Tuesday, 12 October 2004

Tuesday, 12 October 2004

Tuesday, 12 October 2004

Mr Speaker took the Chair at 2 p.m.

Prayers.

Motions

Bali Bombing—Second Anniversary

Hon PHIL GOFF (Minister of Foreign Affairs and Trade): I move, That this House note the second anniversary today of the Bali bombing, recall with sorrow the lives lost and damaged by the actions of terrorists, and condemn the ongoing acts of terrorism that deliberately target the lives of innocent people. Two hundred and two people, three of whom were New Zealanders, perished in Bali on this day 2 years ago, and hundreds more were injured and traumatised. Since that appalling event further lives have been lost through terrorism in Jakarta, Madrid, Beslan, the Middle East, and other countries. In cooperation with the international community, New Zealand will continue its efforts at home, in the Pacific, in Afghanistan, and elsewhere to oppose terrorism and tackle the conditions that foster it.

Dr the Hon LOCKWOOD SMITH (National—Rodney): The National Party strongly supports this resolution. Our thoughts today go out to the families and friends of the 202 innocent people whose lives were so horrifically ended in Bali just 2 years ago. To the families and friends of the three New Zealanders who were murdered there, we pass on our most sincere condolences. We also send our sympathies to Prime Minister, John Howard, and the people of Australia, who lost so many friends, family, and loved ones. New Zealand stands with you on this day of commemoration.

It is with heavy hearts that today we commemorate this second anniversary of the horrific bombings in Bali in October 2002. Just over a year after the shocking terrorist attacks of September 11 innocent people were again cruelly targeted in a disgusting terrorist attack, the likes of which are sadly becoming more commonplace. It is only 5 weeks ago that we stood here to mourn the despicable targeting of children by terrorists in Beslan. Only 2 days after that a bomb exploded outside the Australian Embassy in Jakarta. Such shocking and despicable attacks were once unthinkable. Today’s sad commemoration reminds us that the tentacles of terrorism now reach everywhere, and we must stand resolute with the rest of the civilised world to stamp out this abomination of our times.

PETER BROWN (Deputy Leader—NZ First): Today 2 years ago there was a dreadful event—a dreadful event for New Zealand, a dreadful event for Australia in particular, and a dreadful event for the world. Young people do not go on holiday to be subjected to acts of terror and terrorism; they go on holiday to enjoy themselves and to have some fun in their youth. It was almost beyond belief that they were blown apart by terrorist action. On a worldwide scale, nation by nation, religion by religion, that is simply not acceptable. That message must be strongly delivered and finally accepted by all. As a result of the Bali bombing, many families are traumatised and are likely to be so for the rest of their lives. We must ensure that the people who died in Bali did not die in vain. As a small nation our contribution towards combating terrorism, although it might be limited, must be significant and positive. We must send a strong message. We must also be vigilant. New Zealand First supports the motion.

KEITH LOCKE (Green): The Green Party adds its voice to the preceding speakers, in extending our sympathy to the families of the New Zealanders and the many others who died in that horrific bombing, and whose families are suffering so much, 2 years later. We also congratulate the Indonesian and Australian police on working together to track down the perpetrators of this vile crime and bringing them to justice.

Bringing individual such as these to trial is not enough. As we have seen, there will be more bombings until we can remove the grievances that, unfortunately, enable such terrorist groups to recruit new bombers and commit new atrocities. Therefore, actions such as the withdrawal of American troops from Iraq and Afghanistan would go a long way to further isolating terrorist groups in the Islamic world, such as in countries like Indonesia, and reducing the threat from these terrorist groups.

RODNEY HIDE (Leader—ACT): The ACT party supports the motion. Two years ago today terrorism was brought into our homes, into our country. Although the bomb went off in Bali, three New Zealanders were among those who died. We are a small country, so we are only one or two people removed from the New Zealanders who died that day.

It also brought terrorism home to Australia in a large way, and reminded us that what we face with terrorism is not something happening on the other side of the world. New Zealanders do travel all over the world and are exposed to the sort of shocking crime that was committed 2 years ago. I hope our Government is determined, through the Indonesian Government, to see that the perpetrators of this evil deed are fully punished, and I hope that we take a lesson from this terrible, terrible crime and recognise that as a country and as a people we have to stand shoulder to shoulder in the fight against terrorism.

Hon PETER DUNNE (Leader—United Future): Two years ago today events in Bali shook our part of the world in a way that few others have in recent times. That day 202 people were slaughtered, three of whom were New Zealanders. Yet I suspect that in the intervening 2 years many of us will have let our memories slip a little, and will be thinking: “Is it really as long ago as 2 years?”. In that time we have had the outrages at Madrid, Beslan, and, more recently, Jakarta; almost weekly we have had the parade of suicide bombers on the West Bank, and elsewhere; and now, in the last few weeks, we have seen a new explosion of terror that reached its nadir with the decapitation of Kenneth Bigley last week. Terrorism, unfortunately, has become a way of life for far too many, and its impacts now extend to all of us, wherever we are, whatever our occupation, our walk of life, or our particular reason for being in a place at the time an attack occurs.

To that extent, the awful tragedy is that the terrorists have already won the first part of their battle: they have destabilised all of us; they have placed all of us at risk and on notice. Although I strongly support the sentiment that we must regroup and do all we can as civilised people to stop the scourge of terrorism, we have to do so in a way that restores a sense of confidence to our own people, and all people around the world, that we are in fact capable of doing so. The awful tragedy of the last few years has been that despite the rhetoric, despite the concerted international action, and despite the specific actions in particular places, the terrorists still peddle their awful trade. While today we should commemorate those who suffered and those who suffered loss, we should also remind ourselves of the fact that as yet we have not found a way to stop this scourge, and we do need to redouble our international efforts to do so, otherwise this debate this afternoon will be one of many we will have, sadly, in the future.

Hon MATT ROBSON (Deputy Leader—Progressive): The Progressive Party also supports the motion that is before the House. We stand with the people of the world who were shocked by what occurred in Bali. We remember also that the people of Bali suffered in 1965 and 1966 when the worst killing grounds of all, after the overthrow of President Sukarno, were in Bali, and the streets ran with the blood of the people of Indonesia.

The fight against terrorism is on a number of levels. It is a fight against those who are criminal gangs and individual groups, and it is a fight against those States that support, foster, and fund terrorism. I believe that the people of New Zealand are looking for us to continue our support for the international rule of law in the fight against terrorism and to make sure that our own domestic laws are in accord with the rule of law. The only way that the world will be able to end these criminal attacks, which in the end mean the suffering of ordinary people, is to take an approach that deals with the causes of terrorism and to look particularly at fostering development in that great part of the world—where the great majority of the people live on under $2 a day—and to make sure that world attention is focused on such tragedies as that of the Palestinian people, what is happening in Sudan, and in all those parts of the world where ordinary people, through no fault of their own, are the victims of greater forces.

The Progressive Party sees that this motion is an important motion for this House to support in unanimity.

Motion agreed to.

Questions for Oral Answer

Questions to Ministers

Working for Families Package—Child Poverty

1. SUE BRADFORD (Green) to the Minister of Finance: Does he have any plans to bring forward or increase his Working for Families package in light of the Public Health Advisory Committee’s findings on child poverty; if not, why not?

Hon Dr MICHAEL CULLEN (Minister of Finance): No, the package is already expected to achieve the goal set by the Public Health Advisory Committee.

Sue Bradford: Does the Minister agree that reducing child poverty by 30 percent makes long-term economic sense as well as being an important social policy goal; if so, when will he bring forward the Budget provision for the full Working for Families package so that our poorest children get the benefit of a record Government surplus a lot sooner than 4 years?

Hon Dr MICHAEL CULLEN: The goal was to reduce child poverty by 30 percent by 2007. The committee reports that, even on the stricter measure, that is what the package will achieve. On the looser measure the reduction will be 70 percent.

Hon Mark Gosche: On what assumptions is the estimate of a 30 percent reduction in child poverty based?

Hon Dr MICHAEL CULLEN: There are two measures of family poverty widely accepted internationally: one sets the threshold at less than 60 percent of the medium wage after housing costs and the other puts it at 50 percent. The 30 percent reduction estimate is based on the tougher 60 percent measure. Using the lower 50 percent measure the Working for Families package is expected to achieve a 70 percent reduction in child poverty.

John Key: If one of the goals of the Working for Families package was to make work pay, why are working families having to wait until 2006 before they get their in-work payment?

Hon Dr MICHAEL CULLEN: Apart from anything else, there was certainly clear advice from officials that there was a serious risk of system failure if it was attempted to be introduced from 1 April 2005. This side of the House does not stand for system failure.

Paul Adams: Has the Minister given serious consideration to other plans to tackle child poverty, such as United Future’s proposal released in April this year to establish one-stop shop family support centres, which would coordinate referrals for families to local health, budget, income support, early childhood, and parenting services, given that the Government has adopted other aspects of United Future’s proposal, and that similar centres operate successfully overseas; if not, why not?

Hon Dr MICHAEL CULLEN: Obviously, that is outside my area of responsibility; it is more in the area of responsibility of Mr Maharey as Minister for Social Development and Employment. We will always consider carefully good suggestions from United Future and good suggestions from the Greens, and even good suggestions from New Zealand First. Sadly, we never get any from either ACT or National.

Sue Bradford: When will the Government give priority to lifting the minimum wage to at least $12 an hour so that the burden of supporting families does not lie so much with the taxpayer?

Hon Dr MICHAEL CULLEN: The Government has already substantially lifted the minimum wage in New Zealand. It will continue to move it up on an annual basis, but excessively large increases in one jump would threaten the potential for an increase in unemployment.

Hon Mark Gosche: When will the Working for Families package be fully in place?

Hon Dr MICHAEL CULLEN: Because of its comprehensiveness, the package is being phased in over 3 years. The first elements came into force a few days ago on 1 October. Full completion will occur on 1 April 2007, with ongoing adjustments thereafter.

Paul Adams: Has the Minister given serious consideration to other plans to tackle child poverty, such as allowing families to capitalise the assistance they receive from the Working for Families package to help them buy a house or repay their mortgage; if not, why not?

Hon Dr MICHAEL CULLEN: A range of options are being looked at for future further assistance to families.

Sue Bradford: When will the Government stop giving priority to its capital works programme over children’s health and, instead, allocate revenue to bring the Working for Families package forward by 2 years, and borrow for capital works, as every previous Government has done?

Hon Dr MICHAEL CULLEN: The Government is spending far more on health than it is spending on roads at the present time, and has been subject to some considerable criticism from some people in the past on that. The Government running strong surpluses is why the economy is running very strongly as well. A recent election suggests that parties that want to borrow their way into high interest rates will be punished by the electorate for that.

Sue Bradford: When will the Minister amend his Budget to provide for inflation adjustment for family support payments back to at least 1998 levels, as an obvious and immediate measure the Government could take to assist children in poorer families?

Hon Dr MICHAEL CULLEN: I would be very surprised if the increases that will come into force progressively on 1 April 2005, 1 April 2006, and 1 April 2007 do not do more than inflation adjust back to 1998. They will do considerably more than that, and inflation adjustment will occur thereafter, from 1 April 2008 onwards.

Inquiries—Resources

2. RON MARK (NZ First) to the Prime Minister: What is her Government’s policy on initiating, conducting, and funding inquiries?

Rt Hon HELEN CLARK (Prime Minister): The Government considers any possible inquiry on the basis of the circumstance and merits of each case.

Ron Mark: When she said on Breakfast yesterday in relation to the abuse claims at the Regular Force Cadet School: “You have very serious allegations ranging from murder to gang rape, to violent assault.”, was she aware that both I and MP Shane Ardern had brought the case of the Bain family and the shooting of their son, cadet Grant Bain, to the attention of her Minister of Defence in March 2002, who dismissed it by saying: “I am now satisfied that the matter has been dealt with as best it can be, given that it is some 21 years since the tragic accident occurred.”?

Rt Hon HELEN CLARK: Over the last couple of weeks, with the publicity from the gentleman in Western Australia, some 85 people have come forward to the office of the Minister of Defence to express an opinion about what happened at the cadet school, and I understand that the gentleman who initiated the publicity has probably received rather more contacts than that. That is cause, given the range of allegations, for the Government to take the step it took yesterday to move to set up an independent assessor.

John Carter: Why did it take massive media coverage before the Government was prepared to take action on this issue, when her Government was approached on this issue more than 2 years ago?

Rt Hon HELEN CLARK: I seem to recall some comment, I think from Marilyn Waring, who said that she took it up in her time as a Government member of Parliament under a National Government. If members want to direct questions to the Minister of Defence, they should do that, but, clearly, the range of allegations in public at the present time requires the matter to be taken further.

Ron Mark: Is it not a fact that allegations of abuse and ill-treatment of Regular Force cadets were made public on 7 October 1975, and that the Labour Government of that time saw no need for further investigations because the military had clearly stated that such things were not condoned, and that “the senior cadets responsible had been charged and punished”?

Rt Hon HELEN CLARK: I have not the slightest idea whether the matter was raised with the Government in 1975. It may well be that the Defence Force said, as the member alleged, that those things were not condoned. The point is that to some degree those things appear to have happened, and now a great many people have come forward to express concern about the matter. That is why an independent assessor should be appointed to look at it.

Ron Mark: Can the Prime Minister not understand the scepticism of people like the Bain family when it comes to her Government’s reluctance to move on some inquiries but seeming haste to move on others, so aptly summed up by Tony Ellis, who said: “You complain to the ombudsman, he complains to Parliament that he cannot get a prompt and impartial investigation, you go to the chief district court judge, he says he is not resourced, you then go to the High Court that takes months. If it’s soldiers at Waiouru you instantly get an inquiry, but if it’s prisoners you can’t get anyone to do anything.”; does that not sum up this Government’s approach to independent inquiries?

Rt Hon HELEN CLARK: The member will be well aware in respect of prisons that the Government, at some expense, is inquiring into the alleged behaviour of the “goon squad” at the prison in Christchurch. The Government will respond when it sees it as being appropriate and in the public interest.

Peter Brown: Noting the Prime Minister’s answer to the principal question, how does she suggest an inquiry is obtained into the Sydney Express - Maria Luisa mishap—the shipping collision inside Wellington Harbour limits where five men died, their families were denied an inquest or any formal public hearing, the Transport Accident Investigation Commission and the Marine Safety Authority colluded inasmuch as evidence was passed secretly from one to the other, and thus far it has not been made available to anyone else; how does the Prime Minister suggest we get a formal inquiry into that mishap, and will she support such an inquiry?

Mr SPEAKER: There were three questions there. Two can be commented on.

Rt Hon HELEN CLARK: I will add that to the list I already have of the six formal inquiries New Zealand First has called for in the past year.

Ron Mark: Can the Prime Minister enlighten the House as to why her Government, if it is so concerned about charges and allegations of sexual abuse, has not agreed to the ACT MP Deborah Coddington’s call for an inquiry into abuses at health camps, which she has had all of the details of for quite sometime.

Rt Hon HELEN CLARK: I cannot say that I am aware myself of such a request. If the member would like to forward the information she has to the Government, it can be considered.

Te Arawa—Rotorua Lake Beds

3. Dr DON BRASH (Leader of the Opposition) to the Prime Minister: Does she stand by her reported statement that the Te Arawa offer sets a precedent for a new style of settlement; if not, why not?

Rt Hon HELEN CLARK (Prime Minister): Most certainly. It excludes rights to water columns and airspace, as the National Government failed to do with the Ngāti Tūwharetoa settlement.

Dr Don Brash: Can the Prime Minister confirm that an agreement was signed between Te Arawa and the Crown in 1922, as a consequence of which Parliament legislated for a settlement that was intended to be full and final; if so, can she tell the House why the Government now wishes to transfer title to the lake beds to Te Arawa at the very same time that it is promoting legislation to put the seabed and foreshore into Crown ownership?

Rt Hon HELEN CLARK: The Leader of the Opposition has tripped himself up in saying that one part of the full and final settlement should be able to opened up—that is, the money—but not the other bit, which is the title to the lake. Te Arawa have asserted that they never ceded ownership of the lakes. The Crown has always asserted that they were always Crown owned. In the end there has been a negotiation that is entirely consistent with the policy of a previous National Government.

Metiria Turei: Does the Prime Minister agree that title to the lakes is symbolic only as Te Arawa will be only part of a local management committee, unlike other property owners with title, and has she received any reports from the leader of the National Party to support all private landholders being subject to joint management regimes; or is this one law for Māori property owners, and another for general landowners?

Mr SPEAKER: The first part of the question is in order.

Rt Hon HELEN CLARK: No, I would not accept that this is an entirely symbolic settlement, but what I would strongly reject is the assertion from the Leader of the Opposition that significant statutory powers have been transferred. The statutory power is to recommend to the Minister of Fisheries that commercial species be added to the list.

Hon Ken Shirley: Could the Prime Minister please explain clearly to the House, and to the country, why her Government believes that it is important for the coastal foreshore and seabed to be held in public ownership, yet the foreshore and lake bed of the iconic Rotorua lakes should be removed from public ownership by her Government?

Rt Hon HELEN CLARK: It is one thing to let a Court of Appeal decision stand that would see freehold title extended by the Māori Land Court into private property; it is another to freely negotiate full public access and rights in a negotiated treaty settlement.

Hon Ken Shirley: I raise a point of order, Mr Speaker. I think it is obvious to everyone on both sides of the House that that did not even attempt to answer the question and explain the difference between the two policies—why the coastal foreshore and seabed must be in public ownership, yet the iconic Rotorua lakes must be taken out of public ownership.

Mr SPEAKER: No, I thought the Prime Minister addressed the question.

Hon Peter Dunne: If the 1922 settlement was a full and final one, why is another settlement being embarked upon now, and what safeguards will be included in that to prevent another settlement being sought in another 82 years’ time?

Rt Hon HELEN CLARK: One cannot say what future generations of New Zealand Governments may negotiate—that is obvious—but I do not think there will be anybody who would think, after looking at the 1922 settlement, that the outcome is fair to Te Arawa today.

Dr Don Brash: Why has the Government responded to Te Arawa’s concern about the lack of an escalator clause in the annuity agreed to in 1922 by offering both a monetary settlement of $10 million, and the transfer of title to the lake beds, in sharp contrast with the legislation before the House to ensure the seabed and foreshore remain in Crown ownership?

Rt Hon HELEN CLARK: The Leader of the Opposition has claimed that Arawa never asked for the title to the lakes. That is completely untrue. Its statement of claim actually included that and, consistent with the previous National Government’s policy of transferring title, the Government has proceeded to negotiate a settlement. What we can say—[Interruption] Well, he could not cope with the paperwork. What we can say is that this settlement is tied down in a way that the National Government utterly failed to do.

Metiria Turei: Has the Prime Minister received any reports or requests from the Leader of the Opposition regarding Crown ownership of all private title to the foreshore, given his reported statement in Rotorua that “Today we are sending a clear message that the lakes and the foreshore should belong to everyone.”; or is this again a position of one law for Māori and another for private title holders?

Mr SPEAKER: The first part of the question may be answered.

Rt Hon HELEN CLARK: No. The Leader of the Opposition seems very determined to protect Pākehā property rights.

Dr Don Brash: I raise a point of order, Mr Speaker. That question clearly misrepresented what I said yesterday in Rotorua. I said that the lakes, seabed, and foreshore should be in Crown ownership except where prior freehold title exists, whether that be Māori or non-Māori.

Mr SPEAKER: The member has made his point of view, and his word will be accepted.

Dr Don Brash: Can the Prime Minister confirm a report that the Government’s offer to transfer title to the Rotorua lake beds to Te Arawa was made with no prior negotiation, and that the Te Arawa Māori Trust Board chairman had “very real concerns” about the sudden offer; if so, why was that part of the settlement pursued, when it was not even originally part of what was being negotiated between the Crown and Te Arawa?

Rt Hon HELEN CLARK: Te Arawa’s statement of claim on 19 March 2001 set out as a key principle for settlement getting title to the lake beds. [Interruption]

Mr SPEAKER: There are people on both sides of the House who run the risk of an early question-time departure.

Question No. 2 to Minister

RON MARK (NZ First): I should have done this earlier. I seek the leave of the House to table a letter from myself to the Minister of Defence, Mark Burton, dated 22 March 2002, relating to the Bain shooting.

Document, by leave, laid on the Table of the House.

RON MARK: I seek leave to table a letter dated 20 May, which is a response from the Minister of Defence, Mr Burton, to myself, relating to the same matter.

Document, by leave, laid on the Table of the House.

International Monetary Fund—Washington Meeting

4. CLAYTON COSGROVE (Labour—Waimakariri) to the Minister of Finance: What were the main items for discussion at the International Monetary Fund meeting he attended in Washington last week?

Hon Dr MICHAEL CULLEN (Minister of Finance): Discussion focused on the world economic outlook, aid issues, and the policies required to encourage development in poorer countries.

Clayton Cosgrove: What information did New Zealand have to offer to those discussions?

Hon Dr MICHAEL CULLEN: A great deal. Much discussion centred on the reforms required to meet the criteria dealt with in the World Bank report Doing Business in 2005, which was referred to by many delegates. New Zealand ranked first overall in that report in terms of ease of doing business, which put us in a very good position at the IMF - World Bank meeting, particularly at the development committee meeting.

John Key: What does the Minister consider to be the bigger blunder he made when he gave his Dow Jones interview last week at the IMF: blurting out the fact that he thinks interest rates will go to 9 percent, or bagging off shore the Reserve Bank governor for his interest rate management policy here in New Zealand?

Hon Dr MICHAEL CULLEN: There were no mistakes at all. I simply pointed out something that apparently is news to the Opposition, because this Opposition spokesperson on finance is not yet old enough to read the Reserve Bank report. If he had read it, it would have told him that the Reserve Bank is projecting two further interest rate rises this year.

Mr SPEAKER: I must say the interjections get banal occasionally.

Gordon Copeland: Did the IMF discuss the impact of crude oil prices of over US$50 per barrel on the world economy, and how does the Minister see those developments impacting on the New Zealand economy?

Hon Dr MICHAEL CULLEN: Yes, obviously the oil situation was very much to the fore. The IMF, I think, has already basically wound back its world economic growth forecast by about 0.5 percent as a consequence of the oil price increases. The effects on New Zealand are likely to be largely second-round effects because of the impact on other major economies. In part, while the present high exchange rate is not good for some parts of the economy, it is muting the effect of the oil price increases on New Zealand.

John Key: I seek leave to table the Reserve Bank’s Monetary Policy Statement, which clearly shows that interest rates will not be going up three times.

Document not tabled.

Hon Dr MICHAEL CULLEN: I seek leave to table the statement in which I said that interest rates would certainly rise once more this year, and possibly once or twice more after that. I think that makes two or three times, does it not?

Document, by leave, laid on the Table of the House.

Te Arawa—Rotorua Lake Beds

5. GERRY BROWNLEE (Deputy Leader—National) to the Minister in charge of Treaty of Waitangi Negotiations: Why did the Government make the offer to transfer title of Rotorua lake beds to Te Arawa in 2001, when the matter of lake bed ownership was dealt with in 1922 and the chairman of Te Arawa Māori Trust Board reportedly said the iwi had not even begun negotiations about the lakes’ ownership when the offer suddenly arrived on his desk?

Hon MARGARET WILSON (Minister in charge of Treaty of Waitangi Negotiations): The Government decided to continue the negotiations begun by National. Those grievances included not only the 1922 agreement; it was not confined to that agreement. It was larger than just the issue relating to that agreement. From the outset of the negotiations Te Arawa negotiators have sought the return of the lake beds. They cited as precedents for that return of the lake beds the Ngāi Tahu settlement and also the Tūwharetoa Lake Taupō settlements. It is apparent from National members and Ministers’ correspondence in the early 1990s that the return of the lake beds was an option. Unfortunately, I have been unable to verify the statement by the former chair of the Te Arawa Māori Trust Board.

Gerry Brownlee: When the Minister decided to offer the lake beds of the 13 Rotorua lakes back to Te Arawa, could she cite any occasion where a lake given back to Māori had previously been sold in an honourable agreement?

Hon MARGARET WILSON: I think there is a misapprehension about the 1922 agreement. There was no exchange between the Crown and Te Arawa for the lake beds going into Crown ownership. The Crown had always asserted that it owned those lakes. That had been contested by Te Arawa, and continued to be contested, but because Te Arawa did not have any ability to influence the Crown’s legislation, it came to a negotiated settlement at that time. That is why there has always been a sense of genuine grievance that it was not an agreement done with the utmost good faith that one would require from a treaty partner.

Gerry Brownlee: I raise a point of order, Mr Speaker. The Minister appears not to have heard my question.

Mr SPEAKER: That is the one and only warning. I want the point of order raised, because it had better be a point of order.

Gerry Brownlee: It is. I asked whether, at the time of offering the lakes back to Te Arawa, the Minister was able to cite any other example where a lake was handed back to Māori where there had been a sale. The Minister dodged that question.

Hon Dr Michael Cullen: The Minister gave a full and comprehensive answer, which pointed out that the assumption of the question was wrong. There was no sale.

Mr SPEAKER: Did the Minister want to comment?

Hon MARGARET WILSON: No. That was the point I was to make.

Steve Chadwick: Which party established the precedent for returning lake beds to Māori?

Hon MARGARET WILSON: National did. It established the precedent in 1992 with Lake Taupō, and consolidated that precedent with Ngāi Tahu in 1998. That is why in the following year, 1999, Te Arawa knew that the National Government of the day was happy to return the lakes to them. National has now obviously changed its policy—another example of the flip-flop by Dr Brash.

Mr SPEAKER: I just want to say to one member of the House that the interjection he made, which referred to his own colleagues, was grossly offensive. I will not repeat it.

Gerry Brownlee: When the Minister was giving the House her little lesson before, on her opinion about the proposed sale, was she aware that the sale actually took place after some 8 years of negotiation, and that none other than Sir Apirana Ngata was one of the Government negotiators; and how is it then that she is able to say that even though a sale was historically concluded, there was no sale?

Hon MARGARET WILSON: Because there was no sale. If one reads the record at the time, one can see that it was a classic case whereby one party to the negotiation had considerable power, to the detriment of the other party. All the record shows that, and that is why there has been a sense of grievance in Te Arawa ever since. Members should not forget that, as I am sure the honourable member knows, Te Arawa was a tribe loyal to the Crown.

Stephen Franks: What kinds of airspace rights were on offer to Te Arawa as recently, it appears, as last Christmas; and exactly how soon after Dr Brash’s Ōrewa speech did the Minister whisk airspace rights off the negotiating table?

Hon MARGARET WILSON: Airspace rights have never been on the negotiating table, and that is why one of the initial offers that was made was rejected by Te Arawa, who wanted that to be in the agreement.

Gerry Brownlee: If, after 8 years of negotiations, there was no sale in 1922, what on earth has the Government been paying an annuity for, for the past 82 years?

Hon MARGARET WILSON: The annuity, in effect, was paid not to pursue a legal action.

Gerry Brownlee: I seek leave for the House to grant the Minister—and I think we can do it that way—the opportunity to explain that. As far as we understand, at the time $2,000 was paid to sort out those legal matters, not the annuity.

Mr SPEAKER: No, no, the member knows he cannot seek leave on behalf of another person.

Stephen Franks: I seek leave to table a communication from Te Arawa leadership to members, recording the offer of airspace rights shortly before Christmas last year.

Document, by leave, laid on the Table of the House.

Working Holiday Schemes—Scope

6. MARTIN GALLAGHER (Labour—Hamilton West) to the Minister of Foreign Affairs and Trade: What steps has New Zealand taken to extend the scope of working holiday schemes for New Zealanders travelling overseas and for young overseas visitors coming to New Zealand?

Hon PHIL GOFF (Minister of Foreign Affairs and Trade): Today the Czech Republic becomes the 23rd country with which New Zealand has signed a working holiday agreement. That brings to 27,800 the number of places available to young New Zealanders to work and holiday overseas, and there are a similar number of places here for young overseas visitors. Because of the success of the schemes and the demand for places, New Zealand has also recently increased the quota for Germany by 700, for France by 400, and for Sweden and the Netherlands by 200 each.

Martin Gallagher: What are the advantages to New Zealand of negotiating such agreements?

Hon PHIL GOFF: There are two direct benefits. Research that has been done by the Department of Labour shows that working holiday schemes actually create additional jobs, rather than displacing local workers, and also meet the demand for seasonable labour, which employers have been having trouble finding. They also, of course, provide opportunities for young New Zealanders to live and work overseas. The indirect benefit is perhaps the best benefit—that is, to strengthen our people-to-people linkages internationally, and to build awareness and a positive image of New Zealand overseas.

Te A—Rotorua Lake Beds

rawa

7. SIMON POWER (National—Rangitikei) to the Minister of Conservation: Does he agree with the view of his department that aspects of the settlement offer to Te Arawa do not “advance special circumstances that are sufficient to justify an exception to principles or confine the precedent risk”; if not, why not?

