. That is why it is incumbent upon the Government to actively invest in tertiary education opportunities. The consistency of approach to tertiary education should mirror the consistency that the Minister has achieved in Part 2. Thank you. 
Hon TREVOR MALLARD (Labour—Hutt South) 
: 
 This Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill is relatively uncontroversial. I was lucky to be a member of the Education and Science Committee that was dealing with it at the time and I am pleased to be able to speak to Part 2. It is fair to say that relatively speaking Part 2 is the smaller part of this bill but it includes consequential amendments and areas that people need to talk about. I acknowledge that although we did not always agree with the policy and although some of the options that were put up were not picked up by the Government the officials did a good job. 
Some regulations are being revoked as part of this legislation. I say to the Minister in the chair the Minister of Revenue that it is good to use primary legislation to revoke regulations because it means that the provision is on the face of the legislation rather than people having to dive away to other areas to work their way through the particular issues. Frankly it is a bit sad that we need legislation for some of these things—such as clause 29 “Officers to maintain secrecy”—but we do. However the change there is a very small consequential amendment which omits “ (2AA)” from section 81(4)(g) of the Tax Administration Act. That is an effect of something else earlier on being revoked. It is fair to say that this legislation is in the tidy-up category of legislation. 
I have some problems with my colleagues from the Green Party over this legislation. Even though we all have the policy intention of heading towards free tertiary education the idea that those members would vote against consequential amendments in a relatively minor bill because they are opposed to people at university being charged fees I think goes beyond a stand on principle to a stance that is pretty hard to explain. I was slightly surprised at that. 
Hon Maryan Street 
: What sort of student were you? 
Hon TREVOR MALLARD 
: I was a student in the era slightly before that of my colleague Maryan Street I think—when I look at her—but I was at the same institution. I was of the group that did not do a seventh form year—or 6A I think they called it. I went to university at that stage. 
Hon Maryan Street 
: You’re a child prodigy! 
Hon TREVOR MALLARD 
: Well I was 16½; I was old enough. But as a result of my slightly better than mediocre work in my first year I ended up getting a bursary in my second year. That was the way that it worked. I cannot remember the bursary being an enormous amount of money but the fees— 
Hon Maryan Street 
: A late developer. 
Hon TREVOR MALLARD 
: Well I was an early developer actually. I ended up a year’s extra study ahead of my colleagues who had stayed at school we ended up with about the same bursary and I had had a much better time than they had had over that period. But how much of that time was at the— 
Hon Maryan Street 
: Did you join the students association? 
Hon TREVOR MALLARD 
: I think it was automatic at that stage. But I did “cafe honours” and it was good. Bob Moodie used to be there in his kaftan. Jim Baxter would be reciting poetry. I tell you what Jim Baxter’s poetry was nowhere near as interesting as this bill; there was some really interesting poetry but none of it came close to Part 2 of the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. He never came close. But I must say it was a particularly interesting time. 
CARMEL SEPULONI (Labour) 
: 
 I was really enjoying Trevor Mallard’s contribution to the debate and I hoped that he would seek a second call but he did not. Part 2 of the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill is basically about consistency. There is really not very much to discuss with regard to what is in this part so I will go back to some of the other things that we have discussed. 
A few members have discussed the fact that they accessed student loans and what that meant for them. We are seeing that student loans will perhaps be in jeopardy moving forward with some of the public comments that have been made by members opposite including the Prime Minister and also unfortunately the Minister for Tertiary Education. The newest member of Parliament Gareth Hughes pointed out the fact that he is another former student who is paying back his student loan. As I said earlier I am nearly there. After 9 years of trying to pay back a student loan—not after 9 years of a great Labour Government—I have nearly finished paying it off. 
One thing that has come up publicly again is the issue of students who do not necessarily finish their degrees diplomas or study on time and the fact that this Government may be looking to making it difficult for them to access student loans for the full extent of their study. I point out something that I pointed out earlier which is that unfortunately in this country Maori and Pacific people still take longer to complete their tertiary qualifications in terms of degrees and diplomas. That is not because of lesser intelligence— 
Charles Chauvel 
: Or greater beauty. 
CARMEL SEPULONI 
: —and not because of greater beauty as Charles Chauvel has pointed out but because many Maori and Pacific students are still the first in their family to go to university or to do higher-level tertiary study and it is a very very strange experience for them. Many of our people are not accustomed to it especially when other family members have not done it before and that can result in a few failures in the first year or the second year. 
Debate interrupted. 
Sitting suspended from 1 p.m. to 2 p.m. 
Questions to Ministers 
Economy—Benefits of Rebalancing 
1. 
PESETA SAM LOTU-IIGA (National—Maungakiekie) 
 to the  
Minister of Finance 
: Why is the Government intent on rebalancing the economy and what benefits will that bring? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 The Government needs to work on pushing our resources back to where New Zealand has a competitive advantage. This is a big job. Our tradable sector has been in a 5-year recession during which its output has declined by 10 percent. By contrast the non-tradable side of the economy has grown by 12 percent but we do need to reorient it in order to create sustainable jobs and higher incomes. 
Peseta Sam Lotu-Iiga 
: Which sectors have performed the best and the worst over the past 5 years? 
Hon BILL ENGLISH 
: The major weaknesses have been concentrated in services and manufacturing. Exports of services have fallen by 18 percent in real terms since 2004 and every category of manufacturing has shown a similar decline. This includes major areas such as food processing which is a core part of our economy. In fact the overall output of the tradable industries has now not increased since 2002. By far the strongest sector of the economy has been Government administration which has grown by 29 percent in real terms since 2004. Clearly this divergence cannot continue. 
Peseta Sam Lotu-Iiga 
: What impact on New Zealanders has this unbalanced economic performance produced? 
Hon BILL ENGLISH 
: An unbalanced economy tends to hold growth back. That is why this economy grew by less than 1 percent per year in the 3 years before the global crisis arrived. This is a big drain on the potential for higher incomes in New Zealand. Had the economy grown at its normal rate over the past 5 years the average household income would now be $5000 per year higher after tax than it is. 
Hon Sir Roger Douglas 
: Does the Minister agree that any rebalancing must focus on private sector job creation; if so can he explain to the House how it makes sense to prohibit young people from accepting a job at the rate of $10 per hour or $400 per week and in the process force them on to the unemployment benefit where they receive about $3 per hour or $120 per week without contributing anything to society? 
Hon BILL ENGLISH 
: The Government shares that member’s concern about the high number of young people who are unemployed. We will have the opportunity to discuss his solution as he brings his bill the Minimum Wage (Mitigation of Youth Unemployment) Amendment Bill to the House. 
Peseta Sam Lotu-Iiga 
: What steps is the Government taking to rebalance the economy? 
Hon BILL ENGLISH 
: The range of measures that are in place was outlined in the Prime Minister’s statement to the House a few weeks ago. Currently we are considering the advice from the Tax Working Group which advises on ensuring there is more uniform taxation of all sectors including property and on switching from our reliance on consumption and income taxes. We believe this could give New Zealanders better incentives to work save invest and reduce their tendency to consume more than they earn by borrowing to make up the difference. 
Social Development and Employment Programmes—Reports 
2. 
Hon ANNETTE KING (Deputy Leader—Labour) 
 to the  
Minister for Social Development and Employment 
: What reports if any has she received on programmes she has put in place since she became Minister? 
Hon PAULA BENNETT (Minister for Social Development and Employment) 
: 
 I have received a number of reports that show that the programmes put in place since National came into Government have been achieving well. 
Hon Annette King 
: Does she agree with the Hon John Key who said that New Zealand needs fewer politically correct programmes like listening to music and we need closer alignment between our economic needs and Government-supported programmes to ensure people flow into trades and apprenticeships; if not why not? 
Hon PAULA BENNETT 
: I certainly agree with the Prime Minister particularly when he talks about the need for us to create real jobs for young people and for New Zealanders out there. It is about a bigger programme than just one particular need. It is about real jobs. It is about giving businesses confidence so that they can invest and employ more people. 
Hon Annette King 
: Does she agree with the Hon Bill English who said that it was a nonsense to spend money on dodgy community programmes when the economy is suffering from a lack of skilled workers; if not why not? 
Hon PAULA BENNETT 
: I certainly agree with the Minister of Finance when he talks about how we need to assist those young people at this time with some Government initiatives. It is about the right investment. It is about infrastructure programmes. It is about the Government putting the money where it needs to be so that businesses have that confidence to grow more real jobs for our young people. 
Katrina Shanks 
: Can she give us example of how the Government is working hard to ensure the success of its programmes? 
Hon PAULA BENNETT 
: The Government is taking a long hard look at the way we contract with the non-governmental organisation sector and the relationships that we have with communities. We are not just pointing at providers and saying that they have to change. We are saying that if we want different outcomes we have to do things differently. We have to change the way we contract which is why I am delighted that more high-trust contracts with non-governmental organisations are about to be signed. 
Hon Annette King 
: Are the criteria for Community Max still to support the completion of projects that benefit the community or the environment creating jobs for young people and providing an opportunity for them to build skills and work experience while contributing to the community; if not what are the criteria? 
Hon PAULA BENNETT 
: Yes that is part of the criteria. But I want to be quite clear that this Government is not over-prescriptive. We are backing communities to get on with it and do what is best for them within their communities. I must admit that when designing this programme we did not take the control freak approach that we have certainly seen in the past. We trust those we contract with to get on with the delivery and do what is best for their communities. 
Hone Harawira 
: Has the Minister seen the many enthusiastic reports showing how Community Max participants are now confident knowledgable and skilled enough to begin employment or training? What incentives are being developed to create supported training work options and jobs to build on this success? 
Hon PAULA BENNETT 
: Yes I have seen many reports of positive outcomes from Community Max. I know that the member himself has certainly approached me many times with good-news stories of how it is working in his community to keep young people on. The follow-up is most important. We need to make sure that we are addressing long-term real jobs at the end of it. 
Hon Annette King 
: Does the use of Community Max funding—which by one provider’s own admission is a recruitment tool for a rugby league team paying 18 young men for 30 hours a week to have an opportunity in their sport with no literacy numeracy or particular skill or training provided—meet the Community Max criteria or the promise of the Prime Minister and Minister of Finance to get rid of dodgy politically correct programmes; if so— 
Mr SPEAKER 
: I ask members to show some courtesy. There is a structured question being asked and the House should hear it. 
Hon Annette King 
: For such a programme to exist under her watch will she tender her resignation for failing to meet the high standards that the Prime Minister has set for his Ministers? 
Hon PAULA BENNETT 
: I am not aware of the particular programme that the member is talking about. But I will say that the previous Government was so controlling—it had to be only its way; it had to tick certain boxes—that it did not support young people to be engaged and have real— 
Mr SPEAKER 
: I apologise to the Minister but on this occasion I ask the Opposition to show a little respect. A question has been asked in fact by the Opposition. Even if Opposition members are not interested in hearing the answer I am. 
Hon PAULA BENNETT 
: As far as Community Max is concerned we have put it back to the communities to look at what is best for them in their environment. 
Hon Annette King 
: Blame them. 
Hon PAULA BENNETT 
: I am not blaming them at all. I think they are doing a fantastic job. That is certainly the difference between us and Labour. The communities are stepping up and finding real opportunities for their young people. One way to engage them is through sporting activities. So I will back them. There will be the odd time that we need to go back and check on some things but I reckon they are doing a fantastic job and it is working well. 
Hon Annette King 
: Is accountability for the expenditure of taxpayers’ money an important part of this Government’s programme? 
Hon PAULA BENNETT 
: Yes it certainly is. Amusingly enough just last week the criticism from Labour in this House was that we were not extending Community Max. It wanted to see more programmes and now says there are bad things. It is bit like any policy we have seen from the other side it is sort of up and down and all around and not really well structured. 
Hone Harawira 
: What assurance can she give the House that the Community Max programme which has been very successful in and warmly welcomed by rural Maori communities right throughout the country will be sustained beyond the next financial year? 
Hon PAULA BENNETT 
: We are pleased how the programme has developed. It has always been time limited it was always a recessionary measure and Cabinet did put a major investment in that but there have been no obligations for that since then. 
Radio New Zealand—Funding 
3. 
SUE KEDGLEY (Green) 
 to the  
Minister of Broadcasting 
: Has he told Radio New Zealand that its funding will be frozen for a number of years; if so how many? 
Hon MAURICE WILLIAMSON (Minister for Building and Construction) 
 on behalf of the  
Minister of Broadcasting 
: The Minister has made it clear to the Radio New Zealand board that like a number of other Government agencies Radio New Zealand must live within its current baselines. 
Dr Russel Norman 
: I raise a point of order Mr Speaker. The Minister has had this question for some time. It is a pretty straightforward question: have the funds been frozen; if so for how long? There was no attempt to address either part of the question. 
Mr SPEAKER 
: I appreciate the point the member is making because the question is on notice and it does ask “if so how many” years. I ask the Minister to respond because the answer could be interpreted as meaning indefinitely. I ask the Minister to respond to that part of the question. 
Hon MAURICE WILLIAMSON 
: As many members of this House will know funding changes year by year. However for the foreseeable 2 to 3-year baseline out-years Radio New Zealand has been asked to live within that baseline. 
Sue Kedgley 
: Why is he ignoring the advice of the board and chief executive of Radio New Zealand that current funding levels are already unsustainable and that any freeze in funding will undermine the quality and standards of Radio New Zealand and its charter? 
Hon MAURICE WILLIAMSON 
: It is quite the opposite. I quote from a letter to Dr Coleman from Christine Grice the chairman dated 21 January—that is just last month—in which Ms Grice says: “The board is satisfied that the funding gap will be bridged to meet the requirements you laid out at our December meeting as being the bottom-line requirements to enable Radio New Zealand to manage within the present funding over the next 2 to 3 years while meeting its statutory and charter obligations on a sustainable basis and be ready for this implementation on 31 March.” 
David Garrett 
: Does the Minister know through the radio ratings how many people listen to Radio New Zealand or is he like the rest of the New Zealand taxpayers who fund it kept in the dark about listener numbers? 
Hon MAURICE WILLIAMSON 
: I do not have those ratings but I think they are very well publicised. 
Sue Kedgley 
: Is not a freeze in baseline funding really a cut when other costs for rent transmission power and so forth are all going up? 
Hon MAURICE WILLIAMSON 
: No it is not. Many Government organisations find a number of various ways in which they can make savings—savings they should have been making over many years. Those savings can allow for at least the same if not an even better product to be delivered over time within those baselines. 
Sue Kedgley 
: Why did the Minister give the Radio New Zealand board an ultimatum to change its mindset and adopt a more commercial approach or else in his letter to the chair of the Radio New Zealand board on 2 February? 
Hon MAURICE WILLIAMSON 
: The Minister has not given any clear direction to Radio New Zealand about what it must do to achieve the goal. All he has asked it to do is to make sure it can work within its baselines and to reply to him in detail about how it will achieve it. So all the rumour-mongering and scare-mongering that the Minister has directed Radio New Zealand to cut FM or to start getting sponsorship is not correct. 
Sue Kedgley 
: What did he mean then when he demanded that the board change its mindset and look at alternative revenue models—in other words adopt a more commercial approach—when Radio New Zealand’s legislation says explicitly that it must be free of advertising and sponsorship and must remain commercial-free? 
Hon MAURICE WILLIAMSON 
: I am quite perplexed as to why the questioning carries on given that I have read a letter from the chair of Radio New Zealand who says that Radio New Zealand can deliver all its statutory and charter obligations from within the current baselines. I am really not sure what the member is on about. 
Clare Curran 
: What level of cuts in programming at Radio New Zealand is he prepared to accept? 
Hon MAURICE WILLIAMSON 
: Again I refer the member to the statements the Minister has made. He wants Radio New Zealand to look at its service and its delivery and to look at how it can make changes as so many other Government departments and agencies have been asked to do to find out areas that can be made more efficient that can deliver things better and more cost-effectively but without reducing its ability to deliver both its statutory and its charter obligations. I would have thought Labour would think that was an absolutely perfectly natural thing to do with any Government agency. 
Sue Kedgley 
: Does he agree that some of the options for cost savings that Radio New Zealand has been forced to consider such as reducing its regional news coverage will undermine the quality of Radio New Zealand programmes and its charter? 
Hon MAURICE WILLIAMSON 
: Once again I am quite gobsmacked. Radio New Zealand has not been forced to consider anything. It has been asked to come back with a plan about how it will deliver the requirements under the Act and the charter within its baselines. It will make the decision about what changes it makes to its operations; it is not being directed to do any specific thing. 
Sue Kedgley 
: Has he discussed Radio New Zealand’s funding with any chief executives from private sector radio such as the former MediaWorks chief executive Brent Impey who campaigned last year for cuts to Radio New Zealand? 
Hon MAURICE WILLIAMSON 
: Because I am answering on behalf of the Minister it would be impossible for me to answer that question. 
