Industry New Zealand and Trade New Zealand Integration Bill — Second Reading 
Text is incorporated into the Bound Volume 
Industry New Zealand and Trade New Zealand Integration Bill — Second Reading 
[Sitting date: 10 June 2003. Volume:609;Page:6081. Text is incorporated into the Bound Volume.] 
Industry New Zealand and Trade New Zealand Integration Bill 
Second Reading 
Hon JIM ANDERTON (Minister for Economic Development) 
: 
 I move  
That the Industry New Zealand and Trade New Zealand Integration Bill be now read a second time 
. When passed this bill will create a one-stop shop for economic development and trade promotion. We are creating this new organisation to integrate the services currently provided by Trade New Zealand and Industry New Zealand with the aim of making those services as seamless and responsive as possible. The coalition Government decided early in the process of this merger that it had to play a smart and active role in the economy and the work done by Industry New Zealand and the Ministry of Economic Development in our regions in regional partnerships in partnership with business communities local government trade unions with industry sectors with the Maori and Pacific Island peoples is starting to make a real difference. Those of my colleagues who celebrated the innovation day recently and will celebrate later this year our regional development conference and programme know full well how energised the regions of New Zealand are in engaging with a Government that is proactive in the economic development and progress of regional New Zealand. 
This new agency New Zealand Trade and Enterprise establishes a new economic development entity. It brings together Trade New Zealand and Industry New Zealand. The legislation will build on Trade New Zealand’s experience both internationally and in New Zealand’s export sector as well as Industry New Zealand’s experience in working with investors businesses and regions. 
The bill is evidence of a Government that listens to the business community. In many regional development visits that I have made up and down New Zealand I have visited literally hundreds of businesses and met thousands of business people who continually wanted to know why there was not a one-stop shop for business advice. They wanted to see the advice and support they needed for their growth and development and for increased investment and export opportunities all integrated into one service. 
The Wellington chamber of commerce and many other business organisations have called for a one-stop shop for some time. During the election the Progressive Party committed to this one-organisation approach during this term of office and I am pleased to say that the New Zealand Trade and Enterprise entity outlined in this bill delivers on that commitment and I know that my Labour colleagues made a similar commitment. The purpose of New Zealand Trade and Enterprise will be to support the development of internationally competitive New Zealand businesses. This role has been carefully chosen. Recent consultation with business groups on the aims and objectives of New Zealand Trade and Enterprise has shown wide-ranging support for this step towards integration. It provides a strong platform for the partnerships needed to stimulate business innovation and enterprise. Every New Zealand business needs to strive to be internationally competitive regardless of whether it has a domestic focus or is already trading internationally. We clearly need to raise business performance across the whole economy. Various submissions to the select committee on this matter raised issues that had been given careful consideration by both the select committee and the Government. I thank the members of the select committee for the way in which they went about hearing those submissions and deliberating on the bill. 
I hope we receive New Zealand First’s support for this bill. In looking at the origins of Industry New Zealand and the Ministry of Economic Development I note that New Zealand First supported it and I hope it will support this development as well because it is a continuation of what we commenced only 2 to 3 years ago. It is an important new step in the direction of an important entity to serve the business and regional communities of New Zealand. 
New Zealand Trade and Enterprise will support the Government’s commitment to developing our economy through innovation and working with key industries that can drive economic growth. That organisation will deal with businesses across a wide range of areas of business activity in this country. They will include the direct development needs of individual companies and clusters of businesses industry sectors as well as dealing with barriers to growth by developing individual sectoral and regional strategies and through initiatives that improve the business and enterprise culture in New Zealand. 
Hon Tony Ryall 
: This will make the 6 o’clock news. 
Hon JIM ANDERTON 
: The fact that the New Zealand coalition Government of today is taking actions like this gives this Government a permanent place in the political history of New Zealand. Unfortunately the National Party which used to have some kind of substance has been proved to be a hollow shell. 
Hon Tony Ryall 
: It won’t exit in 2 year’s time. 
Hon JIM ANDERTON 
: I doubt whether it will ever be across this side of the House—certainly not in the time the member who is interjecting now will be in this House. 
The decision to merge Trade New Zealand and Industry New Zealand will send a strong message to the business community. The message is that we want it to succeed we want it to do better so that New Zealand can do better. We want to see more innovation stronger businesses and stronger regions all leading to long-term sustainable high-quality employment in this country. I can say to the House that in an extensive visit I made recently to nine countries to have a very close look at industry regional and infrastructural development that is assisting the economies of a number of very progressive countries in the world there were a number of examples of high-quality institutions that received Government support that was integral and critical to the economic development of those countries. When we think that New Zealand turned its back on a positive and proactive partnership between central government local government the business community and local and regional communities in New Zealand for a very long time we realise we have a lot of catching up to do. 
The positive nature of the contribution that institutions like this proposed entity of the Trade New Zealand and Industry New Zealand merger will produce that. The examples of the performance of the economies in Ireland Finland Sweden Denmark and a wide range of European countries were quite remarkable in terms of the way in which the positive proactive role of government had made a significant contribution to the well-being of those societies. It is not a matter of “Government knows best”. It is a matter of the Government being positively involved in a constructive way with the people of each of the countries involved. New Zealand is now having to catch up on 20 to 25 years of neglect. This entity will make a very important contribution to the job we started 2 to 3 years ago. I know that the business community welcomes it. I know that regional New Zealand welcomes this opportunity. I know that this will do a lot to continue the progress and momentum we have gained in the activities we have engaged in through the Ministry of Economic Development and Industry New Zealand and the cooperation we have had with Investment New Zealand and Trade New Zealand. New Zealanders expect nothing less of this House than that we make rapid and constructive progress in passing this bill through the remaining stages so that we can get on with the job from 1 July that we have committed ourselves to do. 
