Volume 643 Week 61 - Thursday 15 November 2007 
Volume 643 Week 61 - Thursday 15 November 2007 
[Volume:643;Page:13145] 
Thursday 15 November 2007 
Madam Speaker 
 took the Chair at 2 p.m. 
Prayers 
. 
Business Statement 
Hon Dr MICHAEL CULLEN (Leader of the House) 
: 
 Next week in the House priority will be given to the third reading of the Appropriation (Continuation of Interim Meaning of Funding for Parliamentary Purposes) Bill all stages of the Subordinate Legislation (Confirmation and Validation) Bill (No 3) the remaining stages of the Building Amendment Bill and the Education (Tertiary Reforms) Amendment Bill and on Thursday probably the second reading of the Electoral Finance Bill. Wednesday of course is a members’ day. 
Questions to Ministers 
Public Service—Appointment Process 
1. GERRY BROWNLEE (National—Ilam) 
 to the  
Minister of State Services 
: Does the view expressed by the Minister of Agriculture that “the person who is in a vulnerable position will always have the bone pointed at them” indicate the Government’s thinking on the appointment process for senior positions in the Public Service? 
Hon DAVID PARKER (Minister of State Services) 
: 
 Mr Anderton did nothing wrong. His comments were appropriate and showed the maturity and consideration that comes from his long experience. 
Gerry Brownlee 
: Does he agree with the statement made by the Hon Jim Anderton to the Hunn review that in his view the role of communications advisers has developed to be very different from what it used to be because it increasingly involves communications strategy and sometimes highly political strategy; and can he explain exactly why the State sector has become involved in highly political strategy? 
Hon DAVID PARKER 
: The very nature of politics is political. 
Hon Dr Nick Smith 
: So the State sector is a division of the Labour Party? 
Gerry Brownlee 
: That is about the size of it. Has the Minister seen the quote of the acting communications manager in the Ministry of Agriculture and Forestry which states: “Madeleine has been upfront about her relationship which in my view should pose no obstacle to her being able to take up the contract position I am offering. However I am aware of some of the political sensitivities that may be present around this appointment and would ask should you think it appropriate you to raise this possible appointment with the Minister.”; and why does he think that the Ministry of Agriculture and Forestry felt so obliged to defer to the Minister on this particular employment issue? 
Hon DAVID PARKER 
: The inquiry makes it clear that the chief executive did not defer to the Minister. 
Gerry Brownlee 
: Then why did he ask the Minister whether it was OK to appoint her? 
Hon DAVID PARKER 
: He did not say that. Further criticisms are made by the reports that are soft criticisms of the chief executive of the Ministry of Agriculture and Forestry— 
Hon Dr Michael Cullen 
: That well-known socialist. 
Hon DAVID PARKER 
: —“That well-known socialist.” as Dr Cullen said somewhat parenthetically—because although things were not perfect at the Ministry of Agriculture and Forestry they were not actually bad there. 
Gerry Brownlee 
: Why did the State Services Commissioner have to tell Hugh Logan that increased emphasis on the environmental policy was not the same as close political management of the Minister’s political position and does the fact that Mr Logan failed to listen not indicate that Mr Prebble lacks the authority to rebuild and restore the political neutrality of the Public Service? 
Hon DAVID PARKER 
: The inquiry speaks for itself in respect of that. I think the point that the inquiry makes and that we certainly agree with on this side of the House is that all people should be employed on their merits. They should be dealt with on their merits and that was the whole point of this inquiry. The inquiry showed that Madeleine Setchell had not been dealt with fairly. 
Hon Dr Michael Cullen 
: In the light of references to political appointments under this Government can the Minister confirm that the Deputy State Services Commissioner Iain Rennie—appointed by this Government and supported by this Government—is a former senior member of the National research unit? 
Hon DAVID PARKER 
: I can indeed and that is to speak no ill of him at all. He is a well-regarded public servant; he was appointed on his merits. 
Gerry Brownlee 
: Why does the Minister continue to express confidence in Dr Prebble when it is clear from the evidence in the Hunn report that the Public Service under his watch has been heavily politicised? 
Hon DAVID PARKER 
: Because it has not. 
Dr Pita Sharples 
: Tena koe Madam Speaker. Tena tatou katoa. What explanation can the Minister provide for the finding in the State Services Commission’s career progression and development survey that more Maori at 24 percent than non-Maori at 17 percent were likely to report they had been deterred from applying for a senior role because they perceived the selection process to be unfair? 
Madam SPEAKER 
: That is very wide of the original question but the Minister may wish to make a comment. 
Hon DAVID PARKER 
: No I do not. I raise a point of order Madam Speaker. I do not think that was within the realms of the substantive question. 
Madam SPEAKER 
: That is correct. The question was quite focused in its intent. 
Fonterra—Future Capital Structure 
2.  
R DOUG WOOLERTON (NZ First) 
 to the  
Minister of Agriculture 
: What conversations has he had with Fonterra’s board of directors regarding options for its future capital structure and which of the options put forward would he favour as Minister of Agriculture? 
Hon Dr MICHAEL CULLEN (Leader of the House) 
 on behalf of the  
Minister of Agriculture 
: The Minister has had a series of conversations with representatives of the board over the last year or so as Fonterra has considered its capital structure. These discussions have focused on the national interest. Fonterra’s board has put one preferred option to its shareholders. It is now up to the shareholders to decide whether the company will progress that option. The Minister has indicated that the Government is prepared to advance legislation in Parliament so that should the proposal be approved by shareholders their decision can be implemented. 
R Doug Woolerton 
: Was debt financing discussed as an option for raising capital given that full ownership of the company would remain in the hands of New Zealand farmers under such an option; if so what was the Minister’s attitude towards that option? 
Hon Dr MICHAEL CULLEN 
: I cannot recall whether that specific option was discussed but I think it would be fair to say that because of the cooperative nature of Fonterra as a structure at the present time there are quite severe limits on the ability to debt finance expansion within the company. 
Sue Kedgley 
: Could the Minister explain how it would be in the national interest to open up the cooperative to foreign investors to allow up to 50 percent of shares to be held by offshore owners and to allow those dividends to flow straight out of New Zealand? 
Hon Dr MICHAEL CULLEN 
: The view taken by Fonterra is that it has very large expansion plans and it aims to maintain and enhance its position as one of the world’s major players in traded dairy products. To engage in that expansion Fonterra needs significant access to capital. The current cooperative—an entirely New Zealand - based operation in that respect—is not able to access that kind of capital and therefore it needs to look at ways in which that capital can be raised. However of course the current proposal put forward by Fonterra includes limits on foreign ownerships and protection of the level of ownership by the farmers’ cooperative which in effect would give it a controlling interest in the new organisation. 
R Doug Woolerton 
: Is the Minister’s statement today that the Government is prepared to advance legislation in Parliament to implement any decision of Fonterra’s shareholders an indication that a partially foreign-owned Fonterra’s largely monopoly position would be under threat; if not why not? 
Hon Dr MICHAEL CULLEN 
: No it is simply to state that if the shareholders who are the people who own Fonterra decide that they want to change the current structure then because that structure is set by legislation it is appropriate for Parliament to consider that legislation. Of course at the end of the day it will be a matter for Parliament to decide whether to approve any such legislation that may come forward. 
R Doug Woolerton 
: Was any consideration given by the Government on the potential effect on New Zealand’s balance of payments of the partial foreign ownership of Fonterra; if not why not? 
Hon Dr MICHAEL CULLEN 
: As I indicated in my first answer the Government’s primary concern is around the national interest. That includes ensuring that New Zealand retains majority ownership that the farmers’ cooperative retains effective control that the headquarters remains within New Zealand that the primary listing of any such company remains within New Zealand and indeed from the Government perspective that the development of products research and development and the like takes place overwhelmingly within New Zealand. If Fonterra expands in that respect and if it significantly expands its offshore earnings that of course is a factor that also has to be taken account of in the balance of payments. 
R Doug Woolerton 
: Does the Minister share the concerns expressed by the Dairy Workers Union that the new structure will create pressure on Fonterra to undertake further commercial activities offshore that can be efficiently undertaken in this country; if not why not? 
Hon Dr MICHAEL CULLEN 
: Obviously there are issues around that but in looking out over the long term as there is a large expansion of world dairy consumption we see that the issue facing Fonterra is whether it positions itself to remain in effect the largest player in terms of traded dairy products around the world. It is in New Zealand’s national interest that that is so but it is in New Zealand’s national interest that Fonterra in achieving that does not become in effect a foreign company. 
R Doug Woolerton 
: Is the Minister concerned at today’s admission by Fonterra’s chairman that the new structure will create tension between what farmers want and what shareholders want; and given that a publicly listed company is beholden solely to increased returns for the shareholders how can the wishes of the farmers be addressed when a proportion of a company that they own decreases over time? 
Hon Dr MICHAEL CULLEN 
: My understanding is that the proposed structure will in effect ensure that the farmers’ cooperative retains effective control of the company. With a single shareholding of 35 percent and with limits on any foreign shareholding well below that level the cooperative retains in effect the effective control of the company. At the end of the day of course the first hurdle the board has to clear is to persuade its farmer shareholders that it is in their interests that this proposal proceeds. I have no doubt that that will be quite a large ask. 
Electoral Finance Bill—Participation in Parliamentary Democracy 
3.  
Hon TONY RYALL (National—Bay of Plenty) 
 to the  
Minister of Justice 
: Does she agree with the statement of her predecessor that the Electoral Finance Bill “will help promote participation in parliamentary democracy”? 
Hon PETE HODGSON (Minister for Economic Development) 
on behalf of the  
Minister of Justice 
: Yes. A good parliamentary democracy is characterised by freedom of speech on the one hand and on the other hand by constraints on individuals or groups who seek to unduly influence a democratic outcome through the raw use of a lot of money. 
Hon Tony Ryall 
: When this bill will form part of New Zealand’s constitutional framework why is the Government continuing to withhold every single report that Ministry of Justice officials have written on the electoral finance issue; and is it not the case that if these reports were full of glowing praise for this bill the Minister would have released every single page in a shot? 
Hon PETE HODGSON 
: My understanding is that the Ministry of Justice is the adviser to the select committee and has provided the select committee with the wide range of reports that are available to the select committee. The select committee comprises a number of people not including the Minister. 
Lynne Pillay 
: What specifically does the Electoral Finance Bill do to constrain those who would seek to unduly influence a democratic outcome through the raw use of a lot of money? 
Hon PETE HODGSON 
: The bill as introduced has a range of limitations on both the funding of special-interest group campaigning and the expenditure of special-interest group campaigning. The select committee soon will report any changes to the House. The purpose of these limitations is to ensure that the voices of ordinary New Zealanders in an election campaign are not drowned out by fat cats opening their wallets to distort the will of ordinary people. 
Hon Tony Ryall 
: Why is the Government suppressing the release of every report and piece of advice the Ministry of Justice has given the Minister and the Government; and is it not the case that every single one of those reports is warning that this Government is doing irreparable damage to democracy in New Zealand and that is why the Government will not release the reports? 
Hon PETE HODGSON 
: I think I am entitled to say that reports characterised by words used in the member’s question simply do not exist. 
Hon Tony Ryall 
: Why will the Minister not release these papers today? 
Hon PETE HODGSON 
: I am not able to confirm that such papers exist but I am able to confirm that the Ministry of Justice is an adviser to the select committee and select committee members advise the Minister that the Ministry of Justice has provided a good deal of advice to the select committee. I just remind the House that the select committee comprises people from a wide range of parties. 
Hon Tony Ryall 
: How can there be full and open participation and debate on this bill and this issue when the Government is suppressing the release of Ministry of Justice advice to Ministers and the Government—this information was sought months ago it is now under appeal with the Ombudsman and the Ombudsman has written to the Minister saying that the paper should be released so why are these reports not being released? 
Hon Dr Nick Smith 
: Because they are a bunch of sneaks. 
Hon PETE HODGSON 
: I beg your pardon? 
Hon Dr Michael Cullen 
:  
Dominion Post  
MP of the Year! 
Hon PETE HODGSON 
: That is right. The member seeks to whip up a storm. I am not aware that any such weather event exists. I will say again that advice to the select committee is the property of the select committee. It will come out when the select committee reports back to the House and the Minister expects that report back to be soon. 
R Doug Woolerton 
: Would the Minister describe a bill that has had over 600 submissions as “suppressing public input”? 
Hon PETE HODGSON 
: The member makes a very good point. This bill was introduced almost 4 months ago. It has been subject to a good deal of comment a good deal of criticism and a good deal of scrutiny. That has happened in a public arena. Is that what secrecy looks like—does it happen in a public arena? One would not know would one that this bill has been through a public consultation process. The claims of secrecy are bizarre. 
Hon Tony Ryall 
: Is it the Government’s intention at any time before the Electoral Finance Bill is passed to release the advice that Ministry of Justice officials have prepared for Ministers and for the Minister of Justice herself on the Electoral Finance Bill and other issues—the advice has been prepared it has been confirmed by the ministry that there is advice to the Government but the Government is in dispute with the Ombudsmen—surely if this Government wants full public participation in this bill it would release the advice that its own constitutional and electoral advisers have given it; if it will not what is it hiding? 
Hon PETE HODGSON 
: The member continues to construct a conspiracy. He is making it up. Let me say to the member without hesitation that the Ministry of Justice complies with the Official Information Act of this land and with the processes that are inherent in it. 
Metiria Turei 
: Does the Minister agree that if non-party groups run million-dollar advertising campaigns that are simply parallel party vote campaigns—just as the Exclusive Brethren did last election with its blue pamphlets that stated “Change the Government”—then a cap on party election spending is simply pointless and we may as well just go to the American system of $1 one vote? 
Hon PETE HODGSON 
: The member is absolutely right. Let us just briefly reiterate what happened in the last general election in this country. The National Party had a party cap of $1 million and electoral expenditure on top of that. There was a party cap of $1 million. That is the law. The law constraining us on how much we as candidates for election can spend has been around since 1895. That was the law for the last election—$1 million for the National Party $1 million for the Green Party and $1 million for the Labour Party. But guess what? Along came the Exclusive Brethren which spent more than $1.2 million in addition to the National Party’s cap. This legislation states that that situation is not a very good idea and that we should try to put a stop to it. 
Hon Tony Ryall 
: Is the reason why the Government continues to suppress the advice of the Ministry of Justice to the Minister and the Government the fact that those reports point out that advertisements like the one I am holding which had to be counted as an election expense last time will not have to be included as an election expense this time which means that the Labour Party can steal even more taxpayers’ money to steal another election? 
Hon PETE HODGSON 
: It does not really much matter how much time that member wishes to devote to weaving a more and more elaborate conspiracy. It does not matter how much time he wants to spend on that. The fact is that the Ministry of Justice is bound to follow the Official Information Act in its entirety. It will follow the Official Information Act in its entirety and it will contest processes where it sees fit to do so. The ministry will do that. 
Hon Tony Ryall 
: I seek leave to table the request on 24 July that went to the Government for the release of this information in the public interest. 
Document not tabled. 
Business Opportunities Overseas—Government Assistance 
4.  
Hon MARK GOSCHE (Labour—Maungakiekie) 
 to the  
Minister for Economic Development 
: What Labour-led Government assistance is there to help New Zealand firms take advantage of new business opportunities overseas? 
Hon PETE HODGSON (Minister for Economic Development) 
: 
 Nearly 600 companies around New Zealand have signed up for the Government’s Market Development Assistance scheme in the last year. From an initial funding pool of $6.7 million in January 2005 the scheme has grown now to more than $50 million annually. That is $50 million of taxpayer support to mostly small or medium-sized exporters to help them break into new markets so that back home they can grow further and faster than would otherwise be the case. 
Hon Mark Gosche 
: What advice has the Minister received about when we will see the beneficial effects from this scheme—will it be immediate or will it take a longer time? 
Hon PETE HODGSON 
: The answer is really both. There are immediate gains for some exporters but market development is generally a longer-term undertaking as any exporter will confirm. Offshore markets take time to research to enter and to expand into. Our exporting community seeks to build strong and sustainable offshore markets and now it has a Government that will pick up half the tab of doing so. 
Dr Richard Worth 
: Why is New Zealand Trade and Enterprise not prepared to establish measurement mechanisms for the amount of money it expends on export support unlike its Australian counterpart Austrade—for then we would know what money was worthwhile and what money was wasted? 
Hon PETE HODGSON 
: The member misrepresents New Zealand Trade and Enterprise. It is very keen on an evaluation mechanism and indeed the first results from such a mechanism will be available in I think June 2008. 
Sue Bradford 
: Does the Minister agree that the Ministry of Economic Development’s successful Buy Kiwi Made programme has provided a greater opportunity for New Zealand manufacturers to sell their products locally rather than export them overseas and that the result of this is more local jobs kept here more money returned and retained in our communities and lower transport costs—all this better than if we had kept going with an ever-increasing dependence on imports? 
Hon PETE HODGSON 
: The member is right generally speaking that the value of an import substitution is equal to the value of an export and she makes a very good point. We must be careful however not to be tripped up by the tyranny of the word “or”. We must do both. 
Agriculture Minister—Setchell Employment 
5.  
GERRY BROWNLEE (National—Ilam) 
 to the  
Minister of Agriculture 
: Why was he consulted about the potential employment of Madeleine Setchell by the Ministry of Agriculture and Forestry? 