Question No. 8 to Minister 
Hon TREVOR MALLARD (Labour—Hutt South) 
: 
 In order to assist the Minister of Education with her answer to question No. 8 I seek leave to table an email invitation to Andrew Oh of the board of trustees of the now abolished Aorangi School inviting him to a “web-inar” to be held on 8 March. 
Mr SPEAKER 
: This is an invitation to— 
Hon TREVOR MALLARD 
: This is an invitation to someone who has been tossed off the— 
Mr SPEAKER 
: The source of this document is— 
Hon TREVOR MALLARD 
: Andrew Oh. It is an email that was sent to him on her behalf. 
Hon Gerry Brownlee 
: Can we have more explanation? Mrs Tolley’s email to this guy is being tabled by Trevor? 
Mr SPEAKER 
: If the member wants to raise a point of order he is more than welcome to do so if he wants clarification. I see that the House is confused. Could the member clarify exactly what this document is. 
Hon TREVOR MALLARD 
: It was sent on behalf of the Minister it is about one of the ministerial-approved training sessions and it is to Andrew Oh who used to be a member of the board of trustees at Aorangi School. She is sending it to a trustee of an abolished school. 
Mr SPEAKER 
: Is the member saying this document was sent by the Ministry of Education? 
Hon TREVOR MALLARD 
: Yes. 
Mr SPEAKER 
: Leave is sought to table that document from the Ministry of Education. Is there any objection? There is no objection. 
Document by leave laid on the Table of the House. 
Finance Minister—Statements 
4. 
Hon DAVID CUNLIFFE (Labour—New Lynn) 
 to the  
Minister of Finance 
: Does he stand by all his recent statements? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 Yes particularly those statements in respect of the weak performance of the New Zealand economy in the last term of the previous Labour Government. 
Hon David Cunliffe 
: Which statement is correct: his claim to this House recently that over the past 10 years the New Zealand economy performed very poorly or the statement he made 5 minutes later to the House that over the past 10 years the economy grew significantly? 
Hon BILL ENGLISH 
: I would not necessarily take that member’s representations of my statements at face value. But I can understand why he is sensitive about the fact that New Zealand’s economy grew poorly under his management at a time when the rest of the world was growing strongly. 
Hon Darren Hughes 
: I raise a point of order Mr Speaker. My colleague David Cunliffe put to the Minister a question containing two quotes from the Minister—the person of whom he is actually asking the question. So far all the answers have been about David Cunliffe and not Bill English. I do not think it is fair for the Minister to get up and say he understands why the member is sensitive or embarrassed or whatever it might be. He should just answer the question. [ 
Interruption 
] 
Mr SPEAKER 
: There should not be interjections—[ 
Interruption 
] I am on my feet now. What is more points of order should be heard in silence. I expect that. I think the difficulty with the question as asked is that the Minister clearly as he started his answer disputed the context of the components of the member’s question. As the question is not a question on notice there has been no authentication of the validity of the context of the two quotes and that is why I cannot insist on a particular answer. 
Hon David Cunliffe 
: I raise a point of order Mr Speaker. If the difficulty was in the way that the question was phrased may I seek leave to rephrase that question? 
Mr SPEAKER 
: No. The member asked his question and got an answer. 
Aaron Gilmore 
: What statements has the Minister made about the Government’s economic priorities for 2010? 
Hon BILL ENGLISH 
: The statements I have made about the economy looking ahead are focused on the need to rebalance the economy and on the Government’s programme for doing so. We simply cannot continue to be a country that spends more than it earns and tries to create wealth by people buying and selling houses off each other. 
Hon David Cunliffe 
: How does he reconcile his statement that between 2005 and 2008 “this economy grew by less than 1 percent per year” with official statistics that show that the economy grew at almost twice the rate he has claimed? 
Hon BILL ENGLISH 
: I think the member is retelling a story from a couple of weeks ago on one of those left-wing blogs and the problem there is that he is using nominal growth in the economy when the standard measure is real growth in the economy. 
Hon David Cunliffe 
: Can the Minister confirm that during the last year of National’s administration from September to September GDP actually declined by 2.2 percent? 
Hon BILL ENGLISH 
: I can confirm that and I am pleased that the member has discovered that. But this Government is dealing with the economy as it found it and the fact is that from about 2005 onwards the Government sector grew strongly and our earning capacity shrank. We then had a global crisis and it is our job to clean up that mess. 
Hon David Cunliffe 
: Is the Minister aware that over the 9 years of the Labour Government GDP growth averaged 3.2 percent which is higher than under the previous National Government and obviously his own; and is he further aware that that strong and sustained expansion was achieved at the same time that net debt was cut to zero gross debt was cut in half unemployment was less than half the current rate thousands of New Zealanders were lifted out of poverty and the minimum and average wages rose every year; if so why does he not just admit to New Zealanders what is patently obvious: that he is shonky in his use of figures and he has no plan for growth? 
Hon BILL ENGLISH 
: I think that shows why Labour got into Opposition and is staying in Opposition. Labour is unable to understand the negative impact that it had on this country and on the thousands of people who have no jobs or little job security because of the poor economic management in the last years of the previous Labour Government. 
Prisons—Steps to Reduce Risks to Staff 
5. 
Dr CAM CALDER (National) 
 to the  
Minister of Corrections 
: What steps are being taken to reduce the risk of assaults on prison staff? 
Hon JUDITH COLLINS (Minister of Corrections) 
: 
 This Government is serious about reducing the risk faced by front-line staff. Corrections officers are managing some of the most difficult and dangerous individuals in our country. I am pleased to report that the Department of Corrections is currently providing all of its 3000 prison staff with tactical communication training and de-escalation training. It has already trained more than a third of its staff. Staff have provided examples of situations where as a result of this training highly tense situations have been safely defused. 
Dr Cam Calder 
: What else is she doing to ensure that prison staff are safe at work? 
Hon JUDITH COLLINS 
: Tomorrow at Spring Hill Corrections Facility I will officially launch the roll-out of stab-resistant body armour spit hoods and batons. The department will also begin a 12-month trial of pepper spray. This equipment will help prison staff to manage hostile situations. The spit hoods will protect staff from saliva and blood and the batons will be used by specially trained staff as a last resort. The last administration had 9 years to make prison staff safer and did nothing. 
Health Services—Access 
6. 
Hon RUTH DYSON (Labour—Port Hills) 
 to the  
Minister of Health 
: Can he guarantee New Zealanders will not have reduced access to health services this year? 
Hon TONY RYALL (Minister of Health) 
: 
 There is more money in Vote Health than under the previous Government and there are more front-line services being delivered overall. 
Hon Ruth Dyson 
: Why did he give Parliament contradictory answers when I asked him about assessments: first saying that everyone would be assessed and then later in an answer to the same question saying that everyone who wants an assessment would get one; and how do those comments line up against the announcement from the Otago and Southland district health boards that there will be no assessment for any client receiving 1 or 1½ hours of home support a week and that they will just have that home help cut? 
Hon TONY RYALL 
: With regard to the later point the Otago District Health Board has made it clear that all those people will be offered an assessment and if they seek an assessment their hours will be maintained. 
Hon Ruth Dyson 
: When he made the offer on Tuesday to personally intervene in any individual case of home support cuts did he know that his ministerial colleague’s office in Southland had told a 76-year-old woman with leukaemia that the cuts to her home support were “nothing to do with the Government”? 
Hon TONY RYALL 
: I would be unable to confirm the veracity of the member’s claim but I tell the member that if she has any constituent cases of people being unable to stay in their homes or of their not being safe then those cases should be brought to our attention and we will take action. 
Hon Ruth Dyson 
: I raise a point of order Mr Speaker. In the introductory comments to his answer the Minister implied that what I was saying was untrue. That is unparliamentary— 
Mr SPEAKER 
: I ask the member to resume her seat. I do not think the Minister said that. He said he could not establish the veracity of the information contained in the question. I think that that is not accusing the member of anything— 
Hon Ruth Dyson 
: Very close. 
Mr SPEAKER 
: The member is doubting it and that is fair enough but the Minister is not accusing the member of saying anything false at all. I think it would be incorrect to interpret it that way. 
Dr Paul Hutchison 
: Why are the Otago and Southland district health boards having to review services being provided to their communities? 
Hon TONY RYALL 
: We have inherited significant clinical and financial problems in the Otago and Southland district health boards. These issues have been longstanding and unresolved creating much uncertainty for local people and staff. These pressures are a large part of why locally they have come to the conclusion that the two boards should come together. This financial year the National-led Government increased funding for Otago-Southland by $28 million which goes only some way to dealing with the $20 million of unfunded services we have inherited. We are endeavouring to fill this gap steadily over some years which is essential to securing the future of local health services for the people of Otago-Southland. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. I apologise for being one supplementary question behind because I wanted to remind myself of my old Latin and the word “veracity”. The definition as I think it is goes to truthfulness and honesty. The Minister used that word in relation to the information supplied by the Hon Ruth Dyson. If the Minister had said it was factually incorrect wrong or inaccurate that would be fine. But doubting someone’s truthfulness or honesty is something that this House has not allowed in the past. 
Mr SPEAKER 
: I am not going to go back to this particular issue. Although I accept the member has looked up the meaning of “veracity” in the  
Collins English Dictionary 
—I totally accept that—I think in common usage today it does not mean to imply that someone is intentionally not telling the truth. I think the Minister was questioning the facts that were put in front of the House. As it is a supplementary question we cannot validate the facts. Ministers are entitled to disagree with the facts. They do need to be careful how they do that but I do not believe that questioning the veracity of the facts is in any way implying that the member was being in any way untruthful at all. I do not think we should get too pedantic in ruling out too many things. 
Chester Borrows 
: I seek leave to table correspondence between myself and the then Minister for Disability Issues relating to an incident on 4 September 2007 when 300 people had their home care cut in Wanganui City followed the following year by a similar number. 
Mr SPEAKER 
: Leave is sought for that document to be tabled. Is there any objection? There is objection. 
Hon Ruth Dyson 
: What will happen to older people in Southland who not only are facing these cuts to their home support but have now been told by the district health board that it will cut the number of people entering rest homes by 1000? 
Hon TONY RYALL 
: I have rung the chief executive of the district health board. We can tell the member that as I have said earlier if there is any evidence that someone is going to be unsafe in his or her home or will be unable to stay in his or her home as a result of the changes to home care then those matters will be taken up. We are dealing with a legacy of neglect with the Otago and Southland district health boards. The previous Government left them with over $20 million of unfunded services and we are dealing with that. 
Sue Kedgley 
: I raise a point of order Mr Speaker. The Minister continued to address the issue of home care in his answer when in fact the question was on the number of people entering rest homes. I wonder whether the Minister did not realise that we had moved on to rest homes. Could he then attempt to answer the question about how many cuts to people entering rest homes? 
Mr SPEAKER 
: I must confess the member has caught me there; I did not pick that up. The question was the question of the Hon Ruth Dyson was it not? Does the member feel that her question was not answered at all? 
Hon Ruth Dyson 
: Consistently. 
Mr SPEAKER 
: Silly me I guess in asking such a question. Given that such a question has arisen under a point of order I will invite the member to repeat her question so long as she does repeat the question she asked. 
Hon Ruth Dyson 
: What will happen to older people in Southland who not only face these cuts but have now been told by the district health board that it will cut the number of people entering rest homes by 1000? 
Hon TONY RYALL 
: What will happen to these people in Southland is that they will realise that those people who are seeking rest home care will still get the assessments that the member is worried about. But what Mrs Dyson needs to realise is that the Government has inherited a very difficult situation at Otago-Southland which has created a lot of uncertainty for staff and we are endeavouring to deal with the $20 million of unfunded services that we inherited from the previous Government. 
Hon Ruth Dyson 
: I seek leave to table comments from Mr Peter Harding an 81-year-old Invercargill man who has agreed for his name and feelings to be made known publicly who says— 
Mr SPEAKER 
: Before the member goes through what has been said can I establish the source of the document because leave is being sought to table a document. 
Hon Ruth Dyson 
: It is Mr Peter Harding an 81-year-old Invercargill man as reported in the  
Southland Times  
yesterday. 
Mr SPEAKER 
: No I think we will not be seeking leave to table reports from yesterday in a significant newspaper. 
Dr Paul Hutchison 
: What changes to patient services if any is he aware of that have been undertaken in recent years as district health boards look to live within their means? 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. I am just making sure that you are going to remind the Minister to stay within areas of his responsibility. 
Mr SPEAKER 
: I do not think the member should be pre-empting by way of a point of order what Ministers may say. 
Hon TONY RYALL 
: I am aware of a number of changes to patient services under the previous Government for which I have seen reports such as the hundreds of people who had their home-cleaning services stopped in Wanganui a few years ago while Ruth Dyson was the Minister for Disability Issues. One would be very confident on the basis of this week’s apparent outrage from Ruth Dyson that she would have fought these home-cleaning changes tooth and nail. But after searching high and low for copies of press statements letters or even a whisper no one can find a snippet of protest from Ruth Dyson. 
Project Protector—Progress 
7. 
TODD McCLAY (National—Rotorua) 
 to the  
Minister of Defence 
: What progress has been made with Project Protector? 
Hon Dr WAYNE MAPP (Minister of Defence) 
: 
 We have now taken delivery of the first of the two offshore patrol vessels the  
Otago.  
The delivery of the second the  
Wellington 
 will take place in April. This completes the delivery of the Project Protector fleet and it will be a substantial addition to the Navy. I might note that the programme has been bedevilled by delay and dispute largely because the Labour Government chose a one-off solution with the  
Canterbury 
 which has led to a very large repair bill. 
Todd McClay 
: What progress is being made with the rectification of the defects of the  
Canterbury 
? 
Hon Dr WAYNE MAPP 
: We have now settled the dispute over the defects of the  
Canterbury  
with BAE Systems by way of mediation. BAE Systems has paid $84.6 million to the Crown based on current exchange rates. I might note that Labour spent years talking about the problems but never actually got around to solving them. In contrast we had to initiate a legal process which has resulted in a very good outcome and it will enable a comprehensive rectification of the defects of the  
Canterbury 
. 
Education National Standards—Minister’s Understanding of asTTle 
8. 
Hon TREVOR MALLARD (Labour—Hutt South) 
 to the  
Minister of Education 
: Does she understand the asTTle reporting system and the process leading to it? 
Hon ANNE TOLLEY (Minister of Education) 
: 
 I would not claim to have an understanding on a par with that of Professor Hattie but I understand the core elements. 
Hon Trevor Mallard 
: What is the difference between the national standardisation used by asTTle and the standardisation required by her national standards? 
Hon ANNE TOLLEY 
: I am advised that asTTle is set to population norms. National standards are nationally consistent benchmarks that set clear expectations about achievement and progress and are aligned to ensure that students are on track to achieve National Certificate of Educational Achievement (NCEA) level 2. I am advised that in some cases the national standards expectations are above current norms. We have set these national standards at this level to ensure that all of our students are able to succeed at NCEA level 2. 
Hon Trevor Mallard 
: What is her best estimate of the extra time that teachers will spend and the cost of using a non-standardised system rather than one that is already standardised? 
Hon ANNE TOLLEY 
: I say to the member that that would very much depend on the assessment tools that teachers are currently using and the effectiveness of those. Many teachers in our schools are already using assessment tools and practices extremely effectively in which case for them very little will change. Perhaps all that might change is the additional requirement to report to parents against the national standards. But we know that there are many many students whose teachers are not using effective assessment techniques and tools and we hope that they will have to make many changes. 
Hon Trevor Mallard 
: In light of the Minister’s last answer for a teacher currently using asTTle—given that the Minister said that the cost would depend on the system that teachers currently used—what is the Minister’s best estimate of the extra time spent by the teacher and the extra cost to the school of using a non-standardised system rather than the already standardised asTTle system? 
Hon ANNE TOLLEY 
: It would depend on exactly what reports those teachers are currently giving parents. It is my understanding that there is not a standard asTTle report. But if teachers are using an asTTle report they will have to provide an additional report that includes placing results and the progress of students against the national standards. However if teachers are not producing an asTTle report for parents they will have to produce just a report showing progress against the national standards. 
Jo Goodhew 
: What advice has the Minister of Education received on the difference between asTTle norms and the benchmarks set by the national standards? 
Hon ANNE TOLLEY 
: I am advised that asTTle is based on population norms—that is what students are currently learning. We know—[ 
Interruption 
] 
Mr SPEAKER 
: I apologise to the Minister. The House showed courtesy while the Minister was answering a question from the Opposition; I now ask the House to show the same courtesy while the Minister is answering a question from a member of the Government. I think that that is only fair and reasonable. 
Hon ANNE TOLLEY 
: I am advised that asTTle is based on population norms—that is what students are currently learning. We know that in this modern world that is not significant enough for our students and the national standards have been aligned through to NCEA level 2. We know that that is the level that students need for success. 
Hon Trevor Mallard 
: Did I understand the Minister to just say that asTTle results are based on what students are currently learning; if not would she care to revise that answer? 
Hon ANNE TOLLEY 
: I am happy to add to that: learning and achieving. 
Hon Trevor Mallard 
: Does she accept that the asTTle reports for parents provide more more in-depth and more useful information to parents than her national standards will; if not why not? 
