Volume 633 Week 23 - Wednesday 23 August 2006 
Volume 633 Week 23 - Wednesday 23 August 2006 
[Volume:633;Page:4763] 
Wednesday 23 August 2006 
Madam Speaker 
 took the Chair at 2.15 p.m. 
Prayers 
. 
Visitors 
Germany—Committee for Labour and Social Services Bundestag 
Madam SPEAKER 
: I have much pleasure in informing the House that members of the Committee for Labour and Social Services from the Bundestag Federal Republic of Germany led by Dr Ralf Brauksiepe are present in the gallery. I am sure that members would wish that the delegation be welcomed. 
Speaker’s Rulings 
Questions for Oral Answer—Questions to Members 
Madam SPEAKER 
: On 3 August I promised to reflect on issues that arose during questions to non-Ministers. The first related to whether a deputy chairperson may answer a question to a chairperson of a select committee in the latter’s absence. In the case of questions to Ministers any other Minister or a Parliamentary Under-Secretary may answer a question on behalf of a Minister who is absent—Standing Order 376(2). There is no right to answer a question to any other member who is absent. Thus in principle a deputy chairperson cannot reply on behalf of an absent chairperson. However this is qualified by Standing Order 203(1) which provides as a general rule that if the chairperson is absent during a “meeting” or is absent from New Zealand or if there is a vacancy in the office of chairperson then the deputy chairperson “performs the duties and exercises the authority of the chairperson”. In those circumstances—and only in those circumstances—the deputy chairperson effectively is the chairperson who can answer questions. 
Mr Finlayson argued that the word “meeting” in Standing Order 203 includes a meeting of the House. He referred to a reference to a meeting in Standing Order 12 to support this. I cannot accept this argument. The meeting referred to in Standing Order 12 is a meeting of a new Parliament not of the House. Meetings of the House are correctly referred to as “sittings”—members can see the heading to chapter 2 and numerous other references in the Standing Orders. In Standing Order 203 “meeting” refers to a meeting of a select committee. If a chairperson is absent from a meeting of the committee the deputy chairperson acts as chairperson at that meeting of the committee. But that does not mean that the deputy chairperson can assume the chairperson’s functions in this Chamber. 
The question to the chairperson of the Justice and Electoral Committee was therefore properly postponed when she was absent from the House and attending a meeting of the committee. 
The second issue that I want to comment on is the breadth of questions that can be put to members under this procedure. Questions to Ministers are dealt with under Standing Order 369. A very wide latitude is permitted for members to lodge questions to Ministers on any “public affairs with which the Minister is officially connected”. Questions to other members are put under Standing Order 370. By contrast their ambit is defined much more narrowly. They can relate only to any bill motion or public matter “connected with the business of the House” of which the member has charge. Most—though not all—questions to other members are questions to select committee chairpersons and page 142 of  
Speakers’ Rulings 
 describes the limited scope for such questions. The same narrow scope applies to other types of questions such as questions to members in charge of a bill. Questions to Ministers are much wider than are questions to other members. 
Finally in the exercise of their discretion to permit supplementary questions under Standing Order 378 Speakers do not normally allow more than one or at most two supplementary questions to each question to another member. This again contrasts with the practice on questions to Ministers when a much more extensive exchange is permitted. 
Questions to Ministers 
Speech from the Throne—Political Integrity of Parliament and Electoral Process 
1. Dr DON BRASH (Leader of the Opposition) 
 to the  
Prime Minister 
: Does she stand by the statement in the Speech from the Throne in 1999 that her Government would “restore public confidence in the political integrity of Parliament and the electoral process”? 
Rt Hon HELEN CLARK (Prime Minister) 
: 
 Yes by keeping our promises as we have—unlike National in the 1990s. 
Dr Don Brash 
: Can she explain to the House how she expects the public to have confidence in the integrity of Parliament and the electoral process when her Government has conveniently ignored and dismissed the rulings of the Auditor-General the Solicitor-General the Chief Electoral Officer and the Electoral Commission by unlawfully spending taxpayers’ money and knowingly breaching the election campaign spending cap in the Electoral Act? 
Rt Hon HELEN CLARK 
: The assertions in that question cannot be accepted. Of course unlike the National Party the Labour Party did not accept money from exclusive religious cults which enabled National to free up its own parliamentary spending. 
Dr Don Brash 
: Is it the case that the Auditor-General wrote to her on 28 April last year seeking a meeting to discuss his concerns about processes for the expenditure of taxpayers’ money through the parliamentary leader’s budget and can she tell the House how it assisted public confidence in the integrity of Parliament and the electoral process when she refused to meet him? 
Rt Hon HELEN CLARK 
: I seem to recall questions from the member on precisely this point before. I was written to as leader of the parliamentary Labour Party and representatives of the party met the Auditor-General. 
Dr Don Brash 
: I raise a point of order Madam Speaker. The Prime Minister has not remotely attempted to respond to either of my last two supplementary questions. She made an irrelevant comment which was totally without foundation about the Exclusive Brethren. There is no foundation for it at all. Could you ask her please to address the two questions I have asked. 
Madam SPEAKER 
: The Prime Minister certainly addressed the questions. It may not have been to the satisfaction of the member. Also may I say it would be a little easier for the Speaker to hear the full answers if there were a little less barracking. 
Dr Don Brash 
: Is it the case that she declined the request from the Auditor-General to meet with her to discuss the use of public money on political advertising because she already had plans at that stage to use nearly half a million dollars of taxpayers’ funding for the Labour Party pledge card; and can she tell the House how those actions helped to encourage public confidence in Parliament and the political integrity of the electoral process? 
Rt Hon HELEN CLARK 
: I repeat that representatives of the parliamentary Labour Party met with the Auditor-General. Of course unlike the National Party we were not holding money back so that after the election we could put out ads like the one from Bob Clarkson which invites people to a public meeting around the theme “Good Jokers Unite!” at the RAZZA in Upper Hutt. If that is not an abuse I do not know what is. 
Rodney Hide 
: I raise a point of order Madam Speaker. 
Madam SPEAKER 
: Yes I think I am about to agree with your point of order. 
Rodney Hide 
: It sounded like such an exciting meeting that I just wanted to hear what it was about. 
Madam SPEAKER 
: Thank you. I agree with you. Would the Prime Minister please repeat her answer for the benefit of those who were unable to hear a word she said. 
Rt Hon HELEN CLARK 
: I repeat that representatives of the parliamentary party met with the Auditor-General as invited. I further note that unlike the National Party so loaded with cash from big corporates and the Exclusive Brethren the Labour Party did not receive money from them. The National Party held money back so it could use it for ridiculous branding advertising websites fake questionnaires and of course advertising this extraordinary meeting with Bob Clarkson—“Good Jokers Unite!”. 
Hon Brian Donnelly 
: I raise a point of order Madam Speaker. I believe that members in this House all have the right to hear the responses that are made to questions. We—myself and the colleague beside me from United Future—are sitting fairly close to the Prime Minister. We were unable to hear the answer to that question and we would like to have the answer repeated. 
Madam SPEAKER 
: Perhaps the Prime Minister would like to summarise her answer. 
Bob Clarkson 
: Madam Chair I would like to hear— 
Madam SPEAKER 
: I am sorry. It is “Madam Speaker”. 
Bob Clarkson 
: I am sorry Madam Speaker. It is a small point. 
Madam SPEAKER 
: Would the member please be seated. We are trying to be consistent with the Standing Orders so would the member please just make his point of order without any other comment. 
Bob Clarkson 
: If I am getting accusations chucked at me I would like to hear them. I am not hearing them. I am getting a bit pissed off. 
Madam SPEAKER 
: Maybe the member would like to have a word with some of his colleagues and then we would all have the benefit of hearing the answers. 
Rt Hon HELEN CLARK 
: You invited me to summarise my answer and for the benefit of Bob Clarkson can I summarise his advertisement with the parliamentary crest on it that calls on people “Good jokers unite”. I do not know whether women were invited. It states: “Enjoy an after work yarn with MP Bob ‘the Builder’ Clarkson”—all asked for at parliamentary expense. 
Dr Don Brash 
: Is the Prime Minister aware that members of her Government have used their majority on the Justice and Electoral Committee to block an invitation to the former Chief Electoral Officer Mr David Henry to appear and explain the steps he took to warn the Labour Party about the consequences of spending half a million dollars of taxpayers’ money on the Labour Party pledge card; can she explain how that will contribute to public confidence in Parliament and the integrity of the political process? 
Rt Hon HELEN CLARK 
: Clearly the National Party is still smarting about not having a majority in the select committee. I want to point out the Labour Party does not have a majority in the select committee either. 
Madam SPEAKER 
: Would the Prime Minister like to elaborate a little on her answer. 
Rt Hon HELEN CLARK 
: I am very happy to elaborate and point out that just as the National Party does not have a majority on that committee and is clearly very sore about that neither does the Labour Party. 
Stone Fruit—Exports 
2.  
RUSSELL FAIRBROTHER (Labour) 
 to the  
Minister of Agriculture 
: What progress is the Government making to improve access for New Zealand stone fruit to export markets? 
Hon JIM ANDERTON (Minister of Agriculture) 
: 
 Following the granting of access to export stone fruit from New Zealand to Western Australia last week there are currently no outstanding market access issues for stone fruit going from New Zealand to any export market. After a hard-fought battle for access—which seems to be the only kind with biosecurity issues—Biosecurity Australia released a policy memorandum last week that allows access for New Zealand apricots nectarines peaches and plums to the Western Australian market. The first exports are expected in December and will ultimately lead to exports worth around $14 million. I know that the National Party will be delighted in the success of biosecurity issues in this matter. 
Russell Fairbrother 
: What practical access to the Western Australian market will there be for New Zealand stone fruit growers? 
Hon JIM ANDERTON 
: New Zealand has been able to export cherries to Western Australia since 2003 but New Zealand apricots nectarines peaches and plums have been prohibited because of concerns about the risk posed by the oriental fruit moth. Initially these exports to Western Australia will for all practical purposes be limited to exports from the South Island as this area is free of the oriental fruit moth. Stone fruit from the North Island will still be given access but under different conditions and those will be negotiated over the longer term. Although that limitation is of course of concern apricots from the South Island make up 90 percent of New Zealand’s stone fruit exports. 
R Doug Woolerton 
: How many representations has the Minister made to Biosecurity Australia in regard to the continuing problem of access for New Zealand apples to the Australian market; and what outcomes were achieved as a result of those representations? 
Hon JIM ANDERTON 
: Impossible things we do daily; miracles take a bit longer! We are of course in close consultation with Biosecurity Australia. The industry and the Government have made submissions to its import risk-analysis process. We are expecting decisions before the end of this year and New Zealand of course has the issue of apples at the World Trade Organization Sanitary and Phytosanitary Committee and we will reserve our rights to take that further depending on the outcomes of the risk-analysis process going on at the present time. 
Labour Party Pledge Card— 
New Zealand Herald 
 Article 
3.  
JOHN KEY (National—Helensville) 
 to the  
Minister of Finance 
: Does he agree that he made an “apparent threat to pull a piece of tax legislation in retaliation for the  
Herald 
’s coverage of Labour’s pledge card rort” as reported by the media? 
Simon Power 
: I raise a point of order Madam Speaker. Halfway through my colleague’s question the Minister for State Owned Enterprises felt he could bellow across the Chamber. You have given several warnings on this matter over recent weeks; the Minister should be asked to leave the Chamber. 
Madam SPEAKER 
: No— 
Hon Trevor Mallard 
: A week or two ago when I was not here I was listening to the radio and listening closely enough to hear you give a ruling that made it clear that people could interject during questions. All I did was ask whether that question was drafted in Ireland. 
Madam SPEAKER 
: That was perfectly consistent with the ruling. Would John Key please continue. 
John Key 
: Does the Minister agree that at least two of the statements he made on the topic—namely that the  
New Zealand Herald  
would be wise— 
Hon Dr Michael Cullen 
: I raise a point of order Madam Speaker. The Opposition frequently complains that Ministers do not answer questions; I did not get the chance in that case. It is quite a brief answer but I would like to give it. 
Madam SPEAKER 
: My apologies. I am sorry Mr Key. Perhaps Dr Cullen would respond to your initial question and then you may ask your supplementary question. 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 No. [ 
Interruption 
] 
John Key 
: If you do not take the call it is not my problem. 
Madam SPEAKER 
: Would the House please settle so that we can hear the questions and the answers. 
John Key 
: Does the Minister agree that at least two of the statements he made on this topic—namely: “The Herald would be wise to consider the consistency of its position.” and that his message to it was just to think a bit carefully about the implications of what it is engaged in—were clearly intended to threaten the paper’s owners APN and that if the  
New Zealand Herald  
did not desist from both reporting and writing unfavourable editorial comments about the Government there would be implications? 
Hon Dr MICHAEL CULLEN 
: I cannot even find one of those quotes. In terms of the other one let me refer the member to the  
New Zealand Herald 
 editorial the previous day which stated that this “does not sound any different from that of taxpayers who have claimed deductions on the best available advice and it turns out on legal scrutiny that they have to pay the money back.” The  
New Zealand Herald 
 was in precisely that position and we were legislating to remove it. Despite all of its bluster it has failed to answer the question of what the moral difference is. 
Hon Peter Dunne 
: Will the Minister confirm that the legislation dealing with that matter is actually in the name of the Minister of Revenue and that he has made no approach to the Minister of Revenue about withdrawing or amending that particular provision? 
Hon Dr MICHAEL CULLEN 
: That is absolutely correct. Indeed if the member and the  
New Zealand Herald 
 had bothered to read the first press statement they would have seen that it said: “As a result the government has agreed to support legislation which effectively retrospectively validates that understanding and relieves the Herald’s owners of that bill.” All the Muldoonism and bluster came from the  
New Zealand Herald 
 not from me. 
John Key 
: If we are to believe the Minister that those comments were not of a threatening nature—that is could result in a changed attitude towards APN’s tax issue—then was the purpose of his comments actually to remind APN that it owed him and his Government a favour and it better not forget it? 
Hon Dr MICHAEL CULLEN 
: No not at all. It was to remind the  
New Zealand Herald 
 journalists that it is wise to be consistent. When one decides to climb on to a high moral horse it is a damn good idea to make sure the saddle is firmly tied on. 
John Key 
: Is it not a fact that the new modus operandi of this Government is that when it does not get its own way it just bullies? It does not matter whether the victim is a Television One journalist the APN owners or the owners of Telecom—if this Government does not get its own way when it has its back to the wall it just bullies them. 
Hon Dr MICHAEL CULLEN 
: The only examples of bullying of journalists that I know of have certainly come from the member’s usual bench mate who frequently bullies journalists and the press gallery know it. 
John Key 
: Is it not a fact that whatever way one cuts it it is just grossly inappropriate for a Deputy Prime Minister who is also the Minister of Finance and the Attorney-General to raise the tax affairs of a newspaper critical of its Government when those tax affairs depend crucially on the support by his Government of pending legislation; if he was not intending to bully the newspaper why did he include in his press release the fact that that money could be used for a lot of hip operations? 
Hon Dr MICHAEL CULLEN 
: Because I was pointing out to the  
New Zealand Herald 
 that a very large amount of money was involved and that for once it might care to be consistent in its position. Of course for that party—a party that accepted money from the Exclusive Brethren denied it had done so then admitted it and denied it knew about the pamphlets—to talk about consistency is unbelievable. 
Madam SPEAKER 
: I could not hear that answer. 
John Key 
: You didn’t miss much. 
Madam SPEAKER 
: Would the member please be seated. Could the Minister please summarise his answer and would members please have the courtesy to allow some of us to hear the answer. 
Hon Dr MICHAEL CULLEN 
: I think the brief summary is that the pot opposite is of a very dark colour. 
John Key 
: Is it normal behaviour in some countries for Governments to condition their support of certain legislation in return for political favours; if so is this the kind of behaviour he would like to see in New Zealand? 
Hon Dr MICHAEL CULLEN 
: As I said before all I was doing was challenging the  
New Zealand Herald  
journalists to explain the moral difference. They have failed to do so so far. 
John Key 
: Can the Minister confirm— 
Hon David Benson-Pope 
: Tell us about the Brethren at your house Mr Key. 
John Key 
: Go back to your tennis game would you? 
Madam SPEAKER 
: Interjections do provoke other interjections so I remind members please to show courtesy towards each other. 
John Key 
: Can the Minister confirm that he issued the press release against the advice of his own press secretary Mike Jaspers; and when we consider this coupled with the recent claims he has made against other journalists—that they are writing stories supportive of tax cuts solely on the basis of their own personal position—does that not show that he is rapidly losing not only objectivity but in fact credibility as New Zealand’s Minister of Finance? 
Hon Dr MICHAEL CULLEN 
: No not at all and I note recent opinion polls on the handling of the economy by this Government. I challenge that member to explain what promises with regard to accident compensation his party made to the insurance companies in return for their donations. 
Madam SPEAKER 
: Point of order—[ 
Interruption 
] Remember that there are no interjections during points of order. Point of order Rodney Hide. 
Rodney Hide 
: It is a supplementary question. Does the Minister deny attempting to bully  
New Zealand Herald 
 journalists; and what did he make of the Prime Minister’s advice to the Minister of Foreign Affairs Mr Winston Peters that launching a jihad on the  
New Zealand Herald  
was not the best course of action when in difficulties and trouble? 
Hon Dr MICHAEL CULLEN 
: I do not think even the  
New Zealand Herald  
journalists 
believe that I have the capacity to bully them. As a lifelong atheist I am the last person to launch a jihad in any shape or form. 
Railways—Overlander Service 
4.  
JEANETTE FITZSIMONS (Co-Leader—Green) 
 to the  
Minister of Finance 
: Is he sufficiently concerned about the demise of the Overlander service on 30 September to commit the Government to contributing financially to a rescue package; if not why not? 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 No because I am yet to see a sensible proposal for a rescue package. 
Jeanette Fitzsimons 
: In view of the almost total lack of marketing of the service and the growing international market for rail tourism would the Minister make a marketing campaign a condition of any Government-supported rescue package? 
Hon Dr MICHAEL CULLEN 
: I am yet to receive any proposals for a package other than our spending as much money as Toll wants to carry on the service in the future starting at $1.75 million a year plus $500000. It is worth noting that the train is capable of carrying only three carriages so in fact if it increased in popularity it would run out of carriages. I also believe that the carriages may be required for the Wairarapa suburban service within the near future. 
Te Ururoa Flavell 
: Tena koe Madam Speaker tena tatou katoa. What consultation has the Government undertaken with Tuwharetoa paramount chief Ariki Tumu te Heuheu the chairperson of the United Nations World Heritage Committee and what are the economic and cultural consequences that Tuwharetoa advise will result from the Government not supporting the financial viability of this service particularly given that the Tongariro National Park is on the World Heritage List? 
Hon Dr MICHAEL CULLEN 
: No I have not consulted and I have received no advice. Given the fact that in terms of travelling from Wellington to Auckland and back there are an average of about 50 people per day I doubt there will be that many economic consequences. 
Peter Brown 
: Will the Minister clarify the situation: is he not aware that Toll NZ has apparently told the local community that it is prepared to operate the service at cost—it just does not wish to operate the service at a loss—and has nobody put any figures to him along those sorts of lines? 
Hon Dr MICHAEL CULLEN 
: We do not have figures that I think would be easy to disentangle the cost of the Overlander outside the general passenger services that Toll provides. Certainly Toll would claim that it was making a loss on that route and certainly it has asked for $1.75 million a year. Given the number of people involved that seems a very heavy level of subsidy. 
Sue Kedgley 
: Is it sensible long-term planning to allow the termination of an iconic and potentially viable North Island long-distance passenger rail service resulting in a greater use of fuel cars and planes at the very time when international oil prices are rising sharply and New Zealand is struggling to meet its climate change commitments? 
Hon Dr MICHAEL CULLEN 
: I very much doubt that running an extremely large diesel engine with three carriages that are usually less than half full is more economic than running a bus or two with significantly smaller engines over that distance. 
Tariana Turia 
: Tena koe Madam Speaker tena tatou. What advice has the Minister given to Sue Morris the Mayor of the Ruapehu District Council who has sought a meeting with him to alert the Government to the way in which the economy of the district will be affected by the “loss of business operations and employment opportunities loss of tourism dollars and loss of transport options.”? 
Hon Dr MICHAEL CULLEN 
: I have not given any specific advice to Ms Morris but my general advice would be that I see very little future in this route as a standard passenger route. If there is to be a revived service of any sort I think it would be more likely to be a dedicated tourism operation along the lines of the Otago Excursion Train Trust and so on. I await any kinds of offers in that respect. My good friends the Auckland Regional Council perhaps could help by ceasing to charge $200000 a year for the train to be at the Britomart transport centre for half an hour twice a day. 
Jeanette Fitzsimons 
: Why is it that he is prepared to bail out Air New Zealand to the tune of $885 million and spend an additional $1.5 billion of taxpayers’ money on roads yet sit back and watch the Overlander go to the wall for the sake of less than $4 million? 
Hon Dr MICHAEL CULLEN 
: Because very few people travel on the Overlander compared with Air New Zealand. We do not export anything via the Overlander. We do not bring large numbers of tourists into New Zealand via the Overlander. The Overlander is not if I can overuse that much misused word the iconic symbol of the New Zealand travel industry overseas. 
Peter Brown 
: Does the Minister appreciate that I think most people in this House would see $1.7 million as a huge loss and would he be receptive to seeing some figures of a more modest level and consider a subsidy at least for a short term? 
Hon Dr MICHAEL CULLEN 
: I have been approached by a number of local authorities. My understanding at this stage is their notion of a business plan may be that we pay. I am waiting to see a business plan that has someone else also perhaps paying. 
Keith Locke 
: I seek leave to table a press release issued by the Auckland Regional Council last night calling for a continuation of the Overlander for an interim period of 12 months and the construction of a financial rescue package and an operational strategy saying that the service does have huge potential. 
Hon Dr MICHAEL CULLEN 
: Can I ask whether any member of the Auckland Regional Council who issued that statement has travelled on the train in the last year? 
Document by leave laid on the Table of the House. 
Labour Party Pledge Card—Chief Electoral Officer's Statement 
5.  
Hon TONY RYALL (National—Bay of Plenty) 
 to the  
Minister of Justice 
: Does he agree with the statements of the Chief Electoral Officer that the Labour pledge card and the A2-size pamphlet headed “Working together” “clearly encourages … voters to vote for the Labour Party” and that “the expenses of these publications should be included in your [Labour’s] return of election expenses.”; if not why not? 
Hon MARK BURTON (Minister of Justice) 
: 
 Madam Speaker it would be inappropriate for me to comment on what are legal interpretations of the Chief Electoral Officer made in the course of his duties under the Electoral Act 1993. 
Hon Peter Dunne 
: I raise a point of order Madam Speaker. In this part of the Chamber we heard nothing beyond “Madam Speaker” in the Minister’s reply. I wonder whether he could repeat the answer and whether it could be heard in silence. 
Hon MARK BURTON 
: It would be inappropriate for me to comment on what are legal interpretations of the Chief Electoral Officer made in the course of his duties under the Electoral Act 1993. 
Hon Tony Ryall 
: Has the Minister seen the letter from the Chief Electoral Officer sent on 2 September last year 2 weeks before the election to the Labour Party that clearly states that Labour’s pledge card should and must be included as an election expense and what action would he expect an honest political party to take having received such a detailed warning from the Chief Electoral Officer if it wanted to avoid acting corruptly? 
Hon MARK BURTON 
: I am aware of the letter the member refers to but it was not addressed to me. I have no ministerial responsibility for the correspondence in question. 