Hon CHRIS CARTER (Minister of Conservation): Last year a number of agencies expressed concern about the effect this handover would have on the autonomy of local government. That concern has been addressed in the current deed and agreement with the relevant local government agencies.

Simon Power: Has the Minister received any advice from his department that would confirm that the Te Arawa settlement is full and final; if so, why is this any different from the full and final settlement of 1922?

Hon CHRIS CARTER: The advice that I receive from my department pertains to biodiversity protection, access, and recreational opportunities, and my department has been fulsome in its advice on those issues.

Hon Ken Shirley: Is the Minister alarmed that the condition of unrestricted access for all recreational activities and scientific research, at no fee, in Lake Taupō has been seriously breached with Tūwharetoa denying access for the Crown research Institute of Geological and Nuclear Sciences to conduct volcanological surveys in Lake Taupō using a mini-submarine, and how can we be assured that Te Arawa will not similarly obstruct access or demand payment for critical limnological studies in the Rotorua lakes?

Hon CHRIS CARTER: I am confident that the agreement on the Te Arawa lakes will ensure public access and the welfare of those unique and iconic sites.

David Parker: Has the Minister seen any reports on the parallels between the Te Arawa settlement and the previous treaty settlement with Ngāi Tahu?

Hon CHRIS CARTER: Yes. I have seen a report that the Leader of the Opposition says that he cannot be held responsible for the treaty settlements negotiated by previous National Governments. I must say that it is a sad day when National turns its back on the significant contribution made by Sir Doug Graham in negotiating the settlement of one of the country’s largest treaty claims.

Mr SPEAKER: The member has no responsibility in that area.

Tariana Turia: Will the Crown, through the Department of Conservation, honour the undertaking given in 1880 to maintain the lakes in their pristine state for the use of the nation and tourists alike, given the conditions of those lakes today; or is Te Arawa expected to use its $10 million to return the lakes to that state?

Hon CHRIS CARTER: The Government will continue to work with Te Arawa to restore the health of those waterways.

Simon Power: Can the Minister confirm that he has received advice from his department stating that “a decision on this proposal should follow the more detailed policy consideration that is taking place with respect to foreshore and seabed decisions”; if so, will he follow his department’s advice?

Hon CHRIS CARTER: I can confirm that I received that advice, but at a much earlier date. Since then we have moved on in addressing those issues.

Simon Power: Can the Minister confirm, in relation to Tūwharetoa, that it was accepted that the lake was confiscated rather than acquired through legal means, unlike the Te Arawa deed in 1922 where a contract was entered into; if so, is this Minister now telling the House that the Government would embark on treaty settlements regardless of whether a treaty grievance existed?

Hon CHRIS CARTER: I can neither confim nor deny, as I am not the Minister in charge of Treaty of Waitangi Negotiations. But I can confirm that I will be working hard to protect the biodiversity and recreational opportunities of those lakes.

Simon Power: I raise a point of order, Mr Speaker. In a newspaper article dated 7 October a spokesperson for the Minister of Conservation, Chris Carter, described the Minister as being “the Minister in charge of the negotiations relating to Tūwharetoa”.

Mr SPEAKER: That may well be the case, and I accept that what the member said is correct, but that in no way goes past the point that the Minister addressed the question.

Small Business—Confidence, Wellington

8. LUAMANUVAO WINNIE LABAN (Labour—Mana) to the Minister for Small Business: What recent reports has he received on small-business confidence in the Wellington region?

Hon JOHN TAMIHERE (Minister for Small Business): In a recent survey of Wellington businesses, the Wellington Regional Chamber of Commerce found that 73 percent of small businesses—those with fewer than 5 employees—had a very positive outlook. Similarly, a recent BRC Marketing and Research business confidence survey found strong and growing confidence in the regional economy, and a clear and growing majority of respondents were satisfied with the Government’s handling of the economy.

Luamanuvao Winnie Laban: Did the BRC report see a decline in satisfaction among Wellington businesses on any of the variables surveyed?

Hon JOHN TAMIHERE: Yes, one of the few variables that saw a decline was satisfaction with Don Brash as Opposition finance spokesman. This is consistent with another poll I saw on Friday showing further disenchantment with the Leader of the Opposition. Clearly, Wellington business people are happy with the strong business performance of the economy under this Government, particularly under its excellent local MP, the Hon Marian Hobbs. The business people of Wellington are not looking for any mischief from any cast-offs from United Future.

Peter Brown: Is the Minister aware that many small-business people in Wellington and elsewhere are very nervous—very nervous indeed—about the Employment Relations Law Reform Bill, which has come before this House, and is he aware that some Government members have said that it will have no effect on those businesses; if he is aware of both those issues, will he support a Supplementary Order Paper exempting small businesses from the bill?

Mr SPEAKER: As far as the last part of the question is concerned, it is not really in order.

Hon JOHN TAMIHERE: No, I am not aware of that.

Question No. 4 to Minister

JOHN KEY (National—Helensville): I apologise for the delay in raising this matter. There seems to be a bit of confusion by the Minister of Finance about his own statement. I seek leave to table the Minister’s own statement to Dow Jones, where he quite clearly says that the Reserve Bank has indicated the near-certainty of one more move in interest rates, then one or two after that. I assume he agrees with me that one plus two equals three.

Mr SPEAKER: Leave is sought to table that statement.

Hon Dr Michael Cullen: The statement has already been tabled.

Mr SPEAKER: The statement has already been tabled, but the member has asked for leave, and I have put it. Is there any objection? There is.

Resource Management Act—Non-local Decision-making

9. Hon Dr NICK SMITH (National—Nelson) to the Associate Minister for the Environment: How does he reconcile his statement in the House last Thursday “I have never denied the existence of a list of major infrastructure projects” with his 20 September response to an Official Information Act request “I am advised that no specific list of major projects suitable for non-local decision making process has been part of the RMA review process. My office therefore holds no such list.”; an email from his office on 28 September “neither the Minister, nor the Ministry for the Environment holds a list of projects suitable for non-local decision making.”, and the 24 June 2004 Ministry for the Environment paper entitled “Package of Improvements to the Resource Management Act” of which page 11 entitled “Possible candidates for non-local decision making with the RMA” lists 38 projects?

Hon DAVID BENSON-POPE (Associate Minister for the Environment): Easily. The existence of potential projects does not mean that the Government has a particular view of them.

Hon Dr Nick Smith: I raise a point of order, Mr Speaker. My question asked how the Minister reconciles his various statements. It was not a question about how the projects might have been put together; it was about an Official Information Act request and a list.

Mr SPEAKER: The Minister answered that with the first word: “Easily.” He then went on to add a little extra. He did not have to add anything, if he did not want to.

Hon Dr Nick Smith: Can the Minister explain—noting that the only difference between the wording of the Official Information Act request and the actual document was that one referred to “possible projects” and the other to “suitable projects”—the difference between the words “possible” and “suitable” and how that justified his saying the document never existed?

Hon DAVID BENSON-POPE: I would like to help the member if I could, but it is not possible to characterise the request of the Royal Forest and Bird Protection Society in the way he would like. The society did not ask for a general list of projects or for a list of possible projects. Instead, it asked for a list of projects that the Government regarded as suitable for a particular Resource Management Act consent process, which I might add—[Interruption]

Mr SPEAKER: That is twice the member has interjected: firstly, in the second person, and, secondly, with a comment that was out of order. He will stand, withdraw, and apologise.

Gerry Brownlee: I withdraw and apologise.

Dr the Hon Lockwood Smith: We are entitled to interject.

Mr SPEAKER: I am asking the Minister to continue.

Dr the Hon Lockwood Smith: I am entitled to interject.

Mr SPEAKER: Well, you are entitled to interject, but you were wrong.

Hon DAVID BENSON-POPE: Such a list did not exist and does not exist.

Dave Hereora: What reports has the Minister seen about other proposals for large or complex projects under the Resource Management Act?

Hon DAVID BENSON-POPE: I have seen the following comment made by Mr Guy Salmon, a high-ranking National Party list candidate in 2002: “But efforts to curb people’s right to object, as floated by Nick Smith, National’s new environment spokesman, would cut across the grain of being a New Zealander and in practice would not make much difference to the cost and delays which business applicants face.” This is in response to National’s policy to fast track large projects—

Mr SPEAKER: At that point the Minister has gone far outside the question.

Hon Bill English: I raise a point of order, Mr Speaker. I am concerned that you allowed that question and answer to proceed. This is a very serious matter over a Minister having broken the law—that is, the Official Information Act—by retaining papers he knew to exist and then denying their existence; and he has been caught out. That is a very serious matter for this Parliament. It is not a matter to be trifled with, particularly from the Chair, by your allowing highly partisan supplementary questions that are out of order or bear no relationship to the primary question. I ask that you regard this matter as seriously as Parliament does.

Mr SPEAKER: I certainly regard every question asked in this Parliament as serious.

Hon Dr Nick Smith: Why did the Minister, in answer to my last supplementary question, say the Royal Forest and Bird Protection Society request for the information used the words “regarded by the Government”, when those words do not exist in the Official Information Act request? [Interruption]

Mr SPEAKER: The member will stand, withdraw, and apologise for that comment.

Hon Bill English: I withdraw and apologise. I raise a point of order, Mr Speaker. We have a case here where the Minister appears to have broken the law, and continues to offer statements that directly contradict the facts. You cannot expect members to sit here listening to a discussion about legislation that the House passed—the Official Information Act, which is a vital tool for the Opposition, where Parliament is the only place where we can exercise real accountability for how that Act has been used—when a Minister of the Crown makes statements that directly contradict the facts that have been presented about a dozen times in this House in the last two question times. In that context, I think you could show some forbearance for members feeling motivated about it and interjecting.

Mr SPEAKER: I do not mind members interjecting, but they will not make the comments that the member made. As a senior member he knows that he cannot make those comments. The member did not even wait for the Minister to reply.

Hon Dr Nick Smith: I will re-ask the question, because the Minister did not have the answer.

Mr SPEAKER: The question has been answered.

Hon Dr Nick Smith: It is an important question.

Mr SPEAKER: I think that is fair enough. The member may re-ask the question.

Hon Dr Nick Smith: In his last response why did the Minister say that the Royal Forest and Bird Protection Society request included the words “Government regarded”, when no such words exist in that request?

Hon DAVID BENSON-POPE: My office complied accurately with the Royal Forest and Bird Protection Society request under the Official Information Act. Its request was for a list of projects that the Government deemed suitable for non local decision-making. The ministry has never assessed any list of infrastructure projects for their suitability or non-suitability for any particular Resource Management Act process, existing or imagined. For this reason I correctly advised the society that my office had no such list.

Hon Dr Nick Smith: I raise a point of order, Mr Speaker. My question was very specific. When the Minister said the reason for him not accepting the request under the Official Information Act was that it included the words “Government regarded”. My question was very simple: why did the Minister say that was the reason when the written request under the Official Information Act never used those words? I simply ask the Minister to answer my question.

Mr SPEAKER: I thought the Minister was endeavouring to do that and the member interrupted him with a point of order. I will hear the Minister’s final part of his answer.

Hon DAVID BENSON-POPE: I had finished my answer.

Hon Dr Nick Smith: I raise a point of order, Mr Speaker. My question was very specific. I asked why he told the House that the words “regarded by the Government” were in the request under the Official Information Act when they were not. I do not think the House has received any explanation as to why he said that when it does not exist.

Mr SPEAKER: An interjection was made over the top of the Minister’s final answer. Perhaps the Minister might like to give that final sentence of his answer where I thought he had addressed the question.

Hon DAVID BENSON-POPE: The ministry has never assessed any list of infrastructure projects for their suitability or non-suitability for any particular processes under the Resource Management Act. For this reason the Royal Forest and Bird Protection Society was correctly advised that my office held no such list, because, I tell Dr Smith, no such list exists.

Hon Dr Nick Smith: Why does the Minister again say in this House that no such list existed, and say in an email that no such list existed within the Ministry for the Environment, when I have in my hand a letter with the Ministry for the Environment letterhead, dated 24 June, that contains, very specifically, a list of those projects under the title “Possible candidates for non local decision-making under the RMA”?

Hon DAVID BENSON-POPE: The member will recall that I answered that question quite specifically last Thursday, and I will repeat that answer for him. “I am advised that a list entitled ‘Possible candidates for non local decision-making under the RMA’ ” has never been discussed by Cabinet. I was further advised that “a list with that title, which had been compiled by the Ministry of Economic Development for other purposes, was erroneously included” in a draft Resource Management Act discussion paper while that paper was being written. I was also advised that “it was removed from the draft document because, in the view of the ministry, it was misleading as to the Government’s view”—which it does not hold—“about any of these projects.”

Hon Dr Nick Smith: Does the Minister recall the statement made by former Minister Lianne Dalziel when she resigned and he replaced her, in which she said: “The standard for a Minister is the truth, the whole truth, and nothing but the truth”; if so, does he believe his initial denying that the document existed, and then last week denying that he ever had denied the document existed, fits with the standard set by Lianne Dalziel?

Hon DAVID BENSON-POPE: There is no inconsistency in the statements that I have made.

Hon Dr Nick Smith: I seek the leave of the House to table the original Royal Forest and Bird Protection Society request under the Official Information Act for the documents, and particularly the list that was part of the officials’ paper on the Resource Management Act review.

Document, by leave, laid on the Table of the House.

Hon Dr Nick Smith: I seek the leave of the House to table the written response from the Minister saying that the document did not exist.

Document, by leave, laid on the Table of the House.

Hon Dr Nick Smith: I seek the leave of the House to table the email from the Minister’s office stating that the document did not exist and that the ministry did not have it, either.

Document, by leave, laid on the Table of the House.

Hon Dr Nick Smith: I also seek leave of the House to table the actual paper—the Ministry for the Environment paper of 24 June 2004—that includes the list of 38 projects.

Document, by leave, laid on the Table of the House.

Hon DAVID BENSON-POPE: I seek leave of the House to table a National Party news release from Guy Salmon criticising Dr Smith.

Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is.

Hon Bill English: I raise a point of order, Mr Speaker. In the process of that exchange I think it appeared to everyone who was listening that the Minister misled the House—and it is open to debate whether that was deliberate or accidental. In answer to one question he said that the request under the Official Information Act included specific words. Another member of the House quoted the request under the Official Information Act, which did not include those words. That is a pretty obvious case of the House being misled or the Minister being mistaken. He has the capacity under the Standing Orders to correct that now or as soon as he is aware that he has misled the House, and I invite him to do so.

Hon Dr Michael Cullen: Firstly, a member cannot raise by way of a point of order a charge of misleading the House. If the member wants to bring a breach of privilege claim, then he can. Secondly, I suggest that the Opposition is getting its knickers in a total twist over something quite simple as a synonym—deemed suitable and regarded suitable. If that is to be standard that is all very well, but we will apply that with great pleasure to the National Party and its policy utterances.

Mr SPEAKER: In the first sentence of the member’s point of order he said that it may open something to debate. It may well do so. There are ways in which I can be advised of particular discrepancies, and those can be followed.

Hon Dr Nick Smith: I raise a point of order, Mr Speaker. The Deputy Prime Minister has again asserted that the request under the Official Information Act included the word “regarding”. I seek the leave of the House to read the request so the House can be clear.

Mr SPEAKER: Leave is sought to read that document. Is there any objection? There is.

Railways—East Coast Main Trunk Line

10. PETER BROWN (Deputy Leader—NZ First) to the Minister for Transport Safety: Is he satisfied that the East Coast main trunk line carrying tonnage to and from the Port of Tauranga is safe; if so, why?

Hon HARRY DUYNHOVEN (Minister for Transport Safety): Based on advice from the Land Transport Safety Authority, I am satisfied that the East Coast main trunk line carrying tonnage to and from the Port of Tauranga is safe.

Peter Brown: Is he concerned that for at least a segment of that track, which runs alongside and between rows of housing, the bolts holding the lines in place can literally be plucked out with no resistance whatsoever, and if he is concerned, will he inform the House when such matters will be rectified?

Hon HARRY DUYNHOVEN: When the member raised this issue with me last Friday night I was immediately in contact with officials, who were in contact with New Zealand Railways Corporation. I believe they went out the very next morning to inspect the track in the area concerned, and could not find evidence of the fault outlined by Mr Brown. I regret that there was no evidence of that fault. They did find loose bolts from previous track work that had been replaced.

Peter Brown: I know that this is a bit unusual, but I would like to table photographs—

Mr SPEAKER: Table them at the end of the question.

Peter Brown: I think they will alert the Minister to what this is all about. The photographs are of a rather distinguished-looking gentleman and some gentlemen holding a bolt plucked from the track.

Documents, by leave, laid on the Table of the House.

Moana Mackey: How often is the safety of the line assessed?

Hon HARRY DUYNHOVEN: The Land Transport Safety Authority advises me that track maintenance gangs patrol the section of track regularly, as they do with other parts of the network. As I outlined last week, the Land Transport Safety Authority became aware of the safety concerns, and after discussion with the New Zealand Railways Corporation, it is satisfied that the East Coast main trunk railway line is being managed satisfactorily by the corporation. The authority has raised safety concerns regarding loose bolts on the East Coast main trunk line with the New Zealand Railways Corporation, which immediately arranged for its track maintenance contractors, Transfield, to undertake a special track inspection. I repeat that they found no evidence of safety problems.

Peter Brown: In light of the fact that I contacted the Minister and advised him of this and I got a telephone call back from his office, why did not somebody contact me again and I would have taken him or her out there to see a whole segment of a railway track with loose bolts?

Hon HARRY DUYNHOVEN: I regret that that did not occur. It is precisely what I asked to happen.

Peter Brown: If my assertions are correct, will the Minister check again whether I am correct, and if so, will he consider giving instructions to reduce traffic, or reduce speed, or both, in order that that line does not result in some sort of calamity?

Hon HARRY DUYNHOVEN: I thank the member for that suggestion. I do not have the power to do that, but the director of the Land Transport Safety Authority does. Should it be that following the inspection something of consequence has been missed, then obviously the director will take the appropriate action. I tell the member that I regret that my suggestion that officials be in contact with him and he show them the exact point was not followed up. I am not sure whether they attempted to do that. I did give the officials the telephone numbers, etc., for contact.

India—Prime Minister's Comments

11. RODNEY HIDE (Leader—ACT) to the Prime Minister: Does she stand by her reported statements in the Hindustan Times that “There has been many a time during my tenure that there has been a danger of nuclear conflict between India and Pakistan but the resolution of the nuclear issue lies in the resolution of the Kashmir issue, I think Kashmir is the flashpoint,” and that Kashmir is “a conflict driving point, and that has really put pressures on India and Pakistan to go nuclear,”; if not, what parts are not correct?

Rt Hon HELEN CLARK (Prime Minister): Those statements are distortions of my comments. Virtually every quote attributed to me in that article is a misquote, and the journalist made another four inaccurate statements in his radio interview this morning. I have released the transcript of my actual comments.

Rodney Hide: Why did she think it appropriate to comment on India’s internal politics ahead of her bridge-mending visit, and, in light of the reaction, is she sorry that she ever said: “Kashmir is the flashpoint” in respect of India and Pakistan’s proliferation of nuclear weapons?

Rt Hon HELEN CLARK: It is perfectly obvious to the whole world that Kashmir is a flashpoint for tensions between the two countries. Most countries do not regard it as simply an internal affair.

Keith Locke: Would the Prime Minister agree that Kashmir is a potential nuclear flashpoint, given that during the 2001-02 crisis in Kashmir several Pakistani officials threatened the use of nuclear weapons to deter a conventional invasion from India, and given that on 18 June 2002 the Pakistan President himself said that Pakistan’s possession of nuclear weapons did deter an invasion, and that nuclear deterrence had worked?

Rt Hon HELEN CLARK: The kinds of statements that the member is quoting only go to prove that there has been considerable tension around these issues between the two countries. New Zealand has not taken one side or another, and has constantly urged them to negotiate.

Dail Jones: Will the Prime Minister ensure during this bridge-building visit to South Asia that she has regard to the direction of the joint statement issued in New York after Dr Manmohan Singh, the Prime Minister of India, and General Pervez Musharraf, the Pakistan President, had met, which stated that the two leaders had addressed the issue of Jammu and Kashmir and had agreed that possible options for a peaceful, negotiated settlement of the issue should be explored in a sincere spirit and purposeful manner, and also other expressions in Pakistan and India that this type of issue should really be kept out of the media?

Rt Hon HELEN CLARK: Yes, I agree with the member that there have been very encouraging developments between the Governments of the two countries, and I am sure that all countries would want to support those developments.

Hon Peter Dunne: Has the Prime Minister received any advice from the New Zealand High Commission in India about the impact of her statements, in the light of the suggestion made by the journalist this morning that her statements would have some negative impact on her visit; if so, can she reassure the House that, in fact, her visit is likely to proceed in an air of calm and reason?

Rt Hon HELEN CLARK: Yes. The High Commissioner for New Zealand in India has been in touch with the Indian Foreign Ministry. It is understanding of the situation. It has the transcript and it has my statement, and I think it can see where the problem arose.

Rodney Hide: Does she understand the potential for concern about her statement, in light of her declaring in a press release on 12 May 1998 that India’s objections to the non-proliferation treaty were “at the least, insincere, and, at the most, extremely devious and misleading”; and does she stand by that statement she made back then?

Rt Hon HELEN CLARK: Not only I myself but New Zealand Governments down through the ages have urged all countries to sign up to nuclear disarmament treaties, and there is nothing I will resile from about that.

Rodney Hide: In light of her trip to India to build bridges, would she think it wise for a Prime Minister who was coming to New Zealand to observe, say, that the Foreshore and Seabed Bill was a flashpoint for race relations in New Zealand; and does she not think it wise not to comment on sensitive internal matters, no matter how certain she is about her particular views?

Rt Hon HELEN CLARK: The member may believe that Kashmir is an internal issue; most countries see it as a matter that has to be resolved between two countries.

Rodney Hide: I seek leave to table a press statement given by the Rt Hon Helen Clark declaring India to be insincere and potentially devious and misleading, dated 12 May 1998.

Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is.

Exotic Pests—Large Game Animals’ Classification

12. LARRY BALDOCK (United Future) to the Minister of Conservation: Does he agree that large game animals such as thar have been in New Zealand long enough to be considered indigenous and should therefore be treated as an indigenous resource by the Department of Conservation and not as an exotic pest for eradication; if not, why not?

Hon CHRIS CARTER (Minister of Conservation): Thar are not being eradicated but are subject to a 1991 policy and control plan agreed by the then Minister of Conservation, the Hon Denis Marshall. Thar are no more an indigenous species than possums or pigs, both of which have been in New Zealand for a far longer period of time.

Larry Baldock: Does the Minister agree with his colleague from Wainuiōmata, who declared himself indigenous because he has lived here many years; if so, why cannot the same standard be applied to thar, which have been here 100 years, and deer, which have been here for 150 years, and to trout and introduced game birds, or does ideology get in the way of common sense?

Hon CHRIS CARTER: I am pleased to say that I am not responsible for all the statements made by my colleague the member from Wainuiōmata.

Dr Ashraf Choudhary: Does the current plan make provision for recreational hunting?

Hon CHRIS CARTER: Yes. Hunters are given every opportunity to hunt thar on conservation land. I recently read an article by a thar hunter, who described his trip into the central Southern Alps as being the best he had ever experienced. He said that the trip was “real trophy hunting”.

Simon Power: Why is it that the Department of Conservation, in output class “Management of Natural Heritage”, which includes pest control, failed to meet 21 out of 35 performance targets in the year ended 30 June 2004, and what will this Minister do about it?

Hon CHRIS CARTER: The Department of Conservation faces a Herculean task in defending our native biodiversity. I am absolutely proud of the work that the Department of Conservation does. Yes, we could do more, and with more resources we would manage to.

Rod Donald: Has the Minister received any proposals that possums, stoats, and any other invasive species be protected by the Department of Conservation for the benefit of game hunters?

Hon CHRIS CARTER: No.

Gerrard Eckhoff: What is the Minister’s view of the presence of salmon and trout in New Zealand rivers and their impact on indigenous fauna?

Hon CHRIS CARTER: Those exotic species do not have quite the impact that, say, possums have. In allocating resources to deal with pests, I would certainly concentrate on those that are doing the most damage—that is, possums and stoats.

Larry Baldock: Would the Minister agree that although the indigenous member from Wainuiōmata can be a pest sometimes, the Prime Minister prefers the policy of management—

Mr SPEAKER: The member knows that he should refer to the member either as the member for Wainuiōmata or as the Minister if there is any ministerial responsibility.

Larry Baldock: Does the Minister therefore support the use of deer repellent with 1080 for use in pest eradication so that valuable game animals can be spared wasteful destruction; if so, when can we expect an announcement from the Department of Conservation confirming this?

Hon CHRIS CARTER: My department is still exploring what the implications of such a policy would be.

Hon Peter Dunne: I raise a point of order, Mr Speaker. I think you may have been a little unduly harsh on my colleague. I think that if you were to check the transcript, you would find that he did not refer to the member “for” Wainuiōmata, because there is no such member, but that he referred to him as the member “from” Wainuiōmata. Mr Mallard on many occasions has quite properly said that that is where he comes from. So, on reflection, Mr Speaker, I think you may have been a little harsh in bringing the member to order on that point.

Mr SPEAKER: Occasionally I can be a little harsh. I apologise.

Urgent Questions

Urgent Question No. 1 to Minister

Mr SPEAKER: This question was not strictly urgent, but I thought in view of the fact of the local elections that I would make an exception in this particular case.

Local Government—Election Results

1. Hon Dr NICK SMITH (National—Nelson) to the Minister of Local Government: What difficulties have arisen with the counting of STV ballots from the weekend’s local government elections and how long will this delay final results being announced?

Hon CHRIS CARTER (Minister of Local Government): There are issues of real concern. Just this morning I learned that elections.com and Datamail, companies contracted by councils to process single transferable votes in a number of local elections, have found an inconsistency in the number of votes entered into the calculator that counts the single transferable votes. This will delay the final election results even further for seven councils and 18 district health boards. I believe there needs to be a full inquiry by the Justice and Electoral Committee into these problems to ensure that they do not happen again. They are simply unacceptable.

Hon Dr Nick Smith: Is not this local election debacle—the sort we expect in a Third World country and not New Zealand—the responsibility of this Government, which rewrote the Local Electoral Act, providing for a complex and confusing mix of first past the post, MMP, and single transferable vote, and then compelled district health boards to conduct their elections under the single transferable vote system; so is not the responsibility for this mess firmly and squarely with this Government?

Hon CHRIS CARTER: The 10 councils that have chosen to adopt the single transferable vote system did so through their own choice. The responsibility of funding and organising the local government election is in the hands of local government. I compliment the member for raising this issue, though, because it is a very serious issue. It is unacceptable that we have waited this long for a result, and it must not happen again.

Mr SPEAKER: I am sorry to indicate that I had misunderstood. There is just the one supplementary question allowed on an urgent question.

Rod Donald: I raise a point of order, Mr Speaker. I think it is only fair that if one party gets a supplementary question on an urgent question, other parties should have the opportunity to ask a supplementary.

Mr SPEAKER: The member should read Standing Order 372(3): “The Speaker may permit the member asking an urgent question to ask one supplementary question.” I am bound by the Standing Orders.

Hon CHRIS CARTER: I seek leave of the House to table a statement that I put out very early this afternoon regarding this problem.

Document, by leave, laid on the Table of the House.

Rod Donald: I seek leave to ask a further supplementary question on the urgent question.

Mr SPEAKER: Leave is sought to ask a further supplementary question. Is there any objection? There is.

Questions to Members

Charities Bill—Submissions

1. DEBORAH CODDINGTON (ACT), on behalf of Dr MURIEL NEWMAN (Deputy Leader—ACT) to the Chairperson of the Social Services Committee: Does she intend to call for further evidence or submissions on the Charities Bill?

GEORGINA BEYER (Chairperson of the Social Services Committee): Calling for further evidence or submissions on the Charities Bill is a matter for the Social Services Committee to decide.

Deborah Coddington: Is the chairperson prepared to give an assurance on behalf of the committee that every organisation that provided a submission on the Charities Bill will be consulted on proposed changes to the bill; if not, why not?

GEORGINA BEYER: No, I am not prepared to give that assurance. That is a matter for the committee to discuss.

Bills

Holidays Amendment Bill

Instruction to Committee

Hon PAUL SWAIN (Minister of Labour): I move, That it be an instruction to the Committee of the whole House on the Holidays Amendment Bill that it take the bill part by part.

Motion agreed to.

Bills

Employment Relations Law Reform Bill

Instruction to Committee

Hon PAUL SWAIN (Minister of Labour): I move, That it be an instruction to the Committee of the whole House on the Employment Relations Law Reform Bill that it take the bill part by part.

Motion agreed to.

Bills

Electricity and Gas Industries Bill

In Committee

Debate resumed from 7 October.

