Wednesday, 29 March 2006
Volume 630
Sitting date: 29 March 2006
Wednesday, 29 March 2006
Wednesday, 29 March 2006
Madam Speaker took the Chair at 2 p.m.
Prayers.
Members’ Bills
Members’ Bills
Hon Dr MICHAEL CULLEN (Leader of the House): Following agreement in the Business Committee yesterday, I seek leave that:
(a) notwithstanding Standing Order 277(1), if,
(i) whenever the Clerk is to conduct a ballot under Standing Order 277(2), or
(ii) on a Wednesday on which Government orders of the day take precedence,
it appears that there will not be four orders of the day for the first reading of members’ bills available for consideration at the next Wednesday’s sitting at which members’ orders of the day take precedence, the Clerk may accept notices for the introduction of members’ bills so as to bring the number of orders available that day up to four, and
(b) this order expires on 31 March 2007.
I will very briefly explain that so that other members who are not on the Business Committee understand it. There have been difficulties on occasions with not having four members’ bills available because some members’ bills have been postponed. The Business Committee thought it would be a good idea to try this for a year as a sessional order, see how it goes, and the House can return to that matter next year if it works as well as we expect it to work.
Madam SPEAKER: Is there any objection to that course being followed? There is no objection.
Speaker’s Rulings
Questions for Oral Answer—Quotations
Madam SPEAKER: I undertook last week to reflect on answers made by Ministers quoting reports that they have seen—sometimes reports of remarks made by Opposition members.
Questions often contain quotations and ask a Minister to respond to the quotation. This is a long-established practice; indeed Speaker’s ruling 147/4 records a Speaker as long ago as 1970 bemoaning the fact that quotations are permitted in questions. As long as the quotation relates to public affairs with which the Minister is connected or to a matter of administration for which the Minister is responsible, it can be put to the Minister and it does not matter whose quotation it is. If quotations can be included in questions, then they can be included in answers, for the rules as to content are virtually identical—compare Standing Order 371(1) and Standing Order 377(2).
There is thus nothing wrong, in principle, with a Minister in a reply quoting an Opposition member as long as the quotation relates to public affairs with which the Minister is connected, or to a matter of administration for which the Minister is responsible. Thus, a Minister may be asked a question about what reports the Minister has received relating to the Minister’s area of responsibility. In replying, the Minister may quote another person’s statement if it does relate to that area of responsibility. But the Minister may not comment on Opposition policy, as the Minister has no responsibility for it—see Speaker’s ruling 139/6.
On the other hand, a Minister may be asked a question that quotes a statement relating to the Minister’s area of responsibility—even an Opposition statement—and seeks the Minister’s opinion of it. In this case the right to seek a Minister’s opinion on public affairs with which the Minister is connected allows the Minister, when asked to do so, to comment on a statement relating to such matters regardless of the origin of the statement.
This ruling will, of course, be available for members to be able to look at. I hope it does provide some guidance on these matters when questions are asked and answered.
Motions
New Zealand Commonwealth Games Team—Recognition
KEITH LOCKE (Green): I seek leave to move without debate, except for brief comments from the parties, members’ notice of motion No. 4 on the Order Paper.
Hon Dr MICHAEL CULLEN (Leader of the House): I raise a point of order, Madam Speaker. We had notice that this motion was to be moved without debate. If you recall, we had a discussion in the Business Committee around this matter. Obviously, given the nature of the subject, we will not be refusing leave. But, for the future, members should be very well aware that the Business Committee is asking us to return to the notion that “without debate” means without debate. If one wants debate, then one does not ask for the motion to be without debate.
KEITH LOCKE (Green): As I understand it, “without debate” means that the motion does not go through the normal procedure.
Madam SPEAKER: No, it means no comment at all. It means just moving the motion, and the House agreeing to it. There is no further comment.
KEITH LOCKE: I think the House can grant leave for whichever course it wants. In my experience in the House, basically there are three courses. The first is to have a formal debate with 10-minute speeches. The second is for the member just to move the motion. The third is to have just brief comments from party representatives, and I think it would be wrong to rule out that intermediate course.
Madam SPEAKER: It is for the House to decide. I am merely clarifying that the member has sought leave for, in effect, brief comments to be made.
Hon Dr MICHAEL CULLEN (Leader of the House): What I am saying is that we were informed that the motion was to be moved without debate, and, pursuant to the Business Committee’s discussion of this matter, we assumed there would be no comments. The member has sought leave, and clearly we will not refuse it in the circumstances. I simply draw the House’s attention to the fact that the Business Committee discussed this matter, for future reference and understanding, of when leave is being sought by discussion with the whips. In other words, if one is seeking leave to discuss something without debate, it means that. If one wants to seek leave without debate but with brief comments, then that is what must be indicated to the whips around the House—not without debate.
Madam SPEAKER: I will put the leave that has been sought, which is for brief comment. Is there any objection? There is no objection.
KEITH LOCKE (Green): I move, That this House express its pride in the performance of the New Zealand Commonwealth Games team in Melbourne, and recognise the long hours of training put in by our sportsmen and sportswomen in their preparation for the Games. The Green Party, along with, I think, all parties in this House, congratulates all of our sportsmen and sportswomen on their performances. They all put in very long hours to prepare for the games, and I am sure they did their best. We particularly congratulate the 31 medal winners, but I do not think we should get hung up on our medal tally, or on our gold medal tally. For example, Dean Kent, a longstanding swimmer, did fantastically well to achieve a personal best in the 200 metre individual medley. There is no shame at all in his getting only a silver medal. I think it is in that tradition that we should support all of our team and not succumb to some of the armchair critics who only watch the games on TV every couple of years. We really need to support our sportsmen and sportswomen into the future.
Hon Dr MICHAEL CULLEN (Deputy Prime Minister): On behalf of the Labour Party, might I say how much I endorse those comments. There is no shame in being No. 2 in an excellent team. I will point out that only one country smaller than ours actually won more medals than we did, and that was Jamaica. Given that country’s crime rate, I would not swap our slightly lower medal count in that respect.
Hon MURRAY McCULLY (National—East Coast Bays): I would like to associate the National Party with the congratulations conveyed in the resolution that has been moved. In particular I congratulate those who were successful in winning medals at the Commonwealth Games. It has been a matter of some comment that the medal tally was somewhat short of the aspirations expressed at the outset of the games. On that matter I simply commend to the House that this is a time when an orderly review process will be undertaken. It should be noted that a substantial commitment of taxpayers’ money was made to support the team. No doubt officials will be filing their reports and a review process will ensue that will enable us to ensure that every possible step is taken to improve our performance in future games. I urge those who are interested in that matter to wait for that process to take its course.
RON MARK (NZ First): As New Zealand First’s spokesperson on sport I rise to indicate that New Zealand First supports the intent of this motion. But we have to say, from where we sit, that coming third often makes one the winner, and that is quite a bizarre situation, is it not? And long may that continue to be the case.
There have been some winners in the Commonwealth Games and I do not think—[Interruption] Well, Maurice Williamson gets gold for “Yap of the Month”, or “Mouth of the Month”, but we will move on from that. We have to move on and recognise an outstanding young lady who made it very clear what her intentions were, and they were to win. In my background in the military it was often said that second was the first loser. However, Valerie Vili had no intention of losing, and special congratulations need to go to her on her mammoth effort in bringing home gold for us.
Minister Mallard has quite rightly signalled to the sporting fraternity in New Zealand that the country that spends money on, and the taxpayers who put money into, the Commonwealth Games and the Olympic Games do expect a result, and I have no doubt that everybody will be scrutinising not so much the athletes but the sports administration. Some may say that the focus should start with the athletes, but others will suggest that we need to look at the administration of New Zealand sport—the selection of coaches, and the process by which people become leaders, coaches, and administrators. Maybe the House, through its select committees, might like to pay some attention to those areas, in time.
Finally, I think that if a gold meal were to be given out to anyone in this House, it would go to Mr Keith Locke for being the winner of “Prat of the Year” for the way in which he ambushed Tony Blair yesterday—
Madam SPEAKER: No, no. That is not appropriate.
Rt Hon WINSTON PETERS (Leader—NZ First): I raise a point of order, Madam Speaker. The jeering and barracking from the National Party is, again, unacceptable. I know that some of them are denied speaking chances in question time, but they should not make up the shortfall with general barracking and shouting in the House. We just had a very good example: when Ron Mark was finishing, one could barely hear a word. If members cannot keep quiet in a debate on a motion, heaven help us when it comes to other more serious parts of discussions in the House.
Madam SPEAKER: I thank the member.
HONE HARAWIRA (Māori Party—Te Tai Tokerau): The Māori Party joins with all others in congratulating our Commonwealth Games team on their success at the Melbourne games. We also note that hundreds of millions of dollars were spent on the sports; that we brought back, I understand, about half a dozen gold medals; and that we have just finished participating in the 2006 Waka Ama IVF Va’a World Sprint Champs, from which Aotearoa brought home 20 gold medals for a miserly support allocation of $150,000. I thank the Minister of Māori Affairs and the Minister of Youth Affairs very much for their support in that initiative. Perhaps this House might recommend to the authorities that fund such sports that given that the nation’s feel-good factor is improved by the success of our sports teams, considerably more support should be given to Ngā Kaihoe o Aotearoa, the New Zealand waka ama federation, in its bid to be even more successful at the next world waka ama championships in Sacramento, California in 2008.
Hon PETER DUNNE (Leader—United Future): United Future joins with others in supporting the motion congratulating the athletes on their achievement and wishing them a safe return to New Zealand. We note and lament the fact that no sooner had the games ended than our country once again indulged in the ritualistic self-flagellation that follows every Commonwealth Games, Olympic Games, and Rugby World Cup about why we did not do as well as we should have, and what we need to do better next time around. Frankly what we need to do is give our athletes a chance and stop this mindless bickering and criticism of their performances.
HEATHER ROY (Deputy Leader—ACT): The ACT party also joins other parties in this House in supporting Mr Locke’s motion. Some may well have wondered why the Government did not, in fact, bring the notice of motion, and I thank Mr Locke very sincerely for doing so.
All of the New Zealand athletes at the Commonwealth Games were winners. They are athletes who have always trained hard. New Zealand athletes have always prided themselves on training hard and doing their very best at international competition such as this. The ACT party thought that some very unfortunate comments were made, not only in the media, but by members of this House—unfortunate comments, indeed, to people who have spent a lot of time and effort in their individual codes.
New Zealanders do celebrate success but they also celebrate the fine effort that we saw from the New Zealand athletes at the Commonwealth Games. I would say that there is no shame in being the fourth best in the Commonwealth at any sport. I would also say that if New Zealand was ranked No. 4 in the OECD, this country would really have something to celebrate.
Motion agreed to.
Points of Order
Speaker’s Ruling—Questions for Oral Answer
GERRY BROWNLEE (Deputy Leader—National): I raise a point of order, Madam Speaker. We have had a couple of minutes now to think about the ruling you brought back to the House at the start of the afternoon. The unanswered part for us though remains as to whether the question that led to this ruling would, by the ruling, be in order. That was the question from Dr Nick Smith to Dover Samuels in which he was asking the Minister to comment on a report and, indeed, on quotes from that report, made by the Minister himself, but apparently in a different capacity. It seems that we should get an answer to that because the frustration that came from the rejection of that question on the day led to Dr Smith being out of the House for an extended period of time. After thinking about your ruling, it would appear that Dr Smith’s question was, in fact, in order.
Madam SPEAKER: That question, as I recall it—and I am happy to look at it again—was on a different issue relating to the capacity in which the question was being answered. But, as I said, I am happy to look at that for you. But my understanding was that a whole lot of questions were around quotations as well, and that is what I was addressing there. So I will look at that for you.
GERRY BROWNLEE (Deputy Leader—National): We would appreciate you coming back to the House with that.
Madam SPEAKER: Yes I will certainly do that; no problems at all.
Questions for Oral Answer
Questions to Ministers
New Zealand Qualifications Authority—Scholarship
1. Hon BILL ENGLISH (National—Clutha-Southland) to the Minister of Education: Did the New Zealand Qualifications Authority implement 2005 Scholarship competently?
Hon STEVE MAHAREY (Minister of Education): Yes, the 2005 scholarship exams were a vast improvement on those of 2004. The exam season went smoothly and the scholarship results and distribution of awards have been fair. After the problems of 2004 I believe that there is now a solid platform for ongoing improvement of the system. Scholarship is about recognising and rewarding excellence, and that is now happening.
Hon Bill English: Why, then, did the New Zealand Qualifications Authority approve a calculus exam where 50 percent of the students scored less than 5 percent and students who scored 18 percent won a scholarship, and a visual arts exam where 8 students who scored 100 percent—that is, full marks—were not awarded the top award?
Hon STEVE MAHAREY: Those are, of course, very good questions, and these are the answers. The answer to the calculus question is that I am advised that the level of achievement in calculus scholarship has been an issue for quite a number of years, but that scaling under the previous system meant it did not show up. I understand that the New Zealand Qualifications Authority and the scholarship advisory group have met with the calculus examiner to revise this year’s exam to ensure that more students can at least attempt the exam, while maintaining their high standard for scholarship. I am assured, however, that for this year the right students were awarded scholarship in calculus. Because the question is important, let me answer the other part of it as well, which is the visual arts question. Scholarship is awarded to a target percentage of students, to ensure a fair distribution of awards. In visual arts, the marking scheme made it a straightforward exercise to rank the top 25 students in order to identify the top 18 scholarship students.
Hon Bill English: And they all got 100 percent.
Hon STEVE MAHAREY: Given the number of students who got zero—if Mr English could be quiet just for a moment—I understand that the Ministry of Education will review the current requirement to achieve excellence in the National Certificate of Educational Achievement at level 3, which is currently a co-requisite of being able to get scholarship. That is a problem, and that is something the ministry will review, because it seems to me, as I am sure the Opposition member would say, that it is impediment to people getting through to scholarship. Perhaps it should go.
Moana Mackey: What measures have been taken to ensure scholarship results are fair and consistent?
Hon STEVE MAHAREY: Following the issues of 2004, the New Zealand Qualifications Authority implemented recommendations from several inquiries and engaged independent expertise, including the internationally recognised assessment experts Gary Hawke, John Hattie, and Terry Crooks. Last year the Scholarship Reference Group, which involved representatives from the Post Primary Teachers Association, the New Zealand Principals Federation, colleges of education, the Secondary Principals Association of New Zealand, and the Principals Council, made 25 recommendations to Cabinet for improvements to scholarship. Examples of improvement include the thorough process of daily checking and double-checking of marking processes, and a fairer system of distribution of awards to target percentages of students. The independent experts have gone on record as saying they are confident the results and distribution of awards for scholarship were robust and trustworthy.
Hon Bill English: If the process is so robust and trustworthy, why, then, did the New Zealand Qualifications Authority, in the last few weeks, award two extra premier scholarships worth $10,000 a year to two students who correctly complained that the New Zealand Qualifications Authority had altered the criteria for that premier academic award without telling anyone?
Hon STEVE MAHAREY: I am advised that the New Zealand Qualifications Authority did not clearly explain that three outstanding scholarships was a minimum requirement for a premier award. Two students who received three outstanding scholarships felt that they had been led to believe they would get premier awards. The New Zealand Qualifications Authority has now agreed to that, and we are making those extra awards.
Moana Mackey: What other feedback has he had on scholarship?
Hon STEVE MAHAREY: I have seen many reports and messages expressing confidence in scholarship in 2005. One states: “We are confident that the right students got scholarship.” The other states: “People should be considerably reassured about scholarship.” The third claims: “The 2005 results show the range of scholarship marks are far more sensible than in previous years.”, and a fourth stated that: “No doubt there has been an improvement on last year.” The first quote is from Gary Hawke, the second is from Paul Baker, the rector of Waitaki Boys High School, and the third and fourth are from Bill English.
Hon Bill English: Given that two students have now been awarded separately scholarships worth $10,000 a year because they correctly complained about the New Zealand Qualifications Authority secretly changing the criteria, how many other students could pick up $10,000 a year by writing in and complaining about the same ridiculous and incompetent error on the part of the authority? What does the Minister think that those students think about his administration of the whole thing?
Hon STEVE MAHAREY: I go back to the answer I gave before, because the New Zealand Qualifications Authority has been clear about this.
Hon Dr Nick Smith: Just answer the question.
Hon STEVE MAHAREY: I am answering the question. I am advised by the New Zealand Qualifications Authority that it did not clearly explain that three outstanding scholarships was a minimum requirement for the premier award. That involves two students. This was not secret. It was a mistake in the authority’s explanation, and no other students will be eligible.
Allan Peachey: Is the Minister concerned that worrisome difficulties with scholarship examinations for some subjects over the last 2 years have undermined the drive towards higher academic standards by our top secondary school students?
Hon STEVE MAHAREY: No.
Allan Peachey: Have the problems that have come out of the last 2 years of scholarship examinations been caused by the Government’s requirement that the New Zealand Qualifications Authority use a standards-based methodology for scholarship, when, in fact, that may not be the most suitable methodology to identify the top New Zealand secondary school students in this case?
Hon STEVE MAHAREY: That is a very good point. One of the things that has happened since last year is a change in the system of assessment, which had tried to find the best of the best but did not seem to do that. That is why we have the 25 recommendations, that is why there has been the change this year, and that is why everybody except the lone critic opposite believes we have made major advances, and are still doing so.
Hon Bill English: Can the Minister confirm that the two students who received the premier award worth $10,000 a year did so because the students themselves noticed that the criteria on the New Zealand Qualifications Authority website back in November were different from the criteria on the website in March of this year, that the authority did not pick up the problem and did not demonstrate good faith, and that it was not until the students picked up the problem and approached the Opposition and the authority that they were awarded the $10,000 scholarships, which they should have got in the first place?
Hon STEVE MAHAREY: I think what I have said already is the answer to the question. The member can keep asking it, but I will give him the same answer. The New Zealand Qualifications Authority has made it clear that it thought it had explained the minimum requirements clearly. I confirm what the member said: the two students approached the New Zealand Qualifications Authority, which, in good faith, said yes, they had a right to say those things. It said it would change that, and they would now get the scholarships.
Working for Families Package—Outcome
2. DARIEN FENTON (Labour) to the Minister for Social Development and Employment: How is the Government’s Working for Families package supporting hard-working Kiwi families?
Hon DAVID BENSON-POPE (Minister for Social Development and Employment): From this Saturday three out of every four New Zealand families with dependent children will be entitled to tax credits through Working for Families. From Saturday a family on the average family income with two children will be better off by $90 a week. That also means that, in total, they would be $116 better off since 1 April 2005. Labour is targeting tax credits where they are needed for hard-working Kiwi families with children.
Darien Fenton: What is the Government doing to ensure that work pays?
Hon DAVID BENSON-POPE: The Working for Families package is designed to make work pay, and to achieve a social assistance system that supports people into work. From Saturday the main work incentive parts of the Working for Families package are being rolled out with the new in-work payment, changes to the abatement of tax credits, and an increase to the family tax credit threshold. The in-work payment replaces and pays more than the child tax credit. It pays up to $60 a week per family with three children, and up to $15 a week for each other child. Couples must normally work 30 hours a week between them, and sole parents must normally work 20 hours a week.
Tariana Turia: What advice has been sought from Associate Ministers Horomia and Okeroa about the implications of the Government’s Working for Families package not reaching the estimated 63,000 Māori families who are the poorest families with children and who get no benefit from this package?
Hon DAVID BENSON-POPE: I certainly do not accept the member’s proposition. Very extensive advertising has been put in place to ensure that people are aware of and are receiving their entitlements.
Heather Roy: Does the Minister believe that a back-bench MP with five children, like myself, should qualify for additional welfare payments; if so, why?
Hon DAVID BENSON-POPE: I do believe that the application of support of this kind should be done fairly. The unfairness of any other application is obvious. Across-the-board tax cuts, as suggested by the ACT party, for example, give no regard to circumstance, and deliver the biggest benefits to the people with the largest incomes.
Heather Roy: I raise a point of order, Madam Speaker. The Minister made absolutely no attempt to answer my question, which was very specific.
Madam SPEAKER: The Minister might like to clarify what he was saying.
Hon DAVID BENSON-POPE: I would simply add that if that member has an entitlement and has enough children, then she should quite properly receive those payments.
Hon Dr Michael Cullen: Will the Minister tell the member who asked that question that if she feels embarrassed about receiving those payments she does not have to apply for them?
Hon DAVID BENSON-POPE: It is certainly the case that people need to make application for those support payments. If that member were, indeed, not deserving of them, then I assume she would not apply for them.
Darien Fenton: What is the effect on child poverty of Working for Families?
Hon DAVID BENSON-POPE: Working for Families is a significant investment in the well-being of New Zealand families with children. The majority of the poverty alleviation measures in the Working for Families package were put in place in 2005, although the further increases in family support rates in 2007 will have a further impact on child poverty. Using an income poverty measure of 50 percent of median household income, I am advised that after the full implementation of Working for Families, child poverty in New Zealand will be reduced by 70 percent.
Craig Foss: Is it fair that a hard-working Kiwi with no dependants who earns $25,000 per year, or only $480 per week, has some of his or her tax redistributed as part of the Working for Families package to someone earning up to five times that amount; if so, why is it fair?
Hon DAVID BENSON-POPE: Yes, I think it is fair. I would like to share with the member this quotation: “I don’t think of Working for Families as a welfare programme. Many people in employment also receive money from Working for Families, so we have said clearly that what has been rolled out so far will be continued with, and we’re likely to roll out much of the rest of the programme as well.” Those are the words of former Reserve Bank governor and National Party leader Don Brash last year.
Working for Families Package—Income Limits
3. JOHN KEY (National—Helensville) to the Minister of Finance: What is the highest annual income a family could earn after 1 April 2006 and still receive a payment under the Working for Families package?
Hon Dr MICHAEL CULLEN (Minister of Finance): That depends on the number and age of children in the family.
Gerry Brownlee: I raise a point of order, Madam Speaker. The Minister certainly addressed that question, but the Standing Orders require him when addressing a question to give an answer that is in the public good if he can. A maximum figure exists, and he knows that—a maximum number of children, and a parameter around the circumstance that creates that figure. He was asked to give it. It may be embarrassing for him not to know it, but if he does know it and has it in front of him, he most certainly should tell the House.
Hon Dr MICHAEL CULLEN: Somebody may conceivably—I did not mean that as a pun, sorry—have 20 children. At that point that person would get significantly more than somebody who has two children.
Madam SPEAKER: I think the Minister did actually address the question.
John Key: I hate to tell the Minister this, but one could not have 20 children and still be within the eligible age group, but anyway—
Madam SPEAKER: Just ask the question. [Interruption]
John Key: Well, I suppose if one had quintuplets—
Madam SPEAKER: We will have none of this conversation; we will have a question and an answer.
John Key: Is the purpose of his Government’s TV commercial depicting a family living in an $800,000 house in New Zealand’s wealthiest suburb, with parents who think it is value for money to text their teenage daughter sitting 20 feet in front of them and listening to her iPod that dinner is on the table, to ensure that these needy families enrol in his “welfare for everyone” package; if not, what is its purpose?
Hon Dr MICHAEL CULLEN: It seems extraordinary to me that a member who proposed tax cuts that do not reach their maximum amount until one earns at least $100,000 a year now objects to the possibility that somebody on $100,000 a year with kids will get targeted tax relief. Let me add that it may be news to the member but there are things like reconstituted families in New Zealand, and it is quite possible that one could have 20 children under the qualifying age. That may be beyond his dreams in life, and it is beyond my expectations, wishes, or even fears, but it can happen.
Steve Chadwick: Has the Minister seen any reports suggesting alternative approaches to targeted family tax relief? [Interruption]
Madam SPEAKER: If those members wish to remain here in question time, would they please be quiet. Members are entitled to have their questions heard in silence.
Hon Dr MICHAEL CULLEN: I have seen reports of a package that would have a two-income family with no children and a combined income of $150,000 receive over $120 a week, but, under the same package, a two-income family on $50,000 with children would get only $16 a week, and the cost would be $11 billion over 3 years. That was the National Party’s tax package. [Interruption]
John Key: I hate to tell the seals that the numbers are not correct. Is it still the aim of the Working for Families package to make work pay and to address poverty, as he would recall was stated in 2004; if so, is he surprised to find that a recent Treasury report from officials from Treasury, the Inland Revenue Department, and the Ministry of Social Development states that the extension of Working for Families has very mixed work incentives and will not do anything to alleviate poverty, because, as we all know, the extension of Working for Families is focused on higher-income families, and, as a general rule, those living in $800,000 houses in Epsom are not deemed to be in poverty?
Hon Dr MICHAEL CULLEN: The purpose of this programme is certainly not simply to deal with issues of poverty, though we make no apologies for reducing by, I think, something like two-thirds the number of children living in poverty in New Zealand, as a result of this package. If, of course, the member in his house worth however many million dollars is saying that living in a $800,000 house in Auckland makes someone one of the super-rich, then I think he should do a bit more door- knocking.
Rt Hon Winston Peters: In respect of the comments of the Minister of Finance on a report of a $11 billion tax package over 3 years, did that tax package go with a proposal to borrow to make it possible; if that is the case, how irresponsible is that?
Hon Dr MICHAEL CULLEN: In the package that I referred to?
Madam SPEAKER: Could the member please just clarify.
Rt Hon Winston Peters: I will rephrase my question. In respect of those reports of $11 billion over 3 years in respect of a particular party’s tax package, was it also in the report that such a proposal would require significant borrowing to enable those tax cuts to happen; and how irresponsible is that?
Hon Dr MICHAEL CULLEN: The package that I referred to was predicated upon increased borrowing. That was admitted at the time.
Hon Dr Nick Smith: I raise a point of order, Madam Speaker. I listened very carefully to the ruling you gave less than 10 minutes ago. In that ruling you said quite specifically that Ministers could comment on quotes of members of the Opposition but not on their policies. It seem extraordinary that we have now had three answers from Dr Cullen that breach the very Standing Order and Speaker’s ruling that you have just given. I wonder whether the same rules apply to the Deputy Prime Minister as to others in the House?
Rt Hon Winston Peters: Madam Speaker, you have just addressed that in your first comments this afternoon, when you said that reports of another party’s policy coming to a Minister’s attention could be mentioned in an answer. I am asking about the 2005 policy that National Party members campaigned on. They designed a plan to borrow significantly to give tax cuts. They admitted it then; why do they not admit it now?
Madam SPEAKER: The key issue is that the reports and the quotes that are sought must be within the Minister’s responsibility. It is not the Minister’s responsibility to comment on another party’s policies.
Rt Hon Winston Peters: I raise a point of order, Madam Speaker. What was asked of the Minister in an earlier question was whether he had received any other reports. The Minister got up and rightly said that, yes, he had—he had heard of one that involved tax cuts of $11 billion over 3 years. I am just asking whether, as part of that package, borrowing was involved to enable it to happen—and, of course, it was.
Gerry Brownlee: The first point is that this question is a long way from the original question that was set down on the sheet, which deals specifically with the Working for Families package. We know that Dr Cullen has mentioned the figure that Mr Peters now mentions, and we know that that clearly is the Government’s plan for the day. But perhaps we could get to a point where Mr Peters might modify his question by asking whether Dr Cullen has seen a named report—and perhaps he could name it, given that he has seen it—in which these two matters were traversed. That may get us closer to it. But I suggest, Madam Speaker, that the question as it stands, and as it has been amended, is a long way off the wicket when you line it up against the original question.
Hon Dr MICHAEL CULLEN: It seems to me that we have to be fairly careful here. Let me take two hypothetical questions. First, has the Minister seen the report of proposals by Federated Farmers to exempt farm dogs from proposed microchipping? I am sure the Opposition would wish that question to be asked and answered. Second, has the Minister seen reports by the National Party supporting the exemption of farm dogs from microchipping? Are we now to say that we cannot answer the second question, because the National Party said it—but we could answer it if Federated Farmers had said it? That would become an absurdity. I am not responsible for National Party policy, but I am certainly responsible overall for taxation policy, in conjunction with my colleague Mr Dunne, and I am responsible for commenting on any proposals that are put forward for changes to the taxation system.
Madam SPEAKER: Yes, and, of course, if opinions are sought, that is perfectly acceptable within the Standing Orders.
