Volume 709 Week 32 - Thursday 5 November 2015Text is incorporated into the Bound VolumeVolume 709 Week 32 - Thursday 5 November 2015[Sitting date: 05 November 2015. Volume:709;Page:7735. Text is incorporated into the Bound Volume.]Thursday 5 November 2015Mr Speaker took the Chair at 2 p.m.Prayers.Business StatementHon SIMON BRIDGES (Acting Leader of the House): When the House resumes on Tuesday 10 November the Government will look to make progress on a number of bills on the Order Paper including the Support for Children in Hardship Bill and the International Finance Agreements Amendment Bill. Wednesday 11 November will be a members’ day.Points of OrderPersonal Reflections and Unparliamentary Language—References to Members’ EthnicityDAVID SEYMOUR (Leader—ACT): I raise a point of order Mr Speaker. It is with specific regard to Standing Order 120 “Personal reflections”. May I preface this point of order by saying I understand that points of order should be raised at the first available opportunity. In light of these circumstances that is what I am doing. I think Mr Speaker that you will see that the nature of this issue says that it must be dealt with.On Tuesday night during the shop trading hours debate a member told two other members that if they do not like New Zealand they should go back to the countries whence they came. I believe that this brings this House into serious disrepute—that an elected New Zealand citizen should be reflected upon personally and have views imputed upon them according to their ethnic background. That is wrong. That is a disgrace. The member must stand withdraw and apologise.Mr SPEAKER: I thank the member for his point of order. I am aware generally speaking of the debate. It was certainly a heated debate. I think there were some comments made at the time that were not interrupted by a presiding officer. I think those comments were very unfortunate but the matter has now passed. It is not an issue that I can rule on at this stage.David Seymour: Speaking to the point of order.Mr SPEAKER: I have spoken to the point of order. If the member has a fresh point of order he can raise it but I have made a decision in that regard. Is it a fresh point of order?David Seymour: Only that—Mr SPEAKER: No. I am just warning the member—I do it with all sides of the House—that I have litigated that and the time is past. It is an incident that I think is regrettable it has occurred but I can do no more about it now that it is 24 hours on.DAVID SEYMOUR (Leader—ACT): I seek leave for the member to make an apology—Mr SPEAKER: Order! No. The member cannot seek leave on behalf of another member. [Interruption] Order! [Interruption] Order! No the member will resume his seat. Equally those people sitting near Mr Seymour should not carry on a conversation across the floor of this House.Leave to Move Motion Without Notice—Anniversary of Typhoon HaiyanCATHERINE DELAHUNTY (Green): I raise a point of order Mr Speaker. I seek leave to move a motion without notice and without debate to recognise the second anniversary of the strongest tropical cyclone in recorded history Typhoon Haiyan—Mr SPEAKER: Order! You have described what you are seeking leave for. I will put the leave. Leave is sought to move that motion without debate. Is there any objection? There is objection.Questions to MinistersWage Rates—Reports1.JACQUI DEAN (National—Waitaki) to the Minister of Finance: How does growth in the average wage compare to cost of living increases of 0.4 percent over the last year according to labour market data released by Statistics New Zealand yesterday?Hon STEVEN JOYCE (Associate Minister of Finance)on behalf of theMinister of Finance: Data from Statistics New Zealand yesterday shows that the annual average wage is now over $57300 which is over $10000 more than when National first came into office in 2008. Over the last year wages have increased by 3.1 percent which is considerably higher than the rate of inflation at just 0.4 percent. Of course the 0.1 percent increase in unemployment to 6 percent is higher than we would like it to be but we should note that although the household labour force survey noted the first quarterly fall in jobs in 3 years the quarterly employment survey released on the same day recorded filled jobs increasing by 0.7 percent and hours worked increasing by 0.9 percent.Jacqui Dean: What is the Government doing to assist firms to grow jobs and deliver higher wages?Hon STEVEN JOYCE: The Government recognises of course that it is businesses that create jobs and what the Government does is to create an environment and a platform from which businesses can have the confidence to invest and employ more people. That is what this Government is doing—for example by reducing income taxes to increase incentives to work reducing ACC levies spending $110 billion on infrastructure over the next 10 years and negotiating the Trans-Pacific Partnership and also the New Zealand - Korea free-trade agreement. In all the Business Growth Agenda has nearly 500 initiatives in it and these are all being used to encourage—[Interruption]Mr SPEAKER: Order! There are five people to my left who have been consistently interjecting since question time started. If any of those five—and I am happy to name them if they are in any doubt as to who they are—continue to interject then they will be asked to leave the Chamber. Does the Minister wish to complete his answer?Hon David Cunliffe: I raise a point of order Mr Speaker. I confess that I was one of the five and part of the reason for the disorder—Mr SPEAKER: Order!Hon David Cunliffe: But the point of order—Mr SPEAKER: I want the point of order.Hon David Cunliffe: —is: what guidance can you give the House about the maximum duration of ministerial responses?Mr SPEAKER: I have given that guidance on many occasions and I am sure that the member has been here. I am the sole judge as to the length of answers.Jacqui Dean: What does the recent data show about businesses’ hiring intentions particularly in respect of the services and manufacturing sectors?Hon Steven Joyce: As I mentioned earlier this week we saw weak economic growth in the first half of the year in part due to the significant fall in dairy prices. More recent data points have been more positive including last week’s ANZ Business Outlook survey. That survey reported higher investment intentions increased employment intentions higher profit expectations and a lift in residential investment intentions. Other data indicates that the services sector is seeing the largest expansion in activity in 8 years and we have now seen a record 36 consecutive months of growth in manufacturing. There are of course risks to the outlook from the weak global economy but overall the country remains on track for continuing moderate growth.Jacqui Dean: What does the latest data from Statistics New Zealand show about employment outcomes for young people?Hon STEVEN JOYCE: The data released yesterday shows that the outcome for young people is increasingly positive with the number of 15 to 24-year-olds not in employment education or training down to 11 percent which is the lowest level in 7 years. Within that the figure for 15 to 19-year-olds has fallen to the lowest level ever recorded in the survey—it is the lowest level ever recorded. It is particularly positive that this fall is due to more young people participating in education.Security Intelligence Service—Visual Warrants and Legislative Compliance2.JAMES SHAW (Co-Leader—Green) to the Minister in charge of the NZ Security Intelligence Service: Does he have confidence in the NZSIS in light of the Inspector-General of Intelligence and Security’s conclusion that the agency did not have “sound compliance procedures and systems in place”; if so why?Hon CHRISTOPHER FINLAYSON (Minister in charge of the NZ Security Intelligence Service): Yes because the SIS is making very good progress towards improving its compliance procedures and systems—something that the inspector-general acknowledged in her report.James Shaw: When was the Minister first made aware that the SIS had breached the law by not providing a copy of the visual warrants to the inspector-general as referred to in her report?Hon CHRISTOPHER FINLAYSON: From memory about a fortnight before the inspector-general released her report.James Shaw: Was it the inspector-general or the SIS who told the Minister that the SIS had breached the law by not providing a copy of the visual warrants to the inspector-general as referred to in her report?Hon CHRISTOPHER FINLAYSON: It was the SIS itself because the director in her weekly meeting with me mentioned it and formally apologised to me.James Shaw: Will he remove the new visual surveillance powers that he granted the SIS given the finding that it has misused these powers 100 percent of the time?Hon CHRISTOPHER FINLAYSON: Well that is in fact totally wrong. I am not some kind of Joe Stalin who can simply remove the provisions of a statute—Grant Robertson: It’s an aspiration though Chris isn’t it?Hon CHRISTOPHER FINLAYSON: It may be an aspiration. That is the job of Parliament. What I can say is that the inspector-general has done a very good job. The SIS has undertaken to improve its procedures. One thing I can say to the honourable member is that the relevant section talks about doing things as soon as practicable which is a very flexible and frankly unsatisfactory term. I think the language needs to be tightened up but these and other matters can await the review which is shortly to be released.James Shaw: How many people have been wrongly denied security clearance because the SIS failed to follow its legal obligation of procedural fairness?Hon CHRISTOPHER FINLAYSON: Well I cannot answer that. What I can say is that deficiencies have been identified in the vetting procedure which goes back many years and these issues are being addressed by the SIS and by the director. I have great confidence in the director to put things right. Just last week for example I was having a meeting with vetting staff about ways in which the vetting procedures could be improved.James Shaw: Will he instruct officials to reassess those New Zealanders who have been wrongly denied security clearance because the SIS failed to follow its legal obligation of procedural fairness?Hon CHRISTOPHER FINLAYSON: I do not know whether I can get myself involved in operational matters. What I can say is that the director who is a very careful and professional woman is looking at those issues right now.James Shaw: Will the director of the SIS face any consequences for the breaches of law that have happened on her watch?Hon CHRISTOPHER FINLAYSON: I am not into witch hunts. I am more interested in putting things right as LV Martin used to say. It is extremely important that these lapses be addressed in a professional and thorough manner and as I have said I have great confidence in the director to do exactly that.District Health Boards—Funding Deficits3.Hon ANNETTE KING (Deputy Leader—Labour) to the Minister of Health: What did he mean by his statement on 29 July that core Crown health expenditure since 2009/10 covers “most but not all inflationary pressures”?Hon Dr JONATHAN COLEMAN (Minister of Health): I have answered this question many times and I mean exactly that—it does cover most but not all inflationary pressures. The balance is found within baselines by redirecting spend from areas where it is not delivering results to areas where it is delivering the results that New Zealanders need and expect.Hon Annette King: If the district health boards are meeting cost pressures from within their baselines why have 13 district health boards exceeded their budget by $8.4 million in August alone?Hon Dr JONATHAN COLEMAN: Actually it is a huge improvement. The collective district health boards’ deficits are about $50 million at the moment—a big improvement from the $150 million we inherited from Labour. So Labour knew how to run a deficit; it did not know how to deliver the services.Hon Annette King: If district health boards are managing their cost pressures because there is enough funding why is the National Health Board meeting with the Lakes Tairāwhiti Capital and Coast Hutt Valley and MidCentral district health boards to discuss their financial performance?Hon Dr JONATHAN COLEMAN: Because unlike Labour we are not going to let the deficits blow out.Hon Annette King: I raise a point of order Mr Speaker.Hon Dr JONATHAN COLEMAN: I am answering the question.Mr SPEAKER: Order! A point of order has been raised.Hon Annette King: That was a very straight question; he goes straight to the Labour Party. Why does he not answer his own questions?Mr SPEAKER: It was certainly not helpful the way the Minister started but it would be helpful if the Minister could answer the question and then we will judge the adequacy of the answer.Hon Dr JONATHAN COLEMAN: Because we are not going to let deficits blow out. We cannot go back to the situation back in 2008 of a $150 million deficit. I see Mr Robertson saying today that actually he is prepared to run deficits if he ever becomes the Minister of Finance which would be a massive problem for the health system and New Zealand.Hon Annette King: If all district health boards’ inflationary pressures are basically being covered as the Minister is telling us why did the figures provided by his office show a shortfall of $152 million in this financial year?Hon Dr JONATHAN COLEMAN: As usual Mrs King is not giving the full picture. The picture that she is painting is an early Budget document. The rate of inflation changed considerably from that time so she is using out-of-date information but worse she knows it.Hon Simon Bridges: Annette!Hon Annette King: I raise a point of order Mr Speaker.Hon Simon Bridges: You shouldn’t do that.Hon Annette King: Yes it is Annette; that is right.Mr SPEAKER: Order! A point of order—the Hon Annette King.Hon Annette King: I have a written answer to the Minister—not using ministry figures.Mr SPEAKER: Order! Can I have the point of order?Hon Annette King: The point of order is that I would like to table the written answer because the Minister disputes my figures.Mr SPEAKER: The Minister certainly did dispute the figures but that is a debatable matter. If it is a published written answer then it is available to all members anyway.Hon Annette King: Were the figures supplied by his office correct when they showed that nine district health boards will need $61.4 million out of their budgets this year to manage the Government’s shortfall in funding?Hon Dr JONATHAN COLEMAN: It is a heck of a lot better than their needing $150 million and we are determined to make sure that the deficits do not blow out. If you look at the wider fiscal strategy we are determined that district health boards live within their means. We are not going to do like Grant Robertson is promising which is to run deficits to fund health—a very bad idea.Hon Annette King: If district health boards are being funded for all their cost pressures why have 73 percent of staff recently surveyed at the Taranaki District Health Board reported that in the past 6 months patient care or treatment has been compromised?Hon Dr JONATHAN COLEMAN: I have not seen that survey but look I would not be surprised if it is not exactly saying what Mrs King is saying it does. What she is saying—Hon Annette King: Point of order Mr Speaker.Hon Dr JONATHAN COLEMAN: —in her—Mr SPEAKER: Order! There is a point of order. The Minister will resume his seat.Hon Annette King: I seek leave to table the said survey from the Care Capacity Demand Management programme—Mr SPEAKER: Order! I will put the leave but—[Interruption] Order! I will put the leave but it is customary certainly in this House to do so at the end of an answer. But I will put the leave certainly in view of the circumstances. Leave is sought to table that particular survey—Hon Annette King: Have a read.Mr SPEAKER: Order! I might if I have time.Leave is sought to table that particular survey. Is there any objection? There is none. It can be tabled.Document by leave laid on the Table of the House.Hon Dr Jonathan Coleman: I raise a point of order Mr Speaker. We just had a situation there where I was asked a question I was halfway through my answer and you allowed Mrs King to table a document—Mr SPEAKER: Order! [Interruption] Order! The Minister will resume his seat. That is not exactly as it happened at all. A member has a right to raise a point of order at any stage but—[Interruption] Order! If the Minister wishes to stay in the House he will not interrupt while I am on my feet. The member has a right to raise a point of order at any stage. At the time I accept the point of order I have no idea what that point of order is. Subsequent to accepting the member having the right to raise a point of order she then took the opportunity to seek leave to table a document. I did point out to her that it is not the custom of the House to interrupt an answer to do so but in view of the circumstances once the interruption had occurred I allowed the tabling to proceed. Question—[Interruption] Order! We do not need further interjections between the two members.Budget 2015—Beneficiaries and Case Management4.JONO NAYLOR (National) to the Minister for Social Development: What is the Government doing to support beneficiaries to find work as part of Budget 2015?Hon ANNE TOLLEY (Minister for Social Development): Today I announced that 40000 more intensive case management places have been made available for beneficiaries following the funding boost in Budget 2015. The increase means that the number of clients supported has increased from 80000 to 120000. These increased services will be focused for sole parents and for jobseekers with health conditions and disabilities who want to work but need some extra support and guidance.Jono Naylor: How does work-focused case management fit within the Government’s plan in Budget 2015 to support New Zealanders off benefits and into work?Hon ANNE TOLLEY: Work-focused case management is just one of the tools that this Government is using to support New Zealanders off welfare. Budget 2015 also includes initiatives such as expanding the 3K to Christchurch scheme and increasing funding for the out-of-school care and recreation childcare subsidy to remove barriers for parents moving into work. We have already seen the number of children in a benefit-dependent household reduce by over 42000 in the past 3 years and the number of sole parents on a benefit is down by almost 22 percent over that same time. This Government is doing more to try to help these clients off welfare and into work so they and their families can lead successful lives.Darroch Ball: How can she say that she is supporting youth beneficiaries into work when she is contributing to the rise of youth unemployment to a shameful 22 percent by reducing funding for the likes of the highly successful youth Limited Service Volunteers programme?Hon ANNE TOLLEY: Well on the contrary of course we can say that we are supporting young people into work and off benefits. We have a very successful youth services programme that provides wraparound intensive support to young people and we have the Limited Service Volunteers scheme which is a suitable scheme for a number of young people. We increased the numbers during the global financial crisis because more young people were out of work. Now that the crisis is over we have restored it to its original numbers and we are continuing to use it in partnership with the Defence Force.Employment Rate—Reports5.GRANT ROBERTSON (Labour—Wellington Central) to the Minister of Finance: What was the rate of unemployment and the total number of people unemployed according to the household labour force survey when he took office and what is that rate and that number now?Hon STEVEN JOYCE (Associate Minister of Finance) on behalf of theMinister of Finance: The data from Statistics New Zealand yesterday shows that the unemployment rate is currently 6 percent. This is 0.1 percent higher than the previous quarter and compares with 4.6 percent at the end of 2008. The number of employed people is 2347000 in the household labour force survey yesterday compared with 2195000 at the end of 2008. The number of people unemployed is currently 151000. At the end of 2008 it was 105000. Of course in the meantime we have had a number of moderately significant world events: the global financial crisis in New Zealand’s context the Canterbury earthquakes and of course this year a fragile world economy that has seen significant drops in commodity prices including in one of the commodities most important to New Zealand.Grant Robertson: Is it correct that the lowest unemployment he has got on his watch is 5.4 percent or 138000 people out of work?Hon STEVEN JOYCE: I cannot verify the exact figures for the member but I can say that across the world it has been more difficult to generate employment post the global financial crisis than prior to the global financial crisis and the member may be aware of that.Stuart Smith: What recent reports has he seen showing how regional economies are supporting new jobs and more investment?Hon STEVEN JOYCE: Businesses throughout New Zealand continue to invest and employ more people. Just this morning I saw a report showing a number of companies in the Clutha district advertising to Dunedin jobseekers to fill up to something like 350 vacancies. Then of course there are companies like Proliant in Feilding where we are seeing “new investment creating new jobs making the most of Manawatū’s strengths”. That statement which came just a couple of hours ago is promoting the Government’s work for the council and Spearhead Manawatu in bringing Proliant to New Zealand and that was from a Mr Lees-Galloway. It is important that we recognise that businesses around the country are continuing to invest and hire and the Government is helping them to attract new investment to regions around the country.Brett Hudson: How is the Government supporting jobs and diversification as part of building a resilient New Zealand economy?Hon STEVEN JOYCE: The Government is taking a range of measures to support a growing New Zealand economy. For example there is a lot of activity recently in free-trade agreements in the export market sector of our Business Growth Agenda with the Government signing up to the Trans-Pacific Partnership agreement. I am not sure whether all other parties in the House have yet formed a position on that but this Government certainly has because it will help job growth in the regions. We have reduced taxes on work supporting higher employment we have maintained a 90-day trial period which encourages more jobs and we are investing in new public assets using the $4.7 billion raised by the mixed-ownership model which of course has been opposed by some other parties in the House. We have cut red tape to get more houses built and there are any number of further initiatives: the innovation initiatives the infrastructure initiatives the water storage initiatives—Mr SPEAKER: Order! Bring the answer to a conclusion.Hon STEVEN JOYCE: —many of which are opposed by other parties in this House.Grant Robertson: Why did he say that 151000 New Zealanders being out of work was “to be expected” and does that mean that unemployment at that level is collateral damage in his hands-off style of economic management?Hon STEVEN JOYCE: I think the answer to the supplementary question previously shows that this Government is anything but handsoff notwithstanding Mr Robertson’s talking points. The reality is that New Zealand participates in a global economy and our job as a Government is to come up with a range of initiatives that assist further growth and investment. We have any number of them and if the member would like me to go through them all again given that he has not heard them and wrote his talking points without them then I am happy to.Grant Robertson: Can he confirm that the extent of the Government’s response to yesterday’s announcement was “for people to try harder to get work” as the Minister said on the radio this morning; and does he not think that the person in this instance who should be trying harder is him?Hon STEVEN JOYCE: I note that the Minister’s response was to a direct and different question from the one that Mr Robertson characterised but fair enough. But this Government is exactly focused on those things and the interesting thing is that the Business Growth Agenda is encouraging growth in our export markets; it is encouraging growth in innovation of companies which is criticised by the Opposition; it is encouraging growth in infrastructure