Hon Tony Ryall 
: I raise a point of order Madam Speaker. The Minister failed to address the question about what he would expect an honest political party to do that wanted to avoid acting corruptly having received that advice. 
Madam SPEAKER 
: The Minister is not responsible for what a party would do. 
Hon Tony Ryall 
: Has the Minister seen the advice of the Chief Electoral Officer sent on 12 September—before the election—that this fold-out brochure with a picture of a woman who purports to be the Prime Minister should be included in the Labour Party’s election expenses and what action would this Minister think an honest political party would take having received its second warning that this taxpayer-funded material should be declared an election expense to avoid acting corruptly? 
Madam SPEAKER 
: I just note that the Minister is not responsible for the party but if he wishes to address the question for matters he is responsible for then that is fine. 
Hon MARK BURTON 
: Indeed I am not the person who is responsible for the administration of the Labour Party. However I repeat to the member that it would be inappropriate for me to comment on what are legal interpretations of the Chief Electoral Officer made in the course of his duties under the Electoral Act 1993. 
Hon Tony Ryall 
: Can the Minister confirm that the Electoral Commission told the police that the Labour Party had spent more than it was legally permitted to and that this was referred to the police despite repeated warnings to the Labour Party from the Chief Electoral Officer and can the Minister confirm that under electoral law this is indeed a corrupt practice? 
Hon MARK BURTON 
: It would be inappropriate for me to comment on any legal interpretation of the Chief Electoral Officer in pursuit of his duties under the Electoral Act. I do not have ministerial responsibility for the police’s response. 
Hon Tony Ryall 
: Was the Minister advised by the Chief Electoral Office that 3 days before the election the Labour Party had offered to include the cost of this pledge card which includes the Minister’s picture in its election return but in the days after the election when the Chief Electoral Officer could not make a statement that would affect the election the Labour Party advised that it would not be including the cost of the pledge card in its election spending and can the Minister confirm that when a party breaks the law in that way it is indeed a very corrupt practice? 
Hon MARK BURTON 
: No I was not so advised but I would not expect to be because it is not within the realm of my ministerial responsibility. 
Hon Tony Ryall 
: Is the Ministry of Justice undertaking or has it undertaken any work on resolving the issues foreshadowed in the Auditor-General’s draft report on advertising from parliamentary funds; if so what is that work? 
Hon MARK BURTON 
: The ministry is undertaking a wide range of work around future electoral arrangements and I will be engaging on that work with members of the select committee. 
Work Permits—Ministerial Involvement 
6.  
Dr the Hon LOCKWOOD SMITH (National—Rodney) 
 to the  
Minister of Immigration 
: What involvement if any did the Minister have in respect of the case of Mr Sunan Siriwan either before or after the issuing of the special direction for a work visa to be granted as an exception to policy? 
Hon DAVID CUNLIFFE (Minister of Immigration) 
: 
 I have had no involvement with this case other than discussing it in preparation to answer parliamentary questions. 
Dr the Hon Lockwood Smith 
: What action did the Minister of Immigration take to review the special direction for a work visa for Mr Siriwan when he received a letter from a Mr Keith Williams dated 3 August 2005 alleging: “If Sunan Siriwan went to Samoa for 3 months to tile Mr Field’s house he would be given a work permit after 3 months by the New Zealand Immigration Service.”? 
Hon DAVID CUNLIFFE 
: I am advised there is no record that the then Minister of Immigration received that letter until an attachment to an email on 7 September 2005. He replied to the letter on 14 September 2005 and his office forwarded it to the relevant Minister the Associate Minister of Immigration on—[ 
Interruption 
] Madam Speaker either members opposite want to hear the answer or they do not. 
Madam SPEAKER 
: Just continue. 
Hon DAVID CUNLIFFE 
: I am quite happy not to give it but if they ask the question perhaps they may want to listen. 
Dr the Hon Lockwood Smith 
: What specific actions did the Minister of Immigration take to review the special direction to cancel the removal order for Ms Phanngarm when he received a letter from Mr Williams dated 3 August 2005 alleging that: “If Sunan Siriwan went to Samoa for 3 months to tile Mr Field’s house he would … be allowed to return to New Zealand. Following this outcome his wife and child would return to New Zealand from Thailand.”? 
Hon DAVID CUNLIFFE 
: I repeat that the advice I have received is that the Minister received that letter on 7 September 2005 and I have no advice to hand on what action may have been taken with regard to Ms Phanngarm. I would be happy to come back to the member on that point. 
Dr the Hon Lockwood Smith 
: What specific action did the then Minister of Immigration Paul Swain take to review the special direction for work visas for both Mr Siriwan and Ms Phanngarm when he was advised by Mr Williams in a letter dated 3 August 2005 that he Mr Williams knew of these arrangements by Mr Field because Mr Field had sent Mr Williams to Samoa to accompany Mr Siriwan and to do the waterproofing on Mr Field’s house in Samoa? 
Hon DAVID CUNLIFFE 
: To cut a long story short I would say that Mr Ingram found that Mr Williams’ claims were without credibility. 
Dr the Hon Lockwood Smith 
: Did the Minister of Immigration discuss with Taito Phillip Field the allegations contained in the letter he received from Mr Williams dated 3 August 2005 when that letter clearly outlined a possible conflict of interest in the actions of Taito Phillip Field during his ongoing representations to the Associate Minister on behalf of Mr Siriwan and his wife Ms Phanngarm; if not why not? 
Hon DAVID CUNLIFFE 
: As I have described the then Minister received the letter from Mr Williams on 7 September. He took the appropriate action which was on 12 September to forward to the Associate Minister who was the Minister acting on the case a copy of that letter. He acknowledged to Mr Williams on 14 September that his mail had been received. 
Dr the Hon Lockwood Smith 
: Is the reason the Minister of Immigration the Hon Paul Swain took no specific actions following his receipt of the letter from Mr Williams dated 3 August 2005 that Mr Swain was fully aware of the involvement of Mr Siriwan in the work for Mr Field at his house in Samoa because the Minister had met Mr Siriwan at Mr Field’s house on or about 18 March 2005 in Samoa? 
Hon DAVID CUNLIFFE 
: While Mr Swain has freely admitted that he may have met Mr Siriwan on a chance visit to Mr Field’s house it is very clear from the Ingram inquiry and subsequent press reporting that Mr Swain played no part in the decision to grant Mr Siriwan’s discretion. 
Accident Compensation—System Announcements 
7.  
Hon MARK GOSCHE (Labour—Maungakiekie) 
 to the  
Minister for ACC 
: What recent announcements has she made concerning New Zealand’s ACC system? 
Hon RUTH DYSON (Minister for ACC) 
: 
 Last week I announced a forthcoming merger of the Accident Compensation Corporation (ACC) self-employed work account and the ACC employers account. These accounts were separated solely for the purpose of privatisation. Our Government is committed to a fair and simple accident compensation scheme and it is our intention to continue to make accident compensation levy rates fairer for all. 
Hon Mark Gosche 
: Has she received any other reports regarding potential changes to New Zealand’s world-class accident compensation system? 
Hon RUTH DYSON 
: Yes I have. I was stunned to read recently of a policy release from the National Party. Sadly it was a rerun of the party’s 1990s privatisation agenda driven either by dogged pursuit of ideology or by the price the National Party has to pay for campaign funding from the insurance industry. 
Tariana Turia 
: Tena koe Madam Speaker. Is the Minister aware of the research from Dr Peter Jansen on Maori consumer use and experience of health and disability and ACC services that reveals Maori are currently not receiving entitlements to care rehabilitation and compensation at a level comparable to the proportion of Maori in the population and how can she explain this given the research also reports that Maori have greater need but less access to treatment? 
Hon RUTH DYSON 
: Yes I am familiar with that research and I share entirely the concerns indicated by the member in her supplementary question. It is obvious from statistics about workplaces for Maori in New Zealand that they are overrepresented in high-risk industries and under-represented in claims and entitlements from ACC. I am committed to ensuring that all New Zealanders receive the compensation and rehabilitation to which they are entitled. 
Criminal Justice System—Prime Minister's Comments 
8.  
SIMON POWER (National—Rangitikei) 
 to the  
Minister of Justice 
: Does he agree with the statement of the Prime Minister in her speech on proposed changes to the criminal justice system last week when she said in comparing the increased number of prison inmates to the overall reduction in reported crime that “Something doesn’t add up.”? 
Hon MARK BURTON (Minister of Justice) 
: 
 Yes. 
Simon Power 
: How does he reconcile the Prime Minister’s statement that “Something doesn’t add up.” with his own statement the same day that the impact of the Sentencing Act is “the lowest crime rate since the early 1980s.” according to him; if he is right in stating that locking up more offenders has reduced crime can he remind the public why he is letting them out earlier by knocking a quarter off their sentences? 
Hon MARK BURTON 
: The maths is simple. As well as the lowest offending rate of course we have a much higher clearance rate by the police and quite a number of lower-end offenders are being sent to jail as well. 
Simon Power 
: They’re all in jail. That’s why they’re not committing crime. Sort it out. 
Hon MARK BURTON 
: That is exactly what we did I say to Mr Power. We are sorting it out with a raft of announcements that will make a difference and that will give the courts a raft of alternative sentences for front-end offenders. 
Simon Power 
: How can the 92 percent who voted for tougher sentences in 1999 view the Government’s announcement last week that sentences would be reduced by a quarter as anything other than a U-turn when in 2002 the Prime Minister told the House that the sentencing and parole legislation “realistically addresses the public’s legitimate concerns about longer sentences for the most serious crime.”? 
Hon MARK BURTON 
: Simply because as the member quite well knows the Law Commission advice also said that the minimum sentence served should be two-thirds so of course the actual time served would be roughly equivalent even if there was an average 25 percent cut. In addition of course nothing in what the Government announced last week would reverse the decisions made in 2002 to ensure that serious repeat and violent offenders are locked up for longer—as indeed they are. 
Simon Power 
: Has he or the Prime Minister apologised to former Minister of Justice Phil Goff for repudiating the sentencing and parole legislation that he staked so much political capital in when he so proudly greeted news of the rising prison population as it “confirms that the Government is delivering on its promise to take a tougher approach to crime” or is he happy to see the next Labour leader succumb to the “trade Minister’s curse”? 
Hon MARK BURTON 
: Far from what the member suggests this builds on the good work Phil Goff did as Minister of Justice. As Minister of Justice Phil Goff was absolutely correct to ensure that serious repeat and violent offenders are getting longer sentences and serving longer sentences. What Phil Goff does not want and what this Government does not want is for first-time offenders and low-level offenders to get prison sentences when there are better alternatives that do a better job and are more effective. 
Nandor Tanczos 
: Does the Minister agree that many of the excellent proposals for reducing crime contained in this package such as an increased focus on early intervention and crime prevention greater access to restorative justice a greater array of alternative sentences available for judges and more resources for rehabilitation alcohol and other drug treatment mental health education and work skills sound suspiciously like the policies advocated by the Green Party since being elected to this Parliament; when will we see more Green Party proposals announced by the Government such as a public prosecutor’s office? 
Hon MARK BURTON 
: I think it is fair to say that those members who care to look with any degree of honesty at the package announced last week will see that many of the aspirations of well-intentioned members of this House are contained in that package. I look forward to the day when all parties in this House can support positive and effective justice interventions. 
Simon Power 
: Does the Minister recall the Prime Minister stating at Labour’s campaign launch in 2002 that “Judges can now impose minimum periods before parole of up to two thirds of a sentence for serious offenders.” as in the case of a rapist who was sentenced to 17 years but was not eligible for parole until 10 years; now that he is proposing a 25 percent discount on the nominal sentence can he confirm to the public of New Zealand that will mean that in circumstance a rapist could be out in 8½ years? 
Hon MARK BURTON 
: No again because if the member were to treat the facts and present them rather than to play politics with them he would also have reported that there is no suggestion of a blanket 25 percent tariff. There is clearly an indication of intent that each category of offence would be considered and sentencing guidelines would be created by a sentencing council. That could indeed result in some sentences going up and some going down. 
Simon Power 
: Can he confirm that it was the Law Commission that approached the Government with strategies for managing the rising prison population on 2 December 2005 not the other way around—which was coincidentally at the same time that Cabinet was told it would need to cough up even more money to cover the prisons blowout—and can he tell us who the real Minister of Justice is: himself the Prime Minister or Sir Geoffrey Palmer? 
Hon MARK BURTON 
: Firstly I can say to the member that the work on effective interventions began before December last year. Secondly clearly the ministerial warrant for justice sits with me. 
Employment—Statistics 
9.  
GEORGINA BEYER (Labour) 
 to the  
Minister for Social Development and Employment 
: What reports has he received on the number of New Zealanders employed and unemployed? 
Hon DAVID BENSON-POPE (Minister for Social Development and Employment) 
: 
 I am pleased to inform the House that the household labour force survey for the quarter ended June 2006 shows that the unemployment rate has fallen 0.3 percentage points to 3.6 percent. That is New Zealand’s equal-lowest unemployment rate on record. Labour force participation has increased to 68.8 percent—the highest rate ever recorded—and 2129000 New Zealanders are now in work which is the highest level of employment ever recorded and which is up 22000 from the previous quarter. These results are I believe a strong endorsement of this Labour-led Government’s management of the economy. 
Georgina Beyer 
: What other reports has he seen with regard to the household labour force survey? 
Hon DAVID BENSON-POPE 
: I have seen expert comment from the Westpac Banking Corporation that: “The unemployment rate is back to historic lows employment growth was remarkably strong”. That bulletin also states: “The results are in sharp contrast with business surveys”. I have also seen a report about why this contrast might be so: “There has been a pattern emerging of companies shedding employees and while it is a small stream it is constant. That reflects the economic slowdown and it is only starting to be felt on the employment front.” That was John Key in April this year talking down the economy and demonstrating his ignorance of the fact that we have a dynamic labour market where for every 23 jobs lost 26 are created. That equates to 44000 more people in work now than at the beginning of this year. 
Ingram Report—Labour Department 
10.  
Dr WAYNE MAPP (National—North Shore) 
 to the  
Minister of Labour 
: Does she accept that the Department of Labour should fully investigate the nature of the work relationships raised in the Ingram report in light of Dr Ingram’s statement that “if any of those issues [are] to be pursued further that task would need to be undertaken by some appropriately authorised authority”; if not why not? 
Hon RUTH DYSON (Minister of Labour) 
: 
 No. The department has advised Dr Mapp that the work relationships referred to in the Ingram report appear not to be employment relationships and that therefore the department does not intend to investigate these matters further. The department remains ready to receive any evidence or worker complaint that might suggest it should reconsider its view. Decisions on investigations are an operational matter for the department. 
Dr Wayne Mapp 
: How can the Minister believe that the department has satisfied its obligations under the Employment Relations Act 2000 and the minimum wage legislation to determine whether the immigrants were employees when in fact all the department has done is actually read the report—which the rest of us have done as well? 
Hon RUTH DYSON 
: Well the latter comment is not verified by the quality of the member’s questions frankly. It is obvious in the Ingram report that the nature of the employment relationship was not one of a direct employment relationship but one of a contractual relationship. As I have explained to the member before in the House contractual relationships do not have any minimum wage provisions in New Zealand law at the moment. 
Dr Wayne Mapp 
: How can the department’s inquiry be regarded as complete when it consisted of simply reading the Ingram report and did not involve interviewing any of the people concerned—whether the immigrants who worked on Mr Field’s numerous properties or indeed Mr Field himself? 
Hon RUTH DYSON 
: The department did read the Ingram report. It did discuss with the author whether any additional information was available and was told there was no further information available. It is not at all evident there is any employment relationship. Once again I invite the member to provide the department with any information he has in which case he has a written commitment from the department to reconsider its view. 
Darien Fenton 
: What reports if any has the Minister received concerning entitlements under New Zealand employment law? 
Hon RUTH DYSON 
: I have seen a report that explains that under New Zealand law there is no minimum wage in the contractual relationship situation. That issue is addressed in a member’s bill in the name of the member asking the supplementary question—Darien Fenton. I certainly look forward to the support of the National Party for that bill because it does address the very issue that National is raising concerns about. 
Dr Wayne Mapp 
: As Dr Ingram specifically said in his report that he was “concerned by the unsatisfactory nature of the explanations provided by Mr Field” why would the department not interview the people concerned rather than just reading the report? 
Hon RUTH DYSON 
: Because there is no evidence or implication at all that any employment relationship is involved in the issues outlined in the Ingram report. If the member has any further information to provide then he should hand it over to the department and it will reconsider its view. 
Dr Wayne Mapp 
: Is the Minister aware that Dr Ingram in his report said that Mr Field gave three different stories on each of the three times he was interviewed in relation to the work at 51 Church Street and surely that requires the department to actually interview the people concerned? 
Hon RUTH DYSON 
: The department has an interest in investigating issues of an employment relationship only not of a contractual relationship because there is no minimum wage protection under a contractual relationship. 
Dr Wayne Mapp 
: Does the Minister have any concerns that Dr Ingram was not satisfied about even the authenticity of the invoices provided by Mr Field for the work at 51 Church Street and surely that means the department must investigate whether these people were in fact employees because the invoices are quite probably false? 
Hon RUTH DYSON 
: No. 
Surgery—Canterbury District Health Board Classification 
11.  
BARBARA STEWART (NZ First) 
 to the  
Minister of Health 
: Has his ministry ever researched possible methods of separating acute surgery from elective surgery as advocated by senior medical staff in Christchurch following the culling of 5121 patients from Canterbury District Health Board waiting lists? 
Hon PETE HODGSON (Minister of Health) 
: 
 Yes the ministry is well aware of some very interesting work in this area that is actually being pioneered at the Canterbury District Health Board and believes that it will help increase the elective surgery throughput—indeed throughout New Zealand if some of those ideas were to travel. 
Barbara Stewart 
: Does he expect the public system to have the increased capacity necessary to perform all of the elective surgery required; if so when? 
Hon PETE HODGSON 
: The member may or may not be aware that in the case of the Canterbury District Health Board my predecessor the Hon Annette King released more than $20 million 15 months ago to build four new theatres just to the north of the city. They are due to open in March of next year and will be used either substantially or exclusively for electives. 
Maryan Street 
: What reports has he received on the amount of in-patient activity in New Zealand’s public hospitals? 
Hon PETE HODGSON 
: Data released today shows that the 2005-06 financial year was the busiest year on record in New Zealand’s public hospitals. It shows that since the election of the Labour-led Government total surgery numbers are up by just over 5 percent and elective surgery within that is up by just over 6 percent. Medical cases have increased by 29 percent. Whichever way one looks at it more people are being treated in our hospitals than ever before. [ 
Interruption 
] 
Hon Trevor Mallard 
: I raise a point of order Madam Speaker. I know that standards have dropped somewhat but the comment from Tony Ryall was clearly out of order. 
Madam SPEAKER 
: Would the member please— 
Hon Tony Ryall 
: I apologise. 
Barbara Stewart 
: Does the Minister consider that managing surgical waiting lists by imposing financial penalties on district health boards is an acceptable long-term strategy; if so why? 
Hon PETE HODGSON 
: I think the best way to answer that question is to say that the Canterbury District Health Board has decided that the future is best managed by promising what can be delivered and not more than that. It is not acceptable to make a promise and then break it. It is not acceptable to say “yes” to all comers when some people need attention faster than others. That is the basis of the booking system introduced under National. 
Barbara Stewart 
: Is he aware that Christchurch Hospital is reportedly failing to meet international standards of the speedy treatment of gallstones and risks compounding the problem by axing gallstone sufferers from its elective waiting lists and when can those patients expect any improvement in their situation? 
Hon PETE HODGSON 
: As it happens yes I am aware. The Canterbury District Health Board is seriously considering treating all gall bladder removals as acute cases. It is under serious consideration now. 
Land Tenure—Report 
12.  
Hon DAVID CARTER (National) 
 to the  
Minister for Land Information 
: Why did the Government commission the report from Donn Armstrong on the land tenure process and when will it be released to all interested parties? 
Hon DAVID PARKER (Minister for Land Information) 
: 
 The Government commissioned the report as part of its work on rentals for high country pastoral leases. I recognise the interest in the report and hope to be in a position to release it next month. 
Hon David Carter 
: Why did he tell the South Island high country Federated Farmers conference on 9 June that he would release the report by the end of June; why has he failed to do so? 
Hon Dr Nick Smith 
: He lies like everybody else in the Government. 
Madam SPEAKER 
: Would members please restrain themselves. 
Hon DAVID PARKER 
: I had hoped to release the report before now. The delays have been caused by my desire to seek legal advice to ensure that the provisions of the Land Act and the Crown Pastoral Land Act are correctly applied. 
Hon David Carter 
: Why did he write to the Primary Production Committee on 27 June stating that he would make the report available to the select committee by the end of July—and again he failed to do so? 
Hon DAVID PARKER 
: The reason for the delay is the same. I say again that the reason for the delay was that I sought legal advice to ensure that the provisions of the Land Act and the Crown Pastoral Land Act are correctly applied. 
Hon David Carter 
: What is so unpalatable in this report that it prevents him from releasing it; or is there some other reason that he is not prepared to make it available to the high country farmers? 
Hon DAVID PARKER 
: There is no hidden agenda here but I am determined that the Crown correctly apply the provisions in the law to ensure that we charge and receive the legally mandated rents. 
R Doug Woolerton 
: What action does the Government intend to take if indeed the report finds that the method of land valuation used so far in the land tenure process has either been flawed or unfair? 
Hon DAVID PARKER 
: I am as I said in reply to the prior question of the view that the department has no choice but to apply the rent-setting provisions in the Land Act and the Crown Pastoral Land Act. 
Hon David Carter 
: How much money did the taxpayer pay for this report which the Minister to date has hidden from taxpayers? 
Hon DAVID PARKER 
: I do not have that number with me today. 
General Debate 
Dr DON BRASH (Leader of the Opposition) 
: 
 I move  
That the House take note of miscellaneous business 
. A few weeks ago I accused Helen Clark of leading the most corrupt Government in New Zealand history. In the last few years we have seen “paintergate”—do members remember that—when Helen Clark forged her name on a painting she did not paint. We have seen “Doone-gate”—do members remember that—where Helen Clark bad-mouthed the Commissioner of Police to the media and then claimed she had not done so. We have seen Helen Clark allow the driver of a Crown car and five police officers take the rap for driving her through South Canterbury at 160 kilometres an hour—do members remember that? We have seen Helen Clark deny that she knew the Treasury estimate of the cost of the interest-free student loan bribe—and indeed deny that she knew that Treasury had even done such an estimate—only to have the denial categorically refuted after the election. 
In the last few months we have seen Helen Clark set up an inquiry into very serious allegations of corruption against a member of her caucus but set it up in such a way as to guarantee that it could not deal with the most serious allegations. Then we have seen her refuse to set up a proper inquiry and to allow the serious allegations to hang over the House and taint the reputation both of the member concerned and of Parliament more generally. 
Now we have the grandaddy of them all: it is now clear that Helen Clark has been told by no fewer than four different official agencies that spending on her infamous pledge card was election spending. First the Auditor-General told the Labour Party in June last year—3 months before the election—what was and what was not election spending and that advice made it clear that anything as explicitly electioneering as the pledge card would be election spending and should not be financed from taxpayers’ money. There can be no doubt that the Auditor-General’s report to Helen Clark in the last few weeks confirmed that. 