Gerry Brownlee: Except, Madam Speaker, you are also, surely, constrained by the intention of the primary question in the first place, which asked about the Government’s Working for Families package. To allow the question to be turned round, and have the Minister who is proposing the package answer questions about what he may or may not perceive to be an alternative to that package, is a heck of a long way off the mark from the first question.
Madam SPEAKER: It still relates to the package, though. As long as it relates to the primary question, it is in order. But I agree that one cannot extend it too far. Can I ask the Minister to address the question, please.
Hon Dr MICHAEL CULLEN: The point of the question was what, Madam Speaker?
Madam SPEAKER: Perhaps the member would like to rephrase the question in a manner consistent with the comments that have been made.
Rt Hon Winston Peters: I will ask the question—[Interruption] Well, if you do not like your policy, do not go campaigning on it. [Interruption] That member is the biggest lightweight there has ever been in this Parliament.
Madam SPEAKER: Would members stop chipping across the Chamber. Would the member please just ask the question.
Rt Hon Winston Peters: Did the Minister, who in answer to an earlier question referred to $11 billion of tax cuts—at the highest level, a cut of $120 a week for somebody on $150,000—also learn that that total cost of $11 billion would require borrowing by a Government to enable such a tax policy to work?
Gerry Brownlee: I raise a point of order, Madam Speaker. You surely cannot let that question stand.
Madam SPEAKER: Yes, I am going to. I am sorry.
Gerry Brownlee: Well, Madam Speaker, I will put it to you this way. That question asks the Minister of Finance to comment on a hypothetical figure of $11 billion of tax cuts. We would assert that that figure is quite wrong, that those figures are wrong, and that the report itself came out of the Labour Party research unit and nowhere else. Dr Cullen has now been asked to comment on, effectively, a Labour response to an initiative moved by the National Party in the election. That has nothing to do with the actual programme that the Government has coming into place on Saturday. I think it is quite wrong of you to allow this question to be diverted to a point where the Minister of Finance, rather than answering questions about his own policy, is now reflecting on a Labour report about whether the Opposition’s policies going into the last election were affordable.
Madam SPEAKER: I thank the member, and I have some sympathy for him, but unfortunately hypothetical questions have been permitted since 1995. If members would like the Standing Orders to be changed, then I invite them to refer the matter to the Standing Orders Committee. It was a hypothetical question. Would the Minister now please address the question.
Hon Dr MICHAEL CULLEN: It is my understanding that that package implied a significant amount of borrowing—some billions of dollars—and my position as Minister of Finance—[Interruption] It was $3.5 billion of additional borrowing, to be precise, and that was accepted at the time and appeared in the publication, in the original version of the policy. But my view is quite clear: while borrowing can be justified for some capital expenditure, borrowing for tax cuts is particularly stupid fiscal policy.
John Key: When will—[Interruption]
Madam SPEAKER: If members wish to remain in the Chamber for question time, they will not interrupt members who are asking a question. Everyone is on a last warning.
John Key: When will the Minister finally admit the truth, which is that Helen Clark ordered the extension of this welfare package to higher-income New Zealanders, not because she thought that group needed saving from poverty or from food banks, but, rather, because she had seen Labour’s own polling that National’s popular tax message threatened her own political survival, and, by the way, she could not trust her Minister of Finance, who had made such a botch-up of Budget 2005?
Hon Dr MICHAEL CULLEN: It seems very strange that I am still here, and so, of course, is the Prime Minister, and that member is still on the Opposition benches! The main purpose of the extension of Working for Families was to lift significantly the threshold at which abatement began, and at the same time lower the abatement rate. The effect of that was to apply significant additional incentives for moving into paid employment, because in fact there was a much smaller reduction in earned income as a consequence of the change to the package. Secondly, in New Zealand we have a very poor level of horizontal equity in our system compared with many other countries, and improving that situation can be achieved only by pushing the Working for Families package further up the income scale. I invite members opposite to go knocking on the doors of families who are on $80,000 and have two or three kids, and tell them that they should be paying the same net amount of tax as a single person earning $80,000 a year.
John Key: Is it a coincidence that the Working for Families extension is being rolled out on April Fool’s Day, and did the Government choose that day because it is treating as fools the literally hundreds and thousands of low and middle income New Zealanders who are not eligible for Working for Families who will see their taxes used to prop up families earning as much as $142,000 per year—the needy families that Helen Clark has identified in the extension of her package—and can he now understand why those very-low-income single earners are a little miffed about all this?
Hon Dr MICHAEL CULLEN: Not particularly, no. Of course, the reason why the date is 1 April—as the member could know, if he had spent a little longer in this country—is that that is actually the beginning of the tax year.
John Key: Does he think the architect of New Zealand’s welfare State, Michael Joseph Savage, would ever have foreseen a time when a family in the top income decile with all the toys, from iPods to a $4,000 fridge, would be considered in dire enough straits to be eligible for a welfare handout?
Hon Dr MICHAEL CULLEN: Yes. Mr Savage and of course Sir Walter Nash—particularly Nash—introduced a universal family benefit in 1946.
Greenhouse Gas Emissions—Agriculture
4. METIRIA TUREI (Green) to the Minister of Agriculture: What proposals does the Government have to decrease the greenhouse gas emissions from agriculture, given that they account for 49 percent of New Zealand’s total greenhouse gas emissions?
Hon JIM ANDERTON (Minister of Agriculture): Cost-effective technologies to reduce agricultural emissions are currently limited. The Government’s strategy is to find new technologies and prove their effectiveness. This requires, of course, research. This research has been under way for some time, under an industry-Government partnership, known as the Pastoral Greenhouse Gas Research Consortium, that currently has a budget of $3.6 million a year. There are a number of promising options, many of which both reduce greenhouse gases and increase productivity. As the member will be aware, the Government is currently undertaking a comprehensive review of climate change policy, including agricultural emissions. Decisions will be made this year on the future direction of climate policy.
Metiria Turei: Is he not concerned that all his good proposals and ideas are being undermined by the conversion of 1,200 hectares of forestry land to pasture each year for the next 20 years by the State-owned enterprise Landcorp, when the annual carbon cost of this conversion is about 1 million additional tonnes of carbon per year?
Hon JIM ANDERTON: Landcorp, of course, is a State-owned enterprise operating commercially within the same environment as other private landowners. The Government is concerned that investment decisions around land use in New Zealand do not currently take into account the effect on New Zealand’s greenhouse gas emissions. That goes for both State-owned and private enterprises. This issue is one that is being actively reviewed and considered with the climate change policy review. However, it is important that we develop policy that helps people to make the right choices for the social, environmental, and economic well-being of New Zealand.
Dr Ashraf Choudhary: What reports has the Minister seen on the issue of greenhouse gas emissions?
Hon JIM ANDERTON: I have seen a report from the leader of the National Party, which stated: “I am one who thinks the science of climate change is debatable.” This view is contrary, of course, to the view of UK Prime Minister, Tony Blair, who stated recently: “Apart from a diminishing handful of sceptics, there is a virtual worldwide scientific consensus on the scope of the problem.” This seems to demonstrate to me that the leader of the National Party is completely out of step with scientific thinking around the world on this issue, and if he is so unsure about an issue of such significance to humanity, how on earth can he aspire to run this country as the Prime Minister of it? [Interruption]
Madam SPEAKER: The last bit of the Minister’s answer was out of order.
Rt Hon Winston Peters: I raise a point of order, Madam Speaker. You just heard that response to the Minister’s answer, which was a barracking from the National Party—again—and I ask you to contrast that with the cross benches of the House here, where in the main people behave themselves and listen to the answers. I do not see why one section of this House can carry on like this, day in and day out. One would not mind if it were one or two interjections, but there are about seven or eight interjections at a time. Now that is—
Hon Dr Nick Smith: But the Minister was out of order.
Rt Hon Winston Peters: There he goes again—“Young Nick”.
Hon Dr Nick Smith: Speaking to the point of order, Madam Speaker—
Rt Hon Winston Peters: I was speaking to a point of order—sit down!
Madam SPEAKER: Please sit down. The member is speaking to the point of order. I would also put members on their last warning about interjecting at times when people are asking questions or making points of order. I ask that member for the last time to respect the rules of this House. Would the member now please come to the conclusion of his point of order.
Rt Hon Winston Peters: But that is my point. The fact of the matter is there is a barrage going on over there and we can barely hear the answers.
Hon Dr Nick Smith: The very ruling you gave today, Madam Speaker, which I have in front of me, makes it absolutely plain that the Minister’s response was out of order. It was not out of order for just one sentence, but it was for three or four sentences, and you chose to do nothing. So the Opposition had no choice other than to barrack at that sort of response. Equally, every single day, we have Winston Peters making irrelevant points of order—they are just cheap political pot-shots—and, again, we are given no choice but to respond. All it requires, Madam Speaker, is for you to enforce the very ruling that you have given today.
Hon Dr Michael Cullen: Even if there was any virtue in that point of order, if members feel that a Minister is in breach, then of course they raise a point of order. They do not all start yelling together, and that is the point made by Mr Peters. It is that the National Party continually just barracks and barracks and barracks.
Madam SPEAKER: I did agree, but the point was that the barracking was such that it is very difficult to hear. When I did hear that the answer was not consistent with the question asked, I intervened. The member probably did not hear the answer because of the barracking. The rules are that if members do not agree, they should raise a point of order. Then there will be silence and we can hear the answers. I ask members to please keep the level of noise down. We will now proceed with question time.
Hon Dr Nick Smith: Does the Minister believe that the paltry sum of $3.6 million a year spent on agricultural animal emissions is sufficient, given the scale of the climate change problem, the fact that 49 percent of emissions come from agriculture, the fact that New Zealand has significant research expertise in the area of animal husbandry, and the fact that the Government has had to decline a significant number of research projects because of the inadequate budget?
Hon JIM ANDERTON: It almost certainly is not enough, and the Government is looking at that this year. But I have to say that it is a lot more than would probably come from a party led by somebody who denies that climate change is a problem at all.
Hon Dr Nick Smith: Was that in order?
Madam SPEAKER: Yes, it was in order, Dr Smith. The Minister addressed the question. He said there was not enough.
Hon Dr Nick Smith: I raise a point of order, Madam Speaker. The first part of the Minister’s answer, in which he responded to my question, was perfectly in order. But can you please explain to the House how the cheap shot at the Leader of the Opposition, Don Brash, in any way complied with your ruling.
Hon Dr Michael Cullen: It used to be the case that this was a robust Chamber in terms of debate and exchanges, and people were not quite so precious about certain matters. I have listened to question after question today, which are questions about certain matters around integrity and various other aspects of various Ministers. That is the nature of Parliament. The fact is that the Leader of the Opposition has tried to deny that climate change exists, and that is a robust response from the Minister in terms of the question asked by the member. The Minister said that the problem was such a serious one that we should spend a lot more money on it.
Hon Dr Nick Smith: Are you going to give your ruling?
Madam SPEAKER: Yes. The answer was perfectly in order. That was my ruling.
Hon Mark Burton: I raise a point of order, Madam Speaker. I apologise for there being another point of order, but I am increasingly concerned about the behaviour of the member opposite, which is something I would like you to consider. He raises points of order, but then directly challenges you in the Chair, not by way of a point of order but by yelling at you from his seat and trying to intimidate the Chair. It is absolutely inappropriate behaviour, and I ask you to give some consideration to it, because challenging the authority of the Chair is not a practice we would want a whole lot of members to engage in.
Madam SPEAKER: I have ruled on the matter. I just ask the House to settle so we can proceed.
Metiria Turei: Is the Minister aware that the cost of buying credits to cover just the current agricultural emissions is about $400 million a year, and does he not think it would be much more cost effective both for the farmers and for the country if farmers are incentivised to reduce their greenhouse gas emissions now—for example, through the production of biogas from farm wastes, planting of forests, better fertiliser management, and the development of alternative seeds, as set out in the Greens’ paper Turn Down the Heat?
Hon JIM ANDERTON: I think the member makes a number of fair points. I have looked at the policy paper of the Greens and congratulate them on being one of the parties outside of the Government parties that have put forward constructive ideas. The Government is considering these matters as it reviews its climate change policy.
Metiria Turei: What proposals does the Minister have to ensure that farmers are developing land and, particularly, water-use systems that are ecologically and economically sustainable, given the report of the National Institute of Water and Atmospheric Research predicting that due to climate change eastern New Zealand will become markedly drier and when 58 percent of New Zealand’s farm area is on the east coast?
Hon JIM ANDERTON: These and a number of other issues like nitrification and the difficulties of quality and access to and supply of water are all on the Government’s programme in terms of the review of the climate change problem, and policy initiatives will be announced as the year goes on. I am expecting this review to be completed by the middle of the year.
Metiria Turei: Does the Minister agree with the Green Party’s Turn Down the Heat proposal to cap agricultural greenhouse emissions, and, moreover, does he not think that New Zealanders would be very shocked that New Zealand will have to buy credits from countries overseas because we simply failed to properly invest in Kiwi solutions today?
Hon JIM ANDERTON: As I said, I have looked carefully at the Green Party’s proposals and there are a number of them. I do not agree with them all, but a number are worthwhile. Can I just say that it would be entirely unattractive to the Government, and to the Minister of Finance in particular, not to take initiatives inside New Zealand and invest in our own development in terms of climate change, rather than handing money to anyone offshore.
Question No. 3 to Minister
JOHN KEY (National—Helensville): I seek leave to table a document from the Government’s website—and I apologise—in relation to question No. 3. I also apologise to the Minister of Finance. He is, of course, correct. It is possible to have a payment under Working for Families if one has 20 children. That payment would apply if one earned up to $385,000 a year, and I apologise for my oversight.
Madam SPEAKER: That is not a point of order. May I say that it is comments like that that lead to disorder in the House. Just remember the next time the complaint comes as to why this happens. But I will ask the House. Leave has been sought to table that document. Is there any objection? There is objection.
State Houses—Household Incomes
5. PHIL HEATLEY (National—Whangarei) to the Minister of Housing: Is the North Island State household with the highest total net assessable income earning $1,825.73 a week and the South Island State household with the highest total net assessable income earning $1,391.80 a week as at 23 March 2006; if not, what are the highest incomes?
Hon STEVE MAHAREY (Minister of Education) on behalf of the Minister of Housing: Yes, I can confirm that those are the highest net assessable incomes, and that those tenants were housed before the introduction of the social allocation system for State housing by the Labour-led Government in 2000.
Phil Heatley: How can the Minister let people who earn $70,000, $80,000, and $90,000 a year after tax stay in a State home when 14,000 people are on the waiting list, poor people are on the streets, and struggling young families are living in garages?
Hon STEVE MAHAREY: I have to point out to the member that the high-income tenants living in State houses are a legacy of National’s failed market rent system. Those people have signed a tenancy agreement and they have rights. However, we are actively managing those tenants to encourage them to either buy a house or move into the private rental market. I tell that member that it is a little rich for National to have sold 13,000 houses and then for him to come in here and complain about a waiting list.
Georgina Beyer: What proportion of new Housing New Zealand Corporation tenants qualify for an income-related rent?
Hon STEVE MAHAREY: The Labour-led Government scrapped National’s market rents in 2000, and introduced a new social allocation system that prioritises those on low incomes with the greatest housing need. Prior to that, one could have got the $300,000 annual income that Mr Key was talking about and got into one of those houses under National. Ninety-nine percent of new tenants housed last month, who qualified for an income-related rent, had an average net assessable income of $261.55 per week.
Judy Turner: Has the Department of Building and Housing, in monitoring rates of income for State housing tenants, determined at which point it would be ideal to approach a tenant with an offer for the tenant to purchase the property; if so, what is that income rate, and if the department has not made that calculation, why not?
Hon STEVE MAHAREY: We would not be approaching the person to purchase a State house. We still have to get back the 13,000 houses that we lost under the National Government. However the trigger for talking to people about moving into an alternative private sector rental property or buying a house comes as they approach a market rent.
Phil Heatley: How fair is it that a Christchurch household can have a $70,000 income, but not include the income of an adult son who is a chef, and does not include the income of another adult son who works in telecommunications and also lives at home, yet all the while poorer families go without housing?
Hon STEVE MAHAREY: I reiterate to the member opposite that Labour’s track record over 6 years of housing people who were left in need by National’s policy is simply and utterly outstanding. If the member has a particular complaint about a particular house, he should give it to me and I will have a look.
Georgina Beyer: What is the Government planning to do to make sure people earning nearly $100,000 per annum are not occupying State houses?
Hon STEVE MAHAREY: The Government has been, of course, extremely active in that area, unlike the previous National Government. For example, the mortgage insurance scheme was designed to get people into houses, and we prioritise people in State houses. The KiwiSaver scheme is designed to get people into houses. The new share equity scheme is designed to get people into houses. We are very active, because we believe that people should be in their own houses—preferably owning them—unlike the National Party.
Phil Heatley: Does the Minister think it is fair that a Christchurch family on a $70,000-plus income, with its two adult sons, remains in a State house so that—and this is the tenants’ quote—“the boys can save some money for overseas travel”, and “they can pay off loans for some vehicles”, while poor families go without housing?
Hon STEVE MAHAREY: I would point out that those people pay a market rent, I would point out that we will be encouraging them to take up options like purchase or a shift into the private market, and I would point out that under the National Government it was the policy of that party to put as many high-income people into those houses as it possibly could, and when it sold them it sold them to speculators. It is unreal that this member is raising these questions.
Phil Heatley: Where is the Minister’s compassion and good sense of what is fair when a family can earn over $70,000 after tax, not declare its adult sons’ incomes, and save for overseas travel, yet all the while thousands of needy families are languishing on the waiting list?
Hon STEVE MAHAREY: I repeat that 99 percent of people who got a house in the last month were income-related tenants. Under that member’s National Government people routinely had high incomes and got rental properties, and speculators bought a large proportion of those 13,000 houses—which we could use right now.
Rt Hon Winston Peters: I raise a point of order, Madam Speaker. This is getting to a stage where the treatment of various members of this House is different. The simple fact is that I counted 10 people over on the Opposition benches shouting during that last answer and the answer before that. The fact is that if we are required to keep quiet while questions are being asked, there should be a modicum of silence when questions are being answered. I do not mind there being one or two interjectors, but it makes a leaderless rabble to have 10 people interjecting—not the social welfare spokesperson but everybody. That is what is happening over there. I think it is patently unfair, and I say they should be stopped.
Madam SPEAKER: I thank the member. I ask members please to keep the barracking at acceptable levels so all members in the House can hear. That is the right of members.
Phil Heatley: I seek leave to table a Press article about a four-income family saving for overseas holidays.
Madam SPEAKER: Leave is sought to table that article. Is there any objection? Yes, there is objection.
Phil Heatley: I seek leave to table a valuation report documenting that that household has a Housing New Zealand ownership in a Housing New Zealand – owned home.
Madam SPEAKER: Leave is sought to table that document. Is there any objection? There is objection.
Teenage Crime—Principal Youth Court Judge's Comments
6. RON MARK (NZ First) to the Minister of Justice: Has he read the reported comments of Principal Youth Court Judge, Andrew Becroft, that there has been a surge in the most serious violent crime being committed by teenagers; if so, does he share this view?
Hon MARK BURTON (Minister of Justice): I have seen the comments of Judge Becroft in an article that he wrote for the Justices Quarterly, in which he notes that the crime levels for this age group have stabilised over the last 5 to 8 years. He also notes that although serious offending grabs the headlines, it accounts for only a small percentage of the total number of offences. I think what the judge has rightly commented on is that in some cases the level of violence has escalated and he rightly—and I think as all members in this House would agree—draws attention to our concern about that.
Ron Mark: Would he agree that effective deterrents are a key part of the youth justice system, and that the sharp jump in serious violent offences committed by youths may indicate that there is currently a lack of effective deterrents; if not, why not?
Hon MARK BURTON: Again I think there is some confusion about what Judge Becroft was actually saying, but there is no doubt at all about the concern that he has rightly expressed—as I indicated in my first answer—to the seriousness of some of the violence. There is equally no question that we have to continue to look at the effectiveness of interventions. I have to say, however, there have been, and will continue to be, a range of programmes—such as Te Hurihanga, which is about to be built in Hamilton—which are about looking at how we address concerns around youth offending generally.
Nicky Wagner: Has he read the reported comments of Judge Becroft that responsibility for young offenders should be removed from Child, Youth and Family Services because it cannot do the job, and that when Cabinet papers reveal that a review of Child, Youth and Family Services youth justice services capability is 9 months behind schedule despite the high degree of concern from the judiciary, and what is he doing to show some leadership in youth justice.
Gerry Brownlee: Does the Minister want to talk about the Commonwealth Games? [Interruption]
Madam SPEAKER: Would members please settle. Each one has had a go, so we will have an answer to the question that has been asked.
Hon MARK BURTON: I would have thought that the member opposite would want to treat this a little more seriously than he obviously does. I am not sure what particular document the member is referring to, and perhaps she will supply it to me afterwards and I could then confirm whether I have seen it before.
Hon Trevor Mallard: I raise a point of order, Madam Speaker. The member opposite, who is not known for his athletic prowess, has just described me as a girl. It is not a terrible insult, but it is not, I think, an appropriate interjection to make during question time.
Gerry Brownlee: I most certainly did not refer to the Minister as being a girl. That is not an insult I would ever offer—it is just totally inappropriate. But I did call him a goon, and I think that name fits really well. I now seek leave for the Minister for Sport and Recreation to be given a couple of minutes to offer his congratulations to the Commonwealth Games athletes, noting that he was at an extended luncheon function earlier and was unable to participate in that debate earlier today.
Madam SPEAKER: No, I am sorry; the member cannot seek leave on behalf of another member.
Hon Trevor Mallard: I spent an hour and a half yesterday congratulating the athletes directly.
Madam SPEAKER: Well, I am not sure exactly what the points of order were about, but we will now hear the answer.
Hon MARK BURTON: To complete my answer to the member, I say that the Government has initiated a wide range of interventions, ranging from those that I think the member might agree are particularly important, such as early intervention, which is part of a long-term strategy to make a difference to crime reduction. There is everything from increased participation by Māori and Pacific children in early childhood education, through to an extensive youth-offending strategy that includes, for instance, the creation of 30 youth-offending teams around the country, further training for police and Child Youth and Family Services, the introduction of health and education assessments for many young offenders, and so on. There is a great deal of work going on, but there is a great deal more to do.
Dr Pita Sharples: Has the Minister read the recent comments of the same Principal Youth Court Judge, Judge Andrew Becroft, that “youth crime is not skyrocketing”, and that whatever we need to do to avoid imprisonment, we must take up, because when a person is sent to prison “it is likely the person will come out a more serious offender”, and does the Minister share this view?
Hon MARK BURTON: Again, I am not sure whether I have seen the particular article the member refers to, but certainly the content of it is consistent with articles such as the one in the quarterly that I have referred to previously. Certainly, the judge does refer there to the relatively stable level of youth offending over the last 5 to 8 years. But I think, like virtually every judge I have ever spoken to—and I can say that there are a great many—tends to agree, prison is seldom the best strategy for reducing long-term offending.
Ron Mark: Will the Government be supporting the referral of my Young Offenders (Serious Crimes) Bill to a select committee to enable the public to have their views heard on the youth justice system and on the tools available to police and the courts to deter young offenders from entering a life of crime and subsequently ending up in our jails, which, as the member has just pointed out, we possibly should not have because they do not work? [Interruption]
Madam SPEAKER: And which the member should not have pointed out while the question was being asked.
Hon MARK BURTON: Yes, indeed. The Government will be supporting the member’s bill, because I think it does offer an opportunity for consideration of some very serious issues, and I think the quality of the questions members have asked in the House this afternoon demonstrates that these are serious issues. They require serious consideration. I think this Parliament will benefit from the value contributed to the process by wide public involvement.
Question No. 3 to Minister
Hon Dr MICHAEL CULLEN (Minister of Finance): I raise a point of order, Madam Speaker. In light of a claim earlier that I had made up a costing of $11 billion over 3 years for National’s tax cuts. I seek leave to table the Newstalk ZB transcript from 9 February 2006, where Mr Key says: “I mean, it was $11 billion worth of tax cuts over 3 years.”
Document, by leave, laid on the Table of the House.
Focus 2000 Ltd—Complaints
7. Dr PAUL HUTCHISON (National—Port Waikato) to the Minister of Health: What action did Ministers take when they were first made aware of complaints surrounding Focus 2000 in 2002?
Hon PETE HODGSON (Minister of Health): As a matter of course, when Ministers receive complaints about service providers the complaints are passed to the Minister or to the Ministry of Health.
Dr Paul Hutchison: Why has he failed to prevent the ongoing incidents of abuse, maltreatment, and neglect that continue to occur under State disability providers, given that the reported 2002 incidents were so serious they included “two deaths in the last 3 years, no staff present, both choked to death.”? Why has he failed?
Hon PETE HODGSON: The member is clearly referring to Focus 2000, which has been subject to a large number of audits, the repayment of $2.5 million, and a significant change in the way it does things. That has, however, not stopped the complaints. A further series of audits is under way now, and the ministry is meeting with Focus 2000 management on a weekly basis.
Dr Paul Hutchison: What has he done, other than to order more audits, to prevent incidents under State-contracted disability providers such as the recent report of “an intellectually disabled autistic man who was kicked and later dragged naked around a rugby field”?
Hon PETE HODGSON: I have received a number of complaints—certainly in excess of the number that has been alluded to in the House today—that have caused me to ask the Ministry of Health to undertake a number of audits. Those audits include, first of all, an organisational audit—
Hon Members: More audits and reviews!
Hon PETE HODGSON: I can tell members if they like, or I can sit down if they do not like—it is their choice. Those audits include an organisational audit, which is an unusual audit for the Ministry of Health to undertake and reflects concerns about governance, as well as a financial audit, which reflects concerns about money. As well as those, there will be a number of quality audits, which were scheduled anyway, which reflect ongoing concerns about the provision of care. It is a matter of fact that I have also received a large number of pieces of advice saying that people are very happy with Focus 2000. There is a variety of views on the matter.
Dr Paul Hutchison: What will the Minister do, other than order more audits, to stop the ongoing abuse and neglect under State-contracted providers, when only this month a further complaint was made that the same blind, intellectually disabled, autistic man is being regularly punished by way of forced cold showers whenever he smears himself with faeces?
Hon PETE HODGSON: If the member has any complaint that he wishes to make available to me, I warmly invite him to do so, and I would like him to do so as freely and as often as he wishes. Finally, if the Ministry of Health—and specifically the Director-General of Health—holds the view that any residential facility ought not to continue, then she is entitled to issue a cease and desist order. That happens from time to time. It has happened, in recent times, other than to Focus 2000, and the member may be aware of that already.
Dr Paul Hutchison: Does the Minister accept that he was ill-informed and confused on 17 February this year, when he was asked by Radio New Zealand about the need for wholesale change or for a special inquiry into Focus 2000 and he said: “No, no, no, no. No, not at all.”, and will he now commit to a full-scale inquiry into shortcomings of care within the disability sector?
Hon PETE HODGSON: It is interesting that the member asks me to commit to a full-scale inquiry, when, on the afternoon of that very day, that is exactly what happened.
Dr Paul Hutchison: I seek leave to table three documents. The first article is from the Weekend Herald dated Saturday, 18 March 2005 and is entitled “Disability care in crisis”.
Madam SPEAKER: Leave is sought to table that document. Is there any objection? There is.
Dr Paul Hutchison: The second article is from the Herald on Sunday dated 5 June 2005 and is entitled “Disabled patient ‘dragged naked around a field’ ”.
Madam SPEAKER: Leave is sought to table that document. Is there any objection? There is.
Dr Paul Hutchison: The third article is from the Herald on Sunday dated 12 February 2006 and is entitled “Disabled ‘roughly handled’ by staff”.
Madam SPEAKER: Leave is sought to table that document. Is there any objection? There is.
Auckland Transport Infrastructure—Rugby World Cup
8. Hon MAURICE WILLIAMSON (National—Pakuranga) to the Acting Minister of Transport: Is he concerned that the Auckland transport infrastructure will not cope with the demands put on it by the Rugby World Cup in 2011; if so, what special initiatives does he plan to implement?
Hon PETE HODGSON (Acting Minister of Transport): No, I am not concerned, because the Government is investing heavily in Auckland’s transport system, and by one measure at a rate 10 times faster than when the member himself was the Minister of Transport.
