Financial Review Debate — In Committee 
Financial Review Debate — In Committee 
[Volume:653;Page:2421] 
Financial Review Debate 
In Committee 
The CHAIRPERSON (Eric Roy) 
: I have quite a bit to inform the Committee of. 
The House is in Committee on the Appropriation (2007/08 Financial Review) Bill. The Standing Orders provide for the financial review debate to be the Committee stage of the Appropriation (2007/08 Financial Review) Bill. The debate comprises two distinct elements—it would be helpful if members were able to absorb this as we progress through the debate. The financial review debate commences with a debate on the annual financial statements of the Government as reported by the Finance and Expenditure Committee. Once this debate is disposed of the Committee debates the individual financial reviews of departments and Offices of Parliament and non-departmental appropriations as reported on by select committees. 
Members will note that for the first time this portion of the debate includes debate on non-departmental appropriations. Members will recall that changes adopted last year to the Standing Orders provide for non-departmental appropriations—section 32A reports—to be subject to parliamentary scrutiny. Although the services and outputs covered by non-departmental appropriations are provided by other organisations an administering department as the name suggests has some responsibility for these appropriations and for reporting on them. A list of financial reviews and non-departmental appropriations available for debate is on the Table. 
The debate on the Government’s financial position may be fairly wide ranging but the debates on the individual financial reviews of departments and Offices of Parliament and on non-departmental appropriations should be relevant to their performance in the 2007-08 financial year and to their current operations. A member may have no more than two calls on each financial review. Four hours is allowed for both elements of the financial review debate. At the conclusion of the 4 hours a single question is put on the provisions of the bill. There is no amendment or debate on this question. The Chairperson reports the bill to the House and it is set down for third reading forthwith; there is no debate on the third reading. 
Treasury 
Financial Statements of the Government of New Zealand for the year ended 30 June 2008 
The CHAIRPERSON (Eric Roy) 
: I ask that members turn to the report of the Finance and Expenditure Committee on the annual financial statements of the Government. The question is that the report of the Finance and Expenditure Committee on the annual financial statements of the Government for the year ended 30 June 2008 be noted. I note that this report also relates to the Finance and Expenditure Committee’s financial review of Treasury so the performance in the 2007-08 financial year and current operations of Treasury may also be debated. 
Hon DAVID CUNLIFFE (Labour—New Lynn) 
: 
 It is entirely appropriate that you reference those financial statements Mr Chair; I recommend them for people’s reading. 
I begin with a quote: “It is part of the New Zealand way of life that when New Zealanders face economic uncertainty they look to their Government not necessarily to take away that uncertainty but to show a path through it.” What have New Zealanders found out today? They found out today that in the face of growing uncertainty in the world economy and in our own economy this Government has no idea what it is doing. The quote is from Bill English. 
Despite the fact that National inherited a sound economy from the previous Labour Government—with by the Minister’s own admission some of the strongest growth lowest debt and lowest unemployment in the Western World—it is true that we stand in this Chamber today on a day when unemployment is forecast to rise by another 60000 this year. Sixty thousand workers 60000 families—60000-plus New Zealanders—fear for their homes and livelihoods and they are wondering how they will put bread on the table. 
This situation is a serious economic challenge. We have spoken about it many times in this House. The reports today bear upon the truth of the matter. Rather than the world economy growing by 2 percent this year it will shrink by nearly 6 percent. It is an unprecedented falling off the cliff for the global economy. It hurts us in two ways: New Zealand businesses out there in the world cannot borrow like they used to and we cannot export our services. But that is the world as it is. What concerns the Opposition—and I think all New Zealanders—is the Government’s response to that situation. The response has been inadequate on a number of fronts. National’s construction of the stimulus it has put into this economy is misleading and overstated; it largely re-brands work Labour did prior to the election. The programme includes double-counting low-quality investments and smoke and mirrors. 
National’s tax cuts—the centrepiece of its programme—are completely inappropriate. The tax cuts take nearly $1 billion from the poor—those below - average income earners—and give it to the wealthy. One-third of the total tax remission goes to the top 3 percent of earners and 70 percent of New Zealanders with children get nothing at all. People who earn less than $40000 and have children get nothing—nothing at all. The economics of that situation are lunacy. We all know and all the commentators know that the wealthy will save or otherwise dispose of—but not spend—what they get in tax cuts. That is why the multiplier is lower for tax cuts for those on higher incomes than it is for tax cuts for those at the bottom. Not only are National’s tax cuts inequitable but they make no economic sense either. 
The so-called rolling maul of initiatives has been the subject of much debate over the last few days. It was one thing for Bill English to describe his leader as hopping benignly from cloud to cloud. It kind of suited the spin—if anyone still believes it—that somehow “Labour-lite” in drag got elected. Now the truth is clear: what the Minister of Finance and the Prime Minister think are completely different. The Minister said this weekend that there is no way the Government will fund $50 million for a cycleway—not this year he said with a smirk and not next year or the year after. The Prime Minister says that we will come out of the recession aggressively in 2009; the Minister says we certainly will not. They cannot even agree on the nature of the problem so how can we hope they will agree on the solution? They cannot even agree on the problem. 
The term “rolling maul” was convenient when National believed that it could get out initiatives in dribs and drabs and that New Zealanders would somehow be satisfied with that but we come back to the Minister’s own words. New Zealanders do not expect the Government to take away the international recession but they expect a credible game plan upon which to invest and build their businesses and that will protect their families. This Government has no such plan. It has a series of contradictory show pony initiatives like the cycleway to nowhere. In the background the Government is cut cut cutting its way deeper into the recession. 
JOHN BOSCAWEN (ACT) 
: 
 We have just heard from Mr Cunliffe on the issue of the recession the things that are driving the recession and the Government’s response to the recession. I will come back to a theme that I have been speaking about over the last 2 or 3 weeks. Many things have contributed to the recession and I believe that one of the things that have contributed to it has been the collapse of so many finance companies as well as the losses that have been incurred by investors in those finance companies. I have publicly called for an inquiry at the Commerce Committee level and I have had tentative encouraging support from the Labour and National members of the committee. I will discuss a related issue this afternoon the collapse of the Blue Chip group of companies. 
Blue Chip as such was not a finance company but a company that was involved in raising money from the public which actually raises issues of whether it complied with the Securities Act or whether it was required to comply with the Securities Act. Many people have lost money in the Blue Chip collapse. I guess they fall into different categories. In some cases people have invested in apartments developed or built by Blue Chip and have received those apartments. Those apartments may well be worth less today than when they purchased them but nevertheless they have received those apartments. They may have bought those apartments because of misrepresentations but nevertheless they have apartments. Another group of investors have paid deposits for apartments but are yet to receive them and those deposits are being held in trust for those investors pending settlement. A number of legal actions are arising out of that. 
I will focus this afternoon on another group of investors. These investors entered into agreements to buy apartments that were to be built for them. There are three cases where companies associated with the Blue Chip group of companies sold apartments off the plans to investors and some 400 to 500 people purchased these apartments paid deposits on them and entered into agreements to release those funds. 
The CHAIRPERSON (Eric Roy) 
: I am sorry to interrupt the member but I read out the instructions at the start. Although I have some appreciation for what the member is doing Blue Chip is outside the realm of the discussion. If the member is making a comparative point that he wishes to bring back he should do that but the subject matter he is on now is outside the scope of the debate. 
JOHN BOSCAWEN 
: Thank you Mr Chairperson. I did hear your opening comments and guidance as to how the debate should run but Mr Cunliffe picked up the issue of recession. I believe that one of the issues that contribute to the recession is the failure of finance companies. I guess that was the point I was trying to make but rather than feeling your wrath on this issue Mr Chairperson I will continue with those comments I wish to make in the general debate tomorrow afternoon. 
Let us come back to another issue that contributes to the recession. The ACT Party campaigned on getting Government expenditure under control. Over the last 9 years under the previous Labour Government we saw Government expenditure increase by double the rate of inflation. Expenditure by the previous Labour Government increased by 6.5 percent per annum over the last 9 years. That increase was over and above inflation and over and above population growth and it was equivalent to $12000 per year per household or $230 per week per household. I came into this House today and heard Labour members of Parliament quibbling about the cost of a helicopter ride over Auckland by the Minister for Tertiary Education. Well literally billions of dollars were wasted by the previous Labour Government. One of the great challenges that face this country is the raising of our living standards so that citizens of New Zealand can enjoy the same standards of health and education as their friends and families who now live in Australia. The reality is that the standard of living in Australia is 25 percent higher than that of New Zealand. One of the great challenges that face this country and this Government is the raising of our living standards. 
Hon BILL ENGLISH (Minister of Finance) 
: 
 Reviewing the 2007-08 financial year in the financial review debate which is the Committee stage of the Appropriation (2007/08 Financial Review) Bill gives us an opportunity to assess just where New Zealand started from in trying to deal with the global recession. The fact is that when the National came into Government in late 2008 the economy had already been in recession for about three quarters—that is three 2008 quarters. The most pervasive problems though that the Government inherited were probably the twin chronic deficits. 
The first of those was a fiscal deficit which occurs when Government expenditure exceeds its revenue. The Pre-election Economic and Fiscal Update issued about 6 weeks before the November election showed even then before the global recession had struck that the previous Government was projecting 10 years of deficits. That was off the back of 6 or 7 years when the economy had been growing strongly. Unfortunately since the 2005 election in Labour’s scandal-ridden misdirected and hopeless last term in Government expenditure got out of control. The Government was already projecting deficits then the global recession came along in the latter part of 2008 leaving the incumbent Government with a significant fiscal problem. But that was not the only deficit. 
The other deficit was the balance of payments deficit. It is interesting that in the light of recent events no doubt many good things that were not said while he was Minister of Finance will now be said about Dr Cullen. One of the things he claimed when he came into office with the Labour Government in 1999 was that the current account deficit was far too big. At that time it was about 4 or 5 percent of GDP. That has demonstrated that New Zealanders were not saving enough. We were reliant on overseas borrowing. Well after 9 years of growth— 
Craig Foss 
: Long years. 
Hon BILL ENGLISH 
:—after 9 long years of what were probably the best economic conditions that we will see perhaps for two generations—I used to say one generation but maybe it is two generations—we ended up with a current account deficit that was twice as large as it was when Labour came into Government. That indicates pretty clearly that the growth we had during the first decade of this century was largely founded on borrowing and largely drove consumption. It is pretty clear now that in the next 10 years growth will have to be founded on savings and will be driven by exports. Those are the twin chronic deficits. The Labour Party ought not to forget that. 
One of Labour’s problems is that it still regards the result of the election as an aberration. Labour members think that one day they will wake up and suddenly they will be back in Government. They still cannot understand that their economic mismanagement was one of the many reasons that the previous Labour Government was voted out of office. I tell members opposite that until they apologise for leaving twin deficits—a fiscal deficit on the Government’s accounts and a current account deficit on the nation’s accounts—no one will listen to them. I ask how they can make any credible contribution to the economic debate when they will not accept that their 10 years of misdirected economic management left this economy much more vulnerable to the global recession than it should have been. 
The review of the accounts through to 2008 that we are doing today is almost irrelevant to the current economic debate because the economy has shifted so far in the 9 months since the end of that financial year. But these accounts do show the state of the economy as the previous Government left it. Members of the previous Government are inclined to say that they left it with record low unemployment. In fact the unemployment rate was rising consistently through 2008. In fact it rose by about 30 percent. I do not remember those members discussing that much during the election campaign. Unemployment was already on the rise that rise has continued and it is putting fiscal pressure on the Government’s accounts because the numbers are going up pretty consistently week by week. 
The game plan that the Government has been outlining for the last 3 or 4 months must focus on those twin deficits. It must get Government expenditure under control because so much money was being wasted. I must say that one thing I can thank members opposite for is that they made it easy for the Government to make savings because so much money was being wasted. 
Hon DAVID PARKER (Labour) 
: 
 We heard the Hon Bill English launch into an attack on the previous Government accusing us of being scandal-ridden. This is from the Government that in the last week has had Dr Worth on the ropes for inappropriate behaviour as a Minister whilst in India in clear breach of the  
Cabinet Manual 
 which the Prime Minister and his Cabinet colleagues including the Hon Bill English are happy to look past. He should not come to us and accuse the Labour Party of being a scandal-ridden Government and then condone that sort of inappropriate behaviour in the National Government. 
I will refer to another comment made by the Minister in the chair Bill English. He said that he had inherited a terrible set of affairs from the outgoing Labour Government. Again there is rote learning going on in the National Government. It tries to pass this disease on to the media but the media are not buying it because they know it is not true. Not only does the media know it is not true but also the IMF has reinforced it just in the last 2 weeks. The IMF says in its macroeconomic outlook for New Zealand in its report dated 23 March 2009 that “New Zealand is in a better position than most advanced countries to face the global storm given its sound macroeconomic policies including a flexible exchange rate low level of public debt flexible labor markets and healthy banking sector.” 
Hon Parekura Horomia 
: Who said that? 
Hon DAVID PARKER 
: That is what the IMF says. It is completely different from what we heard from the Minister of Finance. 
Why would the Minister of Finance try to pull the wool over the eyes of people who are listening to this debate? Why would he be doing that? It is because he knows that he is now overseeing a structural deficit that he has caused that is his responsibility and that will be his legacy to this country. A structural deficit is what Mr English has caused through the National Government’s irresponsible tax cuts. These tax cuts are not only inappropriately directed mostly towards those who are already well off but also so extreme in their amount in out-years that New Zealand has been put into a structural deficit. 
The member says that we are already in deficit. Well a deficit in out-years was projected. It was not nearly as high as the one the member is projecting and that was after contributions are made to the superannuation fund. It is very important that we keep that up to fund superannuation to people in the future. Every time National members are in Government they cut contributions to the superannuation fund. What are they doing? They are cutting the ability of New Zealand Governments to fund superannuation in the future. Let us wait for the Budget; they will be cutting those contributions. They have cut the research and development tax credits so businesses will not grow as much. They have cut the KiwiSaver generosity so there will not be as much saving. As a consequence the economy will not grow as much. 
The worst thing of all is this structural deficit that National members have created. How are they going to mask it? Mark my words they will hide this structural deficit in the Budget in a number of ways. For a start they will stop the contributions to the superannuation fund which we know are necessary to maintain superannuation. They will also drag out money from the State-owned enterprises. We had Gerry Brownlee sounding off that electricity prices were too high. We had Bill English and his colleague Simon Power saying they wanted higher rates of dividend from the energy-related State-owned enterprises. How are they going to get that? They are going to borrow hundreds of millions of dollars if not billions through the energy-related State-owned enterprises which is a one-off payment that they will use to again hide from the public the structural deficit they have created. 
The structural deficit that was left by the National Government of Rob Muldoon had high levels of Government debt. The wise stewardship of Dr Cullen and the previous Labour Government got that debt down to very prudent levels—everyone agrees with that; even Mr English agrees with that. The IMF certainly agrees with it. But the National Government is blowing out a deficit. What does the IMF say? It says that the Government cannot bridge that gap with just decreases in expenditure which is the slash-and-cut policy we see coming. The IMF says that the Government must address the issue of revenue. That is saying in other words that it has to take in more tax. This is proof that National’s tax cuts in out-years are unaffordable. The IMF said in its report dated 23 March that although the focus of the consolidation should include the expenditure side “the size of the required adjustment is large and revenue measures will likely be needed to close the gap.” I say to Mr English that the National Government’s tax cuts are unaffordable. 
CRAIG FOSS (National—Tukituki) 
: 
 I rise to speak on the financial review of the financial statements of the Government of New Zealand for the year ended 30 June last year. I speak after one or two other speakers and I would like to address some of the points they have raised that pertain to the report on the Table here. 
I will pick up the theme of an earlier speaker because once again my suspicions have been confirmed about the tax cut and election-result denying members opposite. I cannot for the life of me believe that on the one hand they say we need more money—and before the election they said their party was the tax cut party and they legislated for that because they did not trust Dr Cullen or themselves to follow through with it—but now post-election the theme of almost every single speech they give is that we should not have tax cuts; they are starting to put forward the old redistribution line. I look forward to hearing other speakers clarify whether Labour members agree with us in relation to the tax cuts put in place on 1 April this year as a result of the National Party victory at the last election. Do they agree with those tax cuts—yes or no? Do they agree with the fact that so many hard-working New Zealanders have missed out over the last few years? Yes we agreed with and signed up for Working for Families; yes we agreed and signed up for indexation of many of the benefits; but do Labour members agree with tax cuts? 
What I am hearing from members opposite right now is that they do not believe that every New Zealander from those on an average wage and higher and probably those on below the average wage should have more of their own funds when there is a surplus and funnily enough they do not believe that a recessionary environment which this Government inherited is an apt time to leave more money in the pockets of those who earned it in the first place. Listening to an earlier speaker David Cunliffe—a gentleman who apparently does not have a site on Twitter—I do not understand how Labour members say that the fiscal stimulus should be bigger and wider yet they argue against tax cuts. I cannot quite work it out and I will be interested to hear other speakers try to clarify the issue and move the clouds away from the policy because members opposite have so much time on their hands post-election. 
Last week I spoke on this issue in another debate and I made the point that the clock starts ticking for this particular Government at the end of this Budget. After the May 2009 Budget the clock will start ticking for this Government because that is what we will be judged on. We will not be judged on what we inherited—Budget 2008 the Pre-election Economic and Fiscal Update or the things that were not in it the half-year update or even the Budget Policy Statement which is an indication for the next year’s Budget. We will start to be judged on the accounts as they are put before this Parliament when the Hon Bill English presents the Budget in 2009. That is when the decade of deficits—and they are looking horrible at this moment—will be revealed. That is when the true state of the accident compensation numbers which a previous speaker started to allude to—or even to deny if I am allowed to say that—and the true state of the New Zealand accounts will be placed before the New Zealand public. Unfortunately they were not placed before us earlier. 
I acknowledge all of the members of the Finance and Expenditure Committee who helped to contribute to the financial review we have in front of us. There was some robust debate and some good issues arose from it. If members read the review they will see that there are some acknowledgments as to the state of play that was inherited by the incoming National Government. In fact many of the matters that were talked about theorised on written about hui-ed for and consulted on by the previous Government were not put in place and that is the key. Actions speak so much louder than words. 
Another member opposite kept talking about the structural deficit. I will be very interested to hear another speaker talk about that. It is obvious now that there has been a structural deficit in New Zealand’s accounts for quite some time. The risks inherent in New Zealand’s accounts have not been portrayed as accurately as they probably could and the accounts have not been portrayed as conservatively as they probably could and we will see the results of that when the May 2009 Budget is released and put on the Table by the Hon Bill English. The previous speaker also talked about the superannuation fund which Dr Cullen was the architect of—we all acknowledge that quite deliberately. 
The CHAIRPERSON (Eric Roy) 
: Just before I call the member who will have the next call I say that interjections are fine. But I ask members to look at Speakers’ ruling 61/5 which covers a running commentary. In respect of interjections the test is whether they are rare and reasonable and during the previous speech we shifted very clearly into a running commentary. I ask members to show a little bit of restraint. Interjections are fine but we will not have running commentaries. 