which is criticised by the Opposition; it is encouraging greater availability of natural resources which is criticised by the Opposition; it is encouraging more investment—Mr SPEAKER: Order!Hon Nanaia Mahuta: Is the increase from 8.7 percent to 12.9 percent in Māori unemployment under his watch indicative of the Government’s plan for economic success; if so how many new jobs have been created for Māori?Hon STEVEN JOYCE: I do not have those exact numbers available for the member today but if she puts it down in a question to perhaps the Minister for Tertiary Education Skills and Employment I am sure he would be happy to answer that question on her behalf. But the important thing is that the Government has a range of initiatives working alongside the Māori Party with the Māori and Pasifika Trades Training Initiative for example and the Youth Guarantee programme. [Interruption] And the “neet” figures in New Zealand for 15 to 19-year-olds are the lowest—lowest—they have ever been and that is Māori Pasifika and every other ethnicity in New Zealand.Su’a William Sio: How will an unemployment rate for Pasifika people of 13.1 percent compare with 7.7 percent when he became Minister and the accelerating income inequalities and the lowest homeownership rate for Pasifika people that follow it create the brighter future the Prime Minister promised?Hon STEVEN JOYCE: I agree with the member that Pasifika unemployment is still too high and that is why the Government is focused on a range of initiatives that attract investment particularly in South Auckland where a lot of our Pasifika population lives. That includes areas such as transport infrastructure where we have made very big investments. It includes the investment into the Auckland University of Technology to ensure that it grows its campus and the very big investment in the Manukau Institute of Technology which is encouraging skills development for young people across South Auckland including young Pasifika.Jenny Salesa: How does the Minister think his measures to tackle youth unemployment are working given it is now 16.65 percent for all young people under 24 up from 10.95 percent when National came into Government in 2008?Hon STEVEN JOYCE: That member I am sorry is completely incorrect because the unemployment figure for young people should not be quoted because it is only unemployed as a percentage of those people who are at work. Every Government—and generally every responsible Opposition—quotes the “neet” figure because the “neet” figure refers to those not in education employment or training. So we will quote the “neet” figure which is the lowest it has been in 7 years at 11.0 percent and the 15 to 19 rate is the lowest it has ever been—and it should be celebrated not talked down by the Opposition.Canterbury District Health Board—Funding and Canterbury Recovery6.NUK KORAKO (National) to the Minister of Health: Can he confirm that Canterbury District Health Board is receiving an extra $16 million in funding which acknowledges Canterbury’s unique circumstances and will see the DHB break even for the 2015/16 year?Hon Dr JONATHAN COLEMAN (Minister of Health): Yes I can. The Government has decided to give Canterbury District Health Board an additional $16 million in funding to ensure that it is well placed to continue delivering high-quality services to patients. In response to issues that the district health board has raised with me I asked PricewaterhouseCoopers to carry out a financial review so as to gain a fuller understanding of the district health board’s position. The PricewaterhouseCoopers review found that although the district health board has a stable financial position drivers of future cost relate to the operating cost of the $1 billion hospitals redevelopment and the unique circumstances in Canterbury. The $16 million is in recognition of those cost pressures and it means that the district health board will break even this year.Nuk Korako: What other assistance has the Government provided Canterbury District Health Board as it rebuilds from the earthquakes?Hon Dr JONATHAN COLEMAN: The Government is investing heavily in Canterbury in order to assist the region to rebuild after the earthquakes. This week I visited the Burwood Hospital construction site which together with the redevelopment of Christchurch Hospital is a $650 million investment in Canterbury health facilities. In addition we have provided funding support totalling $70 million and have boosted mental health services and the district health board is delivering more services for patients such as the 50 percent increase in elective operation numbers.Hon Annette King: Why did he need to put PricewaterhouseCoopers into Canterbury District Health Board at considerable cost to the taxpayer to find out that it needed additional funding when the district health board told him and his ministry back in November 2014 of its circumstances but was disbelieved?Hon Dr JONATHAN COLEMAN: Because it was necessary to do the analysis.Tertiary Institutes—Monitoring and Investigation into Funding7.Hon DAVID CUNLIFFE (Labour—New Lynn) to the Minister for Tertiary Education Skills and Employment: On what date was he or his office first notified that Agribusiness Training Limited was seriously under-delivering its contracted teaching hours and/or receiving funds to which it had not been entitled?Hon STEVEN JOYCE (Minister for Tertiary Education Skills and Employment): Actually there are three key dates that I can provide to the members. As the member knows there were six tertiary education organisations that were specifically chosen for focused reviews late last year. No substantive issues were found with five of the six reviews but on 22 January this year the Tertiary Education Commission advised me that the Agribusiness Training Limited targeted review indicated there could be significant under-delivery of teaching hours of the sample programmes reviewed. The Tertiary Education Commission then engaged Deloitte to investigate Agribusiness Training Limited’s programmes between 2009 and 2014 and I was advised of its findings after Deloitte reported to the Tertiary Education Commission on 19 May 2015—I think I was advised in June. Finally having provided the findings to Agribusiness Training Limited itself for a response the Tertiary Education Commission requested repayment on 23 September this year and I was advised on or around this date.Hon David Cunliffe: Given that answer why did the Minister not disclose to Parliament the name or the nature of the issues at Agribusiness Training Limited when he had known for months about the issues?Hon STEVEN JOYCE: In the interests of natural justice I think it is important to see that the Tertiary Education Commission has the opportunity to engage with the provider and then inform me and then I was in a position to inform the House.Hon David Cunliffe: Why then was public announcement of the liquidation of Agribusiness Training Limited delayed several days until the Friday afternoon after Parliament had risen for the last adjournment—or was that just coincidence?Hon STEVEN JOYCE: I reject the insinuation in the member’s question but the point is that actually the liquidation of Agribusiness Training Limited came I believe as a surprise to both the Tertiary Education Commission and my office and actually the decision was taken to make a public announcement earlier in response to the liquidation. It was not a situation where the liquidation was delayed in any way shape or form. We were advised that it was liquidated and once the liquidation was announced we then proceeded to inform the public of some of the detailsas quickly as possible.Hon David Cunliffe: Given the considerable delays since the Minister was first notified of the problems with Agribusiness Training Limited on 22 January what action has been taken to prevent students from being left in the lurch with unfinished qualifications because of the failure of this private training establishment or to transfer them to other equivalent providers without loss of credit; if this has not been achieved for all students why not?Hon STEVEN JOYCE: Again I think the member is mischaracterising that particular January date. I have actually been through in my primary answer the order of events that occurred. In terms of the liquidation and the impact of that the New Zealand Qualifications Authority does have a process which is a very well-organised process to protect the interests of students. As I understand there is still to be a decision from the liquidator as to whether the organisation will continue to trade. Both the New Zealand Qualifications Authority and the Tertiary Education Commission are continuing to work very closely not only with that organisation but also with other organisations that may be needed in order to provide further education for the learners to ensure that the things the member is worried about do not actually come to pass.Hon David Cunliffe: When the Tertiary Education Commission selected a sample of providers to be investigated by Deloitte and PricewaterhouseCoopers what was the threshold for their third criterion—being “high numbers of course and qualification completion rates”—and how many providers in fact meet that threshold?Hon STEVEN JOYCE: The criteria for the six focused reviews were that the providers had some features in common with those found at Te Whare Wānanga o Awanuiārangi and the Western Institute of Technology at Taranaki. Those were rapid growth of individual courses coupled with unusually high completion rates and a high reliance on subcontracted provisioning. So it was the three things taken together that determined the level of interest in a focused review.Hon David Cunliffe: I raise a point of order Mr Speaker. I wish to draw to your attention the overdue reply to—Mr SPEAKER: Order! Can I just—Hon David Cunliffe: —written parliamentary question 133242015 to Minister Joyce in relation to—Mr SPEAKER: Order! [Interruption] Order! I will look into the matter.Tracey Martin: If Agribusiness Training and Taratahi Agricultural Training Centre have been proven to show provider rorts how confident is he that other providers are not rorting immigration given that 47000 foreign students have obtained residency here since 2008?Hon STEVEN JOYCE: I think it is a very big stretch for the member to say that just because a number of students have obtained residency in New Zealand there is by definition fraud. We actually have around 109000 international students studying in New Zealand every year and some of them do go on to obtain residency and—Tracey Martin: I raise a point of order Mr Speaker. I asked the Minister—Mr SPEAKER: Order! I heard what the question was. Would the member please show courtesy by giving the Minister time to answer it? Hon Steven Joyce—to complete the answer.Hon STEVEN JOYCE: I do not think it is unreasonable that there might be that sort of number over that period given the number of students who are studying here. I would add for the member that actually many of these students go on to make a considerable contribution to New Zealand—including sometimes marrying the locals.Security and Intelligence Agencies—National Security ConcernsRON MARK (Deputy Leader—NZ First): Thank you Mr Speaker. My question is to the—[Interruption]Mr SPEAKER: Order! [Interruption] Order! I will not hesitate to ask the member on my right-hand side to be leaving. The member has a right to ask a question.8.RON MARK (Deputy Leader—NZ First) to the Minister in charge of the NZ Security Intelligence Service: What is the Government doing to resource and address national security concerns identified in the ministerial briefing he received from the NZSIS and GCSB?Hon CHRISTOPHER FINLAYSON (Minister in charge of the NZ Security Intelligence Service): The Government is doing and has already done a great deal including changing the law to address the problem of foreign fighters something New Zealand First opposed; giving the SIS a funding injection of almost $7 million to increase the number of staff it has working on monitoring and investigating issues; giving both the New Zealand SIS and the Government Communications Security Bureau (GCSB) a funding boost of $20 million over 4 years for essential security services; continuing very important work on cyber-security to protect key New Zealand businesses and organisations; and working to improve oversight public engagement and openness.Ron Mark: Are the SIS and GCSB racist for making unchecked immigration their leading—[Interruption]Mr SPEAKER: Order! The member has a right to ask the question. Start the question again.Ron Mark: Thank you Mr Speaker. [Interruption]Mr SPEAKER: Order! I will not be issuing a further warning to interjectors from my right-hand side for the balance of this question. If members choose to interject they will be leaving the Chamber.Ron Mark: Are the SIS and GCSB racist for making unchecked immigration their leading national security concern?Hon CHRISTOPHER FINLAYSON: No they are certainly not racist. There are a number of national security issues and they are all being looked at competently and professionally by those organisations.David Seymour: Do these agencies have the ability to do sophisticated screening for threats or do they merely impute motives on New Zealand citizens according to their ethnicity and try to send them home?Hon CHRISTOPHER FINLAYSON: They certainly do not do the latter. The George Wallace or Enoch Powell approach to dealing with immigrants is not desirable.Ron Mark: Will the SIS GCSB and the Civil Aviation Authority be verifying all airport ID cardholders’ security clearances given the reports that the Russian airplane was probably brought down by a bomb; if not why not?Hon CHRISTOPHER FINLAYSON: I cannot say what the cause of that dreadful accident was; it is still being investigated. There is quite a lot of speculation. I can assure that honourable member and the House probably on behalf of the Minister of Transport actually that airport security is a huge issue and is constantly being looked at by the Minister and by his officials to ensure that we never have anything like that in this country.David Seymour: Are the agencies sufficiently resourced to detect whether racist attitudes are a security concern in New Zealand?Hon CHRISTOPHER FINLAYSON: Well there can be a number of security issues that arise. If for example there was a sort of KKK group—not referring to anyone in this House of course—that indulged in that kind of thing then that could well be a security issue and engage the interest of the SIS. But normally those sorts of matters are best dealt with by the Human Rights Commission unless and until a security issue arises or by people who make unfortunate statements having the bottle to stand up and apologise.Mr SPEAKER: Order!Ron Mark: Will the Minister tell the Minister of Immigration to halt special visa processing for elite China UnionPay credit card holders and elite status passengers of China Southern Airlines; if not why not?Hon CHRISTOPHER FINLAYSON: All I can say is that the Minister of Immigration my ministerial colleague is a very professional and competent person. I do not go around directing my colleagues what to do—that is the preserve of the Prime Minister—but I can assure that honourable member that the Minister of Immigration is alert to all security issues and approaches them in his usual competent and professional manner.David Seymour: Does the Minister or do the agencies view a correlation between racist attitudes and severely limited intellect as a security concern?Mr SPEAKER: Order! That question is not going to help the order of this House. Further supplementary question—Ron Mark.Ron Mark: Better to be an old lion than a young ass—Mr SPEAKER: Order!Ron Mark: —but moving on.Mr SPEAKER: Order! If the member wants to continue I suggest he just rises and ask the supplementary question.Ron Mark: Will the Minister support an increased defence budget given that the South Pacific is considered a security risk and given proposals to slash Defence Force staffing by 700 and the documented shortcomings of the new NH90s?Mr SPEAKER: In so far as there is ministerial responsibility the Hon Chris Finlayson.Hon CHRISTOPHER FINLAYSON: With respect I do not think there is any ministerial responsibility. The Minister of Defence is an extremely competent person and can be relied on to address those issues. This week I am the Acting Minister of Defence. If he wants to ask me questions in that exalted capacity I am happy to answer them.Ron Mark: I seek leave to do exactly that Mr Speaker.Mr SPEAKER: The member is seeking leave to ask an additional supplementary question?Ron Mark: The stand-in Minister of Defence—a supplementary question.Mr SPEAKER: It is unusual but leave is sought. Is there any objection? There is objection.Electric Vehicles—Uptake9.JULIE ANNE GENTER (Green) to the Minister of Transport: Does he stand by his statement that New Zealand is “the most electric-vehicle-ready country in the world”?Hon SIMON BRIDGES (Minister of Transport): Absolutely and one of the many reasons why is the massive roading investment that the National Government has made ensuring large long roads for them to roar along.Julie Anne Genter: In light of that answer is it because National has done almost nothing to support electric vehicles for the past 7 years that New Zealand has only about 800 while the Netherlands have 45000 and Norway has nearly 70000?Hon SIMON BRIDGES: There have been a number of initiatives in this area. I would remind the member that the number of electric vehicles and plug-in hybrid vehicles in this country has gone up 500 percent albeit from a low base in the last couple of years. If this is a competition about who loves electric vehicles the most I can assure the member that I will be winning because I actually like cars and the roads that they travel on unlike her.Julie Anne Genter: Is he aware that a number of electric vehicle manufacturers are not supplying electric cars to the New Zealand market because they consider there to be insufficient Government policy supporting their uptake and what does he intend to do about it?Hon SIMON BRIDGES: I think that is entirely a mischaracterisation of what the position is. We are a small market. There is a range of reasons why. I agree it would be good to see many more electric vehicles and other low-emission vehicles here. But as the member knows these are things that we are thinking about and will have more to say on in due course.David Seymour: Would the Minister be concerned by reports from places such as Silicon Valley that subsidies paid for by middle-income taxpayers have been used by the super-rich to buy a third car in the form of a Tesla Roadster and does he think that is the sort of policy the New Zealand Opposition should support?Mr SPEAKER: Again either of those two supplementary questions—the Hon Simon Bridges.Hon SIMON BRIDGES: I think there is a real jeopardy in relation to a range of new technologies solar included. You have got to be very careful about not robbing Peter to pay Paul. I think the best policies are ones that remove unnecessary barriers and nudge things along not the big spending and subsidising policies that the Greens favour.Julie Anne Genter: If he is serious about encouraging uptake of electric vehicles here in New Zealand will he support a policy that will actually result in a transition to electric vehicles like my member’s bill that encourages businesses to choose clean transport options for staff by exempting electric vehicles and public transport passes from fringe benefit tax?Hon SIMON BRIDGES: I thank the member for her party political broadcast. Can I make very clear that this is a Government that favours new technologies and does want to remove unnecessary barriers but we will not be supporting the member’s bill.Roading Auckland—Southern Corridor Motorway10.KANWALJIT SINGH BAKSHI (National) to the Minister of Transport: What updates can he provide on the Southern Corridor Motorway improvements project in Auckland?Hon SIMON BRIDGES (Minister of Transport): The $268 million project which is part of the Government’s accelerated Auckland roading programme will make improvements to State Highway 1 between Manukau and Papakura by adding 11 kilometres of extra lanes to improve capacity and traffic flow. It will also include an upgrade of the Takanini interchange. The improvements will tackle congestion and keep traffic flowing along the southern motorway and ensure that the motorway is ready to support the rapid population growth that has been happening—[Interruption]—and is expected in South Auckland over the next 30 years. As the member next to me Steven Joyce points out they will also support many electric vehicles well into the future.Kanwaljit Singh Bakshi: How will the southern corridor motorway improvement project benefit road users in Auckland?Hon SIMON BRIDGES: As the transport economists amongst us may like to know this has a massive benefit-cost ratio of some 6:9 as a project. As a key transport route for Auckland the southern corridor forms a strategic link between the western ring route State Highway 20 and State Highway 16 the airport and the Greater Auckland area. It is going to improve the movement of people and freight locally but also from Northland through Auckland to the Waikato Tauranga as well as further south to the rest of New Zealand. Accelerating improvement to the southern motorway as well as projects at Kirkbride Road on the Northern Motorway and the East West Connections will help ensure that the key routes in the city continue to meet the future transport needs of a growing and dynamic Auckland City.Free-trade Agreements—South Korea11.Hon DAVID PARKER (Labour) to the Minister of Trade: What steps if any has his Government taken to renegotiate the provisions in the South Korean FTA to ensure New Zealand can ban overseas buyers of our homes since he received the select committee report on the South Korean FTA recommending that this be clarified noting as the select committee report did that the Australian FTA with South Korea does allow Australia to ban overseas buyers of Australian homes?Hon TIM GROSER (Minister of Trade): We have taken no steps to renegotiate a trade agreement that we think confers substantial net benefits on New Zealand particularly not to implement a policy of outright banning of sales of homes with which we do not agree.Hon David Parker: I seek leave to table the page from the South Korea - Australia free-trade agreement where Australia is reserved the right—Mr SPEAKER: Order! I will put the leave. Leave is sought to table that particular page of the South Korea - Australia free-trade agreement. Is there any objection? There is none. It can be tabled.Document by leave laid on the Table of the House.Hon David Parker: Why was the right of the Government to ban foreign buyers of New Zealand homes given away in the South Korean free-trade agreement when the Australians have that right under its free-trade agreement with South Korea?Hon TIM GROSER: It was not a question of giving anything away; it was a question of not wishing to implement a policy we do not think is central to New Zealand’s interests. It is a policy stance that has informed a series of free-trade agreements that have commanded wide support over the years from the Labour Party.Hon David Parker: Under the free-trade agreement with South Korea has South Korea reserved for itself the right to adopt a ban on New Zealand people—not being corporates—buying South Korean residential land or homes?Hon TIM GROSER: I would have to seek advice on that.Hon David Parker: I raise a point of order Mr Speaker. This is a question on notice—Mr SPEAKER: Order! No it was not. It was a supplementary question. The question on notice was answered. [Interruption] Order! If the member has further supplementary questions he is entitled to ask them.Hon David Parker: Point of order Mr Speaker.Mr SPEAKER: If it is a matter of whether the Minister should have had an answer more acceptable to the member that is not a point of order; that is creating disorder. Has the member got further supplementary questions?Hon David Parker: Is the Minister so incompetent—Mr SPEAKER: Order! That question is out of order.Hon David Parker: I raise a point of order Mr Speaker. It is not unreasonable for the Opposition to expect the Minister responsible for the free-trade agreement—Mr SPEAKER: Order! The member is coming very close to being asked to leave. He is creating disorder in this House.Hon David Parker: Does the Minister believe that a competent