Hon ANNE TOLLEY 
: As I said to the member before my understanding is that there is not one standard report from asTTle. Some parents whose schools are using asTTle are getting very detailed information. But I know of one parent who has talked to me whose school uses asTTle and translates the asTTle reports into “average” “above average” or “below average”. So there is no standard asTTle report. What schools will have to do in addition to anything else that they are reporting to parents is to report progress against the national standards in plain language at least twice a year. We know that parents cannot wait for that to happen. 
Hon Trevor Mallard 
: Has she looked carefully at the asTTle graphs that are available for parents which most schools using asTTle give to parents; and does she accept that the information in those graphs provides more more in-depth and more useful information to parents than the reports that will be provided as a result of her national standards? 
Hon ANNE TOLLEY 
: Yes I have looked carefully at the console of reports. 
Passports—Roll-out of New Passports 
9. 
KANWALJIT SINGH BAKSHI (National) 
 to the  
Minister of Internal Affairs 
: What reports has he received on the roll-out of new passports? 
Hon NATHAN GUY (Minister of Internal Affairs) 
: 
 I have received reports from the Department of Internal Affairs on how successful the transition to new passports has been. The last old-style e-passport was issued yesterday. From today we are issuing the new model solely with new security features and a new black and silver design. Forty-five thousand of these passports have been issued and the new technology is working very well. All production targets were met during the transition to the new-style e-passport and they continue to be met. 
Kanwaljit Singh Bakshi 
: Why was it important to update the New Zealand passport? 
Hon NATHAN GUY 
: The New Zealand passport needs to be updated to keep up with technology and to stay ahead of fraudsters. The new passport has over 50 new security features. This helps to protect the good reputation that our passport enjoys overseas and indeed it secures visa-free access for New Zealanders to over 50 countries. What is more it is value for money; we have kept the price at the same level of $150 as previously. 
Housing—Salvation Army Report 
10. 
MOANA MACKEY (Labour) 
 to the  
Minister of Housing 
: What is he doing to address the housing issues raised in the Salvation Army’s recent  
State of the Nation Report 
? 
Hon MAURICE WILLIAMSON (Acting Minister of Housing) 
: 
 As the Prime Minister appointed me to the role of Acting Minister of Housing only at lunchtime I guess it will come as no surprise to the House to know that I have not as yet read the Salvation Army’s recent  
State of the Nation Report 
. 
Moana Mackey 
: What is he doing to address the urgent issue of homelessness in Auckland given that more than 20000 Aucklanders alone are now believed to be homeless? 
Hon MAURICE WILLIAMSON 
: I am still waiting on even initial briefing notes to come from my new department. Until I get those I am not doing anything. [ 
Interruption 
] 
Mr SPEAKER 
: I say to honourable members that I have called their colleague Moana Mackey. 
Moana Mackey 
: I am sure that would be a great comfort to the homeless of Auckland. [ 
Interruption 
] 
Mr SPEAKER 
: I ask the member to resume her seat. Members can see what happens when we do things that are out of order. It leads to disorder. I ask the member to please just ask her question and I ask her colleagues not to interject while she is doing it. 
Moana Mackey 
: Does he stand by his Government’s response to the report that changes to the Resource Management Act and the Building Act as well as the Auckland super-city will fix the homelessness problem or does he agree with David Zussman from the Monte Cecilia Housing Trust who said that that response lacks vision and leadership? 
Hon MAURICE WILLIAMSON 
: I think it will be no surprise to any member of the House that I stand by the Government’s reaction to the report. 
Moana Mackey 
: If the Resource Management Act and Building Act reforms are the answer to homelessness how soon will these homes be available given that 20000 people are homeless now and how many will be priced at an affordable level for someone who is homeless? 
Hon MAURICE WILLIAMSON 
: If I could just divert from my portfolio of housing to the building and construction portfolio for a second and say that only next week we will be launching in cooperation with the Housing New Zealand Corporation a new low-cost house design and a sample home. These things are already under way. 
Paralympic Committee Athletics World Championships 2011—Government Support 
11. 
MELISSA LEE (National) 
 to the  
Minister for Economic Development 
: What support will the Government provide for the 2011 International Paralympic Committee Athletics World Championships? 
Hon GERRY BROWNLEE (Minister for Economic Development) 
: 
 Last month I announced that the Government will contribute $400000 towards the 2011 IPC Athletics World Championships to be held in Christchurch in January 2011. The 2011 IPC Athletics World Championships are the world’s second-largest international sports event for athletes with a disability and they are expected to attract around 1300 athletes and 900 officials all coming from 75 countries. This is an elite international event and it is the first in a great sporting year for New Zealand. 
Melissa Lee 
: What is the expected legacy for New Zealand from hosting the 2011 IPC Athletics World Championships? 
Hon GERRY BROWNLEE 
: The event will leave a significant social legacy; namely the continued development of Paralympic sport in New Zealand. The event is a sporting showcase for elite athletes and it will highlight many role models not only for disabled but also for able-bodied individuals in New Zealand and around the world. In addition it is estimated that the potential economic impact for Christchurch will be over $12 million. As well as this media coverage of the championships is expected to be extensive. 
Chris Hipkins 
: Is funding available from the Ministry of Economic Development for other international events held in New Zealand that attract international media and television coverage such as the Rally of New Zealand? 
Hon GERRY BROWNLEE 
: On a case by case basis the member will be aware that the major events unit inside the Ministry of Economic Development considers support for events of that type. 
Chris Hipkins 
: Why did he decline an application from Motorsport New Zealand for support from the Major Events Development Fund for the Rally of New Zealand? 
Hon GERRY BROWNLEE 
: We set high criteria for the economic benefit that is to accrue from events like that. Of course I suspect that the sum requested for that event would have been somewhat higher than that granted to the Paralympians. 
Chris Hipkins 
: What steps will he take to ensure that New Zealand does not lose other significant events of a similar or larger scale to the 2011 IPC Athletics World Championships particularly in light of the recent loss of the Rally of New Zealand after he refused to back it? 
Hon GERRY BROWNLEE 
: I am surprised to learn that I am personally responsible for the loss of the Rally of New Zealand event. I will say we are trying to encourage a pipeline of events that will occur in New Zealand over a number of years where those events are to become annual biennial or whatever their frequency may be. We are also trying to encourage those events on an increasing basis to become self-sufficient. But we are very active in seeking opportunities for events that will give economic benefit and profile to New Zealand to be attracted to this country. 
Power Prices—Reduction 
12. 
CHARLES CHAUVEL (Labour) 
 to the  
Minister of Energy and Resources 
: What actions if any is he taking to reduce power prices? 
Hon GERRY BROWNLEE (Minister of Energy and Resources) 
: 
 I have often said that no Government can promise to lower power prices. Certainly the Labour Opposition cannot do so because under the Labour Government’s watch residential power prices increased by three times the rate of inflation. The aim of the Government’s electricity industry reforms is to flatten out the very steep price path that New Zealanders faced during those years. I would point out that since the National Government has been in office we have had a 1 percent price rise in real terms in the electricity sector. I hope that will continue through the coming year. It is significantly better than what was done by the previous administration. 
Charles Chauvel 
: Does he know that his own expert advisory group says that on average 227 megawatts per year in new generation were added under Labour between 2004 and 2009 and that only 174 megawatts per year are projected to be added between 2009 and 2014—not enough according to the Electricity Commission to keep the lights on past 2012? 
Hon GERRY BROWNLEE 
: Yes but I am also aware that those projections are somewhat determined by the ability of those proposing projects to get consent. I am confident that many of those seeking consents or considering seeking them are waiting for the Government to pass the next round of Resource Management Act legislation which we believe will make it much much more straightforward to gain consent. 
Jonathan Young 
: What is the Government doing to increase competition and constrain future electricity price increases? 
Hon GERRY BROWNLEE 
: The electricity bill that is currently at the select committee contains a suite of important changes to the electricity sector. The key initiatives that will beef up competition include the transfer of Tekapo A and Tekapo B power stations from Meridian Energy to Genesis Energy; requiring all major electricity generators to put in place an accessible electricity hedge market; allowing lines companies back into electricity retailing subject to strict controls; and establishing a $15 million fund over 3 years to promote customer switching for retailers. 
Charles Chauvel 
: Does he still say that it would be “audacious” for any power company to raise its prices while he was still considering changes to the electricity sector; if so what does he say to those New Zealanders now facing increased power bills while electricity companies ignore him and simply put up prices? 
Hon GERRY BROWNLEE 
: I spoke before of the measurable period of price rises under the National Government. In that time we had a 1 percent in real terms price rise. That is a third of the record for each and every year of the 9 years of the Labour Government. So I think it is a very proud record. What I would say is that last year most power companies appear to have made reasonable profits and they have done so while containing the price. I think that is the way we will see things happening in the future. 
Charles Chauvel 
: Has he seen comments from David Baldwin the Chief Executive of Contact Energy that “The outcome of the electricity review itself is of no particular concern to Contact.”; if so how does he expect to address issues within the electricity sector—in particular price rises—when one of the major players in the industry dismisses his reforms and increases its prices by 5 percent? 
Hon GERRY BROWNLEE 
: The reason that Mr Baldwin suggested that the Electricity Act changes were of no consequence or concern to Contact Energy is that it supports them and knows that it will be able to operate successfully within them. It is the most balanced electricity generating company in New Zealand and I welcome his comments. 
Charles Chauvel 
: Supplementary question. 
Mr SPEAKER 
: By my reckoning and from the advice I have received the Labour Party has now used its 28 supplementary questions and that is not counting the one where I gave the Hon Ruth Dyson the opportunity to repeat one of them—I did not count that one. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. I know that this is relatively unusual and I am doing something that I have never done before. I am almost certain that I used five supplementary questions. My colleague the whip counted my asking five supplementary questions which is what I was allocated. Your— 
Hon Bill English 
: Can’t count. 
Hon Trevor Mallard 
: That is the man who should have— 
Mr SPEAKER 
: The member will resume his seat immediately and that is the end of that point of order. 
Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill 
In Committee 
Debate resumed. 
Part 2 Consequential amendments to and revocations of other enactments ( 
continued 
)  
CARMEL SEPULONI (Labour) 
: 
 I will continue with my speech on Part 2 of the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. I was saying that Part 2 basically makes sure that there is consistency with regard to what is in Part 1. We were discussing the importance of student loans for particular groups in our society and the need to ensure moving forward that those groups have access to student loans because of the fact that unfortunately not every member of this society has parents who can afford to pay for their tertiary studies. We need to make sure that particular groups in society have equal opportunity to access quality tertiary educational opportunities. That is what we were touching on. 
Forgive me Mr Chairperson if I cannot do this but I want to check whether I can put something from Part 1 to the Minister. You are shaking your head; OK then I will not go there. 
We talked earlier about our own experiences with student loans at university and I talked about the fact that not only did I spend 11 years at the University of Auckland but I spent it working and studying there so I have had a lot of experience with Maori and Pacific students and also with students who are sole parents. We discussed the fact that for many of those students their time at university does not necessarily fit in the 3-year or 4-year degree time frame or whatever time their programme was meant to take. In fact I think that when I was at the University of Auckland there was some research done on the fact that quite often not just Maori and Pacific students but students in general struggled to finish their degrees within the time periods that were set. There are good reasons for that. I alluded to the fact that for some students the tertiary environment and the university environment in particular can be quite foreign given that some students come from families where they are the first to go on to study at a university. It is important that we take that into consideration. 
I heard one member from the other side of the Chamber in a speech about 2 years ago talk about his own experience at university. He went on to do a PhD but he said that it took him longer than 3 years to complete the initial BA. If he had taken out a student loan—even though I know that during his time he did not need to access a loan because in his day he was actually paid to attend university—then that would not have been a waste of money because that particular member although taking I think 5 years to complete a 3-year BA degree did go on to do a master’s degree and later a PhD. So moving forward we need to make sure that the Government does not narrow the criteria with regard to student loans and it needs to make sure that it does not limit access to the opportunities that tertiary education has to offer. 
When Labour was in Government for the previous 9 years it placed a concerted effort on making sure that it lifted the tertiary participation rate of particular groups—on making sure that it improved the numbers of Maori going through to higher level tertiary education and on doubling the number of Pacific people who were achieving bachelor degree qualifications. That is something that we on this side of the Chamber hope that the Government will continue to support. We hope that it continues to invest in tertiary education and continues to support the participation of groups that have been under-represented in higher-level tertiary education in the past. 
Unfortunately we have not seen any signals from the Government with regard to that. Not only has it slashed the important funding that went to adult and community education but it has refused over the last year and a half to lift the caps on the numbers of people being able to access universities and polytechnics at a time when we know that employment is scarce. So when there are all these young people—I think there is something like a 30.8 percent youth unemployment rate for Maori and a 29.8 percent youth unemployment rate for Pacific people—out there searching for opportunities to upskill and train this Government has shut things down for them. I think that is actually abhorrent. Not only do they not have opportunities for employment but also this Government is not supporting them with opportunities for going on to training or upskilling. At the end of the day that will be detrimental not only for those individuals but also for their communities. In the future in the long term it will be quite detrimental to this country because we know that future estimates of the demographics show us that down the track a large proportion of the population will be Maori and Pacific. Ageing Pakeha will be reliant on a young Maori and Pacific working base being able to support them. 
Those are just some of the issues that have come up in respect of this bill and of what the Government is proposing. It is not just the bill in front of us that concerns us; it is the wider discussions that are taking place. It is the public statements that the Prime Minister and the tertiary education Minister are out there making. Those statements are of concern for members on this side of the Chamber because we are concerned about heading down a track where the Government will make tertiary education less accessible for some groups—the groups for whom we have supported an increase in the numbers participating in tertiary education. We are very concerned that the Government will be basically cutting them off. 
Part 2 agreed to. 
Clauses 1 to 3 
Hon MARYAN STREET (Labour) 
: 
 I will speak to clauses 1 and 2 in particular. There are things I want to say about the fact that the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill is being progressed under urgency. I do not lay the blame for that at the door of the Minister in charge of the bill the Hon Peter Dunne. It is clear in clause 2 that the commencement date of some clauses is 1 April 2010 so it is important that the legislation is passed before that date. 
The House is sitting under urgency on Tuesday 23 February although it is actually 25 February outside this Chamber. Under urgency of course time stops on the day that urgency is accorded. The point about urgency is that it should be used sparingly for matters that really require it and for matters that are in fact urgent. There is time between now and 1 April to address this issue and to see this bill through to its conclusion but no the Government has chosen to put it through in urgency. This bill was presented to the House for the first time in August last year and the second time was in November last year. Now we are in the Committee stage of the bill at the end of February—under urgency. It is completely plain to everybody that it has simply been a subterfuge for the Government to excuse itself from at least one question time this week. So urgency was not essential and it has been applied. 
This is one of the few bills that has in clause 2 a reference to a date that I perfectly understand as being an essential date for the application particularly of taxation legislation—1 April 2010. But it could have been managed differently. That is not the fault of the Minister in charge of the bill but it is directly the fault of the Leader of the House who determines the agenda of the House at any one time. This is a sign again of a deal of incompetence that we have seen coming from the Government in even managing a simple bill which the Minister introduced to the House in perfectly good time. It was properly considered by the Education and Science Committee and was reported back in November of last year. Since then the Leader of the House has been unable to bring it through in a reasonable and measured way in time for it to be implemented by 1 April. This is a notice to all Ministers in Cabinet that they need to take the Leader of the House aside and say that they will not be made fools of in this way. They need to weigh up whether being protected from question time is worth being made fools of in terms of parliamentary procedure. Clause 2 the commencement clause is apposite and it is entirely reasonable to make some comment upon the progress and process surrounding this bill in this way. 
I want to talk about the title of the bill. When it is enacted it will be the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2009. It should perhaps be named the “Student Loan Scheme (Exemptions and Miscellaneous Provisions For Now) Amendment Act 2009.” It is not entirely clear whether this legislation will survive subsequent legislation that the Government may have in mind to narrow restrict shut down and make less accessible student loans and allowances. That is what we heard signalled by the Prime Minister in his Prime Minister’s statement at the beginning of this parliamentary year. It is what we have had underscored since then by the new Minister for Tertiary Education the Hon Steven Joyce. Steven Joyce is a man who does what he says he will do and he is a man who clearly has plans for his portfolios. 
Hon David Cunliffe 
: Except for telecommunications where he has no plans. 
Hon MARYAN STREET 
: With the now glaring exception my colleague reminds us of telecommunications and the roll-out of broadband. However let us assume that the Minister does have a plan for student loans and let us hope that this bill does not run foul of that. Let us hope that what endures after the Minister Steven Joyce has finished with student loans and allowances is access to those loans and allowances still extended to Tokelau still extended to the Cook Islands still extended to citizens of Niue and still extended to those who might one day live on the Ross Dependency—where in the meantime the penguins currently inhabit that part of the realm of New Zealand. Although it says it is a Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act I would suggest it is in fact an Act for now only. 