Hon TREVOR MALLARD (Labour—Hutt South) 
: 
 One of the problems with this debate is that we appear to be living in two worlds. One is the real world and one is a world that appears to be inhabited by the Prime Minister and occasionally by Bill English. To get right to the nub of the issue one has to ask this question: does the Government have a debt problem at the moment or did it inherit a debt problem? It is clear from the international commentary whether it is from the IMF or the World Bank and from the comments made by John Key and Bill English early in the time of holding their current positions that the previous Government did a very very good job during the time under review—and in fact for the 8 years before that—of positioning the Government and the Government’s books in such a way that we could sustain a period of downturn. 
But there is nothing like someone who suddenly becomes as Bill English is a previous position denier. It is a bit like the climate change deniers or the Holocaust deniers. He is now consistently denying the very good position that he inherited. He is someone who now knows that if he had the choice again he would not make the tax cuts that came into force on 1 April. They were wrong. They were wrong in their totality but especially they were wrong in their distribution. Part of the job is to link economic policy with fiscal policy and that is what Bill English did not do in this particular area. Fiscally he probably got it just about right but as a result of the distribution of the tax cuts economically he got it very very wrong indeed. 
I will make a prediction. Sources that are normally very very well informed have told me that on Budget night in May the Minister of Finance will not only announce but will pass through all its stages a bill that will reverse the tax cuts for the out-years. Bill English will get up in this Chamber on Budget day and say that before members are allowed to go home the Government will under urgency undo the tax cuts for the out-years—the tax cuts that we have already legislated for. 
Dr Rajen Prasad 
: He’s not denying it. 
Hon TREVOR MALLARD 
: He is certainly not denying it. He cannot deny it. He is smiling in a knowing way but he cannot deny the fact that he will either before the Budget—because clearly he will come under some pressure to do so—or on Budget night make an announcement that he made a very big mistake in legislating for the out-year tax cuts. Because of the shape of the Government debt to GDP graph he will legislate in order to make his Budget documentation slightly more believable than would otherwise be the case. If he does not do that if he does not make that announcement then it will be very very clear that the next Labour Government in 2½ years’ time will inherit a debt position that will be much much worse than any that has been inherited by any Government since Rob Muldoon handed over power to David Lange in 1984. That is the parallel that Bill English is heading towards. 
I am sure Bill English has finished making his big Budget decisions already but he is facing a very very similar dilemma to the one Muldoon faced in 1984 as Minister of Finance and as Prime Minister. He is finding a Budget that is almost impossible to write. 
CHRIS TREMAIN (National—Napier) 
: 
 I rise to take a call on the 2007-08 financial review. I will refer to a few comments from Mr Mallard and Mr Cunliffe who stood and made disparaging remarks about the Government. Mr Cunliffe said that Mr English said New Zealanders should look to the Government to show a pathway through and that is exactly what this Government is doing. It is showing a clear and decisive pathway through this recession. We are here to blunt the edges of this recession and to provide a platform from which this country can grow as world trade conditions improve and as we come out of the economic downturn. 
I want to follow up on a few of the comments made by Mr Cunliffe today. He talked about New Zealand inheriting a strong position. He said that the National Government had inherited high growth. I do not know what dreamland Mr Cunliffe lives in but to say that we came into a position of high growth is absolutely ridiculous. We all know that from 1 January to 31 March 2008 the first quarter of that year New Zealand was in a position of negative growth. I do not know how that translates into a position of high growth. The fact of the matter was that we were already in recession brought on by Labour’s structural expenses. We were already in a position—[ 
Interruption 
] That member knows we were already in recession. We did not inherit high growth; we were already in a position of negative growth. Mr Cunliffe then went on to say we were in a position of low debt. Yes I acknowledge that in New Zealand we did have low debt as a percentage of GDP. 
But let us have a look at the facts. The reality is that over the last 20 years debt to GDP in this country has dropped like a stone. The biggest drop in debt to GDP was through the 1990s where it plummeted; it absolutely plummeted. It is absolute rubbish for Labour members to get up on their high horse and say they paid back debt. What happened is that as the economy grew the debt to GDP ratio dropped. That is what happened. The previous Government did not pay back any debt; the debt to GDP ratio dropped as the economy grew. This country had some of the best economic growth in a generation created by companies in New Zealand and world trade. It had nothing to do with the previous Labour Government except perhaps the one exception of company tax rate drops which occurred late in Labour’s last term in office. Can members name another policy that really improved economic growth across this country in Labour’s 9 years in office? It was limited. 
Hon Parekura Horomia 
: You had 24 percent unemployment at the same time. 
CHRIS TREMAIN 
: The member said that we inherited a period of low unemployment and I acknowledge that. We did inherit low unemployment. But once again that was a result of the hard-working companies in New Zealand. I ask Mr Horomia to name a piece of legislation that the Labour Government introduced over the 9 years that it was in office that helped to drop unemployment in this country. 
Hon Member 
: No he can’t. 
CHRIS TREMAIN 
: It was companies that did that on the back of high growth. There was no legislation. 
I want to acknowledge through this review where National is now taking the country. We are positioning it on a strong growth path going forward and we have introduced a range of initiatives. I refer in particular to the tax cuts. As soon as we came into office in the first 100 days we introduced those tax cuts on the back of the October tax cuts that were introduced by the Labour Government. We put those in together with those from the Budget 2008. We had one of the strongest fiscal stimulus packages in the Western World—one of the top five nations. Yet we hear from members on the other side that this Government is bleating that we should be spending more and that we should be going out there and borrowing more money to provide a stronger fiscal stimulus package to put more money into our mokopuna and our tamariki to be reclaimed in years to come. We are being practical about the package that we are putting in place; absolutely practical. We are doing it in a way that New Zealanders can afford. Labour members are recommending that we go out and borrow even more money than we have to do so that we can put that cost on our tamariki going forward. 
 I ask Mr Horomia to go out and tell that to his constituency. He should tell his people that we are being practical; we are taking a conservative pathway forward and we know that we still have one of the strongest fiscal stimulus packages in the Western World. I tell the member that that is a good position to go forward with. But not only have we done that with tax cuts; we have been bringing forward our infrastructure spend. I know that in Hawke’s Bay the extension of the southern expressway—a great project—is going on there and there is work on the Matahorua Gorge which is up in Ms Mackey’s area. We are doing great things. Thank you. 
Report noted. 
Ministry of Economic Development 
Report noted. 
Ministry of Health 
Hon RUTH DYSON (Labour—Port Hills) 
: 
 I am pleased to have the opportunity to participate in this financial review of the Ministry of Health. Over the last 9 years Labour focused on investing in health across the entire spectrum of the portfolio from disease prevention to anti-obesity measures record low adult smoking rates increased screening for diseases increased immunisation rates decreased general practitioners’ fees decreased prescription charges increased elective surgery more nurses more doctors record pay increases for nurses and 33 new or upgraded hospitals from Kaitaia to Invercargill. I pay tribute to the three Ministers of Health during those 9 years: the Hon Annette King the Hon Peter Hodgson and the Hon David Cunliffe. 
At the time of the election campaign last year—well for most of it anyway not all of it and I will talk a bit more about that later—National campaigned on the slogan “better sooner more convenient health services”. That was the mantra; that was the Crosby/Textor line from the National Government—“better sooner more convenient health services”. But it is very difficult for any member of the public to be able to say now that that is what we are getting. It is very difficult for members of the public to relate what they heard consistently in that Crosby/Textor messaging—“better sooner more convenient health services”—to what they see when they look at what we actually have. 
Just today in the House for example I gave the Minister several examples of cuts to front-line services and of increased costs for accessing health services by ordinary New Zealanders who will be very very confused by the conflict between the message they heard before the election and what they are seeing now. For example I asked the Minister about his decision to allow MidCentral District Health Board to cancel its clinical services and mobile bus. How could that Minister justify the over 100-kilometre journey on a substandard road with no financial travel assistance available for the good people of Dannevirke? But the Minister had the audacity to say that that was in order to fund better services somewhere else. So the people in Dannevirke should hear that message: “You don’t count; there is nothing at all of interest to this Government in the fact that you will now be paying substantial amounts of money to travel on a substandard road often in very dangerous weather conditions when unwell already.” Obviously because of the nature of people’s visits—they are going to access health services—they are not making those visits when they are feeling 100 percent. But the Minister just said that that was all right because it meant that the Government could pay for something else. 
That response makes an absolute fallacy of the message we heard from the Minister before the election as does the fact that with the latest situation in relation to Capital and Coast District Health Board’s paediatric oncology services our children and families will once again be forced to travel away from Wellington to receive treatment. Rather than try to develop a sustainable response or look for a sustainable solution to the fact that in Wellington there were so few cases that that service would now be considered borderline in terms of providing the service and meeting health and safety measures the Minister suddenly said that it was all up to Capital and Coast District Health Board. He said that the district health board should be working for a solution and he washed his hands of it—as I am showing members now and as he did time after time in relation to health. He washed his hands of Ministerial responsibility. Suddenly the buck is to stop with the district health board. Well I want to tell the Minister that actually he is the one collecting the fat pay cheque. It is his bottom on the seat of a Crown car. He is the one with people working in his—Minister Ryall’s—office not district health board personnel. And it is with that Minister that the buck stops in regard to this vote. 
We have had numerous examples of direct cuts to front-line services. I raised another one in relation to health quite recently which was with regard to access to the mobile breast-screening unit. Previously it had been travelling the whole length of the West Coast including Buller. So the women from Punakaiki right through to Karamea who were eligible for breast screening just had to walk down the road. They just had to go down the road to get their breast screening—in fact in the very same way as staff in the Minister’s office can just walk out to the forecourt of Parliament and have breast screening in the mobile bus. But now women in Karamea in Waimangaroa in Granity and right through to Westport and all the towns in between and down to Punakaiki and Charleston have had that service threatened because BreastScreen South has built a new unit in Greymouth and it wants people to go there rather than to the mobile clinic. Well that makes sense in theory but how can the Minister justify his decision to allow the West Coast District Health Board to transfer the cost of travel on to those women in Karamea Seddonville Granity Fairdown Waimangaroa and right away through to Punakaiki? Why do those women have to bear the cost of the cuts? It is because that Minister has let the district health board do it. 
I had the local member of Parliament Chris Auchinvole running down the corridor after me flapping his arms and saying that he had fixed it: “I have now got a solution to this.” But I went and researched that and I say to the Minister and to the current member—the very single-term I think member of Parliament for West Coast - Tasman—that no solution has been found because BreastScreen South said to the women of Buller: “We will reinstate the mobile service. It will make one more visit to Buller so that women from Buller only have to go down the road for their breast screening. But we will not reinstate it permanently; we will have only one more trip north. And tell the women of Buller ‘Get used to travelling.’ ” That is a direct quote: “And tell the women of Buller ‘Get used to travelling.’ ” 
As I said in my introductory comments before the election we had a promise from National of better sooner and more convenient health services. But we have seen cuts to surgery lists on the West Coast. We have sent cuts to jobs in both the Taranaki District Health Board and the Tairawhiti District Health Board. We have seen cuts to home support services for the most vulnerable people in our community—disabled people and elderly at home in need of support—in South Canterbury and I understand in Southland as well. 
 We have lost the paediatric oncology team at Capital and Coast District Health Board. We lost then reinstated and are going to lose again the breast-screening bus on the West Coast. We have no guarantee of school nurse services in our 10 district health boards. The Minister announced a $10 million ambulance service injection which was one-third of the money that the Ambulance Services Association already had and even that pittance has not arrived yet. In fact 20 percent of the money that was committed by the previous Government for ambulance services—and not even that—has arrived. 
Today just to put the icing on the cake I exposed the fact that last week the Minister in another self-promoting move had announced that he had personally reviewed—I am sure while sitting at the bach in Tauranga—the travel service policy and now in a grand announcement said he was going to increase the funding. He said the increase would be the first one in 20 years but that comment is totally untrue. In 2005 the Labour-led Government reviewed the travel policy and increased that very fund by $36 million. The Minister was wrong in that statement. He was also wrong in his answers to a supplementary question in the House which he had to hastily adjust. It is very clear that he does not have his head around the facts of the portfolio. It is quite sad to be honest that he does not have his heart in or any passion for the portfolio. Everyone in the capital city village as it is knows that he did not want to be Minister of Health. We knew prior to the election that he wanted a different portfolio. 
Hon TONY RYALL (Minister of Health) 
: 
 The previous speaker really is struggling. What we have seen with Ruth Dyson is that she takes an incorrect media report and does a beat-up in order to try to make it the full story. For example she said there had been cuts to elective surgery on the West Coast. But the West Coast District Health Board tells us that there are no cuts to elective surgery on the West Coast. The member then told a story about all the extra money that the previous Labour Government had put into the national travel allowance. Well how come the mileage allowance of 20c a kilometre being paid to people had not increased for 20 years? That is the advice I have received from the Ministry of Health but that is not what the member said. The other week the member talked about the cancellation of the breast-screening unit in the West Coast and Buller areas and she said that women would have to travel. Today she admitted that the service is being reinstated but then she said that the unit is under threat for the next year. She really is struggling. 
Let me educate that member on what her Government’s failed administration did to the New Zealand public health system. After 9 years of doubling the health budget fewer people are receiving elective surgery on a per head of population basis. After 9 years of doubling the health budget there has been only a 0.7 percent increase in the number of people getting a first specialist assessment in a public hospital. After 9 years of doubling the health budget 180 New Zealand men and women were being sent to Australia for cancer treatment. After 9 years of doubling the health budget we have a massive health workforce crisis across the entire public health system. After 9 years of doubling the health budget a whole lot of vulnerable services right across district health boards are hanging by a thread because of the neglect of members opposite when in Government in terms of dealing with those issues. What is worse Labour members stood up and told the country that district health board deficits were only $110 million. We know that those deficits are heading to over $160 million according to the advice I received from district health boards just before Christmas. 
We know that this is going to be a challenging time in health. Not only are we suffering the effects of a workforce crisis that was neglected ignored and denied for 9 years but also we are facing the major financial challenges that are besetting this country. But the Government is taking action. Within weeks we introduced our voluntary bonding scheme which offers student loan write-offs and cash grants to doctors nurses and midwives who agree to work in hard-to-staff areas and communities for up to 5 years. We know that that will make a significant difference. We also acted swiftly to increase the number of general practitioner training places in the wider public health service and we will further increase that number next year. The Government has also announced its plan to increase the number of medical student training places in our universities next year as well. We are taking action to deal with the workforce crisis that we have inherited. 
We have also taken action to deal with some of the major issues that New Zealanders are faced with in the health service. How can the funding double in 9 years yet we end up with fewer services? Well a lot of it is to do with the unchecked massive growth in bureaucracy in the New Zealand public health system where the number of managers and administrators grew by 25 percent over that 9-year period—from 8000 to 10500. That increase is a huge burden on the public health service and it will take a while to fix the problem as we move resources from the back office to the front line. 
This Government is determined that it will not have a doubling of the health budget and fewer people getting care. It just does not make sense. This Government is determined to work with our district health boards and our front-line doctors and nurses in order to improve the services that New Zealanders have. When the Budget is tabled in Parliament in a month or so New Zealanders will see that this is a Government that they can trust with the New Zealand public health service. It is a Government that is committed to improving the services that New Zealanders receive and improving those front-line health services that are so important to our communities. 
KEVIN HAGUE (Green) 
: 
 I want to take this opportunity to take up a line of questioning and thinking that I first pursued with the Health Committee’s review of the Ministry of Health. The Minister of Health Mr Ryall when in Opposition had a particular focus on waiting times for elective surgery. Even though elective surgery represents perhaps 5 percent of what the publicly funded health sector actually does and even though it is a topic that is beset by complications because it lies across the boundary between the public system and the private system the waiting times for elective surgery make for an easy target because of the emotional charge associated with waiting for needed surgery. It did not matter to him that the often-criticised system for prioritising and booking elective surgery was in fact developed under the National Government of the 1990s. 
The health sector has watched with interest to see how a politician with such an expedient political focus while in Opposition would make the transition to ministerial responsibility for the sector. The answer is in and it is “not very well”. The politically easy targets for an Opposition politician—waiting times for elective surgery emergency departments and radiotherapy and railing against bureaucracy—have unfortunately continued to be that Minister’s focus. To compound his failure to adapt to his new role he has adopted a public style from the Joan Collins school of management: “Do it my way or you’re all fired.” 
What is at stake here is not just the Minister’s misplaced enthusiasms. There has been a bipartisan consensus around the need to greatly strengthen our programmes to keep people well in the first place through public health and to treat illness as early as possible and in the patient’s own community through primary care. This necessarily requires a relative deprioritisation of hospital-based care particularly at the most specialised high-tech and expensive end. This is not just some idea of New Zealand’s but rather reflects the common global understanding of what is required to combat in particular the rapidly rising tide of long-term conditions that will otherwise swamp health services. 
I had the greatest of difficulty in obtaining a copy of Minister Ryall’s letter of expectations for district health boards and to date I have not yet received a copy from his office. It is no wonder that is the case. Rather than continuing the practice of his predecessors of emphasising the broad strategic direction primary care merits only a cursory mention in that document. This at least is one mention more than the other issues get such as keeping people well equipping New Zealand to deal with chronic conditions and reducing health inequalities including taking action to address the national emergency in Maori health. This is important because district health boards will take their steer from the Minister’s priorities—if they do not improve radiotherapy waiting times boards will get the sack. So will the district health boards focus on that or on improving access to primary care for Maori for example? 
Nobody is arguing that improving waiting times and moving patients faster through emergency departments in order to maximise productivity and minimise waiting times are not important things to do. The fact is that district health boards have over the past year or so been placing a very great emphasis on quality improvements and workforce development to achieve precisely that. Edicts and threats may convey an action man image but they simply do not help. At some point in the not too distant future the Minister will begin to understand the complexity of the health sector. Let us hope that in the meantime the progress that has been made towards meeting the real challenges does not sustain too much damage from his desire for simplistic and politically expedient solutions. 
NATHAN GUY (National—Otaki) 
: 
 The Committee will be interested to know that the member who has just resumed his seat was the former chief executive of the West Coast District Health Board when its services collapsed. I just wanted the Committee to be aware of that. 
When we review the performance of the previous Labour Government I want the Committee to be aware that when the previous Minister of Health David Cunliffe got to his feet during question time and told everyone not to worry because he was running the show the health budget had been doubled yet services were deteriorating across New Zealand. Waiting lists were allowed to grow and bureaucracy was bloated. It ballooned out of control by 25 percent. There were 8000 bureaucrats in the health departments across New Zealand. That number grew not only under the previous Minister of Health but also under several former Ministers before that member. It grew from 8000 to 10500 which is a growth of 25 percent. The growth was not going into the front line where we want to get more services but into the middle and the back lines. The number of people who sit at desks was out of control and that will be a huge challenge for this Government to address in order to get services to the front line. 