Minister of Trade would know whether the South Koreans have reserved for themselves the right to ban New Zealand “real people” purchasers of residential land?Hon TIM GROSER: I think a competent New Zealand trade Minister would be focusing on New Zealand’s real interests instead of phoney solutions to Labour’s problems with the Auckland housing market.Hon David Parker: I raise a point of order Mr Speaker. I have a number of overdue questions—Mr SPEAKER: Order! I will look into it. If there is a matter of late answers to written questions I will look into the matter as I said I would for another member earlier. I will be annoyed if there has not been some communication between the member and the Minister’s office and I will certainly be equally annoyed if the delay is a matter of a day or so but I will look into the matter.Hon David Parker: To assist—Mr SPEAKER: No I do not need further assistance. I have said I would look into the matter. [Interruption] Order! The member is going very close to being asked to leave the Chamber.Regional Economic Development—Council-controlled Organisations12.SCOTT SIMPSON (National—Coromandel) to the Minister of Local Government: What is the Government doing to ensure councils are best placed to support regional economic development?Hon PAULA BENNETT (Minister of Local Government): This week I announced that I will introduce legislation to give councils greater flexibility to work more together and set up regional structures that better suit economic growth. Councils manage close to $100 billion of fixed assets and over the next decade plan to spend another $41 billion in capital expenditure. Current legislation prevents multiple councils from setting up a shared council-controlled organisation that could for example manage their water or transport assets on a regional level. I want to give them this option so that they can have a coordinated regional approach aimed at maximising economic growth.Scott Simpson: What kinds of benefits could regional council-controlled organisations deliver?Hon PAULA BENNETT: Regional council-controlled organisations have the potential to achieve significant efficiencies through bulk purchasing and shared expertise—something many councils can simply not achieve on their own. Assets will still be owned by ratepayers through the controlling councils but the assets themselves can be managed regionally. This is vital to ensure there is a strategic regional approach to make sure infrastructure supports economic development. Communities have made it clear that they do not think mass amalgamation is the best option. What we want to do is give them other tools where they can manage their assets.Scott Simpson: What reports has the Minister seen about the eagerness of councils to take up the opportunity to work together?Hon PAULA BENNETT: For example I have seen comments today from Whanganui mayor Annette Main who says “Our council believes that the future success of regions like ours depends on how collaborative we are. The new legislation will give us the ability to be more confident about raising new and more innovative ways of working together.” There are also several other regions that have said they are interested—like Waikato and Canterbury—in setting up a regional council-controlled organisation. I hope others take up the opportunity as well.Darroch Ball: I seek leave to table a document prepared by the Parliamentary Library which shows the December 2008 “neets” rate are 10.9 percent which is lower than the 11 percent that Mr Joyce quoted today.Mr SPEAKER: Order! We do not need the qualification. I will put the leave. It is a marginal call but I will put the leave and the House will decide. Leave is sought to table that particular Parliamentary Library information. Is there any objection? There is none. It can be tabled.Document by leave laid on the Table of the House.Ron Mark: Would the Minister be prepared to speak to the Minister of Transport about the adverse effect on economic development within territorial authorities’ regions of the reduction in funding assistance for rural roads which sees Masterton Carterton and South Wairarapa being reduced 1 percent per annum for the next 4 years; and the reduction—Mr SPEAKER: Order! The question is quite long enough.Hon PAULA BENNETT: What I will say—and I am always happy to talk to my colleague about transport issues and particularly in the regions—is that Wellington has recently made it very clear that it is not interested in amalgamation. However it has been talking about some form of transport council-controlled organisation or something else that actually looks at the region as a whole—public transport as well as our roads—and how that could work better from a regional perspective. I certainly welcome that and I hope that those mayors and the leaders of this region continue to show their commitment to that process.Dr David Clark: I seek leave to table a document that shows that every area the Government has had a regional growth programme has lost jobs—Mr SPEAKER: Order! Source of the document?Dr David Clark: It is from the Government’s statistics—from the Ministry of Business Innovation and Employment.Mr SPEAKER: No statistics are easily available for members to get for themselves.Urgent Debates DeclinedSecurity Intelligence Service—Annual Report by Inspector-General of Intelligence and SecurityMr SPEAKER: I have received a letter from James Shaw seeking to debate under Standing Order 389 the findings in the annual report of the Inspector-General of Intelligence and Security.The findings are a particular case of recent occurrence involving ministerial responsibility. The big hurdle to get over in applications for urgent debates is whether the matter has reached the stage where the business of the House ought to be set aside. The test is a high one. There must be an element of urgency or substantive policy change for the matter to take precedence over other business. Although the report indicates there are some areas for improvement in the operation of the SIS I am not persuaded that the setting aside of the business of the House for an urgent debate can be justified today.One factor in deciding whether to allow an urgent debate is that the intelligence and security agencies are subject to very little parliamentary scrutiny. I note that the report states that the inspector-general is undertaking several inquiries into important aspects of the operations of the security and intelligence agencies. The final reports on those inquiries may warrant the attention of the House depending on their findings. The application today is therefore declined.International Finance Agreements Amendment BillSecond ReadingHon PAUL GOLDSMITH (Minister of Commerce and Consumer Affairs) on behalf of theMinister of Finance:I move That the International Finance Agreements Amendment Bill be now read a second time. Following the first reading the bill was examined by the Foreign Affairs Defence and Trade Committee which recommended that it be passed with one amendment. There were no submissions on the bill.The purpose of the bill is to amend the International Finance Agreements Act 1961 in order to enable the Government of New Zealand to become a member of the Asian Infrastructure Investment Bank. The bank is a multilateral investment bank established to address the gap in infrastructure investment across the Asian region. Its purpose is to foster sustainable economic development and to promote regional cooperation and partnership including by working in partnership with other multilateral and bilateral development institutions.New Zealand is joining the Asian Infrastructure Investment Bank as a founding member to contribute to strong and sustained regional growth consolidate New Zealand’s economic and political relationships in Asia and participate in an institution that will further regional economic cooperation and integration. Through our involvement in the negotiations we have seen emerge a genuinely multilateral 21st century institution. We have an opportunity to play our part in this important new institution in our region.The bill gives certain articles of the Asian Infrastructure Investment Bank articles of agreement force of law in New Zealand. The bill provides for extending various privileges and immunities to the bank. It provides an exemption from taxation for the bank and it provides for permanent legislative authority to meet payments due under the agreement. These provisions are consistent with the treatment New Zealand provides to other international financial institutions in the Act.The Government accepts the committee’s recommendation to delete clause 9(1) and (1A) of the bill. Clause 9(1) of the bill as introduced would give article 19(1) of the Asian Infrastructure Investment Bank articles of agreement force of law in New Zealand. Article 19(1) prohibits members of the Asian Infrastructure Investment Bank from imposing restrictions on currencies held or used by the bank or a recipient of the bank for payment. Officials have recognised that it is not necessary to give article 19(1) force of law in New Zealand for the following reasons. The obligations in article 19(1) do not need to have effect domestically and would be inconsistent with New Zealand’s treatment of other international financial institutions in the Act.I want to thank the Foreign Affairs Defence and Trade Committee and officials for their work. I commend this bill to the House.Hon PHIL GOFF (Labour—Mt Roskill): This bill as the Minister has suggested allows New Zealand to join a new international investment bank the Asian Infrastructure Investment Bank and it serves to implement New Zealand’s obligations under the articles of agreement.I want to say that Labour supports this bill because it supports New Zealand’s involvement in the Asian Infrastructure Investment Bank and we think that it is the right decision to do so and for the right reason. I say that because you Mr Deputy Speaker will know that Labour does not support every Government investment decision. In fact if I contrast this decision which is soundly based with the decision to make facilitation payments to a Saudi businessman to enable New Zealand to try to get a free-trade agreement—an agreement that was a disaster and a bribe—I can say that this agreement by contrast is a paragon of virtue.Labour believes that the Asian Infrastructure Investment Bank is a positive move and that the investment that we will make in it will be soundly based. I have to say that the issue was initially controversial. The United States made no secret of its opposition to this bank being established. It was opposed to the idea and directly and indirectly sought to influence other countries not to participate. The grounds for the United States doing that were first of all that it said the International Monetary Fund the World Bank and the Asian Development Bank adequately met the needs of investment in Asia. That is patently incorrect. In fact I can quote the former Secretary to the Treasury Alan Bollard who is now in the APEC secretariat. He made the point quite clearly that there is absolutely huge demand for investment in infrastructure in Asia and that it was not being met by the established Bretton Woods institutions.Secondly the United States seemed to argue that support for the bank would allow China to expand its influence. It may do but it also has to be seen as incredibly naïve to think that the world’s second-largest economy and a financial superpower in its own right does not have the ability and the right to expand its influence. In fact the United States to some degree has brought this on itself because the US Congress stood in the way of China exercising influence commensurate with its size in the IMF and the World Bank. That is not a prejudiced comment from me; that is something that our Minister of Trade Tim Groser acknowledged some months ago. Will China expand its influence? Well China has 25 to 30 percent of the voting rights in this bank but it is only one of 50 countries that currently will be a member of the bank. It sits alongside other large countries both developed and developing like Britain Germany France Italy the Republic of Korea Russia and India.We I think made the right decision in becoming involved early in the negotiation of how this bank would be set up. We were the 24th country to join. That does not sound like we rushed into it but we were in fact the world’s first developed country to join those negotiations and as a result we were able to influence the outcome of the negotiations. I want to pay a particular tribute here to John Whitehead known in this House as a former Secretary to the Treasury a person I have known for the best part of 40 years. He is a person of incredible skill experience and integrity and I know from the feedback I have got that John Whitehead did an extraordinarily good job in making sure that this institution follows international best practice for financial institutions. We should be proud of the contribution that he has made and the bank is better for that.As the Minister said the select committee was not exactly swamped with submissions on this bill. In fact we received no submissions. Maybe there is a subtle message to the Government there—if it wants to cut down on submissions it should use the words “international financial agreement” in the title of a bill and the average layperson will say: “This is altogether too complex and we shouldn’t go near it.” It is not hugely complex but it is very important. And it is important to know what this bank will do. It is a multilateral investment bank and what it is designed to do is to address the gap in infrastructure investment that exists in the Asian region. It seeks to foster sustainable economic development and to work with other multinational institutions to promote regional cooperation and partnership. Although the United States said that it was not really necessary it was interesting that a former Minister of Trade whom I got to know and is now head of the International Monetary Fund Christine Lagarde has welcomed the establishment of this bank.Why should New Zealand be supporting it? Well I think there is scarcely a member in this House who would not acknowledge that our future as a country is tied up very closely with the future of the Asia-Pacific region. It is our geographic location it is where most of our largest trading partners are based and it is a region that is important to us economically and politically and we need to be seen to be involved in and making a constructive contribution to that region. The contribution that New Zealand is making is relatively small. We are putting forward capital of NZ$145 million over 5 years and we have callable capital of something like US$461 million. I hasten to add that I think in our entire history of putting up callable capital that capital has never been called up and there has never been a financial collapse of an international institution that we have put capital towards. So I do not think there is a huge amount of risk in that regard.What are the drivers of our involvement in the bank? They are first of all economic. As I said our future is linked with the Asia region and Asian growth is constrained by limited infrastructure investment. If Asia develops its infrastructure and grows economically that is of direct benefit to us because that is the predominant region into which we are trading.Secondly it is important because of our connectivity to the market. New Zealand is a small country and its influence is commensurately small you would think but we can develop that influence by the relationships that we develop. The free-trade agreement with China is a classic example. The Chinese repeatedly in those negotiations quoted back to us New Zealand’s “four firsts” because we had developed the relationship with China and they valued the effort that we made. And as a result of that New Zealand became the first developed country to get a free-trade agreement with China 10 years ahead of our mates across the Tasman. Well just as relationship-building was important in that the relationship-building that is implicit in our involvement and our constructive contribution to the Asian Infrastructure Investment Bank is equally important.Thirdly just to develop a point I made a moment ago it was important to commit because we could influence in the negotiations the way in which the bank was set up. We made sure that the bank’s membership is broad and open; we made sure that it followed sound governance and appointment processes; we ensured working with others that environmental and social issues were to be taken into account by decisions made by the investment bank; and we ensured working again with others that it will operate according to sustainable economic and financial principles. As a result this is an institution that will have proper oversight for investment decisions and for development outcomes. Both of those things are important in a decision to be part of it and it will follow international best practice.This is a soundly based decision. This bill is appropriate in committing us to membership of that bank and allowing us to meet the requirements for that membership to happen as soon as the bank comes into existence.MARK MITCHELL (National—Rodney): I am very pleased to take a call on this the International Finance Agreements Amendment Bill. As the previous speaker Phil Goff highlighted and Minister Goldsmith spoke about it is just a change really to the International Finance Agreements Act to allow us to become a member of the Asian Infrastructure Investment Bank.I just want to acknowledge the Foreign Affairs Defence and Trade Committee and I want to acknowledge Phil Goff and David Shearer. As Mr Goff just stated they were early supporters of this investment into what is going to be critically important as a bank that is going to continue to invest in infrastructure that is going to have a tangible gain and benefit for New Zealand. I am not sure of what the Green Party’s position is on this bill but I am sure if Kennedy Graham is taking the call we will hear its position on it shortly.Asia is driving global growth and it is full of opportunities for New Zealand—six of our top 10 export markets are now in Asia and 11 of the top 20 are in Asia. Some of the free-trade agreements that we currently have are with China Thailand Singapore Malaysia Hong Kong Taiwan and of course our recently signed agreement is with Korea. The New Zealand contribution in US dollars is going to be about $92 million and that has been determined relative to the share of countries in relation to our GDP. Some of the benefits that we have seen from the Asian Infrastructure Investment Bank—I think that Mr Goff made a very good point. I just want to highlight the fact that we were the first Western nation to actually get involved with talks and negotiations around the formation of this bank and that is actually quite significant. What it will allow us to do is it will allow us to retain a fair bit of influence in terms of the direction that the bank takes and where the focus will be on the investment in infrastructure in the coming years.I was recently up in the Pacific Islands for a forum up there and one of the real big driving issues that was raised there is the investment into information and communications technology and the need for a submarine cable. We are becoming huge voracious users of data and information and communications technology is important for any country that wants to engage in global business. This is going to be one of the focuses of the Asian Infrastructure Investment Bank: upgrades on things like our information and communications technology infrastructure.The bank is also going to look at improved infrastructure in logistics hubs which of course will have a very positive spin-off for New Zealand products in terms of being transported more easily and cheaply internationally which is significant for us as a trading nation down at the bottom of the world. Having an efficient supply chain and being able to upgrade the infrastructure that is supporting our logistics operations are going to have a positive and tangible benefit for us.Improved infrastructure in airports will help New Zealanders to trade globally using Asian airports and hubs. I guess this is just an extension of the overall supply chain and logistics networks that we have to be able to access to get our products and services and goods to market. The sharing of knowledge between the investment banks such as the IMF the World Bank etc. allows for improved processes and activities. So being a member of the Asian Infrastructure Investment Bank is going to allow us to form even closer relationships and lines of communication in terms of the holistic view of growing our markets globally.I would just like to highlight the fact that and I often speak about this we are great little nation down at the bottom of the world. We are obviously very proud of the way our All Blacks performed in London. Not only are they the world’s best sporting team but they were also fantastic ambassadors for us as a country. But we are a small nation down at the bottom of the world and actually it is really important for us to continue to engage and be part of initiatives like the Asian Infrastructure Investment Bank in terms of continuing to grow our own exports promote our own services and our own products and secure a future for New Zealand.I am very happy to support the International Finance Agreements Amendment Bill. Thank you.GRANT ROBERTSON (Labour—Wellington Central): It gives me pleasure to join the outbreak of violent agreement across the House on this bill. I certainly do support New Zealand’s involvement in the Asian Infrastructure Investment Bank. The Foreign Affairs Defence and Trade Committee obviously had the onerous task of wading its way through the public’s voluminous submissions on this matter and has managed to bring it back to the House in one piece and it is to be thanked for that.As other speakers have noted what the Asian Infrastructure Investment Bank essentially offers for New Zealand is the opportunity to be at the table when big infrastructure decisions are being made in our region—and this is our region. Certainly in the early days of the process of establishing this bank there was and has been criticism of the World Bank. Others might say that the World Bank and others who lend into the IMF and others who lend into the region should be undertaking this work and ask why you would need an additional investment bank in the region. Certainly when the bank was first being suggested there was a lot of talk from some very large friends of ours involved in the World Bank that perhaps we did not need this kind of investment bank. But I think having a bank based out of Asia that is specifically focused on the core infrastructure needs—and Mr Mitchell mentioned one of those in his speech—in the region no doubt to my mind will be best served by having a bank that is based in the region and which has as its contributors the leading economies of that region.That was the first hurdle I think to get past in terms of whether or not this was justified. I note in the select committee’s earlier report that it did on the national interest analysis that it asked about the attitude of the World Bank to this and was told that the World Bank was—I think the phrase used was—“pleased”. I find that a little difficult to believe to be honest with you. I do not think it was probably pleased but I think it probably has accepted that this is now going to happen and that New Zealand should continue to be both a player in the World Bank and the Asian Infrastructure Investment Bank.So having got over that first hurdle there are really three areas of value I think to New Zealand here. The first is the one that has been covered by all of the speakers which is the importance economically of the Asian region to New Zealand. This is unquestioned. This is not just about China where we have been able to make huge strides under the free-trade agreement negotiated by my colleague Mr Goff but also in the emerging economies in that region. I am thinking here particularly about countries like Viet Nam where there is a huge opportunity for New Zealand to be involved. Mr Mitchell I understand is off to observe an election in Myanmar very shortly—there is a country with infrastructure deficits caused by what has happened in the governing of that country in recent years and where a bank like this could have a big say but where there are huge trading opportunities