Hon TONY RYALL (NZ National—Bay of Plenty) 
: 
 The National Party in Opposition will be supporting in principle this bill’s continuation. It is a weak and feeble step towards the National Party’s wider policy in respect of industry assistance. In fact about 32 different funds and organisations provide support for innovation and business development in New Zealand and the integration of Industry New Zealand and Trade New Zealand is but a first step. We think that the other 31 organisations need to be rolled in together because too much money is being spent on bureaucracy and all that rigmarole and photo opportunities for the Minister and not enough is going in to provide support in the areas that we need. 
The Minister who has just spoken—I think he used to be the Deputy Prime Minister of New Zealand but his party suffered such a wipe-out in the last general election—wanted to draw members’ attention to the great success of Industry New Zealand. I remind members of what that member has said about his plans for proposals for Industry New Zealand. Members should cast their minds back to 5 February 2001 to a new superyacht development in west Auckland. According to the Government that development was going to deliver hundreds of jobs and up to $600 million in export earnings over the coming years in the $18 million construction facility to be built on surplus defence land at Hobsonville by Sovereign Yachts. It was all about outstanding investment in New Zealand! Mr Anderton said that the downstream benefits of the venture would flow on to the rest of New Zealand. 
But Mr Anderton was not the only person effusive in his support for that taxpayer investment in Sovereign Yachts. The Prime Minister of New Zealand consciously went on to say that that latest investment was just a flagship of the Industry New Zealand programme and an indication of the true commitment of the Government to industry development in New Zealand. That was our Prime Minister. Sovereign Yachts was the flagship of industry development from the Labour-led Government. We now know that it has sacked most of the workforce. The Prime Minister truly has the gift of the gaffe. Time and time again we see the Prime Minister making those ridiculous statements. Here we are: a “flagship of Industry New Zealand”! 
John Carter 
: When did she say that? 
Hon TONY RYALL 
: In February 2001. The National Party is concerned that the Government would bring the bill to the House with no regulatory impact statement at all. The Parliament has absolutely no idea what effect this proposal will have on business compliance costs or regulation nor is there a cost-benefit analysis of the benefits of doing what is proposed in the bill. 
We heard in the previous debate from the junior member for the Hutt Valley about how important it was to consider cost benefit in all this stuff. As a former Minister of Commerce given the push because he could get nothing passed through the parliamentary agenda he was the guy who used to go on about regulatory impact statements and there is not one mention of that here. 
The National Party is concerned also about the over-prescriptive nature of the proposal. I want members to know that rather than saying we are amalgamating those organisations we are empowering them with a go-ahead statement of corporate intent with clear indications about what granting and assistance will be provided we have legislation that sets out that they can have one or more bank accounts. Other legislation states what they can do with their funds. It talks about what is required to execute a document. Sensible professional people are running this organisation yet this Government is giving them a law that tells them about their bank accounts how they will execute documents and it provides about 15 items that need to be included in the statement of corporate intent. No other Crown agency has a page and a half of instructions as to what must be included in its statement of corporate intent. 
Then the bill has half a page on how one actually gets a draft statement of intent from New Zealand Trade and Enterprise through to the Minister’s office and then there is another half page on what the Minister does to put a signature on it and then there is another half page on what to do if there are amendments to the draft statement. I say that if we are to have an industry support organisation it needs to be swift of foot flexible and professional. We simply do not need the overly prescriptive and detailed features that appear in this bill. 
It gets even worse. I would have thought—and Mr Edwin Perry is agreeing with this—that if we were appointing someone to run this new organisation there would be a very clear expectation as to how that person would perform. But what does the Government do? It is so worried about its appointees that clause 6 of the first schedule tells the board and staff that they have a duty to act with honesty and integrity. The Government actually has to put that in the law. Surely there would be an expectation— 
John Carter 
: Parekura would have liked that in Te Mangai Paho would he not? 
Hon TONY RYALL 
: Maybe. Then we have all this stuff about a duty to act with reasonable care diligence and skill. That is required in the law already under expectations of trusteeship or company directorship. This bill is overly prescriptive. It requires directors and management to do a myriad of things which will bog them down in too much paperwork. We on this side of the House want to be supportive of any measure that will reduce unnecessary costs to business because there are problems with the way Industry New Zealand and Trade New Zealand operate. There is simply too much money going into the administration of the grants schemes and the criteria are not appropriate for many people in business. 
For example if a small business wants to get ahead it gets a $15000 grant from Industry New Zealand and Jim Anderton gets his picture in the local paper saying how he has given the business that $15000 grant but what people are not told is that the business cannot get that $15000 until it has generated $15000 of its own money to match what Industry New Zealand is offering. If one is running a small business and trying to get an idea off the ground $15000— 
Hon Harry Duynhoven 
: That is nothing new. It occurred in your Government. 
Hon TONY RYALL 
: I know that that Minister with his salary may not think $15000 is a lot of money but for ordinary people who are trying to get their ideas off the ground and need a bit of support $15000 is a lot of money. The point I am making is that the Government likes to go around saying that it is giving out those grants to everybody but they are not picked up because no one has the matching funds. That is what is wrong with that scheme and the National Party in Government will be changing that. We also want to make sure— 
David Benson-Pope 
: Is that policy at last? 
Hon TONY RYALL 
: We hear “Is that policy at last?” from that member from somewhere down south. Actually this bill was our idea. We were the first to say that we should bring those organisations together but the Government does not have the intestinal fortitude to bring the other 32 grant organisations under the one umbrella as well. If that small business that I was talking about wants to get that $15000 grant there is not only Industry New Zealand and Trade New Zealand but also Technology New Zealand the Foundation for Research Science and Technology the Public Good Science Fund Fast Forward—there is a myriad of funds and organisations that businesspeople have to go to in order to get funds to try to support their ideas. 
The National Party says that that money would be much more effective if we brought it all together under one roof cut out the 30 percent that goes into administration banked those savings or used them for other industry assistance and made sure it worked. What we know works is mentoring support and advice networks. 