Hon Dr MICHAEL CULLEN (Leader of the House) 
 on behalf of the  
Minister of Agriculture 
: Because the chief executive chose to do so. 
Gerry Brownlee 
: Does the Minister have any further comment in addition to the one he made on radio this morning when he said that his reasons for not appointing Madeleine Setchell were “if anything went wrong she may have the bone pointed at her unfairly”; and does he not really mean that if a person has a family member who has a connection to the National Party then there will be no job for that person but if a person has a connection to the Labour Party then everything will be all right? 
Hon Dr MICHAEL CULLEN 
: No not at all. The Minister this morning was repeating the comments he made to Mr Sherwin that in these kinds of sensitive positions if something happens then no doubt the Opposition would be the first to point the bone given half the chance. 
Gerry Brownlee 
: Is the Minister concerned by this quote in the Hunn report from a mid-level manager inside the Ministry of Agriculture and Forestry: “Of course I will accept any decision the Minister makes but I am extremely worried about the precedent here. We have a number of employees with potential ‘perceived’ conflicts that may come into play with a change of government.”; and does this not indicate that this Minister has created a climate of fear in his office and an understanding that he will blacklist applicants and that he has also stacked his ministry with people who are of his political persuasion? 
Hon Dr MICHAEL CULLEN 
: I am not sure which ones the member is referring to but there is Mr Murray Sherwin the former Deputy Governor of the Reserve Bank and a well-known economic dry; or Dan Bolger whose surname might suggest something to the member. 
Gerry Brownlee 
: Has he seen the quote of the acting communications manager at the Ministry of Agriculture and Forestry who said: “Madeleine has been ‘up front’ about her relationship which in my view should pose no obstacle to her being able to take up the contract position”; if so why is it that the Minister then decided very directly that no she was not to have the position? 
Hon Dr MICHAEL CULLEN 
: It is absolutely clear that Madeleine Setchell was up front initially about her relationship and revealed a potential conflict of interest. It is also absolutely clear from both Mr Hunn’s report and Dr Prebble’s report that the decision not to employ Ms Setchell in the Ministry of Agriculture and Forestry was entirely that of Mr Sherwin and was not a decision by the Minister. 
Hon Dr Nick Smith 
: Yeah right! 
Hon Dr MICHAEL CULLEN 
: So we now have the member opposite who was of course convicted of contempt of court and was commented on by the court for his veracity saying that in fact Mr Hunn is a liar and Dr Prebble is a liar but the National Party stands up for the independence of the Public Service in saying so. 
Gerry Brownlee 
: If we are to believe that the Minister did not express an opinion about the employment of Madeleine Setchell why did Mr Sherwin convey a message to the mid-level manager of communications saying: “I have discussed with (the Chief of Staff) and he has discussed with the Minister. The answer is a clear ‘no’.”? 
Hon Dr MICHAEL CULLEN 
: If the member had managed to read a little bit further into the report he would have found that Mr Sherwin made it quite clear to Mr Hunn that the “no” was his “no” not the Minister’s “no”. The acting communications director seemed to be acting under a strange impression from offshore that the Minister was going to make the decision anyway. The member actually asked almost for the Minister to make the decision—that is not what Mr Sherwin did and it is certainly not what Mr Anderton did. 
Gerry Brownlee 
: What does the Minister take the House for when it is evident in the Hunn report that Mr Sherwin went to Mr Anderton and asked him whether it would be appropriate to employ Madeleine Setchell; if he did not do that and he did not make that request for that purpose why on earth is it in the report? 
Hon Dr MICHAEL CULLEN 
: Because indeed Mr Sherwin did go to Mr Anderton and ask whether there would be any difficulty. Mr Anderton said that a problem could arise if something went wrong in terms of a leak or whatever; then it did not matter whether Ms Setchell was involved the bone could be pointed at her. The report makes it abundantly clear that Mr Hunn is satisfied and Mr Sherwin is clear that Mr Sherwin made the decision alone. Now we have Mr Sherwin added to the list of those who are telling a lie. [ 
Interruption 
] That is right. The head of the Ministry of Agriculture and Forestry is telling a lie according to Mr Brownlee and the head of the State Services Commission is telling a lie. 
Gerry Brownlee 
: Yes. 
Hon Dr MICHAEL CULLEN 
: “Yes” he says. A former head of the State Services Commission is telling a lie but of course the National Party would not attack the independence of the Public Service! Does the member not see some contradiction so far in his logic line? 
Gerry Brownlee 
: Would the Minister care to believe that what I know is that Madeleine Setchell has been blacklisted by the Public Service and the evidence is abundantly clear for that; and that not only Mr Benson-Pope decided to give her the heave after she had been appointed after she had been headhunted but also Mr Anderton who knew that she had been through the difficulties at the Ministry for the Environment decided to do exactly the same? 
Hon Dr MICHAEL CULLEN 
: That line can be followed only if Mr Brownlee continues to insist that Mr Hunn a very distinguished former public servant tells a lie; that Mr Sherwin who has never been associated with the Labour Party in any shape or form as far as I am aware tells a lie; that Dr Prebble who I think for many years now has not exactly been on the left wing of politics tells a lie; but who cares as long as it is said under privilege! Why does the member not say it outside as clearly as that? 
Greater Wellington Regional Council—Regional Strategy 
6.  
HEATHER ROY (Deputy Leader—ACT) 
 to the  
Minister of Transport 
: Does the Minister stand by her statement that the Greater Wellington Regional Council’s regional strategy “fits well with the Government’s overall goals of economic transformation and sustainability.”; if so what are the benefits in terms of carbon emissions from the Government’s decision to fund 90 percent of Wellington’s new rail units? 
Hon JUDITH TIZARD (Associate Minister of Transport) 
 on behalf of the  
Minister of Transport 
: Yes. The new rail units are part of the ongoing commitment of the Government and the Greater Wellington Regional Council to a sustainable transport system for the region. 
Heather Roy 
: Is the Minister aware that the business case used to justify buying rail units rather than diesel buses is full of errors including using the outrageous assumption that buses use 2.8 litres of fuel per kilometre—10 times the real usage figure—to calculate carbon dioxide emissions and that the Government is actually funding 90 percent of the cost of trains that will emit twice as much carbon dioxide as buses do? 
Hon JUDITH TIZARD 
: We have moved in the last 8 years to follow the regional councils’ priorities expressed through their regional land transport strategies. This strategy for Wellington has been argued for many years and given that the rail system provides 70 percent of public transport journeys at peak times and has serious bottlenecks I am happy to say that I think this new provision will address the issues that Wellington and the Government are concerned about. 
Madam SPEAKER 
: It is very difficult to hear if members are chattering away. 
Heather Roy 
: I raise a point of order Madam Speaker. The Minister failed to address my question at all. It was very specific and asked whether the Minister was aware that the business case was full of errors. She described in great detail what a great strategy it was that she was endorsing but she failed to answer my question which was whether she was aware that the business case was full of errors. I cited a very specific example and she referred to that not once in her answer. 
Madam SPEAKER 
: Although members cannot require a specific answer the Minister may like to address that point in the question. 
Hon JUDITH TIZARD 
: It is a debatable issue and it has been debated endlessly at most regional councils. 
Hon Peter Dunne 
: Will she confirm the rail funding decision and the announcement in the Budget earlier this year of the upgrade of the Johnsonville line in order to secure that line’s future notwithstanding private criticism from the new chair of the Greater Wellington Regional Council that the Government was wrong last year to dismiss out of hand the flawed plan from the Mayor of Wellington and the Wellington City Council to close the Johnsonville line and turn it into a busway? 
Hon JUDITH TIZARD 
: As the former Minister with responsibility for Auckland Issues I have done my best to avoid many of the details of Wellington issues but the Minister of Transport undoubtedly is aware of that issue and has taken it into consideration. Our concern is to make sure that we have a rail system in Wellington that is useful for both passengers and freight; that the older trains—some of which are more than 70 years old—are replaced; and that we have a rail system that provides affordability and sustainability and an ability to increase frequency and capacity. I am delighted to say that it does that. 
Sue Kedgley 
: Can the Minister guarantee Wellingtonians that the entire rail-track in the Wellington region will be upgraded in time for the arrival of the new smart electric rail units in 2010 and that that will include fixing all the rotting poles the parts of the track that have been buckling and so forth; and can she further confirm that unless this upgrade is completed in time these wonderful new smart trains will not be going anywhere? 
Hon JUDITH TIZARD 
: I can tell Wellingtonians that the key objective of the $885 million package is to make sure that the work is done on time and sustainably. I am told that the track upgrades are scheduled to coincide with the arrival of the new trains in 2010. 
Heather Roy 
: How is her goal of economic transformation enhanced by giving a $200 million subsidy to rail at the expense of roading projects to relieve congestion including congestion at Transmission Gully Ngauranga Gorge Kilbirnie and the Basin Reserve; and how is sustainability achieved when her Government has endorsed a scheme that doubles carbon emissions by choosing rail over other infrastructure? 
Hon JUDITH TIZARD 
: What we have in New Zealand is an intermodal system which we hope is going to be better integrated. But I would also note that that member said in her own diary on the ACT party’s news website: “… our love affair with cars is too passionate—restricting emissions would mean restricting car use which would lose votes. There has been much talk about public transport … Overcoming the psychological barrier is a major undertaking.” I think that providing up-to-date rail services in a region where 70 percent of public transport is rail transport is probably a good way of changing the psychological mindset. 
Heather Roy 
: I seek leave to table the Wellington commuter rail alternative to roading evaluation which shows the— 
Madam SPEAKER 
: Leave is sought to table that document. Is there any objection? Yes there is objection. 
Heather Roy 
: I seek leave of the House to table the Wellington commuter rail network business case which is released— 
Madam SPEAKER 
: Leave is sought to table that document. Is there any objection? Yes there is. 
Heather Roy 
: I seek leave of the House to table the Land Transport New Zealand board paper stating that funding for rail units will be at the expense of— 
Document by leave laid on the Table of the House. 
Environment Chief Executive—Confidence 
7.  
Hon Dr NICK SMITH (National—Nelson) 
 to the  
Minister for the Environment 
: Does he have confidence in the chief executive of the Ministry for the Environment? 
Hon TREVOR MALLARD (Minister for the Environment) 
: 
 Confidence in a chief executive is a matter for the State Services Commissioner. 
Hon Dr Nick Smith 
: Can the Minister explain why it has been necessary to increase the number of staff employed for public relations in his ministry from 3 in 1999 to 11 as well as having an eightfold increase in the budget for communications contracts? 
Hon TREVOR MALLARD 
: No. 
Hon Dr Nick Smith 
: I raise a point of order Madam Speaker. The question asked the Minister to explain a large increase in the number of staff. Is it now adequate for a Minister simply to say that he is not going to bother explaining to the people of New Zealand and to this Parliament why there has been such a huge increase? 
Hon TREVOR MALLARD 
: The question asked “Can the Minister explain …” and the answer is no. 
Madam SPEAKER 
: Exactly. I thought the Minister very succinctly for once addressed the question. 
Hon Dr Nick Smith 
: Why did his ministry place advertisements that seek staff “to work on issues that are at the forefront of New Zealand’s political agenda” advertisements which have subsequently been deemed inappropriate by the State Services Commission because of their political content; and is that not further evidence of Labour’s politicisation of this important ministry? 
Hon TREVOR MALLARD 
: Because it had bad judgment; and no. 
Hon Dr Nick Smith 
: Referring to the decision by the ministry to employ Clare Curran the Otago-Southland representative on the Labour Party’s ruling council and the author of a 10-page strategy paper to Labour’s conference in 2006 entitled  
How Labour Can Take Charge of the Language of Debate and Discussion in New Zealand 
 why was she awarded an uncontested contract with the assistance of MP and climate change Minister David Parker; and does that not show the extent to which Labour will abuse the Public Service and taxpayers’ money for its own political ends? 
Hon TREVOR MALLARD 
: There were a lot of assertions in that question. The first point is that Clare Curran was not a member of the national council of the Labour Party at the time of the appointment. The second assertion is wrong. I am not sure whether the allegation was that it was Mr Parker or Mr Benson-Pope who insisted on her appointment; that is not correct. 
Hon Dr Nick Smith 
: How is it that Madeleine Setchell lost her job in communications at his ministry on the basis of her being the partner of John Key’s press secretary Kevin Taylor who is neither a member of nor an activist for National but a professional adviser when she had secured the job under an open competitive process whereas it is quite OK for Clare Curran to work in the same ministry on communications when she is a highly active member of the Labour Party and the author of a key political strategy document and when that job was allocated uncontested; and does that not show the dodgy double standard in his ministry where we are seeing an increased politicisation of such appointments and decisions? 
Hon TREVOR MALLARD 
: On the first part of the question I will not defend the treatment of Madeleine Setchell; that was wrong. On the second part of the question I advise the contract is between $10000 and $50000. There is a requirement within the ministry’s operating policy to obtain at least three quotes. I am advised that that was done in this case. 
Hon Dr Nick Smith 
: Does it not indicate a politically incestuous environment at the ministry when the key player in the firing of Madeleine Setchell was Steve Hurring who just happens to be the Minister’s own campaign chair in Hutt South and when Clare Curran who is now challenging David Benson-Pope for his seat was awarded that contract for communications at the ministry on Minister Parker’s insistence; and does that not all point to a dodgy Labour Government repeatedly abusing its powers for the politicisation of our Public Service? 
Hon TREVOR MALLARD 
: I think that a number of points need to be addressed in that question although it was quite a long one. Firstly Steve Hurring is not my campaign manager. 
Hon Dr Nick Smith 
: Was at the last election. 
Hon TREVOR MALLARD 
: Well yes; he has lived in the Hutt in the past but he has shifted to town and is not my campaign manager—and that is just a slight matter of fact and truth that that member ignores. Actually much of the rest of the story is the same. Can I make a second point? I do not condone the approach taken to Madeleine Setchell. I have said that repeatedly. They got it wrong; Don Hunn got it right. 
Hon Dr Nick Smith 
: What about Clare Curran? 
Hon TREVOR MALLARD 
: I say to the member that at the same time as and subsequent to Clare Curran’s employment media advice was being received by Ministers’ offices and the senior part of the ministry from someone who has very close links to the National Party—someone who had a lot of experience in working as a political appointee of the National Party— 
Hon Dr Nick Smith 
: Try and smudge someone else. Tell us about Clare Curran. 
Hon TREVOR MALLARD 
: No no. It is someone whom I really like someone who did a really good job and her name was Anna Hughes. 
Hon Dr Nick Smith 
: I seek the leave of the House to table the advertisement for jobs placed by the Ministry for the Environment that seeks people who will be at the forefront of New Zealand’s political agenda. 
Madam SPEAKER 
: Leave is sought to table that document. Is there any objection? Yes there is objection. 
Hon Dr Nick Smith 
: I seek the leave of the House to table the paper by Clare Curran that says: “This paper is about Labour taking charge of the language of debate and discussion in New Zealand.” 
Document by leave laid on the Table of the House. 
Youth—Government Initiatives 
8.  
Dr ASHRAF CHOUDHARY (Labour) 
 to the  
Minister of Education 
: What steps is the Government taking to ensure all young people achieve their potential and make a positive contribution to New Zealand’s economic transformation and social development? 
Hon CHRIS CARTER (Minister of Education) 
: 
 I recently received a report from the Ministry of Education that shows it is on track to halve the number of early leaving exemptions it will approve this year. In order to ensure that no young person is left behind the Ministry of Education is working with Career Services to develop personalised learning and career plans for many of those who previously would have been allowed to leave school early. These plans will provide a rational and practical step to encourage students to remain in and engaged with school and further education. 
Dr Ashraf Choudhary 
: What else is the Government doing to ensure all young people are equipped for our 21st century economy and society? 
Hon CHRIS CARTER 
: As the Prime Minister told the Labour Party conference recently attachment to and engagement in education is critical to equip young people to participate in New Zealand’s economic transformation. Our Government has introduced many innovative policies like 20 hours’ free early childhood education Young Apprenticeships and Modern Apprenticeships to keep young people engaged in learning. But there is more to come. For example through the recently ratified secondary teachers’ collective agreement we have agreed to a project that looks at the future of secondary schooling and our new curriculum enables teachers to equip their students with the skills and competencies they need in order to succeed in the 21st century. 
Sexual Abuse Allegations—Ministry of Education Procedures 
9.  
KATHERINE RICH (National) 
 to the  
Minister of Education 
: Does he stand by statements made on his behalf in the House yesterday regarding the actions of the Ministry of Education after being made aware of sexual abuse allegations against the principal of Hato Paora College: “I am most certain that the Ministry of Education has done its darnedest to ensure that this matter gets to a better place.”; if so why? 
Madam SPEAKER 
: I understand the answer will be a little longer than normal. 