The CHAIRPERSON (Ann Hartley): Before giving the member the call I shall rule on a matter that arose immediately prior to the Committee reporting progress when it was last considering this bill. On a point of order, an entitlement to a consecutive call for the first Opposition speaker was claimed. There is no such entitlement. The revocation of Standing Order 178 removed the requirement for the Chairperson to give preference to a member who had not previously spoken. The Chairperson now has the discretion to give consecutive calls. This does not mean that a member can claim a consecutive call as of right.

The giving of a call is always a matter entirely for the discretion of the Chairperson; it is not a matter for debate. Where a member seeks a consecutive call, and another member from the member’s own party also seeks the call, the Chairperson must also take into account the factors set out in Standing Order 102. The Chairperson has to have regard to proportionality as well as the seniority and interest of the member with the call. Giving a consecutive call might ultimately be at the expense of the member’s party colleagues.

The call, once given, cannot be taken away. During the point of order, Brian Connell sought to yield his time to the Hon Roger Sowry. Yielding is not a way of transferring one member’s speaking time to another. It is a way of providing time, during a speech, for a member to ask a question of the member with the call. But a member may choose not to continue his or speech. Brian Connell could surrender his call if he so wishes. It would be then for any member to seek the next call.

The question before the Committee now is that clauses 1 and 2 stand part, and Brian Connell has 5 minutes remaining, if he so wishes.

Hon ROGER SOWRY (National): I raise a point of order, Madam Chairperson. I listened to your ruling, and I want to take up with you the issue, which, I believe, you have inadvertently got wrong. At the start of your ruling you made the point that a claim was made that a member—and the claim was made by myself as the senior member speaking on this bill—was entitled to two consecutive calls. That was not what I claimed. [Interruption] I want to have your attention—I think that was half the problem. I never claimed that that was a right. I know the Standing Orders very well, and know that that is not a right. The point I was making was that, right the way through the debate, other Chairpersons had, by convention, been giving the senior spokespersons—who, in this case, was myself—consecutive calls, but only at the beginning of each part. We were at the beginning of a new part, and members were entitled—allowed, I guess, is a better word—to have consecutive calls.

The issue I raised with you was that it seemed odd to me, having been given consecutive calls on other parts of the bill, that when you took the Chair you did not follow the convention of the other Chairpersons. I made the point to you that I hoped that was not something you were personally doing—that you were operating with different rules or that, perhaps, you did not like me, or something. You advised me that you had given consecutive calls to me in the past. I have been back and had a look, and I can find an occasion on which that occurred, in the previous week. So I do not want to imply that you have a snitcher on one particular member. What I want to say is that it would be nice if you could, at the next meeting of presiding officers, raise the issue of senior members going for a consecutive call, so that it becomes the convention that that occurs, rather than have the sort of whim that took place last week. After all, all sorts of members will seek a call. Of course they will—they have to, to contest it. I say to the Chairperson that when I looked at the Hansard it was noticeable to me that the one time that a particularly hard-hitting speech was being given was the time that a consecutive call was not given. The debate, I have to say, with the Minister in the chair, has been largely non-acrimonious. There have been issues that we have disagreed over, around the bill, but the debate, in which the Minister has taken several calls, has been a good debate in the Committee. There was an issue around the retrospectivity of the legislation that was causing a heated exchange and a vigorous speech, and at that point the Chairperson chose not to give a consecutive call. All I ask is that you have a look at this and raise it with the other chairpersons, because it seemed to me, when I looked at the way in which the debate on the rest of the bill has been carried out, that the exercising of the call was being done for a wider range of reasons.

The CHAIRPERSON (Ann Hartley): I have been generous in listening to the member. There is nothing in what the member said that I did not cover in my remarks. The call cannot be debated, and I am ruling that nothing that has been said requires my ruling.

Hon ROGER SOWRY: Point of order—

The CHAIRPERSON (Ann Hartley): No, I have ruled. I ask the member whether it is a new point of order.

Hon ROGER SOWRY: Of course it is.

The CHAIRPERSON (Ann Hartley): I have been very tolerant to the member, but I have not yet heard anything that is a point of order.

Hon ROGER SOWRY: I raise a point of order, Madam Chairperson. This is the first occasion that I have seen on which someone has asked the Chairperson whether he or she would at least take something back and discuss it—which is what happens among presiding officers—and the Chairperson has ruled that he or she will not do that. Is that what I am to take from your ruling?

The CHAIRPERSON (Ann Hartley): The member will be seated. I have made my ruling. As I said, there is nothing in what the member has said that requires a ruling on a point of order.

Hon ROGER SOWRY: Point of order—

The CHAIRPERSON (Ann Hartley): I warn the member that raising trifling points of order is disorderly. I have ruled on the point of order.

Hon ROGER SOWRY: I raise a point of order, Madam Chairperson. I am not asking for a ruling—let me be quite clear. I am asking whether, as a presiding officer, you can establish a clear convention around the issue of a second call. That is all I am asking for. I ask whether you would accept that request and discuss the issue with the other presiding officers.

The CHAIRPERSON (Ann Hartley): I have made that perfectly clear in the ruling I read out.

Clauses 1 and 2 (continued)

JILL PETTIS (Labour—Whanganui): I am taking a brief call. This bill exhibits the leadership qualities this Government has, unlike that member who has just resumed his seat in mock impersonation of some sort of Napoleonic behaviour. Thank goodness he will never ever lead anybody into battle.

This bill puts in place all the decisions made by the Government this year on electricity supply security and on the governance of the electricity and gas industries. It repairs some of the errors that the previous National Government made. It is a good bill, with a thoroughly good Minister in charge, and the best thing we can do is to get this bill passed so that it can benefit the people out there in New Zealand.

Hon ROGER SOWRY (National): I want to continue on the points being made last week when this bill was being debated. Despite the senior Government whip’s pat reading of the Labour Party’s research lines about the Minister being good and all that sort of nonsense, the real issue is that when this bill was introduced and sent to the Commerce Committee last year, the Government said it had to be passed in a hurry. The Government made the energy companies and the interested sector people put in their submissions over Christmas—whilst the Minister was wandering around on a beach—and the select committee commenced hearings on the bill. We have now reached 12 October and the Minister is still trying to get the bill passed. He has backdated some of the clauses in this bill to 20 May 2003, which is when he deems that parts of this bill will have come into force.

National thinks that retrospective legislation is bad. In a commercial environment it is even worse. The Minister is not unpicking any of the commercial reforms of the electricity market. He is not doing anything for the market. The member for Whanganui clearly had not read the bill before she read the Labour research unit’s notes, because she alluded to the fact that this bill fixes up and changes a whole lot of the market. No, it does not. What it does is set up a bureaucracy to watch over the market, and sets up some rather convoluted workings between the Commerce Commission and the Electricity Commission, which, in fact, endanger the independence of the Commerce Commission.

As well as that, the bill overrides some of the contractual arguments or arrangements that might be occurring in the sector, and I want to particularly focus on those. Transpower charges lines companies, for example, for work that is being done or that has been carried out, such as upgrades and the like, by means of its transitional pricing methodology—so it is the lines companies who end up paying, in the end. One part of the bill provides that Transpower’s pricing methodology is deemed to have come into force on 26 January 2004. The bill was before a select committee, the Government clearly did not have an open mind on whether things would be changed, and it has now said, with regard to a whole lot of commercial arrangements, that it is too bad about any arrangements or disputes, because the State will use its power to ensure that Transpower gets paid what it requires. Of course, what happens is that individual consumers end up having to foot the bill, because they cannot contest it and the arrangements have run over the top of existing commercial arrangements.

I think that is bad. This matter was so urgent that it had to be passed quickly. United Future members voted procedurally with the Government, as they always do; they lay down on their backs and decided that this bill should go to a select committee and be dealt with really, really quickly and urgently. Then, of course, United Future did not put anybody on the committee anyway. They did not bother with it, so I guess it is to the fore for them. But what has happened is that the bill has come back before the House, taking not just 1 or 2 weeks or even 1 or 2 months to get to that stage, but months and months and months. We believe the dates in the bill should be changed, and we have put forward an amendment providing for that. We believe that it is commercially unfair to backdate it as far as it has been backdated.

PETER BROWN (Deputy Leader—NZ First): I have to say that New Zealand First shares some of the concerns raised by the Hon Roger Sowry. We are concerned that this bill is being made retrospective by quite some time, and perhaps the Minister could take a call to explain why it has to go back that far. This Government, only a week or so ago, said that when it came to criminals it was impossible to go backwards. It said that it was impossible for the Government to apply retrospective legislation in respect of guys who are thugs, murderers, and goodness knows what, but for law-abiding people, it can go back something like 18 months. That just does not sit comfortably with New Zealand First, because—as the Hon Roger Sowry has said—this bill has at least the potential to override some serious contractual arrangements.

I have said before that we in New Zealand First looked for three things in this bill. Would this bill address security of supply? We believe that by giving more teeth to the Electricity Commission, it probably does address that issue very largely. Will it reduce prices? Well, we do not believe that it will. We believe that this bill could be a formula for increasing prices. I personally had some confidence in the cheap lines charge of 30c a day plus a higher unit for power, and that confidence was shared by most, if not all, of my colleagues. However, recently I was in Dunedin, and the people there said: “Well, that might be all right and fair and proper for you guys in Tauranga, but come down here in the winter and see whether you can live on 8,000 units a year.” They told me that it was quite impossible, and that for Dunedin people it should be around 13,000 to 14,000 units, as it is so cold down there. I was there on a sunny day and I have to say that it was a bit chilly. So we do not believe that this bill will go terribly far towards reducing prices for the average consumer in particular, or even for the business consumer.

So the third question that we asked ourselves was: will this bill create a climate for greater investment in the industry? We have seen nothing that gives us any confidence that it will achieve that. In fact, we think that the best opportunity to increase investment in the industry would be to open up and take a more liberal attitude towards lines companies, and allow them to do so. They have millions of dollars that they want to invest in electricity. The only place they can invest in electricity is outside New Zealand, and the logical place for them to do so is Australia. I understand that several, if not many, of them are looking at investing in Australia or at using their finance to invest in some other sort of activity, altogether.

I have to come back to this. Had United Future shown a little bit more keenness, willingness, or conscientiousness towards this bill, we might have got something. Had that party put a member on the Commerce Committee—even though the member could not have voted, he or she could have turned up to hear the submissions—we might have got somewhere. But, no, United Future told members in the Committee that they did not like the maximum of 25 megawatts a year for lines companies and they wanted to increase it to 50 megawatts as an appropriate percentage. Those members did a deal in a back room somewhere—I was going to say a smoke-filled back room, but I do not think that it was smoke-filled. They did a deal, and that is not democracy.

The United Future members are shocking. Had they come to the select committee, they would have heard several representatives of the lines companies saying that they wanted to have a better opportunity to invest in the industry. They have the money and expertise, and they could increase the total capacity for New Zealand. The total capacity right now, as I understand it, is about 8,700-plus megawatts a year, and, on an ever-increasing basis, we need another 150 megawatts a year, every year from now on. If we believe Bryan Leyland, we will have to double that. I am not expert enough to say what exact amount we need every year, but it seems that there is a very good degree of common ground that is saying we need a lot more electricity capacity every year. The fundamental solution to that is investment, and the lines companies are the only people with the money to do it.

GORDON COPELAND (United Future): I will take a brief call in response to some of the remarks made by Peter Brown. There are two points. In terms of his accusation about backroom deals being done, there were no backroom deals. I raised the matter of increasing the megawatts from 25 to 50 here in the Chamber in a public debate that followed the cancellation of Project Aqua. Secondly, I wrote a letter to the Commerce Committee in that regard. In due course the select committee wrote back and notified me that it had received it and had considered it.

Dr LYNDA SCOTT (National—Kaikoura): The National Party opposes this bill. It is interesting having the title debate the way we do now. I can remember many, many days in this Chamber having title debates where it was, to say the least, very difficult to keep to the point. Usually, they became quite ridiculous as members thought up different names for a title. I think that it is good that we now have the title debate at the end, with a more wide-ranging debate to discuss the bill.

The National Party does oppose this bill. We agreed with submitters because they expressed concern over the Electricity Commission’s design. This institution’s advisory, operational, and regulatory roles will place it at risk of serious performance failure and judicial review. There is a belief that it will fail to achieve the independence required to be an effective and credible regulator.

We know that this country has suffered from a lack of investment in infrastructure under this Government. We have heard a great deal of rhetoric about the need to develop infrastructure, to develop our roads, and to have a security of electricity supply. In the Chamber today we have been talking about that. We have been talking about the fact that we have 8,700 megawatts of generation, and that we need so much more than that to be able to guarantee certainty of supply and price. A country cannot develop if it does not have those infrastructure situations correct and the ability to develop them. Twenty-five years ago this country had wonderful roads. Twenty-five years ago a lot of electricity was generated.

Gordon Copeland: I raise a point of order, Madam Chairperson. The member alluded to the fact that the Standing Order in relation to clauses 1 and 2—the title of the bill and the commencement date—has been changed, and that we no longer have wide-ranging debates on those clauses. I am yet to hear the member mention either clause or speak to them.

The CHAIRPERSON (Ann Hartley): The Standing Order has been changed to allow a more wide-ranging debate when we take those clauses at the end. Do members want it read out?

Lindsay Tisch: My colleague Dr Scott has taken part in previous debates in the Committee stage. She is familiar with the issues and is contributing now in the final debate, which concerns the title of the bill and the commencement. As you have indicated, Madam Chairperson, and as members well know, this is a wide-ranging debate that is like a peroration that brings together the arguments we have canvassed and articulated over the course of the Committee stage. That is the position Dr Scott is taking, and she should be able to continue in that vein.

The CHAIRPERSON (Ann Hartley): I will just quote for members from the review of the Standing Orders: “However, we consider that, when debating the preliminary clauses at the end, members should have some latitude to summarise,”—that is really what is intended—“and make concluding remarks about, the issues they have raised during the committee’s consideration of the bill.” I thank Mr Tisch. Did he want to add something more?

Peter Brown: I draw to your attention the fact that the member who raised that point did not speak once to the title nor make reference to the commencement date.

The CHAIRPERSON (Ann Hartley): That is not relevant because we are clarifying the point.

Dr LYNDA SCOTT: I am pleased to continue. We are in this Chamber talking about the Electricity and Gas Industries Bill because of the need to develop our infrastructure in that area. If United Future members, who are supporting the Government on this, want to take a better call and contribute for a little bit more than just 2 seconds, that would be very valuable. Perhaps those members should think about doing that and have more to say on this bill. United Future did not even have anybody on the Commerce Committee, so I am not too sure why that member is telling me I should be taking a narrower focus.

To continue, National has concerns about various provisions in this bill. National supports the total removal of the limits on line companies entering into generation, and that is one part of the bill we have supported. At the moment, when oil prices are at US$50 per barrel, being able to generate electricity from gas and coal reserves and looking at more sustainable forms of electricity generation as well, from wind and solar power, has to be a concern for any Government in this country for the future.

In parts of this debate we have talked about what happens when we end up being unable to invest in those sorts of structures. I am thinking about petrol and carless days, and of how that affects New Zealand. If we cannot get surety of supply it will affect businesses and the competitiveness of this country. Businesses must be able to look at New Zealand and come here thinking that they can get a good price for one of the major commodities of any business—being able to give surety of electricity supply.

I remember the spot market. I had a friend who bought a business and went on the spot market for electricity 3 years ago—the price was quite low at the time he did that. He owned a rest home, and all of a sudden he went from paying $8,000 per month to paying $20,000 per month for his electricity supply. That nearly put him out of business. Because this Government has not increased the funding to rest homes, he had no capacity to increase charges for any subsidised patients. The Minister of Health, Annette King, who is sitting over there, will know that our rest homes need to be friendly and warm in the winter. That cost went from $8,000 per month to $20,000—and that was just for a small business in New Zealand. Let us look at how that affects our major businesses—overseas investors will not look at New Zealand if they cannot feel they can come here and have a surety of supply. We need to better develop our infrastructure.

There is also concern in the National Party about proposals in the legislation covering the gas sector. That is a concern to us. National totally opposes the clauses that will allow the Government to direct the usage of infrastructure. To say that one company can develop gas fields, and then to direct that those gas fields can use somebody else’s processing infrastructure because there is spare capacity, will have a lot of people looking at whether they should invest here.

MOANA MACKEY (Labour): I move, That the question be now put.

A party vote was called for on the question, That the question be now put.

Ayes 70

New Zealand Labour 51; Green Party 9; United Future 8; Progressive 2.

Noes 49

New Zealand National 27; New Zealand First 13; ACT New Zealand 8; Independent: Awatere Huata.

Motion agreed to.

A party vote was called for on the question, That clause 1 be agreed to.

Ayes 70

New Zealand Labour 51; Green Party 9; United Future 8; Progressive 2.

Noes 49

New Zealand National 27; New Zealand First 13; ACT New Zealand 8; Independent: Awatere Huata.

Clause 1 agreed to.

The question was put that the following amendment in the name of the Hon Roger Sowry to clause 2(1) be agreed to:

to omit the expression “26 January 2004” and substitute the expression “31 October 2004”.

A party vote was called for on the question, That the amendment be agreed to.

Ayes 49

New Zealand National 27; New Zealand First 13; ACT New Zealand 8; Independent: Awatere Huata.

Noes 70

New Zealand Labour 51; Green Party 9; United Future 8; Progressive 2.

Amendment not agreed to.

The question was put that the following amendment in the name of the Hon Roger Sowry to clause 2 be agreed to:

to omit subclause (2) and substitute the following new subclause:

(2) Part 2 is deemed to have come into force on 5 October 2004.

A party vote was called for on the question, That the amendment be agreed to.

Ayes 49

New Zealand National 27; New Zealand First 13; ACT New Zealand 8; Independent: Awatere Huata.

Noes 70

New Zealand Labour 51; Green Party 9; United Future 8; Progressive 2.

Amendment not agreed to.

A party vote was called for on the question, That clause 2 be agreed to.

Ayes 70

New Zealand Labour 51; Green Party 9; United Future 8; Progressive 2.

Noes 49

New Zealand National 27; New Zealand First 13; ACT New Zealand 8; Independent: Awatere Huata.

Clause 2 agreed to.

Hon PETE HODGSON (Minister of Energy): I move, That the Committee divide the bill into the Electricity Amendment Bill (No 2), the Electricity Industry Reform Amendment Bill, the Commerce Amendment Bill (No 3), the Gas Amendment Bill (No 2), and the Crown Minerals Amendment Bill (No 2), pursuant to Supplementary Order Paper 242.

A party vote was called for on the question, That the motion be agreed to.

Ayes 71

New Zealand Labour 51; Green Party 9; United Future 8; Progressive 2; Māori Party 1.

Noes 49

New Zealand National 27; New Zealand First 13; ACT New Zealand 8; Independent: Awatere Huata.

Motion agreed to.

Bill reported with amendment.

Bills

Holidays Amendment Bill

In Committee

Part 1 Amendments to principal Act relating to payment for public holidays

Dr WAYNE MAPP (National—North Shore): As we indicated in the second reading, this is an extraordinary missed opportunity. The Government boasts that it is fixing up the unintended consequences of the Holidays Act. If it had listened to the numerous submissions, it would know that business has effectively rejected this bill. Business rejects it because of what it does not do; not what it does do.

The Government had the opportunity to fix the huge problems around relevant daily pay and it has wilfully refused to take that opportunity. These kinds of opportunities do not arise frequently, and that is why businesses are so concerned with the failure of the Government in this matter. Did it listen to the Meat Industry Association? The association’s evidence showed that the cost of sickness in the first 6 months that the Holidays Act has been in force went up 50 percent. Fifty percent more people are now taking sickness leave than before. Why do they do that? Because the reality is that people can get more by being sick than by working. That is ridiculous and the challenge to the Government was to fix this up.

We have provided the opportunity for the Government to fix that very issue. We have gone through a very careful process of preparing a Supplementary Order Paper. If the Minister cares to read it, he can vote for it because it is precisely what he—or rather his predecessor—introduced in 2003 in the Holidays Bill. The proposal that National has put on the table is what the Government introduced just 12 months ago. What happened was that after the select committee process, because there were no proposed amendments to the bill, a sneaky deal was done that introduced the concept of relevant daily pay—the source of all the problems.

I turn to Business New Zealand’s submission to the select committee in September of this year on the Holidays Amendment Bill. Business New Zealand made it very clear that it wanted this issue fixed. Government members had the temerity to suggest that Business New Zealand was part of the process of introducing relevant daily pay. That caused Business New Zealand to present a letter to the select committee which confirmed that at no stage did Anne Knowles of Business New Zealand indicate acceptance of the concept of relevant daily pay. Indeed, when the original bill was released it did not include such a concept, which is consistent with there being no agreement.

So we are offering the Government the opportunity to go back to its own proposal—the proposal that was fair and reasonable. It is an advance from the Holidays Act of 1981, and there was widespread concern that that Act needed to be updated. So why will the Government not take the very reasonable step of voting today to fix the most serious problem in the Holidays Act by voting for its own proposal? Because that is the opportunity it has. One would think that when the Government carefully goes through the Supplementary Order Paper that I have introduced, it will see that it can fix the serious issues, not the issues that it is claiming have to be fixed, which are minor and trivial compared with this major issue. We tell the Government to take this opportunity and vote for the measure that it introduced itself in the bill in 2003 and fix up the real problems of the Holidays Act.

Hon ROGER SOWRY (National): National is obviously totally opposed to the changes that are being introduced by the Government in the Holidays Amendment Bill. I say to the Minister in the chair, Paul Swain, that we are not opposed to it because we think the current legislation is working. Clearly, it is not. He has acknowledged himself that he made a mess of it last time around, and that he is trying to fix it. I would ask the Minister how he reconciles his view that he is fixing the problem with the view of submissioners to the Transport and Industrial Relations Committee—the Retailers Association, the Hospitality Association, Air New Zealand, Business New Zealand, Carter Holt Harvey, one of the largest companies in New Zealand, the meat industry, and Heinz-Wattie. They were all invited to the select committee, with the agreement of the Labour members of Parliament, to make submissions. None of them was listened to on the issue in this part, which is the issue of relevant daily pay. None of them was listened to, at all.

I direct the Minister to Air New Zealand’s submission. I hope he has read it, because Air New Zealand is a Government-owned entity and Government-owned entities do not usually criticise the hand that feeds them. Air New Zealand came before the committee and said a couple of things. One of the things it said was that the Holidays Act, which was passed by the Labour Government last year, was such a shambles that this week it is in court to try to get a ruling from the Employment Court on how to deal with the Act. That is the first thing. The next issue is whether this amendment bill fixes the problem for Air New Zealand. The answer is no. Air New Zealand told the select committee that it believed the “penal on penal” concept still exists, and that this bill does not fix the problem.

The debate on this bill will be interesting, because the Greens have said that they do not support the bill. They are not voting for it, at all. All the business groups oppose it. ACT, National, New Zealand First, and United Future have, individually, told business that they support the position of business. So one party has told porkies. One party is telling business that it is with business on this bill, but that party will vote with the Government to get it through. One party will do that. Which party has told the business lobby that it is with business and that it thinks the bill will not fix the problem, but will, in fact, vote for the bill? Which party will do that? We will watch with interest to see who it is.

We members of the select committee know that no business group supports this part—the penal rates of overtime—which, effectively, is the unintended consequence that the Minister kept talking about. That is not fixed. People who sell on commission and who work on a public holiday still get the extra commission on their sales that were not made on the public holiday. What sort of nonsense is that? It will stop many businesses from operating on the day. The Hospitality Association told the select committee that it is easier to stay shut, which gave joy to many Labour members I have to say, or to employ somebody—a mate—and pay him or her by way of a voucher for a bar tab or a free meal in the restaurant. It is easier to do it in that way than to actually employ someone. In fact, we have examples of the Hospitality Association now hiring people with a clause in their contract that states that they will not be employed on public holidays. That is not because the business will be shut, but because the business cannot afford to pay them on a public holiday, and it will come to other arrangements.

Hon PAUL SWAIN (Minister of Labour): The member has asked a couple of questions, and I will respond to at least one of them. He asked why we are doing this, and why we are not doing that. About 6 weeks ago I indicated that the intent of the bill that is now before the Committee was to fix the unintended consequences of the Holidays Act. A lot of the issues that the member has raised were not unintended consequences. That is the fact of it. This bill attempts to fix the unintended consequences of the Act, and that is the matter that is before the Committee. Those matters, which I announced 6 weeks ago, are providing for no penal rates to be paid for public holidays on top of existing penal rates—there was some confusion about that—and for no public holiday rates to be paid if an employee does not work on that day. There were indications that some people were taking sick leave on a public holiday and then getting time and a half, so we indicated that that was not the intention of the Act but was an unintended consequence. Some people said that there was an issue about trying to resolve composite pay rates, and the fact that there was not enough time to do that. We had indicated in the legislation that that could be resolved by the middle of next year, but a lot of people were saying that a lot of their contracts rolled over until 2007. We said that those negotiations should be allowed to go until 2007, or until the composite agreement was renegotiated. That was the point of that—to give more time to resolve the matter—and that was quite an important issue.

Then there was the issue about medical certificates. Under the current legislation employers are not allowed to ask for a medical certificate until after an absence of 3 days. I thought that it was important that where there was good reason employers could ask, on reasonable grounds, for a medical certificate. There were a couple of conditions attached to that—one being that the employer pay for it. The Transport and Industrial Relations Committee clarified that by stating that employees should be able to go to a doctor of their choice. I agree with that. The select committee has come back and made some further clarifications. It has stated that penal rates do not include overtime, that employees can choose their own doctor, as I have said before, that employers are only required to pay an employee’s reasonable expenses when requesting a medical certificate, and that employees who are asked for a medical certificate and do not provide it without good reason may not be paid sick leave. So the committee has made some clarifications around the provisions for employees to prove that they are sick, and that is where we are at on that matter.

I have added another little minor, technical amendment, which adds the word “into” after the word “entered” in new clause 2A in the definition of an “existing individual employment agreement”. That is to be consistent with the rest of the bill.

Finally, I should say that as far as support for the bill is concerned, my understanding is that the Green Party is not supporting the bill. I presume that I will hear from the Greens in a minute. Their view is probably that the bill goes too far, particularly around the medical certificate requirements. That is why, I presume, they are not supporting the bill, though I will wait to hear from them on that. New Zealand First has indicated support for the bill thus far, but is currently considering its position, I understand. But the United Future members, who have some concerns and will have at least one Supplementary Order Paper, have said that it is really, really important that at least these things happen now and we make progress on them, rather than wasting more time. I have always said that it was important that this stuff be resolved before Labour weekend, which is not this weekend but the following weekend. In fact, Peter Brown made a very, very good speech—and I listened to his speech, because I think he sometimes gives very, very good speeches—saying that a bird in the hand was worth two in the bush. That was basically the general message that he gave us. It is a position that United Future is taking, and I think that it is a principled position to take, as well.

So in the end this bill attempts to resolve the unintended consequences of the legislation that was introduced last year. By and large that legislation was designed to try to make sure that ordinary working people get time and a half when they work on a public holiday. That is a good and fair thing. It will also introduce 4 weeks’ annual leave in 2007, which is another good thing. But there are some minor amendments that need to be made to take away some unintended consequences of the Act, and therefore I urge members to consider this bill in that light.

KEITH LOCKE (Green): I raise a point of order, Madam Chairperson. As I understand it, we are on Part 1. The Minister talked about medical certificates, which I understand come under Part 2. I have not taken a call yet, but just want clarification that we are only on Part 1.

The CHAIRPERSON (Ann Hartley): The member is quite correct, and there was also another reference to a matter that is not covered in this part, as well. So I would caution members to stick to the content of Part 1.

Hon RICHARD PREBBLE (ACT): We are dealing with an amendment to the Holidays Act, and I rise on behalf of the ACT party to say that not only will we be opposing this bill but we have had a look at Dr Wayne Mapp’s amendment, and we would recommend very strongly to the Committee that it support that amendment. I tell the Minister that he would have been very wise to read the submissions on the bill. What the Committee should understand is that the business community was not given a chance to make submissions. The Transport and Industrial Relations Committee invited submissions from just a number of industries, and it could have gone wider than it did. I think that the submissions received by the select committee were devastating in their effect, and one of them was this. Human beings take a while to adjust to new incentives. We all know that. The legislation came into effect only in April. The meat industry, which is still our largest single exporter, produced this extraordinary chart, which members may not be able to see, but they can get a copy of it from me. It shows the cost of sick pay and how that cost has increased since April. When one studies the chart, one finds the cost of sick pay—which has been normalised—was $16 million, which is a very high figure, and it has already jumped to $27 million just since April.

