"\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=\u0022id201511106fb25f893e954ed5af8f886e805377f3000001\u0022\u003E\u003Cspan class=\u0022HpsProceedingHeading\u0022 id=\u0022a5bd9ca223ad48aab906bb77acfae486\u0022\u003ETUESDAY, 10 NOVEMBER 2015\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000003\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u002257f8f361ffb64208ae4f5b424490ad1d\u0022\u003ETUESDAY, 10 NOVEMBER 2015\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000002\u0022\u003EMr Speaker took the Chair at 2 p.m.\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000004\u0022\u003EPrayers.\u003C/p\u003E\n    \u003C/div\u003E\n    \u003Cdiv class=\u0022HpsHansard\u0022\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000005\u0022\u003E\u003Cspan class=\u0022HpsProceedingHeading\u0022 id=\u0022312f8454b19b475f91db04b313849f7d\u0022\u003EOral Questions\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000006\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u00227b1ff7a1493445bfa02ae0b8c664fe35\u0022\u003EQuestions to Ministers\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000007\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u002290b4d9364b0f4d1f80b6b03091a8bc6d\u0022\u003EAustralia\u2014Christmas Island Detention Centre\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022106966ef-8cc3-434a-9dbe-dd76b708c2a1\u0022 data-id=\u0022d18eca640e42444f9ee363859fbff2be\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000008\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022106966ef-8cc3-434a-9dbe-dd76b708c2a1\u0022\u003E1. \u003Cspan class=\u0022HpsByToc\u0022 id=\u0022d18eca640e42444f9ee363859fbff2be\u0022\u003EANDREW LITTLE (Leader of the Opposition)\u003C/span\u003E to the Prime Minister: What action, if any, has he taken to follow up on his statement to Malcolm Turnbull regarding New Zealand - born Australian detainees on Christmas Island, \u201CI think, in the spirit of mateship, there should be some compassion shown\u201D?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022 data-id=\u0022ce15fb9abacd47d19be509d463e940dc\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000009\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022ce15fb9abacd47d19be509d463e940dc\u0022\u003ERt Hon JOHN KEY (Prime Minister):\u003C/span\u003E My full statement to Mr Turnbull was: \u201Cwhere someone isn\u2019t the highest risk where someone has a long-term community of interest in Australia, I think in the spirit of mateship, there should be some compassion shown,\u201D. That statement was made with regard to appeals by detainees. Since I met with Mr Turnbull, Ministers Amy Adams and Michael Woodhouse have travelled to Australia and, with my approval, have met with immigration Minister Peter Dutton to get additional information about how Australia is managing the issue. Ministers and officials are working hard to ensure that what I agreed with Prime Minister Turnbull is implemented as soon as possible. Australia has doubled resources to speed up the appeals process. I have made my views very clear to Prime Minister Turnbull, and I continue to receive regular updates on progress. I have asked Minister Adams to follow up with Mr Dutton, and we expect an ongoing dialogue about where things stand.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000010\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022106966ef-8cc3-434a-9dbe-dd76b708c2a1\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00221146c61bf015462d8cf0c4006c6e4972\u0022\u003EAndrew Little\u003C/span\u003E: What representations to Australia has he made in the last 2 days to raise concerns about events on Christmas Island or to offer his help?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000011\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00227533efd7c0a844ed9ce50ac56de8717b\u0022\u003ERt Hon JOHN KEY\u003C/span\u003E: I personally have made none, but, of course, the officials and my Ministers have worked their way through that process.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000012\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022106966ef-8cc3-434a-9dbe-dd76b708c2a1\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00227132066b590241a2ba3813f4b7e9b8ff\u0022\u003EAndrew Little\u003C/span\u003E: Which of his statements of earlier today is correct: his statement to Radio New Zealand that the New Zealand detainees are \u201Cfree to leave\u201D and \u201Care staying there voluntarily\u201D or his statement to reporters that the New Zealand detainees who wanted to leave face many weeks of delays in a remote detention centre before they can go anywhere?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000013\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00229a7a9c5f89fd44e7b894eff4f908d913\u0022\u003ERt Hon JOHN KEY\u003C/span\u003E: For a start, I did not make the last statement. What I did point out was that it depends on the circumstances. In terms of an individual, there are a number of factors that have to be considered: firstly, as I pointed out this morning, whether the person has travel documentation, a passport; secondly, whether the person has a history of violent or criminal activity; thirdly\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000014\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002209a5b71a-ca7e-4e7c-9e09-f9e63f18aa12\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00228043736ec1ec47d499b17fab932b9ba1\u0022\u003EHon Annette King\u003C/span\u003E: You said it was easy.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000015\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022cadaeb5a533d4fdca84f40b5b8ed8725\u0022\u003ERt Hon JOHN KEY\u003C/span\u003E: Well, it is not actually easy, because these people\u2014some of them are rapists, some of them are child molesters, and some of them are murderers. These are the people whom the Labour Party is saying are more important to support than New Zealanders, who deserve protecting when they come back here.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000016\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022802874a3-deca-48b7-9d33-9087058892f5\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002205fb6918412b47069c368858e2f1073c\u0022\u003EKelvin Davis\u003C/span\u003E: A detention centre; not a prison.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000017\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002209237c323b4c406cac5a5cae7815d0d4\u0022\u003ERt Hon JOHN KEY\u003C/span\u003E: Mr Davis, if you want to put yourself on the side of sex offenders, go ahead, my son, but we will defend New Zealanders. [Interruption]\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000018\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b12a143b12d04127abb817f5f496c9c6\u0022\u003EMr SPEAKER\u003C/span\u003E: Order! [Interruption] Order! I am on my feet.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000019\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022106966ef-8cc3-434a-9dbe-dd76b708c2a1\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00224337a466bbc04137be2e089eab6706cf\u0022\u003EAndrew Little\u003C/span\u003E: Given that Britain, Canada, France, Germany, Switzerland, the US, and many other countries all criticised Australia\u2019s treatment of many of the Christmas Island detainees at the UN just yesterday, why did his Government fail to raise any concerns at all about the ill-treatment of New Zealand - born detainees?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000020\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002291c19096be4640d9b73b443dd0852dcd\u0022\u003ERt Hon JOHN KEY\u003C/span\u003E: Because we do not need to go to Geneva to do that; we do it in person with the Prime Minister of Australia. We have done that, and we do it with the Australian Ministers. I say again that we have a responsibility to those New Zealanders, and we will bring them home to New Zealand, but we will do so by protecting New Zealanders. We are not on the side of sex offenders; we are on the side of New Zealanders. [Interruption]\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000021\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022715a98622e87409ab422ead45bd2b511\u0022\u003EMr SPEAKER\u003C/span\u003E: Order! [Interruption] Order! I am attempting to call the Leader of the Opposition for a supplementary question. It requires some silence before I do so.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000022\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022106966ef-8cc3-434a-9dbe-dd76b708c2a1\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022d2ee36e37f1a433f937890b4748f51cd\u0022\u003EAndrew Little\u003C/span\u003E: Why is he so weak that he spends his time with Malcolm Turnbull talking about what ties to wear rather than having the moral courage to demand that Australia do what is right for the detainees?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000023\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00221c91365d5476414fa7924b655f794918\u0022\u003ERt Hon JOHN KEY\u003C/span\u003E: We spent a considerable portion of the one-on-one meeting that we had with Malcom Turnbull talking about this issue. Two Ministers have gone to Australia to talk to Minister Dutton about this issue. I have raised this issue with Prime Minister Abbott. There have been considerable conversations going on. When it comes to these people coming home to New Zealand, they are free to come home, and we will allow them to come home and we will ensure that they can come home as long as they have the travel documentation. They cannot go on a commercial aircraft if they are violent or if they have mental health issues. I have a responsibility to the New Zealanders here at home that they are looked after. What the Labour Party is saying is: \u201CTo hell with the rest of New Zealanders; these people should be put on a commercial aircraft and despatched to New Zealand.\u201D Well, you back the rapists; I\u2014[Interruption]\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000024\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ef1714878be644e18e604da6c1228fd6\u0022\u003EMr SPEAKER\u003C/span\u003E: Order! [Interruption] Order! When I rise to my feet, I expect the Prime Minister to then resume his seat.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000025\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022106966ef-8cc3-434a-9dbe-dd76b708c2a1\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002217f9d1827b644ec89a217d54ca878562\u0022\u003EAndrew Little\u003C/span\u003E: Why has it taken an inmate to die, a 2-day fire, and a full-blown riot for him and his Ministers to finally lift a finger to do something about it?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000026\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022c562183c797c4c9fb91918e8506e5f7b\u0022\u003ERt Hon JOHN KEY\u003C/span\u003E: The member is just completely misrepresenting the facts. I raised this issue in February after it became Australian law in the late part of December. I raised the issue with Malcolm Turnbull all the way through this, and our Ministers have been working on this issue. We cannot stop Australia having its sovereign right to ultimately decide to deport people who are serious criminal offenders. We cannot stop that any more than Helen Clark could stop the fact that back in 2001 a whole category of New Zealanders did not get the right to residency. They are the very people, actually, who, if they had residency and citizenship, would be able to stay.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000027\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022a5f0fe84-01e8-4eb3-a590-0025017c4243\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00223c8e8e35e8344d0d804a961449fba414\u0022\u003EMarama Davidson\u003C/span\u003E: E te M\u0101ngai o Te Whare, t\u0113n\u0101 koe. T\u0113n\u0101 koe e Te Whare. Given that New Zealanders, some of whom are people with disabilities, some of whom are in there merely for an unregistered vehicle, some of whom are in there for driving offences\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000028\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002262403a0e83914130b78cec4a00a62110\u0022\u003EMr SPEAKER\u003C/span\u003E: Order! [Interruption] Order! I will certainly give some leniency to the questioner in that this is her first supplementary question, but we need to get to the question. There were a lot of givens. Maybe one is acceptable, but a whole list of them will not be acceptable. I do need the question.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000029\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022a5f0fe84-01e8-4eb3-a590-0025017c4243\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022d38e009e52794a2891232fe7ee0d9727\u0022\u003EMarama Davidson\u003C/span\u003E: Why did the Government not criticise Australia for its offshore detention centres in our submission on Australia\u2019s human rights record at the UN yesterday?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000030\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00227d5a1231e3524ccba18740af5bb1a1ec\u0022\u003ERt Hon JOHN KEY\u003C/span\u003E: Because we raised it directly with the Australian Prime Minister.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000031\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022a5f0fe84-01e8-4eb3-a590-0025017c4243\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00220320c42a09754d579247448a58984979\u0022\u003EMarama Davidson\u003C/span\u003E: I seek leave to table New Zealand\u2019s submission to the United Nations Human Rights Council on Australia\u2019s appalling human rights record.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000032\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022baef8284dfbf4213a9e4cc57b0fe73a0\u0022\u003EMr SPEAKER\u003C/span\u003E: Can I just check the source of this document?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000033\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022a5f0fe84-01e8-4eb3-a590-0025017c4243\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00226e1352c9d05b4948804391aba7c17cb7\u0022\u003EMarama Davidson\u003C/span\u003E: It is not public as far as I know, and we have searched.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000034\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00225e117b1215464d3590083bc0934941ed\u0022\u003EMr SPEAKER\u003C/span\u003E: I am in a difficult situation. I do not know whether it is public. The member needs to be very careful that she is not misleading the House. If the member says that it is not publicly available, I will put the leave and it will be for the House to decide. I am just going to clarify with the member again whether it is publicly available.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000035\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022a5f0fe84-01e8-4eb3-a590-0025017c4243\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00221848bcc77d23499ab6e54dc1840e4caf\u0022\u003EMarama Davidson\u003C/span\u003E: It is from a journalist, as the source.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000036\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002292c40da0e05d4aabae41d9d1e06b3d43\u0022\u003EMr SPEAKER\u003C/span\u003E: Then I think that it is available to all members.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000037\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022a5f0fe84-01e8-4eb3-a590-0025017c4243\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00229ff5d4ade35b413fbd04bc4d53d4ca4e\u0022\u003EMarama Davidson\u003C/span\u003E: Given Australia\u2019s continued abuse of New Zealanders\u2019 human rights on Christmas Island, is it right for the Prime Minister to support Australia\u2019s bid for a seat on the United Nations Human Rights Council?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000038\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00220764ea1e19924c64934d5c03c072881b\u0022\u003ERt Hon JOHN KEY\u003C/span\u003E: As I said earlier, in terms of any concerns we have, the Government raises those issues directly. We have said for a long period of time that we do not like this policy. This policy is not directed specifically at New Zealanders. It is a policy that they apply to all countries, but, as I said earlier, when it comes to those New Zealanders\u2014who are people, by the way, who do not want to claim to be New Zealanders; the whole point is that they do not want to come back to New Zealand\u2014I have a responsibility to make sure that other New Zealanders are safe. The people who are in those detention centres have a criminal offence that has seen them incarcerated for 1 year or more, or they have serious character issues. If they actually have connection with New Zealand, the advice from the Australian Minister is that a third to a half of all those appeals are being accepted. I am sorry, I am not just going to take people back into New Zealand without information and without being able to protect the New Zealand public, and if those members want to protect sex offenders, rapists, and murderers, go ahead. I am not going to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000039\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226007dc96-f459-4cdd-9972-4fde2c994088\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00225a9bdff8217e43d3bc91b13a77423e35\u0022\u003EGrant Robertson\u003C/span\u003E: I raise a point of order, Mr Speaker. I was going to wait until the end of the question but the Prime Minister has repeated what he said more directly in an earlier supplementary answer when he accused the Labour Party of \u201Cbacking the rapists\u201D. I am deeply offended at that and I ask that it be withdrawn. [Interruption]\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000040\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b70e7a3e8c4d46e18388b85f8839e6bd\u0022\u003EMr SPEAKER\u003C/span\u003E: Order! [Interruption] Order! This is a political debating chamber. The member may well be offended by that, but in the context of the answers given, I am not going to take that as\u2014[Interruption] Order! I do not want to start this week by asking a member to leave the Chamber, but I want to make it absolutely clear that when I am on my feet, there is no opportunity for members to continue to interject, and that applies to both sides of the Chamber.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000041\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00225fae02ba851649f6ba69190a125aa1e5\u0022\u003ERt Hon John Key\u003C/span\u003E: I raise a point of order, Mr Speaker.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000042\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226007dc96-f459-4cdd-9972-4fde2c994088\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00227c5488a62e0f4057bd9b1adbf96af46a\u0022\u003EGrant Robertson\u003C/span\u003E: I raise a point of order, Mr Speaker.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000043\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022a57dd28d869f4d4c9b13914039865d5b\u0022\u003EMr SPEAKER\u003C/span\u003E: I just want to clarify with Grant Robertson that it is a fresh point of order. I will hear from the right honourable Prime Minister first.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000044\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002270e3c756ac224550a279637b824d1d3e\u0022\u003ERt Hon John Key\u003C/span\u003E: I do not have the document with me but in the meeting that I held with Malcolm Turnbull\u2014I am not sure whether I can actually table it; I might be able to\u2014he gave a detailed outline of the people who are in question; the New Zealanders who are going to be deported\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000045\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00220cc962f4bd984a95ab5e1febe0c4cf3b\u0022\u003EMr SPEAKER\u003C/span\u003E: Order! The Prime Minister will resume his seat. That is not a point of order. I have dealt with that matter.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000046\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226007dc96-f459-4cdd-9972-4fde2c994088\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022fbf8cb2da9e84984baea998acb4546d7\u0022\u003EGrant Robertson\u003C/span\u003E: I have taken offence at\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000047\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00223f5dd7421690446c987cca9e17d8bbde\u0022\u003EMr SPEAKER\u003C/span\u003E: Order! [Interruption] Order! On occasions in this House\u2014and I have heard many rulings and I have given some\u2014it is not a matter of whether the member was offended; it is a matter of whether the House was offended. [Interruption] I do not want to see the whole of this left-hand side evacuated. Members may be offended\u2014[Interruption] Order! I have to judge the seriousness of the allegation, and I have determined that the House should not be offended at that. [Interruption] Iain Lees-Galloway, I ask you to leave the Chamber. I can only give so\u2014[Interruption] \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000048\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003EIain Lees-Galloway withdrew from the Chamber. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000049\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022d70572324abc4227b2f9330e70a0aaaa\u0022\u003EMr SPEAKER\u003C/span\u003E: Are there any further\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000050\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221dbd2811-8e58-4ffb-848d-31c0eaa9690a\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ca6a9aecefc04e83a474e4aadc5e63c8\u0022\u003EChris Hipkins\u003C/span\u003E: I raise a point of order, Mr Speaker.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000051\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00222cdf0dd9a07d48c38a3154a3347e915a\u0022\u003EMr SPEAKER\u003C/span\u003E: Order! I will hear it in a minute. [Interruption] Order! I will hear it in a minute when the House settles.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000052\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221dbd2811-8e58-4ffb-848d-31c0eaa9690a\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00227f8187819d3c4c048cbde18fe90ba3e0\u0022\u003EChris Hipkins\u003C/span\u003E: I ask you to reconsider. There is nothing more offensive than being accused of backing rapists\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000053\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b13a1a0029a448a5950017113a600fdc\u0022\u003EMr SPEAKER\u003C/span\u003E: Order! [Interruption] Order! We have covered that matter. If you take the contents of the Hansard\u2014and I will certainly be looking at the Hansard; I give the member that assurance\u2014as I recall the answers given by the Prime Minister, he was saying that the people who are in detention, whom some members of the left-hand side are expressing a great deal of sympathy for, are there for reasons of serious crimes. That is how I took it. Now, we have dealt with the matter. If the members want to continue to stand and relitigate or voluntarily leave, they are welcome to do so. Are there any further supplementary questions?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000054\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022fc8ab326-1806-41d3-8c41-cd58c95dcb45\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00223f990267654e4e79830b45c2657752b1\u0022\u003EMetiria Turei\u003C/span\u003E: I raise a point of order, Mr Speaker.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000055\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022a345294297ba48b5a4cc56e8f0240ab9\u0022\u003EMr SPEAKER\u003C/span\u003E: I will hear it, but if it is\u2014[Interruption] Order! [Interruption] Order! The Hon Gerry Brownlee will also remain quiet while I hear a point of order. Before I accept the point of order, I have dealt with this matter\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000056\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022fc8ab326-1806-41d3-8c41-cd58c95dcb45\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00222b45b19641954fd0b8516938f9e98327\u0022\u003EMetiria Turei\u003C/span\u003E: Dealt with that matter. This is a different matter.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000057\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00228ac6649f6c994ccfaeed89458ca8f0ff\u0022\u003EMr SPEAKER\u003C/span\u003E: Yes. Then, as a fresh point of order, I am happy to hear it\u2014but it had better be.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000058\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022fc8ab326-1806-41d3-8c41-cd58c95dcb45\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022504b303f066240ae87d14539564824d8\u0022\u003EMetiria Turei\u003C/span\u003E: I take offence at the Prime Minister\u2019s accusation that the Green Party, and particularly Marama Davidson as our representative, backs rapists and murderers\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000059\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ac0daa69946140f7a939014ef5e1ccc9\u0022\u003EMr SPEAKER\u003C/span\u003E: Order! [Interruption] Order! You are only relitigating where I have already been.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000060\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c3d9fd88-4715-419d-be08-e1c4eda7d09e\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022f98e0eb38234413990bbcdb386f5f251\u0022\u003EMarama Fox\u003C/span\u003E: What do you say to the family of K\u014D R\u016Btene, who is a decorated soldier, having served for New Zealand in Afghanistan and who has committed no crime in Australia and no crime in New Zealand but who has been detained by the Australian Border Force and is being held in a detention facility in Australia, awaiting deportation?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000061\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022cb77958edd22401ca8b6a6af057d2d2b\u0022\u003ERt Hon JOHN KEY\u003C/span\u003E: I do not have the details of his case.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000062\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022a5f0fe84-01e8-4eb3-a590-0025017c4243\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022cd8ab178c07541fba977f4a9365b4697\u0022\u003EMarama Davidson\u003C/span\u003E: Then will the Prime Minister today rule out supporting Australia\u2019s bid for a seat on the UN Human Rights Council?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000063\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00225f6937c9867a477d877b7ca5ced26ef4\u0022\u003EMr SPEAKER\u003C/span\u003E: I will allow the question. The right honourable Prime Minister was brought in in an earlier supplementary question.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000064\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002250eaa929cd414040a6fba668009e35e6\u0022\u003ERt Hon JOHN KEY\u003C/span\u003E: The Government put in the submission last night, and we continue to support that submission.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000065\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022f9b4c3cac3d24e2eb82b6e624fba241d\u0022\u003EEconomic Programme\u2014Support for Families\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002218f9e3ea-81c5-4414-af48-d6bb843a9227\u0022 data-id=\u0022b408a6b9c9034d0db9396b954471145d\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000066\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002218f9e3ea-81c5-4414-af48-d6bb843a9227\u0022\u003E2. \u003Cspan class=\u0022HpsByToc\u0022 id=\u0022b408a6b9c9034d0db9396b954471145d\u0022\u003EMELISSA LEE (National)\u003C/span\u003E to the Minister of Finance: What steps has the Government taken to move its books from an $18.4 billion deficit to surplus between 2011 and 2015, while still supporting New Zealand families?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022 data-id=\u00220426efcc0eb645f680dbab44dd94b637\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000067\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00220426efcc0eb645f680dbab44dd94b637\u0022\u003EHon BILL ENGLISH (Minister of Finance):\u003C/span\u003E Although money has been tight, we have focused on continuing to support New Zealand\u2019s families and making sure that every dollar we spend goes a long way. That is why we have been able to do things like extend paid parental leave from 14 to 18 weeks, extend free doctors\u2019 visits and prescriptions for children under 13, and raise benefit payments for families with children, which will occur on 1 April next year, while still moving the books from a large deficit to a round balance.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000068\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002218f9e3ea-81c5-4414-af48-d6bb843a9227\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00229d5037008ea24e3c99ba9776f8d4b78f\u0022\u003EMelissa Lee\u003C/span\u003E: What additional support has the Government provided to superannuitant families in particular?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000069\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022fe236495a2664710bed7659068a03dcb\u0022\u003EHon BILL ENGLISH\u003C/span\u003E: The payment for national superannuation is automatically indexed to a combination of the average wage and the consumer price index. Since April 2008 the amount a couple receive in national superannuation has increased from $880 a fortnight to just over $1,150 a fortnight, an increase of over 30 percent. In that time, the cost of living has increased by around 15 percent. So superannuitants have had payments increased at twice the rate of inflation since 2008. We are committed to keeping the retirement age at 65 and ensuring that national superannuation keeps pace with the average wage.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000070\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022106966ef-8cc3-434a-9dbe-dd76b708c2a1\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022d03d4a2941ea4642a4341e63a8bd73f0\u0022\u003EAndrew Little\u003C/span\u003E: No, you\u2019re gilding the lily now\u2014gilding the lily. Can\u2019t tell us straight.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000071\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002288f5c7dda3e8459db38ebd7149a99846\u0022\u003EHon BILL ENGLISH\u003C/span\u003E: Well, it is good to see over the weekend the Labour Party adopting our policy.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000072\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002218f9e3ea-81c5-4414-af48-d6bb843a9227\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022e2e009c642644cc1957ff2653e733e99\u0022\u003EMelissa Lee\u003C/span\u003E: How has the Government been supporting families to get better jobs and earn higher incomes?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000073\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022950b04e21b4d4f2982fd0ca21f5acf48\u0022\u003EHon BILL ENGLISH\u003C/span\u003E: Of course, the job is never done on better jobs and higher incomes, but the average annual wage is now $57,300. That is over $10,000 per annum higher than it was in 2008. Over the last year average wages increased by 3.1 percent, when inflation was just 0.4 percent. Of course, the unemployment rate is higher than we would like it, and the Business Growth Agenda sets out 500 specific policies to assist with more investment and more employment. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000074\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002218f9e3ea-81c5-4414-af48-d6bb843a9227\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002276f223a92d184490b8cb5c9138d5093c\u0022\u003EMelissa Lee\u003C/span\u003E: How has the Government been supporting New Zealanders who cannot get a job? \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000075\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00228a59420c640247c2b9b7c64b9a2fc06e\u0022\u003EHon BILL ENGLISH\u003C/span\u003E: For those who have children, in the last Budget we announced an increase of benefit levels for the first time in 43 years, coming into effect on 1 April 2016. However, we have a very broad and flexible programme through the welfare reform to assist people who do not have jobs. We are now using extensively data that enables us to work out who will benefit most from assistance from the Government, and we have been targeting particular groups such as single teen parents and those who have some disabilities, either of a mental or physical nature, to assist them to get ready to be able to take jobs. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000076\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022820f6bad2c3541ba91dcd25308fbaf74\u0022\u003ESuperannuation\u2014Rates and Age of Eligibility\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002247c29b78-eee0-4c91-afdf-7b07be780e1a\u0022 data-id=\u0022c481c49e715f47a0833ea436ca51936d\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000077\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002247c29b78-eee0-4c91-afdf-7b07be780e1a\u0022\u003E3. \u003Cspan class=\u0022HpsByToc\u0022 id=\u0022c481c49e715f47a0833ea436ca51936d\u0022\u003EDENIS O\u2019ROURKE (NZ First)\u003C/span\u003E to the Minister of Finance: Is he concerned that Massey University has found that the minimum income needed by a single retiree in the main centres is $489.77, when New Zealand Superannuation is only $374.53 per week, and many may have no other means?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022 data-id=\u00226dac6994273940bfb615031608200cd5\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000078\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00226dac6994273940bfb615031608200cd5\u0022\u003EHon BILL ENGLISH (Minister of Finance):\u003C/span\u003E I reject the premise of the question. In fact, the study by Massey University does not report minimum incomes needed, or recommend levels of expenditure. In fact, it quite specifically says that it is not reporting recommended levels of expenditure. There is an annual survey by the Ministry of Social Development of levels of hardship, which shows that levels of hardship among older New Zealanders are low, which is one of the reasons that Parliament supports universal national superannuation. The survey that the member is referring to records the average amount spent by households that are on national superannuation\u2014that is, income from all sources, not recommended minimum expenditure.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000079\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002247c29b78-eee0-4c91-afdf-7b07be780e1a\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022c8d33de507f141eab825917b0e8760d6\u0022\u003EDenis O\u2019Rourke\u003C/span\u003E: How is the Minister planning to address growing elder poverty, given the main drivers of this are the cost of accommodation\u2014especially in the main centres\u2014inflation-busting electricity increases, and inflation-busting rates increases?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000080\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00221fb19889991444aba5be817c4e8e5b03\u0022\u003EHon BILL ENGLISH\u003C/span\u003E: We certainly acknowledge the challenge for some older people of living on a relatively low fixed income for a long time. I think the household expenditure and income survey records that around 40 percent of people over 65 have no income other than their national superannuation. The way that the Government is dealing with it is to fund the significant increases in the weekly national superannuation payment that I referred to in my answer to the last question\u2014that is, while those households do feel the pressure of cost of living increases, in fact, national superannuation over the last 6 years has risen at twice the rate of inflation. So they are in a better position now to deal with those pressures than they used to be.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000081\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227e22bb95-9afb-449c-bcd2-de9fd4f2277c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00223c5d840164f34a0bb104b57f966a69df\u0022\u003EDavid Seymour\u003C/span\u003E: Does the Government face the trade-off between the age of entitlement for New Zealand superannuation and the level of entitlement?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000082\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00220c86b0f796c94c648a68830a032212fc\u0022\u003EHon BILL ENGLISH\u003C/span\u003E: No. We have committed to the policy of keeping the age of entitlement in place and also the current level of entitlement. One of the ways that we are focusing on the long-term ability of New Zealand to pay for that is to deal with all the other long-term liabilities, particularly in our welfare system, where we have people who are on benefit for 20, 25, 30 years. We believe that with a more active, compassionate, and competent welfare State we can get more of those people back into participating in society.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000083\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002247c29b78-eee0-4c91-afdf-7b07be780e1a\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022f078668d7d834d308a9554a34b59120b\u0022\u003EDenis O\u2019Rourke\u003C/span\u003E: Does the Minister accept that the percentage of the average wage on which superannuation is based needs to be substantially increased; if not, why not?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000084\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022d1bca56038014dd9b8040e5d77c1be90\u0022\u003EHon BILL ENGLISH\u003C/span\u003E: No, I do not think it should be increased. We have now had a couple of decades of consensus in Parliament about that particular formula, which has been studied in great detail, and we believe it is about a fair balance of meeting the needs of older people who cannot earn an income, on the one hand, and the ability of the wider community to pay for that in the face of an ageing population. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000085\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002247c29b78-eee0-4c91-afdf-7b07be780e1a\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022e4091fa4063d48f9b528baece7963b74\u0022\u003EDenis O\u2019Rourke\u003C/span\u003E: Why has Mr Fin Heads not received the superannuation back-pay and other compensation he is still being deprived of, despite the Human Rights Review Tribunal finding in his favour and the Government accepting that section 68 in Part 4 of the first schedule to the Accident Compensation Act needs amendment?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000086\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00228f551e07227b45cb98ee04f3699fe7b1\u0022\u003EHon BILL ENGLISH\u003C/span\u003E: I am aware, not of the individual\u2019s circumstances but of the tribunal decision, and I understand that matter is under consideration.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000087\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227e22bb95-9afb-449c-bcd2-de9fd4f2277c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002270792f9511a14ff6b00c93c04a543bb4\u0022\u003EDavid Seymour\u003C/span\u003E: Can the Minister of Finance confirm his earlier answer that, other things being equal, there is no trade-off between the age of entitlement to New Zealand superannuation and the level of entitlement?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000088\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002269462978405742a6a1c32d920c0a8f90\u0022\u003EHon BILL ENGLISH\u003C/span\u003E: Yes, I can confirm the Government policy, which is to maintain the age of eligibility at 65 and to maintain the current level of payment. When we look out ahead over the ability of the economy to pay for that, one of the ways we can ensure that is, of course, a more flexible, productive economy, and the other is to deal with the other long-term liabilities such as the welfare spending and also control of health spending. In both of those areas we have shown some progress in being able to control spending. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000089\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002247c29b78-eee0-4c91-afdf-7b07be780e1a\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b9cd702afcaf499eb955e88c1392f1ef\u0022\u003EDenis O\u2019Rourke\u003C/span\u003E: When will the Government next review New Zealand superannuation, and can he assure superannuitants and those close to retirement that it will meet their actual needs while also fixing the other obvious injustices and inadequacies?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000090\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00220c69457c766b47f4a7ebf150dbaa1612\u0022\u003EMr SPEAKER\u003C/span\u003E: The Hon Bill English\u2014either of those two supplementary questions.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000091\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00227c967e2e15504b919231dd2920ec0115\u0022\u003EHon BILL ENGLISH\u003C/span\u003E: We are always willing and open to deal with issues that the member might characterise as \u201Cinjustice\u201D\u2014as, I understand, in the case he was referring to earlier\u2014but generally we think the settings are about right. There has been much discussion for a long time about national superannuation in New Zealand, and New Zealand First should take credit for winning a number of arguments over the last 15 or 20 years about national superannuation. We believe those arguments are largely settled and should remain so.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000092\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022130b8013d716452191e0826a32250041\u0022\u003EJob Creation and Employment\u2014Statistics and Policies\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022106966ef-8cc3-434a-9dbe-dd76b708c2a1\u0022 data-id=\u0022eaa6c4ff828a4e20ad43003b3da7afdd\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000093\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022106966ef-8cc3-434a-9dbe-dd76b708c2a1\u0022\u003E4. \u003Cspan class=\u0022HpsByToc\u0022 id=\u0022eaa6c4ff828a4e20ad43003b3da7afdd\u0022\u003EANDREW LITTLE (Leader of the Opposition)\u003C/span\u003E to the Prime Minister: When he said that New Zealand is on the \u201Ccusp of something special\u201D, did he mean 6 percent unemployment and 11,000 jobs lost in the last quarter?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022 data-id=\u00227387270ade0c475fb936db7ca83e64e9\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000094\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00227387270ade0c475fb936db7ca83e64e9\u0022\u003ERt Hon JOHN KEY (Prime Minister):\u003C/span\u003E Actually, in retrospect, I was referring to things like the Government getting the books back into surplus, concluding a free-trade agreement covering 40 percent of the world\u2019s economy, seeing the record levels of tourism, creating an ocean sanctuary in the Kermadecs, giving under-13s free doctors visits, signing a free-trade agreement with Korea, and joining the World Trade Organization Government procurement agreement to give New Zealand firms access to $1.7 trillion of potential Government contracts. All of these things will help New Zealand to succeed as a prosperous trading nation, not just this year but well out into the future.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000095\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022106966ef-8cc3-434a-9dbe-dd76b708c2a1\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00226c7e1b92c7044a78ba0016968ab013c2\u0022\u003EAndrew Little\u003C/span\u003E: How can he be surprised that he has lost 11,000 jobs in the last 3 months when he refuses to back Kiwi jobs when spending $39 billion of taxpayers\u2019 money?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000096\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022c6f562cb109949f3ae7e5c90a6b1a78d\u0022\u003ERt Hon JOHN KEY\u003C/span\u003E: One of the fastest ways to back Kiwi jobs would be to say that the member would support the Government in signing a free-trade agreement with 40 percent of the global economy, which sees a 93 percent elimination of tariffs and is worth nearly $3 billion to New Zealand.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000097\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022106966ef-8cc3-434a-9dbe-dd76b708c2a1\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00220cc8f533abb64970b85b263eb2d0709a\u0022\u003EAndrew Little\u003C/span\u003E: Why does his Government not make job creation in New Zealand a priority when spending $39 billion of taxpayers\u2019 money?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000098\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002221aa509736244a5cab6d7dd914873de8\u0022\u003ERt Hon JOHN KEY\u003C/span\u003E: It is a priority, and that is why over the last 3 years the number of working people has gone up by 160,000 and the number of people out of work has gone down by 19,000. We have one of the higher levels of employment\u2014one of the higher levels of participation\u2014around the developed world.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000099\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00228a1cb04e-8a86-44d1-9004-6e158e220339\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00223be9d5e8ff6d498ba0de0dcbdfba649b\u0022\u003ETim Macindoe\u003C/span\u003E: What steps is the Government taking to support more jobs and higher incomes?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000100\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022f07bb490d7d545d29aff0c7956d0a9de\u0022\u003ERt Hon JOHN KEY\u003C/span\u003E: Firstly, it is important to understand that the Government does not create jobs; businesses do that. We have taken several steps to help them do that. For example, we have reduced tax on work to encourage more jobs and increase take-home pay; we have introduced a 90-day trial to encourage businesses to hire new staff; we are controlling Government expenditure, which helps to keep pressure off interest rates; and we have negotiated New Zealand\u2019s biggest trade deal, the Trans-Pacific Partnership, to support more jobs and diversify the economy. Every one of these measures has a common theme: they were all opposed by the Labour Party.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000101\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022106966ef-8cc3-434a-9dbe-dd76b708c2a1\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00227388f2f2634a4bcea738e4ed6c689759\u0022\u003EAndrew Little\u003C/span\u003E: Does he agree with Steel Construction New Zealand that the \u201Cinevitable outcome\u201D of his Government\u2019s approach to procurement is that \u201Clocal industry is disadvantaged\u201D, and is that why the Glenbrook steel mill may now need to cut 1,000 Kiwi jobs?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000102\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022289564530428449ba95cb00c10d0b321\u0022\u003ERt Hon JOHN KEY\u003C/span\u003E: I do not think either of those statements is correct. In fact, if the member looks at the Trans-Pacific Partnership, what it does do is open up much greater and less protected access to New Zealand companies to procurement all around the world for Government contracts as part of the Trans-Pacific Partnership. We encourage New Zealand companies to be involved, and we have done lots of things. The Inland Revenue Department\u2019s new computer system has been divided in a way that will make it much more accessible for Kiwis to actually get a chance for that.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000103\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00228a1cb04e-8a86-44d1-9004-6e158e220339\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00222d837763ca6a4e18935eddce64b723f9\u0022\u003ETim Macindoe\u003C/span\u003E: How has the New Zealand labour market responded to improving economic conditions over the past 3 years?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000104\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022e22de8ffd74d456d86b6668d3f547f9d\u0022\u003ERt Hon JOHN KEY\u003C/span\u003E: In the last 3 years alone the number of working people has gone up by 160,000. The number of people out of work has gone down by 19,000. The labour force participation rate has increased strongly and, at 68.6 percent, remains near record levels. The unemployment rate has dropped by 1.2 percentage points, and the average wage has increased by around about 8 percent, compared with inflation of under 3 percent. So overall the labour markets have improved, leaving more New Zealanders in jobs and, on average, with higher incomes.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000105\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022106966ef-8cc3-434a-9dbe-dd76b708c2a1\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00229354ac4c5d0943b9b7698dfc5b27b502\u0022\u003EAndrew Little\u003C/span\u003E: Why does he not stop being so gutless and failing New Zealanders and stand up for New Zealanders on Christmas Island and the 151,000 who are now out of work under his Government?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000106\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220083bcaa-f44d-4b70-97de-d091a209b88c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022c03c6bfbba8d4464851f1d4016474be9\u0022\u003ERt Hon JOHN KEY\u003C/span\u003E: We do stand up for people and their rights, but we also have a responsibility to protect New Zealanders. The record, as I have just read out, stands for itself. In the last 3 years 160,000 more people are in work. I know that is very inconvenient for the Labour Party\u2014it did not quite fit in with the speech on Sunday\u2014but, actually, more New Zealanders are in work than before.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000107\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u002290ae77b714b5498683ca3c451407e344\u0022\u003ERegional Economies\u2014Bay of Plenty\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022fdb01002-a7cf-4a77-8f05-678d24a36849\u0022 data-id=\u00222bf9276ed14443c8a09ca533d79a2b21\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000108\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022fdb01002-a7cf-4a77-8f05-678d24a36849\u0022\u003E5. \u003Cspan class=\u0022HpsByToc\u0022 id=\u00222bf9276ed14443c8a09ca533d79a2b21\u0022\u003ETODD MULLER (National\u2014Bay of Plenty)\u003C/span\u003E to the Minister for Economic Development: How is the Government helping to grow regional economies like the Bay of Plenty?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00224a244152-977c-48d2-bf53-4f3a369a27a9\u0022 data-id=\u00229998fc93e23b44dbb0a4ef45a7e20b63\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000109\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00224a244152-977c-48d2-bf53-4f3a369a27a9\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00229998fc93e23b44dbb0a4ef45a7e20b63\u0022\u003EHon STEVEN JOYCE (Minister for Economic Development):\u003C/span\u003E In the last adjournment, alongside my colleagues Simon Bridges, Anne Tolley, and Te Ururoa Flavell, I launched the Toi Moana Bay of Plenty Economic Action Plan, a set of key initiatives prepared by central government, local government, and business leaders locally that will help to lift employment incomes and investment across the Bay of Plenty. It identifies nine priority work areas across the wider region, in areas like agribusiness, agriculture, forestry and wood processing, geothermal, horticulture, M\u0101ori land utilisation, the visitor economy, and water management. The Bay of Plenty region is now growing well as a result of the recovery from the kiwifruit Psa crisis and the rapidly growing tourism industry. This action plan will help to ensure the growth is maintained and extended to all parts of that region.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000110\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022fdb01002-a7cf-4a77-8f05-678d24a36849\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00220cd724d8bb5049ed96676022720fafd5\u0022\u003ETodd Muller\u003C/span\u003E: What initiatives and opportunities are identified in the action plan to promote growth in the Bay of Plenty?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000111\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00224a244152-977c-48d2-bf53-4f3a369a27a9\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00229f0f5651e12d4cf8b2690101c5ce8ca7\u0022\u003EHon STEVEN JOYCE\u003C/span\u003E: A number of things. For example, in agribusiness the action plan sets out a programme to expand m\u0101nuka honey production to help meet an increasing global demand for high unique m\u0101nuka factor grade m\u0101nuka honey. In horticulture, the report lays out a plan including additional training, irrigation, and water use, and unlocking M\u0101ori land to grow the kiwifruit industry further, particularly in the Eastern Bay of Plenty. In the visitor economy, the action plan identifies the potential of more cycleways to further grow tourism. And in aquaculture, the action plan identifies the \u014Cp\u014Dtiki sea farm and harbour development as a potential significant growth opportunity. The Government agrees, and that is why we are funding up to $3 million to finalise the geotechnical investigations and the design options for the new harbour entrance in \u014Cp\u014Dtiki.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000112\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022fdb01002-a7cf-4a77-8f05-678d24a36849\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022f7a223c0d7734f01979685bbffb7ad78\u0022\u003ETodd Muller\u003C/span\u003E: What else is the Government doing to help grow regional economies?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000113\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00224a244152-977c-48d2-bf53-4f3a369a27a9\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002284979a738000418b84a346fc718b739f\u0022\u003EHon STEVEN JOYCE\u003C/span\u003E: In addition to the Bay of Plenty action plan and regional growth study, we launched similar programmes in Northland last year, Manawat\u016B, Whanganui, and the East Coast to help them make the most of their opportunities, encourage investment, and grow jobs. We are investing in critical infrastructure like ultra-fast and rural broadband and national and regional roading projects. We are rolling out the regional business partners network and regional business hubs to make it easier for businesses to access the help they need. We are establishing regional research institutes, and, of course, we are signing significant international trade agreements like the Trans-Pacific Partnership and the Korean free-trade agreement, which give exporters in our regions more access to major international markets and grow more jobs. [Interruption]\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000114\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022371c928dd7bf40c99c46b73449bb6e34\u0022\u003EMr SPEAKER\u003C/span\u003E: Order! [Interruption] Order! We will have the general debate tomorrow.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000115\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u002245d87332def04fb4a8100c38112f1fdf\u0022\u003EHousing, Auckland\u2014Auckland Housing Accord and Building Consents\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022 data-id=\u0022500c4bbc40a5483c9eac4a2dd006065b\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000116\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003E6. \u003Cspan class=\u0022HpsByToc\u0022 id=\u0022500c4bbc40a5483c9eac4a2dd006065b\u0022\u003EPHIL TWYFORD (Labour\u2014Te Atat\u016B)\u003C/span\u003E to the Minister for Building and Housing: Does he agree with the New Zealand Herald that it is no surprise his Auckland housing accord has been a flop?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022e978865e-57e5-41d6-a7f6-b49daae78630\u0022 data-id=\u00223834d53cd86c4079bcf43892e6204687\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000117\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e978865e-57e5-41d6-a7f6-b49daae78630\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00223834d53cd86c4079bcf43892e6204687\u0022\u003EHon Dr NICK SMITH (Minister for Building and Housing):\u003C/span\u003E No, I do not agree with that editorial. But I do agree with the editorial in the Dominion Post today, describing Labour as a corpse and a policy desert, and a little party lacking leadership or any new\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000118\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022e508418299d74f8b968bc669fe69ef9c\u0022\u003EMr SPEAKER\u003C/span\u003E: Order!\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000119\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ce2dc4465f1f464288a6ddadf0d5b950\u0022\u003EPhil Twyford\u003C/span\u003E: How many houses have been built in his special housing areas in the 2 years since his housing accord was signed?