This party says that it is important we back the productive sector. The reason we want to back the productive sector is not that we want to own it—unlike this Government which renationalised the Accident Compensation Corporation and bought the airways and is now buying the railways and setting up its own bank. We do not think that is the role for the Government. We think the Government’s role is in providing support. 
Hon PETER DUNNE (Leader—United Future) 
: 
 One of the constant refrains of successive Governments in the two decades that I have been in the House has been the issue of how Governments facilitate industry development both at the domestic and at the international level. We have been through a variety of constructions. We started out with two Government departments the Ministry of Foreign Affairs and Overseas Trade and the Ministry of Trade and Industry. Then we went to the Trade Development Board regional development councils business development boards Trade New Zealand Industry New Zealand and a whole raft of networks. I am not surprised by the figure of 31 or 32 that we may now have of such bodies some working in the domestic economy others seeking to deal with New Zealand’s interests aboard. 
I welcome the Industry New Zealand and Trade New Zealand Integration Bill because it starts a process that people have been grappling with for some time of integrating both our domestic industry assistance programmes with our international obligations and responsibilities towards our exporting sector. I know as someone who has been a Minister in that area in the early 1990s of the constant refrain at that time from the small to medium-sized sector—and I am sure repeated today—that it is all very well for us to be encouraged to develop our domestic production and to be told by Governments and other noble pontificators that we ought to be developing an export industry but that frankly we as small manufacturers do not have the capacity or the contacts to do that; we are too busy doing well the job we know best. 
The focus of a body like Trade New Zealand apart from the big strategic picture has to be very much on providing the opportunities for those manufacturers to get their products on to a world stage. In some cases it will be about arranging appointments and opportunities for the display of products through trade fairs. In other cases it may be something as simple as providing either assistance with an air fare to a trade fair or the ability to put a stand together that displays a product and to give someone a few contacts. 
The point I am making is that the integration that this bill starts to bring about is about ensuring that the small to medium-sized manufacturer or industry that we promote in New Zealand and laud as being desirable and holding the future economic potential of the country has the opportunity with a bit of guided assistance to achieve that potential off shore. I have spoken overseas on a number of occasions to people who want to import New Zealand product but express the concern that they do not know how to access it. In Asia in particular people have asked me why we do not do what the Australians do in terms of marketing our nation and our ability to export and trade with them because they would love to trade with us. In some cases they would prefer to trade with us rather than with the Australians. 
My point is that this integrated approach—New Zealand Trade and Enterprise—has the potential to set us up in such a way that those linkages that people have argued for for some time can at last be made. The detachment and the frustration that the previous speaker alluded to of people who might feel that it is all very well that they are beavering away in their industry creating a product and trying to market it but who ask how do they get it on to a world stage and take advantage of the opportunities may be alleviated. That potential can at last be unlocked and we can at last start to give some confidence to people that these measures can be achieved. 
I see this bill purely in that light. I am not particularly interested in the nuts and bolts of how the board members are appointed or what their accountabilities might be internally—that is standard for legislation of this type—but I am interested in the fact that we are starting to set a potential strategic direction and make some links that will make it possible for those who wish to be part of that to be able to follow it. In that sense having a tighter leaner machine—one body a one-stop shop from the first approach right through to the export end—is a positive move and ought to be supported. 
How many times have we heard the refrain that as a small isolated country we survive by our ability to trade and to export? We all chant that from time to time. The reality of this bill is that it gives that sector some chance and some opportunity to make the links we need and it is a good bill. 
Sitting suspended from 6 p.m. to 7.30 p.m. 
DAIL JONES (NZ First) 
: 
 I am speaking to the Industry New Zealand and Trade New Zealand Integration bill which was the title of the bill before it went to the Commerce Committee which has now recommended that the bill be called the New Zealand Trade and Enterprise Bill. In a way a simple thing like that sums up the Government’s failure in this area. One would have thought that a Government that has had plenty of time to deal with trade in New Zealand would at least get the name of the enterprise correct before sending a bill to the select committee. 
In 2000 New Zealand First supported the preceding legislation in good faith as Peter Brown said on 27 July 2000. Minister Jim Anderton raised the issue when he was speaking earlier and I am pleased to tell him that we will still be supporting this legislation with little confidence in the ability of the Government to give full effect to New Zealand Trade and Enterprise. It failed to give effect to the previous legislation and the clear evidence of that comes in the fact that it needed to introduce this legislation. None the less New Zealand First will still continue to have faith in the whole concept. 
We believe that New Zealand must trade its way in this world. In view of the immense immigration to New Zealand that is taking place along with the money that is being brought into New Zealand by immigrants we are of the view that New Zealand is only just hanging on. This country is failing badly under the poorly acting minority Labour Government in that it is not producing enough goods for sale overseas. We hope that this bill will remedy that situation. 
The bill does not say terribly much as to what this body is going to do. Clause 3 states: “The purpose of this Act is to support the development of internationally competitive New Zealand business by establishing New Zealand Trade and Enterprise.” In subclause (2) it refers to the fact that it is a Crown entity. It is supposed to develop and implement strategies programmes and activities for trade industry and regional development as directed by the Government. It is just a whole bunch of clichés. At one stage the speech of the Minister the Hon Jim Anderton was just a non-stop recurring cliché. This Government really has nothing to offer New Zealand in the way of new ideas for trade. When this bill’s predecessor was introduced in July 2000 the Hon Jim Anderton commented that: “Industry New Zealand will be a special purpose agency with a clear mandate. It will be facilitative it will listen and it will deliver.” Well all it appears to have done in that time is get involved with Sovereign Yachts in Hobsonville and that commercial enterprise has not been a very great success—it has barely been any type of success at all and it certainly has not delivered the amount of jobs that was promised by the Labour Party. 