for New Zealand as democracy grows in Myanmar.Chris Bishop: That’s right. Viet Nam’s part of the Trans-Pacific Partnership.GRANT ROBERTSON: Mr Bishop is a big fan of democracy I know that. And so there is the opportunity for New Zealand to be there to be supporting the growth of these countries that will become large economic players in the Asian region to sit alongside China and those with which we already have very good relationships.The second factor is around connectivity to those markets. How do we ensure that we know what is happening that we are involved in the decision making around the regional structures? And there are a large number of those Asian regional structures that New Zealand is either an observer at or has participated in. This adds another level to that. The bank will be making some pretty significant decisions about how economic growth works in the Asian region and New Zealand is able to be at the table albeit with a modest contribution but a contribution that is relative to our GDP and the entire membership of the bank.The third reason which is related to that is that question about the ability to influence. This should not be understated in terms of New Zealand’s involvement in the bank: our willingness to be there right at the beginning. So we have had the “four firsts” but this was important for New Zealand to be there right at the beginning and be a part of how the bank was established.I note that when we look at some of the concerns and issues that New Zealand raised early on in the process it was New Zealand officials and negotiators who were able during those discussions to talk about what kind of governance mechanisms should be used. In fact New Zealand pushed for open transparent and merit-based appointments to the board of the bank. That phrase “open transparent and merit-based appointments to organisations” is one the Government might like to consider in a wider context with some of its other boards that it appoints people to but the fact that New Zealand was pushing for this and succeeded in getting that process shows how useful it is for us to be at the table at an early stage.Related to that Mr Goff mentioned the inclusion of the safeguards around environment social and procurement matters for the bank. This is actually very significant and again builds on something that New Zealand has pioneered in trade negotiations which is that alongside those negotiations we actually have meaningful environmental and labour standards and standards that support good governance. These were not always part of trade agreements and they were forced through particularly under the last Labour Government to say that we are not going to sit down in these trade negotiations and pretend that the economic activity takes place somehow or other independently of environmental and social considerations.So the draft environmental and social framework for the Asian Infrastructure Investment Bank is actually a comprehensive document in terms of the topics that it covers. Under the environmental areas that the bank has to take into account in terms of infrastructure we have got biodiversity critical habitats natural habitats protected areas climate change—a precautionary approach—and pollution prevention. These are actually very important ideas about what is important in future investments and they are now a core part of what the bank has to take into consideration in those investments. That is in large part because New Zealand has been part of pushing for those. Similarly in social coverage there are gender-specific impacts of investments and cultural impacts of investments. In terms of working conditions: health and safety child labour forced labour and minimum labour standards.So these are now part of what the bank has to consider when it is making its infrastructure investments. They are there in part because New Zealand was successful in pushing them. And just to give a further example New Zealand was successful in having the word “sustainable” added before “economic development”. That would not have happened if we were not at the table and I acknowledge that this has happened under this Government’s watch. I think it builds on the kind of approach that we have tried to take with our broader trade and economic investment ideas.I do not have an awful lot more to add than that other than to endorse the fact that the bill is a good piece of legislation. Perhaps in the Committee stage of the bill when we come to it—because we need to find something to talk about when we get to that—we can discuss the Foreign Affairs Defence and Trade Committee’s decision to delete clause 9(1) of the bill which was the decision that the committee made to get rid of the part that said that the articles of agreement for the bank would have force of law in New Zealand. I cannot see why they would be needed and I suspect that is the point—they do not actually apply to New Zealand and therefore there is no need to give them force of law. So it is probably a sensible decision all round. It is interesting to note that a decision was taken not to give them force of law in New Zealand given other agreements we might discuss in this House in the coming weeks. So with that I commend the bill to the House.Dr SHANE RETI (National—Whangarei): It is a pleasure to speak to this bill. This bill effectively amends the legislation and lets us become a member of the Asian Infrastructure Investment Bank. More specifically it amends the International Finance Agreements Act 1961.It has already been commented to us how important Asia is. A number of figures—of course Asia buys 43 percent of our export merchandise. It is significant; it is important. There is certainly need for development of infrastructure in Asia and New Zealand can help with that. I think that also talks to some of the advantages some of which we have heard about being a part of this bank. New Zealand businesses will be able to compete for infrastructure contracts under the open procurement agreement. Being a founding member as we have heard has let us play a role at the development table initially. This let us assist with direction and transparency and we have been able to bring some of the best practices that New Zealand has—which we are good at—to that table. We have also been told that our relationships with our Asian neighbours have been strengthened through our engagement. We remain a steady hand and open for business.This is the second reading of this bill and the Foreign Affairs Defence and Trade Committee—as has been commented—received no submissions on this bill. To address the question that the member Grant Robertson raised a moment ago what the committee did agree to was to delete clause 9(1) from this bill. What that clause would have done was enable article 19(1) of the International Finance Agreements Act which talks to prohibiting currency restrictions for members and recipients. The case was made to us by officials and we agreed that we did not need that clause which answers the member Grant Robertson’s question because it is already covered by domestic policy and it is inconsistent with our existing international finance agreements.Really this is a piece of legislation that lets us be a part of the Asian Infrastructure Investment Bank. We know that it is good for New Zealand. We know that the opportunities for our exporters will increase. We know that the contracts will be let out with best practice and that we will be able to compete for those contracts. We have been able to be part of the founding group and therefore influence it and have a say. I think that all of those are good things and I commend this bill to the House.JULIE ANNE GENTER (Green): I rise to speak on the International Finance Agreements Amendment Bill in its second reading. To answer the question posed by my colleague Mark Mitchell earlier in this debate the Green Party is supporting this bill. The Green Party does support banks and infrastructure banks particularly if they are oriented towards solving our urgent need to invest in infrastructure that will respond to both climate change and inequality—the two biggest challenges our world is facing.In fact before the last election the Green Party had a policy of having a Green Investment Bank here in New Zealand. That was going to be a commercially run bank that would facilitate investment in clean technology and energy here in New Zealand because we feel there is a bit of a gap in the market here in New Zealand. The cost of setting up that bank would have actually been slightly less than the costs that we are donating to the Asian Infrastructure Investment Bank—about $120 million over a period of time—and it would have been run on commercial grounds. We still think that is a good policy and we would love it if the Government picked that policy up.When it comes to the Asian Infrastructure Investment Bank we can see why New Zealand would want to be involved in such an endeavour. It is about being a good neighbour in Asia. It is about ensuring that we are at the table and hopefully influencing decisions in a way that is going to result in the type of infrastructure being built being infrastructure that is going to benefit the region in the long term not just benefit it in the short term and not just benefit the people procuring the infrastructure or building the infrastructure.I think it is really important that we note at this point our concern. I think there is every indication that the Asian Infrastructure Investment Bank is going to be run on principles that take into account the reality of climate change and that have a focus on environmental sustainability as well as poverty reduction because it is impossible to respond to one of those challenges without responding to the other. As my colleague Marama Davidson said in her maiden statement to the House yesterday it is impossible to address either climate change or inequality without addressing both.There was recently a report from the Global Commission on the Economy and Climate project the New Climate Economy. It is putting out a lot of really helpful reports. These are big global players including Deutsche Bank AG and they say in their report that it is urgent now that we get collaboration not only between Governments but between communities between businesses and between investors on addressing the risk of catastrophic climate change. They say that it is urgent that all players public sector and private sector are working together to ensure that we seize the opportunity presented by climate change to ensure that the infrastructure we invest in now is actively reducing our carbon pollution.Unfortunately for the past 50 or 60 years much of our investment in infrastructure has actually aggravated climate change by increasing pollution and increasing carbon emissions and it has not actually done as much as we would have liked to reduce inequality. Although we have seen global incomes rise in some developing countries that growth has not been equally shared by all people in those communities and we have seen a real concentration of capital in the hands of a few which is driving ongoing challenges—social challenges environmental challenges and actually economic challenges. Arguably the reason the global economy has failed to bounce back from the global financial crisis is that there is such growth in inequality and such concentration of capital in the hands of very very few people. So it is essential that when we assess the types of infrastructure projects that we are investing in in Asia through the Asian Infrastructure Investment Bank or here in New Zealand we assess that infrastructure in terms of its ability to reduce pollution and to reduce inequality.Unfortunately at the moment the current Government has an infrastructure programme that is not really going to do anything to reduce pollution and arguably is not going to do anything to improve economic efficiency which is a real shame because there is that opportunity. The Green Party would like nothing more than to see the National Government seize this economic opportunity because there is not a trade-off. It is not the case that we have to sacrifice our pristine natural environment and the future stability of our climate in order to get richer and have economic growth. Actually there are many opportunities where the economy will function better by doing the things that actually restrict pollution and reduce pollution.A perfect example is in the transport infrastructure being invested in in this country right now. There is a real priority on a few big projects that will do nothing to reduce congestion even though that is their purported purpose. They will do nothing to reduce the cost of moving goods and people around the country and they will do nothing to reduce carbon pollution or inequality. So here we have the opportunity and I as a former transportation planner and urban planner am very passionate about the opportunities that exist to create infrastructure that is much smarter that costs less money and that enables people and households to live in great places to live close to where they work and to do so in a way that reduces both the personal cost to them and also the environmental impact. So we have got these win-wins.I can see in the language around the Asian Infrastructure Investment Bank that that idea which is really gathering a whole lot of steam globally is included in the principles upon which the bank was set up and that is why the Green Party is happy to support this bill. But we would like to see more of that type of thinking here in New Zealand and we have the opportunity to do so. Particularly coming up to the climate talks at the end of this year there is a real momentum gathering not just amongst Governments—of course not with our Government but other Governments—but also in the business community. I note today that Business New Zealand has announced that it is going carbon neutral because it sees the risks and opportunities presented by the new climate economy. I put the question to our Government the National Government: when is it going to take the challenges and opportunities of climate change and inequality seriously and start applying that logic to policies here in this country? We all stand to benefit from smarter policy that results in a cleaner environment and a fairer society.FLETCHER TABUTEAU (NZ First): It has been wonderful to listen to the naivety almost of some of the contributions of the speakers this afternoon. They speak as if this were the only way to build relationships and to get into the good books of China. It is just wonderfully one-eyed and focused on—I do not know—something that suits them. It is a very focused narrative.I acknowledge that this is a very simple piece of legislation which changes a few lines in the International Finance Agreements Act 1961 in order to facilitate New Zealand’s participation in this Asian Infrastructure Investment Bank but New Zealand First continues to oppose this legislation. There are two main reasons for our opposition. They have not changed since the first reading mainly because the Government has not addressed the first issue that we raised and it is in no position to change it; it is too late. The second reason is actually based on the realities of international infrastructure and investment banks around the world and especially the realities of investing in China and the broader region that this bank presumes to represent.On the first point I say to those on the opposite side of this House that the New Zealand Prime Minister needs to look New Zealanders in the eye along with some of those National bankbenchers. They need to look their constituents in the eye and talk to them about their broken promises and explain how selling off New Zealand assets and essentially giving our money to this investment bank could possibly be any better than spending it in New Zealand—rather than giving it away. The Prime Minister and that National Party broke a promise to every New Zealander. New Zealanders opposed the sale of our assets. All who were opposed to the sales including New Zealand First were told that the resulting funds would be spent on hospitals schools and infrastructure in New Zealand.We were all told it would be spent on paying off this Government’s debt which continues to balloon out of control. We were told it would be spent on rebuilding Christchurch. That was the promise made to all New Zealanders and it comforted many. It comforted many who thought it was our only choice because that was the line given to them by this National Government.With the claimed mandate that it clearly did not have and does not have now the Government sold off large chunks of New Zealand assets. Despite promises to the contrary in fact as it turns out it sold them mainly to foreign investors. There will be hospitals there will be schools and there will be roads built but not in New Zealand. That is the reality of this investment. The Government has agreed to put US$92 million upfront into this investment bank. It has agreed to commit more than half a billion dollars to be set aside to be what is termed “on call” should the investment bank be so desirous as to call upon it. Actually as the New Zealand dollar devalues and because these discussions were had in United States dollars our commitment grows and grows daily as our dollar falls. We are talking about a NZ$145 million commitment and $560 million for the “on call” commitment totalling well over $650 million of commitment.I do not think that anyone could dispute that this is a vast sum of money which could have been invested in New Zealand infrastructure—this is our main argument—into cell towers broadband infrastructure roads schools hospitals or rail all of which are sorely needed now. We could have set up a regional growth fund for example and used our regions and that money to rejuvenate our New Zealand economy through our regions. What a dream what an aspiration—but no this money goes overseas.Firstly New Zealand First insists that infrastructure development just like charity actually should begin at home especially as this Government’s debt spirals out of control and unemployment rises and business confidence falls. If New Zealanders were not already suffering if our regions were not already missing out if our exports were not actually declining if real unemployment in New Zealand was not actually on the increase and if money used to buy into this club was not in fact sourced from a broken promise given by the Prime Minister New Zealand First would actually welcome a discussion on this Chinese initiative.Now to my second point around the opposition to this legislation. I will quote some experts on infrastructure investment from around the world. Kent Kedl of the company Control Risks has stated of investment into China that “you don’t become successful in China as a purely private entity you need a powerful connection.” He was speaking to words from another investment business adviser who noted: “There are no genuinely private companies in China.” He is of course quite correct. And to quote The Economist “The state and the party are omnipresent and their role is enshrined in law.” Let us be mindful that Japan and the United States have refused to participate in this bank citing issues with the bank’s governance among many other issues. “Peter Williamson of Cambridge University’s Judge Business School argues that the [Chinese] government will always meddle with firms in industries it sees as strategic even if they are multinationals.”What consideration has been given to these issues? This problem is not unique to China and those members of this House who have worked in this space will appreciate that developing countries with weak institutions and poor governance are often far bigger obstacles to growth than actual lack of funds. I acknowledge that China is searching desperately for investment dollars as it switches its economy from infrastructure development to a consumerist one. New Zealand First would point out however that this infrastructure bank is not the whole answer and will provide little or no benefit to New Zealand. We must consider the realities that history has shown us again and again. A project presented to this type of investment bank will often look good on paper; practical implementation on the other hand is often a frustrating and sobering experience. Costs provided to investment bank projects historically far exceed initial estimates and planners bidding for funds often woefully underestimate the skills and funds needed to ensure the maintenance and repairs of these big infrastructure problems.It has been interesting to note the contributions from members today as well. They have been speaking as if our participation in the Asian Infrastructure Investment Bank has been a matter for this Parliament or the Foreign Affairs Defence and Trade Committee. Actually there was no discussion of our participation in the details as such in the select committee. I will remind this House that actually this Parliament did not make any decision to participate. The details of the Government’s participation in this investment fund came to the select committee after the fact. All decisions had already been made in relation to our participation in the infrastructure bank itself. Our consideration and discussion is after the fact. It had already been signed.This Government has bitten off more than it can chew. It has committed far too much of New Zealanders’ money that was supposed to be used for New Zealanders. The advantage of being an early adopter has perhaps compromised our negotiation power in the Trans-Pacific Partnership as we undermined our relationship with the US. We will not have a say on how the money will be invested and to the Minister of Finance I say again: we will grow strong with Asia but the benefits arising from this bank alone are highly questionable. Without doubt New Zealanders would have preferred to see over $650 million invested directly into the New Zealand economy. Perhaps then we as an economy could have better contributed to our immediate region’s growth. The Minister’s logic is backward at the least and flawed in reality. Thank you.JAMI-LEE ROSS (National—Botany): It will come as no surprise to members in this House that the New Zealand First Party stands as the only party in this Parliament opposed to greater infrastructure development in Asia. It stands opposed to New Zealand expanding its ties with other countries in the world and it opposes other countries in the world trading with New Zealand. And that speech where Mr Tabuteau used the word “naïve” did not apply to the Government or the Labour Party or the Green Party; it applied to the New Zealand First Party.Asia is a huge part of the future opportunity for New Zealand. Six of our top 10 export markets are now in Asia and 11 of the top 20 are in Asia as well. Asia accounts for a huge amount of our future opportunity and our trading opportunities as a nation. New Zealand’s participation in the Asian Infrastructure Investment Bank will mean that we are at the table helping to make decisions about how infrastructure and development and economic opportunities in Asia are developed into the future. As Asia continues to develop we in turn will see greater economic prosperity through greater trade with Asia and that is good for New Zealanders.When the New Zealand First Party members stand in this House and oppose trade agreements they are opposing future opportunities for exporters in this country and future investment into this country. When the New Zealand First Party members stand in this House and oppose agreements like this they are opposing future opportunities for New Zealanders to see Asian countries trading with New Zealand and helping to bring more money to this country. They might like to stand in this House and say for example that Koreans should go back to Korea but we in this Parliament and on this side of the House actually welcome greater economic and international opportunities for New Zealanders because that benefits the very people that we are here to represent.I want to correct Mr Tabuteau when he talks about supposedly broken promises around investment because he is absolutely wrong about the Future Investment Fund. When he says we are not investing in infrastructure in New Zealand and we are diverting money elsewhere he is wrong. In Budget 2014 the Future Investment Fund saw $200 million going into health $172 million going into education and $75 million going into Canterbury housing contingency amongst other things. In