THURSDAY, 14 MAY 2020
The Speaker took the Chair at 2 p.m.
Karakia.
SUPPLEMENTARY ESTIMATES DOCUMENTS
Hon GRANT ROBERTSON (Minister of Finance): I hereby present the Supplementary Estimates of Appropriations for the Government of New Zealand for the year ending 30 June 2020.
SPEAKER: That paper is published under the authority of the House.





BUDGET DOCUMENTS
Hon GRANT ROBERTSON (Minister of Finance): I hereby present the 2020 Budget Speech, the Wellbeing Budget 2020, including reports on fiscal strategy and on child poverty, and the summary of initiatives, the Budget Economic and Fiscal Update, and the Estimates of Appropriations for the Government of New Zealand for the year ending 30 June 2021.
SPEAKER: Those papers are published under the authority of the House.





APPROPRIATION (2020/21 ESTIMATES) BILL
First Reading
Hon GRANT ROBERTSON (Minister of Finance): I move, That the Appropriation (2020/21 Estimates) Bill be now read a first time. 
Bill read a first time.





BUDGET STATEMENT
Second Reading
Hon GRANT ROBERTSON (Minister of Finance): I move, That the Appropriation (2020/21 Estimates) Bill be now read a second time.
From its very beginning, the coalition Government has committed to putting the wellbeing of current and future generations of New Zealanders at the heart of everything we do. There is no time in New Zealand's recent history where this is more important than today. Budget 2020 is being delivered in the shadow of a one-in-100-year threat to the wellbeing of our people, our communities, and our economy.
The global COVID-19 pandemic has sent shockwaves around the entire world, and we are feeling these deeply here at home. 17 March now seems an age ago, when I announced in this House a $12.1 billion COVID-19 recovery package. At the time, this was one of the largest responses on the planet—some 4 percent of GDP. I said then it was only the beginning of our response, and today we take further steps in enabling New Zealanders, together, to respond, recover, and rebuild.
These are not the words I thought I would use to describe the Budget only a couple of months ago. There are many words and concepts that New Zealanders would have been surprised to hear themselves using in quite the way they are: bubble, physical distancing, PPE, contact tracing, "You're on mute, Damien.", level 4, level 3, and yes—as of today—level 2. Another word is "unprecedented". It is one we have heard and said almost daily. The lives of all New Zealanders have been affected to an extent none of us would have thought possible only a matter of months ago. It is also a word that we have to keep using. This pandemic has not finished; its health and economic stories are still being told. We can be very proud as a country of our health response, and it must go on.
And now, we also have to put a team of five million to work on our economic response. The initiatives we've put in place since 17 March, just two months ago, have formed the first stage of our plan to face COVID-19. Respond—go hard, go early. We were faced with a choice between a public health catastrophe, as has been seen in other countries, or unprecedented and difficult measures. There were no costless decisions in this situation, and nor was there any playbook to go by. I know that our success in controlling the virus has come at a price, with hundreds of thousands of Kiwi workers and employers having to stay home, and jobs and businesses lost. But I stand by our view that the best economic response is a health response. By going hard and early—getting on top of the virus while protecting jobs and businesses—we now have a head start on many countries around the world to get the economy moving again.
I want to thank our coalition partner, New Zealand First, and our confidence and supply partner, the Green Party of Aotearoa New Zealand. This has been a Budget put together in extraordinary circumstances, and your cooperation, commitment, and flexibility has been much appreciated. I also want to place on record my appreciation for the massive effort of hundreds of public servants over the last two months, including in the preparation of this Budget. Many people—including those at Treasury and in our ministerial offices—have worked seven days a week for that whole period of time. Their dedication is a measure of true public service.
The core of Budget 2020 will boost critical public services, fund infrastructure, and provide the unprecedented investment needed for the second and third stages of our plan to face COVID-19: recover and rebuild. Through this Budget, we are establishing the $50 billion COVID-19 response and recovery fund. This fund builds on top of the initial $12.1 billion package and the $12 billion New Zealand Upgrade Programme we announced in January. This is the most significant financial commitment by a New Zealand Government in modern history. The fund does not represent a target for spending but gives us the flexibility to be able to respond as necessary. The fund will be critical in seeing New Zealand through the economic struggle that is coming, and rebuilding our economy for the better over the long term.
Our recovery and rebuild will be based on getting New Zealanders back to work. This Budget is about jobs: keeping people in their jobs wherever we can; supporting businesses and sectors to create new jobs through infrastructure, housing, and more; directly creating jobs that help restore our environment and conservation estate; and training and retraining people for new jobs at a scale we have never seen before. It also begins to rebuild our social infrastructure, acknowledging the toll this crisis has taken on our communities, and on the people and places that hold them together. It is a once in a generation Budget. It is bold because the task we face is monumental. We said at the outset of this crisis that, while we would not be able to save every job or every business, we would do everything in our power to protect people and our economy. Today, we go further and begin to chart a course to a better tomorrow.
Coming into this crisis, New Zealand was fortunate to have a fundamentally strong economy and fiscal position. Prior to the COVID-19 pandemic, real GDP growth in the year to December 2019 was higher than many of our international peers. Unemployment—at 4 percent—was historically low, and wage growth—at 3 percent—was at decade-long highs. New Zealand's fiscal position was also strong. The coalition Government had delivered on its plan to reduce net core Crown debt below 20 percent of GDP and achieve $12.8 billion of operating balance before gains and losses (OBEGAL) surpluses in our first two years in office. These were conscious choices that did not go unchallenged. But this strong fiscal position, built on the work of Bill English and Michael Cullen, now means that we are much better placed than many other countries to use our balance sheet to cushion the blow of COVID-19 on the economy and to protect the wellbeing of New Zealanders. The rainy day has arrived, but we are well prepared.
Many other countries are not starting from the same position of strength that we are. The UK started with net debt above 75 percent; the USA, 90 percent; and Ireland, 40 percent. Many countries are already well over 100 percent as they respond to the virus. The IMF expects a decline in global economic activity not seen in peacetime since the Great Depression of the 1930s, with annual global growth expected to fall to minus 3 percent in 2020. Although we are doing everything in our power to push back on these trends, there is no sugar coating the impact this crisis has had on the Government's books. Treasury's forecasts and alternative scenarios indicate that there will be a sharp fall in economic activity and a substantial rise in unemployment. New Zealand's real GDP growth rate is forecast to decline from 2.8 percent in the year ending June 2019 to minus 4.6 percent in the year ending June 2020, driven by a quarterly decline in GDP of over 20 percent in the June 2020 quarter. Annual average GDP growth is forecast to return to positive from the year ending September 2021 onwards. Unemployment is forecast to increase significantly, rising to 8.3 percent in the year ending June 2020, before peaking at 9.8 percent in September 2020 and then recovering thereafter. 
It is worthy of note that economic forecasting is more of an art than a science at the best of times, but more so than ever now. The full impact of COVID-19 around the world is still being seen. The depth and duration of the pandemic means that the economic outlook is highly uncertain, and forecasts will change as more information comes to light, but what they do clearly show is the scale of the economic challenge that lies ahead. I remain committed to managing our books carefully and responsibly. And, right now, being responsible means investing to support our people, businesses, and communities to get through this and to rebuild. This is the rainy day we have been preparing for—now we must weather the global storm. The scale of this required investment will impact the operating position and net debt. OBEGAL deficits will average 9.3 percent of GDP between 2020 and 2022. Careful economic management will see the deficit reduce to 1.3 percent of GDP by 2024. Net core Crown debt is forecast to be 30.2 percent at the end of this financial year, and to reach 53.6 percent of GDP by the 2023 fiscal year before stabilising. These numbers are far in excess of the range that we had been working to, and the levels we had achieved.
But this is a one-in-100-year event, affecting every country in the world this way. In an international context, our debt will still be among the lowest in the world among developed countries. Our disciplined and balanced approach to managing the economy means that ratings agencies around the world have, in recent weeks, reaffirmed our credit rating and their view that New Zealand is well placed to get through COVID-19. Running operating deficits and allowing net core Crown debt to increase in the short term is necessary. This level of investment in the short term will support the economy recovering to where we can return to a more sustainable fiscal position.
This Budget includes the second ever Budget day report on child poverty. Our goal remains, despite the challenges posed by COVID-19, for New Zealand to be the best place in the world to be a child. Budget 2020 builds on past investments to reduce child poverty, including through the Families Package, the indexation of benefits to wages, and lifts to the minimum wage. It is also supported by our actions on 17 March to lift main benefits by $25 per week and other policies that are supporting the lowest income New Zealanders.
In February this year, the Government Statistician published the first report of progress against the child poverty targets set under the Act. Reporting time frames meant that the impact of the Government's Families Package was only partially shown, but of the nine different poverty measures reported, seven showed decreases from the previous year's baseline rates. The report also indicates that the Government was broadly on track to meet the three-year targets on the two primary measures of low income.
It is still too early to know what the precise impact of COVID-19 will be on rates of child poverty. The loss of jobs and incomes will have knock-on impacts for households trying to pay their rents and meet everyday needs. Fundamentally, what we do know is that investing in our children and their wellbeing will have significant long-term benefits for our economy and broader society long after COVID-19 has passed. This focus remains core to the Government's agenda.
As we move into alert level 2 and the recovery stage, our purpose is to see people back at work, to clear the pathway for communities and sectors most affected by COVID-19, and to lay the groundwork for our rebuild. The COVID-19 response and recovery fund, established through this Budget, will be used to support New Zealanders through each stage of the impact of the virus. It is designed to support not only our immediate response but also to provide support, as necessary, over the longer term to rebuild our economy and society.
We have already committed $13.9 billion of the fund to previously announced initiatives, including funding for the wage subsidy scheme, the essential workers' leave scheme, small to medium sized enterprise support measures, the Business Finance Guarantee Scheme, and additional packages to support the health response, and resources for those in need. Today, we are announcing a further $15.9 billion in funding, focused on key areas that will kick-start the economic recovery, create decent, sustainable jobs, ensure the security of our most vulnerable, and lay the groundwork for us to rebuild a better nation together.
This Government has already provided unprecedented support to cushion the blow of COVID-19 for businesses across New Zealand. As well as the wage subsidy scheme, businesses have been supported through significant changes in the taxation system, low and interest-free loans, together with supportive changes to laws and regulations. This Budget goes further, with a $4 billion business support package to keep people in work and position businesses for recovery and growth.
For many businesses, the struggle in the face of COVID-19 is not over. We know that a number of them are far from trading at normal levels, particularly in the tourism, hospitality, and retail sectors. So today, we are announcing a targeted extension of the successful wage subsidy scheme. The scheme has already seen more than $10.7 billion paid out to support workers and businesses. The extension will focus on businesses who are still doing it tough. It will be available for a further eight-week period for those who have suffered a 50 percent reduction in turnover in the 30 days prior to application compared to last year. It will follow on directly from the end of the 12-week scheme, and is estimated to cost up to $3.2 billion. The extension will provide further stimulus to the economy, keep people in work, and give businesses more time, as we move through alert level 2, to re-establish or re-orientate their operations.
Beyond the wage subsidy scheme, our direct business support package increases support to research and development. We are launching a $150 million short-term temporary loan scheme to incentivise businesses to continue R & D programmes that may be at risk due to COVID-19. The loans will provide one-off finance and will be administered by Callaghan Innovation.
Trade will also play a significant role in kick-starting New Zealand's recovery from COVID-19. We are providing a $216 million boost to New Zealand Trade and Enterprise to expand the scope and intensity of support they provide to export firms. This includes increasing activity for New Zealand firms in priority markets and expanding the digital services available to firms.
COVID-19 has brought home the increasing importance of e-commerce for our small businesses. We are setting aside $10 million in funding to support small businesses to improve their e-commerce offerings, and incentives and grants to encourage e-commerce adoption. We will also provide support for business advice, the e-invoicing project, Business Connect, and the Better For Business programme.
Investment in new infrastructure projects will help support the long-term economic recovery from COVID-19. It will not only grow jobs but it will also seek to address the infrastructure deficit that has held New Zealand's productivity back for too long. We will build the infrastructure we need to unclog our cities, to connect our towns, and to support sustainable development. We will make sure that this is the infrastructure needed for a 21st century New Zealand that, among other things, supports meeting our climate change goals.
We had already made a significant start on this with our $12 billion New Zealand Upgrade Programme, announced in January. In this Budget we are establishing an initial $3 billion contingency for additional infrastructure investment. Cabinet will make the final decisions on which projects should be funded from this contingency in the coming weeks and months. This will include projects that are identified through the Infrastructure Reference Group, as well as bids from individual departments and agencies.
We will have a particular focus on regional infrastructure projects identified through the Provincial Growth Fund, and on projects that advance other goals of the Government. We look forward to increased partnerships with local government and the private sector to advance this programme of work. I fully expect that we will fund further infrastructure projects beyond this initial allocation as we move on with our rebuild, including in areas such as our three waters programme. The policies we have introduced as part of the COVID-19 response, such as reform of the Resource Management Act, will be a significant support in this regard.
Every New Zealander deserves a warm, dry home, but a decade of under-investment has resulted in New Zealanders having to put up with a housing shortage, and too many of those homes that are available are of poor quality. We've seen this manifest in unaffordable house prices, high rents, and homelessness that no New Zealander of any political persuasion can be comfortable with.
Not only is housing one of our greatest areas of need, it is also a job-rich area. We have already seen, through our construction accord, the possibilities that exist to train and build a workforce to drive forward our goals on housing. Today's housing package creates 8,000 additional public or transitional housing places over the next four to five years. This will be financed by $5 billion of building through the Kāinga Ora borrowing programme and investment in community and transitional housing providers.
We are also providing $670 million of support and services to tenants. This will improve affordability by increasing the supply of houses, while also providing a shot in the arm to the residential construction sector as we emerge from the crisis. It will also take us further down the path of ending homelessness. Further support for housing development and construction, including in the private residential market, will be a critical element of our recovery from COVID-19, and it is my intention that this will be the subject of further investment in the next phases of the fund.
Our rebuild from COVID-19 provides an opportunity to address some of the longstanding sustainability and environmental challenges facing New Zealand. Our $1 billion environmental jobs package announced today will create thousands of jobs that will at the same time support habitat protection, pest control, and biodiversity on our public lands. This includes a $433 million investment in regional environment projects. These will support our economic and environmental recovery in partnership with local government and farmers. It will include restoring wetlands, stabilising river banks, and removing sediment. There will be projects and jobs created all across New Zealand, including in the Kaipara catchment.
A $315 million package of pest eradication and pest control work, including advancing Predator Free New Zealand, is established in this Budget. This also includes work to get under control populations of wallabies and to help control wilding pines. We are also establishing a $200 million jobs for nature fund to support job creation within the Department Of Conservation estate, including through upgrading tracks, huts, and other facilities. These are practical initiatives: creating jobs, while protecting and enhancing our environment—a perfect ingredient for recovery from COVID-19.
As New Zealanders find themselves out of work, or entering the labour market for the first time, it is vital that there is strong support for them to get the skills and knowledge they need for work. For businesses they also need support to keep and take on apprentices. In the past, investment has not been made up front, seeing people drop out of the labour market, so that when the time comes and businesses have recovered there is not the workforce available with the required skills. We will not let that happen again. This Budget is funding a $1.6 billion trades and apprentices package. It will provide opportunity for New Zealanders of all ages to receive trades training. This will include financial support for businesses to retain their apprentices; free apprenticeships and training in targeted, critical industries; and funding increased enrolments in tertiary education and training. There is a specific $50 million fund for Māori apprentices and trades training. 
We recognise the importance of the partnership with business and workers in making our training system work. The package also includes the establishment funding for Workforce Development Councils and Regional Skills Leadership Groups to assist with coordination. The Ministry of Social Development is being supported to expand its employment services and core provision as well.
We are also injecting a further $121 million into He Poutama Rangatahi. This scheme provides funding to community-driven programmes to resolve barriers to employment and training. They have a proven track record in engaging young people who are at risk of falling out of work and developing them as people as well. This boost will accelerate this programme's establishment into urban areas that have the greatest number of young people not in employment, education, or training, such as west and South Auckland, Hamilton, Porirua, and Christchurch East.
If there was one decision in the wake of the global financial crisis that symbolised the failure to understand the role of education and training in the recovery from a downturn, it was the decision to cancel funding for adult and community education, including night classes. This Government will not allow that mistake to be made again. The Budget includes a $16 million boost to adult and community education to restore that funding and help providers to meet the increased needs for training and upskilling in the wake of COVID-19. This Government is absolutely committed to the place and role of education in supporting our recovery and rebuild.
We also understand that the COVID-19 crisis has put pressure on students, many of whom have lost income as a result of losing part-time work. We are establishing a $20 million hardship fund for students in this Budget, and in further responses we will continue to work on other ways we can support students through this difficult time.
Over and above the wider support that we are providing to businesses to keep people employed and support the growth of new jobs, we have a range of targeted support packages aimed at sectors particularly impacted by COVID-19. One of the industries most directly impacted by COVID-19 has been tourism. The shutting down of our borders has been a critical element in our success in controlling COVID-19. But quite clearly that has turned off the tap of the millions of visitors who have supported our tourism industry. Border restrictions are going to be with us for some time, so we need to work with the businesses and tourism centres to re-imagine and transition the industry. The extension to the wage subsidy scheme announced today will provide further support for tourism businesses and jobs as domestic tourism begins again.
The Budget today makes the first contribution from the Government to the tourism sector recovery plan. This $400 million funding injection will support the first stages of an action plan agreed with the industry. This will include a transitions programme to support businesses to plan for the next steps, a fund to ensure key tourism assets survive, a domestic tourism marketing campaign, and a public-private taskforce to shape the future of the industry.
This Budget also recognises the significant impact of COVID-19 on our Māori community, particularly in terms of unemployment, where Māori are already overrepresented. Our Māori COVID-19 recovery package totals $485 million and includes a range of measures to support whānau through the recovery period. This is in addition to other significant investments in Budget 2020 for Māori initiatives. The package includes a $137 million boost to Whānau Ora to ensure providers can continue to provide timely and flexible support to whānau facing the health and socio-economic impacts of COVID-19. I want to make a special acknowledgement to those Whānau Ora providers and to other iwi groups who have provided hundreds of thousands of care packages to whānau during this period. Ngā mihi ki te aroha.
The package also establishes funding for a Māori and iwi housing and innovation fund, Te Maihi o Te Whare Māori, to create opportunities for building housing for whānau and the jobs that go with it. More than $20 million has been allocated to a cadetship programme to support re-skilling and career development opportunities. Further initiatives to support Māori education are supported in order to ensure that the effects of COVID-19 do not take away from the earlier investments made by the Government. This includes programmes to sustain kōhanga reo and revitalising Te Reo Māori.
Likewise, our $195 million Pacific recovery package is comprised of a range of initiatives to support Pacific communities who have been affected by COVID-19, including a major focus on programmes to lift skills and support employment. One example is the extension of the Tupu Aotearoa programme across New Zealand. This helps Pacific young people to find employment, complete further training, or undertake study. The package also includes a Pasifika culture and heritage fund, support for housing, business and community development, education, and training.
There are also sector recovery packages for the arts and for sports. These are both areas that have been devastated by COVID-19. Funding sources have dried up and events have been cancelled. They are both sectors that have increasingly offered employment opportunities and contributed to our economy. We know that they are very much part of our social infrastructure. They make our communities strong. The details of these packages will be announced in the coming days.
One very particular part of the community and sporting sector gets a long sought after boost in this Budget. Our water safety sector has long relied on donations for much of its work. In an increasingly tough environment to raise that money, the likes of Surf Live Saving New Zealand and the Coastguard will now have funding security with $62 million allocated over four years for their critical work. Further sector packages, including for the media sector are being developed over the coming months.
It is critical that we support our communities and, especially, vulnerable people to respond to and recover from COVID-19. On 17 March we provided a $2.8 billion package that increased main benefits across the board by $25 per week and doubled the winter energy payment for 2020. We have continued to provide emergency support via Civil Defence throughout this period, and provided $100 million of support to house the homeless.
In this Budget we are investing in financial assistance for caregivers. This will increase the current rates of the foster care allowance, orphans benefit and unsupported child's benefit by $25 per week per child to meet the needs of children and their caregivers. It also provides further support that the Minister for Children will outline in the coming days.
Food security will be critical throughout the recovery period, with too many individuals and families impacted by COVID-19 struggling to afford food. No New Zealander should go hungry because they can't afford it. That's why we are expanding the free and healthy school lunch programme to 200,000 students from term 4. The $217 million expansion will target students in schools with the highest disadvantage and is expected to create 2,400 jobs in the community. We are also providing $32 million to increase support for food banks, food rescue, and other community food services to leverage surplus donated food from producers, manufacturers, and suppliers that would otherwise go to landfill. We are also establishing a $36 million fund to support community groups to respond directly to COVID-19 and its impact, with a particular focus on those who are from Māori, Pacific, refugee, and migrant communities. 
As I've said, today's announcements are part of a rolling maul of Government support throughout the COVID-19 response and recovery. Our economic response to COVID-19 will happen every day, not just Budget day. We will continue to work with New Zealanders to shape that response. 
As we faced up to COVID-19 and deployed such significant support in such a short space of time, we had to take another look at our plans as a Government. As in businesses all around New Zealand, important work has had to be slowed or postponed, and resources have had to be reprioritised in light of the fight against COVID-19. The Budget is no exception. The new spending packages planned on our five priorities that were announced in the Budget Policy Statement have been reassessed. We may revisit them in future, but the focus for Budget 2020 has now very quickly become providing the strong public services we need and taking our next steps to recover and rebuild. New Zealand's ability to respond rapidly and effectively to this crisis has highlighted the importance of investing in and maintaining effective core Government services. I will briefly run through the main elements of the core package to maintain and enhance these services.
Investment in the health sector has never been more critical. Budget 2020 invests extensively in areas that we know will make a difference to the wellbeing of New Zealanders. The total investment made through our core health package is $5.6 billion in services and $755 million in capital investment. This spend includes $3.9 billion for district health boards. This represents the largest ever annual investment. This will provide much needed funding for our hospitals and other services so that they can continue to provide for New Zealand's growing and changing population. 
The Budget also provides funding for more medicines through a $160 million increase to the combined pharmaceutical budget managed by Pharmac. This critical investment takes Pharmac's medicines budget to a record $1.045 billion for 2020-21. That's an increase of 20 percent since 2017-18. 
We are also helping disabled New Zealanders to live good lives, with a further $832.5 million for disability support services. This initiative provides security of funding for services to people with long-term physical, intellectual, or sensory impairment. 
In addition to this package, and to the $500 million allocated as our initial boost to deal with COVID-19, we are announcing today further supports to parts of the sector particularly affected, including $37 million to sustain laboratory testing capacity and additional support for ambulance, aged care, disability, and hospice services. I expect that we will provide further support to our health sector in the coming months. 
Budget 2020 provides a funding boost to both governmental and non-governmental social services, to support employment, housing, and wellbeing. Our $203 million family violence services package represents the largest funding boost for family violence service providers in over a decade, so that they can recruit and develop highly capable staff and respond to the demand they are facing. It builds on the $320 million in funding provided through Budget 2019, to be the two largest increases in family violence prevention funding on record.
The Budget invests nearly $1 billion to support the core provision of education services. This will provide substantial support to students across all levels of education, while also targeting investment in areas that we know will benefit students who need it the most. The education package makes a significant investment in our early childhood sector. The sector has been placed under particular strain in recent years, and this has been exacerbated by COVID-19. The Budget includes cost adjustments for early childhood education subsidies and a pay boost for early childhood teachers. The Government will make further announcements on support for this sector in the near future. The school property investment package will invest $115.1 million to help expand, maintain, and enhance our schools. 
New Zealand's primary industries play a critical role in growing our economy. As we move further into the post-COVID-19 economic recovery, our primary sector is more important than ever. The core package invests nearly $500 million in initiatives that will ensure our primary industries are supported and sustainable now and into the future. Funding in the package will support primary industries with their existing operations and preventing or mitigating the impacts of biosecurity threats and enabling implementation of climate change and emissions trading scheme reforms.
Budget 2020 provides a boost in investment to support a safe and equitable justice sector. We're building community safety through investment in new technology, court buildings, and Corrections. A key initiative in this package is the Next Generation Critical Communications programme, which will invest in bringing state of the art communications capabilities to police, fire, and ambulance, supporting healthier, safer, and more connected communities. This will see our emergency services finally able to communicate with the public and with one another all over New Zealand in a safe and reliable manner. The package also provides funding to enable continued access to justice services, such as funding for legal aid, community law centres, and the Canterbury Earthquakes Insurance Tribunal. Additionally, it provides funding for the newly established Criminal Cases Review Commission.
Budget 2020 reaffirms this Government's commitment to supporting arts and culture in New Zealand, ensuring that funding is available to preserve our nation's taonga, promote creativity, and celebrate our diversity and history. The package provides support for the local film industry and culturally significant historical collections, as well as ensuring the accessibility of public media platforms to diverse audiences, such as New Zealanders with hearing impairments and those from our Pacific communities. It also includes the significant Preserving the Nations Memory project that will build new facilities for our public records. 
The Budget 2020 package includes funding for critical pressures in the defence sector. This funding investment in areas such as ICT and Defence estate infrastructure and the replacement of the hard-working Defence Force's C-130H Hercules fleet. The package also includes an additional $55.6 million for New Zealand to provide further Official Development Assistance (ODA) particularly to our Pacific neighbours during a time of great need. It will bring New Zealand's overall ODA spending to almost 0.3 percent of forecasted gross national income for the first time in 40 years.
Budget 2020 builds on investment made through the New Zealand Upgrade Programme and includes more than $1 billion to improve transport across the country. This investment will enhance the resilience and reliability of national rail and ferry networks and, over time, contribute to efforts to reduce our carbon footprint through decreasing emissions. I particularly want to highlight in this package the $400 million capital investment to help replace the Interislander ferries. New ferries will provide a more secure and resilient link between the North and South Islands.
The significant investments we are making in public services will be of the utmost importance with the country now moving out of our initial response stage and into our recovery stage. These investments complement and support our targeted COVID-19 response, recovery, and rebuilding measures.
Today's Budget represents the next steps in our recovery and rebuild. The world is still learning what the impacts of COVID-19 will be. We owe it to New Zealanders to work carefully through our next steps, recognising that the decisions we are making will define the lives and livelihoods of many people for years to come. The weight of those decisions comes with a spirit of optimism in what New Zealand can be. The glimmer of silver lining on this darkest of clouds comes from the knowledge that we have the opportunity to build back better. There are few times in your life when you get to hit the reset button. It is a privilege that many countries do not have right now as they still struggle to get the virus under control, and it is an opportunity we will not squander. 
Our rebuild must be one that takes the very best of who we are and uses it to take on the issues and challenges in front of us. Some of them are old: inequality, low productivity, polluted rivers. Some of them are newer: the transition to a low-carbon economy, adjusting to the rapidly changing world of work, maintaining social cohesion. All of them are in front of us in stark relief. 
We can draw on the lessons of the past as to how to deal with them. The answers lie in the great traditions of the first Labour Government, who rebuilt New Zealand after the Great Depression. It was a time when they understood a genuine partnership between Government and the people; that each and every person in this country deserves the right to take up the chances afforded by being lucky enough to live in, as my predecessor Peter Fraser called it, this green and pleasant land. They built houses, rail, and roads, they created the welfare State and a strong public health system, and they backed shopkeepers and manufacturers. We are taking those principles into the modern era.
We can also draw on lessons of the past as to what not to do in response to a major economic shock. In this case, I can draw on the experiences of my own life. As the economic carnage of the 1980s and 1990s wreaked havoc in our communities, I saw that up close. It was based on a tired set of ideas that the market would save us, that if the Government sat on the sidelines all would be well. Well, it didn't work out that way and lives and livelihoods were lost. That will not happen; not on the watch of this Government.
We know that we must work in partnership with iwi, business, unions, community groups, and every one of the team of five million, to make sure we all not only get through this but that we thrive on the other side. That means continuing to be bold, as we have been in the last two months. We're not always all going to agree on the path, but it must be one that gives each and every New Zealander a stake in our future: decent, well-paid work that provides respect and dignity; looking after our most vulnerable; and where we make good on our promise to future generations that we will take on climate change and leave them a legacy to build from.
This Budget takes the responsible path of investing to respond, recover, and rebuild. It takes us down a path where we will face choices as to how we begin to repay some of our debt. There will be difficult choices then, as there are difficult choices today. But I promise you this: this Government will never put the burden of those choices on those who can least afford it. We will not cut the services that are their lifelines. We will not preach austerity, but then line our pockets with tax cuts. No, we will rebuild this country with hard work, innovation, creativity, compassion, and courage. We will grow our economy sustainably to pay back our debt, we will fairly share that burden, and, above all, we will do it together.
There are still tough times ahead. But we have made it this far in fighting COVID-19 by drawing on every bit of who we are as New Zealanders: kind but tough, fair but forthright, and single-minded but united in action. It is just the end of the beginning; the next chapters are ours to write. Kia māia, kia atawhai, kia kaha—be bold, be kind, be strong. He waka eke noa—we are all in this together.