More than 2 weeks before the election as my colleague Tony Ryall pointed out the then Chief Electoral Officer David Henry advised Mike Smith the Labour Party secretary—in writing—that the pledge card was election spending and should be included in Labour’s electoral spending limit. The Electoral Commission then referred the pledge card to the police and argued that prima facie expenditure on the card took total Labour expenditure above the legal amount the party was allowed to spend. Finally the recent letter from the Solicitor-General to the Auditor-General makes it clear that funding the pledge card was election spending. Four official agencies made the position clear. The police investigating the matter also found a prima facie case that the law had been breached. 
In reality two laws were broken. First the Labour Party exceeded the legal limit it was allowed to spend on its campaign by almost half a million dollars—roughly the cost of the pledge card. Had my colleague Bob Clarkson been shown to have deliberately overspent his modest $20000 limit he would have forfeited the Tauranga seat in the election. Labour exceeded the limit by almost half a million dollars and Helen Clark wants us to ignore it. Secondly the Auditor-General has made it clear that the Labour Party used large amounts of taxpayers’ money in clear breach of the rules. 
And what does Helen Clark want us to do? She wants us to believe that the rules are unclear or that all political parties have been doing it since 1989 or that we should talk about raiding more money from the taxpayer’s pocket for the next election or that we should hold an inquiry or that this is just a “beltway” issue of no interest to the country outside Wellington. 
This is an outrage; Helen Clark stole the election. Not content with enormous bribes to voters with other people’s money she had to misappropriate half a million dollars of taxpayers’ money to fund her campaign. She should pay the money back. She should then resign go to the country and have a fair election. 
Hon Dr MICHAEL CULLEN (Deputy Prime Minister) 
: 
 Madam Assistant Speaker—[ 
Interruption 
] 
The ASSISTANT SPEAKER (Ann Hartley) 
: Order! 
Hon Dr MICHAEL CULLEN 
: Thank you Madam Assistant Speaker—[ 
Interruption 
] 
The ASSISTANT SPEAKER (Ann Hartley) 
: I am on my feet. I have called for order and members will come to order. 
Hon Dr MICHAEL CULLEN 
: Thank you Madam Assistant Speaker. The good news for Don Brash is that there will be a job for him once he retires. He can get the job as the option in the Energiser battery ad because he has shown yet again that he simply is not up to it at all. That from the man—[ 
Interruption 
] 
Martin Gallagher 
: I raise a point of order Madam Speaker. [ 
Interruption 
]  
The ASSISTANT SPEAKER (Ann Hartley) 
: I will remind members that points of order will be heard in silence. 
Martin Gallagher 
: Madam Speaker—[ 
Interruption 
] 
The ASSISTANT SPEAKER (Ann Hartley) 
: I will just remind that member who spoke that that is his final warning. 
Martin Gallagher 
: As the elected member for Hamilton West I do not believe it to be unreasonable that I should be in a position to hear the Deputy Prime Minister of this country in this Chamber—or to hear any other speaker for that matter. I understand that interjections should be rare and reasonable. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I will just—[ 
Interruption 
] There will be order while I am ruling on a point of order. The member makes a perfectly valid point of order which is that all members are entitled to hear. The barraging was way beyond interjections. 
Hon Dr MICHAEL CULLEN 
: That speech was from the man who was forced to admit election overspending. That man was forced to admit that that party overspent because it did not pay its GST when he was the one who headed the committee that set up GST. That man has yet to explain his close personal links with the Business Roundtable. Come on I say to Don Brash—he should tell us about his close personal links with the Business Roundtable. [ 
Interruption 
] That man who is yet to explain— 
The ASSISTANT SPEAKER (Ann Hartley) 
: Would the member please be seated. This is just way beyond interjections. No members can hear the member who is speaking now. I have stopped the clock and the member will continue his speech until members can hear it. Nobody can hear what is going on. 
Hon Dr MICHAEL CULLEN 
: I raise a point of order Madam Speaker. The noise was so loud that I request that I get to start my speech again from the beginning and that that will continue until there is a reasonable level of quietness in the House. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Right I will rule on that point of order. That is exactly what will happen until members can hear other members speak. The member will start his speech again and he will start with 5 minutes’ speaking time. 
Dr Don Brash 
: I raise a point of order Madam Speaker. Can I also give my speech again on the same grounds? [ 
Interruption 
] 
The ASSISTANT SPEAKER (Ann Hartley) 
: Please be seated; I am on my feet. The barraging has come from the member’s party as the member knows and it is—[ 
Interruption 
] Look a member is going to go out in a minute. You have had your final warning. I gave a warning to members over there. When I am on my feet and when a point of order is being heard there will be silence. I say to the member again that the barraging from the member’s party means that nobody can hear what is going on and certainly during the member’s speech most of the noise came from the member’s own party. 
Hon Dr Nick Smith 
: I raise a point of order Madam Speaker. I simply ask for some consistency in your rulings. During the entire speech—the very good speech—that was given by the Leader of the Opposition the front bench of the Labour Party continuously barracked. The only way I could listen to that good speech was to push my ear right up to the speaker in exactly the same way—[ 
Interruption 
] 
The ASSISTANT SPEAKER (Ann Hartley) 
: There will be silence during points of order. 
Hon Dr Nick Smith 
: If she was on our side you would kick her out—but never mind. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member will be seated. 
Hon Dr Nick Smith 
: It’s true. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member will stand withdraw and apologise for that remark. Before he does that the ruling I would give is clearly about the amount of interjection—and it was interjection; I was listening very carefully and it was not continuous barraging. There is a concerted effort this afternoon to have continuous barraging and it will not be tolerated. 
Hon Dr Nick Smith 
: Point of order— 
The ASSISTANT SPEAKER (Ann Hartley) 
: No I have ruled on that point of order. It had better be a new point of order. 
Hon Dr Nick Smith 
: I raise a point of order Madam Speaker. My point of order is quite simply that you need to be consistent and if you are going to allow Dr Cullen to start his speech again you must simply apply exactly the same rule to Dr Brash’s speech because there was exactly the same continuous barracking during the course of his speech and you chose not to intervene. I can only draw the conclusion that there are different rules in this House depending on whether members are on your side or the other. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member’s point of order and the argument he makes are completely out of order. The member knows that he cannot make those allegations. The point I am making is that there were interjections when the member Don Brash was speaking. There was not continuous barraging—and that is what all members in the House are complaining about. That is why the member will start his speech again at 5 minutes. 
Rodney Hide 
: I raise a point of order Madam Speaker. May I suggest as a way forward that not only does Dr Michael Cullen get to start his speech again but you rule that the next two speakers be heard in silence. Otherwise it is hopeless because you have had repeated rulings. If we hear the speeches in silence then maybe members can learn the difference between interjecting in a way that is witty and barraging. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Well this is a robust debate. We try to have the Wednesday debate as a robust debate but the member does make a good point. It has got to the point this afternoon where there has been that continuous decision I think to have barraging by one party—which is completely disrupting the whole House this afternoon. I will continue and we will see what happens if members stop the barraging and make fair interjections. I thank the member for his point of order. 
Hon David Benson-Pope 
: I raise a point of order Madam Speaker. Earlier you directed Dr Smith to withdraw and apologise. I do not believe that he has in fact done so yet. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I did not actually ask him to withdraw and apologise. I did reprimand him for what he said. I have warned him that what he said was out of order. 
Dr the Hon Lockwood Smith 
: I raise a point of order Madam Speaker. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Is it a new point of order Dr Smith? 
Dr the Hon Lockwood Smith 
: Of course it is Madam Assistant Speaker. It may just assist members on this side of the House if you could explain what “barraging” means. I have heard of the word “barracking” but I am not sure what “barraging” means. It may just assist matters. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member may be trying to be rather smart. I said “barracking”. [ 
Interruption 
] A member will go out in a minute if there cannot be some semblance of order. 
Dr the Hon Lockwood Smith 
: I raise a point of order Madam Speaker. No member of this House is entitled to mislead the House not even the Speaker. I am sure that if you check the  
Hansard 
 you will find that you have referred to “barraging” many times in recent minutes and members on this side of the House are at a loss to know what on earth you mean. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I think members are very clear about what I have said. 
Hon Dr MICHAEL CULLEN 
: Speaking to the point of order Madam Assistant Speaker the member is correct; you did say “barraging”. It is an interesting neologism because a barrage of course is a massive onslaught of noise and one can therefore coin the verb “to barrage” from that. The translation of nouns into verbs is quite a common modern linguistic habit. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I think the member who raised the point of order is perfectly clear about what is happening this afternoon and I do not think it needs to be explained any further. 
Hon Dr MICHAEL CULLEN 
: One could say a number of things about Dr Brash’s speech. The most interesting point is that when some newspaper latched upon a strange rumour that the Prime Minister was going to become the Secretary-General of the United Nations Dr Brash said he would support the nomination. Yet this afternoon he said that the Prime Minister leads the most corrupt Government in New Zealand’s history. Well that is a great way to set himself up for the future if he ever visits the United Nations. But of course that was a demonstration of the “new” Leader of the Opposition—the man with guts. It was a phrase invented for Gerry Brownlee but kindly donated by him to Don Brash who is a man of principle. 
Hon Dr Nick Smith 
: Tell us about the money! 
Hon Dr MICHAEL CULLEN 
: Indeed the National Party overspent its election spending because it did not count GST despite the fact that its leader headed the committee that set up GST. 
We were told by members of the National caucus yesterday that they had a disastrous caucus because they cannot agree over their leadership and their style. This is the man of guts and principles. Now what does guts mean from Dr Brash? Guts means saying very naughty words quite often. He has now said “bloody” three times in the last 2 weeks. He even said like a demented Shakespearian pretender to the throne “bastards”. Like “bastard of Normandy” or “bastard of Kent” he said “bastards”; then twice he said a very big gutsy word—“crap”. Oh! And those words seared themselves to the heart of this Government. We had never been so savagely attacked before. 
But where are the principles? He said: “I would work with the devil to get rid of this Government.” Did he tell the Exclusive Brethren that? Did he tell them that he would work with the devil to get rid of this Government? Where is he on the nuclear issue when he wants it gone by lunchtime then for the election he says that no he supports a nuclear-free stance? Where is he on State-owned enterprise sales when he supports the sale of State-owned enterprises but his policy was that he would not sell State-owned enterprises? Where is he on New Zealand superannuation when he said he wanted to raise the age of entitlement but his policy was not to raise the age of entitlement? Where is he on the labour market when he said that he wanted to end 4 weeks’ holiday but the promise was not to end 4 weeks’ holiday? 
But the doozy of them all of course is the Exclusive Brethren. What is the story on that member? On the one day he said: “I don’t know who is responsible for the pamphlets.” 
Hon Dr Nick Smith 
: That’s right. 
Hon Dr MICHAEL CULLEN 
: That is right—from the man who said that the Exclusive Brethren destroyed families in the name of Christianity. That is what Nick Smith said about them. 
Then the next day Dr Brash said: “I know it’s not the National Party that did the pamphlets.” The next day he said: “They haven’t offered me financial support.” The next day he said: “We met. We discussed the pamphlets. We knew about them. We knew about the money. We knew about the content. We lined it all up.” But 3 days earlier that man of principle and guts had denied any knowledge at all and there is a four-letter verb that describes that particular action on the part of that member. Mr Key is staying very quiet because he knows who the person is who introduced Dr Brash to the Exclusive Brethren—but more of that later when Mr Peters returns to Parliament some time within the next few weeks. 
What about National’s other spending? What about Bill English’s billboards? What about the foreshore and seabed billboards? What about the postcards that went out this year paid for by Parliamentary Service on tax cuts? What about the full-page advertisement in the newspaper on PlunketLine paid for by Parliamentary Service not by the National Party? What about the advertisement just yesterday from “Bob the Builder” Clarkson “come on jokers let’s attack the nanny State” with the parliamentary crest on the bottom right-hand side paid for by Parliamentary Service? What about the flight down to Nelson to say hello to Ian Ewen-Street as a new member of Parliament paid for by Parliamentary Service? What did that have to do with anything other than trying to persuade people to vote for the National Party? 
These people do not have their hands in just the public till they have their hands in every other till as well. What they will not tell us is what they have promised in return for all the money that has flowed in. 
KEITH LOCKE (Green) 
: 
 The Green Party has had a tremendous reaction from around the country since we launched a petition yesterday at both the Auckland and Wellington railway stations calling on the Government to guarantee the continued operation of the iconic Overlander passenger service for the next 2 years while the following important steps are undertaken: a study is initiated to assess the long-term viability of the service; an integrated marketing campaign is conducted to further increase passenger numbers; and the necessary resources are invested by ONTRACK to return the rail track back to a standard that will allow the service to run reliably. 
We have had support from around the country. All kinds of people are helping with that petitioning across the country. By and large Dr Cullen’s response to questions from Jeanette Fitzsimons and Sue Kedgley in the question period today was disappointing. It is true and we are at least heartened by the fact that he did not rule out some form of future service and that he talked about it as a possible tourist service. But I think it is important—and councils across the North Island are calling for this—to keep the service going in the meantime because it will be much harder to resurrect the service when it runs out completely than it will be to keep it in operation for 6 months 12 months or as our petition proposes for 2 years while we take the steps suggested in that petition. It is not as if it will be a huge burden on the Government’s budget. 
Of course there has to be negotiation over what the Government’s financial contribution might be and in what way the Government becomes involved. Toll suggests $1.75 million and a $500000 injection to help with the rolling stock. That is not an excessive amount. It should be negotiated to see whether it is appropriate for that level but it would not break the Government’s budget particularly when we are talking about an iconic service that has been going for 98 years. Folk songs have been written about it etc. 
The thing that I picked up at the Auckland railway station yesterday and which I have picked up across the country is that it is part of New Zealand’s culture and we should maintain it at all costs. It is true that the patronage has dropped as Dr Cullen mentioned in one of his replies. It has dropped from 90000 to 50000 over a 2-year period. But the main reason for this is not that people are just taking the cheap air fares—cheap air fares have been in operation beyond that period. I think the real reason is the reliability of the service. A 12-hour service in the summer can take up to 14 hours. It could be that the service would take a much shorter time if the proper maintenance work was done on the track. There has been delayed maintenance since the privatisation of the railway back in 1993 and it is good that the Government has taken back the track and put some money into the development of the railway. But much more money is needed and the development needs to be sped up. 
All the marketing and tourism people say that the railway could be a huge success but it needs marketing. Most of the tourist operators have pulled back on the marketing because it is not a reliable service. So reliability is the key here. Subsidies work around the world. The Australian Government gives subsidies to the Great Southern Railway and that has increased patronage over recent times by 40 percent—although if our railway were marketed properly it probably would not need a subsidy. 
We should see it as iconic. What the Maori Party member asked in question time today was very relevant. This railway goes through two key Maori areas. The first is the Tainui area. Government members have been down at Turangawaewae celebrating the appointment of the new king and we heard today that the king is in favour of keeping that service if at all possible. It is part of his people’s cultural heritage. Similarly with the Tongariro National Park having been granted to this nation by Ngati Tuwharetoa the train service is particularly appropriate. It already stops at National Park. 
Hon STEVE MAHAREY (Minister of Education) 
: 
 It is good to be back in the House. I always like to be back here just across the way from Mr Nick Smith. It is always good to see him back into the therapy here which seems to be what he relies upon—to come and sit here and barrack across the House. Every time we get back here we see the National Party members all lined up there and it reminds us again why it is so important to have a Labour Government with the support of people like Judy Turner and so on to make sure that the country is led by people who are reasonable and decent and not like the National Party members. 
Have members noticed that during the adjournment breaks we never hear a single thing from National Party members? It is as if they actually need the House because they are so lazy and hopeless that without the House with the press gallery conveniently looking at them as they sit here to report their words they can do absolutely nothing. We never hear a single word from them. Without the House Maurice Williamson would be a completely unknown figure. National members have to be able to be here. 
Meanwhile we on this side of the House have had a tremendous adjournment break. We have been out promoting all sorts of things like how to reduce the prison population. We have been visiting our electorates. All the regional newspapers are full of Labour MPs. Meanwhile there is nothing from the National Party except about the election spending issue which boils down of course to the use of the crest. For the benefit of those who are listening today I say that the crest means that one has used Parliamentary Service’s money. The National Party claims to be clean on this issue and its members want to pretend that everybody else but not them is somehow rorting the system. 
I just got in about 3 seconds flat some examples of National Party material. This is from its website. This material is from the National Party’s “Waste Watch—keeping an eye on your money” website which basically tells me I ought to vote for the National Party. Oh! There is the crest on it! It must be paid for by Parliamentary Service. And here is material from the www.axecarbontax.co.nz website. Again it is from the National Party and is basically asking us to vote for it—and there is the crest on the material! It must be paid for by Parliamentary Service. 
Here is a brochure that is not from the website. This is a brochure about what the National Party stands for and it is actually asking us to vote for the National Party. What do I find? Oh! There is the crest on it! It must have been paid for by Parliamentary Service. 
 Here is Don Brash in shirtsleeves looking like a dangerous rocker-type person. The National Party is advertising that Don Brash is holding a Wellington meeting—and there is the crest! A political meeting is being advertised and votes are wanted by the National Party. Here is a large notice about the Foreshore and Seabed Bill. It states the National Party’s position and asks people to vote for National on that—and there is the crest again! What is this one here? This ad states that National backs PlunketLine. The National Party could not have cared less about PlunketLine in 1990 but it does now. 
Here is a big ad in the newspaper—oh there is the crest again! The ad was paid for with Parliamentary Service money. Here is an ad asking whether we are sick of the nanny State and asking good jokers out there to unite. There is an indigenous person on it. “Bob the Builder” is wasting his time. “Bob the Builder” is telling us to come to a meeting with him paid for by Parliamentary Service. All of these things are paid for by Parliamentary Service. 
We might like to say something too about the Exclusive Brethren. The Exclusive Brethren are an ongoing embarrassment. [ 
Interruption 
] 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member is not allowed to accuse another member of that. The member will stand withdraw and apologise. 
Bob Clarkson 
: I really hesitate but I will apologise. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I will warn the member once that when a member is asked to withdraw and apologise that is all he or she says. The member will now stand withdraw and apologise. 
Bob Clarkson 
: I withdraw and apologise. 
Hon STEVE MAHAREY 
: The big embarrassment for the National Party is of course the Exclusive Brethren. Here is what the National Party has said. In an interview with Paul Holmes for example Dr Brash said he had no knowledge of the pamphlets. The following day he walked away from reporters. The following day he told reporters he had known about the pamphlets but had not read endorsed funded or distributed them. He admitted he had met with the group three times in 18 months but he also told us he had no idea when and how he met them. We are also told by people that he went as far as to make sure that those appointments were taken out of his diary so that no one could discover them. 
We come therefore to the last advert that is worth talking about today. It shows the new Don Brash—no more “Mr Mild Man”. Don says he is back and is taking no crap—he says it politely; he often says it politely—because he is now a man of guts. By the way this is not a national ad in the sense of being nationwide. It is being trialled only in Taupo. I do not know why—the people of Taupo obviously believe deeply in the man of principle. So National is running the ads up there to see whether people will fall for it. Well if the man of guts the man of principle is truly this why does he not come here today and tell us the truth about the Exclusive Brethren? Did he know about the pamphlets? Did he know about the money? Did he meet with these people? If the appointments with them have been taken out of his diary did he do so? He needs to clear that up today in order to be the man of guts and the man of principle. 
Hon MURRAY McCULLY (National—East Coast Bays) 
: 
 On 28 April 2005 the Auditor-General of New Zealand an officer of this Parliament signed two letters. He signed a letter to the Prime Minister of this country and a letter to the Leader of the Opposition. The Auditor-General—the watchdog of public finances—had been investigating for many months attempts by the Labour Party to spend taxpayers’ money in the form of advertising under the heading Working for Families that he knew would intrude into the election process. The Auditor-General signed those two letters on 28 April because he wanted to blow the whistle and inform the Prime Minister and the Leader of the Opposition of a way forward. The Auditor-General wrote to the Prime Minister that he considered it imperative before the election and before presenting the report to the House to seek some level of cross-party commitment to a reform process. 
The Leader of the Opposition received that letter and responded to the Auditor-General by saying that of course he would put a meeting time in his book and to come and talk to him. A few weeks later some very embarrassed officials from the Audit Office had to ring the office of the Leader of the Opposition to say that they did not need the meeting because the Prime Minister of New Zealand the great upholder of public values in this country refused to meet the Auditor-General. 
 The Prime Minister said: “No I will not meet the Auditor-General to discuss the report.” When one reads the report one can see why. The Auditor-General wanted to discuss this report with the Prime Minister. That report states: “It is a generally held principle that taxpayers do not pay for political parties’ publicity except for support of parties’ parliamentary activities or the conduct of ministerial business. This is broadly consistent with the accepted position in New Zealand that the State does not fund political parties.” That is the letter the Auditor-General wrote to the Prime Minister asking for a discussion. That is the reason the Prime Minister of this country told the Auditor-General to take a running jump. She told the Auditor-General that she refused to meet him. 
Members on this side had a pretty fair idea that she was going to be a bit embarrassed in the discussion anyway. We knew Labour had plans to spend $23 million of taxpayers’ money getting re-elected with the Working for Families publicity programme and other programmes of that type. But never never in our wildest dreams—or perhaps in our worst nightmares—did we believe that the Prime Minister even at that point when she received the letter from the Auditor-General had plans to spend half a million dollars of taxpayers’ money out of her leader’s budget which she was going to sign off and that was going to be unlawful expenditure within the meaning of the Public Finance Act. The Prime Minister of this country declined to meet the Auditor-General because she knew when she received the letter from him that she had already signed off on a plan to spend half a million bucks on the Labour Party illegal pledge card which is coming home to roost. 
The problem was it was all going swimmingly until of course Mr Henry came on the scene. Mr Henry signed off this letter on 2 September. He made it very clear to the Labour Party that firstly this was not an appropriate use of taxpayers’ money and secondly whatever the source of the money Labour had to declare it as an election expense under section 214B of the Electoral Act. Labour knew from that day as Mr Clarkson knew when he was told by the Auditor-General that his spending would be under scrutiny that it had to do something about it. Mr Clarkson faced with the same warning from the auditors said: “Oh no I won’t spend what I was planning to spend for the last few weeks of the campaign.” He obeyed the law. The Labour Party had the same warning from the same Auditor-General and what did it do? It went ahead and knowingly broke the law. Section 214B has a description for that conduct. It is called a corrupt practice. That is a corrupt practice as stated right there in section 214B. 
Hon PETE HODGSON (Minister of Health) 
: 
 There is considerable irony in following that member— 
Hon Dr Nick Smith 
: That’s a corrupt Minister. 
Hon PETE HODGSON 
: —that member in particular— 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member knows that he cannot call the Minister corrupt like that. He knows that that is not within— 
Hon Dr Nick Smith 
: I have just listened with great clearness to a speech from Mr McCully that makes it absolutely plain within the definition of the law that what the Government did was corrupt. I will not have you as a member who was elected on that corrupt practice tell me that I cannot say that in this Parliament. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member knows that he can never bring the Speaker into the debate. For that the member will stand withdraw and apologise. There is a clear Speaker’s ruling on the word “corruption”—of calling another member a corrupt member. The member will stand withdraw and apologise for those two— 
Hon Dr Nick Smith 
: I withdraw and apologise for bringing the Speaker into the debate but I stand by my statement that this is a corrupt Government in terms of the Electoral Act. 
Hon Trevor Mallard 
: I raise a point of order Madam Speaker. I do not think there is actually much that needs to be said. The member has been required to withdraw and apologise by you. He has declined and the procedures at this point I think require naming. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Just before I do that I have asked the member to withdraw and apologise. I will just ask the member to withdraw and apologise. 