We have some big challenges in the health sector. But I want to back up the very good current Minister for Health the Hon Tony Ryall for what he has done in the first 4 months in his job in Cabinet. He has announced a very good voluntary bonding scheme for doctors across hard-to-staff places around New Zealand. I want the Committee to think about and remember this fact: under the previous Labour Government New Zealand was the biggest exporter and would you believe this the biggest importer of doctors. How ridiculous it is that taxpayers across New Zealand fund doctors through their training to hopefully work in this country—and indeed they are allowed to have choice about that—but that doctors make the choice to leave New Zealand because we do not have the right incentives to keep them here. That is why now people across New Zealand with the 1 April tax cuts are saluting Prime Minister John Key and the National Government and saying: “Yes at last!”. They know we will create the right incentives for people to work harder and get ahead. Is it not an embarrassment that under the previous Labour Government there were more doctors leaving than staying in New Zealand? Thankfully we have a bonding scheme that will work across most of New Zealand. 
I also want to touch on the ambulance services and a pilot that will be provided by Wellington Free Ambulance in the Otaki electorates which will have more paramedics coming into my electorate. They will be looking after people in their homes in order to reduce the services that are required in Kenepuru Hospital and in Wellington Regional Hospital. A great initiative is to be piloted in the Kapiti community whereby Wellington Free Ambulance paramedics will see the sick and the elderly in my community and treat them in their own homes. I think this is a fantastic initiative. 
Across New Zealand there are a whole lot of other issues that the Minister for Health is also addressing. Right now we have to get on and we have to redirect the services provided by the district health boards. We have to focus on the front line and that is where I believe that the Minister is doing a fantastic job. I say “Well done!” to Tony Ryall for getting on and doing things in his first 4 months in office. He has had to pick up the pieces from the mess left by the previous Labour Government and to concentrate on the front-line services needed to look after the most needy people in our community. 
Hon TONY RYALL (Minister of Health) 
: 
 It is worth noting that we are talking about the 2007-08 financial review of the Ministry of Health and the period of time subsequent to that. It would be worth reflecting on the fact that during the financial year that is under review the previous Government tabled its budget for the 2008-09 year. What many New Zealanders do not realise is that in the weeks in the run-up to the general election the Labour Government stripped out $150 million from the future funding path in health. Not a lot of people know that—the Labour Government cut $50 million out of the health budget for next year and $100 million out of the indicative funding path for the following year. So a total of $150 million was cut from future health funding by the Labour Government. Not a lot of people know that. 
I give that information to the Committee because one of the biggest challenges we have inherited in the health service is dealing with a track towards financial crisis right across the district health boards. We have indicated to district health boards that although they are getting more money next year like the previous Government we are expecting them to do their level best to improve services for New Zealanders but we are also expecting them to track towards achieving a financial balance over time. But that is made a lot harder by the fact that Labour cut $50 million out of the future health budget for the next financial year and $100 million out of the budget in 2 years’ time. So Labour cut $150 million out of the health budget. 
But having said that I know that district health boards are committed to working constructively with the Government to meet the many challenges that we are facing in the district health board system. Those challenges are very significant. I reckon the biggest challenge we face concerns the workforce—workforce and workforce. The Government is taking action to deal with the health workforce crisis. Not only do we have the voluntary bonding and the increased numbers of general practitioner training places and medical student places but we are also working across the sector to try to find additional places for nursing and other surgical training. 
This Government is committed to increasing the availability of elective surgery through our plan to build dedicated elective surgery centres across the country. The premise of this plan is based on international and national research that shows that if we can split acute or urgent surgery from elective surgery then we will get much better elective surgery performance. 
Hon Steve Chadwick 
: Tell us about health and wellness not just hospitals. The member knows nothing about the value of primary health. 
Hon TONY RYALL 
: The failed and defrocked member from Rotorua says the issue is not just about hospitals. I have to tell the member that the Government has made it clear that commitment to the Primary Health Care Strategy is important and remains bipartisan. But that is no excuse to allow the intolerable performance that patients have been receiving from our public hospitals in terms of the delays and the frustrations they face. 
That is why the Government is telling cancer patients that it wants to improve cancer treatment waiting times in New Zealand. That is why we are saying to the many patients who front up at emergency departments that we want to improve the timeliness of emergency department performance in New Zealand. That is why the Government also says to the many patients who languish on hospital waiting lists that it wants to improve access to elective surgery. We make no apology for saying that because the message of the election—which the Labour Party never got—is that New Zealanders want improvement in those areas. New Zealanders do want cancer patients to be treated faster than they are currently. What is peculiar is that Mrs Dyson gets up and asks what we are doing about paediatric oncology but in her next breath she asks why we are telling the hospitals to concentrate on cancer treatment waiting times. It does not make sense. That is why she is struggling in her role as the Opposition spokesperson on health. 
 The Government has made it clear that although bipartisan commitment to the Primary Health Care Strategy remains important and we are committed to it we need to improve the waiting times in our public hospitals. The Government is doing that. We have made it very clear to district health boards that we want to work constructively with them to do that because we cannot have a situation where the budget has doubled and the level of service has dropped which is the record of the party opposite when it was in Government. I suspect that what New Zealanders really want from members opposite is an apology for Labour’s performance while running the New Zealand public health service over the last 9 years an apology for neglecting the areas of great priority to New Zealanders and an apology for the fact that those members still cannot accept that failure. 
Report noted. 
Department of Corrections 
Hon CLAYTON COSGROVE (Labour—Waimakariri) 
: 
 This is an interesting report. I note—because we are also discussing current operations—that the Minister in the chair has adopted on coming into Government a very interesting strategy. The Minister inherited when she came into Government an escape rate from prison that had dropped by 84 percent over a decade. The Minister of course took the credit for that as she went around and told us that she had visited a number of prisons—not to propose measures that she ought to put forward but to ask people how she should do her job. As we have noted in this House under the previous Government there was an 84 percent reduction in prison escapes. If members look at the litany of escapes suicides and assaults that have occurred in the 3 or 4 months since this Minister took office—we will not go into the area of the police because sadly we are not in the position at this point to debate the financial review of the New Zealand Police—we can see that there have been more escapes in that time than there were in the last 3 years. 
This Minister has embarked on a very interesting strategy but I think it will be seen as having been fraught with danger when we review it in the coming years. She paraded around the country and was going to be the tough person. She was the Minister who was going to crack down on everything including when the Auditor-General delivered a very robust report that outlined that procedures in the Department of Corrections had not been put in place. The department failed to do this even though it had been instructed to do so under the previous Government and even though the Wellington Coroner reviewed those procedures and had no recommendations to make because—in his view—the procedures were there and were up and running. This Minister said she would sort that out. On the back of the Auditor-General’s report came a thundering from across the House from Judith Collins. She said heads would roll—members may remember that the Prime Minister was into that as well as her—and there would be accountability. The chief executive officer of the Department of Corrections was put on notice; everybody was put on notice. 
But I will give the Minister credit for this: she did quite rightly call in the State Services Commissioner the employer of the Minister’s chief executive—he reported direct to her—and ask the commissioner to do a report that would tell her what was going on and who was accountable. But prior to that the Minister bagged and gagged the chief executive officer of the Department of Corrections so he could not respond to the Auditor-General’s report. She also pre-empted the report she had asked for from the employer of course. The Minister then put taxpayers’ money in jeopardy. We know this because the chief executive officer told the Law and Order Committee that he had not ruled out legal action at least at the time in respect of his employment arrangements and that would have been a cost to the taxpayer. When the report came out the chief executive officer said he was staying. The Minister stated that she had no confidence in the chief executive officer before the report had come out and no confidence in him after the report came out. 
The question we have for the Prime Minister is who is accountable? The New Zealand people sit there and hear a lot of bluster and bluff and stomping of feet from the Minister. She stomped around the country and said she would get tough and sort the department out. But is the Minister accountable today? Is the chief executive officer accountable? Of course the New Zealand people sit there and wonder who is accountable. The report notes a very interesting thing. It says under the accountability section—I know National members wanted this to be included—that New Zealand Labour Party members asked extensive questions about the working relationship between the Minister and the chief executive. The working relationship goes straight to the heart of public confidence in this department. I say to the Minister as she embarks on her strategy and tries to make a case for private prisons that if she cannot get accountability out of a department that she has direct control of via her chief executive officer—a single report—then how on earth will she get accountability from a private sector organisation with a contract that is far removed from that relationship and in a situation where the chief executive must participate in the tender and also decide effectively who gets the tender? I ask that Minister how on earth she will get accountability because she cannot get accountability now. 
Is this just a case where Judith Collins will be able to say—as she says when anything goes wrong in her departments whether it is in respect of the New Zealand Police or the Department of Corrections—that it is an operational matter and she will wash her hands of it? It was not an operational matter when Labour was in Government according to the speeches that National members made. Not only will it be an operational matter but it will also be a matter that is in the hands of the private sector if the Government goes down the way of contracting with a private sector company. The relationship with the company will be far removed from the Minister. I ask members whether the Auditor-General will be able to investigate such a company in the way that he did in the case of the department or whether the select committee will be able to do so. I ask whether this Parliament will be able to call people in and question them and whether the Official Information Act will be able to come into play. As we were told at the select committee we will now have a layer of highly expensive monitors who will do the Minister’s job and monitor the performance of this department. 
Hon JUDITH COLLINS (Minister of Corrections) 
: 
 When we took over the Department of Corrections we were left with somewhat of a mess in some areas. This department had five Labour or lackey Ministers in the corrections portfolio over those 9 years. Frankly there is a roll-call of shame. I understand from the department that there was a general feeling that things did not really need to change because staff outlived their Ministers. Well we have news for anyone who holds that view. 
I have read the Law and Order Committee’s financial review of the department and I noticed that a very large transcript of the evidence is contained in it. I cannot see anything there to suggest that the Hon Clayton Cosgrove or anyone else in the Labour Party really seemed to care very much about what had happened in the department during the term of the financial review. The entire transcript seems to be nothing much more than a case of the Labour members trying to make something of the fact that I actually require accountability in the department and that the department is delivering on it. 
Hon Clayton Cosgrove 
: You stomped around but you didn’t get any accountability. 
Hon JUDITH COLLINS 
: The member is making all sorts of comments about stomping and he has previously said “strutting”. Well I do not stomp and I do not strut but he does. 
The report of the Auditor-General was extremely damaging. It said that despite all of the assurances that Phil Goff the previous Minister and the current Leader of the Opposition had made to the coroner’s office and to everybody else—to the public and to this House—the recommendations had not been implemented. There are 20 recommendations from the Auditor-General. In essence those recommendations say to the department that it must follow its own procedures. So what we have had to pick up is a mess. To be fair the department had been given an awful lot more work to do without the proper funding and resourcing to do it. As late as September last year after the department had all the responsibility for community sentences forced upon it it had an emergency situation on resourcing and what was Phil Goff’s reply? One might wonder—there was no reply. He did not even acknowledge that that request had gone through. It is appalling to read this financial review and to see that so much that had been promised had not been done and certainly that the department had not been properly directed by a Minister who was not really engaged in being a Minister. 
The department tells me that not one Labour Minister ever attended a graduation ceremony for corrections officers. Not one of them took a personal interest in what was happening in that department and not one of them ever required the department to change its culture. That is what we have inherited. 
The member has made all sorts of comments about escapes and those sorts of things but since I have been the Minister there have been three escapes from corrections facilities—three escapes. In the 4½ months before then there were nine. That figure has kept the member very quiet has it not? He does not really want to talk about that. 
When I have been going around the prisons and asking prison officers what is needed they have talked to me about prisoner and officer safety about some of the problems they have and about the regulations that need to be sorted out. I have listened to that and some of those proposals are being proceeded with now because this Government listens to what departmental officers are saying. 
When it comes to issues about rehabilitation and reoffending the statistic is that about 70 percent of prisoners reoffend within 4 years of leaving prison. I do not think that any Government should be proud of that statistic and particularly not a Labour Government that was in office for 9 years. I do not think that Labour members should be proud of the fact that 8500 prisoners are locked up right now at this moment or that the corrections system has to deal with 40000 community sentences. I think it is appalling that not enough has been done in terms of rehabilitation. 
I am extremely pleased that under this National-led Government we are working with the Maori Party. We have Dr Pita Sharples as the Associate Minister of Corrections and I am talking to him about what he is doing. He is addressing the Maori reoffending and rehabilitation issues. I think that it is incredibly important to bring Maori into the debate on this issue because 51 percent of our prisoners are Maori. Labour had 9 years to deal with this issue and all it did was to fill up the jails. 
SANDRA GOUDIE (National—Coromandel) 
: 
 I am delighted to follow the Minister in the chair Judith Collins who is doing an excellent job of showing the leadership that is required in the Department of Corrections. That leadership just was not there under the previous Government. We had 9 long years and what happened? It all went backwards. Not once did Labour members show a level of concern about what was happening in the Department of Corrections. They were far more interested in engaging in character assassination during the financial review of that department. We have only to look at the reoffending statistics. If members of the previous Labour Government had really looked at those statistics then they would have seen there was a problem that they needed to address but they did not. 
It is stated in the Auditor-General’s report that the chief executive and the department were telling the Minister that there were problems; the Labour members had only to read it. If they had listened at the time to what was being said then they might have addressed the problems. After the death of Karl Kuchenbecker corrections officers had to ensure that offenders complied with the particular requirements of their sentence or order and ensure that staff complied with Community Probation and Psychological Services procedures. This posed a significant cultural shift for some staff that could not be underestimated. The Minister of the day was told that at the time—and I understand that that Minister was Phil Goff the current Leader of the Opposition—but he was not listening. He did not take on board that advice and he did not recognise that it was a significant issue. 
So what did we end up with? We have 20 recommendations from the Audit Office and I will just run by members one of those recommendations. I will look at recommendation No. 11 which is that the department completes the required reintegration checklist during the first week of an offender’s period on parole. If we look at the reintegration of offenders into the community we see the report states that out of the 100 files that were examined the department did not complete the checklist fully for 19 offenders and for 30 offenders their probation officers had not determined the actions needed to address the reintegration needs that had been identified—and there is a whole list of reintegration needs. What happens if we do not address those needs and give support for reintegration into the community is that offenders reoffend. All the Minister at the time had to do was to look at the reoffending statistics and to ask himself what the problem was. He was being advised by the department at the time and that is made quite clear in the Auditor-General’s report. 
The report also goes on to state in another part that over the course of the development and implementation of the new community-based sentences introduced by the previous Government that Government had introduced a policy that it had undertaken no planning for. It had made no analysis of the future impacts of that policy. That Government had not given any consideration to the effect on the department or its staff of the whole cultural shift in the way in which the processes associated with offenders and their treatment were to be managed. All of that just compounded. The Minister at the time was told that this was a serious issue and that it should not be underestimated. That was the previous Minister Phil Goff who is the current leader of the Labour Party. He did not listen to that advice. 
Well there has been a whole new change in the department and I have to tell members that it is due to the excellent Minister Judith Collins. Finally someone is sitting up taking notice and saying—along with the Associate Minister of Corrections Dr Pita Sharples—that change is happening. We will not dump on the people who are already in that department. We want to get in there show some leadership and make a difference and Judith Collins is making that difference. The department welcomes that change. From those on the shop floor right through to the chief executive people welcome that change. They are welcoming the interest being shown by the Minister. There were five different Ministers of Corrections in the previous Government which shows us that no one really cared. Well I tell members that National cares about what is happening in the department. We will make a difference. Under the leadership provided by the Hon Judith Collins we will make that difference. When Opposition members decide that they want to take another call to start having a go at the department they need to think about what is happening in the corrections system really care about what is happening there and care about the fact that reoffending went up under their watch. 
Hon CLAYTON COSGROVE (Labour—Waimakariri) 
: 
 I was not going to take another call but that was an outstanding contribution by Sandra Goudie. I just want to touch on two— 
Sandra Goudie 
: Thank you Clayton. 
Hon CLAYTON COSGROVE 
: Oh it was outstanding and it will be etched in the annals of the House. The Minister in the chair Judith Collins made a couple of interesting statements. 
First she said that she was ashamed at the number of prisoners who are incarcerated in our prisons and I agree with her on that. Our imprisonment rate is the second-highest in the world per capita I think. But I have to ask the Minister whether she is the same member who in Opposition paraded in this House every day along with Simon Power saying to the then Labour Government that we had not locked up enough offenders. After building four prisons and after having more prisoners locked up—as I said we have the second-highest imprisonment rate per capita in the world—she said we had not locked up enough offenders. 
Sandra Goudie 
: They keep reoffending; that’s why. 
Hon CLAYTON COSGROVE 
: The “Orange Roughy” over there who spoke before me said every day in Parliament that our Government had not locked up enough offenders that we had been too soft and that there were not enough offenders kept inside our prisons. 
But now the Minister has had a road to Damascus experience where she has come in and is trying to portray herself as some sort of Mother Teresa - like figure within the National Government—some sort of humanitarian. I am waiting for the crocodile tears that she was so fond of turning on occasionally in this House when she says she thinks it is a shameful thing that we have so many prisoners in prison. I agree with her on that but there is a word for that sort of statement. It begins with “h” and she knows what it is. She cannot have it both ways. 
Second Judith Collins is a Minister who has demanded accountability. She has demanded accountability from the chief executive and he is still there. She has demanded accountability from the staff and they are all still there. She has demanded that heads should roll and people in the community sat back and watched after the Auditor-General’s report came out—and it was a damning report—and after a report that she called for from the State Services Commissioner in his capacity as the chief executive’s employer was released. She is a Minister who would not express any confidence before during or after that analysis and a Minister who said there would be accountability. I ask the Minister who is accountable after an expensive series of reports and after her bluff and bluster. She wandered around like some sort of female Clint Eastwood in the OK Corral. She was going to sort the situation out and she was given a nickname in this House that I will not use but I ask her who is accountable. I say to the Prime Minister that I do not mind who goes—whether it be somebody from the department or whether it be the Minister—but the Minister demanded accountability and we are still waiting to see it. 
I put this to the Minister. I asked her this question and she would not put a number on it. During  
Q+A 
 on 29 March she was asked by Guyon Espiner “…you’re a Minister who’s demanded accountability from others how should we judge you in terms of your Corrections portfolio …”. It is a good question I would have thought. As we roll into an election in the next 3 years people will want to know that. The answer was “I like to think ah that after my term as corrections Minister that we will have less recidivism we will have fewer prisoners who are taking drugs in prison and we will have fewer assaults on staff and other prisoners”—and I assume but I paraphrase fewer escapes. But when asked by people to put a number on that to tell them what “less” and “fewer” meant and how they should judge her—because she is the accountability queen of Parliament—would the Minister put a number on it? Oh no! Would she assist the New Zealand people in enabling them to judge her? Is the number 1 percent or 10 percent or 90 percent? What is it? Apparently it is “less” and “fewer”. 