What would cause the rate of sick leave to go up? We could look at Ministry of Health statistics to see whether we have had an outbreak of any disease. No, we have not. So, clearly, there is something in the nature of the Holidays Act that has caused the increase, and what it is is the late change about relative daily pay. Instead of sick leave being based on a person’s ordinary pay, it is now based on a person’s total payment. What is unfair about that is that someone may have had included in his or her pay an incentive for turning up to work. Now, according to the Government, that incentive must be paid to people who are sick. Of course, it costs money to go to work, and as the meat industry pointed out, people are actually being paid more not to work than to work. Human beings do respond to incentives. I know that the Greens do not necessarily believe that, but people do respond, and they are responding. If they are to be paid more for not working than for working, people stay away, and in shift-work situations some bizarre situations arise if people have just received a large bonus, because the relative pay is not worked out on the basis of the whole year but on what happened in the last 4 weeks.

We were given an example by Heinz-Wattie, a very large exporter, of a particular person who is normally paid, I think, $16 an hour, and the company had to pay him $38 an hour to stay away from work. The incentive to stay away is great. Then we go to Carter Holt Harvey—I think it is our largest company; if not, it is very close to being that—which told us that the average number of sick days each employee has is 100. Now, that was calculated first at the ordinary rate of pay, but many of the staff work on shifts, so Carter Holt Harvey’s contingent liability has gone through the roof. But it made another statement, to the effect that it is a multinational company, so it can choose where to invest. It asked why, when it is thinking about investing, it would choose to invest in a country where we have a loony system whereby its staff are paid more for being sick than for working. The Kawerau plant produces over 1 percent of the total gross domestic product of New Zealand.

I thought it was very interesting that the Minister told the Committee that the reason that the provision was not changed was that it was not an “unintended consequence” of the Act. We listened to Ministers earlier today say that at the IMF this country had been described as the best place to do business, but that was because of changes made before the Act. The Government cannot have it both ways: it cannot say it is wonderfully flexible, and then introduce all these inflexibilities. Where does it stand? I ask Government members why this is not a matter that employers and employees can settle for themselves. They have been doing that for most of the history of this nation. We did not need the Government to come in and define relative daily pay. That is an example of the Government interfering in the marketplace, and my recommendation to the Committee is that we should support the amendments put forward by Mr Mapp.

Dr the Hon LOCKWOOD SMITH (National—Rodney): In speaking to Part 1 of the Holidays Amendment Bill, I want to know why the Minister in the chair, the Hon Paul Swain, does not admit to the Committee something that we all know: that he does not believe in this stuff, at all. We know that the Minister does not support the amendments to the Employment Relations Act, and we know that he does not support this junk, either. We know that the Minister has been rolled by the left-wing faction of the Labour caucus—we know that.

I have some particular questions for the Minister relating to Part 1, because as I read Part 1, in conjunction with the principal Act, I see no exclusions for salaried people from the provisions of the Holidays Act. I see no exclusion based on the level that salaried people are paid. I want the Minister to explain whether members of Parliament who work on public holidays—[Interruption] I say to the Minister that this point is quite serious. I ask him whether members of Parliament who work on public holidays—often we have to, and sometimes we choose to—will be paid time and a half.

My second question is whether the Parliamentary Service is exempt from employment law in this country, because I wonder when members of Parliament will see an employment agreement. As an employer I have to, by law, provide an employment agreement for my staff. When will the Parliamentary Service provide me with an employment agreement? Will that employment agreement indicate by 1 April 2005, according to Part 1 of the bill, the time and a half that I will get when I work on public holidays? Or is this law something that poor damned employers out there have to comply with, but that the Parliamentary Service and all the wonderful outfit around here do not have to comply with? Does the Minister think that dirty, nasty employers out there have to comply with it but the Parliamentary Service is above it because the ordinary staff do not work on public holidays in this place, although members do? I want the Minister to explain whether members of Parliament, every time they have to work on Anzac Day, Labour Day, or whatever holiday it is, will be receiving time and a half, and on what basis that will be calculated. I see no exemption here in this bill for members of Parliament or for the Parliamentary Service Commission.

What is more, what happens for employers whose staff are on high salaries in order to deal with all this junk? Such employers actually offer a high salary and leave it up to the employee or the manager to choose when to work. Employers may offer people thousands of dollars a year more than the usual rate so that they can avoid this garbage, but under this bill, as I read Part 1, they cannot avoid it. Even if an employer offered $10,000 more a year in an employment agreement than the going rate for a normal job in order to get out of this junk, the employer cannot do so. Part 1 basically states that no, the employment agreement has to spell out how time and a half is to be covered, and that it has to go through the whole nonsense of the relevant daily rate of pay. I put it to the Minister that many employers have tried to get out of that compliance cost problem by offering far higher salaries than usual in situations where employees have control over when they work. What happens when an employee does have control over when he or she works, but chooses to work on a public holiday, and then comes along to the employer and says he or she wants to be paid time and a half based on the relevant daily pay rate? That walks all over existing agreements.

Does the Minister expect employers, next time they negotiate an agreement, to knock several thousand dollars off a salary package, so they can actually then cover the ridiculous bureaucratic junk in this bill? Is that what the Minister expects? That is what will happen if employers are faced with having to pay this sort of thing on top of generous salary packages. I cannot see where this bill exempts people on high salary packages from having to go through this sort of nonsense. I would appreciate the Minister explaining to Parliament whether members of Parliament—who must be employed by someone, although I have never seen an employment agreement—are exempt from this legislation.

PAUL ADAMS (United Future): United Future will be supporting this legislation because we have discovered that one eats an elephant one bite at a time, and this is one bite we are taking that is heading things back in the right direction.

Opposition Members: Ha, ha!

PAUL ADAMS: It would be nice of my colleagues around the Chamber, who are so supportive of employers, as I would be, to give the Hon Paul Swain a little bit of credit where credit is due for bringing in legislation that is heading us back in the right direction. But as has been pointed out, I do have some areas of concern, and I look forward to the support of my colleagues on this side of the Chamber for my Supplementary Order Paper, which deals with people’s income where a large proportion is earned by commission.

Take, for example, the higher-paid salesperson who may be on a higher retainer than normal, a person who is on a $269 per day retainer, yet probably earns another $30,000 or $40,000 above that in commission. Unfortunately, if my Supplementary Order Paper is not passed, it would mean that people working on, say, Good Friday, would have to be paid $512 for that one day and on Easter Monday another $513 for the day. However, in the case of commission salespeople, they will work to earn their commission. Employers will have to pay not only what is based on their relevant daily pay for the year, but, of course, they also have to pay their salespeople the commission that they earn on that day.

If this does not have the support of the Parliament, I am concerned that if that salesperson decided that maybe one of those statutory days was a very poor day for customers coming into the yards because they are spending time with their friends and family, one does not have to be a rocket scientist to work out that one will get much more money by staying at home. Therefore, I look to my colleagues over here to support my Supplementary Order Paper because I think that that example shows exactly some of the challenges we face with this legislation.

Let me say also that United Future absolutely supports holiday pay being based on ordinary pay and not relevant daily pay. However, because we are the common-sense party and we believe in taking one step at a time, we recognise that although this legislation is not perfect it is better than nothing. United Future wants to progress. We are happy to go one step at a time. We are happy to go a little bit slower than some other party would go.

I have never found any common sense at all in saying: “This is not everything we want so I’m not going to do it.” I think the little kids do that. One looks at something and says: “Hey, is this going in the right direction or is it going in the wrong direction?”; when United Future members look at it they say: “This is going in the right direction”, and we put up our hands and say: “Well done, yes, get on with the job.” As a small employer myself I am very pleased that this legislation has a great chance of passing before the next holiday period. I believe that many small employers out there agree with this, and they will be thankful that United Future is in this Parliament to support this legislation to help them out.

Hon MAURICE WILLIAMSON (National—Pakuranga): The previous speaker, Paul Adams, said that one eats an elephant one bite at a time, but I say that one swallows a dead rat whole. I have to say that this is swallowing the biggest of dead rats I have ever seen. This is an appalling fix-up of a muck-up. I have to be careful in the way that I say it because if I get it wrong I will be thrown out of the Chamber. It is a fix-up of a muck-up. I will tell members why it is a fix-up of a muck-up. When the original bill in relation to holidays was put through, the Government mucked it up. But today the Minister would have us believe that there are some unintended consequences that are now being fixed. I have heard him say that. Unintended consequences are also written about in the commentary to the bill. Has the Minister not read the commentary to the original bill that has the minority report from Deborah Coddington of ACT? That report makes it clear that these would be the consequences. The Minister cannot hide behind the fact that he did not know, that the consequences were unintended, or that after it all happened the rest of the world sort of went mad and said: “Oh, my God, I didn’t realise that.” It was brought up at the time. It was absolutely the clear intention of the Government at the time, and suddenly it has all become too hot in the kitchen. There are already too many dead rats in the boiling pot all at once and the Government has decided that it had better bale out of it. So we now have a bill that is even more of a hotchpotch.

I want to concentrate on relevant daily pay. I say to the Minister and to the people who are listening to this debate just how bizarre this gets. Relevant daily pay will not be just one’s ordinary wage, but all of the other bonuses for attendance, penal payments, tool allowances, and things that people get as part of their job. I want to go back to my days when I drove for Refrigerated Freight Lines driving a large truck and trailer units, and so on. We received wet money—the Labour Party gets wet money every day because it is full of wets—when it was raining. If we were not putting containers on, but had palletised milk powder, we used to get a cover allowance because we had to put big covers over it, get up on the top of them, and strap them down. We used to get a rope allowance. We used to get all these little bits and pieces. If it was not wet, we did not have pallets, and we were not using ropes and covers, then we did not get those allowances.

However, when people take days off as holiday, how many people on their holiday get out into the back yard, throw the tarpaulin over the house, and start to pull ropes just for practice? If it is raining and they are on holiday they will go to the movies or whatever. Why should people get any of those special payments—the bonuses and additions—when they are on holiday? I do not think people should be getting any of them anyway. I argued at the time that people should be paid a straight base rate that was the proper rate, and that getting wet as a truck driver was one of the hazards. It is like getting wet around Parliament can be a hazard. Many people have got quite wet around Parliament!

This bill states that when people are off on their holidays they will be paid according to their relevant daily pay calculation. It will take account of all those special things they are paid because of the conditions that they were under while working, even though they are not at work. For example, when people decide that they will have their holiday next week and get their penal rate and their relevant daily pay, the other poor sod who is back at work driving a truck, and it is not raining and he does not have to put up tarpaulins, is actually getting a lower rate of pay while he or she is at work than his or her mate from the same shift who is off on holiday swanning around the Gold Coast telling people: “I’m getting wet money today.”, and when people say that it is a lovely sunny day: “It doesn’t matter, the Government of New Zealand is so stupid that it passed a bill that gives me wet money even when I’m on holiday.”

That is what this bill does. That is why we are opposed to it. We think people should get a proper rate of pay when they are on holiday and maybe when they have worked on a public holiday and are now taking the time off when it is a public holiday, but not this absolute stupefying nonsense. This is mega dead-rat swallowing.

What do members of the business community think about it? If the Minister was listening at all, if he would wax out his ears and listen to what members of the business community are saying, he would hear that they think this is an absolute outrage. If there is one thing members of the business community—and if any members of this Parliament say they have never heard it I want to talk to them—say day and night, it is that they are sick to death of compliance costs in this country, and this adds to it.

JOHN KEY (National—Helensville): This Committee knows that the Act was introduced on April Fool’s Day by the then Minister of Labour, Margaret Wilson. It does not take many examples to work out why it was introduced on April Fool’s Day. This bill gives people time and a half—

Government Member: One plus one equals three.

JOHN KEY: Yes, one plus two equals three. If Michael Cullen cannot work that out he is not as bright as I think he is, but I digress. This bill gives people—salaried employees—time and a half and a day in lieu. Let us just imagine the situation for a moment—Theresa Gattung is sitting in front of the TV watching something on Easter Monday, and she gets a phone call to go to the office to do a couple of hours of urgent work. She will get $15,000 for that—that is, time and a half and a day in lieu for popping in on Easter Monday. That is not bad.

I can see why Margaret Wilson got the boot when this bill was introduced. In less than 6 months we are now in a tremendously embarrassing situation where the new Minister of Labour has had to come to the Chamber and pretend he is fixing it up. This is the same Minister about whom it was said, in regard to the next bill coming up: “Don’t worry, business community, Swainey and the boys will sort it out.” That came from the Minister who said: “If George Hawkins is out of here, I’m out of here as well, and so is Clayton Cosgrove.”, to which the Prime Minister said “Clayton who?”, but that is another issue completely.

I sat on the select committee—[Interruption] I tell Mr Hughes that that is the absolute truth. If I am in better touch with the political situation than the Labour Party, then so be it. I sat on the select committee with the Hon Judith Tizard and listened to employers who came in.

Dr Wayne Mapp: Was she swearing?

JOHN KEY: No, she was not swearing; she was very polite.

Dr Wayne Mapp: Was she awake?

JOHN KEY: She was awake, but she was polite. Anyway, I will not say any more. I have got myself into a lot of trouble recently, and I need to understand that. Employer after employer came to the select committee and said that they had spent years defining ordinary pay. They had reached the situation where they now understood what ordinary pay is, and by defining relevant daily pay, we would be forcing them to go back to all of their contracts, and now they would have to go back to a much more convoluted process where they would now have to de-engineer, and that has not happened. What has happened is that Paul Swain, who has been put up as the Trojan Horse for some sort of sensibility, reality, or—[Interruption] In theory, he has done that, but in fact he has not fixed the problem at all. What he has done has fixed the—[Interruption] No, he has not. He has fixed the incredibly embarrassing situation where people were taking a day off on a public holiday, and getting time and a half, and watching television or going to the races. He has not fixed the problem of Theresa Gattung being paid $15,000 and having a day off. He has not fixed the problem that thousands of New Zealand employers—[Interruption] I think it is great that Theresa Gattung gets $2.5 million, but it is mad that a salaried employee would get paid time and a half and a day in lieu. If that is the Minister’s intention I would welcome him taking a call. Was that the intention? Did he intend that Theresa Gattung be paid $15,000 and get a day in lieu for popping into the office? Was that what “Swainey and the boys” will fix? Was that what it was all about? Is that what John Tamihere was thinking? Is that the fix-up of the muck-up? It is not.

When I sat on the select committee, employer after employer came in. They came from the restaurant industry and what they said to us was very clear, indeed. They said they could not afford to operate under those conditions. Under the margins they had they could not afford to provide services, and when visitors came to New Zealand on our airline—the pride of the Pacific—and wanted something to eat, the only thing that would be open would be Paul Swain’s house, cooking up some food. That would be the only place they would get a meal, because no restaurant will be able to afford to pay waitresses as much as that. Restaurants will not be able to afford the margins. They begged us—

Hon Maurice Williamson: Let them eat cake.

JOHN KEY: That is right.

PETER BROWN (Deputy Leader—NZ First): I think everybody agrees that the Holidays Act needs tidying up. It was a mistake. It was like a camel, which is a horse, designed by a committee. We stuffed up and it needed some urgent attention and I know that the Minister acknowledges that. The bill he has produced does address—one has to be absolutely truthful—a couple of the issues. It addresses some concerns around sick leave, and we now know that he addresses them so comprehensively that the Greens will not support the bill. However, it does address those concerns around sick leave.

It also addresses the concern about an individual putting his or her name down to work on a public holiday and then pulling out sick and demanding to get paid at time and a half on top of everything. It addresses those two issues. However, it does not address the issue of relevant daily pay. The amendment in the name of Wayne Mapp, which he assures me is a direct copy of the original bill, does bring it back to what it should be. The United Future party should support this, because basically, this legislation started out as a Government bill. I cannot figure out where the relevant daily pay occurred. Did it occur in this House after the select committee? I cannot readily recall whether it did go through the select committee.

Hon Paul Swain: Yes, it did.

PETER BROWN: So it was dreamt up there and advanced the Government’s original intention into embracing relevant daily pay. That is a significant mistake. I have to say that it is a far bigger mistake than I thought at the time, and I believe Wayne Mapp’s Supplementary Order Paper will address that issue fairly and properly. I cannot see how the Government, or indeed, United Future, can vote against this, because it was in the original 2003 bill.

The concern we have in addition to that is the concern about people on a salary—not only Theresa Gattung but people even on a lesser salary. We cannot understand or accept why an individual cannot negotiate a salary with his or her employer that embraces everything. In other words, they know what they are going to get from the start of the year to the finish of the year, and they have a good idea of their responsibility, or what will be required of them in terms of their work. We have quite some discomfort in having to pull those salaries apart and then put them together again when it comes to working on a public holiday, or whatever.

A Supplementary Order Paper in my name simply addresses that issue. It states “Notwithstanding anything in section 51 or any other section of the principal Act, nothing shall preclude an employer and an employee (or their respective representatives) from negotiating an employment contract, based on an annual salary, which includes a provision for working none, some or all public holidays without any further remuneration.” That is pretty clear cut and I believe that this legislation should be amended to embrace that Supplementary Order Paper.

In summary, there are three issues. The bill addresses some of them. It addresses the sick leave and getting paid on a public holiday when a person is not working, although he or she might have put his or her hand up for working. The Holidays Amendment Bill addresses that issue. The Wayne Mapp Supplementary Order Paper addresses the concerns around relevant daily pay, and they are very, very important concerns. They should not be taken lightly. It addresses them fully. What amazes me, and Wayne Mapp assures me that this is a direct—

Dr Wayne Mapp: It is an amalgam of several clauses.

PETER BROWN: But every clause in the Supplementary Order Paper was in the original bill. We think that is a good place to go back to and to put a degree of common sense and fairness into the thing. Finally, my Supplementary Order Paper will bring in the salary.

Hon ROGER SOWRY (National): The Minister of Labour took a call and answered one question that he had been asked; he said that his intention in introducing the legislation was to try to fix up the unintended consequences of the Act. What he has not answered in the Committee is how it fixes the Act for business people who are worried about relevant daily pay, because that is the biggest issue.

Even the United Future people, who have told people who have asked them, business people and so on, that they are on the side of business, have come to the Chamber today and told us—it was news to me; I have just been talking to some people out there, and it was news to them as well—that their Christian view of the world is that they tell people one thing in their offices and do a different thing in the House. That gives a whole new meaning to turning the other cheek. United Future acknowledges that the bill is a mess, but it is sort of having it both ways; it is saying: “Well, if you’re going to eat an elephant, you do it in small bites. We know that this bill doesn’t fix it, but it does something, so we think it’s OK.” Well, actually, it does not do anything. Air New Zealand is still going to the Employment Court to fix it. Does United Future think that is OK?

Perhaps I could ask a couple of questions. Will United Future take a call and tell us whether it believes that relevant daily pay is fixed?

Paul Adams: I’ve already done that.

Hon ROGER SOWRY: No, the member has not. Will he take a call to talk about relevant daily pay? He talked about people on commission, but he did not talk about relevant daily pay. Will United Future tell us what it told the business lobbyists? Will it tell us that? Perhaps if the United Future member who is in the Chamber telephones his leader, they could sort out what the leader has said versus what the member is saying. It is a bit like when United Future members took the petition from Federated Farmers on the steps of Parliament; they said one thing, then brought their Christianity in here and did the opposite. It is the same story from that party all the time. I ask United Future members how they can do that.

Paul Adams: It’s quite simple—it’s sensible.

Hon ROGER SOWRY: He says it is quite simple. Does he not believe in telling the business community, upfront and honestly, what he will do, before he does it? Why did he not do that in this case?

Paul Adams: They didn’t ask.

Hon ROGER SOWRY: The member says they came and told him what they wanted, but, because they did not ask, he did not tell them what he would do. I think that is dishonest. Does the member have a different view of honesty?

Paul Adams: No, I don’t.

Hon ROGER SOWRY: Well, next time he stands up and gives one of his moralistic lectures in the House—

The CHAIRPERSON (H V Ross Robertson): I just advise the member, who is a longstanding member, that it is inappropriate to indicate that another member is dishonest.

Hon ROGER SOWRY: The party is dishonest in the way that it has handled this legislation—

The CHAIRPERSON (H V Ross Robertson): Reference to a party is consistent with reference to a member, as well.

Hon ROGER SOWRY: Right now those business groups are feeling downright deceived. Was that the member’s intention? Was that United Future’s intention?

Darren Hughes: This member always does this.

Hon ROGER SOWRY: No, no; he’s trying to say something. What was his intention?

Paul Adams: They’re pleased with some progress.

Hon ROGER SOWRY: He says they should be pleased with some progress. So the fact that they feel deceived is their problem, not his problem; the member thinks he did not deceive them in not telling them what his party was going to do, even though he had led them to believe something different.

STEPHEN FRANKS (ACT): It is a pleasure to be able to speak for the ACT party on this bill and to listen to the debate. It was interesting to come into the Chamber when the United Future representative was on his feet trying to explain why, when something is wrong that one thinks should be fixed, it is better to take one step at a time instead of fixing the problem. The member simply ignored and failed to answer any of the challenges that he explain why he would say it was better for him to vote in support of the Government, which caused the problem in the first place; to vote in support of its grudging and tiny steps to overcome the political damage it has caused—none of it driven, of course, by concern about the economic loss or frustration of, or the wound caused to, all those people who make up the pay books. Just think of those women—often, they are women—who stay up late at night making up the pay books of their husband’s or partner’s business, in frustration poring their way through the complexity that this Government has created.

United Future thinks it would be far too bold and far too direct to remedy the problem for those people right now; it thinks that just one wee step at a time should be taken. Well, the challenge that was given was to take two or three steps, particularly as Dr Mapp has proposed amendments that United Future, if it believed that there was a problem and if it would rather see it fixed, could support. Why does it not support the amendments put forward by the National Party? We did not hear the United Future member say that he thought they were wrong. We did not hear him argue that the Government was right in refusing to go further. We did not hear any explanation of why United Future will take only the one tiny step from time to time that Labour says it can take.

Dr Wayne Mapp: It’s called “yap, yap”.

STEPHEN FRANKS: Yes. “Please release my leash so it is a little longer; you’re stepping on my toes—or my claws.” We know that in about 3 or 4 months’ time United Future members will be looking desperately for bills such as this, so that they can pretend to disagree with the Government. We can see it coming now. When there is anything that looks like an amendment to the holidays legislation, and people are paying attention to it, we will see United Future members looking like lions. They will be out there saying: “Some giant steps are needed here—some real reforms. Those who talk about little steps, those who think we are too close to Labour, those who think we have no mind of our own, those who think we have no confidence and courage, are all wrong. When it comes close to an election, we take big steps. We’ll have a real row with the Government.” But why not do it now? If United Future is prepared to have a row—

Darren Hughes: Tell us ACT’s election strategy.

STEPHEN FRANKS: The ACT party’s policy is absolutely clear on this. The bill was a mistake at the beginning. It is still a mistake. This step is an insult to those people who make up the wage books. This step, from a party that I once belonged to, a party that actually believed in looking after the working people, a party that worried about those who worked hard instead of those who had privileges, is a disgrace. It is a disgrace that United Future is supporting it, but it is much more of a disgrace for Labour members to come here and say that they have made a mistake but they will not fix it; that they will fix just a wee bit, because that does not offend the unions; that they will inch the matter out and make it more complex; that they will put in more definitions; and that they will allow employers to ask for proof of ill health, as long as they pay for the doctor. They will not let them stipulate what doctor is involved, so, in every town, people will come to know which gatekeepers are corrupt. There are doctors who do not act as gatekeepers. It is actually not their duty. Their oath says that their first and supreme duty is to their patient. If they have patients who say they badly need a holiday because they are stressed, and ask for a medical certificate, it may be that some law might one day bite the most egregious of them—the ones who are least honest.

The CHAIRPERSON (H V Ross Robertson): I call Martin Gallagher.

LINDSAY TISCH (National—Piako): I raise a point of order, Mr Chairperson. I have been seeking the call for some time. I have been standing to seek the call, even though you may not have noticed. I would certainly like to participate in this very important debate for National. With your indulgence, I seek a call.

The CHAIRPERSON (H V Ross Robertson): The member should wait and see what I am going to do. He well knows I indicated to him that I intended to call him next, anyway. But, first, I have called Martin Gallagher.

MARTIN GALLAGHER (Labour—Hamilton West): I move, That the question be now put.

LINDSAY TISCH (National—Piako): Thank you, Mr Chairman. I knew that if I stood for long enough I would get the call at some stage—that someone would notice.

United Future members have not taken any notice of all the submissions that came in. The member over there said that it took a long time to eat an elephant. Well, I can tell members that it will take years and years to eat the elephant that he talked about, and he calls that progress. We on this side of the Chamber say that the comments made by the United Future party just do not stack up. When my colleague the Hon Roger Sowry asked how the relevant daily pay provision, which is the essence of Part 1, could be justified, the reply was that the Government was making some progress on it.

I say to United Future members that they are doing business an absolute disservice by supporting the Government on this legislation. Businesses will be in for a very expensive Christmas. The Christmas and New Year holidays will be an expensive time for businesses. The Holidays Act states that some public holidays that fall on the weekend must be “Mondayised”—that is, observed on the following Monday or Tuesday. In the summer of 2004-05, all four public holidays—that is, Christmas Day, Boxing Day, New Year’s Day, and the other New Year holiday—fall on the weekend. That means 7-day businesses will face increased wage and time-off provisions for a total of 8 days, not 4 days.

Hon Maurice Williamson: You’re kidding!

LINDSAY TISCH: No, I am not kidding. That is what the relevant daily pay provision will do. There will be a build-up of all the overtime hours that people work, and the allowances they are able to get for working in the build-up to the Christmas period—the festive season. For businesses the festive season means that they will be out of pocket. Business owners will get to the stage where they will say: “Why should I bother?”. We are already seeing it in the restaurant industry. Cafe owners are saying: “Why should I bother to open on a statutory holiday? It’s not worth it.” In fact, some of them put a surcharge on a cup of cappuccino that is purchased on a statutory holiday. We go along to buy a cappuccino, latte, flat white, or whatever, and we find there is a surcharge. The owners say: “Well, if we have to pay relevant daily pay to our workers if we open on a statutory holiday, then we have to put a surcharge on, to make it work.”

What happened to the concept of “ordinary pay”? I am an ordinary person and I have a clear idea of “ordinary pay”. It is not a concept that should be devoid of meaning. “Ordinary pay” has been around for the last 50 years. What happened, in terms of calculating staff holiday pay, to paying staff 6 percent of the gross take? Remember those days? Workers were paid 6 percent of the gross take as holiday pay. It was very clear. There was nothing complicated about it. I did not have to work out, in the months before, what would happen with overtime, or the allowances to be paid—meal allowances, tool allowances, travel allowances, and all those allowances that are incorporated into what will be known as relevant daily pay.

National members are really concerned about this measure, because this is a step backwards. Members will recall that my colleague John Key noted that the new Holidays Act came in on April Fool’s Day. It came in on 1 April this year. National members said during the debate last year and at the beginning of this year that the legislation was a step backwards. We are a nation of small businesses—295,000 small businesses employ fewer than five people—and the legislation will kick them. What will those businesses do? If they have to look at the bottom line, it will be the workers, the employees, who ultimately will suffer.

Hon RICHARD PREBBLE (ACT): I hope we will hear from Dr Mapp again, because he presented the excellent Supplementary Order Paper 278, and I do recommend it to the Committee. I say to members that I think it is a very good move to take the original bill that the United Future party voted for, and that the Greens also voted for—

Paul Adams: No, we didn’t.

Hon RICHARD PREBBLE: The member thinks this is better now than the original bill? Well, that is very interesting. The member said that he did not vote for the original bill, but now that the bill is a muck-up, he will vote for it in order to help the Government. I think that is extraordinary.

I just want to draw a simple fact to the attention of Government members. I do not think there are very many members of the Government who have ever employed a fellow New Zealander with their own money, so they are probably not aware of the impact of holiday pay. [Interruption] The member should just listen to this example. No doubt she is pleased with the fact that the Department of Labour’s latest statistics show that people’s wages went up by 1.8 percent, which means that people were getting paid more money. Yet in that quarter the actual cost of labour fell. Is it not extraordinary that wages went up by 1.8 percent, yet for employers the cost fell? The reason for that is that Anzac Day fell on a weekend. One day’s change was enough to make that much difference. For the particular business that I am in, where Easter falls makes an amazing difference to the return from the business.

This Government has put in an incentive for people to take extra sick days. Most New Zealanders do not take every sick day that is available to them. But when the Government states by law that an employee will be paid more money for not working than for working, the number of people who take extra sick days will go up. Even if one is being conservative, the number will go up by at least 1 day per worker per year. That may not seem to be very much to Government members. I have to say that the officials who worked on this bill were disgraceful. I normally get up to say that the officials were excellent. The Department of Labour has benefited enormously from this Government. The size of the department has gone up, it has been able to run all sorts of rorts, and it has paid people to study hip hop around the world. I thought the actual evidence we got from the department was disgraceful. The sort of evidence one would expect civil servants to give MPs is to say to us that we should realise we are making New Zealand a less competitive place, and that we are putting huge costs on small business. We had an example from Wattie’s, which said that in one particular factory that it runs it has had to employ an extra six people just in order to work out the sick pay and the holiday pay. That is six people who are not being productive. We have a trade union official, Helen Duncan—who is now heckling—who voted for all that in the Transport and Industrial Relations Committee, but she is not prepared to get up and say how New Zealand is a more prosperous nation by having all that extra red tape and bureaucracy.