Hon Dr Nick Smith 
: I have to you. 
The ASSISTANT SPEAKER (Ann Hartley) 
: No I asked the member to withdraw and apologise for calling the Minister a corrupt Minister. Please stand withdraw and apologise. 
Hon Dr Nick Smith 
: No I am not going to. The Government has been disgraced. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member now needs to leave the House. 
Hon Dr Nick Smith 
: I would rather leave than tell a lie. 
The Hon Dr Nick Smith withdrew from the Chamber. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I remind the member that he cannot make a comment like that when he leaves. He has been told to leave and he says nothing more. 
Hon Trevor Mallard 
: I raise a point of order Madam Speaker. Much as I do not want to comment on your last ruling I think it is one that sets a terrible precedent. It has been very clear in the past when members make that sort of comment that there has been additional punishment put on them. I have experienced that myself from Speakers from both sides and frankly I think it is a useful precedent and one that should be stuck to. If people can abuse the Chair as they leave and not receive further punishment then this House will fall even further into disrepute. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Well the member makes a perfectly valid point and certainly all members when they are asked to leave the House should leave without making any comment at all. I know that I certainly do not want to see this practice continue. If it does there will be action. 
Lindsay Tisch 
: I raise a point of order Madam Speaker. My colleague Dr Smith—and I am not challenging your ruling—is pretty upset with the actions of the Government. Throughout Dr Brash’s speech and other speeches in the House this afternoon we have heard the word “corruption” being used many many times. There were no points of order at that stage. The Speaker never interrupted the speeches at that stage when the word “corruption” was used. I do not know where in the  
Speakers’ Rulings 
 it is stated—and you may be able to point me in the right direction—that the word “corruption” cannot be used. I have not sought that ruling myself. 
Dr Smith has been ejected from the House for saying that this is a corrupt Government and that the people involved are corrupt but his remark was in line with the whole theme that has been running from Dr Brash’s speech when he led the debate for National at the start of the general debate. The word “corruption” has come up many times and I think it is appropriate that that word continue to be used as there were no interjections and no one brought points of order during the period when that word was used. As you have ejected Dr Smith from the House—and I am not challenging what you have done—that is punishment in itself and in our view no further action needs to be taken. 
The ASSISTANT SPEAKER (Ann Hartley) 
: That was not what happened. The member clearly called the Minister “a corrupt Minister” and he cannot do that. 
Hon Trevor Mallard 
: I raise a point of order Madam Speaker. I would like to strongly reject the submission the National Party whip has just made to you. The idea that Ministers or Governments can be described in that way has been outside the Speakers’ rulings ever since we have had a Parliament and just because apparently someone else did it earlier does not bring it within the Speakers’ rulings. You will remember of course that there was considerable noise from the National Party at the time Dr Brash was speaking. Many of us could not hear. We did not complain because we did not think we were missing much. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I have ruled on the point of order. There will be no further discussion. 
Hon Murray McCully 
: I raise a point of order Madam Speaker. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Is this a new point of order? Because I have dealt with this issue. 
Hon Murray McCully 
: Yes it is a new point of order. I understand the ruling that has been made and there is a series of Speakers’ rulings that deal with the matter. But I invite you to read section 214B(3) of the Electoral Act which creates a quite precise definition of a “corrupt practice”. A narrow legal term is used in section 214B(3) to describe certain activities. In fact it also describes it as an “illegal practice” the situation where a politician or a political party engages in the same sort of act but unknowingly. 
I want you to inspect that section of the Act and perhaps consider giving the House a considered ruling. Clearly there has to be a way of members being able to refer in the course of debate to that section and to the legal consequences of that section in a way that is inside the Standing Orders. I would like you to advise the House in light of your earlier ruling how we might be able to do so. 
Hon Trevor Mallard 
: I raise a point of order Madam Speaker. I think you will find that it could well be valuable to give that sort of considered ruling but I think many of us who have been here not too long would be able to right it relatively quickly. There are proper ways of bringing up matters such as that—as with a number of other criminal matters that members including members opposite have been accused of in the past—and it is not through comment in this Chamber. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member is quite right. We are dealing with the order of the House. 
Hon PETE HODGSON 
: It is a pleasure to rejoin the debate and to say it is an irony to follow the attempt made by the member who has just resumed his seat as he seeks to mount the pedestal of high moral ground by quoting the Auditor-General as saying—I wrote his quote down—words to the effect that taxpayers do not pay for a party’s political activities. Well let us look at some of the National Party’s political activities. I have a brief sample of the sort of thing that one can talk about in a 5-minute speech. 
We can begin at the time when Bill English was the leader of the National Party in 2003. He had billboards around the country paid for by the taxpayer complete with parliamentary crests that of course were political in nature. Is Bill English not a politician? So we have the National Party on its very big high horse and as Michael Cullen said during question time when one mounts that sort of saddle one had better make sure it will stay upright. Certainly this information I have here—what National stands for in pretty colours largely in blue—has a parliamentary crest on it and is therefore a piece of propaganda paid for by the taxpayer. 
But we can go further; we can go to my home town of Dunedin 3 weeks before the election. Here is a letter from Katherine Rich MP that states: “More money for superannuitants.” Does this letter suggest that Katherine Rich is seeking to reduce votes for National? I think not. Can we assume that this activity is therefore a party political activity? I think we can. The letter talks about the National Party it talks about a better deal it talks about guarantees it has Katherine Rich’s signature on it it has the National Party insignia on it and it has a parliamentary crest. This letter was paid for by the taxpayer. And on and on it goes. 
We have the sight of the unctuous Don Brash—the man who a year ago could not remember whether he had met with the Exclusive Brethren did not tell his deputy half the story and did not tell his finance spokesperson half the story. Then in the third week of the campaign in an extraordinary several days the media got information piece by piece from the reluctant and denying Dr Don Brash. He is the man who said to Paul Holmes: “I don’t know where the pamphlets came from.” but within days he did. Within days he had worked out that he had met the Exclusive Brethren once. Then he said he had met them more than once. Then he said he had met them several times. And then finally he confessed he knew the Exclusive Brethren were bankrolling his campaign. Even then the unctuous Dr Brash decided to take the meetings out of his diaries. He took them out. 
Dr Don Brash 
: It’s not true. 
Hon PETE HODGSON 
: It is true. He took them out of his diaries and now he is acting holier than thou. 
I say to the good Dr Brash that 10000 bucks will not cut it. Ten thousand bucks will not go near it. He should read carefully the Solicitor-General’s findings read carefully the Auditor-General’s findings look at himself in the mirror look at the size of a $10000 cheque and see whether he has got it to add up—because he has not done so now any more than he did with GST. He just has not got it to add up. The member declines to accept that much of the things he has paid back for are only a fraction of the totality of that party’s liability. The member continues to be in denial—just as he denied for days that he knew anything about the Exclusive Brethren. The member appears to be in denial. 
But I can have my most fun with a piece of advertising that was paid for by the National Party. This was paid for by raffling chooks or by going to the Exclusive Brethren or the insurance agents or whomever it goes to for its money. It was paid for by someone other than the taxpayer. 
Dr Don Brash 
: Stick to the truth. 
Hon PETE HODGSON 
: Don Brash has asked me to stick to the truth. Let me read from his own press statement: “You are the Reserve Bank Governor 2001. You can see the Government is making dumb choices that are slowly wrecking the country you love. You know that if you speak out about it you risk being sacked from the job that you love.” That is the spin. What are the facts? 
The facts are that that refers to a speech Don Brash gave at the Knowledge Wave conference. I was there; the speech was boring. Don Brash said in his speech that we needed to sell more things privatise more and get rid of the minimum wage—all of that stuff. He is agreeing with it even now. Even now the good Dr Brash is agreeing that that is the pathway for the country. 
JOHN KEY (National—Helensville) 
: 
 It is very interesting to watch a Labour Party that is in deep trouble and knows it. It is very interesting to see a Labour Party that has its back to the wall and knows it. It knows it for a couple of reasons. [ 
Interruption 
] Jill Pettis should not get stuck in the fish wire. Question time today was very interesting. We saw an example of Trevor Mallard with his head down and Michael Cullen with his head down. The Labour Party has a problem and it knows it. The problem is on two fronts actually and it is a very serious one. The problem for the Labour Party—as Mr Mallard knows—is showing up in its polling. 
Hon Trevor Mallard 
: No it’s not! 
JOHN KEY 
: Oh yes it is and Mr Mallard knows it. I have seen it and Mr Mallard knows it. The Labour Party’s problem is a Prime Minister who is about all the party has to hold it together. She is the only glue. She came into Parliament promising high standards. Now she is “Hele Baba and the 40 thieves”. She has Taito Phillip Field who she knows and the journalists the public and the Labour Party supporters know is guilty. Labour members know he is guilty but they cannot have an investigation because if they do the party will lose its one-seat majority. So Labour does not know what to do about that; it is just going to park that issue. 
The next thing the Labour Party knows is that it has spent $900000 of taxpayers’ money to buy an election and it did it for one reason. A week before the election on 17 September Labour held a meeting to discuss its internal polls. Pete Hodgson had to tell Labour Party members the bad news—that Labour was four points behind and was not going to win. 
Hon Trevor Mallard 
: No. 
JOHN KEY 
: Oh yes he did. The thing that members have to understand about the Labour Party is that Helen Clark is a political junkie and she runs Labour’s campaigns. She does not just sit around as Prime Minister; she runs Labour’s campaigns. She signs off on every ad. She told Labour members: “We are not going to lose because we are four points behind with a week to go. We will do whatever it takes.” On 14 September Mike Smith the Labour Party secretary did not know that the Labour Party was going to do whatever it takes to win so he wrote to the Chief Electoral Officer and said: “Yes we’ll be including the Labour Party pledge card in our campaign spending. They are always having it paid for by the taxpayers.” That is Labour’s second issue—its cap. 
After the election he wrote to say he was rescinding that statement. Why? Because he knew that the Labour Party had to spend the money and if it did not then it would not have won the election. So now they have a problem. They have been exposed their backs are to the wall they are not happy and they owe $900000. This is their simple problem—No. 1 they are broke. They do not have any money. They spent absolutely every dollar they could on buying that election—and every dollar the taxpayer had on buying the election as well. So the No. 1 problem is that they are broke. 
Problem No. 2 is that they cannot raise the money. They have been to Owen Glenn and he said that he would not give them any more money. And they do not have any friends in the business community so they cannot raise the money. So they have option three. Option three is that they borrow the money. There is one reason why they will not borrow the money—and Trevor Mallard knows it well. If a Labour Government borrows $900000 at its third term it will be kicked for touch at the next election. Those members will not even be able to raise the $900000 to pay back what they borrowed for the last election let alone for the next one they want to go into. So those members have turned ugly and this issue is now a diversion. 
According to the Prime Minister it does not matter. It is not inside the “beltway”. Well that is pretty interesting because that is not what the  
Dominion Post  
said this morning when it went out and asked a few people. Pip Wylie a cafe owner in Taupo stated: “The prime minister is wrong when she says the rest of New Zealand is not interested in [this issue] …”. Anne Spence a 23-year-old nurse in Greymouth stated: “We are interested. It is our money as well. As the prime minister she is supposed to care about all of us …”—I do not think so I say to Anne. The bad news is that the Prime Minister cares only about herself—Helen—and the 40 thieves whom she looks after. Jean Turnbull is 81 but she is not slow. She may be retired and living in Rangiora but she stated: “The allegations of corruption and the use of taxpayer funds on Labour’s election pledge card concern me especially [because it is our money] …”. Bernard Carroll a taxi driver from Wellington stated: “It’s taxpayers’ money and they should be accountable for every penny that they spend. I think [it is] a matter of principle …”. But best of all the award goes to Kelvin Ward. He is 74 retired and living in Stoke Nelson—a good constituent no doubt of Nick Smith—and he stated: “Yes she’s probably right in assuming people don’t care—but I don’t really care what she says anyway.” 
MOANA MACKEY (Labour) 
: 
 I have to say that John Key is not looking a well man. John Key was quite a healthy smiley-looking man in his first term of Parliament. He looks like a man with the weight of the world on his shoulders now. Body language speaks a thousand words and members on this side of the House noticed the body language. We know that the National Party had a very long and difficult caucus yesterday. Some of its members told some of our members that. But I would say that the body language yesterday was amazing. John Key sat there like a man isolated with the weight of the world on his shoulders and I suspect that very soon he will have the weight of the National Party on his shoulders. 
We are still to hear from National members as to why they did not tell the people of New Zealand about $1.2 million worth of funding from the radical Exclusive Brethren religious sect in the last campaign. 
Dr Don Brash 
: No no—tell the truth. 
MOANA MACKEY 
: Dr Brash says I should tell the truth. Maybe he could tell the people of New Zealand why he told the press that he had not met with members of the Exclusive Brethren that he did not know about the pamphlet and that he had no idea what was coming—only to have to backtrack days later when he was outed as having lied to the media about his meeting with the Exclusive Brethren and knowing about the pamphlet. 
Hon Trevor Mallard 
: I raise a point of order Madam Speaker. Although no member of the National Party will defend the Leader of the Opposition I will. One cannot accuse a member of lying in this House. I think it is important for the standards of the House. Even if the National Party is not prepared to defend Don Brash from that accusation I ask that the member withdraw. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member will stand withdraw and apologise. 
MOANA MACKEY 
: I withdraw and apologise. 
The National Party weekly tried to draw comparisons with the union movement and its support for the Labour Party at the last election campaign but there were some very key differences. Firstly we included their spending in our electoral return; the National Party did not include the spending of the Exclusive Brethren in its electoral return. Secondly the union movement did not put fake addresses where no one lived as the address of the reference person on its material and it was quite clear to all New Zealanders who was producing the union movement’s material. The material from the Exclusive Brethren attacking the Greens and the Labour Party was very very similar to the material that attacked the Greens in Australia. 
Dr Brash is trying to paint himself as a man of principle and a man of guts. So why does he not have the guts to tell us about the overspending on GST? Here is the man who said that he simply forgot to pay GST. Given that he was the man who designed GST that is a little difficult to accept. Why does he not have the guts to tell us about his close relationship with the Business Roundtable? Why does he not have the guts to tell us the truth about the Exclusive Brethren? Dr Brash claims to represent mainstream New Zealanders and he wants to keep out immigrants who do not share mainstream New Zealanders’ values. Well I say to Dr Brash that he should have the guts to tell us which cultures he is talking about that do not share the mainstream values of New Zealanders and should be excluded from coming into New Zealand. 
This is the man who did not have the guts to say to Maori inside the wananga what he said about them outside the wananga in the car-park. He is a man who did not have the guts to leave the appointments with the Exclusive Brethren in his diary—and he is yet to explain that—and a man who did not have the guts to tell New Zealanders about his agenda of radical right-wing privatisation. He is on record as saying that he will not water down his principles to sate New Zealanders. Then why does he not tell New Zealanders that he does not care who owns our schools and he does not care who owns our businesses? He will not tell them because he cannot sell it. 
On  
Agenda 
 2 weeks ago Don Brash was asked whether John Key was one of those who overspent at the last election and he refused to confirm or deny that. I wonder whether Dr Brash is willing to clarify that in the House today. 
This is a man who promised United States politicians that the nuclear-free policy would be gone by lunchtime but he did not have the guts to tell New Zealanders that that is what he would be doing. 
Lindsay Tisch 
: I raise a point of order Madam Speaker. This member has been referring to Dr Brash throughout her speech and saying that Dr Brash does not have the “guts” to do A B C or D. That is unparliamentary language and I ask that she withdraw and apologise for using that word. 
Hon Trevor Mallard 
: Although generally today I have been working hard to have decorum in the House unfortunately for the member Don Brash and the National Party have put an advertisement in the newspaper suggesting that he does have “guts”. Therefore I think it is very hard for them to say that that point cannot be argued in the House. Those members are the ones who have put his courage his conviction and his ability to say things consistently into the public arena. To say that they are now too scared to have that point debated in the House just defies belief. 
The ASSISTANT SPEAKER (Ann Hartley) 
: That is a debating matter but the point is that it is a robust debate. I think many words have been used this afternoon that are in that realm so I would ask the member to continue. 
Lindsay Tisch 
: I raise a point of order Madam Speaker. We were told before that we could not use the word “corrupt”. Now we have a member who is constantly using the word “guts” referring to Dr Brash as not having “guts” and using that sort of language. If the word “corrupt” has been ruled out then the word the member is using should also be ruled out. Madam Assistant Speaker I ask for some consistency in your rulings on this matter. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I did not realise that the member was going to speak to that point again. I thought he had another point of order. I have ruled on the point of order. I will not go over my previous ruling but it is in  
Speakers’ Rulings 
. As I said before many words have been used this afternoon that come into the realm of robust debate and that is certainly one of them that I am ruling does come into robust debate. There will be no further points of order on that matter. 
MOANA MACKEY 
: At the end of my speech I will seek leave to table the advertisement with the picture of Don Brash and the word in dispute written very large underneath it which says “Guts”. 
Don Brash is a man who did not have the guts to tell the people of New Zealand whether he would send troops to Iraq. When asked he said: “I would have done what President Bush did.” I have to say I wish he was a man who had the “guts” to put some policy out at some point—during the general election campaign might have been a good time—so that we could have debated it. It still astounds me that a major party in an election campaign could get away with not having a health policy. I say: Dr Brash a man of “guts and principle”—yeah right! 
I seek leave to table the National Party advertisement with the word “Guts” written very largely and a picture of Dr Don Brash. 
Documents by leave laid on the Table of the House. 
JUDY TURNER (Deputy Leader—United Future) 
: 
 When a Government agency has wide-ranging statutory powers that can be applied in situations requiring less evidence than would be necessary to secure a conviction in a court of law it is absolutely essential that that agency is required to be fully transparent about the actions it takes. Child Youth and Family is our legally empowered child protection agency that is able to remove children from their parents’ legal care and place them in the care of others when it believes it is in the children’s best interests. 
In the last few weeks United Future has been calling on this Government to ensure that child protection in this country occurs in an environment that reflects international standards of best practice. We are asking the Government to set up an independent Child Youth and Family complaints authority that is similar to the independent Police Complaints Authority. Our intention is not to create a culture of shame and blame within Child Youth and Family; in fact it is quite the opposite. Part of any credible social work environment must include the opportunity for quality assurance activities to take place. 
No one envies the front-line caseworkers at Child Youth and Family. They deal with what must be some of the most stressful casework and they have to make some very tough calls in the interests of children’s safety and well-being. The nature of Child Youth and Family interventions is that removing a child is only the first in a series of steps that often include family group conferences which decide access arrangements and placement decisions. There are court appearances psychological assessments and the like—all with huge implications for the child his or her parents siblings extended family foster parents and Child Youth and Family staff themselves. Everybody has a lot invested in the outcome. 
Currently the Children’s Commissioner has the legislative mandate to investigate the decisions and actions of Child Youth and Family as they pertain to the ongoing safety and well-being of any child or children. This is important work and the department could well do with some additional resources to meet this obligation. However the Children’s Commissioner does not investigate on behalf of or in the interests of adults affected by the decisions and the actions of Child Youth and Family. In fact parents grandparents those adults who are making a notification and any other adult involved have nowhere to go if they want to complain about the way they have been treated. 
To give some perspective the Police Complaints Authority costs about $2 million a year has seven staff and handles about 2500 complaints a year of which about 13 percent are upheld either fully or partially. That represents an average of 343 cases. The rest of them either do not hold up under scrutiny are dropped or are settled through mediation processes. 
Like most MPs I have a huge pile of letters emails and documents sent to me by both family members who believe they have been unfairly treated by Child Youth and Family and those who have made notifications to the service and have been unhappy with the response they received. I am not convinced that every case in my filing cabinet would stand up to independent examination. The fact that possibly 13 percent of cases could represent a genuine complaint is a cause for concern and that those people have no way of having their concerns looked at in a timely way is completely unacceptable. Recent questions to the Minister in charge of Child Youth and Family show that the Ministry of Social Development currently does not even keep a database of complaints. It does not even know or record how many complaints have been received by the department. 
Some of the families who have contacted me are afraid to complain in case they make their case management situation worse. Those fears may be irrational but with no data kept and nowhere else for them to turn for help it is difficult for me as a member of this House to offer those people any reassurance. 
It is essential that public confidence in our child protection services is high. I think we could do better and having an independent body would be a great place to start. I invite the Minister who is responsible for Child Youth and Family and her staff members—who indicated when I questioned them at the financial review of the service that they were aware they could be doing better in that regard—to make haste in making some very important decisions. If we take the information around the Police Complaints Authority as an example we will realise that it is not a costly exercise. 
GEORGINA BEYER (Labour) 
: 
 In October 2004 the Human Rights (Gender Identity) Amendment Bill was introduced to the House—a member’s bill in my name. I can inform the House that as of this morning I discharged that bill and have withdrawn it. I have done so being very confident in the progress made towards addressing the issues that that bill raised and brought forward for consideration. They were to include gender identity within our human rights legislation to put beyond doubt that there were no grounds for discrimination and indeed to prohibit discrimination against those with issues around gender identity. That group would have included transsexuals transvestites cross-dressers intersex people and any others who felt they had a gender identity issue. 
I am pleased to report that upon his own initiative on behalf of the Government the Attorney-General the Hon Dr Michael Cullen with support from the Prime Minister sought a clarification from the Solicitor-General. He has today provided me with a Crown Law opinion that concludes that the current New Zealand Human Rights Act and particularly section 21 of that Act would be inclusive of people who may have issues around gender identity particularly the specific groups I mentioned before. They would be protected under the proviso that there cannot be discrimination on the grounds of sex or sexual orientation. This clarity will put to rest that issue for some including the decision makers in our courts etc. who may—and we have not had case law to date on this in New Zealand—have to consider a matter around gender identity. This opinion would give an indication and a direction on which they may base a judgment. 
Discrimination still exists for transsexuals and other such people with gender identity issues in New Zealand. That was the purpose of having clarity brought about by the introduction of my bill. For example those issues exist within housing and employment situations and I can certainly attest as a member of Parliament to having received delegations of people who have pointed out that young children who are transsexuals have encountered an awful lot of problems within their schools and within their communities because of the way they have chosen to live their lives. That is discrimination and it is intolerable in this day and age. 
I am glad this clarity has been brought to the attention of Parliament and of those in New Zealand who are interested in the subject matter. This effort has not been without work from numerous people particularly organisations outside of Parliament. I can think of an organisation called Agender that deserves some credit and of other transgender organisations that have watched keenly the progress of the bill for clarity around the situation. I would like particularly to thank Michael Wilson who assisted in drafting the original bill. 
I would also like to thank colleagues within the Labour caucus and many other members in the House who in the last Parliament and in this current Parliament expressed some support for the intention of my bill. But there was not enough support within the last Parliament or this Parliament for me to feel confident that the bill would have succeeded had it gone to a first reading; indeed I think quite the contrary would have occurred. I guess quite venal debate might have occurred like that after the prostitution reform and civil union legislation was passed. The debates that interested this House and the nation at that time brought up some rather distasteful references to things we had long left in the past. 
I just add also that internationally—I have just returned from a conference in Montreal and the United Nations Human Rights Commissioner pointed out in her keynote address to that high-level conference that gender identity is a vexed issue that still needs to be addressed by many jurisdictions around the world—those matters are being addressed by other jurisdictions. 
 It is pleasing to find within our own human rights legislation that this Crown Law opinion will I hope put beyond doubt any question in respect of the matter of gender identity protection for the transgender community and specifically transsexuals transvestites cross-dressers and the intersex people. The whole transgender community can feel that clarity has now been gained and that there is something that they can rest on as far as protection is concerned. 