I say to the Minister that she has been hoist with her own petard her own rhetoric and her own Dirty Harry Clint Eastwood - type impression that she is going to get tough on everybody: the police and the Department of Corrections. She said she was going to demand accountability. Sadly—or not sadly from our point of view—she had egg all over her face after report after report came out. National said it was going to do away with bureaucracy but we were told in the Law and Order Committee that there is now to be a very expensive layer of monitors to monitor the performance of the Department of Corrections. I think Iain Rennie told us that some of those people will be brought in from overseas. So now we are to have the Auditor-General’s office and the State Services Commissioner who apparently are not responsible or accountable and the Minister who apparently is also not accountable and responsible— 
Sandra Goudie 
: No he is! Clayton Cosgrove is. 
Hon CLAYTON COSGROVE 
: We have the “Orange Roughy” who says she is not accountable or responsible and now we will have a very expensive group of monitors to do the Minister’s job for her. 
In the next couple of years I look forward to re-rehearsing the statements that the Minister has made. The petard is high and she will be hoist with it. 
DAVID GARRETT (ACT) 
: 
 I understand that this debate is supposed to be a financial review debate; it seemed to be about anything but during the speech from the previous speaker Clayton Cosgrove. 
I pay tribute to the Minister of Corrections Judith Collins for her willingness to look at different options in order to save the taxpayer money in this difficult time which I understand is what this debate is meant to be about. I applaud her confirmation that we have seen the end of underfloor heating plasma TVs and other luxuries for prisons and prisoners. 
Mahatma Gandhi once said that a civilisation or society is judged by how it treats its most vulnerable people. The members over the other side may be very surprised to hear that I applaud that statement and agree with it. 
Hon Clayton Cosgrove 
: Would you repeat that? 
DAVID GARRETT 
: I will repeat it. Mahatma Gandhi once said that a civilisation or society is judged by how it treats its most vulnerable people. In my view the most vulnerable people are the hard-working mums dads and pensioners who have worked all their lives—the former being taxed the latter having been taxed—to fund hotel-style facilities for the scum of our society. Getting rid of those luxuries will save taxpayers millions of dollars and more important will send a message to criminals that their lawbreaking will no longer be rewarded by a cushy year or two in jail—and that is only if they already have a lengthy record. 
I also applaud the Minister for her initiative in introducing prefabricated prisons at a cost of about half what we have been spending and without $3 million sculptures for example signifying spiritual rebirth or some such nonsense one of which I understand is at a recently built prison. Prefab prisons are currently in place in many countries around the world and they operate successfully when measured on how many escapes they have and cheaply. 
Under the previous Labour Government prison beds cost approximately $643000 each. That is enough for three homes per bed. Prefab prisons will cost half that and that is still too high. Further luxuries can be cut and further savings can be made. 
I read with much interest a recent report about the Idaho State Correctional Institution. It is a prison that holds some 1500 inmates. There has never been an escape from that prison in 20 years—not one escape. Why is that? Does it have additional electric fences and guard towers manned by dozens of armed guards? Does it have state-of-the-art expensive laser or motion detector systems? Well no it does not. It has several secret weapons three of them called Cookie Bongo and Chi Chi. They are dogs. They are German Shepherds and Rottweilers that patrol the space between the inner and outer fences. Not surprisingly inmates are somewhat wary of scaling or even going anywhere near those fences. 
The cost of that programme for 36 dogs is $100000 a year including food and veterinary care. It saves hundreds of thousands of dollars for the people of Idaho and it has a 100 percent success rate with a reduced risk to the public. From my knowledge of the Minister in the short time I have been here I am sure she will be very interested in the further information I can provide her with on that programme. It is a very common-sense and cost-effective approach to the corrections service. I am very hopeful that with the Minister’s vision more savings can be made and I look forward to seeing them. Thank you. 
Hon JUDITH COLLINS (Minister of Corrections) 
: 
 Mr Cosgrove asked some questions in his speech. He asked who is accountable. It is great to have an Opposition spokesperson who never reads his papers. If he had read them he would have seen that the report from the State Services Commissioner says quite clearly that “The chief executive is accountable for the performance of the Department.” If only Mr Cosgrove could read! 
He also made some other allegations; he alleged that when in Opposition I was the spokesperson on corrections along with the Hon Simon Power. Actually I was the spokesperson on welfare. I had nothing to do with the corrections area. Mr Cosgrove said that I said that heads would roll. I never made that statement and I challenge that member to table the evidence. He is very good at making allegations and at character assassination but he never ever fronts up with the facts because he unfortunately never reads his papers. Mr Cosgrove should do his homework before he comes to the Chamber. 
I think it is extremely important that we look at the fact that this financial review is a review of the 9 failed years of a failed Labour Government. That is exactly what this financial review is. How can members of a party possibly stand up and be proud that we incarcerate more people than ever before that at the moment 8500 New Zealanders are prisoners in our correctional facilities and that we have to police 40000 community-based sentences? After 9 years how can any party be proud of that? Frankly I think that is a shocking statistic. 
I also think it is shocking that the previous Labour Government never really dealt with rehabilitation. That is why it is great to be part of a Government that has promised to double the number of rehabilitation programmes available to our prisoners. If we just continuously lock up people and Maori in particular—which is what the previous Government did; no wonder its members never want to talk to iwi or to the Maori Party about prisons—we will end up with more and more people completely disconnected from society. We will end up with a more violent society and more people will feel that they are not part of society and that they do not have to care about society. That is one of the most appalling tragedies of Labour’s legacy. What Phil Goff did first in justice and then in corrections and what Annette King did in police was all about locking people up and throwing away the key. Time and time again that was all it was about. 
I am completely in favour of proper and truthful sentences that mean what they say. In 1999 Labour campaigned on tougher sentences. In Government it increased all sentences but then it brought parole eligibility down to one-third of the sentence. That shows us how truthful those members were about sentences. They told untruths about what they would do. 
Mr Cosgrove asked how the public will judge what Labour has done. I think the public has judged it—the public threw Labour out. Frankly the public would be even more likely to throw Labour out if there was another election today. The public has had enough of Labour. It has had enough of Labour’s carping and whingeing and it wants something positive. Do I ever hear anything from Mr Cosgrove about what positive steps we could take together to actually help prisoners get rehabilitated? Do I ever hear Mr Cosgrove saying that he has learnt about a great rehabilitation programme and he would like to share it with me? No; Mr Garrett does that but Mr Cosgrove does not and I think that speaks volumes. It speaks volumes because this Government is committed to rehabilitation of those prisoners who will be rehabilitated—let us not kid ourselves that everybody will be rehabilitated. 
I find working in corrections a great opportunity despite all the problems it has and the fact that it is dealing with 8500 prisoners in jail plus all the others. It has a lot of problems but we have to expect that because corrections staff deal with some of the worst people in New Zealand and sometimes things will go wrong. People who work in corrections are good-hearted people. They are really enjoying having direction and having a Minister who cares about them who turns up who goes to what they want who gives them talks about things and who listens to them which is something that never happened under the previous Labour Government. Labour members never listened to people on the shop floor because they do not respect the corrections officers. They have never respected the corrections officers; they have always talked down to them. They have never listened. 
I think one of the good things in corrections is that we have change. 
Report noted. 
Ministry of Education 
Hon CHRIS CARTER (Labour—Te Atatu) 
: 
 I rise because I care about education. Labour cares about education. In the financial period we are discussing much of the time was actually under a Labour administration and I of course was privileged to be the Minister of Education; we had much to be proud about. Education funding under Labour doubled from over $5 billion to over $10 billion. We saw $3.4 billion go into school property. We saw 20 free hours for every 3 and 4-year old in this country. We saw teachers’ salaries go up by 37 percent and principals’ by 42 percent. We saw interest-free loans for students. We saw tremendous things happening in our education system. We saw an education sector that was optimistic progressive and innovative. We saw a new curriculum come into our primary and intermediate schools. We saw the National Certificate of Educational Achievement refined and improved constantly. There was a sense of optimism in education. 
But what has happened since the election? What has happened since National took charge of education? I have to tell members that I have continued to visit schools as I did regularly as Minister of Education and I am hearing a lot of fear and concern. There is a sense that things have been frozen that things will be cut and that resources will be reduced. There is not a sense of direction any longer. 
I think of my own area of west Auckland and of two projects that were signed out last year. One of them is the Waitakere learning plan which I understand the new Minister of Education will be meeting principals of west Auckland to discuss on 16 April. They were told last year they had $100000 to develop this learning plan across some 93 schools. They had the money signed out and ready to go but were then told it was frozen. We also had the Waitakere Zero Tolerance to Truancy initiative which got a letter from the ministry stating that yes it had $80000 because truancy is an important subject. We heard a lot from the present Minister of Education Anne Tolley when she was in Opposition about how important it was to address truancy and that is a really great project. The project got a letter in early November stating that it had the money and ads were run on Flava the most popular youth radio station in Auckland. The project now has $4000 worth of bills and organisers have been told that the money is frozen. 
We have also been told that the kindergarten teachers collective agreement has now expired and the ministry has not received instructions from the Minister even to begin negotiations. But we did hear in this Chamber an admission from the National Minister of Education Mrs Tolley that pay parity was no longer a given. That is incredibly alarming. 
Hon Anne Tolley 
: No I didn’t say that. 
Hon CHRIS CARTER 
: I heard the Minister say she did not say that. I say to her that she should check  
Hansard 
 because she said that nothing was on the table. Mrs Tolley said that pay parity was not a given. That news was received in the whole primary sector with enormous alarm. 
We are hearing everywhere in education that people are confused about the direction of the new Government. You know we heard so much before the election about how there would be no staff cuts and that any increases in education funding would be met by a reduction in bureaucracy. What a joke! We know of course that in terms of getting rid of a few bureaucrats the Ministry of Education was pretty lean and mean already. I remember answering a question in this Chamber as Minister for which I had asked the Secretary for Education to give me the figures for the entire pay package of every single bureaucrat in the ministry—from the secretary’s own salary to that of the cleaner who helped clean the building—and to add up all the figures. The sum came to $23000 per school in New Zealand. It is no wonder that teachers mostly voted Labour and I am sure that 99.9 percent of them will vote for Labour next time because they have been conned. 
What is happening is that stuff has been frozen. Stuff has been canned. The $1 million for the Manukau Institute of Technology to build a campus on the old intermediate site at Bairds Road—so we could address the real issue of underachievement and the transition between school and work—has been canned by Mrs Tolley. We have been told that the deal for the nine schools in South Auckland that had agreed to have early childhood education on site has been canned yet we have had so many crocodile tears from Mrs Tolley about how Manukau City desperately needs more early childhood education sites. And I agree with her absolutely. When I was Minister I asked what the biggest problem was. It was the cost of land. We found the sites but she has canned the deal. What sort of message does that send to the education sector? 
ALLAN PEACHEY (National—Tamaki) 
: 
 Was that speech we have just heard from the previous Minister of Education Chris Carter a contribution to a parliamentary debate or a eulogy for a failed Government? For the entire 5 minutes— 
Chris Tremain 
: It was a eulogy for a failed Government. 
ALLAN PEACHEY 
: I agree with Mr Tremain that it was a eulogy for a failed Government. In 5 long minutes—replicating the 9 long years of a Labour Government—Mr Carter did not mention once that during the 9 years of the Labour Government not one extra New Zealand child learnt to read write or do maths. The tale that has bedevilled New Zealand schooling for so many years remains. 
The previous Minister skirted right across that issue. But the good news is that New Zealand parents and their children can look forward to a brighter future. They can at long last look to the prospect of this country being very very clear about the standards of reading writing and mathematics that they will have to achieve if they are to find a productive role as adults in the New Zealand community. 
There is a very important underlying message here that for 9 years the Labour Government ignored. All children are expected to and can learn. The 9 years of excuses for why some schools are failing and for why large numbers of children are not learning the social deficit theories and all that sort of nonsense is now in the past. The New Zealand schooling system under the current Government and the current Minister is moving into a new era—an era in which children will be expected to learn and in which they their families and their schools will be held accountable for their learning. For the first time in many many years parents will have a very clear definition of what their children should know and the extent to which they know it. 
Sue Moroney 
: They have that already. 
ALLAN PEACHEY 
: Oh somebody is interjecting from the other side of the House saying that we have that already. Perhaps that member would like to take a call and explain to this House why between 20 and 35 percent of our children are not learning the basics of reading and mathematics. Why is that? The Labour Party has never ever been prepared to face up to the reality that too many of our children are not learning and are not being expected to learn and that schools are not being expected to teach what our young people need to know if they are to find profitable roles in our community in the future. Members opposite do not want to talk about that because their mindset has been so set in this business of making excuses. We know that as long as we are prepared to make excuses— 
Hon Steve Chadwick 
: Not on education. 
ALLAN PEACHEY 
: There are members on the other side of the House who clearly understand this issue and who have a proven track record in not accepting excuses for failures in schooling. It is just a shame that a few more members opposite do not get the point. 
The future for our children lies in the quality of schooling that they receive and that will be enhanced by the move to national standards and to clear simple reporting to parents. Of course the big challenge that the Government will face is what it will do about those youngsters who are not meeting the required standards but at least for the first time we will have got rid of the excuses and put expectations in place. 
Hon MARYAN STREET (Labour) 
: 
 I rise to speak about tertiary education in particular because it is an area that I feel really strongly about. I am concerned at the lack of grip the Minister of Education seems to have on this part of the education portfolio. Tertiary education will be the vehicle by which we recover rapidly from a recession. More than any other single component in the New Zealand economy this will be the vehicle by which we upskill the labour market existing and future and prepare the labour force of the future to participate in order to assist the economy to recover from recession. 
I want to raise a couple of points of concern about tertiary education. Given that it is part of my professional background along with others in this Chamber I have a particular attachment to the tertiary education provided through the universities as well as that provided through polytechs private training establishments independent tertiary institutions and the industry training organisations in their capacity as a link between skills in the workplace and the training that is required to provide those skills into the economy. As part of that concern I have a concern for the students who participate in tertiary education and who are represented by a nationwide students association. Those students have been trying for many weeks—in fact for 4 months—to get an appointment with the Minister to talk about issues that relate to tertiary students and their prospects as well as the current hardships that they are experiencing largely because of a decline in the number of jobs in the labour market. 
In an article that has gone far and wide across a number of student newspapers students said on Monday 16 March: “Tertiary Education Minister Anne Tolley last week wasted $400 of student money when she failed to keep an appointment with national tertiary student representatives.” The article further stated: “NZUSA had sought a meeting with Tolley since she was appointed and even invited her to address their January conference but ‘it’s taken her four months to get back to us’.” Students then embarked in this article on what they called “The Great Tolley Hunt II: The Sound of Silence”. It has been very difficult for the students to connect with the Minister for Tertiary Education but finally they did. Students have made that information available in subsequent university student publications notably  
Salient 
 on Monday 30 March where students said “Success in the Great Tolley Hunt”. The article stated: “The Great Tolley Hunt has finally achieved some success thanks to Jackson Wood editor of  
Salient 
.  
Salient 
 managed to do what all of us in student media thought impossible and get Tertiary Education Minister Anne Tolley to respond—sorta—to some questions.” 
The article then goes on to say that “National’s policies concerning tertiary education have done little to prove that Tolley understands the complexities of the university system.” Certainly it is a complex system. I do not dispute that for a moment but axing jobs from the Tertiary Education Commission is not the way to get a handle on the tertiary education portfolio. It is not the way to get a handle on the complexities of what is a very complex portfolio. It is very clear that money is of no consequence to this Minister. Obviously $400 means a lot to the New Zealand University Students Association. I wonder whether $1800 to run a helicopter from Auckland International Airport across the expanding empire of the Auckland University of Technology or whatever it was that she was viewing with the helicopter going into the central business district and down to Mechanics Bay was also a worthwhile use of public money. 
RAHUI KATENE (Maori Party—Te Tai Tonga) 
: 
 Less than 2 months ago the latest education report to hit the news gave rise to two shocking but unsurprising facts. The first was that nearly 40 percent of Maori students left school before turning 17 a whole 10 percentage points more than the national average. The second was that most Maori students—56 percent—leave school before completing the second level of the National Certificate of Educational Achievement compared with 34 per cent of all learners. That is a gap of 22 percentage points. Those facts are shocking because they reflect high levels of disengagement and a subsequent impact of low achievement and unsurprising because well tell us something new. 
Nga Haeata Matauranga 
 the annual report on Maori education of 2007-08 puts into print ideas that should be well known to all members of this House by showing a level of systemic dysfunction that no one can ignore. Yet when we turn to the 2007-08 financial review of the Ministry of Education it appears that the dysfunction continues.  
Nga Haeata Matauranga  
revealed that Maori learners are three times more likely to be stood down suspended excluded or expelled than their Pakeha peers and are a massive four times more likely to be frequent truants. 
The section on truancy in this financial review then tells us “the most recent attendance survey undertaken was in 2006—a survey had been planned for 2008 but was not carried out as deficiencies that had affected the 2006 survey had not yet been addressed.” That is shocking. There were 2 whole years to address the deficiencies and the small matter of whether we are talking about 30000 or 3000 children missing from school. Is that not something that the Ministry of Education would want to get right? All studies show consistently that students who are truant not only miss out on school work and have their educational achievement affected but also run the increased risk of becoming alienated from the educational system and of dropping out of school. 
In the ministry’s own research officials point to data from the Smithfield project which revealed that student attendance during year 11 was one of the most significant variables affecting student achievement in senior school. If that is not bad enough longitudinal studies of Christchurch and Dunedin children from my electorate of Te Tai Tonga produced evidence that truancy was a strong predictor of violence later in life and predictive of delinquency substance abuse suicidal risk and unemployment. 
 The Ministry of Education’s performance on truancy fails to provide me with the confidence that it is truly committed to addressing the measures of participation such as retention early leaving exemptions suspensions expulsions exclusions and truancy. We in the Maori Party really want to see that happening today. However one bright moment in the 2007-08 review of the ministry was the brief section on Te Kotahitanga. The Education and Science Committee described this project as being aimed at addressing under-achievement in Maori students in mainstream schools. I would however like to point out the obvious: although under-achievement—and for that matter truancy rates—reports on the performance and situation of individual students the failure we are observing is a failure of the education sector to succeed in actively engaging all of its learners. Without engagement achievement will not follow. 
We must do better as a nation to confront the poor performance of schools in engaging and retaining Maori students. Te Kotahitanga is one of the projects that we hope will make the difference—and we know the influence of the Hon Pita Sharples as an Associate Minister of Education will be particularly important in revitalising the focus on Maori achievement. And a critical part of making the difference is in the quality of staff that we have to actively engage with whanau hapu and iwi in the improvement of outcomes for Maori students. 
Last Friday I had a fantastic morning with the Maori students at Aranui High School in Christchurch which showed me that our young people succeed when the programmes are tailored to their needs and when it actually matters to the school that the learning is both meaningful and relevant. 