GRANT ROBERTSON (Labour—Wellington Central) 
: 
 I want to talk a little about the title clause of the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. We were advised earlier on by Louise Upston I think when she was speaking in the second reading that we were not focusing enough on the importance of some of the provisions in this bill. Putting some of them under the title “Miscellaneous Provisions” probably does not adequately reflect the importance of what we are doing here. In particular I think the clause that increases the deduction rate from 10c in the dollar to 15c in the dollar is potentially a very serious thing for the people who will end up having to pay that additional rate. I would not necessarily see that as a miscellaneous provision. 
I think it would be better for us to look at the reality of the bill and then work out what it should be called especially given the present environment which we have already discussed recently. Steven Joyce has come in as the Minister for Tertiary Education and we know that Mr Joyce has already told us that the support for the interest-free student loan scheme by the National Government is a political call. It has nothing to do with principle nothing to do with what National thinks is good for education in New Zealand and nothing to do with what it thinks is right for the economy of New Zealand in ensuring that our graduates stay here and contribute to the economy rather than go overseas—there is nothing about that. He said it was a straight-out political call. 
Therefore I think this bill could aptly be renamed the “Student Loan Scheme (Exemptions and Miscellaneous Provisions) Political Call Bill”. That is what is going on here. The National Party members do not want us to really focus on the fact that Steven Joyce has taken over the tertiary education portfolio with a clear instruction from John Key to look at it and look at tightening up the eligibility for student support. That is what Mr Key said in his Prime Minister’s statement to Parliament in early February this year. He said the Government would look at the issue of those people who spent too long in tertiary study and at whether there should be restrictions on their eligibility for student support. He said perhaps there would be something introduced around people having to pass their courses sufficiently quickly. 
On this side of the Chamber we are concerned about those potential developments. We see a bill in front of us now that makes some reasonably important but minor changes and they are useful. But at the same time we face a situation where the Government is hanging on to its belief in interest-free student loans only because it is a political call not because it thinks they are a good idea and they are delivering for New Zealand. Therefore I think the bill could easily be retitled in that way. 
Perhaps another title though that would pick up the overall essence of the Government’s policy around interest-free student loans would be the “Student Loan Scheme (Missing Bones) Bill”. This may be confusing for some people who have not been following the story so far. But when Labour introduced interest-free student loans in 2005 John Key was the finance spokesperson for the National Party and he stood in this Chamber and said the interest-free student loan policy that Labour was bringing in was ridiculous. He said it would be opposed by the National Party members with every bone in their bodies. Well here we are in 2010 and following on from the 2008 election when the political call that Steven Joyce mentioned was made we do not see much in the way of every bone being used. In fact the bones are missing. There is no attempt by National to turn this scheme round because politically it knows it cannot. But National is not committed to the scheme. In the long term we know that National would rather roll back the interest-free student loan scheme. The introduction of Steven Joyce as the Minister for Tertiary Education is a clear sign that National wants to get at interest-free student loans. It wants to restrict the number of people who can take out student loans and restrict the ability of people to take them out over a period of time. 
We believe that is a very dangerous path to go down. There is nothing more important as we come out of the recession than to have people increase their skills so that they can contribute to the economy. Earlier in the debate I mentioned the fact that the Australian Government responded to the recession by moving quickly to ensure that people who lost their jobs had access to training and tertiary study. It made sure that there were incentives for them to be able to do that so that they could contribute to the economy when Australia came out of recession. In New Zealand we saw none of that. We saw a continuation of the cap that sees tertiary institutions turning people away particularly at the polytechnic level where polytechnics face budget cuts from the National Government. Therefore we do not see New Zealanders being trained and upskilled to be able to contribute to the economy as we come out of the recession. That is a great shame. This bill and the activity of the National Government around tertiary education could be so much more than they are. We could be sitting here today to work out how to increase the skill level of New Zealanders but unfortunately we are not doing that. This bill is misnamed; it is actually about National wishing us to look elsewhere. 
MOANA MACKEY (Labour) 
: 
 I am happy to take a call on these clauses and I too have some suggestions for alternative names for this legislation. This legislation which Labour will be supporting is of course part of a much bigger picture around interest-free student loans. The title could be “Student Loan Scheme (I’m Glad the First Piece of Legislation We’ve Had Come to the House Isn’t Very Bad But I Worry About the Next Ones) Amendment Bill”. We know as my colleague Maryan Street has said that the interest-free student loan scheme is in trouble. We know that National does not like interest-free student loans because it rallied vociferously against them when the previous Labour Government introduced them. We were told that the interest-free loans were corrupt. In fact John Key said they were corrupt— 
Lynne Pillay 
: “Irresponsible”. 
MOANA MACKEY 
: —“irresponsible”. They were a bribe says the man who I bet never had a student loan. That brings me to my second suggestion for a title: “Student Loan Scheme (Why Don’t You Actually Ask Students Who Have a Loan About What It’s Like to Have a Student Loan) Amendment Bill”. One of the things that concern me is that even in this debate we have been lectured at length by people from the Government who have never had a student loan. I have had a student loan. I had it at the worst time to have a student loan in the 1990s. I had it when I was paying interest while I was studying. It was daily compounding interest. I was working 20 hours a week. I say to Government members that if they are concerned about people who are failing their courses look at how many hours that students have to work to support themselves which should be hours spent studying but they are working long hours to support themselves. I worked 20 hours a week while I was at university and it was to the detriment of my studies. I did not fail but I could have done an awful lot better if I had been able to focus solely on my studies and not have to worry about how the rent would be paid or how we would be able to afford to pay the power bill that week. 
The title “Student Loan Scheme (Why Don’t You Actually Ask Students Who Have a Loan About What’s It’s Like to Have a Student Loan) Amendment Bill” might be a good way to go. We have heard some pretty patronising speeches about how I should just be grateful that I had a student loan. Well I was not grateful for it. I was grateful that I got to go to university but I was not grateful for the fact that I worked 20 hours a week to keep my loan down. I was at university for 4 years and I left university with a loan of about $15000 or $16000. By the time I had graduated the loan was already into the $20000s and I had not even started working yet. I was not grateful for that aspect of the student loan scheme. 
I notice that all the members opposite who are chipping away had free university education and I ask them again why they do not actually talk to people who went through the scheme. If members do not understand the incentives around repayment then how can they put that into place in the policy? If they do not understand what it is like to have a student loan what it is like to think that one will never pay it off— 
Hon Georgina te Heuheu 
: She thinks that some of us have never had offspring with student loans. Some of us have. 
MOANA MACKEY 
: I say to Minister Te Heuheu that people can think they will never be able to pay it off because when they graduate the 10 percent that comes out of their income automatically is actually less than the interest for that period so they are repaying their loan and it is going up and up. So people think they will never be able to repay it. Those members opposite who have never had that experience should talk to people who have and they will tell them what they need to do— 
Hon Paula Bennett 
: Get the facts. 
MOANA MACKEY 
: Paula Bennett who had the training incentive allowance to help her get off the domestic purposes benefit and then cut it for every other domestic purposes benefit mother who wanted to get off the benefit should probably— 
Hon Paula Bennett 
: Look at the facts. 
MOANA MACKEY 
: How did the Minister get to university? 
Hon Paula Bennett 
: I had a student loan actually. 
MOANA MACKEY 
: How did the Minister get a student loan to go to university? That Minister cut the tertiary training incentive allowance to every other domestic purposes benefit mother who wanted to get off the benefit. She pulled the ladder up behind her after that scheme helped her to get off the domestic purposes benefit. Good on her for doing that but I think it is mildly repugnant when the scheme that that Minister benefited from was cut so that no other domestic purposes benefit mother could climb that same ladder. 
But I come back to the bill and suggest the title “Student Loan Scheme (Save Our Interest-free Student Loan) Amendment Bill”. The interest-free student loan scheme is at risk. We can see from the reaction of those on the other side how much they do not like having to listen to us explain about the value of the interest-free student loan scheme. I am proud about Labour’s record in this area. I am proud that the first thing we did when we became the Government was to remove the interest from loans while students were studying because that was horribly unfair. 
LYNNE PILLAY (Labour) 
: 
 I start my speech by congratulating Moana Mackey. It is really good to hear from a relatively young person and I must say that Moana Mackey is celebrating a birthday very soon. Moana Mackey is very aware of the costs of being a student and the advantages of what happened with the interest-free student loan scheme. The introduction of interest-free loans was one of the proudest moments in Labour’s term in office. Students were absolutely delighted at having some hope of cutting into the principal of the debt they had incurred while they were studying. 
As other speakers have said—and I say it again—the previous Labour Government’s interest-free loan scheme was labelled by then National Opposition as “irresponsible” as “buying votes” and all sorts of other things. National members were absolutely opposed to it. They said it was the worst thing that the Government could ever do. So I guess the name of this bill could be the “Student Loan Scheme (We Didn’t Actually Get Rid of the Interest Free Student Loan Scheme: We Will Make Some Technical Amendments; There Are Other Ways to Fleece Students in This Country) Amendment Bill” 
What would those other ways be? I see Paul Quinn wondering what they could be. Certainly it would be the ability of students in this environment to pay back their loans. The reality for most students is that they study during the year. They have part-time jobs so they do not have to take on so much of a loan. Maybe they work during their holiday period so they are able to pay off some of the principal of their loan. Well that cannot happen under this Government. Has this Government done anything to assist in providing jobs and opportunities? Has it done anything to assist our industries to get through these tough times? No it has not; it has done quite the opposite. Again students are on the wrong side of that but they will go out and look for jobs. 
I know that many members opposite denigrate students but we know that students work very hard. They work hard in their studies and then they try to secure employment to assist them during their study time so they can get rid of some of the principal on their loan. I have spoken to so many students who have said that it just is not possible to get jobs despite the Minister standing in the Chamber and talking about all the opportunities that the Government will give young people. We know in the substance of it that there no jobs or opportunities out there. 
This bill is technical but we also look at what else is on the Government’s agenda. This bill does no harm to students but what could be on the agenda for students in the future? We know there is a veiled threat because we heard the Prime Minister talk about lifting the cap on fees’ institutions. So what do we know will happen? When Labour was in Government we took some very responsible moves which were not supported by the National Opposition at the time to ensure that student fees did not escalate way out of control as they had done under the previous National Government. 
Mr Key has referred to an “inflexible and bureaucratic funding and policy framework”. What does that mean? It means a framework that ensures that student costs do not romp away—that there is a cap on the fees that institutions are able to pay. So Mr Key’s comment tells me that tertiary education will soon move into the National Government’s market approach to things. 
Hon PETER DUNNE (Minister of Revenue) 
: 
 Yesterday I was listening to a discussion about language on that great national icon Radio New Zealand. It was stated that the great American writer Mark Twain was known for his precision in language. He was very critical of adverbs and adjectives and he wrote in short sentences. Members may be wondering what the relevance of this discussion is to the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. I have been here for a little while avidly listening to some very strong arguments being advanced from members on the other side of the Committee about how the bill could be retitled. I have mulled over in my mind some suggestions from various members. I say to Moana Mackey that she fails the Mark Twain test. Her suggested amendments were far too long. 
Hon Maryan Street 
: I passed. 
Hon PETER DUNNE 
: I will come to Maryan Street in a minute. Lynne Pillay’s amendment seemed to never end. The problem I have in trying to apply the Mark Twain test to this is— 
Hon Trevor Mallard 
: That’s why they couldn’t circumcise Muldoon isn’t it? 
Hon PETER DUNNE 
: I do not know what he had to do with Mark Twain but that may be another story. 
The point I am making is that this bill’s title is an accurate description of what the bill contains. It might not be the most exciting title but it is certainly the most accurate and it passes the Mark Twain test. That is why having heard the arguments put forward from members opposite I am not persuaded that a change is in order. 
I heard the Hon Maryan Street make reference to the timing of this bill in the context of the current urgency. I was grateful for her that I was excluded from her excoriating criticism. However I am concerned that this bill be passed as soon as possible and I will tell members why. In one of the earlier parts of this bill we passed some very important provisions relating to students being able to study overseas and access a student loan. Members will be aware that that provision is backdated to 2007. A lot of students have been waiting for this provision to pass because they will now be able to access it and they have been uneasy—I know this from the correspondence I have received from many of them and in particular from their parents—at the uncertainty that has prevailed. 
I am very keen to see the bill passed. I would have loved to see it passed last year but other circumstances got in the way. I am very pleased that it now will pass and those people will get the benefit. From the bottom of my heart I thank those members of the Opposition who have taken such a constructive interest in the grammar and construction of the title. I have listened to what they have said but I think on balance the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill captures it all really. 
CARMEL SEPULONI (Labour) 
: 
 I have some ideas for what we could rename the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill but I will get on to that shortly. I refer to something that Moana Mackey talked about. She said that while she was studying during the 1990s even though she was not working full time—she was studying part time—every time she got that statement from the Inland Revenue Department she saw that interest had been added on to her student loan. That is something that I saw that Grant Robertson saw and that a number of us saw. 
We were very thankful when the Labour Government introduced interest-free student loans in 2005 despite opposition from the National Party at that time. National thought that it was corrupt and irresponsible of the Labour Government— 
Chris Hipkins 
: A hoax they called it. 
CARMEL SEPULONI 
: National called it a hoax and thought it was irresponsible of the Labour Government to bring in a provision that ensured all New Zealanders had the opportunity to have equal access to tertiary education. We know that one of the biggest barriers to participation in tertiary education is the finances. As a person who went through tertiary study during the very very bad 1990s all I can say is that I appreciated the fact that in 2005 student loans were made interest free. 
Across the course of this debate we have had a few interjections and comments from the floor. I want to clarify something for Mr Garrett who interjected earlier and asked whether I had even graduated. That is typical of the attitude from Mr Garrett. I will clarify for him that yes I did graduate. I graduated three different times with three different qualifications so I thank him very much for that query. 
If we look at the title of the bill we see it is the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. I think that when thinking of different titles for this bill we need to look at the broader picture with regard to the public comments that have been made by National members of Parliament including the Prime Minister and some of the actions that National has taken on tertiary education during its term in Government. One possible alternative title for the bill could be the “Student Loan Scheme (Does Not Really Make Up for Paula Bennett’s Training Incentive Allowance Cuts But Anyway) Amendment Bill”. That goes back to what I was saying before with regard to some of the actions that have been taken with tertiary education and the fact that the National Government does not take seriously the need for a range of different people particularly those who are marginalised or underrepresented in tertiary education to have equal access to tertiary education. 
Another possible title I think we could add to the mix might be the “Student Loan Scheme (We Will Tutu With It Now But Make the Drastic Changes Later) Amendment Bill” because that is basically what the Prime Minister and the Minister for Tertiary Education have indicated to the public they will be doing by their recent comments that they will be taking a serious look at the student loan scheme. The Prime Minister has alluded to the fact that some students have taken advantage of the scheme or he believes that they have been mucking around and not taking it seriously. All of those things indicate that down the track National will be looking to make drastic changes. 
As has been mentioned in this Chamber today the ones who will be affected by the changes that we anticipate the Government will make down the track are those from lower-income families Maori and Pasifika and also as I mentioned before women. Already we have received a number of letters and emails from women stating that it would be very difficult for them to study this year knowing that the training incentive allowance will not be available for them. The Minister for Social Development and Employment said that she would put in a provision so that they could have an extra $500 on their student loan but for a student $500 on a student loan is nothing compared with the $3800 that was cut from the training incentive allowance. That money was a cut for women who are looking after children by themselves and who are already struggling with things like childcare and even transport with regard to getting to their tertiary institution. Many of them have come out of sometimes tumultuous relationships and we have this Minister for Social Development and Employment deciding to cut something from them. 
CHRIS HIPKINS (Labour—Rimutaka) 
: 
 I will take a very brief call; this time I will be reasonably brief on this final point. We are debating the title and commencement clause of the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. I do not intend to suggest a whole raft of alternative titles to the bill as some of my colleagues have. However I acknowledge the contribution of the Minister in the chair the Hon Peter Dunne in this debate. I have been in the Chamber for most of the Committee stage on this bill as I know the Minister of Revenue has been although a little earlier in the day than we might have initially anticipated. I thank him for engaging with the debate. We on this side of the Chamber are not used to having the opportunity to put questions to a Minister in the Committee stage and have the Minister stand up answer them and engage in that kind of interaction. That is what the Committee stage of a debate should be all about; I can see the Chair is agreeing with me on that. It is unusual but it is very welcome. 
I think the Minister has answered a number of the questions we put forward. I put forward questions to him earlier on about diplomats and about the thresholds. He has engaged with us on those issues and I think that provides some reassurance to people who are listening in on this debate that even though this bill does not necessarily address all of the issues or the technical concerns that exist with the current interest-free student loans scheme the Government has at least taken on board some of those issues. I was also very pleased to hear the Minister acknowledge the concern around diplomats and he gave us a commitment that he would look further into that issue. I am more than happy to talk to him about that issue further at any point if he wishes to do so. I am happy to give him some examples of people who have been captured by that particular problem. 