Hon Maurice Williamson: Is the Minister aware that if we can return to the optimistic August update, which included the $500 million upgrade—a point we are still not at—that will mean that in Auckland, during 2011, the Manukau Harbour Bridge extension project will be halfway through, the Avondale extension of State Highway 20 will have just started, the Auckland Harbour Bridge to city completion project will be about one-third of the way through, and we will be around halfway through the upgrading of the Newmarket viaduct, and does the member from Dunedin have any idea what that will mean for Auckland motorists in 2011?
Hon PETE HODGSON: I am sure that Transit, working with other organisations in Auckland, will manage issues around construction zones, as it did, for example, during other big events in Auckland such as the Lions tour and for the occasional visit and large conference, and so on. The point of the story is that we will have to stop work on very, very many projects, because we will have work under way on so many, many projects.
Hon Maurice Williamson: Has the Minister read the Treasury briefing note to the Minister of Finance dated 28 June 2005, which states “A recent internal Treasury project examines the question of whether, from a national welfare perspective, expenditure on roads is sufficient.”, and concludes by stating that although Transfund is using a cost-benefit analysis, and that it may be sound, it suggests that substantial road infrastructure under-investment is occurring and that New Zealand seems to be passing up road investments that would earn a very high return, and is he concerned that that is Treasury’s view of this Government’s level of investment?
Hon PETE HODGSON: Since the date of the Treasury paper to which the member refers, the Government has increased investment. I urge the Opposition to try even harder to keep abreast of this fast-moving Government.
Taito Phillip Field: Can the Minister inform the House as to what key projects will be completed before the Rugby World Cup gets under way in 2011?
Hon PETE HODGSON: If I restrict myself to the major ones, I am sure I will get through the list before being sat down. It includes State Highway 18 Greenhithe deviation, State Highway 18 Upper Harbour Bridge duplication, State Highway 20 Mount Roskill extension, State Highway 1 northern busway, State Highway 1 all phases central motorway junction upgrade, continued double tracking of the western line, continued upgrade of a number of stations, a number of auxiliary lanes on a number of highways, and on and on it goes.
Rt Hon Winston Peters: Has the Minister received any reports as to how far ahead in our state of infrastructural roading preparedness we would have been had Mr Williamson, as Minister of Transport, not opposed a 1995 bill to divert money from roading taxes towards roading, or, in 1999, not supported the repeal of the prior year’s budgetary provision to put more money into roading; how far further down the track would we have been without those actions from the previous National Government?
Hon PETE HODGSON: I have no reports on the specific matter the member raises but I do know that the quantum of money is sufficient that the distance would have been very substantial indeed.
Heather Roy: Is progress on State Highway 20 through Auckland painfully slow because, while overgrown construction in the Mount Roskill electorate is fine with the Prime Minister, she demands that a billion-dollar tunnel be built to accommodate the highway through her electorate?
Hon PETE HODGSON: No—and what is more, the Mount Roskill extension, which is the bit that is being built now, is a little ahead of schedule.
Hon Maurice Williamson: Why does the Minister continue to repeat the incorrect mantra that the Government is spending 10 times as much as the previous National Government on Auckland’s roads when in fact his own numbers, given by way of written answer, which he will be able to check, show that in the last year of the previous National Government $134 million was being spent on new roading in Auckland, and that that figure dropped—as the graph I have will show the Minister—under the first few years of the Labour Government and has got back to around the $200-million mark only now, which is nowhere near 10 times, and in fact after correcting for inflation has hardly increased at all?
Hon PETE HODGSON: The member deludes himself. The criterion I referred to when I cited one measure in my answer to the primary question is simply a measure of all major projects. We are not talking about puddles and footpaths; we are talking about major projects. Spending on all major projects under way or recently completed is now worth $1.3 billion, and when we came to Government the figure was 10 percent of that. That is the fact of the matter, and the member has to wear it because his Government was hopeless.
Hon Maurice Williamson: Has the Minister seen the statement by the chair of the Auckland Regional Council, Mike Lee, when asked whether he thought Auckland’s transport infrastructure would cope with the Rugby World Cup: “I can say it will, but it will barely cope, and the point is we need to do better than that. We really need to be striving for excellence rather than putting up with the mediocre.”; if so, what will the Minister do to address the enormous shortfall in funding for Auckland’s infrastructure over the next 5 years before the Rugby World Cup takes place?
Hon PETE HODGSON: Chairman Lee would reply, if asked, that this Government is the best Government of recent times and a whole bunch better than the Government we replaced. He went on to say in his press statement of 28 March, yesterday, that the Auckland Regional Council is looking at a variety of alternative funding sources to achieve the level of investment necessary for public transport. The Auckland Regional Council is very, very pleased with the Government.
Hon Paul Swain: Could the Minister advise whether transport projects in Auckland would be due for completion by 2011 if the roading network had been privatised, as was promoted by the previous National Government?
Hon PETE HODGSON: The member, a former Minister, raises a very good question. The truth of the matter is that the Government spent much of the 1990s arguing about who in this country should own the roads. Who do members think should own the roads? [Interruption] OK, we should. That is the answer. It did not take a decade; it took a nanosecond. That is the difference between this Government and the previous one, which let ideology overcome common sense.
Peter Brown: Is the Minister aware of the ULTra personal rapid transport system that is being developed in Cardiff and, indeed, in some other cities; if he is aware of it, does he believe that such a system could be installed in Auckland in order to address positively Auckland’s transport woes?
Hon PETE HODGSON: I am afraid I am not, but I hope it does not “leek”.
Border Security—Initiatives
9. Hon MARK GOSCHE (Labour—Maungakiekie) to the Minister of Immigration: What initiatives is the Government taking to strengthen New Zealand’s border security?
Hon DAVID CUNLIFFE (Minister of Immigration): New Zealand has recently signed a memorandum of understanding with the Ambassador of the United States that provides for the sharing of information on border security. The Regional Movement Alert List will enhance New Zealand’s ability to detect lost, stolen, or invalid travel documents that travellers are attempting to use.
Hon Mark Gosche: What evidence does the Minister have that this initiative will benefit New Zealand?
Hon DAVID CUNLIFFE: Since 2003 New Zealand and Australia have had a similar arrangement to the Regional Movement Alert List. In 2004-05, 660 people were prevented from boarding flights to New Zealand who had either security alerts against them or travel documents that were invalid or stolen.
Peter Brown: Is the Minister aware that Britain has signed a memorandum of understanding with Jordan and Libya and is working on signing one with Algeria; if the Minister is aware of that, will he recommend that the Prime Minister talk to Tony Blair whilst he is in this country to ask how it is done so that we can send Mr Zaoui packing at the earliest possible moment?
Hon DAVID CUNLIFFE: Yes and no.
Question time interrupted.
Personal Explanations
Legal Aid—Refutation of Allegation
Rt Hon WINSTON PETERS (Leader—NZ First): I had hoped to wait until the end of question time, but because of the time questions are taking I seek leave now to make a personal explanation about a matter David Bennett raised in the House on 22 March. I have just had my first chance to read the Hansard of his speech. On 22 March David Bennett, the National Party MP for Hamilton East, claimed that during the wine-box inquiry I personally received money from legal aid paid for by the taxpayer. That statement is demonstrably, totally false, as every member of the National Party who was there at the time knows full well. On the contrary, I myself financed substantial parts of that court case and cases preliminary to it. The member also knows that. I seek to put that correction on the record, in case some other idiot decides to make that sort of statement in the House.
Hon BILL ENGLISH (National—Clutha-Southland): I raise a point of order, Madam Speaker. The personal explanation is a privilege made available to members of Parliament that we use only occasionally, and it is a privilege given by leave. That leave is given because of the convention that such statements are non-controversial, in the sense that they are not partisan or do not attack members of the House. The member who just made a personal explanation is a senior member of the House and knows that convention well. I ask you to point out that the last sentence of his statement was out of order. If you do not do so, then the Opposition, at least, will not be able to give leave for personal explanations, if the privilege is to be abused in that manner.
Rt Hon WINSTON PETERS (Leader—NZ First): With respect, the National Party knows full well the history of that long-running saga—that it took 7 years and a significant number of court cases going all the way to the Privy Council. For that member to be allowed to get away with saying what he did with not so much as a by your leave or an apology would be an absolute affront to the House. That is why I said what I said.
Madam SPEAKER: The member was entitled to make his personal explanation, and the Hon Bill English was correct in saying that a personal explanation is a privilege of the House, given by leave. But it is, of course, the convention that members do not make personal attacks or reflections in such statements, and the term “idiot” was entirely unacceptable.
RON MARK (NZ First): I raise a point of order, Madam Speaker. On the back of the point of order raised by Mr English, could you then advise the House whether, if this is considered by some to be an inappropriate means of putting the record straight when another member of the House has deliberately said something to the House that is clearly untrue, I would be right in concluding that the only other method of recourse we would have for correcting this is to lodge a privileges case against the member for deliberately and maliciously misleading the House. Is that the other course of action we could take?
Madam SPEAKER: The member took the proper course of action in seeking the leave of the House to make a personal statement to be able to correct the statement. There was nothing wrong with that. The problem was the use of language in the last sentence; that was the difficulty we had with that bit of the personal statement. The rest of it was perfectly in order.
RON MARK (NZ First): I raise a point of order, Madam Speaker. Just for clarification, would it have been permissible for New Zealand First, instead of taking this course, to take a more extreme course and lodge a privileges case?
Madam SPEAKER: You know that it is not for the Speaker to give advisory opinions like that. I have ruled on what was the appropriate action and what was not appropriate. That is what I have ruled on.
GERRY BROWNLEE (Deputy Leader—National): I raise a point of order, Madam Speaker. Should the Rt Hon Winston Peters now be required to withdraw and apologise?
Madam SPEAKER: If that is what the member seeks. Does the member who was called an idiot ask for that to be withdrawn? [Interruption] Would members please be quiet, or there will be no one left in the House. I was looking at the member, and I understand that he is new, but he has asked for that statement to be withdrawn and for an apology.
Rt Hon Winston Peters: What did the member say? I could not hear it.
Madam SPEAKER: The member asked for the reference that was made to him by you to be withdrawn and for an apology to be given. That is what is sought.
Rt Hon Winston Peters: I said “some other idiot”, and I withdraw and apologise.
Madam SPEAKER: Thank you, that’s all—
Rt Hon Winston Peters: I have just found out who he is.
Madam SPEAKER: All members do is withdraw and apologise. They make no other statement.
LINDSAY TISCH (Senior Whip—National): I raise a point of order, Madam Speaker. The member just apologised, then qualified that by saying he now knows who the idiot is. That is completely unacceptable.
Madam SPEAKER: It is unacceptable. I agree with Mr Tisch. The rules are that when members are asked for a withdrawal and an apology, they give it without any other statement. The member is coming close to trifling with the House.
Rt Hon WINSTON PETERS (Leader—NZ First): I did not say that the member was an idiot, I said: “in case some other idiot”—that is the point. Members cannot just get up and make any allegation they like. The Hansard—
Madam SPEAKER: I am sorry, would the member—
Rt Hon WINSTON PETERS: I withdraw and apologise if the member is offended.
Madam SPEAKER: Thank you, that is all we need to make progress.
GERRY BROWNLEE (Deputy Leader—National): I raise a point of order, Madam Speaker. I have to register our disappointment that, having picked up Mr Peters for the inappropriate use of language, the allegation made by Mr Peters was then repeated by the Speaker.
Madam SPEAKER: I agree.
GERRY BROWNLEE: I appreciate that the circumstances probably led to that.
Madam SPEAKER: Yes, thank you. I accept that and I apologise.
Rt Hon WINSTON PETERS (Leader—NZ First): I raise a point of order, Madam Speaker. I have put my reputation on the line and made a statement to this House today. The least I could expect is for that member to withdraw and apologise for what he said and to not sit there mute and silent.
Madam SPEAKER: That is not a point of order.
GERRY BROWNLEE (Deputy Leader—National): I seek leave to table a document showing exactly how much the taxpayer did pay for Winston Peters’ legal expenses in the wine-box inquiry.
Madam SPEAKER: Leave is sought to table that document. Is there any objection? There is objection.
Rt Hon WINSTON PETERS (Leader—NZ First): I raise a point of order, Madam Speaker. The member has just repeated the same statement, which if it were said outside of here would be defamatory. He knows full well where the money went. Not one cent went to me.
Gerry Brownlee: I’m not saying that.
Rt Hon WINSTON PETERS: Yes, the member did. He asked how much Winston Peters got.
Madam SPEAKER: Leave was denied. That is the end of the matter, please.
Question time resumed.
Questions for Oral Answer
Questions to Ministers
Treaty of Waitangi—Historical Claims
10. GERRY BROWNLEE (Deputy Leader—National) to the Minister in charge of Treaty of Waitangi Negotiations: How does he define “historical claims” as referred to in the Government’s 2005 election policy?
Hon MARK BURTON (Minister in charge of Treaty of Waitangi Negotiations): Historical claims relate to Crown acts or omissions prior to 21 September 1992. This definition has been consistently applied since its adoption by Cabinet in 1992.
Gerry Brownlee: When does he intend to introduce legislation to the House to give effect to the election promise to close off the lodgment of all historic Treaty of Waitangi claims by 1 September 2008?
Hon MARK BURTON: I can assure the member that the appropriate Minister will put the appropriate legislation before the House to ensure that the legislation is passed in plenty of time to meet that target.
Gerry Brownlee: What discussions has the Minister had with the Hon Nanaia Mahuta over the conflicting claims between Ngāti Te Ata and Tainui over the iron sands at Maioro?
Hon MARK BURTON: Whilst I meet frequently with the Hon Nanaia Mahuta, I have not had any meetings on that subject as such.
Pita Paraone: Does the Minister agree that the key to expeditiously resolving historical claims lies not in adopting a negative approach, unlike some parties in this House, but in adopting constructive ideas such as those contained in the Waka Umanga report, like having iwi groups establish mandated corporate entities at the front end of negotiations rather than during the final stages of negotiations; if not, why not?
Hon MARK BURTON: I entirely agree with the member’s assertion that constructive engagement to find creative ways to reach settlement is indeed the best way forward. Although not every idea that is advanced will necessarily be appropriate, improvements can certainly be made, and I am actively seeking to make them.
Gerry Brownlee: Is it a policy of this Government for the Office of Treaty Settlements to ignore Waitangi Tribunal findings; if not, why has the Office of Treaty Settlements decided to ignore a 1985 Waitangi Tribunal finding that the Crown should negotiate with Ngāti Te Ata over Maioro and decided to deal instead with Tainui?
Hon MARK BURTON: I would have to look at the documentation to see whether the member’s assertion is correct. Certainly, it is not the practice of the Office of Treaty Settlements to ignore the tribunal, but it does not always agree with the tribunal.
Gerry Brownlee: I raise a point of order, Madam Speaker. I ask you to reflect on that answer. He is virtually saying that I am wrong in making that particular assertion. He is the Minister; one would assume that where there is such a difficult conflict, he might have received some report on it. This is an issue that could see New Zealand Steel shut down within a very short time, and I do not believe for one minute that the Minister has not been acquainted with the difficulties that exist over that particular claim.
Hon Trevor Mallard: That may or may not be the case, but I think if one looks carefully at question No. 10, one will see that it is not clear this was a matter that was signalled as part of the original question. Some of the problems we had last week—or possibly the week before; I do not know whether I was here last week—were around these issues of having blind first questions, British House of Commons style. People cannot expect Ministers to bring all the details of every Office of Treaty Settlements case in response to a question like that. If one wanted to go even further, one might want to question whether asking the Minister to define historical claims and then going to a specific claim is within the bounds of the original question, anyway. [Interruption]
Madam SPEAKER: No, I do not need further help; I thank members. The question was a general one. The member is entitled to ask questions within that general context, and did, but the Minister is equally entitled to express a view, which he did. If he felt that the member was wrong, then he is entitled to say that. I ask the member to ask a supplementary question.
Gerry Brownlee: Why is the Office of Treaty Settlements now deciding to deal with Tainui in matters that should rightly be dealt with through Ngāti Te Ata, on the basis that Ngāti Te Ata are hapū of Tainui, when in fact Ngāti Te Ata do not appear as one of the 23 listed hapū in the Tainui settlement legislation?
Hon MARK BURTON: Frankly, my colleague Mr Mallard made the pertinent point. I am simply not prepared to come to the House and debate the detail of—
Hon Dr Nick Smith: You don’t know what’s going on.
Hon MARK BURTON: I say to Mr Smith that the fact that I do know what is going on in the portfolio means I am not prepared to come to the House and discuss the detail of any one of 23 complex negotiations in a superficial way.
Gerry Brownlee: I raise a point of order, Madam Speaker. That cannot be an acceptable answer from the Minister. These questions are set down early in the day. Surely a Minister would go to his office staff and ask what all the interesting, difficult, potentially troublesome settlements or claims around the countryside are that this question might lead on to. Surely, do we not have a right to expect that when the imminent closure of New Zealand Steel is at stake, the Minister may have received a briefing? Further, are we not entitled to imagine that these—
Madam SPEAKER: Could the point of order be brief, please.
Gerry Brownlee: The point of order is that you surely cannot allow Ministers to simply say that they did not anticipate the question, and that they will come back—
Madam SPEAKER: No. I thank the member.
Hon Trevor Mallard: Speaking to the point of order—
Madam SPEAKER: No. I need no assistance with this. I have already ruled, in effect, that of course the Minister did address the question. It is always appropriate for a Minister to ask for notice of specific matters that are raised as a result of a general question. That is perfectly in order as a response.
Hon Nanaia Mahuta: Can the Minister clarify that if there is a dispute within iwi over mandate, there is a process with the Office of Treaty Settlements for working that dispute through?
Hon MARK BURTON: Because the member asks a general question, I say that there is, absolutely, a process. Generally, questions within iwi are best solved within iwi, particularly as they relate to mandating, but often the Office of Treaty Settlements does lend assistance to that process.
Hon Trevor Mallard: Is it the Minister’s practice to work carefully through issues within his portfolio in a timely manner, to comment on them as appropriate when he has focused on them, and not to leave dozens and dozens of boxes of papers in his room, as the Hon Nick Smith did when he stopped being a Minister? [Interruption]
Madam SPEAKER: No. Would the Minister please rephrase that question without including the last phrase that has caused the problem.
Gerry Brownlee: I raise a point of order, Madam Speaker. We have had a number of questions today that have asked for a bit of a narrowing of the way in which questions can be answered. I have been told repeatedly that my questions are too broad in relation to question No. 10 itself. How on earth can a Minister being asked to comment on his style of work in any way relate to question No. 10?
Madam SPEAKER: No. The problem with the question, Mr Brownlee, was that what the member asked was actually too specific and narrow, but your original question was fine. The point is that the Minister has addressed the questions here, we have to make progress, and if I receive any more frivolous points of order, then I will rule that the House is being brought into disrepute. So would the Minister please address the question without the member’s last part—an opinion on that, but without the comparison please.
Hon MARK BURTON: The member is entirely correct. This is a complex portfolio in which mistakes are costly in every sense of the word. We have managed to achieve in a relatively short time, in the term of this Government, six deeds of settlements. Thirteen groups have entered negotiations. We have 25 live negotiations proceeding right now. The portfolio requires extreme care and a degree of caution that is rare even in ministerial portfolios. It would be simply irresponsible to treat those issues flippantly and frivolously in this House.
Youth—Government Initiatives
11. DARREN HUGHES (Labour—Otaki) to the Minister of Youth Affairs: What changes is the Government making to improve the lives of young New Zealanders?
Hon NANAIA MAHUTA (Minister of Youth Affairs): From 1 April—this Saturday—interest-free student loans will be introduced as a core commitment by this Labour-led Government to improve the lives of many young New Zealanders. It is a good story to tell. For example, a graduate with a debt of $15,000 who earns $35,000 a year will save $6,935 and repay his or her loan in 7 years. Without the changes, the student would have taken 10 years to repay $21,935 in accumulated debt. There is a good story to tell to young New Zealanders.
Fungus Invasion, Northland—Biosecurity Plan
12. SHANE ARDERN (National—Taranaki-King Country) to the Minister for Biosecurity: Does Biosecurity New Zealand have a plan in place to combat the recently discovered invasive fungus threatening the Northland horticultural industry?
Hon JIM ANDERTON (Minister for Biosecurity): A new species of fungus called Phytophthora kernoviae has been identified in Northland. Biosecurity New Zealand is currently assessing its options for dealing with this fungus. In keeping with our international obligations, Biosecurity New Zealand has notified our trading partners of this find. However, it is not clear how long the fungus may have been in New Zealand. There are several other species of the fungus that cause leaf loss and wilting in trees. Standard crop protection techniques such as applying fungicide can be used to manage these varieties. It has not yet been determined whether that will also work on this variety of fungus.
Shane Ardern: Does the Minister agree with Biosecurity New Zealand’s proposal for a generic incursion response system, as outlined as being one of the Minister’s priorities in the briefing paper to the incoming Minister?
Hon JIM ANDERTON: That is one proposal from the Biosecurity Ministerial Advisory Committee. I point out to the member that if New Zealand were to try to fund biosecurity systems that would prevent not only hundreds of thousands but millions of possible incursions in New Zealand, there would not be enough wealth generated in the whole GDP to guarantee that. I am advised, just as one example, that there are 30 varieties of this particular kind of fungus, and tens of thousands of varieties of fungus in New Zealand. So which hundreds or thousands of those particular varieties does the member have in mind that we deal with? That is only fungus.
Shane Ardern: Does this mean that the Minister was wrong when in his press statement dated 2 November 2005 he stated: “legally (and logically), you cannot have a pest management strategy before incursions happen—”?
Hon JIM ANDERTON: We have to know what particular incursions we are trying to deal with—or is it the millions that the member evidently knows more about than the scientists who advise us? I can say to the member that I do not think I was wrong about that, but I do know that the member was wrong when he said recently that didymo can be killed but that unfortunately one has to kill a river for a few years to do it, and that surely it would be better to sacrifice one or two rivers than to let it spread through the South Island. This Government is not prepared to sacrifice any rivers. It is not prepared to try to kill something that no one in the world knows anything about. New Zealand is now the leading country on scientific investigation into didymo. I wish that the member would wake up and smell the coffee about biosecurity and get a decent briefing from Biosecurity New Zealand, which I will offer him so he can get up to speed.
Shane Ardern: How does the Minister expect the New Zealand public to have any confidence in him at all, when clearly his own Cabinet colleagues do not, as was evidenced yesterday when he was rolled over the dog-chipping fiasco; and when will he actually take some notice of his own ministry when it advises him to have a generic response capability—as his Act requires him? He is required under the Act to have it, so when will he do that?
Hon JIM ANDERTON: In terms of resources for biosecurity, this Government has more than doubled the financial resource for the baselines of biosecurity and it has had extraordinary success in dealing with incursions. The painted apple moth, the Asian gypsy moth, and the fall web worm moth were all dealt with under this Government’s watch, and that is because we have resourced this department properly, unlike the previous National Government.
Shane Ardern: I seek the leave of the House to table Part 5 of the Biosecurity Act, which clearly states that a Minister has the power, and is required, to set up a—
Madam SPEAKER: Leave is sought to table that document. Is there any objection? There is objection.
Shane Ardern: I seek the leave of the House to table the advisory papers to the incoming Minister, which clearly state that a No. 1 objective of Biosecurity New Zealand in 2005-06 was to put in place a strategic management strategy.
Madam SPEAKER: Leave is sought to table that document. Is there any objection? There is objection.
Shane Ardern: I seek the leave of the House to table a press release from the Minister, dated 2 November 2005, where the Minister says that it would not be sensible and he cannot manage a strategy before an incursion happens.
Madam SPEAKER: Leave is sought to table that document. Is there any objection? There is objection.
Tabling of Documents
Tabling of Documents
Government Motion No. 1—28 March 2006
GORDON COPELAND (United Future): About this time yesterday I sought and received the leave of the House to table a letter to me from the chief executive officer of the Porirua City Council. I have since received from him, by fax, a legal opinion that was referred to in that letter but accidentally not enclosed with it. I now seek the leave of the House to table that document, so that we have a complete set.
Document, by leave, laid on the Table of the House.
Wine-box Inquiry—Legal Fees
Hon TAU HENARE (National): I seek leave of the House to table a report that outlines that $1.4 million was spent by the Government—by the nation—on the Rt Hon Winston Peters’ legal fees in the wine-box case.
Madam SPEAKER: Leave is sought to table that report. Is there any objection? There is objection.
General Debate
General Debate
Hon STEVE MAHAREY (Minister of Education): I move, That the House take note of miscellaneous business. This coming Saturday, 1 April 2006, will be yet another proud, red-letter day for those members of this House who are members of the Labour-Progressive Government. I say to each and every one on the Government side of the House that we came here not for all the trivialities of the last few weeks that have been debated here; we came here to make a difference. And on 1 April 2006 we will make another huge difference to families in this country. Already, because of Working for Families 200,000-plus families in this country have gained more childcare, more family support, and more accommodation support. They live a much better life because of that package. Now, on 1 April 2006, $900 million will be spread across people who need it for housing, to support their children, and to ensure that their children are in quality care while they go to work.
I want to give some examples of the effect of Working for Families. Let us take Sale and Barbara. They have three children, live on Auckland’s North Shore, earn $52,000 a year before tax, and pay a mortgage of $385 a week. On 1 April this year they will get $116 more per week. When the whole programme is rolled out, Sale and Barbara will get $245 per week. Let us take Kathryn, who is a sole parent. On 1 April 2006 she will be better off by $200 a week. There is $60 coming from the new in-work payment. Her take-home wages, by the time all of the package rolls out, will be $634, versus being on a benefit of $434. She will be better off; it pays to go to work. On 1 April 2006, Tania and Andrew in Christchurch, who have two children aged 4 and 11, and who work 60 hours a week and earn $37,000, will get $103 from the in-work payment. When the whole programme is rolled out, that family will be $211 better off every week.
Why do we have the Working for Families programme? Let me skip through the reasons. Firstly, the previous National Government left far too many New Zealanders in poverty. Thirty percent of all New Zealand children lived in poverty after 9 years of a National Government. The Working for Families programme alone will drive that figure down to 14 percent. Poverty, lack of security, and lack of opportunity—that was the legacy of that National Government. Why? Because National trapped too many people in welfare. Far too many people were dependent on welfare—415,000 New Zealanders were dependent on welfare when National had finished with them. We have already driven down that number to 289,000.
Secondly, we have driven unemployment down from 160,000 to 48,000, because we want people to have a chance. We are giving them an in-work payment now. We are making work pay. We are giving real opportunity and real security.
Thirdly, Labour supports families. The National Party thinks children are an individual lifestyle choice, and parents should pay for them themselves. We believe that children are a shared responsibility. That is why there are public schools; National wants to privatise schools. That is why there is public health; National wants to privatise it. That is why we have family support; National would not give it to families. That is why we support new parents; National would not do that.
The fourth reason is that under National the cost of housing became the single biggest contributor to poverty in this country. The cost of housing was the single biggest contributor to poverty. We have built State houses. We have had to replace 13,000 of those lost under National, and we pay an accommodation supplement for those living in private houses around this country.
We have introduced the Working for Families package because we are here to assist hard-working New Zealand families. For decades they were told they would get nothing. The rich got richer, and they got poorer. On 1 April they will get their fair share.
KEITH LOCKE (Green): I want to talk today about the Iraq war. There has been an odd silence on this issue, particularly given its great importance not only for Iraqis, who are being killed and tortured in large numbers and having their homes destroyed, but also for the world, if we want peace and adherence to international law.
Daily media attention is given to the killings, the torture, and the mayhem in Iraq. But, unfortunately, there is now silence from our Government as Tony Blair visits this country. I think these last couple of days were a golden opportunity for Helen Clark to say a few home truths to the British Prime Minister. If we are true friends of Britain, as the Green Party is—as our Government is, I hope—then we should be able not only to talk about trade but to talk about important issues like the Iraq war, about which we strongly disagree. In doing so, we will be strengthening relations with Britain, because the overwhelming majority of British people did not want this war, still oppose this war, and want the British troops to be brought home. Tony Blair is standing out against the popular will in Britain, as George Bush is standing out against the popular will of the American people.