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000120\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e978865e-57e5-41d6-a7f6-b49daae78630\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022953e1b7248774bfab8c2da0edd524e88\u0022\u003EHon Dr NICK SMITH\u003C/span\u003E: There have been 8,700 homes consented in Auckland over the last year. There have been 2,049 consents\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000121\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022782c130c6a734968bae1e1f132be7072\u0022\u003EPhil Twyford\u003C/span\u003E: I raise a point of order, Mr Speaker. The question was very explicitly\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000122\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002264bdafae5ae34aeaa991d67a8bd756a3\u0022\u003EMr SPEAKER\u003C/span\u003E: Order! I agree with that. I am hoping it will be answered. Let us wait for the end of the answer, and then we will make a decision. Does the Minister wish to add to his answer?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000123\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e978865e-57e5-41d6-a7f6-b49daae78630\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022fe34002b7b0a4679b1f316ff81921fe3\u0022\u003EHon Dr NICK SMITH\u003C/span\u003E: There have been 2,049 building and resource consents issued in those special housing areas. We will not have accurate data on the number of houses completed because that is only collected through the census.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000124\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00227ce2540df5314848912e8fbaf3b8a784\u0022\u003EPhil Twyford\u003C/span\u003E: Does he agree with the New Zealand Herald, which said that at least 25,000 new houses should be built or nearing completion by now if his 3-year target is to be met, and that the tally of 102 houses completed and known to the council is \u201Cpitiful\u201D?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000125\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e978865e-57e5-41d6-a7f6-b49daae78630\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022fc2a71cd3ff7491ba142fe61c9e5507d\u0022\u003EHon Dr NICK SMITH\u003C/span\u003E: The number of 102 is a nonsense. It counts houses in only two of 97 special housing areas, and even there that is not correct. What is more, the housing accord always said that it counted consents over all of Auckland. That number is currently standing at 19,921, and is 1,000 ahead of the same time the accord projected.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000126\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022758dcaf3-9976-43ac-8593-79f66ee4da22\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022bc4f44062b404fbfac9a0163f053e9c5\u0022\u003EJoanne Hayes\u003C/span\u003E: Why does the Minister have confidence that the building consent data can be relied upon as an accurate measure of how many houses are actually built?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000127\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e978865e-57e5-41d6-a7f6-b49daae78630\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022e89a20c47b3446f6b676ae30aee4a994\u0022\u003EHon Dr NICK SMITH\u003C/span\u003E: The reason I have confidence that the building consent data is reliable is that it almost perfectly matches the census data on the number of new houses. For instance, between 2006 and 2013, 32,600 homes were consented in Auckland, and the census showed that over the same period there were 33,000 new homes. If we compare all of the census data since 1991, the correlation between consents and new homes is better than 98 percent. Furthermore, it makes common sense. Who is going to spend $15,000 on getting a building consent if they do not actually intend to get on and build a house within the 12-month period that the consent is valid?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000128\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00226b525a0cf73b4c84be5875bb8b263cb4\u0022\u003EPhil Twyford\u003C/span\u003E: Why does he continually boast that the consenting rate on his watch is better than it was in the depths of the global financial crisis, when the industry all but collapsed, and why does he not admit that the current consenting rate means that the shortfall of houses built up under this Government is getting bigger by 4,500 every year?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000129\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e978865e-57e5-41d6-a7f6-b49daae78630\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002215c3296f079e4211bd1c51f085ef7ee3\u0022\u003EHon Dr NICK SMITH\u003C/span\u003E: The number of consents issued in Auckland in the 2008-09 year was 3,400. The number of consents that have been issued in the last year is 8,700. That shows you the phenomenal growth that has occurred since the disaster that the previous Government left. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000130\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022f86920eb952f4e2e82eca66fd59efadd\u0022\u003EPhil Twyford\u003C/span\u003E: How humiliating was it to have his finance Minister say that the Auckland housing market is \u201Ca major risk to the economy?\u201D, after 7 years in Government and nearly 3 years while he has been Minister, and is that not an admission that his housing policy has been a total failure?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000131\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e978865e-57e5-41d6-a7f6-b49daae78630\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ad8011fd61f54d69aafd5abe477bcf7d\u0022\u003EHon Dr NICK SMITH\u003C/span\u003E: Over the years that I have been Minister the rate of house build growth in Auckland is faster than at any period in Auckland\u2019s history. It is true that the challenges go on, for this reason: during the previous Government we had 40,000 Kiwis leaving for Australia each year. They are not leaving, they are coming home, and that is putting more pressure on the housing market, and that is why we need to keep the foot on the accelerator.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000132\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022758dcaf3-9976-43ac-8593-79f66ee4da22\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00228ed4d81bef1244c4aa70c11d1ca973cf\u0022\u003EJoanne Hayes\u003C/span\u003E: What consideration has the Minister given to the proposal of the infrastructure for new housing being funded by council debt and repaid by way of specially targeted rates on new housing development, rather than the infrastructure costs being included in the price of a section?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000133\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e978865e-57e5-41d6-a7f6-b49daae78630\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022e445c42f89354d0a8e1c510eb66017fb\u0022\u003EHon Dr NICK SMITH\u003C/span\u003E: Such an approach is just creative accounting and will make no real difference to the affordability of housing. It just transfers the cost from the homeowner\u2019s mortgage to the homeowner\u2019s rates bill. For instance, if the infrastructure cost is $30,000, that would mean that they would pay $1,500 less in their mortgage, but they would pay $1,500 a year more in terms of the specially targeted rate. Claims that such an approach is groundbreaking and would reduce new housing costs are nothing more than fool\u2019s gold.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000134\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022f42a6717935b443eab6a33bcec72f79f\u0022\u003ESIS\u2014Visual Warrants and Legislative Compliance\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022fc8ab326-1806-41d3-8c41-cd58c95dcb45\u0022 data-id=\u0022bd72bcd4d84a471983eff13aa5aad028\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000135\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022fc8ab326-1806-41d3-8c41-cd58c95dcb45\u0022\u003E7. \u003Cspan class=\u0022HpsByToc\u0022 id=\u0022bd72bcd4d84a471983eff13aa5aad028\u0022\u003EMETIRIA TUREI (Co-Leader\u2014Green)\u003C/span\u003E to the Minister in charge of the NZ Security Intelligence Service: Does he stand by all of his answers to Oral Question No. 2 on 5 November 2015?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022 data-id=\u0022bee9151594784fef9a5f4f35ebe70f62\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000136\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022bee9151594784fef9a5f4f35ebe70f62\u0022\u003EHon CHRISTOPHER FINLAYSON (Minister in charge of the NZ Security Intelligence Service):\u003C/span\u003E Yes, although in response to a supplementary question from James Shaw asking when I was first made aware that the New Zealand Security Intelligence Service had not provided a copy of two visual warrants to the inspector-general, I replied: \u201CFrom memory, about a fortnight before the inspector-general released her report.\u201D I have now checked the exact date. I can advise the House I was made aware on 28 October 2015.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000137\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022fc8ab326-1806-41d3-8c41-cd58c95dcb45\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022d9a77c5bc20f4e708c6d2f75a859854c\u0022\u003EMetiria Turei\u003C/span\u003E: Given that the New Zealand Security Intelligence Service Act explicitly states that the director must provide copies of visual surveillance warrants to the inspector-general, does he believe that Rebecca Kitteridge breached the law by not doing so?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000138\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022cffb468708dd4afa8152a2499be52910\u0022\u003EHon CHRISTOPHER FINLAYSON\u003C/span\u003E: What I certainly believe is that the New Zealand Security Intelligence Service did not comply with a reporting requirement in the legislation, but I also need to say to the House that the inspector-general has not raised any issues regarding the propriety or the lawfulness of the warrants themselves. Both the director and the commissioner, and I, all read, reviewed, and approved the warrants for issue in our respective capacities. The failure was the failure to comply with a reporting requirement.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000139\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022fc8ab326-1806-41d3-8c41-cd58c95dcb45\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00224cb71572ec2248828830ba4b1fd69d10\u0022\u003EMetiria Turei\u003C/span\u003E: On what date did the Minister first review the two visual surveillance warrants?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000140\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00221ebfd01842ee44dd9cc4213a15f54cde\u0022\u003EHon CHRISTOPHER FINLAYSON\u003C/span\u003E: I do not carry that level of detail around in my head, and even if I did, I would not say, because that would be a sensitive issue that could give rise to issues about who was being surveilled.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000141\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022fc8ab326-1806-41d3-8c41-cd58c95dcb45\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022c351d86dc9c749bc82bcc659645741c9\u0022\u003EMetiria Turei\u003C/span\u003E: After the Minister approved the two visual surveillance warrants, did he immediately follow up with the director to ensure that she had a plan to send those warrants to the inspector-general?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000142\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00226763648b00f74e80aa3657a42513a29d\u0022\u003EHon CHRISTOPHER FINLAYSON\u003C/span\u003E: I do not think the member understands the procedure. I do not approve warrants. The director makes an application to me. The Commissioner of Security Warrants and I both look at the matter and then sign them out. In answer to the particular question\u2014\u201CDid I say \u2018Has the reporting requirement been complied with?\u2019 \u201D\u2014no. I would regard that as an operational issue. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000143\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022fc8ab326-1806-41d3-8c41-cd58c95dcb45\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b725f64049344baf81c395e3c87f4365\u0022\u003EMetiria Turei\u003C/span\u003E: Why did he not follow up with the director to ensure she had followed the reporting requirements in his new legislation over the many weekly meetings he had between signing off on those visual warrants and being finally told that the reporting had not been done?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000144\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022c0698a09e486487984f398cbc7c12626\u0022\u003EHon CHRISTOPHER FINLAYSON\u003C/span\u003E: I do not think the member listened to the previous answer. I regard compliance with reporting operations as being an operational matter. I have every confidence in the director to attend to those matters. She is now putting in place steps to ensure that there is no repeat of this failure to comply with a reporting issue. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000145\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022fc8ab326-1806-41d3-8c41-cd58c95dcb45\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00221cc537089413475082cc97b51409bc0e\u0022\u003EMetiria Turei\u003C/span\u003E: On what basis does the Minister have confidence in the director, when for a number of months during which she had weekly meetings with him she failed to advise him that she had not completed the reporting requirements set out in new legislation that he had passed just a few months before? \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000146\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00220422d6fe86f644dfa988fca5cdc01369\u0022\u003EHon CHRISTOPHER FINLAYSON\u003C/span\u003E: That is not the correct chronology. The director advised me that she first became aware of the issue on 19 October. When we had our first regular meeting after Labour Weekend, she pointed out the issue to me, she apologised\u2014as I said in answer to a question from Mr Shaw last week\u2014and she has put in place steps to ensure that this reporting requirement is complied with in the future. That is what I expect of her. She is a very competent and trustworthy person, and I expect that this will be done. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000147\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022fc8ab326-1806-41d3-8c41-cd58c95dcb45\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002238018ca76f844d3f806a333e93d5b7de\u0022\u003EMetiria Turei\u003C/span\u003E: How can the public have any faith in his statements of the competence and trustworthiness of the director when she did not give the inspector-general copies of the warrants, as she was required to under his new legislation, and she failed to tell him about that failure over many months of weekly meetings, or does he blame himself, given he failed to follow up and check that the law had been complied with?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000148\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002241146229-4d11-415b-a4ac-f4e2b923e95d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022f4c00ec7f005432aaa05f43c32ff1085\u0022\u003EHon CHRISTOPHER FINLAYSON\u003C/span\u003E: The member is choosing to create a narrative to make this into a first-grade federal crime. The fact of the matter is it was a failure to report to the inspector-general. As soon as the director found out about it, she told me, and has put in place steps. I ask the honourable member to bear in mind that the propriety of the warrants and the steps taken to see that the warrants were properly executed were all complied with under the law. This was a reporting requirement.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000149\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u00221bf79a10026c4e20aff91bfa6da11dc9\u0022\u003EHousing, Auckland\u2014Building Consents and Reports\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022695678cf-542a-4616-9e0a-86990caec192\u0022 data-id=\u002211b022bf773c4ee384e0f79df95467cb\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000150\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022695678cf-542a-4616-9e0a-86990caec192\u0022\u003E8. \u003Cspan class=\u0022HpsByToc\u0022 id=\u002211b022bf773c4ee384e0f79df95467cb\u0022\u003EALFRED NGARO (National)\u003C/span\u003E to the Minister for Building and Housing: Can he confirm that the number of building consents issued for homes in Auckland over the last year is at a 10-year high, and can he advise what increases have been achieved in each of the last four years?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022e978865e-57e5-41d6-a7f6-b49daae78630\u0022 data-id=\u00221dbe264477834a208f8b801b52ee1cf5\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000151\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e978865e-57e5-41d6-a7f6-b49daae78630\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00221dbe264477834a208f8b801b52ee1cf5\u0022\u003EHon Dr NICK SMITH (Minister for Building and Housing):\u003C/span\u003E Yes, 8,700 building consents were issued in Auckland in the last year, and this is the highest for more than a decade. The annual rate of growth in Auckland house build rates over the past 4 years has been 18 percent, 31 percent, 28 percent, and then 27 percent, in each of those last 4 years. This is the fastest and longest sustained growth in Auckland since records began. There were 2 years of growth over 15 percent in 2002 and 2003, and 2 years in 1993 and 1994, but, never before, 4 years of year-on-year growth over 15 percent.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000152\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022695678cf-542a-4616-9e0a-86990caec192\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022098e137545b74d13ab370b3f227810f7\u0022\u003EAlfred Ngaro\u003C/span\u003E: Does the Minister have any other economic data alongside the building consent numbers that supports the picture of rapid construction growth in Auckland?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000153\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e978865e-57e5-41d6-a7f6-b49daae78630\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00224fce285314744c12b653451eac2136ff\u0022\u003EHon Dr NICK SMITH\u003C/span\u003E: Yes, I do. All of the relevant data points to a construction boom. The labour force figures from Statistics New Zealand show the number of people employed in construction has gone from 45,000 to 75,000. That is the highest number ever, and, with an additional 30,000 people in Auckland working in construction, shows the pressure we also have to ensure that the quality of building work is maintained. We also have the value of residential building work. That has gone from $1.4 billion per year to $3.5 billion per year. We have the AECOM National Construction Pipeline Report, which shows that 80,000 new homes in Auckland are to be built over the next 5 years, compared with 30,000. The last figure I would draw the House\u2019s attention to I accept is crude but is an international measure, and that is the skyline crane count, which is currently in Auckland at 79, which is also an all-time high.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000154\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022695678cf-542a-4616-9e0a-86990caec192\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00220ce1217f782b457593db83f97bfdc171\u0022\u003EAlfred Ngaro\u003C/span\u003E: Have any independent estimates been made of the number of houses expected to be constructed in Auckland in this parliamentary term, and how do they compare with other previous Parliaments?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000155\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e978865e-57e5-41d6-a7f6-b49daae78630\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002239b7001ca9f949b199a3f30835f9cc98\u0022\u003EHon Dr NICK SMITH\u003C/span\u003E: The National Construction Pipeline Report is produced by AECOM and is based on both actual building consents issued and the forward projections, based on the number of subdivisions that have been approved. It projects 36,000 homes being built in Auckland during this parliamentary term. That compares with 17,000 in the last parliamentary term\u2014so, more than double\u2014and that 36,000 would actually be an all-time record of more houses built in Auckland during the term of this Parliament than any other Parliament in the history of this country.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000156\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022587767d54b964e11b6783e457eec38a7\u0022\u003ESerco\u2014Staff Training\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022802874a3-deca-48b7-9d33-9087058892f5\u0022 data-id=\u00222e34c727416341268e0de5d1b269a538\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000157\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022802874a3-deca-48b7-9d33-9087058892f5\u0022\u003E9. \u003Cspan class=\u0022HpsByToc\u0022 id=\u00222e34c727416341268e0de5d1b269a538\u0022\u003EKELVIN DAVIS (Labour\u2014Te Tai Tokerau)\u003C/span\u003E to the Minister of Corrections: Does he have confidence in Serco\u2019s ability to train its prison staff; if so, why?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002219bcf2ff-a193-4361-9072-813a4e36683c\u0022 data-id=\u002298a40e2e2aa94ef982ea2411907277a6\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000158\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002219bcf2ff-a193-4361-9072-813a4e36683c\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002298a40e2e2aa94ef982ea2411907277a6\u0022\u003EHon Peseta SAM LOTU-IIGA (Minister of Corrections):\u003C/span\u003E There are a number of issues to do with Serco under review at the moment, and my ongoing confidence will be dependent on the outcome of that review. I expect the Department of Corrections to hold Serco to account for the terms of its contracts\u2014that includes the necessary training for staff, required under legislation.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000159\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022802874a3-deca-48b7-9d33-9087058892f5\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002211a5b7d7ef214eaab282543a6c419448\u0022\u003EKelvin Davis\u003C/span\u003E: Does he think it acceptable that after 2 years Serco has still failed to meet the standards set out by the New Zealand Qualifications Authority when training prison staff?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000160\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002219bcf2ff-a193-4361-9072-813a4e36683c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022052d1ea7fa964dc19adda8630384118f\u0022\u003EHon Peseta SAM LOTU-IIGA\u003C/span\u003E: My understanding of the New Zealand Qualifications Authority report is that 100 percent of those at Auckland South Corrections Facility and 95 percent of those at Mt Eden Corrections Facility had completion rates to qualify as corrections officers, as required by the law.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000161\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022802874a3-deca-48b7-9d33-9087058892f5\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022c445ca3a14084a2a9dc5637e4aa1a32b\u0022\u003EKelvin Davis\u003C/span\u003E: What sort of employer has his Government contracted that sends its staff into dangerous situations without proper training and then wonders why there are fight clubs and contraband?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000162\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002219bcf2ff-a193-4361-9072-813a4e36683c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002204ec09bdfabe4df88ecbd9e390b1f027\u0022\u003EHon Peseta SAM LOTU-IIGA\u003C/span\u003E: As I have said in this House already, those allegations are currently under review. I am awaiting the findings of that review, and until we receive those, I cannot make conclusions from that.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000163\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4c55324-cd76-4323-a6a2-1408a110a862\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022582338c74ddd4fc08d9db857b3fc43f3\u0022\u003EMahesh Bindra\u003C/span\u003E: What training support does the Department of Corrections provide to Serco; and who pays for it?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000164\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002219bcf2ff-a193-4361-9072-813a4e36683c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022343d6088bd354e2db67ebb5936ed14f8\u0022\u003EHon Peseta Sam Lotu-Iiga\u003C/span\u003E: I am sorry. Can you just repeat that question?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000165\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00227f932ee0f1c0428fb527ab711ea39f2b\u0022\u003EMr SPEAKER\u003C/span\u003E: Would the member please repeat the question.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000166\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4c55324-cd76-4323-a6a2-1408a110a862\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022e15623e56193426cb34f77577fe31032\u0022\u003EMahesh Bindra\u003C/span\u003E: I raise a point of order, Mr Speaker. I am happy to repeat the question and simplify the question to suit the Minister\u2019s level of understanding.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000167\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00220c0f80cd7372418896410eca858d78bd\u0022\u003EMr SPEAKER\u003C/span\u003E: Order! That is the sort of behaviour\u2014[Interruption] Order! That is the sort of behaviour that brings the House into disrepute. Would the member\u2014[Interruption] Order! Would the member repeat the first question as asked.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000168\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4c55324-cd76-4323-a6a2-1408a110a862\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022eeb843c163a743caa99d0691729b0def\u0022\u003EMahesh Bindra\u003C/span\u003E: What training support does the Department of Corrections provide to Serco; and who pays for it?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000169\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002219bcf2ff-a193-4361-9072-813a4e36683c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b4099e30302a4e49ac59383db8681488\u0022\u003EHon Peseta SAM LOTU-IIGA\u003C/span\u003E: According to the New Zealand Qualifications Authority report, there is no support in terms of the Serco New Zealand Training Limited services that are provided to Serco.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000170\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022802874a3-deca-48b7-9d33-9087058892f5\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002284a3bae3fadb47daa90ab91f4dca094f\u0022\u003EKelvin Davis\u003C/span\u003E: Why did he refuse to front up to Kiwis and give comment to media on this story yesterday?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000171\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002219bcf2ff-a193-4361-9072-813a4e36683c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022decf9b7922aa4211a782a52c770d4079\u0022\u003EHon Peseta SAM LOTU-IIGA\u003C/span\u003E: Well, I front up to Kiwis every day, so I do not know what that member is talking about.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000172\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022dad6f8988d644fb5a997fbaa0db7d29d\u0022\u003EEmergency Services\u2014111 Calls and Mobile Black Spots\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022ebb4ac6b-662b-498f-a27f-832d054e6585\u0022 data-id=\u00229c7616c8fa0147e0810897d02cefb827\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000173\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022ebb4ac6b-662b-498f-a27f-832d054e6585\u0022\u003E10. \u003Cspan class=\u0022HpsByToc\u0022 id=\u00229c7616c8fa0147e0810897d02cefb827\u0022\u003ERIA BOND (NZ First)\u003C/span\u003E to the Minister for Communications: Does she have confidence that all New Zealanders have ready access to the 111 emergency call service; if so, why?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022dc6c0f88-e781-476d-bca1-d1bf9b69302b\u0022 data-id=\u00224a24496211f44e7dbdea4a0143e1467f\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000174\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022dc6c0f88-e781-476d-bca1-d1bf9b69302b\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00224a24496211f44e7dbdea4a0143e1467f\u0022\u003EHon AMY ADAMS (Minister for Communications):\u003C/span\u003E I have confidence that the system is working as intended as anyone with a landline or usable mobile connection is able to access this service free of charge 24/7, and call answering targets are not only being met but significantly exceeded.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000175\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022ebb4ac6b-662b-498f-a27f-832d054e6585\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022aac0a476c93f49b2a8f236c0fed84ac3\u0022\u003ERia Bond\u003C/span\u003E: How can the Government be meeting its Kiwi share obligations, given that Spark must answer 111 calls, yet there is no obligation or time-scale on this Government to end mobile black spots in rural New Zealand?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000176\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022dc6c0f88-e781-476d-bca1-d1bf9b69302b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022dd46f21a030b469f9e93f81672fabc0a\u0022\u003EHon AMY ADAMS\u003C/span\u003E: Mobile black spots is drifting quite a long way wide of 111 calling, but I can assure that member that this Government has actually invested nearly $450 million in mobile rural connectivity, and that means that we now have coverage to more than 97 percent of New Zealanders. We have just announced another $50 million into mobile black spots, and I am just proud to be part of a Government that is doing something about it after years of neglect under parties including that member\u2019s party. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000177\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022ebb4ac6b-662b-498f-a27f-832d054e6585\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00228d4f5418ae784ab3b7a463a78abd8a5e\u0022\u003ERia Bond\u003C/span\u003E: When will she prioritise areas of rural New Zealand such as M\u014Dtatau in Northland and Wyndham in Southland, which have no stable mobile coverage, as evidenced when I personally tried to save a life in M\u014Dtatau on 24 October and could not\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000178\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00221acb125e7a56416f9228db0c4bf233e6\u0022\u003EMr SPEAKER\u003C/span\u003E: Order! The question is too long.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000179\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022dc6c0f88-e781-476d-bca1-d1bf9b69302b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022c48f227445024c2bb4cf30e292cd2d04\u0022\u003EHon AMY ADAMS\u003C/span\u003E: We prioritised rural connectivity on 8 November 2008 and have been doing so ever since, which is why this Government has spent $450 million improving connectivity, why we now have rural mobile coverage to 97 percent of where New Zealanders live and work, and why we are now spending another $50 million to further enhance mobile black spot coverage in New Zealand. But it is true that not every single part of New Zealand will be covered. We have an incredibly vast mountainous country, including vast ranges of unexplored and undeveloped areas, and people going into those areas, I think, have an expectation that they will not get mobile coverage. But I can say to that member that 97 percent of mobile coverage is, I think, a very, very good position to be in.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000180\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022ebb4ac6b-662b-498f-a27f-832d054e6585\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00228d81e7b96a5843369561db5638f85fb5\u0022\u003ERia Bond\u003C/span\u003E: In light of her answer, is she concerned enough to prioritise alternative infrastructure technology for rural communities to save rural lives; if not, why not?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000181\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022dc6c0f88-e781-476d-bca1-d1bf9b69302b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00221288cfb91b9d4fe2a982dfcce4472cd7\u0022\u003EHon AMY ADAMS\u003C/span\u003E: As I said at the outset, anyone with a landline and anyone with a mobile phone is able to access 111. If you are leaving areas of accepted mobile coverage, it is recommended that people carry alternative means of communication like satellite phones when they are out in the high country. But 97 percent mobile coverage is significant. It is better than it has ever been before, and yet this Government is still investing further money in it. It is pretty rich for parties that have never done anything to advance it, and never supported what this Government is doing, to try to now criticise it.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000182\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022495761c2ba7b4db0bfb85f73108da9ad\u0022\u003EQuestion No. 1 to Minister\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00229dc203b3-21b0-4d4a-a530-746504e05f20\u0022 data-id=\u00223738174344b24c109d55f7d2a872b460\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000183\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00229dc203b3-21b0-4d4a-a530-746504e05f20\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00223738174344b24c109d55f7d2a872b460\u0022\u003ERICHARD PROSSER (NZ First):\u003C/span\u003E I raise a point of order, Mr Speaker. I seek your clarification on an issue that occurred earlier during question time with regard to a member taking offence and requesting that words be withdrawn.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000184\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002213a611debc474c99aad8b1a7ea5c8ee8\u0022\u003EMr SPEAKER\u003C/span\u003E: Where is the member referring to?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000185\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00229dc203b3-21b0-4d4a-a530-746504e05f20\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002203a478cc59d3416ba3226970e4b0a906\u0022\u003ERICHARD PROSSER\u003C/span\u003E: It is Standing Order 119. My question is as to what criteria are used by yourself in determining whether the House has taken offence, because there appears to be some ambiguity between Standing Order 119 and Speaker\u2019s ruling 61/1.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022 data-id=\u0022423249c3d4104fe59fae15a3597b04d1\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000186\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022423249c3d4104fe59fae15a3597b04d1\u0022\u003EMr SPEAKER\u003C/span\u003E: I can assist the member. I determine whether the House has taken offence, judging by the order of the House at the time and the context in which the remark is made. In this particular case I was conscious that the Prime Minister had said that he had information from an Australian politician\u2014I think it was from the Australian Prime Minister\u2014stating that a number of these people who are detained are there for very serious crimes. That influenced the decision I gave earlier. But what the member is doing now is simply taking an opportunity at this stage to relitigate a decision I made earlier. That in itself leads to disorder.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000187\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022b6e49edaf6d4416fbd6b9ddc4396b62d\u0022\u003EChristchurch Recovery\u2014Justice and Emergency Services Precinct\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022ee649aea-c6fa-4610-9fcf-5c4bb2d3cd33\u0022 data-id=\u00220696a73ec9864934a25aeea68044d944\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000188\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022ee649aea-c6fa-4610-9fcf-5c4bb2d3cd33\u0022\u003E11. \u003Cspan class=\u0022HpsByToc\u0022 id=\u00220696a73ec9864934a25aeea68044d944\u0022\u003EMATT DOOCEY (National\u2014Waimakariri)\u003C/span\u003E to the Minister of Justice: What progress can she report on construction of the Christchurch Justice and Emergency Services Precinct?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022dc6c0f88-e781-476d-bca1-d1bf9b69302b\u0022 data-id=\u002268414575b191415ca7401ff25955c188\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000189\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022dc6c0f88-e781-476d-bca1-d1bf9b69302b\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002268414575b191415ca7401ff25955c188\u0022\u003EHon AMY ADAMS (Minister of Justice):\u003C/span\u003E The $300 million Christchurch Justice and Emergency Services Precinct continues to make good progress. The steel superstructures for both the justice and emergency services buildings are now complete, with two of the three buildings to have roofs on by the end of this month. Work has also started on the foundations for the car park building, which is the final building in the precinct. The project remains within budget and on track.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000190\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022ee649aea-c6fa-4610-9fcf-5c4bb2d3cd33\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022a65073fcd58e45e3aa058cfbdfbe1a49\u0022\u003EMatt Doocey\u003C/span\u003E: How will the Justice and Emergency Services Precinct improve the way the Government delivers justice services in Christchurch?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000191\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022dc6c0f88-e781-476d-bca1-d1bf9b69302b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022189878f5bfed4df7ac1ce27710e2425f\u0022\u003EHon AMY ADAMS\u003C/span\u003E: When completed, the precinct will encompass around 1,100 staff and 900 visitors across five levels, 42,000 square metres of floor space, and 19 court rooms. It will locate the key justice agencies, allowing police, the Department of Corrections, and the courts to share services and resources\u2014for example, having one set of secure cells to house offenders, saving cost, travel time, and risk. These financial savings alone are estimated to amount to $9.8 million per year, to say nothing of the intangible benefits that will accrue.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000192\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022178213dd9e274405b5d89c4e3a7d4bf3\u0022\u003ETrade Agreements\u2014Overseas Ownership of New Zealand Properties\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022f5d71749-ae91-4af7-b2bd-77260398912a\u0022 data-id=\u00226da72933bf8a4f1d97682a30e6cd155a\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000193\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f5d71749-ae91-4af7-b2bd-77260398912a\u0022\u003E12. \u003Cspan class=\u0022HpsByToc\u0022 id=\u00226da72933bf8a4f1d97682a30e6cd155a\u0022\u003EHon DAVID PARKER (Labour)\u003C/span\u003E to the Minister of Trade: Does the provision at page 8 of Annex II of the New Zealand - South Korea FTA mean South Korea can adopt or maintain a ban on New Zealand people buying South Korean homes?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022c0f78f60-c2fd-46f4-8138-72f39692fc20\u0022 data-id=\u0022b5042eac0dd447f9ae5af42c537ea090\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000194\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0f78f60-c2fd-46f4-8138-72f39692fc20\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022b5042eac0dd447f9ae5af42c537ea090\u0022\u003EHon TODD McCLAY (Associate Minister of Trade)\u003C/span\u003E on behalf of the Minister of Trade: Yes.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000195\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f5d71749-ae91-4af7-b2bd-77260398912a\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022d90fc135ae004fbe81932faecd5c30c3\u0022\u003EHon David Parker\u003C/span\u003E: Is the reason that Minister Groser would not answer that same question last week that he did not know, or was it that it shows up his Government\u2019s incompetence in giving up New Zealand\u2019s right to ban foreign buyers of New Zealand homes while agreeing that South Korea can?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000196\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0f78f60-c2fd-46f4-8138-72f39692fc20\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022764c02b93d904a31a40d7899f3b8cc6c\u0022\u003EHon TODD McCLAY\u003C/span\u003E: No. New Zealand has applied a consistent approach to this issue in all free-trade agreements. I understand that the Minister of Trade followed exactly the same strategy as the then trade Minister, Phil Goff, used with the China free-trade agreement negotiations. The outcome is exactly the same in both the China and the Korea free-trade agreements. They are both high-quality agreements, they both deliver jobs and investment for New Zealanders, and they both treat property transactions the same. Mr Parker needs to talk to Mr Goff.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000197\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f5d71749-ae91-4af7-b2bd-77260398912a\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002224e362648df04299b778828ee9f8020c\u0022\u003EHon David Parker\u003C/span\u003E: I raise a point of order, Mr Speaker. [Interruption] \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000198\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00220cb531530c4348d1b0a190e7e458ef79\u0022\u003EMr SPEAKER\u003C/span\u003E: Order! I have a point of order from David Parker.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000199\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f5d71749-ae91-4af7-b2bd-77260398912a\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002286d9adbf86ca4a429b338c165167c7d3\u0022\u003EHon David Parker\u003C/span\u003E: I seek leave to table the relevant pages of the free-trade agreement with China, under which New Zealand can ban foreign purchasers\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000200\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00229205541cc8184b9d8e798137b7a6488b\u0022\u003EMr SPEAKER\u003C/span\u003E: Order! Again, that information is very available to all members if they want to go and look it up.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000201\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f5d71749-ae91-4af7-b2bd-77260398912a\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002222bac2a3cc1a40a38fdd8a6cd16cc690\u0022\u003EHon David Parker\u003C/span\u003E: I raise a point of order, Mr Speaker.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000202\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002204ec0f5e6ab84ca8ab24d4e588491eb4\u0022\u003EMr SPEAKER\u003C/span\u003E: Is it a fresh point of order?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000203\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f5d71749-ae91-4af7-b2bd-77260398912a\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00228b25193e919d446a9259185609c6f9a5\u0022\u003EHon David Parker\u003C/span\u003E: No, it is speaking to that point of order.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000204\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022c158e3bc42804be5a5616cc9f9088f7c\u0022\u003EMr SPEAKER\u003C/span\u003E: I will hear very briefly from the member.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000205\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f5d71749-ae91-4af7-b2bd-77260398912a\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022eb34181cd2f946f4ac231dda24da6095\u0022\u003EHon David Parker\u003C/span\u003E: The free-trade agreement with China runs to many thousands of pages, as most free-trade agreements do. It is very difficult for members\u2014and, obviously, the Minister\u2014to find the relevant clause, so\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000206\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002236fa1e50cfd74e1181d5b7ea221e7245\u0022\u003EMr SPEAKER\u003C/span\u003E: Order! I have heard enough. I will accept the member\u2019s first point. I will put the leave to the House, and it will be for the House to decide. Leave is sought\u2014the member wants to table the relevant pages regarding the section of the China free-trade agreement. Is there any objection? There is none. He can do so.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000207\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003EDocument, by leave, laid on the Table of the House.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000208\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f5d71749-ae91-4af7-b2bd-77260398912a\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022e62fdfd9bfdf41919bea4b24f53b8eea\u0022\u003EHon David Parker\u003C/span\u003E: Is the Minister saying that the free-trade agreement signed with China stops the New Zealand Government banning the sale of New Zealand homes to foreigners, including China?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000209\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0f78f60-c2fd-46f4-8138-72f39692fc20\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00226b7207f030f74a45a8ebfecce13468c9\u0022\u003EHon TODD McCLAY\u003C/span\u003E: What I am saying is that the approach of the China free-trade agreement negotiation and the Korea free-trade agreement negotiation is the same, and the outcome is the same. But in respect of the primary question, the Government had a number of priorities it negotiated: preserving sensitive land provisions under the Official Information Act, and we were successful in this; ensuring that there were no adverse changes to the foreign investment provisions, and we were successful in this; ensuring Treaty of Waitangi exemptions were done; getting a good deal for New Zealand exporters to create opportunities and jobs in New Zealand and grow the economy, and that was done; and to ensure the outcome of equal standing to the China free-trade agreement on that issue, and this too was successful.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000210\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227e22bb95-9afb-449c-bcd2-de9fd4f2277c\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00221dc4452f93b6476292eee935ef5af0c0\u0022\u003EDavid Seymour\u003C/span\u003E: Does New Zealand have a history of unilaterally dropping trade barriers; if so, to what effect and under which parties?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000211\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022615211fa25cb48f382580df1bf0534d2\u0022\u003EMr SPEAKER\u003C/span\u003E: The Hon Todd McClay\u2014either of those two supplementary questions.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000212\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0f78f60-c2fd-46f4-8138-72f39692fc20\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002281d627d312514bba8e83b48c567df32b\u0022\u003EHon TODD McCLAY\u003C/span\u003E: One of the challenges New Zealand exporters face is barriers to trade. The high-quality free-trade agreements that have been entered into by successive New Zealand Governments open up access. They level the playing field. They allow New Zealanders to produce and export. They secure jobs for New Zealanders. These are two good free-trade agreements, and Mr Parker voted in favour of both of them. He should be proud of that.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000213\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f5d71749-ae91-4af7-b2bd-77260398912a\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022d0d2abf92e804b51b191b19edbbe1c51\u0022\u003EHon David Parker\u003C/span\u003E: Given that countries like Australia, Switzerland, and China have bans on the sale of their homes to foreigners, why did he not even try to protect New Zealand\u2019s sovereign right to do the same?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000214\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0f78f60-c2fd-46f4-8138-72f39692fc20\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022bd31a95b3e3d4e2da3f4d37270adb1c1\u0022\u003EHon TODD McCLAY\u003C/span\u003E: There are a range of policy options available to the Government, depending upon the circumstances, but a ban would not be consistent with the Closer Economic Relations agreement with Australia. It would not be consistent with the Singapore, the China, the Korea, or the Taiwan free-trade agreements. This is exactly the same as the Korea agreement. It is a high-quality agreement, as are previous agreements that have been negotiated by previous Governments.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000215\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f5d71749-ae91-4af7-b2bd-77260398912a\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022f931ff6ae11947f299149d52d2561b08\u0022\u003EHon David Parker\u003C/span\u003E: Is he still asserting that the Chinese free-trade agreement prevents the New Zealand Government from introducing a ban on the sale of residential homes to foreigners?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000216\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0f78f60-c2fd-46f4-8138-72f39692fc20\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022870361e377cc4ba7b58be845920f4e45\u0022\u003EHon TODD McCLAY\u003C/span\u003E: I refer to my earlier answers. One thing, though, that is clear in the text that the member\u2014[Interruption]\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000217\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f5d71749-ae91-4af7-b2bd-77260398912a\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022a3eb55f94b2f4ee5a9c15c6e379c7cfc\u0022\u003EHon David Parker\u003C/span\u003E: I raise a point of order, Mr Speaker. I have asked that question in three forms, and he has not answered it\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000218\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00227aee0cce3ef84b12b686ffad078d632c\u0022\u003EMr SPEAKER\u003C/span\u003E: Order! The way forward is I am going to invite the member to restate that question, and then this time we do hope we get an answer.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000219\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f5d71749-ae91-4af7-b2bd-77260398912a\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022cd6487963b5e4841a095be59f3cd6c6d\u0022\u003EHon David Parker\u003C/span\u003E: Is the Minister still asserting that the provisions of the Chinese free-trade agreement prevent the New Zealand Government from imposing a ban on the sale of New Zealand homes to foreigners?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000220\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0f78f60-c2fd-46f4-8138-72f39692fc20\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002284a285d505eb44b9a3d1d3c2c488e221\u0022\u003EHon TODD McCLAY\u003C/span\u003E: What I am asserting is that the approach to the negotiating of those two agreements and the outcome is the same.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000221\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u002257fa7da412a7414da9050c652668e0d1\u0022\u003EQuestion No. 10 to Minister\u2014Amended Answer\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022dc6c0f88-e781-476d-bca1-d1bf9b69302b\u0022 data-id=\u002263f029e8a56c49ae996138eaa65ef152\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000222\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022dc6c0f88-e781-476d-bca1-d1bf9b69302b\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002263f029e8a56c49ae996138eaa65ef152\u0022\u003EHon AMY ADAMS (Minister for Communications):\u003C/span\u003E I seek leave to correct an answer given in question time earlier today.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022 data-id=\u0022b2156f3b008444fbaa91882cc2d80649\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000223\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022b2156f3b008444fbaa91882cc2d80649\u0022\u003EMr SPEAKER\u003C/span\u003E: Leave is sought to correct that. Is there any objection to that course of action\u2014[Interruption] Order! Is there any objection? There is none.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022dc6c0f88-e781-476d-bca1-d1bf9b69302b\u0022 data-id=\u00221714c5e001e741e99915a453de1b55fc\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000224\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022dc6c0f88-e781-476d-bca1-d1bf9b69302b\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00221714c5e001e741e99915a453de1b55fc\u0022\u003EHon AMY ADAMS (Minister for Communications):\u003C/span\u003E In answer to a supplementary question during question No. 10 today it has been brought to my attention that my answer may have indicated that the $50 million Mobile Black Spot Fund is in addition to the $450 million this Government is spending on rural connectivity. It is, in fact, included in that $450 million.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000225\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022058c95ecfa0643c0958ee3e9d14b3a13\u0022\u003EPoint of Order\u2014Unparliamentary Language\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002247c29b78-eee0-4c91-afdf-7b07be780e1a\u0022 data-id=\u002232d2184a86464ab2b6b7afe3f2555b24\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000226\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002247c29b78-eee0-4c91-afdf-7b07be780e1a\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002232d2184a86464ab2b6b7afe3f2555b24\u0022\u003EDENIS O\u2019ROURKE (NZ First):\u003C/span\u003E I raise a point of order, Mr Speaker. Concerning Standing Order 386(2)(c), which refers to \u201Cdiscreditable references to the House or any member of Parliament\u201D, may I respectfully request that you reflect upon whether any of your rulings today were not consistent with the Standing Orders?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022 data-id=\u00227480ec59354649e3b6e235a8a91df6a8\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000227\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00227480ec59354649e3b6e235a8a91df6a8\u0022\u003EMr SPEAKER\u003C/span\u003E: I already gave an assurance earlier to Chris Hipkins, who asked that I do reflect. I will do so.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000228\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022f5f49c2ae3a34917ba76e5f506d4dbfe\u0022\u003EPoint of Order\u2014Leave to Move Confidence Motion, Speaker of the House of Representatives\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00221dbd2811-8e58-4ffb-848d-31c0eaa9690a\u0022 data-id=\u0022bb3afad7213f43c3838c07ba9d92fecb\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000229\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00221dbd2811-8e58-4ffb-848d-31c0eaa9690a\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022bb3afad7213f43c3838c07ba9d92fecb\u0022\u003ECHRIS HIPKINS (Labour\u2014Rimutaka):\u003C/span\u003E I seek leave to move, without notice, a motion of no confidence in you as the Speaker, as a result of your rulings today.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022 data-id=\u0022fd196e17fb83472fa17537abd6fa6b70\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000230\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022fd196e17fb83472fa17537abd6fa6b70\u0022\u003EMr SPEAKER\u003C/span\u003E: Leave is sought for that course of action. Is there any objection? [Interruption] Order!\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000231\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022e6adf72278d24410a73621e882a39866\u0022\u003EPoint of Order\u2014Withdrawal of Unparliamentary Language\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00227c215736-b512-41de-8f0c-6c5543fcfce7\u0022 data-id=\u00221e985d9f9b7b434e80674f5526ca6ef2\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000232\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227c215736-b512-41de-8f0c-6c5543fcfce7\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00221e985d9f9b7b434e80674f5526ca6ef2\u0022\u003EJAMES SHAW (Co-Leader\u2014Green):\u003C/span\u003E I raise a point of order, Mr Speaker. In relation to Speaker\u2019s ruling 61/1, which reads: \u201CThe cause for a matter to be withdrawn in the House is not that one member feels aggrieved. A member is required to withdraw something because the House itself is affronted.\u201D You referred to this in your earlier ruling. It says \u201Cnot one\u201D. How many members would need to feel affronted before you ruled that it would be affronting the House?