Hon CHRIS CARTER (Minister of Education) 
: 
 Yes. This is the third time this week that questions have been raised about whether correct procedures were followed at Hato Paora College over sex abuse allegations against the principal. I want to believe that the member is raising these questions to try to ensure that the systems dealing with such allegations are the best possible that we could have. To my knowledge in this case they were. The member alleges that the police became involved in the case only through media inquiries. That is not correct. I am advised by the officer in charge of the case that police were informed of the situation by Child Youth and Family on 3 August which is the same day that the school board informed the Ministry of Education of the issues. Such notification is exactly in line with the protocols in dealing with child abuse allegations between the police Child Youth and Family the School Trustees Association and the Ministry of Education which were signed in 1996. I remind the House that attempts to get a cheap headline out of this issue are having a very negative impact on pupils staff and parents of the school involved. 
Katherine Rich 
: Why does the Minister pretend that there was a formal and planned notification to Child Youth and Family and the police as part of an inter-agency protocol when the only reason Child Youth and Family found out about the case was not through a formal notification and when police were contacted by local media in Palmerston North they had no idea about anything to do with the allegations? 
Hon CHRIS CARTER 
: The member was clearly not listening to my initial answer. I have been advised by the officer in charge of the case that the police were informed of the situation by Child Youth and Family on 3 August which is the same day that the school board informed the ministry about the issue. 
Lesley Soper 
: What reports has the Minister received about the effect that this continued publicity around these sexual abuse allegations at Hato Paora College is having? 
Hon CHRIS CARTER 
: I have received reports that the chairperson of the board of trustees has knowledge of students receiving hostile text messages about their personal safety following the publicity generated by Katherine Rich. I am sure the parents are very distressed about the potential impact on their sons’ education and on the reputation of their school. 
Gerry Brownlee 
: I raise a point of order Madam Speaker. I ask you to think about what the Minister has just said. That is a most outrageous allegation. I think you need to ask him to confine himself to answers that are within the bounds of the question that has been asked. He cannot possibly have even the slightest bit of evidence for the outrageous assertion he has just made. 
Hon CHRIS CARTER 
: Speaking to the point of order Madam Speaker I point out that I would not make such an allegation without carefully checking it. That is an allegation that the chairperson of the board of trustees has made to my ministry and that allegation was made today. 
Madam SPEAKER 
: Certainly it is within the bounds of the original question. 
Katherine Rich 
: If the Minister is 100 percent sure that the police found out about these allegations from the school at exactly the time that the school started its investigation has he had it explained to him why the police only started their investigation some time after the board had completed its own internal investigation and after they found out from the local media? 
Hon CHRIS CARTER 
: Clearly the member did not listen to the answer I gave earlier in the week. When she asked that very question I explained to her and to this House that the investigation done by the board cleared the principal. Further evidence was taken to the police by one of the children who had complained. This was new evidence and it was on that basis that the charges were laid. The police themselves have said that on the evidence presented to the board the inquiry was carried out correctly and that it had to come to the conclusion that it did. New evidence was presented to the police subsequent to the investigation by the board. 
Katherine Rich 
: Why does the Minister keep repeating misleading statements in the House regarding my interaction with the board when my office was told by the chair of the board when she phoned my office: “It’s great that Katherine is taking an interest and we are glad that she is raising this issue publicly.”? 
Hon CHRIS CARTER 
: What an interesting question from the member. Exactly the opposite has been told to my staff by the chairperson of the board of trustees who has condemned the member for her actions in publicising the issue and who has told my office that students at the school are receiving text messages from their friends asking whether they are safe. She told us that she has personally told the member that she is putting enormous stress on the school just as National Certificate of Educational Achievement exams are about to begin. She told my office that she has personally told the member to desist from ruining the reputation of the school. 
Katherine Rich 
: If his ministry is contacted tomorrow by a school that is dealing with serious allegations of sexual abuse will his ministry advise the school to take those allegations to the police for investigation as was suggested by the former Minister Steve Maharey when contacted about these allegations when he told the paper that if schools became aware of allegations of criminal activity they would be obliged to alert the police; and why will his ministry not tell schools to do that? 
Hon CHRIS CARTER 
: Once again the member is distorting the facts. The facts of the matter are that the board of trustees is obliged to notify Child Youth and Family when such allegations are made. Under the inter-agency protocol that I will attempt to table in a moment Child Youth and Family is required to notify the police and vice versa. So what the member is asking for is actually happening and in this case it did happen. 
Katherine Rich 
: If Steve Maharey knew what to do when the ministry was faced with serious sexual allegations against a school principal why does the Minister not know what to do and why does he not just tell his ministry that in the event that this happens again it should offer the common-sense advice which is to take these allegations to the police so that they can be investigated properly? 
Hon CHRIS CARTER 
: Listeners and viewers of Parliament today must be mystified as to why the member cannot get it. The facts are that schools are obliged to notify Child Youth and Family; Child Youth and Family is obliged to notify the police. In this case it happened. So what is Ms Rich’s problem here? What is her question? 
Madam SPEAKER 
: Was there a point of order in regard to the seeking of leave? 
Hon CHRIS CARTER 
: I seek leave to table  
Breaking the Cycle: Interagency Protocols for Child Abuse Management 
 signed in 1996 which existed throughout the time of the National Government. 
Document by leave laid on the Table of the House. 
Food-borne Illness—Government Initiatives 
10.  
JILL PETTIS (Labour) 
 to the  
Minister for Food Safety 
: What Government initiatives have been put in place to address food-borne illness in New Zealand? 
Hon LIANNE DALZIEL (Minister for Food Safety) 
: 
 Given that this week is Foodsafe Week there are many food safety promotional activities being undertaken around the country including television advertisements and brochures emphasising the importance of safe handling of food at home. I was pleased to present the Food Safety For Life Award to three students from Hastings Girls’ High School this morning for their clever and original advertisement stressing the importance of clean hands when handling food. The primary initiative of Government to reduce food-borne illness has been the establishment of the New Zealand Food Safety Authority as a stand-alone agency and its extensive programme including the campylobacter strategy. 
Jill Pettis 
: Can the Minister please advise why it has been necessary to develop a campylobacter strategy and what does it involve? 
Hon LIANNE DALZIEL 
: The campylobacter strategy aims to halve the number of human cases of food-borne campylobacter infections over the next 5 years. This is necessary as New Zealand has one of the highest notified rates of campylobacter in the OECD. The poultry industry has agreed to meet a 90 percent reduction in the number of bacteria on chicken carcases from 1 April 2008. However it is important that there is vigilance across the entire food chain and that consumers play their part as well by adhering to the four C’s—clean cook cover and chill—all of which are vitally important in reducing food-borne illness. 
Sue Kedgley 
: Will the Minister consider as part of her safe-handling strategy requiring large warning labels to be placed on all fresh chicken sold in New Zealand stating “May contain campylobacter” given the University of Otago’s recently released research that found that most chickens in New Zealand are contaminated and that New Zealand should seriously consider banning the sale of fresh chicken for human consumption as a result? 
Hon LIANNE DALZIEL 
: I do not think that labelling chickens in that regard would be of any assistance at all. The assertion that the member makes is quite correct—we do have an extremely high rate of campylobacter within our chickens. But I want to say to the House—and I think it is important given that we are heading into the barbecue season—that cooking chicken properly prevents the campylobacter from infecting humans by way of consumption. 
Question No. 9 to Minister 
Dr the Hon LOCKWOOD SMITH (National—Rodney) 
: 
 I raise a point of order Madam Speaker. I apologise for not raising this point of order the moment it happened but I was so gobsmacked that it has taken me a moment to work out what just went on. At the end of the previous set of questions I believe I heard you as Speaker invite the Minister to seek leave to table documents. That is something that the Speaker should not be involved in. Members have a perfect right to seek leave to table documents but where the Speaker invites them to do so it implies a relationship between the Speaker and in this case the Government that could be seen to be inappropriate. 
Madam SPEAKER 
: No I have heard enough. The Minister in answer to one of his questions indicated he was going to table documents. Rather than interrupt the next questioner I asked people whether they were going to table documents because often members unfortunately forget. That was what happened. 
SuperGold Card—Advertising Budget 2007-08 
11.  
JUDITH COLLINS (National—Clevedon) 
 to the  
Minister for Social Development and Employment 
: How much has the Ministry of Social Development budgeted for advertising the SuperGold card in 2007-08? 
Hon RUTH DYSON (Minister for Social Development and Employment) 
: 
 The total communications budget for the SuperGold card in 2007-08 is $1.154 million. This includes not only the advertising of the launch of the card but also marketing activities and promotional materials. 
Judith Collins 
: Why did the ministry advise in the 2007-08 estimates examination in June this year that it planned to spend less than $200000 on advertising the SuperGold card in the current year but by August it had changed its mind and decided to spend almost $1.2 million which was a sixfold increase; and will this additional advertising spend meet the Prime Minister’s requirement that Government departments err on the side of caution when promoting policies? 
Hon RUTH DYSON 
: In answer to the latter question yes it certainly will; in answer to the former question departments cannot announce appropriations that have not yet been agreed. 
Barbara Stewart 
: Can the Minister confirm that literally hundreds of potential business partners are currently in negotiations to join the SuperGold card scheme to offer even more concessions to our seniors? 
Hon RUTH DYSON 
: That is a very risky question from the member who knows that her leader is out of the country and neither of us should be pre-empting his announcements on further partnerships with the SuperGold card that will be made shortly. But I can confirm that at the launch of the SuperGold card 187 businesses were offering discounts and services to older New Zealanders; today 485 business partners have signed up representing over 3000 outlets throughout New Zealand. The list will continue to grow with more being added every day. 
Judith Collins 
: Who is telling the truth here: the Minister who is saying that the Government could not announce in the estimates spending that was subsequently announced a couple of months later or the ministry which says the advertising spend was increased after the estimates or the Associate Minister for Senior Citizens who has confirmed in writing that the ministry decided after the Budget was debated to up its advertising budget by 600 percent—who is telling the truth? 
Hon RUTH DYSON 
: All three parties that the member noted are telling the truth but consistent with every other question that member asks she is not. 
Judith Collins 
: Oh she is getting angry now. 
Madam SPEAKER 
: That was entirely unnecessary. Would the member just ask the question. 
Hon Dr Nick Smith 
: I raise a point of order Madam Speaker. Can you tell the House why when a Minister clips on to the end of his or her answer a derogatory comment about the member you are silent but when the member in seeking to ask a question responds suddenly you have a go at her? 
Madam SPEAKER 
: No. I will tell the member what that ruling was about. The member in her question raised the issue of truthfulness. That was responded to by the Minister in her answer. The member then prefaced a supplementary question with a comment that was bound to cause disorder. As we have gone through the day it has become increasingly difficult—at least at this end of the Chamber—to hear the questions and the answers. 
Judith Collins 
: Will her ministry seek the advice of the Auditor-General to ensure that its promotion of the SuperGold card meets the guidelines of the State Services Commission the Auditor-General having forced the ministry to slash its advertising budget for Working for Families because it was such an outrageous misuse of taxpayer money on political advertising? 
Hon RUTH DYSON 
: The guidelines of the State Services Commission are very clear. If there is any doubt by any department including my own I would certainly support its moving to consult the Auditor-General. 
Judith Collins 
: How many taxpayer-funded publicity campaigns to promote Government policy like the SuperGold card will her ministry run until the next election? 
Hon RUTH DYSON 
: The rules are very clear on electioneering: Government departments are not allowed to electioneer. There is only one reason that that member might be concerned about promotion of the SuperGold card being promotion of this Government’s policy and that is that her party will be scrapping it. Thank you for that confirmation. 
Emissions Trading Scheme—Reports 
12.  
Hon MARIAN HOBBS (Labour—Wellington Central) 
 to the  
Minister responsible for Climate Change Issues 
: What reports if any has he received on the proposed emissions trading scheme? 
Hon DAVID PARKER (Minister responsible for Climate Change Issues) 
: 
 A number of independent reports have supported the scheme’s design. To name but two the International Energy Agency—the IEA—in its recent report gave the scheme a positive review and Terry Tamminen who has been an adviser to Arnold Schwarzenegger on climate change recently endorsed it on his visit to New Zealand. 
Hon Marian Hobbs 
: What other reports has the Minister received on the proposed emissions trading scheme? 
Hon DAVID PARKER 
: I have received reports that this scheme is amongst a number of emissions trading schemes around the world. A large number of countries have already signed up to such schemes. That includes the many countries in the European Union—between 20 and 30. Its scheme commenced in 2005. Other parts of the world that have a scheme in place or are developing one include Norway Switzerland various states in the United States and of course Australia. All of New Zealand’s activity has led Gordon Brown to request our Prime Minister to get New Zealand to join the International Carbon Action Partnership and this is good for New Zealand because it ensures that we are able to advance our interests as we help the world. 
Amended answers to Oral Questions 
Question No. 12 16 August 
Hon RUTH DYSON (Minister for Social Development and Employment) 
: 
 I want to correct an answer to oral question No. 12 on 16 August 2007 and two related written questions—Nos 14713 and 14471—all three from Anne Tolley. In my answer to the oral question—and consequently used by the member for obvious reasons in her written questions—I quoted the number of notifications to Child Youth and Family for the year ended 30 June 2007 as being 73326. With my apologies to the member the figure was 75326. 
Appropriation (Continuation of Interim Meaning of Funding for Parliamentary Purposes) Bill 
In Committee 
Debate resumed from 14 November. 
Clause 4 Expiry 
( 
continued 
)  
Hon TONY RYALL (National—Bay of Plenty) 
: 
 I want to ask the Minister in the chair the Hon Dr Michael Cullen whether he could give us an explanation as to why there are a couple of incredibly divergent ways that candidates will be handled in this election campaign because of these rules. 
Hon Dr Michael Cullen 
: It’s on the expiry date. 
Hon TONY RYALL 
: Oh on the expiry date. I would like him to explain to us why this bill should not expire early. I think that this bill should expire early and that Parliament should have to go back and sort it out again on this basis. 
As this Minister knows electoral law in this country has more or less been developed on a reasonably bipartisan or multipartisan basis over many many years. It has been done on the principle that the victor should not be able to change the election law every time it wins. In my time in Parliament and also in the Minister’s time the issue that has been the sole area of divergence amongst political parties was when the electoral rolls would close for an election period. National used to say it was 1 month before the election and Labour used to say it was the day before the election. Well now there seems to be agreement on the rules that stand. 
Virtually every piece of significant electoral law has been agreed between both parties and it has been for the very good reason that we should not have a situation where the victor is able to write the electoral rules to suit itself. As the member knows things like the Standing Orders operate on a principle of what goes around comes around. What might happen to an Opposition because of a Government’s majority in one Parliament might easily be reversed to happen to that Government when it is in Opposition next time. It is that principle that has encouraged parties to more or less always come to some sort of agreement on electoral law. 
The Minister can say that Labour has voted against National’s electoral laws forever but I say to him that he should go and look at the debate. There have been arguments on very minor issues but on the key issues in respect of the electoral settings in this country there has been agreement between the parties. The Minister should look for example at the development of the MMP legislation in 1993-94. Both parties worked very cooperatively. Mr McCully and Mr Caygill worked very cooperatively to get that legislation together. That ensured that the legislation is durable. Parliament has not had to change the basic framework of that legislation. That is the benefit of having all parties working together. I would like the Minister to answer why we cannot have that approach this time. 
Can the Minister answer—with the red printing presses running overtime down at Labour Party headquarters—why he is proposing a number of pieces of legislation that state that if this brochure I am holding were distributed by a sitting Labour MP it would not be an election expense but if it were distributed by a non-MP Labour candidate then it would be an election expense? How does that work? It is the same brochure with the same content but when distributed by an MP it is not counted as an election expense whereas when it is distributed by a candidate it is counted as an election expense. I think the Minister owes an explanation to the Committee. 
A number of amendments have been moved on the expiry date of this bill because we think the expiry date should change. Parliament should have to work in the way that it has done previously to make sure that there is a multiparty approach to this bill. These sorts of bills are all about the majority enforcing its view on the minority without any consultation or taking matters into account. The consequence of that is that we are ending up with a bill that sets a very bad precedent. Of course the Minister will say that Gerry Brownlee agreed with all this. That is simply not correct. Gerry Brownlee made it absolutely clear that this bill would not work in the interests of New Zealand and as has been stated previously that the rules that applied before the last election should apply now because they were clear. 
If the Labour Party used $800000 of taxpayers’ money to send its pledge card then the pledge card should have counted as an election expense. Why are the rules changing in this legislation so that the pledge card will no longer be considered an election expense? With what justification is this happening? Does the Minister have the same justification as Peter Brown gave the Committee last night which is that the legislation will protect him from the Auditor-General? 
Hon Dr NICK SMITH (National—Nelson) 
: 
 I too want to contribute to this Committee debate because the Appropriation (Continuation of Interim Meaning of Funding for Parliamentary Purposes) Bill is one of the worst rorts in writing electoral law that this Parliament has ever seen. It is the sign of an absolutely desperate Labour Party that will do anything and pull any sort of trick to try to win the next general election. 
I want to take Parliament back to the well-settled law around Reg Boorman. He was a Labour member of Parliament who used parliamentary resources to win the Wairarapa seat in 1987. The significance of that decision was that it set a very clear baseline which was that it did not matter how pamphlets or material were paid for if they appeared in the 3 months before an election and were electioneering they were included within the expenditure limit. What is being proposed in this bill and its associate bill the Electoral Finance Bill is to completely change that case law and to give sitting members of Parliament a huge advantage. The member in the chair Dr Cullen says— 
The CHAIRPERSON (Ann Hartley) 
: Can I just bring the member back to the bill please. We are talking about the expiry clause. 
