"\u003C!DOCTYPE html\u003E\u003Chtml xmlns:xlink=\u0022http://www.w3.org/1999/xlink\u0022 xmlns:xsi=\u0022http://www.w3.org/2007/XMLSchema-instance\u0022 xmlns:mml=\u0022http://www.w3.org/1998/Math/MathML\u0022\u003E\n  \u003Chead\u003E\n    \u003CMETA http-equiv=\u0022Content-Type\u0022 content=\u0022text/html; charset=utf-16\u0022\u003E\n    \u003Cmeta name=\u0022viewport\u0022 content=\u0022width=device-width, initial-scale=1\u0022\u003E\n  \u003C/head\u003E\n  \u003Cbody style=\u0022font-family:sans-serif; font-size:100%;\u0022\u003E\n    \u003Cdiv class=\u0022HpsHansard\u0022\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000001\u0022\u003E\u003Cspan class=\u0022HpsProceedingHeading\u0022 id=\u002202efddf060b9459b96b515283e68a5b3\u0022\u003ETuesday, 24 October 2006\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000003\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u002276a9289d54244381a0e77b3a4a091547\u0022\u003ETuesday, 24 October 2006\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000002\u0022\u003EMadam Speaker took the Chair at 2 p.m.\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000004\u0022\u003EPrayers.\u003C/p\u003E\n    \u003C/div\u003E\n    \u003Cdiv class=\u0022HpsHansard\u0022\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000005\u0022\u003E\u003Cspan class=\u0022HpsProceedingHeading\u0022 id=\u002277c1b48ae93a431eb52d14bcb4ce0b1b\u0022\u003EMotions\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000006\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u00227681d85151ac4dafb3db9c8b613e8f5b\u0022\u003EHungarian Revolution\u201450th Anniversary\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022b8383f38-c78c-4e5d-8324-677d91e95c49\u0022 data-id=\u002280c30a0dbf1848b0a76e49de3b40e37f\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000007\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b8383f38-c78c-4e5d-8324-677d91e95c49\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002280c30a0dbf1848b0a76e49de3b40e37f\u0022\u003EKEITH LOCKE (Green):\u003C/span\u003E I move, That this House \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000008\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b8383f38-c78c-4e5d-8324-677d91e95c49\u0022\u003E(1)\tcommends the Hungarian people as they mark the 50th anniversary of the October 1956 Revolution, which set the stage for the democratic changes which occurred in 1989 in Hungary and other Eastern European countries; \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000009\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b8383f38-c78c-4e5d-8324-677d91e95c49\u0022\u003E(2)\texpresses its condolences to the people of Hungary for those who lost their lives fighting for the cause of Hungarian freedom and independence in 1956 as well as those individuals executed by the Soviet and Hungarian authorities in the 5 years following the Revolution, including Prime Minister Imre Nagy; \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000010\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b8383f38-c78c-4e5d-8324-677d91e95c49\u0022\u003E(3)\twelcomes the achievement of democracy in Hungary in 1989, and the progress its people have made since then; \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000011\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b8383f38-c78c-4e5d-8324-677d91e95c49\u0022\u003E(4)\treaffirms the friendship and cooperative relations between the Governments of Hungary and New Zealand, and between the Hungarian and New Zealand people; \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000012\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b8383f38-c78c-4e5d-8324-677d91e95c49\u0022\u003E(5)\tnotes that over 1,000 Hungarian refugees came to New Zealand after the Revolution was crushed by Soviet forces; \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000013\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b8383f38-c78c-4e5d-8324-677d91e95c49\u0022\u003E(6)\trecognises the significant contribution of the Hungarian community to the progress of New Zealand over the last 50 years; and \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000014\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b8383f38-c78c-4e5d-8324-677d91e95c49\u0022\u003E(7)\tasks the Speaker to convey this motion to the Speaker of the Hungarian Parliament.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000015\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b8383f38-c78c-4e5d-8324-677d91e95c49\u0022\u003EMotion agreed to.\u003C/span\u003E\u003C/p\u003E\n    \u003C/div\u003E\n    \u003Cdiv class=\u0022HpsHansard\u0022\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000016\u0022\u003E\u003Cspan class=\u0022HpsProceedingHeading\u0022 id=\u0022ef40aad2700e4e61bf2c5eaa1beb0449\u0022\u003EPoints of Order\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000017\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022f81932d67dd446928e3b691b39663229\u0022\u003EBehaviour in Chamber\u2014Bob Clarkson\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022e6b4dc55-3561-49a8-a871-ae005354ef90\u0022 data-id=\u00223b2cae232f2c4ccaba3261e1d3bd125d\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000018\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e6b4dc55-3561-49a8-a871-ae005354ef90\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00223b2cae232f2c4ccaba3261e1d3bd125d\u0022\u003EGERRY BROWNLEE (Deputy Leader\u2014National):\u003C/span\u003E I raise a point of order, Madam Speaker. We note you have taken, we think, the unusual step of writing to Mr Clarkson to tell him that he has been out of order in holding up signs and other stuff in the House, and in suggesting that he might wear a crash helmet in the House today. We would hope that you have written to Mr Mallard, the Deputy Prime Minister, the Prime Minister, the Labour whips, and everybody else here who have been waving signs around this House quite liberally in the last couple of weeks. We ask you to indicate to the House whether that is an action you have taken. Further, we offer the view that had Mr Mallard not gone out of his way last week to be in the near vicinity of Mr Clarkson, clearly Mr Clarkson would not feel the need to wear a helmet today.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000019\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022022cfe6b-bae4-4028-b68a-ccffb4269442\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ce650ea9c56b4b5ea1dd8b6490d63919\u0022\u003EMadam SPEAKER\u003C/span\u003E: I thank the member for his comment. Obviously, the latter matter he raised is a matter of privilege that has been raised with me, and is under consideration at the moment. The other matter was outside the Standing Orders. Members on all sides of the House from time to time raise visual signs to assist their questions or answers. Mr Clarkson\u2019s position was in a totally different category from that.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000020\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022e76a40108b0a487388a08bad7a7d1ba2\u0022\u003EVisitors\u2014Hungarian Honorary Consul and Members of Hungarian Community\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022b8383f38-c78c-4e5d-8324-677d91e95c49\u0022 data-id=\u0022283686926f9144e3ae267ffe03dfba6f\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000021\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b8383f38-c78c-4e5d-8324-677d91e95c49\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022283686926f9144e3ae267ffe03dfba6f\u0022\u003EKEITH LOCKE (Green):\u003C/span\u003E I raise a point of order, Madam Speaker. I have one point in relation to my motion earlier. I think it might be appropriate, on the occasion of this very important anniversary, to recognise the presence with us today of the Hungarian Honorary Consul in New Zealand, Klara Szentirmay, and other members of the Hungarian community.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000022\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022022cfe6b-bae4-4028-b68a-ccffb4269442\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00223b59190daaa64a5e905f9c714dacdd5e\u0022\u003EMadam SPEAKER\u003C/span\u003E: If members wish to acknowledge their presence, please do so.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000023\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022022cfe6b-bae4-4028-b68a-ccffb4269442\u0022\u003E[Applause]\u003C/span\u003E\u003C/p\u003E\n    \u003C/div\u003E\n    \u003Cdiv class=\u0022HpsHansard\u0022\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000024\u0022\u003E\u003Cspan class=\u0022HpsProceedingHeading\u0022 id=\u0022b8c2b02ac6414713be9690129d6ffa36\u0022\u003EQuestions for Oral Answer\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000025\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022f9b36200510745f089c575689d910e5e\u0022\u003EQuestions to Ministers\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000026\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022dea32ccbc1b74df9be75cf282792b3dd\u0022\u003EElection Advertising\u2014Commencement Date of Legislation\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000027\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022d48244fc-ceef-4ef5-9cee-851e4d439468\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00222a1f7e9c7c854bcea28c6fc52936e971\u0022\u003E1. Dr DON BRASH (Leader of the Opposition)\u003C/span\u003E to the Minister of Finance: When will the Appropriation (Parliamentary Expenditure Validation) Bill passed by the House last week come into force?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022 data-id=\u00223dadd72521e641949285259d88fb0d1c\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000028\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00223dadd72521e641949285259d88fb0d1c\u0022\u003EHon Dr MICHAEL CULLEN (Minister of Finance):\u003C/span\u003E I am advised that it will very likely come into force tomorrow.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000029\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022d48244fc-ceef-4ef5-9cee-851e4d439468\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00229cbe82e88d1b4205b3e5faa7ce7f8f56\u0022\u003EDr Don Brash\u003C/span\u003E: How will the public know whether political parties are honouring their commitments to pay back the amounts that were validated last week, given that the legislation makes no provision for that information to be published; or is it the case that the Government intends the public should never know whether those promises are actually being kept?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000030\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00227527fdd70b754d47974c58714f14447d\u0022\u003EHon Dr MICHAEL CULLEN\u003C/span\u003E: I do not know whether the member has kept his promise, in that respect. I know he has not paid back the GST on their broadcasting, because he stated so, publicly; and as to the other matters\u2014[Interruption] Oh, pay back the GST and the fine as well, eh? Why not pay the fine back, as well?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000031\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f44431ef-b505-4e94-9f57-a60b0a569bf7\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00229642c4c516e6479e889104488561be35\u0022\u003EShane Jones\u003C/span\u003E: What are the ramifications of the bill for Parliamentary Service expenditure on items other than advertising?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000032\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00226010f6e0fde64fbf97e7d120bf1c1790\u0022\u003EHon Dr MICHAEL CULLEN\u003C/span\u003E: I am sure Dr Brash will be glad to know that once the bill does come into force it will clarify the situation around the leaders\u2019 fund expenditure on staff employed to assist in election campaigns.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000033\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022d48244fc-ceef-4ef5-9cee-851e4d439468\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ff90801bba24440f9905fc5bbcf478cb\u0022\u003EDr Don Brash\u003C/span\u003E: Can the Minister confirm that he was advised by Treasury that the validating legislation is to be passed as part of the normal Budget legislative cycle; if so, why did he completely ignore that advice and ram validating legislation through the House under urgency?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000034\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00224d72e7b02e5a4235801463c688df432f\u0022\u003EHon Dr MICHAEL CULLEN\u003C/span\u003E: The member should not get Bryan Sinclair to write his questions. Treasury advised me of a range of options. We took one of those options.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000035\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022d48244fc-ceef-4ef5-9cee-851e4d439468\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022471cb5d387c24b71a7c2744e3f51be66\u0022\u003EDr Don Brash\u003C/span\u003E: Why was the Minister so concerned to pass validating legislation under urgency, even though Treasury made no such specific recommendation, when he shows so little concern about the fact that New Zealand First, which props up his Government, has refused to make any commitment to pay back any of the $160,000 it owes?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000036\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00224fde3531ffa1477781f9032b09cd75f8\u0022\u003EHon Dr MICHAEL CULLEN\u003C/span\u003E: I am not responsible for New Zealand First\u2019s decision, or indeed that of any political party in that respect.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000037\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00223d49aeac-8adf-497b-9400-ab7bb077bb8d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00221377a23b63b3427c83e2078ae5d77f1d\u0022\u003ERt Hon Winston Peters\u003C/span\u003E: Has the Minister received any reports into Television New Zealand, a State-owned enterprise, not taking action against the National Party for failing to meet its GST bill, and is that part of the validation legislation as well?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000038\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b9daa37496694fa38c9bd4435604ecbc\u0022\u003EHon Dr MICHAEL CULLEN\u003C/span\u003E: I have not received any advice on that matter. Clearly it is a matter for Television New Zealand. No doubt if shareholding Ministers even asked about that question, they would be accused of vindictive behaviour, by the National Party.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000039\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022d48244fc-ceef-4ef5-9cee-851e4d439468\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022de1273856a25400098a412dd1621a24a\u0022\u003EDr Don Brash\u003C/span\u003E: Does he accept that members of the public are entitled to know which parties are honouring their commitments to pay back the money they took; if so, why does his legislation make absolutely no provision for accountability and transparency in his mad dash to legalise the unlawful behaviour by him and his colleagues?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000040\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00225c8a0370cd8d4ca496da04b25fa89286\u0022\u003EHon Dr MICHAEL CULLEN\u003C/span\u003E: Apart from the fact that that gentleman has on occasion sought leave to pass validating legislation for his own overexpenditure that does not provide for the payment of the fine and the entering of the conviction that might otherwise occur, I remind him that there are parliamentary procedures and other statutory procedures under which he might try to seek the information.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000041\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00224f5ddbdf85b94ac79247a63bfb2deeaa\u0022\u003EHon Member\u003C/span\u003E: Answer the question!\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000042\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002239f31407294c40838e439b1fcdf42e16\u0022\u003EHon Dr MICHAEL CULLEN\u003C/span\u003E: I just did.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000043\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bc1e9f65-e08b-4939-867c-22ef093e2a4e\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022340e979cfe4944a9acfad3250fb1b160\u0022\u003ERodney Hide\u003C/span\u003E: Just to make matters quite clear, I seek the leave of Parliament to table the receipt from the Parliamentary Service that I received, and the entire ACT caucus received, showing that we have paid our money back, despite what is being claimed publicly by National.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000044\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bc1e9f65-e08b-4939-867c-22ef093e2a4e\u0022\u003EDocument, by leave, laid on the Table of the House.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000045\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u00221186fcbbbf05443f9eb8b908b02fa5b1\u0022\u003ESocial Inclusion\u2014Minister\u2019s Statement\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000046\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f8b92f47-d078-4e6a-b4c6-136913bda55d\u0022\u003E2. \u003Cspan class=\u0022HpsBy\u0022 id=\u00229d28b2b24b874b53a58c6019ec08071e\u0022\u003ESUE BRADFORD (Green)\u003C/span\u003E to the Minister for Social Development and Employment: Does he stand by his statement that \u201CThe Labour-led Government stands for social inclusion. We stand for policies that are supportive, not punitive \u2026 We believe in everyone having a \u2018fair go\u2019\u2014that\u2019s the New Zealand way.\u201D?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022330c030b-99be-4461-8aaa-9a10ee5bd889\u0022 data-id=\u0022e4f5ef053db147a39a668dda0180b49d\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000047\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022330c030b-99be-4461-8aaa-9a10ee5bd889\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022e4f5ef053db147a39a668dda0180b49d\u0022\u003EHon DAVID BENSON-POPE (Minister for Social Development and Employment):\u003C/span\u003E Yes.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000048\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f8b92f47-d078-4e6a-b4c6-136913bda55d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00228c43ff634d864c5982233820c0e3be21\u0022\u003ESue Bradford\u003C/span\u003E: Is the Minister confident that a \u201Cfair go\u201D was given to a woman with two children under 3 living in a Housing New Zealand house with holes under the floor, whose power had been disconnected because she could not pay the bills, and who was told that she was ineligible for a grant for firewood because her children were not yet sick?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000049\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022330c030b-99be-4461-8aaa-9a10ee5bd889\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00226340056e46484463ab0f9dca2c91bf76\u0022\u003EHon DAVID BENSON-POPE\u003C/span\u003E: I have not had that case drawn to my attention. If the member would like to pass me the details I would be delighted to have it investigated.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000050\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226f6e1ae1-8aa5-4f71-8e73-30bb378026c4\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022efb0797b4f2347c2b791b5f507498e47\u0022\u003EGeorgina Beyer\u003C/span\u003E: What steps has the Government taken to make New Zealand a more socially inclusive country?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000051\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022330c030b-99be-4461-8aaa-9a10ee5bd889\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022dfcc46d0a591443eacf21cec6a93900d\u0022\u003EHon DAVID BENSON-POPE\u003C/span\u003E: The Government has taken many steps to make New Zealand a more socially inclusive country, including the Working for Families tax relief; increases in family support for those on benefits; increases in minimum wage rates; the roll-out of the primary health organisations; 20 hours of free early childhood education for 3 and 4-year-olds; Modern Apprenticeships; improved case management support for sole parents receiving benefits; the introduction, of course, of income-related rents; lower medical fees; the reduction in unemployment; the abolition of interest on student loans; and, among other things, increases in New Zealand superannuation. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000052\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c2dfe169-d946-4f87-8d43-0bcdb7d8bebc\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00226c746c13cc6d4edca34728424776383d\u0022\u003ETariana Turia\u003C/span\u003E: What explanation can the Minister give to the 230,000 New Zealanders who are being excluded from the Working for Families in-work payment and who remain in poverty, as identified by the Child Poverty Action Group and other leading social commentators?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000053\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022330c030b-99be-4461-8aaa-9a10ee5bd889\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00224e25f703f6094d92bd7bfbc03255ce69\u0022\u003EHon DAVID BENSON-POPE\u003C/span\u003E: As the member will be aware, those figures pre-date the introduction of the Working for Families package. She will also be aware that beneficiary families have already received an increase in assistance from that package on an average of $32 per week in the first year. They will get a further increase of $10 per week, per child, in April 2007.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000054\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f8b92f47-d078-4e6a-b4c6-136913bda55d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00225808ba05408f4beaad6aab193b94833a\u0022\u003ESue Bradford\u003C/span\u003E: Is the Government giving a \u201Cfair go\u201D to those people in Tai R\u0101whiti who go off the unemployment benefit to do weather dependent field and pack-house work, and then, if it rains and they cannot work, have to go through a stand-down period before their benefits resume; if so, does he agree that such punitive treatment disincentivises those trying to get work in the first place and also flies in the face of Government reassurances that people doing seasonal work will not be subject to stand-downs?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000055\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022330c030b-99be-4461-8aaa-9a10ee5bd889\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022aea4dcdc423849f1901ba5e103bbf5f4\u0022\u003EHon DAVID BENSON-POPE\u003C/span\u003E: In respect of one of the elements of that question, the Hon David Cunliffe and I will be making some announcements in the next couple of days. I tell the member that, clearly, individual cases that she is concerned about I will be happy to investigate if she passes me that information, but that the policies of this Government make no apology for incentivising work.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000056\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c2dfe169-d946-4f87-8d43-0bcdb7d8bebc\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022e049f70859c04043b3d57a1a6ae655c5\u0022\u003ETariana Turia\u003C/span\u003E: How can social inclusion be maintained for 1,675 New Zealand workers and their families who stand to lose their jobs while the Government, the major shareholder in Air New Zealand, is outsourcing its work to China and Fiji to get cheap labour?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000057\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022330c030b-99be-4461-8aaa-9a10ee5bd889\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00224e9a998356e0456aa608d61ab37edf3f\u0022\u003EHon DAVID BENSON-POPE\u003C/span\u003E: I have no responsibility for Air New Zealand.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000058\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f8b92f47-d078-4e6a-b4c6-136913bda55d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022a0bc18a480df4facb0a39691bfb47001\u0022\u003ESue Bradford\u003C/span\u003E: Does the Minister agree that due to the loss of discretion to grant the special benefit, many people around New Zealand are suffering extreme hardship and that food banks in some parts of the country are almost empty; when will this Government do something to address the impact of the abolition of the special benefit, other than just talking about Working for Families, a programme that fails to assist those New Zealanders in the worst poverty?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000059\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022330c030b-99be-4461-8aaa-9a10ee5bd889\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00224a7b3c9c2594434890f939f7cbee58f4\u0022\u003EHon DAVID BENSON-POPE\u003C/span\u003E: No, I do not agree. I tell the member that when I last had the beneficiary advocates in my office, I invited them to come to me with any particular concerns they had about the change from the special benefit to temporary additional support, and they are yet to do so.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000060\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f8b92f47-d078-4e6a-b4c6-136913bda55d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00221c857cf62be94b27831c439757e8314b\u0022\u003ESue Bradford\u003C/span\u003E: Does the Minister think that cases like the ones I talked about earlier reveal fundamentally inadequate provisions of welfare by this Government, at least in some parts of the country, or that they are demonstrations of systemic failure within his ministry to deliver the proper entitlements to those in need; whichever it is, what action will he take to make sure that the one in five kids growing up in poverty in this country get the fair go he claims he is committed to?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000061\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022330c030b-99be-4461-8aaa-9a10ee5bd889\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00221a8ed6fdf59a4e3a8c74e72458f8f869\u0022\u003EHon DAVID BENSON-POPE\u003C/span\u003E: No, no, and if the member gives me details, I will be happy to investigate particular cases, as I have twice said.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000062\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022d4fbf1d09dc544d1bee8b6cf9ab0563e\u0022\u003ETaxation\u2014Thresholds\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000063\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E3. \u003Cspan class=\u0022HpsBy\u0022 id=\u002214dd302dc7e84b028be6acb5b9d8c0eb\u0022\u003EJOHN KEY (National\u2014Helensville)\u003C/span\u003E to the Minister of Finance: Does he stand by his statement that personal income tax thresholds \u201Cwill be considered in the light of final decisions around the business taxation review in the context of next year\u2019s Budget, for implementation on 1 April 2008.\u201D; if so, does this mean that any changes his Government intends making to personal taxes would take effect from 1 April 2008?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022 data-id=\u00227bfc5d68f0224caf8ec3f5f483e31ef0\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000064\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00227bfc5d68f0224caf8ec3f5f483e31ef0\u0022\u003EHon Dr MICHAEL CULLEN (Minister of Finance):\u003C/span\u003E Yes; yes, if such decisions are made.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000065\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022736a65c304784751837b19f487fc2898\u0022\u003EJohn Key\u003C/span\u003E: Does the Minister consider that, when the Minister of Revenue last week said in his newsletter that business tax changes will go ahead from April 2008 and will be accompanied by personal tax adjustments, that was an accurate statement, just as Mr Peters\u2019 statement a few seconds ago \u201CThey\u2019re on their way.\u201D was accurate?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000066\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b2cea7d4017d41eab89eda6763e7283a\u0022\u003EHon Dr MICHAEL CULLEN\u003C/span\u003E: I am sure that represents the very deep intentions of the Minister of Revenue, and, of course, we are from the Government, we are here to help.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000067\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022263be082-dd01-4ef1-9c19-d546d0174793\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022aa987e91178b41f1b24e352435d3ab69\u0022\u003EHon Mark Gosche\u003C/span\u003E: Are fiscal constraints the only matters considered when assessing the appropriateness of changes to the personal tax regime?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000068\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ebe645bd34ec40c384b3d7df650b0b1a\u0022\u003EHon Dr MICHAEL CULLEN\u003C/span\u003E: No. There are two other important factors. One is trade-offs in other areas of Government spending, particularly over the long term, as well as in the short term. But there is also the macroeconomic environment; with the current account deficit approaching 10 percent of GDP, the Government has to be careful how much fiscal stimulus it puts into the economy, and Dr Brash clearly agrees.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000069\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002253ada34716fd43f48f11da12a8d77499\u0022\u003EJohn Key\u003C/span\u003E: If, as a result of the business tax review, the Minister ends up cutting the company rate to 30 percent, leaving a 9c differential between the top rate and the company rate, widening out from 6c, does he consider that to be an issue; in which case, will he be doing anything about the top personal rate?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000070\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002203f0503823664276b800de71b739346c\u0022\u003EHon Dr MICHAEL CULLEN\u003C/span\u003E: The member will have to wait and see, but I would not raise the mortgage yet.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000071\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00223d49aeac-8adf-497b-9400-ab7bb077bb8d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022e9ae81823234486e966f5e53ec1ec2ba\u0022\u003ERt Hon Winston Peters\u003C/span\u003E: Has the Minister received any reports as to whether Mr Key, the National Party\u2019s finance spokesman, is right when he says that the surplus is $11.5 billion\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000072\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002251dfea20-2244-4fc7-bd7d-ebf7a98580e1\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002243daac31e43a43cbbfe9723725d00e98\u0022\u003EHon Tau Henare\u003C/span\u003E: Stick to foreign affairs!\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000073\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00223d49aeac-8adf-497b-9400-ab7bb077bb8d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002267abf911dc3340a7bed9f22ee314d517\u0022\u003ERt Hon Winston Peters\u003C/span\u003E: Tau is growing through his head again. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000074\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022022cfe6b-bae4-4028-b68a-ccffb4269442\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00222d0f1cded75f42f5b0eae2da57f2deb4\u0022\u003EMadam SPEAKER\u003C/span\u003E: Please continue.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000075\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00223d49aeac-8adf-497b-9400-ab7bb077bb8d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00222b7b629ec6e04fb4bd8cfff3243d7b9b\u0022\u003ERt Hon Winston Peters\u003C/span\u003E: I would love to, Madam Speaker. Second, what reports has he seen on the kind of financial mind that argues that the surplus for taxation is $11.5 billion when, in fact, every other informed commentator knows that it is $3 billion?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000076\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00222044864e78a4400892d505f1a5007484\u0022\u003EHon Dr MICHAEL CULLEN\u003C/span\u003E: Indeed, the operating surplus in the full level was $11.5 billion. Of that\u2014[Interruption] I will wait. I have plenty of time. I have years to answer this. Of that, $1.8 billion was merely an accounting change, but Mr Key had spent it the following morning, and $3 billion was the transfers to the superannuation fund, and the earnings on the superannuation fund\u2014all of which were set aside for a specific purpose. A large amount of the rest represented the profits on the other Government investment funds. That is why Mr Key in the morning promised tax cuts of $11.5 billion and, in the afternoon of the same day, promised tax cuts of $2.5 billion.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000077\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022263be082-dd01-4ef1-9c19-d546d0174793\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002292887f8ec8d14e6686c9e1a9b9b93809\u0022\u003EHon Mark Gosche\u003C/span\u003E: What are the implications for monetary policy of running a loose fiscal policy?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000078\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022af0976241e8e46b9b780c9cbba40d3fe\u0022\u003EHon Dr MICHAEL CULLEN\u003C/span\u003E: In just the last few days we have seen the implications of running poor fiscal policy with Italy seeing a credit-rating downgrade by both Standard and Poor\u2019s and Fitch Ratings. It is important that fiscal policy supports monetary policy. I am sure that Dr Brash could organise a seminar for Mr Key on these matters.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000079\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002271f5bb1ac6804d57869152ad7b06a3b5\u0022\u003EJohn Key\u003C/span\u003E: Can we now assume\u2014given that the leaders of the two main support parties of the Government are now saying there will be tax cuts in 2008, and his own Prime Minister is running around the country telling any group that will listen there will be tax cuts in 2008\u2014that the issue has long since passed being one of affordability and now is a question of political expediency, and that is why people are having to wait until 2008, in the very same way that Mike Williams, the Labour Party President, argued on Agenda on Saturday morning that the validating legislation went through under urgency only as a matter of political expediency?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000080\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022d95347f296444d869d63aee3bed808ac\u0022\u003EHon Dr MICHAEL CULLEN\u003C/span\u003E: We will run it through again for the member. If the member really believes that, with a current account deficit of nearly 10 percent of GDP, the Government right now should be putting in an extra $2.5 billion of spending power with no corresponding cut in Government spending, it shows how stupid a background in money manipulation of financial market speculation is in running a small economy.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000081\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00226ed4e27729f84dbeb7ea5aacd28a6505\u0022\u003EJohn Key\u003C/span\u003E: Has the Government been considering raising the trust rate to 36 percent, a rate that Mr Dunne as Minister of Revenue has been indicating may be the case, in which case can he tell us when it is likely that the trust rate will be increased?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000082\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b8b0740ecc8f40f3822798015ef94b28\u0022\u003EHon Dr MICHAEL CULLEN\u003C/span\u003E: There is no active consideration of that. The Inland Revenue Department did suggest it, I think, in its briefing papers, or something similar to that.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000083\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00229c4bc5c4199845f39fd64d2f59579d0b\u0022\u003EJohn Key\u003C/span\u003E: In the Minister\u2019s forthcoming speech to the Labour Party conference this weekend, will he be explaining why, after 7 years of healthy and, particularly lately, bumper surpluses, after 7 years of fiscal drag, and after 7 years of seeing tax increase as a proportion of national income, he has finally come to the realisation that tax cuts might make sense; can he also understand why the workers in his audience listening to his speech on Saturday or Sunday\u2014whenever he delivers it\u2014who look across the Tasman will feel a 7-year itch when they see an Australian Labor Party that is arguing for tax cuts and has been doing so for quite some time?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000084\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00228e14993816884cf8a807686263b4f47d\u0022\u003EHon Dr MICHAEL CULLEN\u003C/span\u003E: When it comes to 7-year itches, the Labour Party members know a working-class scab when they see one.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000085\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022daebd9a92e614cd1a54086d2914f64ad\u0022\u003EStudent Loans\u2014Borrowing Trends\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000086\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002270dd644d-8bcf-40dc-998a-887d62d24a76\u0022\u003E4. \u003Cspan class=\u0022HpsBy\u0022 id=\u0022a42fa6cfd4554efbb76d99c8b66374be\u0022\u003EMOANA MACKEY (Labour)\u003C/span\u003E to the Minister for Tertiary Education: What reports, if any, has he received on trends in student loan borrowing over the past year?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022 data-id=\u00225c881652ed694476a30816d9aa9d70c9\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000087\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00225c881652ed694476a30816d9aa9d70c9\u0022\u003EHon Dr MICHAEL CULLEN (Minister for Tertiary Education):\u003C/span\u003E The annual report shows that student loan borrowing has tended to reduce over the past 4 years. The average time to repay a student loan has dropped from around 10 years 4 years ago to around 9 years today, and that trend has continued over the last year.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000088\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002270dd644d-8bcf-40dc-998a-887d62d24a76\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022dfa61482ee96498fa7c1ec60248d396b\u0022\u003EMoana Mackey\u003C/span\u003E: What reports has he seen on the effects of policy changes on student loan borrowing?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000089\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022de6a729e17be444c9bf575227b083382\u0022\u003EHon Dr MICHAEL CULLEN\u003C/span\u003E: I have seen a number of reports suggesting that borrowing will skyrocket and blow out following the introduction of interest-free loans. They were from Mr Key and from Mr English. In fact, the predictions of the outstanding loan balance for 2009-10\u2014in some 3 years\u2019 time\u2014that were made this June were only 1 percent higher than those made in June last year, before the announcement of the interest-free student loan policy. The increase in cost is about 10 percent of the estimates made by National Party supporters before the last election.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000090\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00225969e5b7b1144a9d9f60f8ac685bae7d\u0022\u003EHon Bill English\u003C/span\u003E: Can the Minister explain the forecast on page 41 of the annual report that shows that borrowings will go up\u2014in the officials\u2019 forecast\u2014by at least 16 percent?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000091\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227f8c14fb-b919-46ef-866b-8db68cfa4cf0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00223773fbe5889440a09e80a514d1b72afc\u0022\u003EHon Dr MICHAEL CULLEN\u003C/span\u003E: There has been some increase in borrowings, and that is related in part to student numbers. If the member cares to look at it, he will find that the increase is a tiny fraction of that forecast by himself and National Party supporters outside the House before the last election, with figures of up to $1 billion being used at that time.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000092\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022cec8182a56e74fa0832c0cd9d603775b\u0022\u003EIngram Report\u2014Immigration, Minister\u2019s Statement\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000093\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022ac169d29-4849-42c2-a4a7-f344fd416503\u0022\u003E5. \u003Cspan class=\u0022HpsBy\u0022 id=\u0022a41c3a7aecc44fa4881463d83790ee18\u0022\u003EDr the Hon LOCKWOOD SMITH (National\u2014Rodney)\u003C/span\u003E to the Minister of Immigration: Is it appropriate for any ministerial special directions to be issued in response to immigration submissions by Taito Phillip Field, since he told the House on 19 October 2006 that Mr Field\u2019s failure to advise the Associate Minister of Immigration of all relevant information was an error of judgment?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022 data-id=\u00226c01f3464e184a9ca58a213a73b36518\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000094\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00226c01f3464e184a9ca58a213a73b36518\u0022\u003EHon DAVID CUNLIFFE (Minister of Immigration):\u003C/span\u003E Decisions are made on the basis of the best available information at the time. The Minister of Immigration and his Associate Minister rely upon evidence provided by the Department of Labour; information put forward by individuals, advocates, immigration advisers, and members of Parliament; and verification processes.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000095\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022ac169d29-4849-42c2-a4a7-f344fd416503\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ad8a0a68badd4050835c13a6303d5873\u0022\u003EDr the Hon Lockwood Smith\u003C/span\u003E: When he told the House last Thursday that Taito Phillip Field\u2019s failure to advise the Associate Minister of Immigration of all relevant information was Mr Field\u2019s only error of judgment, does that mean he is now claiming that it was not an error of judgment for Mr Field to make a deal with Mr Sunan Siriwan for him to work on Mr Field\u2019s house in Samoa without pay in return for a work permit for New Zealand; if it was not an error of judgment, how would he describe it?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000096\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022259e86b0254c4302b492b8cfc74fd130\u0022\u003EHon DAVID CUNLIFFE\u003C/span\u003E: Last Thursday I answered questions in response to a previous statement to the House on 24 August, and it is in the context of that reply that my reply was given.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000097\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022ac169d29-4849-42c2-a4a7-f344fd416503\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ee5909c85d964b719074648b9d2b290c\u0022\u003EDr the Hon Lockwood Smith\u003C/span\u003E: When he told the House last Thursday that Mr Field\u2019s failure to advise the Associate Minister of Immigration of all relevant information was Mr Field\u2019s only error of judgment, does that mean he is now claiming that it was not an error of judgment for Mr Field to employ Mr Siriwan\u2019s partner, Ms Phanngarm, as Mr Field\u2019s wife\u2019s personal housekeeper in Samoa, where she worked without pay \u201Clike slave\u201D, in exchange for a New Zealand work permit; if so, how would he now describe that behaviour?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000098\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002245b7c4a23f1c479e9700794a3bc05768\u0022\u003EHon DAVID CUNLIFFE\u003C/span\u003E: I made no comment on the matter to which the member now refers. My earlier answer referred to the Ingram inquiry\u2019s report findings.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000099\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022ac169d29-4849-42c2-a4a7-f344fd416503\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022f49197429aa34feebb8d9fdf8b850ef6\u0022\u003EDr the Hon Lockwood Smith\u003C/span\u003E: When he told the House last Thursday that Taito Phillip Field\u2019s failure to advise the Associate Minister of Immigration of all relevant information was Mr Field\u2019s only error of judgment, does that mean he is now claiming that it was not an error of judgment for Mr Field to tell Mr Siriwan not to submit his application for the 2-year work permit that the Associate Minister of Immigration had authorised, because Taito Phillip Field \u201Cgot a problem in New Zealand\u201D; if so, how would he now describe that action?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000100\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022af87e898611b4b85ad060a5b43ba39a5\u0022\u003EHon DAVID CUNLIFFE\u003C/span\u003E: As I told the House last Thursday, that matter is the subject of a conflict of evidence, and the allegation has been referred to the New Zealand Police.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000101\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022ac169d29-4849-42c2-a4a7-f344fd416503\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022126123ce327045fe90e06ed7db07235b\u0022\u003EDr the Hon Lockwood Smith\u003C/span\u003E: When he told the House last Thursday that Taito Phillip Field\u2019s failure to advise the Associate Minister of Immigration of all relevant information was Mr Field\u2019s only error of judgment, does that mean he is now claiming that it was not an error of judgment for Mr Field\u2019s family to tell people that Mr Siriwan had moved back to Bangkok when they knew he was still in Samoa and were throwing mail addressed to Mr Siriwan in the rubbish; if that was not an error of judgment, how would he describe those actions?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000102\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022aa18186d1b454567bfe6479d718fcf78\u0022\u003EHon DAVID CUNLIFFE\u003C/span\u003E: The Minister of Immigration and his Associate Minister have the right to expect full information to be provided by any member of Parliament making representations on behalf of any constituent.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000103\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022ac169d29-4849-42c2-a4a7-f344fd416503\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022c06d57a1822a4d5cab309e55faaee07a\u0022\u003EDr the Hon Lockwood Smith\u003C/span\u003E: When he told the House last Thursday that Taito Phillip Field\u2019s failure to advise the Associate Minister of Immigration of all relevant information was Mr Field\u2019s only error of judgment, does that mean he is now claiming that paying Mr Siriwan over $500 in cash, then seeking to influence what Mr Siriwan might tell the police, was not an error of judgment; if so, how would he describe it?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000104\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002238fc8a8429f240feb5909a70bced50b2\u0022\u003EHon DAVID CUNLIFFE\u003C/span\u003E: I repeat again, I think for the fifth time, that the matter to which the member refers is the subject of a conflict of evidence, and that that evidence and the allegation have been transferred to the New Zealand Police. Proof by repeated assertion is no more than innuendo.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000105\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u002229de37073f6d4af4afc6cfe39f53473f\u0022\u003ESchools\u2014New Zealand Teachers Council\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000106\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003E6. \u003Cspan class=\u0022HpsBy\u0022 id=\u0022aee64d3c29594dcbbeaf8f3ca01e9e5b\u0022\u003EHon BILL ENGLISH (National\u2014Clutha-Southland)\u003C/span\u003E to the Minister of Education: Which schools employed those teachers whose cases were published in the Herald on Sunday article on 22 October 2006, drawn from New Zealand Teachers Council decisions?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022605133aa-6c88-4150-82dd-7d9fcf1824b4\u0022 data-id=\u00228fddf003702047f5b9b2659109537a57\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000107\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022605133aa-6c88-4150-82dd-7d9fcf1824b4\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00228fddf003702047f5b9b2659109537a57\u0022\u003EHon STEVE MAHAREY (Minister of Education):\u003C/span\u003E Full information about the 13 cases reported in the Herald on Sunday is available on the Teachers Council website, along with a summary of council decisions. The Privacy Act 1993 prevents me from making available details that would identify the particular individuals concerned. However, I met with the Teachers Council this morning and I have been assured that the council closely monitors the terms of any conditions attached to an individual allowed to remain registered as a teacher. It is not legally possible for the Minister to overturn decisions made by the council; nor is it possible for the Minister to direct actions of the council in relation to a particular individual. However, for these particular cases the chairperson of the Teachers Council has undertaken to review the files and reassure me that, in all cases, conditions put in place have been followed to the letter. In addition, I have invited the chairperson of the council to provide me with any recommendations on any further improvements that can be made to current arrangements as soon as possible.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000108\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022a60aa0f6ed0c46f8b2596fcc54d883c3\u0022\u003EHon Bill English\u003C/span\u003E: Does the Minister believe that parents should know whether their child is in the care of a teacher who abused his 15-year-old niece for 2 years, or a teacher who played strip poker with female students and let them drink alcohol on a ski trip, or a teacher who imported Ecstasy?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000109\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022605133aa-6c88-4150-82dd-7d9fcf1824b4\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00222aa6e81da0b44e67bdbeb1a01d43a5d4\u0022\u003EHon STEVE MAHAREY\u003C/span\u003E: As the member knows, I am deeply concerned by these reports and I met with the Teachers Council this morning. I hope that parents will understand that the Teachers Council itself is at pains to point out that as a professional body there is no way that it would return anyone to the classroom who should not be there; it monitors closely any decisions that it makes; and, as a professional body, its members are the people to oversee this practice. As a Minister I am not able to interfere with those decisions and they cannot, of course, be changed by the council once made. But parents should take reassurance from the fact that the chairperson of the council has today, yet again, reiterated the robustness of the current arrangements. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000110\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221583b5cb-f4e0-4981-97ba-193c338ff404\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022e10fef423eb143d2b2d730c482f5386b\u0022\u003EHon Marian Hobbs\u003C/span\u003E: What is the history of the process for teacher registration?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000111\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022605133aa-6c88-4150-82dd-7d9fcf1824b4\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022e02fcb2d918a4f5885b0f45847b73745\u0022\u003EHon STEVE MAHAREY\u003C/span\u003E: Under the National Government in the 1990s the registration of teachers was voluntary until 1997. Although registration became mandatory in 1997, there was no professional body for teachers and no requirement for police vetting of teachers before they were employed in schools. When Labour took office in 1999 we immediately began to work on establishing professional standards for all teachers. Changes to the Education Act in 2001 required police vetting for all personnel in schools and early childhood centres. The Act also established the Teachers Council, which is the professional body of teachers. The body includes professional teachers, principals, leading educational professionals, and, of course, parents. It includes two independent disciplinary bodies: a complaints committee, and a disciplinary tribunal with powers either to deregister teachers or impose conditions on their ongoing registration. In 2004 new rules came into effect enabling the council to consider complaints of serious misconduct at any time rather than waiting until the expiry of the current registration. I believe that the arrangements now in place can give us confidence in the professionalism of the Teachers Council.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000112\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221a59d3ae-788b-4b19-b7dd-7d0e29a626fc\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002298ac72499dcc4d8ab3f4716c201b961d\u0022\u003EHon Brian Donnelly\u003C/span\u003E: Will the Minister assure the House that the report he claims he is to receive from the Teachers Council into its decisions and monitoring surrounding these cases will be made publicly available in order to allow the public to decide whether it can have confidence in the teaching profession\u2019s watchdog; if not, why not?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000113\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022605133aa-6c88-4150-82dd-7d9fcf1824b4\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002260eda06470df4918b04279e7cf933276\u0022\u003EHon STEVE MAHAREY\u003C/span\u003E: The report I received was, of course, the verbal report of the Teachers Council and its chief executive. As I have said, I have invited them to consider whether any further improvements can be made to what, as I have outlined, are now quite robust arrangements. If they do that, I am more than happy to make them available.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000114\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00228efffb498c724d2cb4b1e61d4fa4c05c\u0022\u003EHon Bill English\u003C/span\u003E: Does the Minister take his role as an advocate for parents seriously and if so, does he believe that it is acceptable to parents that their children may be in the care\u2014without them knowing\u2014of a teacher who has been found to have abused his 15-year-old niece, another teacher who played strip poker with female students on a ski trip, another one who imported Ecstasy, another one who was caught beating his wife and was convicted for it, and others with violent and drink-driving convictions?