BUDGET DEBATE
Hon SIMON BRIDGES (Leader of the Opposition): Nothing in recent history has brought about such global disruption as the COVID-19 pandemic. Kiwis have sacrificed much through the restrictions of lockdown, but we can all be proud that the collective efforts of everyone have so far worked well. 
Today is not just about the Budget but about the direction of New Zealand more generally, because the decisions we make now are generation-defining ones that will affect the next decade and beyond. This is about whether we have a society where people have jobs and growth, or are saddled with uncertainty, debt, and taxes. Tens of thousands of Kiwis have already lost their jobs and similarly large numbers of business people have had to close their doors for good. These New Zealanders have, through no fault of their own, paid a huge sacrifice because of COVID-19. You've lost your livelihoods and the nest eggs you've worked so hard to build up. National stands with you. 
It's important we take a moment to reflect on the last eight weeks. A lot of our response has gone incredibly well. New Zealanders have self-isolated and social-distanced, and sacrificed. We have flattened the curve. But just having a low number of COVID-19 cases isn't success when we have tens of thousands of people out of work, and more coming. Figures from the Reserve Bank yesterday estimated that there will be 150,000 job losses over the next six months, and this Budget puts it at 160,000. 
First, credit where credit is due: this Government's speed at getting the wage subsidy scheme up and running reduced early economic calamity. Our lockdown, however, has proved excessively hard. As I've said, workers and businesses have watched in horror as week after week of lockdown has washed away the foundations of their businesses that they have spent years or decades building. One thousand people a day are joining the dole queue since lockdown began, and those numbers are increasing. That is 1,000 people a day who are losing their livelihoods, 1,000 people a day who face a very uncertain future, and 1,000 people a day who don't know how they're going to pay their bills. 
Having gone hard and early on lockdown, we've gone soft and slow on the economy. While lockdown was justified, we should have opened up the economy sooner to get New Zealand working again. Having flattened the curve, we must not flatten the economy. We must unlock New Zealand and get New Zealand working again. 
Today's about the future, not the past. We need to lighten the lockdown to save jobs by getting cash to small businesses in need in the very short term. Even now, lockdown of a kind continues. Yes, at level 2 more workplaces can open, but there are many rules, and many workers and business people are still going backwards. I say, Prime Minister, get Kiwis back to work unless there's an overwhelming reason not to. Put more trust in everyday New Zealanders. 
We recognise we're in the deepest economic recession in our lives. That involves us ensuring we don't make the economic disaster worse than it needs to be. We must not spend more than we need to in poorly prioritised areas. After health and after education, we need only ask one question with our taxpayers' money: does it save jobs and create growth? Big spending in the Budget should be focused on saving jobs, because we understand the suffering from a thousand people a day going on the dole queue and businesses shutting up in record numbers. It's much easier to keep someone in a job than it is to later find them a job from the dole queue. 
There's much that's good in this Budget: the business support, and the extension in a targeted way of the wage subsidy. But I note the priorities where $400 million is in tourism for 400,000 jobs, and yet rail is $1.2 billion for fewer than 4,000 jobs. I'm disappointed because I don't see a plan for jobs and growth. I see pet projects, whether rail or pest eradication, and they may have worth, but, added up, they mean colossal debt and they don't create sustainable jobs for workers from small to large businesses. 
There's an additional $140 billion in debt, taking us to $200 billion in debt in this country. I note Bill English, I think, didn't really ever have over an extra $1 billion in a Budget in his time as Minister of Finance. That's an extra $140 billion in debt, taking us to 54 percent debt to our gross domestic product, or what we earn as a country—54 percent—when private debt in this country, we know, is high. That is $80,000 a household—a second mortgage for New Zealanders that this Budget brings in—and $100 billion in deficits over four years, and we know that part of that $140 billion is a $50 billion COVID-19 response and recovery fund. Sadly, a $50 billion slush fund is not a plan for jobs and growth. Spending money is the easy part, but Grant Robertson doesn't even today know how he will spend it all. It's not a plan. Much isn't allocated, leaving over $20 billion to spray prior to election 2020. 
We run the risk of turning a deep economic recession from a $50 billion one to an over $140 billion one in debt. Through poorly prioritised spending, the Government risks making this economic disaster worse than it needed to be. We've seen it over this term with $3 billion on a provincial growth fund which has created more jobs in Wellington than it has in Wairoa, or hundreds of millions on fees-free, which has led to fewer students at our universities. That unavoidably means much more debt to everyday New Zealanders. 
As I've said, at $140 billion, that's $80,000 for every household around our country, and it all needs to be paid back. That, in turn, inevitably means far fewer choices, more taxes, and less money in Kiwis' pockets. That is why we need discipline from the Government. Weeks ago, the Prime Minister said that we had stopped a wave of devastation, and thanks to the sacrifice of New Zealanders, we have flattened the curve. But, today, we see a tsunami of debt about to wash over us—the greatest burden of debt in our country's history by a long way. 
Last week, the Prime Minister wouldn't rule out increasing income taxes or introducing new taxes. We know Labour is instinctively in favour of increasing taxes, and now they have their chance to do so for Kiwi businesses and everyday New Zealanders. Vote Labour and—you mark my words—this time next year, the kindness will be gone, and because of wasteful spending, you'll get more taxes and less money in your pocket. Higher taxes are the last thing New Zealanders need right now, but they are a certainty under a Labour-led Government. What we need now is an economic recovery strategy that gets New Zealanders working again, rather than wayward spending, debt, and taxes. Every day that New Zealand isn't working again, the debt and the taxes increase. Even now, at level 2, where more workplaces can open, too many restrictions remain. There are too many bureaucrats angsting over every aspect of our lives and, along with politicians, making calls on our behalf. You need to trust everyday New Zealanders, Prime Minister.
It's relatively easy to go into lockdown. New Zealanders made the sacrifice. It's much harder to lead an economy back into recovery, but the best thing you can do is make the way back as simple as possible. That takes an understanding of business and the private sector, and a clear economic plan for jobs and for growth. Unfortunately, we know this Government has a poor record of delivering. I worry about the Government's ability to get us out of this crisis. I worry about their ability to come up with an economic plan and to execute it. Remember, this is the same Government that failed to deliver KiwiBuild, the same Government that failed to deliver light rail down Dominion Road, the same Government that has failed to build any new roads—in fact, has cancelled most of them. This year, it announced a lot, and in this Budget we see a lot of announcements, and it will continue to make those announcements, but nothing's happening. It's one thing to have a Labour Government in the good times, but not in a deep recession. We must not let mismanagement, missteps, and missed opportunities continue.
National has the team with the track record of managing New Zealand through times of economic crisis, whether the global financial crisis or earthquakes. We won't keep on talking with working groups and committees and reports; we will trust everyday New Zealanders and competently, pragmatically implement our plan. We've got the competence and the track record to do what we say we will. National will deliver on its promises. It was National that invested in Kiwis getting ultra-fast broadband, which has made the past couple of months more bearable and productive. It was National that started and had a plan to continue the roads of national significance. It was National that built the Waterview Tunnel and gave the green light to the City Rail Link in Auckland. It was National that increased investment in R & D and science during its nine years to help accelerate innovation. I was deeply involved in all of those actions, as were so many of my colleagues here. New Zealanders want a Government that can deliver, and I would back National's Paul Goldsmith over Grant Robertson, Judith Collins over Phil Twyford, Todd McClay over Kelvin Davis, Michael Woodhouse over David Clark, Louise Upston over Carmel Sepuloni, plus the rest of my team over any of Labour's team any day of the week.
New Zealanders know that National will get the job done and get New Zealand working again. A National Budget would include a five-point plan back to progress for our country. First, lighten the lockdown: get Kiwis back to work unless there's an overwhelming reason not to. Second, save jobs by getting cash to small businesses most in need. Last week, we announced that we would introduce an $8 billion GST cashback scheme for businesses. That would allow them to claim up to $100,000 GST refunds and up to $250,000 in low-interest loans. That would do much more—much more—than the Government's less targeted and less generous loan scheme, or anything announced in the Budget today to save businesses and jobs in the private sector, where we know it's small businesses through large businesses that actually are the engine room of growth and a plan for prosperity for our country. We also announced we would allow businesses to instantly deduct investments up to $150,000. That would incentivise investment, which would help to stimulate the economy as we recover from this crisis.
Third, we need a bit of common sense and pragmatism around the rules for the one- or two-metre world. It's one thing to allow bars and cafes to reopen, but if the rules mean that you'd just lose money, what's the point? Fourth—and I'm serious about this—we would unlock private sector investment, which is the key for growth and innovation. We won't rely on Wellington committees to reinvent the economy; we'll trust Kiwis to work out how to get back on their feet. We'll keep taxes low. We won't regulate firms to death or keep changing the rules; we'll back them to succeed. And fifth, we'll use the Government's balance sheet to invest in large, high-quality infrastructure, and we'll actually get it done, like National did with ultra-fast broadband and upgrading our skills, turbo-charging the innovation sector and improving the quality of public services such as health.
We need a Budget that backs New Zealanders. I urge the Government to implement our proposals. They will save businesses and jobs and inject the massive stimulus required into the economy. Instead, when New Zealanders look at today's Budget, they'll see some of the bleakest economic forecasts this country has seen in living memory, widespread unemployment, growing debt, a decade of deficits. It's easy to get lost in all of the big numbers today—the four-year projections of spending, the extra billions in debt, the debt-to-GDP ratio. We forget that each of those numbers—all of the numbers, in fact—represent a bigger challenge: the burden we place on New Zealanders and the responsibility we have to them. We forget that a decade of deficits and debt means fewer choices for our kids down the road. The obligation we as parliamentarians have is to make sure the next generation is better off than we are, that they have more choices, more opportunities, more ability to succeed in the world because we back them, not burden them with debt.
I want my two-year-old daughter Jemima in a couple of decades to buy her first home without having to pay higher taxes. I want the young apprentice from Timaru who emailed me and who wants to set up his own business to do so without having to pay higher taxes and be crippled by that tax. I want all New Zealanders to have the future they want. That means a Government with a plan that doesn't just accept that debt and deficits are our future. That means a Government with the vision and the determination to get New Zealand working again, and that means we need a plan for growth, we need a plan for saving jobs, and we need a plan for keeping debt low so future generations are not saddled with more debt.
We are yet to see a comprehensive plan from this Government. As I said before, it's easy to spend the money, but there's no plan here. We needed to see in this Budget, specific solutions to save businesses and jobs, the growth engine of our country, and a plan on how this Government will responsibly manage that very same economy. We need to put trust in Kiwis to unleash their creativity and their ingenuity. Let Kiwis unleash their potential and plans. Let's back and trust everyday New Zealanders to succeed. Let's unlock New Zealand and get New Zealand working again.





Rt Hon JACINDA ARDERN (Prime Minister): Business as usual in this place would dictate that today, Budget day, is the day that the Minister of Finance comes down to this House and delivers the Government's plan for the next year ahead, and, in fact, the plan for the next three. Business as usual would then have the Opposition stand and give a speech opposing that Budget, including initiatives and funding that has the potential to get our economy growing as early as next year. Business as usual would have everyone in this House retrench into their old patterns that the public know so well but, if we're all being honest, probably have very little time for. Today, I'm afraid, the Leader of the Opposition has assumed it's business as usual, but nothing—and I mean nothing—about this time in our history is usual, and so neither should our response be.
We have been a Government that, with the support and efforts of New Zealanders, took us through an enormous health challenge, and we will take the same approach to the recovery of our economy. I see that Mr Bridges did not move a motion of no confidence in this Budget, and I take that as an assumption that the Opposition will vote for this Budget today. I hope so, because this is a period in our history that is a global crisis, and to see this Budget for what it is: a response to the rainy day we have planned for. Now is the time to come together as politicians to say that a rainy day demands of us that we shelter and protect New Zealand to weather the storm. Rather than argue about who gets to hold the umbrella, I hope the Opposition steps away from business as usual and does vote for a Budget that delivers jobs.
A mere six months ago, nobody would have imagined a world that is in the grips of a global COVID-19 pandemic, let alone one that would wreak havoc across health systems and the global economy. I still vividly remember at the beginning of the year reading about the first lockdowns overseas and thinking how remarkable it was to ask humans to stay in one place for such a long period of time; it just seemed unfathomable. And yet here we are, having shut our borders and moved into lockdown and collectively built a wall of defence to a virus that was closing in on the world. There are few things now that I think I will ever consider to be outside the bounds of possibility any more.
Perhaps that is the same perspective we now need as we start our recovery. We have to be focused. We have to be decisive. We have to go into this period knowing that it will be tough but that there is hope and there is possibility. In short, I give my commitment to New Zealanders that they will see us, this Government, apply the same unrelenting focus we have had on our health response to COVID-19 to our economic response, and that work has already started. From the very beginning, we have said that jobs were our focus, and they are. That is why in March we announced a wage subsidy scheme designed to keep people connected to work and to certainty and the dignity that comes with work. That programme has supported roughly 1.6 million New Zealanders to date and has meant that we have thus far avoided the spike in unemployment other countries have experienced while our country was in lockdown and our businesses were unable to open. It helped get many workers and businesses through the toughest weeks so that they now have the chance to reopen and move to recovery.
But we must keep going. The times ahead will be tough. Global predictions are dire. Unemployment will rise, and growth will slow dramatically. We know as a trading nation that will have an impact, and it will be significant and it will be painful. We have never sugar coated what the future will look like, but nor will we pretend that there is nothing we can do about it. Governments have choices, just as we did when we faced COVID-19, and those choices are between sitting back and hoping or sitting up and taking action. We have chosen to act.
Today, we start by extending the wage subsidy. Now, it won't be the same as the first time round, as we look to make it more targeted. We know that there are businesses who are opening up again, but we also know that there are some who cannot just yet, while others will take more time to recover. It serves no one if in the meantime, while businesses are opening back up, they lay off staff unnecessarily. I know how important this is. I've received countless emails from people describing what a difference the wage subsidy has meant to them. In almost all of them, they talk about their staff being their family and how important retaining and looking after them has been. So today we are extending the wage subsidy for another eight weeks, with a focus on providing support to businesses who have been particularly affected by COVID-19. This will mean businesses and sectors like tourism and other small businesses across the country will be supported, and it will ease the recovery for thousands. Like the first round of the wage subsidy saved jobs, this targeted extension will save jobs too. That's why it's in such an important part of this jobs Budget. We believe it's the best thing we can do at this phase of our recovery to help businesses who are getting back on their feet and to support their staff.
But our response must go beyond supporting those still in work. This isn't enough. Too many people have already lost their jobs, and we need to support their path back to employment. For them, we must be swift, we must be practical, but we also owe it to ourselves to take this opportunity to solve the problems of both today and the problems of yesterday as we go. If I'd asked you before COVID-19 what it is we must address as a nation, what are our current challenges, I imagine that many people would write a very similar list. We have long faced a housing crisis. Our environment has been suffering. Inequality and child poverty have all been issues that we have had to tackle. In three years' time, I want to look back and say that COVID-19 was not the point those issues got worse but the chance we had to make them better. We can emerge from this crisis stronger than we were before. That's why we are focused on jobs, but also jobs that solve each of these entrenched problems.
So let's look at how. We have had a skills deficit, and now, on top of that, we have more people who need the chance to train or retrain. That's why this Budget will target vocational training and apprenticeships we need most and make them free. I don't just mean school leavers; I mean everyone. It will mean more people training in building and construction, in agriculture, in manufacturing, community health, counselling, and care work. This will help those who have lost their jobs retrain and others to train on the job. While many have lost work, there are others who have labour shortages. Even through COVID-19, people have wanted to buy our high-quality food and fibre, and that's why in this Budget we'll be looking to partner and support 10,000 New Zealanders into the primary sector and the jobs that they need filled now. For our young people, those who so often carry the brunt of crises like this, we will fund 1,000 more places in trades academy; expand He Poutama Rangatahi to support young people into work in west and South Auckland, Hamilton, Porirua, and east Christchurch; and build group training schemes that support Māori apprenticeships. All in all, this is a $1.6 billion investment into New Zealand's future and into rebuilding apprenticeships, into closing our skills gap.
That will be so important because of our next challenge: housing. Our response to COVID, on the face of it, had a very simple premise early on: stay home, save lives. But that simple, simple requirement forced us all as a country to ask a question: what if you don't have a home? The answer was simple: we will find you one. Through hard work and huge collaboration between Government, local government, iwi, and the community sector, that is exactly what happened. In the midst of this crisis, we have housed the chronically homeless in New Zealand, and now we need to keep it that way. In this Budget, we are announcing an extra 8,000 houses, providing $5 billion of construction stimulus into the economy over the next four to five years for public housing and transitional housing. When combined with what we have already funded, this takes the number of housing places for those who need homes to 17,000 public houses and transitional housing. This represents the largest public housing building programme in recent decades, and I hope it means that COVID-19 will be remembered as a period where New Zealand didn't just stay home; it made sure everyone had a home.
Since coming into Government, we have seen countless other examples of the under-investment in New Zealand's infrastructure. We've already invested $12 billion into the New Zealand Upgrade Programme, and our $3 billion fund in this Budget will be squarely focused on projects that are ready to create jobs but also tackle issues like water infrastructure.
But perhaps there is no better example of a way this Budget can bring together the challenges of today and the challenges of yesterday than the jobs it will create in regional New Zealand to restore our environment. Whether it's working with iwi on pest control to prevent the loss of North Island forests, working with farmers to tackle everything from wallaby to fencing waterways or stabilising riverbanks, or whether it's working with council, local government, local businesses, and the Department of Conservation to employ thousands of people to restore wetlands, boost predator control, and improve tracks and huts, this is win-win. Wilding pine controls alone require on-foot labour, chainsaw operators, heavy machinery operators, and helicopters. It has a knock-on effect to accommodation, vehicles, repairs maintenance, and even food providers. In total, this Budget creates almost 11,000 jobs for our environment, for our regions, and for our people.
That brings me to the final challenge I wish to speak to today, and that is child poverty. We know this has the potential to get even worse than where we are now. While we moved quickly even before lockdown, providing increasing Government support to those out of work through benefit increases and through the winter energy payment, today again we focus on kids, with a major expansion of the food in schools programme. We already started this programme, and now we expand healthy lunches into schools so that for around 200,000 more children across the country, school lunches will be part of their everyday. Based on what we know, this will also create an estimated 2,000 jobs in local communities—jobs that can sometimes cater for the care requirements of sole parents, of mums and of dads who might have care responsibilities on their own. And equally important: it will mean in the tough days ahead we can guarantee our most vulnerable kids will get a filling, healthy lunch every school day.
I want to finish where I started: on our businesses, on our job creators, on our innovators, and on those who have carried such a huge burden over these last weeks and months. We know they have faced challenges too—challenges that do pre-date COVID. They include the cost of innovation, the need to constantly make productivity gains, and the challenge of growing beyond New Zealand, if you choose to make that leap. Many small businesses do need extra support to look beyond just the domestic borders of New Zealand—to look to export into Australia and beyond.
That's why this Budget provides incentives and grants to encourage e-commerce, train more digital advisers, and provide information and support for small to medium sized enterprises wanting to incorporate e-commerce into their businesses. This is off the back of the significant work of the Small Business Council, which was made up of small-business owners, operators, and backers, who encouraged us to support small businesses to improve their productivity through these initiatives. It sees significant increase in support for entrepreneurs and businesses looking to invest in new products through research and development. This will help create jobs, and the jobs New Zealand needs.
It also puts $216 million into increasing the number of exporters who will be receiving intensive support from New Zealand Trade and Enterprise (NZTE). It will also increase digital services and tools offered by NZTE. We know at this time that it has been our primary production, our food producers, and our exporters who have been the backbone through the lockdown, and they will continue to be our backbone. We need to support more of them to grow their exports, to bring more into those exports, and to position themselves well in the wake of the recovery. NZTE are well placed to do that, and we will support them to expand the businesses that they give one-on-one support to. We will trade on our brand. It is a brand entrenched in quality, in trust, and in respect of the products that New Zealand trade. Our response to COVID-19 has only further reinforced our brand as a country that invests in its people, that supports the health of its people, and that puts quality first.
I said yesterday that this Budget would be about jobs, jobs, jobs. In total, it seeks to save as many as 140,000 of them over the next two years and to support the growth of 370,000 more jobs over four years. [Interruption] In case the Opposition missed that—370,000 more jobs over the next four years. This Budget sets out a clear plan to generate green jobs, rural jobs, jobs rebuilding crumbling infrastructure, and new training opportunities for those who need it. But even this is just stage one. You've heard today about some of our sector recovery funds. We must keep working alongside those industries who have been most gravely affected. Tourism has a package announced today. In coming days we will do the same for arts, for sports, and for large events—those who have been at the front line of COVID and its impacts.
But, just as the science informing our health response evolved, so too will the economic situation both globally and domestically. It is for that reason that the finance Minister has announced today the next suite of actions we are putting in place but has also held back funds to tackle the next phase of our rebuild. That is what will be required to make sure we can be agile—and as agile as we have been today. We know businesses crave certainty in order to plan how they will operate, and, while there is much we cannot predict in these uncertain times, what I can promise is that we know this is not the end of what we need to do. We will keep working with you. We will keep supporting workers and businesses. 
You can see the strength of the Government in this Budget, and I do want to thank our coalition partner—our coalition partner, New Zealand First; our Deputy Prime Minister—for the partnership bringing this Budget together today. I'd also like to also thank our confidence and supply partner, the Greens, for their consistent advocacy to be bold in tackling the challenges of both today and tomorrow.
But, finally, I want to thank our Minister of Finance. Grant, thank you for your determination and for your compassion. Through this crisis you have acted to protect the jobs and livelihoods of millions of New Zealanders. Today, you deliver a Budget that will carry us through the crisis and get this economy moving and get us into growth as early as within a year, and that is a remarkable thing. So now we get on with it. We went hard and we went early to fight COVID-19, and that success has opened up economic opportunities. Now it's time to make the most of the head start New Zealand has with this economic recovery. This Budget shows how we are positioning New Zealand for that right now. It shows that this is not the time for business as usual; it's a time for a relentless focus on jobs, on training, and on education and the role they all can play to support our environment and our people. So let's begin our recovery. Let's rebuild, together.





Rt Hon WINSTON PETERS (Deputy Prime Minister): Thank you very much, Mr Speaker. Acknowledgments to our Cabinet colleagues and party Ministers: Tracey Martin, Shane Jones, and Ron Mark, under-secretary Fletcher Tabuteau, and to our caucus colleagues. Thank you for your support, your hard work, and successes announced today. We stand here today in support of the coalition Government's Budget. It's a Budget that responds aggressively to our present conditions, it's a Budget that will support our transition to recovery, and it's a Budget that has our people, New Zealanders, front and centre.
The COVID-19 pandemic is a completely new situation in which the coalition has very few familiar guidelines to shape our response. We are in unchartered waters. In this novel situation, we look to history to help guide our thinking about the Government's health and economic response and recovery strategies. US President Franklin Roosevelt's response to the Great Depression is one lesson to draw from. He had no playbook for his response and nor do we. We've had to learn as we go, always with the health of our most vulnerable people foremost in our mind.
The first Labour Government, you'll recall, in 1935, responded to the ravages of the Great Depression with compassion and practical wisdom. The fourth Labour Government, in contrast, responded through ideology and blind devotion to neoliberal economic theory. The former tradition helped the many survive a massive disruption and its success settled public policy, even National Party policy, for the next 50 years; in stark contrast, the revolutionary tradition adopted by Roger Douglas and Ruth Richardson favoured the few and left abandoned a lost generation of New Zealanders, cynically cast adrift as no longer economically viable.
This is a crisis where we need to park our ideology at the door. We can well recall at the beginning of the neoliberal experiment in 1984, its disciples saying "Farming is a sunset industry".
Hon Member: Oh yes, I remember that.
Rt Hon WINSTON PETERS: You remember that? "Farming is a sunset industry." Well, today—
Hon Gerry Brownlee: He was one of them.
Rt Hon WINSTON PETERS: Well, today—no, don't tell me it was one of them, because I was in the National Party at the time where they were giving—that's Mr Brownlee's lot—the architect of that Budget, Roger Douglas, eight out of 10 for his Budget. They were meant to be in the Opposition; they were acting like a bunch of fifth columnists—unbelievable. I know you hate to remember it, but I remember it with telling concern that here we are in 2020 and they've learnt so little. You know, Mr Bridges, my advice in the first day of the COVID crisis level 2 is to get a haircut and get a real job.
Can I just say, "Farming is"—they said—"a sunset industry". Well, let me ask you up there in the gallery, which industry is standing tall today? Which industry is standing tall today? 
Hon Gerry Brownlee: David Lange—over and over and over.
Rt Hon WINSTON PETERS: And for any seeking to defend with blind ideology, like Mr Brownlee, again, opens his mouth, lets the wind blow his tongue around. He uses these occasions to make a constant fool of himself. I want to tell the listeners in New Zealand today, that man shouting like a lunatic is Mr Brownlee from Christchurch—the woodwork teacher. For any seeking to defend—
Hon Gerry Brownlee: Oh, there you go. Put the boot into the workers, as usual.
Rt Hon WINSTON PETERS: Here he goes again. Can you hear him? See noise, he thinks, is volume, and volume, he thinks, is substance. No, Mr Brownlee, I'll give you the short lessons in life. Just close your mouth, open your ears, you just might learn something for the first time. For any seeking to defend blind economic theory there are countless other examples to destroy the validity of that belief. Desired ends and means need to match, and this coalition Government's third Budget locates the coalition's COVID-19 response closer to the first tradition, while it utterly rejects the second.
Did you hear Mr Bridges say, when he said that the Government is going to bring in new taxes? Mr Bridges, it's 2009. 
Hon Members: Ha, ha!
Rt Hon WINSTON PETERS: No, no. It's not '99. In '99 you were going out, but it's 2009—Mr Bridges, it's 2009, and Mr Key had promised no new taxes. Why are you laughing? I'm giving you a reminder of history, and it's not so long ago; it's only 11 years. So it's 2009, he promises no new taxes, and then he put up GST. 
Hon Gerry Brownlee: He dropped income tax.
Rt Hon WINSTON PETERS: And dropped income tax for his mates—for his mates, unbelievable. You know, you can't help some people, but you can keep on trying.
Can I just say, we have the ends and the means to match. We have our eyes wide open about the impact of this crisis. Every ounce of our collective effort is going to be required to fix it right here, right now, in the short term, the medium term, and the long term. Can I just say to the National Party over there—looking somewhat bewildered and saddened—that if they don't listen, the numbers in that gallery are going to be the numbers who don't come back to the National Party at the next election. Have a good look. Keep quiet and learn something.
Simply put, the people are our best resource to drive our economic recovery, and we, here, back New Zealanders. We owe New Zealanders nothing less. Their commitment to keep their vulnerable neighbours and families safe is one of the most outstanding community-wide efforts in our country's history. And in recognition of this, we'll be taking to our Cabinet colleagues a proposal to create a special COVID commemorative medal—a CCM for service to New Zealand communities. The medal will acknowledge the many New Zealanders who led their communities since the pandemic hit our shores. Front-line health staff such as doctors, nurses, as well as community leaders of all types will be eligible to be nominated for, say, 5,000 medals that will be for a lifetime. The honour would follow the current honours and awards process. Because we're going through a historical moment in time, we should, as a society, celebrate the many contributions citizens have made to keep our team of 5 million safe. The COVID commemorative medal would be, as I said, for life, and we see it being passed on to heirs and successors long into the future—a permanent reminder of a time in our nation's life when we drew upon the best of our national character to protect life.
Now, the Government knows that it must balance the immediate needs of our people with long-term needs to refashion a vibrant future economy. When this lockdown started, New Zealand First knew that the country faced a massive economic downturn. We also knew that the Government would need to intervene to keep business running and people employed. We might not always get everything perfect, but the coalition is willing to try anything and do everything to help business survive and save jobs by providing a cushion as the country transitions to a new equilibrium. This year's Budget is about recovery, and the Government is certainly using its balance sheet to assist the post-lockdown economic phase of our response.
So while all the rules of fiscal prudence are now obsolete, the coalition is committed to maintaining our comparatively low debt position against those countries we compare ourselves with. And you can't compare the same debt as the previous Government. We're paying three times less in interest now than three, four, and five years ago, when this group over here, in response to the crisis of corruption and fraud at Wall Street called the global financial crisis, decided that they would go from a Government debt of $10 billion to $82 billion, and they have the effrontery, with those high interest rates at that time, to say that they could do better.
In fact, Mr Bridges today said that we had no experience in how to run a country. Really? I mean, Mr Bridges, what's your business experience? Dare I say it, Mr Goldsmith, what's your business experience? And, Mr Goldsmith, if, because of the latest polls, as an MP, your job is gone, I suggest you start looking hard at Epsom, because on the list you won't make it. I suggest you get real—eyes wide open politically—
David Seymour: Where's that member's seat?
Rt Hon WINSTON PETERS: —and ensure—what's this member going to do? Go on to be, again, a responsible, permanent face of New Zealand politics. Where am I going to be? I know, but where are you going to be? Well, he's going to be applying for one of those applications that we made possible today in the Budget! We even thought of him. We've got the application even going till October, when he's had time to get his three months, and then find out what reality is all over again. Can I just say, I cannot believe somebody over there shouting, who's been the leader of a party of one since 2011, getting all the parliamentary largesse as a party. Who does he lead? Himself. No wonder he's confused—no wonder he's confused—
Hon Member: And he still won't listen.
Rt Hon WINSTON PETERS: —and he still won't listen. Amazing.
Can I just say that all the rules of physical prudence are now obsolete. The coalition's committed to maintaining our comparatively low debt position against those countries that we compare ourselves with.
Chris Bishop: Say that again louder!
Rt Hon WINSTON PETERS: I beg your pardon?
Chris Bishop: Say that again!
Rt Hon WINSTON PETERS: Say again?
Chris Bishop: Say the fiscal prudence thing again.
Rt Hon WINSTON PETERS: Well, can I say "Snapchat that". That's what the rest of the world says. You Snapchat that, sunshine, all right? We want to get there as quickly as possible, but this is a marathon; not a sprint. We'll need all of us working together.
The Government initiated a wage subsidy scheme early on. The targeted extension of that, announced today, is an example of balancing urgent need with greater fiscal targeting. Today, we welcome the $4 billion business support package. A significant change in the tax system and low interest-free loans will support businesses to recover and help retain jobs. Even Maggie Thatcher learnt that if you can keep a business going, it costs you a whole lot less than trying to start one new one. New Zealand First understands the crucial role that business plays in creating the nation's wealth, and today's announcements, while they will help, are not the end of our support. Where the Government could, and we should, we've changed regulations and legislation to increase economic activity. 
Most notable is fast-tracking the Resource Management Act consenting process to spur job creation. Congratulations to the Hon David Parker for doing quickly what they wouldn't do for nine long years—nine long years of utter inertia. They were so desperate that they started blaming New Zealand First for not changing the—
Hon Gerry Brownlee: That's right.
Rt Hon WINSTON PETERS: —Resource Management Act. Who, Mr Brownlee, was in Government? You, with your other three parties—
Hon Gerry Brownlee: Well, I hope the Greens are with the Government.
Rt Hon WINSTON PETERS: —or New Zealand First? He is so perverse this man that he thinks shouting in some stentorian idiocy substitutes for being an MP.
Hon Anne Tolley: No, that's your claim.
Rt Hon WINSTON PETERS: Oh, here comes the member from the East Coast. Tell me, what happened to the railway line between Wairoa and Gisborne that she is meant to be in charge of? [Interruption] I can't hear you. What did she do? Hey, I've got it: doughnuts—doughnuts for all that time. She's got these people on the backbench that think that shouting out somehow is going to save them. Gentlemen, I know the polls: it's not. The latest polls that Mr Farrar gave you say that that bunch up there in number symbolically are all gone. Now, if you are concerned, give me a phone call, I'll try to help.
Now, the Government could, as I say, change regulations; Mr Parker did. So you've heard us say, time and again, that if a job can be filled by a New Zealander—
David Seymour: Ha, ha!
Rt Hon WINSTON PETERS: —then that job should be filled by a New Zealander. Oh, Mr Seymour laughs. He finds it a novel precept. He thinks it's laughable. Here's the guy from Epsom, Mr Seymour, who sees less every day and he's shouting out here again. This is a guy from a party of one, these last nine years. That would make me modest if I was in his position, but not him. No, no, shouting out like a fool, and he'll be opposed and he'll be gone. National will take him out.
David Seymour: Bye, bye, Winston.
Rt Hon WINSTON PETERS: You know, there will be a very large number of people—you know, as Muldoon used to say, "I'll be around long after you've gone, son." Ha, ha! I'm sorry but—
SPEAKER: Muldoon said that to me, too.
Rt Hon WINSTON PETERS: Oh, did he say it to you, Mr Speaker?
SPEAKER: He did.
Rt Hon WINSTON PETERS: All right, well he's wrong there. But I'm right here.
There will be a very large number of people needing employment or redeployment, especially for many thousands employed in battered tourism and hospitality sectors. Budget 2020's trades training package of over $1.4 billion will provide opportunities for New Zealanders of all ages to acquire new practical skills as they adapt—
Hon Member: Who wrote this?
Rt Hon WINSTON PETERS: —to dramatically—I'm able to write my own speech; not like that nincompoop over there, I can write my own speech, always have, unlike him. Ha! He shouts out, "Who wrote this speech?" because apparently he doesn't write his own.
Now, we're talking about dramatically changed labour market conditions, and this Budget provides also $3 billion—$3 billion—to infrastructure projects across the country. That's in addition to $12 billion from the New Zealand Upgrade Programme. Minister for Infrastructure and champion of the provinces, Shane Jones, will be leading the charge on implementation and delivery.
So, in short, we walk the talk; not the other way around—just talk. We walk the talk. We under-promise and we over-perform. When people ask us for help, we turn up with the money; we don't say to Defence, "We'll give you $20 billion" and don't give them a cent. No, no, Mr Mark can talk about the billions that he's got—4.5—since he's been a Minister with respect to defence. Dramatically different to their opinion when they had the job.
You know, our focus is threefold: immediate job creation, income growth, and construction activity to be under way within coming months. Government support, however, is not unlimited, so we're targeting assistance to those who need it most. It means striking a fair balance between social need and personal responsibility. All New Zealanders need to be productive, and if we—New Zealanders—can help in any way to fund our society, then we all should. We owe it to taxpayers, current and future, to do so. 
It pays to remember that COVID-19 is a global crisis. But before the COVID-19 pandemic, the global economy was already in serious difficulty. Slow economic growth and massive accumulation of debt reinforced that fundamental factors behind the 2008-2009 global financial crisis and recession were never resolved; they were just plastered over. The global system had received a massive shock, and the chickens have come over to roost, and some of us have been saying it for a long, long time. We are the ones who are going to learn from the COVID-19 experience. Clearly some in this Parliament have no capacity to learn.
Can I just say that New Zealand may be tracking well but many, many countries are not. We anticipate the second order disruptions will kick in as the global economy struggles to adapt and while the risk of second wave COVID-19 outbreaks threatens to prevent an orderly return to economic wellbeing. Thus the notion of returning to business as usual fades by the day as global output collapses and unemployment soars. With that warning, we know our destination: a new normal for New Zealand's recovering economy.
What does a new normal look like? Well, it means our team of five million will need to draw on each other's strengths. We need greater autonomy for the New Zealand economy. This means having the ability to grow it and make it and use it rather than waste it and waste valuable offshore funds importing it. As we've said, over and over again, it's time to put up the shutters to offshore ownership of the New Zealand economy, and to go back to owning as much as we possibly can. That would provide us with greater sovereignty over future choices. Overseas investment should be encouraged only where it expands our employment wealth creation and export capacity in a way that is clearly new and not just an offshore takeover of what we're already doing. Overseas investment can be a good thing, but it must be balanced in terms of New Zealand's economic needs.
There are lessons in the COVID-19 pandemic and worldwide economic collapse; only a fool would ignore them. The Budget's a keystone milestone and key milestone in our response to COVID-19. We can liken this moment to something Winston Churchill said in 1942. He said, "Now … is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning." Our battle with COVID-19 is momentarily paused, but we can still lose it if we don't remain vigilant. Five million New Zealanders are winning the battle; now we ask them to fight again, a battle that is even harder—it's for the country's economic prosperity. If they show the same resolve that they have so far, we'll win. Failure's not an option. All of us New Zealanders need to know that not reaching our goals won't be through a lack of ability but a lack of commitment. The coalition has the commitment to see it through but we need New Zealand's help. After observing the country's brilliant effort to keep the virus at bay, we know we'll get that help. Our challenge, our quest, and our commitment can be summed up in three words—it's J, B, and B: jobs, business, and balance. Together we will win.