I seek the leave of the House to table for members’ information a Crown Law opinion dated 2 August from the Solicitor-General which concludes that transgender people are protected under the existing human rights legislation of New Zealand. 
Document by leave laid on the Table of the House. 
Hon MAURICE WILLIAMSON (National—Pakuranga) 
: 
 I raise a point of order Mr Speaker. I would ask you to give this issue a considered ruling at some time later. It is to do with a matter that arises in the House from time to time—in my 20 years I have heard it raised a lot—when a member tries to accuse another member of this House of lacking courage. I have heard you on a number of occasions pull up members—and I have heard other presiding officers do so as well—and say that a member cannot question whether another member is lacking in courage or say he or she has no courage and so on. I know that people who have called someone “spineless” “yellow” or any of the other words like that have been pulled up immediately by successive presiding officers. 
However when I look first of all at the Standing Orders and then at  
Speakers’ Rulings 
 I find it very difficult to find a specific Speaker’s ruling that refers to this. A number of rulings refer to whether someone is being influenced by something outside the House by way of financial or other pressures that may be on him or her. In order that we may get some clarity and maybe even a Speaker’s ruling in the book I would like you Mr Assistant Speaker to give this House a ruling as to whether a member can question when he or she is in a debate a member’s courage. 
We have heard Moana Mackey today say the Leader of the Opposition “does not have the guts”. I think that remark stands alongside “yellow” “spineless” or the “jellyfish” word and alongside all of those other words that have been ruled out from time to time. I seek a ruling from you Mr Assistant Speaker even if you do not give it to us now but take some time over it. If it is wrong for members in this House—and I think it has been wrong all along—to question whether a member lacks courage or has courage then it is right that you give us a ruling that what Moana Mackey said today about the Leader of the Opposition was also outside the Standing Orders and that she should be made to withdraw and apologise. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: I thank the honourable member for his contribution. I say to him that Standing Order 116 concerns personal reflections. If any indication is given as to courage then that of course is a matter that could well come within Standing Order 116 because to imply that a member lacks courage is a personal reflection and out of order. Having heard what the member said and the ruling that was given before I will certainly ensure that it is given further consideration. 
CHRISTOPHER FINLAYSON (National) 
: 
 We say that the rule of law is fundamental to the operation of our society. Just a few days ago I heard Justice Anthony Kennedy of the United States Supreme Court talk about the rule of law. He said that one of the key aspects of the rule of law is that “The Law is superior to and thus binds the government and all its officials.” Yet in New Zealand at this time we are seeing that this Government is proposing retrospective legislation to validate misuse of funds—one law for the Government and another law for the general public. 
The non-lawyer Dr Cullen tries to distinguish between retrospective and validating legislation. But that kind of Jesuitical distinction fools no one. Last year the Auditor-General warned political parties to be careful with their spending on the campaign. Labour ignored his warning misused public funds and now retrospectively seeks to validate its unethical behaviour. What has Labour’s response been to the Auditor-General’s review? This afternoon it has been threefold. 
The first response was to try to say that if there had been a problem with unlawful expenditure last year it might have existed for as long as 15 years. However Mr Brady’s comments about his warnings explode that feeble defence. He warned MPs to watch their election spending and Labour MPs ignored his warning. 
The second approach and it was exemplified this afternoon is for Labour to step up its persecution of a religious minority. A few days ago at Te Papa the Prime Minister and Mr Maharey gave nauseating Uriah Heep speeches about religious inclusiveness. But religious inclusiveness and tolerance are always on Labour’s terms. The Prime Minister wants tolerance for Muslims but that does not extend to Christianity for which she has apparent contempt. The Labour mantra about the Exclusive Brethren is a pathetic diversion. The only weird cult around here is the Labour Party caucus. 
The third defence exemplified by that mediocre speech from Moana Mackey is what is called the “tu quoque” defence—“you too”. Labour was wrong as usual on these two points. Moana Mackey talked about the quality and accuracy of the National return. But the Labour return did not refer to the donations of its trade union friends. She also tried to make something of the GST issue affecting the National Party. Yet even if the GST is added in National was still within its limits. 
When it suits Labour it is the very model of constitutional propriety. So for example the member for Auckland Central Judith Tizard said in her second reading speech on the Patents Amendment Bill on 25 June 1992 that she had a horror of retrospective legislation. On 6 December Ms Pettis said in relation to another Act that retrospective legislation was unfair. Perhaps best of all came from Mr Peters whom I certainly hope has recovered from the infection caused by his self-inflicted love bites. On 15 December 1994 he said that retrospective legislation was repugnant and should be so in any Parliament. They were complaining about retrospective legislation to make minor amendments to tidy up errors—nothing like what is being contemplated today. 
In Government Labour is quite different. Only a few years ago the MP for New Plymouth Harry Duynhoven needed fast-track retrospective legislation to let him keep his seat. Labour said this was a trifling matter but no one can say that the pledge card expenditure is trifling. It was misappropriation of public funds in contravention of very clear rules about how those funds should be spent. Labour’s intention to introduce retrospective legislation in these circumstances is morally and legally wrong and an affront to the rule of law. I come back to what Justice Anthony Kennedy said and that is that “The Law is superior to and thus binds the government and all its officials.” The third-rate apparatchiks on the other side of the House obviously disagree. Their actions undermine the rule of law in this country. If I may I will borrow Ernest Bevin’s famous quote about his opponents: they really are lower than vermin. 
Finally let me say something about that paragon of virtue Mr Dunne. His superior manner and pretentious contributions bring to mind the phrase: “There but for the grace of God goes God.” In fact there is no truth in the rumour that Mr Dunne wants to be pope because being God’s vicar on earth would not be good enough for him. 
R DOUG WOOLERTON (NZ First) 
: 
 New Zealand First has received a number of emails and letters in recent weeks in a campaign to influence its voting. We have been quite saddened by the language used in emails and letters during this campaign which appears to us to be threatening and that recalls the language used to remember those who died serving their country during wartime: “We will remember them.” We think this is in bad taste. However we want to quietly and respectfully remind Grey Power and these campaigners that they should remember a few things as they embark on this operation. 
The first thing they should remember is that New Zealand First fought the Shipley Government tooth and nail when it tried to cut superannuation. Let them remember that New Zealand First introduced the compulsory superannuation debate provided an extra $252 million for elective surgery funded 32000 more operations and provided free influenza vaccinations for the elderly. Let them remember that New Zealand First budgeted for the removal of income and asset testing for elderly care. This was so distasteful to the Shipley Government that it overturned it when we got out of the coalition. 
Let them remember that New Zealand First removed the superannuation surtax after superannuitants were betrayed by both Labour and National on this issue. 
Hon Brian Donnelly 
: That’s a big one. 
R DOUG WOOLERTON 
: My colleague says it was a big one and it was. Let them remember that New Zealand First has worked for them by increasing the minimum rate of superannuation up to 66 percent of the net average wage. Let them remember that New Zealand First has gained a significant increase in funding for elder care in this year’s Budget. Let them remember that the golden age card which New Zealand First promised during the last election campaign will become a reality by late 2007 and will provide a range of private sector entitlements and commercial discounts. 
Let them remember that New Zealand First has listened to the concerns of the elderly regarding law and order and has delivered policies to address those concerns—notably 1000 extra police on the beat by 2008. Let them remember that New Zealand First shares their concerns about social policy and strategic asset sales and has put the brakes on those issues. Let them remember that New Zealand First is working for them and will never forget them. And today we have instituted an independent public inquiry into local government rates. That will do a darn sight more with due respect for rates in this country than Rodney Hide’s proposed bill. 
In closing I suggest to Grey Power that if all its members who threatened to withdraw their votes from us had voted for us at the last election we would have substantially more than seven MPs in Parliament. I tell Grey Power that New Zealand First has taken this time in a general debate to remind it about those things and that at least Grey Power still has one party in Parliament that is on its side and it should not take that fact lightly. 
The debate having concluded the motion lapsed. 
Westpac New Zealand Bill 
Second Reading 
Hon MARIAN HOBBS (Labour—Wellington Central) 
: 
 I move  
That the Westpac New Zealand Bill be now read a second time 
. This private bill promoted by the Westpac Banking Corporation provides the mechanism to enable Westpac Banking Corporation’s retail business in New Zealand to be vested in a New Zealand incorporated subsidiary—Westpac New Zealand Ltd. Westpac Banking Corporation has operated in New Zealand since 1861 and currently operates in New Zealand as a branch of the Australian parent. The establishment of a subsidiary enables Westpac to comply with the Reserve Bank of New Zealand’s local incorporation policy introduced in 2003. That policy provides that foreign-owned banks over a certain size are required to establish a New Zealand subsidiary with its own board of directors members of which are required to comply with New Zealand company law. 
I wish to offer particular thanks to members of the Finance and Expenditure Committee who ensured the timely return of this legislation to the House. Their work on this bill has gone a long way to help Westpac New Zealand Ltd meet its intention to allow the transfer of its assets and liabilities on 1 November 2006. 
When I moved the first reading of this bill I noted that Westpac and the Reserve Bank negotiated for some time over whether it would be necessary for Westpac to establish a subsidiary or whether there was another suitable solution. Ultimately the Reserve Bank was not satisfied that another suitable solution could be found so this bill creates a legal framework for the vesting of assets of Westpac Banking Corporation’s New Zealand retail business into a New Zealand company Westpac New Zealand Ltd. The select committee was advised that the Reserve Bank Treasury and the Inland Revenue Department agree that legislating is the best way of transferring the relevant parts of Westpac New Zealand’s business to the new entity. The committee has also been assured that Westpac New Zealand Ltd’s application to be registered as a bank will be assessed against the Reserve Bank’s standard requirements and that registration will need to occur before the transfer of assets and liabilities facilitated by the bill takes place. 
It has needed a very tight and intricate time frame to get all the actions within the correct time sequence but the public should take comfort that the change in corporate form of the New Zealand branch of Westpac will have no adverse effect on Westpac’s customers employees and suppliers of services or its ability to meet its obligations to Government entities. Four technical amendments were proposed; those have been accepted by the committee and are laid out in the bill. 
Once again I offer my thanks to the committee for its thorough examination of this bill and for the timeliness of it. I ask the House to move this bill through the remaining stages as expeditiously as possible in order to meet Westpac’s finely balanced time line. 
CRAIG FOSS (National—Tukituki) 
: 
 The National Party continues to support the Westpac New Zealand Bill through the House. This private bill allows the incorporation of Westpac New Zealand Ltd from the old Westpac Banking Corporation. First of all I thank all the officials who have been involved with the formulation of the bill. I know they have spent many many hours on the bill. I also thank the honourable member Marian Hobbs for bringing the bill to the House and helping us get it through the Finance and Expenditure Committee. I also thank our committee members for their well-considered examination of the bill and for the time they spent on it and the questions they asked of officials. 
When we look at the environment in which the bill is being presented we see that the Reserve Bank of New Zealand Westpac and various other Government agencies all operated with good intent and good faith. Their focus was on a good and fair outcome at the very least for the depositors in Westpac in its current form in New Zealand and in a greater sense the taxpayers of New Zealand who if anything untoward were to happen to Westpac would no doubt be called to help out. 
It cannot go without note that this financial transaction is probably the largest-ever in New Zealand’s history. It is quite possibly the largest transaction affecting more New Zealanders than any other I can think of. About 1.3 million customers of the existing Westpac will be impacted by this change-over. To be fair—and in Westpac’s words I think—the transaction will be almost invisible to those 1.3 million customers. But we need perhaps to consider the information and the awareness that those New Zealanders have of the institution into which they are putting their funds. I think the size of the balance sheet is about $30 billion to $40 billion. That is New Zealand’s largest-ever transaction. Although this is largely an administration bill I am sure some members are noting that the transaction is huge and on 1 November 2006 let us say $35 billion of New Zealand’s assets—deposits mortgages liabilities etc.—will be transferred at the stroke of a pen. That is a quite phenomenal amount and it still surprises me somewhat the lack of media interest and public interest in the bill. Having said that I am aware that some members have tried to raise this issue and perhaps we will hear more from them later. 
Overall the Westpac New Zealand Bill is a win to the Reserve Bank of New Zealand to the depositors in Westpac and to the New Zealand taxpayers. It is a small win perhaps because most of the other Australian-owned banks are already of this form. I guess wins for New Zealand institutions—governmental institutions in particular as they contest and even argue and fight regulatory arrangements with our Australian cousins—are few and far between. We have had another one today with the announcement that New Zealand stone fruit will be allowed into Australia but a cynic may argue that stone fruit was traded for importation to New Zealand of Australian honey. Of course being a patriotic Hawke’s Bay member of Parliament I note that New Zealand apples are still not yet going into Australia. 
The Reserve Bank has spent an awful lot of time and resources on formulating this bill and getting it through the various hoops and perhaps that is why the bank may have taken its eye off some other matters. I will come back to that in a moment. Why is this bill necessary? Bank failure in Australia or some systemic failure over there could have—will have—a resounding impact on New Zealand. That is not healthy for New Zealand. But I think we have to note that regardless of what this bill does—and yes it securitises New Zealanders’ assets within New Zealand—quite frankly if there were to be a large bank failure in Australia then the financial system of New Zealand would also probably be in a pretty poor state. I again argue that the risk of an Australian problem no longer having an impact on New Zealand does not hold much water in a practical sense. I certainly hope that will never happen or need to be tested. 
I note that the select committee had constant solid assurances from officials of Westpac in its various forms that there would be no restructuring that there had been no arbitrage possibilities and that there has been no exploitation of New Zealand tax law regulatory law Reserve Bank prudential requirements etc.; they were simply agreeing to do the right thing in the eyes of the Reserve Bank. I am sure they will hold to those words. The Reserve Bank also assured us that the prudential requirements of the new balance sheet of the new entity—Westpac New Zealand Limited—has and will pass all its prudential requirements asset ratios capital asset ratios etc. Again at first cut that looks good and solid for New Zealand. We are also assured that Inland Revenue Department officials were quite comfortable and were convinced that this was a tax-neutral transaction and that there were no fiscal risks surrounding the transaction. Again the outcome was in fact the best outcome that could be envisaged for New Zealand. 
Concern was expressed over the line in the sand of 1 November 2006. Officials came back to the committee and gave various assurances that that date was not quite as risky as I had earlier thought particularly when I first read the bill. But I still reserve an opinion there because in this current form we do not know where banks bank officers their servers their back office and so on—all contributing and helping to make this happen on 1 November—will be based. They could be in Melbourne in Sydney or in New Delhi—we do not know. New Zealand law of course cannot extend that far but I always look for any risk and try to manage it out of the transaction. I certainly hope nothing untoward happens on 1 November so all speed to everyone involved. 
I noted earlier that the Reserve Bank has spent a lot of time resource staff-number hours and outside consultation on this bill. Perhaps that is why the eyes of bank officials might have gone off the inflationary ball. The economy is under threat. The historic consumer price index is now running at 4 percent. The consumer price index is projected to stay at 4 percent or higher for the next 18 months. 
The Reserve Bank certainly needs to pay somewhat more attention to what is happening in our economy as a result of the actions of the Minister of Finance. In the current environment growth is running at only 1 percent. State sector wages are absolutely exploding at the cost of private sector wages. No one will see any productivity gain for New Zealand in that and productivity gains are the only way out of the current demise of the New Zealand economy. The Reserve Bank has not adjusted monetary policy to counter the actions of a flippant Minister of Finance—the over-taxation the inflationary spend-up the waste and the unproductive use of taxpayers’ funds. A prime example is the pledge card we have been hearing so much about today. 
Finally National welcomes this bill and supports its passage through the House. I am concerned though about the new Westpac New Zealand’s ability to retain its staff given the higher incomes available in Australia and the proposed capital gains tax and the effects that will have on their remuneration. I certainly hope the new officials do not join the 640-odd other New Zealanders going to Australia every week and apply for jobs at Westpac New Zealand’s head office in Australia. 
RODNEY HIDE (Leader—ACT) 
: 
 It will not be me who refers to the fact that the Westpac New Zealand Bill is a private bill. It is not common in our Parliament that an MP brings such a bill to the House. I observe that this bill is a big bill in terms of its implications. I will not point out that the member whose name is on the bill is not even here. I will not do that not at all not once. I should also point out that the ACT party will be sadly and unfortunately opposing this bill and I will set out why. 
I was interested to hear my colleague Mr Craig Foss speak on this bill and raise some concerns and then say he will vote for it anyway because the Reserve Bank and Westpac have given him assurances that everything is OK. The difficulty with that is that the Reserve Bank does not guarantee any bank in New Zealand and the Government does not guarantee any bank in New Zealand; people are out there on their own as customers. I must say that when I see a bill with Marian Hobbs’ name on it experience has taught me to look most carefully at what is going on. There is a reason she is no longer a Minister and is able to bring forward a private bill—it is because she was not very good at it. So Marian Hobbs who—and I do not think this is unparliamentary given what has gone on here today—has been referred to in the media as “Boo Boo” because of her constant screw-ups while a Minister now has a bill that affects 1.3 million customers and involves a transaction of $35 billion to $40 billion. Would one put that bill in the charge of someone whose nickname became “Boo Boo” who never rose above Minister of Broadcasting and who got fired from that job? 
National members are quite happy to vote for the bill because they have had an assurance from the Reserve Bank that everything will be OK. Let us examine this. When people go and put money into a bank it is no longer their money. All they have is a credit against that bank. If that bank falls over which would be a terrible thing they lose their money and the Government ain’t going to bail them out the Reserve Bank ain’t going to bail them out and Marian Hobbs is not going to reach into her back pocket and bail them out. No they lose their money. I am amazed that this House is going along so casually with this. So let us just think what happens. Right now if you are a Westpac customer you have a claim against Westpac which is a large bank across Australia and New Zealand. You know through the disclosure regime the assets and liabilities of that bank and you know it is a large bank. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: The member keeps on bringing in the Speaker. 
RODNEY HIDE 
: Why? 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: You know that you cannot bring the Speaker into the debate. Please continue. 
RODNEY HIDE 
: I would not do that Mr Assistant Speaker but I can talk about customers—and that is what I am talking about Mr Assistant Speaker. I know that you do not bank with Westpac but I can talk about a person going and putting his or her money into the bank. Right now customers have a claim against Westpac including its operations in Australia and New Zealand. But when this bill comes into effect on 1 November suddenly their claim will be against another legal entity. Is that not true Mr Foss? It is now a much smaller entity is it not—it no longer represents the bank in Australia and New Zealand; it represents the bank in New Zealand. So what customers are banking with has changed. The legal entity has fundamentally changed. Customers did not agree to that; Parliament is doing it. 
Craig Foss 
: Yes but they’re ranked higher. 
RODNEY HIDE 
: Oh well Mr Foss says they are ranked higher. He actually does not know that because the next kicker is that that has been done before in the 1970s. Of course Parliament then when it drafted the bill included in the bill the assets and liabilities that were being transferred across. What do we discover in this bill? There is no description of the assets and liabilities that will be in Westpac New Zealand. I defy anyone to tell me what the assets and liabilities of Westpac New Zealand will be. So that is interesting—we are setting up this legislation but who will decide that? 
Chris Tremain 
: The Reserve Bank. 
RODNEY HIDE 
: Oh well that is a worry—Mr Tremain yells out that he thinks it will be the Reserve Bank. I tell him that no it is not; it will be the Minister by Order in Council. Is that not correct? 
Shane Jones 
: Yes. 
RODNEY HIDE 
: Shane Jones is on to it; at least he kept awake during the hearings. So now we will have Michael Cullen that economic wizard—it goes from Marian Hobbs who is the author of this legislation to Michael Cullen—and we all know to trust him do we not? Here is the National Party now saying; “Don’t worry you 1.3 million customers; you can trust Michael Cullen.”—Yeah right! So for those 1.3 million people by Order in Council—Mr Jones has confirmed that; a very good chairman he has become I might add and that will sink his career—Michael Cullen will decide what the assets and liabilities of Westpac New Zealand are. Well bloody hell as they say! So people go to bed one night with their money in Westpac but they wake up next day and because of what we are passing here today in part it is a new legal entity. The assets and liabilities of that entity have been decided by the Minister of Finance Michael Cullen with no parliamentary scrutiny or check. 
It might have escaped members’ attention but there is a dispute on between the New Zealand Government and Westpac over a small tax bill totalling $750 million not including penalties. If we put the penalties in the sum goes to a billion dollars. The question has to be asked: “Oh I wonder who’s going to end up carrying that?” The Reserve Bank advised us not to worry; it would not be Westpac New Zealand. If we ask why not the bank says that it would never advise the Minister to sign that. That is how shonky this is. And I say to the House that if we are to agree to something that Marian Hobbs having been fired as a Minister because she was a booboo has come up with; if we let her come along here with a private bill for which she cannot even sit in Parliament and listen to the debate on; if we are just to rubber stamp the bill for 1.3 million people—the bill that involves a transaction forced by compulsion by this Parliament with no customers agreeing to this they do not have a say—if we are going to be doing all that then we do need to worry. 
Let us imagine that everything is kosher and absolutely as the officials have advised. Let us imagine that Craig Foss is right—that we can trust everyone who comes before a committee and says not to worry because everything will be OK Michael Cullen will do a great job and Marian Hobbs knows what she is doing. Let us imagine all that is true which is hard then even if all that is true I still think the process is wrong. I am not criticising Westpac here; I am actually criticising Parliament. I do not believe that we have given this bill proper scrutiny we have not considered it properly we are not following a correct process on behalf of 1.3 million customers and we are not actually considering the gravity of a $35 billion forced transaction. So the ACT party proudly on its own stands opposed to what is a shonky process. 
GORDON COPELAND (United Future) 
: 
 I want to take a brief call on the Westpac New Zealand Bill firstly to say that we have in the Reserve Bank of New Zealand a world-class institution. In previous lives before coming to Parliament I was aware of some of the work the bank does in its prudential supervision role of the New Zealand banking system. It is at the bank’s request and at its initiation in undertaking that role that we have this bill before us. The Reserve Bank had formed the view—and I think quite correctly—that a mere branch of a major Australian bank operating in New Zealand with hundreds of thousands of New Zealand customers and answerable completely as a branch to the board of Westpac based in Australia—if you like in a foreign jurisdiction—has risks from the point of view of people depositing with that bank in this country. 
For example if the Westpac Banking Corporation holding company the bank that actually runs the operation in Australia were to come under stress for whatever reason which could perhaps be completely unrelated to anything happening in this nation then under the four pillars policy of the Australian Government it is my understanding that Australian depositors in Westpac would be given preference over New Zealand depositors in the New Zealand branch of the Westpac Banking Corporation. That of course is a most unsatisfactory situation from the point of view of New Zealand depositors. In fact it is the Reserve Bank’s role to protect those depositors. 
I say in all honesty that those of us who were at the Finance and Expenditure Committee when the bill was considered would find the comments of the previous speaker Rodney Hide somewhat strange and I would have to say greatly misinformed. Why that should be probably has something to do with his preoccupation with dancing during the relevant period. 
But the reality is that the Reserve Bank of New Zealand has a thing called a capital adequacy ratio. Therefore when this new bank is incorporated in this country the Reserve Bank will ensure that the capital which is the difference between the assets and the liabilities of the bank will be sufficient and in line with best banking practice. Exactly the same thing will occur if Westpac New Zealand has to settle a large tax bill. To the extent that doing that drains the local company’s capital—[ 
Interruption 
]—it will be required I tell Mr Hide to inject new capital so that the protection of its New Zealand depositors is continued long on. So really the pride the ACT party has in its lone voice on this issue is I think somewhat misplaced and perhaps a humbler approach would be more appropriate in the circumstances. 