We have seen the United Future party and its extraordinary explanations as to why it is a doormat for the Government. I think Helen Duncan, if she is proud of this bill, should take a call and explain to small business why all this extra complexity has been put in place. She should explain to people who work in freezing works the justice of the situation whereby if they turn up to work they are paid less than a person who takes the day off. That was the example—was it not, Helen Duncan—that we were given in the select committee. In fact, we were told that there are chains in our freezing works that have not been able to work because absenteeism is so bad. Export orders, which are vital to this country, have been lost because of this legislation. Is that not correct, Helen Duncan?

Helen Duncan: Rubbish!

Hon RICHARD PREBBLE: Is she saying that the meatworks were lying, or was she not listening?

HELEN DUNCAN (Labour): I move, That the question be now put.

Dr WAYNE MAPP (National—North Shore): I want to explain in more detail the issues around relevant daily pay, because they are absolutely crucial. The member across on the Government side of the Chamber is interjecting, but she has not understood that the concept of relevant daily pay includes things that are beyond ordinary pay. That is the real issue—they are beyond ordinary pay. They include productivity and incentive claims. Even if the person does not actually earn them, the person gets them. They include commissions, payments for overtime, and cash values for board and lodging. We do not have a problem with the latter point, but productivity and payments for overtime are where the problem lies. It is worth noting, and, in fact, it must be stressed—and the member who is interjecting obviously has no understanding or appreciation of this—that the bill introduced by the Labour Government in 2003 by the well-known socialist Margaret Wilson had that concept contained in three clauses about ordinary pay. Clause 7 was about the meaning of ordinary pay, clause 8 stated that ordinary pay included the cash value of board and lodgings, and clause 9 stated that ordinary pay did not include certain payments—specifically, overtime and bonuses. Those things were excluded by the bill introduced by the Labour Government, and it is worth remembering that.

But the unionists got control of the legislation, and I guess the truth of the matter is that people like Helen Duncan got the new concept of relevant daily pay, which includes incentives, bonuses, and overtime. [Interruption] The member interjects and says that it does not, but she should read the legislation, which shows it clearly does. There is no question about that, whatsoever. So that is why I have chosen not the 1981 Act but the Government’s very own proposition as the basis for my Supplementary Order Paper 278. The Government knows full well that that is where the problems lie; we only have to look at the submissions on the bill to see that.

In the submission from Heinz-Wattie, for instance, it could not be clearer that relevant daily pay, as legislated for in section 9(1) and (2) of the Holidays Act “is not workable” in a large enterprise. That company could not have put it more directly or simply than that. It gave the Transport and Industrial Relations Committee working examples, such as one that if the ordinary rate is $23 an hour, because of the way the calculations are done under the new regime people can be paid $82 per hour—not $23 but $82. That is absurd, and that was the point that Heinz-Wattie brought to the attention of the select committee.

But the Government just ignored Heinz-Wattie. Labour people asked what was wrong with that, and said there was nothing wrong with it. They wanted to justify the absurdity that people who are sick are paid more than people who are working. I mean, when we distil it down, that is what it actually means. That is why business, when given the opportunity to make submissions, pleaded for a return to what was introduced by the Government in 2003. The member across the Chamber, Ms Duncan, said that that was boring. That shows the contemptuous attitude of Labour to business. When business and employers were given the opportunity to make their submissions, I guess that the Government was hoping they would say that they supported this bill. They did not say that; they asked for the real problem to be fixed up. And that is the problem United Future has, has it not? Its members say that an elephant has to be eaten one bite at a time, and that therefore they will support this bill. How many bites would it take to eat an elephant? I guess we would be on the “Holidays Amendment Bill 3049” before the legislation was fixed.

Hon TAITO PHILLIP FIELD (Minister of State): I move, That the question be now put.

PETER BROWN (Deputy Leader—NZ First): I raise a point of order, Mr Chairperson. I do not know whether I am correct, but I understand that you must take calls in proportion to the parties’ size in Parliament. New Zealand First has had only one call in this debate, and I think my National Party colleagues have had far more than two calls.

The CHAIRPERSON (H V Ross Robertson): I thank the honourable member for his contribution, and suggest to him that he look at Speaker’s ruling 59/2, which states that proportionality applies principally to fixed-time debates. I had been watching the member carefully, to see whether he sought the call. He had not called for some time. He rose last time, yes, but he did not call to speak. I refer him to Speaker’s ruling 24/4 from Speaker Wall.

PETER BROWN: I raise a point of order, Mr Chairperson. Frequently the Chairperson shuts members down or stops debate because it is repetitive. I have heard that many times from many chairpersons. I have refrained from taking a call until something new has come up that I believed I could comment on. I wanted to comment on aspects of this bill that are new—that have not been commented on.

The CHAIRPERSON (H V Ross Robertson): I thank the honourable member. I have already taken the closure motion, but I can assure the member that he will be given every consideration in terms of the next part.

A party vote was called for on the question, That the question be now put.

Ayes 61

New Zealand Labour 51; United Future 8; Progressive 2.

Noes 58

New Zealand National 27; New Zealand First 13; Green Party 9; ACT New Zealand 8; Independent: Awatere Huata.

Motion agreed to.

The question was put that the following amendment in the name of the Hon Paul Swain to clause 2A be agreed to:

to insert, after the word “entered” in the definition of existing individual employment agreement, the word “into”.

A party vote was called for on the question, That the amendment be agreed to.

Ayes 83

New Zealand Labour 51; New Zealand First 13; Green Party 9; United Future 8; Progressive 2.

Noes 37

New Zealand National 27; ACT New Zealand 8; Māori Party 1; Independent: Awatere Huata.

Amendment agreed to.

The question was put that the amendment set out on Supplementary Order Paper 278 in the name of Dr Wayne Mapp to insert a definition of ordinary daily pay in clause 2A be agreed to.

A party vote was called for on the question, That the amendment be agreed to.

Ayes 49

New Zealand National 27; New Zealand First 13; ACT New Zealand 8; Independent: Awatere Huata.

Noes 62

New Zealand Labour 51; Green Party 9; Progressive 2.

Abstentions 8

United Future 8.

Amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 278 in the name of Dr Wayne Mapp to add new subclause 2 to clause 2A be agreed to.

A party vote was called for on the question that the amendment be agreed to.

Dr Wayne Mapp: Disgraceful!

The CHAIRPERSON (H V Ross Robertson): The member should know that it is highly disorderly to interject when votes are being cast. It can actually be seen as a form of intimidation, and can ultimately amount to a breach of privilege.

A party vote was called for on the question, That the amendment be agreed to.

Ayes 49

New Zealand National 27; New Zealand First 13; ACT New Zealand 8; Independent: Awatere Huata.

Noes 62

New Zealand Labour 51; Green Party 9; Progressive 2.

Abstentions 8

United Future 8.

Amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 278 in the name of Dr Wayne Mapp to clause 3 be agreed to.

A party vote was called for on the question, That the amendment be agreed to.

Ayes 49

New Zealand National 27; New Zealand First 13; ACT New Zealand 8; Independent: Awatere Huata.

Noes 62

New Zealand Labour 51; Green Party 9; Progressive 2.

Abstentions 8

United Future 8.

Amendment not agreed to.

The CHAIRPERSON (H V Ross Robertson): Now we have an amendment in the name of the honourable member Dr Wayne Mapp to insert a new clause 3A. I have to rule it out of order, as it is inconsistent with the previous decision. The next amendments are to clause 4, and also are in the name of the honourable member Dr Wayne Mapp. The two amendments are set out on Supplementary Order Paper 278. Those amendments are also out of order because they are inconsistent with the previous decision.

The question was put that the amendments set out on Supplementary Order Paper 277 in the name of Paul Adams to clause 4 be agreed to.

A party vote was called for on the question, That the amendments be agreed to.

Ayes 17

ACT New Zealand 8; United Future 8; Independent: Awatere Huata.

Noes 102

New Zealand Labour 51; New Zealand National 27; New Zealand First 13; Green Party 9; Progressive 2.

Amendments not agreed to.

The question was put that the following amendment in the name of Peter Brown to insert the following new clause be agreed to:

7A Notwithstanding anything in section 51 or any other section of the principal Act, nothing shall preclude an employer and an employee (or their respective representatives) from negotiating an employment contract, based on an annual salary, which includes a provision for working none, some or all public holidays without any further remuneration.

A party vote was called for on the question, That the amendment be agreed to.

Ayes 49

New Zealand National 27; New Zealand First 13; ACT New Zealand 8; Independent: Awatere Huata.

Noes 70

New Zealand Labour 51; Green Party 9; United Future 8; Progressive 2.

Amendment not agreed to.

A party vote was called for on the question, That Part 1 as amended be agreed to.

Ayes 61

New Zealand Labour 51; United Future 8; Progressive 2.

Noes 59

New Zealand National 27; New Zealand First 13; Green Party 9; ACT New Zealand 8; Māori Party 1; Independent: Awatere Huata.

Part 1 as amended agreed to.

PAUL ADAMS (United Future): Can I amend the United Future vote on Wayne Mapp’s amendments? I should have called “abstention” on the first two instead of “for”. I seek leave to amend the vote.

Lindsay Tisch: I raise a point of order, Mr Chairperson. I just want clarification. Dr Mapp had a number of amendments, and I am wondering which ones the United Future member is referring to.

The CHAIRPERSON (H V Ross Robertson): My understanding is that he is referring to both the amendments to clause 2A. Maybe the member would explain.

PAUL ADAMS: Our abstention vote would be for all of Wayne Mapp’s amendments.

The CHAIRPERSON (H V Ross Robertson): You have abstained on one of them, to clause 3. The member is seeking leave. Is there any objection to that course of action being taken?

Hon Richard Prebble: I raise a point of order, Mr Chairperson. I just want an assurance from the member that he genuinely did intend to abstain all the way through, and that he did not have a flash of inspiration as the voting was going on, because in that case it would be improper for him to ask for the record to be changed. One cannot change one’s mind. If he could tell members that he had an instruction to abstain all the way through, that is a different matter. But I think members need to have that explanation made to the Committee.

PAUL ADAMS: That is correct. I did have instructions to abstain all the way through.

The CHAIRPERSON (H V Ross Robertson): We will take the member at his word. The leave has been agreed, so the voting list will be changed. For the first vote on Dr Mapp’s amendments to clause 2A, the Ayes are now 49, the Noes are 62, and the Abstentions are 8. For the second vote, the Ayes are 49, the Noes are 62, and the Abstentions are 8.

Part 2 Amendments to principal Act relating to sick leave and bereavement leave

Dr WAYNE MAPP (National—North Shore): I guess the Government will seek the assistance of its coalition partner, which no doubt will boldly sally forth and vote for this bill. One of the measures of being in this Parliament, particularly for a common-sense party, is whether one can vote “Yes” or “No” to things. Abstentions do not seem to me to be a common-sense approach. We are put in this Parliament by the voters of New Zealand to make up our minds. I would have thought that was a pretty obvious, common-sense approach. [Interruption] Well, I suppose that is really the point, is it not? Common sense does imply that one has a mind to make up, as my colleague Maurice Williamson just said. The “common-sense party” apparently has no mind.

Hon Maurice Williamson: Mindless!

Dr WAYNE MAPP: Mindless! Therefore, it abstains. Will it abstain on this part? This is another part in which the Government states that it is fixing up the problems of the Act. What it is actually doing is loading costs on to employers. That is what it is doing.

The Minister of Labour will say that the Government is making it easier for employers, in that if an employer suspects that an employee has been untruthful in claiming sickness, the employer can demand a medical certificate. On the face of it that sounds reasonable. There is a sting in the tail, though: the employer has to pay. We know how much medical certificates cost. They cost at least $50, and in many cases $60 or $70. The Government knows perfectly well that in many cases it simply will not be worth it for the employer to make that request. So it has given a remedy that is no remedy at all. It has said that here is a reasonable measure—the sort of measure, I guess, that United Future might support—

Hon Maurice Williamson: If they could make up their minds.

Dr WAYNE MAPP:—if those members could make up their minds—but it has made it nugatory by adding the provision that the employer has to pay for it.

That is the sort of thing we expect from “Swainy and the boys”. He is a man who goes out and pretends to be the friend of the employer. In fact, he is not. His background and his record are as a dyed-in-the-wool unionist. He acts here, fundamentally, under the direction of ideology driven from his union past. All the honeyed words we hear from that man—that he is a friend of the employer—are completely false, because, in fact, whenever he is given a choice, he harkens to his union background. That is true in this bill and it will be true in the next bill.

That is why we see this vicious sting in the tail. The Government renders this part completely pointless by making the employer pay for the medical certificate. It is not as if the employers of New Zealand do not have enough compliance costs. This Government, after all, has gone out of its way to load compliance costs on to employers. All the provisions in this legislation and in the Holidays Act add costs on to employers. All the Government’s union-based legislation—the Employment Relations Act and the amendments to it that we will be dealing with later—adds costs on to employers. All the Government’s taxes—about 23 new taxes on employers—add costs to employers. Today the Government is asking Parliament to vote for another additional cost on employers.

I want to hear from United Future whether it will support this bill. Will United Future support this legislation? Every indication we have had so far is that it will support it. It has said that it is part of its magnificent meal of an elephant—one bite at a time. A meal of an elephant—large beast that it is—requires about 3,000 bites. United Future will give the Government 3,000 opportunities to fix up the legislation.

Dr the Hon LOCKWOOD SMITH (National—Rodney): In speaking to Part 2 of the Holidays Amendment Bill, I say to the Minister in the chair, Paul Swain, that I have now been in this place for 20 years and not often have I seen such ridiculous law before Parliament. I invite members to reflect on what Part 2 actually states. It states that if a person has agreed to work on a public holiday but does not actually work on that public holiday, that person is entitled to be paid as if he or she had worked on that day. That is about as dopey and as stupid a provision as I have ever seen in this Parliament. What on earth are we trying to do here? I presume this Labour Government wants to make sure that people who do work on public holidays get paid extra for it. OK, that is Labour Party philosophy. It will not allow employees and employers to negotiate what they will agree to and sort out their own arrangements. It will not allow that. It will insist through law that people get paid extra to work on public holidays. OK, I kind of accept that dopey Labour Party doctrine, but still, Part 2 goes a whole step further than that.

Part 2 states that a person does not actually work on a public holiday—he or she might have been sick—to get paid as if he or she did work on the public holiday. That is ridiculous. If people did not work, why should they get paid as if they had worked? I thought the whole idea of this bill was to pay people who do work on a public holiday some more. If one is at home with the kids in front of the television—maybe with a headache or something—on a public holiday, why should one get paid more? I want the Minister to explain that to members. As I read Part 2, it appears that new section 61A, inserted by clause 8, requires an employer to pay someone time and a half even if that person does not work on a public holiday. A person might have been asked to work on a public holiday but then turned round and said: “I can’t because I’m sick.” So the person is at home with the family and the kids—and this Minister expects an employer to pay that person time and a half, based on relevant daily pay. I ask the Minister to reflect on the fundamental stupidity of that.

What in God’s name is driving politicians to think that that is sensible law? What is the next step that this Government and this Minister will take with our employment law or Holidays Act? What will be the next kind of stupidity proposed? I cannot think of something more stupid than this—and of course, once we go down that track, we have all the paraphernalia in clause 9 about medical certificates and the like, and about trying to prove whether someone was sick. The simple matter is that if people do not work on a public holiday, why the hell should an employer have to pay them as if they had worked on a public holiday? Why does this Government hate employers so much? Why does this Minister want to cause employers so much hassle? It is employers who provide the livelihoods for the Minister’s union mates. It is employers who provide those livelihoods. They risk their money. They invest in the business. Where is the logic in saying: “If you don’t work, we will still pay you time and a half if you are at home with your feet up in front of the fire.”? It is patently absurd.

Jill Pettis: How dare workers sit in front of the fire!

Dr the Hon LOCKWOOD SMITH: I have no problem with workers being at home in front of the fire. My problem is the law of this Labour Government that forces employers to pay them time and a half to be at home with their feet up in front of the fire. That is the absurdity. I invite the member to think about it. If employers are meant to pay people to work on a public holiday, that is one thing, but to pay them to sit at home is patently stupid.

Hon PAUL SWAIN (Minister of Labour): I am required to make a very small contribution in reply to that member, because if he were to read clause 8 of the bill he would see that the employee is not entitled to be paid at time and a half. It is quite clear in the legislation. That is one of the reasons we are doing this. It was one of the criticisms that if someone were sick on a public holiday and at home, that person could be paid at time and a half. The legislation cannot be any clearer than this: the employee “is not entitled to be paid at time and half”. It cannot be any clearer than that.

If we are reduced to having a debate in Parliament where not only do members not read the bill but they do not understand it, then there is very little point in us carrying on with the discussion. I urge members to read the bill before they get to their feet.

PETER BROWN (Deputy Leader—NZ First): I listened with interest to the Hon Lockwood Smith. I thought he was wrong, and I am grateful that the Minister has taken a call to explain that because, in fairness to the Transport and Industrial Relations Committee, we went to a great deal of time and trouble to make sure we got this bit right. If we did not—

Dr the Hon Lockwood Smith: Then why do we need all these clauses then if they are not entitled to be paid at home? Why do we need all this junk?

PETER BROWN: Maybe I can explain it. As I understand it, a person who works on a public holiday gets time and a half at his or her hourly rate, plus the industry allowances on top, plus another day off at the appropriate rate of pay. A person who does not work on a public holiday gets paid the relevant daily pay and does not get another day off in lieu. So there is quite a difference.

Dr the Hon Lockwood Smith: Why do they get paid if they’re not working?

PETER BROWN: Everybody gets paid for a public holiday if they are not working. They do now.

Dr the Hon Lockwood Smith: Why do we need all this? That is my question.

PETER BROWN: I think that that is a reasonable question. I think the reason we need all this legislation is that previous legislation made a muck of it, so we have the amendment bill to make sure that the law does not continue as it is.

New Zealand First is reasonably comfortable with Part 2. We have some reservations about the employer having to pay for the doctor with regard to sick leave, but we think that in the circumstances that is not untoward.

I would like to seek the Chairperson’s indulgence, because he stopped me from having the call. It added to my anguish when my colleague in United Future abstained, because I thought that my 5 minutes would have convinced him one way or the other. I want to say to that honourable member in United Future that although I cannot wind the clock back to when we were debating Part 1, as he well knows, I know he has concerns about relevant daily pay. Nobody abstains in this House if they do not have some concerns. I say to him that if United Future had voted against it, the vote would not have been carried and we could have sorted it out. If the member had been prepared to say to the Government that this bill was not correct in its entirety and that he had some real concerns, then we could have sorted it out and New Zealand—all working New Zealanders and all New Zealand employers—would be the better for it. If this bill goes through with United Future’s support, it will be rectified only in part.

There is still more to come. My colleagues and I will have a very strong debate on whether we will support the third reading, and I can tell members that now. We realise there are some flaws in the Holidays Act 2003 that have to be addressed. This bill will address only some of them.

United Future has missed the opportunity—and I am speaking seriously now—of getting this whole thing tidied up fairly and squarely, and once and for all. United Future should have considered saying to the Government that it would put a stake in the sand, and that it would not support this bill unless it were properly tidied up in the interests of everybody in this country—workers and employers. That opportunity will not come again. So because the Chairman did not allow me my second call, I will never know now whether I would have convinced the honourable member to show at least a bit of strength of character, to put a stake in the sand, and to say: “We stand for something in this place. We do not just make hollow noises and roll over.”

As I said, Part 2 sits more comfortably with New Zealand First than Part 1. We had an opportunity to address Part 1 by accepting Wayne Mapp’s Supplementary Order Paper and, indeed, the Supplementary Order Paper I put forward would have addressed the salary concerns that John Key touched on earlier.

PAUL ADAMS (United Future): I rise on behalf of United Future to speak on Part 2, but I will first address Lockwood Smith’s comments. He made a statement that employers hate this Government. Well, I speak to a lot of employers out there, and to be honest they do not hate this Government. Their businesses are going very well and the economy is ticking over, so I think it is very bland to come here and make the statement that many employers hate this Government. They may be concerned with some aspect of the legislation, but to come out and say that they hate the Government is, I think, a mistruth.

I come back to Part 2. United Future will support this bill because, let us be honest, each party—whether it is Labour, National, or whatever—has a voter or client base. From the centralist position that United Future intends to steer down, we can listen to Labour’s concerns and begin to understand some of the reasons why it cannot amend this legislation at this time to the degree we would like. Likewise, National has to stand against some of those things because of its voter base. Our position is right in the centre and we will—

Hon Roger Sowry: What are they?

PAUL ADAMS: I would ask Mr Sowry the question: does this amendment improve the Holidays Act that was passed last year, or not?

Hon Roger Sowry: No, it doesn’t.

PAUL ADAMS: Well, the member is obviously not talking to anybody in the business community, so everything else he said in his speech must be an absolute waste of time. If he was talking to them, he was not listening to them.

Part 2 allows the employer to check whether his employee is genuinely sick. I do not think that anybody in the House would disagree with that. We know, because of human nature, that employees are not always honest. So if there seems to be a pattern to the days an employee takes off, the employer can now have the opportunity to ask for and expect to get a medical certificate. I think that is very good.

The other thing that concerns me about a lot of the speeches I have heard in the Chamber with regard to this legislation, is that anyone would tend to think that this was the bill bringing in relevant daily pay. Well, this is not the bill that brings in relevant daily pay. The legislation that was passed in 2003 brought in relevant daily pay, and United Future voted against that legislation. In fact, if members went back to Hansard they would see that United Future brought up many aspects during that debate that are very relevant to what we are dealing with today. But United Future has a backbone and is big enough to recognise that when improvements are made, it should accept them and move forward. So United Future will support this legislation, and is proud to do so.

Hon RICHARD PREBBLE (ACT): I rise on behalf of the ACT party to tell United Future members and Parliament that we are totally opposed to this part, and I will set out the reasons. Firstly, the Government has no business telling employers and employees about their arrangements with regard to whether one should have a medical certificate. That is a matter they can organise between themselves.

Let me just give a simple example. My first job was as a law clerk. Before that I had been a student, and when I did not feel too good, for a variety of reasons, I used to skip a lecture. When I was a law clerk I did not feel too good one morning, so I rang up and called in sick. I was staggered when the senior partner of the firm—and it is a bit hard to explain this to everyone, but he was a senior partner—rang me and expressed great concern about my health. He said to me: “I insist you go to the doctor.” I told him that I was not that bad. He said: “I know that you are a conscientious worker, Richard. If you’re too ill to come to work, you definitely need to see a doctor. It is the company’s policy. You must see a doctor because we want you to be in good health.” Well, I got the message, and I never took another sick day.

As an employer, I have always done that. Even previously, when I was the leader of ACT, if any of my people were sick I used to ring them at home, express great concern about their health, tell them I knew how conscientious they were, and say they had to go and see a doctor. It is actually very good advice, especially for young men, because they frequently do not go to doctors when they ought to. But this bill makes that sort of arrangement impossible. Why is the Government interfering in that?

I say something else to Government members opposite. They may not realise it but a lot of good employers do not give only the number of sick days the bill is talking about. In firms I have been a director of, we have had unlimited sick leave. I know that trade unionists opposite might not think that that is so, but I remember that in one particular firm, when we had a woman who was ill for 6 months, we paid her for every single day. Why did we do that? We were a conscientious firm and we ran as a family. People knew that we would back them, but we expected them to work every day. We did not have people with “Mondayitis”.

This bill treats us all like infants—and United Future is voting for it! Well, United Future members have actually voted for it, voted against it, and abstained. That is what they have done, so that they can tell anybody who asks them what they think about the holidays legislation. If it is the trade union, they can say they voted for it. When they see an employer they can say they were against it, and if they run into a journalist they can say they abstained. They did the lot.

I personally have never been in favour of abstentions. In the great Parliaments of the world—the House of Commons, the US Senate, and the Congress—members cannot abstain, because they know that that is where the buck stops. They either have to be for the legislation or against it. I, like St Paul, have the lowest opinion of people who are not for or against but who just abstain. As St Paul says, one should spit them out. That is what I think people will do to United Future, and that is what we should do to this bill.

This is a trade union bill. It is actually worse than that. This is a bill where the Labour Party is buying off its trade union mates—buying support at the expense of New Zealand small business. It is a dreadful bill, and we ought to vote against it. We ought to throw this bill out. It will not help labour relations; it will not create a healthy New Zealand; and it will not create a prosperous New Zealand. It is there purely for party, political, partisan reasons. It is actually a pay-off to the trade union movement for its support in the last two elections.

A strong Parliament and a strong United Future party—which said it was going to keep people honest, lift the standard of debate, and bring some integrity into this Parliament—would vote against this bill. Yet its members get up here and say they will vote for it because politics is all about voter-based support. That is what Mr Adams said. He said it was all about appeasing his voter-based support. I ask the member: what happened to principles?

KEITH LOCKE (Green): I have the opposite view from that of my colleague Richard Prebble, in that I think this is an accommodation to those employers who want to restrict sick leave. Under the bill prior to this amendment, 5 days’ sick leave is laid out and an employee can have the first couple of days without providing a medical certificate. This provision allows the employer to demand a medical certificate for the first 2 days, and it needs to be requested only on vague “reasonable” grounds. This provision will actually have the net effect of making employees sicker. That is the reality, and I have experienced that in the past in different jobs.

When people are required by their employer to provide a medical certificate for the first day they are sick, they only get sicker, because they have to struggle to go out. I am a case in point. When I start feeling a bit sick, I try to rest. I try to stay in bed for a while hoping my immune system will come into effect and overcome the oncoming disease, and hoping not to be out of circulation for more than a few hours or a day. If I had to struggle out in the cold to see the doctor, I would get sicker. If people have to go out in the cold, catch a bus—a lot of poor people do not have their own transport and have to wait for a bus—get to the doctor’s surgery, wait for an hour for the doctor, and then struggle home again, that just makes them a lot sicker in circumstances where they would be better off staying at home. That is the very damaging part of this whole business, and there is no need for it.

There has been a lot of discussion about people taking lots of sick leave. There are only 5 days’ sick leave in the legislation, and the employer can already demand a medical certificate for the third and subsequent day. Of course, the agreement between the union and the employer may involve more sick days—indefinite, as Richard Prebble has just mentioned, or 10 days or 8 days or whatever—but this amendment applies only to the first 2 days to allow the present provision to remain, and it would not lead to any great problems in our society. It would not make people more sick in the way that this amendment will. There are all the other issues about whether the employer will bear reasonable costs relating to the employee getting a medical certificate. That still presents a lot of potential unnecessary argument between the employer and the employee about what are reasonable costs, whether it involves the full medical fee or part of it, whether the appointment was for the particular sickness or other matters, the prescription cost, the cost of travel to the doctor, or whatever. One could get into innumerable arguments that we would not really want to get into. Those arguments could be avoided by allowing the present provision to remain without the requirement for a medical certificate.

I also think that giving that leeway is a question of respect—the respect of the employer for the worker. What are reasonable grounds? Is the legislation saying that just because someone has been off for a couple of Mondays, and off on the next Monday, then definitely that is reasonable grounds? I do not think one has to get into that. Sure, if an employee has a longer sick period—10 days, perhaps, in terms of an agreement between the worker and the employer—and the employee is off for a series of Mondays, sure. Even now employers can refuse to pay the sick pay if they clearly see that the worker is not sick and if they have evidence. If a worker phones up sick, and then the employer sees him on the TV that night playing a rugby game during the day that he said he was too sick to get out of bed, then the employer would not have to, by law, pay the sick pay anyhow. So there is no particular problem there. It does not avoid the situation that Richard Prebble just referred to of the employer phoning up and expressing concern. That can still be done. But that employer does not have a right to instruct an employee. If the employee describes to the employer that he or she has spots, which would be serious enough to go to the doctor, then a good employer could recommend that the employee go to the doctor. But this legislation means that there is not a requirement for the employee to go to the doctor if told to by the employer.

Sitting suspended from 6 p.m. to 7.30 p.m.

Hon ROGER SOWRY (National): The Minister told us that Part 2 would deal with the issue around the huge rise in sick leave and bereavement leave taken since the Holidays Act was passed by the Labour Government last year. The Holidays Amendment Bill was sent to the Transport and Industrial Relations Committee, but industry groups were not allowed to just come along and make submissions. The Labour Government said it would listen to only a select number of businesses. Half a dozen of them turned up—namely, Air New Zealand, Business New Zealand, Carter Holt Harvey, the meat industry, Heinz-Wattie, the Retailers Association, and the Hospitality Association. They all said that this bill will not work. In fact, the meat industry arrived at the select committee with some statistics that show that the average number of sick days taken—and the cost of those sick days—has increased by 70 percent since Labour made a botch-up with the Holidays Bill, which it passed last year. Bereavement leave, or tangi leave, is up by 30 percent since Labour made a botch-up with its legislation last year. But that is not a rise of 30 percent in a year, or in 6 months. That is a 30 percent rise in 2 months. That is the sort of increase in sick leave and bereavement leave that has been going on.