Budget 2015 we saw $244 million going into education $210 million into ultra-fast broadband $210 million into KiwiRail—the list goes on.Mr Tabuteau and New Zealand First are wrong again about international opportunities for New Zealanders. They are wrong again about the Future Investment Fund. And it is not the Government that is naïve; it is Mr Tabuteau and New Zealand First. They should be supporting this—like other parties in this House—because it is good for New Zealanders it is good for our economic prosperity and it is good for everyday Kiwis who want to see greater economic opportunities through trade and through investment in New Zealand.Mr DEPUTY SPEAKER: I call Kennedy Graham—a 5-minute speech on behalf of the Green Party.Dr KENNEDY GRAHAM (Green): The Green Party tends to agree in general terms with what the previous speaker Jami-Lee Ross has just said. There is on balance a net reason to join the Asian Infrastructure Investment Bank. The reasons that have been identified both by our Labour colleagues and National are essentially twofold: one is that it is in our interest to get engaged with Asia’s future and secondly if that is the case then it makes sense for New Zealand to get involved early on and have some influence in the creation and early development of the bank. So those are the reasons that the Green Party agrees with and is prepared to support the International Finance Agreements Amendment Bill accordingly.That said there are caveats that we need to have regard to. Jami-Lee Ross and I think others identified the primary objective of the bank as increasing growth in Asia and said that is in New Zealand’s interests. Yes and no. It depends on what we mean by growth in Asia because we tend—and it is there is the articles of agreement of the bank—to throw these words around with fair gay abandon without a really deep understanding of what these words mean. The essential purpose of the bank under article 1 is to “foster sustainable economic development create wealth and improve infrastructure connectivity in Asia”—three subsidiary purposes in the one. We can tick each of those but the critical phrase is “sustainable economic development”. If that economic development is not sustainable it is not in Asia’s interest it is not in New Zealand’s interest and it is not in the world’s interests. And yet we tack on and we throw in that adjective “sustainable” as if it is the veil for anything that we wish to do.The enthusiasm with which some of our colleagues here in this House today have struck up on Asian growth and Asian economic development gives us pause here in the Green Party. We support it but only on the very strict understanding that that growth is sustainable economic development. The faith in the ability of the bank or even of New Zealand to encourage the bank to achieve that goal is not increased when you look at the preamble in the way it was drafted. The first preambular paragraph talks about “to sustain growth”. It does not say “sustainable economic development”; it says “sustain growth”. Sustained growth is not necessarily and may well not be sustainable economic development. Yet we identify it in the first preambular. We think in the first preambular that sustained growth will help us contribute to “regional resilience against potential financial crises and other external shocks in the context of globalisation.” The biggest external shock for Asia New Zealand and the world is going to be the hit back from the ecological deficit and the global ecological crisis if we do not engage in sustainable growth.We are prepared New Zealand to contribute US$92.3 million to this—US$92.3 million. What are we prepared to do for the UN Green Climate Fund? That is $2.6 million—$92 million versus $2.6 million. How much are we contributing to the Green Climate Fund per capita? Sixty cents. How much is Luxembourg contributing? It is contributing $6.70 Norway—this is per capita—$50.60 Denmark $12.80 and Australia $7.90 per capita. New Zealand is contributing 60 cents—US$2.6 million. The Green Party’s enthusiasm for membership of this bank would increase proportionally to the way in which we divided our contribution of $92 million to the bank and to the Green Climate Fund. If it was $46 million each then we would have sustainable growth. Thank you.Mr DEPUTY SPEAKER: I call David Seymour—a 5-minute call for the ACT Party.DAVID SEYMOUR (Leader—ACT): I rise on behalf of the ACT Party in support of this bill. I think it is a very positive initiative for New Zealand to be involved in promoting investment in core public good infrastructure within countries that will make up an increasing proportion of our trading partnerships as they have over the last period of time.I might take a moment to reflect on some of the earlier contributions and the inherent contradictions within them. It was enormously surprising to me that the New Zealand First contribution we have had today was in opposition to New Zealanders investing in overseas infrastructure projects. The reason that this surprised me is that every time any foreigner invests within New Zealand that party says that the profits are all going overseas and New Zealand is all the poorer. If one was to follow the logic of that argument one would have to think that we should be promoting as much investment by the New Zealand Government in infrastructure projects overseas as possible in order that New Zealanders might be able to benefit from skimming back so many profits from overseas as we are told happens when one country invests in another. But of course that sort of contradiction is not the kind of contradiction that the New Zealand First Party generally has the intellectual horsepower to address so we will go no further.I certainly hope that when this legislation is enacted and when this bank begins investment it will focus on high-quality investment. I think a number of contributors have raised their concerns about the quality of the investment and what sorts of projects will be funded with the kind of capital that is being provided. I think it is extremely important for the growth of any regional economy that Government funding—and this is Government funding; this is transnational Government funding—is put towards goods and in some cases services that are not readily available on the private market. Much of the frustration that Aucklanders presently have with the Auckland Council for instance relates to the fact that the council has become confused about whether it is providing public goods that are not readily available on private markets or whether it is providing a wider basket of goods that are competing with the private sector.I would certainly hope that through this treaty we will find that New Zealand capital to the extent that it goes overseas to be used for investment overseas is used in order to provide public goods. It is a pity that the economics professor is not here but we should put on record that public goods are those that have the quality that—David Bennett: He’s never here mate.DAVID SEYMOUR: —he is absent in many senses—The ASSISTANT SPEAKER (Lindsay Tisch): No. Order! You cannot mention the absence of a member even by inference.DAVID SEYMOUR: My apologies Mr Assistant Speaker.David Bennett: How about his presence? Mention his presence?DAVID SEYMOUR: His presence I could mention perhaps but not in this instance.Public goods are those that are non-rivalrous and that are non-excludable meaning that everybody benefits from the presence of the good and that nobody can be explicitly excluded from its benefits. That is when we have cause for taxpayers to have their capital taken to provide a good that will benefit all. It is also useful to spend public money on assets that have a network effect—that is that they have constantly increasing returns to scale and that the market place is most efficient with only one provider and therefore it makes sense again for Governments to be involved. But it would be a great shame if we were to see New Zealand capital going offshore to compete with the private sector in those countries. I am assured by the honourable Minister that that is not the case and that this capital will be going to build infrastructure overseas to enhance the economies and the productivity of our trading partners and therefore increase the effective market size faced by New Zealanders. On balance that sounds like a very noble deployment of capital and I wholeheartedly support this bill on behalf of the ACT Party. Thank you.IAN McKELVIE (National—Rangitīkei): This is a somewhat unusual type of bill for me to be speaking on but it is a bit of a pleasure—Hon David Cunliffe: It’s not about cows.IAN McKELVIE: I will get to that. It is a pleasure to speak on the International Finance Agreements Amendment Bill. I always find it quite interesting listening to the member for Epsom David Seymour. He has a slightly different view I guess of benefit and market than my view but none the less that is what happens in Epsom.I want to very briefly talk about this. I spent last week in Asia interestingly. I think it is hugely important for New Zealand that we maintain our reputation. We have a great reputation in that part of the world and it is increasing all the time. So I think for us to be playing a role in a place that is very significant for us as a market is really important. I am very pleased to support the bill because I think it gives us a further opportunity to reinforce our presence in Asia.On the matter that Kennedy Graham raised about the type of development that is taking place in Asia I think we can be pretty sure that the modern infrastructure build in that part of the world is certainly more sustainable than some of the early infrastructure build that took place in that part of the world. So I think that making a contribution to this is also going to assist the development to become much more sustainable in the future which I think is really important.From New Zealand’s perspective to be able to put money into a fund that is going to certainly help countries in Asia that we will definitely have trading relationships with in the future and at a much greater rate than we do now is certainly very good use of New Zealand money. I think that to suggest that New Zealand money should not be invested in Asia and that it is better used for New Zealand—this money is certainly being used for the benefit of New Zealanders and I think it is a very appropriate use of it. So I have got no problems supporting this bill. I think the whole idea behind it is very sensible for New Zealand. I have got great pleasure in supporting the bill. Thank you.Hon DAVID CUNLIFFE (Labour—New Lynn): I rise to take a call in this second reading to express the Labour Party’s support for the bill. It is part of our ongoing commitment to an open and an internationalist engagement with the world and to build good strong multilateral institutions that allow for the economic and social and governance development of our region.Having said that there has been an enormous amount of naivety expressed around the House in this debate so far and it behoves us I think to lift the bonnet on this and just look underneath at what the engine really is. Can I just pick up a couple of the arguments that have been used by the last two speakers from the National Party. The last speaker but one used arguments of such subtlety and meaning as: “Asia’s got six out of our top 10 markets; therefore we must support this development bank.”Well there are one or two steps between acknowledging that there are a lot of countries in Asia with whom we trade and that a particular investment in a particular bank is in New Zealand’s national interest. What for example is the role of that bank? Exactly what type of infrastructure does it seek to promote? What role would there be for New Zealand in the governance of that bank and what economic or geopolitical benefits would flow to New Zealand from membership as opposed to not being in it? Those are valid questions. The point is that they are somewhat deeper than just saying “Well six out of our top 10 markets are in Asia.” as if that is a lay down misère. It is not and I think the House deserves a better quality of debate. Likewise with Mr McKelvie’s saying: “I have no problem putting money in Asia”—he has got plenty—“rather than New Zealand.” Well yes that is good. It is internationalist it is outward-looking—you know tick that box—but that is not a sufficient answer either. What is the role of this bank? Why is New Zealand investing in it? It is a substantial amount of money: $US92 million about $NZ140 million on today’s exchange rate. Goodness me! That is more than four times the amount the Government is spending on the flag referendum.That is a lot of money—it is a lot of money—and it is coming out of that thing called the Future Investment Fund. Remember that when the Government sold down New Zealand’s sovereign State assets it created a fund which it euphemistically called the Future Investment Fund which was to be spent on things like schools and hospitals and Chinese or Asian investment banks—ah no. That was never in the press release. This is the most abused overused fund in the history of public relations propaganda. It is a ridiculous overstatement.Jami-Lee Ross: Remember when he lost an election on it?Hon DAVID CUNLIFFE: There is “Tony Soprano - lite”—“Tony Soprano - lite” has picked up out of his slumber and he could not resist the opportunity to have a jab. He just did not say anything useful.Let us see what the international commentators are saying about the Asian Infrastructure Investment Bank before we try to confirm that joining it is in New Zealand’s national interest. Here is a very I think useful article by a Hong Kong - based economic strategist which makes the following several points: firstly that the United States resisted the idea of the Asian Infrastructure Investment Bank which is very clearly the creature of the Government of the People’s Republic of China. That does not make it a bad thing to do. As I say Labour supports joining it and supports the bank and a former head of the New Zealand Treasury Mr John Whitehead was I understand materially involved in setting up the governance arrangements for the bank and that is a good thing.But the point is that the United States was the primary sponsor of the Bretton Woods international financial institutions—the IMF the World Bank and the Asian Development Bank—and a perception has on the one hand grown up that perhaps they have not invested sufficiently in the infrastructure of some parts of Asia particularly South-east Asia and that there is therefore a gap in the infrastructure market. The political take on that is that there are some powers in the Asia region that would be very happy if that gap was not filled by what they see as American-backed mechanisms. They would rather have a Beijing-backed mechanism.That may or may not be the right thing. How does New Zealand align itself or take a position on that issue? That is a serious geo-strategic question but let us go into that debate understanding the underlying international political significance of this institution. This is one of the first—if not the first—major international financial institutions to be created since Bretton Woods was set up many decades ago. This is a major development. It signifies the rise of a new global economic power in Asia and New Zealand is confronted with a significant decision about whether to join or not. If it was not significant we would not be putting 140 million hard-earned dollars into it. That is a significant investment by New Zealand.The Hong Kong strategist goes on to note that China which is backing the Asian Infrastructure Investment Bank had sought to participate more actively in the Asia Development Bank but the largest shareholder in that is Japan and it always has a Japanese president and a high level of Japanese influence on its governance. So China understandably enough wanted to create another vehicle in which it had a higher level of influence. The strategist goes on to make the point that the counterfactual is that a lot of China’s existing resource and investment flows to develop the infrastructure of resource-providing partners in the region—and it mentions in particular a railway line in Laos as one example—have been done bilaterally rather than multilaterally and are often a little murky in their governance says the article.So the counterfactual is that we can be part of creating a new institution which has more transparent governance which is regional rather than bilateral and at which New Zealand has a seat at the table. Those are reasonable arguments to weigh up and the Labour Party has come to the view that in fact it is probably in our national interest to be part of that given that New Zealand former officials have been instrumental in the design.However I now want to turn to the select committee report and to the national interest analysis—so-called—that has been provided by our diplomats at the Ministry of Foreign Affairs and Trade. It is remarkable because there are no numbers in it. This is not the first time I have risen in this House and complained about the qualitative nature of a so-called analysis piece that should contain hard estimates on the return on the investment of $140 million of New Zealand taxpayers’ money. The kinds of lines that have been given out by the Government are that the main benefits to New Zealand include increased economic development in the Asian region—tick; with flow-on benefits for New Zealand—question mark. What are they? What are the transmission mechanisms? Has anyone done any kind of sensitivity analysis on the impact of trade flows or even mapped out which sectors they are likely to be in? There is no evidence of that kind of analysis. It supports increased economic integration in the Asian region—yes by definition it does but with a particular geopolitical slant. It augments our existing relationships. It most certainly does.Here is the key point: by signing up to the Asian Infrastructure Investment Bank New Zealand will be building its relationship with the People’s Republic of China. That is a good thing. At the same time New Zealand is busily according to the Government negotiating to be a party to the Trans-Pacific Partnership agreement thus ingratiating itself with the United States Government. So heaven it seems in an era of emerging superpower competition in the Asia-Pacific region is to be in good with both. That is not an illogical position for New Zealand. I just want New Zealanders to understand what is going on when we are spending $140 million of their money. That is what this is about. So this is about keeping a foot in the camp of an emerging institution that is Beijing-driven while also being part of a negotiation according to the Government of a Washington-driven Trans-Pacific Partnership agreement—thus keeping both sides happy. That is why we are spending $140 million here today. That does not mean it is wrong as long as we know why we are doing it and as long as we are well informed.I believe—and Labour believes—that New Zealand’s contribution is as an honest broker—as a country that is no threat to anybody a country with a reputation for integrity and transparency that has in the development of this proposal been able to contribute to the good governance of the bank with the transparency that that brings. Labour supports this bill but we do want New Zealanders to understand why our country is investing in it. Thank you.DAVID BENNETT (National—Hamilton East): That last speaker David Cunliffe came to a completely erroneous conclusion as we expect from him. But let us go back to some fundamentals of what happens in this area. There are three development banks that you really have in the Asia-Pacific region: the IMF which the Americans set up; the Asian Development Bank which is the Japanese set-up; and then you have this one which is the Chinese set-up—Hon David Cunliffe: ADB’s Bretton Woods.DAVID BENNETT: What did you say member?Hon David Cunliffe: The ADB was Bretton Woods—American sponsors.DAVID BENNETT: Yes but the Japanese are the main shareholders in it as you would see from your speech if you actually understood what you were saying when you read that quote from somebody in Hong Kong where it said that it was controlled by the Japanese. That is because it is the Japanese equivalent of the IMF. So it would be helpful if that member actually understood what he was reading—but that is another day.The thing is that in the world of trade we are a trading country. And what do you need as a trading country? You need customers. It is often seen through the development of whatever we do in this world that if you can bring other people up in their standard of living that increases the standard of living of your country because there are more people to trade with. Look what happens in Africa. The UN is completely about building trade by building the people’s ability to become middle-class citizens in the world. It is what has happened in Asia. It is what will happen in Africa in the next 50 years and that is the important part of lifting people out of poverty. It gives them the ability to get an education and it gives them the ability to then buy our products and goods and services and that is what we want.These banks are designed to provide infrastructure so that those countries can develop further. I went to the Asian Development Bank meeting this year and at that meeting it was really interesting. They said that a city the size of—basically—Tauranga or Dunedin is being produced in that Asia-Pacific region every week. So every week you get a city that size coming on board with over 100000 people with your standard of living. So that is the reality of what these projects deliver. They deliver the connections through the Asia-Pacific region to enable that to happen and they are consumers. They are consumers who can buy our goods and services. That is the important thing. It lifts those people out of poverty so that they can make the right decisions around the environment. They can make the right decisions around their economy and they can make the right decisions around their personal and human rights.Those are fundamental things that I thought the Labour Party would have stood up and understood—not try to look at the finance of the Asian Infrastructure Investment Bank. The New Zealand First Party will never support this because that party is anti-Asian. It is a party that is against having New Zealand in the world order. It is a party that has demonstrated in this House this week how disgusting and trivial its members are. I would like to thank David Seymour for his time at question time for standing up for members of our party and I would like to apologise to the New Zealand public on behalf of the New Zealand First—The ASSISTANT SPEAKER (Lindsay Tisch): Order! [Interruption] Order! We are not on that debate.DAVID BENNETT: So it is important that we look at this bill because it is creating something that will create more markets for New Zealand products. It is about building that relationship with our region that we live in and this is a good bill.A party vote was called for on the question That the International Finance Agreements Amendment Bill be now read a second time.Ayes 109New Zealand National 59; New Zealand Labour 32; Green Party 14; Māori Party 2; ACT New Zealand 1; United Future 1.Noes 12New Zealand First 12.Bill read a second time.Support for Children in Hardship BillSecond ReadingHon ANNE TOLLEY (Minister for Social Development): I move That the Support for Children in Hardship Bill be now read a second time. The Support for Children in Hardship Bill enacts this Government’s $790 million package to assist children living in severe hardship and can I thank the Social Services Committee for its work on this bill. The package and the measures set out in the bill represent our strong and ongoing commitment to tackle the material hardship amongst children in low-income families improve the lives of our most vulnerable and get better outcomes for these children.Over the past 6 years we have put in place a number of initiatives to support our most vulnerable children and these include free GP visits and prescriptions for children under 13. We have expanded the Kick Start Breakfast programme to all primary and secondary schools. We have extended Social Workers in Schools to all decile 1 to 3 schools. We have introduced a suite of changes under the Vulnerable Children Act to protect and help vulnerable children to thrive and we have