The war is clearly wrong, and I want to indicate some of the lessons that could be taught to Tony Blair by our Prime Minister. I tried to convey these lessons to Tony Blair yesterday. I passed him an open letter that was signed not only by myself but by Marion Hancock, Director of the Foundation for Peace Studies Aotearoa / New Zealand; Laila Harré, National Secretary of the National Distribution Union; Edwina Hughes, Coordinator of Peace Movement Aotearoa; and the President and the Vice-president of the Women’s International League for Peace and Freedom, Joan Macdonald and Megan Hutchings. In the letter we explained why it was important that the British Government withdraw its troops from Iraq.
I will go over some of the lessons that our Prime Minister should be conveying to Tony Blair on this day. The first lesson is that politicians should tell the truth and not pretend there are weapons of mass destruction in a place like Iraq when they know there are not. It is interesting that this week a leaked memo was published in the New York Times that described a meeting between Tony Blair and George Bush on 31 January 2003—prior to the invasion—where they agreed that the war would proceed whether or not weapons of mass destruction were in Iraq. George Bush told Tony Blair that perhaps they should provoke a war. One of his suggestions in this official memo was to paint a US surveillance plane in UN colours, and to provoke an attack so that the war could start.
The second lesson is that we should not violate international law. Elizabeth Wilmshurst, who was the Foreign and Commonwealth Office’s Deputy Legal Adviser, advised prior to the invasion that the unlawful use of military force on such a scale amounted to a crime of aggression. Yet the British Government and Tony Blair took no notice.
The third lesson is that although nobody—particularly the Iraqi people—has any love for the deposed dictator, Saddam Hussein, no country likes to be subjected to a military occupation, particularly a prolonged one. The fourth lesson is that when outside nations impose their will on another country, it disrupts the process of nation-building. The memo that was in the New York Times stated Tony Blair and George Bush thought that if the invasion took place in Iraq, it was “unlikely there would be internecine warfare between the different religious and ethnic groups.”—and we all know how wrong that statement is.
The fifth lesson that could be conveyed to Tony Blair is that the British and American forces cannot win. Their presence in Iraq only makes things worse, and we saw even in this morning’s New Zealand Herald how more and more of the country is going out of those forces’ control. The headline of the article in the New Zealand Herald states: “British soldiers sidelined as Basra crime gangs tighten grip on police force”, and that is what happens when there is an occupation force. It produces only mayhem.
The sixth lesson is that the violation of human rights by occupation forces is unacceptable. Violations by British troops have taken place, and there have been numerous instances of that happening. Ben Griffin, a member of the British SAS, recently departed the force for that reason.
JOHN KEY (National—Helensville): We all learn something new every day. I came down to the House today and learnt something very, very special indeed. I learnt that a New Zealand family earning $385,000 a year is still considered needy by the Labour Government. Labour considers a family earning $385,000 to be in need of a tax cut.
I am proud to be part of a National Party that campaigned, and campaigned hard, for the right of all New Zealanders, from all walks of life, to pay less tax and to keep more of what they earn. I am proud to be part of that party, and I am proud to be in one of the parties that form the majority in this Parliament—one of the parties that voted for tax cuts. We are not in the minority, like Labour, which promised tax cuts to a chosen few who were selected in a last-minute electoral bribe before Labour went down the electoral gurgler. We did not promise one or two selected groups of people tax cuts as Labour did in a gasp of desperation before the Government was taken out. We did not select a group of people as Labour did because Labour had made such a hash of the Budget and had to make up for it. I am proud to be part of the National Party, which campaigned for all New Zealanders to have a tax cut.
I feel very sorry for those many New Zealanders who, on 1 April, will look across and miss out, even though they earn so much less than some of the people earning as much as $385,000 a year who will receive something. That package, Working for Families, should rightfully be named “Welfare for Families”. It is a policy based on a very simple principle—those who, in many cases, can afford to give the least are being asked to give money to those who very often need it the least. No one in this Parliament can argue that someone earning $385,000 a year deserves to take the taxes of a young person earning $25,000 a year. That is simply not right, and it robs New Zealanders of a rightful and logical system. It also robs New Zealanders of their dignity.
Overwhelmingly, New Zealanders have responded in surveys to the fact that they want to keep more of what they earn. They do not want to become beneficiaries of the State, and they do not want to risk being in debt to the State. They do not want to have to estimate their income and potentially become a debtor of the Inland Revenue Department. New Zealanders have asked for a simple thing: just to have left in their pockets more of what they work so hard for every day. What is wrong with that? What is wrong with people having the ambition and the goal of wanting to make the most of their lives? What is wrong with people believing that the skills they have, the overtime they work, the training they go through, or their acceptance of more responsibilities in their jobs will lead to them having more in their pockets rather than being the pawns of Michael Cullen and Helen Clark who may or may not feel desperate enough to give them something on election day and that is it?
Michael Joseph Savage would be turning in his grave if he believed that his treasured welfare State—
Jill Pettis: He believed in families.
JOHN KEY: That is right, the Labour members do not like it. But he would be turning in his grave if he saw welfare extended to a family living in an $800,000 house in the wealthiest suburb in New Zealand, where mum and dad are taking the milk out of the $4,000 fridge while the teenaged daughter is playing the latest CD on her iPod, and where mum and dad think it is value for money to text her to tell her that grub is up on the table. That is Labour’s idea of the extension of the welfare State. My deputy leader, Gerry Brownlee, pointed out to me that when Michael Joseph Savage rolled out welfare in this country, he never intended for one moment that people living in $800,000 houses would be trapped as part of the welfare State—never ever.
Working for Families is a real “Maharey special”. It started as a mess, it was completed as a mess, and it will remain a mess the whole way through. It is easy to forget that just 18 months ago we were arguing the case, rightfully, that New Zealanders may have now forgotten about: that a family earning $38,000 will get to take home only $2,000 less than a family earning $60,000 a year. That is wrong.
Hon DAVID CUNLIFFE (Minister of Immigration): It is interesting to follow that member—a member who has eloquently stated the case. He was raised in a State house, went to a State school, and has dedicated his professional career to making sure that the next generation does not get the chances he had—which put him here in this House with a good education. I ask: what about the next generation of John Keys? Are we to use the excuse that social services rob them of their dignity? I see sitting opposite Tariana Turia, who said she does not want to see a world where any Māori needs welfare and, on the face of it, I agree. But the sad thing is that we live in a world where not everybody yet does have the skills, the qualifications, the house to live in, and the good job—and until people do we will stop Kiwi children from falling between the cracks. We will ensure that Kiwi children get the chance that John Key got.
Gerry Brownlee: Tell us about fixing the education system.
Hon DAVID CUNLIFFE: Gerry Brownlee said today that there is no such thing as an $11 billion cost to the tax package. Well, that is very interesting, because on Larry Williams’ show on 9 February—
Gerry Brownlee: I raise a point of order, Madam Speaker. I made no such statement today. I did point out that there is quite a difference between tax forgone and cost. If the Minister has not worked that out, then he should take himself back to his office and do some study.
The ASSISTANT SPEAKER (Ann Hartley): No, the member will be seated. He knows very well that that is not a point of order; it is a debating point.
Hon DAVID CUNLIFFE: The unofficial transcript records the member as saying that a costing of an $11 billion package over 3 years was quite untrue. That is in direct contradiction to John Key’s statement: “Let’s understand, you know, from the last tax package which we had was, um, probably the largest single proposed tax plan, ah, I think New Zealand’s ever seen. I mean it was ‘$11 billion’, and the estimates are $3.5 billion of borrowing.” Borrowing for what? It was borrowing to give tax cuts to that member’s rich mates—men who bulldoze other people’s houses so they can build their tennis courts; men who dedicate their careers to ensuring that the next generation cannot get what they did.
I want to talk about tax, because on 1 April we are bringing in tax cuts worth about the same as taking 2c off the business tax rate—$1.4 billion. But the cuts are better targeted. They are targeted at the things surveys tell us that Kiwi businesses most want—things like not paying provisional tax off at the rate of last year’s earnings. Earnings go up and down, and if people have a bad year they do not want to be paying tax off at the higher rate they paid the previous year; they want their tax rate to move with their income. And we have fixed it—we have fixed it in this tax package. Business told us that fringe benefit tax was a “pain in the rhetorical”, so we have raised its threshold level to ease compliance costs. Business told us that PAYE was difficult to administer. Well, the fix was something both parties supported, so we have subsidised payroll agents to make it easy. We have also provided international recruitment benefits and new rates of depreciation for high tech.
You know, John Key thinks that the best way to make money is to buy a big house. Well, maybe he will make money, maybe he will not, but it is not good if New Zealanders think their country will get rich through real estate. Hey, we will get rich as a country when we build things, make things, and export things, not when we speculate on property or foreign exchange! If we are to build and to innovate, we need low depreciation rates on investment and technology, and that is what we are bringing in on 1 April. We are bringing in low depreciation rates on technology—tax cuts for innovators. That is what is in this package.
In this Parliament it is fair to say that some days are better than others. I can say to members opposite that 1 April will be a red-letter day for New Zealand and a red-letter day for the Labour Government. John Key said we had gone down the gurgler. Well, I do not know whether he has noticed, but we are still on the Treasury benches and he is still in the Opposition. He will be an old man before he gets out of there at this rate, because we are governing in the interests of all New Zealanders, and not just John Key’s tennis club. With the Working for Families package, interest-free student loans, an increase in the superannuation rate, and the business tax package worth 2c off the business tax rate, what a day it is for New Zealand, and what a day it is for the Government!
Dr the Hon LOCKWOOD SMITH (National—Rodney): My colleague John Key has just interjected by pointing out that 5 minutes can be a long time when one has to listen to someone like Minister Cunliffe. This Labour Government’s Working for Families package is a serious issue. One of what the Government claims to be its main aims is exactly this: “Make work pay by ensuring that people are better off by being in work.” I want David Cunliffe to reflect on these facts—and I will quote figures from the annual report of the Inland Revenue Department—given that aim of making work pay by ensuring that people are better off by being in work—
Hon David Cunliffe: I raise a point of order, Madam Speaker. I would be happy to seek leave to take a further call, as the member suggested, should he wish.
The ASSISTANT SPEAKER (Ann Hartley): That is not a point of order. The member should not interrupt other members’ speeches by making points of order that are not points of order.
Hon David Cunliffe: I thought the member was asking me to seek leave, and I am happy to do so in order to explain the point he raised. I seek leave to take a further call to explain the point the member raised.
The ASSISTANT SPEAKER (Ann Hartley): The member has sought leave. Is there any objection? There is objection.
Dr the Hon LOCKWOOD SMITH: I want that arrogant Minister to listen to this. If this policy is about helping people get into work, then I want to explain these facts. Take a woman who has three children, who is on a benefit, such as the domestic purposes benefit, and who is trying to get into work. At $10,000 of earned income, she will still receive most of her domestic purposes benefit. Very little of it is abated away. She will still get almost the full domestic purposes benefit if she is earning $10,000. To be independent of the domestic purposes benefit and to really get into work where she will be independent of that benefit, she has to earn over $25,000 a year. So she has to go from $10,000 of earned income to $25,000 of earned income. It is then that she is really in work, because at that point she is virtually independent of the domestic purposes benefit.
I want David Cunliffe to tell this House how much he thinks that woman gets to keep of the extra $15,000 she earns. I will tell him what she gets to keep. Of that extra $15,000 she would have to earn to become independent of the domestic purposes benefit, that member’s Government takes $13,845 of it and leaves her with $1,155—and he calls that helping poor people!
John Key: He thinks it’s funny.
Dr the Hon LOCKWOOD SMITH: He thinks it is funny—and he thinks it is going to be all right.
I want the next Labour speaker to tell us how that is helping people get into work and making work pay. When people try to get off benefits, and try to become independent of the benefit system and be in full-time work, that Minister’s rapacious Government takes, through that entire income range—
Hon David Cunliffe: We’re giving it away.
Dr the Hon LOCKWOOD SMITH: Giving it away? The Government is taking it from them! As those people work harder and harder to try to attain the dignity of earning their own income for their children, that Minister’s Government, through that entire income range from $10,000 of earned income through to $25,000 of earned income, takes 92c of every dollar they earn.
Hon David Cunliffe: I raise a point of order, Mr Speaker. Earlier, the member asked me to take another call, then refused leave for me to do that. I wonder whether he is trying to ignore the fact that wherever the threshold is there will be an abatement effect—unless he advocates a universal benefit.
The ASSISTANT SPEAKER (H V Ross Robertson): The member will be seated. That is not a point of order. It is a debatable issue, and I remind members that frivolous interjections designed to break up a speech are out of order and will not be tolerated.
Dr the Hon LOCKWOOD SMITH: I know that members opposite are embarrassed about this, because they claim to actually care about poorer working people. It is a disgrace. Someone mentioned debating points, but the figures I am quoting are the Inland Revenue Department’s figures on this great Working for Families package. That is what this Government is doing.
OK, the Government might be going to give some of this money to someone in an $800,000 house with kids who have iPods, cellphones, and what have you, but if it cares about those poorer people on benefits who are trying to work to earn more so they can stand on their own feet, then it is a disgrace to take that money from them. When those people go to all that trouble to earn the $15,000 they need to get off the benefit and the Government takes almost $14,000 of that $15,000 from them, leaving them and their children with just $1,155 of the $15,000 earned, I think it is a disgrace. Labour members have gone quiet now, because that is nothing to crow about. It is shameful.
What is more, the Inland Revenue Department’s figures show that it is not just the way the Government is taxing these people that is a disgrace; the churning and waste is also a disgrace.
JILL PETTIS (Labour): At the beginning of the year the Prime Minister said in her statement: “There is a world of difference between Labour’s “New Zealand way” of promoting higher wages, based on higher skills, innovation, productivity, and sustainability and the right-wing parties’ standard prescriptions of slashing the tax base in public spending, cutting back on employees’ rights and protections, sacrificing the environment, and deregulating and privatising. That was the agenda New Zealanders revolted against in 1999 and have rejected ever since that time.” This is a day when we in Labour are very proud to be part of Labour, because today we are talking about a fabulous range of policies that will be implemented on Saturday. We are proud to be members of a party that is progressive, forward-looking, and inclusive and that still believes in universality—as did our first Prime Minister, Michael Joseph Savage, a man of whom we are very proud.
I also remind members opposite of what their current but temporary leader, Don Brash, has said in the past that refers particularly to universality, and I think it is particularly important to put it on the record again. In March 2004 he said: “I’m saying there are racial components in the allocation of healthcare and education funding—in that sense, I suppose you can say I’m saying Māori are given too much.” Given the comments National members made this afternoon during question time and their obvious lack of enthusiasm during the debate this afternoon on the Working for Families package, I ask them what parts will they cut? Which families will they cut income from? This is the Government that has got more people off benefits than any National Government did in recent years—and $11 billion worth of tax cuts would not deliver the kind of money this Government’s policies will deliver to working New Zealanders.
Labour listened very carefully last year to what New Zealanders said they most wanted. They said that what they wanted most was more help for New Zealand families, more help for working families, and more help for people when they need financial assistance the most, which is when they are raising their children. We all know that raising our children is the most expensive time of our life. Labour listened; Labour is delivering. And I am proud we are delivering.
I am very proud to live in the Wanganui-Taranaki area, and I am very proud of what we have done for families in that area. We are already providing $49 million extra in financial assistance to families who are working and helping to raise their families. We are also assisting more than 2,500 families who are receiving $12 million in family assistance. Six hundred working families are getting more than $1 million through the accommodation supplement, and 500 families, and more, are receiving assistance through the accommodation supplement. These are fabulous sums of money that are going directly into families’ pockets.
Where are those families spending this increased income? They are spending it on their children and in their local towns. An example of how that is benefiting our local towns is that in 2001 Wanganui had 36 vacant shops. Today only eight are vacant, and development plans are under way for five of those, so now only three shops remain empty in the Wanganui main street business district. What has happened since 2001? We have had a Labour Government whose policies have provided a direct form of assistance to the whole community in which I live, and to communities throughout New Zealand from North Cape to the Bluff. Families spend their money locally. Money is made round to go round, as they say, and this money is going back into the communities where families throughout New Zealand live. This is not just about assisting families through the Working for Families package; this is about a whole suite of policies that will benefit New Zealand.
Hon MAURICE WILLIAMSON (National—Pakuranga): There are a number of things that one can prophesy and forecast in the world and at the time people do not listen at all, and then many years later when those things happen, everyone asks why someone did not say something about it. I can remember in the 1990s, coming back from seeing some of the research laboratories in the United States that were looking at things like DVDs. I would go along to Cabinet and talk about those things called DVDs, and everyone thought they were some sort of a disease that penicillin would cure. Now, DVD is just a common, everyday occurrence.
I remember talking about the Internet. I had seen a trial of the Internet with email flowing into it. I came back so excited. I remember several of the senior Cabinet members saying that no one would even have a personal computer on his or her desk, because it was so hot. The reason I am saying this is that I am sending another warning today, and I hope it will be recorded in Hansard properly so that the media and the talkback hosts will refer to this speech of mine, made on 29 March, about Auckland’s infrastructure deficit problems and the nightmare that people will face during all the years running up to, but specifically at the time of, the 2011 Rugby World Cup. I say that because the Prime Minister raced off to Ireland and gave assurances, as part of the bid, that infrastructure would be dealt with. So I want to raise with this House some specifics about what I think are the problems and how they will emerge.
First, I take members back to the Transit document of August last year. Remember, this has been superseded by a new plan that wipes out half of that stuff and completely ridicules it, but I will take Dr Cullen at his word: “We will find the money to go back to the August update.”
John Key: He’s going to borrow it.
Hon MAURICE WILLIAMSON: OK, we will take Dr Cullen at his word and assume we will go back to it. Even if we go back to this plan—the plan of August last year—I remind members what Auckland will be in the middle of when the Rugby World Cup is on. Here are the four biggies. The first is a second harbour crossing, across the Māngere Bridge area. I have to say that while that is going on, the disruption to traffic and so on will be catastrophic. If members do not know how important that is, look at what happened when Transit closed the Māngere Bridge a while ago to do some work.
John Key: On a Saturday.
Hon MAURICE WILLIAMSON: Yes, on a Saturday, and it caused absolute mayhem. I shall give members the exact dates for that particular bridge project. The Māngere Bridge extension, the Manukau harbour crossing, will start in 2009-2010 and finish in 2012-2013, so it will be well and truly into the middle of the mess—
John Key: That’s if you’re lucky.
Hon MAURICE WILLIAMSON: That is if one is lucky, as my colleague John Key says. But I am taking Dr Cullen at his word. There are some other big ones. I am sorry that the Minister of Transport is from Dunedin, his predecessor was from Dunedin, and the one before him was also from Dunedin and they do not understand Auckland’s transport problems. But I shall tell members about a couple of others. There is the Avondale extension of State Highway 20. Right now, motorists come out of Auckland Airport, head north down State Highway 20 towards the city, cross the Māngere Bridge, hit Hillsborough Road, and there should be—and I am happy to pay for it—a sign that states: “You’re on your own from here, suckers”, because the motorway has just stopped altogether and motorists have to work their way through some little suburban street network to see whether they can get themselves to town. That can take an hour and a half or 2 hours, and it is getting worse all the time. Is the Avondale extension of State Highway 20, which would take that motorway right through to join up to the north western motorway, on the plan? Yes, it is. It is on the plan for commencement in 2009-2010, and completion some 8 years later. So, again, it will not be built in time for the Rugby World Cup, it will not be available; it will be just a major construction site causing more chaos and mayhem.
How about the harbour bridge to city link? That is considered to be vital if we are to move transport from the North Shore in and out of the city. I have here the details of the harbour bridge to city link. This is better. Construction will start in 2008-2009 and finish in 2013-2014. So, again, the harbour bridge to city link will be halfway through its major construction when the Rugby World Cup is on. And here is the doozy of them all. I do not think that anybody who is not from Auckland really appreciates how vitally important the Newmarket viaduct is to the city. Until State Highway 20 is built, the only north-south route through the city is via the Newmarket viaduct. During the day, even at non-peak times, it is crowded. It will be halfway through its refurbishment when the Rugby World Cup is on, and that is an outrage.
MOANA MACKEY (Labour): This has been a very interesting debate. National is obviously and clearly rattled by the Government’s Working for Families package, the next stages of which are going to be rolled out on 1 April 2006. It is very amusing to be lectured on beneficiary numbers and how to get people off benefits and into work by a party that saw beneficiary numbers spiral out of control, and saw those people who were living on a benefit pushed further and further into poverty. This Government has a phenomenal record of moving people off benefits and into work. I wonder whether the $11 billion worth of tax cuts that National promised at the last election would have come at the cost of cutting many of the good programmes. They might not suit National Party rhetoric, but they are actually delivering results. At the end of the day that is what we are here for.
But I want to talk today about the student loan policy, because 1 April 2006 will be a red-letter day for students. This is something that students have fought for for a long time. It will benefit students who have already been through the system, it will benefit students who are currently in the system, and it will benefit future students. This Government thinks that one should definitely pay back the loan that one has borrowed, but one should not be crippled by the burden of the interest that is charged upon it. I endorse that policy. I remember what it was like to be a student under Dr the Hon Lockwood Smith, who was so proud of his student support policy that he was climbing out of windows at universities to avoid talking to students about it. But I do hear in recent times that he has felt a little bit of remorse, perhaps, about the way the student support policy was introduced. Although I welcome that I say that it is too little too late.
The student loan policy and the interest charged on student debt have caused a number of sociological problems that, if not dealt with now, will cause big headaches for Governments in the future. We make a number of presumptions when we look at issues such as superannuation. One presumption is that people will own a freehold home by the time they reach superannuation so that they can survive on the level of superannuation that we afford to all superannuitants. With the advent of the student loan debt we have seen young people—single, couples, or families—delaying, first, having a family, and, second, buying a home, to the point where there is concern that they may never own a freehold house, and that that would severely impact on future Governments. I am very, very pleased that this Government has decided to take charge and to make a bold move today to nip that in the bud.
It is very interesting when one hears members on the opposite side of the House constantly bleating at the Government about the brain drain. They are constantly saying that we have all these people going overseas and asking what are we are doing about it. I have a lot of friends who are overseas. Most of them left during the National Government—I do not know whether that was deliberate; it was probably just because they graduated and went on their OEs, if I am to be fair—but they have not come back. Why have they not come back? Because they have not set up student loan payments. This Government is putting in place an amnesty that will allow students, without penalty, to set up loan repayments from overseas. Many people I know who are overseas will do that. But what is particularly good is that they are talking about coming home. While they were overseas they could escape their student debt.
Members opposite seem to think that graduates think more of tax cuts than they do of the fact that they pay 10c in every dollar that they earn straight over to the Inland Revenue Department. National has no idea about the incentives involved in repaying a student loan. The biggest incentive to repay your student loan is when you see that there is finally light at the end of the tunnel; when you make your repayments and you see—
The ASSISTANT SPEAKER (H V Ross Robertson): Order! You are bringing the Speaker into it.
MOANA MACKEY: Sorry, Mr Assistant Speaker. I know that you do not have a student loan. The biggest incentive for people to repay their student loans is when they see that there is finally a light at the end of tunnel, and that the interest is not so burdensome that they are never going to get on top of it. Indeed, in the 1990s, under the National Government, I thought I would never get rid of my student loan. I thought there was a very real prospect that for the rest of my life I would be servicing the interest by paying 10c in every dollar straight over to the Inland Revenue Department, and that I would probably die with my student loan. There were many other students who felt the same way.
Incremental changes over the years have made this a lot better and made a difference. I see Brian Donnelly putting up his hand, and I acknowledge him. But we need a bold move; we need a bold change. Remember, students do not have a choice about whether to pay back their student loans. It is not like they can suddenly decide that because there is no interest they will not repay them. They are compelled by law to pay 10c in every dollar. We say to them that we value the contribution that graduates make to this country.
GORDON COPELAND (United Future): Your mailbag, Mr Assistant Speaker, like those of many other members will, I know, be full of letters from New Zealanders appealing to this House to get away from malicious personalised attacks and to debate instead the many serious issues that confront our nation, its families, and its people. United Future wholeheartedly agrees with those sentiments.
Today I want to utilise my time to talk about a number of those important issues. Following 21 consecutive quarters of economic expansion, the New Zealand economy contracted by 0.1 percent in the quarter ended December 2005. That news coincided with the announcement that our balance of payments deficit was no less than $13.7 billion for the year ended December 2005, 8.9 percent of GDP, and coincidentally also the worst December year result since 1984 exactly 21 years previously. These figures should act as a wake-up call to every single party, and every single member of this Parliament. We should be collectively applying our minds to work constructively and together towards the goal of improving, and improving rapidly, the strength of the New Zealand economy.
I want to turn to a couple of specific examples. Last week a group of wool growers called by my office to report that in real terms, the price of wool is now at an historic low. In addition the existing industry structures are, they believe, dysfunctional and beyond the point of no return. Indeed, returns to growers are now so bad that they told me some wool growers have decided to change their farming practices because it no longer pays to worry about wool quality. Rather, sheep are being farmed simply for their meat.
I well remember that the meat industry was in a similar perilous state in the early 1980s. I was one of a number of consultants taken on at that stage by the Hon Bill Birch in his capacity as Minister of National Development to find a new pathway forward for the meat industry. Our conclusion was that it needed nothing short of a reformation. We called for that reformation, action was taken, and that industry has gone on to success. Nothing short of a reformation for the wool industry is now necessary. So today I call on the Minister for Economic Development, the Hon Trevor Mallard, to emulate Bill Birch’s example, call together the best brains in the nation, and build a cross-party consensus to undertake a total reformation of the wool industry in this country. It is tragic. We produce wool, and our wool growers get less than 1 percent, normally, of the retail price of carpets or wool at the other end of the scale. It is simply still in the colonial era and needs to come out of it.
Forestry is similarly in a slump. The current problems are again acute, serious, and urgent. We have a stand-off between the New Zealand Forest Owners Association and the Government at a time when the industry is already under pressure because of international wood prices. The stand-off is specifically about the Government’s Kyoto Protocol - driven deforestation cap, which aims to hugely penalise forest growers if the cap is broken, but steadfastly refuses to contemplate providing any incentive at all for replanting following harvest or, indeed, for new greenfields planting. That needs to change, and change fast.
In December 2005 the Hon Nick Smith wrote to the Hon David Parker, then the Minister responsible for Climate Change Issues, offering National’s cooperation in a bipartisan approach to this issue. I am disappointed to learn that to date that letter has not even been acknowledged. That is simply not good enough. Today United Future appeals to both Labour and National to park politicking for a bit and agree to cooperate in a bipartisan and, indeed, a multiparty attempt to resolve the serious issues.
In the late 1950s, early 1960s, in the United States of America, Lyndon Johnson became very popular and subsequently became Vice-President, because when he was leader of the Democratic Party he said: “We have some serious problems. I’m prepared to put party politics aside for a while and work with the Republicans for the good of our country.” It was immensely popular.
Hon Maurice Williamson: I raise a point of order, Mr Speaker. I hate to interrupt the member’s speech, and this is not aimed at the member, but there is a very strong Standing Order to the effect that there must be a Minister in the House at all times.
The ASSISTANT SPEAKER (H V Ross Robertson): There is.
Hon Maurice Williamson: There is?
The ASSISTANT SPEAKER (H V Ross Robertson): Mahara Okeroa is here. He is a Minister.
GORDON COPELAND: That proves that cooperation in the national interest can also be good politics. I think that there may be people in the National Party who aspire to lead their party and become Prime Minister, and I say to them that it will do their political careers no harm at all if at this point in history, given those sad economic statistics, they decide to cooperate with the Government on the sorts of issues—
The ASSISTANT SPEAKER (H V Ross Robertson): I just say to the two members who are interjecting on one another that the rules permitting interjections are predicated on the assumption that the person being interjected on has the floor. Neither of those members has the floor. Interjections are not permitted when they are directed at a member who does not have the call. I am sorry, Mr Copeland, but there was a criss-cross going on and it was disrespectful to you. Please continue.
GORDON COPELAND: Thank you, Mr Assistant Speaker. I very much appreciate that intervention, because I was trying to get this House to concentrate on the serious issues confronting this country. I was saying that if National is prepared to work with Labour, then my appeal would be also to Labour members to get off their high horse. Sometimes humility is a virtue to take a nation forward. Sometimes parties need to decide to put their party political differences aside so they can begin to work constructively to take this nation forward. That is what the people of New Zealand are asking of us, and I for one am listening.