That was all I wanted to say on this particular part of the bill. I just wanted to acknowledge the contribution the Minister has made and to thank him for it. 
CATHERINE DELAHUNTY (Green) 
: 
 Tena koe Mr Chair. I will take a very short call. I would like to start by saying that urgency does not always bring out the best in us. It sometimes leads to flogging a dead horse or working out just how many ways one can say the same thing as someone else without using or stealing his or her precise words. I do not want to do that. But I would like to disagree with the Minister of Revenue about the title of the bill. I feel that the title although it has a certain musical ring is somewhat disingenuous. 
“Miscellaneous” is a beautiful word. It is a marvellous colourful word but it suggests very very small random issues and it is not accurate in terms of the way the Green Party sees this bill. I have also learnt in my brief time in this Chamber that we take on words like “miscellaneous” at face value at our peril. In this place it is essential to read the fine print and not only to read the fine print but also to get 12 other people to read it and then consult widely and exhaustively and extremely—as a result of urgency—with at least the groups who are most affected by the bill and then after all of that assume the worst. 
I like Mark Twain’s idea of brevity and I would like to suggest some brief titles that would satisfy the Green Party. One is “Give With One Hand Punish with the Other”; the other is “Fifteen Cents in the Dollar or Else”. Kia ora. 
Hon Sir ROGER DOUGLAS (ACT) 
: 
 The Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill is a relatively— 
Hon Member 
: Was it a good book? 
Hon Sir ROGER DOUGLAS 
: Do not get me sidetracked! This bill is a relatively simple one. I think it is fair to say that the title of the bill reflects the purpose and intent of the bill. I think it is time that members stop wasting the time of this House. 
A party vote was called for on the question  
That clause 1 be agreed to. 
Ayes 113 
New Zealand National 58; New Zealand Labour 43; ACT New Zealand 5; Maori Party 5; Progressive 1; United Future 1. 
Noes 9 
Green Party 9. 
Clause 1 agreed to. 
A party vote was called for on the question  
That clause 2 be agreed to. 
Ayes 113 
New Zealand National 58; New Zealand Labour 43; ACT New Zealand 5; Maori Party 5; Progressive 1; United Future 1. 
Noes 9 
Green Party 9. 
Clause 2 agreed to. 
A party vote was called for on the question  
That clause 3 be agreed to. 
Ayes 113 
New Zealand National 58; New Zealand Labour 43; ACT New Zealand 5; Maori Party 5; Progressive 1; United Future 1. 
Noes 9 
Green Party 9. 
Clause 3 agreed to. 
Bill reported without amendment. 
Report adopted. 
Third Reading 
Hon PETER DUNNE (Minister of Revenue) 
: 
 I move  
That the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill be now read a third time 
. This bill includes a suite of mainly technical changes to the student loan repayment rules to ensure that the law is clear and consistent and that it operates as intended. The bill also extends interest-free loans to borrowers from Niue the Cook Islands and Tokelau which share a special relationship with us as part of the realm of New Zealand. As the Ross Dependency is also part of the realm of New Zealand people who go there will also be eligible for an interest-free loan. There was some debate in the Committee stage about how many people would actually go to the Ross Dependency and be eligible for a loan and whether we would be in fact producing a nation of well-educated penguins. The reality is that there will be some people on scientific exchange who will benefit from this provision. Although they will not be great in number I suspect that their contribution to New Zealand in future years will be great in substance. 
These borrowers will have to comply with the same requirement to be in one of those countries for 183 days in the same way as New Zealand borrowers so that borrowers from a realm country have an incentive to return home after their study and to make a positive contribution towards their country’s future. That provision is probably of greater impact with regard to Niue the Cook Islands and Tokelau than the Ross Dependency but the same point applies nonetheless. 
The bill also extends interest-free loans to include students who choose to further their education overseas through full-time study under formal exchange programmes or formal agreements between New Zealand and overseas tertiary education providers. There is some anomaly in this area at the moment and this change will be of considerable benefit to a number of New Zealand students particularly as they go further through their studies. 
The bill also includes a number of small refinements that provide greater clarity to borrowers. They were added at the select committee consideration. The first of those changes defines the term “overseas tertiary provider” so that it is clear what type of overseas organisation borrowers must be engaged in full-time study with in order to qualify for interest-free loan status. That will immediately deal with some concerns there might be about the bona fides of some of the organisations and institutions that people are enrolled with. The other change extends the overseas exemption to include those who are engaged in full-time postgraduate study overseas if their studies cannot be completed in New Zealand. When we talk about having a highly skilled nation and upskilling the intellectual capacity of our public that ability to go overseas to complete postgraduate study when it is not available in New Zealand is particularly important. The purpose of these measures is to recognise the value that students who pursue further training and study overseas bring to New Zealand as well as encouraging them to take up the opportunities to do so. 
The remaining changes that the bill introduces are largely technical or remedial in nature. They include an amendment to correct an unintended change to the hardship relief provisions that was made by the Student Loan Scheme Amendment Act 2007 a change that allows the Inland Revenue Department to raise the compulsory repayment deduction rate from 10 percent to 15 percent to help ensure that borrowers pay their correct loan repayment amounts and the removal of a technical problem so that borrowers who return to New Zealand and wish to fully repay their loans before they have met the 183-day requirement to qualify for an interest-free loan can now do so. 
There was some debate during the Committee stage about the adequacy of its title. A number of suggestions were made by members particularly from the Opposition side of the House to greatly extend the title of the bill to maybe more accurately in their minds reflect some of its provisions. But on balance and I am sure the House will concur with me having heard what this bill is about it was decided that the title Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill was in fact a more accurate if less colourful description of the bill’s title. 
As the bill comes to its third reading I acknowledge all of those who have contributed to its successful passage thus far. In particular I acknowledge the policy officials from the Inland Revenue Department and our drafter for their work on the details of the bill. I acknowledge those who made submissions to the Education and Science Committee and others who made submissions aimed at improving the practical application of the measures. I want to record my thanks to the select committee for the detailed consideration that it gave the bill and for its recommendations which have given greater clarity to the legislation. I also thank those who participated in what was I think a good-natured and constructive debate. 
As the bill now stands the measures that are contained in it will help to ensure that the student loan scheme works in the way that it should for both borrowers and the Crown. That has to be important given that the opportunities the student loan scheme provides to so many students have to be matched by the Crown’s responsibility to manage what is now a multibillion-dollar asset in terms of outstanding loan liabilities. It is a balanced process. I think that it has been widely accepted by the House and with that I have great pleasure in commending the bill to the House for its third reading. 
Hon MARYAN STREET (Labour) 
: 
 I rise to support this legislation which was introduced by the Minister of Revenue who has just resumed his seat. At its third reading I have to say that I have been feeling sorry for the Minister. This Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill should have been reasonably pedestrian legislation to usher through the House. It had the support of the Labour Party and the only dissenting voice was from the Green Party for the reasons that its members have described earlier in this debate. This legislation has been loaded into urgency for no good reason. It could have been dealt with in December; the report of the Education and Science Committee was presented to the House on 27 November and if I remember correctly we sat quite late in December. It could have been dealt with in the ordinary scheme of things with sufficient attention being paid to it allowing it to be in force by 1 April which is one of the critical dates. 
However for the reasons that we have described previously in this debate the Government has seen fit to cover its own sins and inadequacies by putting this bill into an urgency motion that was sought predominantly to avoid question time and to thereby protect weakened ill-performing Ministers from the democratic scrutiny that occurs at 2 o’clock every day of parliamentary sittings. On top of that I have been feeling sorry for the Minister about this because—[ 
Interruption 
] Members opposite might not have noticed but we did not have question time yesterday. Because of the sting that the Government received from that in the media it decided to give in today. But more important I have been feeling sorry for the Minister in his presentation of something that should have been reasonably pedestrian legislation because since the select committee reported back on the bill to the House we have had an explosion of antagonism towards students by the Government. Now this Minister has to front a perfectly good bill in the context of several depth charges that have been dropped into the tertiary education arena by this Government. Let me cite three. 
First of all there was the Prime Minister’s statement at the beginning of this year in which he said that the Government will take a careful look at the policy settings with regard to student support. Of course that left everybody wondering what it meant. Does it mean that the Government intends to restrict access to tertiary institutions by not making them open entry for people over the age of 20? I will come back to that one in a moment. Does it mean that the Government is intending to make loans and allowances harder to access? I will come back to that one in a moment too. The Government unleashed that set of imponderables to begin with upon this Minister and upon a perfectly ordinary piece of legislation. I say that without meaning to be dismissive of it at all I tell the Minister. Secondly the Minister for Tertiary Education was removed from that portfolio; Anne Tolley was taken out of that portfolio and replaced by Steven Joyce. Steven Joyce went on to say just last weekend in the Christchurch  
Press 
 newspaper that the student loans policy was in his sights. What are we meant to take from that? I ask whether we are to assume that he is also inclined to make student loans harder to get thereby limiting access to our tertiary institutions and limiting people’s ability to take up educational opportunities and reducing the cost of tertiary education to the Crown. We on this side of the House say that the cost is justified and that investment ought to be made by the Government and increased in line with other comparable nations as a way of promoting economic growth and development and as a way of securing our future. 
On top of that the Government decided to support at its first reading the voluntary student membership bill which was drawn out of the ballot and is Sir Roger Douglas’ member’s bill. That was an antagonistic gesture as well. The Government will not say whether it will support that bill at its second reading. It will support the bill at its first reading but it could have stymied it in its tracks as it has done with other bills that have been drawn out of the ballot and not been given the privilege of being referred to a select committee. This Minister now has to field a bill in that context. Perhaps people are wondering why we have been getting so agitated about a bill that would not normally cause this much fuss. It is because it is being dropped into an environment that is now explosive for students. Students around the country have launched a website in response to the voluntary student membership bill. It is called Save our Services and they are getting support in the process. 
I will say a couple of other things particularly about whether this Government intends to make it harder to access student loans—access that this bill expands. If that is the case then let it say so. If it is the case that the Government wants to make it harder by virtue of ramping up the NCEA qualifications required to get into university then that is one issue. If it wants to make it harder to access student loans by ramping up the requirements to pass while at university wananga or polytech then that is another issue. But let us be very clear that whichever way the Government goes about it there will be people who will miss out. I will cite two examples of people who accessed education after the age of 20 or who accessed education not in the usual way of progressing from school and I will demonstrate how important access to education is. 
The first example is the chief executive officer of the Universal College of Learning Paul McElroy who is now in the position of having to turn students away because this Government will not renegotiate the student caps and it will not invest in additional student places in order to equip our country adequately for the future. That breaks his heart because of his own background. He said that he knows firsthand about second-chance education because as a teenager he ran away from home without university entry qualifications. His life was transformed when Wellington Polytechnic took a chance on him. It took a chance on him. He did not come in through having UE or any kind of entry qualification but the polytechnic in Wellington at that time took a chance on him and it changed his life. If this Government is proposing that National Certificate of Educational Achievement (NCEA) qualifications be made more difficult or that the threshold be raised so it is more difficult for people to enter tertiary education then members should look at Mr McElroy who has now gone on to be the chief executive officer of a polytechnic. 
The second person I will cite is somebody who came to New Zealand at the age of 23 years as a young mother. In fact she needed to do something to improve herself and her prospects. She enrolled in education at Massey University and in her first year she passed all her courses. It took her 4 years to complete her BA and she was awarded a Massey scholarship as a top graduate in psychology. Later after a series of courses and scholarships having benefited from open entry after 20 years of age she graduated with her PhD. The rest is a matter of public record: a lectureship at Massey University a promotion a move to Canterbury University 6 years as a member of Parliament and now 8 years of running her own research company. That person is of course Liz Gordon. Those are examples of people who have contributed to this country by virtue of accessing tertiary education. If this Government wishes to inhibit that— 
Mr DEPUTY SPEAKER 
: I am sorry but the member’s time has expired. 
COLIN KING (National—Kaikoura) 
: 
 It is a pleasure to speak on the third reading of the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. It is very easy to look at the student loan situation in isolation. From listening to Opposition members one would imagine that it was an enormous part of the overall context of things. I think that during this third reading it would be appropriate to give the wider context of the student loan situation as it relates to exemptions and miscellaneous provisions. 
The scheme’s nominal value is $10.3 billion. According to the last financial report the basic value of the student loan scheme is $6.5 billion. If members look at the situation in 1994 when the student loan scheme was put in place they will see that only 252000 people were accessing tertiary education loans. Today that number is approaching half a million. Even though collectively we might have our varying views on the scheme this country has gone from having one of the very lowest rates of entry into tertiary study to having one of the very highest. That is laudable and applaudable. I say that is well done. 
This bill in its context recognises the fact that education is portable and valuable but we do not want to forget that the taxpayer is still picking up 70 percent of the cost of tertiary education. Half a million people have student loans. The desire of the bill is make sure that the student loan scheme functions as it is intended to. 
Principally the bill refines the process for two particular groups. Those two particular groups have been spoken about regularly in the House this afternoon. One group is those countries that are included in the Realm of New Zealand—principally Niue the Cook Islands Tokelau and the Ross Dependency. The second group is affected by an anomaly that the Minister of Revenue has brought to the House for speedy remedy. It relates to people who have gone on to an institution overseas to undertake a course of study above level 7 that is not available in New Zealand. 
I will not go on too much further. I think matters have been well and truly canvassed. This bill will greatly aid the running of the student loan scheme and I am sure that the Minister will feel more comfortable when it is passed in a speedy and responsible way. From that point of view it gives me great pleasure to commend this bill to the House. 
KELVIN DAVIS (Labour) 
: 
 The Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill amends the Student Loan Scheme Act 1992 by extending interest-free loans to borrowers who are present in Niue the Cook Islands Tokelau or the Ross Dependency for 183 or more consecutive days in order to encourage borrowers from those countries or that territory to return to their country and contribute to its development. It also covers students who enrol with a New Zealand education provider and engage in full-time study overseas under either a formal exchange programme approved by the New Zealand Government or a formal agreement between a New Zealand tertiary provider and an overseas tertiary provider. The bill also makes eight minor or technical amendments to the principal Act. 
As has been mentioned numerous times this is largely a technical bill but that does not diminish its significance for those whom it affects. They are the students who have taken up interest-free student loans in order to support their decision to better themselves personally and professionally. It is a big call to choose to study. It involves time money and opportunity costs. I say make no bones about it the decision to study is the right decision for many young and old New Zealanders to make and New Zealand benefits through having an educated highly skilled workforce. That is why I say the interest-free student loan programme is one of the most progressive pieces of economic development legislation passed in this House. It helps to drive New Zealand’s economic development. An educated workforce is imperative in this day and age as we will never compete—nor do we want to—with low-wage economies. That is why I am astounded that the National Government is making noises about cutting the scheme. How will the 75 percent of people who earn under $40000 per year be able to afford to send their children to university and polytech when they can barely afford to pay their power bills? They cannot and that is why access to the funds those students need in order to further themselves is so important. In fact it is vital. Education needs to be accessible to all Kiwis who wish to access it. 
Why did the Prime Minister say recently he would take a careful look at the policy settings around student support? Why did Louise Upston in her second reading speech spend a few minutes telling members about how expensive the student loan scheme is for New Zealand taxpayers? Society bears this cost in the knowledge that the benefits to the country and to communities far outweigh those costs. Why did Amy Adams stand up to talk about the tax debt relating to student loans? I will tell the House why. It is because National is priming the public for the removal of interest-free student loans. Steven Joyce has told the  
Weekend Press 
 that the student loan policy is in his sights. The Government’s intention is clearly to make it more difficult for tertiary students to get a loan to cover their fees in the first place. 
If the Government starts to pick winners in the tertiary education system before people enrol then those who have not done well at school for a variety of reasons and who want to have a second chance at learning should beware. I have a friend who is a doctor and she said that when Labour introduced the interest-free student loan legislation it removed a weight from around her neck as she was struggling to pay even the interest on her loan and was beginning to conclude that a move offshore was the only way to kill off her debt. She is now working at Wellington Regional Hospital and she sees light at the end of the tunnel. 
I will go back to the Prime Minister’s comments about taking a careful look at the policy settings around student support. What does he mean? The Government will make access to student loans and allowances more difficult. I suspect it will make tertiary education opportunities in universities and polytechs available for the few not the many. Once again legislating for the few at the expense of the many is simply not fair and it takes away the aspirations that Labour works to foster in our communities. The Prime Minister referred to students who do not take their studies seriously or who do not get a job quickly after qualifying. Who will determine which students those ones are especially when there are students who go to a university or polytech and then find that the first course of study that they take is not exactly what they want? They can find that out only by going to university in the first place. As I said earlier on in the day my brother was one of those students. He initially took business studies when he went to Waikato University only to find that was not right for him. He then went on to get a BA in Maori then after that he decided that a degree in law was what he after. He is now a very successful lawyer up north. 