Hon JAMES SHAW (Co-Leader—Green): E Te Māngai o Te Whare, tēnā koe. Ki a koutou ōku hoa Pāremata, huri noa i Te Whare, ngā mihi o te Tau Hou ki a koutou katoa.
[To the House, greetings. To you, my parliamentary colleagues throughout the House, happy New Year to you all.]
The day that New Zealand declared a national state of emergency and went into level 4 lockdown, there were 50 new cases—50 new cases on just that one day; 50 cases that took the total number of cases from 155 to 205. That's a one-third increase in the total number of cases from just the day before. At that time, it seemed that we were on our way up an exponential J-curve of human misery, mortality, and mourning. And on that day, as we passed the motion to declare a national state of emergency, I said that everything that we do from now onwards we are doing to protect the people that we know and love and also those that we don't. And over the past seven weeks, people in every home and every community and every business across New Zealand have done exactly that. There are, today, only a handful more active cases in total as there were new cases the day that we went into lockdown.
Over the past seven weeks, every one of us has protected and cared for every one of us. But none have done more than those we have come to know as our essential workers. These are the people who left their families every day and risked their own health every day so that the rest of us could be cared for and get everything we needed—like the ingredients of sourdough bread: our nurses and our pharmacists, doctors and midwives, paramedics and social workers, aged-care and community workers and caregivers more generally, our police officers, our customs officers, those who worked to get our homeless into emergency housing, our farmers and food producers, our delivery drivers, our supermarket staff and dairy owners—the people who, it turns out, are actually the ones that make our economy run.
These people have always been essential. And yet there are people in this House, members of this House, who still do not believe that these people deserve to be paid enough to live on. I have listened to the Leader of the Opposition thank our essential workers for carrying this country through the state of emergency—and they do deserve our thanks, of course. But they cannot eat thanks, Mr Bridges. They cannot heat their homes with thanks. They do deserve our thanks, but they need our support. And now that the worst of the health crisis does appear to be behind us, let's make sure that these people have the lives and the livelihoods that they truly deserve. That is what this Budget is all about: livelihoods, jobs—jobs that see us through this crisis and that craft a future that works for everyone.
Actually, Mr Bridges said he's got a five-point plan. Well, I'm going to do it in four. This Budget is about, first of all, keeping as many people in their jobs as possible. Second, where that's not possible, it's about getting people the training and the education that they need to get a new job as soon as possible. Third, it's about supporting people who don't have a job to be able to support themselves and make ends meet and provide for their families in the meantime. And fourth, it is about investing directly in the creation of new jobs—jobs that provide a good day's pay, doing meaningful work, building an even better country than the one that went into lockdown just seven weeks ago.
One of the best ways to create meaningful, well-paid jobs quickly is by investing in nature. From today, our Government will invest $1.1 billion in green jobs, restoring our natural landscapes, our native bush, our wetlands, our coastlines, and our waterways. That's about 11,000 jobs over the next four years of meaningful, well-paid work for people to access so that they can continue to provide for their families whilst we weather the economic storm of the pandemic crisis. This $1.1 billion investment will not only create jobs in our hardest hit regions, it will help to ensure that future generations now and in the future have healthier forests, rivers, and harbours. And it will help to soak up a fair amount of carbon dioxide too.
Our jobs for nature programme includes $433 million for restoring wetlands, rivers, and estuaries all around New Zealand and, in particular, our country's largest harbour, the Kaipara. There is $200 million for a new jobs for nature fund, partnering the Department of Conservation with councils, tourism, businesses, communities, iwi and hapū all over the country; $147 million for pest control and eradication advancing the vision of a predator-free New Zealand and working with iwi to save North Island forests; $154 million for the Department of Conservation to work with the Queen Elizabeth the Second National Trust, regional councils, landholder groups, and farmers to roll out jobs that improve indigenous biodiversity on both public and private land—you see, I thought they'd like that one.
There is $100 million for wilding conifer control—also on both public and private land; $27 million to get on top of the wallaby population in the Bay of Plenty, in the Waikato, in Canterbury, and in Otago; $7 million to control pests and weeds in riverbeds and to eradicate aquatic weeds in Lakes Wakatipu and Wānaka. There is so much work to be done in this country making things better for everyone.
All Governments, ours included, should be judged on what they do to improve people's quality of life in a sustained and a sustainable way. Now, since we came to power, we have been advancing towards that goal, laying the path towards a net zero-carbon economy, building thousands of new homes, and making education more accessible for more people. And then the pandemic arrived. Almost immediately, COVID-19 revealed one particularly troubling aspect of our economy: just how fragile it is. It showed that we have been operating on a very thin margin for many years. We squeezed everything out of global supply chains in the name of just-in-time efficiencies, and the pandemic has shown us just how vulnerable that system can be. But we also squeezed everything out of our people and the pandemic has shown just how vulnerable they are when a crisis strikes.
The vast inequalities of our economy may be easier to see now, but the truth is they existed long before COVID-19 came to New Zealand. So if we want to truly build back better this time, we have to deal with the underlying conditions of inequality and environmental degradation that our economy has for decades made worse. Then, and only then, can every part of the economy go to work to create prosperity that is more equitable, more resilient, and more restorative of the natural world that we depend on for our very survival.
Now, if we are going to bring forward billions of dollars of our children's money and invest it in rebuilding our economy, then we have both a moral and an economic responsibility to put that money to work on the long-term challenges facing our country that our children would otherwise inherit and have to deal with and pay for themselves. Every dollar that we borrow from them to get through the pandemic crisis is a dollar that they cannot spend getting through another crisis—like the climate crisis or the housing crisis; like the crisis in our rivers and our lakes, our oceans and in our forests; like the failing water pipes under our towns and in our cities; like our ever-expanding landfills; or the need for more and cleaner power to get us through to a zero-carbon economy.
That is why the protagonists of our recovery story are not convention centres but people. Putting people into work restoring nature alongside the huge investment we are making to build 8,000 new public homes will direct money into the parts of the economy where most people earn their livelihoods. Whether it's selling food in a cafe, running a local business providing services to the community, or providing after-school care, these are the parts of the economy that people depend on. They are the parts of the economy that are sustained when public investment is directed at getting people into work and earning money that they then spend in their local community.
The Green Party has always said that investing in nature is the best way to create good, well-paid jobs. Twelve years ago our predecessors in the Green Party campaigned for a "Green New Deal" in response to the great financial crisis. As an Opposition party at the time, of course, they weren't in a position to implement it. Put simply, this Budget shows what it means to have Green voices in the Government—like the voice of Marama Davidson, who, when she took on the co-leadership of the Greens, also took up the leadership of our campaign to end child poverty. Well, today's Budget scales up the food in schools programme, which, when we were in Opposition, we fought for, from 8,000 to 200,000 students, with $218 million of new investment.
Golriz Ghahraman has campaigned for the rights of migrants and the refugees who will find it easier to rebuild their families after Budget 2020's injection of $33 million into the family reunification system; and Gareth Hughes has for a decade pushed to get people into work insulating homes, making them warmer and more affordable. Budget 2020 has put an additional $56 million into the Warmer Kiwi Homes initiative; and Jan Logie's all-of-Government response to family and sexual violence has picked up an additional $202 million in today's Budget. Chlöe Swarbrick's work on behalf of students, particularly in recent weeks, has helped to secure a $20 million hardship fund to help students to weather the pandemic crisis.
Julie Anne Genter's work with Phil Twyford has helped to deliver $1.6 billion in this Budget's infrastructure upgrade for metropolitan rail in Auckland and Wellington, buses and cycling in Queenstown, Auckland's new SkyPath, as well as extra help funding councils to expand footpaths and roll out temporary cycleways—and that, I have to say, is on top of the $1.1 billion for the intercity rail network and the Interislander that Budget 2020 also delivers. Kia ora, mātua.
And, of course, there's Eugenie Sage. It's due to her groundwork over the past 2½ years that today our Government is able to scale up our investment in nature as the most essential infrastructure and the best job creator in Aotearoa. 
Brett Hudson: Digging holes in the forest.
Hon JAMES SHAW: Why do you hate nature, Brett? This is a Budget that does what New Zealanders sent Green MPs here to do—improve wellbeing, provide support to those who need it the most, and restore our natural heritage. This is a Budget that understands that the true source of New Zealand's wealth and prosperity are its natural and its human capital. It is a great start, and it is just a start. The sheer scale of this stimulus that's required to get us through the recovery means that we have an opportunity now to embrace the potential of good science and good Government to support a clean-tech, high-value economy that works for everyone.
As we plan the next phase of our economic recovery, we have a choice. We can choose to direct this stimulus towards a more circular, regenerative economy, an economy that is not degenerative by design but that is regenerative by design. If we do this, ours can be a future where people have everything that they need to lead fulfilling and meaningful and prosperous lives, where simple everyday tasks like making the morning coffee, or travelling to and from work, or warming our homes are powered by clean renewable energy; a future where, instead of heading for landfill, the leftovers from one production process, be they food scraps or scrap metal, become the source materials for the next, and where the water coming out of our taps is safe to drink and never runs dry, and the roofs over our heads are safe and warm—above all, a future that is more equitable, more prosperous, more innovative, and all within planetary limits. What we need in the long term, then, is not a recovery but a renewal—a renewal of our relationship with the natural world and with each other.
This pandemic has opened a window on to something new, something better. We can see it's out there, but the question is whether we have the courage to step outside, to find the space that we need to reimagine the economic house of cards that we've built for ourselves. There is so much good work to be done making things better for everyone. Of course, we can choose to stay inside and be burdened with the knowledge that the people who keep us well and make our economy run will continue to be underpaid, that our precious wild spaces will continue to be decimated, and our atmosphere polluted, or we can step outside and reimagine our world anew. This Budget is the introductory chapter to a longer-term vision for a more prosperous, more equitable, and greener New Zealand. Nō reira, tēnā koutou, tēnā koutou, tēnā tātou katoa.





DAVID SEYMOUR (Leader—ACT): Thank you, Mr Speaker. Many countries have faced the challenge of rebuilding from destruction. There are two basic strategies that they have tried to take. One is the path down which this Government is going. It's trying to plan an economy from the Beehive, and I have no doubt that the MPs on the Government benches are sincere. They really do believe they can get New Zealanders back to work by borrowing, spending, and investing money better than the people who earned it. The other path is an outward-looking recovery led by private sector job growth, and the record of history is crystal clear. Countries that look inward for jobs and growth find neither. Those that replace the private plans of five million individual New Zealanders with their own blunt plan funnelled through the bureaucracy of Wellington make us poorer, not richer. 
This Budget, unfortunately, throws so much money at so many problems that we end up with debt that couldn't have been imagined by any party in this Parliament, even just a few months ago. There's $5 billion for "KiwiBuild 2", I'll call it; Kāinga Ora, I think, is what the Government prefers. You'd think they might have learnt the first time. There's a $4.6 billion blowout on trains and ferries; that's Winston Peters' bauble this year. Now, if you thought that his speech and his rhetoric was old-fashioned, look at the things he's wasting taxpayers' money on. The guy doesn't even know which century he's in. There's a billion dollars for some Kiwis to go bush—I call it the "Barry Crump Fund". So you're going to have some people planting pine trees, you're going to have other people pulling down wilding pines, and some other people shooting a wallaby infestation caused by the Government's ban on semi-automatic firearms. And the only question is whether or not there's going to be more or less pine trees by the time the exercise is over. My bet is on the wallabies.
There's a $400 million tourism fund, and the press release, I would estimate, is a million dollars a letter, because there is so little detail, the Minister of Tourism hasn't a clue. He was asked on the Epidemic Response Committee what tourism was, and—I'm not making this up—he said, "Tourism is hard to define." No wonder he doesn't know how to spend $400 million dollars on tourism, but that's this Government's plan.
There's over $200 million to reinforce the message that it's not a parent's job to send their kids to school with their own lunch. And the sadness of that is that those kids are going to learn over a long period, the hard way, that there is no such thing as a free lunch, because they're going to grow up in a New Zealand with triple the public debt—$140 billion, over $70,000 per household borrowed by the Government in their name in this Budget.
The other problem is what's not in the Budget. I couldn't believe it. I thought, we've got an idea in ACT's alternative budget that's so obvious the Government will steal it. Let's put front and centre investing in public health and having the world's smartest borders. It should be so obvious. We are an island nation dependent on trade, on export education, on tourism, that's just been cut off from the rest of the world. We're a country that had to go into the bluntest lockdown, the bluntest public health approach imaginable that has flattened the economy and the livelihoods of so many New Zealanders. Why? Because we didn't have the public health technology to fight a virus like Taiwan did. We didn't have the ability to see what was coming and track and trace a virus like Taiwan did, and we weren't able to achieve only six deaths with no lockdown. That's the gold standard. That's what ACT's alternative budget calls for. That's what the private sector needs to get going again and create jobs, and I couldn't see it in this Government's Budget. That is an enormous fail.
Treasury is forecasting that there'll be no COVID-19 restrictions by next April; by April Fools' Day next year, we'll have no more restrictions. Well, that's a heroic forecast and borderline fraudulent when the Government hasn't made it a priority to control COVID without restrictions. 
The other thing that is missing, because there's so much money thrown at so many problems in such an unguided and wasteful way, is tax cuts. There's two ways to do stimulus: there's take and borrow money and throw it at every problem the Government can imagine, or stop taking so much of people's money in the first place, and the ACT Party's alternative budget would give a year of GST down at 10 percent, putting $6 billion back in the hands of the businesses and the people that earned it. The ACT Party's tax cut, which would be permanent, would be $3 billion of reduction in income tax with a broad middle income tax cut, dropping the 30 percent rate to 17.5 percent. That budget would allow the Government to spend only an extra $40 billion. It would have saved the next generation, and the current generation, of New Zealanders $100 billion of borrowing that this Government is about to undertake, and how? The other thing that's missing from this Budget is any kind of analysis or focus on improving the quality of spending already there. So on the one hand, the Government says, "These are extraordinary times." That's their approach to expenditure. Then they say, "It's business as usual." That's the approach to existing expenditure. So we have extraordinary new expenditure, business as usual normal expenditure, and a Budget blowout, and $140 billion—70 grand per household—in extra debt.
Then we have the question of why it's so hard to get stuff done. The Government has recently discovered what the private sector knew about the Resource Management Act all along. It makes it damn difficult to get things done. And the Government's solution is to exempt its own projects from the Resource Management Act, leaving the burden on everyone else. Well, the ACT Party says that's the wrong way round. We should be replacing the Resource Management Act with the better urban planning initiative from the Productivity Commission so that everybody can build more easily to get this economy going. 
There's always been more capital overseas than in New Zealand, and nobody can create jobs—not even the Government—without capital. The Government's approach of becoming even more xenophobic about foreign direct investment is one of the most damaging initiatives in this Budget. The ACT Party's alternative budget would lift the restrictions on foreign direct investment for investors originating in friendly, democratic, OECD countries. That's the kind of initiative that we need in order to get our economy moving.
I've nearly run out of time in this speech when there's so much more to say, and that's a shame because people need to see how stark the difference is. On the one hand, you've got the Government of KiwiBuild that wants to rebuild our whole economy with your money. On the other hand, we have freedom, free markets, and a job-rich, private sector - led recovery that New Zealanders deserve. Thank you, Mr Speaker.





Hon PHIL TWYFORD (Minister for Economic Development): I move, That this debate be now adjourned.
SPEAKER: The question is that the motion be agreed to. Those of that opinion will say Aye; of the contrary opinion will say No. The Ayes have it.
Hon Members: Party vote.
SPEAKER: A party vote is called for.
Hon Gerry Brownlee: No, I think you misheard.
SPEAKER: No, no, wait, wait, wait. I apparently misheard Mr Woodhouse when he called for a party vote.
Hon Michael Woodhouse: A hearty bloke, I said!
SPEAKER: Do you want one or not?
Hon Michael Woodhouse: No.
SPEAKER: No? All right. OK.
Motion agreed to.
Debate interrupted.





URGENCY
Hon CHRIS HIPKINS (Leader of the House): I move, That urgency be accorded the introduction, first reading, and referral to a select committee of the Overseas Investment (Urgent Measures) Amendment Bill, the Overseas Investment Amendment Bill (No 3), and the Forests (Regulation of Log Traders and Forestry Advisers) Amendment Bill; and the introduction and passing through all stages of the Customs and Excise (Tobacco) Amendment Bill, the Family Court (Supporting Families in Court) Legislation Bill, and the Remuneration Authority (COVID-19 Measures) Amendment Bill. 
As has long been the custom on Budget days, the Government intends to move urgency to progress legislation that delivers on some of the Budget's priorities and addresses issues that need a rapid response. This year, those of course include our response to COVID-19. Three bills will receive a first reading and be referred to select committee; three others will pass through all of their stages. 
Two of the bills are concerned with overseas investment, the landscape of which has greatly changed as a result of COVID-19. The Overseas Investment (Urgent Measures) Amendment Bill contains measures that need to be put in place urgently to mitigate the economic effects of COVID-19, and we're referring that bill to the Finance and Expenditure Committee for 10 days. 
The Overseas Investment Amendment Bill (No 3) proposes measures that allow risks posed by foreign investment to be managed more effectively. This bill will not have a shortened select committee referral, but it's important that the committee is aware of the issues that it covers in order to enable them to consider the first bill effectively. The Forests (Regulation of Log Traders and Forestry Advisers) Amendment Bill strengthens the integrity of the forest supply chain. COVID-19 of course has highlighted the need to increase the resilience of this very critical sector as quickly as possible, and the bill will go to select committee for a shortened period of three weeks. 
The Customs and Excise (Tobacco) Amendment Bill enacts measures to combat tobacco smuggling and secure Crown revenue from taxes on tobacco, and, as such, it's closely linked to the Budget. It is important to have the bill enacted now so that preparations can be made for its provisions to take effect. 
The Family Court (Supporting Families in Court) Legislation Bill addresses the delays in the Family Court processes that have occurred since the process was reformed in 2014. It's urgently needed to speed up the resolution of conflict, including family violence issues. 
The Remuneration Authority (COVID-19 Measures) Amendment Bill allows the Remuneration Authority to make temporary reductions to the salaries of elected politicians and senior public officials in response to COVID-19. The need for that to happen urgently is self-evident. 
I do commend this motion to the House. 
Motion agreed to. 





OVERSEAS INVESTMENT (URGENT MEASURES) AMENDMENT BILL
First Reading
Hon DAVID PARKER (Associate Minister of Finance): I move, That the Overseas Investment (Urgent Measures) Amendment Bill be now read a first time. I nominate the Finance and Expenditure Committee to consider the bill. At the appropriate time, I intend to move that the bill be reported to the House by 25 May 2020 and that the committee have the authority to meet at any time while the House is sitting (except during oral questions), during every evening on a day where there is a sitting day of the House, and on a Friday in a week in which there has been a sitting in the House and outside the Wellington area, despite Standing Orders 191, 193, and 194(1)(b) and (c). 
This bill contains measures which the Government considers are needed to be put in place urgently to mitigate the economic effects of COVID-19. As we restore, recover, and rebuild the economy from the effects of COVID-19, it's imperative that we protect New Zealand's long-term interests. The bill's purpose is to ensure that the risks posed by foreign investment can be managed effectively while reducing the regulatory burden of the screening process, and so to support the role of productive foreign investment in our recovery. In particular, we need to minimise the possibility that some cornerstone businesses in our productive economy are sold in a way contrary to our national interest while the pandemic is causing the value of many enterprises to fall. 
This is one of two bills I'm introducing as a package. The other, which follows, is the Overseas Investment Amendment Bill (No 3), and it contains the remainder of the provisions that have been included in the previously introduced Overseas Investment Amendment Bill (No 2). It's my intention that the provisions of this urgent bill that are permanent, which include the national interest test, will be subject to full select committee scrutiny through the normal process of Parliament's consideration of the No. 3 bill. 
The COVID-19 global pandemic and related economic downturn has changed the foreign investment risk environment. Falling enterprise values are increasing opportunities for overseas investors to acquire ordinarily productive firms or strategically important assets at fire sale values without Government scrutiny. That reduced value may not reflect the importance of the business to our economy, and interim controls are needed to protect our national interest. Some of those businesses may be best kept in New Zealand ownership to help our recovery. 
Such a sale can on occasions also result in risks to New Zealand's national security or an offshore transfer of knowledge and jobs. New Zealand is not alone in recognising the need to increase oversight of foreign investment in response to COVID-19. Australia, Canada, and a number of European countries have already taken steps to manage these risks. 
Equally, productive foreign investment will play an important role in New Zealand's economic recovery. Other parts of the current screening regime unnecessarily limit New Zealand businesses' access to the productive foreign investment they need to survive the crisis and thrive in the recovery. The bill I introduce today seeks to introduce these issues by introducing specific issues to increase oversight of foreign investment in response to COVID-19 as well as broader tools to ensure that we can manage risks associated with investment in our most sensitive assets. We're cutting red tape to increase our attractiveness to the sort of foreign investment we need for our economic recovery, and we're strengthening our ability to enforce the Act to ensure these new tools to increase oversight operate effectively. 
The Government needs the ability to rapidly respond to foreign investment risks and protect essential interests at this time of unprecedented crisis. This bill introduces a new emergency notification regime which will require overseas persons to notify the Overseas Investment Office of proposed investments of, generally, 25 percent or more in an existing business. Instead of the normal threshold of at least $100 million, the temporary threshold will be zero; it's what Australia's done too. This screening power will allow the Government to assess these transactions and, if necessary, consider whether they're contrary to New Zealand's national interest or whether they should be approved, perhaps on conditions. 
I expect the large majority of transactions will be triaged and approved to proceed 10 working days after notification. A much smaller number of transactions are expected to require a more thorough assessment against our national interest test. The lower threshold for the exercise of the national interest test is temporary. That power will be reviewed every 19 days and will only remain in place while New Zealand is suffering from the economic effects of COVID-19. The emergency notification power is in addition to two other tools that were originally part of the Overseas Investment Amendment Bill (No 2), and this bill carries forward those two tools to close gaps in our screening regime. 
Currently, the Government doesn't have sufficient ability to block transactions that are contrary to our national security, the functioning of our democracy, and other core national interests. This bill introduces a national interest test that can be applied to transactions already requiring consent under the existing regime. This power will be used rarely and carefully, and only if the Minister responsible for the Act considers that it's necessary. This will ordinarily be the Minister of Finance—not the Minister to whom most Overseas Investment Act decisions are routinely delegated. This national interest test is modelled on the Australian equivalent, which also has a wide discretion rarely exercised. 
The second new power is a narrow call-in power that will enable Government to review, on an enduring basis, investments in some strategically important businesses such as firms developing military and certain other advanced technologies that may pose significant risk to our national security or public order. That call-in power ensures that we can manage these risks permanently. 
Foreign direct investment remains important to support our recovery, and this bill also brings forward some measures to cut red tape. Cutting red tape means encouraging investment by reducing the number of low-risk transactions that are unnecessarily caught by the Act. It does this by addressing screening of purchases by majority New Zealand - owned and controlled entities; investments in land that are caught up currently but have little economic, cultural, or environmental value, perhaps because they sit next to, or an example is reserves, like a sports field—sorry, I should say that again. An example is land that sits next to a reserve like a sports field that's currently caught, and there are also a range of small transactions that don't grant meaningful control over or access to sensitive New Zealand assets that are also currently caught which we're removing from the ambit. 
Cutting red tape also means clarifying and simplifying the consent process, including focusing the requirements for assessing an investor's character on the factors that matter most, such as proven serious offences, and requiring applications to be processed to a deadline, giving investors the confidence they need to come here to invest. We're also bringing forward a number of new enforcement measures that were originally tabled as part of the No. 2 bill to ensure that our reforms operate effectively. I won't list them now. 
Recognising that the use of some of the tools could be challenged in court, the bill includes provisions to ensure that natural justice rights and classified security information can both be adequately protected during any court proceedings. More broadly, there's an ongoing piece of work responding to the work by the Law Commission in relation to the use of national security information in courts, and Parliament should expect to see the outcomes of that work at a later date. 
Finally, recognising that the response to COVID-19 is challenging and changing, this bill introduces temporary regulation-making powers that can be used to address transitional issues that might arise. These powers include, for example, the ability to allow modifications or exemptions from the consent requirements while the emergency notification power is in place. 
In conclusion, the bill supports New Zealand's interests at a critical time by increasing oversight of foreign investment while also cutting unnecessary red tape. New Zealand continues to be open for business. Productive foreign investment has been and will continue to be welcome, and I commend this bill to the House. 