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000115\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022605133aa-6c88-4150-82dd-7d9fcf1824b4\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022c060cd22a7214a6aa717f8d18ae16faf\u0022\u003EHon STEVE MAHAREY\u003C/span\u003E: Yes to the first question, and of course, not to the second. That is why the Labour Government in 1999 changed the impossibly loose approach that was taken by Mr English\u2019s Government in the 1990s when basically anybody could have been in the classroom at any time. I have said today that the improvements over the last 7 years have left us in a position where the Teachers Council is able to give us reassurance that it is a professional body overseeing a proper and robust process. I have also said that I have invited that council to report to me as quickly as it possibly can on any further improvements I can take, because, of course\u2014 I say to Mr English\u2014it is offensive to suggest anything else. I take it absolutely as my role to ensure that young people are in a safe environment when they learn, as do the Teachers Council, the Post Primary Teachers Association, the New Zealand Educational Institute, and Secondary Tertiary Alignment Resource.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000116\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022282369723dd74731a405dba0b5fff9ea\u0022\u003EHon Bill English\u003C/span\u003E: Why does the Minister not follow the suggestion made by Mr Brian Donnelly and make public a report from the Teachers Council on these cases so that those of us who have children in classrooms with these teachers can make a judgment on the professional standards, rather than leaving it to the Minister and his union mates to decide in the Beehive?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000117\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022605133aa-6c88-4150-82dd-7d9fcf1824b4\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b199c6028a2f4483b443a970a5316512\u0022\u003EHon STEVE MAHAREY\u003C/span\u003E: I welcome the member\u2019s concern. I understand that he is a parent and has children in class at the present time and therefore, like all parents, he will want to be reassured in this matter. As I said to Mr Donnelly in answer to his question, when the Teachers Council prepares its report with recommendations of where we might or might not go further in this matter, I am more than happy to make that available. But right now I say to that member that, unlike the time when he was in Government, we have moved hugely in the last 6 years to ensure that we have a proper environment where registered teachers are properly registered. He might like to contemplate why he did not do that himself for the children of the 1990s.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000118\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b1f3fbaed8544ec88963c58f3404f699\u0022\u003EHon Bill English\u003C/span\u003E: Does the Minister believe that the behaviour that has been now outlined publicly and set out in detail on the Teachers Council website reflects the professional standards of the vast majority of teachers; and if he does not believe it reflects those professional standards, what does he intend to do about raising the standard of Teachers Council decisions?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000119\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022605133aa-6c88-4150-82dd-7d9fcf1824b4\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b6c1db5c18a3480892c827df4c119a42\u0022\u003EHon STEVE MAHAREY\u003C/span\u003E: Of course, this does not reflect on the 80,000 teachers who are currently in our workforce from early childhood centres through to secondary schools. As to what we are doing about raising performance, as I said, the member might like to contemplate the vacant space that existed in the 1990s under his Government and compare it with what we are doing today, which is lifting the professional standards by the invention of a Teachers Council that is writing professional standards and overseeing the development of a professional body. This is unlike himself, when he left children in the classroom in the 1990s without these protections. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000120\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b52bee03a86445de8d0fd89afc49a94a\u0022\u003EHon Trevor Mallard\u003C/span\u003E: Can I ask the Minister whether at the same time as the protections were removed for children in the early 1990s, they were put in place for animals; vets were registered while teachers were deregistered?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000121\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022605133aa-6c88-4150-82dd-7d9fcf1824b4\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022975dd2818c6c46bb9f33624adcc09acd\u0022\u003EHon STEVE MAHAREY\u003C/span\u003E: Further to the inquiry about the history of this matter, it was one of the major points made by many people in the 1990s that the National Government protected animals but did not protect children. The Labour Government protects children.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000122\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00225b9fff9351d449758712f193f1f10a79\u0022\u003EHon Bill English\u003C/span\u003E: Is the Minister going to continue to protect teachers who have abused students in their care, who have imported drugs, and who have drink-driving convictions, or is he going to expose these people to the principals who employ them and the parents whose children are in their classrooms; which is it?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000123\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022605133aa-6c88-4150-82dd-7d9fcf1824b4\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00227692c57cba114689998bed69e0eb2abc\u0022\u003EHon STEVE MAHAREY\u003C/span\u003E: Once again, a good question from someone who is a parent as well as a politician in the House. As he knows, under the Privacy Act, I personally cannot reveal the individual circumstances behind each of the cases that are on the website. However, as I explained to the member earlier\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000124\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002251dfea20-2244-4fc7-bd7d-ebf7a98580e1\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022f4c1597f6c104920984105436d5be42b\u0022\u003EHon Tau Henare\u003C/span\u003E: Come on, out with it\u2014which one of your mates are you protecting?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000125\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022605133aa-6c88-4150-82dd-7d9fcf1824b4\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022e2e164932bf84fae8254a4ea6af0cd17\u0022\u003EHon STEVE MAHAREY\u003C/span\u003E: \u2014if the member at the back would just like to listen\u2014one of the things that the Teachers Council does is to attach conditions to each of these decisions, which require the reporting back of principals about those conditions. My understanding is that that is exactly what goes on.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000126\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022022cfe6b-bae4-4028-b68a-ccffb4269442\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022cbdb9efdb8c24e5d970b262b6a80ed65\u0022\u003EMadam SPEAKER\u003C/span\u003E: If I could just remind members, when they are asking and answering questions, that they keep them succinct and also that they avoid making any unnecessary comment in them.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000127\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022fa6d21cdeb144fc68ba9e742bb67b9b1\u0022\u003ESmall Business\u2014Small to Medium Sized Enterprises\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000128\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002270fa4cbd-9380-4916-9f2a-78da059d220e\u0022\u003E7. \u003Cspan class=\u0022HpsBy\u0022 id=\u0022d3103d6d58db4a19a450b4daab155279\u0022\u003EH V ROSS ROBERTSON (Labour\u2014Manukau East)\u003C/span\u003E to the Minister for Small Business: What is the Government doing to help small to medium sized enterprises in New Zealand?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022c186d0a2-99f4-408b-9b4d-d484cf19724d\u0022 data-id=\u00228d9aba451b1d41d0ab24ae38955271cd\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000129\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c186d0a2-99f4-408b-9b4d-d484cf19724d\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00228d9aba451b1d41d0ab24ae38955271cd\u0022\u003EHon LIANNE DALZIEL (Minister for Small Business):\u003C/span\u003E Today I am releasing the Government\u2019s response to the second report of the Small Business Advisory Group. The response shows that the advisory group and the Government share a vision on how to improve the business environment for small to medium sized businesses. The Quality Regulation Review, which I announced in May this year, will also produce results around several of the recommendations, including improving the quality of regulatory impact statements. The Government is also committed to a 2-year trial of the business cost calculator, which will identify explicitly the administrative costs of proposed regulation and any alternatives.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000130\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002270fa4cbd-9380-4916-9f2a-78da059d220e\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022a429cde6de6f427a972c97e37d3bd905\u0022\u003EH V Ross Robertson\u003C/span\u003E: What other aspects of the Small Business Advisory Group report has the Government responded to favourably?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000131\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c186d0a2-99f4-408b-9b4d-d484cf19724d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b9b88a404968403587fb471e7e71aecc\u0022\u003EHon LIANNE DALZIEL\u003C/span\u003E: Ten of the 12 recommendations have received a positive response from the Government, although with both exceptions the Government is looking at whether there are other ways of reducing compliance costs, such as the addition of an online holiday calculator to the Department of Labour website. The Accident Compensation Corporation and the Inland Revenue Department have already announced changes in the way they deal with minor misdemeanours and unintentional mistakes. Improved processes for hazardous substances and new organisms controls came into operation in July this year.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000132\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002219767ece-60f1-4014-9855-74afaa34e699\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022bc44f7cd711a41acbfd960e8d19e652c\u0022\u003EDr Pita Sharples\u003C/span\u003E: T\u0113n\u0101 koe, Madam Speaker, t\u0113n\u0101 t\u0101tou katoa. Has the Minister had reports on the potential for the creation and support of businesses in the East Coast area\u2014that is, the area from Kaiti in the south to Potaka in the north; if not, why not?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000133\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c186d0a2-99f4-408b-9b4d-d484cf19724d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ad9981db0a9c4816817aee8ad89078dc\u0022\u003EHon LIANNE DALZIEL\u003C/span\u003E: Unfortunately, that was not included as one of the recommendations from the Small Business Advisory Group, although I will say to the member that one of the issues it did raise was the question of champions within individual Government departments. Te Puni K\u014Dkiri and the Ministry of Pacific Island Affairs were two departments where the group was concerned that there was proper information being given on the development and promotion of small business.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000134\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022f13bc92fa7064b4c8a23a50a4a8e847d\u0022\u003ELaboratory Tests\u2014Charges\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000135\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022a83ea07a-806c-45ad-95bb-eb2c481cd0e2\u0022\u003E8. \u003Cspan class=\u0022HpsBy\u0022 id=\u00228fdda786692043a2a643e5c9b90a8680\u0022\u003EHon TONY RYALL (National\u2014Bay of Plenty)\u003C/span\u003E to the Minister of Health: What reports has he received, if any, on possible impacts on patients of planned charging for laboratory tests originating from private specialists in the Wellington region, and does the Government support this charging?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00229c0eba1d-17a6-44e2-a9b3-2e2535339570\u0022 data-id=\u0022efcdd91245b24fc1a0855eb4cc945726\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000136\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00229c0eba1d-17a6-44e2-a9b3-2e2535339570\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022efcdd91245b24fc1a0855eb4cc945726\u0022\u003EHon PETE HODGSON (Minister of Health):\u003C/span\u003E I have seen reports that the Wellington region district health boards feel that making this change is correcting a historical anomaly that was diverting resources from patients who rely solely on the public health system. From the Government\u2019s perspective, I have told district health board chief executives that we must have national consistency on this policy to ensure fairness from region to region.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000137\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022a83ea07a-806c-45ad-95bb-eb2c481cd0e2\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022fc3218794fae466a86fbe442f9f2c233\u0022\u003EHon Tony Ryall\u003C/span\u003E: So is the Minister saying that it is the Government\u2019s intention that charging patients for tests ordered by private specialists will be implemented by all district health boards; if so, when does he expect this to be implemented by?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000138\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00229c0eba1d-17a6-44e2-a9b3-2e2535339570\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00222b3d509a277240499c6d562af4a528b6\u0022\u003EHon PETE HODGSON\u003C/span\u003E: Needless to say, the Wellington changes will occur first, and there will be some learning by doing, no doubt. District health board chief executives are next due to discuss this issue at their November meeting.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000139\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022a83ea07a-806c-45ad-95bb-eb2c481cd0e2\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022fa94d4e4301b4bdebb07eea774b4cfba\u0022\u003EHon Tony Ryall\u003C/span\u003E: I raise a point of order, Madam Speaker. My question was quite clear. I asked whether it was the Minister\u2019s intention that all district health boards will charge, and I think it is important that he answers that specific question.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000140\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022022cfe6b-bae4-4028-b68a-ccffb4269442\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002209f5f06363f54778b2cf9a0356cb15e8\u0022\u003EMadam SPEAKER\u003C/span\u003E: As the member knows, there is no requirement for a yes or no answer. However, the Minister did address the question; I listened very carefully to it.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000141\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227df975cd-93d2-4f55-9bc5-d2790e28e043\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002253d421189b0546eb9f259ed51662c45c\u0022\u003EMaryan Street\u003C/span\u003E: What is the likely annual savings resulting from various laboratory changes made in the Wellington region?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000142\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00229c0eba1d-17a6-44e2-a9b3-2e2535339570\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002223a40cecaf2d42d7a84a2127f816d655\u0022\u003EHon PETE HODGSON\u003C/span\u003E: The total annual savings is in the order of $6 million to $7 million per annum, part of which is due to the planned changes to laboratory tests originating in the private sector. All of that money is now available to be reinvested back into the health of local people within the Wellington region.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000143\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220daaf9fb-1a1f-4d31-848a-fd13cb1a2c5a\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022924f0c47490249bc98cf0de29a549f2d\u0022\u003EBarbara Stewart\u003C/span\u003E: Does the Minister share the concerns of the New Zealand Medical Association chairman, Ross Boswell, that the imposition of charges could result in people choosing to get their tests done by their already overburdened general practitioners, possibly resulting in compromised care; if not, why not?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000144\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00229c0eba1d-17a6-44e2-a9b3-2e2535339570\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022cfce27b55a574f988caa38cff0959ae6\u0022\u003EHon PETE HODGSON\u003C/span\u003E: I have met with Dr Boswell on a number of occasions on this matter and other matters, and, yes, he raised a valid point of view. It is almost certainly overstated when one considers, for example, that CAT scans, X-rays, and ultrasounds are already funded privately. All of those things cost a good deal less, on average, than do laboratory services.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000145\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022a83ea07a-806c-45ad-95bb-eb2c481cd0e2\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00226fbe1f2ff6c642af9eed41cb378ab8be\u0022\u003EHon Tony Ryall\u003C/span\u003E: What would the Minister say to an uninsured woman who has a lump in her breast, for which she is prepared to pay, say, $500 to see a specialist in order to find out whether she has cancer, when that woman will now face paying over $250 extra for laboratory tests in order to find out whether she has cancer?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000146\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00229c0eba1d-17a6-44e2-a9b3-2e2535339570\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022fbe1bf42470149d3ba85c404335d5b18\u0022\u003EHon PETE HODGSON\u003C/span\u003E: I just point out to the member that the average cost of laboratory tests is well less than that\u2014usually well under $50 for a range of tests, but some tests cost more than $200. But I would point out to the woman that if she persists with the private sector and needs a mastectomy, the cost to her will be probably $13,000. That gives members some perspective.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000147\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f99bcf9e-1ad4-4ed4-9a97-1cccb5b1e11a\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b5f69930f49743c78e373ec7a653f8a2\u0022\u003EDr Jackie Blue\u003C/span\u003E: What would the Minister say to a man with suspected prostate cancer\u2014a cancer that is mostly treated in private hospitals and that is predicted to steadily increase in the next 5 years\u2014when he is told that he will be facing additional costs well over $500; and how does the Minister think that that might affect public urology waiting lists?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000148\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00229c0eba1d-17a6-44e2-a9b3-2e2535339570\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022374e72ed9357458ca5396fef76f1326c\u0022\u003EHon PETE HODGSON\u003C/span\u003E: The cost of prostatic cancer testing is a mere fraction of that which the member would have this House believe.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000149\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f99bcf9e-1ad4-4ed4-9a97-1cccb5b1e11a\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022be86e4641a2a43869700ab5488cef62c\u0022\u003EDr Jackie Blue\u003C/span\u003E: What will the Minister say to a person who needs a cardiac bypass and is considering going private, thereby reducing the burden on the public sector waiting list, but is informed that he or she will have to pay thousands of dollars extra; and does the Minister think that this might be a tipping point for that person to decide to go public instead?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000150\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00229c0eba1d-17a6-44e2-a9b3-2e2535339570\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00224010670f21b9497283a0a2a12462b35f\u0022\u003EHon PETE HODGSON\u003C/span\u003E: I would point out that various tests that people face, whether they are receiving cardiac surgery in the private sector or any other surgery\u2014including those that I listed for the member from New Zealand First\u2014are already paid for privately, and already cost a great deal more. This change\u2014which was examined carefully by Bill English when he was Minister of Health, and he was not in the job long enough to go through with it; and it was examined on 1 July by Wyatt Creech when he was Minister of Health, and he was not in the job long enough to go ahead with it, either\u2014simply removes a historic anomaly.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000151\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022a83ea07a-806c-45ad-95bb-eb2c481cd0e2\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b07b3a79a5c64ab0a70ed75304f50615\u0022\u003EHon Tony Ryall\u003C/span\u003E: If it is a historic anomaly that private patients pay for some tests, and because the public pays for diagnostic tests they should pay for that as well, is the Minister also saying it is an anomaly that private patients should receive subsidy for their pharmaceuticals, as well?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000152\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00229c0eba1d-17a6-44e2-a9b3-2e2535339570\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00225ddcab50b41a4021b7bec29130251749\u0022\u003EHon PETE HODGSON\u003C/span\u003E: Strictly speaking one could argue that, but, of course, the Government has no intention of making treatment\u2014[Interruption] The National Party might, because it has exorbitant tax cuts on its mind; it will have to do something in order to save the money. This Government invests in health, and it draws a distinction quite clearly between testing and treatment.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000153\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022a83ea07a-806c-45ad-95bb-eb2c481cd0e2\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002213c1b5fd503244bc91197ac1e1d1352a\u0022\u003EHon Tony Ryall\u003C/span\u003E: No.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000154\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00229c0eba1d-17a6-44e2-a9b3-2e2535339570\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00229a21b62710a74174a5b8575826de6f7c\u0022\u003EHon PETE HODGSON\u003C/span\u003E: Yes, it does.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000155\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u00227344b7016ffb43e6b5d572af9a7e9750\u0022\u003EInjury Prevention Programme\u2014Tai Chi\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000156\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00223a0e52c8-5bb1-4325-9870-21f4e3eb3702\u0022\u003E9. \u003Cspan class=\u0022HpsBy\u0022 id=\u0022b077f321718940eca85812c913e02d52\u0022\u003EMARTIN GALLAGHER (Labour\u2014Hamilton West)\u003C/span\u003E to the Minister for ACC: Has she received any reports on the effectiveness of ACC\u2019s falls-prevention programmes for older people involving tai chi?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002275a05f96-2474-4c90-a6ea-cf7b5798e03e\u0022 data-id=\u00221d57659f753f46bfa49765815b75d397\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000157\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002275a05f96-2474-4c90-a6ea-cf7b5798e03e\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00221d57659f753f46bfa49765815b75d397\u0022\u003EHon RUTH DYSON (Minister for ACC):\u003C/span\u003E Yes, I have seen an evaluation of the tai chi programmes offered by the Accident Compensation Corporation (ACC). The evaluation was done by the Auckland University of Technology and shows significant improvements in the strength and balance of participants. An evaluation of Christchurch classes shows a 63 percent reduction in falls, with 97 percent of participants having improved confidence as a result of the reduced fear of falling.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000158\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002259e9efe2-6dea-4eeb-869a-ef5b3e48a5b5\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002201edcaf884f84ce3a9f7f3ea3178035a\u0022\u003ECharles Chauvel\u003C/span\u003E: Has she received any other reports concerning proposals that would jeopardise successful injury prevention programmes?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000159\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002275a05f96-2474-4c90-a6ea-cf7b5798e03e\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ba1d2fc47dff42cb9f15f97ed39c8012\u0022\u003EHon RUTH DYSON\u003C/span\u003E: Yes, I have. I have seen reports proposing that the ACC scheme be replaced with a competitive market-based scheme. It is well accepted among injury prevention experts that successful injury prevention depends on collaboration and coordination. National\u2019s proposal to privatise the scheme would do exactly the opposite, and undo the successes this Government has achieved.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000160\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u00222d6861c62f0643d8a5861bc086274882\u0022\u003ECourt System\u2014Justice for All\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000161\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022136da8c4-afc7-483e-a39c-c66812f71774\u0022\u003E10. \u003Cspan class=\u0022HpsBy\u0022 id=\u00223c281dbc7680434b8f00b2ac319aa206\u0022\u003EKATE WILKINSON (National)\u003C/span\u003E to the Minister for Courts: Is he confident that our court system is delivering justice for all; if not, why not?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022d4506109-be18-4b9d-9a79-1e15e2e2cd41\u0022 data-id=\u00229fb40354bc454d44a49f25c1892f792b\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000162\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022d4506109-be18-4b9d-9a79-1e15e2e2cd41\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00229fb40354bc454d44a49f25c1892f792b\u0022\u003EHon CHRIS CARTER (Acting Minister for Courts):\u003C/span\u003E Yes.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000163\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022136da8c4-afc7-483e-a39c-c66812f71774\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00225b780993e6cf4c318074d094901d8645\u0022\u003EKate Wilkinson\u003C/span\u003E: How can he stand by his comments that court security is a high priority, when figures show that serious security incidents in the Family Court doubled in 2004-05; and what is he doing to resolve this issue?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000164\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022d4506109-be18-4b9d-9a79-1e15e2e2cd41\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002202e43d100e8742d49cf99f409ca222ea\u0022\u003EHon CHRIS CARTER\u003C/span\u003E: The Government takes court security very seriously. In the latter half of 2005 the number of security officers, for example, was increased from 18 to a total of 53. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000165\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022136da8c4-afc7-483e-a39c-c66812f71774\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00223c369fee1f3e4e0a9ed3dfe66a072539\u0022\u003EKate Wilkinson\u003C/span\u003E: Has the Minister seen the transcript of his answers given in evidence at the examination of the Department for Courts estimate, which includes the answer: \u201CEvery Budget we have put on extra security officers\u201438 this year. It is a high priority for us.\u201D, then the question: \u201CThirty-eight this year?\u201D, then the answer: \u201CEighteen is it? Sorry, I got the wrong figure.\u201D; and the question: So there\u2019s no increased security officers from Budget 2005?\u201D, then the answer: \u201C2006. nothing.\u201D; and how much of a high priority is \u201Cnothing\u201D?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000166\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022d4506109-be18-4b9d-9a79-1e15e2e2cd41\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00223b131b356e3e4a7e80bdc3f8dd55f67c\u0022\u003EHon CHRIS CARTER\u003C/span\u003E: To be quite honest, I heard so many figures bandied around that it was hard to know which one the member was sticking to. I can report that, according to the information I have been given today, the number of security officers has increased from 18 to 53.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000167\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00222a849ed4-a817-45a7-8b86-dbc9dd210193\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022f6107176470e4f239b728cfc01946a69\u0022\u003EJill Pettis\u003C/span\u003E: How is the Pay or Stay initiative helping to deliver justice?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000168\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022d4506109-be18-4b9d-9a79-1e15e2e2cd41\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b0e92f266d0446d2a9769002371dcaf7\u0022\u003EHon CHRIS CARTER\u003C/span\u003E: The initiative to collect fines at airports has already been very effective. Six people have been intercepted at airports, and more than $37,000 netted, since the campaign began less than a month ago. All six people intercepted owed reparation to victims. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000169\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220d9640b0-d861-43d8-b321-e7ba56dbe362\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00229c4ea421723848259bdddd9739f4ec27\u0022\u003EJudy Turner\u003C/span\u003E: Is the 2-year trial of the parenting hearing programme intended to aid in breaking down the perception of anti-male bias within the Family Court; if so, what aspects of the programme does he expect to address directly the strained relationships between many fathers and court officials?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000170\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022d4506109-be18-4b9d-9a79-1e15e2e2cd41\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00224f2004d41727473caa0bf284553803ec\u0022\u003EHon CHRIS CARTER\u003C/span\u003E: The Government recognises that relationships between fathers and their children are important. As for the details that the member has raised, I will be happy to get back to her with that later, when I have more information.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000171\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022136da8c4-afc7-483e-a39c-c66812f71774\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00221fc5a073574b49f4bb1e28badda329c0\u0022\u003EKate Wilkinson\u003C/span\u003E: How can he stand by his comments that court security is a high priority, when recent changes at the Family Court mean that security will not automatically be provided, due to prioritisation in other courts, when local lawyers are warning that they \u201Chave noticed an increase in the number of abusive and emotional outbursts in court, and that often there are no police or security officers in courtrooms\u201D, and when two justices of the peace have moved to suppress their own names over fears for their safety\u2014or is this another example of this Government getting its priorities wrong?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000172\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022d4506109-be18-4b9d-9a79-1e15e2e2cd41\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b72f6d4dcf3a4e639fd9b14d6a75033c\u0022\u003EHon CHRIS CARTER\u003C/span\u003E: I have already raised the issue of the increase in the number of security guards. I can add that $156 million in baseline funding has gone into the courts since this Government came to power. And there has been a number of structural changes. For example, now single entrances are designed, with scanning machines and security officers; that was not the case under National.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000173\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022136da8c4-afc7-483e-a39c-c66812f71774\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022e2ff41f8455f47f69da92e541957eb30\u0022\u003EKate Wilkinson\u003C/span\u003E: What more will it take to highlight the need for better courtroom security\u2014another judge being punched and knocked over by an angry butcher, another judge being slashed with a machete, another judge being pelted with wads of wet toilet paper and clothing, or another judge being spat at\u2014before this Government sheds its rhetoric and really demonstrates that court security is a high priority, or are those just incidences of the ebbs and flows that the Minister for Courts was referring to in the House on 29 August?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000174\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022d4506109-be18-4b9d-9a79-1e15e2e2cd41\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022a06ae53fe6054c4ab224733ee4a798ab\u0022\u003EHon CHRIS CARTER\u003C/span\u003E: Madam Speaker, I am sure I do not need to remind you or this House that courtroom security has been an issue in New Zealand for as long as the courts have existed. Attacks on judges are not a new thing. But what this Government has done is pour $156 million into baseline funding to try to fix up the courts. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000175\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022dc0f4bec0fac4a529daecd2d438b7d31\u0022\u003EDefence Force Units\u2014Operational Level of Establishment\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000176\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002207dc4112-8a19-4dd6-a57c-878b47f8a9b6\u0022\u003E11. \u003Cspan class=\u0022HpsBy\u0022 id=\u00225b447e33095049a584979f2fcb01c2af\u0022\u003ERON MARK (NZ First)\u003C/span\u003E to the Minister of Defence: What level of establishment must Defence Force units fall below to be deemed operationally ineffective, and how many units are currently below that level of establishment?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002209a5b71a-ca7e-4e7c-9e09-f9e63f18aa12\u0022 data-id=\u0022d7bacaf4d957479ab575d50148e30ca3\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000177\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002209a5b71a-ca7e-4e7c-9e09-f9e63f18aa12\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022d7bacaf4d957479ab575d50148e30ca3\u0022\u003EHon ANNETTE KING (Minister of State Services)\u003C/span\u003E on behalf of the Minister of Defence: I am advised that all deployed units are staffed at 100 percent, fit for purpose, and equipped appropriately. I am also advised that effectiveness is not measured solely by establishment numbers. However, the Defence Capability and Resourcing Review, presented in February 2005, shows that there are a number of areas where operational and organisational capabilities are below what is required by Government policy. In answer to a written question in 2005, a summary table of the then current average strength was provided. I have asked for an update for 2006 to be provided, but it was not available in time to answer this question today. I am sure the member is also aware that these issues are being directly addressed through the Government\u2019s $4.6 billion Defence Sustainability Initiative.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000178\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002207dc4112-8a19-4dd6-a57c-878b47f8a9b6\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022762301574cbf4f79947e64073892233b\u0022\u003ERon Mark\u003C/span\u003E: How many of the units in New Zealand are currently operating under 80 percent of establishment, and can the Minister tell us the names of those units?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000179\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002209a5b71a-ca7e-4e7c-9e09-f9e63f18aa12\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00226a1581f1613e4327b7afe7d33e9e9647\u0022\u003EHon ANNETTE KING\u003C/span\u003E: No, I am unable to tell the member that today, although I did seek that information before I could answer this question. As soon as I receive it I will make it available to the member.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000180\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002207dc4112-8a19-4dd6-a57c-878b47f8a9b6\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022175425b918dd494ebd9977de2bcf9a80\u0022\u003ERon Mark\u003C/span\u003E: Can the Minister undertake to also report to the House and clarify the difference between the established strengths of the units, the authorised strengths\u2014that is, the strengths that the Government has funded those units to\u2014and the actual strengths, as we need to clearly understand the difference between those strength levels?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000181\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002209a5b71a-ca7e-4e7c-9e09-f9e63f18aa12\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002273fe43bbb8404e66b6e25ae736dd29ce\u0022\u003EHon ANNETTE KING\u003C/span\u003E: On behalf of the Minister of Defence, no I am not able to provide the answer to the member. I am told, however, that in terms of establishment it is not the only measure of effectiveness and that we need also to look at readiness, combat viability, deployability, and sustainability. But in terms of the substantial question, I could not provide the information at this time.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000182\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226c1d5df8-ac1d-4ce1-a778-202845cfc69f\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022a6b69f9da3314630b9d72d760c95f205\u0022\u003EHeather Roy\u003C/span\u003E: Does the Minister accept that full funding availability is a key element for defence units to maintain directed level of capability personnel numbers; if so, when does his Government intend to reimburse the Royal New Zealand Air Force the conservatively estimated $12 million it has cost it to date to run the air combat force disposal unit to maintain the decommissioned Skyhawk and Aermacchi fleets for a sale that looks likely never to happen?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000183\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002209a5b71a-ca7e-4e7c-9e09-f9e63f18aa12\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022f952367b1e8f4154823559b172fbdc94\u0022\u003EHon ANNETTE KING\u003C/span\u003E: This Government will stand by its commitment to the defence forces of New Zealand.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000184\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bc1e9f65-e08b-4939-867c-22ef093e2a4e\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ad95c534405149a9895da6af54e9ce3b\u0022\u003ERodney Hide\u003C/span\u003E:When?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000185\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002209a5b71a-ca7e-4e7c-9e09-f9e63f18aa12\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022a3fb5fd777474c8db2d8ce3a53cfc3d8\u0022\u003EHon ANNETTE KING\u003C/span\u003E: In fact, the first urgent injection of capital happened in 2000, with $1 billion being put in for capital equipment. Since then we have seen a commitment of $3.3 billion in terms of the long-term development plan, and a further $4.6 billion for the defence sustainability initiative, which includes provision for personnel, infrastructure, and organisation. So this Government has shown its commitment to defence in a way that no Government in the past has. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000186\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226c1d5df8-ac1d-4ce1-a778-202845cfc69f\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002201e0ba38f00e409c81424d9d32bb691e\u0022\u003EHeather Roy\u003C/span\u003E: I raise a point of order, Madam Speaker. The Minister failed to address any part of my question. The first part asked whether full funding availability was a key element for defence units to maintain directed level of capability status, and the second part asked when the Government, if the Minister agreed with that statement, would refund the Air Force the $12 million, which is a conservative estimate. She failed to address any part of that specific question. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000187\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022022cfe6b-bae4-4028-b68a-ccffb4269442\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002292a3a43608a043eaa4576b5d7800d71e\u0022\u003EMadam SPEAKER\u003C/span\u003E: The Minister gave a long answer that addressed the question generally. Would she like to specifically address the Air Force?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000188\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002209a5b71a-ca7e-4e7c-9e09-f9e63f18aa12\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022a52e87c1becd428b9d9728b96c64ee2b\u0022\u003EHon ANNETTE KING\u003C/span\u003E: I already outlined in my answer the money going into the defence forces of New Zealand, including into the Air Force. I said that I stand by our commitment to the defence forces of over $7 billion, going forward over 10 years, which includes money for the Air Force. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000189\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226c1d5df8-ac1d-4ce1-a778-202845cfc69f\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00226990e8afa6e2443baf532da4cbf52842\u0022\u003EHeather Roy\u003C/span\u003E: I raise a point of order, Madam Speaker. With respect, the Minister still has not specifically addressed the question, which was when this Government will refund the $12 million taken from the Air Force to maintain the Skyhawk and Aermacchi fleets for a sale that is never going to happen. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000190\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022022cfe6b-bae4-4028-b68a-ccffb4269442\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022f46a9ed5eca943d79775f2e6c4e6199e\u0022\u003EMadam SPEAKER\u003C/span\u003E: I think the Minister did address the question in terms of funding available. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000191\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022653126aefed04757a535e570226d2df6\u0022\u003EGambling\u2014Problem-gambling Service Providers\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000192\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002225f8c78b-f301-4aca-a936-366f00a26bc9\u0022\u003E12. \u003Cspan class=\u0022HpsBy\u0022 id=\u0022304b1f81ca9341ec8b52a68a7f7c3be8\u0022\u003ESANDRA GOUDIE (National\u2014Coromandel)\u003C/span\u003E to the Associate Minister of Health: Is he satisfied with the Ministry of Health\u2019s contracting and monitoring of problem-gambling service providers; if not, why not?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022471dee54-f59e-4497-b3d3-c39044ce7169\u0022 data-id=\u00223246e979c8244aa898375dfbc96837de\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000193\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022471dee54-f59e-4497-b3d3-c39044ce7169\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00223246e979c8244aa898375dfbc96837de\u0022\u003EHon DAMIEN O\u0027CONNOR (Associate Minister of Health):\u003C/span\u003E Yes, I am satisfied with the strategic progress being made, but there is always room for improvement.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000194\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002225f8c78b-f301-4aca-a936-366f00a26bc9\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022d50708b473f447a5bf3ce54762d30833\u0022\u003ESandra Goudie\u003C/span\u003E: Does the Minister stand by his statement that if these people are not able to meet the targets then \u201Cwe will be requiring money back from them\u201D; if so, when does he expect this money will be repaid?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000195\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022471dee54-f59e-4497-b3d3-c39044ce7169\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022746188531b824caa97f76ec3b3aa9e04\u0022\u003EHon DAMIEN O\u0027CONNOR\u003C/span\u003E: The Ministry is in active discussion and negotiation with the twelve at-risk providers and I hope to have a report by the end of next week on that. I cannot prejudge what might be required from those providers, or from the ministry, to rectify the situation.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000196\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002225f8c78b-f301-4aca-a936-366f00a26bc9\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00223c77643fac3c428b97802d585876012d\u0022\u003ESandra Goudie\u003C/span\u003E: How long does the Minister think it is acceptable for teething problems to continue\u2014teething problems such as the Te Rapuora health services paying $86,124 for counselling six clients\u2014and is he aware that, contrary to his earlier claims, most of those providers have had contracts since July 2004?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000197\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022471dee54-f59e-4497-b3d3-c39044ce7169\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00226fb0efcba91a49f48e2b9cb145388f9b\u0022\u003EHon DAMIEN O\u0027CONNOR\u003C/span\u003E: I am informed that five of the 12 are brand-new providers. The other seven have had contracts with the ministry before. However, they have been funded for a range of services broken down into different categories, and they range from brief and early intervention, peer support, community assessment and intervention, and community follow-up. These are all necessary services to try to get to the estimated 40,000 people in this country who have problem-gambling addictions.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000198\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002225f8c78b-f301-4aca-a936-366f00a26bc9\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00225cb2e00da4414af28c40f7e2c4ce9424\u0022\u003ESandra Goudie\u003C/span\u003E: Why does the ministry continue to pay problem-gambling service providers hundreds of thousands of dollars when the Minister\u2019s officials have seen quarterly reports that show providers were falling well short of contracted levels, and would not a competent Minister expect his department to withhold money for non-performance?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000199\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022471dee54-f59e-4497-b3d3-c39044ce7169\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b567ef8b8934489b9881f3fe89f7fc42\u0022\u003EHon DAMIEN O\u0027CONNOR\u003C/span\u003E: I am asking for a review of the contracts themselves to make sure that they have realistic targets that can be achieved and that they have negotiated sensible contracts with providers, who often struggle to get people with the capability and the skills to do this very difficult job.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000200\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002225f8c78b-f301-4aca-a936-366f00a26bc9\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00224f174a7763bb4770ad4327e5d2d4fcbd\u0022\u003ESandra Goudie\u003C/span\u003E: Which are the 12 problem-gambling providers that are currently under review, and when does the Minister expect that review to be completed?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000201\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022471dee54-f59e-4497-b3d3-c39044ce7169\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00227ed9ae609e244398b8fb8eb82356e562\u0022\u003EHon DAMIEN O\u0027CONNOR\u003C/span\u003E: As I said, there are 12 of them. They are included in the list that I have provided the member, and I am hoping for a report back on them by the end of next week. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000202\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00223d49aeac-8adf-497b-9400-ab7bb077bb8d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002278f33ea1047349eea083f2743b2b7518\u0022\u003ERt Hon Winston Peters\u003C/span\u003E: Has the Minister received any reports suggesting that it is a bit rich for the National Party to raise this issue now, given its support, back in 1989, when the far right of the Labour Party brought in casinos and recent gambling outlets, all of which they were warned against; now we have 40,000 problem gamblers, and the National Party has finally woken up and is concerned?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000203\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022471dee54-f59e-4497-b3d3-c39044ce7169\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b318867fda3344b4a277b479ecfed958\u0022\u003EHon DAMIEN O\u0027CONNOR\u003C/span\u003E: I am very aware of the problem. I am also aware of the irony of the situation and understand that the member on the other side of the House is rather enthusiastically supporting a gaming industry that, for the most part, delivers entertainment, but for 40,000 New Zealanders delivers a very sad outcome. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000204\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00223d49aeac-8adf-497b-9400-ab7bb077bb8d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002234b84e67b4384d18a7f8f57da3ebeab6\u0022\u003ERt Hon Winston Peters\u003C/span\u003E: I seek leave to table the voting record of New Zealand First on this matter, which has been to consistently\u2014[Interruption]\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000205\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022022cfe6b-bae4-4028-b68a-ccffb4269442\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002289379736c8904411a506ea0c44442094\u0022\u003EMadam SPEAKER\u003C/span\u003E: This is a point of order. The members who shouted out will please leave the Chamber. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000206\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00223d49aeac-8adf-497b-9400-ab7bb077bb8d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00228f4cc08c32454da480ee1d5d5a8d890e\u0022\u003ERt Hon Winston Peters\u003C/span\u003E: It was Mr Carter and Mr Hide.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000207\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022022cfe6b-bae4-4028-b68a-ccffb4269442\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ad333f63a68646de9acb7f3e1dbb7283\u0022\u003EMadam SPEAKER\u003C/span\u003E: Would they please leave the Chamber until the end of the day. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000208\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022022cfe6b-bae4-4028-b68a-ccffb4269442\u0022\u003EHon David Carter withdrew from the Chamber.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000209\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022022cfe6b-bae4-4028-b68a-ccffb4269442\u0022\u003ERodney Hide withdrew from the Chamber.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000210\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00223d49aeac-8adf-497b-9400-ab7bb077bb8d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002241dac519f4b74c0ba9463333c66e38cc\u0022\u003ERt Hon Winston Peters\u003C/span\u003E: I seek leave to table the voting record of New Zealand First, which shows we opposed these issues when they were raised. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000211\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022022cfe6b-bae4-4028-b68a-ccffb4269442\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00227010447cc4484f7fae0abab3df1814d1\u0022\u003EMadam SPEAKER\u003C/span\u003E: Is there any objection?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000212\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e6b4dc55-3561-49a8-a871-ae005354ef90\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022298bf1de36d34f07b40598b21e0afe96\u0022\u003EGerry Brownlee\u003C/span\u003E: I raise a point of order, Madam Speaker. The member has sought leave to table the voting record of New Zealand First. That is fascinating: on what?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000213\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022022cfe6b-bae4-4028-b68a-ccffb4269442\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002279c230160dd7455fb6c92a5b1700d9d8\u0022\u003EMadam SPEAKER\u003C/span\u003E: That is not a point of order. The member clearly identified what it was on. He clearly identified, before he was rudely interrupted by members who are no longer with us, that he was referring to the voting on the introduction of casinos. Is there any objection to that? There is objection. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000214\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00224a11ce4e-9fb3-4738-b0be-5a9f81d975da\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022d5346a6eecee4c8c871e798aa79a1fde\u0022\u003EHon Maurice Williamson\u003C/span\u003E: I seek leave to table the voting record of Winston Peters during 1989 on the legislation regarding casinos. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000215\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00224a11ce4e-9fb3-4738-b0be-5a9f81d975da\u0022\u003EDocument not tabled.