CRAIG FOSS (National—Tukituki): This current Labour Government is arrogant, tired, and out of touch. This current Labour Government is starting to resemble the socialist Governments of old, but, perhaps, with a bit more lipstick. As a senior Labour MP said to me just the other day: “This is starting to feel like 1997 all over again, but this time we’re on the other side.” Well, I say: “My friend, history has a tendency to repeat itself. The trend is your friend.” That senior Labour MP knows what is going on.
John Key: The trend is your friend.
CRAIG FOSS: Yes, the trend is his friend. After the next election, which will be an early election, the commentators will look back not particularly fondly on 7½ years or maybe 8 years of Labour-led Government. The legacy the current Labour Government will leave is a massive extension of the welfare State, a massive extension of dependency, a massive explosion in the size and influence of central government in our economy, and a massive extension of social welfare into the homes of our families—welfare for families.
The massive expansion of the State under this Labour-led Government has done nothing, and will do nothing, to increase our productivity. It has done nothing, and will do nothing, to increase our OECD rankings. In fact, after the next couple of years, a ranking of No. 20 in the OECD will become but a distant and fond memory as former Eastern bloc countries and former Third World countries pass us, push us aside, and push us down to the 30s in the OECD rankings. That is not good, at all. That is not a good legacy.
From the 1999-2000 to the 2005-06 fiscal years, nominal GDP has grown by about 43 percent, in spite, I might add, of the actions of the current Labour-led Government. Crown revenue has grown by 56 percent. That is the rope that suffocates the growth of New Zealand. That is the rope that suffocates the growth of our country. Ongoing, unaccountable, wasteful programmes make the headlines every other day, as the Government transfers and redistributes hard-earned taxpayer funds into them. That is absolutely appalling. The latest GDP quarterly figures, which came out the other day, showed that GDP in the December 2005 quarter fell by 0.1 percent.
John Key: What?
CRAIG FOSS: It fell by 0.1 percent. If we have one more of those negative numbers, we are in a recession. As Westpac recently pointed out, New Zealand is in the cack—I think that was the word it used.
But interestingly—and this contributes to that number—Government administration in the 2005 year grew by 10.3 percent. The Minister of Finance tried to fob that off by saying it was something to do with all the census workers who had been hired. Well, if we look at the same statistics, we see that 5 years ago there was not a great blip in Government administration. That is what is squeezing out the private sector and suffocating our growth. That shows, again, how tired and out of touch this current socialist administration is.
Labour is not working. Labour has blown one of the best chances we have had in many, many years. The Working for Families package comes in on April Fool’s Day. Sixty percent of New Zealand did not want that project; about 60 percent actually wanted tax cuts, as indicated by the votes for the parties. Only 40 percent of voters, roughly, voted for Labour. The Working for Families package is not working to further families’ ambitions. Working for Families is not working for Māori families; it does not even go near to their average take-home pay. Working for Families is not working for hard-working New Zealanders, who, as we discovered today, can earn only $480 gross per week before they have to contribute to families that earn close to and even over $100,000 a year. Devastatingly, the Minister in charge of that package said that was a fair outcome.
Again, I say the Labour Government is out of touch, tired, and about to fail. This issue is not just political. I am not here just to make a political speech. This issue is personal, because the lack of ambition of the current Government affects my future and my family’s future. I take that personally. The Government is trashing the future that my children will inherit in this country, by creating an environment where it is no longer OK to dream of becoming better—where it is not OK to dream, to be ambitious, or to try to better oneself and enjoy the rewards of it. People are being made into April fools, but they will not be fooled again.
DARIEN FENTON (Labour): What a pathetic contribution from that member! I have heard of wishful thinking, but I have to say that that takes the cake.
I am very, very proud to be part of a Government that is making a serious commitment to families, the low-paid, those with children, and those who are trying to get ahead. We are in Government to make a difference, and up and down the country New Zealand families, young and old, will this weekend be celebrating the measures that this Government is delivering for a better New Zealand.
The Working for Families package is one of the most significant poverty-reducing measures any Government has taken in decades. Bringing up the next generation is the most important thing we have to do as a nation, and almost three in every four New Zealand families with dependent children will be entitled to extra financial support under our Government’s Working for Families package. On the North Shore, for example, 9,000 working families are already receiving a total of $51.5 million in family assistance, 4,800 working families are getting $24.2 million through the accommodation supplement, and 1,100 families are receiving childcare assistance. That is $259.6 million in extra financial assistance going to thousands of North Shore residents and parents who are working to raise their families. From 1 April even more families will be able to get their share of Government support to help bring up their children.
This Government has already delivered a lot to families. We have the lowest unemployment rate in the OECD. We have built more State houses and made them affordable. We have provided 14 weeks’ paid parental leave, and we have increased the minimum wage by 8 percent from Monday of this week. We are also introducing 4 weeks’ annual leave from next year.
We have taken some giant steps towards tackling the lingering social deficit from the 1990s, when National’s policies were all about economic gains for the better-off at the expense of the not so better-off—and nothing seems to have changed. During that time there was no progress in recognising the costs and demands of raising families. New Zealand in the 1990s was one of the meanest countries in the OECD when it came to financial support for working families or families with children. Families increasingly found themselves on the wrong side of a growing divide between rich and poor, with serious consequences for children. We remember the market rents from 1991, when the Housing Corporation progressively increased rents on housing from 25 percent of income to market rates, which forced overcrowding, sub-standard housing, and Third World diseases. This Government has fixed that, and we are delivering on our commitments to our country’s future.
Another lost generation under National were students, who, if they wanted to improve their chances of a decent life through tertiary education, had to mortgage their futures. On 1 April tens of thousands of students will welcome the scrapping of interest on student loans for those who live in New Zealand. That will reduce the debt burden on students, and knock years off repayment times. It means that more families can plan for their children to enter tertiary education, because Labour is making it more affordable.
Of course, there is more: 490,000 senior citizens will receive a boost in their standard of living through the increase in the rates of superannuation and the veterans pension. As my colleague the Hon David Cunliffe said, businesses will benefit from the biggest cuts to business taxes since the late 1980s.
Meanwhile, what is National up to? Its members have no new ideas. They continue to bang on about tax cuts, but New Zealanders know that tax cuts do not deliver better education and improved health systems. They are so devoid of ideas that they have resorted to personal attacks, smear campaigns, and witch-hunts—and I appreciate the comments of my colleague Gordon Copeland on those matters—which are not what the people of New Zealand want to see. But National is doing that because it cannot think of anything new to say to the New Zealand public. I say that the public did not vote for the muckraking and character assassination that we have seen in our Parliament in recent weeks. People want to see us getting on with the serious business of building New Zealand and helping it succeed.
Labour is making a difference. It is changing lives for the better, and that is what responsible Governments do. We are in Government to deliver. I am proud to be part of a Government that is focused on its programme for families young and old, for economic transformation, and for our national identity. Through Labour, New Zealand families are getting ahead, and I feel privileged to be part of a Government that continues to deliver.
CHRIS TREMAIN (National—Napier): There is an old mantra in this country—in this fine New Zealand of ours—in our communities, and in our families, and it goes something like this: when times get tough, one pulls in one’s belt, spends less, works harder, and looks for greater efficiencies. Times are tough in this country. The rate of growth has almost halved in the past year, with pain now spreading from the export sector into the domestic markets.
I will talk about the export sector for a minute. We have all known what the situation has been like in the horticultural sector and the fishing and forestry industries for the last 6 months to a couple of years. Now we are seeing farming being brought into that situation. We have seen dairying suppressed for 2005 and 2006, and the outlook for 2006-07 is bad, as well. Sheep prices are down 25 percent. We will no longer be able to rely on those high commodity prices that this Government has depended on for the last 3 to 6 years. Tourism is also feeling the pinch. The number of visitors in the 3 months to January was down 1.4 percent on last year. Tourism is an industry that should be growing year on year.
We now have solid data showing that the domestic market has slowed down considerably. Growth in retail revenues has stopped. The housing market has slowed, if not stopped altogether. What is more, overall economic growth has flattened out to nothing.
Hon Member: It is negative.
CHRIS TREMAIN: It is negative. In the last quarter, ended 31 December, we saw growth drop below the line into negative growth territory. So what are we doing? Are we spending less, under that old mantra? No. Are we looking for greater efficiencies? No. Are we encouraging people to work harder? No. So what is this Government doing? It is undertaking a huge spend-up. It is spending millions more. It is increasing the inefficiencies, with tax churned through the system. It is creating a disincentive to work, rather than an incentive, and it is doing that via a welfare package called Working for Families. As John Key said before, it should be called “Welfare for Families”. That is what the Government is introducing. Let us not make any mistakes about that—it is simply welfare for families. Middle-class families, complete with their iPods and their cellphones, are now able to claim their entitlement.
New Zealand was the first country in the world to introduce the welfare State, which was a noble goal. The intention was to help those who cannot help themselves, but now there are families earning over $100,000 who are eligible for a State handout. From 1 April 348,000 families—in effect, three-quarters of all our families—will become beneficiaries. This is despite a Herald-DigiPoll stating that 60 percent of our nation do not want it. They would prefer a change to their tax situation—that is, they want their taxes to go down. Bizarrely, people who are deemed rich—those in the 39 percent tax category, earning above $60,000—at the same time are deemed poor enough to require a family assistance benefit. It is crazy.
At a time when we should be pulling our belts in, when other countries are trying to get people off the welfare system, what are we doing? We are bringing 348,000 people on to it. Nothing is for free. Families have to pay taxes for all those benefits. Much of the money is just being recycled straight back to the people who are paying for it in the first place. Let me make it clear: it is not the Government’s money; it is taxpayers’ money. I hear time and time again that people should feel honoured to be getting it back, but it is their money in the first place.
The Inland Revenue Department now has 470,000 staff, with an annual expense of $475 million. It is a tax army—an army of Inland Revenue Department merchants, tax accountants, and tax lawyers. It is now four times larger than our own land army, would members believe. On top of that, we have a TV advertising campaign to encourage those people earning over $100,000 to get in there, cap in hand, and pick up their benefit. It is costing $21 million to do that. Would it not be easier to collect less tax and leave more in people’s pockets?
GORDON COPELAND (United Future): I seek the leave of the House to table a letter I mentioned in my contribution to the debate, which is from the Hon Nick Smith to the Hon David Parker and dated December 2005, regarding National’s willingness to work with the Government on climate change issues.
Document, by leave, laid on the Table of the House.
The debate having concluded, the motion lapsed.
Bills
Westpac New Zealand Bill
First Reading
Hon MARIAN HOBBS (Labour—Wellington Central): I move, That the Westpac New Zealand Bill be now read a first time. This is a private bill promoted by Westpac Banking Corporation for Parliament’s consideration. In accordance with the Standing Orders, the notice of intention to promote this private bill has been distributed to those persons who have a direct interest in the subject matter of the bill. It has been advertised publicly, and I commend it to the House. At the appropriate time I will move that this bill be referred to the Finance and Expenditure Committee.
The bill provides a mechanism to enable Westpac Banking Corporation’s retail business in New Zealand to be vested in a New Zealand incorporated subsidiary: Westpac New Zealand Ltd. Westpac Banking Corporation has operated in New Zealand since 1861 and currently operates in New Zealand as a branch of its Australian parent. The establishment of a subsidiary enables Westpac to comply with the Reserve Bank of New Zealand’s local incorporation policy, which was introduced in 2003. This policy provides that foreign-owned banks over a certain size are required to establish a New Zealand subsidiary, with its own board of directors, that is required to comply with New Zealand company law.
The policy assists the Reserve Bank in its regulatory approach in two ways: first, by reinforcing the importance of the self-discipline of banks by obligating bank directors to attest to the veracity of financial disclosure made by banks through their general disclosure statements. To date, this has been done by Westpac’s Australian board and its New Zealand chief executive. Following incorporation, it will be done by the directors of the locally incorporated bank, which will include at least two New Zealand - resident, independent directors, thereby increasing some of the local accountability. Secondly, the policy provides for greater legal certainty over ownership of the assets of the bank in the event of a bank failure under New Zealand law. This can help prevent a bank failure from spilling over to the wider financial system and developing into a systemic crisis.
Westpac and the Reserve Bank negotiated for some time over whether it would be necessary for Westpac to establish a subsidiary or whether another suitable solution existed. Ultimately the Reserve Bank was not satisfied that another suitable solution could be found and it has required Westpac to comply with its policy by establishing a locally incorporated bank. This bill provides for a new chapter in the long history of Westpac in New Zealand by creating the legal framework for the vesting of the assets of Westpac Banking Corporation’s New Zealand retail business into a New Zealand company: Westpac New Zealand Ltd.
Westpac Banking Corporation has a significant history in New Zealand. It is one of New Zealand’s oldest financial institutions, having begun life in New Zealand as the Bank of New South Wales in 1861. The bank expanded rapidly—it was the time of the gold rush—and was already operating out of eight branches throughout New Zealand by February 1862. In 1982 the Bank of New South Wales merged with the Commercial Bank of Australia, which also had operations in New Zealand, and the banking group became known as Westpac Banking Corporation, or Westpac, with the new name reflecting the bank’s focus on developing its business in the western Pacific region. In New Zealand the merger of the New Zealand business of Westpac Banking Corporation with Trust Bank New Zealand Ltd in 1996 led to the formation of Westpac Trust, incorporating the two elements of the merged business.
The relationship Westpac has with New Zealand is reflected in a number of ways, from the historical buildings throughout the country that bear the original names of the Bank of New South Wales and the various regional banks that became trustee savings banks, to the key sponsorships Westpac provides in sport, the arts, and through the red rescue helicopter. While Westpac has a long history in New Zealand of operating as a branch of its Australian parent company, the Reserve Bank of New Zealand now requires, for the purposes of satisfying its statutory objective to be in a position to minimise the impact on the financial system of a bank failure, that systemically important banks—those that have $10 billion or more in liabilities in New Zealand, other than to related parties—be incorporated in New Zealand. The retail business of the New Zealand branch of Westpac Banking Corporation currently fits this criterion; therefore, Westpac is required to comply with this policy.
Legislation is the only means by which the assets of Westpac Banking Corporation’s New Zealand retail business can be vested in Westpac New Zealand, for two reasons. Firstly, it is the only means by which Westpac Banking Corporation’s New Zealand retail business can be vested in Westpac New Zealand efficiently and economically without interference in the conduct and continuity of that banking business. That seamlessness is important and necessary for both the staff and the customers of Westpac. Secondly, legislation is the only means by which appropriate amendments to, and repeals of, existing legislation can be effected, as Westpac Banking Corporation currently operates under legislation in New Zealand through the Westpac Banking Corporation Act 1982.
The private Act of Parliament approach has commonly been used for bank mergers in the past—for example, the National Bank of New Zealand Limited Act 1994 and the Westpac Banking Corporation Act 1982. The bill is primarily based on a number of pieces of legislation that have facilitated transactions similar in nature to this one. The approach of using legislation to facilitate the vesting, and a subsequent vesting order to contain the details of assets and liabilities to vest, finds its origin in the health board model adopted in the Health Sector (Transfers) Act 1993, which, in turn, followed an approach previously used in the New Zealand Railways Corporation Restructuring Act 1990.
The bill also contains provisions commonly used in merger legislation, provisions previously used in bank merger legislation, provisions specific to Westpac’s circumstances, and provisions repealing section 23 of the existing Westpac Banking Corporation Act. Accordingly, the bill provides the overall legal framework for the vesting of assets and liabilities from Westpac Banking Corporation to Westpac New Zealand. The vesting is then implemented by a detailed proposal that must be approved by the Governor-General on the recommendation of the Minister of Finance by Order in Council. The requirements of the proposal to be included in the vesting order are set out in the bill and are based closely on the health sector model. Given the level of detail required to specify the assets and liabilities being vested, and the fact that the assets and liabilities of the business are constantly changing, a vesting order is the preferable way to manage this complexity.
The bill provides for Westpac New Zealand Ltd to be the universal successor, to minimise the risk that the change of ownership would not be recognised where contracts are subject to foreign laws. A number of common merger provisions have been included in the bill, such as provisions dealing with employees—the terms and conditions of employment are to remain the same, continuity of employment is to be maintained, and no claims arise from the transfer—provisions ensuring that the proposal does not place Westpac in breach of contract or of laws, and provisions to ensure tax neutrality on vesting. In addition, provisions specific to bank mergers have been included to ensure that the customer relationship will be unchanged, contracts are fully enforceable by the new entity, legal proceedings are not prejudiced, and documents remain evidence.
Finally, the bill repeals section 23 of the Westpac Banking Corporation Act, which gives New Zealand depositors priority over Westpac Banking Corporation’s New Zealand assets and requires the bank to have positive net assets in New Zealand. This section is no longer required, as all of Westpac Banking Corporation’s retail deposit business will vest in, and be conducted through, Westpac New Zealand Ltd. Westpac New Zealand Ltd will be subject to direct supervision by the Reserve Bank of New Zealand and will have to comply with its policies.
I have already referred to the practical considerations that underlie the necessity for this private bill. However, in conclusion it may be useful to reiterate for the benefit of members some of these considerations. Without the legislation, customers’ bank accounts in Westpac Banking Corporation could not legally be transferred unless each customer agreed to the transfer individually. That would cause considerable disruption not only to the beginning of the operations of Westpac New Zealand but also to all Westpac’s 1.3 million customers. On that basis I commend this private bill to the House, and I am confident that the House will support it. At the appropriate time I intend to move that the Westpac New Zealand Bill be referred to the Finance and Expenditure Committee.
JOHN KEY (National—Helensville): I rise on behalf of the National Party not to make a long address but just to say that the National Party will support this legislation. For the purposes of good order and pecuniary interest, I declare that I am a customer of Westpac, and I have been for 39 years since my mother opened an account for me in Canterbury and I got a passbook with, I think, a squirrel on the front. I have had that account with Westpac for 39 long and loyal years.
The member for Wellington Central has made quite clear the purposes of the bill around the need for local incorporation and the need for Westpac to move beyond what is currently a branch structure in New Zealand. I understand that the Reserve Bank of New Zealand supports the bill and is likely to make a submission when it goes to the Finance and Expenditure Committee.
Although I understand the position of the Reserve Bank on the ability to quarantine and understand what is a New Zealand asset—which becomes the legal position in the event of a New Zealand bank failure—I am a bit suspicious about what systemic bank failure may mean and what this legislation may achieve. In my own view, in the event of the collapse of Westpac New Zealand the parent company would in all probability bail the bank out, for reputational reasons if not for others. Anyway, in that case it would still be easy to understand what the New Zealand assets were.
This bill is, in a sense, forced on Westpac because the Reserve Bank wants to make sure that in the event of a parent company collapse, the parent company cannot take New Zealand assets out of New Zealand and put them into Australia or into other parts of the banking group. I think we are somewhat deluded if we do not think that that scenario would not only lead to a systemic crisis across, potentially, all the other banks in Australia, which run 85 percent of the banking system in New Zealand, but also be a widespread issue for the Governments on both sides of the Tasman to deal with. I simply make the point, as I have to the Reserve Bank, that we need to look only at the Asian debt crisis—at how far away it was and at its impact on the credit spreads and the various financial indicators of the New Zealand banking system—to see the effect that a very distant financial crisis can have on New Zealand.
That said, I say National understands the legislation and what is driving it, and we support its first reading.
SUE BRADFORD (Green): The Green Party supports the introduction of the Westpac New Zealand Bill for the simple reason that our members believe the banking system operating in this country should be more under the control of this country. We support the policy of the Reserve Bank of New Zealand, as noted in the explanatory note to the bill, that systemically important banks should be locally incorporated in New Zealand. Although Westpac may find it necessary to make a giant leap in having to incorporate here, including through this legislative process, in reality this bill is only a small step in the long march for New Zealand to regain its economic sovereignty.
I, like many others, was bitterly disappointed when the Trust Banks of New Zealand—with the exception of Auckland and Taranaki—were amalgamated and then privatised into Westpac’s grip. Those Trust Banks were synonymous with communities, ordinary Kiwis’ mortgages, and local economic development. Of course, their assets continue to support the communities of this country, but that is not the same thing as owning the bank and having some local control over local savings and investments.
Let us see what has happened in the last 10 years since Westpac took over the Trust Bank network. In 2006 the prestigious Roger Award for the worst transnational operating in New Zealand went jointly to Westpac and the Bank of New Zealand. The judges’ report and supporting documents make sobering reading. Ten years ago Westpac—and Trust Bank, which it later took over—employed 6,760 staff. Today it employs 5,004 staff. That is a reduction of 26 percent, yet its profit of $617 million is 396 percent more than it was 10 years ago. So staff who used to make the bank an average $146,000 operating income per year now need to make the bank $340,000 operating income per year. Staff have been forced to become more than twice as profitable for their bank, but their pay rates have risen by only 27 percent in those 10 years.
The bank forces up its profits by setting sales targets for staff to meet. Those targets grow each year to match the bank’s greed for larger profits, but the number of people employed to meet these targets falls. The number of Westpac branches has reduced in the last 10 years from 433 to 196, a reduction of 54 percent. This is despite Westpac’s total assets growing from $21 billion in 1994 to $42 billion in 2004, a growth of 100 percent. Net profit after tax for Westpac and Trust Bank combined grew from $155 million to $617 million between 1995 and 2005—a remarkable growth of 396 percent.
One of the pressures on interest rates is banks such as Westpac using performance pay targets to compel their staff to sell higher and higher levels of debt to customers. The Governor of the Reserve Bank has expressed concern on this matter. Westpac chief executive Ann Sherry simply rejected the governor’s claims that banks are playing a role in fuelling inflation and suggested the bank was simply responding to customer demand. However, Westpac customer service workers are set a target of 8,575 points per year to meet performance standards. They get 10 points for opening a new account but an extra 25 points for selling a credit card. Westpac customer consultants are required to get 13,305 points. They get 5 points for every $10,000 of home loans they sell and 5 points for every $1,000 of personal lending. No wonder we have an explosion of credit.
At union meetings at Westpac over the last year workers have also complained of being unable to take holidays at the same time as their children and of being asked to return from holidays because their worksite was understaffed. Staff in entire offices have been working late or missing morning and afternoon tea breaks without compensation. There is a high workload causing stress and pressures on the families of workers. Workers are coming to work because of workload pressures despite their being sick. Bullying is not uncommon within Westpac. In one case a pregnant woman in the call centre was told she would have to make up time after work if she went to a specialist’s appointment. Her husband called her union, FinSec, distressed at this behaviour. A FinSec organiser subsequently informed the call centre team leader of that person’s responsibilities under the Parental Leave and Employment Protection Act. The team leader then demanded that the 20-week pregnant woman produce a doctor’s certificate to prove she was pregnant and that the specialist’s appointment was related to the pregnancy.
Workers doing the late shift at the Phone Assist Call Centres in Auckland and Wellington do not get taxis home despite some of them not having cars, and the fact that in Wellington there is no appropriate parking available, anyway. Instead, Wellington staff have been taxied to the train station at times, despite the trains having finished running for the night. At one branch two staff members with outstanding performance records have gradually had their target review levels fall from five, which is outstanding, to one, the lowest mark, because they worked in a small town with a saturated market. They were put on performance improvement plans because of their low marks and threatened with transfer to another branch in a nearby town. Call centre workers are monitored so closely that when they make a 3-minute call to the union, they have been threatened with having to make up that time after work at the end of the day. Call centre staff have also been spoken to for taking more than three toilet breaks during the day. If they spend more than 17 minutes not ready and available on the phone during the 8-hour day, their quality assessment can be marked down, thus potentially affecting their pay.
The report of the Roger Award also outlined how Westpac, along with all other big banks, has used tax avoidance strategies to borrow overseas, channel the money through New Zealand, and re-lend it overseas. Through what the report described as a scam, these banks are paying as little as 6.7 percent tax instead of the official company rate of 33 percent. This information came from Reserve Bank documents that were leaked to the media. Reliable estimates put tax owed by the “gang of four” at $1.63 billion dollars. The unexpected taxation windfall of $500 million announced by Dr Cullen prior to the last election is believed by some economic observers to have come from the major banks.
Finally, New Zealand Westpac customers of all political persuasions have to put up with the highly partisan and ideological comments made by Westpac chief economist,Brendan O’Donovan. For all intents and purposes Mr O’Donovan acts as economic cheerleader for the National Party and is a constant critic of economic policies of Labour, the Greens, or any other of the Government support parties. There was blatant politicking from Mr O’Donovan prior to the election last year. To give one example, before the election Mr O’Donovan attacked the student loan policies of Labour and the Greens and was subsequently forced to admit that some of the estimates he was using to cost the loan scheme were somewhat extreme. The then Minister of Education, the Hon Trevor Mallard, described Mr O’Donovan’s figures as inflammatory, self-motivated garbage and stated that the bank had very selfish reasons for opposing the policy. Mr O’Donovan has also attacked the Working for Families package and strongly advocated unsustainable tax cuts. Recently, he has even attacked the Government’s Buy Kiwi Made programme that I am responsible for, before it has even been designed.
I hope that select committee members take a good look at this bill when it reaches them. The fact that an Act of Parliament is needed to facilitate the incorporation of Westpac in New Zealand means that Westpac should have even more obligations to be a good corporate citizen and a good employer. Its corporate behaviour will have to change on a number of fronts. I urge the select committee to not just go through the motions of hearing submissions and reporting back on this bill; its members ought to have an obligation to determine whether the legislation will actually change the behaviour of this bank. If the bank will not change, they should consider what amendments will be necessary to make sure that a bank relying on an Act of Parliament to incorporate in New Zealand actually does act as a good corporate citizen and a good employer.
Hon BRIAN DONNELLY (NZ First): I want to take only a very brief call, largely to explain that New Zealand First will be supporting this bill, and also to give some reason for that. We believe the bill actually falls very much into the compass of New Zealand First philosophy and its raison d’être. We believe that some of the policies based around the acolytes of people like Roger Douglas and, indeed, Don Brash, actually put the economic sovereignty of New Zealand at risk in times gone by, and this is a move in the right direction to retrieve some of that economic sovereignty that was lost in the past.
I listened very carefully to the contribution made by Sue Bradford, and I have to say I do not necessarily believe that the bill will change the business practice of Westpac New Zealand Ltd. However, if the bill shuts up the taxation loophole that she mentioned in her speech, then certainly it will be getting New Zealand First’s vote. We also take on board the point made by John Key that this move will mean that the parent company in Australia will not be able to take out New Zealand assets, for example, if it happens to get into trouble or fall over. New Zealand First will be supporting the bill to go through to the Finance and Expenditure Committee, and we will listen to all the arguments that are put forward there. Fundamentally, the real reason we are supporting the bill is that it is in line with New Zealand First’s philosophy of retaining New Zealand’s economic sovereignty.
HONE HARAWIRA (Māori Party—Te Tai Tokerau): Before I speak on the Westpac New Zealand Bill, I congratulate Sue Bradford on her comments outlining the requirements of corporate bodies in this country, and, in particular, on highlighting concerns about working conditions, holiday expectations, and reductions in bank sites—particularly at a time when a company is making excessive profits. I particularly take those comments on board because I come from an area where the Government shut down all the post offices—so we have none. I feel the impact of the reduction of services, and when I hear about banks doing the same sort of thing I am mindful of the need to keep tabs on how that happens and what we do about it.
I return to my kōrero. Although I have no great love for the way in which the Reserve Bank’s directives impact on the poor in our land, I do recognise the importance of ensuring that the biggest banks in our country are also incorporated here in Aotearoa. If those banks are charged with taking care of our money, then the Māori Party believes that they should be keeping our money here and offering protection to their clients here, as well. At the moment, ANZ, the National Bank, BNZ, and ASB are all incorporated here, and this bill aims to bring Westpac into that fold.
I am keen to speak to this bill, because some issues in respect of Westpac have a particular positive focus for Māori. I will focus on three of those initiatives, which other banks may want to pick up on, as well. In particular, Westpac held a series of hui to discuss the way in which to handle corporate social responsibility. Although Sue Bradford’s comments suggest that those discussions went in one ear and out the other, the philosophy is an approach that is very much in line with the Māori Party’s kaupapa of encouraging ordinary people to be part of decisions that affect them.
Māori are key stakeholders in any banking situation, and we applaud any steps taken by any banking organisation to recognise that goodwill. As the MP for Te Tai Tokerau, I can specifically acknowledge the Westpac initiative of helping Te Uri o Hau in the management of some $15.6 million in settlement assets with a practical project that assisted in iwi planning, social services, environmental and cultural initiatives, and leadership development. I note a statement from a chief executive officer of the time, who said that it is: “about recognising the importance of the contribution made to New Zealand by the Maori economy as a whole. Maori success is a broad, economic issue not just for iwi and the Government, but private enterprise as well.”