Will student support stop after students graduate with a degree preventing them from choosing to do postgraduate study? What about the students who need more support to succeed because they have started further back from the starting line than others? I refer to many Maori students whom I have seen go through the schools I have been involved with who take time who do not succeed to the same extent initially as many other students but who have the ability to go on to university. The problem is just that they start from a little further back than other students especially financially. Most of the family and friends I know from up north are not financially well off so it is a lot harder for young people to make the decision to head off to university knowing that that will be a big strain on their family and on finances. A number of those family members and friends who go to university do really well in the first year but they find that the financial struggle for their families is too much to bear and many tend to drop out. That is supported by the research of the Starpath project based at the University of Auckland. We all know students who work at their studies and at part-time paid work often for low wages and who struggle to make ends meet. Setting out criteria for discontinuing student loans or allowances is dangerous and elitist territory. Again I say it is about providing more of the same for the few at the expense of the many. 
John Key is threatening students who put up with a low income now so they can study and contribute to the country’s well-being in the future. Right now it looks as though he will punish them for doing that but first he will hit them with a higher rate of GST just to make things even harder. What will happen if there are not enough jobs for graduates to go into? What about the redundant workers who want to enrol in courses in order to improve their skills and who need allowances and loans to do that? What about students with disabilities who find it difficult to get employment so continue to study in order to improve their quality of life? Over 45000 Kiwi 15 to 19-year-olds are now unemployed; that is over 12000 more than for the same period a year ago. That number increases to over 72000 Kiwis once we include those aged 20 to 24. The danger now is that many of these young people will stay jobless for a long period of time as the National Government takes away the opportunity for them to aspire to better themselves. 
There is also the veiled threat of lifting the cap on the fees that institutions can charge students contained in Mr Key’s reference to “an inflexible and bureaucratic funding and policy framework”. It looks as though tertiary education will soon become the sole domain of the rich but New Zealand’s crying need is for the upskilling of the many not the few. If Mr Key wants to see a step change in the New Zealand economy where does he think it will come from if not from post-compulsory education and training? He should be nurturing and investing in it not threatening it. 
The fact is that National in its short time in office has already proven it is no supporter of students. Here are just two examples of that. Firstly the Institutes of Technology and Polytechnics of New Zealand revealed that about 6000 aspiring students could be turned away from polytechnics as a result of the Government’s refusal to waive financial penalties if polytechs exceed their enrolment caps. This is another short-sighted decision by the Government which clearly prefers to see people being stuck on the dole rather than engaged in the study and training required to ensure we emerge from the recession with a work-ready and productive workforce. Secondly the Government has passed legislation that reduced the number of seats on polytech councils from a maximum of 20 to just eight. The legislation allows the Minister to appoint nominees to half the council positions. Requirements that Maori staff students and the community must have a representative on polytech councils have been cut. This will enable the Government to take a much more dominant role and disappointingly will remove the existing provisions for almost all student community and academic staff representatives to sit on the councils. 
CATHERINE DELAHUNTY (Green) 
: 
 Tena koutou katoa. The Green Party will be voting against the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. As the only party opposing it at the third reading I think it is important that we try to explain to others the reasons rationale and analysis behind that decision. 
Firstly I acknowledge what Kelvin Davis just said about unintended consequences although he did not refer to it like that; he talked about recent education bills. The Education (Polytechnics) Amendment Bill is a good example. We were lobbied only yesterday by the New Zealand Union of Students’ Associations about the consequences of that bill in terms of reducing the number of students who anecdotally are not getting elected to the new polytech councils. Obviously the jury is still out and the elections are not all over but already we can see the effects of that bill and that more and more students are reporting back to that organisation that their campuses have no students on their councils. That is why we take a very precautionary view on any legislation that impacts on students because we believe that we must take the big picture into account. 
We are voting against this bill because of our consistent belief that despite the positive technical tinkering in parts of the bill and the good intentions within the narrow definitions of the bill the original student loan scheme itself remains one of the most oppressive pieces of legislation in the history of this House. It cannot compete with some of the mean-spirited colonising laws from our history such as the Maori Prisoners Act or the Tohunga Suppression Act but elements of this bill fit well with the retrogressive punitive pieces of law that have been selected recently from the ballot such as the Minimum Wage (Mitigation of Youth Unemployment) Amendment Bill and the Education (Freedom of Association) Amendment Bill. We are talking about punishing people who are already in debt. 
The student loan scheme was designed to make education a commodity and individuals responsible for the costs. Now the country has a $10 billion student debt which is absolutely no surprise to anybody. The scheme has worked to silence collective student political power and to stop people from even objecting to it because they are too busy paying for it. It has led to a generation of people who believe that the common good is a fairytale and that being in serious debt is the normal financial status of a young person. The idea of health and education being available for minimal cost is a foreign language to most young people. So big ups to the free-marketeers who have achieved their goal. No one saw it coming. 
Coincidentally or perhaps conveniently the global free market has promoted credit to young people and their right to new clothes and cheap travel all paid for on the plastic. Many middle-class younger people would feel deprived if they had to dress out of op shops and sleep on mattresses on the floor which was the norm in my student days. They have been sold materialism as a reward for debt. Other speakers have referred to many who are struggling to survive as students or are too intimidated even to start. That is why we look at the bigger picture in terms of this bill. 
Many students have been persuaded to borrow against their future freedom to build a life beyond working to pay back that debt. However it is now 2010 and the headless chickens who failed to stop the student loan scheme in the 1980s have sewn their heads back on and started to deconstruct what happened to tertiary education. Many of us have figured out that the credit and debt cycle distorts the opportunities of young people and gives them a burden that has been so normalised that they cannot really believe it when my generation talks about paying $150 a year for university fees and books. If members believe that the quality of what students are paying for is so much better than our free education they cannot have been in a tertiary institution lately. 
Our children and older learners do not need an increase in the repayment rate of their loans especially if those children or older learners are already unable to pay. That is why we stand alone against this bill. It is a popular tactic to make the broke pay more. In this brave new world anyone who can pay up front is automatically privileged be it a parking ticket a dog licence or a university education. If you can pay now you are automatically better off. 
Mr DEPUTY SPEAKER 
: The member is bringing the Chair into the debate. 
CATHERINE DELAHUNTY 
: I beg your pardon Mr Deputy Speaker—a person is automatically better off. 
So the Green Party rejects new section 20A(2)(a) in clause 7 which allows for a 15c in the dollar repayment fee to be taken from a person’s wages if that person is a late payer of his or her student loan. That provision alone undoes all the positives in this bill that we would very much like to support. It does not feel great to vote against the common-sense parts of the bill but we clearly need to uphold the principles that few other parties even bother to mention any more. Those principles are that education is a human right and that our young people are taonga to be nurtured rather than an economic resource to be captured. 
If we are to start the work of restoring social equity and building a fair society we have to include the student loan scheme and the broader economic context especially when 72000 young people are out of work or out of training. We have to listen to the stories and struggles of “Generation Debt”. We have to assess in every single bill before this House the quality of the so-called commodity we are selling at this price. We must do that assessment. Does the bill help students and people who are no longer students and have families to support to do better? In what context is this bill being proposed? The debates are raging outside this House about access to education. Despite all the Government’s rhetoric about education there are worrying signals. Student organisations are telling the Green Party that that even if we save the interest-free aspect of the loan scheme entry levels and additional-year entry levels are under threat and fee caps are under threat and there is now even a suggestion that the Government may be dropping the open entry to university at the age of 20. 
We cannot ignore the signals or the context in which we are operating. It is not paranoid to ask where we go from here. In considering any changes to things like open entry at age 20 there are many many stories. We heard the story of Dr Liz Gordon who was a chair of the Education and Science Committee as one example of someone who went to university aged 20. I have family members who did the same thing. Many of us were wayward adolescents who did not know what we wanted to do and we left school despite our parents’ concerns. Many of us returned to education older and wiser and because of open entry we were able to access education and do well with it. 
We are very concerned about where the whole picture is going. We oppose the changes in this bill because we are very nervous that they add to the burden and we do not support the increase in repayments to 15c in the dollar for people who are already behind. We are watching the changes in the weather in the student loan policy arena and it is certainly getting rough. Followers of the political machinations and the student loan scheme will notice the role of the Green Party and the “careful look” to quote the Prime Minister that we will take at any changes to the student loan scheme in terms of who will benefit and who will pay more. We stand here to be consistent about the bad parts of this bill and to vote against it because of our consistent advocacy for the vulnerable and the marginalised instead of the people who already have their wealth. 
TODD McCLAY (National—Rotorua) 
: 
 It is a pleasure to speak in the third reading of the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. The National Government is committed to having in place a student loan scheme that is balanced and at the same time to putting in place incentives for people to pay off their loans more quickly. More than half a million New Zealanders have a student loan and many of those New Zealanders have made long-term financial decisions on the basis of current interest-free student loan policy. We want to ensure that they can plan with certainty. 
Through this bill the National Government has fulfilled its commitment made during the election campaign to keep interest-free student loans for tertiary students. I support this bill fully. Thank you. 
HONE HARAWIRA (Maori Party—Te Tai Tokerau) 
: 
 Kia ora Mr Deputy Speaker. The American poet Robert Frost once said about the privilege of a higher education that education that does not change life much it just lifts trouble to a higher plain of regard. That is a cynical view perhaps but it is one that is no doubt shared by heaps of tertiary students here in Aotearoa. Although people prattle on about broadening horizons and the intellectual challenges of undergraduate and postgraduate education the fact is that the issues that really matter for students are simple ones: access and affordability. Can they get in and can they afford to stay there? The Maori Party believes that a good tertiary education is an investment in our country’s future that it should be freely available to all and that students should get an allowance that is set at the same level as the unemployment benefit. We are a long way away from that point at the moment. 
The Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill raises the issue of eligibility. It allows students who live mainly in their homelands of Niue the Cooks and Tokelau to get interest-free student loans while they are here as a way of encouraging them to go back and help development in their homelands after they get their degrees. That is a notion that fits well with our kaupapa of supporting our whanaunga right across the Pacific to feel free to come here to gain the skills they require to help build their nations. Secondly the bill enables students who are enrolled with a New Zealand institution and who are on approved overseas study to also access interest-free loans. That is welcomed by the New Zealand Vice-Chancellors Committee because it recognises the internationalisation of tertiary education and reflects the increasingly international nature of a great deal of university research. Both areas of course will increase the number of students who can get interest-free loans which is a good thing in itself. Given the importance of tertiary education to our economy that will no doubt receive support from right across the House. 
Another reason the Maori Party supports this bill is that Te Mana Akonga itself welcomes the commitment to look at increasing the income threshold for those getting a student loan as well as the decision to shift the interest-rate mechanism from regulations to the Act making it more transparent to understand and easier to monitor. The Maori Party still raises its concerns about the philosophy of user-pays continuing to dominate our thinking about tertiary education when we should be more focused on investing and keeping our students here. We are concerned about the deplorable state of secondary education which sees too many Maori students still leaving school without even the necessary qualifications for tertiary education and about the cuts in funding for adult education and second-chance learning which makes those inequalities even greater. But in the interests of opening up the tertiary sector to a greater number of students we will be supporting this bill. Kia ora. 
LOUISE UPSTON (National—Taupo) 
: 
 I rise in support of the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill in the third reading. This bill is another example of great work done in the parliamentary process so that the outcome from the select committee process is that the majority of the parties in the House support the legislation with the exception of the Green Party. I must add though for the benefit of people watching the debate that Labour supports the bill. People who have heard some of the comments from the Labour side of the House would I think be quite surprised to realise that it is voting for the bill. I think it is important that when people listen to these speeches they do have a clear view of who is voting for the bill and Labour voted for this bill. 
Labour members got distracted by some other stuff but I think that the important point to notice is that we all recognise that tertiary education is a vital part of growing our economy and our country. As Hone Harawira from the Maori Party has just said tertiary education is an investment in our future and in this particular instance the Government is again delivering a brighter future for all New Zealanders. 
Let us have a quick look at some of the numbers. The number of tertiary students as at July 2008 was approximately 460000. Of that 460000 178000 have student loans. The average student loan with the Inland Revenue Department as at 30 June last year was $16213. The average time taken to pay off a student loan according to the student loan scheme annual report of October last year for students who left study in 1999 appears to be about 8 years. So in effect what we are doing with this legislation is making some improvements to the student loan scheme. There is nothing significant to it. It is basically looking at how we can improve what is already in place recognising the importance of tertiary education to our economy and to our future. 
In terms of the conversations we have had about the value of the debt I want to reinforce the points we made earlier. The sum of $10.3 billion is a lot of money in anyone’s book. So it is important that that debt is managed well and that we are able to look at improvements to the student loan scheme and that we make sure that that Crown asset of $10.3 billion is managed in an efficient and consistent manner. 
The other side of the Chamber has thrown some comments around trying to do its usual tactic of scaremongering and going way off the topic in terms of this student loan bill which has just some technical changes and improvements. I want to reiterate what the points were because for those listening to some of the Labour members they probably have not realised exactly what this bill does. First of all it extends the interest-free loan to two special groups in recognition of the high value of tertiary education in building a strong economy. It extends interest-free loans to borrowers who live in countries that are part of the realm of New Zealand. An important part of its improvements is to extend the interest-free loans to students who are furthering their education overseas. So for example if they are studying a course of a very technical or specialised nature that is not available in New Zealand they are able to still access the student loan through that process. There are a few technical and remedial changes to the bill which I will not repeat given that they have been discussed at length. 
This bill will ensure that the student loan scheme continues to function as intended. It improves the student loan scheme. That is why I am proud to support this bill. 
CARMEL SEPULONI (Labour) 
: 
 I rise to speak on the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. I go back to something that Louise Upston the member on the other side of the House just said. She pointed out that she feels that members on this side of the House have gone way off the topic of the bill and in respect of the issues we have at hand. I think it is really important to note that this side of the House looks at these issues broadly in respect of public statements that have been made by the Government and past actions in tertiary education. We do not take just a narrow view when looking at legislation like that side of the House. I thought that was a really important point to make before I get into what I would like to discuss about this bill. 
This bill is largely technical and Labour will support it. We agree with some things in this bill. We agree with them to such an extent that we actually support this bill. I want to discuss those things but I will also discuss during this speech some of the concerns that we have with the direction that the Government is taking this country with the actions it has already exercised and with some of the statements its members have made about tertiary education. 
One of the main things this bill does is amend the Student Loan Scheme Act 1992 by extending interest-free student loans to borrowers who are present in Niue Cook Islands Tokelau or the Ross Dependency for 183 or more consecutive days in order to encourage borrowers from those countries or that territory to return to their countries and contribute to their development. We on this side of the House support that amendment. We think it is very important that our Pacific people from the territories of New Zealand have the opportunity to return to their homelands if they wish in order to contribute to the social and the economic development of those countries particularly Niue Tokelau and the Cook Islands. It has been mentioned that the population of the Ross Dependency is probably very small and we are probably talking about scientists wanting to come here to train rather than a population of people. We support that amendment. 
Some issues arose during the Committee stage and I have to say that the Minister in the chair the Minister of Revenue responded well to some of the questions that came up. One of them was on what mechanisms the Government might put in place to ensure that those who return to their territories have the mechanisms to pay back those student loans. I think the Minister addressed those concerns. There are still a few concerns. One that I was thinking about but did not get the chance to discuss in full during the Committee stage on Part 1 of the bill was about the Tokelauans. I was thinking of the large number of Tokelauans who work as public servants and who are based in Samoa for long periods of time. We know that Tokelau is very difficult to access. In terms of the public service that Tokelauans have many of their workers are based in Samoa. So I wondered about the provision in the bill that states that students cannot be outside of New Zealand or any of the territory countries for more than 31 days. Samoa is not one of our territory countries and that could affect Tokelauans down the track. I guess that issue will need to be discussed at a later date. We support that aspect of the bill and we commend the Minister for putting it forward. We support it wholeheartedly. 
We are concerned about not necessarily the aspects of this bill but the general direction that the Government is taking tertiary education in this country. We have been disturbed by the lack of attention the National Government has paid to tertiary education. In our minds on this side of the House it would have made absolute sense to invest and to put a focus on tertiary education given the recession and given the high levels of unemployment in this country. Instead we saw as Maurice Williamson likes to refer to a slash-and-burn mentality. We saw cuts to adult and community education; we saw in a concerning way statements put out by the Prime Minister and the Minister for Tertiary Education that student loans will be looked at more closely. A number of other things have been very disturbing to this side of the House and we are watching very closely. 
With regard to what is happening in this bill the irony is that we on this side of the House know that National does not believe in interest-free student loans. We know that in 2005 when the Labour Government introduced interest-free loans the attitude of members opposite including the current Prime Minister—who was National’s spokesperson on finance at the time I believe—was that it was corrupt and it was irresponsible of the Labour Government to do it. I am sure that all those thousands of students out there would disagree with the opinions of the spokesperson on finance at the time and the Prime Minister now John Key on making student loans interest-free. For those of us who—and this has been discussed broadly across the debate as well—have had to access student loans the fact that interest was taken off those student loans and we were not charged interest along the way was a relief to us. It was an issue for those of us who were out working. All we saw every 2 months—or whenever it was when we got the statements—was increasing interest and very little paid off despite the fact that money was coming out of our pay weekly or fortnightly. We have to commend the previous Labour Government for that change; we need to remind the National Government of it. Government members fundamentally do not believe in interest-free student loans. 