With those few words I just say that United Future will support the second reading of this bill. We will support it going through all its remaining stages in the House which I understand will be on the next members’ day 6 September. 
CHRIS TREMAIN (National—Napier) 
: 
 I rise to speak on the Westpac New Zealand Bill. It seems somehow inappropriate to be debating the Westpac New Zealand Bill at the same time as many great State events have taken place in our nation in recent days—the tangi of a Queen; the coronation of a King; the swearing-in of a new Governor-General; and the Westpac New Zealand Bill. 
Firstly I congratulate Anand Satyanand and his wife Susan on taking up the role of the 19th Governor-General of this great nation. I believe that his speech today was reflective of where our nation currently sits and that his use of Witi Ihimaera’s quote was timely given the passing of our Maori Queen and the outpouring of grief surrounding her tangi. If that quote sets the framework for the new Governor-General’s term then indeed he will be a man for our time. I wish our new Governor-General and his wife the very best in their new role. 
I will be returning to the bill in a minute Mr Assistant Speaker. I just wish to acknowledge the passing of our Maori Queen before I do that. My sympathies are shared with all New Zealanders over the passing of the Maori Queen Te Arikinui Dame Te Atairangikaahu. Her funeral marked the occasion of a great humble leader under whose tutelage we saw remarkable steps forward for her people and at the same time for all New Zealanders. I take this opportunity to wish the new King Tuheitia Paki a reign marked by achievements for his people and for all New Zealanders. Finally I mihi him with a proverb I used in my own maiden speech: “Whaia te pae tawhiti kia tata Whaia te pae tata. Whakamaua kia u kia Ti-na!” Reach to the stars for New Zealand. For your people pull them close and hold them tight. 
So in this vein it is somewhat of a let-down that we are debating the passing of the Westpac New Zealand Bill as the first legislation before Parliament following such great events. As with the new Maori King and the new Governor-General there are very few dissenters—with the exception of the ACT party in this case—and this provides somewhat of a comparison with the Westpac bill which all sides of the House support with the exception of ACT. But I guess that is where the comparisons cease. 
This bill will enable Westpac New Zealand to sever the apron strings currently binding it to its Australian parent. The bank hopes to achieve that goal in November provided that this legislation is passed through the House in good time. In that regard the new Governor-General does have some authority and connection in the granting of Royal assent to this bill. However as Marian Hobbs who is no longer in the House pointed out in regard to this legislation there needs to be an expeditious nature to the bill to get it through by 1 November. 
If the legislation is timely Westpac will incorporate on 1 November passing all its retail assets and liabilities to a new company registered here in New Zealand. Westpac is currently the only one of the four major banks in this country not locally incorporated. Reserve Bank policy is that systemically important banks should be locally incorporated to wall off the country’s financial system from problems with overseas parent banks—although I take the point made by my colleague Craig Foss who pointed out very clearly that problems in the Australian market will have a significant impact on the New Zealand market in our banking institutions. 
Local incorporation requires the establishment of an entity with its own board. Under the Reserve Bank’s conditions the New Zealand board must operate solely in the best interests of the locally incorporated bank even if this is in conflict with the parent bank and to an extent this caters to Mr Hide’s concerns. It brings an added degree of protection otherwise not available to the bank in its current structure. This is especially the case given that the Reserve Bank can veto the appointment of directors and the chief executive to their locally incorporated bank once again giving a protection to local consumers and local suppliers that the bank will be in safe hands going forward. In addition the assets and liabilities of the bank must be transferred at the same time to the New Zealand company. It is important to understand that this includes only the retail arm of the Westpac New Zealand business and that the wholesale arm will remain in a separate company that will continue to be registered in Australia. 
There is no doubt that an Act of Parliament is the best way to implement local incorporation. To do it in any other way with a transaction of the size we are talking about would be simply crazy. An Act of Parliament will result in the least disruption to all parties concerned and there are many in this case. We should remember that this bank is one of New Zealand’s four largest banking organisations and it is a transaction in the vicinity of $35 billion to $40 billion and that we are talking about 1.3 million customers and over 6000 staff. We should also remember that the bank’s biggest customer is the Government of this nation. On top of that the bank deals on a daily basis with thousands of suppliers who will also be connected with this change. The potential for disruption in the New Zealand economy is significant and therefore it is important that this change happens quickly and efficiently. Only an Act of Parliament will allow Westpac’s retail banking operations to be vested within Westpac New Zealand without affecting the conduct and continuity of the bank’s operations. 
Firstly this Act will reduce the impact on customers with very little or no disruption. Mr Hide points out that customers should have been consulted and each and every one of them should have had a copy of the bank’s new balance sheet. Well this is not to belittle customers of the Westpac Banking Corporation but I suggest that by far the majority of them would not understand the balance sheet and do indeed put their trust in the Reserve Bank of this country and in the Government to ensure that the financial capacity of the new bank is strong and that the prudential ratios are ensured. 
The bill will ensure that customers’ accounts and loans the assets and liabilities will automatically vest immediately in Westpac New Zealand. It will ensure that customers have the same relationship with the bank. It will also ensure that customers are not required to sign new security documents on the transaction changeover date. In essence the transfer should be seamless. 
Secondly the bill will also reduce the impact on the employees of the bank of which there are over 6000. The relationship between employee and employer is unaffected. There are no new employment contracts that need to be signed to effect the change and there is no detriment on employees losing their jobs or on the employer being in the position of having to pay out redundancy in this situation and then having to rehire. In this regard the transaction should be seamless. Thirdly the bill will reduce the impact on suppliers and in this regard suppliers will not have to re-contract with the bank on the day of the transfer. 
Most important the bill will minimise disruption to the banking system. It allows for the assets and liabilities to be vested immediately into the new entity therefore allowing a seamless change. It also provides for any proceedings arbitrations actions or claims against the bank to continue. Importantly it provides that property registers do not need to be changed. One can imagine having to go out there and find every property that has a bank mortgage registered against it and changing it on the property registers around the country. It would be virtually impossible. 
The bill will ensure tax neutrality. It is a key thing with an organisation of this magnitude that on GST the tax payable neutrality is maximised. As a result of this compliance with the Reserve Bank’s New Zealand incorporation policy is achieved in the most efficient manner possible for customers for staff for the banking system and for suppliers. So with the support of both sides of the House this bill should pass within the necessary time frame to meet the bank’s goals of a transfer on 1 November; failing that the transfer will be delayed until April 2007. 
Finally this may be one of the first bills for which our new Governor-General Anand Satyanand will need to provide Royal assent in order for it to pass. I am sure it will not be his most controversial but it will be an important Act for this country. 
HONE HARAWIRA (Maori Party—Te Tai Tokerau) 
: 
 I te tuatahi me mihi atu ki taku hoa ki a koe Chris e tuku poroporoaki ki to tatou Kuini a Te Atairangikaahu. E mihi atu ano hoki ki to tatou Kingi hou a Tuheitia me tena wawata ano hoki kia tu kotahi ai tatou a nga ra kei te haere mai.  First of all I thank my colleague Mr Chris Tremain for his gracious farewell to our Queen for his best wishes to our new King Tuheitia and for his hopes that we may move forward together as a nation as a result of the events in the Waikato of last week. 
Being mindful of those events I did a bit of research. I found that King Tawhiao had a Cabinet of some 12 Ministers and raised revenue himself through a variety of means—donations taxation charges fees fines and in a big way the tithing of the salaries of Maori who worked for the Government. The idea that big banks should be locally incorporated is consistent with the well-established history of Maori supporting banks that themselves support local practice.  
At the first reading of this bill I talked of the Maungatautiri Whare Uta the Maori bank established in the 1880s because local Maori were concerned that they were being cheated by Pakeha bankers and wanted control over their own economic sovereignty. In Taranaki in the 1800s Te Whiti operated a bank that apparently held many thousands of pounds. Early in the 1900s Rua Kenana established a bank under his council of elders to promote savings and to attract capital. During the 1920s Ratana’s followers also established a bank to advance funds to needy members to gather contributions and also to force the Government to recognise its obligation to provide for Maori welfare. If we fast-forward some 60 years to the very first reports admitted to the Waitangi Tribunal we find a claim by Joe Hawke and others to form the Bank of Tamaki to be administered by Ngati Whatua.  
When Marian Hobbs referred this bill she made the comment that she did not think that the Finance and Expenditure Committee needed to do the detailed work suggested by the Maori Party or the Greens. But why not? Just because my whanaunga the chairman of the committee told the House that consultation meant a fortnight’s advertising and that giving the bill to Westpac the Reserve Bank Treasury and the Inland Revenue Department was enough does not mean that the select committee should not look at positive initiatives to assist Maori development. In fact—and I am sure Mr Jones himself would agree—there are likely to be some very good ideas coming out of some of the big Maori agencies such as the New Zealand Maori Council the Federation of Maori Authorities Ngai Tahu Finance Te Ohu Kai Moana itself the Poutama Trust and even Maori Women’s Development Inc. launched back in the 1980s to provide loans to Maori to help set up and expand existing businesses and to provide financial advice and mentoring services. Interestingly Maori Women’s Development Inc. grew out of the Hui Taumata of 1984 when it was suggested by Mr Jones’ relation Ripeka Evans that Maori should revolutionise the tax system and channel all taxes back into a Maori development bank. Sir Tipene O’Regan himself also supported the call for a Maori development bank to enable Maori to better utilise the equity tied up in tribal lands. Even Denese Henare spoke in support of a Maori bank to administer finance for housing land purchase farming and business development.  
The idea of Maori owning a bank and controlling local savings and investments even came up at last year’s Hui Taumata. In fact this is an idea whose time has come. The Toi - Economic Development Agency which promotes regional development in the Eastern Bay of Plenty is a good example. This group involves economic leaders such as investment banker Taari Nicholas; Rikirangi Gage chief executive officer ofTe Runanga o Te Whanau a Apanui; Joe Mason director forNgati Awa Group Holdings; and others. Since successive Governments have been unwilling to provide the necessary financing for Maori initiatives such as the Toi - Economic Development Agency are important in laying a path towards self-determination.  
We recognise Westpac’s urgency in getting this bill through by 1 November to ensure the vesting of assets and liability to Westpac New Zealand but our support for this bill is because we absolutely support the principle that the rules of this nation should control the banking system of Aotearoa. That support is also in line with the longstanding call in Maoridom for banking to reflect local economic development. We note however that little has changed really since 1984 when Koro Wetere suggested that banks and development corporations look seriously at how to assist Maori to foster commercial and banking skills to drive our economic advancement. 
 There are other areas for improvement before this bill becomes law. Firstly the haste to get this bill through must not occur at the expense of poor industrial relations. As my friend Sue Bradford mentioned at the first reading Westpac the winner of the Roger Award for the worst transnational operating in New Zealand in 2006 has dropped 25 percent of its staff over the past 10 years and has forced the reduced staff to increase their profit output by 110 percent and net profit by nearly 400 percent. Westpac also has a very poor record with the finance workers union in respect of holiday infringements working overtime without compensation high workload pressure to work through sickness injury and pregnancy poor staff support and huge performance expectations that are not matched by performance payments. 
Secondly Westpac might wish to review its lending and investment policies and its assistance to Maori to ensure that investment does not lead to failures such as those that have happened in the past as described by Denese Henare—failures in terms of poor land utilisation inactive trusts underfunded development schemes poor business planning and inadequate lending for housing. 
Finally we note the point raised by Mr Rodney Hide who warned against Westpac customers being forced into a new company without knowing what assets and liabilities would back their investments. Westpac’s record profit of $708 million suggests that it certainly has the money for a simple mail-out to advise companies of the implications of the transfer of assets and liabilities. 
The Maori Party will support this bill at the second reading but we look forward to seeing a huge improvement in Westpac’s employment relations and an equal improvement in its helping to advance Maori interests for the benefit of the whole nation. Kia ora tatou katoa. 
SHANE JONES (Labour) 
: 
 I rise to take a short call in relation to the Westpac New Zealand Bill. I had the pleasure of chairing the Finance and Expenditure Committee that dealt with this bill. Yes we did form a view that consultation regarding every nook and cranny was not necessary. Yes we were conscious of the time exigencies related to this bill. We sought and took quality advice from helpful agencies including the Reserve Bank. 
I refer in particular to a point that the honourable member Mr Hide made. Although he made a very good point I rather fear that the one or three members of the public who might be interested in listening to this debate—which is actually rhetoric in inverse proportions to the content of the bill—may be left with a mistaken assumption. The bill most certainly provides for safeguards in relation to the construction and presentation of a proposal to enable the transfer of assets to take place. 
Earlier Mr Hide reflected his deep anxieties that because the Minister and not members of this House or some other organ of the House was dealing with the proposed transfer there might be a weaker accountability. Part 2 deals with the vesting of designated assets and liabilities and in clause 6 the Governor-General on the advice of the Minister after he or she has received the recommendation from the Reserve Bank of New Zealand will or shall consider and may approve a proposal. That proposal not only specifies the appointed day but also describes the designated assets and liabilities. Along with Mr Gordon Copeland our committee was left with no doubts about the quality of judgment and the expertise of a prudential nature in the Reserve Bank to provide a high-quality stream of advice to the Minister. 
Yes this is a massive enterprise. Yes there are many savers and employees and the sums of money are large but it is based on an important principle. The principle is that in the event that there was a failure of a systemic nature and it had Australasian dimensions then those assets and those aspects of Westpac’s business that are domiciled here in Aotearoa New Zealand must not cannot and should not be spirited away to solve other problems in the massive network of the Westpac bank. 
 Of course that is a subset of a large issue and the issue is between the Reserve Bank of Australia and the Reserve Bank of New Zealand. Given the development of closer relations in our Australasian interests how are we to ensure that the very banking system that we rely on to provide the lifeblood of day-to-day business and the smooth functioning of the economy remains under adequate prudential oversight? I followed with considerable interest over the last couple of years whether the role that our own Reserve Bank of New Zealand might occupy in that prudential exercise is to be as an adjunct or subservient to the Reserve Bank of Australia. 
In the course of consideration of the bill the side issue of whether our Reserve Bank of New Zealand would be capable of fulfilling this role was discussed very briefly. We were told that not only would it have the ability to discharge its role in relation to prudential oversight but also that we and the bank would not be surrendering an unnecessary level of control to the Reserve Bank of Australia and that there would be more news and developments on that matter. But it is a key point that goes to the nature of our status and the ability for us to rely on political or governmental sovereignty when we make laws to ensure that we are not surrendering far too much to the Reserve Bank of Australia. So for those who are doubting Thomases and are bothered as to whether our Reserve Bank has the ability to fulfil the task I feel and said so at the time during the course of the Finance and Expenditure Committee’s considerations and discussions that those fears are misplaced. 
This is a big enterprise. The bank is looking forward to us dealing with it expeditiously. The committee I feel dealt with it in a very professional and thorough manner and like all matters of a technical nature one relies on the quality and the integrity of the advice. That came from other places yes but predominantly from the Reserve Bank of New Zealand and I have not a sliver of doubt about the quality of the advice we received. 
KEITH LOCKE (Green) 
: 
 The Green Party will be supporting this bill. We think that legislating the incorporation of Westpac is a move in the right direction. Westpac has been the hold-out bank that resisted pressures in that direction through 2004 arguing that it was very unlikely there would be a collapse of the bank so people did not need to get worried. But as Rodney Hide pointed out there are no guarantees against a bank failing. The problem is that if the bank had failed as a purely Australian bank New Zealanders might not have got anything out of it. There were no guarantees that what money there was would not have been paid to Australians before New Zealanders. 
We have had a history of failure of financial institutions in New Zealand including banks. The BNZ in the 1980s was a prime case from the banking system. Of course systems have been improved since then in terms of the monitoring of banks and speakers today have referred to some of the ways in which the newly incorporated Westpac bank will be monitored. 
I think there is some problem for New Zealand society in the way that all our banks except for the TSB Bank have been taken over by foreign banks particularly Australian banks. It is a large part of our bigger problem of having $80 billion of foreign-owned assets in New Zealand whereas New Zealanders own only $20 billion in assets overseas. That difference in terms of dividend transfers is a major contributor to our huge current account deficit of $14.5 billion. As Hone Harawira just pointed out the profit of the Westpac bank is $708 million and a lot of that profit is being sent back to Australia along with profit from all the other banking institutions that are Australian owned. It is a big problem as I say in our current account deficit. 
Australian-owned banks including Westpac have not always played very fair in New Zealand society. There was of course a big battle with the Commerce Commission over currency transaction fees relating to credit cards. It is interesting to note that Westpac was the worst offender in that respect. As of 2004 it had four types of credit card and the currency conversion rates ranged from 2.95 percent to 3.05 percent whereas the New Zealand-owned bank the TSB Bank had the lowest rate of 1.75 percent. The banks that offended in that way were forced by the Commerce Commission to apologise to their customers. The banks’ argument that the currency conversion fee could be seen just as part of the exchange rate was not accepted. So we are not looking at owners who have New Zealanders’ interests foremost in that respect. 
Another problem for New Zealand society is the way in which the banking system has operated particularly in the absence of any capital gains tax on housing—not of course in terms of one’s own home but in terms of investment housing beyond one’s own home. In respect of that investment money has really poured in from Australia. I think there has been about $30 billion of foreign-owned money pouring in over the last 2½ years and that is essentially equivalent to the extra amount that has gone into housing with the value of housing loans over the last 8 years going from $55 billion to $130 billion. That is a huge burden on this economy and when we pay our mortgages a lot of that money does disappear back to Australia and a lot of it does disappear back to Westpac. 
So that is a problem we have to bear in mind and we have to keep a very close scrutiny on those Australian-owned banks. It is good that they will now be locally incorporated and that we will be able to apply proper supervision to them. 
A party vote was called for on the question  
That the Westpac New Zealand Bill be now read a second time. 
Ayes 119 
New Zealand Labour 50; New Zealand National 48; New Zealand First 7; Green Party 6; Maori Party 4; United Future 3; Progressive 1. 
Noes 2 
ACT New Zealand 2. 
Bill read a second time. 
Local Government (Rating Cap) Amendment Bill 
First Reading 
Debate resumed from 26 July. 
GORDON COPELAND (United Future) 
: 
 When I first read through the arithmetic set out in the first and second clauses of the Local Government (Rating Cap) Amendment Bill it was a little bit like déjà vu. I thought to myself that it was an interesting way of tackling legislation in the 21st century. The bill seeks to regulate rates by putting in place a formula which is the movement in the consumer price index plus 2 percent in the first 12 months or the consumer price index plus no more than 4 percent over a 3-year period—about 1.3 percent per annum in addition to the consumer price index. 
 When I read that I thought to myself that it was very reminiscent of the kind of legislation we used to see under Rob Muldoon. That thought was further strengthened when I got down to clause 3 where I read that if a local authority wishes to exceed that cap it can ask the Minister of Local Government to make a decision about it. So I thought that that was the kind of cap the bill had in mind. It has local authorities duly elected by the citizens of that territory going cap in hand to the Minister and saying: “Minister can we please take our rates up next year by let’s say consumer price index plus 2.5 percent? Would that be OK?”. Really at that stage I asked myself whose bill it was. I actually thought I would see the name “Robert Muldoon” on the bill but it turned out to be “Rodney Hide”. I am amazed that a bill like this has actually come from the ACT party because it is not the kind of approach I associate with the history of ACT. However it is the kind of approach I associate very strongly with Muldoon who in the immortal words of David Lange ran the country like a Polish shipyard. I think that was a bit of an insult to Polish shipyards in many ways. 
The fundamental problem I have with the bill is that it is contrary to United Future’s political philosophy which is dependent on subsidiarity—namely that we devolve political decision-making to the appropriate level and that local authorities duly elected by their citizens should be making decisions on behalf of their communities and that includes decisions about rates. 
Having said that members might be surprised to hear we are going to vote in favour of the bill. It is simply a quirk of fate that the drawing of this bill from the ballot—and I congratulate Rodney Hide on being successful in the ballot—coincided with massive outrage right throughout this country but particularly in Auckland about the fact that rates increases have now become unsustainable for many of our citizens. We know for example that in Auckland City the cost of water is going up by 9 percent and the cost of rates is also going up by about that percentage or more. For many people now that is just too much. There is great concern particularly amongst those people on fixed incomes and in their retirement years that that is just not affordable. Therefore our vote in favour of this bill is to signal United Future’s strong support for an inquiry into local government in New Zealand and the reason why we are seeing these massive rates increases occurring. 
I know that the Local Government and Environment Committee has already said it wants to have an inquiry. We think that might be useful but it will not get the job done. We want there to be an independent commission of inquiry into the whole structure of local government in this country. After all when one really thinks it through one realises that these massive rates increases are just a symptom of many things; perhaps it might be local and central government duplication of effort or perhaps the massive forward plans that local bodies now do at great cost—they circulate books of the size of the Wellington phone book to every citizen in their city stating their plan for the next 10 years. I wonder whether we have now reached the stage of paralysis through analysis which really is like it was under Rob Muldoon as well. With those reservations we support the first reading of the bill. 
MARK BLUMSKY (National) 
: 
 I have a real sense of déjà vu standing here talking about rates in Parliament because 6 years ago I was very much involved in the game of setting rates. Little did I think that 6 years later I would be standing here in Parliament talking about rates. But I can assure members now that a lot has obviously happened in those last 6 years within local government regarding rates. More and more ratepayers are highly dissatisfied and are just bloody angry with the levels of rates that are being set around the country. They want to apportion blame. Members just need to listen to talkback radio and read the newspapers to see that ratepayers want to apportion blame. Local government has lost touch with its ratepayers. 
But what is more concerning is that when I have been moving round the country talking to local government leaders I have seen there is real frustration anger and helplessness being felt by local government leaders in New Zealand. Why? Because local government leaders are losing local leadership. Compliance and paperwork being thrown at them by this Government are swamping them. There is a real concern within local government that it is losing its local leadership. To quote from a report by a very senior long-time chief executive officer in local government: “The processes associated with our business have been made more complex as a result of the 2002 legislation. I fear we will see a growth in the relative power and influence of the salaried official. As processes dominate and become more complicated the role of the official will be enhanced and as a consequence the role of the elected member will be diminished.” 
This Government is redefining the role of local government by all the compliance work and legislation that it is putting on local government. This Government is being very prescriptive and not allowing local solutions for local problems for local issues. One size does not fit all. A message is being sent to the Government by ratepayers: they want local solutions; they want local government to be elected to do what they want local government to do not what this Government wants it to do. This Government’s provisions about compliance and standards put a huge cost on local government. The Prime Minister is wrong. She had her head in the sand when she said on 7 August that the ultimate course of action for people who do not like rate rises is to vote the council out at the next election. I say to Helen Clark Prime Minister that it is not all the councils’ fault. A lot of the problems with rates are the Prime Minister’s fault and she has to front up to that. She should be under no illusion that the compliance costs arising from the audit requirement the Building Act and the legislation on gambling prostitution dog microchipping—there is a list of 67 Acts in which she has put compliance costs on local government—have impacted on rates. 
Then the Prime Minister and the Government members talk standards. They want to bring in a new water standard. Believe it or not a little council like that in Waimate which I had the pleasure of visiting had to spend $500000 to service 34 households. That is disgraceful. Leadership needs to be shown by local government. Ratepayers need and deserve answers and they need to be given new tools and new confidence that the current situation will be changed and rectified—hence National’s support for this bill to allow that opportunity to happen. 