The other project I wish to mention is a manual that Westpac published as a result of its work with Te Uri o Hau, Ngāti Whātua, Ngāi Tahu, Tainui, and other indigenous communities from other parts of the world, particularly Canada. It helps tribes to determine best investment options. That publication, entitled Let’s Settle This!, provides options to iwi to help them identify how best to grow settlements, how to manage joint ventures, how to develop commercial entities, and how to manage education and social service programmes. I know those initiatives did not happen overnight, and I do not suggest for one moment that Westpac is all sweetness and light. In fact, the 1993 Māori Development Corporation report noted that cultural issues had not been addressed as well as they might have been by Westpac. But its progress in this particular regard is possibly a benchmark that other banks might take note of.
Māori have been into banking since way back in the 1800s, when they first cottoned on to the fact that there had to be something in this banking thing—otherwise Europeans would not be into it themselves. Indeed, the prospectus of the Maungatautari Money House noted that Māori people had been viciously wronged in their dealings with Europeans, who had largely profited thereby. It also noted: “our hearts are sorely grieved at this robbery of our people:” Apparently, nearly every Māori in the area banked with the Maungatautari Money House, but unfortunately it all came to nought when the money house and all its contents were lost in a fire. But the positive thinking was there.
The Māori Party supports this bill, and it is our earnest wish that local incorporation will be a continuation towards local development. Whānau are the ones best able to determine their own solutions, and we support their right to do so. We urge all banking institutions in Aotearoa to be part of that solution. We look forward to the Finance and Expenditure Committee investigating some of the points that were raised by the honourable Sue Bradford and others, and clarifying how some of those issues might be resolved, not just by Westpac but by all other banking institutions in the country, as well. At the same time, we look forward to the select committee process promoting positive initiatives from within the banking fraternity, as well, and ensuring that Māori development is not held back by poor employment practices.
GORDON COPELAND (United Future): I want to take a fairly brief call on behalf of United Future on the Westpac New Zealand Bill. Firstly, I say we support the passage of the bill. There are two underlying rationales and reasons that Westpac should incorporate in New Zealand, and therefore operate in this country through a separate subsidiary company of the international Westpac Banking Corporation.
The first of those reasons has already been well canvassed by other members of the House, and it is to do with the prudential supervision by the Reserve Bank. The Reserve Bank’s analysis, quite rightly, was that in the event that the parent company of what until now has just been a branch in New Zealand came under stress or, God forbid, failed, then the people who had deposited with Westpac bank in New Zealand could be at a disadvantage. In fact, because Australian rules are framed in a way that gives preference in that situation to the depositors who are Australian residents, it is almost certain that through the existing branch structure New Zealand depositors would have been disadvantaged in that eventuality, so this bill is necessary from that point of view.
The second reason I welcome the bill is to do with taxation, which has been touched on by Sue Bradford. It is quite clear, as has been conceded by the Commissioner of Inland Revenue to the Finance and Expenditure Committee recently, that the tax rate for companies, which is lower in Australia than it is here, is actually an incentive for Australian-owned companies operating in this country to manage their affairs to try to minimise their tax bill in New Zealand to the advantage of Australia; in other words, there is no longer a level playing field. Therefore, this incorporation will also make it much easier for the Inland Revenue Department to police its new thin capitalisation rules in order to ensure that the Westpac Banking Corporation pays its fair whack of tax, and that currently means 33c in the dollar—and no less than that figure.
In that regard the track record of Westpac Banking Corporation in recent years, and indeed other Australian-owned banks, is less than impressive. As Sue Bradford has mentioned, not only are they now, under the new rules, paying an extra $500 million per annum in tax than they were but in addition a significant figure—well in excess of $1 billion—is also in dispute with those banks. I think that is a scandal, when compared with the fact that every nurse who is working in an intensive care ward in a New Zealand hospital, every teacher who is teaching in our schools, and, in fact, all of the Kiwi battlers out there, pay their fair whack of tax because they have no choice. It is taken off them through PAYE. Good corporate citizenship in this country means paying one’s fair whack of the tax burden.
I also must express my disappointment that 85 percent of our banking sector has ended up in the hands of Australians. In many ways we are a very naive, non-commercial, and non-savvy country when it comes to these kinds of things. The Australians, of course, have a four pillars policy in place, which ensures that these banks will always be owned by Australians. They do not play by the kinds of rules that we played by when we decided to put these banks up on a block and let them go into overseas ownership. Of course, we are left basically with the Taranaki savings bank, which is a great bank, and I am also a great fan of Kiwibank. I think it is good that Kiwibank is here, and I wish it great success in the future because I believe we need to see an increasing share of the banking sector back into the hands of Kiwis.
For all of those reasons, I signal United Future’s support for the first reading of the Westpac New Zealand Bill.
Hon MARIAN HOBBS (Labour—Wellington Central): First of all, I want to thank my parliamentary colleagues for their support for this private bill. I also realise that I did not declare at the start that I, too, am a Westpac customer, so I lay that on the table. I am looking for detailed work to be done on the bill by the select committee, although I do not think it will necessarily be the detailed work that my colleagues Sue Bradford and Hone Harawira are asking for. However, I do commend Westpac and the people who have drafted this legislation for setting out, in clause 12, to provide tremendous protection for the bank’s staff. Too often in these situations, staff conditions may change—those are protected in the bill, as are the bank’s customers and the community. For the care that has gone into the drafting of this rather difficult legislation, I commend them. I thank you, Mr Assistant Speaker, and I thank the House for its support for this bill.
Bill read a first time.
Bill referred to the Finance and Expenditure Committee.
Bills
Resource Management (Climate Protection)Amendment Bill
First Reading
JEANETTE FITZSIMONS (Co-Leader—Green): I move, That the Resource Management (Climate Protection) Amendment Bill be now read a first time. It is particularly timely that this bill has its first reading today, as after 2 days the largest international conference on climate change that New Zealand has ever seen ends today at Te Papa in Wellington. The conference comprises some 400 people with a whole raft of prestigious international speakers, and we have heard over and over again from those at the conference that the science of climate change is no longer in doubt. At least, there is no longer debate about whether climate change is happening, about whether it is serious and urgent, and about whether it is humans who are causing it. The debate now is about how fast it is going and how much time we have to turn it round. The climate doubters have essentially been silenced, and we need to move together as humanity to take some action.
We have heard about the much faster than predicted melting of the polar ice caps. We have heard about the faster warming of the ocean. We have heard that the ocean is getting more acidic, and that that is attacking the ability of organisms at the base of the marine food chain to form calcium carbonate for their shells. We have heard about the slowing of the Gulf Stream that keeps Western Europe habitable and prevents it from freezing over. We have heard about the loss of biodiversity that will occur as climates warm and species have nowhere else to go. This is the most serious matter facing humanity at the moment.
We have also heard speaker after speaker, including the Rt Hon Simon Upton, who used to be Minister for the Environment, say that a carbon charge would be the simplest, the most effective, and the fairest way of putting a price signal on carbon in order to change behaviour. But we are not going to have a carbon tax in the near future.
Therefore, I am bringing forward this very simple amendment to the Resource Management Act. It repeals a 2004 amendment that took away the power of regional councils to consider the effects of an activity on climate change when granting consents or setting rules in plans. The reason at the time was that a carbon charge was proposed as the centrepiece of the Government’s 2002 climate change package to control carbon emissions at a national level. Everyone agreed at the time that having a national economic instrument was the best way to do that, and therefore the select committee agreed with those changes.
A carbon charge would have set a price for carbon across the whole economy. It would have made energy efficiency and renewable energy more cost-effective, and it would have provided a disincentive to burn fossil fuels and to use energy inefficiently when there were alternatives. It would have encouraged wind, it would have encouraged wood and other forms of biomass, and it would have encouraged insulation of homes, solar water heating, and all the rest.
However, in December the proposal for a carbon tax was abandoned. The effect is that we now have a policy vacuum, so there is nowhere the climate-changing effects of burning fossil fuels in a new power station, for example, can be considered. It is very difficult now to consider carbon emissions from a new coal or gas-burning plant, at all. That is a gaping hole in climate policy, and it must be filled.
I chaired the Local Government and Environment Committee when it considered the amendment bill in 2003 and 2004. I strongly supported the fact that the bill inserted into section 7 of the principal Act, as matters to which decision makers had to have particular regard, the benefits to be derived from the use and development of renewable energy. That was the primary purpose of the amendment, and I supported it. So I will now be referring this bill to the Local Government and Environment Committee again, although I am no longer a member of that committee, to consider—given that we have no carbon charge—whether that decision should be reversed.
I had concern at the time that the removal of the powers of regional councils should be linked to the coming into force of the carbon charge itself. I could see, even then, that there were a number of situations in which the carbon charge might never happen. One situation would have been if the Kyoto Protocol had not been ratified. At that stage we were still waiting to see whether Russia would ratify, and without Russia we were not going to have a treaty. Another situation would have been that Labour might not have won the election, in which case we were told that the carbon charge policy would be reversed. The third one, which I did not think about much at the time, was that Labour itself might change its decision to have a carbon charge—and that of course is what happened.
I was sufficiently concerned about that in the Committee stage to move an amendment to clause 2, that new sections 70A and 104E should come into force on the day that a national carbon charge, carbon-trading regime, or national environmental standard to control the discharge of greenhouse gases came into force. That amendment was defeated in the Committee.
Unlike most amendments to the Resource Management Act, we know exactly what the effects of this amendment will be, because it will simply take us back to the way the Act was before 2004, and we have had a few examples of what happens in practice. In 1993 there was an application for a Taranaki combined-cycle power plant, which would burn natural gas and produce considerable greenhouse gas emissions. The Rt Hon Simon Upton, the Minister for the Environment at the time, used his call-in powers under the Resource Management Act and called in the proposal. The application was heard by a board of inquiry, which imposed carbon mitigation obligations on that plant. It was a very complex formula and the trigger for the formula was never met, but the intention of the conditions was that the owners of that plant would have to plant trees to absorb the carbon the plant emitted. That was one effect of the Resource Management Act as it stood at that time. In 2001 Genesis Power was granted consent for a new Huntly combined-cycle, gas-fired power station on the same site as its current coal-fired power station, which is old, on the condition—and this was the result of submissions made at the time—that carbon dioxide emissions from the old and new stations combined did not exceed a certain level. That meant, effectively, that the new station had, to some extent, to back out an older, less efficient, and dirtier station.
It is probable that neither of those requirements for mitigation of greenhouse gas emissions would be legally possible as the Act stands today. That was tested last year with Mighty River Power’s application to convert the Marsden B old oil-fired plant—which has never run—to coal. Marsden B is a 20-year-old station. It is ancient technology, and the very best efficiency it can achieve when converted to coal is 34 percent efficiency. That is a very high level of greenhouse gas emissions for every unit of electricity generated, and submitters argued both the high carbon emissions and the effect on climate change in their submissions. But section 104E in the Act, as it stands now, states: “When considering an application … a consent authority must not have regard to the effects of such a discharge on climate change, except to the extent that the use and development of renewable energy enables a reduction in the discharge into air of greenhouse gases, …”—whatever that means.
So the 2004 amendment Act prevented the council from having regard to the effects of greenhouse gas discharges on climate change, except to the extent that the use and development of renewable energy would enable a reduction in the discharge of greenhouse gases. The focus on renewable energy is still there, but it is clear now that section 104E and also—for rules and plans—section 70A are too restrictive in light of the decision to drop the carbon charge.
Hon Dr NICK SMITH (National—Nelson): In the House this afternoon I want to recite the little ditty “ten green bottles, whenever they shall fall” to illustrate just how shambolic this Government’s climate change policies are. Environmentalists say it is a mess, business says it is a mess, and even Government-friendly commentators like Rod Oram say it is a mess. This week we even had Dr Kevin Patterson, a senior Government official, resigning because it is such a mess. National was tempted to support the bill because Parliament probably will have to clean up the Government’s mess, but the bill actually goes in exactly the wrong direction. Tony Blair, who was in New Zealand today, has said—quite rightly—that climate change requires a global response because it is a global issue. Yet this bill says we will make councils responsible individually for this huge issue of global change.
I want to illustrate the nonsense of the Government’s policies. People will recall that back in June 2003 the Government announced an animal emissions levy—my green bottle No. 1. It did not last 4 months. The Government was going to charge 72c for every cow, but that little green bottle did happily fall.
Then we had the Minister responsible for Climate Change Issues saying we should not worry, because $500 million of carbon credits was available to us if we went ahead and ratified the Kyoto Protocol. Well, we all know that that little green bottle went crashing into the deck.
Then the Government announced with great proclamation its energy efficiency target. It said that within a period of 10 years there would be a 20 percent improvement in energy efficiency. It also acknowledged that, without doing anything at all, it expected improvement of between 0.5 percent and 1 percent per year. Well, we are 5 years down the road and, as the select committee found out, it has not made an iota of difference. We have seen only a 2 percent improvement in 5 years, which is less than what the Government said we would have if nothing occurred at all, and the Government has abandoned its Energy Efficiency and Conservation Strategy of 20 percent over 10 years.
Then we had the Government’s bold renewable energy target. The Government said that under its climate change policy it would get 30 petajoules of extra renewable energy over 10 years. It also said we would get 1.5 petajoules per year by doing nothing. We are halfway down the track—and how much do we have? We have 4 petajoules, out of the 30 promised—which is less than what was to be achieved by doing business as usual—and the Government has managed to abandon that little green bottle, as well. It has gone down the tube.
Then we had the big daddy—the carbon tax. The Government announced 3 years ago that the linchpin of its climate change policy would be a carbon tax. Well, we all know that went up in a ball of flames, as well. That was No. 5 bottle down the tube.
Then we had the policy to get rid of emissions from big industrial producers. We had the negotiated greenhouse agreements, where the Government would sit down and talk with big industry players. But, of course, that policy was totally predicated on the carbon tax. Why would any industry negotiate a greenhouse agreement if it were not for the fact of a carbon tax? In fact, those that have signed the greenhouse agreements are now saying they want an out, because the Government has abandoned the carbon tax. So our sixth little green bottle, on negotiated greenhouse agreements, has gone down the tube.
Then we have the projects for reducing emissions, where the Government has tendered surplus credits so that we can encourage reduced emissions. But that policy too has had to be abandoned, because there are no surplus emissions to tender. So bottle No. 7 is down the tube.
Then we had the overall target. The Government said its overall policy goal in 2002 was that we would stabilise emissions by 2012, yet the Minister said in the House yesterday that that was quite unachievable in the overall policy goal. There is another little green bottle down the tube.
Then we have the 10 percent forestry cap. The Government said it would stop 10 percent of deforestation, which was a substantive part of the climate change argument. Now it has accepted that that goal has turned to pickle and it has abandoned its 10 percent forestry cap. Little green bottle No. 9 falls over.
Then we have this bill, and this bill is truly remarkable. The Government introduced and passed legislation only 2 years ago to take climate change out of the Resource Management Act, and today it is voting for a bill to put it back in again. So bottle No. 10 falls over. What is so hideous is how the Government can expect there to be any credibility for its climate change policies when it introduces and passes legislation to remove climate change policy from the Resource Management Act and, 2 years later, votes for a bill to put it back in. Is it any wonder that every commentator across the board, environmental and economic, at the conference being held less than a kilometre away is saying the Government’s policies are a mess? We on this side of the House do take climate change seriously. The Government has made a farce of that policy and it is a mess.
Sitting suspended from 6 p.m. to 7.30 p.m.
Hon DAVID BENSON-POPE (Minister for the Environment): Most members of this House accept that climate change is a serious threat to the future of this planet. Obviously, after the discussions at question time today, I would want to except Dr Brash from that generalisation. But I think we would all acknowledge that what changes we will face in our future daily lives, and how they occur, are at this point unknown. This Government is no different from any other Government in its effort to tackle greenhouse gas emissions in as many effective ways as possible. It is a huge pity that the National Party of today does not show the leadership Simon Upton displayed around these vital issues in the 1990s. I also note that the discussions we are having here right now are the inevitable consequence of this Parliament failing to support a carbon charging regime.
As Minister for the Environment responsible for the Resource Management Act, it is my belief that this Government and local bodies acting under that Act play a key role in effecting useful change in this country. We would all acknowledge that climate change is a very complex issue, and I fully acknowledge, alongside the Green Party’s co-leader Jeanette Fitzsimons, that the roles and responsibilities given to councils can be instrumental in how we might seek to reverse the greenhouse effect. In 2004 the Government amended the Resource Management Act to ensure that greenhouse gas emissions were to be managed at a local level. That amendment removed the ability of regional councils to consider climate change effects from point sources. Then, however, there was to have been a carbon tax. As Ms Fitzsimons recently stated, this fundamental change has promoted this amendment bill, and I quote her words: “Now that the proposed carbon charge has been cancelled, it is essential to pass this bill and restore the power of local government to control pollution.”
Members of this House may be aware that the Resource Management Act already contains express provision to manage greenhouse gases. When the Government made the amendments in 2004, national environmental standards were seen as a way of dealing with greenhouse gases, and the standard for landfill gases is an example of how those standards have since been applied. However, I acknowledge that a national environmental standard of this nature would require a gestation period of some time for development. In the meantime, a number of applications could be made for greenhouse discharges, which, as Ms Fitzsimons has noted, include the likes of coal-fired power stations at Marsden Point that gain consent with there being no ability to consider effects on climate change.
As Minister for the Environment I support the continuation of the policy that provides for local authorities to play a role in decisions about this area. Nevertheless, the question for the House surrounding this issue is whether this is achieved best through a national approach or—as this bill seeks to do—by regional councils considering the effects of climate change on a case by case basis. A consistent approach as to how one regional council might set limits compared with another elsewhere in the country is, I believe, fundamental to a fair and equitable economy.
The effect of this bill will allow regional councils to consider climate change impacts when determining discharge consents in their own regions, irrespective of whether a national environmental standard has been made, and it may still be necessary that a national approach to limits is called for if disparities between regions were, in that event, to occur. This Government has recently embarked on a scoping exercise of this nature with a number of infrastructure-related topics, alongside the changes made to the Resource Management Act last year. A national approach that delivers consistency throughout the country is central to this work. I believe that the select committee will need to be mindful of the need to ensure that national consistency will occur in order to give our economic drivers some cognisance.
One thing is clear: the existing policy reflected in the Resource Management Act supports the role of local authorities, and also the role of the Government, in influencing people’s actions directly and indirectly. The Greens’ co-leader’s view that the power of local government to control pollution is one important step towards reversing climate change can be taken further. For example, how carelessly we use our private cars on our road networks within the design of our cities is just as important. At this point we do not know whether any form of carbon charge will influence how business works and how things we take for granted will change. We do not yet know what a national energy strategy may state; these matters are yet to be debated and implemented.
New Zealand’s contribution to climate change, while small in comparison with international standards, in no way absolves us of our international responsibility. This Government and the role of regional councils can have a major impact on these emissions. The policy behind this bill is not a significant shift from how the Act currently operates. The devolved system of governance in the resource consent process is an effective way of influencing actions that directly mitigate the effects of climate change, and the challenge facing councils in achieving this in a consistent manner will be ongoing.
Mr Deputy Speaker and members of the House, the Government is supportive of any effort to tackle greenhouse gas emissions in as many effective ways as possible. In summary, we support this member’s bill going to the select committee. I look forward to the outcome of that select committee process on what is a most complex but very urgent issue.
R DOUG WOOLERTON (NZ First): Unfortunately, New Zealand First members will not be able to support this member’s bill, and it is not because we are unaware of the concerns relating to climate change, or any of those sorts of things. We are looking at bill after bill, waiting for a solution to come to the fore. New Zealand First members have said on a number of occasions that we favour a regime within this country. We do not favour a carbon tax or carbon credits going to other countries. We do not think those measures would be good for our country. We share the view held by America and Australia, which is that not joining an international regime does not mean we cannot do something about climate change or carbon emissions in our own country. So, unfortunately, we will not be able to support the bill.
We have always said that New Zealand should not have signed the Kyoto Protocol ahead of its trading partners, because that puts New Zealanders at a disadvantage in the international markets—and that is unfortunate and sad. Jeanette Fitzsimons, a lady whom I admire immensely, has said that even Simon Upton was in favour of a carbon tax. I was Simon Upton’s electorate chairman for a number of years and know the man rather well. I admire his brain and his ideas, but I do not—and even Simon would know this—admire his practical application of those ideas. I think this is the problem surrounding climate change; we have not as yet come to a workable solution.
I for one am not alarmed by the number of tries Governments have had. I think there will be many more experiments, shall we say—I just hope they are not expensive—before we actually come to a solution that will make a difference internationally and that New Zealanders can latch on to, and say: “Yes, that is a sensible solution. We will sign up to that. We will obey the laws that are put in place surrounding that, and we will put our hearts and souls behind it.” That has not become apparent at this point and, as I said, we are looking forward to the day when that happens.
Unfortunately, Mr Deputy Speaker, you and I both know that humanity has a habit of going to the edge of the cliff before it looks at other solutions. So it is with fossil fuels and all those sorts of things. I believe that the technology is out there now but that it will not be implemented until the cheaper options of fossil fuels have either run out or the day they become too expensive in the market naturally arrives. I do not believe that we should be making them falsely expensive by putting on taxes—in this case carbon taxes—or whatever else.
I cannot sit down without mentioning that we do not think it is a good idea to palm off tricky situations from central government into the hands of local government, and we see an element of that in this bill. We do not think that is fair or right, and if a solution is to be found, let it be found here in Parliament, where everybody is represented. Let us not palm it off to local bodies so that they have to pick up the responsibility for something we have shied away from.
TE URUROA FLAVELL (Māori Party—Waiariki): Tēnā tātou katoa i te Whare. References to our physical world—our environment—are made in speeches on our marae throughout the country every day. For example, we say: e haunui ana i raro, e hari ana i runga, it is blowing below, but the sky above is clear; and e hoki ki tō maunga kia purea ai koe e ngā hau a Tawhirimatea, return to your mountain to be cleansed by the winds of Tawhirimatea.
The Māori Party is pleased that the Resource Management (Climate Protection) Amendment Bill is having its first reading in the House today, for it is one bill that, again, forces this Parliament to really come to terms with global concerns. It is an issue that tangata whenua can provide significant expertise in, given our intimate association with the world around us. Traditional Māori knowledge of weather and climate, and of associated activities such as gardening and fishing, guide us on how we understand climate variations. In the days of our tūpuna the scarcity of food resources brought about by environmental factors such as major climate changes meant that they had to define greater areas of land for crop growing. Changes in tangata whenua practices and customs that interact strongly with the climate are a key to future planning. We must build on this knowledge at both central government and local government levels if we are to act responsibly to protect and nurture Papatūanuku as she provides protection, stability, and security through whenua; tūrangawaewae for her offspring.
This bill reinstates the ability of local government to consider the effect of greenhouse gas emissions on climate change when considering applications for air discharge consents. The Māori Party asks who better to ask about weather than the local weather watchers. The National Climate Centre in the National Institute of Water and Atmospheric Research has just completed a pilot programme that describes the expertise of local Māori weather watchers. The project describes the local environment knowledge of the weather and climates of two tribal areas, Ngāti Pare in the Coromondel, and Te Whānau-a-Apanui in my electorate in the Eastern Bay of Plenty. According to the research there are three key strands to the knowledge: the naming and classification of local weather and climate phenomena, the oral recording of weather and climate-based events and trends, and the use of environmental indicators to forecast weather and climate.
The first strand is a fascinating area—one can learn about all of the different understandings tangata whenua have developed about climatic features. Given that the sky is a little bit grey today, let us look at rain. We have ua kōwhai, spring showers; pūroro, hard-driving rain; āwhā, severe rain; ua, light rain; kohukohutere, light misty rain; and tōmairangi, dewdrop rain, to name but a few. Our people used extensive knowledge of the local climate, the wind direction, the rainfall patterns, and the seasonal patterns to help them make decisions about the timing, safety, and viability of their activities.
We are happy to support this bill through to the select committee as we believe tackling climate change requires action at all levels. We call on this House to honour the history and expertise of tangata whenua in developing strategies to achieve change. There must be active engagement with mana whenua in decision making in their rohe, and we hope that the submissions will provide clarity on this and on the ways in which the Resource Management Act can be strengthened to ensure effective representation. We all need to look critically at climate change and generate solutions that are determined by the people. Most global warming over the last 150 years is attributable to human activity—not UFOs or supernatural occurrences, but real, live people. Accordingly, real, live people will protect us with the answers.
Government should initiate proactive research strategies to achieve vehicle fuel efficiency and reduce vehicle emissions. At the local government level we can achieve change through transport and land use planning in order to encourage reduced emissions from motor vehicles. The Māori Party is committed to assisting whānau and hapū, as tangata tiaki, to take whatever measures are necessary to ensure the well-being and future good health of the environment. We need to take action on all fronts—the Kyoto Protocol, carbon tax, and in our homes. To set the record straight, I say that the Government failed to formally approach the Māori Party before cancelling out on the discussion around carbon tax. We need to note that in this House today.
The climate change will impact on Māori in diverse ways. The resources most vulnerable to future climate change are likely to include coastal areas, land in eastern areas already prone to drought, some Māori lands, and indigenous species. The point of all of this is that tangata whenua can be part of the planning for the climate change, using our experiences and knowledge that we have gained through periods of time and over the generations.
GORDON COPELAND (United Future): I begin by congratulating Jeanette Fitzsimons on being successful in the ballot. It is always a buzz when one’s bill is drawn, particularly in this new MMP environment where a bill coming out of the ballot has the very real possibility of becoming the law of the land, if we get the various alliances right under our MMP system. It is an example of MMP at work, if one likes, and it is a great environment to be in.
I guess I have looked at this bill from the big picture point of view, rather than getting down to the minutiae. After all, this is a first reading, and it is good to look at the big picture. The first question I have asked myself is whether the Resource Management Act as it stands is rather too restrictive, or not restrictive enough. Quite clearly, in my view, the answer has to be that it is presently too restrictive. When the House was debating the previous amendment to the Resource Management Act in 2005 I remember the Hon David Benson-Pope saying that it represented a work in progress and that the Government would be prepared to revisit it as various problems emerged.
Looking at that big picture, I have to say that I believe the Act is still too restrictive. That view is reinforced by the fact that I recently had to obtain a resource consent here in Wellington to build a fence of 5.25 metres on my boundary. The resource application was as if I was building a block of flats. I had to pay 540 bucks upfront and so far my fence is only half built. One of the things that we are therefore being overprescriptive about is not giving enough scope in the Resource Management Act for people to apply common sense. Without going into details, members should believe me when I say that anyone who had come along and looked at it could have made the decision in 5 seconds that it was fine in terms of the Resource Management Act. I mean, I could have paid the city council $80 to look at what I wanted to do, and where, and it would have found it was fine. But we are stuck with this very, very tightly regulated regime.
Other members of my family have had similar experiences, as have my friends. There are literally thousands and thousands of Kiwis who have had experiences with the Resource Management Act and found the process far, far too prescriptive and sort of nanny State. There needs to be a bit more room for common sense.
The second problem I see and I think it is quite a serious problem for New Zealanders, is that we are increasingly becoming risk-averse. We are trying to create some sort of idealised society where nobody takes any risks any longer. My worry is that if we keep going down that track, eventually we will smother and even extinguish that get-up-and-go, can-do, entrepreneurial, number eight wire creative spirit, which is the very thing that made our nation great in the first place.
I could give many, many examples. However, I shall take members through one example related to coastal permits. It is possible that the bill may result in a local authority denying somebody the right to build, say, a bach on a coastal section on the basis that, as a result of climate change in a few years’ time, part of that section might be washed away. Let us say it could be in 15 years’ time, or an indefinite period; no one could say exactly when it would be. In one sense that seems reasonable, so let us not allow a person to build there. However, it is possible that the individual may say: “But actually if I get 15 years of fantastic holidays with my family in this bach, that’s a risk I’m prepared to take.” I think we should let people make those kinds of decisions, without becoming too prescriptive.
United Future will support the first reading and referral to the select committee. I say to the people of New Zealand: “Please come along to the committee and have your say.” We need to hear those views, and that is why New Zealand First will support the bill going to the select committee. But I signal that our support cannot be guaranteed beyond that stage. We will carefully follow the process in the committee and when that is complete we will decide about our future support of the bill.