The Holidays Amendment Bill went to the select committee, and every group, bar the trade unions, opposed the bill. Every party on the select committee, bar the Labour Party, opposed the bill. So the Labour Party reached out to United Future, who was not on the committee, who heard no submissions, and who did what United Future members do best—that is, roll on their backs when the Prime Minister tickles them. They have decided to come into the Chamber and support the bill. But they support only a little bit of it. They abstained earlier today on some parts. They said that they had voted against the bill last time—that is, last year—but that this year they would vote for it.

Over the dinner break I had the opportunity to talk to some of the business groups around the country, and it is fair to say that they want to know why United Future members have changed their minds. Well, what we have found from their own words is that they have changed their minds to allow this bill to go through and to support the changes, which, I point out, do nothing to solve the issue around sick leave—nothing at all; not a thing. The bill says to an employer: “If your staff member is sick, you can ring them and tell them to go and get a doctor’s certificate, but you have to pay for the certificate.” But what does the employer do if the staff member says: “I couldn’t get into the doctor.”, or “I don’t have a car and can’t get there.”?

Darren Hughes: What do employers do now?

Hon ROGER SOWRY: Well, they cannot do anything now. The member should know that they cannot do anything now.

This bill will not solve any of the industry groups’ problems. They all came to the committee and said that this bill will not work. Can United Future tell us of one business grouping or one major employer they have talked to who has said: “Good on you!” when they were told that United Future was going to vote with the unions and Labour? In all good Christian conscience, can they give us one name? No, they cannot give us any.

Paul Adams: What’s wrong with your conscience?

Hon ROGER SOWRY: The member need not tell me what is wrong with my conscience, because I tell people when they come into the office what I am going to do. I do not do what the member for United Future does, which is sit in the office and not say anything. He does not say a word about what his real motives are. What is that member’s name; I cannot remember?

Opposition Members: Paul Adams.

Hon ROGER SOWRY: Why does Paul Adams not tell business what he told the House today? In fact, I ask him whether he will do that.

Paul Adams: No problem.

Hon ROGER SOWRY: OK. Will he talk to business about his support for this bill?

Paul Adams: No problem, at all.

Hon ROGER SOWRY: He will do it this week?

Paul Adams: No problem.

Hon ROGER SOWRY: If they ring him and want to see him tomorrow, will he see them?

Paul Adams: Not a problem.

Hon ROGER SOWRY: That is good, because they will be doing that. I predict that Mr Adams will come in and say: “Well, the best we could get from Labour was this.”, and “If we didn’t do this,”, and “We could have gone a bit harder, I guess.”, and “But no, no, we’re really on your side. It’s OK, it’s fine, don’t worry.”—the same sort of weasel words we hear from United Future all the time. I predict we will hear that again. In fact, we got an inkling of that earlier on when Mr Adams stood in the Chamber and said: “I abstained on this, so we are neither for nor against some aspects of Part 1, like ‘relevant daily pay’, and on the part relating to sick leave we are going to vote for this but on the other part—”

Paul Adams: I raise a point of order, Mr Chairperson. We did not abstain on Part 1, so what the member is saying is also incorrect.

The CHAIRPERSON (H V Ross Robertson): That is a debating point, and if the member claims he has been misrepresented, he should not raise his point of order until the end of the member’s speech.

Hon ROGER SOWRY: The member is right; he actually voted on it and then when it was safely passed and he realised he could have abstained, he took a point of order and abstained. He did not march with his conscience and abstain; he did it only after he had checked the numbers to make sure the amendment was going to be defeated. That is a great thing! No wonder Mr Blumsky said that he could not enjoy a beer with them! The Minister in the chair, the Hon Marian Hobbs, is going to feel the wrath of that man. In fact, the Minister will be having her fair share of sick days under this legislation, as she feels cold steel during the election campaign that is coming up.

I want to talk about the issue that is not dealt with in Part 2, and that is a bit odd because I know we are meant to debate only what is in Part 2. But when we talk about sick leave in employment terms it is always grouped with bereavement leave. In fact, section 72(2) is amended by clause 10 by inserting the words “without reasonable excuse,”. But what is a reasonable excuse? All of the onus in this legislation has been put on the employer. The employer is going to be placed in a very difficult position in respect of tangi leave. The person fronts up and says: “I have to take leave for a tangi. I have to speak on the marae. It’s part of my role to do the kōrero”. So the person takes leave; that is it. The employer will end up paying for it. Is that fair? Of course it is not fair.

Darren Hughes: How is it different for the Anglican Church?

Hon ROGER SOWRY: The difference is when one has to take a reasonable part in a funeral that occurs only on a marae. What happens is that the Anglican Church uses ministers. They do not just use the chap off the construction site to take a reasonable part, unless one is carrying the casket out, and if one is doing that, so be it, as one is probably relatively close to the victim. This is all the ceremonial stuff, and Mr Hughes knows that. Employers have told him that. He goes one step further than United Future and says: “I’m on the right wing of the Labour Party. I don’t have to agree with all of this.”—but he does not vote that way. He says: “I’m a supporter of Phil Goff. One day he will be the Prime Minister.” That is his mantra as he travels around.

JOHN KEY (National—Helensville): Firstly, I congratulate you, Mr Chairperson, on giving my colleague the Hon Roger Sowry additional time for his contribution. It was a wonderful contribution from a member who understands this legislation. I could see outrage on Government members’ faces when they finally realised what, tragically, they were trying to pass through the Committee tonight.

Dr Wayne Mapp: And fear!

JOHN KEY: Yes, and fear. I wish to raise four elements in this debate, in no particular order. The first is the contribution made by Mr Locke of the Green Party. He made a very interesting observation in his 5-minute address. He said exactly what Labour Party members on the Transport and Industrial Relations Committee said: “It doesn’t matter whether employees take a day off on a Monday because they have only 5 days, so how bad can it get if they take five Mondays off?”. Following on from that statement he came out with quite an extraordinary statement, actually, when he said: “It doesn’t matter if they get a disease that affects them on a Monday, every Monday. It will be OK, because it’s not that big a deal.”

Of course, Mr Locke did not have the opportunity to sit on the select committee, and to hear when that issue was raised that it was quite correctly pointed out—I think by Mr Sowry, and maybe by others—that employees will bank holidays and carry them forward, and that they may not use those sick days until they are in a period where they may be finally leaving the company, so they will lose their holidays and sick pay and take those days as sick days every Monday instead. My first point, therefore, is that I think Mr Locke’s comment about the 5 days is a bit erroneous.

The second point I wish to raise is that in some respects this bill is a bit of an Italian opera. It is a real tragedy, is it not? It is a tragedy because United Future members will vote for this legislation tonight because they believe it is right, and because they think the Government really supports it. What a tragedy that is. They believe the Government really supports the legislation.

The Government does not support it, at all. We sat on that select committee and employer after employer said: “You can’t possibly have 3 days before you require a medical certificate. You’ve got to have it for 1 day if it is required.” But the Government said that no employee will abuse the system: “It does not matter whether it is 5 days or 4 days, but 3 days is just us being generous. It doesn’t matter.” The Government does not believe in this legislation.

There is only one reason, and one reason alone, why this legislation is going through the Committee tonight, and that is quite an unrelated issue. It is all to do with a speech given by the Leader of the Opposition, Don Brash, in Ōrewa in January this year. That is why this legislation is going through—and the Minister has looked up now and his eyes are looking over at me. He is very interested in this point, which is a very valid point indeed.

The CHAIRPERSON (H V Ross Robertson): Part 2.

JOHN KEY: The reason why Part 2 of this legislation is going through the Committee is because in April this year the Government was looking down the barrel of some very poor poll results. It was entering its second winter of discontent, and the polls said that it had to move. I say to Mr Chairman, who is asking me to come back to Part 2, that that is a very valid point. The Government had to try to window-dress those issues. So the Government rolled in Paul Swain, the business-friendly Minister—

Simon Power: The “Minister of Lunches”!

JOHN KEY: Yes, the “Minister of Lunches”. The Government rolled him in and got rid of Margaret Wilson. She was made the “Minister of Nowhere”. The Government said that Paul Swain would provide the softer side.

I have no doubt that Paul Swain believes in the legislation, as does Phil Goff, John Tamihere, and probably Damien O’Connor and Clayton Cosgrove. And that is it: five of the Government’s 52 members believe in the legislation; the rest of them do not believe in it.

However, United Future members are voting for it. They think the Government agrees with it because the Prime Minister has gone over, tickled their tummies, and said: “Vote for this! We’re all in favour of it.” However, the Government really is not. The legislation is here for one reason, and for one reason alone—because of the winter of discontent.

Hon TAITO PHILLIP FIELD (Minister of State): I move, That the question be now put.

A party vote was called for on the question, That the question be now put.

Ayes 71

New Zealand Labour 51; Green Party 9; United Future 8; Progressive 2; Māori Party 1.

Noes 49

New Zealand National 27; New Zealand First 13; ACT New Zealand 8; Independent: Awatere Huata.

Motion agreed to.

The CHAIRPERSON (H V Ross Robertson): The question was put that the amendment set out on Supplementary Order Paper 277 in the name of Paul Adams to clause 8 be agreed to.

Amendment not agreed to.

The CHAIRPERSON (H V Ross Robertson): The amendment in the name of Dr Wayne Mapp to insert new clause 11 is inconsistent with the previous decision on clause 3, so it is out of order.

Hon ROGER SOWRY (National): I raise a point of order, Mr Chairperson. I waited until you had put the amendments to raise this issue, because of course there is still an opportunity to debate a part, even though the amendments have been put, before you put the final motion.

I want to raise a really serious issue, because there are colleagues of mine who are very aggrieved by the rapid taking of the closure motion. I would like you to consider this issue: this bill went to a select committee but was not available so that members of the public could make a submission or be heard. In normal circumstances chairpersons have been a bit lenient, but we have not been given even 1 hour on this part, which is standard when the bill has been to a select committee. We have not been given the hour per part on an important part of a bill that was not open for everyone to make submissions, even though it went to the select committee. Only half a dozen groups were invited to make submissions.

I know you have put the amendments, and I know it would be unusual, but we have people who sat on the select committee who have not been given an opportunity to make a contribution. Mr Williamson was a member of the committee—in fact, he was the senior member of the committee. Our spokesperson on small business, who has been here all the time, has not been given an opportunity to speak. I think that perhaps you might reconsider before you put the part.

The CHAIRPERSON (H V Ross Robertson): I thank the honourable member. The member is of long standing and I appreciate what he had to say. He will also know that the acceptance of a closure is not debatable, but I have taken on board what he has said.

I did not see Mr Williamson calling. I am sorry but my vision was obscured. I will ensure that Mr Williamson is given the opportunity to take part in the debate on the next part.

LINDSAY TISCH (Junior Whip—National): I raise a point of order, Mr Chairperson. You have acknowledged that Mr Williamson was seeking the call. I have also been seeking the call on Part 2. We have been sitting through this debate from the start, we have been seeking calls, and you did give me a call on Part 1. Mr Williamson had a call on Part 1. However, it would have been appropriate for both of us to have a call, as we have both been here and we are interested in this legislation. As my colleague Roger Sowry has pointed out, we have a major contribution to make, having been involved in business ourselves, and representing business interests and employee interests. Unfortunately, we were denied the opportunity to take a call on Part 2, which is a significant part of the legislation.

We are now moving to the final stage, to the title debate, and I would seek your indulgence that you allow a wide-ranging debate, for the points brought up by Mr Sowry—that business did not get a fair hearing, and they wanted to make submissions. During the debate on the title and the commencement, which we are to have now, I ask that due consideration be given to a fair hearing from this side of the House.

HEATHER ROY (ACT): I raise a point of order, Mr Chairperson.

The CHAIRPERSON (H V Ross Robertson): I might add, honourable members, that the closure is not debatable. The Chair is the sole judge, under Speaker’s ruling 58/8. However, I am prepared to hear the honourable member.

HEATHER ROY: I reiterate the points raised by the National Party. I came to the Chamber at 7.30 to debate Part 2, which I believe has far-reaching effects on the health sector. As ACT’s spokesperson on health, I was certainly hoping to have the opportunity to debate some of the points that relate specifically to the health sector. I do not believe that anybody has raised those issues in this part. I came to the Chamber specifically at 7.30 to do that, and stood every time the call was to be taken. I have not been given the opportunity to speak.

The CHAIRPERSON (H V Ross Robertson): Can I say again that I have already ruled on this. The Chair is the sole judge, and I refer members to Standing Orders 137(3) and 138. I shall move on.

A party vote was called for on the question, That Part 2 be agreed to.

Ayes 61

New Zealand Labour 51; United Future 8; Progressive 2.

Noes 59

New Zealand National 27; New Zealand First 13; Green Party 9; ACT New Zealand 8; Māori Party 1; Independent: Awatere Huata.

Part 2 agreed to.

Clauses 1 and 2

PETER BROWN (Deputy Leader—NZ First): I raise a point of order, Mr Chairperson. I draw your attention to the fact that you have closed down both Part 1 and Part 2 with some dissatisfaction from this side of the Chamber. This bill appears to be getting through the Committee with the support of United Future. However, not only were its members not on the select committee, they did not hear any submissions, and, as far as I am aware, they did not speak to any of the submitters on this new bill. It is causing quite some concern that you are chopping the debate a little short, might I suggest. Therefore, I am asking you to be a little more tolerant concerning the debate on the title and commencement.

The CHAIRPERSON (H V Ross Robertson): I understand, and I thank the member for his points. I will certainly give them consideration.

SIMON POWER (Senior Whip—National): I raise a point of order, Mr Chairperson. We now have a situation where a senior member of the National Party has raised this issue, the junior whip has raised this issue, a member of the ACT party has raised this issue, and now New Zealand First has raised this issue with you. In the 5 years I have been here I have not seen that occur before in the Committee stage of a bill, where separate parties together have raised this issue with the Chair. I would urge you along the lines indicated by those who have already spoken to take very serious account of that.

Hon MAURICE WILLIAMSON (National—Pakuranga): In speaking to the title, I intend to range as widely as I will be allowed over the whole Holidays Act, because I am really perplexed about the support for it. We heard tonight in the debate on both Parts 1 and 2 of the bill from the United Future party that it opposed the original bill, and I am pleased that it did. I thought that the original bill was wrong. For the life of me, I still cannot understand why what someone is entitled to with regard to holiday regimes is not something that is a negotiable part of his or her contract, at least at a certain level. I can understand why a general workforce worker who is reasonably low in an operation, who does not have much bargaining strength, and who needs the union to support him or her maybe does need a back-up bill like this. But what happens when one gets into the senior management levels and people are quite senior in a company—and as we have heard, right up to the level of the chief executive of the biggest company in New Zealand—in terms of pay? Does this bill apply to such people? We have not actually been able to get that clear, but my colleagues are quite adamant that this legislation will apply to everyone. Someone can be on $2.something million a year and be the chief executive of a massive corporation, yet it is the Minister and the Government that will decide what that person is entitled to when he or she either works on a public holiday or is sick when he or she was scheduled to be working on a public holiday—and there are a number of permutations and combinations of that.

I go back to United Future, because I think its support for this legislation is most perplexing. United Future opposed the original bill, and its members came along tonight and said that they were not quite sure. They could not make up their minds, so they voted eight abstentions. United Future is obviously now the party that abstains on a regular basis. It had eight abstentions, and even had to take special calls later in order to get more abstentions added. Then United Future made the ridiculous claim that this bill was like eating a whole elephant by just taking one bite at a time. So we have an absolute white elephant on our hands. That is what United Future openly admitted the original bill was, and it voted against it. Now that its members are able to take one bite out of one piece of the elephant’s anatomy—and God knows whereabouts in the elephant’s anatomy they are getting to take that bite from—somehow they have a whole new lease on life. United Future’s argument is that because it can take a bite out of the elephant, it will support this absolutely pea-brained legislation.

I really, really want the Minister to take a call to tell us about the level that this legislation stops at within the workforce. If my colleagues are right when they say that it applies right throughout the entire working population that works for an employer, that is an outrage. I know that in a lot of companies the employment contract of a senior management person will have a range of specific provisions. The company may want to give such people a substantial amount of vacation as part of the package. It may want to give them a phenomenal level of remuneration as a straight, flat rate, and to say that that is it. The company may not even want to define how many hours such people are to be in, but to have a contract based on outcomes or outputs. But no, that cannot apply if we are to read this legislation according to the way it is worded. This Government thinks it knows what is best.

This legislation was all the creation of Margaret Wilson, who, by any stretch of the imagination—

Dr Wayne Mapp: She’s on the right.

Hon MAURICE WILLIAMSON: She is not on the right. She is not even on the left. Those on the left cannot find her, because she has gone so far off. Margaret Wilson’s views of the world in terms of Eastern Europe have been stamped “Best before 1990”. Even the Eastern Europeans do not believe in the stuff that Margaret Wilson believes in. I think that Kim Il-Sung, or whatever his name is, still does believe in it, and I think that Fidel Castro still does. They are the only two people who do.

John Key: No, Fidel Castro doesn’t.

Hon MAURICE WILLIAMSON: Has he given it up? All right, we are down to one. Margaret Wilson has one country supporting her view. It is no wonder the Prime Minister had to pull her out.

I have heard from the business community—from a number of people at the Employers and Manufacturers Association, and so on—that there is a bit of respite now. Paul Swain is quite sensible, they said. I said: “Yeah, right.” [Interruption] It is “Swainy and the boys”—yes, there were going to be more people than just Paul Swain involved. Like the Tui advertisement, I said: “Yeah, right—sensible.” John Tamihere told the business community that the Labour members would not let the left take over their caucus, and that they would fix this legislation up. I asked people whether they really believed that, and the answer was: “Absolutely. These guys are committed. They will not have the lunatic fringe running the place any more.” The Prime Minister has taken Margaret Wilson out of the play because the business community is so discontent.

John Key: She’s a liability.

Hon MAURICE WILLIAMSON: Yes. The Labour members said the legislation would be fixed, but what do we see? We will see exactly the same sort of legislation sitting on the statute book, with one bite out of an elephant that is the difference. I do not know how that is supposed to fix the situation. How could it have been mucked up so badly in the first place? The Minister will not tell us that. How does this bill fix it? It does not. Why is the Minister not leaving businesses to negotiate it themselves?

PETER BROWN (Deputy Leader—NZ First): This debate is quite interesting. When this bill was referred back to the House, New Zealand First started by wanting to support it. It wanted to correct the anomalies. It wanted to tidy up the Holidays Act. I want to make New Zealand First’s position clear on that Act. We support low-paid people getting time and a half when they work on a public holiday. We are strong on that. We also support Matt Robson’s bill, proposing to give 4 weeks’ holiday to low-paid people, being amalgamated into this bill. We thought those were moves in the right direction. So we supported the first bill, but we got it wrong.

We got it far more wrong than we ever envisaged at the time. This bill was the opportunity to correct the anomalies. New Zealand First approached it with that in mind. We wanted to correct the anomalies, but we have failed to do that. The bill corrects some of them. It corrects the non-payment of time and a half when a person volunteers to work on a public holiday but for some reason he or she does not and is then no longer entitled to get time and a half. That was a good move. It also corrects the anomaly of the blank-cheque approach to sick leave. Now the employee will have to see a doctor if the employer is worried or wants proof. That was a move in the right direction, although we would like to see it a little tighter.

But Wayne Mapp’s amendment, which addressed the problem of relevant daily pay, was ignored. My understanding was, and I am sure it is shared by my New Zealand First colleagues, that United Future members were concerned about the problems of relevant daily pay. Here was the chance to address it all, and they said: “No, we abstain.”, and they said that this is taking a bite out of an elephant. All that United Future is doing is licking the elephant’s rump. It does not even have a mouthful of flesh—

John Key: That’s not a good mental picture.

PETER BROWN: It summarises its view. United Future also ignored my proposed amendment, which would have addressed the problem of salary earners getting time and a half when they work on a public holiday. Earlier we heard John Key talk about Theresa Gattung, who, under this bill, could work on a public holiday and get time and a half for the time worked.

John Key: And a day in lieu.

PETER BROWN: And a day in lieu—and she gets only $2.8 million a year!

John Key: She gets 15 grand for working on a public holiday, and a day in lieu.

PETER BROWN: I do not know how she will cope. It will be a struggle. Clearly, United Future has taken that on board and is saying to Theresa Gattung: “We’re not sure that you’re getting enough, so here’s a bit more just in case.” This is pitiful.

United Future has let the side down today. It did not have a representative sitting on the select committee. It did not show any interest in coming along to the committee and, as far as I am aware, it did not even ask for a copy of the submissions. Yet it comes here today and supports a bill that it knows in its heart of hearts addresses only one small part of the problem.

Paul Adams: One bite.

PETER BROWN: No, it is not just one bite. It is a long way from that. One cannot even see the teeth marks. That is how small a bite it is. Here was the opportunity to tidy up the whole thing once and for all. If United Future had said: “Let’s get together and tidy this up, and then we will support the bill.”, New Zealand First would have supported the bill. Today I have listened to United Future’s contributions, small as they may be, and they have persuaded me that this is too far wrong to give it any support to at all.

I am disappointed with the Government members. Apart from the Minister, nobody from the Government side has taken a call, at all—not one single call. The chairman is rushing this through, and the Government members have not taken one call. Poor old United Future is waving the flag for the Government, and, when a crucial point is reached, it abstains.

John Key: Are there any other parties in this Chamber that abstain?

PETER BROWN: I cannot readily think of one.

HEATHER ROY (ACT): I do have to worry about the naming of this bill. Part 2 deals with the sick leave provisions. Half of the bill is about sickies. This bill, rather than being called the Holidays Amendment Bill, could be called the “Sick Leave Bill”, because it seems clear to me that this Government considers sick leave and holidays to be exactly the same thing. Therefore, the “Sick Leave Bill” may well be a more appropriate title.

I want to spend a short amount of time speaking about the effects this bill will have on the health sector. I would like to have spoken about sickness and injury in the Part 2 debate, but I will address it briefly now. In the 2003-04 financial year, district health boards had four public holidays under the new Holidays Act that they were not funded for under the Budget at the start of the year. At the end of the year they were still not funded for them. District health boards are big employers. In small towns, and particularly in the provinces—the Timarus, the Invercargills, and the New Plymouths—the district health boards are the biggest employers in town. As a result of having the Holidays Act imposed on them, they have had significant increases in their costs, with absolutely no recognition of this from the Government.

One might say that the district health boards are, in fact, the Government and that along the line they will probably get some more money. I do not think they will, certainly not for the 2003-04 year, and in the 2004-05 year, which we are already well into, that seems to be in question, as well. Let us cast our minds further afield to the private hospitals. I am not talking about the surgical hospitals, like Southern Cross hospitals, although, obviously, they are also affected; I am referring to the aged-care hospitals, the private rest homes and the private aged-care hospitals. They have absolutely no power over reimbursements of costs for these holidays. They are dependent on the district health boards for receiving their funding. Their funding used to come directly from the Ministry of Health but has been devolved now to the district health boards. So these private hospitals—the rest homes and the aged-care hospitals—and the district health boards suddenly find themselves between a rock and a hard place, because they do not have adequate funding to pay the increased costs that the Holidays Act has imposed on them. They really have no redress, at all.

I have visited several of them recently. I spend a lot of my time going around the country visiting both the district health board hospitals and some of the private hospitals, and I have found that this is one of their major concerns. Their biggest concern is the lack of funding they are getting, and the impact that the Holidays Act has had on them. They know where to go. They have talked to both Minister Dyson and Minister King about this. They get words saying that things will be addressed, that they are looking at the problem, but they get absolutely no redress for the 2003-04 year when this Act was imposed on them.

I think that the Government is telling the health sector, the district health boards, the private hospitals, the employers of this country, the hospitality sector, other sectors that are involved, and the people on this side of the Chamber that we should be grateful that the Government has looked at this. It has amended the Holidays Act with Part 1 and has addressed some of the sickness problems that have arisen—things they were told at the select committee would happen the moment this legislation was put in place, and they did.

We are supposed to stand here and be grateful for this amendment bill—this misnamed amendment bill. I ask the Minister exactly what we are supposed to be grateful for. Why does the Minister not stand, take a call, and tell members why we are supposed to be grateful that he is addressing these things? This amendment bill goes absolutely nowhere towards addressing the problems that have been imposed upon the employers of this country, including those that the Government pays: the district health boards, the teachers, and whoever else. We are all supposed to stand here and be grateful for this legislation. I have to say that I too am very surprised by the stand that United Future has taken on this. I stood in the Ohariu-Belmont electorate last election, and I will be standing there again.

Dr WAYNE MAPP (National—North Shore): National is fundamentally disappointed with this effort. It is very much a missed opportunity. The Government knows full well that there are numerous defects and deficiencies with the Holidays Act 2003, but it has chosen to fix up the most trivial issues within the Act. This is truly an example of “Government of trivia”. The Government says that it has five problems—three of them are really big; two of them are really small—and has chosen to fix up the small ones, knowing full well that all in the business community want the major problems fixed.

I guess the Government actually thought, because it certainly proclaimed it at the time, that business would welcome this bill with open arms, saying: “What a responsive Government. Isn’t it wonderful that the Government has appointed Mr Swain as Minister, instead of that terrible woman Margaret Wilson.” That is what they expected business people would say—

John Key: Well, they did.

Dr WAYNE MAPP: They did not say that. When business people had the opportunity to make submissions, they consistently referred to the Government’s complete and total failure to get to grips with the real problems—the three big problems, not the two trivial problems. That is why they are so disappointed with the Government, and that is why Mr Swain is such a failure as a Minister. If he goes out to the community trumpeting this kind of legislation as an example of his success, it will be an epitaph of failure. The bill was, and is, a missed opportunity.

I proposed a Supplementary Order Paper that was intended to be a compromise. I took clauses 7, 8, and 9 of the Holidays Bill of 2003, which provided the definitions of ordinary pay, and I compacted them into a single Supplementary Order Paper that gave the Government an opportunity to fix that problem, based on the bill it had introduced into Parliament just 12 months ago. What did the Government do? It just ignored it.

Even more serious, a party that proclaims itself to be a common-sense party did the craven thing. The craven thing in this House is to abstain. People vote parties into this Parliament to express a view. We either support something or we oppose something, so the public can judge us by the record. The public will judge the failure of this Government on this bill. How will it judge United Future, which simply abstained? Frankly, I think that that is a travesty and a betrayal of their electors. United Future will be judged accordingly.

I know that Mr Adams goes around the North Shore proclaiming himself to be friendly with business, and stating he understands the experience of running a small business. He talks to people up and down the North Shore, because I have seen him do it. He betrayed those people today, and it will get back to them that when United Future members had the opportunity to fix a problem, they failed. That is the sort of thing that parties are judged on.

It is with a degree of sadness that National finds itself having to vote against this bill. While the bill fixes up some things, we cannot support a bill that ignores serious and major problems. It would be fundamentally wrong to give an endorsement to a bill that is actually a failure—a failure to recognise serious problems. Every single submitter from the business sector said that the Government had failed—and it has.

LINDSAY TISCH (National—Piako): As this debate draws to a close, we find that quite—

Hon Richard Prebble: If you want a call that is no reason to close down the debate.

LINDSAY TISCH: Well, I am standing, just in case the member did not notice. This is a serious matter. I have been astounded to hear this evening that a party that is meant to stand for small business, and says that it is the party of common sense, will vote against a bill on one occasion, vote for it the next time, and on occasions decide to abstain. That is the United Future party.

Simon Power: What does the member say?

LINDSAY TISCH: He said: “Yep. That’s what has happened.” Well, I say this to the United Future party: “It is your party, Mr Adams, that could stop this nonsense here tonight.”

I want to quote what the member said on 16 December last year, in Hansard, Volume 614, at page 10742, in respect of the Holidays Bill: “If we accept that 99.9 percent is good enough, then members should consider this, which I found on my cereal packet—it always pays to read one’s cereal packet when having breakfast, because one may learn something. … I do not believe that close enough is good enough.” That is what he said.

Hon Maurice Williamson: Did he know what that meant?

LINDSAY TISCH: I do not know whether he knew what it meant, but his party voted against the legislation. What is it doing tonight? It has come round and is now saying: “Ah, there have been some minor changes, so we will sacrifice the business community.” The United Future party will sacrifice the workers who are employed in the small businesses of New Zealand—600,000 employees in 292,000 small businesses—yet it is meant to be the party that advocates and champions small business.

Let me just continue to quote, and this refers to some of the other businesses, which have been mentioned tonight, which United Future said that it supported. The member said: “I mentioned that the Government was comfortable basking in the glory of The Lord of the Rings films, but that it was not prepared to listen to the five companies involved in the films, all of which have said that the bill will make it harder to make movies in New Zealand.”