CATHERINE DELAHUNTY (Green) 
: 
 Tena koe Mr Chairperson. Tena koutou katoa. This is my first opportunity to reflect on the Ministry of Education and the Education and Science Committee’s reporting experience. As a very new member of a select committee I have been fascinated by the ritual of accountability that we call financial reviews. Very well-dressed and understandably defensive officials present us with glossy reports. In between the outcomes and outputs—blah-blah-blah—there are issues of the wise use of resources but I am not sure whether we get close to that conversation. 
What really matters to the Green Party are the questions behind the financial reviews. Such questions are to the Minister and they ask who benefits and what is changing. It is nearly 20 years since Tomorrow’s Schools was foisted on to an unsuspecting public under the guise of greater parental involvement and soon it will be time to acknowledge that this particular emperor is damn near naked. 
We now have a system where half the class in any given State high school goes to Paris for its school trip while the other half is lucky if it gets to go to McDonald’s. As Professor John O’Neill of Massey University recently said in his speech to the Quality Public Education Coalition: “Agreeing to use money”—which he is referring to in terms of monetarist values—“in schooling as we have done since 1989 destroys the idea of education as a public good where benefits are owned and shared equally by everyone. Introducing money creates the idea of education as principally a private good the aim of which is to create personal wealth through the buying and selling of educational commodities or services. This is commerce not education.” 
I know that some people in the House think that everything is commerce and that the creeping privatisation of the education system is a logical manifestation of the sacred concept of choice. The strange thing is that poor whanau and families do not get choices because they cannot afford them. To quote Professor O’Neill does the Minister accept “that children of rich families are deserving of a better education than those of poor families”? The marginalised young need more than a trip to McDonald’s; they need an equitable education system that values them instead of obsessively measuring them. They also need healthy basics in schooling starting with food. The Green Party was appalled to discover the Minister did not seek any advice or gather any evidence from either the Ministry of Health or the Ministry of Education before she ditched the school food and beverage guidelines. 
Teachers as reflective practitioners already know who needs help; they just do not have the time and resources to give it. The whole special-needs funding formula debacle is a case study in inequity as is the resourcing of early childhood education. 
Professor John Hattie is right in saying that the quality of relationships is the key to learning. Those who simplify his work and say that smaller classes are not needed probably have not experienced the difference between 30 wired 13-year-olds bouncing off the walls and 18 students with whom it might be possible to create a cooperative learning environment. Size does count in education at least. That is why the private schools put class size in all of their brochures. We do not need to change class size everywhere but we need to put State resources where the need is greatest. 
We might also like to start preparing our children for a different economy based on the reality of a finite world and a profound need for cooperation and non-violence. We need to teach them that we are fundamentally connected to the earth and what that relationship means. There is a whole economy to rebuild based on those principles. 
Last week I asked some young people who had been expelled or who had walked out of school what they needed and it sure was not a $3000 fine to their whanau. They said they needed no racism from teachers or from each other safety and respect and practical and relevant learning. If we want them to respond to us then we in this Parliament have to model these values. That is what I want to talk to the Minister about—not just the numbers. From the helicopter it is difficult for her to see the damage to the public school system but she will eventually have to come back down to earth. My fear is that when she does she will just bail out the private schools and ignore the real education funding issues. Kia ora tatou. 
SUE MORONEY (Labour) 
: 
 Financial reviews are fascinating processes because they require the select committee to take a helicopter view of what is going on in that particular portfolio. I need to inform the Minister in the chair Anne Tolley that when one is invited to take a helicopter view of the sector or advised that that would be a good idea it is not an invitation to hop in a helicopter and fly over buildings in order to look at them from the top; it is actually an invitation to look at the big picture and take a broad-brush view of what is happening in the sector. It is not an invitation for the Minister to take a helicopter ride. 
When one takes a proper helicopter view of the education sector it is difficult to take that helicopter view without realising the absolute importance of the early childhood education sector in the whole education process. I want to focus on that point because under Labour huge momentum was gained in the early childhood education sector. It came from being a very low-status sector to being one that was very highly valued by a Labour Government because Labour understood the importance of getting it right from an early age. We understood that if we invested in quality educational services very early on in people’s lives we would get better outcomes with in fact fewer resources as those people aged. 
The importance of the early childhood education sector gained hugely in status under the previous Labour Government. The 20 free hours policy that Labour put forward increased participation in early childhood education. In fact we heard in the financial review that the increase in participation was so high that it was larger than what the Ministry of Education had budgeted for. It had budgeted for a smaller number of 3 and 4-year-old children taking up the 20 free hours’ early childhood education. I know that was really disappointing for the incoming Government because National had campaigned long and hard to try to make sure that first of all providers did not buy into the 20 free hours concept and then it tried to convince families that they did not need it. So I know that National was very disappointed about the high uptake and the subsequent increase in participation in quality early childhood education for 3 and 4-year-olds. However despite National’s best efforts not only was it a success but also it was a raging success so much so that it outstripped the budget that the ministry had put aside in the financial year we are reviewing. 
But there was not only the 20 free hours policy there was also Labour’s policy to ensure that all staff in the early childhood sector would be qualified and registered teachers by the year 2012. That policy seems to have gone out the window. Pay parity also made a big difference in this sector because it acknowledged for the very first time in our history that the pay for teaching should not depend on the age of the child being taught. In fact some would argue that because it is so important that we get it right very early on we should be valuing more highly our early childhood education teachers. 
Under Labour this sector became very used to being highly engaged with Government planning. But no longer. Under the new Government the sector is completely unsure of the direction of the new Government in this regard because the sector has had no signs there has been no discussion and it has had no involvement in the future direction. I even found this in the Minister’s own electorate. It would not be that hard to go down the road and engage with the early childhood education providers in Gisborne but the Minister does not appear to have done even that. 
What has happened under the new Government? The first thing is that the funding for the nine new early childhood education centres in South Auckland that had been put aside by Labour has been put on hold by this Government. The Minister said she wants to increase participation in early childhood education and the first thing she did was to put on hold nine new centres for South Auckland the very area that is most in need in regard to increasing participation in early childhood education. 
What is another action that the Minister has taken? She has completely scrapped the improved staff ratios that were due to come into being on 1 July for children aged over 2. On 1 July this year improved staff ratios were on their way but the incoming Government has scrapped them. We questioned the ministry about the importance of having improved staff ratios in quality early childhood education. It said that there is no doubt that there is a very strong link between the quality of the education and the number of staff per child. 
COLIN KING (National—Kaikoura) 
: 
 When we compare the previous Minister of Education with the current one we see that today the National Government can be very confident that we have more character and get up and go in our Minister of Education the Hon Anne Tolley in the sense that she is going to make a difference. We are very pleased to see that. 
Let us have a look at the failed 9 years of the Labour Government when looking at the 2007-08 financial review of education. Education is recognised as the very foundation on which we build the opportunity and inspiration of a generation. When we look at the outcomes from that failed Government we see that one in five of our children is totally inadequate when it comes to being able to cope read write and do maths. What an absolute failure! The Hon Anne Tolley talks about parental involvement in education and being able to get a school report that is understandable so that parents can be engaged in education. But we hear the previous Minister of Education the Hon Chris Carter saying that teachers are fearful. I think we are seeing light at the end of the tunnel and we will see education growing and going onward and upward. 
Let us consider just for a few moments some of the debacles that occurred under Labour. Labour destroyed the technology teachers curriculum. The Correspondence School has been wrecked; it is no longer the iconic school that it used to be. What is happening to the agricultural curriculum in our secondary schools today? It has been totally wrecked and has been undermined. 
When it comes to truancy again Labour attempted to sweep it under the table to ignore it all together. It is very very disappointing to see that. We are now at a stage where we can do some improvements and look forward to some real achievement. Labour’s attempts were quite knee-jerk at the very end. When there were far too many early exemptions what did the Minister do? He just shut them down immediately without any consideration of what could happen. From that point of view a perverse effect was created. 
It was very exciting to go to schools in South Auckland like the decile 1 Southern Cross Campus which needed the opportunity to have hands-on learning. What did we see occurring under the previous Labour Government? That Government totally ignored the needs of the people in South Auckland. It was very very obvious to those people who had stood back and heard the rhetoric and the nonsense from the previous Government that that particular school was crying out for help. When we looked for its technology provision we found that it did not exist. It was an absolute failure. That is an indictment on the Labour Party member who represented that electorate. 
When we look through the education cycle over the last 9 years and particularly at the period of the financial review we see that Labour was strong on rhetoric. It was a very command-and-control environment. National has brought inspiration and opportunity to the table. It is about engaging in learning in a multitude of ways in a partnership between teachers parents and children so that we get some go-forward. 
One thing that really did disturb the Education and Science Committee during the financial review was the ongoing consideration of yet lack of substance around teacher training. We found that teachers were coming out from their teacher-training institutions and going into schools without even being able to operate assessment tools such as asTTle. That kind of assessment is very very important. If a teacher cannot clearly tell parents where their children are sitting in the education system we are failing that generation of children. 
It was a breath of fresh air when the Hon Anne Tolley announced that those schools that are performing very very well will have relief from the Education Review Office reports. I think that is a wonderful breath of fresh air. It allows the attention to be focused on those schools that need to be uplifted and inspired. I think that certainly is the way to go. 
Hon ANNE TOLLEY (Minister of Education) 
: 
 It certainly is an odd feeling to be standing in this House as the Minister of Education during a financial review covering a year over which I had no control whatsoever. In fact I may not even agree with some of the things that were done as they were done by the previous Government. 
If I have to use one phrase to sum up the Government that was responsible for this financial review 2007-08 I would say it was “promise and hope”. That is what the previous Labour Government was very good at especially in education. It made lots of promises hoped they would work and hoped the money would be there when the time came to implement them. The reality is that the money is not there and lots of promises were made for which no dollars were put up. One of the schools concerned was in Upper Hutt and I am looking at the local member over there but we will come to that. 
Let me talk through just some of the issues that have been raised in the House today. Early childhood education is a classic. The previous Government went out to South Auckland said it would build nine centres and named nine schools. One of those schools was a high school and one was an intermediate school. They are not very interested in having— 
Hon Trevor Mallard 
: What’s wrong with that? 
Hon ANNE TOLLEY 
: The schools were never asked whether they wanted to have an early childhood centre and whether they would work with one. The communities were never asked whether those were the places where the early childhood centres were needed. This new National Government will work with the community. We will not just build a great big centre and hope that people will come because they may well come but if we listen to the community we may find that those people come from another suburb and not necessarily from the ones where children need to attend an early childhood centre. 
This Government’s main priority for early childhood education is to increase participation particularly for Maori and Pasifika children. We are working very hard with the communities across South Auckland to develop what they want and what they think is appropriate for their children their whanau and their families. That is the first point. 
Secondly we heard the previous Minister of Education beating his chest about truancy. You know it was all promises. As the Maori Party speaker said the previous Government did not even make sure that an updated truancy survey was done last year. The only figures we have to go on are the 30000 students who are truant on any one day at the moment. 
Hon Trevor Mallard 
: Who was truant today? Who didn’t have the backbone— 
Hon ANNE TOLLEY 
: This Labour Party whose members are so vocal and keen on making jokes about it does not understand—and has never understood—that if young children are not at school they cannot learn. If they cannot learn they have no future. That party was prepared to condemn up to maybe 30000 students a day to that for the rest of their lives. 
I want to talk about bureaucracy because as I get around schools the one thing that I constantly hear about from principals and teachers is the amount of bureaucracy. I was at a school today where staff told me they are putting in $19000 worth of carpet—$19000 worth of carpet. It took 21 pages of forms and a property manager to manage it. That is just ludicrous. We will fix it and members will not see any of that in the next financial review. 
Let me come to national standards. The previous Minister of Education has been out there and he says he is hearing a lot about fear. I say to the previous Minister that he is talking a lot about fear. He is talking rubbish. Labour is misrepresenting what is a very good policy. In fact half the schools in the country are already doing what we are proposing they do so it is hard to understand what this kerfuffle is all about. One of those Labour members is very effective at using assessment to get effective teaching and student learning. He has already used it so we know that it works. You see we are a Government that is about doing what works—doing what works. 
The national standards will be in place by the beginning of next year. The first round of consultation with the sector will start at the end of next month and we are looking to lift educational achievement for every single student in New Zealand. We believe that whether they are Maori Pakeha Pasifika or Asian they all deserve an excellent education. 
Report noted. 
Crown Law Office 
Dr KENNEDY GRAHAM (Green) 
: 
 I speak to page 4 of the financial review of the Justice and Electoral Committee on the Crown Law Office and address one issue that was explored—namely the application of universal jurisdiction for war crimes. During the select committee’s review the Solicitor-General Dr David Collins provided an explanation of New Zealand’s approach to a person who may be in this country and who is suspected of having committed a war crime elsewhere. I appreciate the constructive response of the Solicitor-General to the questions that were put to him and the material that he subsequently supplied. Under the Geneva Conventions Act 1958 and the International Crimes and International Criminal Court Act 2000 New Zealand has established universal jurisdiction for the prosecution of anyone in that position the stated objective being to end impunity for perpetrators of serious international crimes. Yet in the only case to date where the issue has arisen we may have faltered at the first hurdle. 
When a former Israeli Chief of Defence Force was issued with an arrest warrant by a District Court during his visit to New Zealand the then Attorney-General stayed the proceedings the very next day. His decision rested on advice from the Solicitor-General that the evidence “could not be relied upon to show a prima facie case”. I hesitate to pronounce on that judgement by Mr Collins whom I hold in high regard but I note four points. 
First the Israeli Government had acknowledged to the United Nations Security Council that 14 civilians had been killed in an air attack for a targeted assassination in Gaza and the suspect had publicly admitted a decision-making role. Israel claimed self defence as legal justification yet council members including the US condemned the attack as being heavy-handed action. Israel knew that at least one civilian was with the targeted militia leader and that others might be in the vicinity. The action it appears constituted incidental loss of life disproportionate and excessive to any anticipated military advantage and thus there was a prima facie case for a war crime. Second under the 1958 Act the Attorney-General’s obligation is not simply to pronounce on the substance of evidence that a New Zealand resident may have supplied and that a judge may have decided upon but rather to search for suspected persons and bring them before our courts. Third although the consent of the Attorney-General is required before an information can be laid under the 1958 Act that is not the case under the 2000 Act. Fourth New Zealand cannot engage in self-absolution from such a criminal prosecution on the grounds that the International Criminal Court was not active on the matter because the primary responsibility under the principle of complementarity rests with national courts. For these reasons and having consulted extensively with legal scholars I come to the unavoidable conclusion that New Zealand failed its international obligations on this matter. 
That is history. I now address the current Attorney-General Christopher Finlayson who is held in high esteem throughout this country with the following points to ensure that we meet our responsibilities in the future—for these kinds of issues are certain to recur. I ask whether he can confirm the following: first that an information may be laid and an arrest warrant issued under the International Crimes and International Criminal Court Act 2000 without his consent; second that independent of the evidential merit of such an information the Government has an obligation under the Geneva Conventions Act 1958 to search for suspected persons and bring them before the courts of this country; and third that in deciding upon consent for prosecution his judgment of the national interest and the public interest will faithfully reflect the legitimate claim of any New Zealand resident in ensuring natural justice over suspected war crimes committed anywhere over and above any political interest in our bilateral relations with any other country. Thank you. 
Hon CHRISTOPHER FINLAYSON (Attorney-General) 
: 
 I thank the honourable member Kennedy Graham for raising those questions and for having given me advance notice of them because they are important questions and are worthy of consideration. 
The first question is answered thus: under section 13 of the International Crimes and International Criminal Court Act 2000 the consent of the Attorney-General is required before any proceeding for an offence under sections 9 to 11 of that Act can be instituted. As with all prosecutions requiring prior consent a person may be arrested on warrant before an information is laid but no information may actually be laid. In relation to the issue concerning the Israeli officer an information had been placed before the District Court and a warrant to arrest was issued on that information. That in fact made the proceeding a nullity because there was no jurisdiction to issue the warrant on the information and there was no evidential basis to arrest either. 
The second question the honourable member raised asked whether the Government had an obligation independent of the evidential merit of the information to search for suspected persons. If there is reliable information that a war crimes suspect is in a particular jurisdiction—say this country—then the State party has an obligation to locate that suspect. I understand that New Zealand did exactly that a decade or so ago in relation to a possible World War II genocide suspect. But the key point is that the Government can take no formal step without evidence of a standard necessary to arrest and detain. That principle applies whether or not the trial would be in New Zealand and whether or not the suspect would be extradited. The principle or obligation had no application to the Ya’alon case; the Government knew where the general was but until the evidence was sound it had no possible authority to detain him. My understanding is that whatever the relevant international obligation the obligation to search for war crimes suspects is subject to the usual safeguards in our criminal procedure. The material supporting the criminal allegations in the case the member has raised was essentially an information pack that had been emailed from a source in London and that contained no admissible evidence. So if the person concerned had been arrested there probably would have been an application to the court for habeas corpus and I imagine that it would have been granted. 
The third question the honourable member raised was about what steps the Attorney-General must take in determining whether the prosecution is to proceed and whether his judgment of the national interest will faithfully reflect the legitimate claim of any New Zealand resident in ensuring natural justice over suspected war crimes committed elsewhere over and above any political interest in our bilateral relations with any country. I agree that that is a very important question. The issue of national interest in relation to a criminal action is always a matter for the Attorney-General in Cabinet acting as the senior law officer. The nature of the relevant national interest will differ from case to case so no particular assurances could be given to the member as to the weight to be given to particular values. That approach was recently endorsed by the House of Lords in a decision about the BAE Systems bribery scandal—the member may well be aware of it—involving Saudi Arabia and The Corner House litigation where the Director of the Serious Fraud Office took steps in relation to a prosecution. 
I hope those answers satisfy the member. The matters are of great moment. I am grateful to the member for giving me the opportunity to at least reflect upon some of those questions and I would be happy to take the matter up privately with him at any time. 
Report noted. 
Ministry of Foreign Affairs and Trade 
Report noted. 
Department of Conservation 
METIRIA TUREI (Green) 
: 
 I want to address two issues in the financial review. The first is the Community Conservation Fund and the second concerns biodiversity protection. The Community Conservation Fund which was discussed at the financial review is a Green Party Budget initiative from the 2008 Budget. I am very pleased with the success of that conservation fund. In fact just last week the Department of Conservation announced the first round of successful funding applications whereby a million dollars was distributed to a large number—nearly 30 I think—of community organisations runanga and other organisations doing conservation work on public land. This fund is designed to support the work that is being done on public land such as dune lands wetlands and other areas that traditionally miss out on funding. It helps to build relationships between local communities councils and iwi. I note two particular projects: the Tomahawk Smaills Dune Restoration project in my area in Dunedin and the Hokonui runanga who received funding to do restoration work on the banks of the Mataura River—one of the most polluted rivers in the south of the South Island due to the high industrial pollution that goes into that river. I congratulate all of those who received funding from their applications and encourage all those who did not to apply again to the Department of Conservation because further rounds will be distributed. 