New Zealand First wants to ensure that we trade our way in the world. Our policy is very clear on the support we would give businesses to ensure that they are able to take advantage of their successes the products they produce and the returns they will bring to New Zealand. On the face of it this bill says nothing at all and when the Minister delivered his speech he really said nothing at all except for a considerable amount of clichés. 
I am pleased that United Future is now supporting this legislation because as we all remember United Future opposed the earlier bill in the year 2000-01 but it has changed its mind. Listening to the speech from Peter Dunne one would not have believed that he actually voted against this legislation in 2000-01. He was full of rapturous applause and support for it today but at that time he opposed the bill. It goes to show that United Future has a strange idea of what common sense is. It was common sense in 2000-01 to vote against this bill but somehow it is now common sense to support a similar type of legislation. It just goes to show how amenable it can be to survival in this House. 
One point that New Zealand First raised in the select committee is recorded in New Zealand First’s minority report: “New Zealand First’s view is that it is not sufficient in developing the Statement of Intent for the new organisation to restrict the input to just the integrating organisations. Tourism and the associated industries represent a significant export sector and as such should be recognised as an integral industry for the purpose of this bill. Tourism and tourism industries have expanded as a result of enterprise and conversely industries have also developed as a result of tourism. Tourism industry should be party to the development of the strategies of the new agency.” 
It is very aptly stated in the minority report that tourism and tourism industries have expanded as a result of enterprise and conversely that industries have also developed as a result of tourism. There should be some acknowledgement in the area of New Zealand trade and enterprise of the support given to trade and enterprise by New Zealand’s successful tourism industry which is based on our natural resources. I was looking at the bill and wondering at its real inadequacies in all respects and I looked at the interpretation clause and at the definition of “borrow”. It seems to me that if the definition of “borrow” includes the financing of lease arrangements—and there needs to be some sort of definition for a lease-type arrangement or a hire purchase agreement—then this rather inadequate legislation should also at some point indicate that this particular board has the right to lease premises. I presume that it will be in some premises; I doubt that it will own those premises and I really wonder at the small degree of thought given to the legislation itself. 
I must congratulate the select committee on the amendment to clause 9(1)(b) which is to “provide a conduit for input and advice from industry” and which includes trade unions local government—which was in the legislation already—regions education and research organisations potential investors and individual enterprises on programmes to implement the Government’s policies for economic industry and regional development. It is important for the trade union movement to be involved in all sectors of the community. 
There is nothing worse than for people to reject any sector of the community on some sort of political basis and New Zealand First will be only too pleased to work with the trade unions the regions education and research organisations and the other areas I have mentioned when we come into Government after the next election. We will be putting forward policies that will ensure that New Zealand’s small businesses big businesses and the like get ample support and recognition for trade and exports overseas. They have always been the cornerstone of New Zealand development and New Zealand First will ensure that they continue to be so in the future. 
GEORGINA BEYER (NZ Labour—Wairarapa) 
: 
 It is a pleasure to take a brief call on this bill. It never hurts to reflect on some of what this bill is about. The objective of the integration of these two particular agencies reflects the need for New Zealand business to be internationally competitive whether markets are domestic or off shore or both. It also recognises that a strong focus on internationalism and on growing New Zealand export earnings is critical to improving New Zealand’s overall economic growth. I commend the bill to the House. 
Hon KEN SHIRLEY (Deputy Leader—ACT NZ) 
: 
 ACT New Zealand will not be supporting this bill which proposes the melding together of Industry New Zealand and Trade New Zealand. I would like to just run through with the House our reasoning behind that position. To start with if we read the commentary from the Commerce Committee right up the front under the heading “Introduction” it makes the point that: “The purpose of the bill and the new agency is to support the development of internationally competitive New Zealand business.” 
At first glance that sounds wonderful a sort of motherhood and apple pie but it is one of the three great lies. We know what that one is. The big one is: “I’m from the Government; I’m here to help you.” When has that ever been true? That has never been true but it just oozes out of this bill. It is nanny State saying “Here I am.” 
Hon Dover Samuels 
: I forgot you used to be a member of the Labour Party. 
Hon KEN SHIRLEY 
: Oh indeed and for the benefit of the member who is interjecting on me I was deeply involved with the formation of the Trade Development Board. In fact I will share something with the member. We had a caucus retreat up in the Waitakeres. Mike Moore was there and so were Jim Sutton myself Ralph Maxwell and Clive Matthewson and that is where the concept of the Trade Development Board came from. That came right through into legislation. Peter Shirtcliffe of course was the first leading light of that body. I would have to say that Peter Shirtcliffe is a remarkable New Zealander a passionate committed New Zealander and he did a sterling job in the early days of the Trade Development Board. I have nothing but praise for the performance of Peter Shirtcliffe. 
Then we had the long tenure with Rick Christie and more recently Fran Wilde. I think philosophically it is debatable whether we actually need a Tradenz. There is something very patronising in saying that our commercial enterprises are not big enough strong enough or powerful enough to foot it out there and the State has to go and hold their hand intercede in the marketplace and oil the path for them. There certainly is a role for Government in combating Government-to-Government issues like tariff barriers and the like. That is a core responsibility of Government but to say that Government has to develop trade is I think a very questionable function for a Government. But I could accept Trade New Zealand. I had questions about it but I could accept it. 
But then what happened under this Government? It developed this new monster Industry New Zealand and the very fact that it now apparently is embarrassed by it and wants to tuck it under something else says it all. Industry New Zealand as we know was Jim Anderton’s little pet baby and he was going to go out there and cultivate industry nationwide combine it with regional development and do marvellous wonderful things around the country. Do members remember all those speeches we used to hear about how he was single-handedly turning round the Southland economy? Industry New Zealand and Jim Anderton were turning round the Southland economy—and we know that was absolute rubbish. It had nothing whatsoever to do with the Government. It was all those big dairy conversions and all that investment into Southland and those great commodity prices coupled with good climatic conditions that generated that wealth into provincial New Zealand. 