Hon PAUL GOLDSMITH (National): Thank you, Mr Speaker. I would like to speak on this bill, the Overseas Investment (Urgent Measures) Amendment Bill, which we've just received. There are elements of this bill that we, clearly, support and understand. The introduction of a national interest test is something that the Australians have introduced, particularly in relation to strategically important businesses that have the potential to have military or dual-use technology. So we understand the need for urgency around that in the context of this incredible economic situation that we're facing at the moment, where over a very short period of time many businesses have been thrown into absolute confusion, with a collapse in revenue and, in many cases, a collapse in value. So we understand the impetus behind this bill. 
We do have concerns about it as well—significant concerns—particularly in the absence of any threshold whatsoever. I struggle to understand how the tranquillity of the Realm and the interests of New Zealanders would be badly affected if a company worth $1 million or less was sold to anybody in particular, and so the absence of any threshold means that what we're seeing, potentially, is sand being thrown in the gears of the flow of investment into this country. Of course, what we've seen in this Budget, only read sort of a couple of moments ago, is that the country has fallen into a massive economic hole, where we've got 150,000 jobs potentially being lost and $140 billion of extra debt, or about $80,000 per household, falling on New Zealanders. So the most critical thing that we need as a country over the next year is to grow, and a growth plan, and we have some criticisms about the absence of a clear growth plan in the Government, which we'll talk about at other times. 
The most fundamental driver of growth and new jobs, if not new opportunities, is private sector investment. If we are to take the view that we will rely solely on domestic investment, then we'll grow very slowly, because there is a limited pool of savings, and throughout the history of this country, if we wanted to grow faster we've relied on foreign investment as well. 
There is a kind of a mood that seems to be sweeping across this Government that all foreigners are to be treated with great suspicion, and we don't necessarily go along with that. We do recognise the need for foreign investment. So the issue with this is that every single investment over these thresholds, whether it's $50,000 or $5 billion, will go through this process. The Minister assures us that it will be swift: 10 working days—well, you know, I don't know. I don't know how confidence—
Hon David Parker: The triage—the triage is 10 days. 
Hon PAUL GOLDSMITH: That's the triage, and if there is a flag flown, then it's up to 30 working days, and that's quite a long time if you're trying to decide whether to make an investment. If you're in a big bad world out there wondering what you're doing, you've got the whole world to potentially invest in and you look at New Zealand and you see these hassles, it may put off some investment that would make a difference. 
So, anyway, I'm relieved that that the bill is going off to a brief discussion with the select committee. On that basis, we're prepared to send it off to the select committee and have some consideration of it, noting our reservations about the absence of a threshold and the potential that it would have to make. At a critical time when we need investment, it could put off some of the investment that we would value and that would actually make a difference in terms of keeping some businesses afloat, because there will be many businesses across this country right now that are in desperate straits that employ New Zealanders, and it may well be that capital and resources coming from offshore might save those businesses and keep them going. If we turn off that tap and if we make it too difficult for that capital to arrive, that could compound the problem that we have with jobs in this country and make the situation worse. That's not something that I think anybody in this House would want to do, and I'm sure the Government doesn't want to do that as well. 
So we recognise the problem that they're trying to solve around the national interest where it relates to security, and we recognise the issue, to a degree, in terms of compressed values through the crisis and the dangers associated with that, but we are very worried about the impact that this would have on jobs and the ability for the country to grow. So I think that covers the issue in the sense that we'll send it off to select committee and have a look at it. We are voicing some reservations, and we hope the Government would be willing to consider some of it—particularly the thresholds—and some of the issues that we'll be discussing over the next few days. Thank you, Mr Speaker. 





Dr DEBORAH RUSSELL (Labour—New Lynn): I wish to take up a few of the points that have been raised by Paul Goldsmith, the previous speaker, because even though the previous speaker has expressed some reservations about the bill, he does zero in on what are the critical issues: how do we ensure that we protect the viable, the good, the solid businesses in this country, and how do we ensure that we continue investment in this country but at the same time, how do we make sure that the assets in this country are not sold at fire sale prices? 
Mr Goldsmith said that we need private sector investment in this country, and he is quite right, but what we do not want is rapine and pillage. We need to get the balance right, and that is what this bill is all about: trying to get the balance right between continuing foreign investment in New Zealand—much-needed and welcome foreign investment—but, at the same time, not enabling all the assets that we have built up in this country through many years of hard work to be sold at a time of great distress. We do not want sales of distressed assets if they are unnecessary at this time. 
So that's the balance we are trying to strike with this bill, and the balance goes a little bit further than that. It's a balance between welcoming foreign investment and shutting it down, and we see this in the bill as drafted that rather than this being the permanent settings that we will have in place for foreign investment in this country, the intention is that this bill has a sunset clause and that the powers in it be subject to regular review. It is in many senses an urgent measures bill but it's also a temporary bill. It is temporary because we would not want to have settings that discourage foreign investment in place permanently, but we do need them at this time. 
So we need to examine whether we've got the balance right on the sunset clause, on how often it should be reviewed. We need to examine whether we've got the balance right on the threshold. Should it be zero? Perhaps. We need to have a think about whether a process of triage really will work effectively. 
The triage idea is quite straightforward as well. It turns out that often it is very easy to make a judgment at one end of the scale that something is completely acceptable and it's easy to make a judgment at the other end of a scale that something is completely unacceptable, but it's the area in the middle that is difficult. The process of triage that the Minister referred to that the Overseas Investment Office will be required to follow to ensure that there are quick answers takes advantage of the fact that the judgments at either end of the scale are actually quite easy to make. It is those judgments in the middle where we will need to review foreign direct investment in this country, and, at this time in particular, we need to ensure that we are protecting the major assets of the New Zealand economy, whether they are held in private hands or public hands. Assets that have been built up by New Zealand businesses are New Zealand assets, and we need to ensure that they are protected. 
So this bill will not stop overseas investment. All it will do at this time is place an extra hurdle—and, at this time, a much-needed hurdle—in terms of investment. 
I'm looking forward to the process in the select committee, where I'm sure that people will grapple with it. It will be an intense process and a very short one, but one that I think will befit this bill. We do need to get something in place quickly, so we will move it through the Finance and Expenditure Committee with due consideration, and I'm looking forward to engaging with the members of that committee in examining this bill and making sure that we get this balance right, as we need to at this time. I commend this bill to the House. 





Hon GERRY BROWNLEE (National—Ilam): It's fascinating, after listening to the Budget speeches from the Government and supporting parties, that the very first bill that we see under urgency in support of the Budget is one to stop a flow of capital into New Zealand. We heard the other day the Rt Hon Winston Peters talking about that ever since 1882 and refrigerated shipping, New Zealand's been a trading nation. We've also been a nation that has been built off the back of foreign investment on our shores. That is an undeniable fact, and here we have today a Government that is making it harder for foreign investment to come into New Zealand because somehow it's being portrayed as a big bogey that takes things away from people. Well, it has contributed an enormous amount to what New Zealand is today to this point. 
I think the speech we just heard from Deborah Russell was interesting. It was almost a continuation of the theme that we heard at the COVID select committee a couple of weeks ago, which was that if businesses are undercapitalised, they just fail—tough luck. The comment here that if a distressed business was somehow sold at a fire sale price, that's a terrible thing to have happen—it misses the point that if that business maybe wasn't sold, it might fail, and if it fails, who loses? New Zealand's local investors lose. The people who have their jobs there lose. The value of that business inside the chain of activity in the economy is lost. 
So there you go. It would seem that we have a Government that wants on the one hand to say they're friendly to business, but on the other it wants to bring in as many rules as possible to prevent individuals making their own choices inside the economy. This bill puts it all back on one Minister. It's a bit like that section 11 stuff yesterday—it all goes back to one Minister. It is a theme coming through strongly that under the cover of doing things for the protection of New Zealanders from the evils of COVID-19 and all its unintended consequences, then we'd better have total Government control on all aspects of New Zealanders' lives. 
So we don't like this bill, and I am looking particularly at the bill that talks about the national security interests. We were told about this bill earlier today, and the SIS and the GCSB have said, "Well, we need to give you a briefing on it." But guess what? Not till tomorrow morning—not till tomorrow morning. So the aspects of that can't be considered by us when we're debating this bill today. 
It's quite an unreasonable position to be put in. Earlier in the day, we got the notification of what the urgency motion would contain. I thought, "That's great. The Government's being right up front with us for a moment, and a little bit transparent." But then, what did we get? A completely different list. 
Right now, we were told we'd be debating a bill that was going to, effectively, make one Minister in charge of all the infrastructure spending—all the Resource Management Act consent stuff that the Government's talked a lot about, that Winston Peters today congratulated the Minister on. But where is it? Not here—not here. Something that might actually, practically, do something to get consents on projects, to move them forward—can't see it, not here. And we know why—we know why—because the Government in its entirety, across its coalition, doesn't have the numbers. So what do we do? We come up instead and put up a bill, followed by another bill that's entirely determined to, for a period of time, they're saying—just a short period of time—close down some of the opportunities for foreign capital to assist businesses through a very difficult time. 
It's not hard for anyone to work out that in a time like this, for many, many companies around the world and many individuals around the world, the concept of capital protection will be very much to the fore in their minds. That's where they'll say, "Well, where do I invest? Where is a place that is safe to invest?", and the Prime Minister gave the answer to that today, in her speech in the House. She said that New Zealand will benefit from being a country that dealt so decisively to the COVID-19 threat and that New Zealand's trade will be enhanced by the COVID-19 threat response. Well, so will New Zealand's reputation for being a safe place to invest capital, and—I've circled back to where I started—the capital that has built this country over decades, since 1882 and before. 
So we're very disappointed that the Government is bringing in these measures. I don't think there's too much need to say an awful lot more. We want to see it go to a select committee so that some of the foible of it can be exposed as it is discussed by those who submit to that committee. It's only a very short time—incredibly short time—but, as we've learnt, it's an unusual thing for any bill under this circumstance to go to a select committee. So what I would say is that we will support it to that select committee, but with very severe reservations and deep concern that at the one time when New Zealand might have been wanting to make it a little easier for some companies to bring in—some companies. Remember, when we say "companies", for some employers—some places of New Zealanders' work—to be able to get the capital to maintain those jobs and to maintain the trade that goes from the productive output of those jobs could've been made a little bit easier. This does not do what the bill claims in its purpose to do. 





Hon TRACEY MARTIN (Minister for Children): Kia ora, Madam Speaker. So I rise on behalf of New Zealand First to speak to the Overseas Investment (Urgent Measures) Amendment Bill. The contribution by the member who just resumed his seat, the Hon Gerry Brownlee, was an interesting one. He put forward a proposition that suggests that never before has there been urgency after a Budget, never before has there been bills placed on the Table for the Opposition to see just after the Budget speech has been made, and never before has the Opposition actually had to get up and go and do work really, really quickly for the benefit of this House. Having sat in those seats, it is with some irony that you listen to that particular member, knowing how often it was used and how often we would see a paper with something like five minutes beforehand. But, you know, I understand what it's like in Opposition; and so you build an argument and you rewrite history. 
New Zealand First supports the bill. The bill contains measures which the coalition Government considers need to be put in place urgently to mitigate the economic effects of COVID-19. It should come as no surprise that the Opposition—well, at least one of the Opposition—speakers have already argued that we should open the borders to whoever wants to come in and buy us. It will be no surprise to anybody listening that New Zealand First, who has always stood for investment and who has always understood and acknowledged that some of that investment will come from offshore, refuses to accept that everything we have and everything we are should be up for sale to somebody else, and particularly at this moment. 
So the bill's purpose is to ensure that the risks posed by foreign investment can be managed effectively, while reducing the regulatory burden of the screening process to support the role of productive—and there is an interesting word. There is the key word. New Zealand First and the Rt Hon Winston Peters have articulated it before—that any such investment from offshore must enhance New Zealanders' futures, and not just the profit margins from those offshore and line their pockets. It must be productive foreign investment in our recovery. In particular, we need to minimise the possibility that cornerstone businesses in our productive economy are sold in a way contrary to our national, long-term interests while the pandemic is causing the value of many businesses to fall. 
Mr Brownlee said that this was putting in roadblocks. Inside this piece of legislation, and of equal importance, is the need to attract productive foreign investment to support our recovery. As a result, this bill brings forward some measures to cut red tape. I would have thought the Opposition—I think they rolled out a series of speeches about cutting red tape—would have celebrated this particular part of the legislation. 
Cutting red tape means encouraging investment by reducing the number of low-risk transactions unnecessarily caught by the Act, including the screening of purchases by majority New Zealand - owned and controlled entities, investments in land that has little economic, cultural, or environmental value because it sits next to a public park or sports field, and a range of small transactions that do not grant meaningful control over or access to sensitive New Zealand assets. Cutting red tape also means clarifying and simplifying the consent process for the transactions that will continue to be screened with longer-term changes, including focusing the requirements for assessing an investor's character on the factors that matter the most, such as serious proven offences, and requiring all applications to be processed to a deadline, giving investors the certainty and confidence they need to come here to invest. 
New Zealand First understands that we require investment on our way out, but we will not sell our souls to get there. We support the bill. 





Hon JUDITH COLLINS (National—Papakura): Oh, thank you, Madam Speaker. Look, I just wondered if that member who's resumed her seat has even read the bill that she's supposedly spoken to. It sounded more like a campaign speech from New Zealand First from 2002, when they went all over the country telling everybody that the Government—and that was the Government that they were part of—was allowing land to be sold to foreigners. I have no idea where those foreigners were taking that land, but, apparently, they were. Of course, the issue then, in those days, was not the usual bogeymen for the New Zealand First Party of the Chinese investor, but, in that case, it was the American investors, because they were the bad people in those days. 
I think it's very important for the Parliament to consider one of the other comments made by the member who's resumed her seat, and that is that she said that there's a lot of people who are going to, basically, go broke in this country—
Hon Tracey Martin: No, I didn't. Don't mislead the House. 
Hon JUDITH COLLINS: —there are a lot of businesses that are going to find it very hard, and there's not much capital floating around. I think that's a very good paraphrase and a very fair thing. 
Hon Tracey Martin: I didn't say any of those things, actually. 
Hon JUDITH COLLINS: Well, she's now denying she's said that, so, obviously, she thinks there's lots of capital floating around and there's lots of people who aren't going to go broke. Well, I've got some news for the member who's resumed her seat, and that is that that's actually pretty much the whole world at the moment. So there is not a lot of cash floating around the world or looking for a home to be in, and that's one of the problems that we've got in New Zealand. 
So this is legislation very much modelled on the legislation from the Liberal-National Government in Australia, which, of course, went to the extent of forming a grand coalition to deal with the COVID-19 situation, unlike the current Government in New Zealand. I think one of the things that they've said there was that they were worried about fire sales, as well, of Australian assets which are really productive assets, and people can understand that. I can understand that people feel very frightened that this is going to happen. 
One of the problems that we have is that we have a lot of small and medium sized businesses in New Zealand, and we have some larger businesses too, that will actually end up closing if they can't get investment. It's all very well to rail against the foreign-owned banks—as the member who's resumed her seat often does, through her party—but, actually, it was the foreign-owned banks that helped get us through the global financial crisis, as well as a very good National-led Government. 
But I think it's really important to understand that people do have concerns that there may be situations where there can be a New Zealand investor in interests and businesses, but you just need to be very careful about who is this New Zealand investor. Is it going to be some form of State control and ownership of everything that's productive? Who is going to take up the slack that's going to be left? So what's going to be the—
Hon Andrew Little: We're not going to have the dancing Cossacks, surely? It's not the dancing Cossacks, again—please. 
Hon JUDITH COLLINS: The Hon Andrew Little says it's not going to be the dancing Cossacks. Well, I'm pleased that it's not going to be the dancing Cossacks, because, I must say, it might be time to bring them out if it is. But it is important to consider that this is a very genuine concern. We certainly would never, on this side, talk about the dancing Cossacks, but if the member really wants to, I am happy to do that all day long—if he really wants to. 
But it is important to understand that if someone is to have a New Zealand business and they need capital, what are they supposed to do? The Government says you can borrow it. Well, what if there's not enough asset value there to borrow against, or if there is not enough income to pay the bills? These are the issues. So does that then mean that the business would have to actually close, and the answer would be yes, because, of course, they would be trading insolvently, in many cases. So there are issues here that we need to be very careful about. 
We have, in the National Party, not seen this bill until really, effectively, now, and we have not been able to go through it as a caucus yet to consider the ramifications of it all. So we have decided, because we are aware of the concerns that will be out in the community about a fire sale of some of the big New Zealand assets where the Government's interventions may, in fact, have harmed those assets, that we do need to consider whether or not something of this bill can actually be saved in select committee. We are assured by the fact that it is going to a select committee, which is better than no select committee, unlike some legislation these days, just passed recently—in fact, yesterday—and what I would like to say is that in the select committee, we're going to be asking some very hard questions around the fact that there seems to be no limit, no threshold, where there is this intervention. 
That's something, I think, of great concern to people. If it's a big, billion-dollar thing, people might then consider it. But also, what if it's an asset that's of a million dollars or half a million dollars, which actually, to be frank, is about the price of a house? 
So we do need to be very careful. We will look at this very genuinely in the select committee and we will look to see if we can find some way in which to support it further. But we give no guarantees whatsoever other than to treat it in a very serious, sober, and careful way. 





KIRITAPU ALLAN (Labour): I just had the joy of googling the dancing Cossacks, and so I have now, for my benefit, just had a very interesting political history lesson. So I thank the colleagues on the other side of the House, and I look forward to watching that full YouTube clip in due course. 
This House at the moment—we are all living through a particular period of time that calls for extraordinary measures, and this is indeed a bill that is very necessary right now for our economic security. It's not lost on all of us the significance of what kind of economic stimulus will be required over the next, not just short period of time, but quite some time. Globally, we can see, internationally, markets are dropping all over the place, so this here is a very necessary measure to ensure that New Zealand's economy is protected. It is specifically to aid in our recovery. Stepping back, something that I think both sides of the House can agree on is that for a very long time, New Zealand has needed a national interest test. 
Now, I note that my friend the member from Ilam made some comments about not being able to see anything, and this, that, and the other thing. Well, some of the measures in this bill are measures that I understand they were offered a briefing on just prior to COVID intervening and stealing the thunder. So I do know that there have been attempts, at least from this side of the House, to enable our friends from across the aisle to have a detailed perspective. So I wanted to put that on the record. 
We are living through extraordinary times. It calls for extraordinary measures, and this bill here, the Overseas Investment (Urgent Measures) Amendment Bill, is to assist us to do just that. I commend this bill to the House. 





Hon TODD McCLAY (National—Rotorua): Madam Speaker, thank you very much. I'd like to say it gives me pleasure to speak in this debate, but it's hard to do so when one considers the ramifications of what this Government is trying to push through, again, one assumes, in a very short-fashioned way. 
New Zealand is a country that relies upon foreign direct investment. Without it, our economy cannot grow. There are few parts of New Zealand that haven't benefited or don't benefit from the investments that come from overseas. It is right that we have rules around how this money comes into the country, the conditions with which it can be invested, and rights and obligations on all sides, and every Government, for periods of time, have grappled with how to get this balance right. 
However, for this Government now, under the guise of a Budget with the considerable economic harm that's being done to the country through COVID-19, to bring this bill forward and say that they believe it's in the best interests of the country, having delivered it to us only just now—and again we find a chance where they rush things through, and haven't we seen over the last two weeks how wrong they can get things when they rush things through? The wrong tax bill was passed into law in two hours, but the Prime Minister couldn't meet her promise to New Zealanders of almost a month ago and bring forward a bill to reduce her and colleagues' salaries by 20 percent in, say, one hour. 
We now have this bill that may have considerable effect upon the view of people overseas who are responsible, legitimate investors that have an interest in New Zealand to come here and to invest to do so. The reason I say that is when we get investment from overseas, if it's done in the right way, it creates jobs, and what we've heard is that the country needs jobs at this time more than anything else. 
The Government needs to be focusing on saving jobs sustainably and focusing on creating sustainable jobs. I think that what we will see with the announcement of the extension of the wage subsidy for eight weeks for some companies is an ongoing masking of what's really happening in the economy and the degree to which unemployment is going to increase. The reason for that—
Hon Tracey Martin: Would the member stop that subsidy? 
Hon TODD McCLAY: Well, it's one thing to sit there and chirp a little bit—it's one thing to chirp a little bit when you've just spoken—but the great thing about this Parliament is it is an opportunity to have a debate. You've had your chance, and how about someone else has a chance now? 
So the point here is that that subsidy has been welcomed by the National Party, and it has helped New Zealanders in their time of need. What it will now do is allow a number of companies to keep those New Zealanders on their books as they try to see what will happen to them in the coming period of time. It's a good thing for those individuals. However, that is not enough, unfortunately, to keep New Zealanders in work, and what it is likely to do is mask the level of unemployment that is coming. It puts it off for a period of time for those people that get to keep their jobs during that period of time. That's an important thing, but what I'm actually talking about is every time we get a responsible foreign direct investment in New Zealand, jobs are created, and they're not created by the Government and they're not created by the taxpayer. The Government and the taxpayer then has taxes to spend on other things that can be better used in the economy—health and in education—and in this case, what we're seeing is legislation before the House that is not likely to create more jobs. It's likely to restrict the private sector creating jobs at a time when the Government are also using taxes to support jobs directly. 
That's the reason that we need to take some time to really understand this and have a very good, close look at it, because, again, it's another piece of legislation that is just dumped upon us. But we've had every speaker in this debate in the Parliament earlier stand up and talk about what we need to do for New Zealand to get it back on its feet. Well, actually, backward-looking legislation—restrictive legislation when it comes to making things more difficult for business in New Zealand—is not about moving forward; it's actually about going backwards. 
We've also heard that there is funding available in the Budget for exports. The thing about exports is it is also about attracting investment to the country. So on the one hand the Government is spending hundreds of millions of dollars to help New Zealand companies do better overseas and to be able to find ways to diversify and sell more in markets overseas, and, in fact, it's no different than every other Budget we've seen from any other Government. We did it when we were in Government. We made sure that there was support for an export economy because we are an export nation. But at the same time, we then have this legislation brought forward which creates more restriction, not less. It's not about actually opening the economy up in a way, responsibly, that creates jobs and gets the economy growing; it's about making it more difficult, more cumbersome, and more costly to be involved in the New Zealand economy and to invest in the New Zealand economy, and I just wonder why. 
I just can't understand or comprehend why the Government would do that at this time, when every single business person in New Zealand and every single employee in New Zealand wants to go back to work, wants to look for more markets, and wants to find more investment, but doesn't want more debt and doesn't want more borrowing. They want more customers. They want to partner and they want to have people invest in the productive parts of New Zealand, and this bill makes that more difficult. In particular, it's because it creates rules that the Government get to use themselves that we will find as this debate goes forward will make no sense at all, and they're not likely to make a lot of difference to the investment regime in as far as, actually, what is allowed and is not allowed, I suppose, but it will create great complication and great cost for those in New Zealand who find investment and for those overseas who want to responsibly invest in New Zealand. 
I think what the last speaker in this debate needs to do, if she takes another call, is to explain very carefully why they don't like foreign direct investment, because that's very much the message that is sent. Is it just about the foreigners? If we just called it direct investment, would they be in favour of it? If they just called it direct investment, would they be in favour of it, because what we've heard time and time again is the reasons why they don't like people investing in our economy. 
That's the big problem that we have from this Government: the signals that they send around the world about whether or not New Zealand is open to the right type of investment that will grow the economy, that will produce things that we might not otherwise, and that, at the same time, will create jobs for New Zealanders, and the signal that's being sent by this legislation, and that last speech and almost every other speech that we've heard from the Government, is "No, we don't want to be a welcoming economy. We don't want people to feel that they can come here and investment.", and, at the same time, that means they don't want the private sector, in partnership with others, to create the jobs. I think they believe it is the Government's job, and sole job, to control that and to do that. 
We will have more opportunities to talk about this in the coming period of time, but I ask the Government to take their time and to reflect, and not to rush because they think that when a Government passes legislation quickly, they are seen to be a hard-working or responsive Government. That's certainly not what we've seen over the past weeks, when they introduced the wrong legislation to the House and passed it in short order in two hours, and then went out and announced it as if it was actually meant to have happened and it wasn't a problem. 
That's the reason that this House should take the time that sits in the Standing Orders to get things right. When there is a need for urgency, we should do things urgently. Often, when things need to be done urgently, two sides of the House join together to do that, but we shouldn't be using urgency for the sake of rushing things through just so we can be seen to be doing something, and this legislation should take its time. 
Hon Gerry Brownlee: A $140 billion Budget, and this is it. 
Hon TODD McCLAY: That's right. Well, there you go: a $140 billion Budget, and the first thing they do is say that we don't want to create jobs through foreign direct investment. If you get that wrong, it'll have to be a $141 billion - debt Budget—
Hon Gerry Brownlee: Where are they borrowing the money from? 
Hon TODD McCLAY: —because, actually, Mr Brownlee, it has to come from somewhere else. 
That's a good point, and a final point: when it comes to foreign direct investment, the $140 billion—that's $80,000 per household in New Zealand. That's one heck of a second mortgage that this Government has to borrow—
Hon Tracey Martin: Run out of material. 
Hon TODD McCLAY: I ask the Hon Tracey Martin, where will that come from? Where will that come from? Will it come from overseas? Will it come from foreigners? Will it come from people overseas who, through their banks, decide that they will invest in the Government of New Zealand, or will it come from, actually, hard-working New Zealanders? 
The one thing I do know of that $80,000 per household additional debt is it will be paid back through higher tax rates on the part of hard-working New Zealanders. 
ASSISTANT SPEAKER (Hon Ruth Dyson): I understand this is a split call. 





Dr DUNCAN WEBB (Labour—Christchurch Central): Thank you. Look, despite the flailing around there, it's good to know that the National Party is going to support this excellent piece of legislation through to a select committee, because we actually do agree on that thing. If the member had listened, he would have known that on this side of the House, we are absolutely in favour of sustainable, long-term, high-quality foreign investment. But in these extraordinary times, values are volatile and in some cases they are tumbling, and the existing threshold of $100 million just isn't right. 
Now, we have seen businesses which have some real, fundamental strengths and strategic importance, and the risk is that their values will plummet. The hyenas are circling around the fire, and on this side of the House we say no, we will not allow them to tear, limb from limb, the jewels of New Zealand industry and business. We will wait and we will support those businesses, and if people want to come to this country with good money to invest in the long term to support New Zealand, we welcome it. But we will not be the victims of international scavengers. 
This, however, is an extraordinary measure. It's not here for ever. That measure in particular is here for the time being—while those market conditions are extraordinary. So once those market conditions settle down and once the economic conditions return to normality, those provisions will be set to one side and will not be being used. 
So that's why this is a good bill. I look forward to sitting on the select committee, having a robust discussion with my friends from the National Party, and seeing this through to becoming yet another plank in our response to the COVID-19 crisis. Thank you, Madam Speaker. 





ANDREW BAYLY (National—Hunua): Thank you, Madam Speaker. It's a pleasure to be talking on this new bill, the Overseas Investment (Urgent Measures) Amendment Bill. If I recall and understand what the Minister said when he introduced the bill, this bill is basically about stopping fire sales of businesses in New Zealand and, with that, the loss of intellectual property and jobs overseas. I think that at a high level, there is merit in that argument, for sure. However, what I find slightly disconcerting is he then went on and used the term "triage", and, to me, that has a rather negative connotation about the way you look at approval of foreign investment. It implies a negative connotation, and I think that is wrong. We are talking about foreign investment in New Zealand, and, as many of the speakers have noted previously, it has been very beneficial for New Zealand. 
I think the big issue here—and this is what the crux of this bill will be about—is there are good forms of foreign investment and there are poor forms of foreign investment. In the main, there are many good types of foreign investment, and the classic I want to talk about is, for instance, if a company is in trouble—and we've seen the Auckland Airport do a significant rights issue recently. If that company wants to get fresh equity so it can recapitalise and grow its business or expand its business, that is fine, and that type of foreign investment should be allowed. What worries me in this bill is that all the good stuff and the bad stuff is going to be put together into one little box and pushed through the Overseas Investment Office (OIO) under strict requirements to do it within 10 days, and also the whole processing at 25, 50, 75, and 100 percent takeover—each of those thresholds just double up the requirement to be able to make that happen. 
The other thing is it, obviously, builds on this issue around the national interest test and the call-in powers. No one's mentioned it yet, I don't think, but the national call-in powers and the national interest refer to industries such as national military or security companies, telecommunications, electricity, ports, airports, financial institutions, and, of course, the media. Those are the types of categories that these provisions will relate to particularly. 
I think that in terms of looking at this bill at the select committee, the first thing is making sure that its focus is very, very confined, because if it starts to impede businesses who are currently in trouble, and who need capital and can't get that capital other than going locally, then that's a real issue. This bill, actually—what it's done is hung out a shingle to many people from overseas to say "If you want to do it, even though you're going to be fast-tracked"—supposedly—"under this system, you will have to still go through quite a rigmarole.", at a time when New Zealand companies need that money quickly. So the focus will be around its purpose and scope. 
The second thing is around the definition of the national interest, because I think it says in the bill that the Minister can "impose conditions on, prohibit, [and require disposal] of investments". So it's quite wide-ranging powers. 
The third issue is the definition and scope of the call-in powers, and I think that will need a lot of work on it, because that is a heavy-handed right. The fourth thing is the capacity of the OIO. If you talk to any lawyer who has been involved in OIO processing—and I did, recently—they will normally say that the process for doing foreign investment in New Zealand is time-consuming, and my first question is we're now doubling up on it, requiring it at 25, 50, and 75 and 100 percent thresholds. That means the resources of the OIO will need to be resourced. I don't see anything in the Budget for that, and so how that's going to be done is another issue. 
The other issue is the approval by one Minister. This is, again, a heavy-handed approach—and whether that's appropriate—and, finally, the criteria when these emergency powers should be disbanded or discontinued will need to be addressed. 
All of that means that we've got a lot of work to do in a Finance and Expenditure Committee meeting over the next week. I'm just wondering who's going to turn up as submitters. I don't think we'll get any foreigners, because they'll see this bill and think they won't want to go near it. 
ASSISTANT SPEAKER (Hon Ruth Dyson): The next call is a split call. 