\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022 data-id=\u00226bdabd6a444b4b97929d24213818065c\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000233\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00226bdabd6a444b4b97929d24213818065c\u0022\u003EMr SPEAKER\u003C/span\u003E: There is no formula that I can give the member that may help in a future situation. I have got to judge the tone of the questions that are being asked, the tone of the answers that are being given, and then make a call. There is no formula that I can give about whether it is four who rise to do so. Often we get the case\u2014in fact, I can think of numerous cases\u2014where a member says that he has taken offence, I rule that that is, in my mind, not a matter of offence, and three or four others will rise, almost in an orchestrated campaign, to try to join in. That has happened before in the past. I make a call depending on the circumstances, as I have explained. As I have said to this House, I will certainly review the proceedings earlier today.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000234\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227c215736-b512-41de-8f0c-6c5543fcfce7\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ee0e800822cf46d88c9a9108852c0321\u0022\u003EJames Shaw\u003C/span\u003E: I raise a point of order, Mr Speaker.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000235\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002221458dc7201d45b9874dabec67bed094\u0022\u003EMr SPEAKER\u003C/span\u003E: A fresh point of order?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000236\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00227c215736-b512-41de-8f0c-6c5543fcfce7\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ae465314dadc40d787f3e962effaffb0\u0022\u003EJames Shaw\u003C/span\u003E: Well, in relation to\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000237\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00225c8dbf0f331642afb74af31b640b5fed\u0022\u003EMr SPEAKER\u003C/span\u003E: No. I have dealt\u2014[Interruption] No, we have spent a lot of time on this matter. I have dealt with it. If the member has a fresh point of order, I am only too happy to hear it, but, at this time, I have dealt with this other matter.\u003C/span\u003E\u003C/p\u003E\n    \u003C/div\u003E\n    \u003Cdiv class=\u0022HpsHansard\u0022\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000238\u0022\u003E\u003Cspan class=\u0022HpsProceedingHeading\u0022 id=\u002261a4c644cdcb40209856ee5a08a02929\u0022\u003EUrgent Debates Declined\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000239\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022f0a0bdd5bb6f47ab98cc365b3b17b624\u0022\u003EPolice\u2014Investigation into Abusive Images\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022 data-id=\u00227a0995b4fb654d93b3ba3f4e758cbccf\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000240\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00227a0995b4fb654d93b3ba3f4e758cbccf\u0022\u003EMr SPEAKER\u003C/span\u003E: I have received a letter from Tracey Martin seeking to debate, under Standing Order 389, the actions of the police in relation to degrading images posted online by a group of high school boys. In order for an urgent debate to be held, there must be a particular case of recent occurrence involving ministerial responsibility. It was reported yesterday that the police had warned boys who posted images and that charges would not be laid. Although the Minister of Police is answerable to this House for police operational matters, under our system of Government the decision to prosecute or not is not a matter of ministerial responsibility.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000241\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e4b09a29-dfd3-42c0-8585-11463bd6077b\u0022\u003EThe purpose of an urgent debate is to hold the Government accountable for an action that has occurred for which it is responsible. There must be a distinct Government responsibility for the particular case that has been sought to debate. An urgent debate is not an opportunity for a general debate of issues of concern to members. The application is, therefore, declined. [Interruption] Order! [Interruption] Order! That sort of behaviour is\u2014[Interruption] Order!\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=\u0022id201511106fb25f893e954ed5af8f886e805377f3000242\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022e06f72c4d7c44cbcb9708e0785a61202\u0022\u003EInternational Finance Agreements Amendment Bill\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000243\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u002242c9358b7b6e41758293b625d5084de9\u0022\u003EIn Committee\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000244\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u0022b1c0e9042f5a4cb887e3834b0f92ffe4\u0022\u003EPart 1  Preliminary provisions\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00226007dc96-f459-4cdd-9972-4fde2c994088\u0022 data-id=\u002256134a6fb2f44b6d9398838d1c6c6228\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000245\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226007dc96-f459-4cdd-9972-4fde2c994088\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002256134a6fb2f44b6d9398838d1c6c6228\u0022\u003EGRANT ROBERTSON (Labour\u2014Wellington Central):\u003C/span\u003E It is a pleasure to take a call on Part 1 of the International Finance Agreements Amendment Bill. As we discussed when the House was looking at this during the second reading, it is a bill that did not generate an enormous amount of public interest when it came before the Foreign Affairs, Defence and Trade Committee. In fact, there was precisely no public interest when it came before the select committee, but that is not to say that it is not an important piece of legislation. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000246\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226007dc96-f459-4cdd-9972-4fde2c994088\u0022\u003EWhat I think would be useful here in Part 1 is\u2014obviously, Part 1 is the purpose clause, and the purpose of this bill is to allow New Zealand to participate in the Asian Infrastructure Investment Bank. In principle, that is something that on this side of the Chamber we support. There is no doubt that as the Asian region continues the enormous growth that we are seeing across it, the need for infrastructure investment\u2014the need for investment that the international community provides\u2014only grows. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000247\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226007dc96-f459-4cdd-9972-4fde2c994088\u0022\u003EThe Asian Infrastructure Investment Bank arose out of the belief, and I guess you could say the concern, of those in the Asian region that the gap in infrastructure investment was too big to be bridged by those organisations that are currently working in the region\u2014in particular, we think here of the World Bank and the IMF. That was initially the subject of some significant concern by core stakeholders within the World Bank. There were some media reports that the United States Government and others were lobbying against countries being involved in this, but we are told in the report that was provided to the select committee that other agencies like the World Bank have been closely cooperated with and collaborated with in developing the frameworks to allow this to exist and, importantly, that they will work together with the Asian Infrastructure Investment Bank to make sure that their projects do not cut across each other or are not, in fact, not working together in the best interests of the countries in the Asian region. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000248\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226007dc96-f459-4cdd-9972-4fde2c994088\u0022\u003ESo, having got to that position, it is good to acknowledge that New Zealand officials have been working alongside others to make sure that this bank has the strongest possible governance arrangements and has the best working framework to ensure the investments it makes are going to not only provide that infrastructure but also support other values that are important to New Zealanders. It is worth noting that it was New Zealand officials who worked very hard to ensure that appointments to the board of the Asian Infrastructure Investment Bank will be open, transparent, and merit-based, that there will be a non-resident board of directors, and that the appropriate environmental, social, and procurement safeguards will be put in place around what the bank does. That is very significant because although in principle we can say: \u201CYes, we want this infrastructure to happen.\u201D, if there are not the right safeguards around it, then we could see infrastructure investment that is less than desirable. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000249\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226007dc96-f459-4cdd-9972-4fde2c994088\u0022\u003ESo annex 1 of the framework document lists off the draft environment and social framework for the Asian Infrastructure Investment Bank. It is useful to note the environmental coverage is making sure there is an assessment around biodiversity impacts, critical habitat impacts, protected areas, and climate change\u2014the precautionary approach. All of these are really important parts of what makes for good investment. They have been secured in this agreement, and from our point of view that is very important. We also have the social coverage, which includes social risks, impacts on the community, impacts on vulnerable groups, and gender-specific impacts\u2014an important thing to note on Equal Pay Day, today. It also talks about working conditions and the fact that during the implementation of operations, working conditions, health and safety, child labour, forced labour, and labour relations standards all have to be taken into account when infrastructure investment is being put in place under the Asian Infrastructure Investment Bank\u2019s work. These are important safeguards, and it is very important for New Zealand\u2019s participation that those safeguards are there. New Zealand worked hard to ensure that the governance arrangements and the safeguards were there\u2014that there was stability. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000250\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226007dc96-f459-4cdd-9972-4fde2c994088\u0022\u003EOur actual financial contribution to the bank is modest but perhaps appropriate in terms of our relative GDP\u2014well, it has to be appropriate in terms of our relative GDP because that is how it is worked out. So we are making an initial contribution of around\u2014well, let us do US dollars because of exchange rate fluctuations, shall we\u2014US$92 million over the next 5 years. We have also committed US$369.2 million of callable capital. As my colleague Phil Goff noted in his intervention in the second reading, New Zealand has never had to call on the capital that we put aside, but that is the extent of the contribution that we have made. As I say, although that is not a significant financial contribution, it is an important stake for New Zealand to say that we are committed to this bank. We are committed to the Asian region and the opportunities that arise. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000251\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226007dc96-f459-4cdd-9972-4fde2c994088\u0022\u003EThe reasoning for joining the bank was threefold. Economic factors\u2014New Zealand\u2019s economic success is linked to the Asian region. I know that the leader of the Labour Party, Andrew Little, was in China last week, and other Ministers from the other side of the House have visited regularly as well. No one can underestimate the extent of the development that is there and the extent to which China is continuing to invest. The Prime Minister will go with a business delegation to Viet Nam next week\u2014there is a country where there is a need for increased infrastructure investment for it to continue to develop sustainably. It has enormous rates of growth, but it is a country that could do that. We have just seen the elections this weekend in Myanmar\u2014there is a country with an enormous infrastructure deficit that could be assisted by the work of this bank. From New Zealand\u2019s point of view, all of those are countries with which we will trade, and do trade, and all of those are countries that we want to see flourish in order for our region to flourish. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000252\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226007dc96-f459-4cdd-9972-4fde2c994088\u0022\u003EThe second reason was around connectivity to market and our ability to build on the connections that we already have in Asia. We have status within ASEAN, we attend the East Asia Summit\u2014that is where the Prime Minister is going next week\u2014and obviously we have the free-trade agreements with China and other ASEAN members. This is a further step in New Zealand staying connected in the Asian region and connected to where we will see much of our future trade relationships. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000253\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226007dc96-f459-4cdd-9972-4fde2c994088\u0022\u003EThen there is just the question of the ability to influence. If New Zealand is not there in a discussion like this, we do not have the ability to do the very things that I mentioned before\u2014making sure that the governance arrangements are sound and that the bank is working with the systems that we would want. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000254\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00226007dc96-f459-4cdd-9972-4fde2c994088\u0022\u003ESo I will leave my contribution there. Suffice it to say that the Labour Party supports this bill. In this Part 1 of the bill there are no particular changes to deal with. In Part 2 there is one, which I will take a brief call on.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022 data-id=\u0022dd6dd07cc788451fadbddf240aa1576f\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000255\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022dd6dd07cc788451fadbddf240aa1576f\u0022\u003EHon BILL ENGLISH (Minister of Finance):\u003C/span\u003E Can I thank the member for a pretty succinct and sensible summary of the Asian Infrastructure Investment Bank and its purpose, as laid out in this bill. Also, can I thank the Foreign Affairs, Defence and Trade Committee and chairman Mark Mitchell. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000256\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003EThe legislation is here because the New Zealand Parliament has dealt with it pretty expeditiously. I have just a couple of points to make in addition to those made by the member, and I look forward to contributions on the way through this debate. It is a slightly unusual piece of legislation\u2014it is not the only one that has been done like this but, essentially, we are legislating the Articles of Agreement of the Asian Infrastructure Investment Bank, which were not written by us. They are the result of the collective discussions of a significant number of countries.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000257\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003EI might say that the way they are laid out in this legislation should be a lesson to our own bureaucracy. There is admiral economy, clarity, and brevity in these articles, for what is a complex multinational institution. It all fits into about 20 pages, or slightly more, and you can actually read it and understand it. So I would like to give the select committee credit for that but, actually, it did not have the opportunity to get into the detail of it\u2014although I know Mr Parker could have improved on it.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000258\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003EHowever, it does demonstrate something that I think is certainly a feature of a bipartisan approach in New Zealand and that is that under successive Governments, New Zealand has been able to carve out a bit of a role as an honest broker in international events and international forums. This piece of legislation here is a product of that, actually, because when the original proposal was put forward there was a great deal of concern and reticence among a number of countries that this bank may be set up in a way that enabled it to expedite the policies of the Chinese Government, and that was it. Of course, it was any number of countries that were interested in participating because they were interested in the investment capital, and the member Grant Robertson mentioned some of them.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000259\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003EBut with the early focus on Singapore, but particularly New Zealand\u2014because we count in the international world as a developed economy, while the much wealthier economy of Singapore counts as a developing economy\u2014as the first developed economy to participate, was able to have considerable influence over the articles as we find them here.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000260\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003EAnd, finally, can I just acknowledge the role of the parties across the Parliament. The speed at which this multilateral institution was proposed and has come into existence is remarkable, by any standard. In fact, there probably has not been another one like this. That demonstrates, I think, a wide set of interests in the broader multilateral community, particularly to have institutions of a higher quality and a broader base than the current World Bank and the IMF, where, unfortunately, reforms to their make-up that reflect the fact that the balance of world GDP has shifted away from the European and North American economies to a whole range of emerging economies\u2014those reforms simply have not proceeded, for various reasons, but it has been disappointing. So there has been an interest from the international community in this institution because it can start afresh in the 2010s rather than the 1940s, and the world, of course, is a bit different now.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000261\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bb158206-360b-4757-8d72-f7d0994e1fb3\u0022\u003ESo I want to acknowledge the fact that the Parliament has seen the virtue of that, and has expedited this legislation so that we will meet the deadline\u2014by 1 January this will be in place and New Zealand will, along with other countries, be able to take up its role in the governorship of this bank.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022f5d71749-ae91-4af7-b2bd-77260398912a\u0022 data-id=\u00226e6a7305dada4d36979ca18751c352b7\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000262\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f5d71749-ae91-4af7-b2bd-77260398912a\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00226e6a7305dada4d36979ca18751c352b7\u0022\u003EHon DAVID PARKER (Labour):\u003C/span\u003E Can I concur with my colleague Grant Robertson and the Minister of Finance\u2019s comments. I do think it reflected well on New Zealand that we were early to the party when it came to saying that we thought that this was a good idea, and that we then tried to mould it into a well-governed organisation that will do good in the world. I know that some of the opposition in other parts of the world was not just against the potential\u2014as the Hon Bill English has said\u2014misuse of this fund as an instrument of Chinese Government policy, which was one of the original concerns. Actually, their concerns were sometimes just about the rising influence of China, and a desire that China not be able to exert the influence in the world that it can through this new agreement. That was an inappropriate reason for opposition to this Asian Infrastructure Investment Bank, and I am pleased that the New Zealand Government got on the right side of that debate from fairly early on.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000263\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f5d71749-ae91-4af7-b2bd-77260398912a\u0022\u003EThere is one issue in particular that I would like to raise in respect of Part 1. Part 1, as the Minister has already told the Committee, inserts the articles of association that are set out in new schedule 8 in the schedule of this bill. It does that at clause 5 of the bill. Those articles of association include the number of shares that the New Zealand Government subscribes for, and everyone who subscribes for a share takes up a capital subscription\u2014or a capital risk, if you like; some of it has to be paid across, but some of it is just there to be called upon if needed. Every 10 of those shares carries with it a $1 million capital subscription, so New Zealand\u2019s capital subscription is $461.5 million for 4,615 shares. I have done a quick calculation as to what New Zealand\u2019s share of the total is, because there is $75,000 million of capital being subscribed for. As a consequence, New Zealand\u2019s contribution is 0.64 percent of the capital, roughly\u2014less than 1 percent.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000264\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f5d71749-ae91-4af7-b2bd-77260398912a\u0022\u003EThe proportion that New Zealand takes in these organisations\u2014and the IMF is the same\u2014is lower than it would have been in yesteryear because the New Zealand economy has not grown at the same rate as overseas economies have, and, as a consequence, our proportion of the total of these capital funds is less than it used to be in yesteryear. We saw that\u2014I am not sure whether it was earlier this year or last year\u2014when an Act of Parliament was brought in to change another of the agreements under the International Finance Agreements Act, where we amended the IMF articles to note the changing proportion of different countries in the world economy, and New Zealand\u2019s percentage of the total capital went down because our share of the world\u2019s economy went down because New Zealand has not done as well as some other countries. At the time of that debate, the International Finance Agreements Act was amended to enable amendments to articles of association by way of regulation by the executive, rather than bringing those agreements back to this House. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000265\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f5d71749-ae91-4af7-b2bd-77260398912a\u0022\u003EThe effect of this amendment bill, in concert with the earlier amendment bill that says these things can be changed by regulation, is that this Parliament is setting up a system in respect of the Asian Infrastructure Investment Bank, which is what this bill is mainly about, that in the future we are handing over to the executive the power to change. We objected to that at the time, when the regulation-making power was being conferred on the Minister of Finance and the Government, because we think that we should have these important agreements coming back to this House when they require alteration. It actually does not happen very often. I think the IMF articles have been changed only a few times since they came into force many, many decades ago, so it is not an onerous task for Parliament to keep an oversight of how our participation or how the rules of those organisations change.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000266\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f5d71749-ae91-4af7-b2bd-77260398912a\u0022\u003EI am not going to take much longer on that point, other than to note the fact that I would like the Minister in the chair to respond with why it is that he thinks that when New Zealand\u2019s obligations under these articles change, because of a change in the articles\u2014where they do have significant monetary effects for New Zealand\u2014why that sort of thing should be able to be done by the executive, rather than coming back to this Parliament, because that is what we are doing with this clause.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022 data-id=\u0022cc71c9abe51b4bbeab2ac531758d72fd\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000267\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022cc71c9abe51b4bbeab2ac531758d72fd\u0022\u003EHon PHIL GOFF (Labour\u2014Mt Roskill):\u003C/span\u003E Part 1 of the International Finance Agreements Amendment Bill sets out the purpose clause, and the purpose is, of course, to enable New Zealand to become a member of the Asian Infrastructure Investment Bank. Then the rest of the bill implements our obligations under it, including the whole of the articles of agreement, which take up about 30 of the 34 pages. Labour supports this bill, and the reason that we have supported it, both at the Foreign Affairs, Defence and Trade Committee and here in the Chamber, is that there is a gap in infrastructure investment in the Asia region, and this enables us to join a bank that will foster sustainable economic development. But I have questions for the Minister in the chair, the Hon Craig Foss, who, I am sure, is very well informed about the bill. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000268\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EThe first thing\u2014when we assessed whether we should become a member of the bank\u2014was that it was very well known that the United States was opposed to countries joining up to it, and it was opposed for basically two reasons. First of all, it claimed, somewhat curiously, that investment needs were being met in the Asian region. I say \u201Ccuriously\u201D because both the World Bank and the Asian Development Bank, which are both operating in this area, suggested that a further trillion dollars was needed each year to support economic growth in the region. So it is not a case of the Asian Infrastructure Investment Bank elbowing out other banks, but rather supplementing those banks to meet an unmet need. The second reason that the United States appeared to oppose this was that it said it would expand the influence of China. I actually concur, curiously, with the comments of the Minister of Finance, who made it clear that the gap was there and it was real, and that the old Bretton Woods institutions were not doing the job. They were not doing the job partly because they reflected the world as it was in 1945, and not as it is in 2015. One of the outcomes of that is that China was actually constrained from playing the full role that it ought to play in Asia under those Bretton Woods institutions. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000269\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EIt is quite clear that China is an economic superpower. It is the second-largest economy in the world, and, equally, that gives it responsibilities and obligations to help other countries in the region\u2014and by providing infrastructure investment it can do that. Of course under what is set out in this bill in the articles of agreement, China will end up with about 25 to 30 percent of the voting rights. That gives it a significant role, and that is because it invested $30 billion out of the $100 billion that will be available for infrastructure investment. But my question to the Minister is this: as we worked through the process of agreeing to become a member of this bank, what approaches were made, directly or indirectly, formally or informally, by the United States to try to persuade us not to become members? As it happens, its expressed opposition to the bank has not prevented the vast majority of countries in the region\u201438 regional members of the bank from the Asian and Middle East region, and 20 non-regional members\u2014signing up to the bank. That includes other countries, like Germany, France, the United Kingdom, and the Scandinavian countries, which are, clearly, very much part of the Western, developed world but nevertheless see some real benefit in having this bank set up and operating. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000270\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EI want to just touch briefly on the amount of capital that we are putting into it, because I know that other parties in the Committee may have some concern about that. The subscribed capital is US$92 million. That, however, is payable over 5 years, so the amount of money that we are sinking into it each year is less than the referendum on the flags debate. I think it is about $22 million a year that it comes out at. We also put up US$369 million in callable capital, but when I did a little bit of research on our participation in like institutions, to the best of my knowledge the callable capital that we have committed to has never been called up, because the institutions have never run into financial difficulty. I would like the Minister, if possible, just to confirm that fact. So the US$369 million that we will subscribe in callable capital is unlikely to be called upon. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000271\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EWhy are we becoming a member of this bank? That is what the purpose clause addresses. I think the first cause, very clearly, is economic. Our future now is inextricably linked to the future of the Asia-Pacific region, and as such, with most of our largest trading partners in the Asia-Pacific region, we have a vested interest in how well the region does. I did a free-trade agreement with China and with ASEAN. Those countries are all part of this bank, and those countries, particularly the ASEAN countries, will benefit from having a bank that will improve its infrastructure\u2014the infrastructure of the countries\u2014and improve their economic performance. That will have a flow-on effect for New Zealand. So it is the right thing to do, but doing it will also benefit New Zealand economically. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000272\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EThe other benefit we get is from our connectivity to the market. We are a country that has origins as a Western, European country, but we have fought very hard to be seen as an active, participating, and contributing member in the Asia-Pacific region. As a small country we do not have a very large share in this bank, or voting power, but it is the symbolic importance of our being seen to be committed to the development of the region. What is really important, from my experience in working economically and in trade matters with the Asia region, is building relationships. Before you can do business you need to build a relationship, and this, for us, is about building that relationship. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000273\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EThe third reason why we are being a member, I think, is because it gave us a chance to get in very early on in the development of this bank and to influence how that bank would be set up and the rules under which it would operate. I want to again pay tribute to John Whitehead, who represented New Zealand in those negotiations. I think he did a fine job. We were able to help ensure that the membership of the bank is broad and open. We were able to ensure that there are sound governance and appointment processes followed by the bank. That was important. I think we probably exercised an influence beyond our size. We were able to establish the principle that decisions have to have regard to environmental and social issues. For us and the importance we place on those things, that is also very important. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000274\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EBut, most important, we were able to help ensure that this bank will operate according to economic and financially sustainable principles. As a result, there will be proper oversight for investment decisions and for development outcomes. There will be international best practice for the way this institution runs. When we did the international treaty examination of the bank, there were also risks pointed out, but I think we have been able to mitigate those risks and I think the arguments very clearly are in support of our participation in this bank. I commend those who helped negotiate the agreement. The Labour Party will be supporting this bill through its final stages.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022 data-id=\u0022b5f74c20ca244e45803fc68a58c38b45\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000275\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022b5f74c20ca244e45803fc68a58c38b45\u0022\u003EFLETCHER TABUTEAU (NZ First):\u003C/span\u003E I too would like to acknowledge those officials who undertook that early participation in negotiations in this agreement. I give them credit for the fantastic work that they did. That does not actually preclude our continuing opposition to this legislation.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000276\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003EPart 1 enables our participation in this infrastructure bank. Many of the speakers, including the Minister, have spoken of one of the benefits being the ability to influence economic factors and connectivity to the market. The arguments given are: increased economic development in the Asia region\u2014we have heard that repeatedly; supported increased economic integration\u2014that it augments New Zealand\u2019s existing relationships. Let us take a reality check here, and just stop and look at what the officials actually provided this Committee in terms of information. The reality is that there is nothing in this legislation and nothing in the appendices attached to it, schedule 8, that says\u2014it actually specifically says that there will be no investment in New Zealand. New Zealanders will not seek for investment to be undertaken in New Zealand under this legislation, nor, it specifically says, will the investment bank itself actually invest in New Zealand.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000277\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003EThe question was then asked as to what the benefit is to New Zealand of signing up to this financial agreement. We have heard a lot of lovely intangibles, but the reality is\u2014and this is the reality\u2014Government officials never undertook a financial impact statement or an analysis of the benefit of this financial agreement with New Zealand, because from the outset they established that there would be no, or negligible, financial benefit to the New Zealand economy. Those were the Government\u2019s own official words. That is the reality of this situation that this Committee is in today. That is the reality of the contribution being given here. It sounds lovely when you hear the words from some of the members today about the impact on New Zealand, but that is not the reality. The officials themselves have said so.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000278\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003ENew Zealand First has questioned the economic impact from the outset. The argument has also been around influence, but we would also point out that China, for example, will trade with New Zealand without a free-trade agreement. In fact, trade with China was growing exponentially before a free-trade agreement, because China wanted what we had. It wanted our commodities, and it was prepared to come and negotiate and work with New Zealanders to do that. Businesses and New Zealand will continue to build relationships with China and the ASEAN communities. We have, as Mr Goff so rightly pointed out, these free-trade agreements with the Republic of Korea, with China, and agreements with the ASEAN community. That will not stop, because this Government, for example, would go before them and say: \u201CLook, we\u2019re willing to help you write this infrastructure financial agreement, because we think we have something to contribute, but we actually can\u2019t afford to give you the money.\u201D I think that would have been fair and reasonable, and we would not have broken friendships or undermined our relationships if we had said, honestly: \u201CLook, we\u2019re up to $80 billion to $100 billion worth of Government debt. We\u2019ve sold assets. We\u2019re supposed to be paying for our own hospitals, our own schools, and investing in our own community. Look, the reality is that we can\u2019t contribute that minuscule sum to make this work for you.\u201D\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000279\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003EThe other issue I have, and it is actually a question for the Minister in the chair, Craig Foss\u2014if I can find my notes\u2014is around our participation and our level of influence. I think it was the Hon Mr Parker who said that we have a 0.64 percentage of share in this bank. He is bang on. My calculation was 0.66 percent; it was even more generous. But if you go into the appendices\u2014I ask the question specifically of the Minister in the chair. Our participation on the board is dependent on those rules, and one of those rules says\u2014schedule B of schedule 8, clause 2(a)\u2014that we have to have 6 percent share in this bank in order to be a participative member.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022659f6556-09a1-4ead-bc52-05cbdb4eaab8\u0022 data-id=\u0022baf223a0c2404a6e9d251caefcfa7bef\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000280\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022659f6556-09a1-4ead-bc52-05cbdb4eaab8\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022baf223a0c2404a6e9d251caefcfa7bef\u0022\u003EHon CRAIG FOSS (Minister for Small Business):\u003C/span\u003E Just to give a quick answer to Mr Goff\u2019s point\u2014yes, Mr Goff, you are correct. There are similar organisations, such as the Asian Development Bank, the IMF\u2014the International Monetary Fund\u2014and the World Bank, which we contribute to and have capital invested in, as well as, presumably, this one, if Parliament passes the International Finance Agreements Amendment Bill. The callable capital has never been called upon, Mr Goff, for your clarification. To the previous speaker, Mr Tabuteau\u2014I guess that if New Zealand was an island nation that had no interest in the development of its region, or other economies, or peoples, or cultures, or countries, that member may be correct. But, actually, there is an obligation and responsibility to be part of this region, and those other organisations, which are similar to the organisation we are proposing to invest in here\u2014for example, the Asian Development Bank and the World Bank\u2014invest in the Pacific, actually helping sustainable energy projects and helping countries to become self-sufficient. I guess, in brief, that part of being a leading developed, civilised nation with a solid economy and great history in helping other countries develop is that also, as these Asia-Pacific countries\u2014Asian countries, in particular\u2014that this organisation will be assisting grow, their interest in New Zealand products and services grows as well. So it is actually, in a roundabout way, an investment in our region to help grow our Asia-Pacific region particularly, which will in turn, over time, assist opportunities for the New Zealand economy to grow alongside them. Thank you.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022 data-id=\u002201c6e2737de843cf9f14da6fc59dffd3\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000281\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002201c6e2737de843cf9f14da6fc59dffd3\u0022\u003ESTUART NASH (Labour\u2014Napier):\u003C/span\u003E I hope there are no media watching this, because they may find me in the situation of agreeing with Mr Foss. Mr Tabuteau, it was a rather naive speech. The reason I say that is there are a number of reasons why this is a very important development in the international banking sector. First and foremost, I think you will find that most 21st century literature says that for an economy to grow, it has got to have good, sound infrastructure. We are talking about power stations, we are talking about roads, which are a sort of 20th century infrastructure, but in this day and age we are also talking about copper, about fibre, and all those other things that link the world and allow businesses to locate pretty much anywhere that they can. When you look at the applicants who have joined this bank\u2014we are talking about India, Thailand, Malaysia, Singapore, the Philippines, Pakistan, Oman, Qatar, Sri Lanka, Uzbekistan, and Viet Nam\u2014New Zealand was actually the first developed, Western country to apply to join. In recent months so have a number of others\u2014Germany and Britain, for example. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000282\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EOne of the reasons, as Mr Goff alluded to, that the United States was against this was, it cited, that it believed that the governance within the Asian Infrastructure Investment Bank would not be up to standard. That is slightly ironic in a way because, I believe, after the reading I have done, that if the Asian Development Bank and the International Monetary Fund and the World Bank had actually undertaken the sort of development and put in place the sorts of strategies that the region needed, then this bank would not have been formed in the first place. In fact, the irony is that the push for change around the IMF has been supported by President Barack Obama, because he himself actually called for reform in the IMF last year. So this has really sprung up as a need in the region. As mentioned, it is a massive part of the global economy. It is growing, and it is where a huge chunk of our future lies. The thing is, when America mentioned the governance arrangements and the concerns it has, if you read through chapter V of new schedule 8 in the International Finance Agreements Amendment Bill, it lists all the governance arrangements. It seems to me that it is very clear they need a quorum of two-thirds of members. Article 22 states: \u201C1. Each member of the bank shall be represented on the Board of Governors and shall appoint one Governor and one Alternate Governor.\u201D It looks very, very robust from a governance perspective. I believe that you would find that the Germans and the Brits, let alone other developed countries, would not have a bar of this if they thought that the governance structure was not absolutely sound. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000283\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EThe other thing I would like to talk about is this. If you go to article 2, \u201CFunctions\u201D, of the agreement set out in schedule 8\u2014look at the functions. They are to promote investment in the region of public and private capital, but when you look at article 2(iii), it actually talks about \u201Cto encourage private investment in projects, enterprises and activities contributing to economic development in the region, in particular in infrastructure and other productive sectors, and to supplement private investment when private capital is not available on reasonable terms and conditions;\u201D. One of the legal tests is a reasonable person test, and I wonder what \u201Creasonable terms and conditions\u201D means. If that actually means that this bank is going to lend money more akin to the interest rates in Asian nations as opposed to, for example, in the developed world\u2014in New Zealand, for example\u2014then it is perhaps not a bad thing. Infrastructure is vital, and the funding is US$100 billion. That sounds like a lot of money, and in many circumstances it is. But when we are talking about major infrastructure projects, US$100 billion actually is not that much money, when you think a large power station can cost $2 billion to $3 billion. It is a lot of money, but for infrastructure development in these developing nations, I suspect\u2014and it will be interesting; Mr Foss has said we have never had to call down on our capital reserves, but you may find that this is the case going forward, certainly over 5 years, because these economies are growing at a great rate of knots. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000284\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EI agree with a number of the speakers that it is very important that New Zealand is part of this. Mr Tabuteau is right. I cannot see any circumstance at all where the infrastructure would be built in New Zealand out of money from this fund\u2014it is not needed. We have sufficient capital markets and sufficient private investors to allow the sort of infrastructure needed in this country without having to dive into this whatsoever. But these sorts of banks are not set up to help developed countries maintain or grow their infrastructure; they are really about developing countries, and the flow-on effect from that can be massive. It is already acknowledged that India is an economy growing at a great rate of knots, as is China and a lot of the other economies mentioned. Thank you.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00228a1cb04e-8a86-44d1-9004-6e158e220339\u0022 data-id=\u00224aadb5e8ac6e4f809add814fdad89068\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000285\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00228a1cb04e-8a86-44d1-9004-6e158e220339\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00224aadb5e8ac6e4f809add814fdad89068\u0022\u003ETIM MACINDOE (Senior Whip\u2014National):\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=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022 data-id=\u002219357231de384652a0de07eb5cdd313b\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000286\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002219357231de384652a0de07eb5cdd313b\u0022\u003EHon CLAYTON COSGROVE (Labour):\u003C/span\u003E I, like other members of the Labour Party\u2014we are supporting this piece of legislation. But I do want to touch on a couple of comments that Mr Tabuteau made\u2014and Mr Nash dealt with some of them. In essence, the argument for opposing this seems to be that there is no hope of any monetary investment in New Zealand from this institution, which, as Mr Nash has pointed out, is quite right. We are a developed country, we are not a developing country, and the moneys that will flow from this bank\u2014its purpose is to fill the gap in the infrastructure and development in the Asian region.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000287\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EBut that does not mean that there is nothing in it for New Zealand. What is in it for New Zealand, if you look quite clearly\u2014as colleagues outlined the membership of this organisation\u2014is that we do have influence, we do have connectivity. We have been right at the base and at the foundation of the genesis of this bank to put in place good governance rules and transparency. And as these funds are invested in Asian developing economies, what is in it for New Zealand, I think, is self-evident. As these economies develop their infrastructure, as they grow\u2014at its brutal best, or simplest\u2014the buying power for goods and services of these nations will increase. They will look to countries like New Zealand to engage in commercial arrangements. We will be a recipient, I am sure, as other developed countries are, of much of the work. And that is, in terms of the growth of our economy, the investment and the jobs and all the ancillary benefits that flow from that, as we are party to other countries as their respective economies develop and grow.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000288\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EThe more access that we can get to an economy that is growing and prospering, the better it is for our nation. So I see this as part of a tradition that New Zealander has had for many, many years. We are members of the UN, the Asian Development Bank, the IMF, the World Bank, the World Trade Organization (WTO), and one could argue, and it is true, that both our monetary contribution, as others have said, and our voting contribution or proportion are very modest. That again is not an excuse for us not being around the table. One could argue that in every international institution\u2014the ILO, the World Intellectual Property Organization, and the others that I have mentioned\u2014we have always had a modest role to play and a modest say. A good friend of mine whom some of you will know, Mike Moore, was fond of saying that New Zealand is\u2014what is it\u2014less than 1 percent of the world\u2019s population; some would argue we have 90 percent of the world\u2019s opinions from time to time.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000289\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EOf course, our contribution and our voting muscle at these international institutions are modest, but you have to argue that if you look at our seat around the Security Council, the positions that we have had within the WTO and within the Commonwealth\u2014the whole host of international institutions\u2014to use the old clich\u00E9, we have punched well above our weight. We have had influence. As the Minister Mr English said, we have been looked to on many, many occasions as the honest broker, as the country that does not have an axe to grind, that can go in between countries in economic dispute, or whatever, and do the deal. Those relationships are priceless. Mr Goff said, quite rightly, as the guy who negotiated the China free-trade agreement, that before you can do business in China and in a number of these Asian economies, you have to build that relationship. We may be small. Our contribution in monetary terms may be small, and our voting rights may be extremely small, but we still are respected and we are around the table and we are participating. That is where New Zealand in part gets a massive payoff.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000290\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EI just come back to the original point. This bank, its purpose is to target that gap in infrastructure investment within the Asian region. If that gap is plugged, if there is access to capital in developing countries, those countries grow, their economies grow, they reach out across the world for goods and services and expertise\u2014and we have an advantage being one part of this institution, but we have an advantage because of having the reputation as world-class providers of many goods and services\u2014they will reach out to us and other countries. That is the investment. If you are looking for the investment in New Zealand, that is part of a massive payoff\u2014being there, being part of it, being reached out to, and providing those resources that in turn grow our own economy.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000291\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003ESo I think, with respect, that it is slightly simplistic to say: \u201CWell, we\u2019re investing $126 million initially with a commitment to $504 million going forward, but because the bank\u2019s not going to flick a bit of money to New Zealand, therefore we should not be part of it.\u201D If that was the case we would never have been a part of the Asian Development Bank or the IMF or the World Bank or other institutions, because the likelihood of us receiving capital is, as Mr Nash said, extremely low. We have good institutions. We have mature capital markets. We can fight our own battle economically. So I think you have got to look at this in its widest possible context.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000292\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EAgain, as others have pointed out, there is always the counter question: what is the cost of not being there? What is the cost of not being around the table, part of a growing international institution, with Asia, the fastest-growing region in the world? You could look to the China free-trade agreement easily and say: what if that had not been in place, in terms of the relationships with China? What if we had not participated in the Asian Development Bank and those others\u2014we have ultimate directors there\u2014what would have been the cost to New Zealand? The cost would have been relationships. The cost would have been those tangible\u2014and I would argue they are very, very tangible\u2014benefits of goods and services and access to markets. That is a huge cost. So the Labour Party does support this piece of legislation. It is part of New Zealand\u2019s international tradition to be a plank owner, a foundation member, of these great international institutions.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000293\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EI think we can look back, and I do commend those who negotiated this\u2014being in on the ground floor has allowed us to have our say on transparency, to have our say on the structure, and to have our say on the governorship. As others have pointed out, Europeans and others look to this institution with respect. They would not do so if those fundamental arrangements were not in place. And, actually, by being a member of this institution\u2014again, although we are a small nation, we have a massive reputation\u2014I would argue it also gives some credibility and integrity to it. People would ask, if New Zealand and others in the region were not there: \u201CWhat are we doing? What is our purpose?\u201D. So I commend the bill to the Committee.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000294\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EI think it is sad that there was not a heck of a lot of public notice taken of it at the select committee, but it is a very, very important building block as New Zealand continues to play its part as a respected and mature developed nation throughout the world, given that we can contribute our expertise. We do not know everything, but we could contribute that expertise. We can continue to act as an honest broker and navigate countries through intricate and complicated procedures. This builds on that tradition.\u003C/span\u003E\u003C/p\u003E\u003Ca id=\u00226671c41a55b64bda9ec1e73381f699ea\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 1 be agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EAyes 109\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand National 59; New Zealand Labour 32; Green Party 14; M\u0101ori Party 2; ACT New Zealand 1; United Future 1.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENoes 12\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand First 12.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EPart 1 agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000295\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u0022d6c51c611ee24d2eaba2a61e95a59279\u0022\u003EPart 2  Membership of Infrastructure Bank\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022 data-id=\u0022c8a1e1f46ee14a7c960b95c3e6b57e95\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000296\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022c8a1e1f46ee14a7c960b95c3e6b57e95\u0022\u003EThe CHAIRPERSON (Hon Trevor Mallard)\u003C/span\u003E: This is debate on clauses 6 to 11. \u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022 data-id=\u0022408c8778d1964f769b184d2ab60418d5\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000297\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022408c8778d1964f769b184d2ab60418d5\u0022\u003EHon PHIL GOFF (Labour\u2014Mt Roskill):\u003C/span\u003E Part 2 of the International Finance Agreements Amendment Bill is about the membership of the infrastructure bank. It makes the substantive changes that enable New Zealand to become a member of the Asian Infrastructure Investment Bank. Again, I would like to talk about why we should become a member of the bank and why we are supporting this. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000298\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EIn that respect, just to touch on some of the comments made by my friend and colleague from the New Zealand First Party about whether this brings in only intangible benefits, I think Fletcher Tabuteau drew on the analogy that China would have traded with us anyway, so we therefore did not need to have a free-trade agreement with China. Well, I am sorry; that is absolutely wrong. I know that New Zealand First opposed that agreement at the time. But it was not about intangible benefits; it was about very tangible things in terms of removing the tariffs. Actually, making it tariff-free meant that you could increase your trade. Also\u2014and maybe not quite as objective but certainly as strong a factor\u2014there was the profile that it gave us. China always talked about the four firsts. That was in reflection of the relationship that we had with that country. That is why our exports went from $2 billion a year to over $10 billion a year. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000299\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EIt is the same thing for this agreement. What would have happened\u2014or what would happen\u2014if New Zealand was the only substantial country in the Asia-Pacific region that did not participate in this bank? What message would we be sending to our colleagues in the ASEAN region? The message we would be sending is that we did not care about their infrastructure needs, we were not really part of their region, and we did not have an interest in helping them with either the technical assistance this bank will give or with the infrastructure investment assistance. Next time we went along to one of those countries and said to it \u201COK, we\u2019d really like to develop this relationship. We\u2019d like more students, we\u2019d like more tourism, we\u2019d like to trade more with you.\u201D, it would scratch their heads and ask whether this is a country that is really committed to its region. It might still buy our products, but it would be less inclined to regard us favourably and to give us the benefit of the doubt at times when a relationship really demands that we need the benefit of the doubt. So I think you cannot simply dismiss our involvement and our commitment to the Asian Infrastructure Investment Bank as being something that is simply an intangible benefit. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000300\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EThe fact of the matter is that the greatest tangible benefit is that if we invest in this bank along with other countries that are giving the bank much more capital, we will help the development of those countries. They will develop their middle class and their taste for New Zealand products, and they will buy more products off us. To consider that New Zealand is an isolated island and can act without regard to the global environment within which we participate is a wrong view and, I believe, a naive view. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000301\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EWhat are the tangible benefits, then, of becoming a member of the bank, which is what this part of the bill is about. First of all, it is about increased economic development in the Asia region and the flow-on benefits that that will bring. Every study that has been done, including by other development banks like the World Bank and the International Monetary Fund, has said that there is a huge lack of capital for investment in infrastructure and that that is holding the region back. If they can get that capital, if they can develop, that makes the whole region better off, it makes it more stable, it makes it more prosperous, and New Zealand benefits. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000302\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003ESecondly, it is in support of increased integration of the region. When we did the international treaty examination at the Foreign Affairs, Defence and Trade Committee, that was a key point made by officials reporting to us on our national interests as to why we would benefit from participation in and membership of the bank. It also augments our existing relationships in the region. For years, speaking as foreign affairs Minister and trade Minister, we were actively involved in the region at ASEAN regional forums, at APEC meetings, and so on. It is critically important. The majority of our trade flows now not to Europe but to the Asian region. [Bell rung]\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022 data-id=\u0022c2036dad0bb64291852096209218a8f7\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000303\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022c2036dad0bb64291852096209218a8f7\u0022\u003EThe CHAIRPERSON (Hon Trevor Mallard)\u003C/span\u003E: I will give the Hon Phil Goff the call in a second, but\u2014I apologise to the members again\u2014I misdescribed the debate. We are now debating Part 2, which includes the clauses I mentioned but also the schedule. Given the size of the schedule, it is a fair proportion of the bill. \u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022 data-id=\u0022029f80c68ac04a4f81c47863dda2a7cf\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000304\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022029f80c68ac04a4f81c47863dda2a7cf\u0022\u003EHon PHIL GOFF (Labour\u2014Mt Roskill):\u003C/span\u003E We can indeed talk about the schedule. I thought we would be having a separate debate on the schedule\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000305\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022e41cdf526c2f47eebf660b7eabd56cca\u0022\u003EThe CHAIRPERSON (Hon Trevor Mallard)\u003C/span\u003E: No, we are not. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000306\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00222e9c49995c6e4f7d90f3f637f1c64fea\u0022\u003EHon PHIL GOFF\u003C/span\u003E: OK, so let me address some of those things too, because what is in the new schedule 8 in the schedule is important\u2014that is, the articles of agreement. It is 30 out of the 34 pages of the bill. It is, therefore, pretty critical. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000307\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EBut I want to also address one amendment that the committee made, which was to clause 9. Under clause 9 we deleted new section 8(1A). I want to talk about the reasons for that. New section 8(1A) basically gave article 19(1) of the articles of agreement the force of law in New Zealand. So a layperson reading this might ask why we would delete that. What article 19(1) does is prohibit members of the Asian Infrastructure Investment Bank from imposing restrictions on currencies held or used by the bank. That will still govern our actions anyway, but the advice that the select committee was given was that it was not necessary. This article and the restrictions that it imposes do not need to have effect domestically for us to still be bound by it, so it was not necessary for that to be included. Secondly, it would be inconsistent with all of our other agreements with other international financial institutions if we were to include that clause. So not too much should be read into the fact that that clause has been taken out. It is simply that it was not necessary and it would have been inconsistent. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000308\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003ECan I come now to the schedule of the bill, which is really important. First of all, article 1 sets out the purpose of the bill, which is to \u201C(i) foster sustainable economic development, create wealth, and to improve infrastructure connectivity in Asia by investing in infrastructure in other productive sectors;\u201D. Also, I think the second factor is significant\u2014\u201C(ii) promote regional cooperation and partnership in addressing development challenges \u2026\u201D. So that sets out clearly what the purpose of this bank is and why we would want to be a member of it. It makes it clear that membership is open to members of the International Bank for Reconstruction and Development\u2014that is, the Asian Development Bank, as we know it. It talks about the amount of authorised capital stock that the bank shall have. The sum set out under article 4 is some US$100 billion\u2014that is, US$100 billion. So what that gives us is a sense of the size of this bank and the significance that it will have in achieving the purpose for which it is set up. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000309\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EWe are investing in this bank, remember, because the Asian Development Bank and the World Bank were not meeting the level of demand in the Asian region for investment in infrastructure, and that US$100 billion is clearly large enough to make a difference. Article 5 sets out the way in which we make our subscription to the organisation, which is in five instalments each of which is 20 percent of the amount that we have to pay. That represents US$18.4 million a year. So it is a significant sum that we are contributing, but compared with the larger countries, like the US$30 billion that China is putting in, it is relatively small, but symbolically it is important, and that is deemed to be our fair contribution. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000310\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EArticle 13 sets out the operating principles, and I think it is important that the bank shall be bound by sound banking principles. If this bank was not going to operate according to those principles and if we had not been involved in the negotiation and we were not confident in that, then we would not be making this investment. So that is also pretty important. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000311\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EI want to touch on one other section, if I can find it, in terms of the election of the president of the bank, which is really important. It sets out the principle that the election should be by an open, transparent, and merit-based process. If we need to have confidence in the way that this bank operates, it needs to operate according to best international practice. I think the articles of agreement in front of us can give us that confidence\u2014\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022 data-id=\u00224258ab38134c4af18f8f0db7bb644e96\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000312\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00224258ab38134c4af18f8f0db7bb644e96\u0022\u003ESTUART NASH (Labour\u2014Napier):\u003C/span\u003E I would like to speak to Part 2 of this bill, and mainly to new section 3(3), inserted by clause 6(2), and new section 10(2)(da), inserted by clause 10(1). New section 10(2)(da) talks about schedule 8, which sets out the text of the Infrastructure Bank agreement, as Mr Goff alluded to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000313\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EI would like to say to Mr Tabuteau that I know he is not in agreement with this bill and he is not supporting our membership of this bank, but if New Zealand First is ever in a situation where it has the power to withdraw New Zealand\u2019s membership, it can be done. There are clauses, under chapter VII, \u201CWithdrawal and suspension of members\u201D, where a member can withdraw simply by delivering a notice in writing to the bank that we are gone. You get 6 months, and you are still liable for all the liabilities and promises that a country has made, but the bottom line is that I could not see a case where New Zealand would withdraw from such an agreement, especially when you look at schedule 8 and the articles of agreement\u2014why it is being undertaken.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000314\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EIf you look, for example, at schedule 8, \u201CArticles of Agreement of the Asian Infrastructure Investment Bank\u201D, one of the main ones is \u201Cto remove the financing bottlenecks faced by the individual economies in Asia, and will complement the existing multilateral development banks, to promote sustained and stable growth in Asia;\u201D. So this is not saying it is an either/or\u2014that a country applying for money from this bank has to choose between this bank and the Asian Development Bank, the World Bank, the IMF, etc. This is just filling a gap that is perceived\u2014well, not perceived\u2014it is acknowledged that it does exist.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000315\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EBut when we talk about New Zealand\u2019s membership, and this is what article 3 does\u2014approval is also given to the New Zealand Government to become a member of the Infrastructure Bank in accordance with the Infrastructure Bank agreement. There are a number of reasons why we would join this. We have talked about this before, but one of the things that surprise me is that people have said that the Americans, in particular, have seen this as China having undue influence over the development of the region. Well, the Chinese are incredibly smart as well. They understand that as citizens of the countries that are members of this bank will draw down funds to help their infrastructure move from subsistence living into consumerism, the Chinese ability to service that, and the Chinese economy\u2019s ability to grow, will grow along with these economies.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000316\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EAs mentioned, we are talking about Malaysia, the Philippines, Thailand, India, Viet Nam, and Uzbekistan\u2014there is massive growth potential in this region for all the countries that are investing in this bank. As I mentioned, Australia is, Great Britain is, but the United States is not. It is one of the main ones. But there are a number of New Zealand companies that may not only be able to take advantage of the growing consumerism in these economies but also be able to take advantage of the infrastructure development as it occurs. We know that there are a number of New Zealand companies and consultancies that are world-leading experts when it comes to the development of, for example, geothermal energy, cadastral mapping, and any number of other infrastructural projects that may be required or that may come from the funding from this bank to these growing economies.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000317\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EThe other thing also\u2014I always agree with Mr Goff, and I certainly do here\u2014is we have got to stand for something. If New Zealand said: \u201CWe only care about ourselves. We don\u2019t care what is going on in the rest of the world.\u201D\u2014and I am not talking about from an economic perspective; I am talking about a social perspective\u2014then that would go against what I believe is a very important part of our global brand and what we actually stand for in the global market, and that is for a fairer, more equitable society. We do know that infrastructure projects deliver the sorts of social outcomes required to move people from subsistence right through to consumerism. We only have to look at China to see what a developing economy can achieve in the space of a very short period of time. As mentioned, this is what we stand for.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000318\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EThe economic benefits to New Zealand of membership\u2014as one organisation used to say, there are benefits in membership. I think the benefits in this agreement or in being a member of this bank far outweigh the costs. Mr Tabuteau\u2014well, not only Mr Tabuteau, but a number of speakers have talked about the cost. It is only, I think, $156 million over 5 years\u2014Mr Goff?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000319\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00226fc5e68c1a9e43f58089d624aff77c75\u0022\u003EHon Phil Goff\u003C/span\u003E: Yes.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000320\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002239ee6e79f6874a2d9ce8f8cd32ef0172\u0022\u003ESTUART NASH\u003C/span\u003E: As Mr Goff pointed out, it is less than we are spending on the flag referendum. So the cost to New Zealand is minimal per year\u2014the cost to New Zealand is minimal, but I think the economic benefits are absolutely substantial going forward.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022 data-id=\u0022bc0ae817576747598c91cd46d1f44839\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000321\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022bc0ae817576747598c91cd46d1f44839\u0022\u003EFLETCHER TABUTEAU (NZ First):\u003C/span\u003E Not to labour the point, but everything that has been spoken of in these contributions I actually tend to agree with. Investment in China and in the neighbouring Asia-Pacific region is essential for the development of that region. I concur with the previous contribution from Stuart Nash that investment in infrastructure development in those underdeveloped regions will bring up the social capacity of those memberships. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000322\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003EWhat I wanted to point out, and what I still insist on, is that the underlying commitment on behalf of this Government to this infrastructure agreement bank is based on lies told to New Zealanders. The Government has sold off our assets and told us they would be used for New Zealand, but they are most clearly not being used for investment in New Zealand. That is our issue with this legislation. We cannot agree with the cries about what message it would send to China and what message it would send to the regions when we do not contribute. I contest that New Zealand First, as the name might suggest, is more concerned with what message it sends to New Zealanders when our commitment to this bank is based on lies from this Prime Minister. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000323\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003EI just want to finish my contribution with a very technical question to the Minister in the chair, the Hon Craig Foss. You will forgive me, Mr Chair. It is actually in relation to our commitments under the joint statement of principles of partnership. New Zealand is expected to ensure adequate consultation with Tokelau on any treaty, such as this one, that we are committing ourselves to. My understanding is we have not undertaken that consultation. I would be happy\u2014and I would hope\u2014if this could be proven to be incorrect. But we do have a commitment. I would like to understand what consultation has been undertaken on the part of this Government, because we are expected to do so under our own legislation when it comes to these financial trade agreements. So I put it to the Minister, and I hope I am proven wrong, that we have not consulted as per our obligations. I would be intrigued to know what that feedback from consultation is. Thank you for your forbearance, Mr Chair.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022 data-id=\u002218a5b9f684364ecd87712f5719d814aa\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000324\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002218a5b9f684364ecd87712f5719d814aa\u0022\u003EHon DAVID CUNLIFFE (Labour\u2014New Lynn):\u003C/span\u003E Thank you for this opportunity to contribute in the Committee stage on Part 2 of the International Finance Agreements Amendment Bill, and I reiterate that Labour is supporting the bill. Part 2 contains a number of operative provisions in clauses 6, 7, 8, 9, and 10\u2014and, importantly, clause 10 is the linking section that attaches schedule 8, which is the Articles of Agreement of the Asian Infrastructure Investment Bank. I will make only a brief point about clause 8, which is to note that subclause (2) inserts new section 5(e), which says \u201Call payments required to be made \u2026 to the \u2026 Bank under the terms of the Infrastructure Bank Agreement.\u201D, and new subsection (2), which says \u201CExpenses \u2026 may be incurred without further appropriation \u2026\u201D. I would like the Minister in the chair, Craig Foss, to clarify for the Committee whether that means there is a contingent liability risk on New Zealand beyond the US$92.3 million, I think it is, to which our initial contribution amounts; if so, what is the nature of that liability risk, and can he put a top-end quantum on it. I think it is important for the Committee to be aware of that.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000325\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003ETurning to new schedule 8, and with the preface that I understand that a former New Zealand Secretary to the Treasury Mr John Whitehead was instrumental in contributing to these articles of agreement, I say that it is clear that they have been carefully worked through, and I wish to turn in particular to the operating principles in article 13. This contains, I think it would be fair to say, a blend of banking principles and principles that reflect the international nature of the bank. The bank will be guided by sound banking principles; it will not finance any undertaking in the territory of a member if that member objects to such financing; it will pay due regard to the ability of the recipient to obtain financing on reasonable terms from other sources\u2014which I think is important, because what that says is that this bank is trying to fill in the financial funding gaps for Asian regional infrastructure not\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000326\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00226a27e5aeb3dc41388a6bdd6c8206eed4\u0022\u003EThe CHAIRPERSON (Hon Trevor Mallard)\u003C/span\u003E: I apologise for interrupting the member. I have been consulting with Standing Orders and I do want to talk to Mr Tabuteau about a comment that he made previously. I want to refer him to Speaker\u2019s ruling 48/2, which states: \u201CThe offence of calling another member a liar, or implying that another member of the House is a liar, is an offence against the House \u2026\u201D. It then goes on to make it very clear that that is not acceptable. I therefore require the member to withdraw the comment and to apologise.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000327\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00226857fdcd11824dcca38ec5c0a99f6e90\u0022\u003EFletcher Tabuteau\u003C/span\u003E: I withdraw the comment and I apologise.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000328\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00227d2dd85af8aa4ab0bb7ea3f7d387815a\u0022\u003EHon DAVID CUNLIFFE\u003C/span\u003E: Clause 5 of article 13 talks about the ability of the recipient to obtain financing from elsewhere, which goes to the point, as I said, that this is a supplementary or gap-filling fund, and that reflects us back on the earlier debate that we had in the first reading of this bill when we were debating whether the creation of this bank represented in some ways a vote of no confidence on the existing Bretton Woods institutions, and the sufficiency of the World Bank and the Asian Development Bank. From there that led us into a discussion of the relative interests of the United States as the sponsor of the Bretton Woods institutions and to reflect upon the rise of China as a very important country in the region, which had been the principal driver of the creation of this additional institution.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000329\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EI think it is important to turn to chapter V in the articles of agreement and, in particular, the governance section in articles 22, 23, 24, and 25. What that does is it separates out the composition of the board of governors from the board of directors, and I want to reflect upon those two different roles. New Zealand, in agreeing at the outset to be a founder member of the Asian Infrastructure Investment Bank, acquires a seat on the board of governors and an alternate governor if our regular member is not able to attend. That allows New Zealand to participate in exercising the powers under article 22, 23, and 24, which include appointing directors, and the powers thereof are set out later. It includes appointing under article 29 the president, and overseeing the role and functions of the bank.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000330\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EIt is instructive that in appointing the board of directors the governors are divided into two groups: nine shall be elected under article 25 by the governors reflecting regional members and three shall be elected by governors representing non-regional members, thus making it clear that in all ordinary circumstances it will be regional members who will hold the power of appointment over directors or the board of directors. That is significant because it goes to the point of the shifting balance of influence between the non-regional Bretton Woods powers and the regional powers that are largely sponsoring this initiative, but with whom New Zealand is pleased to associate on this occasion. The powers of the directors are set out in articles 26, 27, and 28 and it is important to note the allocation of voting under article 28. Founding members are allocated 600 founding member votes and then other votes that are proportionate to their financial contributions.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000331\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003ENew Zealand does indeed get a seat at the table of an important new institution. New Zealand does get visibility to governance\u2014or, at least, high-level governance\u2014documents. I guess in the articles of agreement we have yet to see the precise nature of the reporting from the board of directors to the board of governors and we would, of course, anticipate that it is mainly the directors to whom management information will flow. It will be very interesting to see\u2014and the Minister may wish to comment on that\u2014whether New Zealand as one of the smaller founding participants could expect to see New Zealanders on the board of directors of the bank. If that is not the case, could the Minister please let the Committee know the extent to which New Zealand will have visibility to reports and paperwork that are going to the board of directors as opposed to the board of governors. We would not want to see New Zealand in a situation where because it is on the higher-level appointment board but not on the day-to-day governance board, it loses some degree of visibility to the operations of the bank. So we would like the Minister to take a call on that point.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000332\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EThe Foreign Affairs, Defence and Trade Committee has commented on a number of the features of the founding documents of draft policies contained in the schedule. It comments, for example, on the innovative governance mechanisms and attests that the model has adapted from and learnt from the World Bank and the European Investment Bank, noting the non-resident board of directors, which is less expensive to operate, it says, than some of the models requiring resident investors. It notes that New Zealand advocated for open, transparent, and merit-based appointments and that the Asian Infrastructure Investment Bank agreed to write that into the articles of agreement, that the president is required to come from a regional member country, and that a range of other safeguards have been inserted. The select committee report notes that a lot of emphasis was put on ensuring that the bank has the right safeguards in place, including environmental, social, and procurement safeguards.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000333\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EI have a couple of notes on that. Firstly, the articles make clear that procurement can be openly conducted from any regional country, which includes New Zealand, so we would hope to see New Zealand contractors and service providers getting a share of procurement, and I invite the Minister to comment on whether the national interest analysis background documents contain any estimates of the value of the procurement flows in which New Zealand might be expected to participate. The select committee notes that it will be expected to collaborate with global and regional institutions, and I do believe that we are going to need reporting on that in the future. The Minister may wish to comment on how he expects to keep tabs on that issue, because there is both the potential for constructive gap-filling by the Asian Infrastructure Investment Bank and some degree of overlap and/or competition with the Asian Infrastructure Investment Bank and the World Bank. So exactly how the New Zealand Government would seek to form a view, given that it is on the board of governors of the Asian Infrastructure Investment Bank and the IMF - World Bank system, to tell whether those relationships are constructive or destructive would be a very important, I think, thing to consider.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000334\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EI turn the attention of the Committee to article 31, about the international character of the bank. I think there are some important safeguards there. Clause 1 of article 31 states: \u201CThe Bank shall not accept Special Funds, loans or assistance that may in any way prejudice, limit, deflect or otherwise alter its purpose or functions.\u201D It is important that its purpose, which is infrastructure and other productive development in the region, be underlined. There is a very important statement in clause 2 of article 31, especially given the controversy on its founding.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022659f6556-09a1-4ead-bc52-05cbdb4eaab8\u0022 data-id=\u0022e8d58188a9354239ae9cb0cd3a625f03\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000335\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022659f6556-09a1-4ead-bc52-05cbdb4eaab8\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022e8d58188a9354239ae9cb0cd3a625f03\u0022\u003EHon CRAIG FOSS (Minister for Small Business):\u003C/span\u003E Just briefly, I will answer a question the member had regarding Tokelau. Tokelau was informed of our intention, and feedback was sought from it regarding our intention to join the Asian Infrastructure Investment Bank. The member may know that Tokelau is not eligible to be a member as it is not a member of the Asian Development Bank or the International Bank for Reconstruction and Development, for his interest. Just quickly, I note that those shares will go on to the Crown\u2019s balance sheet as an asset, and any capital that could be called would be there as the member described, as a contingent liability. Thank you.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022 data-id=\u00228b1b249ac9e04b8da0126781c4fd90f1\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000336\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00228b1b249ac9e04b8da0126781c4fd90f1\u0022\u003EHon DAVID CUNLIFFE (Labour\u2014New Lynn):\u003C/span\u003E Thank you, Mr Chairman, I do appreciate your indulgence\u2014just to wrap up a couple of technical points in respect of the articles of agreement. Article 31(2) states: \u201CThe Bank, its President, officers and staff shall not interfere in the political affairs of any member, nor shall they be influenced in their decisions by the political character of the member concerned. Only economic considerations shall be relevant to their decisions. Such considerations shall be weighted impartially in order to achieve and carry out the purpose and functions of the Bank.\u201D \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000337\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EI really would like the Minister in the chair, Michael Woodhouse, to share with the Committee some examples of the policies that the New Zealand Government would be expecting to see implemented under that all-important provision, because for those, particularly in the western hemisphere, who have alleged that this new institution would be in some way a tool of creeping political influence, this safeguard would seem to weigh against that in a healthy and constructive way\u2014but, of course, it is only as good as its implementation. So, Minister, if I could turn your attention to that very important clause in the articles of agreement, clause 2 of article 31, how will we know\u2014how will the New Zealand governor know\u2014whether that has been implemented in practice and how will it service any concerns that might subsequently take place? \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000338\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EThere is a range of technical articles going on in chapter VII; in chapter VIII, around suspension and termination of operations of the bank; in chapter IX, around status, immunities, privileges, and exemptions; in chapter X, on various interpretive sections; and then in chapter XI, on signature and deposit, and ratification and enforcement provisions. Schedule A\u2014the schedule to the schedule\u2014commences on page 30, and then it sets out New Zealand\u2019s relative number of shares, which, I think, is interesting for us all to see\u20144,615 shares, being US$461.5 million. That raises a very important point, because, of course, earlier in this debate the House had been tossing around the number US$92 million, which converts to approximately NZ$140 million. Here we see that the actual liability is US$461 million, which is closer, of course, to 600 and something, or\u2014I have not got a calculator\u2014NZ$700 million. As they say in the language of governance, it is a non-trivial amount of liability. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000339\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EIt is instructive, I think, that that comes from the Future Investment Fund, a fund of some $16 billion, one-twentieth of which, approximately, would be covered by this liability or fully funded from it. That is a very significant proportion of the funds raised by the Government\u2019s so-called mixed-ownership model asset sales programme, the proceeds of which were repeatedly stated to be for the development of New Zealand infrastructure and New Zealand health, education, and social services. If this\u2014and it is a significant proportion of it; close to one-twentieth of it\u2014is instead to be allocated to the underwrite of the Asian Infrastructure Investment Bank, then we need to know exactly what benefits will flow to New Zealand. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000340\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EI would ask the Minister, through the chair, to comment on what estimates have been provided to the Government on the economic flows to New Zealand that pertain to this subscription. Will it be a measurable flow of procurement services to New Zealand service providers? Will New Zealand qualify for infrastructure projects within New Zealand using Asian Infrastructure Investment Bank funds? Mr Joyce in question time today was celebrating the Crown\u2019s investment of NZ$3 million in a harbour project in the Eastern Bay of Plenty. Would that project, which is designed in the first instance to service a marine farming project\u2014I think it is called Eastern Sea Farms, a large aquaculture project, which I understand is around 50 percent owned by Chinese interests\u2014qualify for Asian Infrastructure Investment Bank funding if the Government does not follow through on what it is quietly indicating may follow in time for the election, which is the balance of, I think, the $29 million or $30 million required to make that project happen? \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000341\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EThat raises, in turn, the larger question of whether other infrastructure projects in New Zealand would qualify for Asian Investment Infrastructure Bank funding. The Government seems very reluctant to do major economic development regional infrastructure projects, except perhaps some roads. But even those have been concentrated in semi-urban roads of national significance, and regional roading has often been put on the back-burner as a result. So I think that is an important question. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000342\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EWill New Zealand get consulting or service-providing contracts from the procurement streams of this bank; if so, do we have any idea how much? Will New Zealand service providers be eligible to provide infrastructure construction and expertise in third-party countries? Just for example, some of our State-owned enterprises are best world practice, I understand, in geothermal technology. Will that qualify; if so, what estimates have been made in our national interest analysis about the cash flow back to New Zealand? Because US$461 million of liability out of the Government\u2019s Future Investment Fund\u2014so-called\u2014is a big chunk of change. What are we getting for it? \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000343\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EThat is not to say that Labour opposes the bill. We support the bill, and I have taken some time to go through the articles of agreement to indicate provisions that we are, by and large, comfortable with and, indeed, New Zealand has materially contributed to. We are comforted with the proscription on political interference. We are comforted with the well-set-out transparency requirements and the layering of the role of the board of governors, on which New Zealand will sit, and the board of directors. But we ask exactly what level of transparency will be provided to the governors in terms of the operations of the bank as opposed to the board of directors, on which it is less likely we will sit, and what estimates have been provided to the cash-flow benefits to New Zealand. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000344\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EI have to say that, once again, the national interest analysis that was provided to the select committee was, kindly put, more qualitative\u2014well-written, but qualitative\u2014than quantitative. That is, there are no numbers in it. It says\u2014and the Foreign Affairs, Defence and Trade Committee has summarised\u2014that \u201CNew Zealand\u2019s economic future is linked to the Asia region,\u201D and, therefore, it is a good thing for us to participate. It is a very general argument, and in this Committee stage debate, drawing upon the articles of association, I think it is incumbent on us to try to get into the detail of that, so that we can see what attempt has been made by the Government to quantify those benefits. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000345\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EIt talks about, on page 3 of the Foreign Affairs, Defence, and Trade Committee report, connectivity to the market, beginning with the truism that \u201CNew Zealand is part of Asia,\u201D. Yes, of course it is, but that argument alone is not sufficient to justify our involvement in this. And it talks about our ability to influence, but even the national interest analysis does not go into the point we have just made in these contributions that we sit on the board of governors, but not necessarily the board of directors, and that therefore there is a limitation on the influence that we can bring to bear. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000346\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003ESo on both the financial and the non-financial returns, I would ask the Minister in the chair to take a brief call. What quantum has been provided to the Government in terms of financial returns to New Zealand service providers and what level of transparency pertains to the governors, as opposed to the directors, on the strategy, direction, and operations of the bank? Thank you.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022 data-id=\u00221b645b6c5ea74ad9b5be118b0ba6d072\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000347\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00221b645b6c5ea74ad9b5be118b0ba6d072\u0022\u003ESTUART NASH (Labour\u2014Napier):\u003C/span\u003E Mr Cunliffe does bring up an interesting point. Mr Cosgrove and I alluded to it, but, you never know, it could arise. Under article 2, \u201CFunctions\u201D, in clause (iii) of new schedule 8, it actually says the fund is to \u201Cencourage private investment in projects, enterprises and activities contributing to economic development in the region, in particular in infrastructure and other productive sectors, and to supplement private investment when\u201D\u2014and this is the important part\u2014\u201Cprivate capital is not available on reasonable terms and conditions;\u201D. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000348\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EI suppose there could be an argument that why would private capital invest in a wharf in\u2014\u014Cp\u014Dtiki, did you say, Mr Cunliffe? [Interruption] In a wharf in \u014Cp\u014Dtiki. If the Government backs down from saying we will not invest in this, and yet there are defined social and economic benefits for that reason, then I suppose there is nothing stopping\u2014I do not know whether it would be the \u014Cp\u014Dtiki District Council, or whatever, applying to the bank, and I assume it probably has to be through the New Zealand Government, for funds to build this wharf, on reasonable terms and conditions. And again, what defines reasonable terms and conditions? They may look at the New Zealand market and say: \u201CWell, there\u2019s a risk premium in this and, therefore, it\u2019s going to get quite high interest rates.\u201D Or, then again, it could be at the rates that you borrow money from a bank in China that has negligible interest rates. Who knows? I mean, I find it difficult. It is an interesting proposition, but you never know, it might occur. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000349\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EWhat I would like to look at is schedule A of new schedule 8. This lists the countries and the number of shares and their capital subscription to this fund. And it is interesting, because there are 37 regional countries and there are 20 non-regional members that have decided to contribute money in varying amounts to this fund. It really goes to show that, according to the amount of money going in, there really has been a gap in the funding infrastructure or in the funding mechanisms to really drive infrastructural growth forward, hence the need for this bank, because, as a number of speakers have alluded to, America has been dead against this because it thinks the old institutions already fit the bill. But I would suggest that by looking at the countries that have invested in this, perhaps America is on a little bit of a limb when it believes that, in fact, there is no need for such a bank. Time will tell. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000350\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EBut let us have a look at some of these countries. Let us start at the top: Australia. When we say that one of the Americans\u2019 concerns about this is that the governance would not be up to scratch, there are a number of countries here that would not go near this if they believed that the infrastructure or the governance arrangements for this bank were anything but absolutely first-class and in line with the expectations of developed countries. So we have got Australia. Australia is actually putting in $3.69 billion. That is a lot of money. The reason why I think Australia is putting so much money in is\u2014well, it has said it is very much part of this region. It is very keen to see these markets grow because, being a commodity producer, it needs to move its economy from pure commodities towards finished goods and other products, and it sees this market as a very important one. So it is putting in $3.69 billion. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000351\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EAzerbaijan is putting in $254 million. I am not even too sure where Azerbaijan is. I know it is part of the old Soviet Union. I had to ask Mr Goff, who I think has been to 190 of the 192 countries that exist in the world.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000352\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00220b1eb2c326a248f0bb4ddaa6be39619d\u0022\u003EHon David Cunliffe\u003C/span\u003E: It\u2019s warm and dry.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000353\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00224a3bba07a9ef4f8e915620beabd784aa\u0022\u003ESTUART NASH\u003C/span\u003E: It is warm and dry. Even Mr Goff said it is one of the very few countries\u2014one of about three countries in the world\u2014he has not been to. But it has decided\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000354\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00229352188c4afc474496a223ba8a8a35e9\u0022\u003EHon Phil Goff\u003C/span\u003E: They used to test nuclear weapons there.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000355\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022eb1a2ec5a02c4fb29b59b2500b92c582\u0022\u003ESTUART NASH\u003C/span\u003E: Oh, did they? Well, they have decided that they need to diversify their economy\u2014their part of this region. They are actually putting in $254 million themselves. I do not know how big the economy of Azerbaijan is, but I suspect it is not particularly developed.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000356\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022eaf79431-1033-44f1-a633-22633da52c0d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00222c2c0343ac0f4e92b5eb3b2c9a2fbe10\u0022\u003EDavid Bennett\u003C/span\u003E: It\u2019s oil, mate. It\u2019s oil.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000357\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00227f6aae218d0b4144ab4bdbf819c4d3ae\u0022\u003ESTUART NASH\u003C/span\u003E: It is oil? Well, Mr Bennett knows a lot about it, but I would suggest that this is a substantial amount of money or a substantial commitment from an economy that understands the value of development. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000358\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EBangladesh\u2014keeping in mind that we committed US$461 million\u2014has committed US$660 million. Bangladesh is a country we tend to see in the newspaper when there is a massive flood that wipes out villages and causes great devastation. It understands the implications of such a bank, and I suspect places like Bangladesh will actually benefit substantially from the infrastructural development that will go on in the region, and it may well happen in its country. It is committing US$660 million. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000359\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EBrunei\u2014[Bell rung] Mr Chair, there are a few more countries.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000360\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b91f9fcc8ccd45d0b63b7cba564c4515\u0022\u003EThe CHAIRPERSON (Hon Trevor Mallard)\u003C/span\u003E: I am slightly stretched on the relevance. It is not National Geographic.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000361\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022c6f2626472af44448c31305d6f025bb5\u0022\u003ESTUART NASH\u003C/span\u003E: Well, I am talking about schedule A here. OK, well, what I will do is talk about how some of the really big economies see the development of this and understand the value of development in this region. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000362\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EWe have got China. I mean, we all know that China is one of the driving forces behind this. It is the world\u2019s second-largest economy, and in my view it is not long before it is the world\u2019s largest. But is it putting in nearly $30 billion. Close to 30 percent of all the money committed to this is being put in by China. India is putting in $8 billion. And, again, I suspect that India will be a recipient of a lot of the development that goes on in the region because, you know, it is a country that is on a fast track to developed nation status. Indonesia is putting in $3.3 billion. Even Iran is putting in $1.5 billion. So, as we can see, this certainly is not an American-backed or a Chinese-backed alliance when we have got countries like Iran\u2014Israel is putting in $749 million, which is interesting. Israel comes below Iran in the schedule. I think it is probably the only time you will see them side by side. We have got Korea putting in $3.7 billion. Turkey is putting in $2.6 billion. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000363\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EBut it is not only these countries within the region that are putting in a substantial amount of money\u2014it is about three-quarters, or $75 billion. Well, it is three-quarters of all the money heading into the fund. But the interesting thing, for me, is the non-regional members that are actually putting in a substantial amount of money. These are the ones that recognise the absolute potential for their own domestic markets in growing the Asia-Pacific market. We have got Brazil, which is putting in $3.1 billion. Heaven knows it is spending a lot of money at the moment developing Olympic stadiums and that sort of carry-on. That should be a good tournament. We have actually got France, which is putting in $3.3 billion and Germany is putting in $4.4 billion. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000364\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003ESo when the Americans had concerns about the governance or the arrangements or the legitimacy of this bank, I suspect that it is one of very few countries in the OECD that has such concerns. When Germany is committing $4.4 billion to this bank, then you know that there is something going on. Italy\u2014$2.5 billion. We have even got Luxembourg committing $69 million. Again, I do not know the size of the Luxembourg economy, but I suspect\u2014well, I do know it is not a particularly big one, so $69 million is a lot of money for it to put in. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000365\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EThe last thing I would say is there are just a couple more economies from outside the region that are putting in a billion dollars or more. They are the Netherlands, Spain, and the United Kingdom. The United Kingdom is putting in $3 billion. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000366\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EI suppose the point I am trying to highlight is that this should not be seen as just a regional bank funded by regional players for the benefit of just our regional and local economies. This is a bank that has international buy-in. I think it will play a significant part in the coming years of the development of the economies that are actually going to drive growth within our own economy and, certainly, the region. That is why I am supporting the bill and I am very pleased to support it. Thank you very much.\u003C/span\u003E\u003C/p\u003E\u003Ca id=\u0022fe1ed05968c8490e93f17cbdb7242f43\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 2 be agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EAyes 109\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand National 59; New Zealand Labour 32; Green Party 14; M\u0101ori Party 2; ACT New Zealand 1; United Future 1.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENoes 12\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand First 12.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EPart 2 agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000367\u0022\u003ESchedule agreed to.\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000368\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u002288ef1cbec53d4e0594eac3b466fc1ffb\u0022\u003EClauses 1 to 3\u003C/span\u003E\u003C/p\u003E\u003Ca id=\u00226abdec945cc14ea9a80ba50ba654f622\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 clause 1 be agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EAyes 109\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand National 59; New Zealand Labour 32; Green Party 14; M\u0101ori Party 2; ACT New Zealand 1; United Future 1.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENoes 12\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand First 12.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EClause 1 agreed to.\u003C/span\u003E\u003C/p\u003E\u003Ca id=\u0022772c44c5a08240ea9e4096c1ed32e0ea\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 clause 2 be agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EAyes 109\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand National 59; New Zealand Labour 32; Green Party 14; M\u0101ori Party 2; ACT New Zealand 1; United Future 1.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENoes 12\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand First 12.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EClause 2 agreed to.\u003C/span\u003E\u003C/p\u003E\u003Ca id=\u0022711d1858b5144a9a96e5cfc961ec99f8\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 clause 3 be agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EAyes 109\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand National 59; New Zealand Labour 32; Green Party 14; M\u0101ori Party 2; ACT New Zealand 1; United Future 1.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENoes 12\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand First 12.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EClause 3 agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000369\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=\u0022id201511106fb25f893e954ed5af8f886e805377f3000370\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u0022e51278f39a1c405fbab6da87bff3af87\u0022\u003ETaxation (Bright-line Test for Residential Land) Bill\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000371\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u002230f4b2bfa5f149ae88c9bc348f1d5c41\u0022\u003EIn Committee\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000372\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u00225a59df560839415097cfa6d3979f1387\u0022\u003EPart 1  Amendments to Income Tax Act 2007\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022 data-id=\u002214906feaab774567945b1fd59d699bb0\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000373\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002214906feaab774567945b1fd59d699bb0\u0022\u003EHon CLAYTON COSGROVE (Labour):\u003C/span\u003E To just put on record, it is the Labour Party\u2019s position that we support measures to cut property speculation. However, we would argue that this piece of legislation is not only weak but it has been done in haste. It will not achieve the objectives it sets out to. In fact, I suspect and I predict that we will be back here before the end of the parliamentary term, amending legislation.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000374\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EI want to use an example, in terms of the lack of coherence and the problems associated with this bill, and turn directly to clause 15(9): the part of the definitions that deals with the \u201Cmain home\u201D. I want to quote from an article of 9 November 2015 from one Terry Baucher, who is an accounting expert, who said: \u201CWe do not believe that the introduction of a bright-line test for residential land is sound tax policy.\u201D Now, that was not a quote from Mr Baucher; that was from the Chartered Accountants Australia and New Zealand\u2014that is CANZ\u2014and was the opening sentence to its submission to the Finance and Expenditure Committee on this bill. If you look at clause 15(9) as an example of a lack of coherence and one definition, I think, that one could shoot peas through, it talks about the \u201Cmain home\u201D meaning for a person: \u201Cthe 1 dwelling\u2014(a) that is mainly used as a residence by the person (a \u2018home\u2019); and (b) with which the person has the greatest connection, if they have more than 1 home.\u201D\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000375\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EI would like to start by asking the Minister in the chair, the Hon Michael Woodhouse, and through him his officials, how on earth officials are going to be able to police that \u201Cthe greatest connection\u201D. Is there going to be some sort of levitation, or is the Inland Revenue Department going to sort of find its softer side and start judging people\u2019s feelings and how they define their connection with their main home? The Minister has said in his statement about this bill that \u201Cthe bill will ensure that people pay their fair share of tax\u201D, and \u201Cby supplementing the current intention test in the Income Tax Act it will make rules simpler for taxpayers to understand, and easier for the IRD to enforce\u201D.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000376\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EYet, if you look at the counterargument put forward in the officials\u2019 report to the Finance and Expenditure Committee, in the submissions of both the Chartered Accountants of Australia and New Zealand and Ernst and Young, they say: \u201CThe Government could achieve its policy objective by supplementing the \u2018intention test\u2019 more simply and coherently by amending section CB 6.