Of course that is all changing now and provincial New Zealand is starting to hurt. We are not hearing so much now about these wondrous things that Industry New Zealand is capable of. 
Hon Maurice Williamson 
: Like Sovereign Yachts. 
Hon KEN SHIRLEY 
: Indeed and I will come on to Sovereign Yachts. I was going to call it his flagship. His flagship was Sovereign Yachts and Mr Jones of New Zealand First marvelled at that too. There were all those wonderful speeches about what Sovereign Yachts was going to do and about the 400 jobs. It is a very sad story. But it is even sadder when we realise that it was spending taxpayers’ money to do that and virtually just throwing it away. My fear and ACT’s fear is that Trade New Zealand may arguably have a function—I think it is questionable—but Industry New Zealand clearly does not have a function and to say that we will now pollute the function of Trade New Zealand with this opposed culture of Industry New Zealand is very worrying indeed. 
When we go through the bill there are some extraordinary things. We are now going to call the entity New Zealand Trade and Enterprise. 
Hon Maurice Williamson 
: That will fix it. 
Hon KEN SHIRLEY 
: Oh yes that will fix it with the stroke of a pen. Again in the commentary there are some other revealing things that clearly reflect the mentality the thinking the psyche and the rhetoric of this Labour Government. Right up front there now is the inclusion of trade unions representatives and relevant stakeholders. It does not mention the commercial trade and enterprise of New Zealand who are wealth creators. Right up front is the inclusion of trade unions representatives and other relevant stakeholders. Does that not speak volumes on what this bill is all about? The observation in the commentary that: “The current wording of the bill clause 9(1) does not mention trade unions in the listed organisations that New Zealand Trade and Enterprise will foster …” so therefore we have decided to insert into clause 9(1)(a)(?) and (b) the words “trade unions”. What on earth does that contribute to the trading nation of New Zealand? This is absolute Labour Party à la 1950 rhetoric nothing more and nothing less. 
ACT is deeply concerned about these conflicting cultures that will be melded together and my fear is that the good work that the New Zealand Trade Development Board has done will be polluted and destroyed by this conflicting culture that we have with Industry New Zealand. In its very short time—and it has been in existence a very short time—it has been nothing but a handout organisation. It has rushed around the country with chequebooks offering countless hundreds of thousands of dollars to anybody who could spend it. There are a lot of disgraceful stories still to come out from that and the flagship as we all know was Sovereign Yachts. 
There are some other rather interesting things in the bill. I would like someone on the Government benches to explain this: if we turn to clause 31 we see the personnel policy for this body and what do we have there? We have the “good employer”. People must be good employers. There are some laudable things here: “good and safe working conditions” which is fair enough and “an equal employment opportunities programme” which yes is fair enough. But then we come on to “recognition of the aims and aspirations and the cultural differences of ethnic and minority groups”. That is possibly fair enough in a general sense but let me come on to this dual law stuff again: the recognition of the aims and aspirations of Maori the employment requirements of Maori and the need for involvement of Maori as employees. What patronising pap. I reckon that Maoridom in New Zealand must cringe when it sees that sort of stuff legislated here today. It is virtually implying that Maori are not ordinary members of society and cannot find jobs on their own achievement—and I know they can. 
To be putting that sort of pap into legislation is patronising and offensive and here we see this Labour Party again running those sorts of lies. 
MARK PECK (NZ Labour—Invercargill) 
: 
 I was not going to take a call but I heard a couple of contributions that somewhat worried me. One was from Mr Dail Jones who went on about the New Zealand First minority report. I challenge Mr Jones to read the report. One of the things he will see— 
Dail Jones 
: I read it in the House. 
MARK PECK 
: He says he read the report. Let me tell members that the only person on the Commerce Committee who asked any questions was Rod Donald. He was the only one. Everybody else just nodded away in agreement as we went through. It took us 22 minutes to hear the submissions and the hour and a bit that we took to do the consideration was basically Rod Donald asking questions about tourism. Dail Jones’ party missed the bus. Furthermore— 
Dail Jones 
: We did tourism. 
MARK PECK 
: He interjects again. What does one say? Here we have a man who does not even know what is in the bill trying to make some sense of it. At least Mr Shirley took the opportunity to read it but can I tell him that his member was a little silent at the select committee as well. 
It is a good bill. I do want to acknowledge Mr Jones’ congratulations to the committee on the work it has done. I think we probably did a very good job. Can I also congratulate Rod Donald on turning up and asking the questions. 
ROD DONALD (Co-Leader—Green) 
: 
 I hope Mr Peck will still congratulate me after my speech because in our view this bill has turned Parliament into a farce and is an insult to the democratic process. That is because the Government has not only decided it wants to merge Industry New Zealand with Trade New Zealand but it has already put the structure in place and merely expects this Parliament to rubber-stamp what it has done. 
The Government announced the merger in November last year yet this bill received its first reading only on 25 March 7 days after a letter was sent out from the chair of the establishment board of the new organisation announcing its name New Zealand Trade and Enterprise announcing the departure of the chief executive of Industry New Zealand on 27 March and announcing that the appointment of the chief executive of the new body would take effect on 7 April. 
In other words the new chief executive of the new organisation started his job before the Commerce Committee had even heard submissions on the bill to set up the new organisation let alone report back to Parliament. That has got to be a very very poor process. 
Before agreeing to the merger Parliament should have been allowed to assess thoroughly the benefits of merging those two organisations. Instead the Government set a 1-month report-back date thus denying the select committee the chance to scrutinise whether the new engine room of the Government’s growth strategy is capable of delivering what the Government wants let alone what the Greens think it should be delivering. 