This weekend just gone we heard Steven Joyce admit that it was a political call to endorse the interest-free student loan policy in 2008. The members opposite know that if they had made any changes they would have had big trouble with support moving forward. Last year they started to soften the ground for the removal of interest-free student loans with the introduction of the Student Loan Scheme (Repayment Bonus) Amendment Bill. The 10 percent top-up scheme favours high earners who can afford voluntary repayments although they might game the system and decide to invest their spare cash elsewhere and keep the interest-free loans. They are doubly advantaged as the Government assists them to game the system. 
The Prime Minister recently said the Government was going to take a careful look at the policy settings around student support. In our minds the question we straight away think of is what that means. Will the Government make access to student loans and allowances harder? Will it make tertiary education opportunities in universities and polytechs available for the few and not the many? I guess it goes back to what Hone Harawira said when he spoke on this bill: at the end of the day it comes down to access and affordability. We on this side of the House are definitely concerned with those things. 
John Key has referred to students who do not take their studies seriously and who do not get a job quickly after qualifying. Who will determine who those students are? It has been discussed across the course of this debate that unfortunately the research shows that Maori and Pacific students take longer to complete their degrees. As I have discussed earlier and as other people have also said it is not due to lesser intelligence; for many it comes down to their having come from backgrounds where university education or higher-level tertiary education has not been the norm in the family. Many of them are going through university—and I know this from having worked with many Maori and Pacific students—as the first in their families to undertake university study. It is a very foreign environment for many of our students who are going through. Why should they be the ones— 
David Garrett 
: Same speech—heard this. 
CARMEL SEPULONI 
: —I ask Mr Garrett who I know disagrees with everything I am saying—who have their lives placed in jeopardy and who have their futures put at risk because this Government does not understand the need to make sure that tertiary education is kept affordable and accessible for a wide range of people not just for those who have the money to pay for tertiary education? 
Those are some of the concerns that have been raised. Labour members support this bill but it brings to light some of the wider issues we have with the tertiary education system and with the direction that this Government is taking it. In light of the high levels of unemployment particularly for our youth—and particularly for our Maori and Pacific youth where the unemployment rate is sitting at around 30 percent—it is very important that the Government takes tertiary education seriously. It is important that alongside creating jobs for this country and for those groups of people the Government is also providing quality tertiary educational opportunities. Thank you very much. 
JO GOODHEW (National—Rangitata) 
: 
 This debate on the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill has been really revealing. What a load of drivel we have had to listen to at times. I will take a few moments to address some of the concerns that have been raised. We have heard in this House this afternoon concerns that students are having to buy their clothes at op shops. Well that raised for me some really serious questions. I believe that students have an understanding of the cost of their education their tertiary education to this country. They certainly understand how much it is costing them and in many cases costing their parents as well. I can think of some really good examples of young people who in fact are very happy to go and get fantastic bargains from op shops or second-hand clothes shops. 
In fact I have a story from close to home a story about a retro party that is happening tonight in Dunedin at Otago University. My daughter has purchased a bright orange frock from an op shop and she is adding that to her bright yellow shoes—so she tells me—and the wonderful pink tights I sent her away from home with. So there we go; what is wrong with young people understanding how to get a bargain? In fact their tertiary education is a bargain because roughly speaking they are being asked to contribute to about only a quarter of the cost. 
Speaking of bargains I have a story of my own. Prior to becoming an MP I was walking along an Auckland street and I spotted a gorgeous jacket in a second-hand shop. I thought “My goodness I will just see if that fits me.” It was a lovely jacket. I purchased the jacket wore it for quite some time—again prior to getting into Parliament—and one day I saw a photograph of a very famous person wearing that very same jacket. It crossed my mind: “Oh my gosh did Helen Clark own that jacket before me?”. Maybe! Who knows? 
Anyway we know that young people attending universities and polytechnics who have student loans have to learn how to budget. They have to learn the value of money. Hopefully at the same time they are getting an excellent tertiary education. But this bill is simply about maximising the benefit of the Crown’s $10.3 billion asset in student loans because really we—and I confess I include myself—have been getting a little bit off-track. We have also heard suggestions that back in 2005 there were words that revealed that National at the time was not keen on Labour’s student loan policy. But hang on a minute! Times change. What we have now is a $10.3 billion investment. Let me repeat: National’s commitment is to having in place a student loan scheme that is balanced while at the same time putting in place incentives for people to pay off their loans more quickly. 
For young people to get out of debt more quickly what can possibly be wrong with those sorts of levers? What can possibly be wrong with a fresh-eyed National Government looking at the student loan scheme and finding ways of improving it with the mechanisms used by the Inland Revenue Department finding ways of improving it for those who are studying overseas and finding ways of improving it so that it continues to function as the student loan scheme was intended to? 
National is absolutely committed to the importance of tertiary education to build a strong economy but at the same time there are settings all around that that we have to make sure are correct. That is why the Hon Peter Dunne has brought this bill to the House why we are passing it now and why before very much longer—in fact just shortly after the House meets again—it will be enacted on 1 April. 
I reiterate National’s absolute commitment to having a fresh look at legislation a fresh look that I have heard has meant that Ministers are competing against each other because they have so many bills they want to bring to the House in order to make New Zealand a much more productive economy and a better place to live in in the hope that our tertiary-educated students will continue to live here and be productive people in our economy. I am certainly looking forward to that and hoping that it means that our three daughters will get that message stay here in New Zealand and bring up their children close to me. Thank you. 
CHRIS HIPKINS (Labour—Rimutaka) 
: 
 I listened quite carefully to that contribution on the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill from National member Jo Goodhew. I thought that what was quite revealing was not so much what she said but what she did not say. At no point did she commit National to retaining the interest-free student loan scheme beyond the end of this term. She responded to a lot of the points that Labour members had made but at no point did she deny that some time in the future National wants to do away with interest-free student loans. It would not at all surprise me if that is what National wants to do because it was so vocal in opposing the interest-free student loan policy when it was first introduced. 
I will go back and respond to some of the comments that have been made. The debate in this third reading has ranged reasonably widely. I think that that is probably because in the nature of urgency we have canvassed a lot of the specific material of the bill already today. Members have talked a lot about the value of tertiary education as an investment in the future of our country and I echo some of the comments raised by members—particularly by those on this side of the House but even by some of the members on the other side of the House as well. We cannot view investment in tertiary education narrowly and only in economic terms; we have to look at the investment we make in all forms of education including tertiary education as an investment in the development of New Zealand society. Not all of that investment will necessarily lead directly to an improved economic return. But overall if we build the level of social capital within New Zealand by having a more educated society then in turn the effects of that will flow on to a more economically prosperous country—one with a higher standard of living higher wages fewer long-term health problems and so forth. So we have to look at the investments that we make in education including through the student loan scheme with that very broad picture in mind. 
With that in mind I tell the House that there has been some fairly recent research. I have just been reading a book called  
The Spirit Level 
 which talks about the fact that countries that are more even—where there are higher levels of education and where the gap between the rich and the poor is lower—generally tend to have far fewer other problems than other countries. They have lower crime rates longer life expectancy fewer health problems and so forth. So investing in education including tertiary education is an important part of making sure we increase our social capital and decrease some of those wider social problems. The student loan scheme provides a step on the ladder into tertiary education for those who otherwise could not afford it. It is a fairly recent initiative; it extends back only as far as about 1992. Of course we would not have the student loan scheme had National honoured the pre-election promise it made in 1990 to abolish all student tuition fees so that tertiary education would return to being free. Of course that is what many of the members in this House received when they undertook tertiary study. They received their tertiary education for free and a lot of them received some form of allowance during the time they were studying. Some of them may have been bonded during that time. I know that one of my parents received a tertiary education paid for by the State and was bonded as a teacher as a result. There is a whole generation of New Zealanders who benefited from policies such as those which have been taken away from the several generations that have followed. 
I note that one of the reasons the student loan scheme was established was to make sure that despite the increased cost of tertiary education people can still access it. They are not excluded on the basis of cost. Having said that I say that it is not the ideal mechanism. I for one hold out hope that one day we will return to a situation where tertiary education is far more accessible and the costs are not as prohibitive as they are now. I appreciate the economic realities of that; it will not happen overnight. I acknowledge that back in 1999 when the Labour Government was elected we were not suddenly going to revert to the days when tertiary education was completely free. That is why over time I was very supportive of the initiatives that the previous Labour Government put in place to progressively lower the cost of participating in tertiary education. It began in the early days with the cap on student tuition fees so that they did not continue to grow to the massive extent they grew in the decade prior. 
There were other things such as the abolition of interest on student loans while a student was studying. When I first entered tertiary study one of the most frustrating things about the student loan scheme was that during the time I was studying I was accumulating interest on my loan despite not earning anything and not having any ability to make any repayments. All of the money that I was earning through my part-time job—stacking bread for Quality Bakers—I was putting into reducing the amount of money that I needed to borrow in the first place. I was not making any student loan repayments and in the meantime the interest was accumulating. When the Labour Government came in in 1999 it put an end to that. I think that was a very welcome initiative although it took another 6 years before the Government was finally in a position to do away with interest on student loans altogether. As somebody who was involved in the development of that policy I can say that I am particularly proud of that. I know the huge impact that that has had on the repayment times for some of our student loan borrowers. When talking about discouraging people from leaving New Zealand—we want them to stay in New Zealand— we understand anecdotally that one of the things that drove people away was the huge mounting student loan debts they had by the time they had finished studying. Removing the interest on their student loans if they stayed in New Zealand provided an incentive for them to stay here contribute to the New Zealand economy to our country and to our society and get rid of their student loans. I think that was a very very good thing. 
There were many other things in the overall mix such as the Step Up Scholarships. Stepping up is a term that seems to have been adopted by members on the other side of the House these days but it was the last Labour Government that introduced Step Up Scholarships to make getting into tertiary education a little bit easier for some people who had previously been disadvantaged. It should be noted of course that all of the initiatives that I have just talked about were opposed by the then National Opposition and quite vocally so as well. National opposed all of those initiatives. We have well and truly canvassed John Key’s pledge to fight the introduction of interest-free student loans with every bone in his body. 
Moana Mackey 
: Oh! 
CHRIS HIPKINS 
: That is right. He pledged he would fight it with every bone in his body. Here we are a year and a bit into a National Government and interest-free student loans are still there. He pledged to fight it with every bone in his body so one can only conclude that he does not have any spine left as my colleague Moana Mackey said. 
National members have clearly demonstrated during their time in office that they do not have a lot of time for tertiary students. They are quite intent on cutting a lot of things in tertiary education that lead to an increase in social capital that help those people at the bottom end of the spectrum to get into tertiary education—or into any form of education—to upskill themselves and to move on through the system. An example is the abolition of night classes. People cannot get a student loan for night classes but they did not need one because they were relatively cheap. People did not need a student loan to get into a night class. Night classes are gone now. They were a stepping stone that led into other forms of tertiary education but they have gone. The training incentive allowance reduced the amount that people needed to borrow when they undertook tertiary education but that has gone. It was cut by the National Government. I turn to voluntary students association membership. If the Government cannot get the students associations on board with it it will do away with them altogether. It is a tried and true trick from the National Government. If the Government cannot get its opponents on board it will do everything it can to put them out of business. I think that is pretty sad. 
I think this bill is a good bill. We have talked a lot about the details and I want to thank once again the Minister in charge of the bill for his willingness to engage in the debate. I have raised several issues with him and he has responded to me. That included a commitment on behalf of both of us to work together on one or two of those issues to see whether we can further them outside the scope of this bill and I want to thank him for doing that. But my main concern with the bill is not so much with what is in it because Labour supports it but with what is not in it and what might be coming further down the track. I would be very concerned if the National Government moved away from its promise to keep the interest-free student loan scheme. That certainly seems to be what it is lining up for. John Key mentioned in his speech that the Government will be taking another look at all of the settings around student support in tertiary education. Similar comments have been made by the new Minister for Tertiary Education Steven Joyce. I think it would be very sad if the National Government went back on its promise to retain the interest-free student loan scheme whether the Government was going to go back on it at this election the next election or the one after that. I hope that the Government will maintain interest-free student loans. I think it is a very good scheme. It is one that we are very proud of; I am very proud of it. It was passed by a Labour Government despite very vocal opposition from the then National Opposition. I would like to see the scheme stay in place. 
NICKY WAGNER (National) 
: 
 I support the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. As we have heard today in the House it is mainly a technical bill which includes as everybody agrees several useful technical amendments. It clarifies some exemptions for students living outside but within the realm of New Zealand and for those who are studying overseas. 
The bill also makes some very sensible changes to interest payments. It has a softening of the conditions for those students who are fully repaying their loans and an extension of relief for other students on hardship grounds. But there is also a firming up of consequences for students who have failed to make payments failed to correct deductions or failed to pay any due amount. For those students the Inland Revenue Department will be allowed to increase the standard rate of repayment deductions from 10 percent to 15 percent. 
As we have heard in the House today it is great that New Zealand students have the opportunity to have a student loan scheme and it is great that it can help them to get a good tertiary education so that they have a future and a good career proposition. It is also great that the Government is joining with students to invest in their future. Thank you. 
A party vote was called for on the question  
That the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill be now read a third time. 
Ayes 113 
New Zealand National 58; New Zealand Labour 43; ACT New Zealand 5; Maori Party 5; Progressive 1; United Future 1. 
Noes 9 
Green Party 9. 
Bill read a third time. 
Animal Welfare Amendment Bill 
First Reading 
Debate resumed from 18 February. 
COLIN KING (National—Kaikoura) 
: 
 The Animal Welfare Amendment Bill is a very appropriate bill to be considering because as a nation we have a huge number of animals. In actual fact sometimes it is a bit of a joke that New Zealand is known worldwide for having far more animals than humans. We are quite pleased about that however because as a nation we have a primary sector economy and that primary sector economy contributes to a first-class economy. So this bill is indeed timely. 
Sadly there is from time to time outrageous behaviour that does not do anything for New Zealand’s image and we need then to have a structured process of penalties in place for people who mistreat animals. That is what the Animal Welfare Amendment Bill refers to. It brings in a new regime of punishment for people who commit crimes of cruelty against animals. It is worth noting that previously the ultimate crime against an animal was wilful ill-treatment but there were very very few occasions when there was a guilty verdict in those cases. That was largely because it was very difficult to show that wilfulness. This bill introduces another category of reckless ill-treatment. I think that that is very sensible because reckless behaviour is something that can be quite predictable and a normal person will understand it. 
The bill effectively has two parts to it. There is the regime that sorts out the behaviour of reckless ill-treatment and there is the aspect that deals with how long a person who is judged to have committed cruelty against an animal is disqualified from owning an animal. The bill also talks about the contravention of a court order that prevents somebody from having an animal. 
This bill will attract a significant number of submissions and we in the Primary Production Committee will welcome them. The committee I believe is ideally situated to consider the submissions. We will certainly welcome them but we encourage those people who submit to do so within the context of the bill. I say that because we have quite a structured process within New Zealand of managing best practice. We have the common-sense behaviour of looking after pets in cities which is looked after by the SPCA or the Royal New Zealand Society for the Prevention of Cruelty to Animals. Then we have the National Animal Welfare Advisory Committee which rules and adjudges on what is considered best practice with regard to domesticated animals like sheep cattle chooks pigs and so on. So when those submissions come in and we consider them they will need to be in the context and the scope of the bill. 
On the bill’s first reading the Minister stood up and said that he would like to see it reported back to the House in a timely fashion. That report back will be on 20 April. We need to consider that once we finish this session—tonight or tomorrow or whenever it is; we are still in urgency—there is a 2-week adjournment. On that basis we will have to be pretty quick in getting those submissions in because there will be I am sure a large public interest in this bill. 
The regime of fines has been doubled effectively. It might be a fair point to make that doubling a fine does not actually remedy a situation. However I think that it does clearly lay out to the community and to society as a whole the value that we put on our loyal faithful pets and on those animals that we extract a living from. Effectively the penalty regime is raised from $125000 for a body corporate up to $250000. It sounds like a lot of money but the point that is of interest to me is that an individual can actually get a prison sentence but a corporate body just gets a larger fine. Nobody actually comes up for trial for cruelty in the latter case. 
There will be a lot of interest as I have said in this bill. I trust that those who are submitting on it will do so in the context of the bill because we are looking at a regime or structure of penalties for cruelty and on that basis alone I imagine that we will not try to get into a field where we say we should be able to do something or we should not. The debate will be about the aspects of a workable solution because judges have been criticised for not implementing the law; I have to say that until this bill came along it was virtually impossible for them to do so because it was so difficult to prove the wilful aspect of ill-treatment. So the introduction of a reckless ill-treatment category will greatly aid the whole process and I am sure we will see a lot more convictions for those people who should be treated as criminals. Thank you. 