DAVID SEYMOUR (Leader—ACT): Thank you, Madam Speaker. I rise on behalf of ACT in opposition to these bills. The history of New Zealand is a history of foreign investment, and, if you doubt that, let me tell a story. In the beginning, there was no foreign capital in New Zealand, and then Kupe showed up with his waka hourua and a few kunekune pigs. That was the start of importing foreign capital, and we've never looked back. 
There are two reasons why that matters: first of all, capital is important for jobs. A job without capital is called a labourer. I've been a labourer in parts of my life, and even the proudest labourers will tell you that if you don't have capital, you can't earn much money. So capital is important for raising wages. The second point is that there's a lot more capital overseas than in New Zealand. That's why our history is a history of foreign investment. 
But it's a funny old thing that New Zealand is an outlier amongst democracies, because most of the xenophobia is on the left. Never forget it was our Labour Party of the Chinese-sounding names publicity stunt, and it was our left-wing Government that introduced the oil and gas ban that has investors around the world scratching their heads, saying, "Do these guys want to be part of the First World and the 21st century or not?" Then came the Overseas Investment Amendment Act at the beginning of this Government that further sent the message that this country wants to replace Fiji as the largest group of Pacific Islands. 
This bill makes worse a situation where New Zealand is among the most hostile destinations for foreign investment in the OECD, and the Opposition—I say, how they don't know that? They don't know that it's almost easier to invest in Indonesia or in Saudi Arabia than it is in New Zealand, and it needn't be so. I say to the xenophobes that if you don't like foreigners, foreign investment is for you. Why? Because immigration is when foreigners come and live here; foreign investment is when they stay home and just send their money. Even the most xenophobic parties in this Parliament should think that's a good deal. 
So this bill comes along and, at precisely the time when New Zealand businesses are going to be desperate for investment capital so they can keep going and keep jobs going and maybe hire more people, this Government is introducing legislation, as the first Act of this Budget, that makes it even harder for foreigners to send their capital to support businesses and help jobs. The greatest irony of all is that in this Budget, this Government is borrowing $140 billion, and, if it's not the $60 billion that the Reserve Bank is just going to print, it's the other $80 billion that's going to come from offshore. So the Government is importing foreign capital, but the private sector can't. How crazy is that? 
That describes the problem with this Government. It is trying to manage the economy from the Beehive, and that's inadvisable for any Government, but especially foolhardy for the Government that gave the world KiwiBuild. It is now trying to rebuild the whole economy. Phil Twyford's going to be there with his high-vis vest and his hard hat, trying to rebuild more than just the cluster that he had with KiwiBuild and houses. They're going to KiwiBuild the whole economy. 
That's why New Zealanders should be concerned, and that's why the ACT Party, the only party consistently standing for a free and open economy in New Zealand, is proud to stand alone in this House in opposing this myopic, inward-looking, backward build. Thank you, Madam Speaker. 





JAMIE STRANGE (Labour): I'm delighted to take a call on this bill. If there was ever a bill that highlighted the difference between the Opposition and the Government, it's this bill, because we've heard speeches from the Opposition who want to sell out New Zealand—who want to sell New Zealand - owned firms overseas. What we're saying is we need to keep New Zealand businesses for New Zealand. 
We've got a Government here who are taking a long-term view, because the reality is when the businesses are sold, they're sold. When they're gone, they're gone. Somebody once said, "We don't want to become tenants in our own land." I wonder who said that, and I think the Opposition members should think about that—we don't want to become tenants in our land. 
It's appropriate that this bill comes first after the Budget, because the crux of this bill is about protecting New Zealand interests. There's been a growing sense of pride in New Zealand in terms of our response to COVID-19 and within that growing sense of pride there is a sense that we need to keep New Zealand for New Zealanders, and that's what this bill does, in a balanced, practical way. I'll be interested to see how the Opposition vote after a few more speeches, because I expect they will vote for this bill. 
There's another point I haven't heard raised in this debate, which is that Australia, Canada, and a number of European countries have recently strengthened their foreign investment regimes. Are the Opposition recommending we get out of step with those countries, because as a Government, we believe it's important to be in step with some of our good friends, the likes of Australia, Canada, and some of those European countries. 
So the point is that here we have a Government taking a long-term view, keeping these businesses in New Zealand for the long-term benefit of New Zealand. I commend this bill to the House. 





Rt Hon DAVID CARTER (National): It's a pleasure to follow that contribution from Jamie Strange, realising that xenophobia is alive and well on the other side of the House. Let me be quite clear to that member as to how National will vote: National will vote to support it to the select committee, but gives no guarantee that we'll support it after the select committee process. We've decided on that course of action because this is a complicated piece of legislation delivered at a time of crisis in New Zealand, and we accept that. But I think comments from Jamie Strange like "We don't want to sell out New Zealand to strangers." send all the wrong signals at this time. 
The first piece of legislation that we're rushing into this Parliament after the most serious Budget that's been presented in my lifetime, potentially, sends all the wrong signals to the investment industry right throughout New Zealand and internationally. It sends the signal that New Zealand is closing its doors. 
Now, I listened very carefully to the Hon David Parker as he introduced this legislation, and he talked about the need for it to protect those strategic industries that may be vulnerable because of the economic crisis of COVID-19—industries associated with the military, with the ports, with airports, perhaps electricity, perhaps even the media—and there is some justification for needing to make sure that those industries, who may become fragile and vulnerable, are recognised as strategic industries and are, therefore, subject to a strong regime and tests around foreign direct investment. But what Mr Strange didn't realise with his contribution is that New Zealand already has a very, very strong regime around overseas investment. 
The Hon David Parker talked about a threshold existing in the current regime of $100 million. Well, if the ports of New Zealand and the airports of New Zealand are now going to collapse to a value below that, and I certainly hope that's not the case—but if it is, think seriously about adjusting that threshold. But the way I read the legislation, this means all foreign investment comes under the scrutiny of this new bill. I want the member opposite to consider Queenstown as it is today—desperate for jobs. I will guarantee before too much longer there will be a motel unit there, perhaps, of 20 or 30 units that will go bust and, potentially, it could have been sold to an overseas investor and saved a lot of jobs. But that particular threshold now means that that distressed business—a motel of 30 units, potentially—is considered strategic under this legislation and goes through yet another hurdle, if indeed this doesn't chase off the potential foreign investor buying that. 
What this country needs now more than at any time is business confidence, because confidence equals jobs. The Prime Minister delivered her Budget speech and talked about the Budget being a Budget for jobs. Well, think about that distressed motel owner currently in Queenstown, potentially, with a staff of a dozen people, who is about to go bust and wanting to find a way of getting some fresh capital into that business to keep those jobs there. This legislation threatens that. 
I listened, particularly, with fear to the Budget speech from the Rt Hon Winston Peters, and he spoke with his normal xenophobic nature against foreign investment, spoke against the reforms of the 1980s—which I think were the saviour for the New Zealand economy—and spoke against foreign investment. He was the man who, three years ago, campaigned against any foreign investment into New Zealand's second-largest meat-processing company, Silver Fern Farms—a company which was so vulnerable, it potentially could have tipped over—and, finally, there was some investment. Yes, it was foreign investment. It happened to be Chinese foreign investment, which will really worry the xenophobes on the other side of the House, but that company recently returned a $70 million profit and will pay tax to the Government. That's what foreign investment can do. 
So let's be grateful that the Government will send it to a select committee for a short period of time to give us a chance to really examine the detail of this. But I can't help thinking there were far easier ways to construct legislation that wouldn't look as if New Zealand was closed for business and that wouldn't turn people who have investment money, who are interested in New Zealand, off from considering New Zealand and send them to other opportunities that exist in countries like Fiji or Australia, because jobs are important. That's what we need at this time. 
So I say to the Minister that the select committee will examine the legislation. I warn the Minister that there is no guarantee that as the legislation comes back from the select committee, National will continue to support this legislation. I personally think it's complete overkill and it sends all the wrong signals to our business community at a time when they're asking for confidence in the Government. They're asking for a Government that knows how business works, because this legislation suggests to me that many on that side of the House have not a clue what actually makes a business survive. 





Hon EUGENIE SAGE (Minister of Conservation): Te Māngai o Te Whare, tēnā koe. The Greens are pleased to support the Overseas Investment (Urgent Measures) Amendment Bill. Like all countries, New Zealand relies on overseas-based investment to contribute to economic growth. It can improve productivity, it can enhance export opportunities and improve employment, and it also brings new ideas, innovation, and relationships that connect us with the world. We want to be seen as an attractive place to do business where we get overseas investment which promotes a sustainable, productive, and inclusive economy, and we welcome that sort of investment. 
But it's also a privilege for overseas persons to own or control New Zealand assets. That is why one of the first things this Government did was to strengthen the ministerial directive to the Overseas Investment Office to close the loopholes that the National Government had opened so wide that it saw large areas of rural land being sold offshore. It was why one of the second things this Government did was the "one home to live" test, to reduce and avoid overseas speculation in our housing markets. We want overseas investment where it generates a sustainable, productive, and inclusive economy. 
But in a COVID-19 world, which the Opposition doesn't seem to recognise, there will be a major change. There will be businesses that become distressed, that are likely to fail, and that are significant businesses in the New Zealand economy. 
David Seymour: And now they won't have any capital. 
Hon EUGENIE SAGE: And it is wrong, Mr Seymour. If Mr Seymour read the bill, he would find that there are changes that streamline the way in which applications can be considered. One of the changes is to reduce the screening when low-risk investment is wanted by New Zealand companies and they want to access that lending from overseas. So it is making the Act more streamlined and the processes more efficient. 
But there are distressed businesses which are a cornerstone of our tourism sector. We do not want those passing into overseas hands at the moment, if it is just because they aren't able to do business at the moment. So that is why it is absolutely critical that we—as Australia has done, in reducing the threshold for screening to zero, in a COVID era—are doing that with this bill. It is for an emergency period only. It won't last for ever, but it is intended to ensure that critical New Zealand businesses which are finding it difficult don't end up being totally overseas-owned just because of that economic distress. 
So the changes in this bill are part of the Government's whole business response package. They're ensuring that we've got the right checks and balances to protect businesses that are important to our national security, our economy, and our communities. The changes that I mentioned earlier in terms of streamlining, they will enable applications to go more quickly through the process, because the Office of Overseas Investment—contrary to what some National members have suggested—has been working to improve its practices significantly. It has been reducing the times required for applications to be considered and decided but has also sought to ensure that we recognise the privilege of owning things like rural land in New Zealand. So these lower-risk transactions won't need to be screened and the application processes for remaining applications will be simplified. 
In this whole area of a national interest test, that is to recognise that on this side of the House, we have significant infrastructure in the telecommunications space, in the technology space, and if it's advising on national security issues, that it is in the national interest for applications to purchase those companies to be considered. Really? But the ability for the Ministry of Finance to consider those and see whether they're purchased by overseas interests is actually in New Zealand's national interest. So that is what this bill does. It provides the screening of any application to buy more than 25 percent of a New Zealand company by an overseas person, or to increase the investment stake by an overseas person beyond 50 percent, for this emergency COVID period. Then, when that is over, there will be this national interest test, which means applications will be screened, due diligence will be done—and, as Minister Parker noted, that will be done relatively quickly—and then, if needed, the Minister can intervene. 
Also, to counter some of the points made by the Opposition, five years ago, the Overseas Investment Office was very poorly resourced. In Budget 2018-19, there was additional revenue provided to the office—particularly to work in the enforcement space—because under the previous Government, we saw very little action taken against those who broke the law. With more resources, there's been more effort here, and what we've seen is a significant increase in the enforcement actions to ensure that the law is complied with. In 2014-15, there were three enforcement actions. In 2019-20, there were 43. This Government is about sound law, and then ensuring that law is enforced. 
One of the other parts of the bill that Opposition members may be interested in is the issues around character, because, currently, if an overseas investor wants to acquire sensitive assets, the investor test must be satisfied. That means that an investor's character, capacity, and capability are assessed to ensure that they're not likely to act inappropriately or bring New Zealand into disrepute. Currently, that investor test requires a large amount of information to be reviewed. It's time-consuming, both for potential investors and applicants and for the Overseas Investment Office, and that test only looks at the character of individuals, the directors, and those who control the company. What the bill is doing is ensuring that there is a simplified investor test, and it looks at the character of corporate entities and not just individuals. That should reduce the amount of information that is required and make the whole process much more streamlined. 
So, in terms of the emergency measures, the simplification of some of the processes, and also the national interest test, we are ensuring that we protect the key parts of the New Zealand economy while also ensuring that the door is open for overseas investment, which assists in making a productive, sustainable, and inclusive economy. I commend the bill to the House. 





ASSISTANT SPEAKER (Hon Ruth Dyson): The question is that the motion be agreed to. Those of that opinion will say Aye, to the contrary, No. The Ayes have it. A party vote has been called for. I'll ask the Clerk to conduct a party vote, please. 
Hon GERRY BROWNLEE (National—Ilam): Sorry—my apologies. Excuse me, I know we're not meant to do this—this happened yesterday, too. Look, I don't normally call the votes, and I shouldn't have this time, because, in fact, the National Party has consistently said we do want to see this go to a select committee, although we have our reservations. So I apologise, but I need to correct our vote. 
ASSISTANT SPEAKER (Hon Ruth Dyson): Thank you. I totally accept your apology, Mr Brownlee. Mr Seymour called for a party vote, so I'll ask the Clerk to conduct a party vote. 





A party vote was called for on the question, That the Overseas Investment (Urgent Measures) Amendment Bill be now read a first time. 
Ayes 118
New Zealand National 55; New Zealand Labour 46; New Zealand First 9; Green Party of Aotearoa New Zealand 8. 
Noes 1
ACT New Zealand 1. 
Bill read a first time. 
Bill referred to the Finance and Expenditure Committee. 





Hon DAVID PARKER (Associate Minister of Finance): I move, That the Overseas Investment (Urgent Measures) Amendment Bill be reported to the House by 25 May 2020 and that the committee have authority to meet at any time while the House is sitting (except during oral questions), during any evening on a day on which there has been a sitting of the House, and on a Friday in a week in which there has been a sitting of the House and outside the Wellington area, despite Standing Orders 191, 193, and 194(1)(b) and (c). 
I suggest to the House that this is necessary because we're in the midst, internationally, of a depression caused by COVID-19 that is predicted by many to be of a scale not seen since the Great Depression. The current regime for screening assets has no national interest test. It has only a freedom from corruption and ability to manage an asset test, and even then, those tests only apply to investments for most countries of $100 million or more; for investors from Comprehensive and Progressive Agreement for Trans-Pacific Partnership countries, $200 million; and for Australian investors, $500 million. So they're very high thresholds and we think that with those high thresholds, in the absence of a national interest test, we need some more levers, and we think that this risk justifies progressing this through a shortened select committee process. 
Many aspects of the bill will be enduring. The national interest test endures, albeit it with that higher threshold, but none the less we think that the interim measures justify a shortened select committee period. 





Hon GERRY BROWNLEE (National—Ilam): We don't think that that's a reasonable thing at all. This is a very important bill. Every speaker that's spoken so far this afternoon, including Government speakers, has been at pains to point out how important it is, and I think one week or, effectively, about three sitting days—or would-be sitting days'—time for officials, firstly, to get people to submit, and, secondly, for those people to be heard, even though we can now do it by Zoom and other such ways, and then for the report to be put to the House, is pretty unreasonable. If we look at some of the contradictions in the views on this bill today, it does show that there does need to be a select committee process. 
I can appreciate some of what the Hon Eugenie Sage had to say. I don't agree with most of it, because I have a different view about what the effect would be of any particular action, and I think it was very interesting and instructive that the Minister who just took his seat—the Hon David Parker—mentioned that we have pretty large thresholds with some countries that have been negotiated through the free-trade agreement arrangements. Now, one of the things that he immediately followed with is that we think we therefore need some more restrictions. Well, what does that do to those trade agreements, and in a time when we are desperate to maintain trade and desperate to maintain investment in business in New Zealand? Let's be clear: trade and investment is about jobs; nothing else. You cannot say "jobs, jobs, jobs" if there isn't a big focus on trade and investment, and I think the need for the public to understand that the Government is somewhat confused in the way it's going about things is essential. So it is completely unreasonable that we are being restricted to just a one-week arrangement. 
I'd like to amend the motion by the Hon David Parker in a reasonable way so that the report-back date for the committee is amended to Monday, 15 June. Now, that gives a full recess week next week, a couple of sitting weeks, and a recess week to get it back, and I think that would enable sufficient time or enough people to be able to come along to, well, firstly, get the bill—firstly, get hold of the bill—and read it and work out what it means for them. Just think about what it must be like if you are one of those people in Queenstown—the motelier that the Rt Hon David Carter talked about—with 30-odd rooms in probably a $7.5 million, $8 million, or $10 million complex. It has no occupancy at the moment, but it is a good asset, but it has a huge debt sitting over the top of it, probably to a bank here in New Zealand, and there is the need to either bring in an investor or to sell it to someone who can afford to sit on it for a long time. 
I spoke earlier about the value of New Zealand accepting the Prime Minister's proposition put to the House today that we will become a desirable location, perhaps not only for people to come to do all the business they like to do like tourism and education—and both might take a while—but also to be a haven for capital protection. The people on the other side of the House immediately recoil at the words "protecting capital". That would be awful—a horrible thought to them. But if people find that New Zealand is a place where they can invest that relatively small amount to buy an asset and to mothball it effectively until the good times come, then that's to our advantage. Otherwise, if that place falls down, it will be a fire sale, locally, and if it's not a fire sale locally it will just sit there and it will deteriorate, and I tell you what, you don't have to look too far into the Pacific to see a whole lot of failed assets that have massively deteriorated because of some of their particular views about selling assets to foreigners. So we do need to be quite reasonable about this and I think we do need to have the time in front of us to allow people to have a good look at it, to understand what it's all about, and to offer an opinion. 
There's a second bill that's coming that's going to a select committee for three months—the normal time is six months—and that's about right. That's a good bill. We don't necessarily agree with everything in it, but there are lots of things in it that are necessary for consideration when you are looking at ensuring that you get the right sort of investment in a country. But this thing, being rushed through so very quickly, overlaying the current arrangements, seems to me incredibly short-sighted, somewhat knee-jerk, and it was almost certainly cooked up by a group of cardigan-wearing officials in the back room somewhere who decided that they knew how the economy can best be protected. Well, the reality is it's best protected by protecting the capital that New Zealanders have invested in the productive assets of the country, and if part of that means that someone who has capital from offshore is for a time able to invest and sit on it, then that is again, I say, to our advantage. These are the sorts of things that we need to hear in the select committee. 
I know of one hotel chain that is a massive employer—600 people—and they're going to have to put 80 percent of them off. Now, wouldn't some investor that they might like to attract be a good thing if it meant that the carnage for that workforce was not so great? These are the sorts of things that we need people to come to the select committee and make the case for this bill being not quite as good as it should be. 
I'll go back to what I said before. I've amended the motion so that the select committee reports on 15 June, giving an extra couple of weeks—only a couple of extra weeks—to consider it, and let's be clear: we're in level 2 now. Level 2 is not reviewed for two weeks, so the level of activity that's likely to take place during that time in tracking down someone to invest, and all that sort of thing, is unlikely to happen. So the pace that's being put on here is completely artificial, and I think it's probably designed to make the Budget look more robust than it really is. 
All the Budget was was a massive expenditure and this sort of idea that "Don't worry, the Government's here to help." Well, the Government can't do that for ever. It just has to rely on the private sector coming up with the capital that's required to keep the economy going. The Government can't employ everybody, and it certainly can't tax the death out of people who of course are getting their income from the Government. This is just so circular; it doesn't really need any further explanation. 
This bill, I think, is disappointing. On the one hand, we get the comment from the Prime Minister that "Yes, New Zealand can be a great destination for the rest of the world to look at, and capital protection will be part of that.", and then we get this commitment from the Government that "We're going to increase the wage subsidy. We're going to keep New Zealanders in work. We're going to really put all sorts of investment in all sorts of places, and not only are we going to put KiwiBuild behind us but we're going to build 8,000 houses in the next very short while."—in the next two years. Everyone's going to really sit up and notice that one and take it on board. 
So it's all these things, and the other thing is we were supposed to have a bill right now that was going to make it easier to do some of these infrastructure projects that are going to employ thousands of New Zealanders, but that's gone. Instead, the centrepiece of the Budget appears to be a bill that restricts foreign ownership—restricts foreign investment—and it's the investment part that's the worst of it, because you can just go through the history of New Zealand, as I said earlier, and then David Seymour stole some of my better lines in his speech and offered them to the House. It has been, since the 1800s; in fact, he took it back further. He's a much deeper historian than I am. He took it back to Kupe. He left off the kūmaras, though—they were important—and ever since that time, investment in New Zealand is what has grown the country. So why are we today hastening the time that a select committee can scrutinise a bill that would be very helpful, if it didn't exist—very helpful—for a whole lot of medium to large sized enterprises in the areas that the economy has been so devastated in: primarily, hospitality and tourism? 
So I hope that the House will be good enough to recognise that just a little bit of extra time—just those extra two weeks—might be a good thing. It might be a reasonable thing for the public and also for all of the particular operators and investors in these sectors so that they can understand what the Government's doing. I mean, we're going to help them anyway—there's no question about that. They need to know that this is not a positive thing; it actually sets out to achieve exactly the opposite to its purpose. Then, I think it would be a conscious decision for the Government—a much more conscious decision for the Government—to say, "We're going ahead with it and we don't care. We have no interest in New Zealand's small business accessing the capital it needs from offshore." 





ASSISTANT SPEAKER (Hon Ruth Dyson): Before I call the next speaker, firstly, I forgot to say that the question is that the motion be agreed to, but Mr Brownlee, obviously, knew what we were debating. Can I also say that I know there's a lot of pent-up energy because we haven't been debating as much in the last couple of months as we might have, but I don't think that we need to use that energy to criticise public servants who don't have the opportunity—there are 119 members in the House that we can criticise, so perhaps leave public servants out of the debate. 





KIRITAPU ALLAN (Assistant Whip—Labour): I move, That the question be now put. 





DAVID SEYMOUR (Leader—ACT): Thank you, Madam Speaker, and I just want to pick up on your comments. I thought that the Hon Gerry Brownlee's comments about civil servants and cardigans were most unfortunate and really damaging to the reputation of this House, and I'd just like to redeem that by putting on record that a cardigan—
ASSISTANT SPEAKER (Hon Ruth Dyson): Mr Seymour, that doesn't require you to repeat an insult. You could be better than that. 
DAVID SEYMOUR: OK. Well, I was trying to redeem it by saying that it's actually a very practical garment, more comfortable than a jacket, more formal than a sweater, and should actually have a place in everyone's wardrobe, and there's nothing wrong with wearing a cardigan. 
Hon Gerry Brownlee: I raise a point of order, Madam Speaker. Thank you, Madam Speaker. I reflect on your admonishment, and I do want to withdraw and apologise. I must also say that at a previous time, dealing with a different, much, much smaller crisis for New Zealand, we were very reliant on the work of State servants. I do appreciate that they do good work. My real point was that I don't think they're the sole repository of good ideas, but I do apologise to them and the House for any reflection that might come from the House on them. 
ASSISTANT SPEAKER (Hon Ruth Dyson): David Seymour, you do know the motion that we're referring to and debating? 
DAVID SEYMOUR: Oh, very much, Madam Speaker. 
ASSISTANT SPEAKER (Hon Ruth Dyson): Excellent. So you'll speak to it? 
DAVID SEYMOUR: Yes, I certainly will, and I think it's unfortunate you'd insinuate that I wouldn't. It should have been clear that I was supporting you in not wanting this House to in any way denigrate civil servants. 
The motion, of course, as you know, Madam Speaker, and people at home know and people on both sides of this House know, in fact, is whether or not this bill, making significant changes to the rules for foreign investment in New Zealand, should go to a select committee for only 10 days or, as amended by the Hon Gerry Brownlee, for about three weeks. I'm speaking in opposition to that motion, for a couple of reasons. One is that a select committee process of that length can't practically be a meaningful one—so that's the first point here. The second is that failing to have a meaningful process around making this law, that affects the ability of foreigners to do business with New Zealand business people, risks imperilling New Zealand's reputation at a time when we've had a series of legislative initiatives or, I might say, blunders that have done damage to our reputation. 
Let me just start with why it would be an inadequate select committee process. Asking the House to report back in 10 days, or even three weeks, does not give adequate time for people affected to consider their submissions. They've got to read the bill, understand it, get advice, put their submission together, and send it in. So in order to get public feedback, you need at least a couple of weeks. Then those submissions have to come to the committee and be read by the members, who have to understand them, and then they have to bring the submitters in, if they wish to make an oral submission in person. They've got to listen to that and contemplate and cogitate, and then, with the help of the committee officials, deliberate and report and suggest amendments to the bill—none of that can happen. 
So the first point I make is that if we shorten the select committee process, either to 10 days or to Mr Brownlee's 25-odd days, we are going to have an improper select committee process. It will not be good lawmaking, and that matters to this House. There's nothing to say New Zealanders have to follow the laws made by this House. They, by and large, choose to because they believe we have good processes, that we listen, and that we represent them, and we erode that trust at our peril. 
But the second issue is that this legislation is happening in a context where there are already reasons why people in the international business community are having second thoughts about New Zealand as a safe destination to invest and to send capital. I'll just give you two examples. The recent oil and gas exploration ban: if you talk to people in that industry, they look at the process under which it came about. The Prime Minister announced it. Allegedly, there wasn't even a Cabinet paper, and the legislation followed in a rushed fashion later on. That has sent shock waves through people in that industry when it comes to investment in New Zealand. 
Maybe that's what the Government wanted, but even if it was, what they've shown is that rushed and unexpected processes diminish the confidence of people who want to invest in New Zealand, because they basically say that New Zealand's actually a very difficult place to find oil and gas and to extract it, and once you get it out, it's still in a very remote location in the global context. So it's hard yakka doing oil and gas in New Zealand. But at least when you invest in New Zealand, you know it's a First World country with robust democratic processes, very good institutions, the rule of law, and your property rights are safe, so New Zealand's still worth it. We imperil that at great cost to ourselves. 
The second example—and, ironically, this evidence was presented to a select committee—was the Overseas Investment Amendment Act which happened back in early 2018. I, as a member of the Finance and Expenditure Committee, heard from many people who came and submitted, and they said, "You guys have no idea what's going on out there." These are people who are Kiwis who do business around the world in places like New York and Singapore, and they said people are looking around and they are saying, "WTF is happening in New Zealand right now? We thought this place was actually safe. We thought it was a great place to invest. We thought that this place welcomed foreign investment." They said, "If you guys keep doing stuff like this, it's pretty simple: people might still invest in New Zealand, but they will add on a premium for sovereign risk. They will charge more to loan to New Zealanders, because they see the risk of a country that increasingly legislates at haste and repents at will, a country that does not uphold its own processes, that rushes legislation and erratically imperils our property rights when we invest in their country.", and that is what's at stake here. 
If this Parliament continues to legislate at haste and repent at leisure to rush legislation through with shortened select committee processes to try and introduce arbitrary ministerial discretion—as this bill does—into whether someone can invest here, then what we are going to find is that people around the world are going to expect a higher premium when they invest in New Zealand, a higher premium for sovereign risk, and what I'd say to the House and say to the Government is that it can't be one or the other. If there truly is an urgent need to stop some sort of inflow of foreign capital—heaven forbid—and there is some sort of security issue that the Government knows about where perhaps some foreign power is seeking to overtake strategic assets—you know, it's funny, everyone loves saying "strategic assets". No one that's ever said that has been able to tell me what strategy they're referring to, but I leave that aside. 
If the Government knows that there's an urgent security threat to New Zealand or that a foreign power wants to orchestrate a takeover of assets important to New Zealand's security and economy, then they shouldn't be waiting. They should be doing it straight away. But if all we're worried about is some beleaguered hotels that are trying to keep their staff employed—might get a welcome source of capital from offshore investors—then there's no urgency required whatsoever. In fact, we shouldn't be trying to impede that sort of activity at all. 
So the Government can't have it both ways. Either they should do a full select committee process where, hopefully, the complete madness of this legislation will be revealed and they'll back down, as they occasionally have—I'll give them credit—once or twice in the course of this Parliament, or, if there's truly a serious and urgent threat to New Zealand, they should be doing it straight away. But a 10-day, bogus select committee process will damage our international reputation and make New Zealanders pay more for capital. I oppose this motion. Thank you, Madam Speaker. 





Dr DEBORAH RUSSELL (Labour—New Lynn): I move, That the question be now put. 