But appalling process in itself is not sufficient reason to oppose this bill. The Green Party does not support this merger. In fact it looks more like a takeover of Industry New Zealand by Trade New Zealand—not the other way round as Mr Shirley indicates. We oppose this merger on substantive grounds. That does not mean we oppose in principle the creation of a combined organisation to provide assistance and support to industry enterprise and business initiative. If we were confident of the outcome of this merger we would support such a move but we cannot vote for this bill in the form in which it has been reported back. That is because the Green Party believes that the purpose of this bill should be to support the development of New Zealand businesses that are not only internationally competitive but also ecologically and socially sustainable. 
The bill provided the opportunity for the Government to give effect to its sustainable development programme of action and in particular to the principles of policy and decision making that include the statement: “Sustainable development must be at the core of all Government policy.” During the committee’s consideration of the bill this member did seek to replace the words “sustainable economic growth” and as Mr Peck said that became the main topic of conversation. We sought to replace the words “sustainable economic growth” in the functions clause with the words “sustainable development” in order to give the Government the chance to live up to its own rhetoric. It refused to make that change because clearly this Government is not willing to walk the talk. Yes the committee did change “sustainable economic growth” to “sustainable economic development” but these words do not mean the same as sustainable development. They clearly imply that economic interests take precedence over social and environmental ones rather than acknowledge that both the economy and our society depend on protecting and restoring the natural environment. The Government’s economic strategy is a house of cards built on sand if it does anything less. 
The adoption of sustainable development would have sent a consistent message that the Government is encouraging industry to reach higher environmental standards and take account of social needs and goals. The need for sustainability to be at the core of Government’s partnership with the business community could also have been addressed by either incorporating a set of sustainability principles in the bill as found in the Energy Efficiency and Conservation Act or by requiring the new entity to take a sustainable development approach in its statement of purpose as found in and required by the Local Government Act. In both cases those implementing the Acts would have been required to take into account the health and safety of people in communities their social economic and cultural well-being the need to maintain and enhance the quality of the environment and the reasonable foreseeable needs of future generations. 
I ask Mr Peck why the Government does not want to do that. What is it scared of? Clearly it thinks it is a good idea for the local government sector to take a sustainable development approach to all its activities. Clearly it thinks it is a good idea for the Energy Efficiency and Conservation Act to practise sustainability but for reasons that escape me the Government is not prepared to commit to assisting and supporting only those businesses that operate in an environmentally and socially sustainable way. 
The Government is very happy to say the right things. Industry New Zealand even produced a special issue of its magazine on sustainable development. The rhetoric was great: “Sustainable growth has become a catchcry but the wider goal of sustainable development is the more important target.” The content was compelling. “New Zealand’s population rose by 19 percent in the last 20 years but in the same period we used 61 percent more energy registered 67 percent more cars and in Auckland threw out 162 percent more rubbish.” It went on to state: “Many New Zealand companies are still in denial over the need for sustainability.” 
The solutions are obvious. They are in this article: “Triple bottom line reporting is based on the idea that companies do not work in a vacuum but are part of the society they operate in. To concentrate on economic performance alone is to ignore the impact of the company’s activities on the environment and on the community—the sort of thinking that may lead to environmental destruction and social breakdown.” 
It is all there yet the Government refuses to make sustainability a bottom line for New Zealand Trade and Enterprise. Well we intend to try to change that during the Committee stage and that I am afraid is because we have no confidence that New Zealand Trade and Enterprise will implement the Government’s own sustainable development plan of action unless it is forced to. 
Why are we so uncharitable? Because when Industry New Zealand was formed we tried to engage with the Government on sustainability issues and we got fobbed off. We accept that our goals for the economy are radically different from those of the establishment parties but we were prepared to meet Labour in the middle. That is because it makes good sense for the Government to ensure that industries reduce their overall environmental impacts by living within our natural income rather than depleting our natural capital and by improving output while reducing resource throughput. 
It makes good sense to give explicit directions to industry including agriculture to shift to cleaner production methods to shift from more toxic to less-toxic production methods and products and to address waste management in a meaningful way. It makes sense to understand and seek to enhance the ecological systems on which much production—indeed all life—depends but apparently it did not make good sense to the last Labour-led Government so why should we trust this one notwithstanding its sustainable development action plan. 
If this body is the Government’s economic engine room it must embrace sustainable development otherwise we cannot support this bill and we will be doing our best in the Committee stage to make amendments to it so that indeed we can support it. They include a move to import substitution rather than the fixation with export-led growth that this bill entrenches because it is unbalanced. It is trying to fly on one wing by talking only about the export sector and by not addressing the need for import substitution. Yet the evidence is clear that Industry New Zealand and Trade New Zealand are not delivering the right outcomes and we need a Buy New Zealand Made policy to correct that. 
JILL PETTIS (NZ Labour—Whanganui) 
: 
 I am pleased to support this bill. The integration of Industry New Zealand and Trade New Zealand will be very good for provincial New Zealand. Excellent services have been provided by Industry New Zealand since this Government has been in power and I look forward to even more involvement in promoting industry in provincial New Zealand as a consequence of this bill. I am pleased to support it. 
JOHN CARTER (NZ National—Northland) 
: 
 The National Party supports the concept of amalgamating Industry New Zealand and Trade New Zealand. We made that clear at the very beginning when we had the bill’s first reading and during the select committee process. However having said that there are a number of issues that disappoint the National Party and I am going to spend the next 9½ minutes talking not just in relation to this bill but in telling the House why the National Party is unhappy with what the Government is doing with this legislation. 
The first thing is that while it is fine that the Government is looking to combine the two agencies—indeed it has taken National Party policy and is now implementing it; we are pleased to see that—it is the practical aspects that worry the National caucus as I know they worry the ACT party and the New Zealand First Party. The practicalities of what the Government is doing with supporting industry in New Zealand worry the National Party. 