The second issue is around biodiversity protection which was mentioned in the review and I note that today the Parliamentary Commissioner for the Environment has released the report  
Change in the high country: Environmental stewardship and tenure review 
. This is a very serious report and it highlights a great deal of the concerns that the Green Party has expressed about the tenure review process and its failure to protect biodiversity values of the South Island high country. The South Island high country is public land it is owned by the Crown there are long-term leases for that land distributed to farming families for the purposes of farming that land and tenure review is the process for dividing that land between leaseholders for productive use and the retention of land of high biodiversity value in public hands for public use. 
The biodiversity land of much of the South Island high country is absolutely huge but it is also hugely threatened. It is not that the public would necessarily know that because the commissioner has reported that the 2008 Government audit of the tenure review process did not mention any of the adverse effects of tenure review and only highlighted where there was an advantage. But in fact we know that for every 6 hectares of high-value conservation land in the high country only 1 hectare is protected by the tenure review process. I say again that only 1 of every 6 hectares of the most highly valuable conservation biodiversity land in the South Island high country is protected by the tenure review process. Tenure review is failing to protect the biodiversity values of the South Island high country and as a result New Zealanders are losing their most valuable biodiversity in the high country because the tenure review process favours privatisation of public land. 
The impact of this privatisation on water quality is extremely serious and that was also noted by the commissioner in the report. The report identifies the serious risk that farming practices have for water quality even those in the high country which are often different kinds of farming practices than one might find elsewhere. None the less there is significant intensification of those areas of land that are privatised. The report states that the continued intensification of privatised leases will inevitably result in “significant adverse impacts on adjacent water quality” contrary to the primary objective of the Crown Pastoral Land Act which is to promote ecologically sustainable land management. 
The tenure review process is failing our country. It is failing to protect the water quality of those very important areas and it is creating a serious risk to biodiversity protection and water quality. The commissioner’s report also notes that it is threatened by the weakening of the Resource Management Act by National. As we know the National Government is engaged in the process of weakening the Resource Management Act to make it more difficult for New Zealanders to be involved in ecological protection. That is a disgraceful position for this Government to take. 
Hon TIM GROSER (Minister of Conservation) 
: 
 It is a great privilege to be involved with the Department of Conservation—I say “Conservation” because the speaking order has me listed down as the “Minister for Conversation”. 
Hon Darren Hughes 
: That’s true too. 
Hon TIM GROSER 
: Yes but I would like to reassure the member there is no truth that I am thinking of trying to become the “Minister of Silly Walks” as well. 
The conservation estate is a very considerable part of New Zealand’s heritage and we look at it across a whole variety of issues. The member who has just spoken Metiria Turei raised some of the most important issues and I acknowledge many of the points that she made. The conservation estate is a work in progress and there will always be issues that require us to address them. The tenure review which has just been published today requires very serious consideration by the Government and I absolutely take that member’s concerns on board. I will be working through some of those recommendations from the Parliamentary Commissioner for the Environment over the coming months. 
The issue of biodiversity is a massive responsibility for New Zealand as I have learnt from becoming the Minister of Conservation and getting excellent advice from the department. We have a unique country. The reason that New Zealand has this amazing biodiversity although so much has been lost since the intervention of people and the mammals that came with them is the unique circumstance whereby New Zealand became separated 80 millions years ago and floated away from Gondwanaland before the rise of mammals in large numbers. The result is that 25 percent of the remaining birds in New Zealand are not found anywhere else in the world. It is a great responsibility for us to manage but it is also a major economic advantage for us. 
We should not just see the country just in terms of promoting it for its own sake. It is also the infrastructure behind New Zealand’s most important industry and that is tourism. Tourism employs one in 10 New Zealanders. When I went on a familiarisation tour—much of it by helicopter I would like to remind members— 
Hon Darren Hughes 
: There’s tomorrow’s question. 
Hon TIM GROSER 
: Absolutely! I would like to remind the member that even on Friday Mr Finlayson the Minister for Treaty of Waitangi Negotiations and I were up in a helicopter above the Ureweras. Now members understand that being rugged outdoorsmen we did think about walking through the Ureweras and asking for leave from Parliament until about mid-2010. 
Hon Darren Hughes 
: I would’ve given that! 
Hon TIM GROSER 
: I know the member would have but we were not sure that the Prime Minister would have granted us leave for about 18 months. So we took a helicopter to look over Te Urewera National Park a magnificent dark and mysterious part of New Zealand. It is another aspect of the whole responsibility that goes with the conservation lands held in perpetuity for our ancestors to come. 
The marine environment is something that needs closer attention. I think it is now pretty much an accepted consensus in New Zealand society—and it is certainly a view shared by all political parties—that we have to maintain conservation values on the estate. It is always going to be a struggle to manage essentially one-third of the country on a budget of around $300 million. Imagine if one was maintaining property with the equivalent asset value on $300 million! But the financial reporters do an excellent job they have been doing an unqualified audit and I think that we are very privileged to have New Zealanders who are dedicated to this. 
It is not just the people who work permanently for the department. I recall from the briefing for incoming Ministers which I studied pretty carefully that there were 1858 full-time equivalent employees in the Department of Conservation. Volunteers are also important and that is the point the previous speaker made. There are something like 7000 volunteers across the country so there is huge buy-in to the work of the department from our communities. I think that together they do a pretty good job but there are great challenges ahead. 
I have been told that the estimate of the cost of fixing up Lake Taupo and the Rotorua Lakes is $223 million. I do not know how much flexibility there is around the estimate but that is the figure I have been given. Yet against that I have another estimate which is that the value from the trout fisheries to the Tongariro-Taupo area is $80 million a year. I think it puts into perspective the sums of money involved and it reminds us that we should look at this in terms of it being a great economic asset to New Zealand. 
When I went down to the South Island to try to get a better handle on the issues and visited the Fox Glacier after the tragedy of the two Australian people of Indian ethnic descent I found that— 
Hon Darren Hughes 
: “Minister of Conversation”! 
Hon TIM GROSER 
: —yes the “Minister of Conversation” is continuing—650000 people of whom the Department of Conservation believe 75 percent were probably foreign tourists visited the Fox Glacier and the Franz Joseph Glacier. The Milford Sound had 440000 visitors of whom 96 percent were estimated to be foreign tourists. That gives some idea of the huge economic investment that we have as well as other responsibilities we will have in the future. 
Hon Steve Chadwick 
: We look forward to the Budget Minister. 
Hon TIM GROSER 
: Indeed. 
Thank you very much for the opportunity to make some initial comments on the department. I look forward to working with it in the next year. 
Report noted. 
Ministry of Transport 
Hon DARREN HUGHES (Labour) 
: 
 It is a pleasure to speak to the financial review of the Ministry of Transport and to follow on from the self-described “Minister of Conversation” the Hon Tim Groser. When I was listening to him speak about the Department of Conservation I found it hard to believe that he had delegated the entire thing to the Hon Kate Wilkinson. He seemed to be so keen on it—but there we are; that is not what the schedule of delegations revealed last week. 
 The period under review by the Committee of the whole House was a quite exciting period for the transport portfolio. Quite a lot of important decisions were made and there was vision and a strategic view about where the New Zealand transport sector could be heading. When we compare that period with the one we find ourselves in today we can see what a good period that was for New Zealand. Some true decisions were made across a whole range of issues that matter to the people the businesses and the community and social organisations in this country. That is the period that the Committee finds itself looking at. It seems that many of those very fine decisions and the direction we were heading in have been abandoned in the current period and the Committee should be asking the Government to account for that. 
Hon Members 
: Oh! 
Hon DARREN HUGHES 
: Members opposite laugh but when some of the figures are thrown out at them they will realise that the Government they are supporting has abandoned a balanced view towards transport. That is the great tragedy of this: they have allowed a balanced view—a view that looked at a whole range of forms of transport—to be thrown out the window. They laugh and throw off at that because they are interested in roads alone. 
Roads are a very critical part of the transport system for New Zealand. Every single member agrees with that but we say that it is not the only form of transport that is important. The Hon Parekura Horomia points out to me that it looks as though the only multimodal approach the Government is prepared to take is with regard to helicopters. When it comes to helicopters Tory Ministers cannot wait to climb into them. We know that the Minister of Education was unable to be held to account today because she was busy in a helicopter. Tim Groser made it a point of great privilege that he was in a helicopter and the Minister of Internal Affairs is leaving the Chamber right now to go in a helicopter—it may well be that he is bungy jumping from it rather than actually taking a trip. Of course the Minister of Transport has been going around the Wellington region in his helicopter presumably right along the fence line he sits on with regard to any decision about transport for the people of this region. So Mr Parekura Horomia is quite right in that respect. 
So what did the Minister inherit in terms of this financial review? He inherited a transport system that focused on how we can manage a system consistent with the environment. 
Hon Members 
: Oh! 
Hon DARREN HUGHES 
: The National members laugh and there is a smirk on the face of the Minister in the chair the Hon Steven Joyce. I am yet to work out whether that is a permanent affectation or whether it is in response to some of the points being made in the Committee. I guess time will tell in that respect. 
The previous Labour Government put sustainability at the front and centre of the transport sector and that has been thrown to one side by the way in which the Minister has a focus on roads only at the expense of public transport and alternatives to roading. 
I ask the Minster whether he is in support of the previous Government policy statement with regard to the halving of greenhouse gas emissions for the transport sector by 2040. That is what he has inherited in the financial review. He has inherited a commitment to reducing greenhouse gas emissions by half by 2040 and I would like to know from him whether he will meet that commitment and if so how he is planning to do it. 
I would also like him to explain to the Committee why he has cut $15 million of expenditure from cycleways and walkways as is shown in his very own ministerial Cabinet paper. The increase in that mode of transport has been cut by him when at the same time we are told by the Prime Minister that one of the great saviours from the global financial crisis will be a bicycle lane across New Zealand. Those of us who were up in time to watch  
Q 
+ 
A 
 on Sunday morning saw that the Minister of Finance had very interesting body language and quotes about that particular project. Once that idea was handed to John Key by a real estate agent—it had been given on the back of an envelope to the Mayor of Auckland who handed it to the Prime Minister—it became Government policy for the economic recovery. We are holding the Government to account on that and I would like to know from the Minister of Transport why he has reduced funding for cycle and walking facilities by $15 million which was projected in the Government policy statement. 
I would also like to know from him whether he is interested in safety on the roads. He has cut $50 million from future spending on road safety according to his recent announcement. 
Hon Parekura Horomia 
: How much? 
Hon DARREN HUGHES 
: He has cut $50 million. I would like to know from him whether he is in support of the moves by the previous Government to reduce the road toll in New Zealand. 
DAVID BENNETT (National—Hamilton East) 
: 
 After that speech from the Labour member Darren Hughes we need to get some facts straight. It is simply rubbish that National is planning to cut out public transport. 
Hon Darren Hughes 
: It’s true. 
DAVID BENNETT 
: It is not true at all. The reality is that National is committed to all forms of transport. 
Sitting suspended from 6 p.m. to 7.30 p.m. 
DAVID BENNETT 
: Just before the Committee rose for dinner I spoke in reply to what Labour members had been saying about transport planning and funding under this new National Government. They were concerned about what they perceive as a lack of focus on public transport and environmental initiatives. We need to dispel those rumours straight away because National is very much focused on public transport and environmental concerns. The transport portfolio gives us a manner in which to focus on those concerns. 
Hon David Carter 
: Sensible. 
DAVID BENNETT 
: I think Mr David Carter is saying that it is a sensible solution and that is quite true. When we look at public transport we see that the National Government has committed to the electrification in Auckland which is the big public transport issue in Auckland at this time. The Labour Party members stand up and say that we are not committed to public transport but that is not true. National has made that commitment; we are very much in the mode of wanting to see that commitment to that public transport element through the electrification of the trains in Auckland become a reality. 
If we look at the environmental concerns that were raised by Labour members we see that they need to look forward at how transport planning will be in the future. One can see the movement that the US has made through the Obama regime to get cleaner greener fuel sources for cars. In New Zealand we will adopt that technology at some point in time and we will find that in 10 years’ time the cleanest greenest form of transport will be electric cars on roads. That is the future of transport solutions. It is not far away. There have been developments in some of the big US universities in the last couple of weeks; they are moving towards that technology and trying to make it a practical reality. The US administration is supporting that and I think that National’s endeavours to get some of our main structural roads finished will actually have big environmental paybacks in the future. New Zealand is setting itself up to take advantage of that clean green technology in the future. 
That leads on to what is probably the biggest initiative and something that the Minister needs to be wholeheartedly congratulated on: identifying roads of national significance. That is a major structural change to the thinking of transport solutions in New Zealand. New Zealanders traditionally thought of all roads all public transport and all other forms of transport together and dealt with them in one process through the regional land transport committees. We have found that some major strategic roads need to be taken out of that process and put into a much more simplified and quicker process that enables the investment the Government makes in nationally significant roads and other structures to become roads and structures that get built on time and for the future of the economy. That will provide efficiency and economic growth for this country. The Minister of Transport has taken that very bold step and it reflects what has been done in many other countries like Australia. He should be congratulated on his bold approach. He is showing vision and direction for an industry and a portfolio that has really lacked that in past years. If we look at what will happen with Auckland’s governance issues and put that together with those bold steps that the Minister has pronounced we will see some major solutions coming forward that will deliver for New Zealand transport in the future. 
If we look at what the previous Labour Government did we see that it went through a series of transport Ministers none of whom achieved anything in their portfolios. Those transport Ministers were really just biding trying to blame the previous transport Minister or past Governments. They did not have any visible solutions and it was not until the National Party came into office that we saw some reform in process and some delivery that will bring about the necessary completion of roading projects and of the public transport network throughout New Zealand. The Labour Party initiated a series of reviews to try to hide the issues around public transport. 
Hon STEVEN JOYCE (Minister of Transport) 
: 
 It is a pleasure to speak on the transport portfolio this evening. I first congratulate the Opposition spokesperson on transport Darren Hughes on his fantastic haircut. It is very impressive. I recommend something a little more utilitarian; perhaps something like Mr Bennett’s might be more in keeping. 
We are of course referring to the 2007-08 year and I think the trouble with the previous Labour Government is that a lot of the stuff it talked about was puffery if I may say so—puffery. There were so many things—there were so many strategies within strategies and reviews within reviews—that we ended up with a lot of very impressive bits of paper and not a lot to show for it. By way of an exhibit because we are referring to the 2007-08 year I refer to  
Sea Change: Transforming Coastal Shipping in New Zealand 
 which I think is a fine document in that I obviously support coastal freight and freighting generally. This particular document is 36 pages in duration. Over the dinner break I took the liberty of working out that there are 14 full pages of photos in this 36-page document. There are four pages of maps and the equivalent of seven pages of white space. So of the whole 36-page strategy document that the previous Government oversaw 25 pages are what one might generously call illustrations. 
I think that was a little bit the story of the previous Government’s approach to transport. The honourable member opposite Darren Hughes mentioned an approach to road safety. He was I thought quite negative about the new Government’s approach to road safety. One of the big things we need to do is improve the quality of our highways. I refer to one that was in his former electorate of Otaki which is the road from Foxton to Paremata. There were 81 fatalities on that highway over the last 10 years and 256 serious injuries. We can tackle that in many ways but one of the ways we have to do it is to improve the quality of the State highway infrastructure. I make absolutely no apology for taking that approach. 
I draw attention also to the actual growth figures in the National Land Transport Programme going forward because those are the ones that have been criticised so much by the Opposition. There are some interesting numbers. The actual allocation for walking and cycling facilities is up 42 percent for the next 3 years over the allocation for the last 3 years—a 42 percent increase. I freely acknowledge that that is not quite as much as it would have been under the previous Labour Government but it still remains a 42 percent increase. It is not a cut. Renewal of State highways is up 12 percent maintenance and operation of State highways is up 16 percent renewal of local roads is up 19 percent and maintenance and operation of local roads is up 16 percent. 
Road policing is a very interesting one that is often talked about. The allocation for road policing in this country 2 years ago was $232 million. This year it is $273 million—it has gone up $40 million over 2 years and I salute the party opposite for actually bringing that forward. We have said that that is a lot of growth in 2 years. We are now taking it to $291 million then to $300 million and then on to $309 million yet the member opposite stands up and says during his 5 minutes that we are cutting road policing. We are not cutting road policing; we are growing it. 
More important we are also committing to public transport. The commitment to public transport is huge over the next 3 years. Public transport services are going up from $484 million—forget what Opposition members say this is what they actually did over the last 3 years—to $633 million over the next 3 years which is a 30 percent increase over 3 years. 
Hon Paula Bennett 
: How much? 
Hon STEVEN JOYCE 
: Thirty percent. It is a 30 percent increase over 3 years. The Labour members are trying to say that there is some sort of decline but there is not. 
On top of that the Government is committed to the Wellington railway. It is committed to the double tracking in Auckland which I freely acknowledge is an initiative started by the previous Government. It is also committed to electrification and to KiwiRail purchasing the trains. All up around $1.6 billion has been allocated in Auckland alone. 
So members should pity the poor motorist who finally gets a deal under this Government! Members should pity the motorist who will finally having paid his or her road taxes get an investment back on the roads from this new Government! Instead of a 9 percent decline in State highway infrastructure spending which was projected by the previous Government for the next 3 years we will see a very significant increase because of this transport reality. As much as we would like it to be something else it is not different. 
Hon DARREN HUGHES (Labour) 
: 
 It is a great privilege to follow the Minister of Transport Steven Joyce. I appreciated his flattery. The problem at the moment is not that I have had a haircut but that I need one and I have also completely run out of hair product; the Minister has probably never found himself in that scenario. 
We cannot quite see eye to eye on that issue nor can we see eye to eye on his commitment to public transport. Steven Joyce just stood in the Chamber and said that he was increasing the amount of money available for public transport service; he said that he was increasing it to $633 million. But according to the previous Labour Government’s policy statement for the 3 years we are heading into the funding was meant to be $666 million which is probably quite a good figure for the Minister’s more sinister political motivations. That is a cut of $33 million out of public transport at a time when Governments all over the world are looking to public transport not only to try to make a difference in their economies but also to move more people by public transport. This Government will spend less on public transport and on alternatives to roads than the previous Labour Government had projected funded and budgeted for. What other country in the world is doing that? 
Hon David Parker 
: Zimbabwe. 
Hon DARREN HUGHES 
: Zimbabwe is doing that apparently. Well that could be the kind of political intrigue we would be expected to believe. 
We can see in the figures that this Minister is presiding over a cut in public transport services—that is certain. I also point out that the road policing allocation which the Minister waxed eloquent about falls from $949 million to $900 million. That is a $49 million cut in road policing in our country. The previous Government had committed to reducing fatalities on our roads to 200 per year. I asked the Minister whether he would address road safety but he said nothing. 
The point I am most surprised about with regard to Steven Joyce is that he did not mention the Waterview Connection whatsoever in his speech to the Committee. We know that the Government is not committed whatsoever to the Waterview Connection in Auckland. 
Hon Paula Bennett 
: You could run for Mt Albert. 