METIRIA TUREI (Green): I think it is important to point out, before I begin my speech proper, that this bill is not about building fences. It is not about coastal permits. It is not even about the Resource Management Act so much. This bill is simply about provision for air discharge consents. Frankly, one does not need an air charge consent when one decides to build a bach on the coast. But we appreciate the support from members in the House and from United Future.
The science is unequivocal; carbon dioxide levels in the atmosphere are higher now than they have been in the last 650,000 years. The West Antarctic ice sheet is breaking up at an unprecedented rate. The Gulf Stream—the warm current that maintains the climate of Western Europe—has weakened by 30 percent. The gradual melting of the tundra in Siberia and Canada has started to release thawed methane from the swamps. Human activity in the last 200 years will render our planet much more hostile for our whānau in the next 200 years. We can protect our children and their children if we simply choose to take action now.
There are always those who choose to run from a problem rather than face it, and the consequences are usually limited. But when political parties, and even Governments, do this, the impacts are major and affect not only the people of a nation, but the very future of that nation. Even Mr Blair thinks so. I was very disappointed to hear Nick Smith’s contribution to this debate. He simply reiterated a litany of complaints and offered not one single solution, idea, or option for what we might do in the future. I certainly hope that he looks at the Green Party document and position, and really works with other parties and with us to find better solutions to these problems.
National would be very wise to take to heart the comments of its former member and Minister, Simon Upton, who said during the Climate Change and Business Conference that a carbon tax would be the most effective tool to reduce greenhouse gases, and that all parties should review their rejection of it. Despite being a blunt tool—I am happy to accept that—the carbon tax was at least a well-thought-through measure to deal with this international crisis.
This bill today is another carefully thought through, practical measure that is absolutely necessary in our country. It is a good example of how small changes can have long-term, significant, positive effects. This bill gives local communities a little more opportunity to address climate change and greenhouse gas emissions at a local level. It puts solutions in the hands of the communities. This is critical, because the only means to protect our country from the impacts of climate change is for us to establish a structural framework that encourages local communities and individuals to take personal responsibility and take personal action immediately.
My co-leader, Jeanette Fitzsimons, has set out in detail the nature of the bill and how it will be so effective for this country. I just want to briefly discuss the Green Party document Turn Down the Heat, where we have set out over 60 separate practical measures to enable community and individual responsibility. For example, if we could introduce a “feebate” system that would link registration price to fuel efficiency in cars, people would be incentivised to purchase more fuel-efficient cars where they can. If more money was allocated to quality and timely public transport, people would not need to use their cars every day and would be able to choose sensible cost-effective alternatives.
Domestic electricity demand is rocketing in this country. The adoption of time-of-use electricity metering and smart metering would mean that citizens could better facilitate the management of their domestic energy use, helping to reduce energy demand. If we could build economies of scale to increase the affordability of solar water heating by using the Government’s ability to bulk tender, people could install solar water heating units, reducing both their electricity bills and energy demand as well. If the building code review could be sped up a little, we would enable better house insulation, damp-proofing, and efficient heating for our people today. We could upgrade the efficiency of street lighting to show and demonstrate local government’s commitment to these changes.
All of these things can be done right now. They do not need investment. They do not need research and development. They do not need more reports. They just need action. This Parliament and Government can take action and put those measures in place now. This bill will be a significant step for our country. I urge the House to support it.
Dr PAUL HUTCHISON (National—Port Waikato): I note the Greens were talking about how they just need action. What they do not need is chaotic action. In opposing Jeanette Fitzsimons’ bill I wish to make it crystal clear that the National Party takes climate change extremely seriously. The National Party, however, is absolutely of the view that the legislative framework around climate change should be evidence-based, should be nationally consistent, and should be relevant to global efforts to diminish the anthropogenic changes that have occurred with our climate over the last few hundred years.
Sadly, the Greens and Ms Fitzsimons live in an unrealistic fantasy world. This bill is the very sort of legislation that will make the legislative framework around climate change in New Zealand, which the Government has put in place, even more chaotic and more of a shambles than it has already proven to be. This bill is fundamentally inconsistent with achieving meaningful, nationally consistent measures in greenhouse emissions, nor does it have any requirement that measures taken are evidence-based. I hope Ms Fitzsimons takes note of that.
In 2004 the Labour Government removed the abilities of local governments to consider the effect of carbon dioxide emissions and other greenhouse gases on climate change, when making rules or regional plans or determining air discharge consents. The rationale was that it would be dealt with at the national level. One of the obvious reasons that it was inappropriate for local governments—of which we have about 79, or certainly over 70, in this country—to be given the powers to approve carbon dioxide emissions was that they simply do not have the resources to be able to make meaningful changes, which are evidence-based, to this extremely complex question of climate change. I challenge Ms Fitzsimons to name any local governments in New Zealand that really do have the resources to bring out meaningful, local body changes that are going to have a global effect and are consistent with what New Zealanders, as a whole, do.
The problem with the prescription of this bill is that local governments, and there are over 70 of them around New Zealand, are going to be doing all sorts of different things, and that is entirely unrealistic. I think of my own electorate, Port Waikato. I do not think it is fair that the Franklin District Council should be expected to make rules regarding New Zealand Steel, which is a major employer with over 10,000 jobs. That organisation is also a major energy emitter, but it has been proactive in diminishing greenhouse gases and has used world’s best-practice to bring about meaningful changes to its energy emissions. I also think it is hugely unfair on any local district council, like Franklin, for instance, to make rules about glasshouses. That industry is burgeoning and uses carbon dioxide but it is hugely important for the local economy.
The Labour Government has proved its inability to manage climate change and Minister Hodgson has presided, undoubtedly, over the biggest fiscal mistake in New Zealand’s history—the billion-dollar mistake. It is highly relevant that Dr Kevin Patterson, a senior scientist in the Ministry of Economic Development, has spoken about this Labour Government’s chaotic policy in climate change and science.
This bill from Jeanette Fitzsimons and the Greens will only add to the legislative chaos the Labour Government has laid down around climate change. It is absolutely inappropriate for this House to send the bill to the select committee. We need nationally consistent, evidence-based policies that are relevant to a global effort to diminish the anthropogenic emissions that have occurred over the last 100 years.
STEVE CHADWICK (Labour—Rotorua): It is entirely appropriate that we are debating Jeanette Fitzsimons’ Resource Management (Climate Protection) Amendment Bill during the week of the climate change conference. We certainly need more debate on the issues of climate change. The Local Government and Environment Committee had a briefing last week. It illustrated absolutely empirically that change is real and evident now. We all understood at the select committee that climate change is real and upon us. We looked at the emissions that are evident in our country now and having a very real impact by causing floods and other changes. Of our total emissions, our agricultural emissions make up over 49 percent, transport 18 percent, and industry 5.3 percent. We cannot ignore those gross emitters—we must do something about them.
We sit in quite an interesting state of being 55th in the world for total greenhouse gas emissions. It is not such a good place to be, but it is nothing like the big three: the United States, China, and Europe. We have to play our part, and I think New Zealand does so. I take exception to the comments of the member opposite who said we have made a giant mistake. In fact, some international experts have acknowledged the work of Minister Pete Hodgson on the international stage, so when we are negotiating international instruments we can hold our heads really high. There will be a review of the Kyoto Protocol in May of this year in Bonn.
Climate change is a very serious challenge. To have a domestic focus is not easy, and I agree that it has to be nationally consistent. We learnt there is no one single solution. We need a really broad and balanced approach to how we manage climate change, and whatever mechanism we come up with, and we will hear more about that after May of this year, has to be effective, economically and technologically feasible—and that involves science providing new solutions—fair and equitable, and cost-efficient. So we need to make progress on significant greenhouse gas reductions, and we are aiming to be on a downward path by 2012.
I congratulate Jeanette Fitzsimons on the bill. We need to be doing everything possible to look at how we achieve that downward trend by 2012. We also need to look at some different approaches—it is a dynamic process. The Minister announced that there will be a review. Several work programmes are under review at the moment, and those papers will be in Cabinet by June of this year. The review will involve all sectors: energy, forestry, transport, the carbon market—and which mechanisms we use for trading on the carbon market—and agriculture. We cannot sit here and do nothing, and I applaud the fact that Ms Fitzsimons has brought a bill to the House. It may not be perfect, but I really do support it going to the select committee.
We have to look at our revised position on climate change, and it is yet to be announced. But the question that arises from the bill concerns whether we do so through a national approach, as a member opposite, Dr Paul Hutchison, said—which we are attempting to do with the National Environmental Standards for Air Quality and the National Energy Strategy—or whether we allow regional councils to do so through Resource Management Act mechanisms. I think that is what we will learn when we hear submissions on the bill. I look forward to that, and I hope the bill comes to the Local Government and Environment Committee.
ERIC ROY (National—Invercargill): There is room for one more speech on the Resource Management (Climate Protection) Amendment Bill, and I would certainly like to make a few comments. I think it does not matter who is speaking about climate change or in what forum: one needs to know what that person’s attitude is to climate change. Am I worried about climate change? No, I am not; I am absolutely terrified by it. That is my position. If we understand the absolute fragility of the atmospheric balance, and the nature of ocean currents and what is actually happening in the combustion of fossil fuels, I am terrified. That is my position. However, I am opposed to this bill, which is why I take this call. I want to clarify that stance.
This bill will not fix the problem. There is what I call the delusion and the danger of the placebo. We tell ourselves we are doing things that will fix the problem, but in actual fact they will not, and perhaps we are doing them to score brownie points internationally. I believe that Jeanette Fitzsimons is sincere and is trying to do what she can in the absence of a national and an international strategy that works. She is saying: “Let’s start here.”, but I say that that argument is fraught with mistakes.
I say the bill will not work for this reason. Let us look at the kind of effort that is going into the Kyoto Protocol at the moment. Category 1 countries are the only ones talking about doing something—and they are falling like flies—and the rest of the world, which has the greatest potential to increase greenhouse gas emissions, is not captured even by the desire to be at the table talking about the situation let alone the desire to do anything. So we have a mishmash internationally, and this bill does the same sort of thing locally.
This bill sets up a variance between regions in New Zealand and all the different local authorities. I believe this move will have the converse effect to what is intended. Rather than shifting the focus on to actually doing something, the bill provides a mechanism for local authorities to exercise a discretion to opt out. I take, for example, my own local province. A bit of climate change would be quite helpful in Southland. It may well be that the local authority in a province like Southland, sitting on 4 billion tonnes of lignite, may set new standards. The local authority may say that it does not believe in this stuff, and that it will go ahead, develop its resource, and build an economic powerhouse in Southland. Southland already has the smelter, which is 15 percent of New Zealand’s greenhouse gas emissions, so it could add to that. The local authority could set up some power stations, create some liquid fuel, generate some power, and smelt silicone—and this bill is the very bill that allows that to happen because it shifts that discretion on to local authorities.
I am not saying Southland will do that; I am using it as an example. But there will be some local authorities that might promote that alternative should this bill be passed. So I believe this bill will have the converse effect to what is intended. Of the 70-plus local authorities in New Zealand, there will be some who say: “Let’s give this a go. This is our opportunity. This is our out.” That matter concerns me seriously.
If we are to deal with this problem, it should not be with a placebo. We have to buy into a range of effects that will actually change the outcomes. Even if we buy into the category 1 stuff in the Kyoto Protocol, we are moving the same result out only about 6 percent. We have to buy into serious investment in technology. We must change the way that we think—a paradigm shift.
Fiddling around and creating a whole lot of complexities within the Resource Management Act, which does not deliver consistency now, will either stop investment because people do not understand—Whangamata revisited—or it will provide an opportunity for a local authority to thumb its nose and say: “Let’s build a resource for economic gain, and the moral issue may not be considered.” National will be voting against this bill.
JEANETTE FITZSIMONS (Co-Leader—Green): I thank colleagues who have indicated their support for the Resource Management (Climate Protection) Amendment Bill, and I am glad that we will have the opportunity to debate it in the Local Government and Environment Committee. I acknowledge the comments of my colleague Te Ururoa Flavell. They recalled for me the very first climate change conference I ever went to, which was held in the late 1980s in the Waikato. I recall an amazing speech by a kuia from Hauraki, Betty Williams, who has since become a good friend of mine. She said very simply: “The atmosphere is a taonga. The climate is a taonga. They have been damaged, and in Māoridom we have a mechanism for addressing that damage. It is called rāhui tapu. We have to put a rāhui on the burning of fossil fuels, because the atmosphere has then got the capacity to recover and to heal itself.” I thought: “Yes, that is what we are trying to say, too, when we talk about curbing climate emissions.”
To the National Party I say that the legislative chaos that I am supposedly putting in place here is precisely the same legislative chaos—word for word—that the National Government introduced when it brought in the Resource Management Act in 1991. I am restoring exactly the wording of the Act as it was before 2004. I say to Dr Paul Hutchison that the Franklin District Council does not issue air discharge consents, so it will not be obliged to consider the provisions of this bill. Environment Waikato does issue air discharge consents, and before 2004 it had shown itself to be entirely capable of putting good conditions on the Huntly gas-fired station to make it mitigate its greenhouse gas emissions.
I welcome the fact that Eric Roy has understood the seriousness of this issue and is as panicked about it and the future as I am—and good on him for that. But I say to him that the Southland Regional Council can already decide to promote coal burning in order to warm its climate. There is nothing in the present legislation to stop that. What the council is prevented from doing at present is considering the climate change impacts, at all. So I do not think that argument stands, either.
Minister David Benson-Pope has outlined the main problem with this approach, which is that there can be inconsistency between councils across the country. He said that a national environmental standard would be better. Yes, it would! I tell the Minister to bring it on, and when he does we will withdraw the bill. The fact is that this House has no alternative now. There is no carbon charge. There is no carbon trading. There is no national environment standard. The only thing we can do is restore some control at local level until we have a national economic standard.
Passing this bill makes possible again some local control over climate emissions. We have no time to lose, because new, coal-fired power stations are being proposed in several places in the country—precisely, I believe, because there are now no controls over their emissions. At the conference today, it was stated very clearly that the investment decisions we make between 2005 and 2010 will determine the climate impacts in 2030. We have only a very few years to get our investment decisions right, or we will stuff up the climate for our children. We need to take that seriously. Nobody is suggesting that this bill can fix the problem. The idea that a member’s bill could fix global climate change is clearly absurd. It is one small step towards putting back some controls that used to be there.
I finish by quoting again from the conference today. One speaker said: “We are treating the earth as a business in liquidation, because it is not on anyone’s balance sheet.” That statement was not made by an environmental activist, a scientist, or a politician; it was made by IAG, which is one of the big reinsurance companies of the world. It is panicked about climate change—as are a few of us in this Chamber—because of what it is doing to its business. Let us not treat the Earth as a business in liquidation.
A party vote was called for on the question, That the Resource Management (Climate Protection) Amendment Bill be now read a first time.
Ayes 64
New Zealand Labour 50; Green Party 6; Māori Party 4; United Future 3; Progressive 1.
Noes 55
New Zealand National 48; New Zealand First 7.
Bill read a first time.
Bill referred to the Local Government and Environment Committee.
Bills
Young Offenders (Serious Crimes) Bill
First Reading
RON MARK (NZ First): I move, That the Young Offenders (Serious Crimes) Bill be now read a first time. At the appropriate time, I intend to move that the bill be considered by the Law and Order Committee. The purpose of this bill is to address serious crimes being committed by young offenders and to provide a deterrent to younger people becoming involved in serious crime, which inevitably and almost certainly results in their becoming adult criminals and moving on to populate our corrections facilities.
Young offenders, and in some cases only children, have been responsible for a recent spate of very serious and shocking crimes. That was included in the explanatory note of the bill when it was written 4 years ago. The tragedy is that, 4 years on from then, the situation has got worse. There is also a clear perception amongst New Zealanders that the youth justice system is too lenient towards such offenders, and that the system we have in place is simply not working. Beyond a certain point, I believe that society has a responsibility to take control of the situation and to enact measures and procedures that deter young people from such acts. We believe that at a certain point—regardless of other circumstances, and regardless of the situations that may have contributed to or are contributing to that young person’s life and the way in which they are offending—society must draw a line and say: “Beyond here, you go no further.”
Justice now requires that a different balance be struck in respect of serious offending by young persons. This bill proposes that young offenders who commit serious crimes should be accountable for their crimes in more or less the same way adult offenders are. New Zealand First has long advocated a review of the youth justice system. Part of our policy, promulgated in election manifesto after election manifesto, is designed to improve the youth justice system. Our position incorporates a longstanding policy to reduce the age of criminal responsibility.
Another part of New Zealand First’s law and order policy in the area of youth justice is the implementation of a “three strikes and you’re out” policy. Most New Zealanders do understand that after the third warning that is their lot. We need to enshrine this principal in law and use it to enable us to guide and mentor young people who are at risk.
Both these policies are dealt with in this bill. By supporting this bill to the select committee other political parties can see these policies enacted in law. Having this bill brought before the select committee will—more important—give the New Zealand public and those charged with the responsibility for administering the youth justice system an opportunity to discuss this issue, to air openly, once and for all, the problems they encounter and give us a chance to improve the law to help them administer the system. More important, it will give us a chance to save the lives and the futures of hundreds of at-risk young children.
I would like to address a couple of misconceptions that have been circulating regarding this bill. Firstly, this bill was drafted over 4 years ago and has been sitting in the ballot waiting for that lucky lotto number to be drawn. When I drafted the bill I made it clear that we were seeking to lower the age of criminal responsibility to 10. Tonight I confirm, particularly to the National Party, that that is not now the intention. We will adjust this bill in the select committee to lower the age of criminal responsibility from 14 to 12—the target is 12, not 10. Members will have noted that clause 12 in Part 2 is entitled “Children between 10 and 14”. That is the clause we will amend.
Secondly, I would like to address some misconceived views that are being bandied about by some opposing parties. Some members have attempted to claim that the passing of this bill will result in more young people in prison. Let me make it clear that this bill does not remove the Youth Court. It does not attempt to change the Family Court. It does not remove family group conferences. It does not change in any way by any iota the youth justice services that are available to young people today. After this bill is enacted those services will continue—and, I hope, in a far better fashion and to greater effect. Above and beyond anything, this bill helps people who deal with youth offenders in the field and are sick and tired of young people considering themselves at the age of 13 or 14 to be 10 feet tall and bulletproof.
I have travelled the country during the 10 years I have been in Parliament—and I think I am the longest-serving Law and Order Committee member, spokesperson, and advocate in this House. When I ask police officers—Māori, Pākehā, men, women, superintendents, inspectors, commissioners, and right down to the lowest levels—what one law Parliament could change tomorrow to help them deal with their problems on the street and help reduce youth offending, they all say the same thing: if we change the Children, Young Persons, and Their Families Act and the Crimes Act to lower the age of criminal responsibility and remove from these young people the feeling that they cannot be charged, imprisoned, or held to account, youth offending will plummet. It will do so for two reasons. First and foremost, the mere fact that they can be charged and held accountable is in itself for most young people, who are just pushing the limits and testing things, a deterrent. Second, the gangs and insidious creeps who prey on our children and use them to commit crimes because they know those children can never be charged will be put out of business immediately, because that protection will be removed. That will help stop gangs using kids to burgle homes to order and get goods that they then fence off, repaying the kids with tinnies. That is the sort of scourge we have on our streets.
If there is one aspect of this bill I am passionate about it is that I do not want to see young people going to jail as a result of it. I do not want to see one more child in a youth detention centre. Let me make that clear. Some members have said that this bill will put young children in jails. Before those members get on their feet to make speeches on that and mislead the House, I tell them that this bill will not do that. I want to see young people saved by being given the realisation that there is a limit beyond which their offending will not be tolerated. They will enjoy the benefits of the existing youth justice system. Let us be clear about that—even though it ain’t exactly successful. For all the hoopla and talk that I hear about how effective the family group conferences are, how effective the youth justice system is, and how effective Child, Youth and Family Services is—well, that is so effective it has been disbanded. How is that for effectiveness? How is that for credibility? Finally, even the Labour Government has given up on Child, Youth and Family Services.
I will leave the House with one name and one thought to ponder. Had a more appropriate intervention or warning been available for young Bailey Kurariki, would he today be in a youth detention facility serving a sentence for manslaughter? I will argue to my grave that he would not. I will argue to my grave that had proper interventions taken place and had the deterrent existed at an earlier stage young Bailey would never have been involved in that act of manslaughter. Another point to ponder is that if Michael Choy had survived that vicious and mean attack, the law as it currently stands would not have allowed the police to charge Bailey with what he did. The really serious crime is that kids can commit serious crime today and get away with it. This bill seeks to change that. I look forward to the other speeches, to my speech in reply, and to the opportunity to discuss this bill in the wider forum provided by the select committee.
KATE WILKINSON (National): Speaking on this bill, which National supports going to the Law and Order Committee, it is useful to reiterate what it does and what its rationale is.
To a certain extent, I agree with Mr Mark’s comments. The age of criminal responsibility is somewhat contentious. At present, under the Crimes Act, the age of criminal responsibility is 10, but a young person under 14 cannot be prosecuted for any offence except murder or manslaughter unless it can be established that the child knew what he or she was doing and knew that it was wrong—hence Bailey Junior Kurariki became the country’s youngest convicted killer at 13 when he was sentenced for murdering Michael Choy. The irony of the matter is that if Mr Choy had been only injured or wounded, then Kurariki could not legally have been charged at all.
This bill allows those young people aged 12 and over who are charged with serious offences to be tried in the general courts rather than the Youth Court. It keeps the current age of criminal responsibility for murder and manslaughter at 10, but introduces a new category of serious offences for anyone aged 12 or over.
Youth crime is certainly one of our most urgent problems. An overwhelming number of prison inmates began their criminal careers as young offenders. Young people aged between 10 and 16 are responsible for a quarter of the crime in New Zealand. Youth offending has been quoted as being 21 percent of all offending. We do need to get at-risk children off the conveyor belt to crime, and locking them up simply will not do that. And, yes, a person 10 years of age—or 12 years of age for that matter—is still a child.
As an aside, it is interesting that under the bill to increase the minimum legal purchasing age for alcohol, which is now set at 18 years of age, a person 18 years of age is also defined as a child. Yet, here, we are looking at treating a 12-year-old as an adult. So an 18-year-old is a child, and a 12-year-old is an adult.
Although many young people offend at some stage when they are growing up, under the present system some attend the youth justice family group conferences that Mr Mark referred to, and that is all. Others get recycled once, twice, three times, or even more through these conferences, but they keep reoffending. Research has shown that two-thirds of the 15 to 16-year-olds dealt with by family group conferences reoffend, and one in five ends up behind bars within 3 years.
Ron Mark: A real success, eh?
KATE WILKINSON: Very successful. Although total apprehensions of children under 13 have dropped, it is apparent, and it is concerning, that violent crime has actually increased. We need to consider the hard-core youngsters who repeat offend again and again. Some of these youngsters are committing very serious crimes—and very serious adult crimes. Lowering the age of criminal responsibility alone is not enough. It will not see these 12-year-olds convicted of serious crimes being locked up in adult prisons. We have four youth justice facilities with a total of only about 102 beds.
There is certainly an argument that if an adult crime is committed then adult time is done. Although members on this side of the House and New Zealand First certainly take the issue of young offenders very, very seriously, it is obvious from the retorts of members on the other side that they do not consider it a serious matter for our society.
These young people are not treated completely as adults. It is a sad indictment on our society when we have to protect our community from children under 12 years of age who have committed vicious crimes. This bill is the band-aid; it is certainly not the cure. But part of our duty as members of Parliament is the protection of society, and if that means incarcerating young people who commit adult crimes, then so be it. It is unacceptable for a youth to commit rape at the age of 13, but we must wait until he turns 14 and commits rape again before society is protected from him.
It is also interesting to compare the age of criminal responsibility in the bill with that in other jurisdictions. In North Carolina, the age of criminal responsibility is 6. In England, Wales, and Australia it is 10. In Canada and Ireland it is 12. So the age of criminal responsibility being suggested by this bill is certainly not out of kilter.
If a child aged 12 and over commits a serious offence under this bill, then we must look at exactly what is a serious offence. Under this bill it is defined as: “any offence—(a) for which the maximum penalty is imprisonment for a term of not less than 3 months or a fine of not less than $2,000;”. One may be so bold as to suggest that this should, in fact, be a minimum and not a maximum. However, that is an issue that the select committee can certainly duly debate and discuss.
These children may be children, but they are committing very adult crimes. Society deserves to be protected, but, most important, these children need to be saved from a life of crime. They need the protection of a more structured justice system. Incarcerating them in a youth justice facility for a period of, say, 3 months—and I understand the average stay is only 61 days—is simply not enough. It is not enough time to enable any effective rehabilitation of that young criminal. This bill does not go far enough, but perhaps a select committee is the forum to put some more teeth into it.
We suggest that judges need the power to help these children. Locking these children away will not help them. Giving judges more power to help them may actually assist in rehabilitation to keep them away from crime and to get them off that conveyor belt to crime. Judges need the power to help the parents of these children and to make sure that there are steps put in place for, say, curfews, and to deal with the parents perhaps by way of parenting orders—not as a punishment but as a positive development that is consistent with parental responsibility. After all, these children are very, very young, but they can also be very, very violent.
The judges need power to order effective rehabilitation. Locking the children up in a youth justice facility with no further action than that will not go a long way to rehabilitating them. We want these children rehabilitated and back leading a normal life in society. We need the judges to have more power to provide the resources to get these kids off the conveyor belt to crime.
National supports this bill going to a select committee, with the proviso that we feel that it certainly does not go far enough. There is the hope that the scrutiny of the select committee will give this bill some more teeth and make it more effective in keeping these children out of a life of crime, and off the conveyor belt to crime, and getting them back into society.
Hon MARK BURTON (Minister of Justice): The Government will support select committee consideration of the Young Offenders (Serious Crimes) Bill. The bill raises important issues about how we respond to children and young people who break the law. I may not agree with everything that the member who has just resumed her seat said, but I think her serious contribution underscores that this is a matter that Parliament must take seriously, and I think this bill attempts to do that.
The bill raises important issues about how we respond to children and young people who break the law. These issues will be of interest, of course, not only to members of the House but to many people, and should be given careful consideration. It is important that the bill be considered in the context of what we know about youth crime and what the Government is doing to address the problem.
Police statistics indicate that the level of child and youth offending has remained relatively stable over the last decade, and we should provide a backdrop to the debate here with these facts, although there has been a small increase in violent offending. In the last year youth offending actually fell by 10 percent, and I am optimistic that this downward trend can continue.
The Government’s approach to tackling child and youth offending is set out in our Youth Offending Strategy. The strategy is a comprehensive plan of action that focuses on—among other things—improved leadership and coordination of agencies, early intervention, and new measures to deal with serious and recidivist offenders. The Government has invested heavily in early intervention as the most effective way to achieve long-term reductions in crime and, ultimately, to address the vexing problem of the burgeoning prison population. We have, for example, increased participation in early childhood education, increased health checks for preschool children, extended the Family Start programme, and increased services to children who witness family violence.
Many of the recommendations in the Youth Offending Strategy have been implemented in the 4 years since it was launched. Notable achievements include establishing 30 youth offending teams around the country, training police and Child, Youth and Family Services staff on how to work together, the introduction of health and education assessments for many young offenders, and new programmes to address serious and repeat offending.
The Government is also taking steps to improve the legislative framework for dealing with youth offending by introducing the Children, Young Persons, and Their Families Amendment Bill (No 4), which requires that victims’ needs are considered properly and are recognised when dealing with youth offending.
I turn briefly to the objectives of the member’s bill. I agree that when young people break the law, we must respond quickly and firmly. Young people must understand the consequences of their actions and be held accountable for them. However, this does not logically support the principle in the bill of adult punishment for adult crimes. Young people are not little adults. But they certainly do need our guidance and support if they are to lead law-abiding and socially useful lives. Incarcerating large numbers of young people will not in itself address the causes of their offending or improve community safety.
The bill addresses the difficult issue of the age at which children and young people should be held responsible for their offending. Currently, the age of criminal responsibility is 10, and the age of prosecution is 14 years—except in cases of murder and manslaughter, where the age is 10. Accordingly, at 14, a young person can be prosecuted for the full range of offences, and his or her offending is dealt with in the Youth Court. Between the ages of 10 and 13, children’s offending is dealt with in the Family Court, principally as a matter relating to their care and protection. When it is established that the child committed the offence and knew that his or her behaviour was wrong or contrary to the law, the Family Court currently has a wide range of orders at its disposal.