Hon Maurice Williamson: Are you from Hobbiton?

LINDSAY TISCH: I am from Hobbiton. I’m the “MP for Hobbiton”. The member continued: “I touched on Federated Farmers’ warning about increases in costs. I touched on the Hospitality Association’s calculation that the bill will add $63 million to the operating costs within its industry. Does this Government care about the work-life balance of wage-workers only, and not bosses? How many here stand up for what I believe is one of the most neglected sectors of our nation—small-business owners, the small-business men who work long and hard and have families to support? … This legislation is not a good Christmas present for those small employers.”

That is what United Future members said, so how can they come round now and say that they are going to vote for it and for those changes? In Part 1 the member stood up and said he was voting for Dr Wayne Mapp’s amendments, but then he had to stand up and seek leave from the Committee because he had got it wrong and wanted to abstain. If one does not believe in something, one votes against it; if one believes in it, one votes for it. But what has United Future done? It has sat on the corner and wants a piece of each pie. At the election, on the hustings next year, I will be saying, as my colleagues will be saying, that United Future is the party that sold out the business sector.

PAUL ADAMS (United Future): What an interesting speech that was, from Lindsay Tisch. He obviously has trouble understanding the intelligence that comes from United Future, because we clearly recognise that this legislation, originally, was flawed. But let it be understood that United Future is a party that has unashamedly set its stance in a centralist position. Therefore, that is exactly what we are doing. When we saw what was obviously bad legislation, which was the original holidays legislation, we voted against it. But then we see that there is room for improvement, and some clauses come along. Yes, I agree; we would have liked to see far more amendments in this bill.

But let us be blatantly honest here, and pick up on what Peter Brown said—[Interruption] Yes, that is us; we are the honest party, too. He said that he could speak to United Future, and its members could stand against the Government and get these amendments defeated. Who really thinks that with all the amendments we want, we would even be dealing with this legislation tonight? Well, we would not be, and this legislation would not exist, were it not for these clauses that improve things. There is not one member from the Opposition who has not stated tonight that this bill improves the original bill. But they have stated that they will not support it because we do not have enough improvement. The fact is that they are greedy, but United Future is not. It will take it a little bit at a time.

This bill we are dealing with tonight makes it better for the business community. I notice that Maurice Williamson asked which businesses support it. All the ones that I heard going through the select committee process were from big business. I want to tell Wayne Mapp that on the North Shore there are hundreds of small-business people who are appreciative of this legislation that is going through. It will improve the Holidays Act, and I have not heard one member from the Opposition not agreeing that this bill is an improvement.

United Future members, sitting in our centralist position, say that if we can take some legislation and improve it, we are big enough and have enough backbone in us to do that—to make it better. That is exactly what United Future is like. If we are dealing with just the bill we are dealing with tonight, we see that there are far more positives in it for business than there are negatives. I am not talking about the amendments that Opposition members have tried to have put in the bill, because that is not the bill. What we have to deal with tonight is the legislation that is before us, and anybody who has half an interest in business would see that the legislation before us is making an improvement. As I have said, we will be able to improve it only one step at a time. I commend Maurice Williamson, who has obviously had his eyes opened tonight. When he first came into the debate, he thought the legislation was a rat. But now he has promoted it in his own mind, and now recognises that it is the elephant after all. It is not a rat; it is an elephant, and we are taking another bite out of it tonight. So United Future proudly supports this legislation.

SIMON POWER (National—Rangitikei): I raise a point of order, Mr Chairperson. That was just remarkable!

The CHAIRPERSON (H V Ross Robertson): No, that is not a point of order.

SIMON POWER: I am about to seek leave. I seek leave that the member be given an extension—

The CHAIRPERSON (H V Ross Robertson): No. The member, seeing that he is now a whip, might like to look at Speakers’ rulings 1/5 and 1/6. He cannot seek leave for someone else.

Hon RICHARD PREBBLE (ACT): Listening to United Future members reminds me of that old nursery rhyme, which members know, about the grand old Duke of York, who marched his men up the hill and then marched them down again. When they were up, they were up, and when they were down they were down, and when they were only halfway up, they were neither up nor down. That is United Future! Its members are either for the bill or against the bill, and when they are in the middle they are neither for nor against. And that member calls that being the centre party, because he can go to the people of New Zealand, look them straight in the eye, and say that he supported their position on this bill. It does not matter who it is. He can look the trade unions in the eye and say: “We were right with you, brothers!”. He can go to the boardrooms of New Zealand and say that United Future was there, saying that it was useless legislation, and he can go to the media and say: “Like you, we didn’t understand what we were doing, so we did nothing.”

Well, of course, what we are doing in fact is huge damage. I thought my colleague Heather Roy made a very good point, and I would like to hear from the Minister. When he was considering the unintended consequences, I ask whether it was an unintended consequence that every health board in New Zealand was not funded for the Holidays Act. How many operations does that equal? How much longer are waiting lists as a result of that underfunding, and is it the same with the education sector? Is it the same in social welfare? Heather Roy tells me that she has actually put in a written question to every Minister, asking what the impact is, just on the Government. Not one of them has been able to reply.

I would like to know from the Minister whether that was an intended consequence. He said that the Government was only fixing up the unintended consequences, so it must have intended to cut health funding by this bill. Perhaps that is what it should be called. I ask United Future, as that party is supporting it, whether its members think that cutting the health vote by 4 days is intended. I remind the Committee that that is very, very significant. If we look at the latest Department of Labour statistic, we see that it shows that wages in the last quarter have gone up 1.8 percent, but actual wage costs have gone down—the reason being that Anzac Day fell on a Sunday. That just shows what 1 day does to the whole economy. But there are 4 days as a result of this bill, which means extra costs that are not funded.

I also have to ask United Future members, who are greatly interested in this bill, why they did not put a representative on the committee. Then they would have known that the Government refused to hear from small business—the Government that the previous speaker is now supporting. It is United Future’s view that it is all things to all people, but I say to that party that I thought it portrayed itself as being a party of principle. If United Future is a party of principle, then it follows that that party cannot be all things to all people. I believe that a myth the Government has is that by passing laws, somehow it can create extra money. There is not another dollar for the health vote. This legislation did not suddenly create 4 more free days. No, they still had to be paid for. Just as we can see that that has a huge impact on the health industry, we also see that it has exactly the same effect on every single business in New Zealand. It has also made a whole lot of unallocated costs.

I say to the House that I think, again, that those in the bureaucracy who normally serve us well, on this bill serve us very badly. I thought that the papers we got from the Department of Labour were shockers. But that department, as the most politicised department in the whole civil service, is prepared to support the Labour Party, because under the National Party when we did not have any strikes or industrial relations, who needed a Department of Labour?

Hon Bill English: It had nothing to do!

Hon RICHARD PREBBLE: It had nothing to do, and it was a department that fell in size and influence. Of course, under a Labour Government, those bureaucrats have gained enormously. They have had increases in salaries and in the size of their department, and they are quite willing to support the Government on this type of bill.

MARTIN GALLAGHER (Labour—Hamilton West): I move, That the question be now put.

JOHN KEY (National—Helensville): Now I know why the party of those members is called United Future. If some members are for something and some members are against something—and some of those members are neither for nor against something—then they have to be united, because there is nobody else to disagree with them. That is why it is the United Future party!

Here is a little tip for United Future members: they will know they are in trouble if they are in there supporting the Government on industrial relations policy when not even the Greens are voting with the Government. They know they are in trouble now, because this is very sloppy legislation.

That is why we are here. We are here because despite the fact that it took about a dozen years to have the Holidays Act rewritten, the Government has made a complete botch-up of it. Those members made a botch-up, because they would not listen to the people who came to the Transport and Industrial Relations Committee. They would not listen to the employers who came, and they would not even listen to some of the employees who made valid submissions, so they made a botch-up of it.

When the winter of discontent came around, when Labour focus groups went out there and pulled out a picture of Margaret Wilson, and when the worm went into free fall—it thought it was on a bungy-jump, but with no bungy attached—Labour members said: “We have to find somebody else.”, and they rolled out the friendly face of Paul Swain. United Future said it was neither for him nor against him—it was sort of for and against him—but it would vote with the Government.

And lo and behold, here we are tonight, ramming through something that is, frankly, a disgrace. It is legislation that is absolutely shoddy and that nobody believes in. About the best United Future can tell members is that it is botched-up legislation, but somehow that makes it slightly less bad than absolutely terrible—and that is a reason to vote for something.

We in the National Party did not come into this House to pass legislation for employers and employees of New Zealand that is, frankly, a botch-up. That is not the future for New Zealand, and if the future for United Future is to be holding up legislation that is simply bad for business in New Zealand, then I think that its members have to go back to fundamentals and ask themselves why they are here—or maybe that is the issue. They should not be voting for this legislation; they should be making the Government go back and listen to the select committee and to those employers who came here and said that it would be bad news.

I want to focus on one important element of Part 2 in this speech, and to make a few comments about the issue relating to the need to get a medical certificate and the question of who should pay for that medical certificate. This botched-up legislation says that an employer has to pay for it. That is the way Paul Swain sold it to the other 47 members of his left-leaning Government. He said: “This is the way we can do it: we’ll get the employers to pay for it.” Can some member tell me why the burden of proof has to fall on the employer? It is not the employer who is asking for the day off, or claiming that he or she is sick. Why does the burden of proof—that proof the employee is unwell—have to fall on the employer? If United Future members can answer that, then maybe they can say why they are either voting for or against, or abstaining on, this bill—I am not quite sure what position they currently have. It is probably moving around the stratosphere as we speak.

Simon Power: Give it another 5 minutes.

JOHN KEY: Give it another 5 minutes. This is not good legislation. This is legislation that was welcomed when the review was to take place—welcomed because it was an opportunity to fix up what had been quite a troublesome area for the people of New Zealand. What did the Government actually do? Its members passed a nebulous term called, I think, relevant daily pay, which even they could not understand. Even they could not work out what that meant. All they knew was that there had been years of negotiations, when employees had finally come to agreement with employers—in harmony, working together—on what ordinary pay meant, and when a decent day was a day off. Now all those negotiations have to be ripped up.

I also make the point that employers who do not pay their salaried staff time and a half or give them a day in lieu when they come into work on a public holiday, are breaking the law. If a small employer does that, and an employee leaves his or her employment and goes and makes that point to somebody else, someone will come after them. So I just want to know whether that is what is happening to Telecom, and whether Theresa Gattung will be paid $15,000.

Hon MARIAN HOBBS (Minister for the Environment): I move, That the question be now put.

Hon ROGER SOWRY (National): I want to talk about one issue that has not been touched on yet, and I want to indulge the Minister, if I may, on an issue about the commencement of the bill. When the Minister announced the working party that was looking at this bill, made up of the New Zealand Council of Trade Unions and the business sector, he said that the bill would be fixed before Labour weekend—hence the rushed timetable; hence the inability to hear people who wanted to be heard on the bill; hence the Government ignoring the overwhelming majority of submissions from anyone in the business sector who said the bill simply would not work; and hence the Government stitching up the deal with United Future, whose members are saying that they do not think it will work but, as Peter Brown has phrased it, it is the sort of lick—

John Key: The slurp.

Hon ROGER SOWRY:—the slurp of the elephant to see if that will fix it. However, the one thing businesses said was that even if the Government passes this bill before Labour weekend, they cannot adjust their payroll systems to cope with it for Labour weekend. So the bill will not make one jot of difference. I ask the Minister whether he is aware of that. I think he is. So given that the bill will not make any difference to Heinz-Wattie, whose officials no doubt told him that; given that the manufacturing sector appeared before the committee—companies like Heinz-Wattie and Carter Holt Harvey—and given that Air New Zealand is before the court this week in respect of the Holidays Act, I ask the Minister why he does not say: “I am sorry, businesses, but you will have to suffer paying the extra amount for Labour Day on the Monday”, because everyone will have to as they cannot change their systems. I ask him why he does not get it right.

I guess my appeal to United Future is: have its members thought of that? My appeal is for them to pray on it, think about it, see whether it will work, and see whether they can say that they will get it right for Christmas—not for Labour Day, but for Christmas—because this bill does not get it right for Christmas. The costs for Christmas and New Year are huge.

I tell the Minister I understand that even the union movement has said that this bill does not fix all the issues, and that there are still some problems. Late in the day after the select committee process, Ross Wilson came to the Minister and told him: “No, it’s still not right.” But the Minister said to him: “No, no. I’ve promised a Labour Day fix, and fix it we will, even if it’s wrong.”

I know that members may have a wide-ranging debate on these clauses of the bill, but I ask when the clause that deals with the bill’s commencement will be signed—on Friday? The Minister nods. It will be signed on Friday by the Governor-General. It will come into force on Friday with businesses, according to the law, having to pay new rates just 9 days later on Labour Day Monday—and they cannot do it. They physically cannot do it.

That is the sort of botch-up we have had from the Minister’s own colleague around the STV thing when the votes could not be counted. At the end of the day, there has to be less spin and more substance, and there has to be a Minister who is prepared to listen. When he is not listening, someone in Parliament needs to be the conscience. Some party that has some influence needs to say: “Yes, we will stand for what is right, not for what is convenient.” I wonder if there is a party whose conscience would lead it down that road.

Lindsay Tisch: It’s a big ask.

Hon ROGER SOWRY: It is a big ask. It requires putting a stake in the ground, and for a party that should support stakes, I think that that is a position it could take.

I am worried that the Minister has ignored business. People who work on Labour weekend will, of course, be paid under the old law. Businesses will shut. This bill will solve nothing.

DARREN HUGHES (Junior Whip—Labour): I move, That the question be now put.

hat the question be now put.

A party vote was called for on the question, That the question be now put.

Ayes 70

New Zealand Labour 51; Green Party 9; United Future 8; Progressive 2.

Noes 49

New Zealand National 27; New Zealand First 13; ACT New Zealand 8; Independent: Awatere Huata.

Motion agreed to.

A party vote was called for on the question, T

Hon ROGER SOWRY (National): I raise a point of order, Mr Chairperson. I think it is appropriate to do this while voting is taking place. I have not before seen a party take instructions from another party during a vote. I have heard Speakers rule in the past that members approaching people in a threatening way and telling them how to vote is out of order. I wonder whether it is any different when a member does that in a jovial way. At the end of the day, voting is something that is quite responsible. For a member of a party—even a party as tiny and insignificant as the Progressives—to wander into the Chamber as the Progressive member did, to say: “Just a minute, before I vote I have to find out what I am meant to do.”, and to take that instruction from another party, I think is probably a breach of the Standing Orders.

The CHAIRPERSON (H V Ross Robertson): I thank the member for drawing that to my attention. I did not see that the member was being intimidated in any way. If he wishes to discuss the matter with someone else, I think that is entirely up to the member and the party he represents. Members might like to look at Speaker’s ruling 61/2.

A party vote was called for on the question, That clause 1 be agreed to.

Ayes 61

New Zealand Labour 51; United Future 8; Progressive 2.

Noes 59

New Zealand National 27; New Zealand First 13; Green Party 9; ACT New Zealand 8; Māori Party 1; Independent: Awatere Huata.

Clause 1 agreed to.

A party vote was called for on the question, That clause 2 be agreed to.

Ayes 61

New Zealand Labour 51; United Future 8; Progressive 2.

Noes 59

New Zealand National 27; New Zealand First 13; Green Party 9; ACT New Zealand 8; Māori Party 1; Independent: Awatere Huata.

Clause 2 agreed to.

Bill reported with amendment.

Bills

Employment Relations Law Reform Bill

In Committee

Part 1 Employment Relations Act 2000

Dr WAYNE MAPP (National—North Shore): I raise a point of order, Mr Chairperson. I wish to draw your attention and members’ attention to the structure of this bill and compare it to the last bill. In the last Committee stage debate we spent 4¼ hours debating the Holidays Amendment Bill, which has a total of 13 clauses. If we think of the ratio of time per clause, we note that it is nearly a quarter of an hour per clause.

The CHAIRPERSON (H V Ross Robertson): So what is the point of order?

Dr WAYNE MAPP: In this bill, the current bill, there are 117 clauses in Part 1. One reason why there are 117 clauses is that some of the clauses adopt up to 10 or more provisions. They cover a huge range of issues. On top of that, there are three Supplementary Order Papers from the Minister, plus numerous other Supplementary Order Papers and amendments. My point, Mr Chairperson, is that we in Opposition expect yourself and subsequent Chairpersons to provide a fair and reasonable opportunity to discuss the range and breadth of issues contained in this important legislation. The Government referred to the previous legislation as unintended consequences. In contrast, this is a major piece legislation, and we expect a full hearing on it.

The CHAIRPERSON (H V Ross Robertson): Yes, the member has made his point. I inform the member that Chairpersons take into account a number of issues when considering debate. In fact, we are guided by Standing Order 102. I take on board what the member has said, and every consideration will be given. I now seek the call.

Dr WAYNE MAPP (National—North Shore): My first contribution on Part 1—

Simon Power: Out of four.

Dr WAYNE MAPP:—out of four—will cover the broad range of issues essentially by reference, because I expect to develop many of the issues in detail. National has characterised this bill as being a compulsory unionism bill. Members should look at the Minister in the chair, Paul Swain. That Minister proclaims himself and allows himself to be proclaimed as friendly to business. In fact, he is presiding over legislation that will dramatically reduce choice in the workplace. It will dramatically reduce the freedom of New Zealand businesses and workers. This bill cannot possibly be construed as even remotely—

Hon Richard Prebble: I raise a point of order, Mr Chairperson. I apologise for interrupting the honourable member. I was going to wait until the end of the speech, but I see that you are about to vacate the Chair. I listened to you very carefully, and I thought you said you would decide on how long the calls would be under Standing Order 102. I looked up Standing Order 102 to see what it states, and it relates to factors to be taken into account when calling members. It has nothing to do with the length of the debate. So I sincerely hope that you will not determine the length of the debate by whom you call, and I hope the points that have been made by Dr Mapp are taken into account. We are seeing a very disturbing trend, and we are relying on the Chair to uphold the rights of this Chamber and of backbenchers. What we are seeing is the Government putting legislation into larger and larger parts, thereby cutting down the rights of this House. You will be aware—it was certainly the case when I first came to this House—that at one time we would have debated such legislation clause by clause. This is a bill that the Committee would easily have spent a week on. I have a horrible feeling that this part will probably be all over by about 10 o’clock.

The CHAIRPERSON (H V Ross Robertson): The member makes a very good point, and as the Chair I have taken on board what he said. I know that the Chairperson who will follow me has also taken it on board. Perhaps the member might also like to look at Speaker’s ruling 70/1—it should have been read in conjunction with the Standing Order—which concerns the Committee of the whole House.

Dr WAYNE MAPP (National—North Shore): I am appreciative of the fact that the Chairman has acknowledged the importance of the points of order made by both myself and the Hon Richard Prebble. This is a very, very large part. I will not be able to canvass in the space of 5 minutes the full range of issues.

The very first pernicious feature of this bill is that it dramatically expands the scope of good faith. Bargaining is a robust process. People put up maximum positions in the process of bargaining, and expect a robust bargaining process. This bill makes any breach of good faith potentially subject to a penal sanction. It will not be just an issue that might be called before the Employment Relations Authority. It will be subject to a penal sanction and a fine. That will have a chilling effect on the way both businesses and employees will be able to conduct their negotiations. It is an intrusive and heavy-handed approach of the State in what is essentially a private contractual arrangement.

Secondly, the Government has said that whenever an employer offers terms and conditions of a collective contract to a person on an individual contract, which has the intention and effect of undermining that collective, that will be a breach of good faith and will lead to a fine. What is more, the Minister in his second reading speech boasted of the fact that if, in the process of negotiation, there was simply the effect of undermining the collective contract, that also would be a breach of good faith, which would again lead to the punitive penal sanction of a $10,000 fine.

Thirdly, breaches of good faith not only attract a penal sanction, but they allow the Employment Relations Authority to determine the terms of a contract. Freedom of agreement between an employer and an employee is lost because we once again have judges, or authority members, deciding employment contracts. How on earth can people negotiate fairly and reasonably in such a climate when the legislation is intended to have the chilling effect of destroying the ability of people to reach agreements?

My fourth point is that the Government, via a Supplementary Order Paper, will introduce a bargaining fee. That is tantamount to compulsory unionism. The reason is that every union in its collective contract will demand that the collective contract includes the ability for a bargaining fee. Employers will have no real choice. They will agree to that. If there is a ballot of the workers and the majority say yes, it means that every single person in the workplace pays a union fee. That is compulsory unionism. That is wrong.

Hon RICHARD PREBBLE (ACT): I will take up that last point first. This is worse than compulsory unionism. Under compulsory unionism, at least everybody who was in the union was represented. This is the sort of trade union paradise in which the trade unions get paid by everyone but do not have to represent them. Under this bill there can be 100 workers, and only 10 belong to the union. That is quite a good analogy to make because only 10 percent of all workers belong to the union. The union comes along and says that it will negotiate on behalf of the 10 people and therefore the other 90 ought to pay. That is what the Government is proposing. It is called a bargaining fee.

Lianne Dalziel: What percentage has to agree?

Hon RICHARD PREBBLE: What percentage? Does the member think that having a ballot makes it right? I would ask that member where the provisions are to ensure that the bargaining fee bears any relationship to the work that the union does Where is the provision to ensure that none of the bargaining fee is used to finance that member’s election expenses?

Dr Wayne Mapp: No provisions at all!

Hon RICHARD PREBBLE: There are no provisions at all. This is an American proposal. It exists in America. [Interruption] The member from the Green Party, I know, hates America and therefore probably does not even know that this happens. But yes, it does. That is where the Government got it from. In the United States the union movement not only claims to have bargained for people who did not ask it to bargain, but then spends the money supporting various causes. That is an outrage.

Another outrage in the bill is that the concept of good faith has been extended beyond its common law meaning, which is mutual trust and confidence. The new meanings are so confusing that they will actually be whatever the Employment Court says they will be. Does that matter? Yes, it does. Because if someone is found to be in breach of good faith, then the Employment Court—that is, the State—can then start to fix the terms of employment. So a small business will think that it is employing people with agreements that were made between employer and employees but is then told that it has not met the good-faith test. That could be just because an employer has said no to an unreasonable demand. Then the State will decide how much and on what terms the business is employing people. There is a word for that and it is communism.

We have another concept in the bill, of “vulnerable” employees. No one has come along to explain what this concept means or whether it is needed. It is another huge extension of State power. I warn the Parliament that these are the provisions that the Government tried to introduce when it first introduced the Employment Relations Bill. Thanks to the efforts of my party, the National Party, and employers up and down the country we managed to have those clauses taken out. Then the Government said what a great bill the Employment Relations Act is when it is only as a result of the amendments made. Here we have the Government taking a huge step backwards towards compulsory trade unionism. I think it is worse than compulsory trade unionism. Trade unionists will get paid for doing nothing. That is an outrage. It will not help prosperity. It will not help employees in New Zealand. It will certainly not help employers and it will not help to improve industrial relations. This is a bad bill and it goes in the opposite direction to that which the Government was boasting about.

Today I heard the Government boasting that New Zealand was a good place to start a business. This bill goes in the opposite direction, and the Government cannot have it both ways. The consequences of this bill will not mean a collapse of the economy tomorrow but will mean that it will be harder for one New Zealander to offer a job to another. It will mean that people will have to pay money to a trade union that they did not join, that they did not ask to bargain for them, and that they did not ask to provide services. They do so because the Labour Party is abusing the power of the State to take that money from workers. This is a bad bill. It is some of the worst legislation that I have seen in this Chamber and I have been here for 27 years. This is very bad legislation and we ought to vote it down.

Hon PAUL SWAIN (Minister of Labour): I want to make a couple of comments in response to the member, but I personally want to congratulate the Commerce Committee because I think it did a good job on making a number of improvements and clarifications to the bill as it went before the select committee. I was highly disappointed with that member’s speech. Often he makes reasonably incisive speeches, and on the odd occasions Ministers get to change bits of legislation on the basis of them. But I listened to that speech. It was the same old tired rhetoric that was given in the year 2000. What did he, and people like him, say in the year 2000? That the Employment Relations Bill was going to lead to a slacking off of growth! It was going to lead to rising unemployment, and strikes were going to skyrocket. I remember that. It was doom and gloom in the National Party and the ACT party, backed up by a number of people commentating in the private sector. What have we found? Let us just look at the reality. Growth, on average now, is about 3.5 percent. That is not bad, actually, relative to the OECD. Unemployment is now 4 percent, and we know, relative to the OECD, that that is amongst the top performers of the OECD and, of course, strikes are virtually non-existent, and certainly down, even from the days of the Employment Contracts Act.

So what we have heard from that member are all the crocodile tears that were shed at the time the Employments Relations Bill went through. But I do want to take up the point about bargaining fees, because this is really the substance of one of the Supplementary Order Papers that have been introduced, at the invitation, I should say, of the select committee.

Dr Wayne Mapp: No, the majority.

Hon PAUL SWAIN: At the invitation of the select committee.

Dr Wayne Mapp: The majority.

Hon PAUL SWAIN: It was at the invitation of the select committee that I introduced this Supplementary Order Paper. The committee invited me to, and I did. So the bargaining fee arrangements are quite clear if one reads the bill. It says that a bargaining fee arrangement can be entered into with three conditions attached. Firstly, the employer and the union have to agree that such an arrangement should occur. Secondly, there has to be a ballot of all the people likely to be covered. Thirdly, any member—any worker—who does not like the idea simply opts out. Now to hear the outrage about that from that member, and the National Party, that this somehow is a return to compulsory unionism is just plain garbage—absolute garbage. They have tried to run the line. It has got absolutely no traction, because anybody with a cursory understanding of what the bill says will know that that, in fact, is simply not the case.

There has been some discussion, because I have read this in a couple of places in the media, and I have had a discussion with Peter Brown of New Zealand First, asking whether the employer has to agree—there is possibly some confusion around this. I have gone back, had a look, and said that it is reasonably clear to me. But for the avoidance of doubt I have introduced another clarifying Supplementary Order Paper to say that the employer and the union have to agree as part of a collective agreement. I cannot make it, I think, any more clear than that. The Supplementary Order Paper also states, as I say, that there has to be a ballot; and finally any employee who wants to opt out, can—there need be no reasons, he or she can just opt out. Therefore, somehow, this being seen as the big outrage in returning to compulsory unionism is just absolute nonsense, as has been pointed out by a number of people leading up to that proposition being put forward.

So this is actually quite sensible, reasonable legislation that has been reported back. It addresses a matter that employees and unions were saying was a problem, which is basically what is called freeloading; that is, people not paying their taxes, and wanting free health-care. The unions and a lot of the delegates have said that what happens is that they pay their fees, they negotiate, they bargain, and automatically the things get passed on as of right. They were outraged at that and they had a fair point, to be frank. Freeloading is not acceptable.

Hon Richard Prebble: Oh rubbish!

Hon PAUL SWAIN: It is not acceptable. On the other hand, the employers were saying that they wanted to make sure, actually, that they could pay employees in the work-site, whether they were unionised or not, the same. So we have gone out of our way to spell that out as clearly as we can. Employers can pay, whether people are on a collective or an individual contract, the same or similar. We cannot be any plainer than that.

So I return to where I started. We heard the crocodile tears in 2000. This was going to be the death knell of capitalism. I remember people making speeches such as that. This was going to be the end of New Zealand. “No one would employ one more person.”, I heard someone say; the same kind of thing that Richard Prebble just said before. Unemployment is now 4 percent. We have not been in that situation for nearly three decades. I think the facts have spoken for themselves. This is an entirely reasonable bill. The reality is that 80 percent of the workforce in New Zealand is not covered by collectives—they are not unionised. In fact, this particular piece of legislation will have very little impact on them, as it had very little impact on those who were not involved in collectives anyway. So I think that it is important to note that the select committee has done good work on this. It has put work into it and has come back with some sensible recommendations, and I recommend it to the Committee.

Hon ROGER SOWRY (National): I rise to back the National Party’s total opposition to this legislation. The Minister paints it using rose-tinted glasses, and he knows it.

Hon Member: Gilded the lily!

Hon ROGER SOWRY: Well, he has more than gilded the lily. I want to take up a couple of points. The Minister started off, with great virtue, saying that a bargaining fee has to be agreed to, only at the invitation of the select committee—that why he said, first of all, that he brought the Supplementary Order Paper to the Table. Actually, I did not invite the Minister to do that. No one from National did. No one from ACT did. Actually, I say to the Minister, his own members did. The Labour Party did. So why is the Minister so terrified to stand up and say: “Labour decided to do this.”? Why does he not say that in the Committee? Why does he try to hide behind the select committee?

The next thing the Minister said was that no one should be scared of the bargaining fee, because of the rules—both sides have to agree with it. Anyone who does not want to pay the bargaining fee does not have to. I ask the Minister whether that is right. Are those good rules?

Hon Paul Swain: They’re sensible rules.