\u003C/span\u003E\u003C/p\u003E\n    \u003C/div\u003E\n    \u003Cdiv class=\u0022HpsHansard\u0022\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000216\u0022\u003E\u003Cspan class=\u0022HpsProceedingHeading\u0022 id=\u002260b4c7db461546c68c3106386de9ac90\u0022\u003EUrgent Debates Declined\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000217\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022f2ecb12b92b64d34834a3f28ad3fb968\u0022\u003EDioxin Release, Ivon Watkins-Dow\u2014Report\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022022cfe6b-bae4-4028-b68a-ccffb4269442\u0022 data-id=\u00228a0d500ecc464748a276bf4b1c3f16eb\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000218\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022022cfe6b-bae4-4028-b68a-ccffb4269442\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00228a0d500ecc464748a276bf4b1c3f16eb\u0022\u003EMadam SPEAKER\u003C/span\u003E: I have received a letter from Sue Kedgley seeking to debate under Standing Order 380 recent developments in the ongoing health impacts of dioxin released from the Ivon Watkins-Dow plant at Paritutu in New Plymouth. The recent developments involve the Leonard report commissioned by TV3. This does not involve ministerial responsibility. The Ministry of Health has said it will look into claims that significant mistakes were made in the study of dioxin contamination in New Plymouth. The ministry\u2019s comments relate to events that are likely to occur. There is, therefore, no particular case of recent occurrence involving administrative or ministerial responsibility of the Government that would give grounds for a debate on this matter today. The application is declined. \u003C/span\u003E\u003C/p\u003E\n    \u003C/div\u003E\n    \u003Cdiv class=\u0022HpsHansard\u0022\u003E\n      \u003Cp\u003E\u003Cspan class=\u0022HpsProceedingHeading\u0022\u003EBills\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000219\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u00229a191f071ad94a5b9de4e350d68ebb42\u0022\u003EInjury Prevention, Rehabilitation, and Compensation Amendment Bill\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000220\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u00225889fc2687e449a5a0fcaba7e012570b\u0022\u003EFirst Reading\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002275a05f96-2474-4c90-a6ea-cf7b5798e03e\u0022 data-id=\u0022d0cc7d6f22a04e9b8177aefaf7fe62c7\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000221\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002275a05f96-2474-4c90-a6ea-cf7b5798e03e\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022d0cc7d6f22a04e9b8177aefaf7fe62c7\u0022\u003EHon RUTH DYSON (Minister for ACC):\u003C/span\u003E I move, That the Injury Prevention, Rehabilitation, and Compensation Amendment Bill be now read a first time. At the appropriate time I intend to move that the bill be considered by the Transport and Industrial Relations Committee, that the committee present its final report on or before 18 December 2006, and that the committee have the authority to meet at any time while the House is sitting, excepting during questions, during any evening in a day in 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, despite Standing Orders 192 and 195(1)(b) and (c). \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000222\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002275a05f96-2474-4c90-a6ea-cf7b5798e03e\u0022\u003EThe Injury Prevention, Rehabilitation, and Compensation Act 2001 provides a fair and sustainable scheme for minimising both the overall incidence and the impact of injury in the community. A key goal of the Act is to ensure that the Accident Compensation Corporation (ACC) scheme is funded in a fair and sustainable manner. The bill continues to progress this goal through merging the accident compensation self-employed work account and the employers\u2019 account into a single work account, so that levies are more stable and provide a better reflection of risk. Currently levy payers and their injury claims are allocated to either the self-employed work account or the employer\u2019s account on the basis of their business structure, which is derived from tax information. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000223\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002275a05f96-2474-4c90-a6ea-cf7b5798e03e\u0022\u003EThe self-employed work account was established as an ACC-run default account to support the creation of the private insurance market for employer and self-employed workplace injury cover in 1999. When workplace injury cover was returned to the Government-run accident compensation scheme, the self-employed work account was retained as a separate account on the basis that the self-employed had a higher rate of serious injury than employees. Further consideration indicates that a higher average rate of serious injury for the self-employed is mainly due to the clustering of self-employed people in high-risk industries and occupations, such as forestry, fisheries, and farming. Business structure\u2014in this case, self-employment\u2014is not considered a significant risk factor. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000224\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022fae7af0d-c48d-4dd4-88f3-928ccaa3a984\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00228eb64f8156d54877ae250d29b6bbfad5\u0022\u003EThe ASSISTANT SPEAKER (Ann Hartley)\u003C/span\u003E: I am sorry to interrupt the member, but I have given members leeway. They know they are not to stand and have meetings while a member is speaking. Please leave the Chamber immediately and quietly.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000225\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002275a05f96-2474-4c90-a6ea-cf7b5798e03e\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022cac54bcdcf364c02834275ac1e9af1ee\u0022\u003EHon RUTH DYSON\u003C/span\u003E: The self-employed work account has also had a high degree of volatility, due to its small earning space combined with a high turnover of levy payers from year to year. Small businesses particularly have cited levy instability as creating problems for their business cost planning. The merger will ensure that accident compensation levies paid by businesses are fairer, as they will be based on the injury risk associated with the activity undertaken, rather than on the basis of the business structure. It will ensure that the levies are more stable for both the self-employed and employers. It will also improve the focus of reducing the risk of injury by encouraging industries to better coordinate health and safety across their workplaces, regardless of business structure. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000226\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002275a05f96-2474-4c90-a6ea-cf7b5798e03e\u0022\u003EThe existing funds and claims currently allocated to the employers\u2019 account and self-employed work account will be transferred to the new work account. The work account will continue to fund the entitlements that are provided for under the Act at present. Programmes allowing for levy adjustments based on safety management practices and the ability of the self-employed and shareholder employees to purchase an agreed amount of weekly compensation cover will also be retained under the work account. Employers, private domestic workers, and self-employed people will pay levies into the work account to fund the cost currently provided for under that account. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000227\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002275a05f96-2474-4c90-a6ea-cf7b5798e03e\u0022\u003ETo ensure that the transition to a single work account is as fair and smooth as possible, the bill provides for a transition period of 3 years for the self-employed and employer levy rates in each industry or risk class to equalise. During this period levy rights would be only able to increase or decrease by up to 25 percent in relation to the previous year\u2019s levy rates. After the transition period is complete employers and self-employed people in the same industry or risk class would pay the same levy rate. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000228\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002275a05f96-2474-4c90-a6ea-cf7b5798e03e\u0022\u003EThe bill also renames the medical misadventure account the treatment injury account. The Injury Prevention, Rehabilitation, and Compensation Amendment Act (No 2) 2005 replaced the \u201Cmedical error\u201D and \u201Cmedical mishap\u201D definitions with a \u201Ctreatment injury\u201D definition and removed the necessity to find fault in order to obtain cover for treatment injuries. Those new provisions were implemented on 1 June 2005. At the time of the amendment the name of the account to which such claims are allocated\u2014the medical misadventure account\u2014was retained for purposes of continuity. As health professionals and health-professional organisations are now familiar with the new systems, terms, and cover provisions that have been implemented, it is appropriate that the medical misadventure account be renamed the treatment injury account. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000229\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002275a05f96-2474-4c90-a6ea-cf7b5798e03e\u0022\u003EOur Government is committed to providing strong public services. Creating a fair and simple accident compensation scheme that reduces the incidence and impact of personal injury is our goal. This bill builds on the framework provided by the existing legislation by ensuring that the accident compensation scheme is funded in a fair and sustainable manner. I commend the bill to the House. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000230\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002275a05f96-2474-4c90-a6ea-cf7b5798e03e\u0022\u003EDebate interrupted.\u003C/span\u003E\u003C/p\u003E\n    \u003C/div\u003E\n    \u003Cdiv class=\u0022HpsHansard\u0022\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000231\u0022\u003E\u003Cspan class=\u0022HpsProceedingHeading\u0022 id=\u0022f6cf61c5e08f4d799cdcb98eb7bf9dbc\u0022\u003EAmended Answers to Oral Questions\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000232\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022780803415ed7498c9cc7093f81664f4b\u0022\u003EQuestion No. 10 to Minister\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022d4506109-be18-4b9d-9a79-1e15e2e2cd41\u0022 data-id=\u0022f6cf4323712243c698ae118517497ac9\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000233\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022d4506109-be18-4b9d-9a79-1e15e2e2cd41\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022f6cf4323712243c698ae118517497ac9\u0022\u003EHon CHRIS CARTER (Acting Minister for Courts):\u003C/span\u003E I seek leave from the House to correct some information I gave in answering question No. 10 today.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000234\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022fae7af0d-c48d-4dd4-88f3-928ccaa3a984\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00229708e1de506f42be8c84d9bef5c15190\u0022\u003EThe ASSISTANT SPEAKER (Ann Hartley)\u003C/span\u003E: Leave is sought for that. Is there any objection? There is not.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000235\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022d4506109-be18-4b9d-9a79-1e15e2e2cd41\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00229f8e7f44a406453cadab993eb5dcda5f\u0022\u003EHon CHRIS CARTER\u003C/span\u003E: In replying to a supplementary question today on question No. 10, I mentioned the increase in security guard numbers in courts around New Zealand, and said they had gone up from 18 to 53 in total. I should have said that the number had gone up from 35 to 53, an increase of 18.\u003C/span\u003E\u003C/p\u003E\n    \u003C/div\u003E\n    \u003Cdiv class=\u0022HpsHansard\u0022\u003E\n      \u003Cp\u003E\u003Cspan class=\u0022HpsProceedingHeading\u0022\u003EBills\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000236\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022d57b034ce1204b2aa1a286b16bb2e6b7\u0022\u003EInjury Prevention, Rehabilitation, and Compensation Amendment Bill\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000237\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u0022e148737998914490bd80c89928a739be\u0022\u003EFirst Reading\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000238\u0022\u003EDebate resumed.\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022cfdabe42-521a-4dca-afab-3e781731a130\u0022 data-id=\u0022e5cf04237f024dc9b36366b6909473b3\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000239\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cfdabe42-521a-4dca-afab-3e781731a130\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022e5cf04237f024dc9b36366b6909473b3\u0022\u003EDr PAUL HUTCHISON (National\u2014Port Waikato):\u003C/span\u003E Thank you for the opportunity to speak on the Injury Prevention, Rehabilitation, and Compensation Amendment Bill. The National Party is opposing this bill, as it will make accident compensation less efficient, it will place a greater burden on the taxpayer, and it has been brought in in a deceptive and somewhat devious way. This bill represents Minister Dyson\u2019s and the socialist Labour Government\u2019s absolute ideological bent to stick with the Accident Compensation Corporation (ACC) monopoly at all costs, even though it will make accident compensation less efficient, even though it sends signals against, not for, workplace safety, even though it undermines the very successful accredited employers\u2019 ACC Partnership Programme, and even though it makes it less likely that the accident compensation scheme will be fully funded by 2014, which is required in the legislation. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000240\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cfdabe42-521a-4dca-afab-3e781731a130\u0022\u003EI look at the explanatory note of the bill with wonder, because it states: \u201CThis Bill continues the Government\u2019s commitment to a fair and sustainable ACC scheme, by merging the Employers\u2019 Account and the Self-Employed Work Account\u201D. All one has to do is to look at the transitional provisions, and one will see that the Minister\u2019s claim to fairness goes right out the door. It states that to achieve the merger by 1 April \u201Cthe Bill provides for the usual consultation process on the 2007-08 regulations to be bypassed, as there is insufficient time to consult\u201D. Ruth Dyson has the temerity to tell this House that she has a commitment to fairness, yet with this bill she legislates to bypass due process and consultation. That is classic, arrogant behaviour of the Labour Government, which now, after 7 years, actually goes to the lengths of legislating to signal that it is not listening. In fact, it legislates to say it is not prepared to listen. That is how far the Labour Government goes. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000241\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cfdabe42-521a-4dca-afab-3e781731a130\u0022\u003EThe other aspect Labour claims is that the scheme is sustainable. What does Mr Phil O\u2019Reilly of Business New Zealand say about the merger? He says that not only will merging the two accounts mean that employers are subsidising accident compensation for the self-employed, but also that without experience rating, which rewards a good safety record and penalises a poor one, there are not strong incentives for companies to constantly improve their safety management. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000242\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cfdabe42-521a-4dca-afab-3e781731a130\u0022\u003ELet us just look at the ACC annual report and its claims under Labour. We see that steadily, over the last 7 years, accident claims have been going up\u2014year after year, despite this Labour Government claiming its monopoly model is so good. Severe and moderate injuries have also been going up, despite this Labour Government saying that it is putting more money into prevention. I do not know what the Minister is wittering away about there, but the fact is that if one looks in the annual report, one sees that claims are continuing to go up, despite what this Government suggested would happen. In 1999, when accident compensation was put out to competition and choice, claims went down. For the first time in many years the whole organisation became much, much more efficient. Case management became incredibly efficient, with early rehabilitation and people getting back to work much faster. The facts are there. It is a great worry that the Minister denies the facts. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000243\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cfdabe42-521a-4dca-afab-3e781731a130\u0022\u003EBut let me look at the other things the Minister says in the explanatory note of the bill. It states: \u201CWhen workplace injury cover was returned to the ACC, the SEWA was retained as a separate Account from the Employers\u2019 Account on the premise that self-employed people have a higher rate of serious injuries than employees.\u201D That is absolutely correct. The explanatory note then states: \u201CFurther evidence now indicates that the higher average injury rate for self-employed people is mainly due to the clustering of self-employed people in particular high injury risk industries and occupations (such as forestry, fisheries, and farming).\u201D That is absolute rubbish. I would like Minister Dyson and her union mates to produce the evidence to substantiate those claims. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000244\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cfdabe42-521a-4dca-afab-3e781731a130\u0022\u003EFor instance, I will look at the rate of entitlement claims per million dollars of payroll. The self-employed rate is 1.06 per million; the employers\u2019 account is half that, at 0.525 per million. The average claims cost for self-employed people is $14,200; from the employers\u2019 account it is $13,704. But what is really important is the fact that the claims per million dollars of payroll for the employers\u2019 account are less than half those of the self-employed work account. Minister Dyson has absolutely no ability to substantiate what she has put in the general policy statement of the explanatory note. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000245\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cfdabe42-521a-4dca-afab-3e781731a130\u0022\u003EThe Government then has the gall to state in the explanatory note: \u201CThe merger will ensure that ACC levies paid by businesses are fairer, as they will be based on injury risk associated with activity undertaken, rather than business structure.\u201D We agree with that. That is exactly what Business New Zealand has been saying for years and years. Risk rating actually works. But no, the Labour Government does not want to believe in simple common sense. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000246\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cfdabe42-521a-4dca-afab-3e781731a130\u0022\u003EThere is some mischief in this bill that Minister Dyson has not come clean about. Firstly, last year the Labour Government very quietly introduced an amendment to section 192(6) of the Act. It allows transfers of claims liability from the employers\u2019 account to the residual account. One of the commentators believes that the transfer of claims liability from the employers\u2019 account to the residual account under this scheme is the most significant change to the accident compensation scheme in the last 6 years. The impact of that on future levies has not been openly discussed or debated, nor have the potential ramifications been communicated to the stakeholders liable for funding that growing system. That is yet another example of the Minister failing to listen to those who are intimately involved with the scheme. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000247\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002275a05f96-2474-4c90-a6ea-cf7b5798e03e\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00229678d1c804474e7ab6780b9b890293bf\u0022\u003EHon Ruth Dyson\u003C/span\u003E: Rubbish!\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000248\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cfdabe42-521a-4dca-afab-3e781731a130\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b3e15a272e4744988080b629bb67c2fc\u0022\u003EDr PAUL HUTCHISON\u003C/span\u003E: She says \u201CRubbish!\u201D. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000249\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cfdabe42-521a-4dca-afab-3e781731a130\u0022\u003EBut what has also happened is that this is undermining the very successful accredited employers ACC Partnership Programme. That is a particularly sad thing, because under that programme there has been some very, very successful management in the private sector. For instance, one of the third-party administrators highlights how its focus on early return to work strategies has meant it has significantly outperformed ACC over many years. Its present average entitlement claim cost is $3,900 for the employers, against ACC\u2019s average cost of $13,700. Its average entitlement claim loss days is 4, compared with ACC\u2019s estimate of 35 days. That is how inefficient the ACC is. Minister Dyson hates the fact that under the ACC Partnership Programme, businesses are very effective and efficient in managing the scheme, and she want to curb it. That is of serious import. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000250\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cfdabe42-521a-4dca-afab-3e781731a130\u0022\u003EBy making these artificial changes to the employers\u2019 levy, the Government is undermining the highly efficient Accredited Employers Programme.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022263be082-dd01-4ef1-9c19-d546d0174793\u0022 data-id=\u00226e753098a58a46bc84bd88ec4881bf36\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000251\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022263be082-dd01-4ef1-9c19-d546d0174793\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00226e753098a58a46bc84bd88ec4881bf36\u0022\u003EHon MARK GOSCHE (Labour\u2014Maungakiekie):\u003C/span\u003E It is interesting to follow that member over there, who obviously had to read from either his research unit notes or the notes of whoever writes the National Party speeches on accident compensation. It is probably the exact same people who supported National\u2019s election campaign with the expectation that they would be sitting back up there in that gallery as they were when National privatised accident compensation in 1998.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000252\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c437bda8-4741-4ac5-89ab-b0818e1ab9fa\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022614b374c72734f0c977196e8b7e6e99e\u0022\u003EDarren Hughes\u003C/span\u003E: They were morticians.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000253\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022263be082-dd01-4ef1-9c19-d546d0174793\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00221ebbb29de51a473dbd92a85f11f6b8a9\u0022\u003EHon MARK GOSCHE\u003C/span\u003E: They were like a couple of morticians from HIH, and they were morticians, all right\u2014they oversaw the death of a major amount of money in Australia that the poor old taxpayers, workers, and businesses of Australia had to fork out, because of the failed privatisation model that the previous National Government tried to impose upon New Zealand, and that this Government quite rightfully chucked out. This type of small legislation that we have signalled clearly to people just makes sense. That is something one could never accuse the National Party spokesperson on accident compensation of. As the third-party people who have designed National\u2019s policy say, it is a pity Dr Hutchison, despite the best work of designing the National Party\u2019s policy for them prior to the election, is not bright enough to know what accident compensation is about.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000254\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002275a05f96-2474-4c90-a6ea-cf7b5798e03e\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002263bb85599bfe4883a207d6628427387e\u0022\u003EHon Ruth Dyson\u003C/span\u003E: That is what they are saying about him.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000255\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022263be082-dd01-4ef1-9c19-d546d0174793\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022c1344deb043f4633934757a2ffc91f26\u0022\u003EHon MARK GOSCHE\u003C/span\u003E: That is what they say about him\u2014the people who are funding the National Party\u2019s election campaigns in the expectation that they will get privatised accident compensation back\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000256\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002275a05f96-2474-4c90-a6ea-cf7b5798e03e\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00222c9af12232c042da8298b843f9dcefe0\u0022\u003EHon Ruth Dyson\u003C/span\u003E: Have we got it in writing?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000257\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022263be082-dd01-4ef1-9c19-d546d0174793\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00220ab41b895716414da1feb9bcb0323b08\u0022\u003EHon MARK GOSCHE\u003C/span\u003E: Oh yes, we have it in writing that he is a major disappointment to the industry that backs the National Party. But the industry will keep on forking the money over to the National Party because it knows there are huge profits if it gets National back in again to privatise accident compensation as it did last time. It was a disaster. One has only to look across the Tasman and check the levy rates. Of course the research unit of the National Party did not bother to do that. It tried to find some figures in the annual report, but poor old Dr Hutchison did not bother to check their work to find out that the figures he was quoting were wrong, because he was not talking about the accident rates in terms of the percentage against the size of the workforce\u2014which, by the way, under this Government continues to grow and grow every year. As we get unemployment down to the lowest in the world, obviously we get a growth in the workforce, and if there is a growth in accident rates the correct figure to look at is the percentage against that workforce growth. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000258\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022263be082-dd01-4ef1-9c19-d546d0174793\u0022\u003EPoor old Dr Hutchison did not get his research unit to point that out to him in the annual report. However, when he comes to the select committee that will deal with this bill\u2014a very good, hard-working, and sensible select committee\u2014we will give him a bit of education. There are actually some good National Party members on that committee who actually do some work from time to time and they will help to educate him.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000259\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002275a05f96-2474-4c90-a6ea-cf7b5798e03e\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022795ccfb07d1a4c40aefb2be0fdce787c\u0022\u003EHon Ruth Dyson\u003C/span\u003E: Who?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000260\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022263be082-dd01-4ef1-9c19-d546d0174793\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00222bbb27f3592a447a930402cf3b59d48a\u0022\u003EHon MARK GOSCHE\u003C/span\u003E: Like Bob Clarkson, one of the great intellects of the National Party. He is on that committee with us. He will teach Dr Hutchison about this, because Bob knows all about hard work. He does not like the work he does here; he much prefers to go home and get on the digger every weekend\u2014he said that that is real work, instead of coming down here and having to mix with the people over there. They have no intellectual grunt when it comes to understanding things like this.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000261\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022977cccaf-581d-4f48-924e-32bf6c54a93d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022439d0dea71ea49eab98dfbbc749fcd4b\u0022\u003EAnne Tolley\u003C/span\u003E: I raise a point of order, Madam Speaker. I have waited now for some 5 minutes for the speaker to actually address the bill. I ask you to bring him back to the bill before the House.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000262\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c437bda8-4741-4ac5-89ab-b0818e1ab9fa\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ac76defdf94f49e8bc9db985297e5e60\u0022\u003EDarren Hughes\u003C/span\u003E: First of all, it is impossible for Mark Gosche to have been doing that for 5 minutes, because he did not start his speech until 3 minutes ago, but, secondly, a fair amount of time is allowed for rebuttal on a first reading speech and I do not think he has done anything outside some of the outrageous claims made by the previous speaker; he is within his rights to spend part of his 10-minute call answering that.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000263\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022fae7af0d-c48d-4dd4-88f3-928ccaa3a984\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022e9b22b5b9bdc48efbb13ae4e84a6cf49\u0022\u003EThe ASSISTANT SPEAKER (Ann Hartley)\u003C/span\u003E: The member was addressing the bill generally and, as he said, the previous speaker raised a lot of general issues within the bill that the speaker was addressing.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000264\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022263be082-dd01-4ef1-9c19-d546d0174793\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00224704e4f0e4864119ac4e5152e7aac2fa\u0022\u003EHon MARK GOSCHE\u003C/span\u003E: Thank you, Madam Assistant Speaker. I was just about to ask National members whether their next speaker could explain why a plumber who is operating as a self-employed plumber should pay a different rate of accident compensation from somebody operating as, say, a sole trader who has set up a company doing exactly the same work with the same risk. National members say they are opposed to the measure. Why do they not go out there and tell small businesses why they are opposed to it? They should tell them why one plumber doing exactly the same job as another plumber, but whose business structure is X, should pay a different rate from a plumber whose business structure is Y. That is why that National Party is no longer seen as the party for business. It is because it has lost it. National members oppose simple, sensible measures such as this just for the sake of it. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000265\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022263be082-dd01-4ef1-9c19-d546d0174793\u0022\u003EIt is just not good enough. One does not oppose things just for the sake of it. They should explain to two plumbers, one of whom is operating under a company structure and one of whom is self-employed, both with the same risk, why their levies should be so different. We are waiting for National\u2019s intellectual grunt to answer that one. We will be waiting for a long time, because National members come to the House only to oppose and to dish up policy that somebody else has made up for them\u2014like the privatisation of accident compensation that Dr Wayne Mapp will talk about next. He will talk about the fact that he wants to put up the levies for all New Zealand workers in businesses, by privatising, by getting the vultures from HIH who were in the gallery, like a couple of morticians, overseeing the death of accident compensation, but I am pleased to say that accident compensation is back as a State-provided wonderful system with low levies, and HIH is dead.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022df788c48-b9be-42fd-b8f2-76629a5572b8\u0022 data-id=\u002204a095c92cdf4f4fb3abebd029e90c7d\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000266\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022df788c48-b9be-42fd-b8f2-76629a5572b8\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002204a095c92cdf4f4fb3abebd029e90c7d\u0022\u003EDr WAYNE MAPP (National\u2014North Shore):\u003C/span\u003E Well, we can certainly tell when Labour members think that not very many people are listening\u2014they get up and talk about their hatred for business; they talk about their hatred for competition; and they talk about their arrogance in just passing legislation and steamrollering it through, irrespective of the economic reality of the situation, and irrespective of whether submissions are being made on the best way forward. This Government is putting legislation into the House before it has even heard submissions from the industry on the whole issue. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000267\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022df788c48-b9be-42fd-b8f2-76629a5572b8\u0022\u003EThat is typical of this Government. It is just like last week when we had validation legislation dealt with in 24 hours, without listening to the public. Well, I have news for the Minister. The public have given their verdict and they hate this current Government. They want to see the end of it. They see this Government as an arrogant, hateful Government interested only in its continuation in power. The voters will get to make that judgment in 2 years\u2019 time, and they will not forget. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000268\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022df788c48-b9be-42fd-b8f2-76629a5572b8\u0022\u003EThis kind of legislation is exactly what we now expect from this Government. It hates competition. Mr Gosche was proud to say that Labour hated the competition of 1998 and 1999. That was the era where, for many businesses, the premium cost fell by as much as 80 percent. Why was that? It is a simple thing that Government members cannot get their heads around. It is the whole element of risk and reward, the rate of accidents and the level of premiums, and the incentives to get people back to work so that the cost of premiums can be reduced. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000269\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022df788c48-b9be-42fd-b8f2-76629a5572b8\u0022\u003EGovernment members do not understand it; they hate it. Whenever they think the public is not looking they talk in hateful ways about competition and effectiveness. They seem to think that when National members talk about the value of competition and about the value of getting private sector competition into the provision of accident compensation, we have somehow lost it. The proof of 1998 and 1999 is completely lost on this Government. We are proud to say in this House that we will reintroduce competition. The one thing this Government has never really understood is what that competition was about. We still had 7-day, 24-hour cover based on 80 percent of earnings. That never changed. The only thing that changed was the range of options that businesses could choose from to provide that cover. There was a competitive-based premium approach, based on the level of accidents. The only way the Government got through its bill, back in 1999-2000, was to get some sort of synthetic approach from the accredited employers partnership. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000270\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022df788c48-b9be-42fd-b8f2-76629a5572b8\u0022\u003EThis bill today sabotages that scheme. That is what this Minister is doing to that scheme. The one bright spot in its socialist nationalisation of the scheme in 1999 was the accredited employers partnership. The reason it worked is that there was at least some connection between risk, and cost of premiums, and self-management. That is why it was successful: there was that connection. Of course, the socialists hate that connection. They want a flat, uniform charge whenever possible. So there is a complete disconnection between the risk of accidents, and the levels of premiums They want that to be broken. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000271\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022df788c48-b9be-42fd-b8f2-76629a5572b8\u0022\u003EI have heard Labour members talk many, many times on all of these kinds of social insurance schemes. They want a total universal approach. They want a flat-fee approach. They want no connection between the level of accidents and the level of premiums for particular businesses. So they will always find devices and mechanisms that break that link, and that is because in their hearts\u2014and I include the members sitting in the Chamber today, Mr Maharey, the Hon Ruth Dyson, the Hon Judith Tizard, and even, dare I say it, Darren Hughes\u2014they are all socialists. They believe in socialisation, and whenever they think they can get away with it, that is what they will do. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000272\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022df788c48-b9be-42fd-b8f2-76629a5572b8\u0022\u003EI have news for those members\u2014the 1950s have come and gone. The 1990s have come and gone. We are looking towards a 21st century where New Zealanders expect to pay in relation to a connection between risk and what they get. People know that in the modern world, and this Government has lost this truth. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000273\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022df788c48-b9be-42fd-b8f2-76629a5572b8\u0022\u003EI want to produce some evidence for the Government. A submission was made to this Government by an organisation called Wellnz, which is a private provider associated with the accredited employers scheme. This is what it had to say. It manages 4,000 claims per year within the accredited employers scheme. It is in its interests, and in the interests of the accredited employers, to reduce its costs, because that is how it reduces its premiums. How does it reduce costs? Basically, it is by rehabilitation. There is a real incentive for people to get better, because when people get better they go back to work and fall out of the accident compensation system as they have gone back to independence. Wellnz focuses on that, and this is what it achieved\u2014I am quoting from its submission. It has an entitlement claim cost, measured over 4,000 claims, of $3,900. The Accident Compensation Corporation (ACC) average is $13,700. Another way of looking at that is to say that the ACC is four times less efficient than Wellnz at managing claims. Why is that? It is because the ACC is a bureaucracy, and bureaucracies and State socialists simply do not make the connection between the costs they incur, not for themselves, but for businesses. They think it is all just a cost-plus mentality.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000274\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022df788c48-b9be-42fd-b8f2-76629a5572b8\u0022\u003E That is the flaw in the ACC model as represented by Labour. As soon as there is any element of competition, any element of incentive, when there is a connection between the level of the premium and getting people back to work, there is a real incentive on the provider to go through the rehabilitation process and get people back to work. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000275\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022df788c48-b9be-42fd-b8f2-76629a5572b8\u0022\u003EThe other interesting statistic is that the average entitlement claim lost days is only 4 days under Wellnz; under ACC it is 35 days. That is nine times more, simply because of the dead hand of bureaucracy over employers. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000276\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022df788c48-b9be-42fd-b8f2-76629a5572b8\u0022\u003EThis bill summarises Labour\u2019s philosophy: it hates competition, it hates efficiency, it has an arrogant approach to employers and employees, and believes in dependency; that is its hallmark and it will be judged on it. On this side of the House, National believes in competition, in rehabilitation, in people getting get back to work and making a contribution. It believes in independence as opposed to dependency. That is what New Zealanders are looking for, and in 2 years\u2019 time, they will judge this Government as a failure.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022e3dc3d88-a571-4ed7-a4b4-b66dedd6134b\u0022 data-id=\u0022150e0b6157b14593b89da03f2a16d455\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000277\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e3dc3d88-a571-4ed7-a4b4-b66dedd6134b\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022150e0b6157b14593b89da03f2a16d455\u0022\u003EPETER BROWN (Deputy Leader\u2014NZ First):\u003C/span\u003E I listened to Wayne Mapp with some interest because normally he comes out with some commonsense-type statements around bills of the nature of the Injury Prevention, Rehabilitation, and Compensation Amendment Bill, but I could not hear terribly many words about this bill. I say that with some sincerity because this bill is an attempt to have the level of the premium in line with the level of risk; that is what it is all about.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000278\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e3dc3d88-a571-4ed7-a4b4-b66dedd6134b\u0022\u003EI think the honourable member should talk to some self-employed people. The Hon Mark Gosche asked why a self-employed plumber should be treated differently from a plumber who works under a company structure. I thought Wayne Mapp might answer that. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000279\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022df788c48-b9be-42fd-b8f2-76629a5572b8\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002209bc985f4dcf44d0beb87580070b3984\u0022\u003EDr Wayne Mapp\u003C/span\u003E: It all depends on the risk.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000280\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e3dc3d88-a571-4ed7-a4b4-b66dedd6134b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022a5ac13d8fc444a069f1c95177e72ab13\u0022\u003EPETER BROWN\u003C/span\u003E: It does not all depend on the risk. That plumber could change his structure overnight and pay a different premium. I have spoken to a number of self-employed people. They will tell members that the levies are all over the place, they go up and down far too frequently, and the level of compensation is most unclear and most unfair.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000281\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e3dc3d88-a571-4ed7-a4b4-b66dedd6134b\u0022\u003EI was very interested in what the Hon Mark Gosche had to say. He recognised that there was growth in the accident rate as Dr Hutchison had outlined earlier, but he implied\u2014I will not go so far as to say he stated\u2014that it was far less than the growth in employment. If employment numbers go up, it is only logical that, to some degree, accident rates will go up.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000282\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e3dc3d88-a571-4ed7-a4b4-b66dedd6134b\u0022\u003ENew Zealand First will support this bill going to a select committee. We do not confuse the current regime with the previous regime, under the privatised workplace insurance scheme that National brought in. We actually supported it and would have liked it to have a longer trial, because in the 6 months it was in existence\u2014and that was all it was in existence for\u2014it seemed to be working pretty well. We would have liked it to have at least a 2-year trial and a thorough evaluation at the end of it. But that is not what we have. We have the Accident Compensation Corporation scheme now. It has been modified, it has been amended, and it has been improved. In fairness to the Government, we have to recognise that the scheme has been improved on what it was when it came in, in 2001 or 2000. Was it 2000?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000283\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022df788c48-b9be-42fd-b8f2-76629a5572b8\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022777eee80b9db44f69d0f100ec26fcd0b\u0022\u003EDr Wayne Mapp\u003C/span\u003E: 2000.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000284\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e3dc3d88-a571-4ed7-a4b4-b66dedd6134b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00221e71759c558c416d93dc34fabcc8d05f\u0022\u003EPETER BROWN\u003C/span\u003E: It was 2000. The Government has improved it gradually, bit by bit. New Zealand First considers that this bill makes another improvement, so we will support it. It is no good harping back on the privatised scheme. When National members get their shot at the Government benches, they will have the opportunity to do what they want, but now we have the obligation to make this legislation as fair and as reasonable as possible for the people it affects\u2014not for us but for the people it affects. This legislation is a move in the right direction.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000285\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e3dc3d88-a571-4ed7-a4b4-b66dedd6134b\u0022\u003ENew Zealand First will support this bill going to a select committee, but we have one reservation. We do not think it is wise or fair to change the name medical misadventure account to treatment injury account. We will be interested in the public\u2019s view on that. It might be just a small change, but a claim for medical misadventure puts shivers down the spines of doctors\u2014and there are two doctors over there. \u201CTreatment injury account\u201D sounds nice and woolly-woolly and fuzzy-fuzzy, and we are not terribly happy about that. We are keen to hear what the public has to say on it.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000286\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e3dc3d88-a571-4ed7-a4b4-b66dedd6134b\u0022\u003ENevertheless, New Zealand First will take an objective view. We are keen to see the bill go to a select committee, and we will work through it diligently and conscientiously to ensure that we get the best legislation, not for ourselves but for the public of New Zealand, particularly the self-employed. Thank you.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022b8383f38-c78c-4e5d-8324-677d91e95c49\u0022 data-id=\u002258dd06de88f04798a387e6695fed3549\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000287\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b8383f38-c78c-4e5d-8324-677d91e95c49\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002258dd06de88f04798a387e6695fed3549\u0022\u003EKEITH LOCKE (Green):\u003C/span\u003E The Green Party will be supporting the Injury Prevention, Rehabilitation, and Compensation Amendment Bill. I would like to make a few comments on behalf of my colleague Sue Bradford, who is our spokesperson on this area. The Green Party welcomes the introduction of the bill. The new bill is short and unusually simple for anything related to accident compensation. It corrects two glaring anomalies in the current legislative framework. We are pleased to support the bill going to a select committee, and through all its stages.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000288\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b8383f38-c78c-4e5d-8324-677d91e95c49\u0022\u003EThe most significant provisions are contained in clauses 4 to 11, which have the effect of combining the employers\u2019 account and the self-employed work account into one account to be called the work account. This is an undoubtedly sensible move. The existence of these two systems side by side has created anomalies in that people carrying out what are essentially the same business activities have their accident compensation levies based not just on the injury risk of those activities but on the structure of their business. For example, there is no good reason why a self-employed builder pays an accident compensation levy different from that paid by a company established by another builder that employs him or her as its sole employee\u2014the injury risks are the same. That type of discrepancy is the sort of inequity that was inherent in the National Government\u2019s misguided workplace injury insurance privatisation experiment of the late 1990s.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000289\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b8383f38-c78c-4e5d-8324-677d91e95c49\u0022\u003EIt is unfortunate that we have had to wait 6 years to see this particular inconsistency rectified. I can certainly understand the Government\u2019s wish to address the anomaly promptly now to ensure it does not carry forward into the 2007-08 tax year. However, I question why it has taken so long to introduce this simple bill. The delay has meant that a transitional provision is now required, in clause 15, to bypass the consultation process required by section 331 of the Injury Prevention, Rehabilitation, and Compensation Act in setting the work account levies for 2007 and 2008. Appropriate decision-making involves consultation with stakeholders, and section 331 reflects recognition by Parliament of this principle. Under clause 15, no consultation with employers and self-employed people will be required in setting the 2007-08 work account levies. That is a direct and unfortunate consequence of the belated introduction of this bill. That said, the Green Party does not wish to see the anomaly continue into a further tax year, so, despite our reservations regarding the transitional provision dispensing with consultation over levy setting, we support the commencement date of 1 April 2007 proposed for this bill.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000290\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b8383f38-c78c-4e5d-8324-677d91e95c49\u0022\u003EThe second major feature of this bill is clause 12. This clause renames the medical misadventure account the treatment injury account. Medical misadventure cover was replaced by treatment injury cover under a previous amendment effective from 1 July last year. Because Sue Bradford did not sit on the select committee dealing with that bill at the time, the Greens are somewhat unsure as to why the account was not renamed then. We imagine it was a drafting error. However, better late than never, and the Green Party supports this issue being rectified, especially now that health-care providers are familiar with the new system.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000291\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b8383f38-c78c-4e5d-8324-677d91e95c49\u0022\u003EOne of the aspects of the new bill we are most pleased about is the fact that many of New Zealand\u2019s around 250,000 self-employed people should have their accident compensation costs cut as a result of the merger of the employers\u2019 account and the self-employed account. When Sue Bradford was involved in the two initial accident compensation reforms bills back in 2000, the Green Party had a strong position of seeking to make sure that the interests of the self-employed, including farmers, were represented in that legislation. In July this year self-employed people were subject to a 10 percent increase in their levies, taking them to $3.54 for the first $100 of earnings. This happened at the same time that the employers levy remained at $1.21 for each $100 of payroll. In an agricultural society, for example, livestock farm employees pay about $2.56 for each $100 of employee income, while self-employed livestock farmers pay between $3.93 and $4.66 per $100. The gap between what the self-employed pay and what employers pay has continued to widen, assisted by the fact that the pool of self-employed people is decreasing, which means their levies keep rising exponentially. This is why merging the accounts will be a big help in equalising and lowering costs for the self-employed. They will also have the option of taking out CoverPlus Extra, if they want the additional protection that that provides.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000292\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b8383f38-c78c-4e5d-8324-677d91e95c49\u0022\u003EI acknowledge that levies will go up for some\u2014for example, those working with chemical products, in aged care, or in ambulance services\u2014but I am relieved by reassurances that the number of self-employed people affected is not large, and that the Accident Compensation Corporation will smooth and cap any increases at 25 percent a year.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000293\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b8383f38-c78c-4e5d-8324-677d91e95c49\u0022\u003EThe Green Party is pleased that we are removing what has become today an anachronistic separation between the employers\u2019 account and the self-employed account, and that what appears to be a drafting error\u2014the misnaming of the medical misadventure account\u2014will be corrected. Many changes of a far more substantive nature could and should be made to the administration of the accident compensation system in this country, but meanwhile the Green Party supports the small steps forward in this bill.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022c2dfe169-d946-4f87-8d43-0bcdb7d8bebc\u0022 data-id=\u002227b7028c297d402593909a9bc83e4aed\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000294\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c2dfe169-d946-4f87-8d43-0bcdb7d8bebc\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002227b7028c297d402593909a9bc83e4aed\u0022\u003ETARIANA TURIA (Co-Leader\u2014M\u0101ori Party):\u003C/span\u003E T\u0113n\u0101 koe, Madam Assistant Speaker, t\u0113n\u0101 t\u0101tou katoa. I was pleased to see in the explanatory note of the Injury Prevention, Rehabilitation, and Compensation Amendment Bill that the Government states that it has a commitment to a fair and sustainable accident compensation system, and I commend the Minister for ACC, Ruth Dyson, for her willingness to consider strategies that work in the accident compensation system to respond to the priorities for tangata whenua. T\u0113n\u0101 koe, Ruth. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000295\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c2dfe169-d946-4f87-8d43-0bcdb7d8bebc\u0022\u003EThere are two key issues we want to raise about this bill. It is a bill to discuss the merging together of two accounts\u2014if you like, balancing the books. It is also a bill that provides an opportunity to discuss access, which, it must be said, the bill does not address well. A fair and sustainable accident compensation system must address the inequities that have been identified for so many M\u0101ori who do not access accident compensation or whose claims are denied. A fair and sustainable accident compensation system must address the lack of cultural fit. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000296\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c2dfe169-d946-4f87-8d43-0bcdb7d8bebc\u0022\u003EThe other night I was reading the classic health resource Mauri Ora: The Dynamics of M\u0101ori Health. In it, Professor Mason Durie stated his theory on cultural fit, and I quote: \u201CThe degree of comfort individuals feel with seeking health services impacts on their use of services and, in turn, health outcomes. \u2026 The delivery of care in a culturally appropriate manner is an important element in determining both the willingness of people to access services and the success of any treatment or care then delivered.\u201D \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000297\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c2dfe169-d946-4f87-8d43-0bcdb7d8bebc\u0022\u003EThe M\u0101ori Party comes to the Injury Prevention, Rehabilitation, and Compensation Amendment Bill thus thinking about these challenges. What degree of comfort do M\u0101ori have with the accident compensation system? What health outcomes do they achieve? How effective is the delivery of culturally appropriate care? And the results are not good news. Despite the fact that tangata whenua have a higher injury rate across the board, they are significantly less likely to make an accident compensation claim and they are more likely to be declined cover. In other words, application and take-up rate of accident compensation by M\u0101ori is significantly lower than it is by non-M\u0101ori. Although M\u0101ori made up 14 percent of the working age population in the 2005-06 year, M\u0101ori were 11.3 percent of new claimants and 9.8 percent of ongoing claimants, while being overrepresented in injury statistics across all age groups and in employment and in sport. What is interesting is that there is an even higher proportion of M\u0101ori claimants being declined accident compensation support. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000298\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c2dfe169-d946-4f87-8d43-0bcdb7d8bebc\u0022\u003EThis data, however, is probably still an understatement of the real situation for M\u0101ori. It is by anyone\u2019s account a depressing story. Indeed, when we look at M\u0101ori in the peak fitness age\u2014the 24 to 34-year-old age group\u2014we find that injury is the leading cause of death, accounting for 52 percent of deaths of M\u0101ori at this age. It is obvious from statistics about workplaces for M\u0101ori that they are overrepresented in high-risk industries. M\u0101ori aged 25 to 64, particularly men, are more likely to be injured at work than non-M\u0101ori, and this reflects the types of occupations in which M\u0101ori men are overrepresented, such as manual and trade occupations. But there is also the bizarre fact that M\u0101ori are under-represented in accident compensation claims and entitlements. For the 2005 calendar year the claim rate per 1,000 New Zealand Europeans was 361 per 1,000 compared with 289 M\u0101ori. It is not a trick question, but what explanation can there possibly be to respond to the fact that all the reports state that M\u0101ori have greater need, but then Accident Compensation Corporation (ACC) reports less access to treatment? \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000299\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c2dfe169-d946-4f87-8d43-0bcdb7d8bebc\u0022\u003EDr Peter Jansen\u2019s recent research on M\u0101ori consumer use and experience of accident compensation services reveals that M\u0101ori are currently not receiving entitlements to care, rehabilitation, and compensation at a level comparable to the proportion of M\u0101ori in the population. His research identifies four key barriers to care. The first is the cost of care. The cost of a general practitioner visit often discourages M\u0101ori from seeking assistance. Other perceived costs including prescriptions and travel expenses are also barriers. Many also express concern at the loss of their job, believing that the 80 percent of previous income that accident compensation covers will not be adequate to cover their household expenses. Eighty percent of an already low income just will not pay the bills. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000300\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c2dfe169-d946-4f87-8d43-0bcdb7d8bebc\u0022\u003EThe second barrier is communication, including difficulty navigating the system or perhaps a lack of awareness of accident compensation entitlements. Out of the 651 participants in the survey, only 56 percent said that the general practitioner had given them everything they needed to know about accident compensation entitlements. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000301\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c2dfe169-d946-4f87-8d43-0bcdb7d8bebc\u0022\u003EThe third barrier is structural. Structural barriers may be created by consumers living some distance from the general practitioner or by their not being able to make appointments on time. The fourth barrier is cultural fit. Dr Jansen\u2019s research reported consumer experiences where they felt there was no respect for M\u0101ori, they could not trust the general practitioner, or they perceived a level of racism. Other comments reported the discomfort that consumers felt at not being able to have their wh\u0101nau with them. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000302\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c2dfe169-d946-4f87-8d43-0bcdb7d8bebc\u0022\u003EI have taken some time to share these results with the House today because I believe that the real and significant disparities between M\u0101ori and non-M\u0101ori\u2019s accessing of accident compensation must be addressed if we are to ever achieve a fair and sustainable system. Auckland general practitioner Dr David Jansen confirms that disparities exist between M\u0101ori and non-M\u0101ori even when poverty is taken out of the equation. Fewer diagnostic tests are ordered for M\u0101ori, M\u0101ori make fewer accident compensation claims, and they die at an average of up to 10 years earlier than non-M\u0101ori. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000303\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c2dfe169-d946-4f87-8d43-0bcdb7d8bebc\u0022\u003EThe M\u0101ori Party is disappointed that this bill\u2014far from addressing these inequalities\u2014may actually, by an accident of its design, exacerbate even further the inequities experienced by M\u0101ori. For, in merging the employers\u2019 account and the self-employed work account into a single work account, the concern is that there will be disproportionate impacts on the self-employed, an increasing number of whom are M\u0101ori, as levies will almost certainly increase. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000304\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c2dfe169-d946-4f87-8d43-0bcdb7d8bebc\u0022\u003EThere will be levy rate increases for self-employed people in high-risk industries like fishing, farming, and forestry. Of course, those are three areas\u2014fishing, farming, and forestry\u2014where tangata whenua will be particularly effective. This is where our antennae really shot up. This bill will create another increased cost that the M\u0101ori fisheries industry will need to absorb, in addition to the increased wages of the workers on foreign fishing vessels\u2014an issue we have been rigorously opposing over the last month. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000305\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c2dfe169-d946-4f87-8d43-0bcdb7d8bebc\u0022\u003EWe are also aware that costs will be increased for new businesses and those who are newly self-employed, as the ACC requires the next year\u2019s levy in advance. In a practical sense, that means that 2 years\u2019 worth of payments have to paid upfront. The possible consequences of these high levies might be that self-employed small businesses are faced with difficult choices, like cutting back on health and safety equipment, thus setting them up for future accidents. Given the high propensity for M\u0101ori to be involved in both high-risk and low-paid occupations, the risk of compromises being made on occupational health and safety is just far too great. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000306\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c2dfe169-d946-4f87-8d43-0bcdb7d8bebc\u0022\u003ETo return again to the concept of accident compensation as a fair and sustainable system, I point out that an issue that sticks out is the redistribution of $96 million of levy reserves from the employers\u2019 account to the self-employed work account. Although there is a $400 million surplus in the employers\u2019 account, the self-employed work account is in deficit. Employers have thus questioned the justice in transferring the surplus for use by groups that have not contributed to it. Employers are saying it is not right that their levies have been used to prop up the self-employed without due and informed consultation with all parties. One has to ask why the Government could not come to the party and prop up the self-employed work account. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000307\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c2dfe169-d946-4f87-8d43-0bcdb7d8bebc\u0022\u003EThere needs to be more consultation and dialogue on the issue. The bill is rather evasive, suggesting that the usual consultation process on the 2007-08 regulations should be bypassed so that there will be insufficient time to consult. The M\u0101ori Party simply ask that the questions that have arisen, even in our brief analysis, warrant making time available\u2014time to consider why providers are seeming to give lesser and lower quality to indigenous people, time to consider how M\u0101ori can identify when it is appropriate to seek treatment for injury, time to consider how M\u0101ori with injury differ in expectations from other consumers, and time to consider the degree of comfort, the cultural fit, and the health outcomes, in order to ensure that future generations of M\u0101ori have an opportunity to live their full lives to their potential. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000308\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c2dfe169-d946-4f87-8d43-0bcdb7d8bebc\u0022\u003EWe will support the Injury Prevention, Rehabilitation, and Compensation Amendment Bill through to the select committee, in order to provide the time and opportunity for these questions to be heard. T\u0113n\u0101 koutou katoa.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00220d9640b0-d861-43d8-b321-e7ba56dbe362\u0022 data-id=\u0022ff91618f0ffd46268d60471861835aa1\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000309\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220d9640b0-d861-43d8-b321-e7ba56dbe362\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022ff91618f0ffd46268d60471861835aa1\u0022\u003EJUDY TURNER (Deputy Leader\u2014United Future):\u003C/span\u003E I rise on behalf of United Future to speak to the first reading of the Injury Prevention, Rehabilitation, and Compensation Amendment Bill. United Future will be supporting the bill going through to the select committee. However, we are not averse to some of the provisions that were originally in the Accident Insurance Act of 1998, which National Party members hark back to; we suspect that the opportunity to engage with the private sector was never given enough time to bed down, and that some opportunities in that area have been lost to us. But we recognise that this amendment bill is about addressing current problems with the current system. It is an opportunity to bring in some much-needed fairness, and that is what we have focused our support on. We do not think that hand-wringing and looking back will make any measurable difference to, particularly, self-employed people, who are currently faced with a lack of certainty over their accident compensation levies. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000310\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220d9640b0-d861-43d8-b321-e7ba56dbe362\u0022\u003EI want to deal firstly with a comment made by the New Zealand First speaker regarding the renaming of the medical misadventure account to the treatment injury account. We all agreed that under the old system, which was changed in a previous amendment bill\u2014and I am pretty sure New Zealand First supported the change\u2014when medical misadventure happened, a considerable amount of time had to be taken to prove it had happened, before the person who had suffered medical misadventure could get the compensation and help that he or she needed and was looking for. A person would have to prove that medical misadventure had happened. There was a complete shift in thinking around that issue, to an approach that acknowledged that a treatment injury had happened and that left the issue of blame to the professional bodies that dealt with that and got on with the job of making sure the person in need of support and compensation received them in a timely way\u2014hence the change of name from the medical misadventure account to the treatment injury account. The need to change the name of the account, as the Green member suggested, was overlooked during the passage of the previous amendment bill, and we are tidying that up right now. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000311\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220d9640b0-d861-43d8-b321-e7ba56dbe362\u0022\u003EIt is really good that we are making work-related injuries more clearly defined, and that the levies are set according to the risk posed by the activity that is intended to be undertaken, rather than according to what has proved, apparently, to be the flawed approach of thinking that self-employed workers were particularly high-risk people just by virtue of being self-employed. Evidence has now been amassed to suggest that that is not true. Although it is true that there seems to be some clustering of self-employed people around particular high-risk industries and occupations, such as forestry, fisheries, and farming, being self-employed in itself does not pose a higher risk. The Hon Mark Gosche rightly asked whether a self-employed plumber should have to pay more in accident compensation levies than a plumber who works for a company pays. Obviously, the risks in those situations are identical, and it therefore seems that that inconsistency does not make sense. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000312\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220d9640b0-d861-43d8-b321-e7ba56dbe362\u0022\u003EHowever, a M\u0101ori Party member raised a question that I also noticed, as I was scrolling through the commentary on the bill. I hope this question can be answered in the select committee process. It seems that those who currently contribute to the employers\u2019 account will now be propping up those who currently contribute to the self-employed account. I think that that situation is of concern and has a potential downside for one half of the equation. We need to look very seriously at that situation, to make sure that what we set up is truly equitable and truly fairer\u2014certainly, that is the intention of the bill, and we support that. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000313\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220d9640b0-d861-43d8-b321-e7ba56dbe362\u0022\u003EI also think that questions raised by the National Party beg an answer, and I am hopeful that the select committee process will explore those questions. I note that National members have talked about their concern that this legislation will somehow undermine prevention provisions that are currently in place. They are also concerned that its provisions will be less efficient than the current system, and they picked up on some concerns that there will be less clarity in respect of funding than the bill purports to provide. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000314\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220d9640b0-d861-43d8-b321-e7ba56dbe362\u0022\u003EUnited Future has one other concern\u2014and it is probably our No. 1 concern\u2014that we really want to hear some advice back from the select committee on, and I imagine there will be some submissions around this issue. Our concern is about the transitional provisions that are intended so that the provision can take effect from 1 April 2007. The bill provides for the usual consultation process on the 2007-08 regulations to be bypassed, because of insufficient time to consult on the regulations. We have a huge warning signal sounding that we would be bypassing a process that has always been robust and able to highlight any difficulties that may be unwittingly proposed. So we would like to hear some feedback on that particular issue. We think that measure is slightly alarming, if not very alarming, and I imagine that people who make submissions to the select committee will pick up on that issue and make some recommendations. I hope the select committee can find a way to weed-whack its way through that little problem and come up with an alternative approach, so that we can move ahead with the very noble intention of improving the current provision of accident compensation, as it exists right now\u2014not what we might want the scheme to look like, and what our policy may prefer it to look like\u2014so that it is completely fair for all those who participate in the business community and are currently very disturbed at the lack of fairness that they experience on a day-to-day basis. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000315\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220d9640b0-d861-43d8-b321-e7ba56dbe362\u0022\u003EUnited Future is happy to support the first reading of the bill.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00226c1d5df8-ac1d-4ce1-a778-202845cfc69f\u0022 data-id=\u0022e2e76846666549ac91c82df351311cac\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000316\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226c1d5df8-ac1d-4ce1-a778-202845cfc69f\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022e2e76846666549ac91c82df351311cac\u0022\u003EHEATHER ROY (Deputy Leader\u2014ACT):\u003C/span\u003E I rise to speak to the first reading of the Injury Prevention, Rehabilitation, and Compensation Amendment Bill on behalf of ACT New Zealand. We will be opposing this bill, and I will go on to explain why. The bill, as the explanatory note states, covers two issues. The first is quite large and concerns the merging of the employers\u2019 account and the self-employed work account. ACT vigorously opposes that merger. The second issue concerns the renaming of the medical misadventure account as the treatment injury account. I will address that issue first, as it is much smaller and much more technical in nature, but there is quite a principle at stake. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000317\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226c1d5df8-ac1d-4ce1-a778-202845cfc69f\u0022\u003EIn 2005 another accident compensation amendment bill was introduced in this House, and I listened to the submissions in the Health Committee. That amendment bill removed the necessity to find fault to obtain cover for treatment injuries, amongst other things, and removed \u201Cerror\u201Dand \u201Crare and severe\u201D as definitions of medical mishap. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000318\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226c1d5df8-ac1d-4ce1-a778-202845cfc69f\u0022\u003EAt that time, ACT vigorously opposed the amendment bill, pointing out many of the injustices that arise when fault does not have to be found. We will oppose that part of the current amendment bill as vigorously as we opposed the previous legislation, given that we did not agree with the principle in the first place. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000319\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226c1d5df8-ac1d-4ce1-a778-202845cfc69f\u0022\u003EWith that out of the way, we can address the primary reason for bringing this bill to the House\u2014that is, to merge the employers\u2019 account and the self-employed work account. Other members have talked about the fact that the National Party\u2019s speeches have harked back to the 1999 amendments, and, I suppose, the privatisation of the account, which allowed for competition and choice. It is not a harking back; it is in fact a relooking at very sensible changes made to accident compensation, which improved the operating of accident compensation completely. Despite those changes being in place for only 9 months, there was a decrease in the number of injuries and a decrease in the levies that employers, the self-employed, and others paid. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000320\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226c1d5df8-ac1d-4ce1-a778-202845cfc69f\u0022\u003EIt saw competition and choice introduced into the running of the accident compensation scheme, and that was a very good thing. The sooner we move back to that system, the better, despite the fact that it was tried for only a very short time. It should have been trialled for much longer; the advantages would have been much more visible, had that been the case, and it was a very backward step for this nation, indeed, that those provisions were removed. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000321\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226c1d5df8-ac1d-4ce1-a778-202845cfc69f\u0022\u003EThere are some very good things about the Accident Compensation Corporation (ACC). I recently asked a written question of the Minister about what percentage of accident compensation surgery was done in private hospitals. The answer came back that the updated figure was 83 percent. ACC has managed to get that absolutely right\u2014that is, the contracting-out of surgery to the private hospitals that are able to do that most efficiently, and, very important, as taxpayers are footing the bill, very cost-effectively. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000322\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226c1d5df8-ac1d-4ce1-a778-202845cfc69f\u0022\u003EUnfortunately, the health system generally has not learnt its lesson in that respect. Again, that is a very backward step for the taxpayers of this country. However, in this instance the policy in this bill today will not be of benefit to taxpayers, or to employers and the self-employed. Despite the speaker from New Zealand First seeming to miss this point completely, accident compensation is an insurance-based scheme, and as such is based on risk. Unfortunately, we have a monopoly insurer, and I have addressed that point already, saying we should go back to having competition and choice, which would see significant improvement in the system. Certainly, that is what the ACT party wants to happen. But one size does not fit all, and the proposal to merge the two accounts is a one-size-fits-all solution to a problem that involves insuring those in the workplace, where it should be based on risk.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000323\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226c1d5df8-ac1d-4ce1-a778-202845cfc69f\u0022\u003EWe hear much about improving workplace safety. This bill, unfortunately, will not do that. It will not see the incentivisation of safety, and that has been pointed out by groups like Business New Zealand. The first point to be made is that the employers\u2019 account is significantly overfunded, compared with the self-employed account. We need to look at these two accounts very carefully, just to see the state of them at the moment. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000324\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226c1d5df8-ac1d-4ce1-a778-202845cfc69f\u0022\u003EIf we look at some forward forecasting, the employers\u2019 account is forecast to be overfunded to the tune of about $341 million as at 30 June 2007\u2014an overfunding of around 27.2 percent. In contrast, the self-employed account, which is a much smaller account, given the nature of the employment type, is forecast to be in a deficit position to the tune of $33.5 million as at 30 June 2007. That represents an underfunding of around 11 percent. So the two accounts are in significantly different positions. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000325\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226c1d5df8-ac1d-4ce1-a778-202845cfc69f\u0022\u003EThat is important, because, as a result, we will see a significant cross-subsidisation by the employers\u2019 account of the self-employed account. Some people probably think that that has absolutely no significance at all, but it has. It means that employers will be paying a lot more than the self-employed. So they will be subsidising that group when, in fact, the risk is significantly different. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000326\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226c1d5df8-ac1d-4ce1-a778-202845cfc69f\u0022\u003EI turn to my second point. The United Future member highlighted a point, but I think came to the wrong conclusion. She used the example of a plumber, as many others have. The plumber example, I suppose, is a good one but again the wrong conclusion has been reached by just about everybody who has used it. Why should a self-employed plumber be paying a levy different from somebody who is employed as a plumber and the employer is paying the levy on that person\u2019s behalf? \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000327\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226c1d5df8-ac1d-4ce1-a778-202845cfc69f\u0022\u003EThe problem is that not all workplaces are equal, and what needs to happen is that workplaces need to be assessed. They are at the moment; they are audited for workplace safety management practices. That leads to an experience-rating, so those workplaces that have a good safety record pay less than those that do not have a good safety record. The plumber example is a good example of how this should not work. In fact, the workplaces that are safe should be rewarded for providing a safe workplace\u2014presumably they take better safety precautions, realising fewer injuries in their final outcome. That is what should be in place. So groups should receive the benefit for a good safety record, and those that do not provide one should be penalised. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000328\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226c1d5df8-ac1d-4ce1-a778-202845cfc69f\u0022\u003EACT will oppose this bill for a number of reasons. The differences between the employers\u2019 account at the moment and the self-employed work account, resulting in cross-subsidisation, is a concept we find unacceptable. The levy rates should be based on experience. The two accounts are not funded to the same tune at the moment, so that is a real difficulty for the future. The other thing we object to is that this planned legislation does not show a commitment to fairness and sustainability when it will\u2014and the transition provisions in the bill highlight this\u2014bypass the usual levy consultation process for the 2007-08 year. This, too, is totally unacceptable, particularly from a Government that claims that consultation is important and that everybody should have his or her say. So for those reasons ACT will oppose this bill.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022603ae58e-47c4-46f9-bfc8-8355a48988ad\u0022 data-id=\u002221afd33685c74b3f8b410c799a87a1d7\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000329\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022603ae58e-47c4-46f9-bfc8-8355a48988ad\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002221afd33685c74b3f8b410c799a87a1d7\u0022\u003EDr JONATHAN COLEMAN (National\u2014Northcote):\u003C/span\u003E It is a pleasure to speak in opposition to the Injury Prevention, Rehabilitation, and Compensation Amendment Bill. I must say that I think the arguments against it have been very well canvassed by my colleagues Dr Paul Hutchison and Dr Wayne Mapp, and also by Heather Roy. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000330\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022603ae58e-47c4-46f9-bfc8-8355a48988ad\u0022\u003EI think that fundamentally we have a situation that encapsulates some of the philosophical differences between Labour and parties that are of a centre-right persuasion. On the one hand, the Labour Party wants to put forward this legislation that will make accident compensation less efficient. Labour will undermine workplace safety and it will try to impose a one-size-fits-all solution on everyone in the workplace. We know from experience that that will not work. On the other hand, National and ACT are advocating for more competition in accident compensation. We believe that the changes in 1999, although they were in place for only a very brief period, made some real differences in accident compensation and in the workplace. The premiums were lower, there were incentives for people to look at workplace safety, and the system was working more efficiently than previously. The reality, when looking at insurance, is that if we do not have incentives, people will not ensure that workplaces are safe. Everyone will be paying one high premium to a monopoly provider\u2014the situation that we have now\u2014and there will be no incentive for competition in the sector and for enhanced safety in the workplace. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000331\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022603ae58e-47c4-46f9-bfc8-8355a48988ad\u0022\u003EOne of the really concerning things about this legislation is the way it is being rushed through. There is a normally accepted period of 3 months for consultation on changes to accident compensation levies, yet twice in the space of a couple of weeks legislation is being rushed through without the normally accepted consultation period. It is legislation that will not be in the best interests of the country. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000332\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022603ae58e-47c4-46f9-bfc8-8355a48988ad\u0022\u003EI think there is quite a parallel between this bill and the revalidation legislation that was before the House last week. A tired, deceitful Government was pushing through legislation to make the illegal legal. I can say that if any of the Labour members have been out in their electorates\u2014those who have them\u2014over the weekend, they will know that the revalidation legislation is going down very poorly out there. It will be the nail in the coffin for a lot of the Labour members who sit in the Chamber today. It is striking a very negative chord in the heart of New Zealand society. People are not happy about it. They are seeing this Government as an arrogant, tired Government that is trying to absolutely run over the will of the people. I also believe that a lot of the members of the Labour caucus are not very happy about what we have seen in the past week in this House. It has been disgraceful. It has been unprecedented in the history of the New Zealand Parliament, and the people of New Zealand will not stand for it. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000333\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022603ae58e-47c4-46f9-bfc8-8355a48988ad\u0022\u003EIt is not very surprising that New Zealand First is supporting the Government on the bill that is before us today. Last week New Zealand First was very happy to support totally undemocratic legislation that made the illegal legal. It was an unprecedented move, and that party will be out of this Parliament in 2008. It will disappear.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000334\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b63935ee-d78b-43a8-a3bc-996e7951fb9b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00220f4b807ed8d44a418f881fb9da553a4f\u0022\u003ER Doug Woolerton\u003C/span\u003E: We\u2019ll be here.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000335\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022603ae58e-47c4-46f9-bfc8-8355a48988ad\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022552beea864ea4d6190a732de7f11712c\u0022\u003EDr JONATHAN COLEMAN\u003C/span\u003E: Mr Woolerton will not be here, reading his newspaper and snoring away on the cross benches. He will be gone, as well as some of the Labour members. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000336\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022603ae58e-47c4-46f9-bfc8-8355a48988ad\u0022\u003EI come back to the bill. The Government\u2019s proposal to merge the two accounts will result in the socialisation of costs and the benefits of accident compensation. It reflects a move away from the clear incentives that are provided by an insurance-based approach. We in the National Party are clearly very opposed to that. In 2008, when we are back in Government, we will reintroduce the privatisation of accident compensation and reintroduce competition to the sector, because we know that when that was the case in 1999, both premiums and accident rates fell. Labour wants to take a flat approach; Labour wants it to be cost-plus. It does not see the connection between risk and premium. Labour does not recognise that if someone works in a high-risk occupation, that person should pay a higher premium than someone who does not. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000337\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022603ae58e-47c4-46f9-bfc8-8355a48988ad\u0022\u003EIt was interesting that when the Minister spoke\u2014she took the first call\u2014she talked about self-employed people. I think it really illustrates how little the Labour Party really understands about self-employment. She says in the explanatory note of the bill that self-employed people are clustered \u201Cin particular high injury risk industries and occupations (such as forestry, fisheries, and farming).\u201D That might have been the case 40 years ago, but I can tell members that time has moved on. That sort of thinking takes no account of the fact that many self-employed people now work in fields such as catering, the professions, and information technology. In fact, thousands of people in this country are employed in information technology. Why should people who are employed in low-risk professions like information technology or catering pay the same premium as people who are foresters or fishers? That just does not make sense. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000338\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022603ae58e-47c4-46f9-bfc8-8355a48988ad\u0022\u003EThis bill also shows us that Labour is fundamentally anti-business. It does not want to see any differentiation between people who are putting themselves out there, running a business, and taking all the risks. It wants to see them pay exactly the same premium as people who are not putting themselves at risk. There will be cross-subsidisation, and no strong incentives. This law will not reflect the degree of risk that individuals are taking. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000339\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022603ae58e-47c4-46f9-bfc8-8355a48988ad\u0022\u003EIt is sad that under Labour, New Zealanders do not have a choice of insurer when it comes to cover for personal injury. Labour and its union mates want to have a monopoly model in this sector, and they want that to continue. They have socialised insurance, rather than following basic insurance principles. We have to ask ourselves why, after 7 long years in Government, Labour is so eager to rush this legislation through in the space of just a few short months\u2014there is a 3-month period before it comes into effect\u2014without giving the New Zealand public the right to be heard on the matter. The unpalatable fact and the unpalatable answer are that this legislation is all about preparing accident compensation for life under a National Government. It will set up an environment whereby it will be a lot more difficult for private insurers to enter the market in 2008 and to make it work. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000340\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022603ae58e-47c4-46f9-bfc8-8355a48988ad\u0022\u003EIs not this bill all about the Accident Compensation Corporation (ACC) positioning itself for the potential competitive environment, once the electorate has finally rejected this tired, worn-out Government, this deceitful Government, this Government that, frankly, people have had enough of? How, exactly, will ACC be preparing itself for that change in 2008? Basically, ACC will move as many claims as possible to the residual account, which it can control now and, it believes, well into the future. The corporation and the Government do not believe in, and will not accept, the residual account ever being put out to competition. They will greatly reduce the number of claims under the employers\u2019 account management framework, and that will take claims away from the management of employers who are presently within the ACC Partnership Programme. Finally, they will reduce the rating structure by a number of means. They will move claims to the residual account, discount the rate now and then progressively increase it over the following years, and they will remove the rate stability level. They will transfer the liability to the residual account, but not the collected premium, and there is something deeply wrong with that. All of that will result in fewer claims and a lower rate in the employers\u2019 account, and thereby a reduced premium pool. The upshot of it all is that it will be a lot more difficult for private insurers to enter the new market, and to make it work, when National becomes the Government in 2008. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000341\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022603ae58e-47c4-46f9-bfc8-8355a48988ad\u0022\u003ESo there we have it. A clear philosophical difference between the two major parties surrounds this bill. Members of the Labour Party do not believe in competition. They want everyone to be the same. They believe in a cost-plus mentality, and they do not want competition in insurance. The National Party and ACT want to see competition in accident compensation and we will make sure that come 2008, with the change of Government, that is exactly what happens.\u003C/span\u003E\u003C/p\u003E\u003Ca id=\u0022bd2d35b312274e79ab66223dda7e01ed\u0022 name=\u0022division\u0022\u003E\u003C/a\u003E\u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EA party vote was called for on the question, That the Injury Prevention, Rehabilitation, and Compensation Amendment Bill be now read a first time.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EAyes 71\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand Labour 50; New Zealand First 7; Green Party 6; M\u0101ori Party 4; United Future 3; Progressive 1.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENoes 50\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand National 48; ACT New Zealand 2.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EBill read a first time.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022605133aa-6c88-4150-82dd-7d9fcf1824b4\u0022 data-id=\u0022e1e1453a2513412da5a1c34a98365ee3\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000342\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022605133aa-6c88-4150-82dd-7d9fcf1824b4\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022e1e1453a2513412da5a1c34a98365ee3\u0022\u003EHon STEVE MAHAREY (Minister of Education):\u003C/span\u003E I move, That the Injury Prevention, Rehabilitation, and Compensation Amendment Bill be referred to the Transport and Industrial Relations Committee for consideration, that the committee report the bill on or before 18 December 2006, 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, despite Standing Orders 192 and 195(1)(b) and (c).\u003C/span\u003E\u003C/p\u003E\u003Ca id=\u0022ad57b153cf854a3fb1f4ab1249cdcbeb\u0022 name=\u0022division\u0022\u003E\u003C/a\u003E\u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EA party vote was called for on the question, That the motion be agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EAyes 71\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand Labour 50; New Zealand First 7; Green Party 6; M\u0101ori Party 4; United Future 3; Progressive 1.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENoes 48\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand National 48.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EMotion agreed to.\u003C/span\u003E\u003C/p\u003E\n    \u003C/div\u003E\n    \u003Cdiv class=\u0022HpsHansard\u0022\u003E\n      \u003Cp\u003E\u003Cspan class=\u0022HpsProceedingHeading\u0022\u003EBills\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000343\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022f727417966f74e09a2ebf4aec80e0014\u0022\u003EReserve Bank of New Zealand Amendment Bill\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000344\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u00222371fcaeffe34a0dbdc76ff41b336467\u0022\u003EIn Committee\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000345\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u00225daf4119067a4f1a902e90da22c9b406\u0022\u003EPart 1  Reserve Bank of New Zealand Act 1989\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022 data-id=\u0022587758208ccb4b69bdd4bb53a0993ba1\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000346\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022587758208ccb4b69bdd4bb53a0993ba1\u0022\u003EJOHN KEY (National\u2014Helensville):\u003C/span\u003E Madam Chair\u2014Mr Chair; sorry. Clearly, you have not had a sex change. I am terribly sorry. Trust me when I tell you that I was deeply engrossed in a conversation of national interest.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000347\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c437bda8-4741-4ac5-89ab-b0818e1ab9fa\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002277d452e3c28f4b8a9ec860f9a7d7770f\u0022\u003EDarren Hughes\u003C/span\u003E: Which \u201CNational\u201D is that?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000348\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022271b04b613064a88890b98d2945c2a70\u0022\u003EJOHN KEY\u003C/span\u003E: Well, actually, \u201Cnational\u201D as in the wider country. I would be very happy to explain my logic to the member, if he wants.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000349\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003EI rise on behalf of the National Party to address Part 1 of the Reserve Bank of New Zealand Amendment Bill, which the National Party is supporting. I remind members that, really, the essence of the bill is relatively simple. In essence, under this bill, which is the result of deliberations by the Trans-Tasman Council on Banking Supervision\u2014members of which include the Reserve Bank of New Zealand and the equivalent body in Australia, the Australian Prudential Regulatory Authority\u2014both countries will have observance of each other\u2019s jurisdiction, and give consideration to the financial stability and financial management of banks on either side of the Tasman.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000350\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003ETo come back to the case in point, members will know that if they look closely at the banking scene in New Zealand, they will see that around 85 percent of banks are owned by Australian institutions. There is clearly a huge degree of integration of the Australian and the New Zealand banking systems. In fact, if one looks at the assets comprising financial institutions in New Zealand, one sees that around 75 percent of those assets come from Australian-owned banks in New Zealand. So the level of integration is extremely high. Of course, it makes tremendous sense to ensure that there is a huge degree of cooperation between the regulatory bodies on both sides of the Tasman.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000351\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003EPart 1 talks to a degree about the definition of financial institutions and, in fact, about what financial institutions are. Members will also be aware that what comes under the purview of the Reserve Bank of New Zealand in terms of financial institutions is actually quite different from what comes under the purview of the Australian Prudential Regulatory Authority. In New Zealand the Reserve Bank has regulatory oversight of only the major banks; finance companies, for instance, fall outside its purview. In Australia that is not the case. Under the Australian Prudential Regulatory Authority\u2014as in the United Kingdom under the Financial Services Authority\u2014there is a much wider review process that includes major commercial banks, as we would understand them, finance companies, as we would understand them, and insurance companies. That is also the case in the United Kingdom, but it is not the case in New Zealand.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000352\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003EThis issue raises an interesting point. What we have seen over the last 4 or 5 years is an explosion of the assets contained within finance companies in New Zealand. I think those companies now control something in the order of $12 billion to $14 billion worth of assets. Those assets are controlled by institutions that are not reviewed by the Reserve Bank of New Zealand. They fall outside of this bill. I think it is interesting that we have seen in recent times the collapse of at least three of those finance companies. I suspect that we have not seen the last of collapses of finance companies in New Zealand. I suspect that over time there will be, as there already has been, a greater call from some parts of the community for greater forms of financial regulation of finance companies in New Zealand. That is a debate the National Party is happy to engage in at a later stage.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000353\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003ESecondly, let me make the point that it makes enormous sense for New Zealand to work closely with Australia. I could choose any of the Australian-owned banks, but for the purposes of this explanation let me choose Westpac in New Zealand. Clearly, if Westpac operates successfully here in New Zealand, then part of that success will come from the strength of its parent company. Clearly, it makes sense for the Australian Prudential Regulatory Authority to work very closely with the Reserve Bank of New Zealand, because it is extremely difficult for the Reserve Bank of New Zealand to go about its normal review process of Westpac in New Zealand unless it has full and frank knowledge and information. I was involved in global investment banks, particularly Merrill Lynch, whose main regulator was the Federal Reserve System, even though we operated on the ground in numerous countries. Let us take, for example, the UK. \u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002270fa4cbd-9380-4916-9f2a-78da059d220e\u0022 data-id=\u00224518c577230841fb8ba357eb4570f2ab\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000354\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002270fa4cbd-9380-4916-9f2a-78da059d220e\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00224518c577230841fb8ba357eb4570f2ab\u0022\u003EThe CHAIRPERSON (H V Ross Robertson)\u003C/span\u003E: The question is that Part 1 be agreed to. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000355\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b63935ee-d78b-43a8-a3bc-996e7951fb9b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022c5e497a9a2e04585bf4a4eb8e71bb433\u0022\u003ER Doug Woolerton\u003C/span\u003E: Mr Chairman\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000356\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002270fa4cbd-9380-4916-9f2a-78da059d220e\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022951e6f72dddd4d61a0e83ff5e57a096e\u0022\u003EThe CHAIRPERSON (H V Ross Robertson)\u003C/span\u003E: Sorry? The member was calling?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000357\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b63935ee-d78b-43a8-a3bc-996e7951fb9b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00220bf1ac4c1896400e967f856c77afa36d\u0022\u003ER Doug Woolerton\u003C/span\u003E: Carry on. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000358\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b63935ee-d78b-43a8-a3bc-996e7951fb9b\u0022\u003EPart 1 agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000359\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u0022b4df9f2f51884d458491c384f5048e19\u0022\u003EPart 2  Racing Act 2003\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022 data-id=\u00229812029aa1774c069e90ff61c533c88f\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000360\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00229812029aa1774c069e90ff61c533c88f\u0022\u003EJOHN KEY (National\u2014Helensville):\u003C/span\u003E One thing that excites me about my Part 2 speech is that I know that Mr Woolerton will also make a Part 2 speech, seeing as he missed getting the call in the Part 1 debate. I urge him to wrap both parts into one speech, because it is very similar stuff.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000361\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003EI rise to address Part 2 of the Reserve Bank of New Zealand Amendment Bill. This is the part that amends the Racing Act 2003. Members will be aware that the Reserve Bank of New Zealand Amendment Bill is an omnibus bill that makes alterations to both the Reserve Bank of New Zealand Act and the Racing Act. If people look at, in particular, clause 12, \u201CRacing clubs may conduct equalisator betting\u201D, they will see that it states: \u201CSection 51(3) is amended by omitting \u2018section 60(2) and (3),\u2019 and substituting \u2018rules made under section 52 stating the denomination to which dividends are to be rounded and paid out,\u201D. I think members know that that means dividends will be rounded down, because of the withdrawal of 5c coins, to the nearest multiple of 10c.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000362\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003EMy colleague Mr Tisch, who is very, very widely regarded in racing circles, led the charge for the racing industry at the last election. We saw horses parading before the election with \u201CFair Tax\u201D tattooed on their hindquarters, which was all about getting some fairness and equity for the racing industry in New Zealand. When National announced its racing policy, I do not know how Lindsay coped, actually, with the sheer volume of cards, of emails, of phone calls, of messages of goodwill and thanks to the National Party. For once people saw the Labour Party\u2019s true colours\u2014that it is a party that does not believe in racing. I know that Mr Hughes wanders along to on-course betting at \u014Ctaki, at whatever races they have down there\u2014they probably do not have any\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000363\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c437bda8-4741-4ac5-89ab-b0818e1ab9fa\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00225049e6c089244c0caf31c3468700ffa5\u0022\u003EDarren Hughes\u003C/span\u003E: Yes, we do! We\u2019ve got three racing clubs.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000364\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022f3675e0361ed4b35addef1964491f7bf\u0022\u003EJOHN KEY\u003C/span\u003E: Actually, they do. I know the Otaki Racing Club is quite active. I know Mr Hughes goes there and tries, even now, to cajole the members of the club into thinking that Labour believes in racing, but the real truth is that the party that led this fair tax policy, which has brought out much greater support for the racing industry, was the National Party. In fact, even though my colleague\u2014or my friend, I can almost say\u2014from New Zealand First Mr Woolerton will get on his feet and try to claim some credit on behalf of New Zealand First, because the policy was part of its coalition agreement with Labour, the truth, as Mr Woolerton knows, is that New Zealand First got it as part of its coalition arrangement only because National had it. National introduced it and National brought it up. [Interruption] Those members from Labour are chipping away here, but they are filled with grief, remorse, and guilt that they had not done for the racing industry what National in 5 minutes worked out was necessary.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000365\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003ERacing is a very important industry indeed. It has a huge impact on New Zealand. It is not just the betting side, which brings a lot of joy and enjoyment; racing also does a lot for \u201CBrand New Zealand\u201D, as I think New Zealanders recognise. I was interested this morning, as other New Zealanders would have been, to read in both the New Zealand Herald and the Dominion Post about Phar Lap being poisoned by arsenic. As I flew into Wellington Airport in the 140-kilometre-an-hour gales in my Boeing 737, I did whatever I could to deter my thought process from wondering what sort of obituary about me would appear in the paper this afternoon. Even though the horse died in 1936\u2014or whenever it was\u2014I asked myself what sort of individual would try to poison Phar Lap with arsenic, as I came into Wellington Airport sideways in a Boeing 737, with the pilot looking away from the runway with deep concern.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000366\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003ELet me just return to the Racing Act 2003, having allowed New Zealanders to understand who should be claiming the credit for the changes to the racing industry and the fair tax\u2014[Interruption] That was the National Party, I say to Mr Gosche. I expect him to get on his feet and thank the National Party for doing that. But let me just make it clear that, in terms of dividends being rounded down by the Racing Board, we on the select committee had an assurance from the board that that will not affect the amount of dividends paid out. That will not change. I know that the chairman of the Finance and Expenditure Committee, Mr Jones\u2014\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022b63935ee-d78b-43a8-a3bc-996e7951fb9b\u0022 data-id=\u0022f6fd69196d00482bbdc442c7851762ac\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000367\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b63935ee-d78b-43a8-a3bc-996e7951fb9b\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022f6fd69196d00482bbdc442c7851762ac\u0022\u003ER DOUG WOOLERTON (NZ First): \u003C/span\u003EIn speaking to Part 2 of the Reserve Bank of New Zealand Amendment Bill, I must say that Sir Patrick Hogan\u2014beavering around in his stables, as he does, shovelling manure and all that sort of thing, as a good Waikato man\u2014would be amazed to hear that speech from John Key. He would be amazed to know that Lindsay Tisch was racing around at the last election trying to promote taxation changes to the racing industry. Because he would know, being a sensible, very astute businessman, that he had hosted many, many functions on behalf of the National Party, and I have been to a few of them at his stud. He was on and on forever about the taxation of the racing industry, and National never listened. It never listened, and it took the Rt Hon Winston Peters and New Zealand First, in cooperation with the Labour Party, to deliver the changes that Patrick Hogan had been looking for all of these years. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000368\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b63935ee-d78b-43a8-a3bc-996e7951fb9b\u0022\u003EHe must be\u2014and I am talking to Part 2 of the bill\u2014a very disillusioned man to know that his hospitality, his generosity, and his famed ability to bring people on board has been treated in such a way for so many years. It took a relatively new party to deliver that which he had been promised but what was never delivered in all of those years. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000369\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b63935ee-d78b-43a8-a3bc-996e7951fb9b\u0022\u003EIt is true that this bill looks after the taking out of circulation of the 5c and 10c coins. It is true that it gives the Racing Board the ability to take care of its own business in the future\u2014it will not have to come back to the House any more for this sort of legislation. It is true that dividends will be rounded down rather than up, but the board has assured us\u2014as the chairman, and now Mr Key, has said\u2014that it will take account of that in its expenditure, and it will make sure that it makes relevant savings and that the punters do not actually lose, out of that. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000370\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b63935ee-d78b-43a8-a3bc-996e7951fb9b\u0022\u003EBut I will say a couple of things more, and I say, in light of previous discussions in this Chamber around gambling, casinos, and those sorts of things, that New Zealand First understands that this is an industry that has approximately 30,000 to 35,000 people employed nationwide, that does have a gambling component, but that exports\u2014and \u201Cexports\u201D is the critical word. It is no good for National members to sit there saying that this Government, or New Zealand First, does not believe in exporters, because National, when it has the opportunity, does not put one incentive in place, does not put one tax right down in place, and does not believe in enhanced depreciation, otherwise it would have done it for the racing industry, as we have. It does not believe in any of those things. It would sooner support gambling and casinos that suck money out of this country\u2014mainly from the poor\u2014into the rich coffers, mainly of American and Australian owners. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000371\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b63935ee-d78b-43a8-a3bc-996e7951fb9b\u0022\u003EWe in New Zealand First think that that is wrong, because horse racing in this country, which we are talking about in Part 2 of the bill, puts money into New Zealanders\u2019 pockets, and it makes sure that it stays there. It does not go offshore to the same degree that casino money does. So we have no hesitation in showing preference for this industry, over and above others. We think it is absolutely right that a Government should\u2014yes, I will use the words\u2014pick winners in this way. We do not pick the winners as in personalities, but it is certainly the job of a Government to pick winners when it comes to exports, when it comes to imports. This is an industry that fulfils all of the criteria, and deserves the help that New Zealand First has ensured it has, and we look forward to supporting it in the future. \u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022f44431ef-b505-4e94-9f57-a60b0a569bf7\u0022 data-id=\u00225a7b3d41a7824c8ea8c6f1dfed1d99b0\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000372\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f44431ef-b505-4e94-9f57-a60b0a569bf7\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00225a7b3d41a7824c8ea8c6f1dfed1d99b0\u0022\u003ESHANE JONES (Labour):\u003C/span\u003E Kia ora, Mr Chairman. I stand to elaborate on one or three things that were said last week in relation to this Reserve Bank of New Zealand Amendment Bill, and to correct the predictable and tired rhetoric from our colleague on the other side of the Chamber Mr Key on this very important bill. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000373\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f44431ef-b505-4e94-9f57-a60b0a569bf7\u0022\u003EI am referring, of course, to Part 2. I know that he who rides a Shetland pony in the Waikato is soon to speak to this issue. However, I think of particular importance to this portion of the bill is the reassurance that the Finance and Expenditure Committee was given\u2014[Interruption] OK, I hear all the nags whinnying from the other side of the Chamber. It is not my fault that a number of them are preparing for a dress presentation\u2014a dress circle foray\u2014or something like that. They are debating amongst themselves what sort of double or trifecta they will back. Of course, we have had one Mr English\u2014an English horse\u2014who got on the track too early. He had not actually had the experience of sitting in Opposition. It has taken him 5 years to try to find his stride. He has thrown everything on to the track\u2014[Interruption]\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000374\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002270fa4cbd-9380-4916-9f2a-78da059d220e\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002211c9f5ecb2cd435d9fc58912377a2fa9\u0022\u003EThe CHAIRPERSON (H V Ross Robertson)\u003C/span\u003E: Order!\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000375\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f44431ef-b505-4e94-9f57-a60b0a569bf7\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00226a21ae7598a24e608c5662b51b343dd0\u0022\u003ESHANE JONES\u003C/span\u003E: Yes, Mr Chairman, I think a couple of scratchings on the other side of the Chamber would be in order. It would make those members disappear from the track for a time while we on this side, who are much more lucid and coherent contributors, make our points. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000376\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f44431ef-b505-4e94-9f57-a60b0a569bf7\u0022\u003EHowever, moving right along, I point out something those members said that was very, very silly and actually unwise. They said earlier today that our friends from New Zealand First did not have any role in, or did not contribute towards, the great reforms and improvements relating to the racing industry. Of course, as we on our side of the Chamber have intimated, we are only too prepared to look after the interests of those who know what stable Government is about and who know how to look after their friends. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000377\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f44431ef-b505-4e94-9f57-a60b0a569bf7\u0022\u003EI come back to the bill. We had a number of\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000378\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00221c0514009f274e17a6c1e941a01504ff\u0022\u003EHon Member\u003C/span\u003E: Pay it back!\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000379\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f44431ef-b505-4e94-9f57-a60b0a569bf7\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00229b31dbee60b64f93b77dc30ac14c4865\u0022\u003ESHANE JONES\u003C/span\u003E: On the question of paying it back, I look forward to the next discussion we have about tax\u2014in particular, GST\u2014before I hear any more comments about paying it back. What if every businessperson, every horse owner, or every stable owner in Te Tai Tokerau, Matamata, or anywhere else in Aotearoa could actually wander off, gaily, unimpeded, tell their creditors to haera r\u0101, and not fulfil their tax obligations! What we will actually see is the old grey gelding, Dr Brash, bring back a bill to try to make his arrears go away. No, no, no! Those members can think again if they think the New Zealand public will not hear about that. The public will hear about it a great deal. It is as if National thinks it is watching a winner. But it will not be a winner; it will be like a horse on the way to the knackers\u2019 yard. [Interruption] The member should not worry. We will serve that up with great lashings. In fact, it will be like the molasses served up in the Waikato. It will be like a bit of that old, dry hay that our man Mr Tisch gives to his horses, few of which have yet to yield much of a win. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000380\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f44431ef-b505-4e94-9f57-a60b0a569bf7\u0022\u003EHowever, let me go back to the very important content of this bill. Representatives from the industry came to the Finance and Expenditure Committee and reassured us that those who are regular participants in the fun and the betting frenzy at the various racetracks will not be disadvantaged. As I said earlier, the people on our select committee are a relatively competent bunch. Competence sort of ebbs and flows, depending on the issue, but I can reassure the Committee that it is generally at the high-tide mark where the chair is concerned. We were reassured that the participants in the industry\u2014the regular contributors\u2014would not be disadvantaged. I agree with Mr Key that in the event that that does not come to pass, it would be a very, very dark day for the people who represented the industry at the select committee, because we were approached and were reassured that that was the case. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000381\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f44431ef-b505-4e94-9f57-a60b0a569bf7\u0022\u003EI will continue on. John Key said earlier today that there is no site in \u014Ctaki for people to expend energy in the pursuit of racing gains. Well, if there is ever a reason why our man Mr Key needs to broaden his current level of interest, and address his very shallow level of experience, in what is happening up and down the country, and to come out of the money rooms, then it is to find out that \u014Ctaki is a very illustrious site in terms of the racing industry\u2014of racing pedigree\u2014and that the site belongs to Ng\u0101ti Raukawa. Kia ora t\u0101tou.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022 data-id=\u00222518deac848742efa38dddc66c0e9bd3\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000382\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00222518deac848742efa38dddc66c0e9bd3\u0022\u003ELINDSAY TISCH (National\u2014Piako):\u003C/span\u003E This is important legislation, and I can assure the previous speaker, Shane Jones, that my Shetland pony is running quite well. In fact, it ran third last week.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000383\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022d52e59e3-2195-4c95-a654-665c11b39b63\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022fdba5ccb8b6846ceb940120c968ed7dc\u0022\u003EHon Parekura Horomia\u003C/span\u003E: What\u2019s its name?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000384\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00228ff29d0ed3104bf081027f0a5c8bc1e5\u0022\u003ELINDSAY TISCH\u003C/span\u003E: It is called Mum\u2019s a Honey. How is that for a name? The Minister should write that down. When it races this week, it will run better than third; it will run first. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000385\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003EBut I have a bet for this Committee, and it is a trifecta. Do members opposite want inside information? In terms of this trifecta, I bet that at the next election Labour will be out. That is a sure bet. Members should put their money on the fact that Labour will be gone. That is a sure bet, and I know they will make money out of it. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000386\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003ERacing is important in the Waikato. If we look at the Mercedes awards just recently\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000387\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022263be082-dd01-4ef1-9c19-d546d0174793\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022cf67bd6e992a4aed9d732d2fbf9e388b\u0022\u003EHon Mark Gosche\u003C/span\u003E: What\u2019s this got to do with 10c?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000388\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00220d742cc9dba1419ea46a69c9c68fbf01\u0022\u003ELINDSAY TISCH\u003C/span\u003E: This has a lot to do with 10c. Others have talked about it, but if we look at the New Zealand Thoroughbred Racehorse Owners Federation magazine, Racehorse Owner\u2014and this is where the 10c is so important\u2014we will see that it was a proud night for those from the Waikato, particularly the Piako electorate, which includes Cambridge and Matamata. Members should listen to this. The Mercedes Owner of the Year award went to Ann Brown from Cambridge. The leading jockey was Mark Walker from Matamata. The best contribution to racing went to Waikato Stud, owned and operated by Garry and Mary Chittick and Mark and Lisa Chittick. Of course, last year Garry Chittick of Waikato Stud won a Mercedes Breeder of the Year award. So there is a lot of support there, and I am proud to be able to stand up and support racing and what it means, not only to this region but to the country as a whole.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000389\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022b63935ee-d78b-43a8-a3bc-996e7951fb9b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022514c1a8856284230bdb629754e3d404e\u0022\u003ER Doug Woolerton\u003C/span\u003E: When you had a chance, you didn\u2019t do a thing.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000390\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022c6a353e9f71443eb9a3df730f24e2fa1\u0022\u003ELINDSAY TISCH\u003C/span\u003E: The member says we did not do a thing. It was National\u2019s policy that New Zealand First ran with at the election. It was plain to us when we sat on platform after platform before the election that the Minister for Racing at the time had absolutely no interest in racing whatsoever. At Te Rapa Damien O\u2019Connor had absolutely no interest in racing. It was only because we put pressure on that we are able to show the importance of racing and what it brings in the way of jobs\u2014and to the brand, as John Key said\u2014and what it means to New Zealand as a whole. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000391\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003EWhat does this bill actually do? If we are to be competitive, then we need to have some commonality with Australia. It is very, very easy to bet on Australian horses. If we are not going to be competitive and have the flexibility that is so important in racing, then we will lose our market offshore. It is very easy to bet offshore, and this bill will bring us some commonality in terms of what will happen with the 5c situation we currently have and our move to rounding off to 10c. The proposed amendments to the Racing Act will allow the Racing Board to round down dividends within the rules. Of course, from 1 November we are doing away with 5c coins. They will no longer be available. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000392\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003EBut what does it actually mean in terms of the payouts and who will win and who will lose? The bet type will change its current deduction of 15.5 percent down to 14.5 percent. Deductions on a place type will go from 15.5 percent down to 14.25 percent. Overall, if we look at the turnover in 2005-06, we will see that it was $1.364 billion. The dividends paid to the punters, the customers, under the current system amount to $1.106 billion. Under the proposed rounding-down scheme, they will amount to $1.1105 billion. There is a $4.4 million advantage to the punters. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000393\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003ESo National does support this legislation, because the customer, the punter, will not miss out. There were some thoughts earlier on that those people may be disadvantaged by this move, but that will not be the case. We have to have a rate determined by the Racing Board. We need commonality with Australia. That is what is so important. That is the flexibility to meet the market. National has much pleasure in supporting not only the whole of the Reserve Bank of New Zealand Amendment Bill but particularly, from where I am speaking, Part 2.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000394\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003EPart 2 agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000395\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u002205af26294f624eaa88168f3898568e7e\u0022\u003EClause 1 agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000396\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u0022671a603056a7431890a870aeae531484\u0022\u003EClause 2 agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000397\u0022\u003EThe Committee divided the bill into the Reserve Bank of New Zealand Amendment Bill and the Racing Amendment Bill, pursuant to Supplementary Order Paper 65.\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000398\u0022\u003EBill to be reported without amendment presently.\u003C/p\u003E\n    \u003C/div\u003E\n    \u003Cdiv class=\u0022HpsHansard\u0022\u003E\n      \u003Cp\u003E\u003Cspan class=\u0022HpsProceedingHeading\u0022\u003EBills\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000399\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022bdec20bcb6c7485fa6829a59c382d90a\u0022\u003ECommunications Legislation Bill\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000400\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u0022bc030632716b4659a91cd41f14f58c41\u0022\u003EIn Committee\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000401\u0022\u003EDebate resumed from 10 October.\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000402\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u002283ba99f09d53492e8c2c2109e06946e4\u0022\u003EPart 2  Amendments to Radiocommunications Act 1989\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022 data-id=\u002290c66ce418d64b29acf74de6898b0099\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000403\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002290c66ce418d64b29acf74de6898b0099\u0022\u003EPANSY WONG (National):\u003C/span\u003E We are very pleased to resume the debate on this legislation. There are three issues that we would like to bring to the attention of the Committee. First is the issue with regard to the position advised by the officials that stereos in second-hand Japanese cars that may not receive radio signals would not be considered an inappropriate device that would interfere with the allocation of radio frequency. National agrees with that position. In my hand I am holding a copy of the Ministry of Economic Development\u2019s information leaflet on the FM reception problem, and the Commerce Committee is quite comfortable for that education approach to be taken. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000404\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EI would like to seek comments or commitments from the Minister in the chair, Pete Hodgson, on the next two issues that I bring to the attention of the Committee, because National members on the select committee were assured of some conditions before we agreed to continue to support this part. The first issue is the introduction of the possibility that, in future, the allocation of radio frequency will be conducted by means other than a competitive process. Some submitters showed a lot of nervousness about what the Labour Government could do in terms of interference and the introduction of a lack of transparency into the process. For example, one submitter suggested that these provisions allow the Government to allocate radio frequency by means other than a competitive process, which means that the Government can choose whom they negotiate with. Some commercial operators, indeed, feel very nervous. They reckon that under the existing legislation there is provision for Government to do that anyway. The submitter reckoned that this new provision was introduced to allow the Crown to require further payment to be made when radio licences are allocated by those other means, because under Part 13 of the existing Radiocommunications Act the Crown could allocate those radio frequencies anyway. So is it an issue of introducing further levy payments by stealth? I think the Minister in the chair should take a call to assure those submitters that the introduction of this new provision to allow radio frequency to be allocated by arrangement or agreement is not an underhand way of charging further fees to those organisations who may be the successful recipient of frequencies. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000405\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EThe other prospect of introducing this flexible mechanism raised a concern by others about the Government allocating those very sought-after radio frequencies in a very non-transparent manner. We heard the Minister not too long ago announce two additional frequencies for commercial use and two for community use in the various regions. Putting the community frequencies aside, if the allocation of commercial frequencies is to be awarded without a transparent competitive process, some people are concerned about what the criteria are and who is likely to receive those frequencies. They are a very marketable product. In fact, people in the market to acquire radio frequencies could find that they attract very high prices. I believe that the Minister in the chair should take a call to assure the public that the introduction of new frequencies does not have a hidden agenda for interference by Government. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000406\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EThe second issue I would like to raise before my other colleagues take a call\u2014and once again I urge the Minister to rise and give the public an assurance\u2014is the issue raised by the Radio Frequency Users Association of New Zealand. This association is a non-profit organisation consisting of members such as local government authorities and transport, communications, courier, forestry, farming, taxi, and consultancy organisations. These members use a number of different radio bands, mainly for non-profit purposes. They are very anxious that, in the first instance, they were not consulted on this legislation, and they were very, very unclear as to what the impact would be on them. They are seeking an assurance that they will have security of tenure. During the select committee process I recommended, with the support of all the members, that the chair ensure that officials carry out further consultation with this group. But at the time we came to deliberate, the issue had not really been resolved. That association wrote to us again and said it was nervous and had not been reassured of the tenure of those frequencies for non-profit users. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000407\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EThe association also suspects that the driving reason for officials not supporting its amendment to secure its tenure is that the officials are already planning further conversions of some of the spectrum to other uses. I tell the Minister that National has agreed to support the bill only on the assurance of the officials that the Government is in the process of reviewing, in this financial year, the security of tenure for all radio licences. The officials said that this would address the concerns raised by that association. The officials have said that the proposition to offer great certainties of tenure to holders of the radio licences is a good argument, because that might facilitate the increased investment in radio infrastructure. However, they claim that at this stage policy work on this issue needs to be undertaken, with full consultation. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000408\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EI tell the Minister that I think this is a very, very serious issue. The Radio Frequency Users Association is responsible for a lot of the transmitted emergency community news. The fact that it was not consulted in the first instance has led to the select committee requesting the officials to go back to the association and hold a consultation. I understand that at this stage it has not been fully resolved. I would like to see the Minister in the chair take a call to reassure the public and the Radio Frequency Users Association that the policy work is genuinely under way and there is no hidden agenda to assign the frequencies currently operated by it for other usage. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000409\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EIt is incumbent on the Government to give that assurance to ensure the continued support of National on this issue. We have accepted the words of the officials at this stage, but it would be helpful if the Minister could take a call to assure us that in the meantime, before the policy work and the consultation is undertaken, there is no hidden agenda or plan to convert the spectrum that at the moment is operated by the Radio Frequency Users Association for other purposes. Otherwise, National will continue the Committee stage. I am sure that my good colleagues will support me. I can see that Chris Tremain is ready to charge on furthering that questioning.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022 data-id=\u00223c9e2844a53f45339b3b7f03e7061db4\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000410\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00223c9e2844a53f45339b3b7f03e7061db4\u0022\u003ECHRIS TREMAIN (National\u2014Napier):\u003C/span\u003E I rise to speak to Part 2 of the Communications Legislation Bill. Members of the public who are listening will be aware that it has probably been a couple of weeks since we have spoken in the Committee stage of this bill. As a quick reminder of where we have got to, I point out that the Communications Legislation Bill is an omnibus bill that attends to both the Telecommunications Act 2001 and the Radiocommunications Act 1989. Listeners may recall, if they were listening to the debate on this earth-shattering legislation, that in Part 1 we dealt with the Telecommunications Act. Right now we are looking at the Radiocommunications Act 1989 and some amendments to that Act. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000411\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EAs Minister Cunliffe said in the first reading, the bill is aimed at maintaining a commercial environment of certainty and confidence for both telecommunications services and use of the radio frequency spectrum. So from that point of view the National Party certainly supports that and is behind the bill in that regard. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000412\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EBoth parts of the bill are narrow in scope. That is demonstrated in Part 1 by there being only one substantive clause, which amends the Telecommunications Act. The wider bill is not related to the decisions of the broader telecommunications legislation that is currently before the Finance and Expenditure Committee, so members of the public should not be confused by that. That bill is proceeding. At the Finance and Expenditure Committee we are dealing with the local loop unbundling and we should be reporting to the House on that particular bill in, I believe, early December. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000413\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EIn terms of Part 2, there are two key things on which we need to focus. One matter that my colleague Pansy Wong discussed earlier is the issue of inappropriate receivers. If we look at the purpose of the bill set out in Part 2, we see that it deals first with inappropriate receivers. Clause 6 states: \u201CThe purpose of this Part is to \u2026 (a) provide that radio engineers and others considering questions of interference and technical compatibility should not have regard to the reception of radio waves by inappropriate receivers:\u201D. To many people that might sound like a heck of a lot of gobbledygook, so I will attempt to explain exactly what we are talking about here because it is somewhat confusing. In fact, it all comes down to property rights and whether people who own parts of spectrum are receiving their property rights. CanWest took a court case back in 2004 in Christchurch. The case was between two radio stations, More FM at 92.1FM and Niu FM at 104.1FM. CanWest, the owner of More FM, took legal action against Niu FM for infringement of its property rights because it believed that there was significant interference being emitted on its signal and it was being confused with the Niu FM signal. As a result of that the two signals were combining in the same radio frequency and, therefore, More FM believed that it was losing a property right. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000414\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EPart 2 of this legislation aims to overcome that. It states that irrespective of that particular situation it will not change the actual law. It comes down to the actual receivers in cars. The situation that has arisen with Japanese cars is that in Japan, the frequency on which FM stations are received is between about 76 and 90 megahertz, whereas in New Zealand we receive it on the frequency between 87 and 108 megahertz. Since Japan uses a different spectrum band for radio broadcasting\u2014as I have said, 76 to 90 megahertz\u2014the radios that turn up in New Zealand in imported cars are incapable of reception above 90 megahertz. So, for instance, we were talking 92.1FM, which was above that level so it became a problem. It also includes the majority of New Zealand stations, which are in the higher band spectrum. If we think about our own FM stations\u2014in Hawke\u2019s Bay, for instance, we have 92FM\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000415\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022659f6556-09a1-4ead-bc52-05cbdb4eaab8\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022a5ff60e43d3a4e7c98a2441779b728f0\u0022\u003ECraig Foss\u003C/span\u003E: Hauraki.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000416\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022aada7db930554903af3fcd809397e6ea\u0022\u003ECHRIS TREMAIN\u003C/span\u003E:\u2014and Radio Hauraki, which Mr Foss listens to\u2014they tend to be at the higher end of the spectrum. When Japanese cars come over here, with their bands at between 76 and 90 megahertz, in order to pick up 92FM in Hawke\u2019s Bay people need to do one of two things. Firstly, they can put in a new radio. \u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022659f6556-09a1-4ead-bc52-05cbdb4eaab8\u0022 data-id=\u002247febe3d0e1645cc947857eeb3fd6e91\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000417\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022659f6556-09a1-4ead-bc52-05cbdb4eaab8\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002247febe3d0e1645cc947857eeb3fd6e91\u0022\u003ECRAIG FOSS (National\u2014Tukituki):\u003C/span\u003E I rise on behalf of the National Party to speak on the Communications Legislation Bill. Previous National speakers have alluded to the fact that, yes, we are supporting this bill. First, though, I have to declare an interest, having lived in Japan for a couple of years. Frustratingly and sadly I brought home a few Japanese radios and what at the time I thought were flash stereos, and I cannot pick up anything after 90 megahertz. I cannot even pick up Radio Kahungunu, The Rock, Radio Hauraki, and so on. So I learnt a lesson there. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000418\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022659f6556-09a1-4ead-bc52-05cbdb4eaab8\u0022\u003EIn doing a bit of research for the Committee stage today I was looking at the Minister\u2019s first reading speech. I have here a couple of interesting quotes from the Minister when he introduced the bill. Minister Cunliffe talked about Part 2, which we are dealing with now. He said that the changes in Part 2 were \u201Clargely of a technical nature, but they are critical for the efficient functioning of the regulatory environment for services that require use of the radio frequency spectrum.\u201D Then\u2014and this is most important\u2014he spoke of the underlying spectrum licences that are created for periods of up to 20 years, which gives certainty of investment for services using the radio spectrum. Those comments, on their own, are fine. It is nice rhetoric, but as with so much of the current administration, they are nice ideas but there is hopeless, hopeless execution. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000419\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022659f6556-09a1-4ead-bc52-05cbdb4eaab8\u0022\u003EAs I said, I would like to speak on Part 2, and in particular on clause 6. Clause 6 deals with radio licensing, spectrum management, etc. I would like to touch on the WiMAX spectrum, of which our Ministry of Economic Development has been undertaking auctions over the last couple of years. It is the 2.5 to 3.5 gigahertz part of the spectrum. For the uninitiated out there, they come in pairs. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000420\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022659f6556-09a1-4ead-bc52-05cbdb4eaab8\u0022\u003EMembers will remember that the Minister said we need certainty of investment and that these spectrum licences were for 20 years. I would just like to quote from a couple of written questions that I asked the Minister, and his replies. They are quite illuminating. This is a reply I received on 10 March when I asked the Minister whether he was satisfied with the distribution of the 3.5 gigahertz WiMAX spectrum, and, if so, why. The Minister said that yes, he was satisfied that the spectrum in question had been allocated appropriately. I thought that was interesting and I will tell members why in a minute. Another question I asked was whether he was satisfied with the process of the allocation of the 3.5 gigahertz WiMAX spectrum; if so, why. The Minister said that yes, he was satisfied that the allocation process to date had been fair and equitable and that it met the policy intentions of the Government. Again, that reply was received on 10 March 2006. Finally I asked the Minister what the original time frame was for the allocation of the 3.5 gigahertz WiMAX spectrum and whether any adjustments had been made to that timetable; if so, why. The Minister answered\u2014and I ask members to bear with me\u2014\u201CThe process for allocation of area spectrum licences in the two remaining Crown-retained management rights\u201D\u2014they are the ones that are up for auction\u2014\u201Cwas originally planned to be completed in late 2005. It is now expected that this will be completed in April or May 2006.\u201D\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000421\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022659f6556-09a1-4ead-bc52-05cbdb4eaab8\u0022\u003E Well, I say to the Minister that we are in October 2006 now, so that was 6 or 7 months ago. The WiMax auction\u2014the allocation\u2014is still going. The result has been an absolute shambles. There has been delay upon delay upon delay. There have been cancelled auctions. There have been suspended auctions. There have been further investigations of auctions. Winning bids\u2014as part of the spectrum, as part of this efficiency and certainty that the Minister speaks of\u2014have not been able to prove, and they do not have the resource to come up and pay for their winning spectrum or auction. I wonder whether the Minister is even aware of that, because in the telecommunications industry, in the sectors, on the blog sites, etc., it is pretty easy to find out that stuff. Again, I think the execution of what is a good idea is absolutely hopeless. Not only can the winning bids not even afford to pay a deposit now, but they have no resource whatsoever to pay the balance. I believe that the minimum was 17c per head per region. Some of the winning bids have no background whatsoever in telecommunications. They have no network in the telecommunications industry. How on earth will New Zealand move its infrastructure forward, when after virtually 2 years, when this auction was first started, we really have no one off the ground? We have nothing but a few headlines.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00229c0eba1d-17a6-44e2-a9b3-2e2535339570\u0022 data-id=\u0022ee7f5041e3754cba96d40f7f1af56317\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000422\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00229c0eba1d-17a6-44e2-a9b3-2e2535339570\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022ee7f5041e3754cba96d40f7f1af56317\u0022\u003EHon PETE HODGSON (Minister of Health):\u003C/span\u003E I rise to make a contribution to the debate on behalf of my colleague the Minister of Communications, not that I am myself a person with great expertise in this matter, I might say. Following on from a contribution from Pansy Wong and, perhaps, National Party colleagues prior to her\u2014I was not listening to the debate earlier\u2014and certainly subsequent to her, it seems that the National Party is unaware of some recent developments. If I can give the tenor of those to the House, it might help progress the debate. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000423\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00229c0eba1d-17a6-44e2-a9b3-2e2535339570\u0022\u003EMy colleague the Minister of Communications met with David Thompson, chairman of the Radio Frequency Users Association, last Monday and sent him a letter last Wednesday. If I put into the public record a couple of paragraphs from that letter, it may help. I will give the essence of it: \u201CI have already agreed that the issue of security of tenure for radio licences should be addressed urgently, commencing with the release of a discussion paper.\u201D He then goes on to point out that the discussion paper is due to come out later this year with decisions in June of 2007. The letter continues, importantly: \u201CIn the interim period, prior to the outcome of the discussion paper process being known, you may be assured that there are no plans to announce any further changes to the spectrum allocations in relation to land mobile bands (as set out in Public Information Brochure 21). I will seek to confirm this through a statement of general policy of Government under section 112 of the Radiocommunications Act 1989.\u201D \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000424\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00229c0eba1d-17a6-44e2-a9b3-2e2535339570\u0022\u003EI think that might answer the questions of Pansy Wong and other colleagues about whether the Government has a secret agenda. This letter has gone to David Thomson and I am happy that the essence of the letter is in the House.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022 data-id=\u002297358a2485c14d3790c9071b9804666d\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000425\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002297358a2485c14d3790c9071b9804666d\u0022\u003EPANSY WONG (National): \u003C/span\u003EI raise a point of order, Mr Chairperson. The Minister is reading from a letter that is quite important to our deliberation, so I seek leave for the Minister to table it.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002270fa4cbd-9380-4916-9f2a-78da059d220e\u0022 data-id=\u0022a266fb08fb944ff7a4116f57b1d0ab4a\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000426\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002270fa4cbd-9380-4916-9f2a-78da059d220e\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022a266fb08fb944ff7a4116f57b1d0ab4a\u0022\u003EThe CHAIRPERSON (H V Ross Robertson)\u003C/span\u003E: You cannot seek leave for the Minister to do that. It is up to the Minister whether he wishes to do so. It is an official State document and you can request it, but you cannot seek leave for the Minister to do that.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00221a59d3ae-788b-4b19-b7dd-7d0e29a626fc\u0022 data-id=\u0022f68b34de28d640d08fcb92795c482a46\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000427\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221a59d3ae-788b-4b19-b7dd-7d0e29a626fc\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022f68b34de28d640d08fcb92795c482a46\u0022\u003EHon BRIAN DONNELLY (NZ First):\u003C/span\u003E This is probably a very appropriate time for New Zealand First to come into the debate, given that contribution by the Minister in the chair, Pete Hodgson, because it was New Zealand First that facilitated those meetings with the Minister. I can confirm that what the Minister was saying was absolutely correct, because I have a copy of the letter in front of me. It states that New Zealand First expressed its concern in the second reading with regard to this particular issue regarding the Radio Frequency Users Association of New Zealand and the radio mobile spectrum. We said at that time that we would be putting up a Supplementary Order Paper. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000428\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221a59d3ae-788b-4b19-b7dd-7d0e29a626fc\u0022\u003EI can say that as a result of the meetings that have been held with David Thompson, the Minister, representatives of the Radio Frequency Users Association of New Zealand, and members of the Ministry of Economic Development, matters have been resolved. David Thompson has been in communication with me and said that the association is more than happy now that the issues its members raised at the Commerce Committee\u2014which they considered had not been addressed appropriately through the select committee process\u2014have now been addressed, as a result of the work by New Zealand First. I asked the association what the problem was. I found it was that New Zealand First did not have a member on that select committee to pick up the genuine issues that were raised there, so somebody outside the select committee needed to pick up those issues and genuinely run with them. I guess the situation was like this. The association had gone through the normal processes, put up its submission to the select committee, and been ignored. Its members had been shunned, and there is some reference to that in the report back. But they came to New Zealand First, and asked whether we could help them to fix that. We said yes, we could, and we have done that. So what the Minister said is correct. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000429\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221a59d3ae-788b-4b19-b7dd-7d0e29a626fc\u0022\u003EThe issues that revolve around this particular matter are not unimportant issues. The part of the spectrum that we are talking about is the part that was captured by the Radiocommunications Act 1989. All the other users of that spectrum got their incumbency tenure, except for the users of the land radio mobile part of the spectrum. Since 1989, even though it is in the sixth schedule of that Act, nothing has been done about that matter. Whereas the owners of the other parts of the spectrum have been able to get investment in there because there is security and they are secure in their future use of it, this legislation was creating a high level of insecurity. And not only was that the case but the legislation was also creating what could have been seen to be an environment in which there was no value in providing any long-term investment and the actual users themselves felt under threat. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000430\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221a59d3ae-788b-4b19-b7dd-7d0e29a626fc\u0022\u003EI will quote from the Minister\u2019s letter, because I am sure he will not mind that, in order to give members some understanding of just how important this part of the spectrum is. He wrote: \u201CIt is acknowledged that the land mobile service provides essential services to both Government and private industry, as highlighted during the recent severe snow storms in southern Canterbury, where for a lengthy period such services provided the only reliable form of communications.\u201D It was that part of the spectrum that was under threat. National and ACT would probably say it should be sold to the highest bidder. New Zealand First has a much more responsible view of the whole thing; it believes that such things as social responsibilities have to be balanced against economic imperatives. New Zealand First, therefore, although we did not even have a member on the select committee that looked at this legislation, said that no, something had to be done about the issue. We facilitated the meetings, we achieved the necessary outcomes, and, as we say, we have once again fixed it. Thank you, Mr Chairman.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022 data-id=\u00229e12074eb3324632b83b77d6b31246f2\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000431\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00229e12074eb3324632b83b77d6b31246f2\u0022\u003EPANSY WONG (National):\u003C/span\u003E I raise a point of order, Mr Chairperson. Standing Order 368, \u201CQuoting documents\u201D, states: \u201CWhenever a Minister quotes from a document relating to public affairs a member may, on a point of order, require the Minister to lay the document on the Table. The Minister must then lay the document on the Table unless it is of a confidential nature.\u201D\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000432\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002270fa4cbd-9380-4916-9f2a-78da059d220e\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002244853260816446a5860eadd3a9a0c38a\u0022\u003EThe CHAIRPERSON (H V Ross Robertson)\u003C/span\u003E: Is the member requesting\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000433\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022608716951a564f2eb135013095056027\u0022\u003EPANSY WONG\u003C/span\u003E: I am seeking leave for that\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000434\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002270fa4cbd-9380-4916-9f2a-78da059d220e\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00223b22119eaae245d181c92595ec6e5996\u0022\u003EThe ASSISTANT SPEAKER (H V Ross Robertson)\u003C/span\u003E: No, the member cannot seek leave, but she can request that it be done.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000435\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022bb825208c053430f9fb9a3111d3d58db\u0022\u003EPANSY WONG\u003C/span\u003E: I can request it? OK.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00229c0eba1d-17a6-44e2-a9b3-2e2535339570\u0022 data-id=\u0022cbf58a6ab1854a30b1fb06f6f6e0000b\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000436\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00229c0eba1d-17a6-44e2-a9b3-2e2535339570\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022cbf58a6ab1854a30b1fb06f6f6e0000b\u0022\u003EHon PETE HODGSON (Minister of Health):\u003C/span\u003E I am very happy to put the document on the Table. It is already on the Table, and Pansy Wong has already seen it.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000437\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002270fa4cbd-9380-4916-9f2a-78da059d220e\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022c3cc64d1a77f4d4f98aedebcac6e04f0\u0022\u003EThe CHAIRPERSON (H V Ross Robertson)\u003C/span\u003E: Thank you.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022 data-id=\u0022f3a2d51af69d400e81a98feb213fcd06\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000438\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022f3a2d51af69d400e81a98feb213fcd06\u0022\u003ECHRIS AUCHINVOLE (National):\u003C/span\u003E I rise to speak to Part 2 of the Communications Legislation Bill. I will speak about the position advised by officials of imported Japanese cars that would interfere with radio frequency, in addition to other aspects of the bill. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000439\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003EThe introduction of the possibility of allocated radio frequencies resulted in a number of submissions. Mr Donnelly is quite correct that the Radio Frequency Users Association of New Zealand referred in its submission to the land mobile radio band, and I will be speaking to that point. It is not something that was ignored by the National Party members on the Commerce Committee. Some submitters, though, were concerned about the process to be used on the allocation of radio frequencies. I know that earlier speakers have already discussed this issue, but I intend to canvass it again, because I am not entirely sure that those who made submissions would be comfortable with what we have heard so far from the Minister. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000440\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003EWhy we have a Government controlling allocation other than by competitive tender is the question. We have already been asked whether this is simply a means by which the Crown can hike the costs, whether it is a tax by stealth, or whether it is an underhand way of charging further fees. The Minister has given us a peep of a letter, which is now tabled and which he says is now in general circulation\u2014well, he did not quite say that, but he said it was available\u2014and I look forward to seeing that letter so that, as a member of the select committee, I can have some sense that all is being done as it should be. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000441\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003EThat did raise a concern about the allocation being conducted in a less than transparent manner. It is unfortunate that we are now receiving ministerial letters after select committee hearings.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000442\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022659f6556-09a1-4ead-bc52-05cbdb4eaab8\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002200abbe3e2aaa49ce9f38f3647ac2fd15\u0022\u003ECraig Foss\u003C/span\u003E: Same old, same old.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000443\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002260e0d3de9aff42699a119e981f3e5d60\u0022\u003ECHRIS AUCHINVOLE\u003C/span\u003E: Same old, same old. If the allocation is to be made on a basis other than competitive tender, what will the criteria be? TelstraClear, in its submission to the bill, raised the same nervousness that has been commented on by those organisations referred to by my colleague Pansy Wong when it said that an allocation of radio licences by any means is a matter of concern to it. This is in section 116(1)(e), which is to be substituted by clause 30 of the bill. TelstraClear stated in its submission about the allocation of radio licences by any means: \u201CTelstraClear opposes clauses 30 and 32 of the bill, which provide that radio licences may be allocated by any means, not just by competitive tender or auction. They would like to make it clear that they are talking about the allocation of spectrum for commercial purposes, not areas like scientific research. The proposed amendment creates uncertainty over the allocation method and opens up the prospect of arbitrary and non-transparent allocation of radio licences.\u201D This is exactly the nub of the question that is now being discussed. \u201CProviding allocation by any means will result in a party seeking to obtain a radio licence not knowing what requirements must be met in order to obtain a radio licence. Allocation by competitive tender or auction promotes economic efficiency, as these methods ensure that parties that place the greatest value on licences obtain them. Providing for allocation by any means opens up the possibility of allocation on a political basis, favouring some parties at the expense of others.\u201D\u2014and we all know about that\u2014\u201CThis would be particularly problematic for those parts of the spectrum that are used by the service providers for telecommunications. TelstraClear accepts that its part of the radio spectrum may only have a limited number of users or have characteristics that mean that a non-financial method of allocation is appropriate. However, the Act should be clear about when these considerations should apply. TelstraClear submits that such considerations would not apply when there is competition for the spectrum when the spectrum has been determined to have a commercial purpose. In these circumstances, spectrum should only be allocated by competitive tender or auction.\u201D \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000444\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003EI could absorb the time of the Committee by speaking of other protestations and concerns expressed by submitters, but basically the bill is small and technical. It was interesting to listen to the officials\u2014and we did listen, I say to Mr Donnelly\u2014and to submitters. They went to great lengths to try to explain their very complex submissions and to make them more easily understandable, and we certainly had a good understanding of the submissions. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000445\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003ENational, of course, supports the bill\u2019s laudable aspects, but we continue to have some concerns. One of them relates to Japanese imports, which have a 76 to 90 megahertz frequency. They are incapable of reception above that, so the majority of FM stations in New Zealand are excluded. This imposes some difficulties in terms of civil defence\u2014and that was indicated by Mr Donnelly. In speaking to this issue, the officials mentioned that they sought to provide a reassurance that broadcasts in civil defence emergencies would be available on National Radio AM. Being a West Coast resident, I was able to advise them that we on the West Coast do not receive National Radio AM.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022263be082-dd01-4ef1-9c19-d546d0174793\u0022 data-id=\u002296791f43156e4d7fb2bc19e8ea172e95\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000446\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022263be082-dd01-4ef1-9c19-d546d0174793\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002296791f43156e4d7fb2bc19e8ea172e95\u0022\u003EHon MARK GOSCHE (Labour\u2014Maungakiekie):\u003C/span\u003E I move, That the question be now put.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022 data-id=\u00222d6aa4ce36c345ed82bbbbb6acad2f6f\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000447\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00222d6aa4ce36c345ed82bbbbb6acad2f6f\u0022\u003EPANSY WONG (National):\u003C/span\u003E Thank you for giving me the call, Mr Chairperson, because now that the Minister of Health has tabled the Hon David Cunliffe\u2019s response to the Radio Frequency Users Association, I would like to make further comments.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000448\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EFirst of all, I am just wondering why we did not bring the Reserve Bank Amendment Bill into this debate, because Part 2 of that bill talked about horse racing, and I think we are now talking a lot about horse-trading in debating Part 2 of the Communications Legislation Bill. I was looking forward to Barbara Stewart of New Zealand First taking a call on her Supplementary Order Paper that seeks clarification of security of tenure for the Radio Frequency Users Association. I now understand that that Supplementary Order Paper has been withdrawn.