ANDREW BAYLY (National—Hunua): Madam Chair, thank you for giving me the call. I rise to support the amendment by the Hon Gerry Brownlee, and I do so for six reasons. The first one is that we have listened to a Budget this afternoon where $50 billion has been set aside to help the country through the COVID crisis, but I cannot understand how this piece of legislation hinges off that Budget and why, as a result of the Budget, this is so urgent. I haven't been able to understand that connection. Therefore, I wonder why, in the context of calling for urgency on this matter, it is being done today. 
The reason I raise that is this House has sat for three weeks, and if it was so amazingly urgent—
ASSISTANT SPEAKER (Hon Ruth Dyson): I'm really sorry to interrupt the member, but the time has come for the House to adjourn for the dinner break. 
Sitting suspended from 6 p.m. to 7.30 p.m. 
DEPUTY SPEAKER: The House is resumed. When we rose for the dinner break, we were debating the instruction to the Finance and Expenditure Committee and the Hon Gerry Brownlee's amendment to it. Andrew Bayly had the call, and he has nine minutes and nine seconds remaining if he so wishes. 
ANDREW BAYLY: Thank you, Madam Speaker, and I must admit, I compliment you on what you were wearing this morning. It was the same colour as the bright sunrise that we all faced on the morning of the Budget and, I think, very appropriate given the debt figure that was mentioned today of $50 billion of additional borrowing. 
So, just turning back to the Hon Gerry Brownlee's amendment, which was to extend the report-back date to give more time for a proper consideration of this bill, I was speaking to this bill, and I agree with it. In fact, I think there are six reasons why we do need to have an extended time frame so that this bill can be properly considered. I talked briefly before the meal break, but the first thing is in the context of the Budget that was discussed today, I cannot see the relevance of this piece of legislation and how it links back to the Budget. 
I would've thought the purpose of today was to go into urgency to make sure that the Government is achieving all the most pressing issues that relate to the Budget. But this issue wasn't actually discussed in the Budget and I can't find reference as to why this particular bill needs to be even discussed today under urgency, and, secondly, why it needs to be convened. Under the current proposal, it would be debated over the next three days of next week and reported back to the House the following Monday, which is a very, very short period of time. 
The other reason why I think the Hon Gerry Brownlee proposed this three-week extension is that this bill is actually quite technical in nature. It's got a whole number of facets, but two of particular relevance: one is the definition of what is now a foreign investor. Under the current rules, if someone has a 25 percent investment, that is deemed to be a foreign investment, and it triggers a whole lot of clauses and requirements under the Overseas Investment Act. But there have been changes to those rules, and they need to be discussed to make sure that we're actually coming up with rules that smart people cannot set about trying to work a way around them so that they don't come under the requirements of the Overseas Investment Act. That needs some time to think about that and make sure that it's appropriately drafted, and the other one is quite a substantive change. 
Under the Overseas Investment Act, currently, if foreign investors are looking to buy a New Zealand investment, they have to do what's called a counterfactual argument, which is to say that this is what the best New Zealand investor would have done with this asset that they're proposing to buy, and the foreigner has to then substantiate not only would they meet that test of what the best New Zealand investor, with all the resources—no limit on that—would do, but what in addition the foreign investor brings to that investment. That counterfactual test, under this proposed bill, is going to move to what is called a before and after test. Again, if we do want to enshrine some legislation that has permanence around it and is long lasting and acceptable to foreigners as well as to New Zealanders, I think that's a very substantive technical change. So those are two examples why I think the technical nature of this bill requires a lot more consideration than our hoping some people are going to turn up and our just relying on advice from officials, which may be very pertinent, but may not encompass all the various aspects. 
The third thing that has been talked about when we were talking about the previous Overseas Investment Office amendment is the possible need for security services to provide some input on this aspect. There has been no briefing provided to the Opposition on this issue, which I think is a real mistake. That briefing would have to be undertaken next week, and, of course, the availability of those people and how people actually hold those meetings—because it certainly wouldn't be done over the internet with the current Zoom arrangements. They would need to be held in person, and I think there's a recess week next week. I think the logistical issues of that are quite significant as to whether, in fact, that can take place and be communicated in a way that it ought to, given the sensitivity around some of those discussions. 
The fourth thing is a matter that was raised earlier as well, and I think it's particularly pertinent. If we make these changes to the Overseas Investment Act, what is the implication of that on our free-trade agreements? As many people in the House know, we've got a multitude of free-trade agreements, and, actually, we have different standards of free-trade agreements. Some are much more comprehensive—such as our favoured nation status with the Chinese Government—through to other ones that are less comprehensive. Now, again, that is quite technical, and if you were to make these changes, the implications on those free-trade agreements are a really, really important consideration, because, potentially, if we impose something that is outside the reach of those foreign trade agreements, we could be taken to the World Trade Organization in some form of dispute. That would be the last thing that New Zealand needs at this point of the economic cycle, where we're right at the bottom and we're wanting to further expand our trading relationships. 
The next issue is we actually need some submitters, and if we're going to hold it next week, even if we pass this bill tomorrow or late tonight, the officials will have to do the logistical issue of working out who they're going to go and hear from, provide those submitters with a copy of the bill—which, literally, has just come out today—and give them enough time for them to come down or to have a hearing sometime next week, and that presupposes that all those people are available next week to make submissions. Whilst that may be possible with our domestic advisers and all those people involved, one of the things I'd actually hoped we'd hear from is foreigners who are looking to invest in New Zealand, to hear their issues with this bill and their context around it, and whether it still works for them, because I think that's a real test. If we are to tighten up the rules, we need to make sure we don't do it in a way that people mistakenly take a view that this bill is actually anti - foreign investment. I think that is an important consideration. 
Again, I'd just say to you: I just literally do not think there is sufficient time to actually get a reasonable number of submitters to make a high-quality submission in a matter of just two or three days. I just literally do not believe that's going to take place. 
The last thing is I just think we are treading on dangerous ground. If we get wrong this bill and the one that we discussed just before, the related overseas investment bill, the potential damage to New Zealand as a First World country, as someone who welcomes the right type of foreign investment, something that's going to support the New Zealand economy as we go forward from this incredibly difficult time over the next few years—if we get this wrong and if our trading partners and our potential investors in New Zealand see it in a different light, then that is, potentially, incredibly damaging to future trade in New Zealand in export markets, and I just think that is a risk we cannot take. That's why I strongly support the amendment by the Hon Gerry Brownlee that we extend the time frame to an extra three weeks to give us sufficient time to make a quality submission and report back to the House so that there's a proper consideration of the matter. Thank you very much. 





Rt Hon DAVID CARTER (National): I just want to make a brief call, with three succinct points in support of the amendment moved by the Hon Gerry Brownlee with regards to extending the select committee process out to 15 June. My first point is that in all reality, the current deadline that's been proposed by Minister David Parker is nothing but a sham select committee process. To introduce a bill tonight under urgency, expect people to take note of the ramifications of the legislation to acknowledge that we're in a lockdown currently, at level 2, to submit sensible submissions to the select committee, and for us then to have a select committee process to hear them when, again, we're all in lockdown and in recess week, I truly believe that unless it's extended, it's, effectively, a sham select committee process. 
My second point is based on the history of the Overseas Investment Act (OIA), which was one of the first pieces of legislation passed by the Labour - New Zealand First - Greens Government after the last election. I sat on the Finance and Expenditure Committee with that particular legislation and we had literally hundreds of submissions. There was a lot of interest in that legislation, and the important point about those submissions is they were constructive and caused us to substantially change the legislation. 
I'll give you two examples. One was a very good submission from a company called Conrad Properties. They argued before the select committee that the legislation as proposed would change their business model to the extent that they would not be able to build the apartments they currently had under way in Auckland, because their business model was based on pre-sales, many of them to overseas investors, and, lo and behold, the Government listened to that select committee submission and they changed the legislation to allow that company to continue to operate. We know, subsequently, that that company was a substantial donor to political parties, and to one party in particular—New Zealand First and the foundation—and I'm sure that had no influence on the quality of the submission and the decision of the Government to change the legislation. 
I'll give you another submission that came to our notice. A number of the forestry concerns were concerned that the proposed legislation would, effectively, gazump the Government's own target of a billion pine trees to be planted—a billion trees. Again, and I recall from memory it was Supplementary Order Paper 209, which suddenly came in and changed the regime around forestry and liberalised it to allow overseas owners to come in. 
Andrew Bayly: 1,000 hectares, was it? 
Rt Hon DAVID CARTER: I think it was 1,000 hectares they could buy without even having to go through an OIA process. 
The point I'm making is good submissions come before the select committee. If they're constructive, they're adhered to, and we change the legislation, and then this Parliament thinks it's got better-quality legislation coming through. 
The third point I want to make is the effectiveness of extending it out to 15 June. We had in the debate on the introduction of the legislation the Hon David Parker talking about the rationale for this legislation is to protect strategic assets. Does the Minister truly believe that there's a deal being negotiated now, under the COVID scenario that this world faces, where any of those strategic business potentially can be sold and not affected by the current overseas investment regime? The answer to that has to be no—there is no possibility of a deal being done and concluded by 15 June. 
So, on those three points alone, Gerry Brownlee's amendment deserves serious consideration by this Government. If it's prepared to acknowledge that the legislation introduced under urgency requires a select committee process, let's give it a minimal select committee process that at least is constructive and realistic. 





DEPUTY SPEAKER: The question is that the amendment in the name of the Hon Gerry Brownlee to amend the report-back date to 15 June 2020 be agreed to. 
A party vote was called for on the question, That the amendment be agreed to. 
Ayes 57
New Zealand National 55; ACT New Zealand 1; Ross. 
Noes 63
New Zealand Labour 46; New Zealand First 9; Green Party of Aotearoa New Zealand 8. 
Amendment not agreed to. 
A party vote was called for on the question, That the Overseas Investment (Urgent Measures) Amendment Bill be reported to the House by 25 May 2020 and that the committee have authority to meet at any time while the House is sitting (except during oral questions), during any evening on a day on which there has been a sitting of the House, and on a Friday in a week in which there has been a sitting of the House and outside the Wellington area, despite Standing Orders 191, 193, and 194(1)(b) and (c). 
Ayes 63
New Zealand Labour 46; New Zealand First 9; Green Party of Aotearoa New Zealand 8. 
Noes 57
New Zealand National 55; ACT New Zealand 1; Ross. 
Motion agreed to. 





OVERSEAS INVESTMENT AMENDMENT BILL (NO 3)
First Reading
Hon DAVID PARKER (Associate Minister of Finance): I move, That the Overseas Investment Amendment Bill (No 3) be now read a first time. I nominate the Finance and Expenditure Committee to consider the bill. 
This is the second of two bills that, between them, cover the territory that was in the Overseas Investment Amendment Bill (No 2), which was introduced on 19 March 2020, which has been sitting before members of the House now for close to two months. That bill, as I previously described, has, effectively, been split into two parts. One part was in the last bill and the other part is in this bill. The only addition to the first part was this new, lower screening threshold during the COVID period. In terms of briefings being offered to the members, briefings were offered when it was originally tabled, but, of course, COVID interrupted and—through no fault of the Opposition or anyone else—those briefings weren't given. And they weren't re-offered until earlier today, when we had been re-meeting under level 2, for reasons that the members understand as to where those briefings have to be.
On this side, we believe that the changes already outlined in the prior bill, plus the changes that are in this bill, together with the prior reforms that we had during this term of Parliament, are a suite which improve the integrity of our foreign investment screening regime. If I could just recap on the changes that we've already had: we introduced new screening requirements for foreigners buying residential homes, which, from the point of view of the Government, was necessary to ensure that the housing market is set by New Zealanders for New Zealanders, and not by foreigners who don't live here.
The second thing we did was we reformed the overseas investment regime for forestry, and we did two things there. Firstly, we screened forest registration rights, as the Rt Hon David Carter mentioned, because they previously weren't screened by the scheme and it was being used as an avoidance mechanism and, effectively, meant that the forest regime was ineffective. At the same time, we simplified processes for forestry, because, although we wanted to have a screening regime for the future, we wanted to encourage more investment in forestry, which we did by enabling a more permissive screening regime for all classes of forestry.
The combined changes of the Overseas Investment (Urgent Measures) Amendment Bill that we've just put to the Finance and Expenditure Committee, plus those prior changes, plus this bill, complete that package of reform. And I'm confident that these bills combined will not only leave us well positioned to navigate through this current crisis but, in the long term, they support the sustainable and productive investment that we need to improve New Zealanders' living standards.
While we've sought and been given by the House permission to have a short select committee period for the urgent measures bill, because we need that to pass into law quickly—and I would again remind the House that Australia did that by statutory regulation overnight, and Canada and Europe have already done it—my intention is that the select committee and Parliament be able to fully consider this bill in a normal select committee process, a full process. And that will include interaction of the parts of this bill with the parts of the urgent bill that remain, i.e., the national interest test. So we want the select committee to have the full time under the second bill to properly consider all of those details of the national interest test, because I agree that they are worthy of that scrutiny. The only difference between the No. 2 bill that's been there for two months and these two bills combined is actually the short-term intervention in respect of COVID that takes the threshold down to zero for that COVID period.
As prior speakers on both sides of the House have noted, overseas investment does benefit New Zealand. It creates jobs, brings new technology, boosts productivity, drives growth, brings international connections, and our economy is built on openness to trade and productive investment, and the Government wants to ensure that this continues. At the same time, we know that some overseas investment can bring risks or disadvantages, and we think it's appropriate that the overseas investment regime can manage these. In respect of the survey that I think one of the members was referring to when he said that New Zealand's international rules relating to overseas investment are already quite strict, that is only true in respect of land-based investments. It's actually not true in respect of business investments.
The balance that we need is, of course, always a matter for debate, and we think the balance is not currently right. This particular bill has two main parts. Firstly, it codifies into the primary Act the effect of existing regulations about investments in rural land, and we think that it's appropriate that that sit in primary legislation rather than be able to be changed by Ministers from Government to Government by statutory regulation. It is, of course, the right of any Government to change those, if they can convince Parliament that they should, but we think they should have to come to Parliament to make those changes, rather than do it by statutory regulation, and I'll give a point to illustrate why that's necessary.
Following the controversies when the Rt Hon David Carter—I'm not sure if you were still Minister of Agriculture at the time, or whether you were in the Chair, but there were controversies around the sale of the Crafar Farms to overseas interests. At the time, the National Party said that, in response to the public outcry, they were going to make it harder to buy rural land, and they introduced a rule that they said was going to achieve that purpose. What it said was, through a side letter they sent to the Overseas Investment Office, please look favourably and approve applications to buy farms up to 10 times the size of that type of farm. So you could buy 10 times the size of an ordinary dairy farm, get approval, and then get turned down on the 11th. You could do the same with sheep farms, or sheep and beef farms. Now, we thought that that was really pulling the wool over the eyes of New Zealanders, and didn't think that was right. We removed that, we changed the letter of expectations, but we're now saying that those changes and the existing regulatory standards should, in effect, be brought into the primary Act.
The second thing it does is it has further measures to cut red tape to streamline the process for most people investing in New Zealand, which will help our attractiveness. In terms of the red-tape cutting, we're building greater flexibility into the consent process for both prospective and repeat investors of good character. This will enable investors to complete transactions more quickly, with lower compliance costs, having met the simplified good character relationships, either as part of previous transactions or in advance of a current transaction. We're removing short-term leases and some other less-than-freehold interests in land from screening. As I've said in respect of land, we don't really think that there's any economic benefit in selling our farmland to overseas interests. We think that our farmers are amongst the most efficient in the world, and it's interesting that most of us, at the moment, are very thankful that our farming industries and our farm processing industries, which are dominated by New Zealand ownership, are actually still performing for us through COVID. I think we should reflect on the fact that the status quo is actually performing very well for New Zealand, and that we ought not to put that at risk by selling land-based assets overseas.
So this codifies those positions rather than lets a future Government, by regulation, effectively by stealth, after not having campaigned on the issue—just doing it by Government regulation in a way that would cause more of our farms to be overseas-owned and for us to be tenants in our own land. There are some changes in there relating to bottled water on sensitive land, where discretion is allowed to ensure that there's not going to be an impact on water quality and sustainability. 
In conclusion, we think that, as always, the role of productive investment is important to lifting New Zealand's wellbeing and productivity. I actually agree with some of the comments that were made by the Hon Gerry Brownlee—that we have to be careful that we don't become so restrictive that distressed assets can't be sold when there's a proper reason to do so. But we also need to be careful that we have the appropriate protections in so that the Governments of the day can protect the national economic interest as they see it, as part of their right to govern. I recommend the bill to the House.





Hon PAUL GOLDSMITH (National): Thank you, Madam Speaker. So here we are with the second of the overseas investment bills, and the National Party will again support this bill to the select committee for further consideration. Look, we're supportive particularly of the elements of this legislation that aim to make it simpler for people to make productive investments in New Zealand.
So, just for people tuning in, if we go right back to where we get jobs and growth from, and opportunities for New Zealanders, fundamentally most of those jobs and opportunities come from somebody, somewhere, making an investment—an investment in a new business. To rebuild their business, to start a business, to grow their business, to take a chance, to take a risk, to be entrepreneurial, and to get ahead, ultimately, you have to invest some money.
As we've seen today in this Budget, where New Zealand has fallen into a colossal economic hole initiated by this virus, and we're now looking at, you know, new debt of up to $140 billion—extra $80,000 per household—and unemployment rising, we're in desperate need of economic growth and opportunities, and so we're in a desperate need for investment. Now, there are only two places you can get investment from: either domestically—that is, from New Zealanders—or/and the rest of the world. Now, if we rely entirely on domestic savings for investment, well, that's fine, but we'll grow quite slowly because there's not that much of it. So if we want to grow faster and if we want to have more opportunities, we need to get money from the rest of the world—which is what we do, and which is what we've done for the history of this country for a very long time.
Hon Member: He's on to it. Since Kupe.
Hon PAUL GOLDSMITH: That's right. It's what has led to the growth of this country.
So, in the meantime, in response to concerns particularly around land and around sensitive land, sets of rules have been developed to ensure that when overseas interests purchase sensitive land in New Zealand, in particular, they have to go through a series of hoops. Now, obviously, nobody can take the land away, and so the land will always remain there, but a lot of New Zealanders have been concerned about our ownership and direction over land across the countryside. You can argue about the merits of that. There are benefits in terms of having some sense of comfort that we're not going to be tenants in our own land—the fear that many people have. Against that, of course, these rules become very tedious and cumbersome and difficult to negotiate.
The practical reality of the current laws is that because they are so difficult—and particularly because they're so hard to predict the outcome of those laws—when an international investor is considering buying something in New Zealand, or has an interest in New Zealand which involves lots of landholding, then it becomes very complicated and very time-consuming. Now, the logical outcome of that is that many foreign investors who could be investing in this country, providing jobs and opportunities for New Zealanders, will throw up their hands and say, "It's all too hard; I'll go somewhere else". Because there's a whole world out there of places where you can invest; you don't have to invest in New Zealand, and if we make it too difficult and too complicated, they won't.
So this bill does some things that will make it easier—in particular, no longer requiring low-risk transactions to be screened. Now, obviously, we in the National Party would like this to go further, but it's saying that investments in less sensitive land that are only screened because land adjoins land that is sensitive in its own right won't need to be screened. You would think that would be pretty obvious. So we're protecting sensitive land, but under the current regimes, if you happen to be dealing with land that's next to sensitive land, well, then that gets caught up in the system, which is terribly cumbersome.
Then we've got: it affects many New Zealand companies and people. We think of New Zealand companies—like Fletcher's, for example—but because there's a certain amount of international shareholders over a particular threshold, that gets caught up in the regime. So they have to go through hoops every time they want to purchase land and move around.
This legislation also excludes leases for less than 10 years, which, again, we'd prefer that to go further. But at least it makes it a little bit easier and removes a section of transactions from this whole cumbersome process. It also streamlines various other processes, and so forth.
So to the extent to which this bill streamlines the process a little bit, we are supportive of that. We notice that there are some elements to this bill which go the other way and are somewhat vague—I'm referring to some reference to Māori cultural values and wāhi tūpuna. So it will be very important that we have some clarity about exactly what that means so that people who are sort of contemplating purchasing things consider that. The information required to be disclosed regarding the tax structure and tax treatment probably is useful and helpful.
The final point I'd make is that we're at a time now where there will be many businesses across the country that are shaky—in fact, could be about to fall over and New Zealanders are about to lose their jobs. There will be examples where there will be people around the world prepared to invest in those companies and put some money into those companies because they think they're fundamentally good businesses, they need to get through a very difficult spell where they haven't been able to sell any products, get any revenue, and they just need some capital injection to get through the next couple of months. If we make that too difficult because of these laws—this one and the previous one—then we could be costing more jobs. We've had a Budget where tens, indeed hundreds, of billions of dollars have been thrown at the task of trying to save jobs and help the New Zealand economy. If we're passing legislation that goes in the opposite direction, that would be, obviously, highly counter-productive.
So we'll be looking very closely at this bill as it goes through the select committee. We are hopeful and, indeed, confident that by the time that it comes out of the select committee there will be a different Government and we'll have a good chance to scrutinise this and make sure that it does the best job possible in order to provide the opportunity for New Zealand companies to get the capital they need to provide jobs and opportunities for New Zealanders. Thank you, Madam Speaker.





Dr DEBORAH RUSSELL (Labour—New Lynn): I wish to speak to several points in respect of this bill. The Overseas Investment Amendment Bill (No 3) is the second overseas investment bill we have considered this evening, and I will look forward to working on both of them as they progress through the Finance and Expenditure Committee.
I want to speak to a point that's been raised both in respect of this bill and in respect of the previous bill, and that is how to deal with businesses which are, like businesses worldwide at the moment, facing tough times, finding it hard to get through. Businesses that could survive just with a bit of a hand—a bit of overseas investment is the particular case that we're looking at here. The line that has been taken by some people in this House is they said, "Well, hang on a second, if we're not going to have overseas investments, we'll be sacrificing jobs, and those are much needed jobs." Indeed, we've had a Budget today which has worked on jobs, so there's real focus on it. But that is to imply that all overseas investments would necessarily be turned down, and they won't. What overseas investments of any particular scale need to pass is a test of whether they are not in the national interest. May I suggest that it would be quite straightforward to argue that an overseas investment that supports and creates jobs is indeed in the national interest. It is not actually a problem that it goes through a test first, because that is a fairly straightforward test to pass.
We have seen in recent months cases where people who have bought assets in New Zealand with Overseas Investment Office approval have been required to sell those assets because they made commitments about what they would do with the properties they bought and then didn't fulfil them. So quite properly, they were asked to then sell the assets. What this suggests is that our overseas investment process is, in many respects, working, but there are some aspects of it that we need to tidy up and that we need to do better. We can do it faster, we can do it better, we can cut some of the unnecessary red tape around it, but we do not want to cut all the hurdles—we do not want to cut all the hurdles. Why? Because we do want to protect our assets. We do want to protect the values of New Zealand. We do want to protect those things that are precious to us, such as our most valuable land, such as our wonderful natural assets, such as our water, which will be covered in this bill. We do want to give due regard to the values that come to us from the tangata whenua and make sure that they are respected. They may not be easy things to do, but they are things we ought to try to do.
Now, this bill will require things, if it goes through, like that overseas investment in farmland will be required to bring a substantial benefit to New Zealand before they can acquire farmland. That seems to me to be a reasonable thing, but let's talk about that in the select committee. It will ensure that before overseas persons can bottle water on sensitive land, if it goes through, that we'll need to consider the impact on water quality. Will it have an adverse effect on water quality? It would be a test that an overseas investor would need to pass.
So what we're trying to do is make it easier in some respects for overseas investors, but not so easy that overseas investors need to have no regard for our values. That is what this bill is attempting to do. I'm sure that the select committee process will refine it. Even though, as I recall, members on the Opposition voted against the previous overseas investment bill that we had towards the start of this Parliament, they nevertheless worked to refine the bill in the select committee in what was an excellent process. I hope that process will be replicated as we examine this bill in the months ahead. I commend this bill to the House.





Hon JUDITH COLLINS (National—Papakura): The National Party is supporting this bill to select committee. We support anything where there is at least an intention to streamline processes, but most attempts at streamlining processes, I've noticed over the years, tend to actually make them worse. But isn't that the rule of good intentions? That's a bit harsh, but it's probably true. We think it's a good idea to no longer have to require investors to carry out a full screening process once they've already been screened and approved for an investment. These are the sorts of things that add a lot of time and cost, and actually time is money when you're paying for the time of your lawyers and your advisers.
It's also important, I think, to—and having listened to the member who's just resumed her seat, Deborah Russell—you know, there's nothing in here, when I've looked through, about property rights or any concept that once one owns property, actually one owns property rather than simply then everyone else gets a say about what you do with that property. I know it's currently a foreign idea, this concept of property rights, and I can see my good friend Eugenie Sage sitting up in horror at the concept of it. But actually, surely, when people pay for land, they pay for land. But we're very aware that people want to make sure that some assets remain in New Zealand and that New Zealanders get a fair opportunity to partake of the wonderful natures of our country and assets. 
But I do sometimes think that there's a tremendous amount of worry about what might happen when, actually, as I look around the Parliament, most of the people here are children of immigrants. Some are immigrants themselves, grandchildren of immigrants, in some cases, many decades back. But, actually, people come to New Zealand to get ahead in life and we're a very long way from anywhere else. So bringing in whatever we do in relation to overseas investment, we need to understand that overseas investment is generally a good thing. There'll be some instances where it hasn't worked out well for the country, and I think that those need to be acknowledged, but, actually, mostly it's a good thing. Because one of the things with a country of our population of a mere five million people, smaller than Melbourne, in an area larger than the United Kingdom—the one thing we really lack, apart from people, is we actually lack capital. And that capital holds us back.
We get often very proud of the fact—we like to talk about the No. 8 mentality that we have to get things fixed; it's actually quite a sad indictment on the fact that we don't have enough money to buy what we should have bought in the first place. That is, I think, one of the sad things with this, but generally we think it's a good idea to try and streamline the processes. 
I'm not sure that everything in here is going to be treated with universal acclaim by the National Party, but we'll give it a fair opportunity to go to select committee. We think the select committee process is far too short. These are very important and serious issues, and they shouldn't be just rushed through in a very shortened process in the select committee—which the current Government decried every time it happened when we were in Government, and suddenly it's all OK to do that.
I guess we should be very grateful that at least in the select committee we'll have an opportunity to talk about the details. At least we will be able to have some submissions from the public, and we would like to hope that people who are actually involved in investment in New Zealand, or people who are trying to get some investment into their businesses so they don't have to sell them or actually just close their doors on them, will want to be able to give submissions on it.
I went for a walk yesterday—I'm sure you all want to know about this—around Wellington Central, a nice long walk, and I thought there was nothing open, really, apart from a couple of places selling a few cups of coffee to people as they wandered by. It was so empty and eerie, it was like I was expecting some tumble weeds to come racing down the street. It was so empty. I hope it's better today; because I've been so busy here all day, I haven't had a chance to go out. But I really do think we need to get ourselves, basically, into the real world. We need money in this country and we need it fast, so let's not be silly; let's help this bill get through to the select committee and let's actually have some streamlined processes, and let's hope that for once they actually do work.





TAMATI COFFEY (Labour—Waiariki): Thank you, Madam Speaker. I'm looking forward to having this bill come before the Finance and Expenditure Committee, mainly because this is something that New Zealanders are really passionate about: making sure that everything that we have here in New Zealand is protected for us as New Zealanders. And it shouldn't be seen in isolation: in fact, this Government has done a lot of work. In terms of screening housing and in terms of forestry, we've done a lot of work to make sure that New Zealanders are proud to say that, actually, New Zealand is for New Zealanders. But we can't turn away the thought that, in fact, overseas investment does in fact benefit New Zealand. We get to take advantage of some of the new technologies that overseas investment brings. Some of our productivity is driven by that overseas investment. So we don't want to shut it out, but we do absolutely want to control it, and why shouldn't we, because we set the rules.
One of the things that I'm looking forward to most about this bill coming before our select committee is the protection that it's going to afford land and our natural assets. Now, those of us that have electorates which span the Eastern Bay of Plenty know that in fact there has been a lot of heartache, especially around water and the Overseas Investment Office. In fact, there have been applications from overseas companies to buy up sections of land which has beautiful pristine springs on it, and, in fact, it's brought a lot of grief to Māori communities in the Eastern Bay of Plenty especially. I want to especially mention Ngāti Awa and also Ngāti Manawa as well, who were thinking about embarking on water bottling as their way of economic freedom. But, in fact, what this bill is going to do is it's going to make sure that if there are applications that come in to buy tracts of land where overseas persons are looking to bottle our water, then, actually, Ministers will need to consider the impact of that proposal on water quality and also sustainability. They will have to make sure that it is in the best interests and the benefits of New Zealanders.
So this is a really good bill. It's long overdue—long overdue—and I know that when I go back to my electorate, I'll be talking to a lot of our Māori communities who feel really passionate about the water-bottling issue, and I'll be able to say that this Government is absolutely doing something to make sure that we've got some structure in place so that our land and our water isn't taken from underneath our noses. So I absolutely commend this bill to the House.





ANDREW BAYLY (National—Hunua): Thank you, Madam Speaker, and I note with interest how you're keenly observing this debate tonight, which I must compliment you on.
DEPUTY SPEAKER: Flattery will get you everywhere.
ANDREW BAYLY: Yes, that's correct. I just say to the member who's resumed his seat, Tamati Coffey, when he returns back to his electorate, probably on Saturday morning, I hope someone in his electorate and particularly on his marae might ask him the question: why is it that the Government, which he is obviously part of, pass legislation that allowed foreign investors to buy up to a thousand hectares of land without any Overseas Investment Act requirements? They were loosened under the bill that he was a select committee member on. And so when he talks about protecting New Zealand land, the very Government that he's part of made it much, much more permissive for foreigners to buy New Zealand farmland. This issue needs to be in the context of understanding that 72 percent of forestry land and forests in New Zealand is currently and already owned by foreigners. So why was his Government prepared to allow and open it up even more, when he's just given a speech saying that he wants to make sure that land is better protected? There is a total contradiction.
We know why it occurred: because one of his support partners required it. It is outrageous for the Government members to stand up and try and say that they are better protecting land, when they are allowing thousands and thousands of hectares to be bought by foreigners and to wait—it may not even be planted immediately, but eventually will end up in forest, with all the downsides that then happens when already 72 percent of forests in New Zealand are owned by foreigners. I just think there is a lack of concurrence and clarity around what they are trying to achieve. This bill does some improvements; I accept that. But there is still that total illogicality of what went on last year. 
The other thing I find about this overseas investment bill, and I've spoken on it a few times already—the thing I find about the Government's attitude to overseas investment is this paternalistic approach. So if I'm an entrepreneur and I decide that I'm going to set up a new business, and I might have to buy a facility with a bit of land on it and I take all the risks of setting up a brand new facility, all the financial risks, all the market risks—I might mortgage my house to do it, which is the normal way that people start—and I get over many, many years to a situation where it is a substantial business and a foreign investor wants to come in, somehow the members on that side, the Government members, think that they have the right to say, "Well, you know that business that you took all the risk on and we as the Government didn't do anything about it or didn't support you, you did it of your own right?" Somehow, under certain circumstances, you want to say that that business is so important that some Minister—and we don't even know who the Minister might be; it might be David Parker today and it might be someone after 19 September—probably with very few commercial skills, sitting in Wellington, now has the divine right, and it is a divine right in the sense that he or she can decide whether or not you can sell that business to a foreigner. That paternalistic attitude around it I find slightly grating.
So, as I've said before, we will support this, but I find the way that the Government members talk about this bill, and the righteousness that they've been espousing about these overseas investment bills when there are clear areas where you could drive a bulldozer through, is not appropriate, and I think if you want to do it, do it properly. That's why it's important that all these bills should be heard and properly considered over time, and not rushed through this House just because we think we need to do something under urgency.