Hon Dr NICK SMITH 
: We are indeed talking about the expiry date of this bill. The issue is that we have had settled rules around the allocation of expenditure and the limits and around the way they operate in an election campaign. This bill seeks to override them. This bill overrides the Auditor-General. 
Peter Brown perfectly let the cat out of the bag last night. He said that this bill is about saving us and about protecting members of Parliament from the Auditor-General. That is what Peter Brown said. Members on this side of the Committee asked why we have to have a special bill to protect us from the Auditor-General but only until 30 June 2009. In other words the Government is saying: “Let’s just cheat for the next election because the polls aren’t looking too good. We know it’s unprincipled. We know it’s just a cash grab. We know it’s just about cheating.” But as the  
New Zealand Herald  
so accurately stated— 
Hon Dr Michael Cullen 
: This member talks about cheating! 
Hon Dr NICK SMITH 
: Absolutely! The Minister in the chair Dr Cullen has no respect for democratic principle and no respect for fair elections. He has become so intoxicated by power that he will do anything to hang on to his role including cheating on electoral laws. 
I say to the Minister in the chair that an unprincipled National Government could easily have introduced biased electoral laws with the huge reforms that involved the introduction of MMP. But National actually passed those huge electoral laws back in 1994 with an absolute consensus between National and Labour. Yes we could have been arrogant oafs and skewed the scrum; we did not because this party—the National Party— 
Hon Shane Jones 
: Better pronunciation Nick. 
Hon Dr NICK SMITH 
: —is actually committed to some basic democratic principles I say to Shane Jones. 
I would like Mr Jones or Dr Cullen to explain how it is fair that under this bill we have a definition of electioneering that is completely different from that which applies to citizens under the Electoral Finance Bill. Why is it that if a private citizen wants to publish a pamphlet then it is deemed to be electioneering if it expresses any view on any subject on which any political party or candidate has a view? But when it comes to the exclusion of the use of public money and the definition of electioneering for politicians it is basically deemed to be electioneering only if the pamphlet states “Vote for me”. We all know of material that goes far wider than that. 
I know that Dr Cullen has got all excited in the House recently because I put out a newsletter in the last month. That newsletter talks about my work in Nelson and the hard work the National Party does in advocating views that are important to the people of Nelson. But what is peculiar to my situation I would say to Dr Cullen is that the newsletter has been in the same format for 18 or 19 years and I have never been found—unlike the Minister in the chair Dr Cullen— 
Hon Shane Jones 
: Never been found. 
Hon Dr NICK SMITH 
: —I have never been found by the Auditor-General to have breached the rules around the use. 
Hon Darren Hughes 
: What did the High Court judge say? 
Hon Dr NICK SMITH 
: Well the members opposite take great pride in this. Is it not interesting? I stick up for a family—a mum and a dad who want to see their kids. Members opposite think it is funny that a mum and dad have not seen their children for 6 years. 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 Dr Smith is a member who cannot even shut up. He should sit down and shut up. 
Hon Dr Nick Smith 
: Oh the Minister says “shut up”. I would say to the Minister— 
The CHAIRPERSON (Ann Hartley) 
: Please be seated. The member’s time has expired. 
Hon Dr Nick Smith 
: It’s not for him to be the Chair—or has he taken over that role constitutionally as well? 
The CHAIRPERSON (Ann Hartley) 
: Please be seated. I will just warn the member. The bell went and the member knows he should sit down. 
Hon Dr MICHAEL CULLEN 
: Those two speeches were so full of factual errors and misinterpretation that it was quite extraordinary. Let us just take one small point. Dr Smith said he has put out the same newsletter for 18 or 19 years. That is remarkable. He has been an MP for 17 years but he has put out the same newsletter for 18 or 19 years. That is very very well done. How prescient of him at the start of his political career—17 years as an MP! 
Secondly Dr Smith has got it wrong about the Electoral Act and the definition in relation to MPs. That definition appears in the 1993 Electoral Act which was introduced under the previous National Government. It has not changed and it is still the same—he is wrong. 
The third point is that we were asked why we did not try to put in place new legislation. Well we did try. That is exactly what we have spent much of this year talking with all the other parties about. National got to the point where it said it actually thought that was a good idea but it would not support it. National wanted to debate the issue in the context of the Electoral Finance Bill so it said it was not going to agree to a new permanent regime. National members did say the legislation should be rolled over and yes rolled over to the middle of next year sometime just before an election. That was also pretty clear. 
Then the member said that he has never said anything like “Vote for me” using the Parliamentary Service expenditure. What does “Why New Zealand needs a new Government” mean from a National MP? Or does he think that Nelson voters are so thick that when there is a Labour-led Government in office “Why New Zealand needs a new Government” does not mean “Vote National”? Is that what he thinks? The member actually has one of the more intelligent electorates in the country in Nelson although voters there have had a lapse for six elections in a row in that regard. Actually no I am sorry—it is not six; it is five. Dr Smith was first elected in 1993 not 1990. He actually did not get elected in 1990. He has been an MP in this place for only 14 years; I correct myself as well as him on that. The newsletter also said “nick4nelson”. “Nelson get nicked” we might say if we put it somewhat differently in terms of the approach from that member. 
The real point about all of this is that the law is not settled. What this bill does is to return the law and extend the current law to what everybody understood it to be before 2005. That includes the National Party’s understanding of it in the 2002 election campaign with Bill English’s “My commitment” public advertisement in that campaign having been paid for by the Parliamentary Service. Or is Mr English a hypocrite? Oh well that is an interesting response to that point. One can fill in the gaps after the three dots in that regard. 
Hon Dr Nick Smith 
: Did the Auditor-General find him in breach? No. 
Hon Dr MICHAEL CULLEN 
: What the Auditor-General refused to do was to look at what National did spend its money on. He was asked to do so and he refused. He did not look at the money that that party spent on staff in 2005 and at what those staff were doing and we all know that because National refused to tell us what those staff were doing. Those members refused to reveal their accounts at that point. [ 
Interruption 
] Oh we know exactly what the member’s staff were doing at that point: they were engaged in electioneering. 
But the fundamental flaw in the argument from the National Party is this: MPs do not stop being MPs 3 months 6 months or 9 months before an election. MPs stop being MPs at midnight on election night unless re-elected. That is actually the law. And MPs surprisingly are engaged in politics. I know that Dr Smith is not. I know that Dr Smith adopts a very pure life publicly and privately. I know that he always tells the truth. I know that he never questions the referee whether it is the Auditor-General or the court or whomever it may be. I know that no member of the National Party would ever accuse independent assessors in the Public Service of lying. I know that some of them gave the impression that they did— 
Hon Dr Nick Smith 
: Like Prebble—we caught him lying. 
Hon Dr MICHAEL CULLEN 
: Oh the member did—sorry he just did. I correct that. He did just accuse the State Services Commissioner of lying—and Mr Hunn the former commissioner and Mr Sherwin the head of the Ministry of Agriculture and Forestry. I ask whether there is anybody else the member would like to add to the list of liars in the public sector inside the Chamber and under privilege. I ask whether the member would like to add any more names in that regard. The only person I know of in this House about whom a court has said he lied is Dr Nick Smith. The court said it did not believe the tale that he told. That is what the court said. 
And I say MPs do have to explain their views and will continue to do so. 
CHRIS TREMAIN (National—Napier) 
: 
 Regardless of the law fair or not that was the Deputy Prime Minister for those who are listening and who are not aware of that fact. The Deputy Prime Minister is currently a constituent of mine in the seat of Napier back in the mighty Hawke’s Bay. Ironically he is a man who is here right now putting this bill before the House to screw the scrum in electoral law and he is a man whom I challenged last week to stand against me in a general election in the seat of Napier. And did he? The silence was deafening from the Deputy Prime Minister. He does not have the guts to stand against me in the seat of Napier to test whether he would be able to deliver on his laws—the screwing of the scrum that we are talking about today. 
It is that seat that I would like to bring voters back to tonight—back to the reality of what this proposed law will do. I personally believe it is wrong. I believe that elections should be fair that there should be an even playing field and that there should be no screwed scrum. 
I want to bring members back to a sense of reality. I want to bring members back to the lowest common denominator in an election. The lowest common denominator is the new candidate in a strong seat which might be a National seat or a Labour seat. He or she is a candidate who is put at the back of the party list for one reason or another. It brings back a sense of déjà vu I might add. In Napier we have a seat that was a Labour seat with a majority of 11800 in 1999. That was achieved when Michael Cullen was still within the seat of Napier. In 2002 Anne Tolley brought that majority back to 4500 despite a swing against National. Michael Cullen was still in that seat and that was achieved. The candidate did an amazing job bringing it against the swing back from 11800 to 4500. At the 2005 election— 
Hon Dr Michael Cullen 
: I raise a point of order Madam Chairperson. I did not stand in the Napier seat and never have done. 
The CHAIRPERSON (Ann Hartley) 
: That is actually a debating point. 
CHRIS TREMAIN 
: No one ever said that that member was standing in the seat of Napier; he was resident in the electorate of Napier. I would imagine that having the Deputy Prime Minister resident in the electorate of Napier would have some influence over the residents of that community. Obviously that was not the case with the vote going from 11800 to 4500 and then to a loss of 3600 for Labour. 
I want to come back to the junior candidate. Our president reminded us time and time again that there was a standard level of money that we could spend—$20000—and we could spend it only in the 90 days before the election. We had to authorise everything make sure our logos were fine but spend only $20000. Even with those rules it is not a fair playing field and I accept that; the power of incumbency is huge. If someone is an electorate MP the advantage is massive. That person has all sorts of things in his or her favour: an office a motor vehicle and staff. The playing field is not fair and I accept that. I accept that incumbency factor. I was happy to take on the underdog status. It is a bit like the Hawke’s Bay rugby team taking on Waikato this year or taking on Wellington Canterbury and Auckland; that team was the underdog. But the difference was that when that team took on those other teams the rules were the same for both and the teams expected to play on an even playing field. However that was not the case for me when I came in as an underdog candidate into the Napier seat that previously had had 11800 as its majority. 
It was not just the incumbency factor that I had to put up with. I could have accepted the benefits of incumbency for the sitting MP but on top of the $20000 another candidate is up against a whole lot more. We turned up to campaigns at the Eastern Institute of Technology where there were literally hundreds of pens with the parliamentary crest on them being handed out to the young students. At candidate meeting after candidate meeting that we went to these pens with the parliamentary crest on were being handed out. On top of that there were newsletters coming out. Dr Cullen would have received into his own letterbox A4 newspaper pages out of the  
Napier Mail 
 funded by Parliamentary Service in those last 90 days. How is that fair? How is that fair—accepting the benefits of incumbency—to a new candidate coming into that situation? On top of that the pledge card came out at the same time. There was $800000 of advertising all funded by Parliamentary Service and all working against the new candidate. 
New Zealand has a sense of fairness. We understand that incumbency carries advantages but we want a fair playing field. We want the underdog to have a chance just like the Hawke’s Bay rugby team that stood up against Auckland Waikato and other teams around New Zealand. That team had a tough field to play on but when the two teams got on to the field in these games they were playing by the same rules. On a number of occasions Hawke’s Bay actually stood up against the odds and beat those champion teams. That is what the National side of the Chamber is calling for—fairness. 
We accept that an incumbent MP has an advantage; we have to accept that. But when we get into the final stage of the election process there needs to be fair rules for new candidates coming in. That is why National members stand for that fairness. That is why I challenged Dr Cullen to stand against me in the seat of Napier at the next election to have a crack at Napier to put his bill to the test and to see whether he could win the seat of Napier back for his party. Unfortunately I have news that may be bad news or it may be good news; he did not take up the challenge and is not prepared to have a go. Thank you very much. 
NICKY WAGNER (National) 
: 
 I rise to speak to clause 4 “Expiry”. If Labour is going to force this bill through I want it to expire as soon as possible. I have presented 31 amendments on the expiry clause and those 31 amendments have 31 different dates. They start from 1 January 2008 and go through to 31 January 2008. The reason I picked 1 January is that it is a significant date; it is the day that the Electoral Finance Bill comes into play. In that legislation we have something that threatens our democracy in New Zealand. It is probably the biggest threat we have ever had to democracy. It is a double jeopardy to freedom of speech and possibly to good government. It is probably the greatest threat in our history. 
The Appropriation (Continuation of Interim Meaning of Funding for Parliamentary Purposes) Bill is absolutely bad enough by itself. It should not exist at all. Labour is very keen to tell us that this bill is nothing much and just restores the conditions that existed before the Auditor-General’s review of parliamentary spending in the 2005 election. That is blatantly untrue. This bill will make the spending that is best epitomised by Labour’s pledge card and also any form of soft electioneering quite acceptable and quite legal. That was definitely not legal before the Auditor-General’s review. Parliamentary spending for electioneering has never been allowed. It cannot have been legal before the Auditor-General’s review; otherwise he would not have rejected it. 
The public of New Zealand those beyond the beltway contrary to the Prime Minister’s belief were appalled when Labour expected them to pay for its pledge card. The public felt very strongly that Labour’s propaganda and spin should be paid for by Labour and they fully supported the idea that Labour should pay the money back. Does this Government really believe that in 2008 the public will suddenly have a change of heart? Why do Labour MPs think that they have the right to pass legislation that the people of New Zealand have very strongly indicated they do not want? Not only should this bill expire as soon as possible but Labour should never have insulted the public of New Zealand by even proposing it. 
Labour is very keen to assure the people of New Zealand that this is only a temporary bill. Yes temporary—with its original date it expires in June 2009. It exists only for long enough to give Labour a crutch to try to win the 2008 election. So there is no comfort to the public in this type of “temporary”. This bill expires not because Labour has suddenly got a conscience but because it will have had the benefit of the taxpayer’s money to campaign for an election that it is desperate to win. 
MOANA MACKEY (Labour) 
: 
 I move  
That the question be now put 
. 
ANNE TOLLEY (National—East Coast) 
: 
 I rise to speak on clause 4 of this insidious bill the Appropriation (Continuation of Interim Meaning of Funding for Parliamentary Purposes) Bill. I want to refer back to the Minister of Finance’s speech. I just want to point out to him before I start that if a member was elected in 1990 and we are now in the year 2007 that actually adds up to 17 years. It is a bit of a concern when even the Minister of Finance cannot add up. 
The essence of the debate around this insidious bill is that it creates separate rules for members of Parliament from those for the general public or for a candidate who is not a member of Parliament. My colleague Chris Tremain talked of his experiences as a candidate in the last election. I want to make it clear to the Committee when we look at this material here. We see that the red printing machine has been out in force. We have all this sort of material going out. That is not a problem. That is quite within the rules. It is happening outside an election year and it is all funded by the leader’s office. 
The material is talking about what the Government is doing—for example  
Supporting Kiwi Business 
;  
Healthy Wealthy and Wise 
; and  
Enhanced KiwiSaver: Investment for a Sustainable Future 
 etc. There is also a report by Trevor Mallard from Hutt South on anger management. That is not a problem. There is nothing wrong with that. Come election year—and under the new Electoral Finance Bill come 1 January next year—this material with the parliamentary crest on it will be OK if it is funded by the Labour leader’s office. A Labour member who is a candidate standing for Labour can also under this bill put out this sort of propaganda and it will be within the rules—not a problem. But a candidate standing against that Labour member putting out similar stuff with no parliamentary funding will have to count it in his or her election expenses. 
That is what is not right about this bill we are debating tonight. That is what is so insidious and invidious about what this Government is doing by setting up one set of rules for incumbents—for political parties in Government and in Parliament and for MPs who are currently holding seats—and discriminating against even its own party’s candidates in terms of what they are able to put out around the electorate. 
If an MP has a budget of $65000 if he or she is an electorate MP on top of that he or she will have another $20000 to spend as a candidate. It will be under a different set of rules so he or she will be managing two budgets with two different sets of criteria and two different sets of rules. That candidate will be up against another candidate out in the field with only $20000. That will be the case for a whole 12 months. 
This bill before the Committee tonight will extend those rules through into the middle of 2009. One has to ask what is so special about 30 June 2009 other than the fact that it is the end of a financial year for an MP. Why would we choose 30 June? Is it an arbitrary date? We do not know. Of course if there had been any sort of cross-party discussions of any meaning whatsoever around this legislation then we would understand. Other than a couple of meetings between chiefs of staff which did not begin until the end of September—they have not as the Minister of Finance the Deputy Prime Minister implied been happening all year—there was no cross-party discussion all year. There were two meetings—two discussions between chiefs of staff from the end of September. If there had been any sort of cross-party talk maybe we would understand what this expiry date of 30 June 2009 signifies. 
National does not believe that this legislation is needed at all. The rules are clear. Every other person in this country if he or she breaks the rules has to learn to change his or her behaviour. That person gets punished and he or she has to change his or her behaviour to abide by the law. The Labour Government broke the rules at the last election. It should have been punished more than by just having to hand back the money it had stolen from the taxpayer. Labour should have been prosecuted for breaching the electoral spending cap. It was ineptness on the part of the police that Labour was not punished. Labour should have had to change its behaviour not the rules. 
JILL PETTIS (Labour) 
: 
 I move  
That the question be now put 
. 
A party vote was called for on the question  
That the question be now put. 