Hon DARREN HUGHES 
: If the Minister does not stop squawking I might come and run against her in Waitakere. That would wipe the smile off her face. I tell members that if ever someone got lucky in that respect it is the Hon Paula Bennett. I invite her not to take me on too seriously in that particular respect. 
We need to know what the Minister is planning to do with the tunnels in the Waterview Connection. We know that that road was fully consulted on with the people of Auckland but it is not as if he pays much attention to that consultation. He rode roughshod over what the people of Auckland had planned for their transport. He will be taxing the whole country an extra 6c a litre more than they are paying for petrol today in order to fund half of the transport projects that Auckland requires. When it comes to Auckland’s western ring route the Minister through his plans for the Waterview Connection will be cutting out 400 homes. We know that he is not committed to the tunnels despite the fact that the public was committed to them. 
What is he doing to try to complete the project? Well first of all he is blowing out the costs himself. One of the things that we have learnt about the star of John Key’s Cabinet—mind you that is not much praise really when we consider what the alternatives are; it is only the fact that we do not know much about him that makes him a star—is that he has completely turned all the funding for that project on its ear. For example he has said that he would like to add additional traffic lanes to those that people were consulted on. He said that he wants to include the north-western motorway at a cost of $240 million in the cost of the Waterview Connection. He then threw in $500 million worth of financing costings for that project which no other project is subjected to. He said that he would put that extra half a billion dollars in and then he went on television and said that the cost of the Waterview Connection had exploded from $1.8 billion to $2.27 billion. 
Well it is just not credible. It is not credible for the Minister because he wants to try to mow down people’s homes—hundreds of homes—in Auckland to play skulduggery with the figures in order to change the facts that the community has been consulted on. He may be a marketing genius—we know that—but he has to start playing on a level playing field with the figures with regard to transport. Whether it is public transport in rail water services buses or an alternative to roading like coastal shipping this Minister is not being up front about the costings he is putting into the transport proposals that he is riding roughshod over. 
The Waterview Connection is critical for Auckland as it completes the western ring route yet this Minister is not showing any commitment to it whatsoever. He did not even mention it tonight. He tried to get out of the fact that he is cutting $49 million out of road policing. He said that he was spending more money on roading but he did not tell the country that he had redirected $420 million away from what he calls non - State highway classes. Most of us call that public transport—buses trains ferries cycleways and walkways. Most of us common people call it that. [ 
Interruption 
] Oh I keep forgetting the helicopters that the National Government is so proud of. 
Hon STEVEN JOYCE (Minister of Transport) 
: 
 There are a few things we cannot let pass completely there. Firstly the previous Labour Government’s commitment to the Waterview Connection project did not involve any money. That is the unfortunate part of it. There was no money involved in it at all. It was a commitment to the extent that those members liked the idea and they also called for a report on the business case for that particular road. 
Hon Darren Hughes 
: So did you. 
Hon STEVEN JOYCE 
: No that was the report of members opposite. I actually quoted from the previous Government’s report prior to Christmas. The one with the funding in it was the previous Minister of Transport’s report which was ordered before I arrived. So all I did was to dutifully roll up and say: “Here is the report that was asked for before I turned up.” Any references to the funding costs are there because the previous Government asked for the report. 
The $2.77 billion—which I think we can all agree is a lot of money—that includes the element of funding was in the report that was asked for by the previous Government. The opportunity cost if you like to go to three lanes in each direction is $3.2 billion and I think it is fair enough. 
Hon Darren Hughes 
: That was never the plan. 
Hon STEVEN JOYCE 
: If members have travelled on that road in that part of Auckland—and I take it from that comment that the Hon Darren Hughes has not—they will know that if we were to open that road within a very short period of time we would have what is known as gridlock in Auckland. A lot of people have experienced that because Wellington politicians think they know what is best but they do not actually go to Auckland to find out what the situation is. The situation in Auckland is that if we do not plan for that road to go three lanes in each direction then truly we have no understanding of the way that that part of the city is developing. 
The likely cost is around $3.2 billion. 
Nathan Guy 
: How much? 
Hon STEVEN JOYCE 
: It is $3.2 billion if we go to two three-lane tunnels. The cost goes up from $2.77 billion to $3.2 billion. 
Hon Darren Hughes 
: What rot! 
Hon STEVEN JOYCE 
: The member opposite is critical because the new Government might wonder whether there is another way as that figure just happens to be somewhere between 1.6 percent and 1.8 percent of New Zealand’s GDP. 
This is a small matter but it is an important matter. I understand completely the issues that we have with community problems when we do roads—I absolutely understand that—but we also have to have an understanding of the opportunity costs of such large investments particularly in this case when there was no budget for it. 
Another project that did not really have a budget was one that is—or was—very dear to the Hon Darren Hughes’ heart which is the Transmission Gully project. The previous Government notionally provided $400 million towards that project on the ground that the other $600 million be provided in some way shape or form by the Wellington Regional Council doing raffles and things and by a regional fuel tax that would not have even come close. That was Labour’s funding of Transmission Gully. 
Then there were a lot of other projects that the previous Government did not fund. It did not think of the Puhoi to Wellsford project. There are some Christchurch motorway projects which my colleague the Hon David Carter would know about. Those took years and were not happening. 
Hon David Carter 
: They kept promising. 
Hon STEVEN JOYCE 
: They kept promising. There was the Tauranga eastern corridor; the Waikato Expressway which I am sure Labour announced would be completed quite quickly a number of times; and the Auckland Victoria Park bottleneck which I was informed by the New Zealand Transport Agency only a week ago might have had to go back further if we were to have stayed with the previous Government’s funding plan. We have had to bring it forward by 10 months and if Labour had stayed in office it would have been put back further. 
Hon Darren Hughes 
: That’s wrong. 
Hon STEVEN JOYCE 
: Well that is what the New Zealand Transport Agency told me. 
Hon Darren Hughes 
: We announced that in our election policy. 
Hon STEVEN JOYCE 
: The member can announce it all he likes but if he does not fund it then nothing happens. That is the reality of it. I think we need to get that point across: the member can announce whatever he likes but if the Government does not put up the money it does not happen. That is the reality unless we put up some decent funding. 
What we will do over the next 10 years is go from spending $6.6 billion to spending $10.7 billion on State highway infrastructure. That will make a difference. That will see some of those projects completed and some others significantly advanced and that is the deal. If one is to talk about doing things then one has to be prepared to step up and do them on behalf of taxpayers. That absolutely has to be done alongside public transport projects in Auckland Wellington and Christchurch. I completely understand that in particular because there is no way that there is a single modal solution in those cities. Once the Waterview Connection and Victoria Park projects in Auckland have been done there are some arterial roads to do but after that the focus is public transport. We all have to understand that and we accept that. That is why the new Government has committed to the $1.6 billion that is involved in public transport. Thank you. 
Report noted. 
Ministry of Social Development 
RAHUI KATENE (Maori Party—Te Tai Tonga) 
: 
 In 2007 during the period of this financial review the Maori youth unemployment rate was a massive 23.7 percent. As this Chamber will know the youth unemployment rate records the number of unemployed youth aged between 15 to 19 years divided by the total number of youths in the labour market aged between 15 to 19 years. For the European population the rate was only 11.4 percent. That is a 12.3 percentage difference. The Maori youth rate is more than twice as high as the European one. 
I want to set the context for looking at the review of the Ministry of Social Development by placing our rangatahi firmly in the centre. At this point in time there are almost 4000 young Maori job seekers out there. In the Maori Party our biggest concern is that they are active and engaged in further education training and employment in society. The report of the Social Services Committee into the financial review of the ministry gave considerable focus to the area of unemployment. It is of interest that just as the previous Government ignored the very substantial inequalities related to the Maori unemployment rate so too did the committee’s report. It is silent on the Maori rate. This is of such concern because the committee’s report puts the microscope on to the strategies in place to prepare for a possibly large rise in unemployment. 
It was interesting to hear of the twin dilemmas facing the ministry: the challenge of being able to absorb unemployed people while also staying on top of its workload. We know that the ministry prides itself on measures such as being able to quickly place job seekers into either a transition service or a training seminar within the space of 28 days. For us we think those measures are vital to keeping the workforce dynamic and to responding quickly to the needs of the people. But we simply say that if we value the diverse populations that comprise the New Zealand workforce we must ensure their specific needs are considered. 
There is no dispute that Maori unemployment given all available scenarios is likely to be at least double the general rate. Te Puni Kokiri suggests that Maori unemployment will rise from 8 percent to something like 12 to 15 percent by the middle of next year. We know the history and we also know that the initial signs of an economic slow-down are being felt in construction tourism and primary industries. Those are all industries in which Maori are strongly represented. We know the dramatic overrepresentation amongst Maori youth. 
With all of this information in front of us it was disappointing that not one of the Labour Green or National members on the Social Services Committee raised issues to do with Maori unemployment. Fortunately we are now in the position where a Maori Party Minister the Hon Tariana Turia has the delegated responsibility for Maori and Pacific employment issues within the social development portfolio. I believe that this is a very positive development for Aotearoa. 
Mrs Turia is someone who used to be the southern regional coordinator of the Maori Access training programme who managed the Whanganui Regional Development Board Trust who was a service broker for Te Puni Kokiri and who was a founding team member of the Te Awa Youth Trust. Above all she is someone who is passionate about whanau ora. I am optimistic that the genuine concern Mrs Turia has for Maori and Pasifika employment will be vital in ensuring that the Ministry of Social Development in preparing for unemployment truly prepares for the needs of all New Zealanders in managing any rise in unemployment beneficiaries over the next year. 
There are hard times ahead; none of us deny that. The key point I have been making within our communities is that the onus of responsibility must not be that of the State alone. This is the ideal time for collaboration to be the buzzword. It is good to see in the committee report that the ministry is developing industry partnership with a large number of companies and industries. What we in the Maori Party would like to see is the initiative taken to establish partnerships with iwi and Maori-owned business enterprises to achieve better employment outcomes for all Maori and in particular youth. There are iwi out there with all the infrastructure and enormous enthusiasm for working together to mitigate the impacts arising from the recession. Thank you. 
JO GOODHEW (National—Rangitata) 
: 
 I rise to speak in this financial review of the Ministry of Social Development. Top of the list for the Social Services Committee when we conducted the financial review was capacity within the ministry capacity that currently existed during the financial year under review and capacity that we were able to look at in the 6 months since the review. Each of the committee’s members were very interested to hear what the ministry’s capacity was and how it would meet needs within the current economic climate. Topmost of just about every front page publication around the country is either a story about a potential redundancy or a business going under or things the Government or the community is doing to alleviate or deal with the current needs of those businesses and communities. 
First of all the select committee questioned the chief executive about the ministry’s capacity when it came to social workers. We were advised that its social worker numbers had stabilised and its turnover had significantly reduced. Although there was talk of a pay equity investigation for social workers it had become increasingly not necessary. At one time there was a difference of some 9 percent between male and female social workers’ pay but it was now down to just over 1 percent making the decision to can that pay equity investigation most appropriate. 
We also questioned the chief executive about value for money and we were heartened and very impressed to hear that there had been two value-for-money studies since 2005. In fact it was a priority for quite some time for this particular ministry to prepare itself to better meet the needs of New Zealanders. This sharpened the ministry’s pencil for the onslaught that has subsequently come and will continue to confront the ministry head-on. In gearing up for meeting the challenge the ministry told us about Community Link Centres and there are now five of those open around the country: in Flaxmere the original—I believe—in Linwood in Christchurch in Huntly in Naenae and in Ashburton. 
Hon Ruth Dyson 
: You’ve done nothing on those. 
JO GOODHEW 
: Members opposite are becoming rather upset. I have not for one minute claimed that this initiative is the work of the Government though I was absolutely delighted to welcome the Community Link Centre to Ashburton. It was the work of the community and the Ministry of Social Development and I was very pleased about that. Some 560 families have already been through Community Link Centres around the country and that is something to celebrate. In Community Link Centres those families can have their needs addressed all in one place. They are not traumatised by having to tell their story over and over again. 
The ministry also supported the Prime Minister’s Job Summit in Auckland and the regional and local summits around the country. It was at my local summit—the Aoraki summit—that I was really heartened by the number of fantastic ideas that came out of that community collaboration with community non-governmental organisations community business leaders and other types of community leaders all getting together and coming up with some great ideas of how they could work together and use Government resources to help that community to keep people in jobs. 
 I will also briefly touch on a programme called PATHS—Providing Access to Health Solutions. This is a programme that has been running for some time now. I am told that 1072 clients have participated in the programme in the year under review. Of those clients 20.1 percent found work 13.8 percent ceased to be on benefits and 6 percent increased their part-time earnings. Not for one minute am I pretending that the initiative was an initiative of this National Government. We are very supportive of a very good initiative that is working in New Zealand and we can certainly recognise good things when we see them in action. But it is apparent that this National Government needs to sharpen the focus because the ministry will have to do so much more work and will have to be very very clearly focused on the people in our community who will need assistance. In this time of economic hardship when families are under stress we know that Child Youth and Family must be more responsive than ever before to the stress within families and to rising unemployment. Thank you. 
Hon PAULA BENNETT (Minister for Social Development and Employment) 
: 
 Mr Chairperson thank you for the opportunity to take a call on the financial review of the Ministry of Social Development. First of all I recognise the speech from Mrs Katene and her comments on youth unemployment particularly Maori unemployment and on how important that issue is. When we were discussing delegations we looked at where the commitment and interest were directed. Certainly from Minister Turia that interest was directed towards Maori unemployment rates and how she could help with employment which is certainly what she is knowledgable about. 
I assure the Committee and anyone out there who is listening that not a day goes by in a meeting with her that she does not mention whanau ora what that means and what she believes it can mean for Maori. We certainly support her in that area and we have some work to do on it over a period of time in order to get where we want to be. The fact is that if we keep doing what we are doing in respect of Maori unemployment we will keep getting the same results. In these tough economic times that will mean more Maori falling by the wayside. We are very aware of that and know that we have to look at some different initiatives. 
I am heartened by the Youth Guarantee and the youth transition services. We have seen some of them working quite well in the past and we have an opportunity to do some of them a bit differently in order to get them back to grass roots to give a level of flexibility to different communities and to see how they run unemployment for those young people and how they look at that transition. The reality is that some young people may need only a little help and others will need a lot more help. We need to have those sorts of contracts with that sort of flexibility. That is where our attention will be going. 
There is no mistaking that the attention of this Government has been on unemployment numbers and on people who are losing their jobs hence within weeks we saw the ReStart package. It was only ever meant to be a backstop and targeted to those who need it most but we thought it was just so critical to lend that helping hand when people are at their most vulnerable and have just discovered that short sharp shock of losing their job. It was with a sense of pride that before Christmas we brought in that ReStart package to acknowledge that situation. 
Unemployment numbers are currently at about 36000. We expect that number to keep growing. We see it fluctuating from week to week. We saw a week about 2 or 3 weeks ago when we had about 960 new people on the unemployment benefit. That dropped back down again—thank goodness—last week. Seasonal workers are still coming through. The numbers we see at Work and Income New Zealand show that about 37 to 38 percent of people who are walking through the door to go on the unemployment benefit are actually doing one of the seminars or courses and then not needing to go on the unemployment benefit which is great news. To have those sorts of numbers turning over tells us that the labour market is still working. It may not be working perfectly—certainly we are seeing people lose jobs and I do not want to undermine that point—but we are here to offer assistance for those who need it. 
Before Christmas we moved another 60 people into the front line to work with people who are coming in to go on the unemployment benefit. We are in the process right now of moving about another 100 on to the front line. Not all of them are coming from the back office to the front; some are moving from different front-line office roles into that unemployment benefit role. We expect to do that again and to see more moving into that role. 
Our focus is very much on people keeping their jobs where possible but if that is not possible our focus is on those people getting a job as quickly as possible. It means that some people will have to shift their expectations sometimes salary-wise and in terms of what that job actually looks like but we believe in New Zealanders’ ability to dig a bit deeper and to come across with that real Kiwi grit. I actually think most New Zealanders want to work. They want to be providing for themselves and they have that sense of pride in looking after their own families. There has been a shift in Work and Income New Zealand to supporting those people in that respect so that there is a helping hand when they need it while ensuring that their focus is on getting a job and keeping a job—any job. That is what we have to do over these next few months which will just get tougher quite frankly. 
We are aware of the situation we know what we need to do and we have confidence in New Zealanders and their abilities—[ 
Interruption 
] We can hear a bit of harping coming from members on the other side. We saw a Labour Government that did nothing. For three consecutive quarters—that is three consecutive quarters—we saw unemployment rising. We saw numbers going up from March 2008 to November 2008 from 3.7 to 4.2. What did Labour do? Labour did nothing. That is the reality: Labour did nothing. In fact one of the members in this Committee was known to say that 29000 people losing their jobs was “not a bad thing”. We saw people losing their jobs under a Labour Government Labour members shutting their eyes and putting on their blinkers and nothing happening. 
Report noted. 
Department of Labour 
DARIEN FENTON (Labour) 
: 
 It is a pleasure to take a call on the financial review of the Department of Labour in this Committee stage. I will focus on three or four areas in the review report from the Transport and Industrial Relations Committee. Those areas were interesting to the Labour members of the select committee because they are about issues that have arisen in the operational period since the National Government was elected. 
I will start with the 90-day bill on probationary employment. One of the questions the select committee asked is what is happening with the 90-day bill. It asked what protection there is and what measurements there are for ensuring that the 90-day legislation is having if you like the desired effect although on this side of the Chamber we would say that the desired effect of the legislation is opposite to what we want. The select committee asked what protection and what advice the Minister of Labour Kate Wilkinson and her department are giving workers on this legislation. As far as we could tell from the answers from the Department of Labour the answer is none. Employers are certainly getting plenty of attention and advice including a make-up contract or employment agreement on the website about how they can implement this very very unfair and unreasonable law which by the way was passed under urgency before Christmas without select committee input. We on this side of the Chamber say the law is completely unnecessary and unfair. 
The other thing is that there are still many many outstanding questions about the 90-day bill—or about the resulting Employment Relations Amendment Act 2008. I must say that at the select committee the National members got quite upset when I called it the fire-at-will bill. However that is how it is known in the community by workers and that is what they will continue to call it. As I said I am concerned that there is nothing for workers. As far as we could tell there is no advice and no monitoring of how this Act is affecting workers. We cannot see anything and that was confirmed by the department. 
There are still many questions around the operation of the 90-day bill—or the fire-at-will bill. One is about its impact. This question has certainly been raised by members of the public coming to us and discussing with us issues around immigration and work permits. They have asked what happens if someone gets a work permit and then they get fired under the 90-day legislation and no reason is given because the boss does not have to explain what it means. What happens to those workers? We still have not had a satisfactory answer from the Minister about what happens to workers who are fired under the 90-day legislation who then go to Work and Income to apply for the benefit—or perhaps the wonderful ReStart package that we have heard so much about but that nobody seems to qualify for. What happens to them? The employer does not have to give a reason for why a worker has been fired. Under the current situation those workers are classed as “dismissed” and therefore have a 13-week stand-down period. 