Hon EUGENIE SAGE (Minister for Land Information): E Te Māngai o Te Whare, tēnā koe. Thank you, Madam Speaker. In terms of the National Party and the Opposition that it has had previously—and the House spent over half an hour, I think, around the shortened select committee process—what some of the members didn't seem to realise there is that with the previous bill, the Overseas Investment (Urgent Measures) Amendment Bill, yes, that is going through a shortened process, but the fact that this bill, the Overseas Investment Amendment Bill (No 3), is going through the full select committee process means that if there are any changes that are made in the urgent measures bill which are problematic, then they can potentially be addressed through this bill.
That was one of the reasons that the Green Party was happy to support urgency for the previous bill—and also because, given the COVID crisis, given the financial hardship and economic distress that some firms are under, it is critical that the emergency measures and the requirement for any transactions that will seek to have a greater than 25 percent share being overseas owned be notified to Government, go through that 10-day quick assessment process, and, if there are significant issues that relate to national interest, then the Minister of Finance can consider that in a more detailed way.
In terms of this bill, the Overseas Investment Amendment Bill (No 2) that was introduced into the House in March is being withdrawn, and this one is taking its place.
The Hon Judith Collins talked about streamlining. This bill makes a real effort to streamline the process by which applications are considered. It does things like introducing a much better test for character. It deals with the whole issue of the way that that is assessed and makes it more efficient to do that. It also provides for a regulation-making power which enables the Government to introduce an emergency notification regime if needed at any time in the future, if we need to respond to a future emergency.
One of the key things, though, that is really important about this No. 3 bill is the fact—and Minister Parker outlined it as well—that at the moment the ministerial directive outlines the criteria which are to be taken into account when Government assesses whether there's a substantial and identifiable benefit from an overseas person buying farmland. We know that New Zealand farmers are amongst the most efficient in the world. There is really a significant benefit for an overseas person coming in and buying farmland. So in this bill those criteria will become statutory, rather than just being in a ministerial letter. So any overseas applicant will have to demonstrate a substantial point of difference in the likely level of economic benefit or oversight or participation by New Zealanders if they want to receive consent for that purchase.
One of the other issues that this bill strengthens—again, recognising that it is a privilege for an overseas person to own land in Aotearoa New Zealand—is the requirements around advertising. That's to ensure that any New Zealanders wanting to buy a farm get an opportunity to see it being advertised—because there have quite often been some retrospective applications for consents when those advertising requirements haven't always been fully implemented. So this is updating this requirement, ensuring that it can be done on electronic media as well as in print media, and just strengthening that requirement.
The other issue where it's making a significant improvement is in relation to completing the Queen's chain by requiring that areas of foreshore and seabed and riverbed can be transferred to the Crown when the adjacent land is sold to an overseas purchaser. 
As Tamati Coffey mentioned, the issue of water bottling and overseas companies taking water from Aotearoa and exporting it without paying anything for that water is a hot button issue for New Zealanders. This bill, largely because of the advocacy of Green colleagues, is about enabling decision makers to consider the impacts of investments where an overseas company or person is wanting to buy land and that land has a water right attached to it that could be used for water bottling. 
Similarly, it is bringing the legislation up to date and requiring much clearer consideration of issues around tikanga Māori and mātauranga Māori so that that is more of a factor—those cultural values—in decision making.
It's a significant improvement. The bill represents a lot of the consultation that was done on the phase two changes to the Overseas Investment Act—recognising that phase one was about reducing speculation, particularly by overseas owners in our housing market; stopping that happening—and working to implement a number of quite practical changes to improve the process and to ensure that the environmental benefits of investment can also be better considered.
So the Green Party supports this bill, is pleased that the Opposition is supporting it going to select committee, and has every confidence that the Finance and Expenditure Committee will give it very serious and thorough consideration. We'd also like to particularly acknowledge all of the officials in Land Information New Zealand, the Overseas Investment Office, Treasury, and other Government agencies who have worked incredibly hard over a short period of time in response to COVID in taking apart, really, the Overseas Investment Amendment Bill (No 2), putting some of the measures into the urgent measures bill and the other ones into this. So I really congratulate and thank them for their work and commend the bill.





Rt Hon DAVID CARTER (National): As has been mentioned by previous National speakers, we will support this legislation, the Overseas Investment Amendment Bill (No 3), to the select committee. But the first question I have, that hasn't been addressed by any member in the House tonight—and I want the next Labour member to rise and address this question—is why, if it's going to a select committee for a full six months, is it having to be passed under urgency tonight? Duncan Webb shakes his head. He hasn't got a clue. But I'm going to tell him the answer. I'm going to tell him the answer. It's because there's nothing in the Budget that the Government wants to debate tonight.
It's the biggest-spending Budget we've seen in the history of New Zealand, but it lacks detail, so they've had the shortest-possible debate today on the Budget. They've slammed it down, they've put the House into urgency, and, suddenly, the second piece of legislation we're discussing, the Overseas Investment Amendment Bill (No 3), is off to a select committee for a full six months, to come back after the election. So why do we have to do it in urgency tonight? There's no possible—Duncan Webb's ready to rise to his feet. I'm going to look for the answer. I've already given him the answer. He'll fluff around the edges, trying to give an excuse as to why. The only reason is this Government doesn't want us here tonight analysing the Budget.
The second point I want to note is why does the Hon David Parker hate foreign direct investment? He's been the Minister for Trade and Export Growth now for 2½ years, and this is now the fourth piece of legislation he's brought to the House to make it tougher for foreign direct investment in New Zealand—the fourth piece of legislation he's entered into the House. For the first one, Duncan Webb sat in the select committee. Lots and lots of submissions. We worked on it for months. Good submissions, particularly the ones that had an association with New Zealand First: Conrad Properties, the forestry industry. We brought in substantive amendments through the select committee process, to get a better bill.
It was interesting, for me, how they introduced this legislation restricting foreign ownership of land at the same time the Hon Shane Jones was trying to push his tree programme. He'd been asleep at the Cabinet meeting that pushed the legislation through and suddenly realised he was in trouble with these overseas investors, so they passed a Supplementary Order Paper at the very last minute making it easier—easier—for foreigners to come in and buy our farmland, provided they're planting it into trees. A thousand hectares: it's easy to buy. If you're a foreigner, it's easy to buy a thousand hectares, provided you're putting it into trees. And consequently, we've seen good farmland coming out of sheep and beef production, going into trees supported by a subsidy to plant those trees, all because the Hon Shane Jones went around at the last election with his mate the Rt Hon Winston Peters talking about a billion trees.
When I look at the main purposes of the legislation, it enables a higher threshold for acquiring farmland, reflecting its economic significance and cultural importance. I'm actually at the very liberal end of foreigners coming into this country and buying farmland. I've observed a number of farms in Canterbury that have been run by farmers over generations who, coming to the end of their farming life, put it up for sale. It's been bought by somebody who is a foreigner, but they've come in with substantial investment. They've hugely improved the farm. They've employed more people. As I drive around in Canterbury I look at those farms, and they're far more productive. They're far more attractive to look at than what they were under the previous owner. Many of them have been bought by Americans—not a lot of issue there. Many of them have been bought by Australians—not a lot of issue there. But if they're bought by an Asian, particularly a Chinese: outrage from the community, outrage from Labour, outrage from New Zealand First. There's a word for that, and it begins with "R".
The second main purpose of this legislation, it says, is to enable decision makers to consider the impacts of investment involving water bottling. The Hon Eugenie Sage has just sat down and said this is a hot button issue, and I agree it is. Because I know of a particular plant in Kaiapoi, just north of Christchurch—not a lot of significant land involved, but a big investment there—attempting to bottle water. It's a very abundant artisan well, and if it's not tapped and utilised at that source, it bubbles out to sea—well, if you think about it, then to be contaminated. But the issue, again, is the investors in this particular water-bottling plant. They're not American. They're not Australian. They're Chinese, and that's wound the local community up.
Now, if you think about the economics, the wasted opportunity if we don't bottle that water and if we don't take the opportunity to export it and earn overseas funds—think about the lost opportunity. And then the Greens are normally concerned about the environmental impacts of our export industries. Tell me one primary industry in New Zealand that would have less environmental impact than bottling beautifully clean, pure water out of an artisan well, putting it in a bottle, and sending it overseas to earn foreign exchange. The answer is, there isn't one.
So National will support the legislation to a select committee. I won't be here to consider the submissions, but I'll be watching and talking to my mates with great interest. But I do come from a very liberal point of view on foreign investment, because this country was built on foreign investment. Consider the insurance industry, consider the meat-processing industry: founded here in this country, both those industries, entirely on foreign investment, and over time, it transitions, comes into New Zealand ownership. It's good. But we've got a Budget delivered today which we now know the Government didn't want to continue debating, a Budget that was meant to deliver jobs. Well, you don't get jobs unless you've got a business, and you don't get jobs unless that business has some capital to invest. And if this Government over there thinks, in this time, that New Zealand has an abundance of capital to play with, they're dreaming, they're delusional.
We need foreign investment in this country, and this sort of legislation, the fourth such piece of legislation advanced by the Hon David Parker in just 2½ years, sends all the wrong signals to potential overseas investors—who were interested in New Zealand; they've been turned off dramatically over the last 2½ years. And this will be a further nail in that coffin, that will actually make the Prime Minister's wish for the Budget that her Government delivered today to deliver jobs—it'll make this a lot, lot harder to do so, and who suffers then? The very people who, traditionally, vote Labour at an election. Many of them, by the time we get to the election, are going to be unemployed, and I'm going to be campaigning saying if this Government had any sense and any economic realism about what drives an economy, they'd actually be doing the opposite, would actually be making it easier for foreign investors to come into this country. Because if they come in, invest in businesses: there's your job opportunities.
DEPUTY SPEAKER: This is a split call. 





GREG O'CONNOR (Labour—Ōhāriu): What a shame that previous speaker, David Carter, didn't actually listen before standing up and speaking, because he may have heard the explanation for his question from my colleague here, the Hon Eugenie Sage.
For those listening at home, there are two important pieces of legislation. The first piece of legislation we heard tonight was about dealing with some urgent issues around COVID. It appears to have missed the attention of the previous speaker that we are in the middle of a COVID emergency, and the first piece of legislation is intended to deal with that. The second piece of legislation—I hope you are listening, the Rt Hon David Carter—is to ensure that any issues that arise from the need to address that one with some urgency are dealt with in the second piece of legislation, which will go through with plenty of time to do the very things that you are worried won't be done. So can I encourage the member to sit and listen, and he may learn something between now and the short time before he leaves this House. 
The Hon Judith Collins made an interesting comment here. If you'd sat here and listened, you'd have thought that there is no risk to this country in allowing anybody who wants to, with a big enough chequebook, to come in here and buy what they liked. She pointed out that we are all children of immigrants here, whether it was from the Pacific in the 1200s, or right until recently. 
Well, I happen to have a surname—and my cousin Damien, next to me, is another—the most common surname in this House is O'Connor, which means we came from Ireland. That means that we understand what happens when, strategically, you lose all control of your land, because it means that those with English-sounding names—and, actually, I do note that four of the speakers, as I looked on Wikipedia, all have English-origin names. Goldsmith, Carter, Bayly, and Smith: all English surnames. The English came, they owned the land in Ireland, and so that meant that when there was a famine, when the potatoes failed, they were exporting the food from Ireland while the country went from 8 million to 1 million. They starved. That's what happens when, strategically, you lose control of your land. 
Now, I agree that we do need to have the balance right. We do need overseas investment, but overseas investment is about making sure that you keep control of your destiny. It's about being strategic, and what we're talking about is strategy, a strategy which, clearly, those members opposite are incapable of understanding. So, for that reason, this is a necessary, welcome, important piece of legislation that those who come after us will be very, very grateful for. I commend this to the House.





LAWRENCE YULE (National—Tukituki): That was a fine performance—a fine performance—about potatoes from the previous speaker, Greg O'Connor. But I do want to come back to what we're trying to do here and, really, the importance of today. Today, the largest spending and borrowing Budget of all time—and about three hours afterwards we're in urgency debating at a first reading a piece of legislation that is now going to have a six-month select committee process. It defies logic that on the day of the Budget, New Zealand's worst economic day in decades, we are discussing a bill like this under urgency.
It's clear we support this bill going to the first reading, because there are some very good things in it. But I challenge the Government, including the Minister of Agriculture and the Minister of Forestry: we have a six-month process; why do we not, in this bill, address the issue of forestry? The only investment available for foreign investors right now is to go and buy farmland and plant it in trees, and members only need to talk—and I know the Ministers have—to the mayors of Wairoa, Gisborne, the Wairarapa to know that they are horrified with what's going on, horrified. So why in this bill, when all these other things are in here to be looked at, has this Government conveniently chosen not to bring this piece of legislation before the House? After all, we have six months—six months—of a select committee process. 
I think it's deliberate. I think it's deliberate because the Government know there is a big con going on in New Zealand when the only farmland you can buy without any necessary approval is good New Zealand farmland, taking sheep off it, and putting it into pine trees. It is amazing that two months ago farmers were enemy number one of the coalition Government—enemy number one. Now, they are the saviours of New Zealand—the saviours of New Zealand. They're going to come out—the agricultural industry is going to save New Zealand and bring it out of this great recession. They're going to pay the borrowings, they're going to pay all the money back, and they're going to help New Zealand out.
That same Government that has turned on a dime in two months—that same Government—now wants to plant all the East Coast of New Zealand in pine trees, because this bill had an opportunity to try and redress that balance but they've chosen not to. And I'm quite upset about that because, ultimately, in communities like mine, to the south of where I represent, to the north of where I represent—and Kiritapu Allan knows this; Meka Whaitiri knows this; they all know what's going on. Yet if I look on this paper—not a mention, not a mention of what we're going to do about forestry.
In closing, I want to talk about one issue of this bill which I particularly support, and that is around leasing of interests of less than 10 years where this threshold has reached into a single interest. I want to point out what this practically means in my own electorate. A significant number of horticultural operations and a significant number of international interests like Heinz Wattie's and McCain have a supply chain which relies on leases of farmland, and unless this bill is passed and it is changed—and I very much support this part—they have to apply for the Overseas Investment Office to renew their lease. Now, they are international corporates. They are employing thousands of people in my electorate. They're a wonderful company. They're using our land and resources on a lease basis—they don't own it—and there is a flaw in the law which this bill addresses. It's very costly, very disruptive, and above all it takes away a lot of confidence.
The other thing I want to talk about is water bottling, and the Hon Eugenie Sage has talked about it. Yes, in certain communities it is a hot button issue, but in other communities it's not. If you're on the West Coast and you get 5 metres of rain a year—and I'm guessing what the number is—and most of it goes from the mountains to the sea, if somebody wanted to come and set up a water bottling plant on the West Coast of the South Island and employ 1,000 people, you would get a very different result than you might get in Hawke's Bay. So I think we need to be very careful—very careful—how we control water bottling. I accept it's an issue, but in some parts—
ASSISTANT SPEAKER (Adrian Rurawhe): Order! The member's time has expired. This is a split call—[Interruption] Order! This is a split call. I call David Seymour—five minutes.





DAVID SEYMOUR (Leader—ACT): Well, thank you, Mr Speaker. I rise on behalf of ACT in opposition to this Overseas Investment Amendment Bill (No 3). In deciding to oppose it, I had to weigh up three things. One is that it is true there are elements of this bill that actually make it easier to get foreign investment into New Zealand, which ACT has always supported, for reasons that I've gone into detail in many speeches in this House, including the one given earlier this morning. In fact, ACT MPs have been doing that for about 25 years now. Number two, there are certainly parts of the bill that make it much more difficult for foreign investment to be brought into New Zealand. And number three is the question of change.
This is the fourth foreign investment bill or overseas investment amendment bill that this Government has brought in 2½ years. If you weigh those up, well, the things that make it harder to invest, "embedding a higher threshold for acquiring farm land, reflecting its significant economic and cultural importance,"—you know, what that means in practice is that it's going to be more difficult for the likes of Stephensons, who own a whole lot of land on the Central Plateau, to sell it and free up capital for other projects, such as a housing project in South Auckland. That's what happened to them. This restriction on selling farmland actually cost New Zealanders housing developments, because New Zealanders weren't free to use their capital that they owned freely under the laws set down by this Government.
It says, "enabling decision-makers to consider the impacts of investments [including] water bottling … bulk water extraction for human consumption [or] water quality and sustainability;". So hang on a minute. We have a resource management regime in this country that is supposed to mean that any kind of activity complies with environmental sustainability. That's what the Resource Management Act (RMA) says. Then we're saying there's going to be a different test if foreign investment's involved. Well, that's very interesting. The suggestion seems to be that somehow the RMA is not enough, and if that's true, we should be really worried about all the locally owned water bottling and extraction operations. On the other hand, if the RMA is adequate and we are properly managing the environments in New Zealand, why would we care who the investment was from on environmental grounds? So again, needlessly making the law more complex.
It says, "[provide] better recognition for Māori cultural values, including by taking into account plans to protect or enhance wāhi [tapu], wāhi tapu areas, and Māori reservations;". Well, that's all fine, but the problem is that this bill doesn't tell anyone how to do that, so there's going to be a new job interpreting what that means in the context of the Overseas Investment Act. Then it says a new regulation-making power so that at any time, a future Government can, by regulation not by legislation, do what the other bill being passed through the Parliament in urgency does. So those are the things that make it harder. On the plus side, you no longer need Overseas Investment Office (OIO) approval to buy land that's next to so-called sensitive land. That's sensible, but what's being got rid of is so ridiculous, it's difficult to know why they don't go further.
Then there's a couple of other administrative changes, but none of them make up for the fact that overseas investors are going to have to provide more information to the IRD. Who has ever chosen to invest in a country so they could have more intimate interaction with that country's tax department?
Overwhelmingly, the additional complexity outweighs any of the administrative easing in this bill. But there's another factor here, which is change. This bill is a fairly weighty thing—32 pages of new legislation—that I'm fairly certain will actually make the Overseas Investment Act longer, and that's the problem with legislation. Bills are like acorns: they grow. The RMA started off at 400 pages; now it's 900 pages, and the OIA is going in the same direction.
So the final reason for opposing this bill is not only do the new complications outweigh the simplifications, but having had four Overseas Investment Act amendment bills in only 2½ years, it is time to stop changing the law and hope that anyone who's still remotely interested in investing in New Zealand with this regime has some time to catch up. With that, I oppose this bill and I hope it falls under a new Government soon.





Dr DUNCAN WEBB (Labour—Christchurch Central): Tēnā koe, e Te Mana Whakawā. Well, the Opposition is struggling, really, to find things to oppose in this bill. We know that the National Party will be supporting it to select committee, and I suspect even Mr Seymour, floundering around there looking for things to criticise in it, will actually engage in some robust and constructive discussion at Finance and Expenditure Committee. It may be a change, but I look forward to it anyway. I'm forever the optimist. I mean, an objection on the basis that we're requiring details of investors to be given to the IRD, really? Does he really think that we ought not require information to be given to the IRD? 
David Seymour: Justify requiring more.
Dr DUNCAN WEBB: And Mr Yule needs to read the bill more carefully in terms of the leasehold land. He was quite wrong-headed in his criticisms of that.
And you know what? I love the criticism that David Parker has been too hard-working in getting this right. We have brought legislation to the House on more than one occasion because, absolutely, in terms of the first bill, we were going to stop foreign investors purchasing residential properties. New Zealand homes for New Zealand families: that was our policy there. We then had a bill which was disrupted by COVID-19, and that is largely what you're seeing in front of us now. So there are three bills, and the other one is the urgent bill—the bill to stop the vultures of international investment companies coming in and swooping and picking the bones of New Zealand businesses. I absolutely stand behind the hard-working David Parker, who has done more for international trade in 2½ years than that Government did in nine years.
This is a fantastic bill. It's easing the way for good investment. It's stopping poor investment. I support this bill. I commend it to the House.





Hon TODD McCLAY (National—Rotorua): Thank you, Mr Speaker. I'm not going to spend too much time at all speaking about the last speaker, Dr Duncan Webb, in this debate—otherwise, why not a sport analogy: when you're nowhere near the ball, you might as well play the mat. What we've just seen him do there is actually attack a speaker who has, in the debate—David Seymour—stood up and actually made very relevant points about the uttermost confusion that we see on the part of the three parties in Government when it comes to foreign direct investment and the role it plays in creating jobs in New Zealand. Rather than an intelligent conversation about that, the poor public, who are only just today really out of lockdown—I hope they're not watching TV, because they got 2½ minutes from that member.
The real crying shame of the debate taking place today on this bill is that when this Government has announced a Budget that will mean that every household in New Zealand will be responsible for an extra $80,000 worth of debt—and, indeed, when we look at the off-the-book debt that they're also creating borrowing for Housing New Zealand and others, it equates to maybe $63,000 for every single person in New Zealand.
Hon Member: How much?
Hon TODD McCLAY: Sixty-three thousand dollars for every child that's going to school on Monday of next week, $63,000 for every parent dropping that child at school, and if you pick a home in my electorate of five people, that is a generation or two generations of debt, more than $300,000—more than the affordable houses they said they would deliver and they've failed to.
The reason I say this is because, actually, the first two bills we're seeing in urgency are not about how to create jobs, they're not about how to help New Zealanders do better as they deal with the significant consequences of the economic impact of the lockdown from COVID-19, they're not about how to help them with their health, they're not about how to support their businesses; they are about telling investors from overseas that they're either welcome here or they're not welcome here. So the point here is the first two bills we have in urgency in the biggest-spending Budget the country has ever seen, a Budget that will mean there'll be $200 billion worth of debt, more than 50 percent of GDP—this Government is rushing through changes to the Overseas Investment Act, and I just think that's absolutely appalling, because every single New Zealander has sacrificed over the last eight weeks. They've done their part, and as they come out of their homes today to go back to their businesses, to open them up, to try and put them back together and make them survive, as they're hearing about the debt will be incurred on their behalf by this Government—they're turning on their televisions, and, in urgency, the first bill says it's actually harder for a foreigner to make a worthwhile investment in New Zealand that will create jobs.
But that first bill actually was an absolute waste of time, because, actually, it's only there, was it, for 30 days, or 90 days?
Rt Hon David Carter: Mere 10 days—Monday week.
Hon TODD McCLAY: No, no, but my point is it will be 90 days. So for 90 days, the Government has the right to veto an investment from overseas in a business they say is sensitive. Is there anybody in this country that imagines that, actually, an investment that triggers the Overseas Investment Act has ever taken less than 90 days? It's not possible. The system doesn't work that quickly, and therefore that was a waste of time, and it's virtue-signalling on the part of the Government to say they're protecting businesses in New Zealand, but at the same time the current system would protect it because it is so very slow.
And now we have another piece of legislation, the second bill in a row under urgency, of the Overseas Investment Act, and actually it says that it's making it easier to invest by taking away bureaucracy and red tape, but it's not doing that. If we look at the two pieces of legislation, one makes it harder; they're saying the other makes it easier. If no one in the country can work out whether the Government believes that foreign direct investment creates jobs or not, how can somebody that we hope to attract to invest in our economy, to invest in the productive parts of our economy—how could they work out whether this Government wants investment or not? I think that's what the shame is. 
There was a huge opportunity for this Government today in urgency, because we're here in the Budget, the biggest-borrowing Budget of the history of this country, to send a real signal to New Zealanders about what they really were going to do to protect jobs, to create jobs, to help businesses get back on their feet, to help them with their debt, to do anything for the tourism sector other than set up a ministerial group, an advisory group, to work out what the Minister should've been doing over the last eight weeks and will sometime in the future. They could've given more than hope to New Zealanders, but, sadly, they didn't. They've brought this back before us.
Here's a prediction: there'll be another bill straight after this one that won't do anything other than, I don't know, worry about a few people that may be smuggling a bit of tobacco into the country through the postal service, at the same time they've dropped $130 million to help the post office keep delivering letters as they work out what to do, I suppose. My point here is it's very confusing, their approach in this Budget, as to what they're trying to achieve.
The final bit—I don't know, what else would you do in urgency apart from this legislation to send a signal to New Zealanders about how serious they are about getting us back onto our feet? Why not a remuneration bill to give somebody the power to cut salaries for a very small group of New Zealanders? That could've been done two weeks ago under urgency in less than an hour if the Prime Minister delivered what she said to New Zealanders when she said she and her colleagues were giving up their salaries, but, no, that didn't happen. They rushed through a tax bill in two hours, and it was the wrong tax bill. We should be doing that.
ASSISTANT SPEAKER (Adrian Rurawhe): Which would be great in a general debate, but I don't think that's in the bill.
Hon TODD McCLAY: Well, I guess the point here is—
ASSISTANT SPEAKER (Adrian Rurawhe): So if you can reference that to something in the bill, that'd be great.
Hon TODD McCLAY: Yes, well, I guess the point here is that, actually, we are doing this bill, the Overseas Investment Act change, under urgency, and the problem that we have with that is actually it's not fitting of urgency, and neither are the other things the Government has brought forward. So my point here is that, actually, this is wasting the House's time, and the reason it's wasting the House's time—
ASSISTANT SPEAKER (Adrian Rurawhe): The fact of the matter, though, Mr McClay, is that we had the debate on the motion on urgency, and the House agreed to it. So if you could come to the bill, that would be appreciated. Thank you.
Hon TODD McCLAY: Well, in as far as coming back to the bill is concerned, not all parts of the House agreed to it, and so I'm making the case again that not all parts of the House agreed to this, and the reason we didn't agree to it is this piece of legislation is not fitting for urgency straight after the biggest-spending Budget in the country. The previous one wasn't; the next three are not either.
A couple of very important points here: the reason that I suppose the Government feels they have to do this is they need to send a signal that they are taking these things seriously, and in taking them seriously, it's evident to everybody that they made a mistake. One of the things they're tidying up, or trying to, with this legislation is looking at exactly the criteria required when farmland is bought, because everybody now knows that it's extremely difficult to buy farmland in New Zealand unless you want to plant trees on it. And, actually, what that suggests is it's not about supporting the forestry industry or not; it's having clear, consistent rules that actually bring the type of investment that we need to New Zealand. So if you are a foreigner who wants to invest in land in New Zealand, you could buy the best dairy farm in the country and you couldn't milk cows on it, but you could plant trees on it. That's not an efficient or effective use of investment or that land, and therefore this bill actually doesn't help that.
But I do notice that what it says is that, actually, one of the things it's clarifying—it wants to give New Zealanders equal opportunity as a foreigner to buy this land, so they're changing the way you must advertise it. I don't know about you, but the person in my electorate who's dropping their child at school on Monday morning and that child will owe $67,000 as a result of the debt probably is not so happy that they're changing the way this is advertised. I think that's a ridiculous use of urgency when we should be actually seeing things pushed through this Parliament in urgency that will make a difference to that mother and that child and the business they own and their livelihood.
The second thing this is doing is—I refer to the first bill that they went through the first stage of in urgency, because it was only for 90 days, but I see there's a clause here that says, after the 90 days, if this passes into law, they can re-enact those provisions without coming back to Parliament. So on the one hand, they're passing legislation under urgency that will give an opportunity for the Government to say no in 90 days and then to say no forevermore using those powers again under this. 
The problem with this legislation is it does nothing but tinker. It makes no significant change, it is confusing, it's not going to make New Zealanders better—if anything, it will detract investment, it will make them worse, and we will have fewer jobs here. We should be using the time of this House on things that are urgent, like creating jobs, protecting jobs, and reducing the debt of $60,000 on that poor little girl whose mother will drop her at school on Monday of next week, because that debt will be with her and her children for a very long time.