Ayes 66 
New Zealand Labour 49; New Zealand First 7; Green Party 6; United Future 2; Progressive 1; Independent: Field. 
Noes 53 
New Zealand National 48; Maori Party 4; Independent: Copeland. 
Motion agreed to. 
The question was put that the following amendment in the name of the Hon Dr Michael Cullen be agreed to: 
to omit “30 June” and substitute “1 July”. 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 66 
New Zealand Labour 49; New Zealand First 7; Green Party 6; United Future 2; Progressive 1; Independent: Field. 
Noes 53 
New Zealand National 48; Maori Party 4; Independent: Copeland. 
Amendment agreed to. 
The CHAIRPERSON (Ann Hartley) 
: There were amendments in the name of Nicky Wagner. These have been ruled out of order as being inconsistent with the previous decision of the Committee. 
A party vote was called for on the question  
That clause 4 as amended be agreed to. 
Ayes 66 
New Zealand Labour 49; New Zealand First 7; Green Party 6; United Future 2; Progressive 1; Independent: Field. 
Noes 53 
New Zealand National 48; Maori Party 4; Independent: Copeland. 
Clause 4 as amended agreed to. 
Education (Tertiary Reforms) Amendment Bill 
In Committee 
Part 1 Amendments to Education Act 1989 
Dr PAUL HUTCHISON (National—Port Waikato) 
: 
 This bill is very important because undoubtedly tertiary education is vital for the country in every way. It is important in terms of the economy in terms of future productivity—something that has been lacking under the Labour Government over the last 7 or 8 years—and in terms of citizenship. 
Part 1 is the machinery of the bill and the Minister described it as bringing in a new era of high trust and of low compliance. He said it is about quality relevance and value for money. Sadly the very opposite seems to have occurred. In fact he talks about streamlining yet we have already heard from right around the country as the 13 investment managers and the 13 stakeholder engagement managers spread themselves out that more and more hurdles are occurring. In fact I heard from one of the tertiary education institutes just recently that an investment manager said to it: “Look if you don’t play ball we won’t sign off the plan with you.” Is that is an indication of the high trust? No it is centrally controlled threats and that is totally the opposite of the ethos that Dr Cullen started with when he began to plan for this bill. 
I do want to say that the select committee members worked extremely well together. This bill was so bad when it was first introduced that it needed a whole lot of work. I also want to commend the officials for their wonderful report. It was beautifully set out. The bill is a very complex bill but they set out their report magnificently and clearly and described the various contentious areas that are encompassed particularly in Part 1. These areas relate to charters procedural fairness treatment of sensitive information and the adult community education amendments. Of course the most controversial area—where we will go back to the purpose clause—is the issue of academic freedom and institutional autonomy which the Labour Government has tried so hard to trample over. 
Nevertheless we are talking about Part 1 today and I hope that the Government is appreciative that I have tried to help it all I can. Even though National is opposing this bill we have brought in a very well-thought-out Supplementary Order Paper to try to see whether the Government can see some sense as to the error of its ways. Undoubtedly it is important to have high trust in the tertiary education system and it is extremely important to diminish the bureaucracy that has built up so logarithmically over the last 7 years under Labour. From a department within the education department of 16 or 17 people there is now a steaming group of 340 in the Tertiary Education Commission— 
Anne Tolley 
: How many? 
Dr PAUL HUTCHISON 
: There are 340 staff and just recently appointed as fast as the commission can get them are those extra 13 investment managers and 13 stakeholder engagement managers I was talking about earlier on who appear to be very variable in their ability to engage or invest. I have heard from some institutions that many of those managers are not very comfortable in dealing with financial investment and when organisations are as complex as the tertiary education institutes it is hugely important to have highly competent people. In fact the OECD in its report this year said that one of the things about the tertiary education system in New Zealand is its complexity and this bill adds even more to its complexity. 
Dr ASHRAF CHOUDHARY (Labour) 
: 
 I rise to speak briefly to the Education (Tertiary Reforms) Amendment Bill because it is a fantastic bill that is designed to reform the system for planning funding and monitoring the provision of the tertiary education system. 
Clearly this Government is committed to quality education. Under this bill the Government is clearly moving from the “bums on seats” system to a quality education system and we are committed to quality tertiary education that is relevant for today’s New Zealand economy and social well-being. This bill will provide a tertiary system that will better fulfil New Zealand’s needs yet at the same time give better value for money for taxpayers and students. Clearly this bill allows us to move away from the annually funded demand-led system to a system funded 3-yearly which will be a much better way of giving stability to our education system so that teachers lecturers and students can be surer of the courses they are following. The bill will also streamline the processes supporting the operation of the tertiary education system in New Zealand thus strengthening the stakeholders involved. 
I totally support this bill. We had a good discussion at the select committee where we had a lot of input from the tertiary education sector and stakeholders and the committee made quite a few changes to the bill that clearly made it much better. With those few words I commend the bill to the Committee. 
COLIN KING (National—Kaikoura) 
: 
 The bill we have in front of us was certainly a challenge to the Education and Science Committee and we must acknowledge during this Committee stage the wisdom and advice we had from submitters. When we stop to think about tertiary education we realise that it covers an enormous range of provision right through from our Gateway programmes to university courses at the other end of course like PhDs and suchlike. 
But in the middle we have such things as the Tertiary Advisory Monitoring Unit and the New Zealand Qualifications Authority and it is on that basis that when we look at this Education (Tertiary Reforms) Amendment Bill we start to understand that a bill of this particular nature will not change an awful lot. In actual fact when we put it up and measure it against the performance of what we have had to endure in tertiary education over the last 8 years we start to realise that it will take a lot of work to get the tertiary education programme back on track. 
Part 1 of the bill deals with a whole range of situations. As the previous speaker Ashraf Choudhary alluded to it is meant to change the efficiency and productivity of tertiary education and increase the return to the Government and taxpayers of the money invested in it which is some $3 billion. However to put it bluntly the Labour Government has completely butchered this sector time and time again. In actual fact when we come to look at the productivity gains inside New Zealand against those of OECD countries we find that our productivity gains have been very very poor. 
The purpose of this bill to unravel the complexities but unfortunately the opposite is the case. When we look at what the  
Education Review 
—which is quite a laudable publication that keeps us all up to date—says about the growth of tertiary education we see as my colleague Paul Hutchison has told us here in the debating chamber that the Tertiary Education Commission has grown to comprise some 340 members. The  
Education Review 
 gives reasons for this being the case and states: “The Tertiary Education Commission Communications Manager Andrew Bristol said that the number of the staff paid more than $100000”—which incidentally has increased from some 20 to over 50—“increased because the commission had a far different role to play compared to when it was first set up. The new method of investing in tertiary education requires the appointment of more senior people with specific skill levels.” Unfortunately we have seen a proliferation in the number of those members. That has had another effect on the other side when we look at the structure of it all because the institutions themselves have become bogged down in it. 
Inside all of this we have the New Zealand Qualifications Authority. That is dealt with in Part 1. The authority is to set up a quality assurance programme yet we find it working at a snail’s pace. In actual fact I was disappointed to learn today that after the debacle and fiasco around the Plumbers Gasfitters and Drainlayers Board and the industry training organisation stand-off in the Hazel Armstrong inquiry the new qualifications have not been approved. It is hoped they will be approved in January 2008. That is an indication of what we are working with here and I do not think that a bill of this nature which came to us with very draconian wording in it will address this issue whatsoever. 
One of the major issues we really are confronted with in legislation of this nature as laid out in Part 1 is that it will stifle quality. What we saw down in Christchurch with the Southern Institute of Technology—a very very successful model of what a polytech should be doing and accomplishing—was that that institute lost $8 million worth of equivalent full-time student funding because of being more competitive more efficient and in fact having more people coming to it for quality education than the Christchurch Polytechnic Institute of Technology. What we are actually seeing unfortunately is that this bill is stifling initiative. It is stifling quality of education and that is not good for the tertiary education sector. 
ALLAN PEACHEY (National—Tamaki) 
: 
 I am pleased to have the opportunity to speak to Part 1 of the Education (Tertiary Reforms) Amendment Bill. Right at the very outset I want to make the point that the Education and Science Committee really faced a massive challenge in working its way through this proposed legislation. I think the select committee was very very fortunate on two counts one being the quality of the advice and the guidance—and I have to say the forbearance and the patience—that the officials brought to the task. It could not have been easy for them either. But finally we got through it. 
The second acknowledgment I want to give in addressing Part 1 is to the leadership provided by National’s own tertiary education spokesperson Dr Paul Hutchison. He brought a detached thoughtful and reflective approach to the debate—not helped I have to say by some of the members opposite—and this brought a bit more common sense and structure to what were when the bill was first presented to the committee some pretty loose untidy assertions on the part of the Minister. 
Life is interesting. It has a way of going round in circles and I think that Part 1 clearly demonstrates that. The bill is trying to clean up a mess that was initially created by the Minister responsible for the Tertiary Education Commission at the time a Mr Maharey. He left tertiary education more unsettled and more confused than he found it and that is what tends to happen with the left in New Zealand politics. So they put in Dr Cullen the man who had already lost control of financial policy and the man who—it is increasingly obvious—does not know what to do about for example taxation and they told him to get in there and fix tertiary education. This bill is the result. 
If we look through Part 1 we realise just how bereft of sound original thinking this Government is. What is in the minds of the members opposite that makes them think that the best way to get quality is to create massive bureaucracies? What was wrong with the New Zealand university system when a couple of people sat around a table in the old Department of Education? Now we are talking about—is it 380 people? 
Colin King 
: 340. 
ALLAN PEACHEY 
: I must get it right. I would not want to be accused of exaggeration. That is a hugely increased number of people. Why is this bill making it so expensive to administer the tertiary education system? 
One of the other problems we get is that left-wing Governments bring with them a sort of massive crashing club in their approach to issues they are trying to deal with and nothing illustrates that better than the tertiary education issue. When I look at Part 1 I have two thoughts. Firstly where is the trust? Why does this Government not understand that one gets the best results from high-trust models? 
Jill Pettis 
: Is this the National Party’s policy on tertiary education? 
ALLAN PEACHEY 
: Goodness gracious me is that the defeated member for Whanganui? I think it might be. Well the people of Wanganui decided they had no interest in her views and I certainly have no interest in her views on tertiary education reform. As I was saying this is not a high-trust model. I looked at the vice-chancellors and the chancellors who came and presented very well before the committee and I could not help but reflect that when they were asked the question: “Is this legislation so seriously flawed that it should be dumped and we should start again?” their body language was interesting. 
Hon BRIAN DONNELLY (NZ First) 
: 
 National members cannot have it both ways. Prior to the last election they had a field day over the excesses of 5.1 funding the singalong courses and the twilight golf courses which actually came about as a result of the uncapping of the equivalent full-time student numbers in 1998. Who was it that uncapped the number of equivalent full-time students in 1998? The consequences of that were first the blowout in the number of equivalent full-time students used by the private training establishments which Labour then put a totally artificial moratorium on. Then there was the blowout in the polytechs and institutes of technology. Then National members had the gall to say: “What we want to do is get rid of any bureaucracy. Let’s go back to ‘bums on seats’ and the uncapped EFTs.” I am sorry but those members cannot have it both ways. 
In this particular case it is the second tranche I guess of the reforms that Labour has attempted to put in. The first one failed somewhat because some of the funding mechanisms were left in place by the former Minister. When Maurice Williamson travelled to Finland and Ireland and studied their tertiary education systems he said that he met up with people who said: “If you plan you are almost certainly not going to get it right. But if you don’t plan you absolutely are not going to get it right.” That is what occurred with the “bums on seats” situation. There was a misalignment. This bill the Education (Tertiary Reforms) Amendment Bill is attempting to achieve some alignment. 
I would be the first to agree that the bill is more heavy-handed in terms of bureaucracy than what existed in the past but we have to look at what occurred as a result of the light-handed bureaucracy in the past. Mr Peachey asked what was wrong with two people sitting in the department running our universities. Well there was only one university in New Zealand then. Members may recall that it was called the University of New Zealand and it was set up in 1876 at the request of Canterbury much to the chagrin of Dunedin. Of course there were a lot fewer students and it was a lot less complex sort of a world. If that is what National wants to take us back to then it really does have a dinosaur policy on tertiary education. I continue to ask this question which I cannot get an answer to: if National gains the Treasury benches will it repeal this legislation? Would it reverse these reforms? National members cannot seem to tell me that. There has been speaker after speaker but no one will address that simple yes or no question. 
I would be the first to admit that the members of the Education and Science Committee worked constructively although from time to time we did have to point out one or two of the basics to Dr Paul Hutchison. For example even when this bill has gone through academic freedom and institutional autonomy will still be protected because it was in the Act anyhow in a different part. In fact we went so far as to say “Let’s just confirm that this is in the other part of the Act as it has got to be considered in this part.” 
What I mean when I say that National cannot have a bob each way is that Dr Hutchison has put up some amendments one of which I would like to talk to because I think it has some merit but the other amendments actually create more bureaucracy. They require even greater levels of consultation and they try to prescribe to the Minister all of the different groups he should be consulting with when at the same time Dr Hutchison says that this measure is too bureaucratic. The North American native indigenous people used to call it talking with a forked tongue. 
The area in which there is some merit—and I think it is a 50:50 call from New Zealand First’s point of view as to whether we will support it—is the amendment about commercially sensitive information. I would like to take a call later if I could to go through this in a bit more detail because I believe it needs explanation. I think that in this particular case there is some merit in the amendment on that particular issue set out on Supplementary Order Paper 161 which is in Dr Hutchison’s name. I am not saying at this point in time that we are going to support it but I can say that I think there is an issue around this one. 
MOANA MACKEY (Labour) 
: 
 I move  
That the question be now put 
. 
Dr PAUL HUTCHISON (National—Port Waikato) 
: 
 I appreciate the opportunity to take this call and I hope that we will have time to spend on Part 1 because it is very very important. One of the basic aims of the Education (Tertiary Reforms) Amendment Bill was to make the planning of tertiary education institutions more streamlined by cutting down on charters and profiles and replacing them with a 3-year investment plan. 
That sounds great in theory but there are a few ironies about this aim one of them being that the universities were anxious to hold on to their ability to retain a charter. They felt that a long-term plan that was signed off and given the tick of the Minister would be very useful to them in terms of having a link with the Minister. They felt that that association would give them an extra bit of security in terms of their direction. 
I guess the other irony is what has turned out. The very good summary that the department has provided points out that plans are developed by the tertiary education organisations. Although the plans must satisfy the requirements set out in clause 17 of this bill tertiary education organisations are not prohibited from including in their plans information to satisfy their own purpose—for example long-term planning. However the summary then goes on to state that in some instances tertiary education organisations may be required to provide the Tertiary Education Commission with evidence of long-term planning. 
Under clause 17 of the bill new section 159R states that the Tertiary Education Commission can require types classes individuals or tertiary education organisations to provide supplementary information. In actual fact that supplementary information may be short-term planning medium-term planning or long-term planning. So in effect the Tertiary Education Commission may require almost anything in the way of planning. 
I am very sceptical about whether the basic idea of a simple 3-year plan replacing the charters and profile will work out under this Labour Government in actuality. I think there is a very very slim chance. Because as I have said I have heard what is happening right around the country—about the threats by the investment managers to the tertiary education institutions that they will not sign off plans unless the institutions are prepared to reduce the number of equivalent full-time students or whatever. 
Let us look at the polytechs. “The polytech cuts start to bite” is one of the headlines in the  
Education Review  
of 14 September. We have heard for instance that the Southern Institute of Technology has been cruelly cut down on the number of equivalent full-time students for next year—something like 2500. I say “cruelly” because the Southern Institute of Technology is one of the best-performing institutions in this country. Quality relevance and value for money is what it has aimed for yet the centrally controlled Tertiary Education Commission under the Labour Government says that it will penalise the successful institutions and that the institutions cannot provide education in Christchurch because they are actually making it too hard for the incumbent to be able to survive so they have to move away from there. 
This is grossly unfair particularly when it is inconsistent with what the universities are doing. I would defy Dr Cullen or the Tertiary Education Commission to start doing the same sort of thing to the universities. Can members imagine if the Massey University campus up in Auckland was told that it was out of region and to go down to Palmerston North or likewise if the Otago University campus up here in Wellington was told that it was out of region and to go down to Dunedin. 
The commission has started with the weakest institutions. What it should be doing is concentrating on who can provide quality provision at the best price. It is doing the very opposite. 
JILL PETTIS (Labour) 
: 
 I move  
That the question be now put 
. 
The CHAIRPERSON (Ann Hartley) 
: No we have a couple more speakers. 
KATHERINE RICH (National) 
: 
 It is an honour to speak to Part 1 of the Education (Tertiary Reforms) Amendment Bill. 
First of all I think it is worthwhile asking the Minister in the chair Maryan Street why after 8 years and over half a billion dollars of expenditure we are looking at tertiary reform only now. If one looks at Labour’s history back in the 1998-99 campaign one sees that it said it was going to make changes to the tertiary sector. Up until this point there has just been talk expenditure and change and many people do not agree that this measure is going to make a skerrick of difference to students up and down the country. 