\u201D They go on to say that the \u201Cdifferences between the brightline test and the current land sales rules are likely to increase uncertainty and cause confusion\u201D. So, on the one hand, you have got the Minister who says that this piece of legislation will be nirvana, will create a simpler regime for taxpayers, and will ensure that there is certainty. Then you have the experts\u2014and I know Mr Bennett, who chaired the committee, is, I think, actually a chartered accountant or from the profession. So I am going to be really interested in the contribution of that learned member, who, I am sure, knows far more about this legislation than anybody else in the House, and whether he joins with Ernst and Young and the Chartered Accountants Australia and New Zealand, who say this will cause increased uncertainty and cause confusion. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000377\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EThe basic principle of tax policy, as I understand it, is that it has to be simple, it has to be clear and transparent, and, generally speaking, not retrospective\u2014as parts of this legislation are. I would be grateful if the Minister could tell us how the Inland Revenue Department is going to judge a person\u2019s \u201Cmain home\u201D in terms of clause 15(9) and the person\u2019s \u201Cgreatest connection\u201D. What are the criteria for that? How is that going to be defined so that people have certainty and so that this legislation will not create confusion, and will stand up to the basic rudimentary analysis that one would expect, perhaps, from a court of law?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000378\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EThere are other exemptions dealt with in this legislation\u2014for instance, farmland. I would like the Minister to take us through the definition of \u201Cfarmland\u201D, in terms of the definition of exemptions around farmland. For instance, what is the situation where a farm has a number of houses situated on it\u2014perhaps for the farm manager per se. How is that going to be dealt with in respect of this legislation?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000379\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EI would also like the Minister to outline for us why it was that the Government did not take Treasury advice and put in a brightline test of 2 years rather than the brightline test that was suggested, that being 5 years. A number of submitters have said that the unintended consequence of this 2-year brightline test\u2014well, maybe it is the intended consequence from the Government\u2014is that those that the Government purports, allegedly, to be going after, and that is the speculative community, will change their behaviour and will simply hold for 2 years and move after that.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000380\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EWhereas one of the consequences\u2014and where this will actually whack people\u2014is if there is a death in the family, an unintended consequence of somebody losing their job, hardship per se, which is not dealt with in any way, shape, or form in this legislation, that person may well be forced to sell their home inside the 2 years because of the change in their personal circumstances around hardship; where you will get, I suspect, inequity. A number in the accounting profession\u2014remember, the Law Society also opposed this, not only the chartered accountants\u2014raised this issue. Nowhere in this bill is it dealt with. So I would like to ask the Minister what happens to Mr and Mrs Bloggs if there is unintended hardship. Say they do lose their job, somebody has cancer, there is a death in the family\u2014name a number of scenarios that you like\u2014and they are forced to liquidate in order to survive. Where is that dealt with in this legislation? Because it is not.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000381\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EAnd why was it that the Government refused the Treasury advice to make the brightline test 5 years? I suspect we know the answer, and the answer is that this is really a fictitious piece of legislation. It is designed, as many actions of the Government are, to make it look like it is doing something about property speculation in Auckland, because after years of this side of the House putting its feet to the fire, and public opinion growing and growing and growing, the Government has woken up, read its polls and said: \u201CHey, we\u2019d better be seen to be doing something.\u201D\u2014seen to be doing something. And so, it has said: \u201CLook, we\u2019ll bang out a 2-year hold.\u201D Let us get real about it. If you are making 17 to 20 points per annum, as many people are in Auckland, in terms of capital gain, well, you are going to hold for 2 years. Why would you not? Where are you going to get a better return than an Auckland property anywhere in the economy?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000382\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EBut if you are Mr and Mrs Bloggs who fall on hard times and something happens in your financial arrangements, and you are forced to sell within that 2-year period, you get whacked, whereas many submitters in eminent accounting firms and others pointed out that the inequity will be a change in behaviour by the speculative community, which will simply hold on for 2 years and then do what it has always done. And, as noted in the submissions that I read out by Chartered Accountants Australia and New Zealand and Ernst and Young, if the Government was really serious about tackling this issue, it would deal with and strengthen the intention test\u2014which is as loose as, today; in fact, the Inland Revenue Department has lost court cases around it\u2014and it would actually deal with that. But that intention test, which could be defeated by simply saying: \u201CWhat was your intention in buying the property?\u201D. \u201CWell, my intention was to move to Auckland, but then my partner changed their mind and said they didn\u2019t want to move to Auckland, so we sold.\u201D That, in law, is very, very difficult to defeat\u2014extremely difficult.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000383\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003ESo why is it\u2014and what is the meaning of \u201Cgreatest connection\u201D in terms of the \u201Cmain home\u201D? That would be a really interesting one to do. Maybe the Inland Revenue Department is going to, as I say, get the softer side going, do a bit of levitation, and work out what people\u2019s feelings are towards one of the residences that they deem to be their main home. How is that actually going to work in practice? Because you could shoot peas through that definition. So those are some of the questions, as we go through this shambolic piece of legislation\u2014\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022 data-id=\u00223ba2e40bd5314ac69c6bfa7493aa081f\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000384\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00223ba2e40bd5314ac69c6bfa7493aa081f\u0022\u003EJULIE ANNE GENTER (Green):\u003C/span\u003E I rise to speak on the Taxation (Bright-line Test for Residential Land) Bill. The Green Party is supporting this bill, but we do have great misgivings, as the legislation could be substantially better and have a greater impact in terms of reducing the problem of unaffordability in the Auckland housing market. To that, I will be putting forward two amendments today to try to improve this legislation, and I would like to speak to those Supplementary Order Papers more in detail, but I will start just by stating why it is important\u2014why this bill is important and why dealing with the Auckland housing crisis is important. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000385\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EIt is important because every New Zealander has a right to live in a warm, safe, secure, affordable home. Every child in New Zealand should have a warm, dry, secure, affordable place to call home, and that is increasingly out of reach for a number of low-income Aucklanders, and people elsewhere in the country. We have had problems with unaffordability in Christchurch. So, for the Green Party, we know that we cannot build a prosperous society if people do not have a place to call home, and it is of utmost importance that we prioritise that as a society. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000386\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EBut there is a second reason why it is important, and that is the financial stability, economic stability, and health of the country. The fact is that the Auckland house price crisis is a major risk to the financial stability of the country, and that is why the Reserve Bank, in particular, and many others, have been very, very concerned about Auckland house prices. If we have a bubble and it collapses, there will be consequences for the New Zealand economy. It is quite possible that it would be enough to send us into recession, even if our banks are solvent. There would be enormous economic repercussions, and, of course, the faster house prices increase, the harder they fall when the bubble finally does pop. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000387\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EAnd, of course, we know that many people have been asking the Government to act on this issue for a number of years. The Green Party has been calling for a levelling of the playing field of property with other investments and other income through a capital gains tax since at least 2002, if not before that. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000388\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EWe know that in 2010 Treasury pushed very hard for a comprehensive capital gains tax, and that was its preference. A capital gains tax would still be our preference as a fair way to deal with it. If one earned income because one bought a house that then increased in value over a period of time\u2014if that is an additional 100 grand or 200 grand, as may be the case in Auckland\u2014why should one not pay tax on that income, just like nurses and doctors and builders and teachers pay tax on their income? It is only fair. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000389\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EBut back in 2010, when Treasury pushed this National Government hard to implement a capital gains tax, it also proposed a halfway house, or a kind of compromise measure, which was the brightline test. At that point, the brightline test was designed as being 5 years, which is the minimum amount of holding period for the vast majority of OECD countries that have similar laws. Unfortunately, the legislation we have before us today is not 5 years\u2014it is 2 years\u2014and I will be putting forward an amendment to extend it to 5 years because, as we heard from submitters, a longer period would be much more effective at achieving the stated objectives of the bill, and it is the norm in OECD countries. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000390\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EOf course, if National had actually acted on Treasury\u2019s advice back in 2010, we might not have the problem that we do today to quite the same extent. The average house price in Auckland in October 2010 was about $530,000; now the average house price is $918,000, as of October 2015. So during that 5-year period, when there was total inaction from this Government, we had an increase of nearly 75 percent in the average house price in Auckland. That is an almost $400,000 increase for each house, and, of course, if that change in value is realised by people who are buying and selling properties during that period, all the money they earned on that will, of course, be completely tax-free.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000391\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EAnd so why would people not invest in the housing market in Auckland? The Government is sending the signal through the tax treatment on property that that is where they should put their money, even though it means that it is harder for families to afford homes in Auckland and it is a risk to the financial stability of the country. So I understand why people who have invested in homes may not want to pay tax on their income, because currently they have got quite a sweet deal, but it is not what is in the interests of the country as a whole\u2014to not deal with this problem. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000392\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003ESo to the legislation before us today. I was very disappointed, and I think it is safe to say that virtually every submitter who came to talk to us was disappointed in the legislation as it was drafted. We simply did not have enough time. Even though the Government has known about the problem and has been advised by Treasury to act on it for over 5 years, the legislation, when it finally came before the Finance and Expenditure Committee, had a curtailed process. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000393\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EWe had a shortened period for hearing from submitters. We had a number of questions that we put to officials that they really did not have adequate time to address. Therefore, the legislation, I think, is really lacking, and is not the best it could be. We heard from a number of submitters that it is incredibly important that legislation, particularly tax legislation, be coherent and consistent, and this bill does not meet that test. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000394\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EOne way in which it does not meet that test is that, supposedly, the bill is meant to buttress the intentions test. The intentions test has a 10-year period and applies to all land, but this bill before us today, the Taxation (Bright-line Test for Residential Land) Bill, applies only to residential land. This is problematic in several respects, and a number of submitters stated this during the hearings of the select committee. Firstly, it is difficult to define residential land. This is going to be very problematic, and I am not sure that those on the select committee, particularly Government members and officials, really understand just how difficult it is going to be to define land. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000395\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EWithin the bill it refers to the zoning of the land as a test as to whether or not it can be residential. The truth is that under the Resource Management Act pretty much any type of land, whether it is zoned industrial, commercial, or mixed use, could be used for residential purposes if the applicant applies and gets a resource consent. So because of the way our resource management law works, it assumes that you can pretty much do whatever you want if you have got enough money and enough lawyers to apply for the resource consent and get it from the council, which is a pretty high bar, admittedly. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000396\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EI think it is going to prove very problematic, because there is a huge amount of land that is being land banked by speculators on the anticipation that eventually it will be available for residential use, but it is currently not used for residential purposes\u2014it is currently farmland or industrial land on the outskirts of Auckland. So I think we are going to have a problem with the definitions. My proposal to solve that problem with the definitions is simply to stop having the distinction. Why would we want to have a distinction about residential land? It does not matter what the land is used for. It is simply clearer if it applies to all land. If there is not a problem with speculation in commercial land, industrial land, or farmland, then it is not going to be a problem.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000397\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EThe intentions test applies to all land; certainly, this legislation should apply to all land. It removes a potential loophole by which suddenly other types of land may become a problem. Because we have got the law applying only to residential land, there may be sudden demand for property speculation in any type of land that is not residential and that is within the vicinity of Auckland and that is used for other purposes. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000398\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003ESo I think that it would simply make it a much clearer piece of legislation, it would help better address the purpose of the bill, and it would not create any loopholes. Certainly, I think we heard from most submitters that they agreed that it would make more sense, if the bill was going to pass, that it apply to all land equally, not just residential land, and then we no longer have this problem with the definitions. I really do think it is going to prove very, very difficult to isolate what is residential land and what is not, because, theoretically, land use can change\u2014it does change, all the time, and particularly in fast-growing urban areas like Auckland. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000399\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003ESo my Supplementary Order Paper today, which I would ask members of the Committee to consider voting for to improve the bill, is Supplementary Order Paper 139. What that does is it removes the references to residential land so that the bill applies to all land. The other Supplementary Order Paper I will be putting forward is Supplementary Order Paper 138, and that is to extend the time frame from 2 years to 5 years. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000400\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EOne of the criticisms we heard from submitters during\u2014\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022 data-id=\u002250f285f1a0104a50a8e37a77b5a18af6\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000401\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002250f285f1a0104a50a8e37a77b5a18af6\u0022\u003EHon PHIL GOFF (Labour\u2014Mt Roskill):\u003C/span\u003E The Government has introduced a half-hearted and ineffective measure that will not achieve any of the goals that it says that it is setting out to achieve. It will not stop speculation. Treasury itself made that very clear in its report to the Finance and Expenditure Committee. What it will do is mean that the speculator will sell 2 years and 1 day after they have purchased the property. It will not achieve the goal of cutting out the rampant speculation that plays a role in forcing up house prices in Auckland at the present time in a totally unprecedented manner. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000402\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EHouse prices have gone up $180,000 in the last year in Auckland\u2014$180,000, which is more than $3,000 a week. Is this a bill that shows the Government is on the side of the family home buyer? No. This is a bill that shows that, despite what the focus groups say it should be doing, this is a Government that is on the side of the property speculators, who fund so many of the National Party\u2019s election campaigns. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000403\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EWill this bill stop the exorbitant inflation in house prices? The answer from everybody making submissions to the select committee was that it will not do that. It will not reverse the situation where we have the lowest homeownership rate in the country in 64 years and where 57 percent of Auckland adults are renting because they cannot afford to buy their own home\u201457 percent of Aucklanders are renting.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000404\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00225e6b7aaa-8157-4d5e-9940-1bdbcd61ae95\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002229b3a36b92a745e7877bb6d1cb04cfab\u0022\u003EAlastair Scott\u003C/span\u003E: What\u2019s the problem with renting?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000405\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002208e9494925294d07ba471e8b44a67029\u0022\u003EHon PHIL GOFF\u003C/span\u003E: I will tell you what is wrong with that. Most New Zealand families have the dream\u2014the Kiwi dream\u2014of being able to have a home they can call their own. That is what most Aucklanders still want. This bill will not achieve that outcome. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000406\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EWhat this bill does do is make one half-hearted admission\u2014and it is in the regulatory impact statement\u2014that I have not heard in 6 years from this Government. It says: \u201CThe Government is concerned with high house prices, particularly in the Auckland area. Property speculation is seen as one of a number of causes of the current prices.\u201D I thought it was the Resource Management Act\u2014that is all Nick Smith ever talks about.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000407\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002215702288fc2e4039a9e46fa11382cc43\u0022\u003EPhil Twyford\u003C/span\u003E: Or the council.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000408\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00225dedf3cc42f04654bc8a8393860d4844\u0022\u003EHon PHIL GOFF\u003C/span\u003E: I thought it was the council\u2019s fault. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000409\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EFinally, the one worthwhile thing in this bill, and why we will probably support it, reluctantly, because it is better than nothing but only just\u2014only just\u2014is an acknowledgment that property speculation is playing a role in forcing up house prices, causing a housing bubble, and stopping New Zealanders achieving what everybody in this Committee has as part of their Kiwi dream, which is owning a home of their own. But it will not work. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000410\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EThe regulatory impact statement says why Part 1 of this bill will not work, because the regulatory impact statement identifies what the actual problem is with the Income Tax Act. This is a quote from the advisers to the Government. Why did it not listen? The regulatory impact statement says the intention test\u2014that is the test at the moment. You pay tax, if you are speculating, only if you intend to sell the property afterwards. And do you know what the regulatory impact statement says? It says it \u201Cmakes gains from the sale of land taxable when bought with an intention of resale. This \u2018intention test\u2019 is difficult to enforce due to its subjectivity.\u201D It says the test \u201Cis particularly difficult to enforce in relation to residential property\u201D. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000411\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EWe have an Income Tax Act that is not working. We have people speculating on property and not paying their tax. That is hundreds of millions of dollars in tax avoidance. But what will this bill achieve in terms of cutting off that tax avoidance? Do you know what it says it will achieve? \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000412\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ce8e25aa277f48378c215a33d2f06aff\u0022\u003EHon David Cunliffe\u003C/span\u003E: $5 million.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000413\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022e28cd23868654ba9ab9c169abd29174d\u0022\u003EHon PHIL GOFF\u003C/span\u003E: $5 million a year. You know, that is probably the capital gain on one house in Kohim\u0101rama. It is ludicrous. That admission in this regulatory impact statement shows the nonsense of the Government\u2019s claim that this bill is going to achieve anything at all. This bill will not achieve that. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000414\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EThe other problem with this bill is that it did not follow\u2014and we are talking in Part 1 about the Income Tax Act. There is a particular procedure that is always followed when there is an amendment to the Income Tax Act. Income tax law is incredibly complex and it is prone to having unintended consequences. What normally happens is there is a discussion paper. It goes out to the experts, they chew through it, they come back with recommendations for change, and then it comes into the House. Then there is a period of 7 or 8 weeks, at least, for people to make considered submissions on the process. Did any of that happen with this bill? The answer is absolutely not. It was introduced as part of the Budget for political reasons, because National\u2019s polling and its focus groups showed that the public is disgusted that this National Government is not doing anything about property speculation\u2014about people making money without paying their fair share of income tax. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000415\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EWhy is it that the cleaners who clean our offices tonight, on their low minimum wages\u2014barely enough to scrape together a subsistence income\u2014will pay tax on every dollar that they earn, and the people who are making hundreds of thousands of dollars a year on each property they speculate on will pay no tax at all? Why is it that that is fair? Why is it that that is just? Will this bill do anything about it in Part 1? The answer is no. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000416\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EDo you know how long people were given to make submissions on this bill? It was about 10 days\u201410 days for a complex piece of legislation. When the people who know something about tax law went to the select committee\u2014the chartered accountants, for example; the Law Society; KPMG\u2014every one of them said that this legislation would not work and that this legislation would not achieve its objectives. They said that if the Government was going to catch anybody with this legislation, it was the person who sold for genuine reasons, not the speculator, because the speculator can hold on for 2 years and 1 day, and the person who has to sell because of financial difficulties cannot do that. Those submitters damned this legislation. They said that it was incomprehensible. They said that you needed better enforcement of the existing rule, not this piece of legislation. This legislation is political trash, according to those submitters. It does not do what the Government claims needs to be done. It will not achieve its purposes. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000417\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EThe chartered accountants said that speculators will not change their behaviour to hold a property just longer than 2 years, and that is why I support what Julie Anne Genter has put before the Committee, and I support what Treasury said we should be doing, which is 5 years. With 5 years you might deal with some of the speculators; if it is 2 years, they will hold on. They will hold on and they will make a lot of money in a short period of time, and they will pay no tax on it. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000418\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EThis bill will not help people achieve homeownership. This bill will not stop rampant house price inflation. This bill will not require people to pay the tax that they ought to pay on income that they are earning and the sort of tax that every other decent, hard-working New Zealander has to pay. This bill is not much better than a speculators\u2019 charter, and Government members should hang their heads in shame that they bring something so inadequate into the House when in my city\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000419\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022eaf79431-1033-44f1-a633-22633da52c0d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022504efd99b03c4b1e80aad6af8df70f73\u0022\u003EDavid Bennett\u003C/span\u003E: Your city\u2014what city?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000420\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00220a575ad4fc3f4f22b6dea4a4a8d8aeb4\u0022\u003EHon PHIL GOFF\u003C/span\u003E: \u2014yes, the city I live in and I am proud of; that city\u201457 percent of Aucklanders cannot buy a home of their own. More than half of the adults living in Auckland cannot achieve the Kiwi dream of homeownership, and what does the Government do in response to that? It says \u201CThere\u2019s a political problem out there. Let\u2019s flossy something up so that it looks like we\u2019re doing something.\u201D, but it has come back with a piece of legislation that actually achieves very little. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000421\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c699e7c6-53b9-470c-a14a-378cb6fc8a04\u0022\u003EIf it were not for the symbolism of the fact that speculators ought to be taxed\u2014that we stop people making a fortune from doing nothing, at the expense of the family who buys the property and who will work another 10 years to pay off their mortgage\u2014we would not support this bill. It is an acknowledgment that speculation is a problem and it is an acknowledgment that the law is not working, but it fails to solve the problem. It is political floss; it is not real political action.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022eaf79431-1033-44f1-a633-22633da52c0d\u0022 data-id=\u00223876658a4a1f4fc4be52f82873073ba0\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000422\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022eaf79431-1033-44f1-a633-22633da52c0d\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00223876658a4a1f4fc4be52f82873073ba0\u0022\u003EDAVID BENNETT (National\u2014Hamilton East):\u003C/span\u003E That was a very arrogant speech from a member who thinks that he would own a city and that it is his city, which is not the case. That member, Phil Goff, has no idea about the Taxation (Bright-line Test for Residential Land) Bill. He was not even on the Finance and Expenditure Committee. He comes into this Chamber and tries a barrage of attacks, and yells at this institution to try to explain his point of view. Well, let us look at the word that that member used continually through his speech. That was the word \u201Cspeculator\u201D. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000423\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022eaf79431-1033-44f1-a633-22633da52c0d\u0022\u003EWell, I have got news for that member: a speculator would pay tax, because under New Zealand law and the 10-year rule, anybody engaged in the business of buying and selling a property with the intention of resale would be a speculator and they would pay tax. That is a 10-year rule. Those members over on that side say: \u201CNo, no, no, no. If we had a 5-year rule instead of a 2-year rule, it would be OK.\u201D Well, what about 5 years and 1 day? That would have exactly the same problem, but that person would be caught because they are under the 10-year rule, because they are a speculator in property. Mr Goff, if you intend to stand for the mayoralty of Auckland City, please understand what property law is about. Please understand the tax law of New Zealand, and do not come to this Chamber and mislead the public of New Zealand in a way that shows and demonstrates your lack of knowledge of these issues and your inability to put them across in this Chamber.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000424\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00225c39f4ca169c418093bf90f4fd0a559e\u0022\u003EHon Clayton Cosgrove\u003C/span\u003E: Point of order.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000425\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022646e0c64a03d43c7ac6f17c4b350cd3e\u0022\u003EThe CHAIRPERSON (Lindsay Tisch)\u003C/span\u003E: No, I am going to deal with something first. The member cannot say that a member has misled the House. The member will withdraw that comment and apologise for it. You cannot say that someone has misled the House.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000426\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022eaf79431-1033-44f1-a633-22633da52c0d\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00223f42606385b242709d719fc29b5185ba\u0022\u003EDAVID BENNETT\u003C/span\u003E: I withdraw and apologise. Going back to the speech from that member, the 10-year rule applies to speculators, and they are taxable. All this legislation does is deem that within 2 years of that sale, it would be automatically considered to be taxable in that way. Just as those members over there want a 5-year automatic requirement, this is a 2-year automatic requirement. The 10-year test still applies in both cases, and I suggest that that member understands tax law before he comes to this Chamber again.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022 data-id=\u0022d3796532ad1c4577a8af8f2aa0e99cd1\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000427\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022d3796532ad1c4577a8af8f2aa0e99cd1\u0022\u003EPHIL TWYFORD (Labour\u2014Te Atat\u016B):\u003C/span\u003E Thank you.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000428\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002254ae4b81ec90483896c400090b4282ce\u0022\u003EStuart Nash\u003C/span\u003E: Stuart Nash?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000429\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00220b14df7445724259accdfb13a238d6c3\u0022\u003EPHIL TWYFORD\u003C/span\u003E: Mr Chairman did not say \u201CStuart Nash\u201D, actually. As colleagues have pointed out in the last few contributions, this bill demonstrates what has become a classic pattern with this Government. We see it particularly in relation to the housing crisis, where for several years the Government has denied, denied, denied that property speculation is even part of the problem in the Auckland housing crisis. It has denied it in this House. It has denied it in the media. What we see\u2014and it is a hallmark of this Government\u2014is that it waits and waits and waits, denies, denies, denies, and then, when the focus groups and the polling tells it that it cannot credibly maintain that position any longer, it just does the bare minimum. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000430\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003EThis bill is yet another bit of legislation that the National Government has brought to this House that does just the bare minimum. We are in this incredibly frustrating position of actually voting for it because it is, at least, an acknowledgment that speculators are part of the problem in Auckland. It is, at least, something, but it is not much. So we support it, but we want to make it absolutely clear to this Committee that it is a completely inadequate response. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000431\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003EIn the course of this debate we will go through this legislation clause by clause, with reference to some of the very trenchant criticism that credible, expert submitters made to the Finance and Expenditure Committee about just how pathetic this bill is. The first is that, and we can see this in the advice from Treasury, this bill is expected to net $5 million\u2014$5 million. There are billions of dollars of tax-free capital gain happening as we speak and every year in the Auckland property market. There are billions of dollars of tax-free capital gain going on right now in the Auckland property market, but this Government does not care about that. It does not care about the loss to the economy. It does not care about the social consequences of an entire generation of young New Zealanders locked out of the housing market. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000432\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003EThis Government does not care about that, because John Key has made a political calculation. He has been very candid about it. He has made the calculation that he has more votes to gain by pandering to property owners who are watching their net worth go up by about a thousand dollars a day, at the moment, in Auckland. He does not care about Generation Rent. He does not care about the generation that is locked out of the housing market. He does not care about all of the downstream effects on people, right through to people who are living in cars and garages because the housing crisis means that they cannot afford decent housing. The National Government does not care about that.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000433\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003ETreasury said that this bill would, at best, net about $5 million in new revenue, and it said that the small amount is primarily due to the fact that there will be a great deal of avoidance. Because under the bill\u2014it is almost like it was written to encourage avoidance\u2014all that people have to do is hold on to a property for 2 years and 1 day, because avoidance is so easy. If that avoidance was not possible, then this bill would net something like $40 million. But it will net only $5 million, according to Treasury. Because avoidance is so easy, why would you not? \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000434\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003EThere is some interesting information that the Ministry of Business, Innovation and Employment provided, based on core logic data, that shows that currently in Auckland there is a huge amount of churn going on in the real estate market, but properties that sold within the first year accounted for 8.4 percent of all sales. Within a 2-year period it is 17.4 percent\u2014only 17.4 percent of sales within that 2-year period. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000435\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003EThat is why it is going to generate only a measly $5 million, because subtract all of the people who will hold on to that property for 2 years and a day from that 17.4 percent of all sales, and you will see this will make very little difference. And that is why, when the Government announced this prior to the Budget, John Shewan, one of its most respected tax advisers, said then and there: \u201CThis will not deter speculators\u201D\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000436\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002225c543e9fe354af6a7e2f6682d3c07cc\u0022\u003EJacinda Ardern\u003C/span\u003E: \u201CProfessionally confused\u201D?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000437\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00227780f25c2506439c83a5214253a5e6f7\u0022\u003EPHIL TWYFORD\u003C/span\u003E: \u201CProfessionally confused\u201D\u2014there are a lot of great quotes that we are going to share with the House. But that is why he said it will not make a blind bit of difference to house prices, and it certainly will not deter speculators.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022 data-id=\u00227e5779378ee4463ab905db2099522a23\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000438\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022893adc11-ce4e-419c-a079-08f04b3d75f5\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00227e5779378ee4463ab905db2099522a23\u0022\u003EThe CHAIRPERSON (Lindsay Tisch)\u003C/span\u003E: I am going to call Fletcher Tabuteau.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022 data-id=\u0022f66ff90f6dc34ee1b227af299c9e9746\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000439\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022f66ff90f6dc34ee1b227af299c9e9746\u0022\u003EFLETCHER TABUTEAU (NZ First):\u003C/span\u003E Thank you, Mr Chair. You have thrown me into disarray there. I did not expect that at all. I just want to make the point, in starting my contribution to this debate this evening, that we are talking about tax policy that has been introduced with three pieces of legislation, and here we are tonight debating one part of that three-part package. So that in itself puts a huge amount of confusion around just exactly what is being debated tonight, and what will be debated in the future.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000440\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00225e6b7aaa-8157-4d5e-9940-1bdbcd61ae95\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022469e92d23ee446daadfd2caac52eeaf4\u0022\u003EAlastair Scott\u003C/span\u003E: It\u2019s the second part.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000441\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002224d9fc77c08149c8b258848f83e37842\u0022\u003EFLETCHER TABUTEAU\u003C/span\u003E: Oh, it is the second part\u2014well done to you. What that member perhaps needs to realise is that in order for this legislation to be enforceable and useful we must and we need to debate the first part or the third part, for example, so that we can have the full picture. I wanted to make that point to the Committee. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000442\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003EThis legislation, and I commend Labour\u2019s contribution tonight, is weak, it is insubstantial, and it will not achieve its stated objectives. Treasury has told us that it will not capture the speculator. It told us that 5 years ago. Treasury made a submission to the Government. It said that this type of legislation, this brightline test, will actually not capture the speculator. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000443\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003EHomeownership, without any doubt, in New Zealand is falling backwards. Less and less New Zealanders are able to afford\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000444\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002275a05f96-2474-4c90-a6ea-cf7b5798e03e\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022db1f2ff2af554586a140a3b35086b188\u0022\u003EHon Ruth Dyson\u003C/span\u003E: Fewer and fewer.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000445\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022481c8f274aaf4c35a486b38866fd2b24\u0022\u003EFLETCHER TABUTEAU\u003C/span\u003E: Fewer and fewer. Thank you for that correction; I do appreciate it. So the stated objective of this piece of legislation is to discourage speculation, and with that in mind to bring down the price of property, particularly in Auckland, so that the average first-home buyer can actually buy a home in Auckland. That is the stated objective of this piece of legislation, but it will not achieve that stated objective. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000446\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003EI will just grab a few quotes. Chartered Accountants Australia and New Zealand said quite simply that this is not sound tax policy: \u201CThe overall package of reforms lacks the coherence it requires and will not provide taxpayers with the appropriate degree of certainty.\u201D The New Zealand Law Society said that this legislation should not be enacted, as it would not meet the stated policy objectives. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000447\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003EThis is not New Zealand First simply standing up and opposing legislation for the sake of opposing it. Unlike this National Government, we listen to submissions, we listen to the experts, and we acknowledge their contributions. To add to that, they told us that this bill would not dampen speculation. Specifically, they spoke to the fact that avoidance would be the main reason for it. So a brightline test gives us that 2-year period. The reality is that speculators will simply avoid that. So 2 years, 1 day\u2014one of the issues that I will talk to, actually, later on in the evening is about that practical application of time: when does the measurement start and what is the 2-year period in actual fact? \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000448\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003EThe other educational point, for the members opposite\u2014has been spoken very specifically to\u2014is the tax take from this legislation: $5 million. That in itself just highlights how ineffective this legislation will be. I think it was Mr Twyford who outlined the total value of speculation in New Zealand, and the contrast between the take from this, to disincentivise speculation, is just glaring. This bill will not stop rampant house price speculation. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000449\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003ESo I just wanted to address Mr Bennett, who said that the intention test will still apply. He was yelling it out quite abusively while someone was contributing this evening. He said that the intention test will still apply. So there is one of the confusing facts that the member needs to be aware of. It has been stated many times that tax needs to be simple and it needs to be transparent and clear. So now we have two pieces of legislation that will run in tandem. We will have the brightline test saying 2 years will apply with all transactions, although I will come to the fact that just what comes into those transactions is a hugely debatable point. But then Mr Bennett told the Committee that the intention test will still apply. It was this Government\u2019s contention\u2014and I will point this out to Mr Bennett\u2014that the intention test is actually supposedly not working and yet he is using it as a reason to say: \u201CWell, it will still apply.\u201D \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000450\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003ESo the reality is, and one of the contributors put it quite eloquently\u2014I cannot quite reach the quote now, so it is not verbatim. They said that the only people who will be captured by this test are those who are caught by unavoidable circumstances. The reality is that if you are a speculator, if you know what you are doing, and if everything is going well, you will avoid this tax; you will simply avoid it. The point was that the speculation itself will still take effect. So the bill will not achieve what it sets out to achieve. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000451\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003EI was going to come to the point about the date of disposal. I am speaking specifically to clause 4(1), which inserts new section CB 6A, and clause 15, which speaks about the change of the definition of the date of disposal, and it now talks about the brightline date, to avoid complication. Yet I make the point again that this will simply complicate issues. Then I draw the member\u2019s attention to the fact that sales of contingent interests, off-the-plan sales, will have a completely different definition, which runs counter to the intent of the date of disposal section. Within the legislation itself the off-the-plan sales will run counter to the intent, in terms of date of disposal. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000452\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003EAnd then I want to raise the issue that Mr Cosgrove brought up before, around the definition of farmland. The reality is, as pointed out previously, that farmland in itself will have houses on it. One of the issues raised by submitters was about unused farmland. We are talking about economic units that must be making a profit\u2014that is not quite the right terminology, but they must be ongoing concerns and they must be running as a business, as it were.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000453\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003EBut when you talk about a small parcel of land, that would be exempt if it were not used in combination with other land for farming business. The definition in the bill as introduced uses the concept of an economic unit, which would have ruled out such a provision or situation. So I just put it to the Minister that in regard to the definition of \u201Cfarmland\u201D we have ongoing confusion and we will need further clarification there. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000454\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e11a5f05-1940-41b2-8f1e-911dba7a43a5\u0022\u003EI would like to comment on the contribution from Miss Genter. The reality there is that the definition of \u201Cresidential land\u201D is that the relevant land-zoning rules would apply. So initially we were talking about how residential land would be defined as including bare land that, because of its area and nature, is capable of having a dwelling erected on it. But, as was pointed out again in an earlier contribution, that definition of residential land, even within councils\u2019 land-zoning rules, is ambiguous and quite broad. Exceptions within that can be brought into play either by those wishing to avoid this or by those who are caught unintendedly because they were not sure of just what is meant in the definition. The courts are going to require a great amount of time to define and outline just what it is we are talking about here. Thanks. \u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022 data-id=\u0022b154e5b03ca14b18b1b16323e2b0e2ec\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000455\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022b154e5b03ca14b18b1b16323e2b0e2ec\u0022\u003EJACINDA ARDERN (Labour):\u003C/span\u003E I know that my other colleagues are eager to speak because there is quite a lot to be said about the Taxation (Bright-line Test for Residential Land) Bill. I concur absolutely with those of my colleagues who have spoken previously and have outlined our hope that this bill could have done more but, unfortunately, it has not. No one on this side of the Chamber is disputing the need for action when we have 50-plus percent of the Auckland population renting and the lowest homeownership rates since the 1950s. The fact that this bill has minority reports from every party in the House\u2014almost, I believe, every party on this side of the Chamber\u2014demonstrates the need for there to be great debate on this bill and to highlight the areas where it is lacking. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000456\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003EI wanted to start, though, by speaking on the regulatory impact statement and some of the alternatives that it canvasses in terms of the definitions within this bill. It talks about the problem definition. It outlines that the Government is concerned with high house prices, particularly in the Auckland area. It does highlight property speculation as one of the number of causes of the current prices, and talks about other possible causes, both supply and demand, and says that these have been separately considered\u20146 years later these are still being separately considered. But on the problem definition around trying to target speculators, if that was the major objective of this piece of legislation, then I am very confused by clause 4 in Part 1, inserting in the Income Tax Act new section CB 6A, \u201CDisposal within 2 years: bright-line test for residential land\u201D. New section CB 6A(1) states \u201CAn amount that a person derives from disposing of residential land is income of the person, if the bright-line date for the residential land is within 2 years \u2026\u201D, and then sets out criteria that sit under that. As has been raised in the House, this appears to be totally arbitrary in terms of picking the 2-year cut-off. So I wanted to have a little look in the regulatory impact statement to see the justification for the 2-year line and what the evidence was that was brought to the table in order to determine that 2 years was the place that it needed to be. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000457\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003EOn the second page of the regulatory impact statement it talks about residential property churn. It says: \u201CThere is significant churn and short term speculation in residential property, particularly in Auckland.\u201D It then goes on to state that there is particular evidence around churn \u201Cfor new titles and developments in Auckland. The evidence suggests, from 2009-13 59% of all new titles were disposed of within a year and 29% of new developments in North Auckland were traded within 3 months.\u201D That probably speaks to the nature and arrangements of some of this property development, but when you look at existing residential properties and sale of dwellings within 1 year, 2 years, and 3 years, existing properties sold within 1 year represented 8.4 percent of sales, sales within 2 years represented 17.4 percent, and sales within 3 years represented 26.1 percent. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000458\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003EPresumably, if you were genuinely trying to pick up churn amongst speculators, you would have been looking at the greatest reach. That is actually supported, again, by the regulatory impact statement, which canvasses the various options and the cut-offs between, say, 2 years versus 3 to 5 years. Option one, with the 2 years, is highlighted as the option preferred by officials. Option two looks at a longer period over 3 to 5 years. It says: \u201CThis option would create a bright-line similar to option 1, however with the period of the bright-line being longer at potentially three or five years \u2026 This option has similar impacts as option 1 but with greater effect owing to its longer period. It would\u201D\u2014and this is the important part\u2014\u201Cbest meet the objective of creating an easy to enforce rule and would have the greatest positive fiscal and administrative impact \u2026 However, this option has the greatest risk of capturing sales that were acquired without an intention of resale.\u201D Surely, though, the issue over whether or not you are capturing those that were intended for resale or not is not necessarily about an arbitrary time line but around your use of definitions. Your definitions are what determine what is in and what is out, not just the time line over a period of which someone wishes to resell. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000459\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003EI want to come back to clause 6, which then goes on to talk about some of those definition issues. It seems clear that if the primary objective as set out in the regulatory impact statement was indeed around trying to ensure that we are cracking down on speculators and where there was the greatest churn, that actually the Government would have gone for a longer period. That is the reason we are supporting Supplementary Order Paper 138 before this Committee, which seeks to extend that period, because that would have the greatest impact. But, again, issues around definition are particularly important. I think it was the member from New Zealand First, Fletcher Tabuteau, who rightly pointed out that there is a real contradiction when we are talking about trying to create certainty, because the Minister of Revenue\u2019s commentary on the bill points out in the overview that the Government announced plans to introduce a new land sale rule to supplement\u2014so not to replace, but to supplement\u2014the intention test in the current land sales rules. The intention test makes gains from the sale of land taxable when bought with an intention for the purpose of resale. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000460\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003EThis intention test is difficult to enforce due to its subjectivity. So one would assume that the bill in clause 6 should step away from any subjectivity, but in that clause it talks about the main home exclusion and the fact that any disposal within 2 years does exclude the main home. But if you are looking at how the bill then defines \u201Cmain home\u201D, the main home exemption, as talked about in the commentary of the bill, states: \u201CAs introduced, the bill would exempt a person\u2019s main home from the bright-line test. Where a person has more than one home, the main home would be the one with which they have the greatest connection.\u201D No wonder submissions from the public, including from tax specialists, called this \u201Cprofessionally confused\u201D. With clarity and without the subjectivity that was brought about by the intention test, how do you define something that you have the greatest connection with? As someone has described previously, I think, it is a bit like The Castle, where you are talking about the vibe of the thing. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000461\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002257e41e9d-285b-4fb3-847d-a63820ae7137\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022423da80b24794cc9a300e591d2289337\u0022\u003EChris Bishop\u003C/span\u003E: Oh, here we go.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000462\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002272fa8f3b23ed4f8fa66722becec4a3fe\u0022\u003EJACINDA ARDERN\u003C/span\u003E: Chris Bishop, I would be very happy for you to stand up and give us a full explanation around how you define the greatest connection with a home, and whether it is, in fact, the vibe of the thing. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000463\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003ELet me put a scenario that would be picked up by Part 1. If, for instance\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000464\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002257e41e9d-285b-4fb3-847d-a63820ae7137\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022816629ea3ddf4987ba567faec1c7e88d\u0022\u003EChris Bishop\u003C/span\u003E: It\u2019s very easy. It\u2019s based on case law. It\u2019s leading case law. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000465\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022db5ae9846c24430c96b2988518a3463c\u0022\u003EJACINDA ARDERN\u003C/span\u003E: Oh, it is based on case law. So we have to go through the courts to establish what Parliament is unable to define. That is poor lawmaking, and the member knows it. The member knows it. If accountants and lawyers are telling you that this will be tested in the court, you know you have made bad law in that sense. You know that you have. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000466\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003EI would like to put a scenario to the member. If, for instance, an individual is living in a home and goes on to purchase another home, and chooses that they are probably going to dispose of that because it has made enormous capital gain, could they technically move into that home for the last 3 months before they dispose of it and claim a connection to that property as their residential property? Could that happen? I imagine it probably could because this is an entirely, as I say, subjective test, and surely your connection is the fact that you are a resident within it, even if you are a resident within it for a 3-month period or a 1-month period, purely in order to satisfy this completely subjective test that has been set out before us. So that is something I would welcome the Minister of Revenue clarifying for me\u2014whether that scenario that I have put forward could reasonably demonstrate connection to a residential property, even if an individual had an additional property that they were then tenanting, which was their prior residential property. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000467\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003EI think that points out the problem with the definitions. As we have stated, the regulatory impact statement was saying that longer periods would pick up a greater amount of churn, so surely part of the issue is actually the definition rather than necessarily the period of cut-off. I would like some members from the other side of the Chamber to stand up and tell me how that will make a difference. I would also like to highlight that within the regulatory impact statement it is talking about the fact, under the fiscal impacts, that it would be difficult to quantify the fiscal impact of the 2-year bright-line test because of \u201Cthe number of sales that would be delayed in order to exceed the 2-year holding period.\u201D Officials are acknowledging that the system will be gamed by speculators to simply get around this flawed bill. That is a complete lost opportunity, when we have a housing crisis in Auckland.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022 data-id=\u0022b4afbdd125fc48adacbbf34e38541572\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000468\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022b4afbdd125fc48adacbbf34e38541572\u0022\u003EJULIE ANNE GENTER (Green):\u003C/span\u003E I think the heart of the issue in this debate is really about fairness. We have a problem with our existing tax law in that it is not entirely fair and it favours investment in property over other types of work and income. It is a problem that we all acknowledge and we all need to address. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000469\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EOf course, Treasury, the Reserve Bank, and many economists have been calling for action on this issue for a number of years, and, understandably, Governments have had a hard time taking the steps to close the tax loopholes on property because it is going to affect a number of people. But there has never been a more urgent time for us to come together across the Chamber to find a constructive solution to this problem. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000470\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EI note that even just this week the IMF came to New Zealand on a mission. It made some specific statements about tax measures. It stated: \u201CThe newly introduced measures to deter speculative investment are welcome, and further steps in this direction should be envisaged. In addition, a more comprehensive reform to reduce the tax advantage of housing over other forms of investments could be warranted. This could include reducing the scope for negative gearing.\u201D That is what the Green Party is saying here tonight. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000471\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EI know a number of my colleagues on this side of the Chamber agree that this legislation could be improved to deal with this problem, and I am sure there are a number of members on the Government side who agree that this legislation could be improved to have a beneficial impact on all New Zealanders in the long term. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000472\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EI have asked them to consider tonight these very, very humble Supplementary Order Papers. They are not particularly ambitious. They are pretty minor changes, but they would significantly improve the bill. We have Supplementary Order Paper 138 extending the time frame from 2 years to 5 years, as originally advised by Treasury. This is a compromise measure. I am putting this forward as a compromise. This is not the Green Party\u2019s policy. We would like to see a comprehensive capital gains tax excluding the family home, which we think would be better because it is only fair that income, whether it is earned by a job or whether it is earned from the sale of a property, should be taxed in the same way. We think that is fair. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000473\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EBut I have come tonight with a compromise measure\u2014it was Treasury\u2019s compromise when it put it forward in 2010\u2014to have the brightline test apply for a 5-year period so that it is much more effective. I know that Mr Bennett has said tonight: \u201COh well, you\u2019re still going to have the problem that speculators will hold on to 5 years and 1 day.\u201D Well, I think we can all agree that there is a big difference between holding a property for 2 years and holding it for 5 years\u2014in fact, there is a 3-year difference; it is more than twice as long. It would be substantially more effective at slowing the churn, and that is important to limit the fast pace of the growth in house prices in Auckland. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000474\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EIt is true that speculators can be land bankers and they can hold property, sometimes, for very long periods of time, but slowing the churn will slow the growth, which slows the damage that could potentially be caused when the bubble finally bursts. So it is not a dramatic move. It would just be in line with the vast majority of OECD countries that have holding periods of at least 5 years. There are very few that have less than 5 years, and they also have problems with property bubbles. So I ask the Government to consider this constructive contribution from the Greens\u2014I know that other parties will be supporting it\u2014so that we can have a better bill. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000475\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EThe other change, of course, that we are proposing tonight is that this applies to all land, not just to residential land. It will be more coherent, there will be fewer loopholes, and we will not have to deal with this extremely tricky problem of how we define residential land because, ultimately, land can be used for residential purposes. Even if it is not currently being used for residential purposes, even if it is not currently zoned for residential purposes, it can, in fact, be used for residential purposes. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000476\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003ESo to clean up this legislation there are minor improvements proposed tonight by the Green Party. I hope that the Government will consider listening to us because we do want to have the best outcome for New Zealand. If we are going to go through the steps of passing this legislation, it may as well be as good as it can be. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000477\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EEven if it is not our policy, we are willing to support this bill. We are voting for it, but we think that it could be improved. In line with many of the submitters\u2019 comments that we heard at the Finance and Expenditure Committee, our proposals are not particularly drastic, and they are not even out of line with the advice that the Government itself received from Treasury a number of years ago. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000478\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002258f935f1-6646-40ab-9d99-17029396850c\u0022\u003EI will make one final comment about this package of bills, because this is the final piece of legislation in a package. We tried to make constructive improvements to the previous law\u2014\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022859e13f9-33bb-41bb-b2f0-d848eaf25407\u0022 data-id=\u002218492a594cc540c5911c3f5b4af2a832\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000479\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022859e13f9-33bb-41bb-b2f0-d848eaf25407\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002218492a594cc540c5911c3f5b4af2a832\u0022\u003EANDREW BAYLY (National\u2014Hunua):\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=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022 data-id=\u002256415d68b3a1482cbf917132ef840831\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000480\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002256415d68b3a1482cbf917132ef840831\u0022\u003EHon DAVID CUNLIFFE (Labour\u2014New Lynn):\u003C/span\u003E We are supporting this bill, but only because it is the tiniest\u2014tiniest\u2014conceivable step in a very important direction. It is hard to imagine an issue more central to New Zealand\u2019s economic and social future than the way we are dealing with the rampant house price inflation - property crisis. Labour colleagues are going to be taking a large number of calls on this bill because it is so important to New Zealand that we expose the \u201Cwhy?\u201D, the \u201Cwhat is wrong?\u201D, the \u201Cwhat does this bill do?\u201D, the \u201Cwill it work?\u201D, the \u201Cis it sufficient?\u201D, and the \u201Cwhat else needs to be done?\u201D. We are going to dive down, at considerable length, to the clauses that are contained in the various parts of this bill. This is an introductory set of comments because we are on Part 1\u2014the first clauses\u2014in the Committee stage. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000481\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EWhy is this a crucial issue? It is simply because there is nothing much more important to New Zealanders and our Kiwi families than achieving the Kiwi dream of homeownership. People pay their mortgages for years and years and years, and that dream is slipping away. How we do know? Because homeownership rates are lower today than they have been at any time since\u2014would you believe\u2014the 1951 waterfront strike.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000482\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002275a05f96-2474-4c90-a6ea-cf7b5798e03e\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002299adb1947bd847ae9f31a9df4d79f3f1\u0022\u003EHon Ruth Dyson\u003C/span\u003E: Lockout.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000483\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022cd47ac53802547a797b259080250222c\u0022\u003EHon DAVID CUNLIFFE\u003C/span\u003E: Lockout\u2014exactly. The year 1951 was the last time New Zealanders had as little homeownership as we do today. That is a tremendously awful statistic. Why is it? In Auckland alone there has been a 27 percent increase this year in the cost of an average house in my area of Waitakere City. Why do I know? Because I am trying to buy one at the moment. There has been a 27 percent increase in 1 year. A house earned more than almost every worker in the country. Can an average Kiwi family afford an average home, on an average income, in Auckland? Are you kidding? Are we kidding? Of course an average family is locked out of the property market. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000484\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EThe second key thing is that when Kiwis do get a home of their own, under the current tax laws, which help inflate house prices, they are going to stay poor for longer. According to Shamubeel Eaqub\u2019s book Generation Rent, whereas a few years ago we were paying on average 30-year mortgages, housing is now so expensive that families are paying for 50 years to pay off a home\u201450 years. New Zealand families are poorer because our property tax system is so, so broken. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000485\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EWhy else does this matter? New Zealand as a country will stay poor until we put more capital into productive investment and less capital into bidding up each other\u2019s ridiculously overinflated housing prices. Why is the Government not doing more to solve the most important economic problem in New Zealand? I can only see, and we will work through the analysis\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000486\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003ESitting suspended from 6 p.m. to 7.30 p.m.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000487\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b62cb47e1ed54e31986fa4709353832b\u0022\u003EHon DAVID CUNLIFFE\u003C/span\u003E: Good evening to colleagues and to viewers. Before the break, we were reflecting upon the context for this actually very important and significant tax bill. This is the brightline test that says that if you sell a property that you are not living in, minus a few exceptions, within 2 years of buying it, you pay tax on it as a trader\u2014or, at least, that is the high-level plan. Before the dinner break we were noting that that is one way into a very, very important issue for New Zealand. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000488\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EThat very important issue is the twin catastrophe of the housing crisis, which is locking young families out of the Kiwi dream, and the misallocation of investment capital, which means that, basically, we are spending all our money bidding up each other\u2019s house prices, often through speculative investment, enslaving ourselves to the mortgage for longer, and not investing in the productive investments that will create jobs and incomes for the future. That is an absolutely central issue to the problems of the New Zealand economy, and unless we fix it we will, quite simply, be poorer in years to come and our children will have fewer opportunities. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000489\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003ESo now the question is whether this bill helps materially. My colleagues and I will answer that by taking quite an extensive range of calls. This is a really important and detailed bill. Let us begin by asking: \u201CWhat does the bill actually require?\u201D. Well, it has got a 2-year brightline test from the date that a person takes title. That brightline test will apply only to residential land\u2014that is, to residential real estate. It does not apply to business property, and it does not apply to farmland. That is a very, very important distinction, because residential mortgages are about 53 percent of the total bank mortgage stock, farm mortgages are a little over 20 percent, and business working capital and business mortgages are about 16 percent. So the definition excludes around about half of the mortgage stock. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000490\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EThe brightline test does not apply, of course, to a person\u2019s main home. That is important, and we agree with that. We have never thought that there should be any form of capital taxation on a person\u2019s home, because it is not just an investment. The brightline test will not apply to property acquired through an inheritance. We also concur with that. When we were working on capital taxes earlier, we did not have a disguised inheritance tax there either. Losses arising from the brightline test will be ring-fenced so that they may be used only to offset taxable gains from other land sales. That sounds good, but it is actually, as we will show later in the debate, a very broad ring-fencing provision, which reduces the coverage of the bill. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000491\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EAt a high level, what are the issues with this bill? Let us start with how much it is going to achieve. According to the Government\u2019s advisers\u2014Treasury and the Inland Revenue Department\u2014this bill, when fully implemented, will take how much tax in a year? Five million dollars. Five million dollars for a property tax across New Zealand in a whole year? Are we kidding? What is that? Two houses in Auckland? It is almost impossible to imagine how a number so small could have even been estimated or calculated. Upon what possible basis could $5 million have been the result? So that is the first clue, ladies and gentlemen, that there is something deeply wrong with the design of this tax. Five million dollars a year\u2014it is a tax you have when you have not got a tax. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000492\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EOK, so why is that? Well, the first thing is that, of course, if it is a 2-year test, speculators will hold for 2 years and 1 day and then sell on. At the moment, 17 percent of property sales occur within the first 2 years, but we would expect that to change drastically with this bill becoming law, because people who are holding for a year and a half will simply hold for 2 years and 1 day. It is highly ineffective because it is very easy to game\u2014very easy. It is a massive loophole. It just invites speculators to hold on to their properties and then flick them 2 years later. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000493\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EA tax that applies only to sales in that arbitrary period will not deter land bankers. That is really important because, as Mr Twyford has often exclaimed, for the last couple of years there has been only a handful of homes built on the Government\u2019s special housing areas. One of the reasons for that in Auckland is that people are land banking, even in special housing areas, because with Auckland\u2019s rampant price inflation, they can be pretty sure that their investment is going to be worth more a couple of years down the track. Again, this bill will do absolutely nothing to fix that. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000494\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EThe brightline test has been made even weaker by Cabinet agreeing to exempt New Zealand residents from providing their IRD number when buying or selling a house. Well, that is kind of odd, because you have to provide an IRD number if you are transacting assets in or out of a trust. You need an IRD number if you are transacting assets in or out of a company, but you do not need an IRD number here if you are a resident, which means that that applies to people who are not even citizens. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000495\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EThat is a very, very odd exception for Cabinet to have agreed to, and the Minister in the chair, the Hon Paula Bennett, who is the understudy finance Minister, will be able, I am sure, to leap to her feet with alacrity and a lot of enthusiasm and explain to us why on earth they have that mile-wide exemption. The Government ruled out a more comprehensive 3-year test or a 5-year period, despite Treasury earlier recommending it, because it could be interpreted as a capital gains tax. Well, although we do not want to use those three words in the same sentence, the whole point of this is to tax speculation, so if it does not do that effectively, then it is probably not worth having. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000496\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003ELet us ask ourselves: if, in the broad design, this tax is so flawed from the outset that it merely nods at the problem but does nothing to solve it, then why have we got it here on the House floor? As a colleague said before the dinner break\u2014I think it was Mr Twyford\u2014that is because this is National\u2019s stock and trade: the Government resists pressure for change to the point where the focus groups tell it that it is intolerable to do nothing. Faced with that pressure, it does something, usually almost nothing, and that is what we have here. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000497\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EThe only reason we are supporting this is that almost nothing is about $5 million better than absolutely nothing, which is what we had before. But almost is only almost. That is the unsolved mystery of the bill, and the Minister may be able to explain Cabinet\u2019s rationale. Why would this Government design a tax that is so useless? Who benefits? One thing you have got to say about the current Government is that you know it may be doing the wrong things but usually there is method in its madness. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000498\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003ESo who are the beneficiaries? Well, I can think of some. It certainly is not Kiwi mums and dads, because they are going to be paying more for their mortgages and slave for 50 years, not 30. It sure as heck is not Kiwi kids, because most of them will be growing up in rented homes that they can be kicked out of on a whim, on a month\u2019s notice, by their landlords\u2014and they will swap around schools, and so on and so forth, and the effects will be felt throughout their lives. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000499\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003ESo it is not Kiwi kids. Is it real estate agents? Well, yes, it probably is, because this tax does not quell the property market, so they will be riding that bubble as they always were. They certainly are not losers here. Is it the banks? Ah! Maybe here we are a little closer to the heart of the onion, because the banks are experiencing record profitability off the housing and property boom. If you think about it, if your family is taking out a mortgage for 50 years instead of 30 and you are paying interest for the extra 20, then it is the bank\u2019s profitability that will be lifted, particularly in a low interest rate environment as we have at the moment. So it is not Kiwi kids and it is not mums and dads. It is probably the banking system and, of course, it is the property speculators. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000500\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EI would invite the Minister to reassure the Committee that this bill was badly designed by accident rather than design. There is a rebuttable suggestion that this is a deliberate sham that has been designed to look like the Government is doing something when it knows full well it is not. And the reason it is not is that the powerful interests in the financial system and the property sector have made damn sure it will not, even though it knows it would be in the interests of every Kiwi family to have a more effective piece of legislation than the one we are called upon to pass into law through this bill. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000501\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003ESo Labour MPs and our colleagues on this side of the Chamber will be drilling into this piece of legislation over this evening as we go through the Committee stage. We will go through it part by part, clause by clause, comma by comma, and we will expose for New Zealand why it is not effective, why it cannot be as effective as it needs to be, and why that $5 million a year for the whole country is really just the cost of a public relations stunt. This is a public relations stunt, not real tax law. The members opposite know in their heart of hearts that this is really a tax joke. They know this is not going to make a blind damn of difference to the Auckland property bubble or anything else. All it does is let the National Government off the public relations hook in terms of a rising tide of angry parents and angry householders who are worried sick about meeting their mortgages or being tossed out of their rental accommodation. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000502\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EThis bill is a political bill. It is not a substantive tax bill, despite the fact that it has taken the time of officials, the select committee, and this House\u2014and we will do justice to that process. There is no doubting that this bill is not an effective piece of legislation. Labour is supporting it only for the reason that we wish to send a signal that the problem to which this bill supposedly addresses itself is one of the utmost importance to the New Zealand economy and our society.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022 data-id=\u002290a649aee01f4c4fb81d3b55fc0704b5\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000503\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002290a649aee01f4c4fb81d3b55fc0704b5\u0022\u003EPOTO WILLIAMS (Labour\u2014Christchurch East):\u003C/span\u003E I can assure the Committee that there is no one more surprised than myself that I am taking a call on a taxation bill, but I assure you that I will give it my best shot. There is a very good reason I want to speak on this bill, and that is that the intent of this bill is to take the heat out of the speculation in the Auckland housing market. There is nothing more difficult at this stage than people trying to buy their first home in the Auckland housing market.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000504\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022\u003EI want to acknowledge that the Finance and Expenditure Committee obviously had quite a difficult time because the process was truncated. I am sure that the people who wanted to submit on this bill could have if they had been given the right opportunity and the time to consult widely, rather than just being given 10 days to make their submissions. If that had been the case, we may have come out with a bill that really did hit the mark in terms of taking the heat out of the speculation, particularly in the Auckland housing market.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000505\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022\u003EThe bill, right in its name\u2014the Taxation (Bright-line Test for Residential Land) Bill\u2014tells us that the brightline test applies. I admit I had to go and look up what a brightline test was. As I understand it, it is a judicial rule that will help restore ambiguous issues by setting a basic standard that clarifies the ambiguity and establishes a simple response. So right there, right up front, at the very beginning, in the title of the bill, is the intent of this legislation\u2014to clarify any ambiguity and to establish a simple response.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000506\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022\u003ESo what I thought I would do is actually use this test in terms of some of the provisions of the bill. So let us start off with the definition of the \u201Cmain home\u201D. I admit I found it a little unusual to be looking at the definition of the main home when looking at the exemptions, where the property owner may own more than one property, one home. But the main home would be the one that they have the greatest connection to. I guess if you are to use the test from that famous Australian film The Castle, you are thinking about the one that gives you the vibe. It is the one that has the vibe. But when you are asking officials from the Inland Revenue Department to make a determination about what the main home should be, should you not have a stronger test than the home that gives you the greatest connection?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000507\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022\u003EThen we look to the fact that this bill covers only residential land. It does not cover farms or commercial land. It just covers residential land. But under the definition of \u201Cfarmland\u201D in this bill, it says farms but not lifestyle blocks or hobby farms. So if we were to apply the test of establishing a simple response and clarifying ambiguity, what is the difference between a farm and a hobby farm? Is it how much income the farm takes? Is it the size? There is no clarity around that, and if the Minister in the chair, Minister Bennett, is of a mind, it would be great if she could give us some clarity on that.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000508\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022\u003ENext I want to have a look at the date of disposal. In terms of applying the brightline test to that, within the definitions, the commentary on the bill states: \u201CWe recommend using the term \u2018bright-line date\u2019 instead of \u2018date of disposal\u2019 \u201D. I am unsure what the difference between those two dates is, and again I seek clarification from the Minister. It would be very good to know what that is.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000509\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022\u003EMy colleagues have already talked about the intent of this bill being to curb speculation by requiring any properties that are held for 2 years or more to, when they are sold, be subject to tax in that period of time. But we have also heard that about 17 percent or 18 percent of properties come up for resale within that 2 years\u2014actually within 17 or 18 months; that is what has been told to the select committee. But Treasury has recommended 5 years. We can be fairly sure that anyone who is interested in purchasing property for the sole purpose of making money from it will just hang on to that property for 2 years and 1 day before they sell it.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000510\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022\u003EBut there is a real danger that some people will be caught unintentionally within that 2-year period, and they will be, for example, those for whom there might be a matrimonial property issue, or people who may have had some financial concern that would require them to sell off the additional property. When we look at how much this tax\u2014and it is a tax; let us be clear about that\u2014is likely to achieve each year, we are looking at $5 million. I would suggest that the $5 million is actually going to come from this cohort of people, who are not in a position to purchase homes for speculative gain. The people whom are not intended to be caught by this are those who have matrimonial property disputes. I suggest that that is where the bulk of this $5 million will come from.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000511\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022\u003EIf we are actually looking to take the heat out of the market, we would be looking to the longer period that Treasury has recommended, which is the 5-year period. As a previous speaker has already said, about 8 percent of homes are sold within the first year, and 17 percent or 18 percent are sold within 2 years, and, then, for homes resold within 3 years we are looking at about 26 percent. So if we are really looking at being intentional with regard to ensuring that we take the heat out of the Auckland housing market, this Government should actually do the right thing, which is to take Treasury\u2019s recommendation and move the period from the 2 years currently to 5 years. There are other issues, I am sure, that will come up during the course of this debate, but, at this point, I thank you very much for the call.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022163d0b68-eb0e-4094-9bed-99e184f063e1\u0022 data-id=\u0022fcc916aaa26149edbc643673719f104e\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000512\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022163d0b68-eb0e-4094-9bed-99e184f063e1\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022fcc916aaa26149edbc643673719f104e\u0022\u003EJAMI-LEE ROSS (Junior Whip\u2014National):\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=\u00222aa0b524-c38d-45aa-bd5b-99c5927085f4\u0022 data-id=\u002254a9dad0ae2b476692430f93158dd341\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000513\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00222aa0b524-c38d-45aa-bd5b-99c5927085f4\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002254a9dad0ae2b476692430f93158dd341\u0022\u003ECLARE CURRAN (Labour\u2014Dunedin South):\u003C/span\u003E The definition of the brightline rule, or the brightline test, describes it as being composed of \u201Cobjective factors\u201D, which leaves little or no room for varying interpretation, and the purpose is \u201Cto produce predictable and consistent results\u201D in its application. I think that you could describe this piece of legislation as being the very opposite of that test. So it is not a bright line; it is a very muddy, clouded line that is being produced by this Government as its way of doing something about the rampant speculation in the Auckland housing market and the impact that that is having on our country and our country\u2019s economy and the ability for New Zealanders to afford to buy a home, to afford to rent a home, and to be able to get ahead in this life. What this Government is doing with this legislation is just turning it into a political stunt\u2014an absolute political stunt\u2014that will require this House, within the next couple of years, no doubt, to be looking at this again because it is so token and so inadequate. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000514\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00222aa0b524-c38d-45aa-bd5b-99c5927085f4\u0022\u003EWith particular regard to Part 1 of this legislation, there is the test at clause 15, the test that goes to residential land only; clauses 6 and 15, which exclude the sale of a person\u2019s main home from the test; clauses 4 and 11, which exclude inherited property from the test; clause 10, which excludes the transfer of property as the result of a relationship breakdown; and so on, and so on\u2014the point being that the test of a brightline is there for consistency and for there to be no or very, very little room for inconsistency in that objective test. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000515\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00222aa0b524-c38d-45aa-bd5b-99c5927085f4\u0022\u003EDespite the fact that there was a very truncated period for the Finance and Expenditure Committee for the hearings and submissions on this bill, there were some very good submissions on this bill. Almost all of them questioned the objectivity, the objective test, and the consistency of the brightline test, which is why we are going to see this legislation back in the House again. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000516\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00222aa0b524-c38d-45aa-bd5b-99c5927085f4\u0022\u003EI want to refer briefly to an article by Terry Baucher\u2014which, no doubt, other colleagues have mentioned\u2014who is an Auckland-based tax specialist. He makes the very good point that good tax policy takes steps to remove inconsistency and improve coherence. Well, this legislation is not doing that. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000517\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00222aa0b524-c38d-45aa-bd5b-99c5927085f4\u0022\u003EMy concern particularly\u2014because I know that colleagues are speaking about other aspects of this bill\u2014is about the number of people who will get caught up in this legislation who should not be caught up in this legislation, and about where the grey and muddy, clouded areas will affect them. My concern is about the people who make the decision to sell the home that they have bought within that 2-year period because of personal circumstances and who have no idea of the impact that this legislation will have on them. This legislation has no regard for them or for the impact that it will have on them. Whether they are people who have somebody die in their family, who have a divorce in their family, or for whatever reason, there are unintended consequences from this piece of legislation. That is one of the reasons\u2014\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022163d0b68-eb0e-4094-9bed-99e184f063e1\u0022 data-id=\u0022d1af1aa13ba04bf5a1c8b0b84bc9f568\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000518\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022163d0b68-eb0e-4094-9bed-99e184f063e1\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022d1af1aa13ba04bf5a1c8b0b84bc9f568\u0022\u003EJAMI-LEE ROSS (Junior Whip\u2014National):\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=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022 data-id=\u0022da49a91207024b23a49c46f9a9bb7793\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000519\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022da49a91207024b23a49c46f9a9bb7793\u0022\u003EPHIL TWYFORD (Labour\u2014Te Atat\u016B):\u003C/span\u003E Because of the rushed and truncated time frame for this bill and the fact that it is going to be retrospective, we are in the unusual situation of being here at the Committee stage of the bill with the bill, basically, having been in operation for the past month.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000520\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003EWhen Quotable Value released its October data last week, it was quite extraordinary because it, basically, gave us a snapshot of whether or not the bill has had any effect. Of course, the effectiveness of the bill is one of the things that we are debating here and is one of the things that almost all of the submitters at the Finance and Expenditure Committee put a big question mark on over the bill. What we saw when the numbers came out last week was that prices in Auckland rose by $21,500 in the month of October and hit a new high of $918,000 for the average price. So you have to wonder whether or not this bill, in all its glory, is being very effective at all, based on its first month in operation.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000521\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003EI think one of the most interesting quotes from the submitters was from the senior tax specialist who came along to the select committee and said that he was professionally confused by the provisions in this bill. A number of others said that the brightline test was a bad idea, incoherent, and ineffective. I think people will be getting a little bit of the drift of the response of submitters at the select committee.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000522\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003EThe provision that demonstrates, perhaps, the level of confusion underlying this bill is, I think, around the so-called \u201Cmain home\u201D. I am talking about clauses 6 and 15(5), (10), and (11). The main home provisions in this bill have carried over from the non-resident foreign buyers\u2019 legislation that was passed recently. This is a very confusing situation around the main home. The bill, basically, requires that the land in question be used predominantly as the person\u2019s main home and that it be used as their main home most of the time. In the situation where there is more than one home that could be subject to income tax because it has been sold within the 2-year period, that is where we really start to get into the good stuff in this bill.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000523\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003EThe bill applies what it calls the \u201Cgreatest connection - test\u201D to determine which of these two properties is the person\u2019s main home. The greatest connection - test determines, on an objective basis\u2014which is a bit of an oxymoron in this case\u2014which property is the main home, and it applies the following criteria: the time the person occupies the dwelling; where their immediate family, if any, lives; the person\u2019s use of the dwelling; the person\u2019s employment, business interests, and economic ties to the area where the dwelling is located; whether the person\u2019s personal property is in the dwelling; and then the coup de gr\u00E2ce is where their social ties are strongest.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000524\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003ECan you imagine how much work this is going to generate for tax lawyers in the leafy suburbs of Auckland, as they attempt to make sense of these overlapping and vague definitions about which of two homes may have the greatest connection and, therefore, which one the person would be able to apply the exception to?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000525\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003EIt is completely confused. It does not actually use the existing established definitions in other comparable legislation\u2014that would have been much simpler. In this case, the Government has chosen to apply the vaguest and broadest definitions, provide a little guidance on the side, and hope that somehow that will deal with the sheer complexity and variety of situations that this law will have to be applied to. The whole issue around \u201Cmain home\u201D is in fact Mabo\u2014it is the vibe. This bill is a tribute to The Castle. As previous speakers have said, we will be back here fixing this up. It was a rushed, chaotic, and hurried political response to the problem of speculation in Auckland.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00225f1453f8-c44e-4ce6-b699-64d600322276\u0022 data-id=\u00229e628e41465f4a0498294ee4d3ac3b7f\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000526\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00225f1453f8-c44e-4ce6-b699-64d600322276\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00229e628e41465f4a0498294ee4d3ac3b7f\u0022\u003EThe CHAIRPERSON (Hon Chester Borrows)\u003C/span\u003E: I will just give the Committee a bit of an indication. We are even starting to hear the jokes being repeated now. The fact is that there have been 18 calls from the Labour Opposition, there have been another 5 calls from the other Opposition parties, and 3 closure motions from the Government. Actually, if the new material is not novel in any way, it will not be lasting long. I have given some latitude, bearing in mind that the guts of the bill is in the first part, and I am not expecting the second part\u2019s questions to be lasting as long, by any means. I call the Hon Clayton Cosgrove for his third call on this bill.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022 data-id=\u002219f6739f48064c799c49c32f99e80a52\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000527\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002219f6739f48064c799c49c32f99e80a52\u0022\u003EHon CLAYTON COSGROVE (Labour):\u003C/span\u003E I give you an absolute commitment that I will not crack any jokes. I do note in passing Assistant Speaker Mallard\u2019s ruling last week when he allowed, as you have, Mr Chairman, very generously, quite a bit of latitude where questions were posed on a piece of legislation and Ministers failed to answer any of those questions. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000528\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EBut moving on, I want to deal with a critical part of the proposal, and this is in regard to the 2-year period when it starts and finishes. The Taxation (Bright-line Test for Residential Land) Bill proposes that the 2-year period should start on the date of registration of title, rather than the date of entry into the sale and purchase agreement. On the face of it, you may argue that that is a logical way to go, until you actually look at what submitters were particularly critical of. They were critical of this part of the bill because it differs in the general definition used for purposes of the land provisions in the Income Tax Act. I suppose in plain English that means, again because of the rushed and hashed nature of this legislation, that definitions that have no case law attached to them and that are not consistent with the Income Tax Act have been put in here. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000529\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EI will give another example. In its submission to the Finance and Expenditure Committee, on the issue of coherence with current land rules, Chartered Accountants Australia and New Zealand submitted that \u201CThe concepts underlying the bright-line test and other reforms and the definitions relied on should be consistent with those in current land rules.\u201D. So, essentially, in plain English again, it is saying that the definitions you put in this piece of legislation should be consistent, if you like, with the Income Tax Act\u2014I would have thought that the Inland Revenue Department would have said \u201CYes, that makes sense\u201D, because we have an abundance of case law in respect of a whole host of definitions\u2014and in respect of the Land Act, because again we have a whole host of case laws around the definitions. But hey presto, in a sort of David Bennett turbo-boosted special we ram this thing through, and there is a total inconsistency in definitions. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000530\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EI would have thought that when you have Chartered Accountants Australia and New Zealand ringing alarm bells around this, the Government would have looked at it and said: \u201CHang on, we\u2019ve got to get this right.\u201D I do not blame the Inland Revenue Department officials, because they are under instructions from Ministers, but you have got to say that this legislation breaks new ground in the level of critique from the private sector taxation profession, right through from\u2014as my colleague talked about\u2014the definition of \u201Cmain home\u201D to the exemptions around farmland and to a whole host of aspects that colleagues have debated here tonight. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000531\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EAs I said in my first contribution, tax law at its essence has to be simple for people to understand, it has to be transparent, and very rarely should it ever be retrospective. But we have a whole series of definitions and new terms here that have essentially been invented. The difficulty is going to be, as the Chartered Accountants Australia and New Zealand pointed out, that this whole piece of legislation lacks coherence and lacks any sort of case law around it. There is an invention of new law. In the old days this sort of stuff would have never got from the Inland Revenue Department to the Minister\u2019s desk. No disrespect to the officials; it would have never landed on the Minister\u2019s desk, and if it did, certain officials\u2014learned officials, who had 30 or 40 years\u2019 experience\u2014would have kicked this for touch and would have said: \u201CMinister, there is no way on this God\u2019s earth that this legislation is actually going to work; it\u2019s out.\u201D We have had a litany from revenue Ministers, whether it be the car-park tax that got booted or the tax on computers that got booted\u2014it was a laughing stock\u2014and now we have this. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000532\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EAlthough on this side of the Committee we say that we commend any measure, minimal though it may be, to crack down on property speculation and give folks, not only in Auckland but right around the country, the ability to get into their first home and have a fair go, you have got to say\u2014and it is not just politicians saying it. Discount everything we say on the Opposition; just discount it and throw it out in the bin if you want, but you have got the profession speaking, from the New Zealand Law Society to Chartered Accountants Australia and New Zealand to Ernst and Young, and on and on it goes. These folks generally, I think, are not political. They are pretty honourable people, they are very learned in their profession, and they have said through nearly every aspect of this bill\u2014the definitions of \u201Cmain home\u201D, the farmland, and the definitions that I have called out\u2014that it simply will not work.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022a434482b-7ac1-4862-9ce7-13e63289dee3\u0022 data-id=\u002264150d3411854cd6abfd26c35a653916\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000533\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022a434482b-7ac1-4862-9ce7-13e63289dee3\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002264150d3411854cd6abfd26c35a653916\u0022\u003EADRIAN RURAWHE (Labour\u2014Te Tai Hau\u0101uru):\u003C/span\u003E T\u0113n\u0101 koe, Mr Chairman. Tihei mauri ora! At the end of my speech, I want to speak a little bit on mauri, and the determination and the notion of mauri when it comes to determining the main home. But first of all, I want to talk about the speculators.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000534\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022a434482b-7ac1-4862-9ce7-13e63289dee3\u0022\u003EI do not believe that there is a test within this bill that adequately identifies and determines what a speculator is. Surely it cannot just be based upon the length of time that one owns a property, and then suddenly after 2 years and 1 day you are no longer a speculator\u2014well, I would beg to differ on that. I believe that we need a test in here that determines what a speculator is on the day that they purchase that particular property. I would further suggest that the test ought to be: is there intent to sell that home; and are they a New Zealand citizen based in New Zealand, or are they offshore and purely in this to make money? That should surely be the test\u2014not the length of time. I suggest that that ought to be the test.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000535\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022a434482b-7ac1-4862-9ce7-13e63289dee3\u0022\u003EI also wanted to bring up the matter of the submission from the New Plymouth District Council, which the Finance and Expenditure Committee has, I believe, adequately addressed in determining that the leasehold homes in Waitara on the Pekapeka Block will, in fact, be exempt should the occupants\u2014the leaseholders\u2014purchase those properties. I believe that is the right thing to do. But I bring that up because, at another level, it also highlights the truncated process that the select committee was forced to go through for this retrospective legislation. I wonder how many other potential homeowners or leaseholders out there are not covered by this legislation, and so I ask the Minister in the chair, the Hon Paula Bennett, whether she can give us some assurance on this very issue.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000536\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022a434482b-7ac1-4862-9ce7-13e63289dee3\u0022\u003EWe have heard from my colleagues on the issue around what the main home is. I have to say that, from my perspective\u2014I have many whare, like a lot of M\u0101ori. I have to say that I find this argument quite silly\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000537\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00222aa0b524-c38d-45aa-bd5b-99c5927085f4\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00229225474cdda14aea87398384081a4b40\u0022\u003EClare Curran\u003C/span\u003E: It\u2019s ridiculous.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000538\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022a434482b-7ac1-4862-9ce7-13e63289dee3\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ffbd961dd7c241989205566a791f9670\u0022\u003EADRIAN RURAWHE\u003C/span\u003E: \u2014and, as my colleague Clare Curran has said, ridiculous. And I will tell you why. The reason, as I see it, and looking at it through M\u0101ori lenses\u2014you would surely see that one whare being more important than the other\u2014well, we do not look at the world like that. And so if we are using\u2014some of my colleagues have referred to the word \u201Cvibe\u201D. Well, we would call it mauri, and the mauri of how you feel about your mother\u2019s marae and your father\u2019s marae can equally be placed in terms of homes. How do you quantify that? I would love to hear from the Minister on these issues. How would you determine that one is greater than the other? As my colleague David Cunliffe has already said, I think we will see this piece of legislation back before the House before 2 years is up. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000539\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022a434482b-7ac1-4862-9ce7-13e63289dee3\u0022\u003EThat is my contribution to this first part. I hope to take another call in the second part, but, for now, thank you very much. Tihei mauri ora.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022163d0b68-eb0e-4094-9bed-99e184f063e1\u0022 data-id=\u0022b1d93ff7044c457e8258303662cdd09f\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000540\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022163d0b68-eb0e-4094-9bed-99e184f063e1\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022b1d93ff7044c457e8258303662cdd09f\u0022\u003EJAMI-LEE ROSS (Junior Whip\u2014National):\u003C/span\u003E I move, That the question be now put.\u003C/span\u003E\u003C/p\u003E\u003Ca id=\u0022783bd391740b45ac91ac638a3b58fc0e\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 question be now put.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EAyes 63\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand National 59; M\u0101ori Party 2; ACT New Zealand 1; United Future 1.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENoes 58\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand Labour 32; Green Party 14; New Zealand First 12.\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      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000541\u0022\u003EThe question was put that the amendments set out on Supplementary Order Paper 138 in the name of Julie Anne Genter to Part 1 be agreed to.\u003C/p\u003E\u003Ca id=\u0022963efe60b1804ebcb2b28fb4fd05bd7a\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 amendments be agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EAyes 58\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand Labour 32; Green Party 14; New Zealand First 12.