developed the Children’s Action Plan to combat child abuse and neglect including the roll-out of 10 children’s teams working with at-risk children and their families.The measures in this bill build on our progress to date and reinforce the Government’s commitment to support this country’s most vulnerable children so that they have every opportunity to live successful lives. Firstly the bill strengthens work expectations for sole parents and partners of beneficiaries. Once their youngest dependent child turns 3 they will be required to be available for and to seek part-time paid employment of 20 hours per week. Twenty hours of employment a week is enough for sole parents to be independent of benefits. With Working for Families tax credits a sole parent living in Tauranga and working 20 hours a week could be $192 a week better off than they were on a benefit.The bill also increases financial assistance for low-income families in work and those on a benefit. From 1 April 2016 the main benefit rates for families with dependent children will increase by $25 per family per week in addition to any inflation adjustments. The bill also increases Working for Families entitlements to assist children experiencing hardship in low-income working families. These changes will see the in-work tax credit increase from $60 to $72.50 per week with the minimum family tax credit also lifting by $12 per week.Can I again acknowledge the efforts of the Social Services Committee in its consideration of the bill and I commend the committee for its work on this very important piece of legislation. The committee received 31 written submissions and heard 16 oral hearings on the bill from a number of organisations and people working with some of the most vulnerable children in our communities. Overall submitters expressed clear support for the bill’s intent to improve the outcomes of children living in severe hardship and like these submitters we too have a strong desire to do better for these children. During the select committee’s consideration of the bill many submitters commended the Government for taking the steps to increase the main benefit for families with dependent children. The increase was seen as a significant and important change in helping those families meet the basic needs of their children.The bill recognises that hardship is not just an issue for families reliant on the benefit system. It also impacts on low-income working families as well. Over one-third of children in hardship come from these families. The committee heard concerns from some submitters over the level of increase in financial support for beneficiary households with dependent children. This bill will enact the first increase to the benefit rate outside of inflation adjustments in over 40 years and is an approximately 8 percent lift in most sole parents’ base rate of benefit. This is a significant step and it will ensure that these households are in a much better position to provide the basic necessities that are critical to their children’s well-being.Submitters were concerned about the level of the increase in Working for Families assistance including the planned increase in the abatement rate of Working for Families tax credits. The changes to Working for Families are expected to benefit an estimated 203000 working families and 383000 children. The increase to the abatement rate means the package is targeted at children in the lowest-income working families. To further support these households the Budget package provides for an increase in childcare assistance to $5 per hour which will provide important financial relief and reduce the barrier to work that childcare costs can often be.Submissions on the bill raised concerns around the extension of part-time work obligations and in particular how these would be applied to consider the needs of families and their children. For most families the best way out of poverty is for parents to find sustainable full-time work. Many sole parents recognise this and are already choosing to return to work sooner. By the time their youngest child reaches 3 half of all sole parents and two-thirds of all partnered mothers are in paid employment in New Zealand. Over the last 20 years the largest gain in employment for all mothers has been in the group where the youngest child is aged 3 to 4. So the Government’s focus remains firmly on getting beneficiaries into employment because a paid job offers a better future for those who are able to work and much better prospects for their children.There was some suggestion made during the select committee process that steps should be taken to define “suitable employment” in legislation. This is an issue that was well canvassed during this Government’s welfare reforms in 2012. A rigid definition of “suitable employment” simply would not be practical given the dynamic and changing nature of life that families experience. Under the extension of part-time work obligations Work and Income will continue to exercise flexibility around the type of work that is suitable for a parent’s circumstances. Case managers will consider a range of factors such as access to childcare the nature and wages of work location of employment a parent’s skills and experience and family commitments. Continuing with this flexibility will best support families by enabling the Ministry of Social Development to consider their specific circumstances in being able to move to paid employment.In considering the bill the Social Services Committee recommended two minor amendments. The first amendment relates to the definition of “part-time work” under the Social Security Act. The bill intends to increase part-time work obligations for work-ready parents only. It inadvertently also changes part-time work obligations and the capacity for work test for jobseeker support clients with a sickness injury or disability. This was not Cabinet’s intent and the amendment clarifies that. The second minor amendment replaces references to supported living payment or jobseeker support with the term “main benefit” under this bill. This amendment is needed to ensure that the benefit rate increase is correctly applied when a supported living payment or jobseeker support beneficiary is partnered with someone on the emergency benefit. It will ensure that the $25 increase will be evenly split between both parents providing greater clarity on how the benefit increase applies in this situation.It is critical that we support our most vulnerable children so they are able to live rich and fulfilling lives like the majority of other New Zealand children. This Government continues to embark on its ambitious programme to improve the lives of vulnerable New Zealand children. The measures in this bill form an important part of the Government’s ongoing plan to support those children. We are committed to doing better for our children and this bill represents a significant step towards ensuring we deliver on this. I commend the Support for Children in Hardship Bill to the House.SUE MORONEY (Labour):I rise to lend Labour’s support to the Support for Children in Hardship Bill at its second reading. But as is the way of this Government this is really the Government doing as little as it can possibly get away with while trying to ease its own conscience about the large increase in children living in poverty under its watch. And although this bill is not going to address the issue the Labour Party will support it because doing something is better than doing nothing. But that is about the best that I can say about this bill because in fact it will not address the issue that the Government purports that it will address.The Government and the Minister for Social Development who just spoke are trying to paint a picture where this bill is going to lift children out of poverty. Well in fact what the Social Services Committee found was that for each family and actually for the small number of families who are going to be entitled to this $25-a-week increase in their income the per-family rate will end up being $23.10 a week that they are going to be entitled to. When we think about where this bill is targeted this bill is targeted at the families who are in the most severe hardship. They are severely below the poverty line. And so in thinking about that although it is going to make a little difference $23.10 for that whole family is not going to lift any of those children out of poverty. It will alleviate things a little but not a lot so it is not going to fundamentally address the issue.Sadly in Aotearoa New Zealand a food-producing nation 305000 children live in poverty in this country. That is a disgrace. That is something that none of us should tolerate and that we should not feel at all pleased about. The National Government for three elections in a row has promised a brighter future—it promised a brighter future. What is the result? There are 305000 children in this country living in poverty. That is a disgrace. That is an utter disgrace. And the best the Government can do is at this late stage start offering $23.10 for these families to try to claw their way out of poverty. But at the same time National has got housing costs policies going through the roof—that Government’s policies have got housing costs going through the roof—it has got childcare costs going through the roof and it has got all of these increased pressures on families. And the best the Government can do is offer $23.10 per week to the families who are in the most severe hardship.Jono Naylor: Ha ha!SUE MORONEY: Well it is all about priorities. Government members are laughing about it but it is all about priorities. What do we hear the Prime Minister spending most of his time talking about? He is talking about a flag referendum and spending millions of dollars on that. He is talking about cuddly cute pandas and spending millions of dollars on that. But when it comes to addressing children in hardship the Government does not have an awful lot to say or an awful lot to offer.There are measures in this bill that will make things a tiny little bit better but there are measures in this bill that will harm families. I am going to talk now for a few minutes about this new requirement for families in receipt of benefits and social welfare payments when their youngest child turns 3 to go out and be forced to find part-time work of now 20 hours a week. So I want the people of New Zealand to think about where these jobs are. Where are these jobs? Yesterday the unemployment figure increased to 6 percent for the whole country. But in my region in the Waikato region it increased to 6.7 percent. That increased by 1.7 percent over the course of just the last 3 months. That means that 3800 more people in the Waikato are out of jobs now who were not 3 months ago. So where are these 20-hour-a-week jobs that all of these women primarily are going to be forced to go out and find when their youngest child turns 3? Where are they? What sorts of jobs are they?Well here is my guess: the sorts of jobs they are being forced to accept because of this provision under this mean-spirited Government are the zero-hour contract jobs that the Government purports to be against. In fact in another piece of legislation it is codifying it to make it legal for people to be required to work these zero-hour contract jobs. Those are the jobs that these women are going to be forced to accept: jobs with no security jobs with no certainty over income—and then the $23.10 a week is going to start looking pretty sick. It is going to be looking pretty sick indeed because that is the mechanism that this Government is using to force people into less and less secure environments—less ability to provide for their children less ability to plan for the future.Try going to ask for a mortgage at a bank with a zero-hour contract job because the first thing the bank is going to ask you—the first thing many financial lending institutions ask and the first thing many places where you get financial support ask you—is what is your weekly income. For many of these women who will be forced to go out and look for these jobs and accept them when their youngest child turns 3 they will be forced on to these sorts of insecure jobs.What is that going to mean for their family lives? What it is going to mean is that they are going to be required to make themselves available but have no certainty of work. They are going to need to find childcare and not have any certainty that they are going to actually get the income that allows them to pay for that childcare. So these are the very real situations that all of these most vulnerable families are going to be forced into as a result of this legislation.If the Government was serious about lifting children out of poverty then it would look to the sorts of policies that the Labour Party has put forward. I am going to spend a couple minutes talking about our Best Start package because if the Government was serious about this it would look to a comprehensive package like the one that is proposed by the Labour Party—that is that every child—Hon Maurice Williamson: How’s that package going with the public?SUE MORONEY: Well how is the package going? I am going to test it out right now Mr Williamson because this is the package that would really make a difference: $60 a week extra per child for every child under 12 months of age—for every child under 12 months of age. The Government asks—because this is the only thing that the National Government can think about—how the country can afford that. How can the country afford its failed policies that are actually increasing unemployment and not getting us anywhere very fast? How can the Government sit there and be proud of its record when in fact all of its policies right here right now are demonstrably failing—they are demonstrably failing.So $60 a week for every child up to the age of 12 months and for those families at the lowest end of the spectrum that $60-a-week payment would continue up until that child’s third birthday. That would make a difference. If I was the Minister who just resumed her seat—she should feel ashamed. She should feel ashamed. She got up there and proudly said that a third of the families in the severe hardship category are from families where the parents are in paid employment. Shame—shame on the National Government that you believe that that is OK. It is the National Government’s policies that have a third of the people in the severest hardship out working—those children have their parents out working. Their parents are in these zero-hour contract arrangements and these parents are being forced out to find these inadequate insecure jobs once their children turn 3 and that is nothing to be proud of.The ASSISTANT SPEAKER (Lindsay Tisch): I am sorry. I neglected to ring the 2-minute bell but you have had more than 10 minutes. That was the concession for my faux pas.ALFRED NGARO (National): There was a time when in the Labour Party its strength was actually being able to talk and being able to plan and to initiate social policy that was in much need by the New Zealand community and New Zealand society as a whole. After that last speech it is no wonder that there has been a struggle because that member Sue Moroney was not part of the Social Services Committee to read the 31 submissions and hear the 17 oral submissions.Sue Moroney: I still know what’s right and what’s wrong Alfred.ALFRED NGARO: That member did not speak on the bill and when that member began to turn round and attack this bill let me remind that member about this thing. I remind the member not to worry; the people at home can hear only my voice and not hers so good for them. The thing is this: this member here should have been at the poverty debate that I was at where Ms Jacinda Ardern got up and spoke. When she was challenged about the children in poverty during the 9 years of a Labour Government and when she was challenged about the fact that the state of the nation reports by the Salvation Army condemned and criticised the Labour Government for not doing enough and criticised it for the so-called wealth that it had available to it saying that it did not make a difference to the issues of poverty here was the response that Mrs Moroney might want to listen to—Ms Ardern’s reply to those questions. This was her response: “Well it was a job unfinished. It was a job that we did not complete.” Those were her exact words. In other words in 9 years—when you had plenty when you had enough when you could have gone and you could have reduced the amount of poverty of children—that previous speaker did nothing. So it is with arrogance that that member stands up and uses the word “shame”.We know that there are children in hardship. We know that is important. Those members over there—if they stop if they do their homework and if they look back into their own past—will realise that they had also failed in addressing this issue.I want to talk about what this Government is doing to address the issue of children in hardship. I must say though that as a select committee hearing those submissions we came to a point where there was unanimous support for the bill heading into a second reading and third reading back in the House. Why? Yes we know that the fact is that for some it did not go quite the way they wanted. However the intention was right. The direction that this Government was moving in to increase the base benefit rate which had not been increased since 1972 was the right one. So we got the support that we believe is important to this bill.This is part of the Government’s Budget package in 2015 addressing the issues of children in hardship—$790 million over 4 years. It is a significant investment. It is an investment in which we want to get to a point where we cannot say that it is a job unfinished but we also know that poverty is a difficult issue and it is a challenging issue for all Governments right throughout the world as well.I want to return to the regulatory impact statement—[Interruption] The member may not have read that. I do not think that previous member that previous speaker had read the regulatory impact statement. It talks about the meaning of “poverty” the definition of “poverty”. But it also talks—because that member also talked about 305000 kids in poverty. Well if that member bothered to read the regulatory impact statement here is what it says. But that member does not—it says this. So what do we know about child poverty and material hardship? How many children are in poverty or in hardship? There are no simple or single-figure answers to that question that would command respect or support. That is right—this is from the regulatory impact statement which clearly defines it. Why? Because you can bandy about 305000 as a figure that you can cite and leverage support for out there in the community but the question you have to ask is this: how many are really in that continuum of poverty and hardship that we need to address and who do we need to provide that support to? That is what this Government is doing. It is targeting its support in the right place in the right way because we know there is need for that.Here are the key elements in this bill as it returns to the House that we know are important in addressing the issues of poverty. In fact when it defines “poverty” it defines it in three ways. It talks particularly about the issues of hardship and difficulty in a home. There are three things—firstly low household incomes; secondly it talks about the demands to meet the needs of budgeting in that house; and thirdly which is probably the most challenging is this: the ability to use your household income in appropriate ways. In other words it often has to deal with people’s attitudes towards the household income. We do not often talk about that but that has come into the regulatory impact statement.What this Government is doing in this bill is important to address those issues and here is what the Government is doing: it is strengthening work availability obligations for beneficiary parents. We know—the research has shown—that those who stayed longer on benefits would often come to a point where actually it becomes more difficult for them to provide a better future and better incomes for their children. We think that is important. Lowering the age of the youngest dependent child at which part-time work search obligations are work-tested for beneficiaries will go from 5 years to 3 years. Changing the target hours of part-time work from 15 to 20 hours—we know that the intention of this is important. We can see that this is a way of actually helping those families. It is targeted at those who are in need—sole parents. We have wrapped round support we have raised the benefit levels and we have also increased the abatement levels in there.This package is not the answer to all things but it is definitely as in the words of the Opposition support in the right direction. So I commend this bill in its second reading to the House.Hon NANAIA MAHUTA (Labour—Hauraki-Waikato): I am a bit concerned about the way this debate is going based on the contribution of the previous member Alfred Ngaro. The member failed to admit that when Labour was last in Government we recognised that poverty was not an easy issue to address. It was systemic but there was a whole range of other initiatives that Labour addressed to help alleviate some of the biggest pressures facing vulnerable families.Let us look at some of them. Income-related rentals—we ensured that in the State housing sector those families that were on low incomes and were the most vulnerable had access to income-related rentals paying no more than 25 percent in some instances. It made a huge difference in communities and we certainly did not sell the houses off. The other thing that we did was we introduced 20 hours’ free early childhood education so that parents had access to quality early childhood education and had the guarantee of a qualified early childhood education teacher. If that is not investing in the future I do not know what is.But we also reinstated the training incentive allowance. I campaigned in 1996 when National was in Government and it did away with it. Labour promised it would bring it back because it knew that by investing in women and ensuring that they had pathways back into education it was going to help lift opportunities for the most vulnerable families and get them on a pathway to sustainable employment.Hon David Parker: Working for Families.Hon NANAIA MAHUTA: Labour also introduced Working for Families and we ensured that those people who were on the pathway to sustainable employment could also get the type of support that would guarantee a lift up and a hand up not a handout. We know the importance of getting people into employment and we had in our region alone—myself and Sue Moroney in the region of the Waikato—unemployment at its lowest. Unemployment was down to 3.2 percent—at its lowest—and that is where the rubber hits the road for us because we know what the benefits of Labour’s contribution in the last 9 years of our Government looked like for families in need.Statistics do matter and the numbers tell a very serious truth. Here is where the rubber hits the road for me: 97000 Māori aged 18 to 64 years and their household whānau are welfare-reliant right now. Right now 26 percent of Māori adults are welfare-reliant and that is a shame because in the last quarter there has been no movement right to this minute. Today in question time we challenged the Government because Māori unemployment currently sits at 12.9 percent. That is a shame because when we look at this bill the Support the Children in Hardship Bill which looks at work provisions we cannot deny that the Government has failed to address the issue of job creation because unemployment is going up certainly for Māori.The previous speaker spoke about being more conscious of household income. Well here is where the rubber hits the road for Māori. The median Māori household income is $28000 15 percent lower than any other group. So there is not a heck of a lot of disposable income and if this bill is going to help those most vulnerable I know where the great majority of the whānau that he is talking about are and that is in many of the communities that we represent. More important—and the member Sue Moroney made this very significant point—more children are living in poverty. Let us look at the numbers. Around 33 percent of Māori are living in poverty—around about 215000 people 94000 of whom are Māori. It is unbelievable.When the Government talks about “material hardship” I think it is a