My colleague Paul Hutchison and I went to a presentation put on by the Tertiary Education Commission. We said that our Education and Science Committee was looking at the tertiary reforms and we asked for a blow-by-blow account of exactly what this piece of law would do in terms of its impact on universities. We heard the presentation which tended to go along the lines of blah-blah stakeholder engagement blah-blah charters and profiles blah-blah investment reducing duplication. We have all heard the discussions that occur when we talk about tertiary reform. But in the end we said: “Well if you can give us an example what exactly will be the difference for Auckland University?”. There was a long pause before someone said: “Oh actually there’ll be very little change as a result of this reform. It’ll be business as usual.” So we thought that it was probably not a bad thing for universities because nobody has had much of an issue with them. 
But when we started to look at the nuts and bolts of this bill and the proposed changes we started to have deep concerns about some of the changes. The Minister for Tertiary Education at the time said that this bill was designed to reduce bureaucracy increase transparency and look at better investment in tertiary funding. A lot of the universities and a lot of other tertiary providers said it was good to reduce red tape reduce the amount of reporting and reduce the thousands of dollars they spend on useless red tape and bureaucracy. When we looked at this bill we found that the bill gets rid of charters and profiles but then it suddenly brings in a whole new layer of accountability and a whole new section on planning. The tertiary provider not only has to put in place planning in the short term which of course we all expect but also is asked to do a medium plan and perhaps a long-term plan as well. So rather than just preparing a charter and profile—which cost some universities hundreds of thousands of dollars to produce and will now be parked—the tertiary providers are going to have to start again and put out a long-term plan for up to 10 years. Well I challenge the Government—any Government—to have a plan for 10 years because things change so dramatically. We cannot expect our tertiary providers to have a crystal ball so that they can plan exactly what they will do vis-à-vis courses etc. in 10 years’ time. So the National Party has some concerns that this bill seeks to take away some bureaucracy only to bring back a whole new set of changes that will be equally burdensome if not more so. 
The other issue that I think is addressed in relation to Part 1 is academic freedom. Most of us were shocked at the second reading the other night to hear a member from Labour say that when universities receive 60 percent of their funding from the State it is a bit rich to expect full academic freedom. Well I think that will be a huge shock to many in academia and I think the Minister should explain some of the changes that have been made in relation to that. I would also like to hear how the changes make it easier for universities. How do they make universities and other tertiary providers’ jobs easier or are they just introducing another layer of bureaucracy which will be equally costly? 
I think there is a lot of discussion about plans. In fact “plan” is the most overused word in this bill. In an attempt to reduce the amount of resources attached to planning and strategising it actually introduces far more planning and strategising than anybody ever envisaged when the tertiary reforms began. 
Hon MARYAN STREET (Associate Minister for Tertiary Education) 
: 
 I rise to take a short call on Part 1 in response to some of the points raised by the National Opposition in respect of the Education (Tertiary Reforms) Amendment Bill. 
The bill does use the word “plan” a lot as the member who has just resumed her seat said and we make absolutely no apology for that. Tertiary education ought to be planned it ought to be considered carefully and it ought to be engaged with by stakeholders. That is the framework and the upshot of this bill. As a result of this bill we will have a new system for planning funding and monitoring the provision of tertiary education. 
There are some significant changes. It will be a system that is no longer demand-led it will be a system that is no longer based on inputs and it will no longer be a system with a 1-year planning and funding cycle. Spreading the plan the funding and the organisation across 3 years provides a level of security and continuity and that allows tertiary education organisations to proceed with their business. So the new system is built on a plan and it lasts for up to 3 years. The plans are developed owned and maintained by each of the tertiary education organisations. The people who have an interest in the offerings of those tertiary education organisations will be encouraged. In fact there will be a requirement that they are consulted and talked to in the course of the development of programmes and in the implementation of the plan. 
A key feature of this process is its flexibility. The contributions we have had from the Opposition have implied that a layer of stultifying bureaucracy will be applied across the top of these organisations. In fact the opposite is true. The bill does establish plans but it contains a number of provisions for those plans to be reviewed amended and replaced as needed through a collaborative process. There is some flexibility built in. 
I would like to make a couple of comments especially about clause 3 which has been amended to make clear that the principle of academic freedom is completely unfettered by the amendment bill. I welcome the reassurance that this will provide to academics in tertiary institutions. Although that provision was already present in the legislation this provides additional reassurance and demonstrates that academic freedom is in no way jeopardised by these reforms. 
The part currently under consideration does the bulk of the work in this reform bill. It sets out the legal mechanisms that allow for the plans which I have already referred to to be developed and approved then changed if need be. It sets out the mechanisms that the Tertiary Education Commission might use to monitor the performance of tertiary education organisations. That is right and proper. It is also important to note that there is no prohibition or control. The repeated notion that the Government represents some sort of commissariat that dictates what is taught completely misrepresents and distorts the function of the Government. Of course if a programme offered in a tertiary education organisation is funded by the Government the Government through the Tertiary Education Commission is responsible for ensuring that the courses are delivered as they are meant to be. The commission has no reach over programmes that are not funded by the Government. 
I refer to Supplementary Order Paper 161 in the name of Dr Paul Hutchison and respond to some of the points he made earlier. As much as I admire Dr Hutchison and take no exception to him as a person in any way the Supplementary Order Paper is completely redundant. It is a second bite of the cherry it seems. The very points that the member raises have already been disposed of by the Education and Science Committee. The National Party is having another go at what did not make it through the process of the select committee. The issues around the shape of consultation requirements on tertiary education organisation plans the publication of the tertiary education strategy the reasonableness of Tertiary Education Commission decision-making and the potential exposure of commercially sensitive information have all already been addressed. Dr Hutchison’s amendments are considered to be unnecessary repetitious and altogether unhelpful which is why the Supplementary Order Paper should fail despite the niceness of the member who puts it forward. 
COLIN KING (National—Kaikoura) 
: 
 It was good to hear the Associate Minister for Tertiary Education explain some of the details that the Education and Science Committee spent months and months working our way through. It is good to know that the Minister has some understanding of the challenges that the committee had to face. 
But for just a moment or two I would like to talk about Dr Paul Hutchison’s Supplementary Order Paper 161. I point out to the Minister that the reinforcement of academic freedom was put in clause 3 only at the very last moment. It is a bit like the requirement that information be supplied to the Tertiary Education Commission before funding is granted. Listening earlier to the chairman of the select committee gave me some confidence that he too is aware that under closer examination there are some problems with that ability of the Tertiary Education Commission to demand information before funding is given. I see the risk emanating from the point of view of how it appears to a person on the outside—a partner or a joint-venture client who may be entering into a research programme. Such people will look at the requirement and decide on balance to go with a university that can guarantee them categorically that there is no spectre of confidential information being disclosed. It is on that basis that the National Party is particularly concerned about that requirement. 
As I mentioned in the second reading debate our eminent member Dr Paul Hutchison is ever ever aware of—and is probably the most well-informed person in this Committee about—the alignment that is necessary between universities and the science fraternity. It is something that we really have not done very well. That probably highlights the attitude of the Tertiary Education Commission and the angle at which it is approaching this whole thing. It is approaching effectively to put it in simple terms an issue around delivering skills and trade training at institutes of technology and polytechnics—low-level diplomas certificates and some degree-level qualifications—that is about managing quality yet we have actually roped in the universities and have done it under the view that they will do as we say. They will not be able to be heard around any sensitivities. With this particular provision in Part 1 I believe we are putting at risk a lot of the commercial science arms of universities. I want to make that particular point. 
I now want to move on to a point about quality. Clause 14 includes section 159KBA “Monitoring and reporting function of chief executive in relation to institutions”. I draw the Committee’s attention to a review that was done recently and resulted in  
Review of the Operation of the Tertiary Education Institutions at Risk Legislation 
. It deals with sections 195A to 195F of the Education Act. I think it is necessary for the Committee to be aware that from my working through this bill it will go nowhere near tidying up this problem. The report talks about the Tertiary Advisory Monitoring Unit and its responsibility but in terms of the auditing process that happens every 5 years it states: “… TEIs should also be measured in terms of the quality of education provision. … In the longer term it may be appropriate to review the current criteria …”. Then we go to section 46 of the report which states: “It is likely for example that as part of the Investing in a Plan process the TEC will have more tools to support TEIs to respond to the difficulties they are facing by providing the right kinds of incentives to encourage good performance.” 
That is quite an indicting statement. It is an indictment that after 8 years of Labour Government we have a comment from the auditing body of standards of education inside the tertiary education sector about providing “the right kinds of incentives to encourage good performance.” The right kinds of incentives are not in the bill. I think that is a point that is well worth being made. 
Hon BRIAN DONNELLY (NZ First) 
: 
 I take a call just to stress three points. The first is the point about academic freedom. I have to say that the Opposition has this totally wrong. There is no change to the Act in terms of the protection of academic freedom and institutional autonomy. 
Dr Paul Hutchison 
: I raise a point of order Mr Chairperson. We are actually debating Part 1. The academic freedom part is dealt with in the purpose clause and is actually not relevant to Part 1. 
Hon BRIAN DONNELLY 
: Speaking to the point of order Mr Chairperson I note that the Opposition speakers have been referring to academic freedom and institutional autonomy all the way through their speeches. I am responding to their speeches. 
The CHAIRPERSON (Hon Clem Simich) 
: Thank you. 
Hon BRIAN DONNELLY 
: I wish to make the point which is quite simple that references to those two concepts are still in the Act. This bill makes no change to them except to strengthen their protection. That was explained to the members of the Education and Science Committee time and time again. 
I also want to make a point about charters. There was a sector that wanted charters but it flowed over into the polytech sector as well. Universities can still have their charters. There is nothing in this legislation that prevents them from having charters. The problem is that they came along and said they have to have institutional autonomy but that they also want to have those 10-year charters signed off by the Minister. The whole thing contradicts itself. 
What the committee said was that long-term planning is good governance practice and we would expect that all tertiary institutions would have in place some form of long-term planning vision statements etc. But we said we would leave it up to the institutions themselves to devise what works for them. So small private training establishments might have a totally different need from say a large institution like Auckland University which may decide that it will stick with the charter that it has spent money on. I want to make clear that the select committee said that we will put in place something requiring long-term planning but we did not prescribe what form it was to be in and it certainly was not to be signed off by the Minister. 
The third issue is around the notion of commercially sensitive information. Clearly the Tertiary Education Commission has a responsibility—and it is spelt out in the Act—to continually monitor the financial risk of the institutions themselves. That is prudent. Why would we be putting literally tens of millions of dollars into an institution that was going to go belly up in the next week? We need to have some sort of guarantee that the institution is not engaged in some foolhardy scheme that will turn the whole thing to custard. So the Tertiary Education Commission requires information beyond just purely and simply the information around those programmes for which the institution is seeking money. But the question is whether the Tertiary Education Commission requires information that burrows down deep enough to be commercially sensitive information. 
The problem brought to our attention—and I think it was a genuine problem—was that if universities for example had to reveal all their contracts then they could not give that information because they would have already signed contracts not to reveal it to anyone. Commercially they would be breaking their deals right from day one. But secondly their concern was that the Tertiary Education Commission also comes under the Official Information Act as do universities. The Tertiary Education Commission told us that it could refuse information that was commercially sensitive. The universities responded by saying: “But they might not know what is commercially sensitive. We do.” and that was a very very good point and a valid point. 
We asked the officials to go away and look at this matter seriously and it was confirmed to us that the level of detail of information that would be required by the commission in order to be able to do its monitoring function was at nowhere near the level that would require commercially sensitive information on research contracts etc. and even if it was required—and the officials said it would not be—and the commission got an Official Information Act request on it the commission would first go back to the institution and ask it what its opinion was under the protected disclosures provisions under the Official Information Act. 
Therefore I have to say to the Committee that I am not too certain about the tidiness of the language that is used in the bill because it is really about that commercially sensitive information that is protected under the Official Information Act. That part is what really is relevant in terms of the amendment that Dr Paul Hutchison has put forward. I think it is a genuine attempt and I will not lambaste him for it. It is still an issue that we are not 100 percent comfortable about and it is a line call for us at this point in time. 
Hon DARREN HUGHES (Deputy Leader of the House) 
: 
 I move  
That the question be now put 
. 
NATHAN GUY (Junior Whip—National) 
: 
 I raise a point of order Mr Chairperson. Under Standing Order 137(3)— 
Hon Member 
: What does that say? 
NATHAN GUY 
: It talks about closure motions. If there is a lot of interest as there is in this debate on Part 1 it is over to you to decline it Mr Chairperson. I urge you to consider that there is a lot of interest in the debate and many members are seeking calls. 
Hon DARREN HUGHES (Deputy Leader of the House) 
: 
 The member’s knowledge of the Standing Orders is impressive and delightful but the most important arbiter on this is you alone Mr Chairperson. The motion that I have put is not a debatable one but that is what the member has now sought to do by—[ 
Interruption 
] A member is now interjecting on my point of order as well. So maybe Mr Chairperson you could also tell Mr Bennett some of the rules of Parliament. But this is not a debatable motion. The motion is put and you either accept it or do not accept it and your decision should not be challenged by any member in Government or in Opposition. 
The CHAIRPERSON (Hon Clem Simich) 
: I thank Mr Hughes for his assistance. I do not need any more assistance on this one but I think that the Committee would like to hear from Te Ururoa Flavell. 
TE URUROA FLAVELL (Maori Party—Waiariki) 
: 
 I appreciate very much being given the opportunity to speak to Part 1 of the Education (Tertiary Reforms) Amendment Bill particularly because the Maori Party has some proposed amendments. I thank you very much Mr Chairperson and I appreciate the opportunity to be able to speak to them—and I am sorry for being a little late to do it. 
During the last big reshuffle of the tertiary education sector which saw the establishment of the Tertiary Education Commission and the introduction of charters and profiles the Ministry of Education released a document entitled the 
 Report of the Working Party on Charters and Profiles 
. Arising out of that report institutional charters were expected to outline and describe institutions’ approaches to fulfilling Treaty of Waitangi obligations towards Maori by identifying how they would give effect to relationships with Maori. That directive was reiterated in the Tertiary Education Commission’s document  
Charter Guidelines 
. With regard to profiles the situation was similar. The 
 Report of the Working Party on Charters and Profiles 
 stated that one of two fundamental expectations of profiles was that they would identify how an organisation planned to work with Maori. That report was significant in that it underscored the need for a Treaty-based relationship between tertiary education providers and Maori and in relation to the issue at hand it highlighted the need for the institutions to develop their charter profile system in consultation with Maori. 
But with this bill before us the requirement to consult Maori and the acknowledgment of consultation as central to the Treaty relationship has for some reason been written out. So what has happened since that report was released in 2001? Just to take us back a little I say Maori scholarships and references to the Treaty in policy documents have been scrapped in the face of accusations of race-based privilege made by the previous leader of the National Party Don Brash— 
Hon Darren Hughes 
: That’s right. 
TE URUROA FLAVELL 
: —the Foreshore and Seabed Act which denies Maori both land rights and legal rights has been passed—that is right—Treaty settlement legislation has continued to be passed amidst criticism of poor process including inadequate consultation; the Treaty of Waitangi Act 1975 has been amended by specifying a closing date for submitting historical claims to the Waitangi Tribunal without prior discussion with or agreement from hapu and iwi Maori; a member’s bill to delete the principles of the Treaty of Waitangi from all legislation has been supported to go to a select committee; the Treaty of Waitangi was removed from the school curriculum by deleting references to it in the Ministry of Education’s 2006 draft curriculum document; direct references to the Treaty of Waitangi and its principles have been deleted from the new health policy action plans and contracts; land subject to Treaty claims has continued to be put up for sale without any prior communication with claimant iwi; and the list could go on and on. 
But to come back full circle to the field of tertiary education we are now considering a bill that allows tertiary education providers to prepare a proposed plan in consultation with those who they consider ought to be consulted. The key words are “ought to be consulted”. We know from experience that unless a requirement to consult is spelt out in black and white it does not happen despite the planning and despite the good will. We also know from experience that those who do consult who take the time to build the relationships from which robust consultation and productive decisions can emerge come to value it a great deal. And that is not to mention the economic benefits that often follow as a result of consultation. 
The Maori Party’s amendment to clause 10 of the bill is to rectify that omission by adding subsection 10(3)(e)(iii) to new section 159ABA which would require tertiary organisations to consult with Maori—with hapu iwi and Maori staff and students—in preparing their proposed plans. It is important that the gains developed out of the tertiary reform process of the late 1990s and early 2000s are not cast aside. 
In yesterday’s speech at the second reading of this bill I talked of the Treaty being about relationships: a commitment to a constructive and mutually reached respectful relationship by both Maori and the Crown. I reiterate also from yesterday’s speech that the lack of commitment this bill makes to the Treaty by failing to match up the ministerial requirements to set a long-term strategic direction for Maori development aspirations to a Treaty-based context makes the Treaty meaningless invisible and invalid. 
Although the issue of consultation with Maori has been the focus of the recent period of tertiary education reform one issue that was not resolved was that the same care for the Treaty in terms of constructive mutually respectful relationships be asked of the Tertiary Education Commission in the performance of its functions as is asked of institutional councils in the performance of theirs. The idea shared in the select committee by Te Tauihu o Nga Wananga which is basically the collective of the three whare wananga is that for a Treaty relationship to be meaningful it needs to exist at all levels of the tertiary education system whether at Government level or at the level of the tertiary institutions. 