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENoes 63\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand National 59; M\u0101ori Party 2; ACT New Zealand 1; United Future 1.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EAmendments not agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000542\u0022\u003EThe question was put that the amendments set out on Supplementary Order Paper 139 in the name of Julie Anne Genter to Part 1 be agreed to.\u003C/p\u003E\u003Ca id=\u002242e554cb497c4938ba07d78c2a28a852\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 amendments be agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EAyes 26\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EGreen Party 14; New Zealand First 12.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENoes 95\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand National 59; New Zealand Labour 32; M\u0101ori Party 2; ACT New Zealand 1; United Future 1.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EAmendments not agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000543\u0022\u003EA party vote was called for on the question that Part 1 be agreed to.\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002275a05f96-2474-4c90-a6ea-cf7b5798e03e\u0022 data-id=\u0022f5fc087853cb43bc9ed1768eb3c2376f\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000544\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002275a05f96-2474-4c90-a6ea-cf7b5798e03e\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022f5fc087853cb43bc9ed1768eb3c2376f\u0022\u003EHon RUTH DYSON (Labour\u2014Port Hills):\u003C/span\u003E I raise a point of order, Mr Chairperson. I seek leave to correct my incorrect vote that I just made.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00225f1453f8-c44e-4ce6-b699-64d600322276\u0022 data-id=\u002226e43294b4304ff4b72490a854fe2d86\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000545\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00225f1453f8-c44e-4ce6-b699-64d600322276\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002226e43294b4304ff4b72490a854fe2d86\u0022\u003EThe CHAIRPERSON (Hon Chester Borrows)\u003C/span\u003E: Leave is sought for that purpose. Is there any objection? There appears to be none.\u003C/span\u003E\u003C/p\u003E\u003Ca id=\u00227f76dfaa067245c6a95584926387be89\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 1 be agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EAyes 77\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand National 59; Green Party 14; M\u0101ori Party 2; ACT New Zealand 1; United Future 1.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENoes 44\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand Labour 32; New Zealand First 12.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EPart 1 agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000546\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u00222fcf6301fbb8436a8e76e0f4f9d0aaaa\u0022\u003EPart 2  Amendments to Tax Administration Act 1994\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00225f1453f8-c44e-4ce6-b699-64d600322276\u0022 data-id=\u002288fe242c25b8479f9d552a8684c5ddaa\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000547\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00225f1453f8-c44e-4ce6-b699-64d600322276\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002288fe242c25b8479f9d552a8684c5ddaa\u0022\u003EThe CHAIRPERSON (Hon Chester Borrows)\u003C/span\u003E: Members, we come now to Part 2. As I indicated earlier, this debate is very narrow. It involves clause 16A and clause 16. Members will speak tightly to the matter before the Committee\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000548\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022c5fd7b0ac9c04b98a5f0447e5e103903\u0022\u003EHon David Cunliffe\u003C/span\u003E: I raise a point of order, Mr Chairperson. As you rightly acknowledged in Part 1, Part 1 did contain the majority of operative clauses in the bill. The Labour Opposition signalled early in the debate on Part 1 that we would be commencing with a number of general contributions and then working through the clauses of that bill in a clause by clause manner. Unfortunately, you took a closure motion before it was possible for us to do that. Of course, it is going to be difficult to generalise beyond the tight provisions relating to trusts in Part 2, and we will not do so, but as we approach clauses 1 and 2, I would ask for your consideration in respect of the scope and duration of that part of the debate, because it may be necessary to sweep up some of the technical points that would otherwise have been made in Part 1. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000549\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00225f1453f8-c44e-4ce6-b699-64d600322276\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002216970037db404f2dbf0791f45df6a728\u0022\u003EThe CHAIRPERSON (Hon Chester Borrows)\u003C/span\u003E: I thank the member for his point of order. I acknowledge that clauses 1 and 2 are generally wide ranging. I do not necessarily accept that there has not been time to fully debate Part 1. I note that the Labour Party has had 16 calls. The member himself has had 15 minutes on this particular piece, and at 100 words a minute, that is pretty broad-brush. Other Opposition parties took five calls. So there has been substantial debate around Part 1. However, I am glad the member accepts that this next part will be narrow, and he can let rip on clauses 1 and 2.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022 data-id=\u00227e29448251a942129b7ec6a444fbe254\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000550\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00227e29448251a942129b7ec6a444fbe254\u0022\u003ESTUART NASH (Labour\u2014Napier):\u003C/span\u003E I am going to speak on Part 2 of this bill. This is about non-active trusts. We need to be very careful when we are looking at this, because trusts have been used and abused to hide income from property investments for far too long. Whenever I see in legislation, as I see in new section 43B in clause 16, where it says \u201CNon-active trusts may be excused from filing returns\u201D, I do not think there should be a point in time when anyone is excused from filing a return, even if that return has a nil return in it\u2014nil income or costs, etc., etc.\u2014because the law around trusts has been tightened up a lot recently, and the reason for that is provisions around gift duty and the recognition that trusts have been abused. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000551\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003ELet me give you one example. I think it was in 2009 when the Inland Revenue Department determined that about 10,000 New Zealand families were claiming Working for Families because the income derived from a trust was not counted as income for purposes of Working for Families calculations. We did tidy that up and, in fact, those 10,000 people who were deliberately rorting the law were brought back into the tax system. Whenever I see something around trusts that says \u201Cmay be excused from filing returns\u201D, I do not think that is appropriate, even though we are supporting this bill. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000552\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EThe bill does list what a non-active trust is, but by the definition it provides here, I do not think that is enough to actually say you are not required to file a return. The last thing we want to do, in my view, is lose sight of actually how many trusts are holding properties or are holding assets or are, in fact, being used to hide various forms of income in any way, shape, or form. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000553\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003ELet me give you an example here. New section 43B says that \u201C(1) A trustee of a trust is not required to furnish a return of income for the trust \u2026 if\u2014(a) throughout that tax year, the trust is\u2014(i) a non-active trust; and \u2026 (b) a trustee of the trust has made and furnished to the Commissioner, in a form approved by the Commissioner,\u2014(i) a declaration that the trust is \u2026 non-active \u2026\u201D. But we need to understand what a non-active trust is, and that, it says in subsection (2), is one that \u201C(a) has not derived or been deemed to have derived any income; and (b) has no deductions;\u201D. That does not mean that the trust is inactive. All it means is that it has not derived income. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000554\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EWe all know that among trustees or those that have trusts there is a lot of activity that goes on around this without necessarily deriving income, and I do not think that that means that we should not be filing returns because, as mentioned, the risk around this, as I see it, is that the Inland Revenue Department loses track of how many trusts are actually out there, the assets that are held in trust, and what the trustees are actually doing. A simple filing saying there is no activity means that at least there is some compliance that has to be undertaken. So I just think that this stuff should be tightened up; that is all I am going to say on this.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022 data-id=\u002290b77321915f435ca6c8724e7b199d47\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000555\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002290b77321915f435ca6c8724e7b199d47\u0022\u003EHon DAVID CUNLIFFE (Labour\u2014New Lynn):\u003C/span\u003E Mr Chairman, thank you for the opportunity, and I thank my colleague Stuart Nash for his insights there. I wish to dig down into the drafting of new section 43B(1) in clause 16: \u201CA trustee of a trust is not required to furnish a return of income for the trust for a tax year if\u2014(a) throughout that tax year, the trust is\u2014(i) a non-active trust; and (ii) a complying trust \u2026 and (b) a trustee of the trust has made and furnished to the Commissioner, in a form approved by the Commissioner,\u2014(i) a declaration that the trust is a non-active trust, and that it will notify the Commissioner if it stops being a non-active trust; and (ii) a statement of such other matters \u2026\u201D that the commissioner may from time to time require. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000556\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EThe issues here are quite interesting. The fact that the trustees need to seek permission in advance from the commissioner rather diminishes the purported saving in overhead that the supposed simplification was seeking to achieve. In other words, it is no less work for the accountant to write to the commissioner with a declaration that the trust is a non-active, complying trust than it is to write and say that it is a nil return, so I guess we question whether the construction of section 43B(1) assists in achieving the stated aim of the section, which is to reduce a compliance burden. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000557\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EIn subsection (2) the plot, as they say, thickens, because there are a number of criteria that need to be met, apparently simultaneously, for a trust to be deemed to be a non-active trust in section 43B(2). It says \u201CFor the purposes of this section, a trust is a non-active trust for a tax year if, throughout that tax year,\u201D\u2014so that is the first point; it must be true throughout the whole of the tax year, and any exception to that must be notified, again implying probably more compliance than would have been required if it had simply filed a nil return\u2014\u201Cthe trustee of the trust\u2014(a) has not derived or been deemed to have derived any income;\u201D. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000558\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003ESo there are two parts to that subsection (2)(a): \u201Cderived\u201D and \u201Cdeemed to have derived\u201D. \u201CDerived\u201D means the trust has produced income and the trustee has self-declared it. \u201CDeemed\u201D means that that has been inferred. I would imagine\u2014and I ask the Minister in the chair, the Hon Paula Bennett, to clarify if I am wrong\u2014some other party has inferred or deemed the trustee to have had income. So there is a grey area there about what the deeming process is, who is able to deem, whether they can deem for themselves, whether any third parties can deem them\u2014I think that is probably something akin to deeming with faint praise. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000559\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EThe definition of income is not specified in the subsection, which is, you know, the first thing one would think would need to be done. Presumably income is defined elsewhere in the Tax Administration Act, but there is a very special importance of the word \u201Cincome\u201D here, because the whole brightline test turns on the benefit of capital gain being defined as income if that accrues to a property that is not a farm and not a business, that has been sold within 2 years, and that is not lived in by the owner\u2014or, in the event that the owner has more than one property, their wairua, or their vibe, or their feeling is that it is not the one to which they are the most attached. You can see the hornets\u2019 nest of subjectivity that is opened up through that word \u201Cincome\u201D, especially in subsection (2)(a), if the deeming provisions allow that subjective interpretation to be inferred by a third party. So I think that third party issue is something the Minister really needs to address. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000560\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EIn subsection (2)(b)\u2014this is an \u201Cand\u201D provision\u2014it must also have no deductions. In the first pass, again, deductions are not defined in this clause; the clause is reliant upon the general definition and case law of the word \u201Cdeduction\u201D, but it does impinge on the definition of costs, because any costs of sale or costs of the land that is being disposed of and thus taxed could be construed as a deduction. The tax test elsewhere is a net test in the sense that the costs, for example, of real estate fees, of interest, of any other activity\u2014you know, painting the house before it is sold, rehousing the family pets, you name it\u2014are all costs against the sale, and they can be deducted from the sale price in order to reach the net taxable amount. Yet here in subsection (2)(b) there is a \u201Chas no deductions\u201D clause, and I think that is confusing. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000561\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EThe fact that something is a trust rather than a natural person or a different form of legal entity should not, obviously, determine the definition of deduction, so it would be very helpful for the Minister to take a call and specify to the Committee whether the definition of deduction here is the same as the definition in those other parts. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000562\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EIn subsection (2)(c), a non-active trust \u201Chas not disposed of or been deemed to\u201D\u2014there is that word \u201Cdeemed\u201D again\u2014\u201Chave disposed of any assets of the trust;\u201D. So we are talking trust assets here, and the law here is requiring the trustees to certify that there have been no disposals. That should be self-evident; again, there is case law around the definition of disposal. In subsection (2)(d) the trust \u201Chas not been a party to or perpetuated\u201D\u2014there is a lovely word\u2014\u201Cor continued with any transactions with assets of the trust which, during the tax year, (i) give rise to income in any person\u2019s hands; or (ii) give rise to fringe benefits to any employee or to any former employee.\u201D \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000563\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EI am just literally giving a plain English reading of the subsections of the section inserted by that operative clause, clause 16, the most important operative clause in this part, partly because it is almost the only clause in this part. What is clear already from this cursory romp through the jurisprudence of this one clause is that it would have been a bally sight easier for the poor old trustee to do an email to the commissioner saying \u201Cnil income\u201D than to wade through this veritable thicket of definitional quagmire, to mix a metaphor. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000564\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EThis ain\u2019t simple. There are any number of deemings that could trip a trustee, and often trustees are working pro bono, especially in family trusts. I know that there has been a great stack-up of liabilities for trustees of late in trust law, and that is discouraging people from taking on trustee roles, particularly family trustees. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000565\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003ELet us turn now to subsection (3)\u2014so we are talking new section 43B(3). In determining whether a trust complies with the requirements of subsection (2), the one we have previously exegeted, we turn to paragraph (a), which says \u201Creasonable fees paid to professional trustees to administer the trust;\u201D, which goes to the point I have just made. Sometimes trustees are, in fact, pro bono friends and family who administer a family trust for others. Paragraph (b) says \u201Cbank charges or other minimal administration costs totalling not more than $50 in the tax year;\u201D. When are we going to get over the habit of writing numbers like $50 in legislation? Ten years from now $50 will be worth only $40 or at the rate of inflation with the current Government, probably $35. Is the Government going to put this bill through the House to adjust for inflation? \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000566\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EWhy on earth has it put a manual amount as trivial as $50 in the legislation? Surely that is further evidence that this has been rushed through the Finance and Expenditure Committee in an inappropriate manner, and that kink was not ironed out at source. It does go to the point that this whole bill is a sham. As we said in the debate on Part 1, if you were really wanting to do something about the Auckland property bubble you would not do a 2-year brightline test that people can avoid by doing it in 2 years and 1 day, with more exceptions than I have had hot dinners. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000567\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003ESubclause (3)(c) states: \u201Cinterest earned on trust assets in any bank account during the tax year, to the extent to which the total interest does not exceed the total of any charges or costs incurred by the trust to which paragraph (b) applies.\u201D I do not know about you, Mr Chairperson, but I have got a headache reading through this subclause, putting myself in the shoes of \u201CJoe Average\u201D who takes on the role for a friend of being a trustee of their family trust because they are given the ability to state that they have no income, and so they should not have to file a tax return. But the mere process of making that statement is so much more complex than filing the tax return as a nil return would have been in the first place, so why are we here? Why are we here, making complexity, when there was no need for any? The answer is that the bill is a shambles.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022 data-id=\u002237d57f1c56504d97bd31c1bdd8410677\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000568\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002237d57f1c56504d97bd31c1bdd8410677\u0022\u003EHon CLAYTON COSGROVE (Labour):\u003C/span\u003E I just want to raise a couple of very quick questions. They may seem simple on the face of it, in regard to clause 16 inserting new section 43B et al, but could the Minister in the chair, or officials, advise us as to whether any of these provisions, in terms of non-active trusts being excused from filing returns, differ from the status quo? Because as I understand it, a non-active trust\u2014that is, a trust that is not making income\u2014would simply advise the Inland Revenue Department commissioner in writing that, for instance, it owned a property that perhaps the beneficiary or settlor lived in, and that there was no rent being charged, there was no money changing hands. It just simply owned an asset on behalf of the beneficiary. Therefore, there was no income being made, nothing being charged, no expenses\u2014zero. It was non-active by definition, and it would advise the Inland Revenue Department in writing, and that would be it. It would not have to file a return until it did become active. If I am wrong, please feel free to correct me, but that is my limited understanding. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000569\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EMy question simply is: are there any deviations from either my interpretation of what the status quo is, or, if the status quo is different, is there any difference from that? Because, as we have pointed out, without labouring the point, in Part 1 there are substantial differences in definitions that do not exist or are not consistent or coherent with other tax Acts\u2014the Income Tax Act and the Land Act. My question simply is: do these differ from the status quo? Because on the face of it\u2014and my colleagues have raised some valid points\u2014there is an advantage, as we have tried to communicate, in some sort of consistency between the Income Tax Act and this piece of legislation. It would give some comfort if the Minister could advise whether the same scheme of arrangement that has existed outside this piece of legislation in terms of non-active trusts exists within it. If it does, I suppose that at least it is consistent with the case law and it is consistent with other pieces of legislation. I mean that in good faith. I think it would be helpful to get it on the record of the House. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000570\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003ELikewise, in respect of the other matters here in terms of deductions and other bits and pieces, are they consistent with existing law, other than, obviously, dollar amounts? My colleague David Cunliffe raises an interesting point about the 50 bucks. I note that in the report to the Finance and Expenditure Committee from submitters\u2014KPMG submitted on the net filing income threshold for individuals and said that the $200 non-filing income threshold for individuals had been unchanged for over 15 years. It made the same point, I think, as my colleague did. Therefore, it is timely, it said, that the threshold increased to take inflation into account. It proposed a net income threshold of $500. Again, in respect of trusts, is there any movement in that? What is the justification for the $50, or has it just been plucked out of thin air, or is it consistent with any other pieces of legislation? In essence, those are the basic questions. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000571\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EAs I say, I do note Trevor Mallard\u2019s ruling from the Chair that debates continued\u2014maybe it was a ground-breaking ruling; I do not know. Last week he made it very clear that if Ministers were prepared to answer questions, then that may aid in the efficiency of debate and its conclusion. But where Ministers did not, then\u2014these are very serious questions\u2014that did not aid the debate or contract its longevity. So, as I said, the simple question is: are these provisions for non-active trusts consistent with the status quo? It is very simple. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000572\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EI think it would be helpful to actually get that on the record of the House\u2014that these issues are in Hansard. Hansard is quoted in case law and is quoted in the courts. If it is not consistent, then what would be helpful is to outline what the changes are and why, and what the justification for those changes is. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000573\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EI think that is a reasonable request to make, given that there is a plethora of family trusts around the country. Many folks have them. Again, one or two people pull the wool, but family trusts are normally set up for very, very good reasons, in respect of protection of family assets, protection against being sued, or whatever\u2014risk management. It is very difficult now, I would argue\u2014not wholly, not totally difficult, but it is reasonably difficult\u2014to pull the wool if the Inland Revenue Department is actively looking at these trusts. On that point, it would be helpful to know whether, if these rules differ from the status quo, the Inland Revenue Department going to embark on any special policing, any special auditing, or any special, legitimate interrogation of trust arrangements to ensure, especially under this piece of legislation, that if they are non-active they really are non-active. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000574\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EYou can make an argument and say well, if you put it in writing to the Inland Revenue Department that it is non-active, you are not making income, and you are just like any other taxpayer you are committing fraud and you are lying if you say \u201Cno income\u201D and there is income. That is true, but I would have thought, given that this is a new piece of legislation, that the Inland Revenue Department\u2014if, again, it is very serious about cutting down on speculative investment\u2014would be running the ruler over many of these entities, not in a nefarious way but to ensure that people are complying with their obligations. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000575\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003ESo I simply raise those questions, and I would hope that the Minister may be able to give us some sort of answer to them.\u003C/span\u003E\u003C/p\u003E\u003Ca id=\u002257f0cb320d514cbb87287aaf6aa1ec60\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 2 be agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EAyes 109\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand National 59; New Zealand Labour 32; Green Party 14; M\u0101ori Party 2; ACT New Zealand 1; United Future 1.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENoes 12\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand First 12.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EPart 2 agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000576\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u0022be2cb8f7ba394bd4b6090417d4054cc0\u0022\u003EClauses 1 and 2\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022 data-id=\u002263d437e0d5aa4cdf83353578007b717a\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000577\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002263d437e0d5aa4cdf83353578007b717a\u0022\u003EHon CLAYTON COSGROVE (Labour):\u003C/span\u003E Normally\u2014and forgive me, there may well be a wee bit of humour injected into the following speeches in respect of the title because, I have got to say, this bill could have a variety of titles. Most of them, I have got to say, are pretty negative. Todd McClay\u2014this is the sort of \u201Chospital pass\u201D bill from Todd McClay. It seems that since the Hon Todd McClay got this portfolio from Peter Dunne, we have had a litany of difficulties from substandard legislation coming in, from cost blowouts around liable parent contributions, to cost blowouts around\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000578\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002257e41e9d-285b-4fb3-847d-a63820ae7137\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002218d02cba73654abda0b7d761bf1513aa\u0022\u003EChris Bishop\u003C/span\u003E: That\u2019s unfair.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000579\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022f1b0ad37601d4079a46b0a90dac8ae6e\u0022\u003EHon CLAYTON COSGROVE\u003C/span\u003E: \u2014it is not unfair; I am actually defending your Minister\u2014the Business Transformation project, where money just flows like water, or, to use the biblical expression, they are raking in the sheaves in the Inland Revenue Department. Mr McClay walks along\u2014as I have said before, the guy with the shovel behind the elephant to clean up the mess\u2014and we are delivered this. I think this is a nonsense bill. It could be called the \u201CNonsense Bill\u201D. It could be called the \u201CTodd McClay Inconsistent, Undefined, Incoherent Bill\u201D.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000580\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EIt could be called a lot of things, because as we have seen right through this debate, and I note\u2014to be fair to the Minister in the chair, Paula Bennett, she is not the portfolio Minister\u2014that this is not the first piece of legislation, but the third in the last 2 weeks, where the portfolio Minister has refused to answer any questions and take any calls. To be fair to the Minister in the chair, it is not her basket of goodies, as it were, in a legislative sense, so she may not be well-briefed. She does have some eminent officials behind her, but no questions have been answered. This is a prime example\u2014a prime example\u2014of where the Government has simply blindly wandered into the abyss. The design of this bill was designed to pull the wool over a few people and, as other speakers have said, make it look like they are doing something but not actually addressing the issue.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000581\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003ETerry Baucher, that eminent tax consultant whom we have quoted many times tonight\u2014there is a headline that could be aptly used in respect of this bill. He asks \u201CIs the brightline test an example of enactment in haste, repent at leisure?\u201D\u2014enactment in haste, repent in leisure, I would wager, as would other people. Or as Philippa O\u2019Mara, the director of Engine Room chartered accountants, asked\u2014the headline on her article was \u201CTaxing land transactions: where\u2019s the bright side?\u201D\u2014where is the bright side?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000582\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EIt is interesting that very few, apart from that learned colleague of mine David Bennett\u2014learned colleague\u2014have got up. I will say he took a call. It was an unusual call, but at least he is consistent with his calls. He has got up and tried to defend the bill. But no one\u2014consistent in his inconsistency. No Minister has got up and tried to defend this. No Minister has got up tonight and even proffered an answer to any of the questions, and they have been legitimate questions.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000583\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EYou could call this the \u201CDrive a Bus Through It Bill\u201D, because if we talked about the definition of the exemption in farmland, the definition of \u201Cmain home\u201D, the great intangible connection to your main home\u2014very psychedelic. That is a bit beyond me, I know. But, you know, it is very psychedelic, the sort of great intangible connection. We have got a change of the guard there. Maybe this Minister might answer some questions. No one has got up to even provide an intangible justification for the incoherence and the inconsistency, or even to bat off the vast amount of criticism from the private sector accounting profession.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000584\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EI know the Inland Revenue Department cannot do it, because it has to work through a Minister, but it is surprising. This is supposed to be the great, flagship Budget proposal to deal with property speculation. This is where Mr Key put a stake in the ground and said he is going to do something about it, and then the whole thing just simply peeled like an onion as the Chartered Accountants of Australia and New Zealand, Ernst and Young\u2014you name it\u2014and the Law Society all came in and opposed this and said basically that it was bunkum and that it will not achieve in any way, shape, or form any of the objectives that the Government seeks to go after. It will not do it.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000585\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EFive million dollars is the best estimate of how much revenue will be raised from this bill. Five million bucks, when property speculators are making, what, a thousand bucks a day, I think Mr Twyford said, in terms of increased values and capital gains on property in Auckland, and all it will raise is 5 million bucks. And Mr Bennett said: \u201CHey, we are going after them.\u201D He made a speech earlier today: \u201CWe\u2019re going after them, we\u2019re going after the big fat boys, the property speculators. We\u2019re going after them with the big stick, the big 10-year rule.\u201D Well, if that is the case, if the best he can do is to claw $5 million of legitimate taxpayers\u2019 funds out of them, well, I do not think the stick is that big at all. It is balsa wood\u2014absolute balsa wood. You could call this the \u201CBiggest Hoodwink Yet By the National Government Bill\u201D\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000586\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ebc24a33fae34af690fc43bc92a935d6\u0022\u003EHon Member\u003C/span\u003E: \u201CSmoke and Mirrors Bill\u201D.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000587\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00224c04a11075d24fe4ab3be2544425ed61\u0022\u003EHon CLAYTON COSGROVE\u003C/span\u003E: \u201CSmoke and Mirrors Bill\u201D, my colleague says, because it is typical of the National Government. It is a bit like the refugees thing. Suddenly we are against it, we are against it, we are against it, then Crosby/Textor and the pollsters come back and say the position is unsustainable\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000588\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002257e41e9d-285b-4fb3-847d-a63820ae7137\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022591f642fcc9e43b887a0d3703202c4a0\u0022\u003EChris Bishop\u003C/span\u003E: Here we go.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000589\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022ea71564b08384416a12368b020c8ad79\u0022\u003EHon CLAYTON COSGROVE\u003C/span\u003E: Mr Bishop, in his former profession, would know all about that, of course. He would know all about that, and a few of his mates who are not here now. And suddenly the feet are put to the fire. Mr Bishop gets together with Steven Joyce and a few of the gurus and goes: \u201COh, we cannot sustain this position, because the people have woken up. They have woken up from their slumber and worked out we are having them on, so we had better do something.\u201D \u201CNow, we do not want to do too much because that is against our ideology\u201D, says Mr Bishop, \u201Cbut we had better do a bit, just to make it look good around the edges.\u201D You know, a few refugees here, there, and everywhere, as they did with that issue, and then they come in with a big stick saying \u201CWe are going to make a decisive move to deal with property speculators, especially in Auckland.\u201D, and we get this bill.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000590\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EAnd Treasury says: \u201CLook, it is not going to work, Minister and Prime Minister. You need a 5-year rule, not a 2-year rule.\u201D That is rejected. Ernst and Young, Chartered Accountants Australia and New Zealand\u2014all the best experts come in and say: \u201CMinister, it\u2019s not going to work. It\u2019s going to do the opposite of what you want. It\u2019s not going to go after the property speculators because they will just hold for 2 years and 1 day. It is going to go after mum and dad, Mr and Mrs Smith, who fall on hard times, have no choice but to sell the house, and they are going to get pinged by it.\u201D \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000591\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EAnd the Prime Minister and Mr Bishop, because he is a tactician of great note, and Steven Joyce and Todd McClay are in the room, and they go: \u201COh, don\u2019t worry about it. We\u2019ll flick this one past the keeper. We\u2019ll fire one out the back line. The people won\u2019t know. We\u2019ll hoodwink them again.\u201D\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000592\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EWell, the problem is that it is very rare, especially in a piece of tax legislation, that you abrogate the generic framework and you get almost the entire profession coming out saying that this is a load of the proverbial\u2014you know, bull. Except it is quality bull for the National Government. This is what the National Government is up against. So you could call it\u2014I know the Chairperson is looking slightly worried but I will not continue that analogy. Trust me, I am not that bad. But this is the \u201CSmoke and Mirrors Bill\u201D\u2014this is the \u201CSmoke and Mirrors Bill\u201D.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000593\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EFor all those young people sitting out there, hoping even as they listen tonight or saw the announcement about this bill, thinking \u201CHey, maybe for once the Government is going to do something to deal with the speculation, and get a bit of a handle on the property prices in Auckland and around the place so that young people can get a fair go.\u201D\u2014they really probably wanted this thing to work, but people are going to be sadly and tragically disappointed.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000594\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EI will make Mr Bishop a bet, whatever he wants. I will make him a bet that we will be back here before the next election, putting elastoplast over this. We will regurgitate the Hansard, such that it is, because Mr Bishop did not take a call, Mr Muller did not take a call, the guy there whose name I cannot remember who is on Finance and Expenditure Committee\u2014\u201CDick Cheney\u201D, or whatever his name is. He did not take a call\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000595\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00227d54a28db85d47b7837e67435ed4726f\u0022\u003EThe CHAIRPERSON (Hon Trevor Mallard)\u003C/span\u003E: Order!\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000596\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022498ff533d45e48cfa2bb6c1a595c5762\u0022\u003EHon CLAYTON COSGROVE\u003C/span\u003E: A memory lapse.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000597\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002290ce8f2b85554687b4b4762fd27bd05c\u0022\u003EThe CHAIRPERSON (Hon Trevor Mallard)\u003C/span\u003E: Order! No, no. I ask the member to sit down. It is an old habit but not a good habit to treat people in that way. If the member genuinely does not remember peoples\u2019 names, then just do not refer to them in that way at all.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000598\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022d2b412edc5984c31a24c893c40358703\u0022\u003EPhil Twyford\u003C/span\u003E: A senior member having a senior moment.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000599\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022598e26ef143447f0bd4b93bbda70b406\u0022\u003EHon CLAYTON COSGROVE\u003C/span\u003E: I am having a senior moment\u2014yes, indeed. But we will regurgitate the Hansard such that it is, but it speaks volumes that not one Minister could get up here and even put up a tacit defence on this\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000600\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022713e45d41da74ea08cdfcd498c368cfd\u0022\u003EPhil Twyford\u003C/span\u003E: Not even one.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000601\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002257f562a14c6944e6ba330cdd9c58de8e\u0022\u003EHon CLAYTON COSGROVE\u003C/span\u003E: Not even one. Normally they will get up and have a crack and poke a bit of borax at us and at least defend the principle. The Minister of Revenue must have gone down a burrow in this Chamber somewhere, because he has not taken a call on the bill throughout the whole debate. It has been left to other Ministers. Obviously officials are not needed, because they were not asked for any advice because the Government is not going to answer any questions. So we will regurgitate the Hansard as we come back to try to stitch this thing up.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000602\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022f9c512a8-d532-4ef9-ad51-0fe8d752a893\u0022\u003EI lament in some ways that we are supporting this bill but, as Mr Twyford and others have said, I suppose anything, anything, even this feeble attempt, this whitewash, this con to the New Zealand people\u2014I suppose even that is better than nothing. But as I have said occasionally over the years, the National Government has got to realise that people are not dumb. People work it out. They will work it out\u2014even that member over there. I give him a bit of credit. People are not dumb. They will work this out. They will work out that it is the big end of town that is getting the advantage here. Let us examine this. Let us make a prediction\u2014\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022 data-id=\u00222bb0dbc7c0084ddfb095772cdded0ca5\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000603\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00222bb0dbc7c0084ddfb095772cdded0ca5\u0022\u003EHon DAVID CUNLIFFE (Labour\u2014New Lynn):\u003C/span\u003E I seek a call on the title and commencement clauses of the Taxation (Bright-line Test for Residential Land) Bill, and I would like to put them the other way round and actually go to the commencement date, which is 1 October 2015. We are not only passing bad law by, I think, the House\u2019s general admission that this bill is not well conceived; it is not effective as it will raise only $5 million. And according to the tax profession it is likely to have the perverse effect not of catching genuine property speculators, who can easily avoid the bill\u2019s imposition by holding property for 2 years and 1 day or redefining it, but of actually hitting families who are in the position where they have to sell for either financial or relationship reasons. That is a perverse outcome. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000604\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003ESo why are we doing this retrospectively? Why are we passing in November a bill that has its commencement date in October? I think the answer to that is it is a Budget special. It goes, I think, to Mr Cosgrove\u2019s point that the polling must have come in just prior to the Budget and the realisation dawned on Ministers as they sat feverishly around the Cabinet table that they were in trouble, because they needed to be seen to be doing something about the Auckland property market: what could they do that was simple, quick, and would not actually penalise the constituencies that they are there to represent, which are the owners and holders of big capital? So they came up with this little beauty. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000605\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EI remember thinking on Budget day: \u201CGosh, a brightline test. That\u2019ll clarify the former subjective intent test.\u201D I thought: \u201CWell, that might be a good thing, to be fair to them.\u201D And thank you to the profession, because when the accountants came in and the lawyers came in and testified to the Finance and Expenditure Committee, they made absolutely clear that this bill was rubbish\u2014absolute rubbish. Officials, who would be providing free and frank advice\u2014at least if Iain Rennie ever stood up for them\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000606\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002257e41e9d-285b-4fb3-847d-a63820ae7137\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022b691df75581b469a852eedff813b42c8\u0022\u003EChris Bishop\u003C/span\u003E: Oh!\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000607\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022e3067dee16e14c0687b9a428d1f72eab\u0022\u003EHon DAVID CUNLIFFE\u003C/span\u003E: Yes, Mr Bishop, if the State Services Commissioner ever stood up for Public Service prerogatives, which in a former life that member specialised in running down because they shall do as the Minister says, not as the facts say. But, nonetheless, officials have said on this bill that it will raise only $5 million\u2014raise only $5 million\u2014so it must have ticked all the boxes for urgent Budget legislation. And then it had a truncated select committee process, which identified but could not fix the fundamental problems with the bill. We have been through most of them in Part 1 of this bill. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000608\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003ENow we are committing the double sin of passing hasty legislation retrospectively. Why? Because it is poll-driven, fruitcake stuff. That is what it is. It is the veil of progress when there is no progress. It is the impression of genuine tax legislation when it is not. That is why we are doing it retrospectively, with a truncated select committee process. It was a rabbit pulled out of a hat to make the Budget look better than it was. That is what the public can all see. It is what the profession can see. I think it actually proves the point to members opposite and to the Government that in the end it is good law\u2014good law based on good advice\u2014that will make a difference. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000609\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003ESo what shall we call this bill? What should its title be? The \u201CBand-aid Tax Bill\u201D? The \u201CCrosby/Textor Tax Bill\u201D? With due respect to our revenue spokesperson, the \u201CClayton\u2019s Tax Bill\u201D? The \u201CTax Bill You Have When You\u2019re Not Having A Tax Bill\u201D? Is it the brightline test you have when you actually do not want to catch anybody out that might otherwise be your friend, a donor, a supporter? Goodness knows the property speculators and the banking community will not be waiting up at night to see whether this bill has been passed. They will be sleeping soundly in their feather-fluffed beds. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000610\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022e0192ed9-5715-4f6c-bd52-8db4f3466087\u0022\u003EThis bill does almost nothing\u2014almost nothing. Maybe that is the proper title for it: the \u201CAlmost Nothing Tax Bill\u201D. Or maybe it is the \u201CWaste of Paper and Time Tax Bill\u201D, because that seems to have been its main impact on the House. You would think that after 7 years in office and all the resources of Treasury, the Inland Revenue Department\u2014with its $1.5 billion computer fiasco\u2014that the current Government could have thought of something just a bit more substantive when it was seeking to address, apparently, one of the most critical economic challenges of our age, which is the twin disasters of Kiwi families being locked out of the dream of homeownership and the misallocation of capital towards speculation not investment in productive business. \u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022 data-id=\u0022ba1ee376465549a7837c8debb1570b56\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000611\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022ba1ee376465549a7837c8debb1570b56\u0022\u003EPHIL TWYFORD (Labour\u2014Te Atat\u016B):\u003C/span\u003E I think by some oversight this bill has been misnamed. I wonder whether it is possible to put up an amendment in the title and commencement clauses part of this debate to rename it. I think a much more accurate description of this bill would be the \u201CTaxation (Trying to Manage the Optics) Bill\u201D, because that is basically what this bill is. It is an exercise in political cynicism. It points to, I think, an interesting sequence of political responses that this Government has made to the housing crisis. In the first couple of years, it was clearly hoping it would go away\u2014that if it did nothing, if it sort of played dead and played possum, did not move, then maybe the housing crisis would just pass right over them, and nothing would happen. But it became clear, I think, about 3 years ago that the housing crisis was inflicting some pretty serious damage on the Government. It put Nick Smith in the job of being housing Minister. The strategy ever since then has, essentially, been to look as if they are doing something, and this bill is a classic of its kind. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000612\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003EIt is all about the optics. It is all about trying to do as little as possible while actually conveying the impression of activity. We have seen exactly the same thing go on with the whole issue of non-resident foreign buyers. Members on that side of the Chamber have denied, denied, denied, and rubbished the idea that offshore speculators were having any kind of negative impact in the Auckland housing market, and then when this bill was announced its companion was a bill that required non-resident foreign buyers of residential property to register with the Inland Revenue Department. Another nothing, another bit of flimflam from the National Party designed to make it look as if it is doing something, even though it has denied that foreign buyers are an issue. It is designed to make it look as if it is doing something, while having negligible impact. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000613\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003EWe have seen it with the special housing areas. Again, this was a big flagship initiative to increase the supply of housing, like this bill basically tackling one of the main causes of the housing crisis. In this bill\u2019s case, that is property speculation. The special housing areas, as we saw today, have delivered only 102 houses in Auckland over the last 2 years, but there has been an interesting evolution, actually. At the same time that we have been discussing this bill at the Finance and Expenditure Committee what has happened is that the Government\u2019s strategy has shifted a little bit, interestingly. I think it is so nervous that the Auckland housing bubble will pop on its watch. The very people whom John Key has been pandering to, not wanting to do anything that might disturb the upward trajectory of house prices\u2014up $180,000 on average in the last year\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000614\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00222eb5c2ed0e7d444bb2a32d65f2f28190\u0022\u003EThe CHAIRPERSON (Hon Trevor Mallard)\u003C/span\u003E: I am now warning the member to actually speak to the bill\u2014it is not a general debate on Auckland housing. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000615\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00228252608f939842be962184b112b7b8aa\u0022\u003EPHIL TWYFORD\u003C/span\u003E: The thing that this bill purports to tackle\u2014the rampant property speculation in Auckland that has been driving prices higher and higher, that has delivered an increase of $180,000-plus on the average Auckland house in just the last 12 months\u2014threatens the very economic stability and financial stability of our markets and the well-being of a third of this country\u2019s population. And probably more, because if the bubble in Auckland bursts, there will be egg on a lot of people\u2019s faces. It will damage the livelihoods of a huge number of people and probably tip the entire economy into recession. This bill will do nothing about that. It will do nothing to foreclose on that scenario, and that is not only an act of political cynicism but an act of utter irresponsibility. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000616\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022cbc37df2-57ae-4536-94ed-a2e39eecd585\u0022\u003ESo the finance Minister is reduced to now being a commentator, talking up the risk of the bubble bursting while his Government is shepherding this bill through the Committee\u2014a bill that will make little if any difference at all. All the commentators have said it, from the moment it was announced prior to the Budget. The Law Society, the accountants, Ernst and Young, KPMG\u2014all of the submitters who came along to the select committee have just torn this bill apart and said that it is a chaotic, confused piece of legislation.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022 data-id=\u002209e4eeab24e849e084c767306b8e9882\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000617\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002209e4eeab24e849e084c767306b8e9882\u0022\u003ESTUART NASH (Labour\u2014Napier):\u003C/span\u003E The great thing about the English language is that words have different meanings. Sometimes in this sort of legislation it is hard to know which meaning to take. I mean, we are talking about a brightline test. If I look it up in the Oxford Dictionary, which is sort of acknowledged as the pre-eminent dictionary amongst dictionaries, the definition of \u201Cbright\u201D is \u201Cgiving out or reflecting light\u201D. This bill gives out no light whatsoever. Another definition is \u201Cvivid and bold\u201D. There is nothing vivid about this, and it certainly is not bold. Another definition of \u201Cbright\u201D is \u201Cintelligent and quick-witted\u201D. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000618\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EI remember about 5 or 6 years ago the Inland Revenue Department published a paper on the cost of speculation\u2014i.e., the cost of speculators not paying tax and hiding behind things like the intention test. So the Government brings this bill in. It acknowledges there is a problem, so the Government brings in this piece of legislation, which has the word \u201Cbright\u201D in it, in order to fix the problem, and then the Minister of Finance comes out and says: \u201CIt\u2019s only going to raise $5 million.\u201D How do you go from a problem of $250 million a year to raising only $5 million? \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000619\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EThis is the \u201Cnot so brightline test\u201D. It is an absolute fail. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000620\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EIf we have a look at the Oxford Dictionary definition of the word \u201Ctest\u201D, it is \u201Ca procedure intended to establish the quality, performance, and reliability of something,\u201D. Well, if this is a test\u2014\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000621\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002281825190-fd5d-4ed0-bb80-f12f3c93e653\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u0022cca6c1ca6b434d6782cc90bf9a459213\u0022\u003ERino Tirikatene\u003C/span\u003E: It fails.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000622\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00228ff9b4dbceae473eb82d3870437a99b4\u0022\u003ESTUART NASH\u003C/span\u003E: \u2014you are dead right, you are dead right\u2014this fails on every single measure. The reason I say that is that, first of all, the industry does not like it; secondly, it is not going to make any difference; thirdly, it has wasted a whole lot of time in this House; and, fourthly, it is retrospective, like my colleague Mr Cunliffe talked about before. This is tax legislation. It is not supposed to be retrospective. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000623\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EWe all know how this law was made. We know how this law was made. Mr Key had one of those brainwaves\u2014you know, \u201Cthe intelligent and quick-witted\u201D. Unfortunately, the way it was translated\u2014you can imagine it at the Inland Revenue Department. They were sitting there when Mr Key and Mr McClay came out and said: \u201CI know. Let\u2019s put a 2-year brightline test in.