Hon ROGER SOWRY: The Minister says they are sensible rules. Why do we not have the same rules for multi-employment collective agreements? Why do we not say that if people do not agree to enter into a multi-employment collective agreement, they do not have to? Why do we say that it is all right for bargaining fees—we have to agree they are good, sensible rules—but for a multi-employment collective agreement we will compel people? Why do we do that? Why do we not have the same rules for bargaining?

It is no good the Minister standing up here in the Chamber and saying: “It’s terrible to have freeloading.” I say to the Minster that workers would not have to freeload if they were allowed to negotiate collectives outside of the union. Why do we not allow that? Why do we have a bill that the Minister has passed that forces, as my colleague Bill English said, members to freeload and then have the Minister get up and say: “It is outrageous that they are freeloading. We’re going to force them to pay a union fee. But it is not compulsory unionism.” Oh, no, that is not compulsory unionism! Of course it is. Everybody knows it. The trade unions know it, which is why they are here tonight, shepherding the bill through from the gallery. They know what is going on, and they are here to make sure that the Minister delivers, because this bill is all about the Minister getting through legislation that will compel people into unions. The union will click the ticket, and the Minister will pick up the small change for the Labour Party’s re-election fund.

That is what this is all about. This is not about productivity increases. This is not about growing the economy. This is not about becoming more competitive, and this is not about the Minister trying to paint himself as business friendly. The Minister has long ago given up on that. The Minister, “Swainy and the boys” got rolled, and I bet we do not see Mr Tamihere down here. I bet he is not driving at speed back here tonight to give a speech on this bill, although this is where he should be, because he is Minister for Small Business and they are all going to pay the price for this particularly shoddy legislation.

It is an indictment on this Government that not one business group supported this bill. Even the Labour Party’s friends, such as the new mayor of Auckland, were party to the submission made by Business Council for Sustainable Development, which totally opposed the bill. The Warehouse—the company the Minister usually cuddles up to in private, to be fair did not front up, like a lot of other companies, on its own. It used an umbrella group because it did not want to be seen to be criticising the Prime Minister in person. The Warehouse used the Business Council for Sustainable Development, so it could at least say to its business mates: “Well, we did oppose it.” It opposed the bill through another organisation, though.

Hon PETER DUNNE (Leader—United Future): This Employment Relations Law Reform Bill goes too far. When the Employment Relations Act was passed early in the life of this Government, many people were prepared to give it a chance. They saw that the one thing that has to be avoided, which this bill ensures will now occur—namely, industrial relations becoming a game of ping-pong that changes every time the Government changes—was something that we should put a stop to. This bill, by actually taking these measures a step further, simply places industrial relations law back on the political agenda, and that is no good for any of the businesses in New Zealand—exporters, manufacturers, and producers—because they will now live with uncertainty, knowing that the only certainty is that a future Government will change the law and set the whole spiral off, once again.

I want to speak to Supplementary Order Paper 276, which stands in my name and which inserts new clause 9A, “Issue of certificate of exemption”. The Committee will be aware that sections 23 and 24 of the principal Act deal with the issue of union access to workplace sites being denied on grounds of conscience, particularly on religious grounds, provided that certain certificates of exemption are in place. The amendment I am proposing by way of this Supplementary Order Paper clarifies that provision in respect of members of the Brethren Church in so far as their educational and business organisations are concerned. What the amendment does is to carry through a principle that has been long recognised in industrial relations law, from the time of the Labour Relations Act of the late 1980s right through the Employment Contracts Act days and through to the Employment Relations Act, regarding the right of conscientious objection. The amendment simply deals with the situation that now occurs as a result of moves by, in this case, members of the Brethren Church into the education field.

The amendment very particularly circumscribes the group to whom it applies. I want to quote from the amendment, and I will explain it a little further in a moment. The operative part of the amendment is that individuals, trustees, or directors are being exempted where an individual is a practising member, or all the trustees of the registered trust concerned are practising members, or all the directors and shareholders of a private company are practising members, of a religious society or order whose doctrines or beliefs preclude membership of any organisation or body other than the religious society or order of which the employer is a member. There is only one group in that category in New Zealand. It is a group that has long been respected in industrial relations law, and it is the Brethren Church. Its members, some of whom are here in the gallery this evening to support this amendment, have long had an assurance from successive Governments that their rights of conscientious objection, given their particular beliefs, would be respected.

The reality is that unless this amendment is passed we will be removing, in particular in respect of education but also in respect of some of the business operations the Brethren Church is involved in, a significant portion of that right of individual conscientious exemption on religious grounds. That is a backward step, and it cuts right across assurances that the Minister, the Prime Minister, and others have given from time to time that those rights will be upheld. Whatever one’s view about the particular organisation, that is not the point. The reality is that a long-held principle of industrial relations law is being tampered with and is going to be put in a position whereby those individual matters of conscience will now have to be dealt with in a different way. That will create hardship for that organisation—in particular, in respect of its educational activities. The Brethren Church is now involved in establishing schools up and down the country, where it employs teachers who meet all the standard registration procedures, and those schools meet New Zealand Qualifications Authority standards and other standards, etc. Those operations, which I understand educate around about a thousand children, will be put under some risk as a result of this bill being passed without this amendment being adopted.

So I say to the Committee and to the Minister that if this amendment fails, then what we are doing is sending a signal that the industrial relations law is being changed in a way that is not only detrimental but is also discriminatory.

PETER BROWN (Deputy Leader—NZ First): I would like to acknowledge the contribution made by the member who has just resumed his seat, and to tell him that New Zealand First will be supporting Supplementary Order Paper No 276 in his name. The Brethren Church has been in touch with us. I know that several of my colleagues have been spoken to, and when the Hon Peter Dunne sent me his amendment we received it with pleasure and are only too pleased to support it.

I am not sure whether this is the right part in which to be talking about the bargaining fee, but as everybody else has—

Hon Paul Swain: Yes, you can. It is in Part 1.

PETER BROWN: I do not think the bargaining fee is as sinister as some of my colleagues are making it out to be.

Opposition Members: It’s compulsory.

PETER BROWN: That is a joke. It is not. Let me give members a viewpoint—[Interruption] It is very difficult to do so with the rabble behind me making a lot of noise.

Dr Wayne Mapp: We will sit in front.

PETER BROWN: I like to see whom I am aiming at.

Simon Power: You’re not missing anything.

PETER BROWN: No, I am not. I want to give the Committee the benefit of my experience as an employer. The worst thing that can happen in an employment situation is to have a divided workforce. There can be disharmony in the workforce, with some people in the union wanting one thing, and non-union people wanting something else—they do not get on. I can recall, when I was the manager of a stevedoring company—this goes back some while—having watersiders come to the Port of Tauranga who had been involved in the 1951 strike, and they did not talk to each other. We had men in the same gang who would not talk to one another. That was exceedingly difficult, obviously, for the men in the gang, because half of them knew from the foreman what the employer wanted, and the other half did not, unless we went and spoke to them individually. It was a very tense situation, and it was never really overcome until people retired. I just point out that that situation should be avoided at all costs, in my view. An employer wants to have a harmonious working environment.

I think I can claim to be one of the members on the Transport and Industrial Relations Committee who wanted to have a close look at the bargaining fee arrangement. I was intrigued when a Dairy Foods worker came before the select committee and outlined his concern. He was a very moderate man, it appeared to me. I thought that what he put to the select committee was worth looking at. The Minister’s Supplementary Order Paper No 263, plus the new Supplementary Order Paper No 275 which he has come up with—since, I suggest, he listened to my contribution in the Chamber the other day—has just about got matters right. He could not have got them better than he has. The provision means that before a bargaining fee arrangement takes place the employer has to be consulted, and has to agree with it.

I tell my National Party colleagues that the employers I know are not spineless wimps. They are pretty tough cookies. They do not get pushed into a corner every day of the week by a union official who says: “This is what we want. Hands up.”, and members agree with it. That is a long way from being the situation.

Lianne Dalziel: That’s right.

PETER BROWN: The former Minister agrees with me. Our employers in this country are as tough and as fair-minded, by and large, as we could get anywhere. If a union comes along and says it wants a bargaining fee arrangement, the employer will not simply roll over and say: “Yes, sir, how much do you want to pay?”. The employers I know will not do that. They will ask what the advantages are—what it will cost their people, and what advantages there are.

Lianne Dalziel: You’re improving!

PETER BROWN: I am improving. There was a time when I would not have picked that up. Assuming the employer agrees, then the arrangement can progress. I do not know whether terribly many employers would agree to a bargaining fee arrangement if they were not happy with the fee structure. I think they would ask what it will cost the individual, first and foremost. I would be disappointed if they did not ask that.

Dr the Hon LOCKWOOD SMITH (National—Rodney): If this was not such a serious piece of legislation I could almost feel sorry for the Minister in the chair, the Hon Paul Swain, because he got the hospital pass. Helen Clark had to get rid of Margaret Wilson out of this role, because whenever she turned up the blood pressure of every managing director went up a few notches. So the Minister in the chair got the hospital pass. He does not believe in this stuff.

Dr Wayne Mapp: Yes, he does; that’s the problem.

Dr the Hon LOCKWOOD SMITH: I do not think he does for 1 minute. He does not believe in it. He and the right faction in Labour do not believe in all this junk. But he got rolled. I know he went to Cabinet to try to get some of this changed.

John Key: “Swainy and the boys”!

Dr the Hon LOCKWOOD SMITH: Yes, “Swainy and the boys”. They rolled him. As there are members of the Exclusive Brethren here in the gallery tonight, I want to make it clear that National, likewise, respects their conscientious objection to some of the provisions in this legislation and will also support the amendment to provide for that deeply held belief.

I want to focus on clause 30 in particular—the bit about the continuity of employment if an employer’s business is restructured. We have just heard the Minister in the chair say that in 2000, when the Employment Relations Bill was first in front of this Parliament, there was a hue and cry and outrage about how it was going to be the end of the world. However, he did not tell the Committee just now that one of the reasons the outrage died a little was that one of the most controversial clauses in the Employment Relations Bill—clause 66, on the transfer of employment on the restructuring of businesses, was dropped by the Government under extremely controversial circumstances. It damn near brought the Labour Government down.

I was at the select committee when that clause was abandoned. Willie Jackson had to be nobbled, and a deal was done with Sue Bradford to shut her up. We know what went on then. I can even tell the Committee what day it was: 6 July 2000. It was 4.30 in the afternoon when Willie Jackson was nobbled, when a deal had to be done with Sue Bradford, and when the Government backed down on the continuity of employment issue. Now the Government’s union mates have come back, and said: “Hang on, this isn’t good enough. We want our pound of flesh on this issue.” Labour has rolled over and kowtowed to the union movement, and now clause 30 of this bill is inserting new part 6A into the Employment Relations Act.

I ask the Minister this: how many employers who are not huge employers have full-time legal experts to handle their employment relations? How many employers will be able to conduct their businesses without specialist advice on this law? I do not believe that modest employers in New Zealand will be able to sort out the detail of this bill on their own. There is no way that they can, and they will have to seek specialist advice so often. That will add compliance costs to the running of businesses—big-time compliance costs. I know from employers in my electorate that at the moment they struggle to comply with the Employment Relations Act. Most do not comply with it. This legislation adds huge complexity to it. I would like the Minister to say whether he seriously believes that small to medium sized employers will be able to conduct their businesses without specialist advice and without having to pay for specialist advice on these employment law matters. They are hugely complex. If people want to sell their businesses, what will they have to do to make sure they comply with this law? First they will have to seek specialist advice on all the steps employers have to take under New Part 6A—that is, sections 69(A), 69(B), 69(C), 69(D), 69(E), 69(F), and so on.

On this continuity of employment provision that the union movement has insisted Labour brings back into the legislation—a provision that Labour once had the good sense to dump because it knew it was bad law—I ask the Minister what studies the Government has done on the estimates of compliance costs. It is wrong to impose this huge additional law on our employers without some estimate of what complying with it will cost businesses. I am a registered employer, and I cannot comply with it. How can I expect other ordinary employers to comply with it?

SUE BRADFORD (Green): I feel honour-bound to speak to the amendment put up by the Hon Peter Dunne tonight, which seeks to provide that union access to workplaces may be denied on religious grounds not only when an employer is an individual but also when an employer is, for example, a family company or a charitable trust running a school where all the people involved are members of that religious order.

In 2000 when the Employment Relations Bill was before the House the Green Party supported changing the original bill to allow for this kind of religious exemption where an employer is a practising member of a religious society or order, whose beliefs genuinely preclude them from membership of any other organisation at all in our society. This exemption, of course, as other members have mentioned tonight, particularly applies to the Exclusive Brethren, who I was aware of in our local communities in Rodney and in Northland, and who I felt legitimately met this test. The Green Party backed this change at the time, firstly, on the basis of respecting genuinely held religious beliefs, and, secondly, on the basis that as a huge number of workers were no longer in unions as a result of the Employment Contracts Act, it seemed strange that unions would see a need to focus their efforts on Brethren work-sites, in particular, whereas something like 80 percent or more of the New Zealand workforce were not in a union.

What appears to have happened is that when the Employment Relations Act was passed it was interpreted in such a way that Brethren employers with fewer than 20 staff were granted the religious exemption. However, some time later it seems that the Department of Labour became more precise in its interpretation and withdrew the exemptions in situations where the employer was more than one individual, even though they were still all Brethren. Mr Dunne’s amendment aims at reclaiming the ground that the Brethren feel they have lost since 2000.

The Green Party has considered this matter seriously, and we have had to weigh up the balance between our desire to recognise sincere and long-held religious beliefs, and beside that, our underpinning support for the rights of workers to join a union and collectively bargain to improve wages and conditions. We have decided that, in this case, we will not be able to support the proposed amendment. Firstly, we have taken note of the Brethren claim that they now have a large number of companies—some 800—around New Zealand that make, they say, a large contribution to GDP—and we say good on them. However, they appear to employ a rather larger number of workers than the Green Party had first realised, and many of those workers and teachers are not, in fact, Brethren, so we feel we should not do anything more to close off access to work-sites.

Secondly, the well-known case of the employer in Auckland who sent out a memo banning his staff from using languages other than English in the workplace, and this was in a very multicultural workplace, has, I am afraid, not helped the Brethren cause. Although my colleagues and I are aware, and do acknowledge, that the Human Rights Commission stepped in, and that a good resolution was reached, to the satisfaction of the employer, the staff, and the commission, the incident has left a taint of prejudice and the sense of an employer massively overstepping the mark, and it is hard to dispel that feeling.

Thirdly, while we have no problem supporting the rights of individuals to follow their conscience in choosing whether to join a trade union, or any other organisation for that matter, we say it is another story to in any way widen or strengthen the exemption, given that our fundamental kaupapa is to support the right of workers to organise.

I turn to some of the amendments the Green Party would like to see inserted in the bill. We are very pleased to see that in clause 30 the Government is finally upholding the intentions of clause 66 of the original Employment Relations Bill. I listened with interest to what the previous speaker, the Hon Dr Lockwood Smith said. He claimed that a deal had been done with me, or with the Green Party, in 2000. I am very curious as to what that deal was. There was no deal; we kept fighting the Labour Government on clause 66 of the original bill right to the last moment, as anyone in the House at the time will remember.

Another of our amendments seeks to insert the words “caregiving services” in paragraph (c) of schedule 1A in respect of residential care facilities, so that those workers can benefit from the new protections being offered to some groups of particularly vulnerable workers. The Green Party supports the call of the Service Workers and Food Union that caregivers in rest homes should be included, too.

JOHN KEY (National—Helensville): We should start by calling a spade a spade. The Employment Relations Law Reform Bill is simply a State—

Hon Maurice Williamson: A dog.

JOHN KEY: It is a dog, but it is a State-sanctioned union recruitment drive up and down the country. I draw members’ attention to an editorial in the New Zealand Herald: “Labour Minister Margaret Wilson says she is as much concerned with the 80 percent of workers not covered by collective contracts as those who are.” She is worried, all right. She is worried that they are not part of a union and she wants them in there so that she can have their union dues, she can have them pumping up the Labour Party, and pumping out advertisements around the country. The New Zealand Herald got it right when it stated: “The more you look at the wording of the Employment Law Reform Bill the more worrying it gets. Seemingly innocent clauses from one section, when combined equally with mild-looking clauses in another, suddenly acquire the potential to produce extremely disturbing consequences.” It goes on and on.

Dr Wayne Mapp: You have to read them together.

JOHN KEY: That is right. One has to read them together, and they go on and on. For days the New Zealand Herald looked at this legislation and it could not find a decent thing to say about it. The paper that supported Dick Hubbard could not find a decent thing to say about the Employment Relations Law Reform Bill. It stated further: “Few employers would agree with the Government’s claim that the bill’s provisions support innovation, productivity, and work-skill development. The reasons for this is not apparent when one discerns the major themes that characterise the proposed changes—increased intervention by the State and labour relations, a more prescriptive approach to employment law, moves towards more centralised labour systems, including the possibility of third-party determination of employment terms and conditions, increased union powers and influence, and a desire to collectivise the workforce.”

This bill represents a move back in time for New Zealand. It is not a move that will give higher growth levels to the people of New Zealand. When the Minister took a call he said that he was sick of the tired old rhetoric. He was sick of the National Party coming out with comments and employers telling him it would be bad news, because that is what they told him in the year 2000, and it did not work out that way; and that actually everything had worked out all right. That raises quite a few interesting points. The first point is why it did not have the impact. The reason was that the original Employment Relations Bill introduced in 2000 was gutted. All the things we see in the Employment Relations Law Reform Bill were taken out of the original bill and parked for another day, because it was brought into the House in the “winter of discontent” back in 2000, and the Government was terrified that it was about to go down the toilet, so it ripped that stuff out and parked it for another day. Since then Ross Wilson has been chomping at the bit to get those provisions back into the Parliament. This is just—

Hon Maurice Williamson: The empire striking back.

JOHN KEY: Step by step, incrementally, this bill will take New Zealand back to a less-flexible labour market. Quite interestingly, the OECD actually saw this stuff coming. [Interruption] I hear Lianne Dalziel chirping away there like some sort of canary that is stuck in its cage. The OECD saw it coming in its New Zealand country report. It stated: “Labour market flexibility should be preserved. Recent years have seen a clear trend towards greater rigidities and higher labour costs. Further such changes are in the pipeline.” The OECD could see it coming.

The Minister told the Committee of the whole House not to worry about it, because everything has been great, we have been going at 3.5 percent, and not to worry about the changes to the flexibility in the labour market. Well, I have news for Paul Swain. Maybe he does not understand economics. I can understand that, because Michael Cullen does not know that one plus two equals three. He does not understand that, and if he does not understand basic arithmetic, it is no wonder the Labour caucus is having some problems with growth in the New Zealand economy. I shall tell Mr Swain why the New Zealand economy has been growing. It has been growing, because the exchange rate was highly competitive for a period in 2000 and 2001. It has nothing to do with this Government. It cannot control it, and, in fact, Michael Cullen wants to control it, because he has introduced aspects to now influence the exchange rate, but he is too scared to wheel them out, because he knows that will not work. Secondly, the New Zealand economy grew, because of very strong commodity prices.

DEBORAH CODDINGTON (ACT): I stand on behalf of the ACT party to oppose this bill. The Minister of Labour said before that the ACT party and the National Party had stated that when the Employment Relations Act was introduced it would lead to bigger compliance costs and a downturn in employment. We did say that. The reason that did not happen, as the Minister knows very well, is that the National Party and the ACT party fixed that bill as it went through the House. Now we see all those draconian clauses that were taken out of the legislation being brought back in this legislation.

This is patronising legislation. It tells people that they cannot bargain as a collective if they are not in a union. The State is telling people that they are not capable of forming a voluntary collective to bargain for wages and conditions—they have to belong to a union.

It is also outrageous that this bill is a Trojan Horse for censorship. When we look at the legislation we see that the stating of a simple truth—for instance, that a multi-employer collective agreement holds no benefit for employment—by an employer, as a matter of opinion or as a matter of fact, to an employee is a breach of this bill. It forces employees to conclude a collective agreement, and it ensures, as I said, that employers can be fined for expressing an opinion. That is absolutely outrageous. We cannot let this form of censorship go through the House under the guise of employment law.

The Minister talked about how this legislation will contribute. When this bill was brought in, Margaret Wilson told a meeting that it would contribute to economic growth, and that employment legislation had to follow the New Zealand labour market, which was increasingly dynamic and under-regulated. Under-regulated! If this is under-regulation, if this is the light hand of regulation, then I would hate to see what this Government thinks is heavy regulation. Employers can be subject to fines for breaching the duty of good faith—which itself is a term that has gone so far as to be ill-defined, nebulous, and subjective; in fact, it can mean whatever the judges decide it should mean. Also, the court can impose a contract on them. So employers who might have been bargaining to pay $10 an hour might end up paying $1,000 an hour, or whatever amount the court decides to impose on them. It is impossible for employers to win.

The Minister of Labour made much noise about freeloading. The issue of freeloading is an absolute nonsense. If anything, it is the other way round. The Transport and Industrial Relations Committee heard submissions from employers stating that it is the employers who frequently suggest and propose better terms and conditions, and that the unions freeload off those. So it is the other way round. If we are to talk about freeloading, let us get it right. Freeloading in the way this Government means it is simply a way of introducing compulsory unionism.

I refer now to clause 30, which ensures that those people whom the Minister, from time to time, decides are vulnerable employees—we really do not know what that means—will be treated as chattels. They are to be treated as chattels. We are passing legislation that will treat human beings as the chattels of a business. So when a business is sold—[Interruption] That is what it is; it is Margaret Wilson’s slavery clause.

Jill Pettis: Ha, ha!

DEBORAH CODDINGTON: The chief Labour whip thinks it is funny that people are treated as slaves. When a business is sold, the person who sells the business makes a list of all the chattels. Now, the employees will be chattels.

Hon BILL ENGLISH (National—Clutha-Southland): In some ways this legislation shows the weakness of the union movement, rather than its strength. If there was one thing that I and other MPs underestimated after the last changes to employment relations law, it was the number of New Zealand workers in the private sector who would simply refuse to take part in collective bargaining. That has been the huge disappointment to the Council of Trade Unions and to this Government. When the Government passed the Employment Relations Act, the idea was that the workers down in Winton would line up to have the delegate from Dunedin come and negotiate their agreement, but they did not; they told him to get stuffed and get lost so that they could get on with the job. That is why that legislation did not do all the economic damage that it could have done. It was welcomed in the public sector but not in the private sector.

There was a day when the union movement in New Zealand could organise, and when it could induce faith among working people that their union would do something in their interests. But those days are gone. That is why we have this squirrelly, pathetic, warmed-up, pink-tie unionism legislation. We have debated this stuff for a number of years under Labour. It used to be the diesel-stained hands. It used to be the dirty overalls. Now it is the pink tie. That is why it is not working.

We have lost perspective. Listen to this provision: “even though the union and employer have come to a standstill or reached a deadlock about a matter, they must continue to bargain (including doing the thing specified in paragraphs (b) and (c)) about any other matters on which they have not reached agreement;” We are passing a law—this will be the legislation of the country—that says to people that if they disagree about one matter, they have to negotiate and keep talking about the other one. How pathetic is that! If that is what the Council of Trade Unions says it needs this Parliament to do, so that it can get some members, it has had it—it has absolutely had it.

The legislation says that “The duty of good faith” requires parties “to conclude a collective agreement unless there is a genuine reason … not to.”, and that the genuine reason cannot include the fact that one is opposed to a collective agreement. How pathetic is that! How persuasive is the concept of union power and solidarity, and enhanced productivity in the workplace, if one has to say to the bargainers: “You must agree to a collective agreement, and if you are against one, that is not a good enough reason not to agree.”! The union movement, under the sponsorship of the Minister of Labour, is on its knees. It has increased its membership in the public sector only, and it has been able to do that only because it has had a compliant employer. Who is that compliant employer? That Minister.

I will make this claim tonight: there is no economic case for this measure. What is in this for the workers? Nothing! Economic restructuring has delivered skill shortages, which is the best news for working people in New Zealand for 30 years. They are now in a sellers’ market, and their wages are going up. Businesses need workers, and have to improve pay and conditions to get them. There is no economic case for this bill. The Government has never made a case for this bill. It is simply the Council of Trade Unions worming its way back into office, trying to increase its revenue-gathering capacity with ridiculous ideas like the bargaining fee.

I think the Minister, even in his less lucid moments, would know that freeloading has been legislated for in New Zealand. If he does not understand that, I will explain it to him slowly. In New Zealand one cannot be in a collective agreement unless one is a member of a union. Only a union can negotiate a collective agreement. Then, in typical left-wing fashion, the Government, having legislated one piece of nonsense, has to legislate another to fix it.

Dr WAYNE MAPP (National—North Shore): I want to pick up on a point that Mr English made—that is, the whole idea that the union power now resides in the Government. When the Government has the opportunity to bargain, it actually pays special incentives to people who are members of the Public Service Association—$500 in one case, a one-off payment; $700 in another case; and $600 in yet another case. These payments are authorised by this Government, so we have essentially a bribe sanctioned by the Government to get people into the Public Service Association.

It has had some effect, as we might expect. A bribe has meant that some more people have joined the Public Service Association. The Public Service Association is the only union in New Zealand where membership is growing. No rational private sector employer would agree to such an absurdity. Those employers would not provide bribes in their collective agreements for people to join unions, even given the special powers that the Government is imposing on them. A rational private sector employer would not allow for a bribe, and would not agree to it.

But the craven ministries, under the direction of this Government, are more than willing to do it. That is how they are boosting the membership of the New Zealand Public Service Association and the New Zealand Educational Institute, which of course is now the centrepiece and the power base of the New Zealand Council of Trade Unions. So when Mr English refers to the pink ties, the pink ties he is referring to are all those State employee negotiators—members of the Public Service Association. That party on the other side of the Chamber is littered with former members of that association.

Some people have said that the Minister does not believe in this legislation; I say that the Minister absolutely believes in it. He is a former unionist and union organiser. He might go around to boardrooms and say that the Government is listening to them and is there to help them, but his heart is with the unions. If the unions say that they need those provisions, he says yes. In fact, he made a claim in his second reading speech to provide draconian legislation, so that even if there were just an effect of perhaps some undermining during negotiations, that would be a breach of good faith. A breach of good faith means penal provisions, and that means a fine.

In my Supplementary Order Paper I provide an opportunity for that so-called gang of “Swainy” and his boys to fight for something they say they want—that is, a 90-day probation period for workers. It was carefully gone through, and he has had plenty of notice about it. Now he and his cohorts—Mr Tamihere in particular—have been going up and down the country talking to businesses and saying, yes, that they will provide those probation clauses. The Minister himself actually said in his second reading speech that he would do that. I tell him that I am giving him that opportunity. He can vote for it in this Committee stage. The probationary period is limited to 90 days; it is limited to first-time employees; and it does not remove all protections. The usual human rights protections are all there. But it does give a trial period. It is the sort of thing that would give young people—that additional 4 percent unemployed—a real opportunity to get more jobs.

Now we know that that 4 percent unemployed are the people who find it more difficult to get jobs. They are the people who have the tattoos. They are the people whom many employers might blanch at when they first see them. So we are saying: “OK. We are giving the opportunity to you to take a chance.” That chance is not wanted by just the employers; it is wanted by those young, and not so young, people. The Minister tomorrow, when we reach the votes, could vote for precisely the very thing he has been talking about. That would be proof that he is listening to business. That would be the real test. It would be the only bright spot in this legislation.

Hon RICHARD PREBBLE (ACT): I want to draw the attention of the Committee to another matter contained in the bill, which is the decision to overturn the Oram decision. The Oram decision was a litigated piece of law between the New Zealand Herald and Mr Oram, that went all the way to the Court of Appeal. The trade unions lost that case, and the law has now been established. Having lost the case, they came to the Transport and Industrial Relations Committee and asked for the law to be changed.

I say to the Minister that he should have established why that case should be overturned, because after the judges had listened to the matter very carefully, their view was that providing the employer thought the action was reasonable, it should be able to stand. Now the test is not what the employer thought was reasonable but, basically, what this Government thinks is reasonable.

Lianne Dalziel: If it’s a reasonable employer.

Hon RICHARD PREBBLE: Well, I say to the member that that invites litigation. I think it is a very bad principle when we have a section in a law that says we are overturning a particular court case.

I make the point to the Government that those members must have noticed and have heard the criticism, that there are far too many cases where people—

Hon David Carter: I raise a point of order, Mr Chairperson. I raise this at the earliest opportunity, as I did not get the last call. I want you to give some consideration to access to the lobby area and particularly to the main meeting room that is normally available for members of Parliament and the officials. I want you to consider the appropriateness of Ross Wilson, president of the Council of Trade Unions, being in that lobby room and then proceeding into the Chamber.

The CHAIRPERSON (Hon Clem Simich): I thank the member for raising that. It will be considered, but at this point I must report progress. We will raise it with the Speaker tomorrow.

Progress reported.

The House adjourned at 9.57 p.m.