There is talk of an inquiry. I have not seen the terms of reference. Also there is an issue to do with my confidence in how an inquiry would operate and how independent it would be. The previous history of this Government with its inquiries—as with Dr Ingram’s inquiry—does not give me confidence that the correct answer will be delivered. The ratepayers in New Zealand deserve the correct answer because their rates are too high. The Government has to stand up and take some responsibility for that. 
MARTIN GALLAGHER (Labour—Hamilton West) 
: 
 The aim of the Local Government (Rating Cap) Amendment Bill is as I understand it to amend the Local Government (Rating) Act 2002 to limit the increase in rates revenue sought by a local authority in any year. The bill provides for a maximum rate increase in any year of the rate of consumer price inflation for the preceding year plus 2 percent. The maximum in any 3-year period is to be the rate of consumer price inflation for the preceding 3 years plus 4 percent. 
I find it somewhat surprising that the former Mayor of Wellington which is a very lovely and great city in my view—nearly as good as Hamilton—would actually support a bill whereby the central government of the day could— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: I am sorry to interrupt the honourable member but the time has come for me to leave the Chair for the dinner break. 
Sitting suspended from 6 p.m. to 7.30 p.m. 
MARTIN GALLAGHER 
: Obviously I do not support this bill but I assure the Speaker that I will not be engaging in the kind of personal attack we witnessed in the general debate by Chris Finlayson on the Minister of Revenue the Hon Peter Dunne. I thought that was the most appalling attack on a member that I have heard for some time. It was quite incredible. 
Hon Ruth Dyson 
: What was that? 
MARTIN GALLAGHER 
: That was Chris Finlayson maligning the integrity of the Hon Peter Dunne. It was quite a bizarre attack. 
I do not agree with this bill but I will not attack its author. What I will say is that I believe that this bill would take us to an era of central government control through the Minister of Local Government irrespective of who that Minister was and what that Minister’s political shade might be. It would effectively destroy local decision-making local accountability and in fact local government. The Local Government Act has a very very rigorous form of community accountability. It is called the 10-year plan and it is reviewed on an annualised basis. 
Speaking as a citizen from Hamilton I say that we have a very very good council. We have an excellent mayor Michael Redman and an excellent council team. I do not want a Minister of Local Government of whatever political colour to be dictating to people in the Waikato and in Hamilton as to what projects we can undertake and how we structure our budget. This bill would mean for example that if we needed a special rate to build the wonderful Waikato Stadium which took us above the criteria of this bill we would have to go cap in hand literally and beg the Minister of Local Government of the day for the funds to do that. That is not local democracy; that is not local accountability. 
The argument very clearly and concisely is simply this: we have two tiers of government in this country. Lest this Parliament should forget there is another tier of democratic governance in this country. We are not the only game in town so to speak—there are councils up and down the country which citizens elect and which also have a democratic mandate in their own right. 
Obviously I agree to differ with the author of this bill about how we address what is the significant issue of how we fund and finance local government. As a former deputy mayor of Hamilton and also as a member of the Local Government and Environment Committee I acknowledge that the issue of what is a fair and equitable way of funding local government is a very significant one. I commend our very good Minister of Local Government Mr Mark Burton who today announced the establishment of an independent inquiry into issues around local government rates funding. In fact the Minister has stated: “The Government will develop the inquiry’s terms of reference in consultation with other parties. The terms of reference and other details will be released in due course.” The Minister also said and I think it is a very good quote: “This is an important issue which is concerning central government local government and ratepayers. The … Government believes an independent inquiry is the best way to consider these issues. We have been working closely with New Zealand First because like us they are concerned to ensure that this issue is dealt with in an independent manner. I look forward to wide parliamentary support for this inquiry process.” Indeed the Minister stated: “The inquiry will be able to consider the work of the joint Central Government/Local Authority funding project which will report to the Central Government/Local Government Forum in October.” 
Quite frankly I pay tribute to the work that Local Government New Zealand mayors councils and chairs of regional councils are already doing in this country. This is about local democracy. We in Parliament acknowledge that we have to look at more innovative ways of funding local government. I also acknowledge the huge transfer of taxpayer funds from central government in Wellington to local government projects that is already in effect. Let me acknowledge that it is at an all-time record. I do not agree with this bill. The independent inquiry is the way to go. 
TE URUROA FLAVELL (Maori Party—Waiariki) 
: 
 Kia ora tatou. I am pleased to stand this evening to contribute to the debate on the premise that the Maori Party supports initiatives where accountability and transparency are important. As others have mentioned the bill amends the Local Government (Rating) Act 2002 by capping the level of rates increases that local authorities may impose on residents. It stops local authorities setting excessive increases. 
For tangata whenua the history of rating in Aotearoa has been variable and inconsistent. Our research tells us that in 1883 the Property-Tax Department was found to be valuing Maori land at well above the market rate. This was at a time when the Government reimbursed local authorities directly for rates owing on Maori land. In another incident in 1915 we learnt that lands in the King Country were being valued low in order to make it easier for Europeans to buy them. The argument was that the land was worthless. Indeed it was worthless because it was in multiple ownership. So the manipulation of valuation legislation is unfortunately a shameful part of our history and Maori have been rated off our lands. Large tracts of Maori freehold land are unoccupied and unimproved. This land creates a significant rating burden on the Maori owners who often do not have the means or in some cases the desire to make economic use of the land. Often that is due to the nature of the ownership or perhaps because the land has some special significance that will make it undesirable to develop or reside on or perhaps because it is isolated and marginal in quality. 
I understand that schedule 11 of the Local Government Act 2002 supported the use of Maori land by the owners for traditional purposes. It was also introduced to make it easy for owners to develop the land for economic use while taking into account the presence of wahi tapu that may affect the use of the land for other purposes. I understand also that section 91 of the Local Government (Rating) Act requires that Maori freehold land be liable for rates in the same manner as if it were general land. But what has happened in the last few years is that tangata whenua have experienced excessive rates increases of three to four times the inflation rate which are imposed by some councils. As I say in essence Maori are being rated off our lands. That is why the Maori Party voted against lump-sum payments for capital projects in the Local Government Law Reform Bill which were just another form of rating increase. 
Pita Rykers in his paper “Valuation and Rating of Maori Lands” stated that it was critical for Maori to get the power relationship right via a clear Treaty statement and the provision of effective mechanisms and structures. Mechanisms must provide real accountability and the structures must allow for effective rangatiratanga. The Maori Party believes that mana whenua should have an equal say with local and regional authorities on all matters concerned with the rating or non-rating of Maori land. We also believe that Maori and the wider public should have a say as to whether a rating cap is the best way to regulate and monitor rates increases and whether the current method of assessing rates is the best one. There are real issues there for Maori people’s relationship to the land and the practical circumstances of Maori land held in joint ownership. 
We look forward to this bill providing clarity transparency and accountability in establishing the critical foundation that our whenua provides in our world view. We cannot underestimate the crucial importance of whenua in our world view. In 1987 in the court case  
New Zealand Maori Council and Latimer 
 v  
Attorney-General and Others 
 the New Zealand Maori Council stated: “[Maori land] provides us with a sense of identity belonging and continuity. It is proof of our continued existence not only as a people but as the tangata whenua of this country. It is proof of our tribal and kin group ties. Maori land represents turangawaewae. It is proof of our link with the ancestors of our past and with the generations yet to come. It is an assurance that we shall forever exist as a people for as long as the land shall last.” These are the values that we bring to the discussion of this bill as we do with every other bill coming before the House. 
We will vote to support this bill based on our belief that controls and consistency need to be in place so that we can stay on our land care for our land and be tangata whenua in the truest form. Kia ora tatou. 
RODNEY HIDE (Leader—ACT) 
: 
 May I thank the Maori Party members for their support for the bill and indeed for their analysis and for the realisation that Maori were the first people in New Zealand to feel the effect of outrageous rates forcing them off their land and the fact that now many New Zealanders particularly the elderly and those on a fixed income are feeling what Maori felt 100 years ago. I should also acknowledge National Party members for their contribution and their support and also too United Future. 
Indeed United Future’s contribution was through Gordon Copeland and he suggested to me that allowing the cap to be broken with the permission of the Minister of Local Government was a bit Muldoonist. I put that in there because I thought it was a cheap way of providing some transparency and I certainly believe that it is a mistake. I suggest that we should have a cap and if councils want to break that cap for good reason then let us have a local referendum and get the permission of the people who will be paying the rates—that is the ratepayers. We heard a lot today about democracy but true democracy would be to say that if we are going to put up rates we should get the people’s consent first. I am sure if there is a good reason for putting up rates they will give their consent. 
I have to say that I am not surprised at the Labour Party opposing this bill. I notice Labour members spoke at length about 10-year plans and how they will provide a democracy. I know they do not say 5-year plans because they have a rather bad connotation so they have gone one better than Stalin. Labour will have a 10-year plan for New Zealanders which will see more New Zealanders forced off their property. How sad is that? 
We all as MPs know of people who have worked hard built their houses paid off their mortgages and raised their children. Yes they have had the windfall of their properties going up in value because of rising property values but to them those properties are their homes. Then their rates go up but they are pensioners of a fixed value and they cannot afford to pay the rates. The council tells them either to take out a loan—that is go back to having a mortgage like a young couple starting out 40 or 50 years ago—or sell up. It is as if we have New Zealanders living in a home that they own but they rent it from local government; if they cannot pay the rent they will get kicked out. That is what my bill with the support of National United Future and the Maori Party was designed to stop. 
It is Parliament that gives local government the power to strike rates. It is Parliament that sets the rules. I was saying through this bill that we should set a rule for the amount by which local councils can increase rates in any one year and if they want to go above that amount they should get the permission of the people. That is democracy. Ask the Maori people whether they want to pay more rates for the service they will get as a consequence; let us not just take it. 
I have to say that I am disappointed with New Zealand First members—that will not come as a shock to them—and that the people of New Zealand are disappointed with New Zealand First. I was surprised by Doug Woolerton’s attack on Grey Power today—for what? Not being sufficiently in love with New Zealand First; not going along with everything New Zealand First does? But New Zealand First members voted for my bill—an identical bill to this—in 2004. They thought it was a good idea for it to go to the select committee so the people could have their say. It was all right then but now it is not. What has happened since then? The only thing that has happened since then is that people’s rates have gone up. Oh and there is one other thing: Winston has got his bauble and he no longer cares. If he can keep his bauble then it is to hell with the people and their rates. 
I ask members to look at this newspaper I am holding. I am quite proud of this headline which reads “Finally action on rates”. That is because of what this bill has done the people of New Zealand have done and this Parliament has done. Finally is it action? Well we will see. Look at these rates increases I say to Mr Brown and Mr Peters Auckland City 13.4 percent Tauranga 13 percent Rodney District 10.2 percent and North Shore City 9.5 percent. The Sheriff of Nottingham would blush at those sorts of increases. He never threw old people out of their houses but New Zealand First is saying it is OK for local government to throw people out of their houses particularly if they are old. [ 
Interruption 
] Brian Donnelly is saying yes that is what New Zealand First is saying—throw them out of their houses. 
What will we have? Mr Peters and his bauble and some inquiry announced by press release which we have not seen. There have been no terms of reference and no promise. This bill will put an end to rate increases. I say to New Zealand First members that they should vote for it. 
A party vote was called for on the question  
That the Local Government (Rating Cap) Amendment Bill be now read a first time. 
Ayes 57 
New Zealand National 48; Maori Party 4; United Future 3; ACT New Zealand 2. 
Noes 64 
New Zealand Labour 50; New Zealand First 7; Green Party 6; Progressive 1. 
Motion not agreed to. 
Minimum Wage and Remuneration Amendment Bill 
First Reading 
DARIEN FENTON (Labour) 
: 
 I move  
That the Minimum Wage and Remuneration Amendment Bill be now read a first time. 
 It gives me great pleasure to introduce the first reading of this bill and at the appropriate time I intend to move that the bill be considered by the Transport and Industrial Relations Committee. The Minimum Wage and Remuneration Amendment Bill provides that the Governor-General is able by Order in Council to make regulations prescribing the minimum rates of remuneration payable to any person working under a contract for services. Such minimum rates may be prescribed as a monetary amount or as a percentage of any other minimum rate prescribed under the regulations. 
The bill does not attempt to define the difference between independent contractors and employees. It simply sets out a process for minimum remuneration to be determined for contractors and enables that to be enforced. Contractors lack the most fundamental of protections—the right to be paid no less than what is considered socially acceptable for other workers who have the protection of the minimum wage. Minimum remuneration is a baseline protection and should apply equally to all workers regardless of whether they are in a traditional employment relationship or whether they have entered into a contract for services. This bill will provide that protection. 
The intent of the bill is not to defeat agreements being made under commercial relationships between two parties. It is not designed to restrict those who are entrepreneurs making whatever arrangements suit when contracting for services but there is a difference between workers who depend on selling their services in order to survive and entrepreneurs who invest capital and hire workers. 
Like the rest of the world New Zealand has experienced a rapidly changing labour market. The nature of the world of work has changed dramatically and will continue to change in the future. Over the past 15 years there has been a growth in non-standard employment from full-time permanent employment to part-time casual temporary and contracted jobs. Employment patterns in a range of sectors and industries have changed drastically and contract work is becoming one of the most preferred work arrangements of employers throughout the world. It is the new casualisation. As with almost all atypical work contracting is contributing to a growing disparity between the actual results of the labour market and labour laws where protections for workers are based on the traditional employment relationship. 
New Zealand has seen considerable growth in the number of self-employed as a percentage of the total workforce. Approximately 20 percent of the labour market is described as self-employed and is likely to be working under a contract for services. Who are these workers? Many immigrants opt for this kind of employment because of the difficulty in obtaining suitable waged or salaried employment. They are likely to be Maori and Pacific Islanders. New Zealand women are becoming self-employed at over twice the rate of men yet most of those businesses start smaller remain smaller and generate lower incomes. 
 Contract workers are used in both the private and public sectors in a broad range of industries. There are many reasons why firms often prefer to obtain services through means other than employment contracts such as simplified payroll and human resources administration and greater flexibility in terms of dealing with workers. For many contract workers this works well and in fact they will be earning well above the equivalent to the current minimum wage. But having no floor above which remuneration can be paid means that some companies are unfairly exploiting the competition between contractors. 
Contracting arrangements are often used for the purpose of denying rights and avoiding obligations under labour laws. Where independent and dependent contracting is used improperly the consequences for those who perform the work are losses in wages job security and working conditions. Differences in the treatment of workers on the basis of the contractual form of their work relationship can induce the stronger party usually the purchaser of labour to create less-regulated commercial relationships over more-regulated employment relationships. This creates a downward pressure on wages working conditions and living standards for other workers. 
Numerous examples of contracting are occurring in New Zealand including for example in personal care forestry construction courier services transport agriculture and telecommunications. Pamphlet and newspaper deliveries used to be the domain of young people trying to earn a few extra dollars but today parents and older people are very often contracted for these deliveries. Although some of us might think it is OK to pay young workers very little—and I am not one of them—this kind of contract work becomes a real problem when families and older workers are relying on it as a source of income. 
Contracting often comes in the guise of a commercial contract in which labour is the main service provided. Contractors work for one employer or company or even a former employer. Although the Employment Relations Authority has the ability to investigate the real nature of an employment relationship—and there is established case law on the definitions of contractors versus employees—workers can be accorded the status rights and protections of employees only if they undertake the risk and expense of challenging their employer in court. 
This bill is not about whether or not someone is an employee but whether that person should be afforded some basic protection in law. Social security health and safety protection and accident compensation are already provided to workers who are not considered employees. So what is so different about providing the protection of a minimum level of remuneration? Information on contractors and what they are paid is not available in New Zealand. I have no doubt that at the select committee there will be many complex arguments about different arrangements and they will need to be considered carefully. But this bill raises the question of whether we consider it acceptable in a First World economy like New Zealand’s to allow arrangements whereby workers can be used to work for less than a socially accepted minimum remuneration. 
My bill will provide minimum protection for those contractors who have little experience and no advice and who are vulnerable to exploitation. It will also put some minimal controls on the vicious practice of underbidding for contracts for services. If we are serious about improving the earnings of all New Zealanders this House cannot continue to ignore the growing group of workers who make an important contribution to our economy and our society but who are denied this most basic right in law to minimum pay. New Zealanders believe in fairness and this means ensuring some equality of treatment for workers regardless of their legal employment status. We need this most basic of protections to reflect the realities of new forms of work and to keep pace with the changing world of work in the 21st century. 
Dr WAYNE MAPP (National—North Shore) 
: 
 It certainly is embarrassing is it not to see in the House tonight Mr Phillip Field who I guess has been press-ganged today into voting for the Minimum Wage and Remuneration Amendment Bill. In fact I saw the whip approach him earlier. Was there a bit of a question as to how Mr Field would vote on the bill? Will he eat—I guess one might say—humble pie and curry favour? Will he speak on the bill because I would certainly be very interested in what he had to say? What is even more remarkable is that Labour would have the gall to introduce the bill at this stage. This will not help its situation of embarrassment. 
I draw the House’s attention to this particular fact in the Ingram report. I asked a question today of the Minister of Labour who is sitting in the House tonight. My question was really quite straightforward and I will read it out again just for the Minister’s benefit: “Does the Minister have any concerns that Dr Ingram was not satisfied about the authenticity of the invoices provided by Mr Field for the work at 51 Church Street and surely that means the department must investigate whether these people were in fact employees”. Do members know what her answer was? She was not concerned; she did not care that Dr Ingram questioned the authenticity of invoices. This is important because it actually goes to the very heart of work relationships. Genuine invoices such as Dr Ingram expected to see are evidence of an independent contract relationship. The authenticity of the invoices has been extensively questioned in the report and if the Minister of Labour cared to read the report—I guess she has not done so—she would know he raised the gravest of questions about the authenticity of those invoices. 
When one has to raise that question the issue becomes whether those people were employees. I have to say I believe the Department of Labour which has independent investigatory powers under both the minimum wages legislation and the Employment Relations Act should be digging deep on that issue. The validity or “authenticity”—to use Dr Ingram’s word—of those invoices goes to the very question of the relationship. If they are authentic then one might say the people are independent contractors. If they are not authentic and that is what Dr Ingram questioned— 
Taito Phillip Field 
: How did you get your PhD? 
Dr WAYNE MAPP 
: Mr Field went on national television and said he had been completely vindicated. What an absurd statement that was to anyone who had actually read the report—he had not been vindicated. Mr Field actually had read the report; he had it with his lawyers for months in advance trying to get Dr Ingram to change his mind. Well Dr Ingram was not fooled by any of that particular nonsense and he made extremely critical findings on Mr Field. The invoices were one of the key issues. I will be watching television this Sunday night because the nature of those invoices will be raised in a television programme. 
As I say that issue goes to the very heart of the bill. A valid independent contractor relationship is in the words of Darien Fenton a contract of services. That is in contrast to a contract for services. 
Hon Members 
: For services. 
Dr WAYNE MAPP 
: That is correct. The independent contract is a contract for services; the employment relationship is a contract of services. A lot of laypeople will not necessarily understand that term. The practical difference is this: does the person do the work according to the instructions of the employer? If the person does the work in accordance with the instructions of the employer then he or she is an employee. If on the other hand the person is simply doing the job—building a house painting a wall mowing a lawn—and it is left up to the individual how he or she does the work and in other words it is not directed then he or she is basically an independent contractor. It is not the case there that the law should be intervening because in truth people have choices; they have freedom. 
 That is the philosophical point that the member simply does not understand. How on earth Darien Fenton managed to convince her colleagues to vote for this frankly ridiculous bill truly baffles me. This week she has been the subject of an  
Investigate 
 article. On this side of the House we talk about the “stench of corruption”—it sits on the other side of the House. I ask how Darien Fenton in her union role managed to spend $240000 on her election and that of her employers. I ask that member whether that was declared in Labour Party spending. 
Hon Members 
: Oh no! 
Dr WAYNE MAPP 
: Oh no! I guess it certainly was not. So a Labour list candidate was directing how money would be spent on a campaign then not declaring it. That is exactly the same problem we see with the Prime Minister. They are in the scheme of denial. What will they do? I guess they will be asking their mates in the New Zealand First Party to help them out by supporting some retrospective legislation. I say to the New Zealand First Party: “Don’t be fooled; don’t be sucked in.” I say to the United Future party: “Don’t be fooled; don’t be sucked in.” People who grossly exceed their spending limits ought to pay a real sanction and that is one of two things. As Dr Brash said today when a Government steals an election it ends up as has happened in many other countries resigning. 
So to have this ridiculous bill presented to us today by a member of Parliament who is guilty of what I would have to say looks like corrupt electoral practices just rankles. Apart from the complete philosophical inconsistencies that are represented by this bill this House and this country deserve better than this Government; and the sooner it goes the better. 
GORDON COPELAND (United Future) 
: 
 I rise to take a brief call on the Minimum Wage and Remuneration Amendment Bill. Firstly I congratulate Darien Fenton on having a bill drawn in the ballot. I know from my first term in Parliament that it is always quite a thrill. It would be like winning Lotto. 
Hon Harry Duynhoven 
: In your first term? 
GORDON COPELAND 
: I had two in my first term actually. One bill has gone to the select committee and is still languishing there and the other was voted against by both National and Labour. But that is another story for another day. 
I think the principle of ensuring that all people in New Zealand undertaking work receive the minimum wage is a sound one based on social justice and all New Zealanders want to ensure that—at least insofar as Parliament can ensure—people receive a minimum rate of pay for the work they do. Of course many people fall below an acceptable standard of living in any event because of addictions family problems and all sorts of other things that are part and parcel of the human condition. We can do nothing about that through legislation but we can at least say there is a basic minimum wage below which we are not prepared to see anyone fall. I think that from that point of view there is an issue the bill addresses. 
Having said that however we also acknowledge the other side of the coin and that is traditionally the situation when for example I call for tenders for people to paint my house and I get four or five prices. I look at all the people to see whether they have some general competence in painting decide to accept a price and expect my house to be painted for that price. If it ends up that the person doing the painting works twice as many hours as he or she forecast when putting the contract in place—which may mean that on an hourly basis the person gets well below the minimum wage—then under our system that is kind of tough. So the person has to be experienced enough to try to figure that out correctly and ensure a sufficient wage. 
When we consider the practicalities of trying to put in place a bill like this we may just find that it is not practicable to do so. Bearing the pluses and minuses in mind United Future has decided it will vote for this bill to go to the select committee. That will at least give people an opportunity to make submissions and for the committee to see whether the bill is sound or fundamentally flawed. In saying that I also need to signal that our support is for the first reading only and is not assured beyond that stage. 
HONE HARAWIRA (Maori Party—Te Tai Tokerau) 
: 
 Kia ora tatou te Whare.There has been a lot of debate in the media about whether we can afford to increase the minimum wage. Earlier this year we saw a big debate over Sue Bradford’s bill to amend the minimum wage order in order to stop employers setting low youth rates and now we have this bill to amend the Act to ensure that contractors are also covered. The questions are how much will it cost and can we afford it? In fact the real question is whether we can afford not to. The minimum wage is $10.25 an hour and the minimum youth wage is $8.20. That is simply not enough. 
Just a couple of weeks back while the House was in adjournment the Government tabled the  
Social Report 2006 
 which showed what we have been saying for yonks—that is the number of poor people in this country has nearly doubled in only 6 years. The proportion of the population with low incomes shows that 19 percent were living below the 60 percent threshold in 2004 compared with just 12 percent in 1998 and that those experiencing severe hardship had greatly increased as well. The same report also pointed out that the proportion of poor people who spend more than 30 percent of their income on housing has more than doubled in that time. 