The amendments to the Education Act 1989 that established the Tertiary Education Commission failed to include an acknowledgment of the Treaty and its principles and that was despite the presence of a tailor-made section for doing so—namely section 159G “Principles guiding how Commission operates”. The amendment that we are talking about today from the Maori Party to add a new clause 11A to the bill proposes that the statutory requirement of tertiary institutional councils to acknowledge the principles of the Treaty of Waitangi in their governance role be reciprocated and reflected also by the Tertiary Education Commission in its planning and monitoring role on behalf of the Government. That would mean that the Tertiary Education Commission would have a statutory requirement to make good on the Treaty and get past the frustrating ad hoc and absent processes that have been reported to us over the last couple of years. 
In closing I say the purpose of the amendments is to make the Treaty meaningful real and visible. We hope that members of the Committee will be able to give serious consideration to our proposed amendments and will vote accordingly. Kia ora tatou. 
LESLEY SOPER (Labour) 
: 
 I move  
That the question be now put 
. 
The CHAIRPERSON (Hon Clem Simich) 
: We have had 13 speakers including three doubles. But you have nine amendments and you opened the debate so I think you should close it Dr Paul Hutchison. 
Dr PAUL HUTCHISON (National—Port Waikato) 
: 
 Thank you very much Mr Chair for your generosity in allowing me to speak again on the Education (Tertiary Reforms) Amendment Bill. I must say that I was appalled that Labour right from the beginning of Part 1 has tried to close the debate—firstly Moana Mackey then Jill Pettis then Sue Moroney and then Maryan Street more or less in that order—and that is of huge concern. 
Sue Moroney 
: I raise a point of order Mr Chairperson. The member said that I tried to move a closure motion and I have not done that. It is wrong. The information is false. 
The CHAIRPERSON (Hon Clem Simich) 
: That is not a point of order although it did relate to a procedural matter. 
Dr PAUL HUTCHISON 
: Thank you Mr Chair. 
I would like to concentrate on this area of commercial sensitivity which has been of great concern to the universities and to the polytechs because in this last 15 years there has been a different era in terms of most of our academic institutions developing commercial arms. Prior to that what they tended to do was altruistic selfless and for the good of mankind. But what has happened over these last 15 years—I think starting with UniServices in Auckland University in about 1992—is that those institutions have all formed commercial arms. This may or may not be a good thing but it is certainly the reality of today’s world and it is very important for New Zealand that we make sure that the commercialisation of research is enabled to the greatest extent possible. 
The universities have said that being required in the summary plans to insert commercial information may ruin some of the deals that they could be planning. That is of great concern when members think for instance of the Pfizer deal with Auckland University. That was cancelled for other reasons but it was a $65 million agreement with the university and it was profoundly unfortunate that the company decided to withdraw the funding. 
In Supplementary Order Paper 161 I have tried just to diminish or protect to a small extent the amount of information that an organisation is required to put in its summary plan. It states: “an organisation is not required to include details in any plan summary of information that is confidential or commercially sensitive or that may otherwise be withheld from disclosure under the Official Information Act” etc. I think that brings us just another edge closer to giving institutions a degree of comfort and that is the reason why I have inserted it. I believe it was constructive and I think it is realistic. 
It is correct that at the end of the day one does have an Official Information Act process. However as we all know when an institution has something that is very sensitive it is very easy to have that document leaked in this day and age of emails—and we know it around Parliament around New Zealand and around the world. So I think every possible mechanism that we can bring in to ensure that commercial sensitivity is protected within the bounds of reason is appropriate. 
Clearly organisations like Business New Zealand have said in their submissions “that the bill should reflect the principle that information regarding the use of public funds must be as freely available as possible”—I totally agree with that—“apart from the fact that exceptions to this principle should be made only when there are compelling reasons; for example national security privacy—natural persons—or commercial sensitivities.” As we know New Zealand universities are very cash-strapped; there is a cap put on their funding 
Hon Steve Maharey 
: Promise more money. 
Dr PAUL HUTCHISON 
: Well I say to Mr Maharey that he may need it in a few months’ time down there at Massey. I think it is after some funding. But the very important thing is that this is potentially a crucial source of funds for universities. Hence we want to make every protection possible. Thank you for indulging me Mr Chairman. 
Hon MITA RIRINUI (Minister of State) 
: 
 I move  
That the question be now put 
. 
Motion agreed to. 
The question was put that the amendment set out on Supplementary Order Paper 161 in the name of Dr Paul Hutchison to section159AA in clause 6 to omit subsection (3)(a) and substitute new subsection (3)(a) be agreed to. 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 49 
New Zealand National 48; Independent: Copeland. 
Noes 70 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 2; Progressive 1; Independent: Field. 
Amendment not agreed to. 
The question was put that the amendment set out on Supplementary Order Paper 161 in the name of Dr Paul Hutchison to section 159AA in clause 6 to omit subsection (4) and substitute new subsection (4) be agreed to. 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 49 
New Zealand National 48; Independent: Copeland. 
Noes 70 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 2; Progressive 1; Independent: Field. 
Amendment not agreed to. 
The question was put that the amendment set out on Supplementary Order Paper 161 in the name of Dr Paul Hutchison to section 159AC in clause 8 to omit subsection (2)(a) and substitute new subsection (2)(a) be agreed to. 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 49 
New Zealand National 48; Independent: Copeland. 
Noes 70 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 2; Progressive 1; Independent: Field. 
Amendment not agreed to. 
The question was put that the amendment set out on Supplementary Order Paper 161 in the name of Dr Paul Hutchison to section 159AC in clause 8 to omit subsection (3) and substitute new subsection (3) be agreed to. 
A party vote was called for on the question  
That the amendment be agreed to 
Ayes 49 
New Zealand National 48; Independent: Copeland. 
Noes 70 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 2; Progressive 1; Independent: Field. 
Amendment not agreed to. 
The question was put that the following amendment in the name of Te Ururoa Flavell to clause 10 be agreed to: 
to add after section (3)(e)(ii) of section 159ABA: 
(iii)in consultation with local hapu and iwi Maori staff and students: 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 10 
Green Party 6; Maori Party 4. 
Noes 109 
New Zealand Labour 49; New Zealand National 48; New Zealand First 7; United Future 2; Progressive 1; Independents: Copeland Field. 
Amendment not agreed to. 
The question was put that the amendment set out on Supplementary Order Paper 161 in the name of Dr Paul Hutchison to clause 11 be agreed to. 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 49 
New Zealand National 48; Independent: Copeland. 
Noes 70 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 2; Progressive 1; Independent: Field. 
Amendment not agreed to. 
The question was put that the following amendment in the name of Te Ururoa Flavell be agreed to: 
to insert the following new clause: 
11ANew subsection added to section 159G 
Section 159G is amended by adding the following paragraph: “(d) acknowledge the principles of the Treaty of Waitangi.” 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 10 
Green Party 6; Maori Party 4. 
Noes 109 
New Zealand Labour 49; New Zealand National 48; New Zealand First 7; United Future 2; Progressive 1; Independents: Copeland Field. 
Amendment not agreed to. 
The question was put that the amendment set out on Supplementary Order Paper 161 in the name of Dr Paul Hutchison to section 159V in clause 17 be agreed to. 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 49 
New Zealand National 48; Independent: Copeland. 
Noes 70 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 2; Progressive 1; Independent: Field. 
Amendment not agreed to. 
The question was put that the amendment set out on Supplementary Order Paper 161 in the name of Dr Paul Hutchison to section 159YA in clause 17 be agreed to. 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 49 
New Zealand National 48; Independent: Copeland. 
Noes 70 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 2; Progressive 1; Independent: Field. 
Amendment not agreed to. 
The question was put that the amendment set out on Supplementary Order Paper 161 in the name of Dr Paul Hutchison to section 159YC in clause 17 be agreed to. 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 49 
New Zealand National 48; Independent: Copeland. 
Noes 70 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 2; Progressive 1; Independent: Field. 
Amendment not agreed to. 
The question was put that the amendment set out on Supplementary Order Paper 161 in the name of Dr Paul Hutchison to section 159YO in clause 17 be agreed to. 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 49 
New Zealand National 48; Independent: Copeland. 
Noes 70 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 2; Progressive 1; Independent: Field. 
Amendment not agreed to. 
A party vote was called for on the question  
That Part 1 be agreed to. 
Ayes 70 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 2; Progressive 1; Independent: Field. 
Noes 49 
New Zealand National 48; Independent: Copeland. 
Part 1 agreed to. 
Part 2 Related amendments to other enactments 
Dr PAUL HUTCHISON (National—Port Waikato) 
: 
 Part 2 deals with related amendments to other enactments of the very important Education (Tertiary Reforms) Amendment Bill. When speaking on Part 1 I stated its importance. Part 2 is equally very important as is the whole bill because it is so pivotal to New Zealand’s future economic growth and productivity—the productivity that has been so sadly lacking under the Labour Government over the last 7 years. 
It is good to see the Hon Steve Maharey here in the Chamber this afternoon because in many respects this bill has been brought about by the failure of the continuous reform that has gone on over the last 7 years. In fact the OECD in its report this year said that on average reforms have occurred in tertiary education in New Zealand every 2 years. It has been calculated that just the bureaucratic costs of the reforms has been in the order of $419 million— 
Colin King 
: How much? 
Dr PAUL HUTCHISON 
: From the budgetary estimates it is $419 million. And here we are again with more reforms. Mr Maharey is off to Massey and he has left Dr Cullen and now the Hon Peter Hodgson to take over. But in the meantime that $419 million has gone to waste when it should have gone into education. 
It is quite interesting that clause 44(1) repeals the definition of profiles. After all profiles and charters were brought in by the Hon Steve Maharey during those turbulent years that resulted in soft courses and a huge extra wastage of money—over and above the bureaucratic wastage—which has amounted to about a billion dollars over the last 7 years. But it is interesting to recall just what the Hon Steve Maharey said about the reforms back in 2002. He said that “These reforms represent the culmination of the government’s promise to overhaul our tertiary education and training systems.” 
So there we were back in 2002 when those reforms were the “culmination of the government’s promise”. But here we are again: one more reform; another reform—what has happened to them? What did he say in 2003? He said: “The TEC will bring clear strategic direction to the system as a whole.” But we all know that the whole system has been mired down in a fog worse than those at Wellington Airport. 
Extraordinarily in 2005 the vice-chancellor of Victoria University wrote to Minister Maharey to proclaim that “The system is haemorrhaging dollars right before your very eyes.” That is how bad the legacy has been and that is why Dr Cullen was called in to bring in the latest reforms which we have here in Part 2. 
As I said the charters and profiles have been taken away. They were instituted by the grand architect over there Steve Maharey but have been dispensed with by the new investment plan the grand new investment plan that is supposed to be introduced every 3 years. But in actual fact if we look at the wording of this bill more closely we see that it looks as if the Tertiary Education Commission has the Draconian power not only to insist on a 3-year investment plan but to require institutions to have a short-term plan a medium-term plan and a long-term plan. 
But I will stick strictly to Part 2 of the bill because it deals with industry training organisations. There were some good submissions particularly from Competenz which submitted that the bill legitimises existing implementation tools. However it said that the Tertiary Education Commission’s decisions were negating the intent of those tools. 
Competenz contended that the tertiary education strategy and the investment guidance required industry training organisations to develop more qualifications at levels 5 to 7 of the national qualifications framework to ensure that training took place. However the Tertiary Education Commission’s cap on industry training organisation funding at levels 5 and above constrained its ability to meet this requirement. 
Those are the sorts of topsy-turvy things that the Government has done. On the one hand it has said that it wants organisations to offer higher-level training but on the other hand it is bringing in these caps which will make it more difficult. 
Just to conclude it is important to say that this bill was supposed to be about quality value for money and relevance. Yet we have a situation with Modern Apprenticeships. I am sure my colleague Colin King who is an expert on them will expand a little further on this aspect. Modern Apprenticeships were supposed to be the great new thing of the Labour Government but we know now that the scheme’s completion rate is abysmally low. The Labour Government has lauded the scheme as being the grand new thing yet we know that back in 1992 the industry training organisations had to come in. The old apprenticeships system was a shambles. We needed to modernise training within industry and that was done very well by the National Government of the time. 
Over the last 7 to 8 years the Labour Government has poured millions of dollars into its so-called flagship Modern Apprenticeships scheme only to find that an abysmally low number of apprentices have actually completed the courses. 
KATHERINE RICH (National) 
: 
 As I rise to speak to Part 2 I would like to say that it is good to have a Minister in the chair Maryan Street who at least listens to the debate and responds to some of the concerns we raise unlike other Ministers who sit and do crosswords. 
I would like to start by commenting that here we are as late in the piece as this after nearly 8 years of a Labour Government still looking at tertiary sector reform. Every 2 years as my colleague said we are right back here looking at tertiary reform. I think out there in tertiary land a number of people are suffering from reform fatigue. They have seen it all before. A lot of tertiary providers bought into the production of their charters and their profiles. They spent a huge amount of money genuinely going through the processes only to be told that everything was going to change and we were to move to a 3-year plan. I would like to hear what Steve Maharey has to say on this. I would like him to take a call actually to tell us whether he will change his tune on tertiary reform because when he takes on his new role he will find he will be asked to plan plan and plan again. 
I draw members’ attention to some of the comments made by representatives of the Vice-Chancellors Committee which gave a very powerful submission—and I know that Minister Maharey will enjoy taking part in Vice-Chancellors Committee meetings. The vice-chancellors had some very serious things to say about the bill. They said there would be an unwarranted loss of academic freedom and autonomy. They said the bill was going to be uniformly directive and controlling and they talked about it providing the Minister with greater powers than ever before. They said they were concerned that the bill would open universities to direct ministerial intervention and they made the point that none of the world’s leading universities were subject to the degree of control proposed in this bill. So I am sure that when Steve Maharey gets out there into tertiary land he perhaps will change his tune on a lot of these things as he finds it increasingly difficult to run a university under this bill. 
This bill proposes less bureaucracy and more focus on quality and value. That is what the rhetoric says but what we have in here is something quite different. The Minister said that things will no longer be demand-led. I do not think we can ever turn our back on demand because a lot of the services provided in our tertiary sector are in increasing demand. In the early childhood education area there is a shortage of trained teachers and of course there is an increasing demand on some of the services to provide education for people who want to learn and to get them out into the market place. 
Through this bill the Tertiary Education Commission is proposing that it puts a cap on the number of seats for prospective students at a time when there is an increasing demand for those services. So there must be some flexibility there because the country does need people with the sorts of skills provided by those services and we need to ensure that we can support and train as many as we wish. On the other hand in some areas there are not as many positions available for people to go into afterwards. 
In respect of Part 2 I refer now to industry training organisations. We have heard a lot of discussion about the Modern Apprenticeships system and the Government has patted itself on its back endlessly about the number of Modern Apprentices that have been created. [ 
Interruption 
] I tell Lesley Soper that her Government does not know how many apprentices are completing their apprenticeships. It is all very well to have thousands and thousands of apprentices but we would quite like them to finish their apprenticeships and go out into the workforce. I know that when I have asked the Minister for completion rates—as have my learned colleagues—we have been told time and time again that he does not have a clue and that the Government does not have a clue how many of these young men and women are actually finishing— 
Lesley Soper 
: Go and tell all those business people about what wonderful things you did for the apprenticeship system and see what they have to say about it. 
KATHERINE RICH 
: Deluded! I rest my case. That member obviously does not understand this bill. She was a useless member for the New Zealand Educational Institute in Invercargill and I think she proves the point by some of her inane utterances here in the House. 
COLIN KING (National—Kaikoura) 
: 
 It is interesting to compare Part 2 of this Education (Tertiary Reforms) Amendment Bill in respect of industry training organisations with related amendments to other enactments. It is just a little bit of material compared with what is in Part 1 and it sort of indicates where the problems are in the tertiary education system. 
When I stop to think about industry training organisations and the Industry Training Act I would say there are about 40 such organisations. It was a marvellous concept that went forward with cross-party support and it was seen to be a solution at that time—before 1992—to an apprenticeship model that was not quite meeting needs. It worked itself through very very effectively and by 1999 some 50000 people were employed in training under the industry training organisations’ standard training measure model. They effectively covered a full range of industries. 
So when we look at Part 2 we see the changes around plans and proposed plans are transferred into the Industry Training Act. On that basis it is significant to appreciate that a proposed plan is what it says—it is a proposed plan; it is not an approved plan. Basically it is a plan put forward with consultation and discussion to be approved by the Tertiary Education Commission. Once it has been approved it becomes the plan. However it is worth noting today that a complex situation has been created around tertiary education whereby some 15 percent of people go to university and some 85 percent of kids leaving school go into trades-related or industry training provider types of training and employment. Therein lies some of the concern in relation to this entire bill but which is particularly highlighted because of the Industry Training Act 1992. 
Very little has been said about the New Zealand Qualifications Authority but it is a fascinating beast in itself because it is meant to ensure the quality of training of the qualifications of the moderation and of the approval of new qualifications. The industry training organisations manage industry training. They manage the qualifications which are put on to the New Zealand Qualifications Authority framework and those providers that are contracted by the industry training organisations deliver to those qualifications. 