convenient term. It cannot get away from the fact that there are a number of families in our communities who want work. So when they look at the 20 hours’ work provision in this bill where are the jobs? For those mothers who have children who want to work where are the jobs? And if they do not have access to a car and have to travel 30 kilometres away on public transport to get that 20-hour job what childcare provisions are available in their small town to get that job?Then we have got to ask ourselves: is this the best way in and of itself to alleviate poverty? The simple answer is no. It is something but in and of itself it is not the best way. There are far too many things happening that negate the benefits that the Government is promoting around the Support for Children in Hardship Bill. The insecurity of work for a lot of vulnerable families makes them more prone to the whim of their employer and this is really difficult. I come up against this a lot. In fact I visited a school and I talked to a mother who had four children. She is working and she is very proud of the fact that she is working but she does not consider it a stable job. She believes that at any minute her employer could just tell her to walk. She has got four mouths to feed. Her and her husband’s combined income does not earn them more than $40000 a year. They consider themselves proud people who will work but that kind of environment makes it very difficult.This bill as I said has made a number of considerations and as the Minister for Social Development has pointed to a number of changes to the definition of “part-time work”. I can only say that in reading it—and I am not a member of the Social Services Committee—I have to ask the serious question: is this a part of a systemic approach to addressing the issues of poverty? Because the chair of the select committee Alfred Ngaro himself said that these are big issues. There is no single answer and if there is no single answer we cannot debate this issue in isolation from all the other aspects of poverty that impact on how families are feeling the struggle. And the struggle is real today—the struggle is real today.I read with interest some of the submissions but also some of the comments and it would seem to me that by investing in other aspects of those raising vulnerable children there could be other ways to improve circumstances. Again I would make comment about the training incentive allowance. What greater investment could be done than to ensure that women raising children had access to the training incentive allowance to lift their skills and lift their opportunities? They have got a Cabinet Minister who has had this very direct experience yet that is not a reality for a number of families who the Government purports to support.The other thing is the value of volunteer contribution. Again I come across a lot of young mums who try to help out at the local kōhanga or the local early childhood education centre and they believe that contributing there getting their confidence up and being able to learn the parenting skills from that type of environment is about contributing not only to that community of children but also more important fundamentally to their own raising of their child. These are the types of unseen investments that the country or even the Government could recognise make an equal satisfactory contribution to the raising of children who can reach their potential—not just simply a $25 increase. Yes it is a start but is it everything? No it is not.Will Labour support it? Yes we will recognising that the issues around poverty are systemic. This is not a blame game but this is a very serious challenge if the Government really believes in what it is saying to set targets to eliminate and reduce child poverty now. Do not wait—do not wait and then just sit there glibly and blame Labour when we were last in Government. Let us do something about it. Let us across Parliament agree that targets are necessary. Let us look at the range of policies that will alleviate poverty so that we are not debating this issue in another 3 years’ time but are actually tracking on how policies are fundamentally reducing poverty and fundamentally improving the lives of young people. That is what the children’s policy under Labour attempts to do: look at the issue systemically and try to ensure that we can track progress.This is a second reading. No doubt the Committee stage will be robust. I look forward to ensuring that we have a fruitful debate around the broader issues of poverty and where in context this bill actually will or will not make a difference. Kia ora.MATT DOOCEY (National—Waimakariri): It is an honour to rise and speak in support of the second reading of the Support for Children in Hardship Bill. Just picking up where that last member Nanaia Mahuta finished I agree: it is a very complex issue and one that we need to work across both sides of the House on. I feel that is where we landed with this bill after our Social Services Committee work: that across the parties we felt that the intent of the bill was correct and we were working through the detail.I must say for myself that like many young New Zealanders I had the fortunate experience of going overseas on my OE and it gave me a great understanding and experience to understand a range of other countries and the levels of aspiration and the levels of quality of living that young people grow up with in other countries. It really made me proud to be able to come back to a country like New Zealand and bring up my kids here. The reality for some young people in New Zealand is though that they do not start off on the right foot and they will not enjoy the many qualities of life that the average New Zealand child will enjoy. I think it is right that this Government is putting in place measures to address that.What we need to do is stay focused on the facts. We know international research and it is demonstrated in the departmental report has identified that the most effective way of reducing the risk of family poverty enhancing child development and generally giving the best possible start in life is getting into paid work. That is something we need to be supporting. The Salvation Army state of the nation report identified that the decrease in child poverty the decrease in the numbers presenting to food banks was in exact correlation to job creation. We know that this Government is working hard and can do better at creating jobs now and in the future. It is right that we are focusing on a bill that will support beneficiaries getting into employment and provide the support they need—the childcare support.One of the main arguments that we had through the submissions process—we received about 31 submissions 15 of them orally—was about the tension of children infants to the age of 3 going into early childhood education. But we listened to Russell Wills the Children’s Commissioner and he identified that actually that is the average age that infants are going in—at the age of 3. He wrote that participation in high-quality childcare is beneficial for children particularly if they are disadvantaged and live in hardship. That is very much the intent of this bill. So I wholeheartedly support it and look forward to it going through the further legislative process. Thank you.JAN LOGIE (Green): Tēnā koe Mr Assistant Speaker. Tēnā koutou e Te Whare. I think it is important to start this speech with the voices of New Zealand children provided through a report by the Office of the Children’s Commissioner describing what poverty means for them. So I am going to quote from children in this country: “Sleep on the floor—wooden floor.”; “No power—can’t pay their bills—can’t cook no heating.”; “Not enough money to pay for basketball fees/sports.”;“You can’t go to the pools and learn to swim.”;“Scavenging for food just to eat for a night.”; “You get bullied because of your appearance—they look at your clothes and mock you.” This is currently the reality for thousands of children in this country right now.If I am honest I feel like I am swallowing a bit of a dead rat standing here today to vote in support of this misnamed bill the Support for Children in Hardship Bill. This bill pretends to support children in hardship when the reality is that it represents a conscious decision by Minister Tolley and the Government to not move children out of poverty. What this bill does instead is take money from struggling families to provide an average of $23.10 per week to our most poor families and to provide an additional $12 a week in tax credits for 4000 families. That is deeply deeply frustrating to me.There are 305000 children in poverty in this country. Two out of five of these children have working parents. Otago University research shows that 60 children a year are dying of lowincome-related diseases in this country. The Government was told that to lift any—not all not even most but any—children whose parents are unable to work out of poverty above the accepted poverty lines it needed to increase benefits by an absolute minimum of $30 a week. Instead it chose to offer us benefit increases of an average of $23.10 per week. It would have cost only a few more dollars a week to be able to get at least some of those children over the line and out of poverty. I believe it does an absolute disservice to us as a country and to our concern for our children to offer that amount.The Government is saying to us as a country that these tiny increases reflect our collective concerns for those thousands of children sleeping on floors and scavenging for food. Well it does not reflect the Green Party’s concern and it did not reflect the concern of submitters who wanted a comprehensive solution a brave solution to address these problems. We are supporting this bill today because we cannot vote against that extra $23 and $12 for those families who today have empty fridges for those children who are scavenging for dinner. But this in no way reflects what we think is right. If I try to detach from my emotion on this issue I can acknowledge that this inadequate increase is at least a formal acknowledgment of the State’s responsibility for alleviating child poverty and that is something.But the Government is taking from the poor to pay the poorest. By increasing the Working for Families abatement rate and lowering the threshold for Working for Families the Child Poverty Action Group pointed out the Government is failing to protect the working poor. In fact by its calculations a family earning the minimum wage working 60 hours a week getting $46000 a year will now be over $2000 a year worse off. These are poor families from whom this Government is taking their money to pay the absolute poorest when some of us in this House could actually afford a bit of our income. People on our incomes could afford to pay a bit more tax to be able to address child poverty in this country. It should not be taken from the working poor.Anne Tolley has said that she will only do this pitiful bit to help our children if their parents do more in return. Let us be clear: this is more for the Government not more for their kids. The Government is saying that in return for a small contribution from the Government parents need to give up their right to choose how to parent their children. They will be required to look for 20 hours of work a week from the time their children are 3. This policy really—the underlying message of it—is that these families are work-shy and ignorant of what is best for their children. And we heard from the Minister for Social Development that there will be discretion here—Work and Income will make the decision on whether it is appropriate work for that family not that parent. The Minister thinks Work and Income is best placed to decide on what is appropriate for the needs of a child.We heard from the previous speaker that the Children’s Commissioner acknowledged that the average time that parents go back into the workforce is when their child is 3. Sure but that is missing the difference between shared parenting and sole parenting. It is missing the difference between the reasons why so many people are on Work and Income benefits due to family breakdown and the needs of different children. There will be children in this situation who have disabilities for whom Work and Income will decide on behalf of their parents how much time the parent can spend with them—taking that choice away from parents. It will be over 14000—that is a horrible under-estimation. Families are leaving violent relationships and I know from having worked with those families that their children need them. For a Work and Income officer who has no knowledge of those children to decide when it is appropriate for that parent to be going back into work and losing that relationship and ability to be on Work and Income assistance is frankly wrong.And we are further concerned that making parents look for that 20 hours of work a week may compromise their ability to participate in kohanga reo aoga amata or Playcentre models of early childhood education which require substantial parental involvement. As has been pointed out by a previous speaker these models have substantial benefits to families. And we believe that the right to participate in those models needs to be protected.There is so much awfulness in this bill. The decision to increase an assistance to be per family and not per child is going to lock in ethnic and financial inequality because we actually know that New Zealand is blessed in some ways that we are protected from the very worst of the ageing population crisis faced by other OECD countries by the higher birth rates for Māori and Pasifika. But that means the families are larger and they face institutional discrimination that is blocking them out of the workforce. So their children—while we should be nurturing them because they are the future of our country and our workforce we are going to be penalising those families compared with smaller families of other ethnicities. That will have a long-term cost for us.There is so much more I could say but I want to wind up now with more words from children about what they want from us. This is another quote from the Children’s Commissioner’s report. They say: “Everyone is equal. We have the same potential as everyone else. Don’t put barriers in front of us and don’t leave us in the ditch. Help and support us our families and communities. How can they [the Government] expect us to look after this place New Zealand in the future if they are looking down on us …”. This bill hands snacks to children in the ditch. By supporting this bill we are supporting children’s right to eat but we are deeply offended that we are being asked to leave them and their parents in the ditch.DARROCH BALL (NZ First): It is a pleasure to rise on behalf of New Zealand First to speak in the second reading of the Support for Children in Hardship Bill. We will be supporting this bill during this stage but I believe that the title of the bill is a bit of a misnomer when it is concentrating on children because in fact it is not and a very fundamental reason why is that the benefit increase is not being directed at children at all. It is being directed at the families or the individuals within those families and that opens itself up to a massive flaw from the get-go. If you have got a larger family the children themselves individually get less of a benefit. That is to start off with.It seems to me like this Government brought in this legislation more for the point of wanting to hang its hat on the fact that it is the first Government to increase the benefits for 43-odd years because every time a National member stands up that is exactly what they say. But what they do not mention is the fact that in 1991 a National-led Government slashed the benefits by around 25 percent or a third. And if we are looking at the most vulnerable children in this country right now it is not only those children who are in benefit income families but also in fact those children in sole-parent benefit families. If you actually have a look at the statistics in 1990 a sole parent benefit was around 77 percent of the average wage and if you have a look at year by year going down through to this year this year it is only around 50 or 51 percent of the average wage. So when you have got the Government saying that it is the first Government in 43 years to increase the benefit—Todd Muller: It’s because we are.DARROCH BALL: Yes but how much was it cut in 1991 and how much of the gap has spread since then? It is a token gesture at best.The Minister actually said in her speech that the vast majority of submissions and people who came in actually agreed with the bill and the intent of the bill and of course they did because it is not necessarily that they agreed with the legislation or the intent; it is that they agreed that there is a need there and they are desperate for that need. And of course they are going to take anything that they can because that gap that they are in is really forced poverty or supported poverty like I said in my first reading speech. It is supported poverty. This Government is currently supporting people on the benefit especially sole parent benefits to be in poverty.This is actually an opportunity that the Government has squandered to address child poverty directly. When we hear the term “child poverty” it actually is a little bit more than that because every child who is in poverty is in a family that is in poverty. On a bigger scale if a family is in poverty then so is the community itself so it gets even bigger to a nationwide level of poverty. That does not mean that every single individual within that nation is in poverty but the policies that are implemented at the national level do affect the poverty down at the other end. At the moment this legislation is just tapping at the symptoms of the issues of poverty that we have in this country.At the very bottom are the sole parents as I mentioned. This should not really be a discussion or a justification of giving a handout to beneficiaries but unfortunately this is what it has become. We have got a justification for increasing benefits and why we need to increase benefits or why we should not increase benefits and that we are doing a good thing by doing that in the first place. If it was actually about lifting children out of poverty it would be a lot more comprehensive. The amount that the benefit is increased would be a lot more than just $25—and of course as we have heard it is not actually $25; it is a lot less than that and it is not per child. It is not for the individual children; it is for the families.I would just like to read a couple of points that I would like to make out of the minority report that was submitted. It states in there that families with more than one child is where the hardship is likely to be more significant. The Children’s Commissioner himself actually said that the amount of about $12.50—for example if there were two parents both on benefits they will be getting $12.50 each—will not incentivise a parent to leave a benefit given the high cost of quality childcare being a barrier. One of those main barriers is that childcare cost.We have actually heard recently—I think there was an article within the last sort of week or two where an individual on the benefit did a calculation and in fact they would be better off technically on a benefit rather than going and finding work because of all those hidden costs; because of the childcare because of the petrol costs. So this legislation although we agree with the intent—just like every other submitter agrees with the intent of the bill—it is the lack of robustness in the legislation that we disagree with. It lends itself to having flaws. We support the recommended change by the officials to amend the proposed definition of “part-time work” being that it is retained at 15 hours for job seekers with sickness injury or disability.Alfred Ngaro looked at the regulatory impact statement. I will do the same. There are a couple of things that I would like to highlight out of it in the components of the final package itself. It says that there are 108000 beneficiaries who on average would gain around $23.10. Of course that is not beneficiaries themselves—it is actually the entire family who would gain that. But hidden right down the bottom in small print—in fine print literally—it says that there is actually an increase in the rent that social housing tenants receiving a benefit will pay so “The Income Related Rent charged to social housing tenants is set at 25% of their income” and their rent will actually increase by over $6. That was in the fine print. So if this legislation was actually a robust piece of legislation and wanting to fulfil the intent then those sorts of things would not occur.Across the page in the net impacts of the package it states concerningly that “As a result of the benefit rate change around 4000 non-beneficiary households will see a small decrease in weekly income from the Accommodation Supplement …”. In fact it goes on to say “that sole parent families will benefit more than couples from the benefit increase”. So that actually proves a couple of things. One is that although some individuals will have the increase and it is much needed there are also families that will have a decrease because of this legislation—not only that but some families will benefit more or less depending on how many children they have. That actually points to the fact that this is not legislation that is aimed directly at the children. It is actually aimed at the main beneficiary themselves.Just looking very quickly at a couple of the submitters the Every Child Counts campaign submitted a two-page submission. I have highlighted one of the main points. It highlights the fact that this is not a child poverty issue; this is a community and a family issue. It recommended that along with this legislation there should be a sustained programme of work across a range of areas. It noted that Māori and Pasifika are disproportionally represented in child poverty that resources and support for community-led development needed to be included and that there needed to be adequate income affordable housing support for parents and accessible and quality early childhood education. So there are a number of things that have been left out of this legislation.Right at the start I said that the Government had the potential here to actually really have a good go at addressing child poverty but it has been squandered a bit. New Zealand First will support this legislation at this stage of the process. I will be looking forward to having a go during the Committee stage. Thank you.TODD MULLER (National—Bay of Plenty): I rise for a short call in the second reading of the Support for Children in Hardship Bill. We had 31 submissions and 16 then submitted in person. All—every single one of them; that may well have been lost in the narrative to date—were generally supportive of the intent of this bill to improve the lives of New Zealand children living in material hardship. If I can quote just one submission from the Child Poverty Action Group not known for its echoing of the National Government’s direction it said: “CPAG is pleased that the government has acknowledged the role adequate income plays in child outcomes and is pleased that there is no attempt in this Bill to confine the increased income to only those children exhibiting hardship.” So from all quarters we have had unanimous support that the intent of this bill was heading in the right direction.I have to acknowledge that there were of course two or three areas that had some debate and concern covering obligations and the nature of the support that is proposed and I particularly want to talk about the obligations this afternoon. The specifics that were raised through the select committee process related to the obligations that we now have on sole parent support beneficiaries and partners of those same beneficiaries around lowering the age of the youngest child at which the part-time work obligations kick in—from 5 to 3 years—and changing the hours of work required to meet that part-time work test from 15 hours to 20 hours.You have already heard in this debate this afternoon some highly emotive and I think quite extreme responses to those sensible obligations to ensure that when your youngest is 3 you ready yourself to get back into the New Zealand workforce. Through the debate I was significantly convinced by the advocacy of Dr Russell Wills the Children’s Commissioner who when talking to this