Dr ASHRAF CHOUDHARY (Labour) 
: 
 It is my pleasure to speak in support of the Animal Welfare Amendment Bill. I first acknowledge Simon Bridges who initially introduced this bill which has now been adopted by the Government to the House. I am delighted to support this bill after all the horror stories that we have seen on television and heard about like the killing of 33 dogs and the kittens fed to pit bulls and filmed—those terrible things that happened to pets. 
I say at the outset that Labour members do not accept animal cruelty at all. We are totally against cruelty not only to pets but also as I will discuss a little later to farm animals. As human values and perceptions of pets and their welfare change over time we need to think about farm animals as well. In 2008 11000 complaints were received by the SPCA about animal cruelty. Out of those only 110 resulted in any charges being laid. Out of those 110 cases only 58 people were convicted. That shows either that judges or courts do not take the issue of cruelty to animals very seriously or our values do not cause us to take the issue very seriously. 
This bill essentially raises fines from $50000 to $100000 and the term of imprisonment from 3 year to 5 years. As the previous speaker Colin King said increasing the penalties will not make a heck of a lot of difference by itself. What really has to happen is for us to put some resources into the issues. For example 20 years ago one-third of animal welfare cases were dealt with by the police one-third by the Ministry of Agriculture and Fisheries and one-third by the SPCA. Now the SPCA deals with 90 percent of animal cruelty cases. The SPCA needs further resources to make sure that those cases are dealt with properly and the Government needs to make sure that it supports the SPCA to deal with such cases. The most important thing is to put more resources into dealing with this issue—for example prosecuting those cases costs thousands of dollars. So there is a need for further resources to make sure that animal welfare is looked after. 
The thing that I am really concerned about is not only cruelty to pet animals; as the area of legal practices changes around the world and the perception about animal cruelty and the treatment of animals changes around the world we also have to think about farm animals. As I alluded to before in recent times there has been a lot of talk about cubicle farming and also a debate about 1080 possums and sow crates. Of course we have been raising around the world the issue of whaling and the public is becoming aware of all those issues. Years ago many moons ago when I first came to this country— 
Hon Darren Hughes 
: Many many moons. 
Dr ASHRAF CHOUDHARY 
: —many moons ago—thousands of lambs died in the snow in wintertime and I wondered about the way we do farming when thousands of young animals of 1 and 2 days old were dying in the cold. The issue was whether we were treating our animals the way they should be treated. There is some controversy about cubicle farming in Canterbury. 
In one generation the perceptions about animal welfare and cruelty issues have come into our consciousness. We are always now thinking about how we treat these animals—and how we raise farm animals and how they should be treated. I think this is very important as pressure comes on us particularly from overseas markets where we send our live animals. There has been an issue about live animals going for the haj. There has been an issue about that and about the likelihood of cruelty to some of these sheep that are sent overseas. 
In my view we need to make sure that in the future we have a more comprehensive bill for animal welfare. This amendment bill in my view is just part of an ongoing issue rather than a solution. There is a lot of concern from the various animal welfare movements particularly from the countries that import our live animals. We export meat to some of those markets. The perception is changing. We have to make sure that over time—soon I hope—the Minister of Agriculture the Minister of Justice or whoever brings forward a more comprehensive animal welfare bill which will make sure that not only our pet animals but also our farm animals are properly treated and that we fulfil the expectations that are out in the markets to which we export our animals. 
As even Government members accept this bill by itself by raising imprisonment to 5 years will not solve the problem. I honestly say and I am sure that my colleagues on the Primary Production Committee will agree that this is an interim arrangement. In the longer term we need a comprehensive animal welfare bill so that we can— 
Sandra Goudie 
: There’s nothing “interim” about a law change. 
Dr ASHRAF CHOUDHARY 
: Well I know it is an important issue but I think we have to go to the next step. We have to look at other issues that deal particularly with our farm animals because as the perceptions change in the markets importing countries will have stringent requirements. As we know people are now tracing where our meat comes from. Some of these green movements and other similar movements require stronger animal welfare laws and regulations so we have to follow those. 
In a nutshell I say that I support this bill wholeheartedly and I agree with the Government and all of the parties that are supporting the bill that it is a useful interim arrangement. But in the long term we have to make sure we have a fully fledged animal welfare bill that can look into the issues concerning farm animals as well. With those few words I say thank you and I thank my colleagues. 
SANDRA GOUDIE (National—Coromandel) 
: 
 I am delighted to speak on the Animal Welfare Amendment Bill. I applaud my colleague the Hon David Carter the Minister of Agriculture for bringing this bill to the House. It is in support of an initiative of Simon Bridges the excellent member of Parliament for Tauranga. He is an outstanding young man who has a fantastic future ahead of him. 
This bill has been roundly applauded throughout New Zealand. I will mention some of the key people who have supported it. Bob Kerridge said that “It is time to recognise that cruelty to animals is a social sickness that is as heinous as any act of violence inflicted on fellow humans and the two are inextricably linked.” That is what Bob Kerridge said. He is the Auckland RSPCA executive officer he is well known and he represents the views of many people throughout New Zealand. The next person I will mention is David Jones QC. He said that “This [bill] would add to the effectiveness of animal welfare legislation and bring home to the public that animal cruelty is not acceptable.” This bill is by no means an interim measure. The third key person who has made a comment on this bill is Dr Wayne Ricketts from the Veterinary Association. What did he say? He said that he “backs increasing the maximum penalty for the wilful ill-treatment of animals.” He also said that “Light sentences send the wrong message to society about the responsibility of humans for the welfare of animals.” This bill has been roundly endorsed by a number of people but many more people support those very same views. The bill was also applauded by Robyn Kippenberger who is the National Chief Executive of the RSPCA. She said that “the move was long overdue especially as animal cruelty cases were increasing in number and severity.” 
I will outline a couple of these cases. They are very offensive incidents. This is not a very nice story but I will share it with members because if this type of person can do this to a kitten one has to wonder what level of cruelty he might inflict on family and friends around him. Last month in Auckland a man twisted off the head of a kitten in front of his young children. There was also the case of the man who fed live kittens to his pit bull dog and the case of the 33 dogs that were shot in a very inhumane way. There was the incident of the dog that was found drowned in Titahi Bay with a 10 kg weight tied round its neck. These are all heinous crimes against animals. These are serious cases of animal cruelty. By increasing the sentences we are sending a very clear message which should in turn help to deter people from acting in this way. 
Although we have had a lot of support for the introduction of this bill the Greens and Labour have been able to find some reason to be dissatisfied. Those members have said that there was no point in increasing the penalties for animal cruelty if no one would enforce them. 
Well of course the penalties will be enforced but those members say there is no point in increasing the penalties. [ 
Interruption 
] That is what they said. They are aware that extra funding will be put in and that there are people there to enforce the penalties. If those members were aware of what was going on they would know that lawyers are working pro bono to bring animal cruelty cases to court for conviction. I applaud those lawyers. I think it is a fantastic step in the right direction. I understand that other lawyers are looking to take up the challenge of doing pro bono work on animal cruelty cases so that people who commit the kinds of offences I have described—twisting off the head of a kitten in front of children—will be charged taken to court and be convicted. Under this Animal Welfare Amendment Bill those offenders will receive the sentences they rightly deserve which are more stringent than the sentences currently in place. This bill will send a very very strong message. 
The purpose of the bill is to increase the sentences for these horrifying incidents. In relation to wilful ill-treatment it raises the penalties for animal cruelty and neglect offences and it changes the way in which some offences are described. The offence of wilful ill-treatment of animals covers the most serious welfare offences. Under the Act as it stands it must be proved that a person intended to cause harm and the animal must be permanently disabled die or be destroyed to prevent further suffering. This bill expands the threshold for this offence to include cases where an animal is seriously injured or impaired. That will enable more cases of extreme cruelty to be prosecuted under this offence. An animal is seriously injured or impaired if the injury or impairment involves prolonged pain and suffering substantial risk of death loss of a body part or permanent or prolonged loss of a bodily function or requires treatment by or under the supervision of a veterinarian. 
The maximum penalty for wilful ill-treatment of animals will increase to 5 years’ imprisonment. The maximum will be 5 years and if that is not a deterrent to people who inflict cruelty upon animals I do not know what is. There is also a fine and the maximum will double to $100000 for an individual and $500000 for a body corporate. If that does not send a very strong message that good caring solid Kiwi New Zealanders who have animals in their care and look after them properly expect others to do the same then I do not know what will. Animals need to be cared for in a robust way. They need to be housed fed and watered. Dogs need to be taken for walks. We expect all of those sorts of things to occur. Every animal requires a different type of care but we except animals to receive the optimal care available. 
This bill creates a new offence of reckless ill-treatment of animals. This new offence will apply where it can be proved that a person knew or appreciated that serious harm to an animal could occur and unreasonably ran the risk of that happening. It is expected that cases would be prosecuted under this new offence when they otherwise failed to meet the threshold for wilful ill-treatment. Until now there has been no choice but to prosecute these cases under a lesser ill-treatment charge which resulted in inappropriate sentencing and the wrong message being sent to offenders that animal welfare offending is not serious. That is the great thing about this bill; we are sending a very clear message and it has been roundly endorsed throughout New Zealand. The penalties for this offence will be a maximum of 3 years’ imprisonment and fines may be imposed of up to $75000 for an individual or $350000 for a body corporate. 
There are other offences. The court may disqualify a person from having custody of animals and may order the forfeiture of animals. 
Those are some of the key points of this bill. Most New Zealanders expect people to care for the animals in their charge. They want them to be healthy comfortable and properly fed and to have a reasonable standard of care and humane treatment. They expect that they will not suffer unnecessarily. This bill is a great step forward. It is not an interim measure. It will provide outcomes and will act as a strong deterrent to anyone ill-treating animals. 
CAROL BEAUMONT (Labour) 
: 
 I too rise to speak in support of the Animal Welfare Amendment Bill. I acknowledge the contribution of Simon Bridges to bringing this bill to the House although it has now become a Government bill that is supported by all parties. 
The timing of this bill has probably been forced along as a result of the huge public outcry following some high-profile animal abuse cases. It is fair to say that most New Zealanders treat animals humanely whether in a farming context or a domestic context but animal abuse cases are still too common and they are not isolated. I happened to be looking at some of my local community newspapers and I am holding up an example I found headed: “Family pet may have been thrown off bridge”. These sorts of things are sickening. I will not recite a big litany of cases; I too have seen the SPCA’s list of terrible cases. I think that when most of us hear of these cases we are sickened and disgusted by the sort of treatment that is meted out to animals both domestic pets and farming animals. As we all know in this House those animals cannot defend themselves and cannot speak on their own behalf so it is up to us to do so. 
I will not read out the main provisions of the bill as the previous speaker Sandra Goudie has done that. The basic points in the bill are first of all to increase penalties for some existing offences such as for wilful and reckless ill treatment and other ill treatment offences while putting in place a new offence of reckless ill treatment. There are two provisions in the bill that I think are very important and very useful. One is the strengthening of the provision disqualifying a person from having custody of animals and the other is the strengthening of the provision relating to the forfeiture of animals. Those provisions are very useful contributions to the tool box of things that we can do in response to the abuse of animals. I certainly think it is important that we are sending a message to New Zealanders about the view of this Parliament which is that we need to be tough on people who abuse animals. 
The relationship between animals and people is really important; I will talk a little about it. Other speakers—Jim Anderton Damien O’Connor Sue Kedgley and others—have spoken about the economic importance of animals to this country and about the importance of ensuring that we treat those animals appropriately because we should but also because there is a requirement that animals be treated humanely in order for us to be able to trade with other countries and to meet the consumer demand. 
Animals are very important to this country economically but also socially; I will talk a little about that. Clearly there is the domestic pet scenario. I am sure most people in this House either have or previously have had animals in their life as domestic pets or companions. Certainly my cat Sage who is 14 years old has been a very important part of my life. Animals also have a role socially in terms of therapy and I will talk about some of those roles because I do not think they have been mentioned yet in the House. We have not yet talked about some of the really important ways that having animals with people makes a difference. Animals are used in therapeutic care in the Maungakiekie electorate where I work. I am aware of the use of animals in schools such as dogs in schools programmes which teach children about looking after animals properly and also about the different responses of animals to different situations. I know that in one of the local churches in Onehunga animals are used in grief counselling with children. That is very important. Pets are increasingly being allowed in rest homes because it makes a difference to the quality of life of the residents. 
Animals are also used therapeutically in terms of treating people who are ill and are hospitalised. Again interestingly enough I have just gone through the local community papers and found a story in the  
East and Bays Courier 
 of 12 February about Ella’s special place. It has been recently opened and is a particular corner of Starship Children’s Health in Auckland where children can have their pets. It has been named after a young girl Ella who was 5 when she died in 2003 of an inoperable brain tumour and it is a memorial to that young girl recognising the importance of the comfort people get from being around animals. I think it is really important to recognise the relationship between people and animals. 
I will go on to look at the abuse of animals as a crime of violence. It is actually a crime of violence. We have a sickening record in this country of violent crime and I particularly want to put on record in speaking to this bill the sickening record of violence against children in New Zealand. The reason I am raising this record in the context of violent crime against animals is that I think these things are not unrelated. I believe violent crime—whether it is against another adult against children or against animals—has certain common factors. One of the issues I have about this bill is that it deals with one end of the spectrum—dealing with crime—and I want to talk about the other end. I want to talk about the prevention of crime. What are the causes of crime? What leads to people being violent whether it is against children animals or other adults? What are the causes of crime? We need to do more in that area. We need to look at the culture of violence in this country that makes it acceptable for people to behave in a violent manner and that can in fact glorify violence. 
There is a lot of research and information around the issue of empathy. People get the skills and the neurological links in their brain to be empathetic at a very very young age—as babies. The relationship between babies and their mothers in particular is very important. Where there is a lack of empathy in a very young child it can flow on to violent crime. There is a whole lot of important work in support of what we need to be doing around parenting to support young mothers. There are issues around how we learn to respect and care for each other and for animals. I have always had pets in my life; with my parents caring for our animals was a very important message. We need to look at all those areas in terms of preventing violent crime. 
There is certainly plenty of evidence about the links between animal abuse and other violent crimes. In preparing to make this speech I looked at some of the research. Certainly a lot more work is now being done about cross-reporting—that is when people hear about animal abuse they are also looking to see whether domestic violence and cruelty to children is going on in the same home. There was a very interesting report in the  
Bay of Plenty Times 
 about the fact that the SPCA routinely investigates complaints of cruelty to animals and finds other forms of offending as well. I will not go through all of the detail but there is clear information around the links between violence against animals and violence against humans. Often it is a starting point and people go on to become violent against people. 
We have to look at the very important issue of enforcement. One of the things that worried me as well as the need to perhaps do more in the prevention area is that we can put in place tough penalties but we need to be able to find out about the crime we need to be able to police it and we need to be able to monitor it and respond. As others have said the Ministry of Agriculture and Forestry has five inspectors and seven contractors for the entire country to look at what is going on mainly in terms of our farming animals. The SPCA does the absolute lion’s share of the work. It is a voluntary organisation; it does not receive Government funding. I place on record my acknowledgement of the work it does. I am sure everybody in this House would agree with me. But too few people work for the SPCA so if we are serious about doing this we need to look at ensuring that it is resourced to do the job. Certainly one of the things that American states have found in toughening up against abuse cases is the need for evidence to support prosecution. 
In winding up I concur with the point that Jim Anderton made that if we do not put resource into this issue then this bill will be simply window dressing. Thank you. 
Dr CAM CALDER (National) 
: 
 It gives me enormous pleasure to rise and speak briefly on the Animal Welfare Amendment Bill. I compliment my colleague across the House Carol Beaumont for an extremely well-considered and succinct address covering off most of the key points in this debate. I also at this stage acknowledge Simon Bridges who not only is the second-sexiest male politician in New Zealand but also had the wit and concern to address himself to a very serious issue in New Zealand—namely cruelty to animals. As we know the Government has adopted Simon Bridges’ bill and tweaked it in a number of areas. Many speakers have gone to great pains to outline the details of the bill which is a comprehensive and significant improvement upon the current legislation. 
This bill sends a strong message. Miss Beaumont indicated that it makes it very clear that violence is not OK. We know it is not OK against children we know it is not OK between adults and it is certainly not OK against animals. This Government is all about creating a brighter future for New Zealand and improving our performance in all sectors. This bill is our attempt and our initiative to address an area where we see a great need. I take this opportunity to commend this bill to the House. 
Bill read a first time. 
Hon NATHAN GUY (Minister of Internal Affairs) 
 on behalf of the  
Minister of Agriculture 
: I move  
That the Primary Production Committee consider the Animal Welfare Bill 
 that the committee report finally to the House on or before 30 April 2010 and that the committee have authority to meet at any time while the House is sitting (except during questions for oral answer) and during any evening on a day on which there has been a sitting of the House and on a Friday in a week in which there has been a sitting of the House despite Standing Orders 187 and 190(1)(b) and (c). 
Motion agreed to. 
The House adjourned at 5.38 p.m. (Thursday)