Hon SHANE JONES (Minister of Forestry): Why does the National Party want to sell off the birthright of all New Zealanders? Why does the National Party want to put on the international auctioning block the legacy of all New Zealanders? Why do they want to offer to people who do not have the same interests in the post-COVID environment as this Government does? Why do they want to use the COVID economic contagion as a further opportunity to pursue the privatisation of our legacy assets into foreign ownership?
That is exactly the tone and the content from the other side of the House. Now, of course, this bill affirms sensible foreign investment in New Zealand. This bill introduces a host of overdue changes that will simplify the process. The ACT leader talked about weeds growing, and analogised legislation to something akin to an acorn or a weed. This bill has the opposite impact. This bill will strip unnecessarily frustrating impediments from the road standing before foreign investors. It's going to actually de-weed the statutory process as we bring in sensible blends of foreign direct investment.
But I say to the other side of the House: we remember vividly all of the big opportunities squandered by them where we let legacy assets in the South Island be hocked off. Not a single word said from that side of the House. Our side arrived and said, as a part of the sovereignty of New Zealand, some things are worth fighting for. Some things are worth taking right into an election, coming out victorious, and passing legislation. This bill represents that. This bill says that, in the post-COVID environment, growing food, creating exports from the primary sector is essential. Therefore, if you are a foreign direct investor hoping to swoop in, for example, like the Tai Poutini West Coast dairy factory, those days are over. No more exploiting transitory distresses, distressing times, and denuding New Zealanders of these legacy assets. By all means, make an application if you are an applicant out there, but have no illusions: where farmland is concerned, and its incredible importance for export-based activity, you will go through a strong test.
Now, if the other side wants to change the law, they have to come to this House and change the law in the future—no writing letters at quarter past 9 in the evening to the Overseas Investment Office (OIO), wink, nudge, and opening up vast swathes of the country and actually causing the next generation a state of despair as they watch the productive sector of New Zealand dribble away, disappear into foreign ownership without any scrutiny. Those days are over.
Of course, I had a small contribution to make to the first phase of OIO reform, and I recall liberalising the OIO. Because certain foreign direct investment is very positive—incredibly important to the manufacturing sector, to the industries that will actually lift up the country out in our provinces and move forward. Now, our very clever colleague Mr David Parker ascertained that forestry and the usufructuary rights associated with forestry rights, associated with forestry, needed to go through a screening process, and two minds of great passion met—namely, his and mine—and we decided that if land was under 1,000 hectares, then it should be allowed to pass through the regime of the OIO. And, if you're bringing a proposal to expand the size of the New Zealand lung, then that type of investment—subject to a suitable level of scrutiny—was very positive for the provinces.
Now, it's very sad that members on the other side of the House have exploited that. They've manipulated the facts, and they've been a tremendously irritating source of misinformation up and down the East Coast and the West Coast. Fortunately, every time I point out to them that when they were the Government in the 1990s, 100,000 hectares of farmland was turned into forestry—that wasn't this side of the House; that was the grand-uncles of the other side of the House. Then, all of a sudden, we get a mild change, and that land that will probably create a greater level of public good by going into forestry, land consolidation, environmental resilience—that, they now want to attack. Well, who's actually selling the land? Who's actually putting the land up for sale? Garden variety Kiwi owners. Do you want us on this side of the House to actually trample upon those property rights of those owners as to whether or not they should be entitled to exercise it?
Greg O'Connor: Sounds a bit communist to me.
Hon SHANE JONES: Well, there's nothing so straight, nothing so recognisable as a capitalist who exploits a crisis to show how real socialism can be exploited to their private profit. Now, we overlook these lapses and inconsistencies in the arguments put by the other side of the House, which is why this bill will engender a great deal of support. It is not akin to some wild, crazy—
Hon David Bennett: $15 billion sold.
Hon SHANE JONES: Well, now we hear from Mr David Bennett over there. On the question of weeds, he would know the famous one in the Waikato, what's it—the broadleaf flea-brain, or flea-vein, or words to that effect, anyway.
Hon David Bennett: I raise a point of order, Mr Speaker. Now, that Minister has presided as the Government sold $15 billion worth of assets in his period of time, and then he attacks members on the other side of the House? He should stick to his debate.
ASSISTANT SPEAKER (Adrian Rurawhe): And your point of order is? That's not a point of order. That is a debating point that members are debating.
Hon SHANE JONES: Sir, I do need to correct my contribution. The description of the hairy buttercup is more akin and more apposite for the contribution coming from that member from around Hamilton. However, the House has rediscovered part of its mauri, the liveliness. The Budget has well and truly been acclaimed up and down the country. And without a doubt, Mr David Carter, without a doubt, spoke great truth. He said as this bill goes forward, he won't be around. You can put money on that, because a host on the other side of the House, as I commend this bill, after 19 September will definitely not be around.





A party vote was called for on the question, That the Overseas Investment Amendment Bill (No 3) be now read a first time.
Ayes 119
New Zealand National 55; New Zealand Labour 46; New Zealand First 9; Green Party of Aotearoa New Zealand 8; Ross.
Noes 1
ACT New Zealand 1.
Bill read a first time.
Bill referred to the Finance and Expenditure Committee.





FORESTS (REGULATION OF LOG TRADERS AND FORESTRY ADVISERS) AMENDMENT BILL
First Reading
Hon SHANE JONES (Minister of Forestry): I move, That the Forests (Regulation of Log Traders and Forestry Advisers) Amendment Bill be now read a first time. I nominate the Environment Committee to consider the bill. At the appropriate time, I intend to move that the bill be reported to the House by 5 June 2020 and that the committee have authority to meet at any time while the House is sitting (except during oral questions), during any evening on a day on which there has been sitting of the House, and on a Friday in a week in which there has been a sitting of the House, and outside the Wellington area, despite Standing Orders 191, 193, and 194(1)(b) and (c).
I stand to explain to the House why we are proceeding with the forests amendment bill for the regulation of log traders and forestry advisers. This speech will begin by painting a picture of how incredibly important this third-largest export earner is for provincial New Zealand, for the manufacturers of New Zealand, and for the workforce of New Zealand. For far too long, this is an area that has existed with minimal oversight, and we have heard a host of very sad stories about the quality of the advice, the quality of the conduct, as is evidenced by some of the ways in which both advisers and logmongers have behaved.
Therefore, to complete the virtuous circle of forestry, this Government has introduced the billion trees kaupapa, dedicating nigh on $500 million over a period of time to achieve the outcome of having planted one billion trees, for a host of purposes. Purpose number one is to expand the size of the nation's lung and to provide us with an option to manage the transitional costs of climate change. Purpose number two is to invest in biodiversity by ensuring that the trees that are planted under our Government's programmes are a mix of exotic and native, and that such activities generate positive outcomes in terms of sustainability.
Purpose number three is to have decluttered the overseas investment regime so that those who already own the forestry estate in New Zealand—well over 73 or 74 percent of that estate is already owned by foreign interests. They approached me and requested that we declutter the legislation back in late in 2017, and the outstanding area is to give confidence that the manufacturers, the downstream processors, the domestic sawmillers, the owners of the timber processing sector have greater confidence that they can enjoy ongoing access in a predictable and consistent form to the raw material, so that their businesses can grow, their employees can stay on the job, and we do not see mountains and mountains of raw commodities disappearing overseas without us as a nation creating additional value from so said resources.
So this bill reflects considerable work out in the community by our officials, but it also shows that when we're focused on creating a plan for an industry with the leaders of the industry, we can deliver. This bill will go through the airing process at the select committee, and where there are concerns, potential imperfections—hard to imagine—they can at least be addressed by the select committee, and the arguments rehearsed as to whether or not there's too much forestry in New Zealand, not enough forestry, and whether it's a reasonable type of investment. All of that can be trotted out at the select committee, and the bill then can come back and we can develop a registration system.
Now, why would you want such a system? Well, in a host of areas, the quality of advice being offered to our investors in the forestry sector has been substandard. My office and a host of other MPs can attest to this. There have been some very sad and egregious cases where dodgy advisers have been allowed to get away with dodgy conduct for far too long.
Now, some might say it's the market—it's the laissez-faire system; don't interfere with it—but we as the Government have an interest in professionalising and creating a greater level of resilience and robustness into forestry, creating a system that ensures that the logmongers offer the raw material both to Kiwi processors as well as to international buyers. Now, this does not offend any World Trade Organization ruling. I did actually toy with the idea that there should be an export tax. Now, obviously, we wouldn't head in that direction if it created an impression that not only were we taxing exports but it might invite retaliation. But I say to you that we are going to face up to 300,000 of our young people and our neighbours facing unemployment as we come out of the COVID medical contagion. Many jobs can be created in this forestry sector, but the investors need certainty and confidence that they can gain access.
What's the point of continuing to plant trees in provincial New Zealand if those trees are not available for manufacturing and processing on a predictable, consistent, and calculable manner? This bill will create that. This bill will enable people to go through a registration process. There will be suitable exemptions, and it also will allow for complaints to be made. It will be run in a very efficient manner. We will not be tolerating excessive levels of bureaucracy, and, as a consequence of having an efficient system, once it's established, it can actually be delegated outside of the core Crown into another entity. But the main point is that people receiving advice from forest advisers need to know that the advice has integrity and there's a complaints process if they have been diddled. People that are logmongers must make the material available to both Kiwis and international purchasers.
Now, those international purchasers may or may not have subsidies buried in opaque arrangements overseas. This bill does not deal with that. But this bill makes it absolutely crystal clear to the people who are managing the logmonger business or forestry advisory services that you have to take account of climate change, you have to take account of the needs of domestic processors, you have to take account as to whether or not the land being used would be best suited for forestry. And, after all of that, if the advice is found to be egregiously defective, then there will be a complaints process. But there will be a clear obligation, as a consequence of this bill, for people to have demonstrated that they have made the raw material available to Kiwis.
There's no guarantee Kiwis will buy it. There's no guarantee that Kiwis will want it at all times, but they will have the option. They won't sit watching large trucks taking all of our valuable raw material offshore while Kiwis become further unemployed and businesses cannot gain certainty in terms of gaining not only calculable but predictable flows of raw material. Now, who can dislike that? In a post-COVID environment, this is going to be absolutely essential.
So, to round up, forestry policy, the forestry industry, is now very robust. We have rehabilitated the reputation of that industry. We have put that industry on a far more secure footing. We have used the $500 million - odd over time to regrow both the status and the human capital. We are attracting financial capital into forestry. This regulates, this enables, a process to be in place where grievances can be dealt with, the integrity of advice can be relied upon, and those who are in the business of buying and selling logs can no longer turn their backs on their fellow Kiwis and chase the speculative spot price overseas only to come crying to the "First Citizen of the Provinces" when that spot price collapses.
So we're going to achieve not only consistency but there are going to be legal obligations, and those obligations will be spelt out in the form of a practice standard, and those practice standards will impose enforceable duties on the people that are registered through this scheme. If they are not registered and they are circumventing it or trying to use it for money-laundering purposes, and the rumours are rife, they are going to be caught. That is why I commend this bill to the House. It represents fixing a neglected area in the forestry sector, increasing robustness, resilience, integrity, and ensuring that the owners of forestry resources can rely on the advice and that the owners and the workers in processing can have great confidence that the raw material will be made available. I commend this bill to the House.
ASSISTANT SPEAKER (Adrian Rurawhe): Before I call Mr Muller, can I ask the members on the Government side to remove the red boxes, the green boxes—there's one at the front there. If someone could grab that, please?





TODD MULLER (National—Bay of Plenty): Thank you, Mr Speaker. I rise to speak to the Forests (Regulation of Log Traders and Forestry Advisers) Amendment Bill. What an extraordinary Government priority this is. I mean, with respect, we have had this afternoon a finance Minister speak to this House and say that the Budget deficit for this year is just short of $30 billion. In the same speech, he says that the deficits for the next four years will total $100 billion. And, in a moment of national crisis, he outlines the priorities that his Government will now put forward in urgency in front of this House, and apparently this bill, the regulation of log traders and advisers, is the third-most important bill facing this country in our time of national crisis. Well, get a grip. How on earth, Mr Jones, did you manage to pull that swiftie? Even Eugenie Sage can't look at you. Mind you, she can't anyway, but she particularly can't now. What an extraordinary bill we've been served up. So, ladies and gentlemen at home, who I know will be wondering, after the two performances from my colleague across the other side, whether we have descended into Shakespearian farce; we haven't. The National Party is here to put some rigour back into it.
So what does this incredibly urgent bill, as we look at a sea of $100 billion worth of deficits in four years—what does this do? It establishes a registration system for log traders and farm advisers. It allows the Ministry for Primary Production to set up a regulatory body. It sets up a registration process. It sets up a power to obtain information. It defines—Mr Jones would have spent years doing this—a log trader. That's very important! It requires them to adhere to forestry practice standards. It specifies the application form—specifies the application form! That's two pages. I'm glad Eugenie Sage is looking down again. It outlines the conditions of registration that can be imposed. It has a section on cost recovery. It sets up a regulation-making power for registration complaints and disputes, fees and charges and levies, and then the rules themselves. I mean, this is quite unbelievable that this Government has put this in front of us.
And what is interesting is that the speech the Minister gave was, as he has always given, a speech that is focused on his particular view that the sector is broken, that it's inappropriate to respond to export market prices, that somehow the role of Government is to get in the middle of it and turn the market upside down and pick winners—that that is the best model—and he talks about how that's going to get turned on its head by this bill. Of course, none of that detail is in the bill, Mr Jones. All it does is set up a framework, and what you're doing is signalling to all the foresters that, actually, this is where you want it to go.
Well, what's fascinating about this is that Mr Jones says this has been out in the field for a number of years, that he's had close conversations with the forestry sector. Well, they haven't seen it. In fact, they're only going to get briefed on it tomorrow. And here he stands, saying that this is an urgent debate, an urgent priority, for something that hasn't been seen by the sector—hasn't sat down with the forest owners, hasn't sat down with the contractors or the small-forest owners. He actually hasn't sat with them and said, "This is what I would like to do in your sector." And not only that; he has the audacity to come and say that all this now can be discussed, debated at a select committee, and reported back in three weeks. Well, that is arrogance in the extreme, and we are seeing yet again the fusion between a man with the particular view on a model—he wants to see an economic model that he controls rather than the free market, he has a view that it's his way or the highway, and he creates this impression that somehow this has been worked through with the sector when it hasn't.
Then the final ignominy, which of course is making my counterpart look down at the floor, is that he stands up here and says that this is the appropriate purview of the Environment Committee. Goodness me! Forestry, agriculture—Mr Jones, they're the same industry. There is no reason for this to go to the Environment Committee. I mean, the Primary Production Committee, for a start, is superbly chaired. I don't think there's a better chair that we've ever seen in primary production. To be fair, there's some reasonable contributions from the other side. Every now and then Kiri Allan gives us the impression that, you know, she's on the same—
David Seymour: She's one of the smart ones.
TODD MULLER: Yes, one of the smart ones. Future leader there, probably. Hey, this really, from our perspective, is quite surprising.
Now, of course, the question is: do we support it through to first reading?
Kiritapu Allan: Course you do.
TODD MULLER: And, from our perspective—a close-run thing—the reason we are supporting it through to the first reading is because, to all those forest owners watching, to all those contractors, to all those small-forest lot owners, when you are looking at this, at least you know that we will be able to facilitate with you a select committee process where your voice will be heard. He didn't even want a select committee process; he wanted it in urgency, but we have at least an opportunity where the National Party will be able to hear your perspective. Now, it won't be the Primary Production Committee; it will be the Environment Committee. It will be Scott Simpson. But you'll get a good hearing, and you'll get a National Party that will ask the right questions and expose what actually sits behind this, which is another Shane Jones crusade.
Kiritapu Allan: It's the economy, it's jobs, and it's regional provincial growth.
TODD MULLER: You'll get your turn—you'll get your turn, Kiri.
So I just want to conclude by saying: for all those watching, who are no doubt leaning into the television, wanting to say, "What, at our moment of national crisis, is the most important thing that the Government is focused on?"—half past nine, a few hours after the worst Budget, in terms of financial position, that we've ever seen in our lifetime—be assured that this Government's view that the third-most important piece of legislation that should be prioritised above anything else is the registration of those who export logs and those who provide advice to those who grow trees. Thank you.





Hon DAMIEN O'CONNOR (Minister of Agriculture): Mr Speaker, look, thank you very much, and I welcome the opportunity to speak after Todd Muller, the last speaker. There's a saying "Be careful what you ask for", and that member's asking to be Leader of the Opposition. Indeed, I predict that he will get there, and he will stay there for a hell of a long time, because, if that's an example of how he and the National Party, as the primary industries spokesperson for the Opposition and the National Party, completely discredits the third-largest export earner for this country, and an industry that he is supposed to be advocating for, I'm ashamed—I'm ashamed.
If ever there's a difference between what this side of the House, this coalition Government, advocates for, and it's for forestry—I congratulate my colleague, the New Zealand First member the Hon Shane Jones, because what he did was finally set up Te Uru Rākau, a ministry for forestry. I was in this House when Dr the Hon Lockwood Smith proclaimed huge savings—if I can remember, it was $4 million a year—to merge agriculture and forestry. He thought of all the efficiencies, and what that did was that forestry got lost from that time onwards. It got absolutely ignored, and so this coalition Government came in and set up Te Uru Rākau to advocate.
The other difference between a party that claims to advocate for the primary sector and the forestry sector, and a Government that works for them is that we are advocating for foresters, for producers, for manufacturers, and for the good people who work in those industries, and that party advocates for traders. They advocate for traders—that's what John Key did—and this party, the National Party in Opposition, continues to advocate for traders over the people who produce the wealth, because they believe that, actually, the path to prosperity is clipping the ticket. What this piece of legislation does—just as last time in Government, we regulated real estate agents, other friends of the National Party, people who were not always committed to ethical practice and who needed proper regulation to ensure that their customers got a fair deal. Well, that's what we're doing now for the third-largest export sector in this country.
Good, well-meaning, honest Kiwis who seek advice and invest, often, their life-savings for some kind of superannuation scheme invest it in the forestry sector, hoping that, in 30 years' time, or thereabouts, they will have proper, respectable, reasonable returns on their life's work and their investment. Well, they go to people—because they don't know a lot about forestry—and they get advice on how they should invest, and sometimes that advice is not always good.
Indeed, I'll quote a tradesperson in my electorate, who came to me saying that they'd had advice. He has a successful business with his wife and employs a number of people. They had invested in forestry, and they'd sought advice on the emissions trading scheme and how that might affect the price of carbon and what they should do. They'd been advised that they could seek annual income from their forest plantings at a carbon rate—I'm not quite sure what it was—and that that was the best way forward and the most secure way for them over a 30-year period. Then, what they had not been told was that at harvest time, of course, they were liable for the carbon credits, and so this person was asking me what could be done. Well, I was tempted to say that Mr Jones and this Government are doing something about it, because the traders, who are the mates of the National Party, will just say what they like, do what they like, and clip the ticket, and good honest Kiwi investors lose out because of that bad advice.
So we're going to have some ethical practices. We're going to have some standards put in place. We're going to ensure that people are fit and proper to offer advice, just as we have done for financial advisers and just as we had to regulate for real estate agents, because if we don't, then, in fact, we will have too many hard-working Kiwis—the people that the National Party say they advocate for. They don't; they advocate for the traders, over all else. We want to advocate for good honest Kiwis—the people who have the forests.
The emerging reality—and I guess the House has heard before of the high level of foreign ownership here now across the forest sector, but the profile of forest owners and the supply of wood, moving forward, is changing. It is changing quite rapidly, and I have to acknowledge Hamish Levack. He's been a local person advocating for forestry for a long, long time, and he came to this House and was talking to a number of MPs, myself included, about what was the challenge with the wall of wood, the changing profile of forest owners, and how were we going to offer security to all those people who have invested hundreds of millions—or, in fact, billions—of dollars in processing across this country. How are we going to protect their supply of wood and, indeed, protect the small - wood lot owners when it comes to selling their trees? His proposal was, in fact, a cooperative. I support cooperatives, and I think, eventually, enough of those small-forest owners might work out the wisdom of coming together in some kind of supply cooperative that gives guaranteed volume to the manufacturers and the processors and gives them a fair return for their 30 years of investment.
In the meantime—
Todd Muller: Well, they can do it now—they can do it now.
Hon DAMIEN O'CONNOR: They can do it now—of course they can do it now. But the problem is that many of those small-forest owners go and seek advice. So why would a forest adviser tell them to go into a cooperative when there's another old saying that says "Divide and rule"? If you can just feed enough information to people and make it look credible, sometimes you can carry them along. What this does is ensure that the people providing the advice—as I say, as we do across other parts of the economy—are fit and proper. This piece of legislation in a laissez-faire world, where there was fair, open trade and people had all the information, might not be necessary. The realities of this world are that it's not always like that.
Today, we passed a Budget, or the Minister of Finance did, with the Government, that was about jobs, and the previous speaker, the so-called champion for the primary industries in the National Party—the so-called champion for the primary industries in the National Party—got up and said, "What connection has a piece of forestry legislation to do with the Budget?" Well, let me explain it really carefully to you: this industry is the third-biggest earner of export revenue in this country, and that is important when it comes to creating wealth and building our economy again. Don't you get that? Don't you understand that, over there? No, I don't think they do. You can't just create wealth out of trading. You can't just create wealth out of trading; you've got to have people who commit real money to real production and create real things and export it.
Can I say that the 15,000, or thereabouts, of small-forest owners need a fair go. They need people who are going to give them fair and honest advice, and this registration process will do that. We also need to know that the people who have invested billions in manufacturing the logs that we cut down into more valuable products—we have to know that they get a fair chance of getting at wood supply. This is why we want traders who are honest, who commit to contracts, and who will supply the logs, because I get sick and tired of looking from the 19th floor of Bowen House down on to a wharf full of logs that constantly flow out of this country, when we need jobs in this country now. We need jobs, and in the third-biggest sector for export earnings—I have to say, why not start at forestry? Why not start with the job opportunities in forestry? So this Government is moving on it.
So, to the previous speaker, who could not understand why we would have a piece of forestry legislation in the House on the same day as the Budget: just go and look at the export revenue figures—go and understand what responsibility you have in your role as spokesperson for the primary industries, because, if you can't do that job properly, you certainly won't do the Leader of the Opposition's job very well, either.
I'm proud to stand in this House and support this piece of legislation to support good honest Kiwis in one of the most important industries in this country.





ALASTAIR SCOTT (National—Wairarapa): Thank you, Mr Speaker. Here we are discussing the registration of advisers and log purchasers—those who might want to purchase a log. That is the priority for this Government at this time on Budget day in urgency. I mean, I thought we had urgency for really important things; things that had to be done in a timely manner to kickstart a process because it was urgent. This does not qualify for any reason, to be urgent. This does not actually create any new jobs. We're talking about a large industry. This is going to see those levels of exports that we've talked about being so important decline—the value of those exports will be declining because of the costs that are layered by this piece of legislation.
There is no need for this legislation. This legislation is telling the industry that they're idiots. This piece of legislation is telling the associations in the forestry sector that they don't know how to conduct their own business. This piece of legislation is telling small, medium size, and large-forest owners that they're fools and that they are not capable of seeking advice from reputable advisers, taking that advice, and managing their forests.
This sector has been around for a very, very long time. The wall of wood that we are seeing now was planted in the 1990s—and, of course, we had a thriving forestry sector before that. These syndicates that are small-forest owners have been around a long time. They've trusted, they've had legal advice, they've had financial advice at the time, knowing the risks, aware of the commodity-based product that is a log—that is a log. The log is always going to be subject to commodity pricing because that's what it is. It's like orange juice. It's like milk powder. It's like wool. It's a commodity. The price of it rises and falls with demand and supply.
If we're going to register and direct logs, a commodity, into a processing facility because of the tax that Mr Jones talks about, we are in big, big trouble. If we start taxing our exports, that is only going to put our price of that commodity up to the international purchaser, and that international purchaser will go elsewhere. We will see less exports when Mr Jones introduces—
Hon Shane Jones: Jobs, jobs.
ALASTAIR SCOTT: —his export tax. He justifies it by saying there will be jobs as a result. He's suggesting that we need more wood processing in New Zealand. Well, there's a list of associations in New Zealand that, for some reason, Mr Jones doesn't think talk to each other. There's the New Zealand Farm Forestry Association: 27 branches around the country, been around for 50 years—that's the New Zealand Farm Forestry Association. There's the Forest Owners Association. There's the Wood Council of New Zealand. There's the Wood Processors and Manufacturers Association. Apparently, these guys are all idiots; they don't really know how to run their business! They're being told to work closer together—"Otherwise we'll tax you." There's the Forest Industry Contractors Association, and there's the New Zealand Timber Industry Federation. There are a lot of smart people out there. They've been in the business. They know what they're doing. They're not interested in having a layer of compliance, an obligation, to restrict their markets by being forced to put their logs in this processing factory or that factory.
Those processors are not asking for subsidies from the Government. They're not asking for what Mr Jones is suggesting. They're not asking for an export tax; that's all his idea, and it's ludicrous. Let's put it on wool, shall we? To force the sheep growers to process wool in New Zealand—well, that's a ridiculous suggestion. Why don't we put it on milk powder? That's a commodity. Why don't we put a tax on milk powder to stop people delivering it as a raw commodity into the offshore market? Why don't we tax it so that we can process it into cheese and yoghurt in New Zealand? Why don't we do that? What a ridiculous idea that would be. And so it is with forestry. It is exactly the same argument. Taxing an export will only incentivise people to stay away from it. The cost will be too high, and they'll walk away. Margins will be eroded, jobs will be lost, and the economy goes down the toilet as a result of the policy that Mr Jones is suggesting.
There is no need for this registration—registration for what? I mean, what are we going to do, register—OK, we've got financial advisers that are registered and real estate agents that are registered; that's been mentioned tonight. Why don't we register car salesmen? Why don't we do that to make sure that they're all satisfactory and of good character. Why don't we do that? I'll tell you what: why don't we have a gun register, see if that works? Oh, no, that's right—they've already tried that idea and that's not going to work, either. Registration is a layer of cost that is totally unnecessary. It's patronising to the industry. The industry do not and have not asked for this. They do not need it. The processors do not ask for it. The logging sector is not asking for it. The small foresters are not asking for it. And, in fact, the reasoning in this bill—that the small foresters will account for a larger proportion of logs coming to the market—is not correct. I've seen contradictory numbers to say that those small operators who planted in the 1990s are harvesting now and will not be such a large influence in 10 years, as the document in the bill suggests. So that's the registering of the advisers.
Why on earth do we have to register someone who is buying something? Why do we have to register a purchaser of a log? So the purchaser who will process or export—well, you can't do much else than either process or export. So every purchaser of a log has to be registered. Why logs and not, I don't know, anything? Cars?
Hon Shane Jones: Repetition.
ALASTAIR SCOTT: Well, no this is about the purchasing side—this is about the purchasing; registration of the purchaser. I've spoken about the registration of the adviser; this is the ridiculous idea of registering someone who wants to buy something. I don't even need to say any more, it's such a ridiculous idea. Why would you want to or need to register someone who's going to buy a piece of wood down at Mitre 10? Buy a log, buy a sheep, buy a cow; why don't we register everyone who wants to buy something? This is a scary, lefty, sort of—
Hon David Bennett: It's communist.
ALASTAIR SCOTT: —communist sort of policy that's creeping in. We're suggesting export taxes. This bill is a crazy prelude to something that seems to be coming our way, which is even more scary than this bill.
This is not an urgent piece of legislation; it's not even useful legislation. It's totally redundant legislation, and it is unwanted legislation. However, we will support it to the select committee to allow—
Hon Members: Ha, ha!
ALASTAIR SCOTT: Well, you'll hear it from the people. We will hear it from the people, we will hear it from the advisers, we will hear it from the associations, and we will hear it from the processors that this is not a good piece of legislation.





RINO TIRIKATENE (Labour—Te Tai Tonga): Thank you, Mr Speaker. I'm delighted to speak in support of this bill. As we are entering a very challenging post-COVID environment, we need to have robust legislation in place to support our industries and strengthen our third-most important export industry—the forestry industry: log, wood products. Can I congratulate our Minister of Forestry, the "First Citizen of the Provinces", the Hon Shane Jones, son of the North, Tāne Māhuta-esque in his towering figure in this Parliament in support of his beloved forest industry.
This is a very, very welcome piece of legislation, and I'm surprised that the member that's just resumed his seat, Alastair Scott—I'm glad that the National Party, despite all their moans and groans, are supporting this bill at its first reading. I know the member from the Wairarapa. I'm sure those great pioneers of investment forestry Charles Wallis and Steve Wilton, those great persons from over the Wairarapa, would have been whispering to him that, yes, we should get behind and support this bill. So this is a welcome piece of legislation.
It is needed because the fact of the matter is there are unscrupulous, dodgy traders that are operating in the forestry sector. They are distorting the market, and they are, basically, fooling a lot of the farm forest owners and they are denying the supply chain of an important harvest of crop. So this bill is all about ensuring there's a consistency in the supply chain. Yes, the top dollar will be achieved in terms of the export markets, but this approach, this registration of the traders and of the advisers, is to ensure that there is an adequate supply that is available to the local processors, local sawmillers, and the important jobs that those small businesses and those larger businesses have, particularly in our provinces. So this is a very welcome piece of legislation.
I also want to congratulate our Minister for primary industries, because the Ministry for Primary Industries, Te Uru Rākau—they play a very important role in this legislation as the forestry authority, and they will be crafting and ensuring that the registration requirements will be in place and all the detail will be set out in regulations, which will be forthcoming as well, in discussions with the industry. And this has actually been requested by the industry. The industry actually have been engaged, have been working with the Government officials, and this has very wide support.
So it's very important that we put this in place. It is about jobs. It is about ensuring consistency of supply, availability, to ensure that we have those sawmillers, those wood remanufacturers, those processors—they need to have that supply of wood, not denied that supply by a dodgy trader from South Asia, or wherever, who can come up with a price on the back of a cigarette pack. Those sorts of traders are not welcome in our industry. They offer no value, they have no investment, and they demean and they devalue and they actually deter investment coming into our industry. That's why it's important that we have that assurance across the industry, across especially the emerging sector of farm foresters and private, smaller landholding, smaller harvestable crop owners. It's very important that they have certainty that the advisers that they will be seeking and the contractors and the ultimate sale of their logs—yes, they will be able to achieve a good price, but it will be benchmarked and it will ensure that a relevant portion is available to support our local industries.
So, with that, I once again want to congratulate the Minister of Forestry. This is a much-needed piece of legislation, and I'm really looking forward—I'm saddened that it's not coming to the Primary Production Committee. We were all prepared for this particular bill, but I'm sure that the Environment Committee will be giving it due consideration as well. So, with that, I commend this bill to the House.





Hon DAVID BENNETT (National—Hamilton East): Thank you, Mr Speaker. I just want to take a little speech to start off with this, because this shows the idiocy of the New Zealand First economic plan. They are nationalising forestry and telling people how they have to sell their products. It is all because they want to see those products being processed in New Zealand. The reality is they are not processed in New Zealand, because of the requirements that that Government puts on industry, the costs it puts on industry, and the environmental costs that don't make it profitable to do it here. The most profitable use of those logs is to send them overseas, just like our milk powder—the most profitable use is to send it overseas.
They are trying to nationalise a market. That is what they are trying to do, and it will not work. It will create inefficiencies in the forestry market. It will create a sense of inefficient investment, and it will hurt forestry long term. Forestry needs to be able to make commercial decisions as a business and not have Shane Jones tell them who they should sell their product to. He does not make the right decisions. He has not got that power. It is up for business people and planters to do that, not for Shane Jones to dictate what happens to their products. That is the nationalisation process that the New Zealand First Party and Labour Party and Green Party stand for, and it will not work, and it is a very good indication to the public of New Zealand. Do not let these guys run this country. They will destroy our economy. They will destroy our business base, because they will put inefficiency into business. They will make businesses make decisions to actually fulfil a Minister's whims rather than making profit and actually delivering—
ASSISTANT SPEAKER (Adrian Rurawhe): I'm sorry to interrupt the member, but it's come time for me to leave the Chair for the evening. The House will resume at 9 a.m. tomorrow morning.
Sitting suspended from 10 p.m. to 9 a.m. (Friday)