\u201D You could hear the guys at the Inland Revenue Department saying \u201CNo, please, please don\u2019t bring this before us.\u201D, and he did\u2014and he did. So the Inland Revenue Department officials had to come to the Finance and Expenditure Committee, and you could see them\u2014you can tell when they are forced to put legislation in place that they do not like, because the eyes sort of drop. Mr Cosgrove goes hard and asks \u201CWhat about this? What about that?\u201D, and they do not really have the answers. The eyes drop. There is no enthusiasm. The Inland Revenue Department\u2014not only KPMG and not only the lawyers but the Inland Revenue Department\u2014knows that this is not good legislation. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000624\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EBut what I would say is that there is one group of people, one industry, that I think believes this is really good legislation, and that is the speculators. It is the speculators. As acknowledged by everyone, this is not going to catch those speculators in any way, shape, or form. The $250 million avoidance industry may now be the $245 million avoidance industry, but there is still a really big industry out there. So this is a bill you have when you are not actually having a bill\u2014I must admit the phrase has been used before. But, goodness me, it is not good legislation. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000625\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003ESo I think it should be called the \u201CNot So Bright-line Test Bill\u201D because it will not fix anything, it does not give out any light, it does not reflect anything, it is not vivid, it is not bold, it is not intelligent, it is not quick-witted, and it is not a procedure intended to establish quality. In fact, there is nothing quality about this. There is nothing performance about this. In terms of reliability, it is easily avoided. This is not what tax legislation is supposed to be about. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000626\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022bbded2ec-ac25-4a73-a380-3f4d87693084\u0022\u003EWhen we talk about tax legislation around taxing speculator profits, in fact, do you know what? All the experts say it is not intended to drop the price of houses. It is not intended to collapse a bubble or prevent a bubble. It is actually intended to bring those into the tax system who are avoiding it at that point of time. So when Mr Key comes out and says \u201CWe\u2019ve got something. We\u2019ve got a test that we know will dampen the Auckland housing market.\u201D, this sort of legislation is not intended to dampen housing markets. It never is, and it never does. What it is intended to do is bring people into the tax system who currently are not in it, and it fails on that account.\u003C/span\u003E\u003C/p\u003E\u003Ca id=\u002250c9e8e2da48487ab7b53b0dbfbf5136\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 clause 1 be agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EAyes 109\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand National 59; New Zealand Labour 32; Green Party 14; M\u0101ori Party 2; ACT New Zealand 1; United Future 1.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENoes 12\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand First 12.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EClause 1 agreed to.\u003C/span\u003E\u003C/p\u003E\u003Ca id=\u00221701bb264d7e48b38b03b08e6e218f4c\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 clause 2 be agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EAyes 109\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand National 59; New Zealand Labour 32; Green Party 14; M\u0101ori Party 2; ACT New Zealand 1; United Future 1.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENoes 12\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003ENew Zealand First 12.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp class=\u0022HpsDivision\u0022\u003E\u003Cspan class=\u0022HpsItem\u0022\u003EClause 2 agreed to.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000627\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=\u0022id201511106fb25f893e954ed5af8f886e805377f3000628\u0022\u003E\u003Cspan class=\u0022HpsSubjectHeading\u0022 id=\u00226c86605dbae14108b6c0dcc00a263b6c\u0022\u003ESupport for Children in Hardship Bill\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000629\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u0022ad768e4189354d09a98f5b0ae46369fc\u0022\u003EIn Committee\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000630\u0022\u003E\u003Cspan class=\u0022HpsSubproceedingHeading\u0022 id=\u002279c3ca79852347738602bcd9c0c12512\u0022\u003EPart 1  Amendments to Social Security Act 1964\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022 data-id=\u0022353391bcc38b4442bdfb29271f7a8e4d\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000631\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022353391bcc38b4442bdfb29271f7a8e4d\u0022\u003EThe CHAIRPERSON (Hon Trevor Mallard)\u003C/span\u003E: I will just make it clear that this is debate on clauses 3 to 10 and the schedule. There are, I understand, Supplementary Order Papers 135, 136, and 137 that also relate to this part.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022c3a88c42-f60b-4cf9-8065-8bfb80a020eb\u0022 data-id=\u002277fc38f907054e7bb37bda88bf34e56f\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000632\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c3a88c42-f60b-4cf9-8065-8bfb80a020eb\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002277fc38f907054e7bb37bda88bf34e56f\u0022\u003ECARMEL SEPULONI (Labour\u2014Kelston):\u003C/span\u003E I am standing to speak in the Committee stage. Firstly, I just want to say that Labour does support the Support for Children in Hardship Bill but we have some major reservations that we will talk about in detail tonight. When we were weighing up whether or not we would support this bill, of course the primary factor that made it difficult is that there is a small offering being made to these families. It is an additional $25 per family per week. In the scheme of things it does very, very little to alleviate the poverty that many of our families are talking about, and we will go into more detail about that. But there are some areas in this bill that we do have major reservations about. We have been looking into them thoroughly, and we have been discussing them in detail with our stakeholders. I am going to talk to at least one of those areas in this speech right now. I guess our primary concern, when really digging down on what this bill does and looking for evidence, is that actually there was no evidence gathered by the National Government when pulling together this particular bill. I think it is very fair to say that this bill has seen a National Government blindly making legislation that is ideology-driven rather than evidence-driven. I think New Zealand should be really concerned about that. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000633\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c3a88c42-f60b-4cf9-8065-8bfb80a020eb\u0022\u003EOne of the areas that we have reservations with is the fact that what this bill does is it changes the requirement for work obligations so that the sole parent has to return to work when their youngest child turns 3, rather than 5. Some may ask: \u201CWhy do you have concerns about that?\u201D. The primary reason we have concerns about that is that there is no evidence to say that these families will be better off by doing that. In fact, when we looked for our own evidence and went and looked at international evidence around this, we found in so many countries, including in the US, where work obligations like this were imposed, and where women were pushed out into the workforce at earlier stages, like this bill requires, in many instances the research says they ended up worse off financially than when they were on welfare. The reason for that, in the research, is that, actually, many of them were forced to take on any work that they could get, any work that they could get into quickly, and more often than not it was poorly paid work. There are issues that have been raised with this particular part of the bill around the safety of children and the fact that these women\u2014largely women; not always women, but largely women\u2014who will be required to return to work when their youngest child turns 3, rather than 5, will have to look for childcare, for early childhood education. We had some concerns about that because we know as a country that recently in our media our academics have been discussing the fact that there are areas in this country where adequate levels of early childhood education are not available, let alone adequate levels of early childhood education that is deemed quality early childhood education. To force these parents back into the workforce when we know that this provision of early childhood education is a real issue is something that we should all be concerned about. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000634\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c3a88c42-f60b-4cf9-8065-8bfb80a020eb\u0022\u003EThere are some Supplementary Order Papers that I have put up tonight. One of them is in relation to the age issue. We will not be supporting the drop from 5 years of age to 3 years of age. In fact, I think I will make it really clear from the outset, despite the fact that we do support this bill because we found it difficult not to because of that small financial offering that these families will be getting, we cannot support the whole of Part 1 and we will be voting against that when we get the opportunity to do so. Part 1 is the part of the bill where we see part-time work redefined from 15 hours a week to 20 hours a week and where we see clauses 4, 6, 7, and 8 reduce the age of children at which the work requirement kicks in for the parents from 5 years of age to 3 years of age. One of the Supplementary Order Papers that I have put up, Supplementary Order Paper 136, deals with those two particular issues. We will not be supporting the drop from 5 years of age to 3 years of age. We are supported by almost all of the submitters in relation to that decision because many of them pointed out the fact that not only is there no evidence to support the fact these families will be better off if they return to work at that point but also there were real concerns that the Government does not support the important role of parenting in this country. We had this discussion at the select committee. Many of the National Government MPs seemed to also not realise that we are not necessarily talking about sole parent households with one or two children, sometimes we are talking about a sole parent who has been left to raise and look after three children, four children, or five children. While I am on that subject I am just going to say how awesome those parents are who make the decision to stick around and look after their children when in all too many cases they have been left by themselves to do that. I think the other side of the Committee fails to grasp that. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000635\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c3a88c42-f60b-4cf9-8065-8bfb80a020eb\u0022\u003EClause 4, which changes the definition of part-time work to 20 hours\u2014so it goes from 15 hours to 20 hours\u2014is not supported by us as well. One of the reasons for that\u2014there are a few reasons\u2014is that, actually, in this country at the moment for 3-year-olds and 4-year-olds we have, supposedly, 20 hours\u2019 worth of free early childhood education per week. If you take into consideration the amount of time that a parent needs to travel to the early childhood education provider, then to work and back to pick their children up, then, actually, if you are saying 20 hours is the amount of time they have to be in work, then there is a fair enough assumption that the travel time and those 20 hours is going to be 22 hours, maybe 23 hours, and if you are in Auckland it could get even more out of control than that. These parents are being pressured back into work but the early childhood education that their children are being provided with is not fully subsidised. When I say \u201Cfully\u201D I mean free like the 20 hours that we were talking about. That is an issue. The other issue with pushing part-time up from 15 hours to 20 hours is that the moment we know there are currently 58,000 New Zealanders looking for part-time work. The fact is that we just do not have that work available for them so it is an unrealistic expectation to think that we can expect these parents to go from looking for 15 hours of work to looking for 20 hours of work a week. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000636\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c3a88c42-f60b-4cf9-8065-8bfb80a020eb\u0022\u003EAlso, I am going to go back to the fact that all too often what it felt like when we were considering this bill was that people were neglecting to realise that, actually, we were talking in some instances about multiple children. It seemed like everyone thought these were single-child households that we were talking about, and that juggling that one child would not be so much of an issue. But we know, actually, the more children you have the harder that is to juggle, but at no point was that ever taken into consideration. Those are the two areas I wanted to talk about at this stage. I know that my colleagues have a lot of other areas they want to talk about, and I am going to stand and talk about some other parts of this bill and my thoughts on those when we get a chance. But I want to make it really clear that Labour does not support reducing the age in terms of work obligations from 5 years of age to 3 years of age for that youngest child, I have laid out really clearly why, and we will not be supporting the increase of hours, in terms of part time, going from 15 hours a week to 20 hours a week. Thank you.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022 data-id=\u0022c98d6c652e03453680e21490aafe2e3b\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000637\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022c98d6c652e03453680e21490aafe2e3b\u0022\u003EJACINDA ARDERN (Labour):\u003C/span\u003E I appreciate the context that Carmel Sepuloni has given on this bill, both as our social development spokesperson and also as a member of the Social Services Committee. I think she has rightfully acknowledged a number of really important people, and not least those who are raising children in these circumstances. But I think we should also acknowledge the fact that this bill has come to the House and acknowledge groups like Unicef, Child Poverty Action Group, and the Children\u2019s Commissioner because they have changed the environment in which we are considering child poverty issues. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000638\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003EThat leads me to then look at the context of this bill and ask, in Part 1, are we addressing what has been identified as the key issue around child hardship, because it is, of course, called the Support for Children in Hardship Bill. It is called that for a very specific reason, and I just want to talk about that a little bit. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000639\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003EThere are 305,000 children in poverty, based on an income measure, but that is not whom this bill targets. We can see that by looking at Part 1 of the bill and clause 3, the \u201CPrincipal Act\u201D, which states: \u201CThis Part amends the Social Security Act 1964.\u201D We are here amending only the Social Security Act rather than amending broader tax credit legislation, for instance, that may affect a wider bracket of children. So of the 305,000 children we know who are in income poverty, we know that two out of five of those children are from families who are in paid work, so they are not necessarily solely dependent on the Social Security Act. We know also that some of those children, however, will be, and they might be picked up. But in fact this bill, if I recall correctly, targets roughly\u2014what is it, Minister Tolley\u201410,000 children of a much broader bracket of children. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000640\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003ELooking at some of the regulatory impact statements to try to get a sense of, if based on information from the Children\u2019s Commissioner, we know that there are\u2014and this is incorrect now; it is higher\u2014305,000 in income poverty, where in this definition the bill was targeted. The Government was quite clear that it wanted to target material deprivation, and that is what is then translated into hardship material deprivation, which in New Zealand is roughly about 180,000 of those children. Those children are ones who, based on a scorecard, are determined to have a certain number of enforced lack\u2014things that families cannot afford to purchase in order to make sure that their lives reach a certain standard of living. That is where the Government said it wanted to hone in. How then did we end up with amending just the Social Security Act in order to target material hardship? Well, we can see a little bit as to why that is, in the regulatory impact statement. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000641\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003EOne of the first bullet points in the regulatory impact statement states: \u201CThe fiscal envelope available for the package\u201D\u2014that this bill is set around amending social security\u2014\u201Cwas based on Ministerial considerations of New Zealand\u2019s current fiscal position and other competing priorities. The Government indicated scalable options should be developed within a fiscal range for the package of up to $1 billion over four years ($250m per year). Because the Government\u2019s overall objective was to take more immediate action to reduce material hardship amongst children, Ministers signalled an interest in options that would relatively quickly improve the material resources available to a family through the package.\u201D \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000642\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003ESo we have got two indications there. They want it to be quick and they want it to be within a limited fiscal package. That is important because in this bill, in Part 1, instead of an amendment to the Social Security Act we could have been debating an amendment to the Working for Families framework. We could have actually been debating here tax legislation instead of benefit legislation. Why were we not? Well, when Bryan Perry came to the select committee, at his last appearance, I asked that question: \u201CWhy, Mr Perry, did the Government not amend the family tax credit instead of the Social Security Act?\u201D. As this Committee will well know the family tax credit goes both to beneficiaries\u2014which counters the Minister\u2019s claim that this is the first time there has been an increase in income for beneficiaries; Working for Families did that too\u2014and to low-income families. So it would not have targeted just the material hardship kids; it would have targeted the income poverty kids as well. That is an important difference to point out as we debate Part 1 of this bill, because it is still a grave disappointment to me that we are debating just the Social Security Act instead of tax legislation. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000643\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003EThe second reason why it is a disappointment that we have narrowed the frame to the Social Security Act is that Jonathan Boston had done a considerable amount of analysis about what it would take not just to increase the incomes of families in hardship but to lift them over the poverty line. The Minister in the chair, the Hon Anne Tolley, knows as well as Labour knows how difficult it is to do that, and the reason we know that is that we did the analysis ourselves when we looked at the Best Start package. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000644\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003EBoosting a family not just up but out of poverty means getting them out of that 60 percent median income threshold, or maybe, if you are going to be a little tighter\u2014because we know that there are two measures\u2014there are 305,000 at 60 percent of the median income or less, but those at the hardest end of poverty are at 50 percent or less of the median income. Lifting those kids out, as Jonathan Boston modelled, would take a lot more than what this amendment to the Social Security Act does. We are looking at up to, in reality, not much more than 20 bucks, whereas on Jonathan Boston\u2019s modelling it is more like $60 if you actually want to make a significant difference\u2014and per child. An important point here is that this is not a per-child payment that we are debating in Part 1. We are debating a per-family payment. So we know that the amendment to the principal Act, the Social Security Act, is not substantive in that regard and will not necessarily make the difference to children in hardship that this bill purports to make. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000645\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003EWe are also equally worried, as my colleague has pointed out, about some of the Part 1 changes in definition. Whilst the Government was chucking out this carrot it obviously decided it needed a stick. I find that really disappointing, because overwhelmingly this change was welcome. That stick was not only entirely unnecessary but was actually to the detriment of the families the Government was trying to help, and we see that in clause 4 with the change of definition of the term \u201Cpart-time work\u201D. It now means not less than 20 hours and in combination with that we have also seen a change in the definition of when a family would be work tested. At the moment it is age 5 because we make the assumption that the provision of State schooling kicks in at that point. The Government has dropped it down to age 3. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000646\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003EOne assumes that makes an assumption around the provision of early childhood education, but we cannot assume access to early childhood education in great parts of New Zealand. In fact, in South Auckland, analysis has been done around the gaps in early childhood education. One simple way that this side of the Chamber and my colleagues Poto Williams and Carmel Sepuloni have put it to the select committee was creating a carve-out to say if you cannot access early childhood education then these clauses should not apply to you. Those tests as set out in clause 4 should not apply to you, because, simply, the assumption is that you are freed up from carer duties if you are able to have a 3-year-old in free early childhood education. That is problematic if that early childhood education is not available. Surely that is a fair and reasonable clause to put in here, and we tried this in past welfare bills. We have tried to say that we should create a few exemptions and give the discretion just in case. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000647\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003EThe other point that I think is really important to make is that this bill is somewhat naive to the nature of part-time work. Let us be honest about where part-time work exists. Part-time work exists in retail, hospitality, service, and call centres\u2014things that operate outside standard school hours. Yet we have seen before that the way Work and Income operates is that if work is available and it considers it to be fair and reasonable, you have to take it or your benefit is cut, even if it is totally inappropriate when stood up alongside the availability of early childhood education hours. That is another flaw in the bill. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000648\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022aa2209f1-1889-4c24-b51d-cb2aedc7aa93\u0022\u003EIn fact, the regulatory impact statement even acknowledges that in terms of work itself, which the Government is driving as being the sole answer to child poverty, you can still exist in poverty even when you are trying to cobble together work. I want to read out from the regulatory impact statement: \u201CA key driver of child poverty for households with adults on lower wages is too few paid employment hours\u201D. It acknowledges there are not enough paid employment hours, yet we are about to penalise people who cannot find ghost jobs. It is absolutely outrageous that as unemployment grows we are putting in place penalties for the most vulnerable people. Minister, you could have given this carrot without the stick and we would have applauded that.\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002269dfdffa-4227-42b6-875a-fc8033bc25cc\u0022 data-id=\u00225111f79db83948d4ac775b46ebc386e6\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000649\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002269dfdffa-4227-42b6-875a-fc8033bc25cc\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00225111f79db83948d4ac775b46ebc386e6\u0022\u003EJAN LOGIE (Green):\u003C/span\u003E I rise to speak to Part 1 of the misnamed Support for Children in Hardship Bill. This part of the bill does several things. It lowers the child\u2019s age at which parents are required to seek work\u2014it is now from the time their child is 3\u2014and it requires parents to look for 20 hours of work per week rather than the current 15.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000650\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002269dfdffa-4227-42b6-875a-fc8033bc25cc\u0022\u003EI do want to talk to several points around this, and I will start with a rather beautiful quote from the National Council of Women during the select committee process. The council noted that it thought it was a form of insanity that perfectly capable parents are forced into low-paid work while a more expensive worker without necessarily better skills is paid to care for a child. That is what this bill does. It takes away parents\u2019 choices in parenting. It pushes them into what is most likely to be precarious, low-paid work that is\u2014the evidence we had from the New Zealand Council of Trade Unions was that most of the jobs that are available and that many of these parents are likely to be eligible for are night-time and evening jobs. So we are removing parents from their ability to parent and forcing them into unstable jobs that actually lower their chances of increasing their education so they can get to a point of being more likely to be in higher-paid jobs with better conditions that may offer them and their children better life opportunities.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000651\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002269dfdffa-4227-42b6-875a-fc8033bc25cc\u0022\u003EI think that the words of the Salvation Army were also quite telling on this point. It also noted that this bill is forcing parents into work where there is an effective marginal tax rate of 80 percent. It noted, in a way that I found so compelling, that, really, we are risking children of 3 and 4 years of age for such small return. In the Salvation Army\u2019s mind that was irresponsible. The Green Party agrees\u2014that is irresponsible. That is not in our best interests as a society and it is not in the best interests of those children.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000652\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002269dfdffa-4227-42b6-875a-fc8033bc25cc\u0022\u003EI want to go back to another point, about the way this has often been discussed\u2014that the increase in hours from 15 to 20 is just another 5 hours a week and it is no particular big deal, necessarily, in people\u2019s minds\u2014except that the fact is that, as has already been pointed out, there is the additional travel time on top of that, particularly for those families in Auckland. But the key part for me is that 20 hours a week is the threshold that moves you off the benefit. It moves you into dealing with the Inland Revenue Department and not Work and Income.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000653\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002269dfdffa-4227-42b6-875a-fc8033bc25cc\u0022\u003EMany, many parents have had the experience of being encouraged into these jobs and then finding out that their employer actually is not so great when their child gets sick or when they get sick more than the 5 days a year that they may be eligible for, and that they cannot actually manage their needs, the needs of their employer, and the needs of their child, and they need to leave that job. In the existing system, somebody wanting to transition back into the workforce maintains that attachment with Work and Income so that if it goes awry they can go back to their case manager and have that conversation. It is much easier to get that sorted out, whereas now they are off the benefit and they are dealing only with the Inland Revenue Department and their employer. Then they have to go back and reapply. That sets up a whole degree of instability beyond what we have now, and that is incredibly risky. What this also sets up is more potential for sanctions, because there are more requirements from the time the child is 3\u2014this requirement to be looking for 20 hours\u2019 work a week.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000654\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002269dfdffa-4227-42b6-875a-fc8033bc25cc\u0022\u003EWe hear from the Government that if the work is not available\u2014and the point that has been made here previously by Labour speakers is that these jobs are not available. I have heard the Government reply to that with: \u201CWell, you know, if the jobs aren\u2019t available, then that\u2019s fine. They just need to be looking. This is about encouraging them and getting into the jobs.\u201D But there are sanctions that kick in at that intermediary point that would not kick in without this bill, for families when their youngest is 3 years old. That is a big risk when we know that, over a 14-month period, 88,000 people have had their benefit sanctioned\u2014that is 44,000 children in this country who have had their family\u2019s income cut by half because of sanctions put in place by this kind of legislation.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000655\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002269dfdffa-4227-42b6-875a-fc8033bc25cc\u0022\u003EThe New Zealand Council of Christian Social Services pointed out that, I think, two-thirds of those sanctions were because somebody had missed an appointment. We know that sometimes that is happening because somebody\u2019s bus is late. We know that is sometimes happening because somebody has been to a tangi or a funeral and has not been in the position where they are able and thinking to contact their caseworker, or able to get through, and that caseworkers have caseloads of, like, 150 people. So I am certainly not blaming the workers in this equation. It is about the system that we have set up.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000656\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002269dfdffa-4227-42b6-875a-fc8033bc25cc\u0022\u003EThe heart of what I am saying is that we are risking the well-being of our children with these provisions. For what gain? Very, very little\u2014locking their parents into chances of lives of low-paid, precarious work with little financial return. I also want to point out that it has also been noted that currently over 100,000 workers in this country are trying to increase their hours of work. That was evidence from the New Zealand Council of Trade Unions. There are people in this country who have a job and are wanting more hours. Do we really, really believe that parenting is so valueless that we should take the parents\u2019 choice away on how to parent, and be able to push them into that environment and take away the chances of other workers who are trying to increase their hours by saying: \u201CWell, you know, these parents, they should be doing that more than the other workers, even when they could be parenting.\u201D?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000657\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002269dfdffa-4227-42b6-875a-fc8033bc25cc\u0022\u003EI really have to remind this Committee, again, of the fact that there is international research, which indicative research in New Zealand backs up, that 70 percent of these sole parents are likely to be leaving violent relationships. I have worked in refuges and I have worked with the children who are coming out of violent relationships, and one of the things that I have seen time and time again in that situation is the children having different ways of responding. One of the ways is to be really, really angry with their mum and to be keeping on pushing back and pushing back because they have taken on the messages from their dad. The time that is required to break that, to actually re-establish the trust, and to be able to give that child a chance of having a future not determined by that violence is considerable. It is not going to be fixed within the 12 weeks of the work-test exemption that is in place for domestic violence.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000658\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002269dfdffa-4227-42b6-875a-fc8033bc25cc\u0022\u003EOne of the other things that I have seen is where children do not want to leave the side of their mother. Every time she leaves the room, even to go to the toilet, they are worried. They are worried that somehow she is not going to come back. When we are saying that these women, who are trying to re-establish their lives and provide for their children in that situation, have to stop and leave their children and put them into childcare and go into a low-paid job, we are not taking domestic violence seriously. We are not. We are not creating the conditions for us as a society to deal with what is an epidemic of domestic violence. We are doing an absolute discredit to ourselves and our children, and so many other initiatives will actually fail\u2014\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u00220e7e8da2-a6a1-41bb-aeb0-a49be255a293\u0022 data-id=\u00229ab6150b58844e97922fc8a35ffdf544\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000659\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220e7e8da2-a6a1-41bb-aeb0-a49be255a293\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u00229ab6150b58844e97922fc8a35ffdf544\u0022\u003EHon NANAIA MAHUTA (Labour\u2014Hauraki-Waikato):\u003C/span\u003E I want to take a call on Part 1 of this bill. I am concerned that despite the intent of the bill, which we can see in its title, the Support for Children in Hardship Bill, it will actually have the reverse effect. I think that Minister in the chair, the Hon Paula Bennett, should take a couple of moments to reflect on many of the statements that have been made so far, but I would like her to answer a few questions, because the parents of the children this bill purports to help require some answers. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000660\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220e7e8da2-a6a1-41bb-aeb0-a49be255a293\u0022\u003EOne of the questions I have is around the reduction of age for work readiness from 5 to 3. What evidence did the Minister rely on to support a uniform measure such as this? In fact, the member Jan Logie made a comment about attachment issues for children. Usually between 2 to 3\u2014and I am sure the Minister will know, because she understands this as a woman\u2014there are attachment issues, and it is difficult for women, particularly, to leave the home if there are not some strong, key relationships within the household. So what was the evidence to show that reducing the age from 5 to 3 in terms of a mother being tested for work readiness would actually be in the best interests of the child? That is question No. 1. I think it is a fair question that should be asked. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000661\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220e7e8da2-a6a1-41bb-aeb0-a49be255a293\u0022\u003EThe other thing about the reduction in age is that we know, from practical experience\u2014and I know that members throughout the House will relate to this\u2014that often between the age of 1 to 5 is when you are experiencing a number of challenges with the general health of your child. There are numerous situations where unexpectedly you are taking your child to the doctor because of a cough that developed in the night or because they have got eczema. There are all sorts of medical issues that will require you to actually understand your child as they are growing in the most critical stages of their lives. This is often from the age of 1 to 3, but more likely you are getting a grip on it from age 1 to 5. Again, this comes back to the evidence that the Minister relied on that it was in the best interests of the child to drop the age from 5 years to 3 in terms of parents being work-ready and tested for that. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000662\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220e7e8da2-a6a1-41bb-aeb0-a49be255a293\u0022\u003EThe other part of that question is that even if a parent was able to be work-tested when their child is at age 3, if they are living in small communities there are often scarce pickings for jobs. That is a reality. It is not just a statement; it is a reality. So in that instance people might need to travel further afield from their own local community for the prospect of a job. I have heard time and time again\u2014and it is funny that when you are a mother of young children you tend to hear types of stories about children of the same ages as yours\u2014that the demoralising part of going into Work and Income for your work-readiness test is having to tell your story again and again and again and being told that there are no jobs available for a particular period of time. That does not do anything for your self-esteem. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000663\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220e7e8da2-a6a1-41bb-aeb0-a49be255a293\u0022\u003EOne story I heard was of a young mother who wanted to do the best by her child and was helping out at the local k\u014Dhanga, doing things like driving the van, helping to make the kai, and things like that. Then she got notified by her Work and Income case worker that she had to go in for a test, and then she had to really start being active around looking for a job. She saw me at her k\u014Dhanga and she asked me: \u201CIsn\u2019t helping my child at the k\u014Dhanga, and helping the k\u014Dhanga out, a better thing for me and my child and my community?\u201D. I looked her straight in the eye, and I said: \u201CYes, it is. In fact, 15 more hours spent with your child is much better for your child and that k\u014Dhanga community than you going out to work and constantly worrying\u2014constantly worrying\u2014about the care of your child. \u201D\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000664\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220e7e8da2-a6a1-41bb-aeb0-a49be255a293\u0022\u003EThere are other circumstances that put her own views about the safety of her child in another category, but the point, Minister, is that often there are not jobs, and the whole process of going to Work and Income can be demoralising if you are constantly being told that there are no jobs. The issues of travel are very real, especially when you are in a small community. But again, what evidence did you, Minister, rely on to give you an assurance that it was in the best interests of the child to reduce the age from 5 to 3 for work readiness? \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000665\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220e7e8da2-a6a1-41bb-aeb0-a49be255a293\u0022\u003EThe other aspect of this is that in terms of the travel components, if the parent does not have access to their own transport and public transport is not available, the very real challenges of getting to and from a place of work become stressful. If you are a sole parent looking after your children, and you get called at your part-time job and told that you have to come to pick up your child because of an illness or something that has happened at your early childhood centre, it may not be that simple to just go back and get your child. There could be costs. There could be, again, public transport issues that prevent that, and that creates more stress for the parent. It does not help either the parent or the child have a positive environment for the child\u2019s upbringing. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000666\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220e7e8da2-a6a1-41bb-aeb0-a49be255a293\u0022\u003EHere is another question, Minister. If the reality was that the best that a parent could do is find maybe 10 hours of cleaning, and then maybe 5 hours making up for it by driving the k\u014Dhanga van\u2014but they are doing something purposeful\u2014is there enough flexibility in the system for that type of situation to be accommodated? I suspect not, but the question needs to be asked, because we are talking about real people, real kids, and opportunities that are actually the only opportunities available. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000667\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220e7e8da2-a6a1-41bb-aeb0-a49be255a293\u0022\u003EI know that the Minister is dying to get on to her feet and answer some of these very valid questions because they are important, but here is the final point that I would like to make. It is really around the voluntary contribution of parents in respect of assisting in the child\u2019s environment, especially in early childhood education. What we know specifically for M\u0101ori and Pacific families is that lifting the rate of participation in early childhood education is a challenge in and of itself. If there is broader scope to ensure that the contribution of parents in this voluntary way to support their early childhood centre or their k\u014Dhanga or puna reo, will this ever be recognised as a valuable contribution to the raising of children and the building of community? \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000668\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220e7e8da2-a6a1-41bb-aeb0-a49be255a293\u0022\u003EI think it is about time that we did do that, because for far too long we have negated the importance of children\u2019s early years and the value of the contribution of the parent. I agree with most of the sentiments that have been made on this side of the House. Lifting household incomes will make a fundamental difference to alleviating the pressure on some of the most vulnerable families. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000669\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220e7e8da2-a6a1-41bb-aeb0-a49be255a293\u0022\u003EThe question that I have around this bill is about the fact that it does not take account of some of the realities that families are living with on a day-to-day basis, or the valuable contribution that parents can make in those early years by being with their children and not being forced out to work. But, more important, if there is no work, let us get real, Minister. There has to be enough flexibility and scope within the intent of this bill to account for the voluntary contribution that parents can make to raising their child in their community, and spending time with their child, so that there is actually a stronger and more resilient individual coming through the \u201Cpipeline\u201D, in terms of bureau-speak. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000670\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220e7e8da2-a6a1-41bb-aeb0-a49be255a293\u0022\u003EI am concerned about one other aspect, and that is the way in which poverty is being referred to as \u201Cmaterial hardship\u201D. You know, poverty is poverty. There is no gradient about it. It is unacceptable in New Zealand that we do not have a target to actually try to assure ourselves that across all policy areas reducing poverty can be measured in a very consistent way across a range of policies. Minister, I know that you know that these are difficult and challenging issues. What the Ministry of Social Development does cannot be divorced from what happens in housing, what happens in health, and what happens in employment. But if we had a consistent measure around child poverty and how the combination of policies actually impacts on alleviating the pressures for the most vulnerable\u2014our children\u2014in our society, then we would be going a long way towards making a difference. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000671\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u00220e7e8da2-a6a1-41bb-aeb0-a49be255a293\u0022\u003EI fear that this bill will not achieve its intent. It will not support children in hardship; it will actually make things much more difficult. That is the concern. I support the amendments that have been proposed by my colleague Carmel Sepuloni in terms of ensuring that the age reverts back to 5. It needs to happen\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022 data-id=\u0022e1d6ed6fa92f4d15b0d60ed07267d1b7\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000672\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022e1d6ed6fa92f4d15b0d60ed07267d1b7\u0022\u003EThe CHAIRPERSON (Hon Trevor Mallard)\u003C/span\u003E: I am going to call Poto Williams, but as I do that I think I should explain to members that in deciding who gets the call, members of a select committee tend to get some preference, but Ms Williams has been calling now for over half an hour, which is much longer than any other person who is seeking the call. \u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022 data-id=\u002268d564db53af465bbff507bef542d9cc\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000673\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u002268d564db53af465bbff507bef542d9cc\u0022\u003EPOTO WILLIAMS (Labour\u2014Christchurch East):\u003C/span\u003E Kia ora. T\u0113n\u0101 koe, Mr Chairman. Thank you for the opportunity to speak to this bill in the Committee stage. In this contribution, one of many I hope to take over the course of this Committee stage, I too want to keep my comments specific to subclauses (2) and (3) of clause 4, which are specific to the age your child will be when you are work tested to seek part-time work. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000674\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022\u003EThere are many aspects of this that concern me. As with many people in this House, I too was a single parent of a young child and I know the difficulties that anyone\u2014whether you are parenting, whether you are co-parenting, or whether you are parenting alone\u2014has with young children when you are required to go out to work, and what happens with your child. What concerns me about the lowering of the age at which your child is when you are work tested is that there does not appear to be any evidence given that justifies that that is actually in the best interests of the child. None of the submitters to the Social Services Committee could provide any evidence at all that lowering the age of your child at which you are required to be work tested for part-time work from 5 years old to 3 years old is actually in the best interests of your child. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000675\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022\u003EGiven this bill is called the Support for Children in Hardship Bill, surely the care of your child, as its mother or father or the significant adult in its life, takes some primacy, but there has been nowhere\u2014in the select committee process, none of the submitters were able to provide that evidence. I ask the Minister, please, whether she would take a call and explain to the Committee why the decision was made to lower the age to 3. And why 3? Why not 4? Why not 2\u00BD? Why not 3\u00BD? Why the age of 3? The only reason I could find for the justification for that age was a comment that the Children\u2019s Commissioner made, which was that, on average, when parents return to the workforce after the birth of their child, that child is usually around the age of 3. That is the only evidence that has been submitted to the select committee as the reason why the age should be dropped to 3. There is no other evidence that shows that it is in the best interests of your children\u2014none. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000676\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022\u003EAll of the select committee submitters disagreed with lowering the age. There was not a single one who said they were in favour of lowering the age, so that should be evidence enough to say that this is not a good move and it is not in the interests of the child. Let us quote some of the submitters. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000677\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022\u003EThe New Zealand Nurses Organisation\u2014not only was it concerned for the well-being of parents, but it was also concerned about many aspects of the health of the children\u2014the health and well-being. They say \u201Cthe stricter work testing obligations and punitive sanctions regime\u201D\u2014because let us face it, if for some reason you do not meet the obligations that are required you could face sanctions. There were 80,000 sanctions that happened in the last year alone, and they impacted 44,000 children. When a family is sanctioned it means that money is taken out of their pockets and the children are impacted by that. So the New Zealand Nurses Organisation says that \u201Cthe stricter work testing obligations and punitive sanctions regime\u2014i.e. requiring parents to be available when their youngest child turns three rather than five as at present\u2014is arbitrary and ignores child developmental and differences in family circumstances.\u201D\u2014arbitrary meaning there is no good reason. It is not acting in the best interests of the child. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000678\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022\u003EThey also said: \u201CThe health of both parents and children is a significant consideration in parents\u2019 ability to work outside the home. Nearly a quarter of Aotearoa New Zealand\u2019s children are affected by asthma, for example, and are particularly vulnerable in their preschool years. It is a well-known cause of low and interrupted attendance at school and at work. Parents should not be pressured into leaving young children; if a parent is negatively stressed at work the impact on the children is likely to be negative\u201D. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000679\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022\u003ESome of the contributors have already spoken about the difficulties in entering into childcare services for their children. Many of us know that if your children become sick they cannot attend childcare. If your child cannot attend childcare you cannot attend work. If you cannot attend work, does that mean that your family will have a sanction imposed?\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000680\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c3a88c42-f60b-4cf9-8065-8bfb80a020eb\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u002293f6e195aadd415fa575a3665502202a\u0022\u003ECarmel Sepuloni\u003C/span\u003E: The only other option is leaving them at home by themselves.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000681\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022\u003E\u003Cspan class=\u0022HpsBy\u0022 id=\u00220fbeae8c43eb40839fbf0b8b0b87c6bc\u0022\u003EPOTO WILLIAMS\u003C/span\u003E: That is right. So it leaves very few options. Particularly for people who parent alone it leaves very few options, and it is not acting in the best interests of the children. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000682\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022\u003EYoung children, particularly in the ages 2 to 3, do get sick often, and when they are sick, as I say, they cannot go to childcare. Where are the services to be set up to support that parent to have some other form of childcare that does not involve going to a public childcare service, such as private in-home carers\u2014is that going to be available? Where is the support from the employer when parents have sick children? We know that many of these parents are in precarious, low-paid employment where employers can get another worker at a moment\u2019s notice. So if they have any sense of unreliability about them, particularly if they have children who are sick and they have to stay home and care for them, they are likely to not be employee of the month and to potentially lose their jobs. How is that in the best interests of their children? Minister Tolley, I really, really urge you to stand and take a call on this. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000683\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022\u003ELet us see\u2014what else have we got here? Oh, yes, I do want to talk about the Council of Trade Unions, because it spoke not only of the 58,000 people seeking part-time work but of the 100,000 part-time workers who are currently looking for more hours. So we are going to require these parents to seek work. We all agree that being in work is beneficial\u2014well-paid work, secure work\u2014but balance that against the pressure that they come under to find work when there are 100,000 part-time workers seeking more hours, diminishing the pool of part-time work available. \u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000684\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u0022c0e0c86e-e14d-4daa-9bc8-1b5a3d7defeb\u0022\u003EIt also says\u2014this is the Council of Trade Unions submission\u2014that \u201CSingle mothers in particular face a range of economic penalties as well as social difficulties. They are more likely to find only unpredictable, part-time work, making it hard for them to access the childcare and other support they need in order for work to be feasible.\u201D Childcare is not universally available across the country at a time that is suitable for when you may or may not be required to work. We know that many of these parents will be in roles that may be shift work. They may be outside of the normal hours of childcare arrangements. What then? What then? Are they to be\u2014how are they to be in a position where they can find part-time work\u2014\u003C/span\u003E\u003C/p\u003E\u003Ca name=\u0022member\u0022 data-type=\u0022article\u0022 data-memberid=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022 data-id=\u0022a177a8cc9f2845fd9ae32479658534cf\u0022\u003E\u003C/a\u003E\u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000685\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022\u003E\u003Cspan class=\u0022HpsByToc\u0022 id=\u0022a177a8cc9f2845fd9ae32479658534cf\u0022\u003EThe CHAIRPERSON (Hon Trevor Mallard)\u003C/span\u003E: I regret interrupting the member, but the time has come for me to report progress.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000686\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022\u003EProgress to be reported presently.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000687\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022\u003EHouse resumed.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000688\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022\u003EThe Chairperson reported the International Finance Agreements Amendment Bill without amendment, the Taxation (Bright-line Test for Residential Land) Bill without amendment, progress on the Support for Children in Hardship Bill, and no progress on the Weathertight Homes Resolution Services Amendment Bill.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000689\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022\u003EReport adopted.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000690\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022\u003EThe House adjourned at 9.56 p.m.\u003C/span\u003E\u003C/p\u003E\n      \u003Cp id=\u0022id201511106fb25f893e954ed5af8f886e805377f3000691\u0022\u003E\u003Cspan class=\u0022HpsNormal\u0022 id=\u002279db8b64-1f9b-4416-9b81-a12963db9cbf\u0022\u003E\u003Cbr\u003E\u003C/span\u003E\u003C/p\u003E\n    \u003C/div\u003E\n  \u003C/body\u003E\n\u003C/html\u003E"