It is not just about the rich getting richer and the poor getting poorer. One does not have to be a rocket scientist to work out that those who are suffering are those who live in Mangere and Northcote rather than in Remuera and Takapuna. In fact the New Zealand income survey shows that the average income for Maori is $471 per week compared with $598 for non-Maori—a difference of $127 per week. Maori’s history as the lowest-paid group in the workforce and the problems that result from that poverty. are the reasons why on many many occasions in this House the Maori Party has condemned low rates of pay as a form of economic violence. 
It was with that knowledge that we went into last year’s election with a bid to raise the minimum wage to $12.50 per hour because when we feed the worker we feed the whanau nurture the well-being and safety of children and offer hope for their future. Yet this is not a call from the Maori Party. In a country that likes to pride itself on its growth and its wealth it is to our enduring shame that we can even have an organisation called the Child Poverty Action Group. Yet we do. That group has also supported the call for a rise in the minimum wage in order for our poorest children’s life chances to improve. The key aim of the fast-food workers’ “Supersize my pay!” campaign is to raise the minimum wage to $12 an hour. Unions have been pushing for it for years; so have the Greens. So we are in good company in supporting this bill today. 
There are many workers in forestry construction courier services transport labour hire pamphlet delivery and other such services who may be exploited through unfair contracting. So the changes proposed by Darien Fenton to ensure that contractors must be paid a minimum rate are a positive move for both youth and adult workers. But I have one word of caution for the select committee. We note the results of a major study carried out by Gail Pacheco a senior economics lecturer at the Auckland University of Technology which suggested that Maori and Pasifika will be the ones most adversely affected by a rise in the minimum wage. In her study she noted that Maori and Pasifika made up more than 20 percent of low-income workers and that if the increased minimum wage were approved it would be they who got the sack first if employers were forced to lay off staff. How sad that is but unfortunately how true as well. 
The Maori Party supports this bill because it is part of our campaign against the wages of poverty and the deprivation that poor people suffer. But we caution against any move that may further jeopardise the standing of the workers in  
bro’Town 
. Kia ora tatou. 
PETER BROWN (Deputy Leader—NZ First) 
: 
 Let me be clear from the outset. New Zealand First is not supporting the Minimum Wage and Remuneration Amendment Bill because basically we do not see a need for it. Not one person or contractor has come to us and said he or she needed Parliament’s help to get a fair deal; not one person. The contractors I have spoken to—and I have spoken to a few recently—say: We’re doing OK Peter. We don’t need your help. Don’t come and interfere. We can do it OK.” 
I listened to the member from the Maori Party who has just resumed his seat. I sympathise with him and the case he was espousing. He was talking about employees who are earning a low minimum wage. That is why New Zealand First included in its confidence and supply agreement the proposal to increase the minimum wage to $12 an hour within this term of Government. 
I say to the honourable member Darien Fenton that in her letter she did not make clear the explanation of what she is trying to achieve. With due respect to the member—and I do not want to break confidences—I asked her what the bill was about and she said the select committee could sort that out. New Zealand First is not prepared to sort bills out at the select committee if we do not understand what they are trying to achieve in the first place and if we think they are to the detriment of the country as a whole. In her letter to me she writes at one point: “I note that many jurisdictions throughout the world are seeking ways to extend minimum labour protections to those not in traditional employer-employee relationships.” 
Why did she not give us some examples? Why do we have to research that to see the substance of it? We would have appreciated some examples. I will give the honourable member an example. Someone wants to paint a house and agrees on 10 hours’ work at $20 an hour and the first day is rained out. So in effect it doubles the time and obviously if the employer and employee stick to the contract rate it goes from 10 hours at $20 an hour to 20 hours at $10 an hour. Would that contractor have a claim against the owner who wants the house painted? I ask Mr Copeland whether he thinks the contractor has a claim against the householder who has engaged him to do the 10 hours’ work? 
Gordon Copeland 
: I don’t think it’s practicable. 
PETER BROWN 
: He does not think it is practicable but he is going to vote for it. United Future members are going to vote for this bill to go to the select committee but Gordon Copeland does not think it is practicable and he does not know what the answer is. 
Paula Bennett 
: The select committee will sort it out! 
PETER BROWN 
: The unfortunate thing is that in listening to the Maori Party the Greens no doubt and the Labour Party I heard the bill is likely to go to the select committee that I will be on. The only promise I am prepared to make is that as a conscientious MP I will do my best to help sort it out. If this legislation is going to be the law of the land we have to have sound law of the land. 
Gordon Copeland 
: I’ve got full confidence in you. 
PETER BROWN 
: The honourable member says he has full confidence. I bet he is not there. He does not even intend to be there. Will he put his name up to be on the select committee? No he will not. So he has full confidence in me. I think the member ought to have if he is voting for a job for me and is not prepared to help me out to do it. 
Bob Clarkson 
: Peter just open your mouth and let the wind blow your tongue around. 
PETER BROWN 
: I did not catch that. I imagine it is some witticism. I think Bob Clarkson should say it again because we do not hear him speak terribly often in this House and we want to know the sound of his voice. [ 
Interruption 
] It was good was it? I will read  
Hansard 
 with interest tomorrow. 
People put in contract prices for a number of reasons. Some do it to get a job that might be prestigious. Before I came into this place I was a contractor. I never had to work for the minimum wage but I would put in a price at a lower rate than normal because I wanted to be able to do that particular job. Some people put in prices because they need the work to keep them going and to feed their children and are prepared to take a risk on it. Others put in a price to keep out a competitor over a short period of time. 
If we produce a law that states that on every occasion these guys have to have their wages inflated to the minimum wage when they drop beneath it then I say we are doing a huge disservice to contractors. We might well have to sort out the engagement of contractors but this bill is not going to do that. From New Zealand First’s perspective we are going to vote against it but we will help to sort it out at the select committee. 
SUE BRADFORD (Green) 
: 
 This is a good bill and on behalf of the Green Party I would like to offer my congratulations to Darien Fenton on introducing it to the House. I am very pleased to hear that the Maori Party supports it and very disappointed to hear what Peter Brown has just said as surely as a member of New Zealand First of all the parties and as a gentleman who has talked a lot about the need to support and improve the lot of casual and low-paid workers I think it is a disgrace that he has taken the position he has. 
This bill closes another loophole in the Minimum Wage Act a loophole that sees some workers being grossly exploited and being paid less than the minimum wage provisions of the Act. This bill could be called the “Minimum Wage (Abolition of Employment Status) Discrimination Bill” and as such it is a good companion to my Minimum Wage (Abolition of Age Discrimination) Amendment Bill. Given the concern over recent weeks by a number of parties at the remuneration paid to individuals working on a contract for service on properties owned by a member of this House I would hope vainly I know that this bill would receive unanimous support from all parties to go to the select committee. 
It is anathema that in today’s world young people and those on contracts for service do not receive the full protection of the Minimum Wage Act. Such gross exploitation cannot be allowed to continue. My Minimum Wage (Abolition of Age Discrimination) Amendment Bill will stop this gross exploitation by removing the ability arbitrarily to discriminate on the grounds of age when minimum wages are set. 
This new bill will address the gross exploitation of those workers who work under contracts for service. This includes not only the pamphlet deliverers mentioned in the explanatory note of the bill but also people such as painters builders pizza drivers security officers commission sales people and many others. It must also include homeworkers—a growing but very vulnerable group of mainly women workers who attempt to stretch the family income through taking in work such as clothing manufacture other light manufacturing computer-based work childcare and so on. The exclusion of these people from minimum wage legislation simply on the basis that they are not employees in the legal sense of the term is wrong and simply adds to the growing underclass that exists in this country. We have only to look at the recent  
New Zealand Living Standards 
 report and S 
ocial Report 2006 
 for confirmation that the gap between the well-off and the very poor is actually intensifying at the moment. 
In many cases these people on contracts may even be employees within the meaning of the law but low awareness of employment rights allows unscrupulous employers to convince them that they are contractors rather than employees. This is an increasing problem as more employers seek to escape their employment responsibilities by renaming employees as contractors. This small but growing group of employers is not only grossly exploiting those working for them but also putting better employers who play by the rules out of business by undercutting their prices. 
I would expect employer groups to strongly support this bill to protect their own members. However I was disappointed to see the other day that the Employers and Manufacturers Association (Northern) is unfortunately once again opposing progressive employment legislation—and in fact turning its back on its own members who are law abiding on the whole—and instead siding with the exploitative employment practices of the undercutters and fly-by-nighters. With this amendment to the legislation in place there will be less temptation for workers to be called contractors when they are not or to be paid under the table rather than by proper wages taxed at source. I would think that the parties to my right would actually support that notion. 
This bill will throw more light on the underground economy. It will see the regularisation of employment relations that are very much in the grey area at the moment and we will all benefit by seeing a greater tax take that can fund our health education and social services. 
Before I finish I would just like to note a few concerns. Firstly the proposed new section 4A(2) in clause 7 still provides for age discrimination. The Green Party believes that age discrimination is not acceptable in either contracts of service or contracts for services. Secondly there does not appear to be any amendment to section 5 of the Minimum Wage Act to require an annual review of minimum remuneration for contractors. That might just be a drafting oversight. The real detail will come in the regulations prescribing minimum remuneration for contractors themselves. These will not be easy to draft and will not come under select committee scrutiny prior to their being promulgated. However I hope Darien will give an outline of the proposed regulations to the select committee. 
The Greens will support this bill and expect National especially to be a strong supporter of it. I also expect Darien Fenton and the Labour Party to continue to strongly support my Minimum Wage (Abolition of Age Discrimination) Amendment Bill as I believe these two members’ bills belong together in helping to implement fundamental and much-needed reform of our minimum wage framework. 
PAULA BENNETT (National) 
: 
 I rise on the Minimum Wage and Remuneration Amendment Bill and find just so many problems with it. Having read Darien Fenton’s letter about it as well I find—a little like Peter Brown—that it is just so hard to understand exactly what she is trying to accomplish. I suppose what it fundamentally comes down to for us in the National Party is that it is about freedom—freedom of choice and freedom for people to manage their own work to suit themselves. In many cases that is why people choose to contract. They choose to go under a contract. 
Let us take the example of pamphlet deliveries because that is the one example I have heard Labour use. Under that example we have people who will choose to take their time who will choose to do the job at their own will or whim who will stop and start who will call into houses and who actually like the freedom to be able to do the job without having to be under an hourly rate—or as it would be an hourly contract to someone. So they choose merely to be paid for what they deliver and they are quite happy with that arrangement. I am in agreement with that because I have yet to hear of someone who is unhappy with the arrangement after talking to them and hearing of the freedom they enjoy. 
It will be people such as older people who will find themselves out of a job because employers in that situation will think that the push from the Government is to put people on an hourly rate. So they will put them under an hourly rate but that will not be an ideal situation for many of them and they will choose not to do the job. They enjoy the freedom that comes with the work they can do. 
A classic example was a contractor I was speaking to with a very small business who was contracting to go out and do gardens and things like that. He did not sit down and think about how long it would take him to do the job; he worked out what he felt the job was worth then he put a price to it accordingly. Under this bill it seems to be the case that depending on the time it would take it could actually cost a heck of a lot more for people to get their lawns or gardens done. So how can that be fair for anyone because they will not then get the work? In the case of the person with the small business he enjoys the freedom to work when he wants to and to get the work done in the time he does it. 
Under this bill I am wondering as well how that would possibly work. Would people have to clock in for every 10 minutes they worked and clock out for when they did not then have that recorded? It is talked about that it will be legislated and investigated. Will we have labour investigators going out to look at how long jobs actually take so that we can then decide? It could all be sorted out at the select committee of course. The bill is about regulating the market even more when it is the freedom of the market that works for people. It is as simple as that really. We will be regulating because we do not wish to let those people have a choice. In many cases it really is about choice. 
The other thing concerns the reason why people choose not to go into the contracted hourly rate of an employee. More often than not when people are being paid by the hour they feel as if their time is owned. As such when I am an employee my time is owned for the period of that job and I am obliged to do the job at the pace required by my employer—and at the rate required by the employer. Again that is taking away that choice. 
I have concerns about another issue and let us use the example of someone cleaning carpets. Like the member from United Future I would go out and get different quotes for the job that is to be done but then when that job is actually done I might look at it and think that it has not been done satisfactorily. The carpet cleaner then has to go back into the house and do the job again. So the cleaner has had to do twice the time for what the service had been contracted out for in the beginning because the job had not been done effectively in the first place. So what does that mean? Because the job has taken the contractor twice as long all of a sudden he or she may be outside the minimum hourly range and as a consequence the rate has to be cut. 
It can be the same in the case of pamphlet deliveries if we want to use that example. Occasionally a job is not done properly so the contractor is told to go back and do it again how to do it and everything else. Because contractors are not doing jobs effectively in the designated times they agreed to themselves and because they are having to do jobs twice when they have not been done properly we will have labour inspectors coming along and having a look at that. It is just absolutely ridiculous. I cannot see how it will possibly work and it is for that reason that National will most definitely be voting against it. 
Hon RUTH DYSON (Minister of Labour) 
: 
 What an extraordinary exposé of right-wing pure ideology from that member. It is just extraordinary to steal language words like “freedom” and then put them alongside the right for people to be paid $1 an hour $2 an hour $3 an hour or anything other than the minimum wage of $10.25 and call that freedom. What a disgrace to a civilised society that member is! She should hang her head in shame and never come to this House and repeat that sort of ideological nonsense. It is just a total outrage. 
For people who are the most vulnerable in our society to not be entitled to a minimum wage in a civilised society in New Zealand in 2006 is just a disgrace. That member purports to understand what it is like for people who are in low-paid jobs people who are struggling. That member who brings out her tissues has crocodile tears appearing because she had such a hard road to pave before her grand entry into this House. Then she comes into the House and says that people should have the freedom to work for less than the minimum wage. Well if people want the freedom to be like that member then I think we have a responsibility to save them from that fate. Anybody in New Zealand should be saved from the fate of being like that member; her speech was just a disgrace. 
I want to congratulate Darien Fenton. She has been in this House for less than 12 months and has produced a member’s bill that addresses a very fundamental flaw in our employment relations legislation in that we do not have a minimum wage provision for those who are working under a contract for service. They may be vulnerable they may not be very wise they may decide to cut all sorts of corners in order to get a contract so not only will this bill give those contractors legislative provision under the minimum wage legislation but it will also ensure that we have fair competition when we are looking at the contracts we provide for. 
So the bill seeks to amend the Minimum Wage Act 1983 in order to extend the minimum wage provisions to apply to payments under a contract for service. It is important in a civilised society as New Zealand prides itself on being that we should not have people who are able because they need to undercut another competitor to do a contract for something that may be doing them or their subcontractors no good at all. It is very ironic that Dr Mapp raised the matter of that legislative gap in the House prior to the adjournment and again today. Dr Mapp identified that it was a flaw in employment relations legislation but now with such an extraordinary attitude has come into this House and attacked the very legislation designed to fix the flaw he identified. It is no wonder that member is regarded by employers and employees up and down the country as having no integrity when it comes to matters of honesty openness and genuineness in ensuring that what one says in the House and what one says outside are consistent. I am delighted to support this bill and I look forward to its progress through the House. 
DARREN HUGHES (Junior Whip—Labour) 
: 
 I raise a point of order Madam Speaker. I see that the member for Nelson the Hon Dr Nick Smith has come into the Chamber. I understood very clearly that he was suspended from the House or was asked to withdraw from the House this afternoon for the remainder of the sitting day because of his behaviour so I am very surprised to see him in here right now. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member has been advised that he is out of the House until 10 o’clock so I ask him to leave. Members will please be seated until the member leaves. 
Hon Dr Nick Smith withdrew from the Chamber. 
LINDSAY TISCH (Senior Whip—National) 
: 
 I raise a point of order Madam Speaker. I accept your ruling Madam Assistant Speaker. The member’s bill that we are about to debate is in Dr Nick Smith’s name. I ask that leave be granted for him to make his 10-minute speech. It is his bill; it has been drawn out of the ballot and he has put much time and effort into it. I ask for your reconsideration to enable him to speak for his 10 minutes and following that to leave the House then to return for his 5-minute right of reply. 
The ASSISTANT SPEAKER (Ann Hartley) 
: First another member can move the bill but what I would say to the National Party whip is that the member’s behaviour was grossly disorderly and he was lucky to get away with just having to leave the House. So the request is not granted by me. Does the member wish to put it as leave? 
LINDSAY TISCH (Senior Whip—National) 
: 
 I seek leave for Dr Nick Smith to be allowed to return to the House to take a 10-minute call on the bill in his name and for him to make a 5-minute reply at the end of that debate. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Leave is sought for that matter. Is there any objection? There is. 
Dr Wayne Mapp 
: Point of order— 
The ASSISTANT SPEAKER (Ann Hartley) 
: The matter is dealt with Dr Mapp. 
Dr Wayne Mapp 
: Madam Assistant Speaker I do not often take points of order but I do wish to— 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member will please be seated. I will not tolerate any further discussion on this issue. [ 
Interruption 
] The member assures me that it is a new point of order. 
Dr WAYNE MAPP (National—North Shore) 
: 
 I raise a point of order Madam Speaker. You will be well aware of the practice of Speakers to do reconsiderations in circumstances like this. I have been in the House a number of years and I have certainly seen Speakers do that. I put it to you Madam Assistant Speaker that it would be appropriate to follow the precedents of other Speakers in these kinds of circumstances. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member is lucky to remain here because he is contesting my ruling. I have already ruled on the matter. It is not a precedent; matters are dealt with as they are seen by Speakers. As I said before this member was lucky to get away with just being asked to leave the House. 
Phil Heatley 
: Point of order— 
The ASSISTANT SPEAKER (Ann Hartley) 
: Is the member contesting my ruling? 
Phil Heatley 
: No I have further information Madam Assistant Speaker that I think you need to be privy to. 
The ASSISTANT SPEAKER (Ann Hartley) 
: No I will not countenance any further discussion. 
Phil Heatley 
: But it is not contesting your ruling. 
The ASSISTANT SPEAKER (Ann Hartley) 
: No I will not countenance any further discussion on this issue. It has been decided. 
DARIEN FENTON (Labour) 
: 
 First I thank the various parties—the Maori Party the Greens United Future and of course the Labour Party—for their contributions and their support. I do appreciate very much their understanding that this is a situation of workers’ rights regardless of the legal form the work takes. I also appreciate the parties that are prepared to consider this as a genuine concern not a political football. 
I take the opportunity to say to Dr Mapp that if he wants to talk to me about the financial report of the Service and Food Workers Union I have it here. I am very happy to help him read a balance sheet because I do not think  
Investigate 
 is able to do it and I do not think that he is able to do it either. I am very happy to do that outside of the House if the member would like to do so. 
The starting point of the bill is that this is a dimension of labour regulation that should be extended to all workers who are economically dependent on the sale of their capacity to work. As Peter Brown mentioned I did say that many countries now accept that the traditional concept of an employee no longer provides a satisfactory basis for delineating the scope of labour law. If Mr Brown had asked me I would have been very happy to provide him with the research I have done. I have worked on this issue for many many years going right back to 1998 at the International Labour Organization conference when it looked at the issue around the scope of employment and labour legislation. In Britain for example the concept of a worker corresponding with what we call a dependent contractor is now part of the law. It is an attempt to shift the boundary of labour protection to self-employed workers who are not genuinely in business on their own account. 
There is no worry about those who are doing well but there is a worry about those who are not. I would like to let Dr Mapp know about correspondence I have had recently from somebody in his own electorate who applied for a job where paper runners of all ages were being sought but specifying students at-home parents and retired people. On phoning this person was told that the pay rate for delivering 100 to 125 newspapers is between $3 and $5 for each run and that the workers have to provide their own trundlers etc. Is that acceptable? I do not think so. 
There is widespread agreement that the traditional legal categories which are also current in New Zealand—and there are many many names for them such as employee independent contractor dependent contractor contract for services labour subcontractor labour-only contractor etc.—no longer fit with the economic and social reality of today’s work relations. This is a challenge for all of us and this bill represents a very small step towards dissolving the distinction in rights between employees and the self-employed—or contractors—for the purposes of minimum labour protection. 
I do not understand the National Party’s reluctance to extend rights to the self-employed who are contracting for services. I recall its criticism of this Government for not providing in a hurry paid parental leave to the self-employed. I am sure it would not want to remove accident compensation health and safety rights and social insurance from them either. So what is the difference in providing the very basic protection of minimum remuneration in law? 
 The rationale for this bill is fairness and social justice. Fairness requires that similarly situated individuals be treated equally—that is people who are depending on the sale of their labour should be treated similarly regardless of the form the transaction takes. The social justice argument is that all workers should be protected against harms and risks that are broadly seen as being unacceptable. Minimum wage or remuneration is one of the things our society and all parties have seen as a necessary floor below which people should not be required to provide their labour. There is no more justification for permitting discrimination in terms of minimum wage or remuneration against any worker who provides services personally regardless of the contractual arrangement under which the service is provided than there is for permitting racial or sexual discrimination against any worker. 
The point of this bill is not to facilitate workers who are contractors to reach the very hard goal of proving they are employees; it is to provide for a minimum entitlement of remuneration regardless of their legal status. New Zealanders believe in fairness and justice; they believe that people should be treated equally. That is what this bill is about. 
A party vote was called for on the question  
That the Minimum Wage and Remuneration Amendment Bill be now read a first time. 
Ayes 60 
New Zealand Labour 50; Green Party 6; United Future 3; Progressive 1. 
Noes 55 
New Zealand National 48; New Zealand First 7. 
Bill read a first time. 
DARIEN FENTON (Labour) 
: 
 I move  
That the Minimum Wage and Remuneration Amendment Bill be referred to the Transport and Industrial Relations Committee 
referred to Transport and Industrial Relations Committee 
. 
A party vote was called for on the question  
That the motion be agreed to. 
Ayes 71 
New Zealand Labour 50; New Zealand First 7; Green Party 6; Maori Party 4; United Future 3; Progressive 1. 
Noes 48 
New Zealand National 48. 
Motion agreed to. 
Building (Late Consent is a Free Consent) Amendment Bill 
Procedure 
LINDSAY TISCH (Senior Whip—National) 
: 
 Under Standing Order 71 there is an option to postpone the bill. Looking at Speaker’s ruling 23/1 I move  
That the Building (Late Consent is a Free Consent) Amendment Bill in the name of the Hon Dr Nick Smith be postponed until 6 September being the next members’ day which the Standing Orders and Speakers’ rulings provide for. 
DARREN HUGHES (Junior Whip—Labour) 
: 
 I assume the chief Opposition Whip is doing this on the basis that the member in charge of the bill is not present to move the motion for the first reading. The bill would be deferred until the next members’ sitting day? 
The ASSISTANT SPEAKER (Ann Hartley) 
: That is what he indicated yes. 
LINDSAY TISCH (Senior Whip—National) 
: 
 Yes I confirm that that is the next members’ day. The member is not present and I am moving the motion on his behalf. 
Hon Mark Burton 
: And the member agrees? The member has given his consent? 
LINDSAY TISCH 
: Yes. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member has consented. 
Motion agreed to.  
INQUIRyInquiries 
Complaint About Animal Welfare (Layer Hens) Code of Welfare 2005 
Consideration of Report of Regulations Review Committee 
As no member rose members’ order of the day No. 4 for the consideration of the report of the Regulations Review Committee on the Complaint about Animal Welfare (Layer Hens) Code of Welfare 2005 was discharged. 
The House adjourned at 8.46 p.m.