However the Plumbing Gasfitting and Drainlaying Industry Training Organisation which has been trying to align its qualifications with the exams and registration that come from the Plumbers Gasfitters and Drainlayers Board has taken virtually 2 years to get that approval through. I recognise—as highlighted by Hazel Armstrong—that some personality problems were involved but in putting questions to the Minister for Tertiary Education the feedback we were getting was that things were pretty well in line. On that basis it is hugely concerning for the many people involved in industry training that it is taking as long as this. It is not good enough. When reference is made to a plan and people are interfacing with the Tertiary Education Commission the fatigue and demoralisation caused because of the time it is taking is concerning. Quite often the comment that comes back to us is “We’re being thorough.” Unfortunately we are hearing from the industry training organisations that every time they make contact with the New Zealand Qualifications Authority they are making contact with a different person. There seriously needs to be a way of managing institutional knowledge so that things are moved forward quickly. 
When we look at the plan in Part 2 it is worth noting that the industry training organisations have been capped for many years at a total of $174 million. In the last Budget they were given $14 million to take on a leadership role. On that basis it is interesting to see that the private training establishments and the industry training organisations were capped. In fact the majority of the industry training side of things has been capped which leaves us with an interesting challenge in the middle. 
I want to talk for a few minutes on the issues that this bill does not address but which are referred to in Part 2 “Related amendments to other enactments. Amendments to Industry Training Act 1992”. It is the overlapping provision and it is something that no doubt an incoming National Government will have to get to grips with. 
There is a bad relationship between the industry training providers and the industry training organisations. It has been brought about by an overlapping of provision. What that means is that the industry has developed qualifications that are funded at a standard training measure rate of $3200 per year per 120 credits. However the polytechnics are funded at a rate of up to and above $8700 per standard training measure. So this is an area that a National Government will have to sort out because it is untenable. 
Sue Moroney 
: Oh like you did last time! 
COLIN KING 
: If I may seek the indulgence of the Chair I would like to talk for a few moments about the Modern Apprenticeships scheme because for the benefit of the new junior whip it too has now been embroiled in this. The Minister Pete Hodgson said the other day that there are now 13000-odd Modern Apprentices and that barely 4000 of them have completed their apprenticeship. An example of the butchered nature of what would otherwise have been a very good policy is the case of Masterlink which is a Modern Apprentice coordinator receiving $165000 and having only one completion. That is only half of the equation because if we put in the standard training measure funding which is probably another $50000 there is in excess of $200000. I want the junior Government whip to remember that. There has been a good policy. This member was a Modern Apprenticeship coordinator and the first time I met the Minister Steve Maharey was when I shook his hand when Labour introduced the policy. Unfortunately it has been totally butchered. 
Sue Moroney 
: Labour introduced the policy! 
Lesley Soper 
: There we are. 
COLIN KING 
: If the two members who are interjecting would just listen they will learn. Last year in Auckland under the building and construction industry training only 9 percent of building apprentices completed their apprenticeships. The Manukau Institute of Technology’s managed apprenticeships—we now have managed apprenticeships being run by the industry training providers—had 90 percent of completions. So now we have a real issue. The Modern Apprenticeships scheme which was the Labour Party flagship has an abysmal completion rate and on the other side there are high levels of completion on the managed apprenticeship programme which is actually an overlapping provision that the Government—or National when it becomes the Government—is going to have to sort out. We have a massive problem there and it has all been due to the problems associated with a 7-year butchering of the tertiary education sector. 
ALLAN PEACHEY (National—Tamaki) 
: 
 I appreciate the opportunity to rise and speak to Part 2 of the Education (Tertiary Reforms) Amendment Bill. It does give me an opportunity to correct an omission when I spoke on Part 1. I acknowledged the role of the officials and the fine outstanding work of Dr Hutchison which I want to repeat and of the National members on the Education and Science Committee. I really should have paid tribute to the Hon Brian Donnelly who led the committee through very difficult and complex stuff without a yawn without missing a point and with a very very good grasp of detail. Although I disagreed with some of the things that Mr Donnelly said when he spoke in the House earlier this afternoon I certainly do respect his grasp of the detail. There is no doubt about it when Mr Donnelly abandons the sinking ship to go to the Cook Islands the select committee will very very much miss his chairmanship. 
Colin King 
: A very good man. 
ALLAN PEACHEY 
: As Mr King says the committee will be losing a very very good man. In speaking to Part 2 perhaps I could reflect for a minute on one of the things that so many of us are noticing in this Chamber now—Mr Donnelly’s defence of the Government was far more rigorous than the Government has been able to put up for itself. It was interesting to listen to the comments of the Minister in the chair Maryan Street when she spoke; and I just take the opportunity to congratulate her on her promotion and to wish her well. 
When we think about Part 2 the words that kept coming out were “plans plans plans”. Goodness gracious me it took me way back to fifth-form history and the lessons one learnt about the failures of the 5-year-plans of the Communist systems of Europe. I hope we are not falling into that sort of trap—the view that somehow one can plan plan plan and somehow things will get better. Then that marvellous word “commissariat” came out. It is not a word that I have heard for many years but it was dropped into the conversation so readily and so easily and with so little thought that it really does give those of us on this side of the Chamber a little bit of cause to wonder just what the underlying driving ideology is that has come from the other side. 
I also want to take a minute to acknowledge the previous Minister of Tertiary Education and to congratulate him upon his appointment to the vice-chancellorship of Massey University. I think I am right in saying that he will not be the only former member of this House to hold that position. It is going to be really interesting to talk to Mr Maharey in a couple of years’ time and see the extent to which his perspectives have changed and see the extent to which he will be pulling his hair out trying to run a university under the plans and other constraints that are being imposed by his very colleagues. 
One would have to reflect a little bit on the irony of the situation. We are debating Part 2 because Mr Maharey when he was Minister for Tertiary Education made a bit of a botch of things. They put Dr Cullen in to sort of tidy it up and now they have landed it on poor Pete Hodgson. In 12 months’ time the original cause of the trouble will be trying to run a university under this constraint. 
When I reflect on the provisions of clause 2 I must say is not the House fortunate to have a man with the understanding of the industry training sector that my colleague Mr King has? Did he not speak well in drawing the Committee’s attention to the issues being faced? Would it not have been good if the Labour members on the committee and those in the Chamber had actually instead of being in such a rush to get these controls and these plans and goodness knows what into place taken a little time to listen to what Mr King has been saying and to reflect on what sound observations and advice he has on this subject? 
LESLEY SOPER (Labour) 
: 
 I move  
That the question be now put 
. 
ALLAN PEACHEY (National—Tamaki) 
: 
 I appreciate the call in enabling this debate to carry on because these matters are important to the future of New Zealand. One should reflect on why the Government keeps trying to shut down the debate. 
I want to finish my contribution because I have a very very important point to make. We have to see Part 2 in the context of the future that may lie out there for the New Zealand economy. One has to wonder why a Government—at a time when everybody is talking about the abilities knowledge skills and attributes that graduates will need in the future to be successful in a modern market-based knowledge-driven economy—wants to plan to restrict the universities in particular from the ability to produce that sort of graduate. 
When we look at the provisions in Part 2 and consider them together with Part 1 and the rest of the bill we have to ask ourselves how the tertiary education sector which this bill seeks to shape control design and plan—that word again—will contribute to producing both the quality and attitude of graduates that this country will need whether they be from universities polytechs or trade training organisations. 
I have heard Labour members defend Part 2 and talk about rationalising resources getting the best result out of them and all the rest of it. That is a smokescreen for the real purpose of this bill. Much of the purpose of this bill is what lies behind so much Government legislation that is brought to the House. This bill is not about the best outcome for New Zealanders or about strengthening the tertiary sector; it is all about Government control. For that reason alone it is vital that the Committee votes the bill down. 
A party vote was called for on the question  
That Part 2 be agreed to. 
Ayes 68 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; Progressive 1; Independent: Field. 
Noes 49 
New Zealand National 48; Independent: Copeland. 
Part 2 agreed to. 
Clauses 1 to 3 
The CHAIRPERSON (Hon Clem Simich) 
: There will be three votes and one debate. 
Dr PAUL HUTCHISON (National—Port Waikato) 
: 
 Thank you Mr Chairperson for the opportunity to speak on the very important title and purpose clauses. As National has said many times this bill was supposed to be about reforming the tertiary education system in New Zealand. It was supposed to be about introducing quality relevance and value for money. But the very opposite is happening as we see the burgeoning bureaucracy and complexity that have thrived before our eyes through the evolution of this bill. 
I think the title should be something like “The Labour Government (Let’s Reform the Tertiary System Again) Bill” because the last reforms were so bad. We have been through the evolution of that. We know that 2-yearly over the last 7 years there has been a reform in the system whereby a billion dollars which should have gone into tertiary education was misspent and wasted. Perhaps the title should be “The Labour Government (Let’s Add More Bureaucracy to the Tertiary System) Bill” because the Government likes complexity. 
But the really important and poignant title would be “The Labour Government (Let’s Trample Over Academic Freedom and Autonomy) Bill”. It was indeed poignant earlier when we heard Maryan Street say the word “commissariat”. It just slipped off her tongue. That reminds us of the central control that is taking place in institutions right around New Zealand. As just one example I note that the Southern Institute of Technology has had 2500 equivalent full-time students ripped from it because it was performing so well. This is not quality and value for money; this is punishing quality and instead controlling it—just like a commissariat does. 
It is important to go back to the Education Act 1989. Part 14 of that Act talks about the establishment and disestablishment of tertiary education. Section 160 “Object” states: “The object of the provisions of this Act relating to institutions is to give them as much independence and freedom to make academic operational and management decisions as is consistent with the nature of the services they provide the efficient use of national resources the national interest and the demands of accountability.” So it was quite extraordinary when the Vice-Chancellors Committee came to the table at the Education and Science Committee and told the committee that this was one of the most damaging situations they have ever seen. They said: “It should be noted that none of the world’s leading universities are subject to the degree of control proposed in this Bill” and that “in no other western democracy has a state sought this degree of control over a university’s teaching and research or claimed either ownership of or an ownership interest in universities.” They also said: “Nowhere else in the world is bureaucratic control of universities seen as the route to educational excellence.” 
That has to be a damning indictment on this Labour Government. But the victory is that the select committee process did indeed see the Labour Government—in fact Dr Cullen—dragged screaming and agreeing to a qualification being put into the purpose clause to say that academic freedom and autonomy would be retained. Thank goodness for the select committee process and thank goodness for the National Party! 
As I said before this was a demonstration of just how arrogant and tired this Labour Government has become over the last 9 years and how lacking of insight it has become. It is quite ironic that in the context of the Electoral Finance Amendment Bill the Government is squashing democracy and at the same time through the Education (Tertiary Reforms) Amendment Bill it is trying to quash academic freedom. 
KATHERINE RICH (National) 
: 
 I think a better name for the Education (Tertiary Reforms) Amendment Bill would be the “Education (Tertiary Reforms) Here We Go Again Amendment Bill” because frankly this Government continues to reform and reform but does not get anywhere. A lot of tertiary providers are suffering from reform fatigue because here we are again talking about stuff that Labour has been talking about for the last 8 years but getting nowhere. After the expenditure of $419 million here we are again. Talk about value for money! And that is one of the objectives of the bill. 
My question to the Minister of Education would be how it is value for money that here we are debating this bill 8 years after Labour started talking about reforming the tertiary sector and having spent that amount. That money did not go on students; it basically went on the production of a whole set of glossy documents and “thinkpieces” culminating in this bill here today. 
This bill is supposed to increase transparency. It is supposed to ensure that there is better spending in the tertiary sector. Well I have not seen any evidence that this bill will contribute to that. In effect it will contribute to a greater amount of bureaucracy that tertiary providers have to face and a greater number of plans strategic plans documents workshops hui and sitting around on yoga mats with crossed legs and talking about stakeholder engagement. That will make no difference to students. Ultimately I think tertiary reform has to make a difference to students. I would like to hear from the Minister why this bill will make a difference for students. 
Lesley Soper 
: How many tertiary students have you spoken to recently? 
KATHERINE RICH 
: There is Lesley Soper again the most useless member of the New Zealand Educational Institute. During the Invercargill reforms she said nothing and did nothing. The schools in Invercargill just about kicked her out of there. 
Lesley Soper 
: How many tertiary students have you spoken to recently? 
KATHERINE RICH 
: She is still going on. 
Hon Member 
: The Labour Party is trying to get rid of her. 
KATHERINE RICH 
: That is right. Labour people do not want her in Dunedin. They are bending over backwards to make sure they do not have her in Dunedin—that is for sure. 
I turn back to the bill. This bill was designed to move away from a “bums on seats” mentality in universities to one that was less demand-led. But this Government has put more bums on the seats of courses such as radio singalongs homeopathy for pets knitted jackets for small pets and pendulum swinging for beginners. The expenditure on those kinds of areas has increased over a period of time. 
Simon Power 
: The member can’t be serious. 
KATHERINE RICH 
: Well I might have made up the knitted jackets for small pets course. I will admit that but the others are true. 
This bill will not lead to a greater amount of relevance and transparency. 
Lesley Soper 
: What was the unemployment rate under National? What happened to the apprenticeship system under National? 
KATHERINE RICH 
: There is Lesley Soper again. Her dress sense is inspired by a Prince video. That is right; she could have had a part in the “Raspberry Beret” video. 
But I will go back to the bill. If this bill is so popular why did the Vice-Chancellors Committee come out and make such damning comments about it? Why did it say that the bill would bring in unprecedented control of the tertiary sector put academic freedom at risk and put more control in the hands of the Minister than we have seen? 
Lesley Soper 
: Read clause 3. 
KATHERINE RICH 
: She is still going. I think we on this side of the Committee have really hit a nerve with our debate. By sitting in that seat she obviously has aspirations to be the chief whip. But even Dunedin will not have her and Invercargill is not very keen either. 
I would like to pay tribute to the chairman of the Education and Science Committee Brian Donnelly because I think he did a good job in terms of trying to address some of the industry’s concerns. But a lot of people within the tertiary education sector are still deeply concerned about the impact on academic freedom and deeply concerned that this bill will bring in more red tape and bureaucracy—not less. The concentration on planning to the nth degree does not make a single bit of difference to students and ultimately that has to be the focus of all tertiary reform. The Minister may wish to move away from a demand-led approach but demand still plays a part. Certainly we have shortages in the area of the early childhood sector as I have outlined. I hope that the Tertiary Education Commission is able to deal with that as well. 
Lesley Soper 
: Don’t take any trouble to read it. 
KATHERINE RICH 
: She does not give up. 
Simon Power 
: Take a call! 
KATHERINE RICH 
: The member should take a call. She manages not to give any speeches in the Chamber. The only thing I have ever heard her say is “I move that the question be now put.” That is obviously the sign of a frustrated speaker. [ 
Interruption 
] And there is Sue Moroney the only person in the Committee who can knock the last two letters off her name and get “moron”. Thank you. 
Hon MARYAN STREET (Associate Minister for Tertiary Education) 
: 
 I am pleased that the National Party in Opposition has got to the end of a Thursday and clearly the National members’ levity has overcome them because they seem to be unable to comprehend the seriousness of the purpose of the legislation in front of us. It is absolutely critical that this country has a high-performing tertiary education sector and that is not only to do with the universities but to do with polytechnics and the industry training organisations that serve the training purposes for those people in trades and occupations that this country needs. This country needs well-equipped and competent people for those occupations. 
This Education (Tertiary Reforms) Amendment Bill implements the Government’s reforms of the system and contrary to the lunatic assertions that we have heard in some of the speeches just given by members of the Opposition the reforms of the tertiary education sector have been long in coming. These reforms are being set in place because they are sensible and they give the tertiary education organisations some security and forward planning capability and because the kinds of synergies that exist between the plans outlined in this bill and the requirements of students which are at the heart of this bill are aligned. The fact that there is a 3-year plan should not come as any surprise to members opposite—although clearly it does—because most of our tertiary qualifications take 3 years to complete. I have had the privilege of being a member of staff in an academic capacity for 9 years at Auckland University and I know how long it takes to prepare degree courses diploma courses and postgraduate courses and I know the kinds of things that are involved in developing contemporary qualifications that young people require these days in order for this society and for our country to be able to meet contemporary and future challenges. That is what this bill is about and no amount of levity or inanity from the Opposition can detract from the serious purpose of this bill. 
This is a good bill. It prepares our tertiary education sector to engage with the community and to assess the needs of its community on a regular and planned basis. It allows our tertiary education sector to be responsive to need but it also gives the sector security of funding on an ongoing 3-year basis. That is the kind of mechanism that this bill delivers. It is a technical bill in that sense but let us not for a moment lose sight of its overriding purpose. Its purpose is serious. The mechanism needed to deliver quality planned tertiary education and therefore to contribute to the skills and the economic transformation of this country is the underpinning of this technical bill. The sooner the members opposite take it seriously the better. 
Progress to be reported presently. 
House resumed. 
The Chairperson reported the Appropriation (Continuation of Interim Meaning of Funding for Parliamentary Purposes) Bill with amendment progress on the Education (Tertiary Reforms) Amendment Bill and no progress on the Building Amendment Bill. 
Report adopted. 
The House adjourned at 5.56 p.m.