 The National Party agrees with the concept of the one-stop shop. We have no problem about that. A little later I will talk about some of the things it should be doing but we agree there should be a one-stop shop instead of not just those agencies but the country will be surprised to know that there are 32 different Government departments that deliver support to try to encourage development. We have 32 different Government authorities delivering support for industry. What a nonsense! Why do we need that much bureaucracy in this country? People are absolutely astounded when they hear that there is not just one not just two not just half a dozen but 32 such departments. Yet this Government is now going around saying that this amalgamation is great that it is fantastic because out of those 32 it has brought two together. What about the other 30? 
Brian Connell 
: Can we fix it? 
JOHN CARTER 
: Can we fix it? Of course we can. The first disappointing thing about this legislation is that it does not go far enough. I know there are members opposite including the Minister of Finance who would much rather see us get away from all this bureaucracy and put the 32 organisations into one and deliver good services to industry in the country. That is the first thing. 
Hon Dover Samuels 
: Kia ora that’s the one. 
JOHN CARTER 
: I know that the member for Te Tai Tokerau agrees. We have discussed this on a number of occasions. He would like to see a whole lot more brought together in one bundle. 
The second point is that combining Industry New Zealand and Trade New Zealand does not necessarily mean that it will be a success. Indeed one of the things we need to ask as we are discussing this—and we will certainly explore this more while going through the Committee stage—is where are the successes? Where are the successes from what Mr Jim Anderton has done with regard to his portfolio in this area? 
Hon Ken Shirley 
: Name one. 
JOHN CARTER 
: There may be one or two. Let us be fair: there may be some successes and maybe Mr Anderton will come and tell us— 
Brian Connell 
: Name five! 
JOHN CARTER 
: I am sorry but I cannot because in my whole exploration in this area as a spokesman—and along with my associate my friend Brian Connell we have explored it widely—I have not come up with anybody who says: “This has been helpful to our business and has taken us right through. The business is making a million dollars or a hundred thousand dollars for the country and we’re doing well.” There may be some. So let us be generous to the Government and to Jim Anderton. He may well tell us about that during the Committee stage. 
I do know of people who have not succeeded and that is the point I want to explore. While we are putting these two organisations together—sadly we are not loading the other 30 in—we should be looking at what we are trying to do. We are trying to promote business. We are trying to encourage people who have good ideas to get on their feet and get going. This is where the Government fails with what it is doing. It relies too much on bureaucracy and not enough on the practical aspects of supporting small businesses—people with good ideas—to get on their feet. I say that we either make a decision that we are going to do it or we get out. We should not start somebody off then leave that person stranded halfway. Sadly that is what happens now. 
I have come across people as I know my friend and colleague Brian Connell has on many occasions who have gone to Industry New Zealand or Trade New Zealand and said: “I want to put this idea forward. Can you give us some support?”. They go through the whole procedure of applications; it takes them a number of months to go through it as they have to fill out a whole lot of forms a whole lot of bureaucrats come and look at them they fiddle around with it and finally it gets signed off: “Yep away you go. We’ll give $15000 $50000 or $100000 to get on with the job and start your idea off.” Those people think: “Great we’re on our way. Here we go.” 
So they get a grant for 12 months. It gets them started they get going they are enthusiastic things are starting to go right but a business does not always get on its feet in 12 months. It actually takes a bit longer. Indeed it can sometimes take 4 or 5 years to get a business successfully launched and on its way. So after 12 months they are told to come back and apply again. So away they go. They go through the whole procedure again. But this time they are a bit broke they are struggling for money they have mortgaged their homes they have borrowed some money off their family and what happens is they are in there with a whole suite of other people and the Minister for Industry and Regional Development says: “No no. You’ve already had a shot. We’re not doing it again. We’ve given you a start. That’s enough; too bad.” So they fail and I think that is most unfortunate. 
I bring to the attention of the House one organisation that I think is a success and that is the Methodist Employment Generation Fund. I have been to see them and I recommend to others that they go and have a look at that concept. 
Hon Ken Shirley 
: Is it a Government department? 
JOHN CARTER 
: No it is not a Government body at all. It is a private organisation that helps small businesses get on their feet. What it does is start those businesses off and it stays with them. It helps them through and gets them going until they are successful and making money then the funds are returned and it reinvests. That is what this Government should be doing with taxpayers’ money. It should be making sure it stays with a business all the way through until it is on its feet. Occasionally there will be a failure. If it is going to do it— 
Hon Ken Shirley 
: No no. 
JOHN CARTER 
: OK we have a philosophical thing going on here. The member Ken Shirley and I would have a debate about whether one should get involved or not at all. But if one does get involved with people then for goodness’ sake they should not be left stranded. We should stay with them make sure they are successful get them on their feet get them going let them earn some money for the country and for themselves let them employ people and let them create industry which is what we are talking about. Then when they have got going they will repay the taxpayers’ money—not just the initial grant but also significant taxes—and certainly supply opportunities for people in this country. 
In other words if we are going to do it from time to time we should pick winners. I know that is not something that this Government likes to do and that it is not something that the far right likes to do either but if we are going to do it we should do it properly and stay with it. We should make sure that we do what the Methodist Employment Generation Fund does and stay with people until they are successful. That is what this bill should be all about. I am afraid that it will not achieve what it should be doing. 
Hon Dr MICHAEL CULLEN (Deputy Prime Minister) 
: 
 I am delighted to support this bill. It is all very well for the senior Opposition whip to whinge away like he did about how terrible life is. That is what he does in public but if one rings him up on his cellphone what does one hear? “Things just keep getting better” is the message on John Carter’s cellphone if one rings it up. He knows how well things are going under this Government. 
He wanted to know of a company that was helped by Industry New Zealand. A couple of weeks ago he was sitting there in his electorate next to Dover Samuels handing out the awards to Living Nature. Living Nature was built from nothing to 80 employees in Kerikeri with the help of the Government. John Carter is right; things just keep getting better. 
BRIAN CONNELL (NZ National—Rakaia) 
: 
 I thank the House for the opportunity to make a contribution on the second reading of the Industry New Zealand and Trade New Zealand Integration Bill. 