point specifically said: “The research indicates that a parent obtaining full-time paid employment with sufficient earnings is the most important event to lift children out of poverty.”He then went on to say in respect of the obligations around moving from 5 years to 3 years—and although this is a significant quote it is worth adding to this debate this afternoon. This is again from the Children’s Commissioner: “I can’t see a good reason for the age of return to the workforce being different to people who are currently working than parents who are going to work for the first time from a benefit. Therefore 3 years old is a reasonable choice and 20 hours of work will increase that connection to work.” So this is the Children’s Commissioner—whose report has been echoed here this afternoon ad nauseam—speaking very clearly without debate that the move from 5 years to 3 years and the move from 15 hours to 20 hours are appropriate for New Zealand and are appropriate for this group to connect them back to the New Zealand economy because that is how they lift themselves and their families out of poverty. That is why we have this policy in place and why it enjoys the support not only I am sure ultimately of this House but of the wider country.Finally I would like to make a couple of points in respect of the concern that was raised around the obligations that we have of putting people back into suitable work and some concern around what suitability looked like. In my view there was far too much of a paternalistic view from the other side that jobs needed to look a particular way otherwise it simply was not appropriate for people to put themselves forward for such part-time work as if somehow the Labour Opposition knows a view of what works best for people out there. It is paternalism at its highest order.I do want to make a final point around flexibility. It is absolutely clear that there already exists a highly flexible approach from Work and Income that looks at the individual looks at the family situation looks at the part-time work that is on the table and puts a sensible solution together that works for them works for their family and works for the country. I strongly support this bill.DAVID CLENDON (Green): It is with no great pleasure that I take a call on this piece of legislation the Support for Children in Hardship Bill. As my colleague Jan Logie has said we are supporting this bill but simply because it would be perverse not to support even the most begrudging parsimonious increase in support for our least well-off families—for our least well-off children. The previous speaker made the comment that there was unanimous support for the intent of the bill and I would be very surprised if there were not unanimous support for the intent of better supporting our least well-off children. It is in the implementation where this Government and this bill fail badly. It is all about the appearance of giving more support to our least well off and it is very very thin on substance.Equally thin is the boast we have heard ad nauseam—if I may borrow that phrase—from our members in the Government about being the first Government in “x” number of years to increase benefits. It is a good thing to increase benefits but such a parsimonious begrudging approach to this—it is a very blaming sort of approach to suggest that the responsibility invariably rests with people in the position of being amongst our least well off. The Greens believe that we need policies that actually contribute to children’s well-being—to put children first in fact.I am reminded that in the 1980s when there was a significant and very interesting debate about the establishment of what eventually became the Ministry for the Environment—there was the proposition that something like the Ministry for the Environment should exist; I think it was referred to as the “Ministry in the Middle”—there was the idea that all Government policy and all proposed legislation should pass through the filter of “Is this going to have positive environmental outcomes?”. As we know unfortunately that is not how the Ministry for the Environment evolved. I do wonder whether it would be valuable if we could apply a similar lens to all legislation going through this House—“Is this going to benefit our children collectively and individually?”. Would that not be a really powerful and useful way to interrogate proposed legislation? Put that lens over it: is it good for our children? Frankly I think that this legislation would at best get a very marginal C minus—it certainly would not be in the B’s or the A’s.One of the provisions that have been talked about is the fact that the point at which work-testing of parents will kick in is when the youngest child is 3 years old. I think that that is an unrealistic blanket application. It is true. Actually I recently spoke just a matter of a day or two ago to a woman who is returning to the workforce. Her children from memory are 4½ and perhaps nearly 3. She is returning to a well-paid professional job. Her husband is in good employment where he has some flexibility. The woman whom I referred to is also coming back on a part-time basis with a degree of flexibility. That is a very happy situation. She is wanting to get back into her career and good on her for doing that. She is assured of high-quality childcare for her kids for the time that she is at work. That will absolutely not be the situation for many of the people with children as young as 3 years old who are forced into this work-testing regime.Children at 3 are still very high needs. I know this. I am blessed to have two 2½-year-old granddaughters and they are in need of constant attention and constant stimulation and—dare I say it—some wrangling. It is a privilege and I enjoy it a great deal as do their parents most of the time. But to impose this 3-year limit on people I think is unreasonable. It borders I think on the inhumane. It does not recognise the reality that some families do not have access to even part-time work that is even modestly well paid.I live in Northland and would not choose to live anywhere else. But a lot of our least well-off families who are dependent for the moment at least on benefits will be seriously disadvantaged by this determination that they must begin looking for work when their children are as young as 3. Access to work itself in an area with still sadly the highest levels of unemployment in New Zealand—physical access transport to work getting there looking after a number of children getting quality childcare for a number of children based on the income you might extract from part-time work in a fairly low-income environment—is simply not the reality. It is not true; it is not going to occur that way. We need to do a great deal better and the Greens in Government will. Kia ora.PEENI HENARE (Labour—Tāmaki Makaurau): Ā tēnā koe e Te Māngai o Te Whare tēnā tātau katoa. Ka tīmata ake ahau i taku kōrero i te ahiahi nei me te kōrero kīwaha o te iwi Māori: “Pai ake tēnei i te kore noa iho!”. I just wanted to preface my contribution this afternoon with a well-known Māori expression: “Oh well I guess this is better than getting nothing!”. It has been well talked about this afternoon that this is really just a drop in the bucket.I want to just touch on the comment made by Mr Muller about how most of the 31 submitters on the Support for Children in Hardship Bill support the intent of it. Well I have sat in this House for just over a year now and I have heard from the other side of the House how good policy is about supporting the outcomes and not the intent. I look across and I wonder: “Well jeez you know—I don’t think they got that one right.” It would also appear that that is the case when I consider the submissions that were made on this particular bill. All of the submitters came in with the belief of my opening comment that well this is actually better than nothing. So we are willing to support it on the basis that at least some of our whānau out there some of our families will get a little bit of something as opposed to getting nothing.Most people in the House have spoken about the impacts it will have on family. I want to talk about just very briefly this juggernaut that is heaving this juggernaut that is slow this juggernaut that is certainly is not a slick machine. I am talking about Work and Income. It is going to be laboured with the job with the task of making decisions—and not only about this particular piece of legislation. It might interest the House that once upon a time in a former life I was a case manager at Work and Income and I do know that the job that those case managers have is already really hard. It is hard not only because they are dealing with our people constantly but also because of the administrative responsibilities that are placed on them by the likes of this particular Government. This bill will add just another task to their everyday job.I think about that job. So you walk into Work and Income you sit down with a case manager and that case manager with that particular client has to work out your eligibility for Housing New Zealand. Who gets to make the call on that? They do. They also have to work out your entitlements for the benefit. Who gets to make the call on that? They do. Now all of a sudden we are saying here that they get to define what it means to go into a job and what kind of job you enter into. So all of this has to be compacted into a half-hour interview—at maximum 45 minutes—with a case manager at Work and Income knowing full well that you have got a large caseload sitting in the waiting room. Most of them will have tamariki with them who will be crying. They do not want to be there. I acknowledge that our people want to be out working. They want to feel empowered. They want to make sure that they are bringing home the bacon for their family. But I do not think this is the way. I do not think this is the way. So I do feel a little bit of aroha for my former colleagues of Work and Income those who actually have to bear the brunt of policies and legislation such as this.This House has mentioned and quoted my grandfather many times: “We’ve come too far not to go further.” and “We’ve done too much not to do more.” There is another one of his that I quite like. It is: “Everyone is equal. However some people are more equal than others.” I think that has been mentioned just a couple of times by our Green colleagues here in the House. When I thought about that particular statement as a young fellow I did not exactly know what that meant at the time. I thought it had something to do with civil rights. Well actually now I have seen how it works. There is a poverty trap in this country and the gap between the haves and the have-nots is growing daily. Members of this House have mentioned the number of tamariki who are caught in poverty. They have mentioned all of our whānau who are out there struggling and sadly this Government cannot see that. So I want to finish on what I started on to close my contribution: “Pai ake tēnei i te kore!” [Better this than zilch!].JONO NAYLOR (National): I just want to if I can take you back to 1972. At that time people were driving around in HQ Holdens. Our family was driving around in our Mark IV Zephyr. It was the year of the Munich Olympics. It was 2 years before those famous Commonwealth Games in Christchurch—for me that was a distant memory I have got to say. For some of my colleagues here I think that Ministers Guy and Lotu-Iiga were probably in nappies. It was the year that my colleague here Mr Doocey was born. That was a long time ago—1972—and yet that was the last time that a Government put up the real amount of benefits for beneficiaries in New Zealand.I have heard people say today we should stop talking about that and that it seems parsimonious. Somebody else was saying that it was a National Government that cut the benefits in another distant memory as well. But in order to do this—in order to this—it takes a certain level of management and over the last little while that we have been in Government it has not been possible necessarily to take this step but we are now in a position where we are seeing a growth in the amount of wages. We are starting to see a bigger gap between wages and benefits. That means that we can actually start to raise these benefits.I am proud to be a part of a Government that is bringing this into place and to hear the negativity around the House today is I think sad because actually today is a day that we are actually doing something very positive to ensure that the vulnerable children in our communities will have a better chance at making it out of that poverty. There has been a lot of criticism to say: “Oh this one thing isn’t going to do it. The Government is just barking up the wrong tree if they think this is going to do it.” But this is not the only thing that this Government is doing to ensure that our vulnerable young children will have better outcomes. There are going to be 750000 Kiwi kids under 13 receiving free doctors visits. Ninety-four percent of 2-year-olds were immunised last year whereas in 2007 a mere 67 percent of them were. We have insulated over a quarter of a million homes as well.This bill is part of an ongoing package. It is part of an ongoing commitment of this Government to ensure that we are lifting people up from poverty; we are living people up into places where they can do better for themselves. I am really proud of what we are doing here. I am proud that we are starting to make some progress. This is a good bill. I wish we did not have so much sour grapes about it but I am so glad that it is going to go through with such strong support and that we are going to see great things for young New Zealanders as we move forward.POTO WILLIAMS (Labour—Christchurch East): I do want to start off on a positive note and say that yes we acknowledge on this side of the House that this bill will provide more money to low-income families. We acknowledge that and this bill is a step in the right direction. But it is almost like taking one step forward and three steps back because in other ways the Government’s policies have really impacted to make our families more vulnerable. But as I say I acknowledge that this bill is a step in the right directionI just want to quote from many many documents including from the general policy statement in the commentary on the bill. It says: “The Government believes all New Zealand families and children should have the opportunity to live fulfilling lives. While most families do well some struggle and their children may face a higher risk of poor outcomes.” To quote my colleague it should be about the outcomes that are delivered at the end of the day not the intent of the bill. We know from the technical report from the Child Poverty Monitor that somewhere in the region of 17 percent of children are in poverty and that about 10 percent of kids—one in 10—are in severe poverty. We know that they are going without the things they need and the low incomes that their families receive mean that they do not have any opportunity to change this. So I want to echo what people have said: this is not just about putting a little bit more money into the pockets of low-income families; it is actually about a systemic complete package and approach to dealing with the issues that these families and these children suffer.This bill looks at changing the definition of part-time work from 15 hours to 20 hours a week. That is going to impact on the ability for mostly our mums to actually find part-time work. I know that from one of the submitters the New Zealand Council of Trade Unions I think—and I have to say that we had a broad range of submitters; they were not from just the usual groups—which told us that there are over 100000 part-time workers currently looking for more hours. So we have put some families under pressure. They are looking for more hours. As people know people want to work and they want to be able to take care of their own families but this is going to impact on the ability of the families that are captured by this bill to actually find sufficient hours of work.We also know that the work test takes effect from when your youngest child is aged 3. I know from the Children’s Commissioner’s report that on average working families generally get back to work when the child is about aged 3. That does not make it right. That does not mean it is in the best interests of children and it does apply extra pressure to families to find the resources to then be able to go out to seek work. Not only is it difficult to find work and not only are they in competition with other part-time workers looking for more hours but they are looking for work when their children are at the age of 3. Generally they will be people who have lower skills and usually they will be in low-paid jobs. The jobs will generally be minimum wage jobs. They could have zero-hour contracts precarious working situations often with shift work. What do we do about childcare when the work that they are offered is actually in the evenings and at inappropriate times so that it is not a good opportunity for a family? That has not been explored in this bill.We talk about work testing parents. I would actually like the Government to be work tested. I think what we should be doing is testing the Government on the appropriateness of doing this. The work-test obligations now extend to spouses and partners. I find it extraordinary that we would require that. As I have said many times people on low incomes have to jump through more and more and more hoops in order just to attract what they need to take care of their families. In fact this bill will give on average somewhere in the region of an extra $22 or $23 a week to families. They may find part-time work which will add to their income but the Government is saying that 20-something dollars to families is adequate. It is important to note that that payment is not per child per family—it is per family. It is important to note that many of the lowest-income families are larger families of two three or four children. So when this payment is per family it means that the effect of that payment is dissipating across the numbers of children.It will have limited effect.I want to quote from some of the submitters. The New ZealandChristian Council of Social Services when we asked it questions said as I have just said that it does not factor in the number of kids in a family and that there is more regulation around emergency benefits and increasing the work obligations without actually offering job training for the Work and Income New Zealand staff who are going to have to make the decisions about the appropriateness of work. Given the concerns that I have about the ability to have appropriate childcare at times that may be difficult for these part-time workers to attain does this mean that sanctions could be applied to these families if the Work and Income caseworker decides that it is appropriate work but actually it is not appropriate for that family? And let us face it: there have been 80000 sanctions in the last 14 months imposed by Work and Income and that has impacted 44000 children. Every time a family is sanctioned it impacts those kids.Let us look at the opportunities for childcare according to the New Zealand Christian Council of Social Services saying that commercial early childhood education providers potentially diminish the quality of care for our children. So not only are we forced potentially into precarious work situations around zero-hours but we are also worried about the quality of care our children are receiving. People are being encouraged to move off benefits but it does not mean that this Government has actually created any work for them to do. I could go on for ages.Let us look at the New Zealand Nurses Organisation. It talks about readmission rates for children from low-income families and how the readmission rate a month after being discharged is much higher with low-income families. So we are talking about a population who are also impacted by mostly the poor living conditions that they have and their children do experience higher levels of engagement with our health services. These families are also indebted to GP practices because parents cannot access health care for their kids. The New Zealand Nurses Organisation was very concerned about dropping the age of work testing to the age of 3 years—when your youngest child is 3.The Council of Trade Unions came up with a statistic that 100000 part-time workers are currently looking for more hours. There is just not enough part-time work in this country to satisfy what is being required in this bill. There was another select committee submission that suggested that in order for beneficiaries to be able to work in paid employment there would need to be much greater availability of inexpensive childcare.I finish where I began. This bill does take us a step in the right direction but there are many many aspects of the system that need to be fixed in order for this to work and for our low-income families to actually have the right opportunities to get ahead. Tēnā koe.Dr PARMJEET PARMAR (National): Thank you for the opportunity to speak on the second reading of the Support for Children in Hardship Bill. Our welfare system the way it works currently is one of the best in the world and I appreciate the system because I was born in one the many countries that does not have this kind of welfare system. I am really keen to see that families are doing well. I am really keen to see that children including in low-income families are able to get the best possible opportunities so they can do well in their lives. Among low-income families more generally if there is a slight increase in expense it creates a huge financial burden on those families. Similarly if there is a slight increase in income that can create a huge positive difference in those families. This bill is about creating that positive difference in low-income families.We all know that staying on benefit is not going to help families get out of poverty. Work is the only step that people need to take—getting into work—to get out of poverty and that is why this National Government has been actively working to get people off benefit and assisting families on benefit to get into work. Since this National Government came in in 2008 we have seen that the number of people on all main benefits is reducing and we are not shifting people from one category to another category like the previous Labour Government did. It just shifted people from the unemployment benefit to the sickness benefit. It just manipulated numbers to make it look good and to make it look like it was doing something for families on benefits. But the numbers we are seeing now—the numbers that are going down—are real numbers and these people are now proudly contributing to our economy and the children in these families are also feeling better because they can thrive in financially independent families. The progress that we are making now will pay off for generations because we are breaking the cycle of welfare dependency.Income is not the only factor for poor outcomes in children because there are several other factors too. I acknowledge that income can be an important factor in outcomes for children and that is why this National Government in Budget 2015 allocated $790 million to help children in low-income families. These changes once the bill goes through will come into effect from 1 April 2016. I hear the Opposition saying that it is not enough but we need to realise the fact that this is the first time since 1972 that beneficiaries are getting a real increment and this just shows that those members do not have any other worthy argument which is why all they have to say is that this is not enough.Finally I want to acknowledge the submitters—those who made submissions. There were 31 submissions during the select committee process and it was a great privilege for me to be part of the Social Services Committee which considered this bill because I know there are so many families out there eagerly looking forward for this bill to go through. It is a great bill and I commend this bill to the House.Bill read a second time.Sittings of the HouseGRANT ROBERTSON (Labour—Wellington Central): I notice that it is fairly close to the end of the sitting day and we will not get through a full speech on the next bill so I seek leave for the House to rise.The ASSISTANT SPEAKER (Hon Trevor Mallard): Is there any objection? There appears to be no objection.The House adjourned at 5.53 p.m.