The second issue I want to mention that came up in the report was the New Zealand Skills Strategy. We have heard in this House after questioning by members on this side of the Chamber that the Government is completely up in the air about this strategy. The strategy was carefully worked out between the New Zealand Council of Trade Unions Business New Zealand the Industry Training— 
Hon Paula Bennett 
: That is so last year. 
DARIEN FENTON 
: There we go. I invite the member to tell the Council of Trade Unions Business New Zealand and the Industry Training Federation that the strategy is so last year. The Minister Paula Bennett thinks everything is so last year because she has no new ideas of her own. That is disgraceful. 
The select committee asked the Department of Labour about what has happened to the New Zealand Skills Strategy and it was told that the department was holding resources on the strategy and awaiting advice from the Government. In fact that was the department’s answer on many of the strategies and things that the department has been working on. The Government has no idea. It does not understand skills implementation. It does not understand the need for skills development as part of our future. It was quite amazing; we have heard the Minister confirm that. 
The third thing in the report that I will mention was questioning from Labour members about the Pay and Employment Equity Plan of Action. If we cast our minds back those who have been around a while—and I have been around a while—will remember that the first thing the former National Government did when it was elected in 1991 was to get rid of the pay and employment equity legislation. Under this administration they have done exactly the same thing. 
MICHAEL WOODHOUSE (National) 
: 
 As we know the Department of Labour is funded through Vote Labour but its responsibilities are quite broad. They include responsibilities for Vote Immigration for Vote Employment and for the oversight of New Zealand’s accident insurance framework. It is on the last point that I will talk. One very important role of the Department of Labour is in managing expenditure on behalf of the Crown in Vote ACC. More than any other this vote represents the woeful mismanagement of Crown resources by the previous Labour Government on behalf of the people of New Zealand. 
I certainly do not blame the Department of Labour for the huge blowout in accident compensation costs. In times past the department was the Crown’s watchdog in respect of the non-earners account. It is sad to see the systematic disempowerment of the department to a mere conduit between the Accident Compensation Corporation and the Minister and more significantly between former Ministers and the corporation. Labour Ministers had a plan to soften and to socialise the scheme and no amount of advice from the department on the cost implications to the non-earners account was even listened to much less taken. 
Once a watchdog the department was debarked under the previous administration. The list of ill-conceived poorly planned badly managed policies in accident compensation is a long and sorry one. They include among many others the massive opening up of the medical misadventure provisions now called the treatment injury account and I do not believe it has made one bit of improvement to the prevention of adverse events in health. The Department of Labour warned that the cost estimates were materially understated and that the changes would open a Pandora’s box. That advice was ignored and a budget of $8.7 million was put in place. What do we have now? We have a budget of $87 million and it is climbing. 
What has been the cost of these changes to the New Zealand taxpayer? Well the non-earners account alone is facing a $300 million increase this year and a massive $1.5 billion increase over the next 3 years. According to the recently tabled MartinJenkins report the deteriorating trend had been evident since 2005. It was evident in December 2007 when the Department of Labour provided the then Minister for ACC and the then Minister of Finance with the revelation that Vote ACC would be woefully inadequate to manage the scheme’s cost blowout. It was also evident again in May 2008 again in July 2008 and again on 18 August 2008 when the corporation advised the Minister for ACC that it needed additional funding of—wait for it—$305654000 in the 2008-09 year. 
The Labour Cabinet decided that such information should not be included in the Pre-election Economic and Fiscal Update. Why was that? It said that it was because the information had not been subjected to sufficient detailed scrutiny. I wonder what the previous Government actually wanted from the department. Perhaps the Swedish rounding system was in place and the department had failed to round the estimate up to the nearest 10c. 
What was the previous Labour Government’s response to the revelation? Firstly there was denial. Labour members said that there was no problem here and that it was just a glitch; it was Treasury’s fault or it was the fault of a downturn in the economy. That is nonsense. Yes a portion of the increase in the unfunded liability has been the result of the downturn in investment returns and changes to discount rates. But Labour has used the downturn to mask its failure on accident compensation. High investment returns early in its term of Government masked poor performance and now it attempts to mask its woeful performance in the last 2 years by blaming the downturn. 
Does the previous Government even care? Well not if the comment by the Hon Ruth Dyson in a recent financial review is anything to go by. After a simple question on financial performance Ms Dyson asked me why I was so fixated on deficits. Well I tell that member that deficits are bad big deficits are really bad and accident compensation deficits are terrible. I am pleased to be part of a Government that understands that that will expect the Department of Labour to turn things round and that will change the softening policies of the previous administration. 
Hon Dr Jonathan Coleman 
: Mr Chairperson— 
The CHAIRPERSON (Eric Roy) 
: I have a little difficulty Mr Coleman in that it is my understanding that there is some kind of proportionality between the calls. The only call left now for National are for the Ministers in the chair. I think the Hon Kate Wilkinson rose to her feet at the same time so I will honour that call. 
Hon KATE WILKINSON (Minister of Labour) 
: 
 It is my pleasure to be the Minister in the chair for the debate on the 2007-08 financial review of the Department of Labour. I thank my colleague Mr Woodhouse for outlining some of the legacy that has been left by the previous Labour Government in the area of accident compensation. It is a shame that the Minister of Immigration Dr Coleman could not also elaborate on the tragic legacy left by the previous Labour Government in the field of immigration. 
In the field of industrial relations and labour I would like to answer some of the questions by the member who spoke earlier Darien Fenton. I thank her for those questions. I must say though that those questions have been answered several times before but I appreciate that sometimes memories are very short in this Chamber. Ms Fenton was fixated—and has been for some time—on the 90-day probation legislation which was introduced as we all know last year. That was a great bill. That bill was welcomed by businesses. It has been welcomed actually by workers who can now knock on the door of an employer and say: “Give me a chance. I have not worked before.” or “I’ve had a bit of a break in my employment. Please give me the opportunity and I will prove myself.” 
That legislation actually works. I was talking to representatives of the Equal Employment Opportunities Trust which was I have to say set up by a National Government and they said it was a great bill. They were concerned about barriers to employment. The 90-day trial period will lift those barriers. Darien Fenton asked what sorts of protections are in place. That member knows full well—she has the ability to read the legislation—that plenty of protections are in place. We are concerned to balance what is fair to both the employee and the employer. If one looks at the protections—and we can repeat them day in day out and one day they might sink in to the Labour Party—we see that the good-faith provisions still remain. They are untouched. So the employer still has to act in good faith. Secondly employees must agree to that 90-day trial. If they do not want it they do not have to have it. That is called choice. Their rights in relation to discrimination still remain. 
We have also put in additional protection so there cannot be an 89-day rollover if one likes. So a 90-day trial period will apply only once. Furthermore we have limited it to those small businesses with 20 employees or fewer because those businesses are least likely to have the human resources capability to make those recruitment decisions. In relation to benefits if a person on a benefit gets a job with a 90-day trial period and that trial period does not work out then the stand-down period will not apply. We see this as a real positive in these times of economic challenges. That provision will give people on a benefit some confidence to get on the job market and say “Give me a try.” If it does not work they still have the safety net of the benefit and therefore they do not miss out. 
If we are looking at protections we can see that we now have one from the New Zealand Council of Trade Unions. We welcome this. The New Zealand Council of Trade Unions has come up with a “name and shame” campaign and we welcome that campaign if it is against unscrupulous employers who are not complying with the law. We will not welcome it though if it tries to take any action against law-abiding businesses that are just trying to get ahead employ people and survive these economic times. 
The National Government appreciates the importance of workers to businesses but we also appreciate the importance of businesses to workers. We want employment law that is fair. We recently increased the minimum wage by 50c. It is interesting that when Labour increased the minimum wage by 50c it was generous but when the National Government increased it the Labour Party said it was mean measly and miserable. 
Hon Ruth Dyson 
: You said “Do nothing” in your Cabinet paper. 
Hon KATE WILKINSON 
: We had three recommendations to increase the minimum wage. We increased the minimum wage which resulted in more workers getting an extra $20 a week in their pocket. 
Report noted. 
Department of Internal Affairs 
Hon PETE HODGSON (Labour—Dunedin North) 
: 
 When the Minister of Internal Affairs went to India in February of this year returning I think on 2 March of this year he did a range of things that by the kindest analysis could be described as unusual. First of all— 
Nathan Guy 
: Point of order— 
The CHAIRPERSON (Eric Roy) 
: I know what the point of order is. Before we commenced this debate I read an instruction to the Committee and let me just remind the member that this debate on the Government’s financial position may be a wide-ranging one but debates on the individual financial reviews of departments and Offices of Parliament and non-departmental appropriation should be relevant to their performance in the 2007-08 financial year and their current operations. So the member must confine himself to the departmental report on that period. 
Hon PETE HODGSON 
: In respect of the current operations of the Department of Internal Affairs the Minister was in charge for example of the New Zealand Fire Service as part of his duties. It was when he was in India that Australia was alight with fires and indeed a bunch of firefighters had gone to Australia in that time. Then on his return the Minister who is shouting uncontrollably from the chair released a press statement to say that the second batch of firefighters was to go to Australia. This proves my point that the Minister of Internal Affairs has something to do with firefighting in Australia—except he was in India at the time. 
The first unusual thing was that the Minister went to India during the Government’s 100 days of action— 
The CHAIRPERSON (Eric Roy) 
: This debate is not about the Minister’s conduct; it is about the department. The member will contain himself to those issues. 
Hon PETE HODGSON 
: On the Minister’s departure date to India—on 24 February—his department opened a website about births deaths and marriages. The Minister put out a press statement about the births deaths and marriages website on 24 February or thereabouts; and on the day of his return the Minister put out another statement about further activity within the Department of Internal Affairs which was about the second tranche of New Zealand firefighters going to Australia to help put out the fires. In the meantime the Minister put out no press statements about the ongoing activities of the Department of Internal Affairs because he was not around. What is more he never put out a press statement to say he was not around. So no doubt most people thought that the Minister of Internal Affairs was still in New Zealand running the Department of Internal Affairs when he was not. He bookended his trip with a press statement about a website on births deaths and marriages on his departure and another press statement about the— 
Nathan Guy 
: I raise a point of order Mr Chairperson. This financial review is about the department’s performance in the previous 12 months. This member is straying well outside the mark. I suggest to you Mr Chair that you rein in the speaker and remind him about this debate. 
Hon Darren Hughes 
: I am very surprised Mr Chairperson that a good 3½ hours into the debate there is now quite active refereeing of what should be in and what should be out with regard to what members are saying. I point out that the Department of Internal Affairs is responsible for Ministerial Services for Ministers’ staffing and for the facilitation of Ministers through customs at airports. That is the point my colleague was trying to get to but he has been stopped a couple of times by you Mr Chairperson and then by interference from the Government. This is the first time in the debate that a Minister has been protected in this way. 
The CHAIRPERSON (Eric Roy) 
: The member will please sit. It is not the first time in the debate. I have already ruled that one member was getting outside the realm of the debate. The reason there has not been any other such ruling is that members have stayed inside— 
Hon Darren Hughes 
: No they haven’t. 
The CHAIRPERSON (Eric Roy) 
: Well they have while I have been in the Chair. 
Hon Darren Hughes 
: It’s not been right while you haven’t been here. 
The CHAIRPERSON (Eric Roy) 
: Well irrespective members know that if there is an issue it should be raised at the time. The issue is clear here. The Minister’s conduct or perceptions thereof is not at issue. It is about the department’s performance. 
Hon Clayton Cosgrove 
: Speaking to the point of order— 
The CHAIRPERSON (Eric Roy) 
: No I have ruled on the point of order. 
Hon Clayton Cosgrove 
: I raise a point of order Mr Chairperson. It is a new point of order. In the light of your comments you may wish to reflect on the part of the financial review in respect of the Department of Corrections. Without rehearsing that in that debate for instance reference was repeatedly made by a number of speakers to the Minister’s relationship with the chief executive which forms part of Standing Order 334(1) which includes current operations. I am not sure who was in the Chair at the time but that was ruled as being completely correct. It was a contemporary issue it was current operations and it was direct ministerial conduct in respect of the chief executive. With respect I fail to see how you can rule out my colleague because exactly the same points are being made about the current operations. My colleague Mr Hughes has talked about Ministerial Services for which the Minister is responsible. I ask you Mr Chairperson for some consistency. 
The CHAIRPERSON (Eric Roy) 
: I will reflect on the point that the member makes and if I deem that any member is outside the range of what must be debated then I will rule it out of order. 
Hon PETE HODGSON 
: The trip to which I am no longer allowed to refer was unusual in this respect: the Ministerial Services facilitation of Dr Worth at least on his arrival back through Auckland was in conflict one could argue with the fact that he was travelling as a private individual and not as a Minister. However— 
Hon Dr Jonathan Coleman 
: I raise a point of order Mr Chairperson. The member continues to trifle with the Chair. You have ruled on the matter; he continues to ignore your ruling. I think you have to take action because frankly he is determined to ignore you completely. You have to assert your authority otherwise it looks like the Chair— 
The CHAIRPERSON (Eric Roy) 
: It is out of order to tell the Chair to assert his or her authority. That is out of order. I am listening very carefully to what the member says. I think we have made that point. I will now monitor it as I do with every other speaker. 
Hon PETE HODGSON 
: Let us take a look at the facilitation services that are provided by Ministerial Services which is part of the Department of Internal Affairs and let us ask ourselves—[ 
Interruption 
] Those members cannot shut me down with points of order any more so they are going to try pure volume and the problem is I have the microphone. The fact of the matter is that it is unusual for a private individual to be facilitated and to have the car draw up at the airport. That is an unusual thing for Ministerial Services to do but on the occasion of the Minister of Internal Affairs returning to New Zealand that is exactly what happened. Private individuals were facilitated across the tarmac by Ministerial Services. Whether this happened at all during the year under review I am not sure but I do know that it is a current operation because it was done for the Minister of Internal Affairs and for a couple of his rough mates who went on the trip with him. 
Hon Dr Richard Worth 
: Wrong wrong! 
Hon PETE HODGSON 
: What is more the Minister is now losing his cool. He is yelling into the microphone. You will have to bring him under control Mr Chairman. Oh he has got him under control; that is great. Let us look then at whether that action of Ministerial Services is a normal activity or whether that is an unusual activity for the Department of Internal Affairs. I would assert that it is unusual. I am sure it has happened before but probably with a trade mission led by a trade Minister not with a trade mission led by the Minister of Internal Affairs travelling privately and forgetting to tell his boss that he had a conflict of interest about which I may not talk. 
There is another matter that arises in respect of Ministerial Services and that is I cannot find any record of who was the Minister of Internal Affairs in New Zealand when the Minister of Internal Affairs was not in New Zealand because as soon as he goes through the 12-mile limit there is supposed to be some other Minister and Ministerial Services did not put out a press statement about that. 
Hon Dr RICHARD WORTH (Minister of Internal Affairs) 
: 
 The Department of Internal Affairs is the mother of all departments. It has direct descent from the days of the Colonial Secretary and this mother gave birth in due course to public works justice health and social welfare and continues to manage a diverse array of functions. The modern department is very much part of the fabric of New Zealand society. It touches the lives of citizens literally from birth to death and supports every community. 
All members will be keenly aware of the challenging economic environment in which we find ourselves. This new Government is focused on steering New Zealand through the global recession. To do that we are obviously looking for everyone to play their part and the Department of Internal Affairs is focused on this. 
In the context of this debate I would like to overview and highlight what has occurred in the past reporting period which is the topic of this debate. The department’s responsibilities are closely related and are in the areas of critical importance for our future—security safety identity local government and community. All these responsibilities contribute to the department’s purpose of “serving and connecting citizens communities and government to build a strong and safe nation.” 
If I look at the financial overview for 2007-08 I see that expenditure for the department is appropriated through six different votes and covers a wide range of services and activities. Just to take last year for example the department’s revenue totalled $215.2 million with 56 percent of that revenue or approximately $120.6 million coming from third-party sources such as fee income. 
If I could talk just for a moment about the departmental initiatives then I would say to members tonight that the highlights of work within the internal affairs portfolio include first of all passport redevelopment. The plan as members may know is to introduce a new passport book and a processing system for better service and security. This is now a virtually constant process of improvement in meeting international demands. 
Another area that we are involved in is anti-spam. The department is making progress on fighting spam. It will not of course stop spam but there is the hope that it will be able to say with some confidence that a spam operation cannot be run in this country without detection and prosecution. 
Then there is also the third area the report of the Royal Commission of Inquiry into Auckland’s Governance. As well as having responsibility for this work as part of its local government activities the department in the last period provided administrative support to the royal commission during 2007-08 and until the report was released at the end of March 2009 as part of its executive Government support role. 
A lot of work is also being done on centralisation work within the department. The department is more efficient because it has been centralising business functions like human resources and information technology. 
Hon Clayton Cosgrove 
: Old Tories being caught out eh? 
Hon Dr RICHARD WORTH 
: As members might know and that member in particular will know one of the new challenges for the department is to take on this aspect of Government Technology Services. Government Technology Services is transferring to the department creating an information technology shop of considerable size and skill. I hope there may be a really good opportunity to advance the causes that are so critical in the context of interoperability of computer services. A whole lot of legacy decisions are now coming to maturity and we need to make decisions that will enable the prospect of interoperability of computer systems within the Government service. 
If I were to highlight the work of the department in other portfolio areas I would say these things. First of all the work that was done in connection with the civil defence exercise which some members will remember—Exercise Ruaumoku—was highly successful. It played a big part I believe in raising awareness of the volcano threat. Also in this same period was the Edmund Hillary funeral and the department was able to use its expertise in the organisation of that service. 
CHRIS HIPKINS (Labour—Rimutaka) 
: 
 I am happy to take a call on the financial review of the Department of Internal Affairs. I would like to talk in particular about Ministerial Services and about the fact that Ministerial Services employs the staff who work in Ministers’ offices who among other things organise ministerial travel and prepare draft answers to Ministers’ written questions. We know that they are paid significantly more under this National Government than they were paid under the last Labour Government so one would think we would get a higher output. I am not convinced. One of the ways that we can hold departments and Ministers to account is through the asking of written questions. I have asked many questions of the Minister of Internal Affairs which he continues to refuse to answer. He says it would take too many resources to answer them. He will not say whom he has met with and he will not say what reports he has received. I have to wonder why that is. What exactly is he trying to withhold? 
The other thing that I would like to talk about is VIP Services provided through Ministerial Services and in particular the facilitation of Ministers at airports. It would be very inappropriate would it not for a Minister to use those facilitation services provided by the Department of Internal Affairs to shepherd his or her business cronies— 
Hon Clayton Cosgrove 
: Mates. 
CHRIS HIPKINS 
: —business mates—through immigration so that they could go prospecting for business overseas for companies that the Minister himself has an interest in. 
Report noted. 
Clauses 1 to 9 and schedules 1 to 4 agreed to.  
Bill reported without amendment. 
Report adopted.