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000449\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EWhy I was particularly interested was that Mr Shane Jones, a Labour member on the Commerce Committee, went to great lengths at the select committee\u2014and my very hard-working colleague can back me up on this\u2014to try to resolve the longstanding uneasiness of the association. He actually went to discuss the matter with the Minister of Communications, Mr Cunliffe. We had to seek leave to delay the deliberations until Mr Shane Jones could come back to the select committee members and assure us that a secure path could be resolved. Well, after three attempts and a delay of about 3 weeks in our deliberation on the issue, he came back empty-handed, and we were left no clearer as to why. Well, I have bad news for Mr Shane Jones, the rising star of the Labour Party: his action, unfortunately, did not secure much and did not count for much with his Minister. I think he needs to learn to trade horses a little better. Maybe he should take a lesson from National\u2019s senior whip, Lindsay Tisch, who is better at horse-trading and knowing how to secure a guarantee.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000450\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EIt was interesting to find that the letter went further. The Minister stated in the letter that he understood that the association was seeking \u201Ca 5-year window after the announcement of changes to the use of a land mobile band, during which time mobile licensees could not be compelled to relinquish radio licences \u2026 Further, you want to be assured that licensees will have access to alternative spectrum, that the frequencies provided for replacement licences are suitable, and that there is consideration of compensation for the related conversion costs.\u201D I congratulate the association on very successful horse-trading through New Zealand First. But it does raise an issue. I think, in future, members on the Commerce Committee will certainly make sure that we do not easily accept any advice in good faith from the officials without every assurance that we will not be ambushed. We are actually happy with the outcome, but we are also disappointed that that clear assurance from the Minister could not have been communicated to us in the first place through the Labour member Shane Jones.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000451\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EIt is interesting: one never knows what one can discover in the Committee stage\u2014last-minute horse-trading could prove to be quite fruitful for the Radio Frequency Users Association. I want to refute what New Zealand First\u2019s Brian Donnelly was saying about the Commerce Committee members. We were of one mind in seeking the assurance, and we fought very strongly on behalf of the Radio Frequency Users Association.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000452\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EPart 2 agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000453\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u002290a6a3faab144db592b842e9450e8c82\u0022\u003EClauses 1 and 2\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022 data-id=\u0022e3ec21c173d841e3bea21cb90f948f52\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000454\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022e3ec21c173d841e3bea21cb90f948f52\u0022\u003EPANSY WONG (National):\u003C/span\u003E I am very pleased to take a call on the title and commencement clauses of the Communications Legislation Bill. Now that National members know there is an official letter, as a result of horse-trading, we can assure the Commerce Committee members that the very valid point raised by the Radio Frequency Users Association has been resolved. National members are pleased to continue to support this bill.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000455\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EWe are doing so well that I wonder whether Minister Maharey would like to take a call to give us further reassurance that the Government\u2019s move to introduce a new provision, in Part 2, to assign radio frequencies to entities through means other than a competitive process would not result in horse-trading in a very non-transparent way to bidders. It has been a very revealing Committee of the whole House process, because we have seen how the parliamentary transparency process can be slightly sabotaged by horse-trading between Ministers and the parties that prop up this Government. Although National members support the result, we do not endorse the process. The public should be even more alarmed after last week, when the Government, in indecent haste, passed the parliamentary expenditure validation legislation. Now we learn that horse-trading happened behind the scenes, even after the select committee process\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000456\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022d7424254482044fa984de3aedca6c09d\u0022\u003EHon Members\u003C/span\u003E: Pay the GST!\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000457\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022c22d52cdaa41424dbc51924301f7ccf5\u0022\u003EPANSY WONG\u003C/span\u003E: I seek leave to table the member\u2019s bill in the name of Dr Don Brash that would allow the National Party to pay the GST.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000458\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002270fa4cbd-9380-4916-9f2a-78da059d220e\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00224229335976eb49aa96192053f0074571\u0022\u003EThe CHAIRPERSON (H V Ross Robertson)\u003C/span\u003E: The member is perfectly entitled to do so, because interjections from the other side of the Chamber led to it. Leave has been sought to table the bill. Is there any objection to that course of action? There is.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000459\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022747379513ba04f59b7a203985fb31640\u0022\u003EPANSY WONG\u003C/span\u003E: That is telling, is it not? The Labour member sitting on the other side of the Chamber did nothing to contribute to the legislation that is before us. That lazy Labour member did not even take the trouble to read this legislation, but continued to interject to challenge National to pay the GST bill, then refused leave for me to table Dr Brash\u2019s bill so that we could do that. Well, I have bad news for Labour members: the public has a long memory. I am very happy to come back to this legislation, if Labour members take the trouble to get up on their lazy legs, take a call, and contribute intelligently to the debate about the legislation that is before the Committee.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000460\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EThe National Party supports this legislation, even though we are totally unhappy with the incompetence of the Labour Government. Part 1 amends the Telecommunications Act 2001, which was set up to finish the business within 5 years. But we are here to extend that period for a further 2 years, because of the inability of the incompetent Labour Government to finish the task of examining the 13 designated services, which the Hon Paul Swain said would take the Commerce Commission only 5 years to do. We have agreed that we will support this legislation. The last thing we want to do is create uncertainty in the telecommunications sector, which has been through enough because of this inefficient, incompetent Labour Government. For that reason we reluctantly agree to support the passage of this bill.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022 data-id=\u00225b00f7cd50834130a83147edf5c27c7b\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000461\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00225b00f7cd50834130a83147edf5c27c7b\u0022\u003ECHRIS TREMAIN (National\u2014Napier):\u003C/span\u003E I rise to speak to the title of the Communications Legislation Bill, and to thank the chairperson of the Commerce Committee, Katherine Rich. It is interesting to look at the membership list of the committee, and to see that young Charles Chauvel joined the committee on 3 August 2006. We are looking forward to Mr Chauvel taking a call and enlightening us with his knowledge of the Communications Legislation Bill.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000462\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EIn speaking to the title, I say that National supports the bill, which deals with matters that are both urgent and necessary in the telecommunications sector. The bill is aimed at avoiding unintended consequences in both the telecommunications and the radio communications industries. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000463\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EThere are a couple of key things about the bill that I will summarise. Firstly, the bill prevents the unplanned expiry of regulations on a narrow range of communications services. We can see that Part 1 addresses that issue, on the likes of local telephone number portability services, cellular telephone number portability, national roaming\u2014which I will touch on a little later on\u2014and co-location on cellular mobile transmission sites. The second thing the bill does is give legal certainty to allowing the full use of the radio spectrum, despite some listeners choosing to use inappropriate radio receivers such as band expanders, which I spoke on in an earlier speech.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000464\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EThe Communications Legislation Bill is an omnibus bill; it amends two Acts\u2014the Telecommunications Act 2001 and the Radiocommunications Act 1989. As the Hon David Cunliffe\u2014\u201CLord Cunliffe\u201D\u2014said in his first reading speech, the bill maintains a commercial environment of certainty and confidence for both telecommunications services and the use of the radio frequency spectrum.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000465\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003ESpeaking to the title, I will deal with Part 1 in terms of the Telecommunications Act 2001. Members will recall that Part 1 was debated 2 weeks ago. Under the Telecommunications Act we see the issue of the expiry of a number of licences. The bill aims to extend by 2 years\u2014to December 2008\u2014the regulation of 10 services originally regulated under the 2001 Act, and those are the services I referred to earlier that include the likes of local telephone number portability, cellular telephone number portability, and national roaming, etc. As I said, the regulation of those services is due to expire in December 2006, unless that regulation is extended by an Order in Council on the recommendation of the Minister, following an investigation by the Commerce Commission. At the moment the Finance and Expenditure Committee is dealing with the likes of the local loop unbundling issue under the Telecommunications Act. It is very important that those regulated services are clarified and in good order. The necessary investigations by the Commerce Commission are under way right now, but the final decision on those investigations will not be acted on until late December 2006.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000466\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003ESo the situation has arisen where we could extend the regulated period by a number of years under an Order in Council, but there is a time frame that would not be able to be reached. As a result, under this bill we have created legislation to allow it to happen earlier. That will allow certainty to telecommunication service providers and customers, which they need in this industry. The industry requires big investment dollars and it is very important that investors from overseas know there is security of services going forward. The bill therefore extends the regulation of 10 services through to 2008. We have certainty of tenure in that regard\u2014at least for 2 years.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000467\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EI would be interested to hear the Minister in the chair, the Hon Steve Maharey, clarify whether there will be an Order in Council to extend regulation beyond post-2008, and explain the Government\u2019s plans. He could say whether the matter will be left in the hands of the new Government of the day, which is likely to be a National Government.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000468\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EPart 2 deals largely with amendments to the Radiocommunications Act, and they are mostly technical in nature. Once again, they are critical for the efficient functioning of the regulatory environment for services that require use of the radio spectrum. Listeners will have heard much about the firming up of the regulatory environment in regard to the radio spectrum. We have talked in particular about the certification of licences and the ensuring of property rights around those licences. The present legislation provides for proposed new licences to be assessed against existing licences, to ensure that the new use is technically compatible. The Act requires a certificate to be provided by a suitably qualified and approved radio engineer, attesting to technical compatibility, prior to registration on the public register.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000469\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EWhat does all that mean? Put simply, it means that if we accommodate poor-quality receivers, we can limit the spectrum available for new licences, and lower the economic utilisation of the radio frequency spectrum as a whole. That was the point I made in referring to the issue that arose with two Christchurch radio stations, where CanWest took Niu FM to court, arguing that Niu FM had overtaken some of its frequency and it was unable to get its full listenership on board because listeners who had imported new Japanese radios were flicking between the two stations, albeit not through CanWest\u2019s fault. CanWest went to court to get a decision about whose fault it was. I quote from the decision by Justice Chisholm, in which he stated that he would not uphold CanWest\u2019s claim, since it was \u201Creasonable to assume that the certifying engineer at RSM might not have known about the problem.\u201D\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000470\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EThis legislation sorts that out. It says that receivers that do not receive properly will not be taken into account. The legislation will clearly initiate licences going forward, and provide security of property rights to radio spectrum owners.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000471\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EThat summarises the two key parts of the bill relating to the Radiocommunications Act and the Telecommunications Act. The legislation deals with matters that are both urgent and necessary in the sector. It will avoid unintended consequences and ensure some security of tenure in the next couple of years. I say in summary that, first, it will prevent the unplanned expiry of regulation on a narrow range of communication services\u2014and I have talked about co-location in that regard\u2014and, second, it will give legal certainty to allow the full use of the radio spectrum, despite some listeners choosing to use inappropriate radio receivers such as band expanders.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00221a59d3ae-788b-4b19-b7dd-7d0e29a626fc\u0022 data-id=\u00220ef28083e68b445cbde9aa7f55d47bf9\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000472\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221a59d3ae-788b-4b19-b7dd-7d0e29a626fc\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00220ef28083e68b445cbde9aa7f55d47bf9\u0022\u003EHon BRIAN DONNELLY (NZ First):\u003C/span\u003E I want to make a fairly brief contribution. First, I would like to respond to some of the things Pansy Wong said. I have to say to her that, in fact, her party can pay back the GST any time it wants. All it has to do is take out the cheque book, put in the correct figures, get the signatures and amounts on the paper, put \u201CTVNZ\u201D on the top of the cheque, and send it off\u2014and the bill would be paid. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000473\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221a59d3ae-788b-4b19-b7dd-7d0e29a626fc\u0022\u003ENew Zealand First had a bit of a conundrum with this legislation, because we supported Part 1 but had some difficulties with Part 2, which we have pointed out. In respect of Part 2, we alerted Parliament to the fact that we had concerns, and we alerted Parliament to what those concerns were during the second reading debate. We said we would put forward a Supplementary Order Paper on the second part, and we made it very clear to the Government that if the Supplementary Order Paper did not proceed, we would not be able to continue to support the second part of this split bill. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000474\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221a59d3ae-788b-4b19-b7dd-7d0e29a626fc\u0022\u003EAs it was, we were able to take our concerns to the Minister of Communications, David Cunliffe, and I believe there is a lesson here for some of the Opposition members, in learning how MMP actually operates. The Minister, instead of saying: \u201CNo, no, no\u2014that\u2019s all been sorted out by the select committee. No, there are no issues here\u2014I don\u2019t want to hear you.\u201D, actually sat down and listened. When he listened, he found there were genuine concerns. As a result, he was able to facilitate meetings with the groups concerned, and once again he was open-minded enough to say that there were some genuine issues involved, and that he would do what he could to respond to them. He did respond to them in such a way that it placated the concerns of the particular users group that had brought the concerns to New Zealand First, and we were able to proceed with this legislation with everybody feeling somewhat more secure about its outcomes than they did before. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000475\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221a59d3ae-788b-4b19-b7dd-7d0e29a626fc\u0022\u003EThat is MMP in operation. No one party has a mortgage on all the wisdom in this Parliament, but unless certain parties that have been in power in the past learn that lesson, they will in continue in the positions where they are, for a long, long time. I know about coalition, and I tell members here and now that when it comes to education, Wyatt Creech and I could teach many people here how MMP can operate, and operate constructively. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000476\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221a59d3ae-788b-4b19-b7dd-7d0e29a626fc\u0022\u003EThe problem that was pointed out by the Radio Frequency Users Association actually emanated from the Radiocommunications Act 1989, under which there were certain obligations for the Government to meet. The Government did meet those obligations when it came to cellular broadcasting, television, and cellular services, but it completely failed to meet them when it came to the land mobile radio spectrum. The question, therefore, has to be asked: who was in Government for 9 of those years since that time? In fact, the party that did not meet the obligations under that Act is the party now sitting on the Opposition benches. That needs to be recognised. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000477\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221a59d3ae-788b-4b19-b7dd-7d0e29a626fc\u0022\u003EAfter all that time\u2014from 1989 when the Act came in, and there has been a problem ever since\u2014what party was able to reconcile the issues and fix the problems? The answer is that New Zealand First was able to take up the cudgels of that vitally important group and the services it operates\u2014vitally important, particularly in emergencies\u2014and New Zealand First was able to say that something had to be done. We would use the power of our vote in this Parliament to be able, at least, to get some leverage with the Minister. Fortunately, we had a Minister who was prepared to listen, and we were able to move the thing forward in a constructive fashion. New Zealand First is very proud of what it has been able to achieve in terms of this legislation, and we will be very pleased to vote for it. \u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022c437bda8-4741-4ac5-89ab-b0818e1ab9fa\u0022 data-id=\u0022307b31a53a2640c8b2799a4101c12df4\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000478\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c437bda8-4741-4ac5-89ab-b0818e1ab9fa\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022307b31a53a2640c8b2799a4101c12df4\u0022\u003EDARREN HUGHES (Junior Whip\u2014Labour):\u003C/span\u003E I move, That the question be now put.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000479\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c437bda8-4741-4ac5-89ab-b0818e1ab9fa\u0022\u003EMotion agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000480\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c437bda8-4741-4ac5-89ab-b0818e1ab9fa\u0022\u003EClause 1 agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000481\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c437bda8-4741-4ac5-89ab-b0818e1ab9fa\u0022\u003EClause 2 agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000482\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c437bda8-4741-4ac5-89ab-b0818e1ab9fa\u0022\u003EThe Committee divided the bill into the Telecommunications Amendment Bill (No 2) and the Radiocommunications Amendment Bill (No 2), pursuant to Supplementary Order Paper 60.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000483\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c437bda8-4741-4ac5-89ab-b0818e1ab9fa\u0022\u003EBill to be reported without amendment presently.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000484\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c437bda8-4741-4ac5-89ab-b0818e1ab9fa\u0022\u003ESitting suspended from 6 p.m. to 7.30 p.m.\u003C/span\u003E\u003C/p\u003E\n    \u003C/div\u003E\n    \u003Cdiv class=\u0022HpsHansard\u0022\u003E\n      \u003Cp\u003E\u003Cspan class=\u0022HpsProceedingHeading\u0022\u003EBills\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000485\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022b9f74ec15f954f9e8b679bbff2e219ce\u0022\u003EInsolvency Law Reform Bill\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000486\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u0022763e955288a24280a322685e6ab901c2\u0022\u003EIn Committee\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000487\u0022\u003EDebate resumed from 12 October.\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000488\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u0022f1134613a783458099b29f793883ebbb\u0022\u003EPart 3  Dealing with bankrupt and bankrupt\u2019s property\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022 data-id=\u0022b7992b3407ed42cdb29e76ee6b00d8e5\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000489\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022b7992b3407ed42cdb29e76ee6b00d8e5\u0022\u003EPANSY WONG (National):\u003C/span\u003E Part 3 concentrates on the very detailed technical procedures of the duties and responsibilities of the assignee, and how the assignee will supervise where an organisation has gone into liquidation. Part 3 also lays out whom the preferential creditors are. I will concentrate on two aspects of those provisions. I know that the Minister in the chair, Lianne Dalziel, is well known for her willingness to answer queries and address issues, and I look forward to that. A lot of the people who raised the issue, who are actually unsecured creditors, rightly will be quite cynical about legislation that has so many detailed provisions about what an assignee can do, etc. Will the end result be beneficial? Is there anything left for the unsecured creditor after a bankruptcy? \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000490\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EI will share with members a very high-profile case, which is one of the many bankruptcies that happen in a year. This high-profile bankruptcy happened in Wellington to a restaurant called Kopi. What happened is quite interesting. The proprietors owed the Inland Revenue Department $1.2 million in unpaid PAYE and income tax, and also related penalties and interest. The Dominion Post article on this high-profile bankruptcy included an interview with an unsecured creditor, a Richard Young of Molesworth Fruit Supply. He wrote off $28,000 that was owed by the restaurant proprietor, and he reckoned that his chances of winning first division Lotto are higher than getting his money back. I am sure that Richard Young\u2019s statement would be echoed quite frequently by unsecured creditors. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000491\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EI think maybe the Minister might like to take a call to say that we have gone through all the deliberation stages, and whether there was anything that she felt has been seen as a significant improvement to the legislation whereby the assignee would be better able to look after the interests of unsecured creditors. They are not the only ones who mentioned that winning first division Lotto would be easier than getting any residual money from a bankruptcy. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000492\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EThe other issue I want to return to is the $1.2 million owed by the couple to the Inland Revenue Department in unpaid PAYE, income tax, and penalties. The bankruptcy record shows that the liquidators were appointed on 20 February 2005, but apparently the proprietors stopped paying PAYE deductions from their employees\u2019 pay packets in 1998. They had stopped payment for 3 years. Then, in the tax years ended March 2002 and 2003, they paid only a fraction of their personal income tax, and one of them paid nothing at all in 2002. We all know that failing to pay PAYE is an offence, as is the persistent non-payment of personal tax. I wonder why the Inland Revenue Department had not instigated any action against this couple for the non-payment of taxes for 3 years from 1998. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000493\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EPart 3 continues to protect the Inland Revenue Department\u2019s secured preferential creditor status, and I think the Minister might like to take a call and say why an entity such as the Inland Revenue Department is so lax in terms of compliance action. We are being asked today, in this Committee of the whole House, to approve this part that includes a provision to continue to protect the Inland Revenue Department\u2019s position as a secured creditor. I emphasise that this is not a single example. A powerful department like the Inland Revenue Department has all the tools at its disposal. If it had taken action to liquidate the company earlier, it might be that the unsecured creditors and other creditors would have benefited from it. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000494\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EThat is not an isolated case. Let me share another case with the public. I am sure that my very good, hard-working colleague from the West Coast, Chris Auchinvole, would join me in citing this case. This is a company on the West Coast that went into liquidation. During the hearing in the High Court at Greymouth, the very, very good mining town, Justice Christiansen described the Inland Revenue Department as lurking in the background like a shark, waiting to consume failing companies. Why did he say that? He said that because this was an attempt by the department to liquidate a possum skin company, called Gray Fur Trading. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000495\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EJustice Christiansen said that the company owed almost $200,000 in overdue income tax and GST. That is fair enough. But the court was told that almost half of that amount, $100,000, was added on in penalties. The initial debt was closer to $90,000, but it had ballooned since 2003, and the department did not take any action or correspond with that company until October 2004. A powerful Government department did not take action that could have benefited unsecured creditors, and then, on the initial debt of $90,000, it charged $110,000 more to liquidate the company. In the event, nobody benefited. We on this side of the Chamber need to be convinced why the department\u2019s preferential creditor status needs to continue to be protected. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000496\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EThen, of course, recently the department released a discussion document and said it was going to waive some penalty tax. If a company can prove that it has taken reasonable steps to address or reassess its tax position, the department might be a bit lenient in terms of the penalty test. I do not think it is good enough. I think the fact that National members on the Commerce Committee put up a very strong case for questioning the department\u2019s continued protected preferential creditor status has somehow led the department now to issue a discussion document about being a bit lenient on certain penalties incurred by those companies. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000497\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EThose two very high-profile examples are not untypical. In fact, they are quite representative of the position, because liquidators, the people involved in the insolvency petitions, have come before our committee and said that lots of times they have felt for the unsecured creditor. They said that the position of companies was aggravated largely because, for example, the department failed to take early action or, alternatively, the department\u2019s preferential creditor position has made sure that it does not take very quick action to recover some of those payments, which do not even belong to the department or to the company because the company is simply a collecting agent.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022 data-id=\u0022c60a3889b16847bb9be6a3be30855188\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000498\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022c60a3889b16847bb9be6a3be30855188\u0022\u003ECHRISTOPHER FINLAYSON (National):\u003C/span\u003E Part 3 is made up of 10 subparts, but really does not contain a great deal that is new to the Insolvency Act 1967, which this bill is designed to replace. If one looks at the various clauses of all 10 subparts, one finds that most of those clauses simply re-establish the position that was quite clear under the Insolvency Act. So there is not a great deal that I really want to say about this part, and I will just make a couple of brief comments about some of the newer provisions. The first concerns clauses 117 to 121, which provide for various provisions relating to disclaimers of onerous property. I will just pause on those for a couple of minutes and explain what onerous property is about. When an official assignee takes over the affairs of a bankrupt, he or she may make a decision to disclaim onerous property. In other words, the assignee may decide not to take certain steps in relation to an unprofitable contract or in relation to the property of a bankrupt that is unsaleable, if to take on those obligations would create a burden on the official assignee that would be regarded as onerous. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000499\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003EThose provisions are brought across from certain provisions of the Companies Act 1993, particularly sections 269 and 270 about the power to disclaim onerous property. There are a couple of minor changes to clause 117(4). In particular, the definition of onerous property can include: \u201Ca litigation right that, in the opinion of the Assignee, has no reasonable prospect of success or cannot reasonably be funded from the assets of the bankrupt\u2019s estate;\u201D. All that means is that if the bankrupt was party to litigation in which he or she was seeking damages, or a declaration, or whatever, the official assignee could decide that the proceeding did not have a reasonable prospect of success so there was no real point in taking it over. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000500\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003EThat is really the only thing I want to say about the first subpart of Part 3. I think the provisions are brought together reasonably well, although, for the reasons that my colleagues have advanced, because of major flaws that we see in other parts, we will not be supporting the bill. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000501\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003ESubpart 2 sets out the duties of the bankrupt, and, as I say, largely re-enacts what is already in the Insolvency Act 1967. Subpart 3 outlines, importantly, those provisions that deal with control over the bankrupt during a bankruptcy. There are very real limitations on what the bankrupt can do, once he or she becomes bankrupt, and those provisions include, if necessary, prohibiting the bankrupt from entering or continuing on in business, and seizing the bankrupt\u2019s property\u2014indeed, the bankrupt must vacate land or buildings if required to do so. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000502\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003ESubpart 4 deals with the provision for the bankrupt during bankruptcy. Obviously, the fact that a person is bankrupt does not necessarily mean he or she shall be reduced to being a beggar; the bankrupt may retain certain assets, within reason. That is all dealt with perfectly rationally in that subpart. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000503\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003ESubpart 5\u2014again, nothing new here\u2014deals with the powers of the assignee and the court to examine the bankrupt and others. Clause 182 brings across a provision relating to the privilege against self-incrimination that states: \u201CA person is not excused from answering a question because the question may incriminate or tend to incriminate that person.\u201D Subpart 6 is a very important subpart that deals with the status of a bankrupt\u2019s contracts. It re-enacts those provisions reasonably clearly, explaining what exactly can happen to contracts that may have been entered into by the bankrupt. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000504\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003ESubpart 7, \u201CIrregular transactions before adjudication\u201D, contains one or two new provisions, and the only area I want to pay any attention to is clauses 202 and 203, which deal with insolvent gifts. If a bankrupt gifts something to another person, that gift may be cancelled on the assignee\u2019s initiative if the bankrupt made the gift within the 5 years immediately before adjudication and the bankrupt was unable to pay his or her debts immediately after making the gifts. Those are important provisions designed to get around the prospect of gifting in order to avoid the consequences of bankruptcy. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000505\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003EThat is really all I wanted to say. Perhaps I should just briefly say that subpart 8 sets out the very great powers of the assignee once he or she assumes responsibility for the property of a bankrupt. Subpart 9 simply deals with creditors\u2019 claims. I think there is virtually nothing new there; some provisions are brought across from equivalent sections in the Companies Act 1993. Finally, perhaps I should refer to subpart 10 of Part 3, which deals with the powers of the court. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000506\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003E So, really, there is nothing very important in this part that has not been brought across either from the Insolvency Act 1967 or the Companies Act 1993. It is all fairly routine stuff. As I said earlier, we have major issues of principle with Part 5 and Part 8\u2014which seeks to deal with the new concept of voluntary administration\u2014for reasons that will be developed when we deal with those parts. That is why we are opposing the bill. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000507\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003EThe question was put that the amendments set out on Supplementary Order Paper 62 in the name of the Hon Lianne Dalziel to Part 3 be agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000508\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003EAmendments agreed to.\u003C/span\u003E\u003C/p\u003E\u003Ca id=\u002297b65b8d8f384f1585a8c7fcf9fcad01\u0022 name=\u0022division\u0022\u003E\u003C/a\u003E\u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EA party vote was called for on the question, That Part 3 as amended be agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EAyes 71\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand Labour 50; New Zealand First 7; Green Party 6; M\u0101ori Party 4; United Future 3; Progressive 1.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENoes 48\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand National 48.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EPart 3 as amended agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000509\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u0022e82e11000d414d029d94dd8a79bd97f8\u0022\u003EPart 4 agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000510\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u00229b45202df1f44749944c3ccea85c79e5\u0022\u003EPart 5  Compositions, proposals, summary instalment orders, and no asset procedure\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022 data-id=\u00224a6852c56af84374ade7e4d5c8960412\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000511\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00224a6852c56af84374ade7e4d5c8960412\u0022\u003EPANSY WONG (National):\u003C/span\u003E Part 5 is quite a substantial part, so we will take quite a few calls. I will start off by raising the concerns of the National Party, which does not support Part 5. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000512\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EOne of the major issues of concern to us is the introduction of a provision called the no-asset procedure. We were told by the officials that the reason for introducing the no-asset register is to allow a person who has no previous bankruptcy experience and no assets etc. to simply enter into the register for a period of 12 months, and at the end of that period to be discharged of his or her debts. The debt can range up to $40,000. They claimed that that was proposed for two reasons. First, nothing positive is achieved by placing people who have no income or assets into bankruptcy, and it does not help the creditors to get their money back. Secondly, it will reduce administration costs. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000513\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EWe certainly have a problem with the concept that if a person who has incurred a debt agrees to enter into the no-asset register, the creditor will end up with nothing. The indebted person has no obligation to try to repay his or her debt. I can just see that a lot of students will be eligible. In fact, my very hard-working, intelligent colleague Chris Tremain, as soon as he heard about this provision, said that it could become known as the student loan write-off provision. When one thinks about it, one realises that tertiary students are very well qualified under this provision. First of all, they are encouraged to incur debt, because there is no interest on it. Then they are encouraged to enter into the no-asset register, because if they enter themselves in the register, after 12 months their debts will be written off. Presumably, if it is good enough for the Government to write off debts owed to businesses, it will be good enough for the Government to apply the same principle to itself. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000514\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EBut the concern about that concept is that it undermines, once again, personal responsibility. I believe that a person who incurs a debt incurs an obligation to pay that debt. The fact that the Government endorses the concept that a person can incur debt of up to $40,000, enter on to a register for 12 months, say \u201CThat\u2019s it; it\u2019s a clean slate.\u201D, and start from the beginning is certainly not a good thing. We were told that some retailers endorse that, but I am not sure that all retailers would like that measure. Some retailers\u2014maybe those of a smaller size\u2014may find it more difficult to do business once they get a credit assessment of certain individuals, decide to extend credit to them, then find themselves at the stage where those individuals may not have to repay their debt. We certainly find that the Government should not send the message to individuals that it is OK to incur debts because they could, at the end of the process, have no obligation to repay them. There are a lot of small businesses in New Zealand; we all know that small to medium-sized businesses make up 92 percent of businesses in New Zealand. In fact, for a lot of them their annual profit may only come to about $30,000 to $40,000, and to write off a significant debt is certainly not of comfort to our small businesses. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000515\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EWe are flabbergasted that the no-asset procedure is being introduced. \u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022c186d0a2-99f4-408b-9b4d-d484cf19724d\u0022 data-id=\u002252c6672cc93f4444a933c3c9c190a6cd\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000516\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c186d0a2-99f4-408b-9b4d-d484cf19724d\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002252c6672cc93f4444a933c3c9c190a6cd\u0022\u003EHon LIANNE DALZIEL (Minister of Commerce):\u003C/span\u003E I will respond to a couple of points that Pansy Wong has made. She has referred to students. Because students will not be adjudged bankrupt because of non-payment of their student debts, it has been decided student debt should not be provable or dischargeable within the no-asset procedure. Therefore, it is not an issue as the member has indicated. I think the member should refer to the fact that summary instalment orders are now being made far more accessible, in terms of the cap being raised from $12,000 to $40,000 total unsecured debt, and I think a lot more individuals will take the summary instalment order option rather than go to the no-asset procedure.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000517\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c186d0a2-99f4-408b-9b4d-d484cf19724d\u0022\u003EI am interested that the National Party opposes an alternative to bankruptcy for individuals with minimal debt and few assets who have no means to repay the debt. This measure acknowledges that individuals cannot avoid bankruptcy, and that the punitive, deterrent element is disproportionate and totally irrelevant to these individuals. It gives debtors a fresh start, it provides safeguards against abuse of the procedure, and it minimises the cost to the State. I think this is a win-win.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000518\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c186d0a2-99f4-408b-9b4d-d484cf19724d\u0022\u003EThe other point the member has made that I think does not stand up to any scrutiny is that this will encourage those who offer credit to people who cannot afford to pay back the amount of credit they have been offered. It will make them think twice. They will have to think very carefully about extending a person\u2019s credit card limit without a request even having come from the individual. Pansy Wong does not have constituents so she does not understand this. But I have constituents who come into my office and show me letters from their banks stating that their credit card limit has been extended, without an application having come from the individual. I do not think it is right and proper that we have people offering credit left, right, and centre without any realistic prospect that people will be able to pay it. I think this will make creditors a lot more careful about offering credit to people who cannot afford to pay.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022 data-id=\u002231a7a77a473742819725ab019bcc8cc7\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000519\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002231a7a77a473742819725ab019bcc8cc7\u0022\u003EKATHERINE RICH (National):\u003C/span\u003E The points made by the Minister Lianne Dalziel are very interesting but they are quite wrong. I will start by taking issue with her phrase that a \u201Cfresh start\u201D is being offered people who become bankrupt. That is nothing more than a euphemism, because quite often a number of Kiwis rack up debts through recklessly taking out loans even though they have no ability to repay them. This Government is saying it is OK to write off 40 grand of debt.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000520\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022\u003EThe second point\u2014and I think it shows a difference between National and Labour\u2014is that the Minister is indicating a total disregard for business. Ninety-five percent of New Zealand businesses are small businesses, many of them are mum and dad operations, and some of them in good faith sell products to people who, on the surface, look like they can pay for them and have a good credit history. These are the operators and business people who will be in the gun for selling products to people who cannot repay them\u2014up to $40,000. I do not think that is fair. I think allowing someone to recklessly rack up debts then be let off the hook to the tune of $40,000 shows a total disregard for what it is like to be in business, to carry risk, and to lie awake at night worrying about whether the bills can be paid. That is a serious sum if one is a plumber, or runs the local dairy, or runs the local furniture shop.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000521\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022\u003EThe final point where I think the Minister has it quite wrong is the little barbed comment she made about Pansy Wong doing no constituency work. That member looks after most of the Asian community from Kait\u0101ia to Bluff, and deals with a wide range of issues\u2014from immigration, to welfare, to business\u2014and it is kind of smug and insulting to say she does not do that kind of work.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000522\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022\u003EThis bill was probably at least worth putting on the agenda, because personal bankruptcy laws have not been looked at since the early 1960s. We saw that some work done in the 1960s culminated in the Insolvency Act of 1967, but there has not really been a good look at it since that time. The number of bankruptcies we see in this country has changed dramatically. In the 1980s there were about 800 personal bankruptcies, and we have seen that increase dramatically to about 3,000 per year\u2014that was the 2005 figure, but it is probably more now. The type of bankruptcy we are seeing has also changed. It used to be bankruptcy as a result of a small business falling over; today many bankruptcies are the result of people racking up too much debt on the credit card.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000523\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022\u003EThe no-asset procedure aims to deal with people who have no money, no assets, and no prospect of paying a debt off. It might seem a cute, tidy way of dealing with those people, but members on this side of the Chamber are worried about the messages it sends to other New Zealanders\u2014that it is OK for people not to be responsible for the debts they incur, that it is OK for people to take out goods on hire purchase with no prospect of paying for them, that it is OK for people not to deal with issues of personal responsibility, because the Government will let them off for up to $40,000.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000524\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022\u003E That is a serious amount of money for most New Zealanders. I feel for some of the creditors who have sold products to these people, because there is no prospect of their getting back any of the money. The Minister Lianne Dalziel might say: \u201COh well, it will make those businesses think twice.\u201D, but I think that indicates a total lack of interest in the day-to-day workings of small businesses, and a lack of realisation of what it is like to have a customer standing opposite who wants to buy a lounge suite, and who looks like he or she stacks up, but who, when things turn to custard, cannot pay his or her bill. Most small-business operators have children. They want to put bread and butter on the family table just like anybody else. This Government is giving up on these debtors. It is forgiving debts of up to $40,000. It is basically setting up a training programme for people to move on to the big game of proper bankruptcy, after they have had their first warning by entering this 12-month no-asset procedure.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000525\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022\u003ELuckily, the Commerce Committee did tighten up a few things. The committee members felt that there were no penalties for people who give misinformation or do not keep their part of the bargain. At least that change was made, even though we were concerned about some other aspects. But I think, ultimately, Part 5 is really about what message we are sending to Kiwis. We are saying it is OK for them to incur debts of up to $40,000. They will be forgiven that, they will be told it is OK, and they can have another go.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022 data-id=\u00226e3654a1a1b7434399e9e5aee26967ce\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000526\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00226e3654a1a1b7434399e9e5aee26967ce\u0022\u003ECHRIS TREMAIN (National\u2014Napier):\u003C/span\u003E I rise to speak to Part 5 of the Insolvency Law Reform Bill and to the different means within this bill that can be put forward to deal with people\u2014companies in a range of different corporate and individual structures\u2014who get themselves into the position of being unable to pay their bills. I must say that over the course of the last 15 years I have had some personal experience with a number of individuals and companies that have, unfortunately, got themselves into that position. They have got into a situation where they have owed my own business money, and we have been faced with having to deal with their bankruptcy and trying to recover money from either an individual or a company we have put our trust in and have done business with over a period of many years\u2014in some cases, for decades. In one instance, in one of our travel businesses, we had dealt with the person concerned for decades. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000527\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EIt is a very difficult situation when one of the businesses in a relationship like that goes into bankruptcy. I can assure members that not all companies deal with bankruptcy in a draconian way and look to bedevil the poor guy who has got himself into that situation. In fact, many companies look for alternative ways to help those people, because bankruptcy, as we know, is not just about the financial impact of that situation on people but also about the mental and psychological impact on them, on their family, on their friends, and on their wh\u0101nau. I think one does need to take that into account. There are those who go bankrupt and break the law in doing that\u2014they actually go out of their way to put themselves into a difficult position. But I am talking about guys who have been in business for a long time and who, through no fault of their own, get themselves into a difficult situation. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000528\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EOne example we were involved with concerned a building company that put up the AMP building in Napier. Because the head contractor for that building project had gone bankrupt, Linnell Building and Joinery in Hastings unfortunately got itself into a position where its head contractor did not pay the bills. It was such a major contract that that company then got itself into a situation where it turned bankrupt. Really, Linnell Building and Joinery had done nothing wrong, but it found itself in a difficult situation with many companies in Hastings, including my own at that point\u2014I think we had just sold a property for that individual, and he could not pay the commission. In that case, we sat down and used the proposals situation referred to in Part 5 of this bill to help the company out. I am pleased to say that the firm is now back on its feet again and is one of the best building companies in Hastings, not only in residential joinery but also in a whole range of building products. That firm does homes and commercial properties, and it is back on its feet again. I think it was helped by the proposals situation and by everyone getting on board on that. The company also does a lot of work in my own constituency of Napier, which is good to see. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000529\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EPart 5 deals with four different types of procedure that can be undertaken in a bankruptcy situation. I will make a few comments about each. The first is composition. In that situation creditors put forward a resolution to help the individual person or company out. That, in many cases, works well. Often creditors accept a lesser amount than is due to them. That can help people to get out of difficulty, as was the case with my friends in Hawke\u2019s Bay in their particular situation. The very few changes made to Part 5 in the Commerce Committee were small ones. The second procedure is proposals. That is the situation where, instead of the creditors putting forward a solution, the bankrupt company is able to put forward its own proposal for getting itself out of that situation. Another situation with which I was involved in the Napier electorate concerned a business called Linden Estate Winery and Vineyard, a company that got itself into a difficult situation and overcommitted itself by taking on a number of vineyard leases.