Mark Peck 
: Do you think things just keep getting better? 
BRIAN CONNELL 
: They will get better now. Mr Peck should listen and learn. This is a logical merger of two organisations and accordingly National supports it. The theory of it is pretty good. What we should get is economies of scale less bureaucracy fewer compliance costs and more focus. 
Hon Ken Shirley 
: It never works. It’s just a bigger department. 
BRIAN CONNELL 
: The trouble is that it will not happen as Mr Shirley has already pointed out. All that is happening here is that we are taking in a sum of parts and putting them together as one super-bloated bureaucratic Government mouthpiece. 
Hon Dr Michael Cullen 
: Do you support it? 
BRIAN CONNELL 
: I have already said that if the Minister had listened. Dr Cullen should listen and learn. Typical of anything that Mr Anderton tries to champion—and yes members can read Jim Anderton and Sovereign Yachts in brackets—this merger lacks focus and any type of cost-benefit analysis on which to underpin his decision. The Government does not even know why it is doing it. Jim Anderton has made some very vague claims along the lines of it being “a response to calls from business and other stakeholders for a single economic and trade development agency.” 
 I did a little bit of research and came across a very interesting commentary in the  
Independent  
of 22 January 2003. I will quote some of this commentary for the benefit of the people opposite: “Meat Industry Association chief executive Brian Lynch complained: ‘We have not been made aware of any cost-benefit analysis underpinning and supporting the decision. Moreover several major business organisations say they were not consulted about the Government’s plans.’ ” Maybe that is wrong; maybe Jim Anderton is suffering from the same problem that the Prime Minister has—a form of unconsciousness. I thought Mr Anderton said about an hour ago that he had consulted widely with business organisations across the country. But I found out that he had not consulted. 
The Business Roundtable said he had not spoken to them. They had not been consulted since the announcement about the structure and the services that the new agency would provide. The president of the Wellington chamber of commerce Barrie Saunders said just a week before stepping down from the job: “Not me—at least not formally”. He said his organisation had not been formally consulted since the merger had been announced. Export New Zealand vice-president David Binning said he was not consulted formally although he was aware of the direction being taken. Alasdair Thompson Chief Executive of the Northern Employers and Manufacturers Association which represents something like 7000 business units said: “I knew about the planned merger only through the grapevine as an open secret.” He said the association did not know of anyone who had been consulted. Yet the Minister said he had consulted widely. The Chief Executive of the Canterbury Manufacturers Association John Walley said his organisation was not consulted before the Government’s announcement either. 
The powers that be are not interested in listening to what might be required by those on the ground. People who have never been in business—and that means Dr Cullen—want to tell those who have what is best. If the Government had consulted those business organisations it would have found widespread doubts about the merger. 
I do not see any evidence that the new entity will act as a defender of the business sector—none at all. I fear that it will continue to serve as the mouthpiece for the Minister in question. If I can put it bluntly the new entity will be the puppet and the Minister will supply the fist. Given the Minister’s outstanding track record in Sovereign Yachts and the like I am sure some colleagues on this side of the House have absolutely no confidence in him. Business must be free of arbitrary Government interference driven by political considerations. This Government’s view of business as a giant pocket from which it can continually trawl for money must stop. 
Let us look at Industry New Zealand and examine exactly what it has done for regional development. Have compliance costs for businesses gone up or down? 
Lindsay Tisch 
: Up. 
BRIAN CONNELL 
: By how much? Can the member hazard a guess? 
Lindsay Tisch 
: Hugely. 
BRIAN CONNELL 
: It has gone up by about $43000 in the last 12 months. What did Industry New Zealand say about that? It said absolutely nothing. Has it done anything to ensure that regional businesses have a guaranteed and affordable supply of electricity other than standing by and watching this Government sneak in another tax? No it has done absolutely nothing. What has it done to influence the Government to decongest Auckland’s roading problems? 
Lindsay Tisch 
: Nothing. 
BRIAN CONNELL 
: How much of the petrol tax has gone towards roading projects and how much has gone into the consolidated account? It is not hard for a Government to announce a surplus when it does not spend any money; when all it does is tax people. What has the Government said about the sneaky little accident compensation petrol tax that will be slapped on to hard-working Kiwis in the next few weeks? We have heard not a whisper. What has the Government said about the Resource Management Act which is the real handbrake on growth across regional New Zealand? Not a whisper nothing. 
What has Mr Anderton done to try to harness excess water for irrigation across Canterbury Marlborough and Otago? He has done absolutely nothing. He does not understand that water is the lifeblood of most of the regional economies around New Zealand and that it makes a significant contribution nationally. Translated very slowly for Dr Cullen and Co. it means lots of jobs and lots of export dollars. I will say this slowly so that Dr Cullen Minister of Finance will understand it. Regional development is not about little piddling handouts; it is not about picking losers like Sovereign Yachts. Regional development is about creating wealth so that we can all share it. 
According to Mr Anderton it was the aim of Industry New Zealand to lift New Zealand’s growth rate fast enough for us to catch up with Australia—to stop the relative economic decline of New Zealand compared with Australia. Where happened to that aim? The Government has abandoned its attempt to get this country into the top half of the OECD. 
Members should listen to this little gem from Industry New Zealand spokeswoman Debbie Gee: “We are a business dating agency. We hook up people and find business the smoothest route through paperwork and red tape.” Someone should tell her that business wants less red tape not a pathway through it? 
A party vote was called for on the question  
That the Industry New Zealand and Trade New Zealand Integration Bill be now read a second time. 
Ayes 100 
Labour 52; New Zealand National 27; New Zealand First 13; United Future 8. 
Noes 16 
ACT New Zealand 7; Green Party 9. 
Bill read a second time. 
Name changed to New Zealand Trade and Enterprise Bill





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