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022136da8c4-afc7-483e-a39c-c66812f71774\u0022 data-id=\u0022f874af628ef74d848b23d1f39374e670\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000530\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022136da8c4-afc7-483e-a39c-c66812f71774\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022f874af628ef74d848b23d1f39374e670\u0022\u003EKATE WILKINSON (National):\u003C/span\u003E In rising to speak to Part 5 of the Insolvency Law Reform Bill, I point out that it is in four subparts\u2014as we know.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000531\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022136da8c4-afc7-483e-a39c-c66812f71774\u0022\u003EThe first three subparts are mostly relatively straightforward machinery-type provisions with which I do not have any issue. Subpart 1, as Mr Tremain stated, deals with composition during bankruptcy, the passing of resolutions, the fact that compositions must be approved by the court, the procedure for court approval, the deed of composition, etc. Subpart 2 deals with the proposals. It includes a definition of \u201Cdebt\u201D, and the allowance for an insolvent to make a proposal, whether that be by way of a compromise, a time payment, assignment, or other. Again, that proposal must be filed in, and approved by, the court. The subpart continues with the various duties of the insolvent and the trustee. Subpart 3 deals with the summary instalment orders, and includes the time payment, who can apply for an order, the supervising of such an order, the role of the supervisor, and rules for summary instalment orders. National does not take too much issue with most of those provisions.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000532\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022136da8c4-afc7-483e-a39c-c66812f71774\u0022\u003EThe provision that causes us the most angst, as National members have already mentioned, is subpart 4, relating to the no-asset procedure. It sounds good in practice. An individual can choose to enter into the scheme for 12 months in return for a write-off of up to $40,000\u2014unfortunately, at the expense of creditors. Although this may have some practical advantages, it sends a very clear message that individual responsibility is not important. Basically, it says that people can do what they like and take no responsibility because, never mind, someone else will pay for their mistakes.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000533\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022136da8c4-afc7-483e-a39c-c66812f71774\u0022\u003EWe all know that insolvency laws should always provide a balance. They do by their very nature allow for mistakes, but they should also require responsibility to be taken for those mistakes so that debtors can learn from them, get over them, then start again; it should not be that the mistakes can just be swept under the carpet and 12 months later the debtor can start again. But it seems that under subpart 4 of Part 5 there are no such words as \u201Cmistake\u201D and \u201Cresponsibility\u201D. It is a bit like pretending that failure does not exist, when we all know that it does.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000534\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022136da8c4-afc7-483e-a39c-c66812f71774\u0022\u003E Insolvency laws should balance the responsibility for failure and the opportunity to start again. But they should also never forget the creditors, who are not always the Inland Revenue Department and who are not always the Government. It could be the creditors who stand to lose. This measure punishes the small-business owners\u2014the self-employed\u2014who are owed this money. It makes it too easy for the debtor to give up rather than try to trade through those difficulties. The debtor can give up and in 12 months\u2019 time just start again, and the poor small-business owner, the self-employed creditor, has no recourse whatsoever.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000535\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022136da8c4-afc7-483e-a39c-c66812f71774\u0022\u003EThe criteria for the no-asset procedure as set out in clause 359 are not particularly complicated. The assignee must be satisfied on reasonable grounds that the debtor has no realisable assets; the debtor has not previously been admitted to the no-asset procedure, so this is one strike and you are out; the debtor has not previously been adjudicated bankrupt; the total debts are between $1,000 and $40,000; and, under a prescribed means test, the debtor does not have the means of repaying any amount towards those debts.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000536\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022136da8c4-afc7-483e-a39c-c66812f71774\u0022\u003EThroughout the no-asset procedure the debtor must not obtain any further credit\u2014which seems to make sense\u2014including hire purchase, whether it is jointly or by himself or herself. But it does not seem actually to describe what the debtor can do in that 12-month period. Does the debtor just sit on his seat and do nothing? Can the debtor actually continue with employment? Can the debtor, if jointly in business with, say, his or her spouse, continue that business with the assignee\u2019s consent? This part of the bill does seem to be a wee bit silent as to what the debtor can actually do during that 12-month no-asset period.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022 data-id=\u0022c57f3c83d8cb4a488388621306021069\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000537\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022c57f3c83d8cb4a488388621306021069\u0022\u003ECHRIS AUCHINVOLE (National):\u003C/span\u003E I rise to speak to Part 5 of the Insolvency Law Reform Bill. National members are opposed to the bill, which in some ways I think is unfortunate, because we feel it could have been quite good in so many aspects. But, as in so many aspects of the term of office of the current Government, it has failed to come up with the momentum necessary to carry through the better parts of the bill. In Part 5 there is, again, the feature of the Government not being able to carry through the original intention of this borrowed legislation. I say \u201Cborrowed\u201D because in its original form it came from Australia. In its original form it concentrated heavily on improving the situation of bankruptcies, on helping debtors to recover their situation, and in all aspects was quite a solid piece of legislation. But it has been chopped and changed to suit, I would suggest, the social agenda of this particular Government.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000538\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003EThe problem of major proportions that we have here is the no-asset procedure. Why on earth is the Government even entertaining such a move? There seems to be some suggestion that this is State-assisted debt avoidance. Subclause (2) of clause 367 states: \u201CThe debtor must notify the Assignee as soon as practicable of any change in the debtor\u2019s circumstances that would allow the debtor to repay an amount towards the debts referred to in section 366(1).\u201D I cannot find in any parts or subparts of the bill the compulsion that goes with this requirement.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000539\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003EI do not think it is quite right for the Minister who was previously in the chair, the Hon Lianne Dalziel, to blame outright the creditor for the person being in debt, as she did earlier. Sure, I share the Government\u2019s concern that there is an easy extension of credit to people, which, for the poorly organised, could entice them towards debt. But by the same token here it is providing an opportunity for people to walk away from the responsibility they willingly undertook. I also think it is a bit rich that on the one hand the Government extends credit to students through the student loan scheme but then denies them entry on to the register. They cannot get off without paying the Government back\u2014oh no! \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000540\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022d657ccb58653488ca1fb8e36150d6434\u0022\u003EPansy Wong\u003C/span\u003E: Double standards.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000541\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00229bcff61dc22a4bbe86d9e150e7c8e460\u0022\u003ECHRIS AUCHINVOLE\u003C/span\u003E: But small businesses will have the debtors strolling off from the debt through this particular clause. As my colleague and mentor in many ways, Pansy Wong, says, there are double standards operating here. In other words, the Government is not prepared to extend the same level of protection to retailers that it extends to itself, but, by gosh, it will put them at risk in a way that it is not prepared to put itself at risk.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000542\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b4f92f44f8864c1382120a1b6f3e9828\u0022\u003EPansy Wong\u003C/span\u003E: It does not care about retailers.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000543\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022300e5e8b97d247a6b607d08c7c2a676c\u0022\u003ECHRIS AUCHINVOLE\u003C/span\u003E: It does not care about retailers. Small business in New Zealand, though, is New Zealand\u2019s major business and there are plenty of statistics to emphasise that. To allow a shrug of the shoulders towards personal debt is an odd thing for any Government to do, but particularly this one. We understand\u2014and I am not an economist and I do not pretend to be one\u2014that the present level of household debt is higher than ever before in this country\u2019s economic history.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000544\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ac7d4b1084a9480ca8bb3b9708b5df43\u0022\u003EPansy Wong\u003C/span\u003E: Why?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000545\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00221d71d491f2c342e6849ff571ba0db80a\u0022\u003ECHRIS AUCHINVOLE\u003C/span\u003E: I do not know. Why is it? Does this legislation help?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000546\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002211d6a3b685c143ac9a611b5283693bd7\u0022\u003EPansy Wong\u003C/span\u003E: No personal responsibility.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000547\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00228754693332bf44519f12cc0580ec08c0\u0022\u003ECHRIS AUCHINVOLE\u003C/span\u003E: Looking at the lack of personal responsibility is a good start when addressing why.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000548\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002207dc4112-8a19-4dd6-a57c-878b47f8a9b6\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022a513eb37f8af4878bdf02707c41797b6\u0022\u003ERon Mark\u003C/span\u003E: Credit cards and hire purchase.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000549\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002273ea9793473d4fb18480df0bc992a3f5\u0022\u003ECHRIS AUCHINVOLE\u003C/span\u003E: Credit cards and hire purchase\u2014access to easily available credit. A constituent came to see me the other day in my little blue office in Greymouth. He explained just how easy it is to get credit nowadays. He said that all people have to do is keep refusing to take it from the companies that keep offering it, and they offer them more, and they offer to make it easier. He did not have a problem with that. What he did have a problem with was a weak-willed relative who took advantage of those opportunities then sought, exactly as we are saying here, to walk away from the responsibilities. That is the danger that is faced here. I notice that Mr Mark of New Zealand First is agreeing with that, and I am delighted to think we have reached one point of agreement in our mutual interest.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000550\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003EWe understand that the level of household debt is higher than ever before. Is the Government blind to the reality of this? It has been quick enough to crow repeatedly about how the Government\u2019s debts\u2014and I have heard Dr Cullen give a speech on this particular subject\u2014have been cleared and reduced, almost as if the taxpayer had not actually contributed to that being possible.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022eaf79431-1033-44f1-a633-22633da52c0d\u0022 data-id=\u00220bccc202ad39431cbc2eff139d15292c\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000551\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022eaf79431-1033-44f1-a633-22633da52c0d\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00220bccc202ad39431cbc2eff139d15292c\u0022\u003EDAVID BENNETT (National\u2014Hamilton East):\u003C/span\u003E As we have been talking about Part 5 of the Insolvency Law Reform Bill, the National Party does have some major concerns about the no-asset procedure. I think it is important that, as a country, we look at the time of year we are entering. The next couple of months is a very important time for New Zealanders and their families as we come into Christmas. Just on Monday we had Labour Day, and there were a number of sales in Hamilton for example. Major discounts were offered on appliances and other household goods. Consumers were lining up to buy such goods, and they will line up over the next couple of months because they have families they have to buy Christmas presents for. They will increase their household debt to huge levels over the next couple of months. What will happen at the end of that time? People will have to make some payback in the early New Year. That is when the hampers come to fruition. That is when people pay for their families to go away on holidays. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000552\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022eaf79431-1033-44f1-a633-22633da52c0d\u0022\u003EAnd what are we doing as a Parliament in this country? We are setting up an institution that encourages greater debt, that tells people not to worry about it and that after Christmas they can write it off. Why would we be putting that message out? Well, I guess it is the lesson we learnt last week, is it not? If it is good enough for this Government to take that attitude, it certainly signals that it is good enough for New Zealanders to have the same attitude. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000553\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022eaf79431-1033-44f1-a633-22633da52c0d\u0022\u003ELet us look at some of the reasoning behind the legislation. When it was first put together by the Minister of Commerce, it was disclosed: \u201CThe Bill proposes a NAP be introduced as an alternative to personal bankruptcy, which is less punitive to individuals and may prove to have less social stigma attached to it. This would apply to first time debtors who have no assets and could not repay the debt. The proposal to introduce a NAP is the most significant change that the bill proposes in the area of personal bankruptcy.\u201D Well, certainly that is what the Minister was intending to bring about through this legislation. It has also been said in a press release from the Minister: \u201CThe No Asset Procedure is a one-off opportunity for an individual with no assets to be subject to the procedure for 12 months as opposed to 3 years as in cases of personal bankruptcy.\u201D\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000554\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022eaf79431-1033-44f1-a633-22633da52c0d\u0022\u003E Well, those may be fine, ideological things to put forward in a bill, but they deny the reality that there is another side to any credit engagement, and that is the institution that sells the product. In New Zealand that is generally a small business. This country is based on small businesses. Hundreds and hundreds of thousands of us rely on small businesses for jobs, for income, and for the support that is the integral part of the New Zealand economy and community. We as a country rely on small business, yet at the same time we are about to give small business a decent whack. In this Chamber of representatives $40,000 may not seem much, but to a small business $40,000 is the difference between a profit or a loss for a year. It is the difference between that small business retaining its staff. It is the difference between that small business still having a shop on the corner so that we can go down and get our newspaper on a Sunday morning. It is the difference between a small business actually paying the taxes that build up to pay the salaries of Government. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000555\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022eaf79431-1033-44f1-a633-22633da52c0d\u0022\u003EThose small businesses cannot be kicked in the guts forever and a day. At some point in time they will either go out of business or go to Australia. They will do that; they will walk with their feet, as we have seen in the last year. We cannot do that to a country built on small business.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000556\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002213d5da5096b44945b61046778e0ef2d4\u0022\u003EChris Auchinvole\u003C/span\u003E: But they will.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000557\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022eaf79431-1033-44f1-a633-22633da52c0d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00222e75bc59a20549169674d2bbcb9d918e\u0022\u003EDAVID BENNETT\u003C/span\u003E: Members opposite certainly will, and at the same time they are sending the wrong signals to all New Zealanders about the need for debt. We have a country whose economy has been strangled over the last 7 years. It is an economy that is now going into low-growth mode. On the world scale we need to be growing at 9 or 10 percent to keep up with our Asian neighbours. But what will we grow at? Probably at a rate of 1 to 2 percent. That is simply not enough to pay for the debt levels New Zealanders are incurring. New Zealanders borrow to the hilt. That is fine, they can borrow to the hilt, but they have to pay the mortgage, and they are not going to pay the mortgage if New Zealand does not have growth. We live in a country governed by a Government that does not understand that, that is willing to strangle growth, and at the same time is willing to forgive debts to the extent of $40,000. It does not have any concept of reality or safeness for small business.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00221a705910-5320-43bf-aa82-027a761519f6\u0022 data-id=\u002220297dfc2a484bb7a7978c3d3324af59\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000558\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221a705910-5320-43bf-aa82-027a761519f6\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002220297dfc2a484bb7a7978c3d3324af59\u0022\u003ERUSSELL FAIRBROTHER (Labour):\u003C/span\u003E There is nothing worse for a small business than to have the expectation of a debt being repaid that will not be repaid. It leads to borrowing from the bank in order to cover assets that will never be realised\u2014namely, unpaid debts. The no-asset procedure is an enlightened piece of legislation in the debt recovery regime. In fact, it is a natural extension from the present provisions of the Insolvency Act, because bankruptcy is not an automatic consequence of filing to put someone in bankruptcy. The judge always retains the discretion to make a bankruptcy order, because the underlying thesis of granting that discretion is a protection to the commercial community from a continually bad debtor. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000559\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221a705910-5320-43bf-aa82-027a761519f6\u0022\u003EThe no-asset procedure has high qualifying standards. Clause 359 has five prerequisites, two of which are important in rebuttal of the matters raised by previous speakers. First, clause 359(1)(a) states: \u201Cthe debtor has no realisable assets;\u201D. Of course, an income that will enable payment of the debt over a 12-month period is a realisable asset, so any person with such an income would not qualify for a no-asset procedure. Under clause 359(1)(e), a debtor must meet a prescribed means test, to prove that he or she \u201Cdoes not have the means of repaying any amount towards those debts.\u201D So a person who applies for a no-asset procedure will not be granted that status if there is any ability, within the 12-month period, to repay the debt. But, more important, we find in clause 360(c) that a debtor who has incurred debt, knowing that he or she does not have the means to repay it, will not be allowed into a no-asset procedure. So a debtor who is careless and reckless is precluded from entering the no-asset procedure. That provision underscores the basic tenet of the present bankruptcy laws that that is a discretion designed to protect the commercial community. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000560\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221a705910-5320-43bf-aa82-027a761519f6\u0022\u003EIf a person is not a threat to the commercial community but is in a circumstance where he or she, having acted in good faith, comes to a stage where he or she cannot pay his or her debts, then all creditors are entitled to know that, in order to clear what would otherwise be an asset from their books and get on with planning their businesses accordingly. So a debtor who is in the unfortunate position of being in good faith but of having no realisable assets, which would include a good income over the next 12 months, can apply for a no-asset procedure because it cancels out the share of unmeritorious assets in a creditor\u2019s book, based on the assumption that maybe that debtor will one day pay. Of course, if the circumstances of the debtor do change in a 12-month period, then clause 367 applies, because in the event of such a change the official assignee must be notified of that and, of course, the next step would be for the person to go either straight into bankruptcy or into the insolvency provisions. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000561\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221a705910-5320-43bf-aa82-027a761519f6\u0022\u003EThe no-asset procedure will not be used in a widespread way. It is a simple cut-off, sanitising process for a person who cannot repay debts that have been incurred in good faith. It is an asset to the business community, because it gives everybody a standard for assessing which debts will be repaid and which people are worth lingering with, in the hope that they will repay debt. But, of course, a creditor also has a say in this procedure. Under clause 362, a creditor has time to object to a debtor being placed into a no-asset provision situation. The final underscoring of the good-faith provisions that underlie the no-asset procedure is that a debtor may be placed into a no-asset procedure on only one occasion. One mistake is OK in the commercial world, but two are a bad habit and people cannot be placed in a no-asset procedure again. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000562\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221a705910-5320-43bf-aa82-027a761519f6\u0022\u003ESo instead of the misrepresentation we have heard from the speakers on the Opposition side of the debate, I can tell the Committee that the no-asset procedure is a logical extension of the discretion the court has under the present insolvency laws. It is a low-expense provision that enables creditors to truly appraise what are good debts and what are bad debts, because it has the measuring stick of the official assignee, who has to apply stringent test criteria before admitting someone to a no-asset procedure. There is the out of the creditor having a chance to object, and there is the opportunity, should the debtor\u2019s position improve, for the debtor to move from a no-asset procedure to an insolvency or even bankruptcy basis, or to repay his or her bills.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002223de6bd3-0482-495d-88f4-7cc3f75d8442\u0022 data-id=\u002222788bdf432a494fa821495364e4a426\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000563\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002223de6bd3-0482-495d-88f4-7cc3f75d8442\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002222788bdf432a494fa821495364e4a426\u0022\u003ENATHAN GUY (National):\u003C/span\u003E I thought I would even the slate with our colleagues on the other side, because what a lot of diatribe we have just heard from Russell Fairbrother, the former member for Napier. I think the people out there who may have been listening to that speech would be completely confused, so I will take the few moments I have to even the slate and talk about why we are so uptight about supporting Part 5. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000564\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002223de6bd3-0482-495d-88f4-7cc3f75d8442\u0022\u003EThe no-asset procedure seems complete stupidity to me when I read it. This procedure will allow people 12 months in which they can write off their debt and be discharged from it. Up to $40,000 can be written off. We heard from the hard-working member for Hamilton East, Mr Bennett, about the importance of small business and how it is often those people who are waiting for the cheque to come on the 20th of the month and hoping that it will come. They know full well that if the cheque is late it may mean bad news for them. Let us think about the creditors out there\u2014the small-business people who are the heart of our economy. Somewhere between 90 and 95 percent of the small businesses in New Zealand actually drive the economy. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000565\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002223de6bd3-0482-495d-88f4-7cc3f75d8442\u0022\u003EWe need to be mindful of the signal we are sending to the rest of society when someone can come in with a clean slate and write off $40,000 of debt. When we think about the culture of savings in this country, we are pretty poor. There is hire purchase, the credit card debt that people rack up, traffic offences and parking fines that are not paid, and now, in Part 5, we are signalling to those people that they can write off $40,000 and live happily ever after. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000566\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002223de6bd3-0482-495d-88f4-7cc3f75d8442\u0022\u003E So there is a lot of stupidity around Part 5. It is fair enough that we give debtors a second chance so they can start again, but I think it is too easy to allow those people to just chuck everything in and not to take into account the real importance of those creditors that I have spoken about. The creditors\u2014the last cab off the rank when a company goes into insolvency\u2014are left high and dry under this proposal. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000567\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002223de6bd3-0482-495d-88f4-7cc3f75d8442\u0022\u003EI think it is important that we have a look at the no-asset procedure in clause 359(1). It states: \u201C(a) the debtor has no realisable assets; and (b) the debtor has not previously been admitted to the no asset procedure; and (c) the debtor has not previously been adjudicated bankrupt; and (d) the debtor has total debts that are not less than $1,000 and not more than $40,000;\u201D. Clause 359(2) refers to section 156 and states: \u201CIn this section, realisable assets does not include the assets that a bankrupt is allowed to retain under section 156.\u201D I refer to that because it is pretty important and I would appreciate the Minister in the chair, Pete Hodgson, taking a call. Clause 156(1) states: \u201CThe bankrupt may choose and retain as the bankrupt\u2019s own property certain assets up to a maximum value.\u201D I would appreciate the Minister taking a call on that. I ask him to let us all in the Committee this evening know what is a certain asset up to the maximum value. I look forward to him taking a call on that. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000568\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002223de6bd3-0482-495d-88f4-7cc3f75d8442\u0022\u003EClause 156(3) states: \u201CThe assets and their maximum value are\u2014(a) the bankrupt\u2019s necessary tools of trade\u2014\u201D. I think it is important to realise that for those people, their tools of trade are extremely important. The examples given in clause 156(3)(b) are: \u201Cnecessary household furniture and effects, including clothing, for the bankrupt and his or her relatives and dependants\u2014the maximum value is fixed in the Assignee\u2019s discretion:\u201D. It is interesting to see that a motor vehicle is valued at $5,000. When the Minister takes a call about my previous question I would really appreciate it if he could tell us how he has come to the value of a motor vehicle at $5,000. For a lot of small businesses $5,000 is a very small amount for a vehicle.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022 data-id=\u0022731d36a985cb4a25abf433ed13543738\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000569\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022731d36a985cb4a25abf433ed13543738\u0022\u003ECHRISTOPHER FINLAYSON (National):\u003C/span\u003E I want to take a very brief call on Part 5. I certainly do not intend to speak about subparts 1 to 3, which, as Mr Tremain said, largely re-enact equivalent provisions in the 1967 Insolvency Act. But I do raise a couple of questions about the no-asset procedure in subpart 4 and I would be most grateful if the Minister in the chair, the Hon Pete Hodgson, could condescend to answer them. They are not so much on the morality of the no-asset procedure but on the necessity for it. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000570\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003ELet me explain it this way, from the point of view of the debtor. The debtor finds himself or herself in trouble and, prima facie, would appear to qualify for entry into the no-asset procedure. Clause 358 states: \u201C(1) A debtor who meets the criteria set out in section 359 may apply to the Assignee for entry \u2026\u201D, and the assignee, as other speakers have said, may admit that debtor to the no-asset procedure if the assignee is satisfied on reasonable grounds as to the criteria set out in clause 359(1). So it is very much at the discretion of the assignee. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000571\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003EThe Minister Lianne Dalziel said when she was in the chair that this procedure is an alternative to bankruptcy. But I wonder whether that is right\u2014for the reasons that Mr Fairbrother explained when he gave his speech\u2014because, under clause 11, adjudication by the court is discretionary, and the court may refuse to adjudicate in the circumstances set out in clause 37, which largely re-enacts section 26(2) of the Insolvency Act. The four criteria in clause 37 are: \u201C\u2026 if\u2014(a) the applicant creditor has not established the requirements set out in section 13; or (b) the debtor is able to pay his or her debts; or (c) it is just and equitable that the Court does not make an order of adjudication; or (d) for any other reason an order of adjudication should not be made.\u201D \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000572\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003EThere are numerous examples where the court has declined to exercise its discretion under the existing section 26(2). One of the principles that is set out is that a lack of assets is no bar. A lack of assets is a factor that the court should take into account in the exercise of its discretion, but it is not a bar to the making of an order that is otherwise appropriate. As the commentaries have said, a lack of assets is not to be found lightly. At the time of the hearing of the petition\u2014or of what will become an application, under the new legislation\u2014the court would generally not have sufficient material before it to decide the question, and the public examination of the debtor may have the effect of bringing assets to light. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000573\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003EThe point I am making\u2014from the debtor\u2019s point of view\u2014is that, rather than bother to go into the no-asset procedure set out in Part 5, he or she may decide simply to oppose the application for bankruptcy on the grounds that to bankrupt that person would be largely a pointless exercise. So there is the discretionary element in the clause that re-enacts section 26(2) of the Insolvency Act. If that is the case, then I fail to see why the no-asset procedure provision is really necessary. It seems to me that there are sufficient tools under Part 5 to enable compositions with creditors or summary instalment orders, or compositions during bankruptcy. If one adds to that the ability to oppose an application for bankruptcy, which, as I have said, is a discretionary remedy for the court, then one wonders where the no-asset procedure really takes us. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000574\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003ESo for those reasons, quite apart from the business morality reasons that my friends on this side of the Committee have mentioned, I really doubt the usefulness of this provision. I think that the way I have approached it, either by opposing the application for bankruptcy on the grounds set out in the clause that now replaces section 26(2) of the Insolvency Act or by relying on the other tools set out in Part 5, would tend to render the no-asset procedure superfluous.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000575\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003EThe question was put that the amendments set out on Supplementary Order Paper 62 in the name of the Hon Lianne Dalziel to Part 5 be agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000576\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003EAmendments agreed to.\u003C/span\u003E\u003C/p\u003E\u003Ca id=\u0022edd3704c7b194a279b1f45ba66de3e4c\u0022 name=\u0022division\u0022\u003E\u003C/a\u003E\u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EA party vote was called for on the question, That Part 5 as amended be agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EAyes 71\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand Labour 50; New Zealand First 7; Green Party 6; M\u0101ori Party 4; United Future 3; Progressive 1.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENoes 48\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand National 48.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EPart 5 as amended agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000577\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u0022f4554a080e184e3b8d63794fa3f3e779\u0022\u003EPart 6 agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000578\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u002282b7b5c4f2ad4f7d935b210b4a45c2fe\u0022\u003EPart 7  Offences and miscellaneous provisions\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000579\u0022\u003EThe question was put that the amendments set out on Supplementary Order Paper 62 in the name of the Hon Lianne Dalziel to Part 7 be agreed to.\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000580\u0022\u003EAmendments agreed to.\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000581\u0022\u003EPart 7 as amended agreed to.\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000582\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u00223c885024c0a24339a32589fb2da0416a\u0022\u003EPart 8  Companies Act 1993\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000583\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022fae7af0d-c48d-4dd4-88f3-928ccaa3a984\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00221c6c8877587f40598237b42c7c70244e\u0022\u003EThe CHAIRPERSON (Ann Hartley)\u003C/span\u003E: The debate on Part 8 includes debate on schedules 3 and 4.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022 data-id=\u0022f4d37f19c8ac4637af20af0fce6f942d\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000584\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022f4d37f19c8ac4637af20af0fce6f942d\u0022\u003EPANSY WONG (National):\u003C/span\u003E The substantial issue in Part 8 is the introduction of a very positive move known as voluntary administration. The voluntary administration scheme was introduced in Australia in the early 1990s. Since then many different jurisdictions, such as Britain, have introduced similar business recovery procedure schemes. The voluntary administration scheme\u2019s advantage is that it allows an insolvent company, the court, and secured creditors to put a company into voluntary administration and to appoint an administrator. While the company is in voluntary administration, the creditors agree not to enforce repayment, which allows time for the company to work itself back into a solvent state. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000585\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EAll the submitters who came before the Commerce Committee felt very positive about that step, because currently in New Zealand we do not have a voluntary administration procedure. This means that the director of a company that is not doing well can only either request the bank to appoint a receiver, which usually means that the receiver sells the business and, in many cases, the bank calls on the director\u2019s personal guarantee\u2014there is no prospect of maintaining shareholders\u2019 value, and the creditors lose a customer\u2014or a liquidator can be appointed, where usually, once again, trade creditors lose a consumer, and the shareholders\u2019 value is not maintained, or there is out-of-court restructuring. This is difficult, because out-of-court restructuring requires all the creditors to agree on a position, and if even one creditor is opposed, then the whole thing will not fly. The last option is rarely used and is termed a creditors\u2019 compromise, because of the fact that there is no provision that while creditors agree to compromise, all of them would agree not to call back their loan.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000586\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003ESo the advantage of the voluntary administration scheme is that it allows all these people to work together in order to make sure a company that might be in a difficult situation temporarily can work itself out of it. The reason it is successful in Australia is that where creditors agree to go into this voluntary administration, they all have to agree to be treated equally. Nobody has a preferential status. That is where things went very wrong in New Zealand. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000587\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EThe Inland Revenue Department will retain its preferential creditor status, which it has under the current legislation. One hundred percent of the submitters who came before the select committee said that it would not work, for several reasons. The first was that they reckoned that a lot of companies got so far into an insolvent state because the Inland Revenue Department did not call on them to pay, for example, PAYE, GST, or the liable-parents\u2019 payment. That money does not belong to the company or to the Inland Revenue Department; it is actually trust money that the company collects and is supposed to pass on to the department. In one of the cases that I have just shared with the public, one company failed to pay PAYE for 3 years, and it took the department 3 years to take action. In the meantime the company was using trust money, basically, for its cash flow. The other reason submitters say the scheme will not work is that if the department enjoys preferential creditor status why would it agree to voluntary administration, where it would not enjoy that status? Officials from the Inland Revenue Department made a submission to the Commerce Committee and told us that under this preferential creditor status that the department enjoys, it collects only about $5 million a year. So if this Labour Government is serious about making it work, it should remove the department\u2019s preferential creditor status.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022 data-id=\u0022a3508efb5386445d970a10da172b20ef\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000588\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022a3508efb5386445d970a10da172b20ef\u0022\u003EKATHERINE RICH (National):\u003C/span\u003E I rise to speak to Part 8 and I would like to touch on an amendment that I have put on the Table. It arose out of the select committee process but was ignored at that stage. Although I totally agree with the role of business rehabilitation and the aim of voluntary administration, one of the concerns raised by one of the leading accountancy firms was that one of the definitions we have of who can and cannot be a liquidator is far too wide. As a result I have spoken with representatives from PricewaterhouseCoopers, and they continue to hold the view that one of the provisions, new section 280(1)(cb), which is to be inserted by clause 471(1), is written so widely that some of the major accountancy firms could actually be blocked from doing some of the larger and more complex liquidations in this country. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000589\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022\u003EWe are a small country, we have only 4 million people, and our major firms will have established often continuing business relationships with a number of clients. I totally understand the aim of defining who can be appointed to be a liquidator, because we do not want some cowboy or someone who has a super-friendly relationship with the company directors and who can, as a result of good relationships, push things through for the benefit of the failed company, but we do need to be able to ensure that our major accountancy firms are able to conduct their work. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000590\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022\u003ENew paragraph (cb) of section 280(1) states: \u201C(cb) a person who has, or whose firm has, within 2 years immediately before the commencement of the liquidation, had a continuing business relationship (other than through the provision of banking or financial services) with the company, its majority shareholder, any of its directors,\u201D\u2014and this is the main bit\u2014\u201Cor any of its secured creditors, unless, within 20 working days before the appointment of a liquidator, the board of the company resolves that the company will, on the appointment of the liquidator, \u2026\u201D. The concern is that our major accountancy firms may or may not have a continuing business relationship with some of the other creditors involved in the liquidation, but they do have an ongoing business relationship with the main banks. For example, the liquidation arm of PricewaterhouseCoopers may be involved in a liquidation, but that firm may be providing to one of the major banks ongoing business services, advice, or some kind of service that means the firm has a continuing relationship with the bank, which is, of course, one of the secured creditors. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000591\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022\u003EWe have only a certain number of major firms in this country that can do the kinds of liquidations that are more complex and take more time\u2014not the small mum and dad liquidations\u2014and we have only a handful of banks. So if we look at all the major firms, the chances are that they will have an ongoing business relationship with a bank that is likely to be one of the secured creditors in many of these situations. The last thing we want to do is limit the pool of skilled and experienced professionals who are able to undertake the medium to large, complex liquidations in this country. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000592\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022\u003EThis clause may have the unintended consequence of locking out those firms that have the expertise to deal with the big liquidations\u2014the Feltex liquidation, and the other liquidations that we have seen in this country. We are not so concerned about the small, mum and dad operations, which can be dealt with at arm\u2019s length. It is the more complex ones where we rely on the skills and expertise of our top firms that are at issue. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000593\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022\u003EAs we know, there are only a handful of banks in this country and they will have continuing business relationships with the top firms\u2014PricewaterhouseCoopers, Deloitte, Anderson Lloyd Caudwell\u2014and I am sure that the Minister in the chair, Pete Hodgson, knows their names. This is a serious concern that was put forward by those firms during the select committee process, and I am unsure as to why this matter was ignored during that process.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022 data-id=\u0022d4ac2ca204ee48a39f5982ae59295240\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000594\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022d4ac2ca204ee48a39f5982ae59295240\u0022\u003ECHRIS TREMAIN (National\u2014Napier):\u003C/span\u003E Thank you, Mr Chairperson, for the opportunity to speak on Part 8, and to talk specifically about voluntary administration, which is at the heart of this legislation. Voluntary administration provides a company that is experiencing difficulty with a new means to trade out of that position. Indeed, it is a means of encouraging that company to move on. In that regard I echo the thoughts of both Pansy Wong and Katherine Rich. National supports the intent of voluntary administration and acknowledges that it has worked in other countries. But\u2014and I say a big \u201Cbut\u201D, in this regard\u2014it has worked only under certain conditions. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000595\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EThe key condition, which is where National finds itself voting against Part 8, is the priority status of the Inland Revenue Department. In all other countries where voluntary administration has been implemented, the priority status of the Inland Revenue Department has been reduced to that of ordinary, unsecured creditors. In fact, this information was clearly disclosed to us at the submission process, in no uncertain terms. A piece from the Chapman Tripp council newsletter states: \u201CThe recent submissions to the Commerce Select Committee on the Insolvency Law Reform Bill almost uniformly sought amendment of Inland Revenue\u2019s preferred creditor status on insolvency.\u201D So the submissions almost uniformly sought amendment of the Inland Revenue Department\u2019s priority status. That point goes to the very heart of National\u2019s position, which is to vote against Part 8. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000596\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003ELet me explain exactly why that is. Another Act, the Tax Administration Act, gives the Inland Revenue Department a clear sense of its responsibility to the New Zealand taxpayer. In particular, I refer to section 6A(3) of that Act, which makes it clear that it is the statutory duty of the Commissioner of Inland Revenue to \u201Ccollect over time the highest net revenue that is practicable, within the law\u2026\u201D. It is the responsibility of the Commissioner of Inland Revenue to implement that policy. So we have a situation whereby in one Act it is the responsibility of the Inland Revenue Department to collect, under all circumstances, the highest amount possible, yet, in another breath, this legislation tries to implement voluntary administration where the Inland Revenue Department needs to be a partner in that situation. In our opinion that creates a very difficult situation indeed. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000597\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EVoluntary administration lies at the very heart of the Insolvency Law Reform Bill. In fact, voluntary administration has been introduced under the bill in accordance with New Zealand\u2019s obligations under the Memorandum of Understanding on Coordination of Business Law of 2000. I would be interested if the Minister took a call later on and gave us a little bit more information on that memorandum. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000598\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EIn a nutshell, National believes that voluntary administration has significant merit, but, as I have said, only under the right circumstances. National believes that the retention of the Inland Revenue Department\u2019s priority above unsecured creditors, coupled with the responsibility to collect, over time, the highest net revenue that is practicable within the law, will ensure that the Inland Revenue Department votes in favour of liquidation and recovery for itself, as opposed to supporting voluntary administration. Therein lies the problem. We believe that without the Inland Revenue Department\u2019s support, voluntary administration is doomed from the start, and that is why we do not support the bill. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000599\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EThe minority view from National reads as follows: \u201CAll the submitters on this provision were unanimous in their view that unless the Government addresses the issue of the priority status for IRD, the voluntary administration scheme will be severely compromised.\u201D That view echoes the Chapman Tripp newsletter that I mentioned before. The minority view goes on to state: \u201CWe do not believe that Parliament should pass another piece of redundant legislation when there is a groundswell of opinion from practitioners who believe that it will not work, without the removal of Inland Revenue\u2019s priority status.\u201D \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000600\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003ELet me just cover a little information on voluntary administration. It was introduced under the 2000 Memorandum of Understanding on Coordination of Business Law. [Interruption] I am pleased to hear that the Minister will take a call on that later on, and speak with a little bit more depth on that particular memorandum. It aims to replace the seldom-used compromise scheme already available to companies that are in financial stress. A lack of incentives to get a majority of creditors to consent to compromise has been the reason for the lack of use of that part of the older legislation. Voluntary administration was introduced into Australia in the early 1990s, and it has had a degree of success there. But I must say, as I have said earlier, that that success came with the priority status of the Australian office of taxation being reduced. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000601\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EVoluntary administration allows an insolvent company, the court, or secured creditors, to put a company into voluntary administration and to appoint a voluntary administrator. While the company is under voluntary administration there is a stay on creditor enforcement, which is the means with which a company can trade itself out of a difficult situation. It stops that ongoing situation of creditors ringing day after day to hound people into paying their bills. That is indeed a difficult situation to get into. In the voluntary administration situation the administrator manages the company, calls meetings of creditors, and develops a restructuring plan on which creditors are able to vote. A majority of creditors determines whether the company is to be restructured or put into liquidation. Like I said, this system has proven very popular in Australia. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000602\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EThe opportunities directors in New Zealand have without voluntary administration are pretty unappealing at this point in time. They are to request that the bank appoint a liquidator, to appoint a liquidator, and to attempt an out-of-court restructuring. I spoke to some of these issues in the debate on Part 5 tonight, when my learned colleagues spoke about compositions, proposals, no-asset procedures, and summary instalment orders, which we covered off in some depth earlier on. In the main, there is no prospect of retaining any level of shareholder value. If one looks at the balance sheet of a company that is bankrupt, one sees that in most cases there are a heck of a lot more creditors than assets. When one goes out to try to sell, one has to move the stock to move the debtors. If people are able to get 25 percent of their stock value, they are lucky. Debtors use this situation as a means to evade paying their bills, under the guise that there was a problem with the service in the first place. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000603\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EIn contrast, voluntary administration provides directors, shareholders, and creditors with a process that protects a company from enforcing remedies during a reasonably short period. It provides breathing space. During that period, the administrator develops a restructuring plan that potentially allows the business to maintain enterprise value and to deliver a better outcome for creditors, employees, directors, and shareholders. I have to say that employees have to come into this whole thing in a big way, because they are often the unsung heroes in this situation. Having worked for a company for years and years they can find themselves at the end of the line in terms of getting paid. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000604\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EOn the face of it, voluntary administration seems to have merit, but, as I have previously mentioned, the Inland Revenue Department becomes a critical factor in its success or failure. In any voluntary administration, the Inland Revenue Department is likely to be a significant creditor. If we look at some of the situations that Pansy Wong alluded to earlier, we find an example where the Inland Revenue Department was the main creditor. In this situation, which was written about by Keri Welham, the Inland Revenue Department was a creditor to the tune of $1.2 million, but to other creditors the total was $160,000. If people think the Inland Revenue Department will not take preferential status fairly seriously in that example, they have to be joking. As I say, the department is likely to be the main creditor. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000605\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EA person could continue to run a business for some time without paying GST, PAYE, and fringe benefit tax, but could not run a business for very long without power, telephone, and other core operational products. If the Inland Revenue Department\u2019s priority status is retained, as it has been in this bill, then it will be compelled to evaluate its recovery from entering into the voluntary administration scheme versus entering into liquidation. As I said earlier, the Taxation Administration Act makes it clear that the Commissioner of Inland Revenue has a statutory duty to collect, over time, the highest net revenue that is practicable within the law. We must remember that if a company is put into liquidation, the Inland Revenue Department has priority status.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002292824476-4e66-4052-8435-b049833d8b83\u0022 data-id=\u0022b0837bdf0196427983a145169124df71\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000606\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002292824476-4e66-4052-8435-b049833d8b83\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022b0837bdf0196427983a145169124df71\u0022\u003ENICKY WAGNER (National):\u003C/span\u003E It was Charles Dickens in David Copperfield who stated: \u201CAnnual income twenty pounds, annual expenditure nineteen nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.\u201D That is absolutely true of the 3,000-plus people, or companies, who file for bankruptcy in New Zealand every year. It does not matter what has driven them to bankruptcy\u2014although the public tends to have more sympathy for those who have poor health or unemployment than those who have got there through extravagance or gambling\u2014it all ends in misery.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000607\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002292824476-4e66-4052-8435-b049833d8b83\u0022\u003EThis legislation covers both company and personal insolvency. I will consider Part 8 from the point of view of small business and the voluntary administration regime. New Zealand is a country of small businesses; over 300,000 New Zealanders are sole traders or owner-operators. We rely on those businesses for much of the economic health of this country, but by its very nature, small business is risky. It is risky, because resources are limited. It is risky, because profits are small. It is risky, because the business environment is very volatile for small companies. Small businesses are particularly vulnerable, because it takes only a small hiccup to go from being profitable to making a loss; and going from a loss to bankruptcy can be frighteningly quick.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000608\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002292824476-4e66-4052-8435-b049833d8b83\u0022\u003EOne of the biggest vulnerabilities of small businesses is their tendency to trade with other small companies. A case of insolvency in one business can trigger a domino effect, and a series of small businesses can be unwittingly drawn into a financial disaster. Sole traders and small owner-operators are often undercapitalised. To finance business growth, they often borrow against personal assets\u2014more often than not the family home. They also, perhaps unwisely, offer personal guarantees to secure business lending. It is a risk that big business and corporates would never countenance, but one that small-business owners are forced to accept, and take for granted. Mostly, of course, there is no problem, but occasionally things turn sour, and that is where this legislation comes into play.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000609\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002292824476-4e66-4052-8435-b049833d8b83\u0022\u003ETo help small businesses survive difficult times, National supports a voluntary administration regime for companies with financial problems, similar to a scheme being used very successfully in Australia. It makes sense to allow administrators to assess the viability of a company, and, if possible, allow it to have a voluntary plan to trade its way out of trouble, while managing its debts. This seems a sensible and mature approach to company difficulties, and any way to avoid a bankruptcy, and all its destructive side effects, should be considered very seriously.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000610\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002292824476-4e66-4052-8435-b049833d8b83\u0022\u003EAs noted by Chris Tremain, the system is working well in Australia but we have already heard that the major difference between Australia\u2019s legislation and the bill we are debating tonight is that Australia\u2019s tax department waits in line, along with other creditors involved in liquidation. The Labour Government is not prepared to accept this as a reasonable option, and I understand all its arguments, but it seems to me that a voluntary administration will come into being only if there is a good chance of that company trading out of its problems. If it is good enough for creditors to be prepared to take the risk, then it should be good enough for the Inland Revenue Department to take that risk too, particularly in light of the difficulties that small businesses face and the domino effect within companies that trade with each other.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000611\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002292824476-4e66-4052-8435-b049833d8b83\u0022\u003EIt is a reality that, from time to time, businesses falter and stumble into failure. Small businesses are especially vulnerable. It would be good if the House could introduce legislation that would support innovation and responsible risk-taking and entrepreneurialism by giving a viable company a second chance, and, with time, the opportunity to make good.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022 data-id=\u0022ebf299ea329a4cf59e99a5800828682a\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000612\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022ebf299ea329a4cf59e99a5800828682a\u0022\u003ECHRIS AUCHINVOLE (National):\u003C/span\u003E The Government is showing, again, its double-handedness as it comes to light in Part 8. There was a glimmer of this as we were discussing Part 5 in relation to the no-asset register. Then we spoke of the Government seeming to have a double standard, in that it will not extend the opportunity of joining a no-asset register to those with a student loan, but any old debtor to a small business, who qualifies, can join up. The Government seems to be in the business of forgiving the debts of those who owe to commerce, but not to the Government. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000613\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003EPart 8 is a case of \u201Chere we go again\u201D. The Government will not relinquish the Inland Revenue Department\u2019s pre-emptive or priority status for the Inland Revenue Department. That will severely compromise, in our view, the effectiveness of the voluntary administration scheme. Let us remember, it is a voluntary administration scheme. I felt compelled, during one of the Commerce Committee meetings, to say that the difficulty that the Government seems to have with \u201Cvoluntary\u201D is that everything is voluntary until such time as one does not want to do it, then it becomes compulsory. If we are going to have voluntary, then the \u201Cvoluntary\u201D bit has to go right through to the very end, otherwise it becomes a bitter end. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000614\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003ENo one could have doubted the sincerity of the submitters who came before the Commerce Committee. These people, for the most part insolvency practitioners, are people with a tough job. They are constantly being exposed to the stress of others, and, I would guess in every case, having to deal with something that is in every way a mess. For about a decade I worked in a little office in Albert Street in Auckland. It was in the same building as, I think, two or three insolvency practitioners. I used to see their clients going up in the lift and I used to see their clients going down in the lift. The difference in the journeys was that they clearly looked relieved\u2014and in many ways saddened, but none the less relieved\u2014that their immediate responsibility had been handed over to the insolvency practitioners. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000615\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003EFrom my memory of it at the select committee, every insolvency practitioner who appeared before it insisted, beseeched, asked the committee to ensure that the reduction in the Inland Revenue Department\u2019s priority in insolvency matters be adopted as part of the bill, as it is in Australia. I wonder whether that is the memory of other members of the committee. I can see them nodding in agreement. It was. They did not do this on the basis of not liking the Inland Revenue Department. These are real people, and they are in the commercial financial world. It is that by having the priority\u2014and most creditors are not aware, very often, that there is a problem\u2014when the problem begins the department can be aware of it and it is not seen as being overly energetic in taking a company into insolvency. I am not suggesting that is a good thing or a bad thing, but the reality is the department is the creditor that takes people into insolvency eventually, and this allows poorly organised businesses to use moneys that should be paid to the department, to extend their commercial credit extension beyond redemption and recovery. That is one of the key practical bits. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000616\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003E The purpose of voluntary administration is at the heart of the bill. We hear of the early failure of new businesses in New Zealand. It is an oft-repeated statistic. New business has a very high rate of failure. But the reality is that while the individual business might fail, the activity that it started with often continues. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000617\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220bfa5b74-8933-458a-99d4-bbd75d9898d0\u0022\u003EThis has been a fascinating bill to be part of in the discussion process, because I personally believe in it. In my own commercial experience I have engaged in this sort of thing without it being part of the legislation. The creditors got together and worked with a debtor to see whether we could put something together because we knew that if we did not we were not going to get much out of it. The voluntary system of administration is a good one, in my mind. It works, but it works only if there is an incentive for all. The object is to save companies, but by being weak-kneed I think the Government has lost the opportunity.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022136da8c4-afc7-483e-a39c-c66812f71774\u0022 data-id=\u002263450e059ff14d6080d53c7d4b8cf5e9\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000618\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022136da8c4-afc7-483e-a39c-c66812f71774\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002263450e059ff14d6080d53c7d4b8cf5e9\u0022\u003EKATE WILKINSON (National):\u003C/span\u003E I hate to interrupt my learned colleague, because I am sure the quality of his speech was a lot better than the quality of mine will be, but none the less I rise to speak to Part 8, which deals with voluntary administration. This should have been very good legislation, and Part 8 should have been a very good part of it. But unfortunately it is flawed, because the Inland Revenue Department is retaining and clinging to its priority status. This means we do not have a level playing field, which is unfair, and means that this legislation is flawed. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000619\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022136da8c4-afc7-483e-a39c-c66812f71774\u0022\u003EI am somewhat surprised that despite all the submissions to the contrary, this Government has still insisted on retaining the spurious Inland Revenue Department priority. A Government that values the opinion of Chapman Tripp so very, very highly in other matters has disregarded its opinion in regard to Part 8 and in relation to the Inland Revenue Department\u2019s priority. Way back as early as April 2006 it said in its Counsel brochure, which we all received a copy of: \u201CWe consider the likely effectiveness of this procedure, given the policy decision to retain Inland Revenue\u2019s priority in liquidation. We conclude that by retaining this priority there is a significant statutory incentive for Inland Revenue to vote against voluntary administration and in favour of liquidation in order to make a better recovery. It is our concern that if the first wave of voluntary administrations are undone by Inland Revenue voting against restructuring and rehabilitation plans, then the new voluntary administration regime may well lose the confidence of the market.\u201D \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000620\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022136da8c4-afc7-483e-a39c-c66812f71774\u0022\u003EI have a fear that that will indeed happen. In its Counsel magazine Chapman Tripp went on to say: \u201CIn any voluntary administration Inland Revenue will be a significant creditor. If the Inland Revenue priority is retained, Inland Revenue will be compelled to evaluate its recovery out of voluntary administration against its recovery out of a liquidation. If a company is in liquidation, the Inland Revenue priority debt ranks ahead of all other unsecured creditors. In voluntary administration, unsecured creditors will expect to be treated equally with Inland Revenue, in accordance with the pari passu principle (which provides that all creditors in a class are treated equally).\u201D By retaining Inland Revenue priority there is a statutory incentive for Inland Revenue to vote against a voluntary administration and in favour of liquidation to make a better recovery. It may even be that Inland Revenue decides that notwithstanding the general merits of a voluntary administration restructuring plan \u2026 it has a statutory duty to vote in favour of liquidation and priority recovery because\u201D\u2014as Mr Tremain has already pointed out\u2014\u201Cthe Commissioner\u2019s statutory duty is \u2018to collect over time the highest net revenue that is practicable within the law\u2019 (section 6A Tax Administration Act 1994). If Inland Revenue is compelled to vote against voluntary administration restructuring plans, then the prospects of New Zealand\u2019s voluntary administration regime achieving the success of its Australian counterpart are slim. The opportunities that voluntary administration provides to maintain value for all stakeholders, may be lost to the commercial community.\u201D\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000621\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022136da8c4-afc7-483e-a39c-c66812f71774\u0022\u003EThe fatal flaw in this bill, and in this part of the bill, is the clinging to the Inland Revenue Department\u2019s priority status. If the department becomes the preferred creditor it will receive the proceeds of liquidation before other unsecured creditors. Why would it vote for a voluntary administration that would then put it pari passu with other creditors, when it can easily outvote the other creditors and easily have its preferred status? \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000622\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022136da8c4-afc7-483e-a39c-c66812f71774\u0022\u003ECan I repeat some of our minority view in the commentary on the bill. Yes, we agree that the centrepiece of the bill is the voluntary administration scheme, which replaces the seldom used compromise scheme. I can vouch, as a practitioner of 29 years standing, that the compromise was seldom used.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022eaf79431-1033-44f1-a633-22633da52c0d\u0022 data-id=\u002222187fd153644c0ea4baafad216c16e5\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000623\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022eaf79431-1033-44f1-a633-22633da52c0d\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002222187fd153644c0ea4baafad216c16e5\u0022\u003EDAVID BENNETT (National\u2014Hamilton East):\u003C/span\u003E As we have heard in a number of great speeches from the National side, the voluntary administration regime has not exactly been a real problem. It is just part of the implications of it that we find quite difficult to contest. I think Nicky Wagner summed it up very well when she said it was good enough for creditors, but not good enough for the Inland Revenue Department. That makes us think: \u201CWell, why is there a different rule for the IRD?\u201D. The reason must be that this Government feels that the Government is in a higher position than the ordinary New Zealander. The Government sees that it has a greater role than New Zealanders do on the street. It has always been a historical fact that Governments can tax, and they can willingly impose taxes, and people have to pay them. We cannot get out of paying our taxes, and Governments have the ability to implicate people and make them pay a tax. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000624\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022eaf79431-1033-44f1-a633-22633da52c0d\u0022\u003EIt does the same with local government. It pushes services on to local government, which then in turn has to rate ordinary New Zealanders to pay for those services. We do not have a choice in our taxation system. We have to pay the taxes that are imposed upon us. That is something that has occurred throughout history, and it is why we have Governments. It is how Governments are funded. But then why does the Government also want to have priority on the other side of the ledger? It is not good enough for the Government just to have the ability to tax; it is also good enough for the Government to have the ability to take money on the other side, through the Inland Revenue Department and preferential claims when a business may go under. Why cannot the Government sit there, like any other business or creditor, when it has the ability to tax over and above an ordinary creditor? \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000625\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022eaf79431-1033-44f1-a633-22633da52c0d\u0022\u003EThis is something I think this Government needs to look at very closely in its legislation. I look at the reasons why this was put forward in the office of the Minister of Commerce. It said it was \u201Cto ensure that the current business rehabilitation regime will enhance business confidence.\u201D Well, it will not enhance business confidence if we are giving a priority to the Government over ordinary creditors. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000626\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022eaf79431-1033-44f1-a633-22633da52c0d\u0022\u003EAnother big thing this legislation was supposed to do was to ensure that overseas investors were not deterred from investing in New Zealand. Well, they will certainly be deterred if they know that the Government has a higher priority than their creditor ranking would have. It also said that it is \u201Cto ensure that New Zealand adopts an international best practice for business rehabilitation.\u201D Certainly, there are aspects of the voluntary administration regime that we do favour. But that regime needs to be one that is consistent with overseas practice, and this is not. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000627\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022eaf79431-1033-44f1-a633-22633da52c0d\u0022\u003EThe press release from the Minister says that \u201Cthe voluntary procedure will bring New Zealand into line with other OECD countries.\u201D It would be great if we could do that with a few other things, like employment law, and have a probationary period. But it said that it \u201Chas been adopted from the Australian voluntary administration regime, which has had the advantage of benefiting business rehabilitation involving trans-Tasman organisations.\u201D That is all very good rhetoric, but will it be followed up? The reality is that this legislation is different from Australia\u2019s. How can the Minister say in her press release that we are doing what Australia and the other OECD countries want and do, when we are doing the opposite? \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000628\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022eaf79431-1033-44f1-a633-22633da52c0d\u0022\u003EFor example, Australia abolished the priority status of the Australian tax office in the early 1990s, while the UK followed suit in 2002. This is not consistent with the Minister\u2019s press releases. The Minister says we will be following OECD best practice in doing what we are doing. The reality is we are not following OECD best practice; we are just feathering the caps of a Government that wants to have the ability not only to tax but also to have priority status when a business goes under. Why would the Government want to do that when it has an $11.5 billion surplus? How much money do Government members actually need to be sitting on to make them happy? How many big buildings in Wellington do they need? How many statues to their Government do they need to erect to be happy? They need to keep on going because they need to build up their war chests for an election campaign to buy off New Zealanders. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000629\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022eaf79431-1033-44f1-a633-22633da52c0d\u0022\u003EThat is the reality of why they want to have preferential status. They are not looking after New Zealand business people; they just want to build up the money so they can go out there and bribe at the next election. Or maybe they want the money to pay off a few debts they have carried over from this election, by way of a few payments to certain organisations that will in turn repay them through financial assistance. It is all part of this Government knowing what is best for ordinary New Zealanders. It believes that it knows what to do.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022 data-id=\u0022ac9f582a1d314c48abcd7876c048fe60\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000630\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022ac9f582a1d314c48abcd7876c048fe60\u0022\u003ECHRISTOPHER FINLAYSON (National):\u003C/span\u003E I will briefly address the Committee on Part 8, and say, as has been said by some of my colleagues on this side of the Chamber, that this part really is the centre point of the insolvency law reform package that we have been dealing with tonight. It is the most significant reform in this bill. The policy decision of the Government that underpins it is that the voluntary administration regime should be aligned as closely as possible with the Australian provisions unless there is a very, very good reason to depart from them. As I understand it, this policy decision was made in accordance with New Zealand\u2019s obligations under the 2000 Australia - New Zealand Memorandum of Understanding on Coordination of Business Law.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000631\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003EThe real issue for determination tonight\u2014and I would be grateful if one of the Government members said something about it\u2014is that although we are purporting to introduce basically the Australian procedure, we have left one major element out. That element concerns the priority of the Inland Revenue Departmentm, which will have the effect of messing up the entire procedure.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000632\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003EThe objects of voluntary administration that are set out in new section 239A of Part 15A, which will be inserted into the Companies Act by clause 454, are laudable. They propose that voluntary administration will maximise \u201Cthe chances of the company, or as much as possible of its business, continuing in existence;\u201D, and, if that is not possible, then voluntary administration will manage matters in such a way as to ensure that there is \u201Ca better return for the company\u2019s creditors and shareholders\u2026\u201D. The procedures are all reasonably straightforward, and I have no real objection to them culminating in what Subpart 8 refers to as the \u201Cwatershed meeting\u201D, which is the crunch meeting when the company\u2019s creditors must determine what will be the future of the company.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000633\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003EAs my colleagues have said, when one is dealing with a voluntary administration, one finds that nine times out of 10 the Inland Revenue Department will be a major creditor, if not the most important creditor. I am sure that the Inland Revenue Department, armed with its priority for revenue debt, will be compelled to evaluate its recovery out of the voluntary administration regime, as opposed to its recovery out of a liquidation. I refer members to Subpart 10 of Part 3, which deals with the distribution of assets, and, in particular, to clause 272 on priority of payments. The Inland Revenue Department is compelled to evaluate its recovery because, as we well know, if a company is in liquidation, the department debt will rank ahead of all other secured creditors. In a voluntary administration, the department debt will rank equally in accordance with all unsecured creditors. So the Inland Revenue Department will have to decide whether it is content with that state of affairs or whether it is better to place the company in liquidation.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000634\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003EI refer very briefly to what the distinguished law firm Chapman Tripp said about this issue. We all know that the Government pays a lot of attention to Chapman Tripp, as it did last week. Chapman Tripp said: \u201CIf the first wave of voluntary administrations are undone by the Inland Revenue voting against restructuring and rehabilitation plans, then voluntary administration will lose the confidence of the market. Australian businesses involved in New Zealand voluntary administrations will be incredulous that our procedure departs so markedly from theirs. However, what is most disappointing and ironic is that the most significant risk to the government ambition of introducing and implementing a successful rehabilitation procedure will be the government itself.\u201D I particularly refer to the fact that Chapman Tripp says that Australian businesses \u201Cwill be incredulous that our procedure departs so markedly from theirs.\u201D\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000635\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003ESo the only question I have for the Minister\u2014or for any Government member who is prepared to take a call\u2014is why the Government, when introducing this mechanism that is adopted from the Corporations (Investigation and Management) Act 2000 and the Australian Corporations Act 2001, has chosen to treat the Inland Revenue Department in the way it has. It will undermine the effectiveness of the new regime.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002223de6bd3-0482-495d-88f4-7cc3f75d8442\u0022 data-id=\u002235df91668366495ca5c5523cb47f3332\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000636\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002223de6bd3-0482-495d-88f4-7cc3f75d8442\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002235df91668366495ca5c5523cb47f3332\u0022\u003ENATHAN GUY (National):\u003C/span\u003E Following on from Mr Finlayson, it is good to take a call on Part 8. I think everyone would fundamentally agree that something such as this Insolvency Law Reform Bill needs to happen, as there have not been any substantial changes to the insolvency legislation since 1967. But the reality is that Part 8 is the fundamental part in this whole bill that will turn things upside down.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000637\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002223de6bd3-0482-495d-88f4-7cc3f75d8442\u0022\u003E Those people who were fortunate enough to sit on the Commerce Committee know that most of the submitters\u2014I think close to 100 percent of those who submitted\u2014had concerns about the priority status of the Inland Revenue Department. What I cannot understand is why the Government has not addressed that in Part 8. That is the biggest concern to me with this part. All creditors should be treated equally. That is, fundamentally, I would have thought, a common-sense principle, but, no, under this part the Inland Revenue Department gets its dibs on its loot, no matter what. The Inland Revenue Department can vote to put someone into liquidation, and it seems to me that that is fundamentally flawed and unfair. It seems to me that it is very like bully-boy tactics.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000638\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002223de6bd3-0482-495d-88f4-7cc3f75d8442\u0022\u003EWe heard earlier from Mr Bennett about high taxation being used to build up a big war chest for the next election, about how this Government is very much about big tax, and about how there will be a big lolly scramble in 2008. But, in essence, we do not want to see in Part 8 the Inland Revenue Department being the first cab off the rank and having the ability to force people into liquidation.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000639\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002223de6bd3-0482-495d-88f4-7cc3f75d8442\u0022\u003EI refer to the National Party\u2019s minority view in the select committee report, because I think it is really important. Following on from the point I made earlier, all the submitters on this provision\u2014I am talking about voluntary administration\u2014were unanimous in their view that unless the Government addresses the issue of the priority status of the Inland Revenue Department, the voluntary administration scheme will be severely compromised. That should send alarm bells around this Chamber. The minority view states: \u201CThe select committee did not pursue in-depth ways to ensure that the centre-piece of the bill will be effective to the satisfaction of New Zealand National members.\u201D\u2014in other words, we were unheard; the committee did not listen. \u201CWe do not believe that Parliament should pass another piece of redundant legislation when there is a groundswell of opinion from practitioners who believe that it will not work, without the removal of Inland Revenue\u2019s priority status.\u201D In other words, the committee has not listened to National\u2019s minority view.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000640\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002223de6bd3-0482-495d-88f4-7cc3f75d8442\u0022\u003EI think it is important to look across the Tasman to our Australian counterpart. It has abolished the priority status. When we look across to the UK, we see that it has ditched priority status. We do not seem to be following the OECD\u2019s best practice. We seem to be out on a limb with Part 8. Fundamentally, parts of this bill are necessary, but Part 8 is of great concern to me, and should be to many of us in the Chamber. That is why National cannot support Part 8.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022 data-id=\u0022cf57e86bb40440409a795cfcbe007337\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000641\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022cf57e86bb40440409a795cfcbe007337\u0022\u003ECHRIS TREMAIN (National\u2014Napier):\u003C/span\u003E I wish to round out my arguments earlier on this evening on Part 8 of the Insolvency Law Reform Bill. I spoke at length about voluntary administration, and how it does appear to have merit\u2014in fact, we have seen that it does have merit overseas. I spoke, in depth again, about the level of priority status, and I think it would be inept of me not to discuss the full consideration that the Commerce Committee had\u2014particularly given that Maryan Street, who was at those meetings, is here in the Chamber with us tonight. In terms of the points that Shane Jones made regarding why priority status was left where it was, I will cover those off in some detail. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000642\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EAs I have said, on the face of it the idea of voluntary administration appears to have merit, but as I have previously mentioned, the Inland Revenue Department becomes a critical factor in its success or failure. In any voluntary administration the Inland Revenue Department is likely to be the significant creditor. Why? Well, a person can run a small business by putting off paying the PAYE, by putting off paying the GST, and by putting off paying the fringe benefit tax, but a person cannot keep his or her business going by putting off paying the power, the telephone, and all those items for which, if he or she stopped paying the bills, it would unfortunately mean he or she would not have a business. So what tends to happen is that the department ends up being a significant creditor in many of the situations we are talking about. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000643\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EIf the department\u2019s priority is retained, as it has been in the bill, the department will be compelled to evaluate its recovery from entering voluntary administration versus entering liquidation. As I have said previously, section 6A of the Tax Administration Act ensures that the commissioner is required to collect tax over anything else\u2014that is his or her priority. By retaining the department\u2019s priority, there is a statutory incentive to vote against voluntary administration in favour of liquidation, to ensure the department gets better recovery. If the department is compelled to vote against voluntary administration, I cannot see how it will have the success it has been able to achieve overseas. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000644\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EHow did voluntary administration have success overseas? In Australia, the Australian Taxation Office priority was amended, but at the same time director responsibility was increased. We did discuss that point in the select committee, but we have not rounded it out tonight. Here is how it works. If a company has failed to pay tax that it is required to collect, then the Australian Taxation Office can issue the directors with a notice requiring the directors to, firstly, comply with its remittance obligations; secondly, make an agreement with the Australian Taxation Office; thirdly, appoint an administrator; or, lastly, appoint a liquidator. The key point is that if the company does not take one of those steps within a 14-day period, each director can be personally liable for the unpaid amount of tax the company is required to collect. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000645\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EShane Jones argued vociferously in defence of the corporate veil. He argued\u2014and I understood his point on this\u2014that if we actually increased the directors\u2019 liability, then we would discourage more directors and more entrepreneurs from getting into business. He made the point that if we are to have economic transformation in this country, we do not want to increase the barriers to, and risks of, directorship. Shane Jones did not want to increase director liability, so he voted in favour of retaining the department\u2019s priority status. I argued that we did not need to follow the Australian model, and that we could have removed the department\u2019s priority status and kept director responsibility unchanged. The select committee seemed unable to cover that\u2014why we could lower the department\u2019s responsibility and not increase director responsibility. One can bet that in this instance the department would be far more vigilant with regard to late PAYE and GST remittances, and that as a result, companies would not be allowed to get to the point where liquidation was the only option. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000646\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EOther alternatives that were not fully debated included, firstly, reducing the department\u2019s priority to a limited period only\u2014say, a specific period of 3 to 6 months prior to liquidation or receivership\u2014and, secondly, the English approach, which eliminated the Crown priority completely in 2002, on the basis that the fiscal cost to Treasury was insignificant. This is a key quote that I think we will end this part of the debate on: \u201CThe state could not maintain the priority, because the government could not get any sympathy from the private sector over its long delay in collecting back taxes \u2026 such rank inefficiency merely confirmed to private creditors that government needed stronger incentives to keep abreast of creditor delinquency\u2026\u201D. That was the point. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000647\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003ESo, in summary, National believes that for voluntary administration to work effectively, the department\u2019s priority needs to be removed or limited. We believe that the retention of the department\u2019s priority will lead to difficulties in implementing the key component of the bill. We believe that we did not explore other alternatives enough. Thank you.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000648\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003EThe question was put that the following amendment in the name of Katherine Rich to clause 471(1) be agreed to:\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000649\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221368ba6c-25be-40f6-a2a0-8f81e1f78b79\u0022\u003Eto omit from paragraph (cb) of section 280(1) the words \u201Cor any of its secured creditors\u201D.\u003C/span\u003E\u003C/p\u003E\u003Ca id=\u00228caff4f613724cde94acb79570a65bbf\u0022 name=\u0022division\u0022\u003E\u003C/a\u003E\u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EA party vote was called for on the question, That the amendment be agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EAyes 48\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand National 48.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENoes 71\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand Labour 50; New Zealand First 7; Green Party 6; M\u0101ori Party 4; United Future 3; Progressive 1.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EAmendment not agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000650\u0022\u003EThe question was put that the amendments set out on Supplementary Order Paper 62 in the name of the Hon Lianne Dalziel to Part 8 be agreed to.\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000651\u0022\u003EAmendments agreed to.\u003C/p\u003E\u003Ca id=\u0022562529e8e7eb4904bda56d19ec1b6f8e\u0022 name=\u0022division\u0022\u003E\u003C/a\u003E\u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EA party vote was called for on the question, That Part 8 as amended be agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EAyes 71\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand Labour 50; New Zealand First 7; Green Party 6; M\u0101ori Party 4; United Future 3; Progressive 1.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENoes 48\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand National 48.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EPart 8 as amended agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000652\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u0022ef36047eeea44572a693ba84ce3d2256\u0022\u003EPart 9  Cross-border insolvency\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000653\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220ed9ad81-05c1-4171-80c6-24fa02cade42\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022a2c3ec76ed7b4b9c9bc54ac39501817a\u0022\u003EThe CHAIRPERSON (Hon Clem Simich)\u003C/span\u003E: The debate on this part includes debate on schedules 5 and 6.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022 data-id=\u0022d5459c8c5e7a483ab4e160041b662c1a\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000654\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022d5459c8c5e7a483ab4e160041b662c1a\u0022\u003EPANSY WONG (National):\u003C/span\u003E Part 9 is about cross-border insolvency, and the National Party is in favour of these provisions. Quite interestingly, the commencement date for this part is a date to be appointed by the Governor-General by Order in Council. We were told that the reason for the flexibility through the Order in Council process was that we were waiting for Australia to enact similar legislation. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000655\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003ENational sees that in the current environment businesses have become increasingly global. More than that, the mobility of businesspeople, etc., throughout the world has become such a frequent and accepted pattern that New Zealand should implement the model law of cross-border insolvency adopted by the United Nations Commission on International Trade Law on 30 May 1997. The law was also ratified and approved by the United Nations, and we accept that this is a very sensible and forward-looking move. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000656\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EWe support this part, but I wonder whether there will be vigilant implementation of it. Although Parliament may pass legislation, at times one wonders whether the application of that law will be as effective as politicians may think. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000657\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EI have an example of a recent case in point involving a sad occurrence. Last Monday, in the pouring rain in Auckland, a group of protestors gathered outside the Auckland Central Police Station. Those people, unfortunately, are a group of unsecured creditors who utilised a finance entity known as An Ying, which has many subsidiaries and owns different companies under similar names. An Ying International Financial Ltd has gone into bankruptcy and a lot of the individuals involved used that organisation for transmitting money from China to New Zealand. Some have used the company for foreign currency exchanges. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000658\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EOne person in the group told me that he had just transmitted money but was informed that, because of the large sum involved, the transfer would take about 3 to 5 days. Of course, 5 days later he suddenly found out that the entity was no longer operating. A group of creditors applied to put An Ying International Financial Ltd into bankruptcy. The liquidator put out a statement that the repayment of money involved the ability to find out what overseas assets that company or the people responsible for the company might have. One can only live in hope that an international arrangement of this nature can be enforced effectively. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000659\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002280b11f68-6b57-4b8b-8922-aecd1d471975\u0022\u003EAs I said, because nowadays there are so many transnational businesses, our people can be quite vulnerable when individuals or businesses move to New Zealand and start businesses here. Do we actually know their reputation? That is the first challenge. The second one is whether we can believe that they are being upfront, when they have insolvency problems, as to whether they have assets overseas.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022 data-id=\u0022a5b3b4073db044c295faf90af2d213ca\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000660\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022a5b3b4073db044c295faf90af2d213ca\u0022\u003EKATHERINE RICH (National):\u003C/span\u003E This will be the last call I will take for the evening. I would like to make a few comments about schedule 5, which contains the provisions relating to model law on cross-border insolvency. This was an issue that I had not considered prior to being part of the Commerce Committee, and I would like to acknowledge the officials here today. The work they did in communicating some quite technical concepts and principles to a table full of select committee members who initially were not au fait with insolvency law is to be commended. So we were very thankful that they were able to take some very difficult concepts and explain them to us, and cross-border insolvency was one of those issues. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000661\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022\u003ECross-border insolvency arises when an insolvent entity is placed in a form of insolvency administration in one country but has assets or debts in another country or countries. So a Kiwi firm might have been dealing with an Australian firm, as just one example, or a firm in the United States. Its bill is not paid and it has to make a decision about where to go to from there. So, of course, one needs laws in common to be able to have some kind of framework to allow some kind of justice on both sides. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000662\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022\u003ESo it is timely that we look at this area. As members will be aware, some of this law has not been considered since the 1960s, and other parts have not been considered since the enactment of the Companies Act in 1993. The world has changed a lot since then, so it is time for New Zealand to adopt the provisions of the model law on cross-border insolvency adopted by the United Nations Commission on International Trade Law. The area is often also referred to as UNCITRAL, which sounds like one of those acronyms that do not really roll off the tongue very well. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000663\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022\u003EI have a couple of questions I would like to put to the Minister. During the select committee process, members were told that banks that were subject to statutory management and were under the Reserve Bank of New Zealand Act 1989 were expressly excluded from the operation of the model law on cross-border insolvency. There may be a very simple reason for this, and as I did not have an opportunity during the select committee process to ask about this, I would like to put it to the Minister now. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000664\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022\u003EThe second question I ask is why we are embracing this model law only after Australia has done so. The aim of having embracing model law is to ensure that we take part in the international framework so that Kiwi companies are dealing with the United States, the UK, or wherever, and obviously Australia being our closest neighbour. Why are we waiting for Australia to take on board the law before we do? Once again there might be a pretty simple reason for that, and I would be interested in hearing an explanation tonight. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000665\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022\u003ESo the aim is to facilitate cross-border insolvencies. It is not easy when firms have to deal with companies that go bust at home. It makes it so much harder when one is dealing with a firm that is offshore. We need to have consistent rules so that Kiwi firms can have greater certainty. Officials argued during the select committee process that by embracing this law the increased certainty would, in fact, add to New Zealand\u2019s economic growth. I think the jury is still out on that. I am unsure whether that will be the case. But certainly on this side of the Chamber we think it is a good thing that we engage in a framework that will provide greater consistency around the world, as long as all the parties are working under the same law. Obviously some Kiwi firms will still continue to deal with some countries that do not. But this looks to be a step forward, and we will see whether there are additional benefits from this point.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000666\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002295ac7206-f497-429d-bf58-715224d5160f\u0022\u003EPart 9 agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000667\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u00225f989928f79e4e3baaf0d2d1c7de41bc\u0022\u003ESchedule 1 agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000668\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u00222e6bdb2c1adb4354975ce5ccd85130a6\u0022\u003ESchedule 2\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000669\u0022\u003EThe question was put that the amendments set out on Supplementary Order Paper 62 in the name of the Hon Lianne Dalziel to schedule 2 be agreed to.\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000670\u0022\u003EAmendments agreed to.\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000671\u0022\u003ESchedule 2 as amended agreed to.\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000672\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u00225026d880003c4430bebec4e7c07e3f0d\u0022\u003ESchedule 3\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000673\u0022\u003EThe question was put that the amendments set out on Supplementary Order Paper 62 in the name of the Hon Lianne Dalziel to schedule 3 be agreed to.\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000674\u0022\u003EAmendments agreed to.\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000675\u0022\u003ESchedule 3 as amended agreed to.\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000676\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u0022a10786bff6374af98c35637b5900fb05\u0022\u003ESchedule 4\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000677\u0022\u003EThe question was put that the amendment set out on Supplementary Order Paper 62 in the name of the Hon Lianne Dalziel to schedule 4 be agreed to.\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000678\u0022\u003EAmendment agreed to.\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000679\u0022\u003ESchedule 4 as amended agreed to.\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000680\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u0022ad8be04116ac4c96b300b61af07d9489\u0022\u003ESchedule 5 agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000681\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u0022b7d14418c2fe43bea89fcc505f66b918\u0022\u003ESchedule 6 agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000682\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u0022c23c7c5980c84363a10342f7619158f3\u0022\u003EClauses 1 and 2\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022 data-id=\u002258661bcd78bd4ebf8812a8fa0e1a2ed0\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000683\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002258661bcd78bd4ebf8812a8fa0e1a2ed0\u0022\u003ELINDSAY TISCH (National\u2014Piako):\u003C/span\u003E National, as members have heard in the debate on the Committee stage this evening, has supported most parts. However, we had concerns with Part 3, Part 5, and Part 8; consequently, we voted against those parts. If we reflect on National\u2019s minority view, which is set out in the commentary on the bill, we see that our speakers and our members who were on the select committee have identified that: \u201CThe centrepiece of this bill is the \u2018voluntary administration\u2019 scheme which will replace the seldom-used \u2018compromise\u2019 scheme.\u201D It is interesting to note that all submitters on that provision were unanimous in their view that unless the Government addressed the issue of priority status for the Inland Revenue Department, the voluntary administration scheme would be severely compromised. With that in mind, our speakers, especially Pansy Wong, who led the debate in this area, were adamant that we had to vote against the voluntary administration provisions. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000684\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003EFurther, we do not believe that Parliament should pass another piece of redundant legislation, when there is a groundswell of opinion from practitioners who believe that the legislation will not work without the removal of the Inland Revenue Department\u2019s priority status.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000685\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003EThe other point we were very mindful of was the newly introduced no-asset procedure, whereby an individual can choose to enter into a scheme for 12 months in return for a write-off of $40,000. We ask where the personal responsibility is\u2014the individual responsibility\u2014for the debts that have been incurred. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000686\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003EOverall, with that in mind, National says that while we support some parts, we will be voting against this bill.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000687\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003EClause 1 agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000688\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003EClause 2 agreed to. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000689\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003EThe Committee divided the bill into the Insolvency Bill, the Companies Amendment Bill, and the Insolvency (Cross-border) Bill, pursuant to Supplementary Order Paper 61.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000690\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003EBill to be reported with amendment presently.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000691\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003EHouse resumed.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000692\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003EThe Chairperson reported the Reserve Bank of New Zealand Amendment Bill without amendment, and that the Committee had divided it into two bills; the Communications Legislation Bill without amendment, and that the Committee had divided it into two bills; and the Insolvency Law Reform Bill with amendment, and that the Committee had divided it into two bills.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000693\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003EReport adopted.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id2006102448cc89aa42d8413a9092ad53d4c80fbf000694\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003EThe House adjourned at 9.55 p.m.\u003C/span\u003E\u003C/p\u003E\n    \u003C/div\u003E\n  \u003C/body\u003E\n\u003C/html\u003E"