It simply is not true, as some would claim, that the current law is without remedies when it comes to dealing with child offending. The bill purports to lower the age of criminal responsibility for a wide range of offences, from 14 to 12 years, and to remove the requirement of establishing that the child knew the offending was wrong. I make the point that that confuses the distinction between the age of criminal responsibility and the age of prosecution. As previously stated, the age of criminal responsibility in New Zealand is 10, and the age of prosecution, except for murder or manslaughter, is 14.
This bill, which addresses victims’ rights and how best to reduce the likelihood of reoffending—and therefore improve community safety—is an important bill. Although there may be serious debate about some of the measures within it, there is no doubt that select committee consideration and wider public debate of these important matters are desirable. Therefore, Labour is happy to support the referral of this member’s bill to the Law and Order Committee.
METIRIA TUREI (Green): The Green Party is opposing the Young Offenders (Serious Crimes) Bill. Although we recognise the importance of members’ bills and how difficult they are to get out of the ballot—let alone get to a select committee—the policy implications of the bill are so serious and so contrary to our principles and values that we simply cannot support it at all—even to go to a select committee. In our view, the current law is working sufficiently well. It was good to hear Minister Burton set out what the current law is so that it is clear for those in the community that Ron Mark’s bill does not add any value at all to the current legal situation. All the bill does is impose even greater penalties on those who are least capable of understanding the importance of those penalties, and least capable of extracting any value from increased punishment.
The Greens are very disappointed to hear that Labour is supporting this bill, because of the serious implications this has for children. Children, like adults, do very stupid, very dangerous, and sometimes very violent things. The reasons are complex and involve economic—
Ron Mark: Like rape women!
METIRIA TUREI: I take a great deal of offence at the use of those kinds of inflammatory comments, because they detract from the fact that we are talking in this bill about children—about 12-year-olds. I urge members to think about their own 12-year-olds. We talk in this House about one particular 12-year-old, Bailey Kurariki, as some kind of horrifying “Chucky”—some evil little thing—who is roaming around the country doing heinous things. I urge members in this House to think about their own kids getting themselves into a situation at age 12—where they have no control and when they are around bigger kids—that they cannot get themselves out of. Members should realise that their kids or my kids could be subject to this kind of legislation—this kind of punishment—because they do not have the skills, the experience, the maturity, and the judgment to figure their way out of it at age 12. That is what we are talking about here.
A number of complex and serious implications and impacts surround the child, especially one who is in the process of committing a crime. We talk about economic, cultural, and poverty issues that have huge impacts on adults in respect of criminal offending, let alone children. Those are incredibly acute issues that need to be dealt with in a practical and reasonable way—not in a way that simply punishes and locks these kids away. We must not treat and punish children in the same way that we do adults. Children cannot be expected to exercise the same judgment, common sense, or restraint that we expect from adults. They have an inherent reduced capacity, and they are at a particular reduced developmental stage that must be taken into account when dealing with them. We are talking here about 12-year-olds. I want to refer briefly to my own child, who is 13—
Ron Mark: Does she smoke dope?
METIRIA TUREI: I raise a point of order, Madam Speaker. I take extreme offence to Ron Mark making that kind of statement about my child. I seek an apology from him right now.
Ron Mark: I withdraw and apologise if that comment has offended the member.
The ASSISTANT SPEAKER (Ann Hartley): Thank you. That is the end of the matter. The member has withdrawn and apologised. I do not want any more interjections from the cross benches.
METIRIA TUREI: I will take a moment to feel a bit of parental pride and tell members that I think my daughter is a particularly bright and smart child, and she is very, very capable. Despite the fact that she is so fantastic, there is no way that she could be expected to exercise the sufficient judgment and restraint that would be expected of adults if she got herself into a difficult situation. That is why she has parents, and that is why I as a parent am legally responsible for her. She is in my care so that I can care for her and manage her through her developmental stages.
The principle behind Ron Mark’s bill leads to the idea that somehow at 12 years old children do not need parenting, and that they are at such a developmental capacity that they do not need to have adults around them to help guide them into the future. It is a bizarre concept and one that this House should disregard completely and entirely. We are completely opposed in the Green Party to the “three strikes and you’re out” approach. It completely fails to deter offenders anywhere in the world, and one needs only to look at the US statistics to see that all it does is lead to even more imprisonment. We simply cannot allow that for our own children.
We need more support for young offenders. We need more residential beds. There are only 126 residential beds and youth units in this country; there are twice that number in youth prison units. We simply need to have more resources put into children, rather than locking them up and throwing away the key.
This bill does nothing for victims and nothing for these young people. Ron Mark said in his speech: “Beyond here you go no further.” That actually means that that person is useless rubbish and to be discarded. The Greens will not support that evil principle.
Dr PITA SHARPLES (Co-Leader—Māori Party): I am sorry to hear that the two major parties are supporting this bill. [Interruption]
The ASSISTANT SPEAKER (Ann Hartley): Could we please not have any interjections across the benches. The speakers just cannot be heard.
Dr PITA SHARPLES: After an hour of family conferencing, I stood before a hardened offender who had a rap sheet as long as one’s arm. He was angry, violent, and unrepentant. I asked him whether he cared about what he had done. He shouted: “Go to hell!”. Then, in a flash of inspiration, I said: “What about your mother?”. At this point his mother rushed forward and began hitting her son with an umbrella, with tears rolling down her face. She said: “You shame me! All my life and your life you shame me! I pray for you and you let me down.” That adult man stood bolt upright and began to cry: “I’m sorry, Mum.” Those are the words that began his rehabilitation and healing. He went on to lead a productive life within society after three terms in prison and convictions for 25 offences. Restorative justice can work.
The Māori tribunal restorative justice programme began some 30 years ago, by chance. A school principal rang up and said: “Another six of your kids are in trouble. They stole from a dairy and pinched a Pākehā kid’s coat. Are you going to do something about this, or should I ring the police?”. I said: “No, we will handle it.” Without knowing what we were doing, we called a hui for all six kids, their parents, and the victims—the family of the boy whose coat was stolen and the dairy owner.
We all gathered, we had a prayer to open, and then we had the customary Māori greetings to each parent and family. We then sat the six kids up in front, and each of us had a turn at talking to them, saying: “Jimmy, what are you doing? Last year you were the haka leader, now you are a thief.”, and so on. There were hard words and kind words. At the end we gave the parents a cup of tea and we decided that the kids should work at the pensioners’ village for four Saturday mornings, supervised by us.
It worked that first time, the second time, and the third time. The schools started sending cases to us, then the police sent cases. Then Judge Mick Brown heard of it and he started referring cases of serious offending from the courts.
The family conferences worked because the offenders were made to be responsible to the members of their own community. They admitted guilt and had remorse. It worked because their parents and loved ones were there, and officials from departments were either absent or their numbers were kept at a minimum. Judge Brown used those experiences when he designed and wrote the programme for family group conferences for our courts. Now Australia has adopted the programme.
I cannot support a bill that sends 12-year-olds to prison. I have spent much time in my life working with those who are behind bars—in youth institutions, men’s prisons, women’s prisons, maximum security prisons, medium security prisons, old prisons, and new prisons, and with D Block inmates. I have been part of several initiatives that have set up programmes for rehabilitation and learning, and many of those are still running today.
Prisons do not work; they do not rehabilitate. There are alternatives, which I intend to talk about at some length at a later opportunity. But I will just say tonight that the culture of our prisons directly conflicts with programmes of healing and rehabilitation. There exists in men’s prisons a set of relationships that dominates every inmate’s activities, especially at times of conflict or incident. Nobody is outside that matrix. In women’s prisons the structure is even more rigid, with mother, or “Kingpin”, and her attendants ruling the roost and governing behaviour amongst all inmates.
The Māori Party has no interest in the industry of creating schools for baby crims, of teaching our teenagers how to incite terror in their communities, or of adding further to the painful programme of punishment this Government seeks to hand out. We believe in the potential for good. We believe that whānau are best able to determine their own solutions. We are committed to a system based on justice that heals rather than on justice that hammers—a system that must celebrate and actively engage all members in the pursuit of collectively owning the people and the problems daily life can bring.
So, in thinking through the implications of a children’s prison, it would seem that having jail for 12-year-olds will just create schools of crime where young, fertile minds are exploited and the rules and rigid roles of the game are used as training programmes for crime. The Māori Party says that that system is wrong. This bill is wrong. It is, as Children’s Commissioner, Cindy Kiro, has stated, “knee-jerk lawmaking”. Instead of looking to target the people whom Ron here describes as young thugs who bash people in the street, we must look at ways to reduce the offending, to rehabilitate youth, and to not set them on a life of crime.
Ron Mark: Tell us then, how.
Dr PITA SHARPLES: I will, in the next bill.
The Māori Party believes that the family group conference may need a review, but with the correct persons present it is still a positive plan for saving young people and for safeguarding our communities. We must work together to make communities take responsibility for their offending youth. The Māori Party does not support this bill.
GORDON COPELAND (United Future): First of all, I want to congratulate Ron Mark on having his Young Offenders (Serious Crimes) Bill drawn from the ballot. I look forward to following its progression through this Parliament.
I will begin, as I sometimes do in first readings, by standing back from the detail and looking at the climate that surrounds youth offending in this country. I was fortunate I think, with hindsight, to grow up in the 1950s when, due to a lot of parental guidance and also very good public relations by the police, we regarded policemen as our friends. We also had a very deep respect for the police, which included an element of fear related to their ability to put us in prison. I believe it was a very, very healthy thing in our society in those days.
I have seen that change quite dramatically during my lifetime. Now—and I hope it is still in the minority—there is a significant element amongst young people and indeed, as Metiria Turei describes them, children who flout the knowledge that the police cannot lay a hand on them. Indeed, that leads to a complete lack of respect—not only for the police but also for authority in general.
Tony Blair is in our country at the moment, or he may have just left. In the last election in Britain in 2005 this was a central issue. How do we avoid undue deference but get children and young people back to that basic value of respect, and that certainly includes respect for the police? I believe that we have swung the pendulum too far in this country, and therefore we will be supporting Ron’s bill.
It was also United Future’s policy in the last election to reduce the current age of criminal responsibility from 14 years to 10 years. We also had a policy to establish brat camps, run by the Army in cooperation with the Ministry of Education and the Ministry of Health, where persistent youth offenders would learn self-discipline and receive education, training, and counselling, as a last resort before prison; I make that point to Pita Sharples. I do not like the title “brat camps”. Personally I prefer boot camps. I think that is a better spin. In other words, we would be preparing these young people who have gone off the rails, to stay on the rails for the rest of their life. That is the aim, goal, and objective of this bill.
I think that those who jump straight to the conclusion that we are going to put kids in jail are really exaggerating what the bill sets out to do. We believe that it could work in conjunction with the young offenders legislation and be aimed at those people who commit a crime that falls just outside the definition of a serious crime—and that is the great majority of first-time offending by young people.
We were also to establish a three-strikes rule for youth offenders, whereby the number of family group conferences that youth offenders may face would be limited to three, before the third offence triggers a custodial sentence. I agree with Dr Pita Sharples that family group conferences are very, very worthwhile. I am strongly committed to them. But we also have to admit that for some particular types of personalities, the smart alec personality who is unrepentant, they are a flop. So we need to have something in place for that, and that parallels very closely the terms of this bill.
In respect of introducing tougher sentences, we think that sentences should more accurately reflect the nature of offending, the impact on victims, and reflect the social denunciation of crime. We do, as a society, undoubtedly need to send a strong message to our young people that there are consequences for actions. We so often, I believe, in our society today pretend that consequences do not flow from actions. In real life they do, and it is important that young people learn that principle very early on, in my opinion.
I would like to mention also that in England, for example, the age of criminal responsibility is 10 years—in other words, it is 2 years lower than the 12 years promoted by this bill. So this bill is not radical. It brings us into line with other Western nations. It is United Future’s view that it has the potential to nip crime in the bud, and that is a worthwhile objective at the earliest relevant point in a child’s development. I would like to make this point. Children on average know right from wrong at 7 years of age. It is tested, I know, because the Catholic Church has that test before it lets children receive Holy Communion, and it works virtually every time. At 7 years of age a child knows what is right and what is wrong. Five years later, if that child is still committing crime we need to get serious.
HEATHER ROY (Deputy Leader—ACT): I rise on behalf of ACT New Zealand to speak to the Young Offenders (Serious Crimes) Bill. ACT will be supporting this bill going to select committee. If passed, it will put in place many of the things that ACT has campaigned hard on during many elections, and it will help the police by giving them powers that at present they do not have when dealing with juvenile offending.
As ACT’s new national security spokesperson, I recently spent some time with the police. I spent a night shift with the Wellington police and a day shift with the Porirua police. When I asked them what the greatest difficulty was that confronted them, they said it was their inability and powerlessness to do anything productive with juvenile offenders. Anybody under the age of 17 presented them with severe difficulties. The only exception to that situation was where the juvenile was known to the police and to the Youth Court, and had breached bail provisions that were in place. In those circumstances the police were able to take young offenders who were in breach of their conditions of bail to try to deal with the situations, and some of the situations we encountered were quite nasty.
I think we should be under no illusions that we are talking about children, but they are children who know their rights and who are very well acquainted with the law. We are not talking just about first offenders. When I was out with the police, we came across several young offenders who, according to the police computer system, had a string of charges, but nothing had been able to be done about them. Several of those young offenders had been before the Youth Court many times and had been given any number of chances, yet their behaviour had continued to deteriorate and their offending continued to worsen as time went on.
There are three difficulties, all of which are addressed in Ron Mark’s bill, and I applaud the initiative he has put forward. The first difficulty is the inability of the Children, Young Persons, and Their Families Act to deal adequately with this situation, which is preventing the police from doing their job adequately. So the amendments in Part 1 of this bill to amend that Act are long overdue. Part 2, obviously, amends the Crimes Act, and Part 3 amends the Sentencing Act in relation to offenders under 17 years. These are important initiatives that must be discussed at the select committee.
I do not know whether what Ron Mark has put forward in his bill is the full answer, but the bill is a great opportunity to actually deal with youth offending in this country and to try to help those young people where we can. It is important that we send it to a select committee, get expert advice from a wide range of places, and discuss its initiatives properly. ACT is very pleased to support this great opportunity to do that. Youth offending is a great problem. Certainly it is an escalating one, and the police are recognising this.
I do take what the Māori Party speaker said to heart, though. He made some very valid points, and I think this bill does not preclude the opportunities that can exist for various communities to help deal with members of their own communities.
Ron Mark: We welcome that.
HEATHER ROY: As Mr Mark said, we should welcome that. We should invite it and welcome it in the spirit in which it is intended. Frequently in this House I stand up and lament the loss of the private prison, the Auckland Central Remand Prison. It did great things, particularly for Māori and Pacific Island communities. Now that the State has taken over that prison again, we hear there are difficulties there. That is a great shame, because very good work was happening there. I think we have much to learn from the memorandum of understanding that was developed between the Māori iwi groups and the Pacific Island community and from the very good work that went on there. That good work was allowed to happen because people took off their ideological blinkers and saw beyond the notion that the area of corrections could be dealt with only by the State. There is much to learn from our rich diversity of cultures, and it is now well known and well established that it is the communities themselves—the whānau and the Pacific Island communities—that are often best able to deal with those problems.
I think this bill will go to a select committee and I welcome that, but I would like to see as part of the discussions a broad range of submissions coming forward from all communities in New Zealand. So ACT will be supporting this bill and we look forward to its progress through the House.
PETER BROWN (Deputy Leader—NZ First): Let me start by clearing the air quite strongly. I do not know anybody at all who is keener and more determined than my colleague Ron Mark to see young people get a good start to their lives and to live fulfilled, decent, worthwhile lives. I have known Ron for a number of years now. I have listened to him on many occasions when he has talked about crime and youth crime, and I can tell this House he is absolutely determined to give young people a fair go at the start of their lives.
But this bill is not about that; this bill is about bringing in a new method to address the concerns we have about young people committing crimes. Its purpose is outlined in the opening sentences of the explanatory note, which I think it is very worthwhile to read to members: “The purpose of this Bill is to address the serious crimes being committed by young offenders. Young offenders, in some cases only children, have been responsible for a recent spate of very serious and shocking crimes.” If anybody doubts that, he or she should look at the crime figures in this country, and at the violent crime figures. I looked at them earlier on this afternoon. In 1990 I think there were 20,000 violent offences, or thereabouts. In the latest figures available, there were 45,000. That is a huge increase in violent offences.
I talked some time ago to a young police officer. She said many offenders start when they are young people—it is a sad fact of life that they start young. [Interruption] Madam Assistant Speaker, you ruled a little while ago that the interchange across the benches should stop. New Zealand First respected that ruling. I ask you to—
The ASSISTANT SPEAKER (Ann Hartley): Yes. Please, I do not want any interjections across the benches. It is disturbing for the speaker.
PETER BROWN: A little while ago I talked to a young female police officer in the Auckland area, and she told me about the incidents she had to deal with. On more than one occasion she would pick up a young person late at night, take that person to the police station in order to contact somebody about that person, and before the end of her shift she would have picked up the same person again. Those young people are back out, committing crimes. They have gone wherever the police were able to take them under the scope of the Children, Young Persons, and Their Families Act, and they are back out and being picked up for committing crime again.
If an incident was to make me realise just how serious this crime wave is, it was the time when I went home late one night, at 10 o’clock, to find my house had been burgled. It had been ransacked. Burglars had got in and had ransacked everything, everywhere. Drawers had been pulled out, beds had been turned up, and things had been stolen. I immediately called the police. The police came—one officer. He found what he thought were fingerprints. The police sent a fingerprint expert the following morning and the expert did, in fact, find fingerprints. A small hand, a quarter the size of mine, was fingerprinted in more than one place in that house.
I asked the officer whether that meant the crime had been committed by a kiddie. He said it meant there had at least been a child in the house, pulling everything apart. I asked what he could do when he caught the child. He said he could do nothing now, probably, but he did tell me that, in all probability, those fingerprints would turn up 10 years from now with a bigger handprint—and then the police would be able to do something. But meanwhile, the police officer told me, that young person would get away, effectively with impunity, with going from house to house as he or she dares, taking whatever he or she wants. On that occasion the burglar took a number of valuables. Nothing was returned, but I can tell members that the feeling one gets upon walking in and seeing that that has been done to one’s home is absolutely the pits.
It is with huge regret that New Zealand First believes we have to promote this bill, but there is a problem out there. It is a real problem, and by sending this bill to a select committee—as I think members of the House will do—we will at least give New Zealanders the chance to air their views and their concerns. I am fully supportive of my colleague, as all New Zealand First members are.
NATHAN GUY (National): Having listened to the speeches in the House over the last hour, I cannot help but think that the breakdown of the family unit is what leads juveniles to commit offences. In part, I believe, that is due to the social agenda the Labour Government has been pushing down society’s throat. The guardianship legislation has enabled people in de facto relationships to take over parenting, the Civil Union Act has been rammed down people’s throat, and family values in this country have been eroded. That breakdown in society causes juveniles to commit crimes. Some of the offences that are being committed are extremely dangerous.
Last year, in the election campaign, I was privileged to bring Celia Lashlie in to talk to groups that were willing to listen to her. She has a lot of experience in relation to the Good Man project and talked about how extremely important it is to have male role models in families. It is unfortunate that family units that have broken down often do not have a male role model. They therefore have to target one, whether it is the next-door neighbour, the after-school sports coach, or a male teacher.
Celia Lashlie talked about how very important it is for children, particularly boys aged around 10 to 12 years, to have parameters in their lives. She likened it to a square-shaped electric fence that children could see through and know where the boundaries were, because if they touched it they would get a zap. Unfortunately, when family relationships break down and there is no male role model, mothers are left very susceptible when it comes to bringing up boys. That, I think, is what drives the real issue we have in society today.
I say to Ron Mark that National will support the referral of his bill to the select committee, because we recognise that juvenile offending is a huge problem in our country. We believe—and I was pleased to hear Mr Mark say this—that the age of 10 years is a little too young. It is a little too extreme. At the select committee we will support reducing the age from 14 years down to 12 years for serious offences. We know that those young children—those teenagers—know when they break the law. We know that and they know that, and all that happens is they are slapped around with a wet bus ticket. They know when they break the law. We need to be tougher on those people, because the issue is a huge one in our society.
Also, it is interesting to note that if we are to get tougher on people who break the law in respect of gangs, then we need to have more police. We need to have more front-line police.
Darren Hughes: We got 1,000—6 months ago.
NATHAN GUY: I am surprised that Mr Hughes is even in the House tonight. I would have thought that at quarter past nine tonight he would be out there trying to get a bigger majority. He has the slimmest majority in the country, and that is in the Otaki electorate, which is where I am from. It is very important that we have more front-line police in order to get to the heart of the gang problem. Mr Mark can take his hat off for being part of increasing the numbers of front-line police by 1,000. That will help get to the heart of that issue.
To sum up, I think this measure is a good move. It is a moderate one and is in line with what happens in countries such as Canada and Ireland. The young people who offend will not be sent to jail. We have four youth justice facilities in this country.
Tariana Turia: Will the member visit the one in Palmerston North?
NATHAN GUY: I will. I would like to look through that facility with our law and order spokesperson, Simon Power, who is doing a fantastic job. We support this bill going to the select committee. Society has a real problem in the area of juvenile offending, and it starts with the breakdown of the family unit.
MARTIN GALLAGHER (Labour—Hamilton West): When this Parliament is at its best, it debates issues in good spirit and recognises members’ day. In debating the Young Offenders (Serious Crimes) Bill, I was hoping, until the last speech, that we would avoid some of the petty point-scoring that has been occurring.
I say to a member opposite, Nathan Guy, that he should not dare lecture me about family values. If he wants to have a bit of a chat about family values, then he should not lecture me about adultery, infidelity, and things like that. We need to be really careful if we want to go down that path. I have had a gutsful of those people opposite who have cynically gone on about the family unit. That member may laugh, but if we want to go there, we should step a bit further. For the benefit of those who are listening to Parliament tonight, that man actually said that New Zealanders who are in some form of civil union have no family values whatsoever and are terrible people. Effectively, that member and other members opposite have said that the National Party does not want to know people who are, for whatever circumstance, in a de facto relationship. I am really sad that the previous speaker stooped to some opportunistic, low-down point-scoring.
I want to come back to the purpose of this bill and the opportunity it gives us. I will not say anything about the attack on the family unit that the National Government in the 1990s was responsible for—
Brian Connell: I raise a point of order, Madam Speaker. I have been timing this member. He is now 3 minutes into his speech. He has not addressed this bill, at all. I ask you to bring him to order, please.
The ASSISTANT SPEAKER (Ann Hartley): The member has come back to the point, and I think he was addressing points that were made by the previous speaker, too.
MARTIN GALLAGHER: I thank my good friend and colleague Brian Connell for bringing me back to the bill, because he has reminded me that time is running out.
The bill is to be referred to the Law and Order Committee, and as the chair of that committee I am certainly looking forward to receiving it. I hope the committee can have a detached discussion on it, look at all the issues, and address some of the very, very important issues that Ron Mark and others in the House have raised. I really hope we do not get into some kind of political posturing, and that was my concern about the previous speech. With due respect to the previous speaker, I think he detracted from what has been a very valuable and considered debate in the House tonight.
I also hope the select committee will take the opportunity to hear some of the good-news stories that are happening in this country in respect of youth offending. I come from a city that has youth offending teams that are doing some really fantastic work. A number of programmes out there are trying to address the problem, and we want to take the opportunity to look at which of them are working. Certainly, I concur with Ron Mark, the sponsor of the bill, that there are issues of serious concern—and I have struck these in my own city and my electorate, Hamilton West—relating to youth offending and appropriate penalties. For example, I was talking to my colleague Clayton Cosgrove, the good MP for Waimakariri—an incredibly hard-working MP. He told me about the Turn Your Life Around programme, by Mr John Banks—not the John Banks of Auckland fame—which is very, very victim oriented. I understand that at any time the victim can pull the plug on that particular programme.
It is really important in the context of this debate that we look at some of the rafts of positive measures that are happening. I will also be very interested—and I think Mr Mark alluded to it; certainly he did in my discussions with him—in overseas examples in relation to the age of criminal responsibility. Also, in terms of the discussion on the family unit, it is obviously up to us all to do what we can. That is why I am such a passionate believer in our Family Start programme, and I honour the people who are involved in it in my city, and who are trying to intervene at the very beginning of problems so that we do not have tragedies down the track.
Finally, I look forward to this bill coming to the Law and Order Committee, and to that committee giving it a very fair hearing. I also look forward to hearing the witnesses and the evidence. I think the exercise will be very constructive.
BRIAN CONNELL (National—Rakaia): Madam Assistant Speaker, I seek leave of the House to make a contribution to this debate. I understand that the National Party speaking slots have expired.
The ASSISTANT SPEAKER (Ann Hartley): Leave is sought for the member to speak. Is there any objection? There is not. The member has 5 minutes. Is that what the House wants? It is—Mr Connell has 5 minutes.
BRIAN CONNELL: I thank members of the House for allowing me to make a contribution. I start by congratulating Ron Mark on having the courage to come to this House with this type of legislation. I am sure he did not arrive at that position easily. The basis of the genesis of his argument is simply that if our kids engage in adult crime, then they must do adult time. Do I take any comfort out of that? Absolutely not. It is a sad day for New Zealand that we are debating this type of legislation, but the reality is that this country has changed so much that we are now forced into this situation.
It is an undeniable fact that so much of our violent crime now is being perpetrated by young people—kids—and we have to address that issue. We have to have the courage to address that issue. People in this country have the right to feel safe in their houses at night. We must take off the gloves, as Martin Gallagher invited me to do, stop being politically correct, and start addressing the issues. I say to my Māori Party colleagues in the House that you have to start lifting your game as well, because a lot of the kids who perpetrate the crimes are your people. I heard the leader of the Māori Party say that we need to sheet home some of the responsibility to parents. She is right, but she needs to take more of that responsibility.
Tariana Turia: Do you take responsibility?
BRIAN CONNELL: Yes, I have taken responsibility.
Tariana Turia: For Pākehā?
BRIAN CONNELL: Yes, we are taking that responsibility. Let us share that responsibility—that is the argument I am mounting—and let us stop burying our heads in the sand. Will putting our kids in prison serve a great purpose? No, it will not, and I accept that argument. What it will do, though, is give us time to address the ills of this country. They are severe. So we need to start introducing some policy that will break the nexus of the crime rate, which is spiralling out of control. In that regard, I think I share some of the aspirations of my colleagues in the Māori Party, and that is that we have to get people off welfare.
Clearly, there is a correlation between welfare dependency, low educational outcomes, and high crime rates. Unless we have the courage to break that nexus, then, unfortunately, we will see ourselves in a situation where we are putting more and more of our young kids in prison. It is an undeniable fact that so many of our young kids on welfare are Māori. We can put our heads in the sand tonight, but that is the reality. I am here trying to make a constructive contribution, because it is one of those things that we have determined not to argue about in the past, but we now have to address it.
So I come back to where I started, and I say again that I think Mr Mark is on the right track. It is a sad day that we are in the House discussing this issue, but the reality is that it has been forced on us. One has only to look at the crime statistics now to see who is engaging in violent crime. Unfortunately, it is our young people, as young as 10, 9, and 8 in some cases. I do not take any great pleasure in acknowledging that fact. I accept that, in some ways, a failure of our society has put us in that position. However, we do not address it by denying it. I look across at the member for Waimakariri and I think: “He’s going bald, he is without ideas, and his contribution thus far just demonstrates that he really is devoid of any constructive views whatsoever in this House.” Mr Mark has had the courage to put into the public debate the argument that forces us to address what is really happening in this country, which is that welfare dependency is spiralling out of control. We are now reaping as we have sowed.
The ASSISTANT SPEAKER (Ann Hartley): Before I call Mr Mark, I just say to members that a number of speakers have brought the Speaker into the argument. I do not like to interrupt a member’s speech to tell him or her that. Members should know that.
RON MARK (NZ First): I am absolutely astounded that two of the people in this House who pride themselves on achieving academic accolades, on being able to be inclusive and consult people, and on seeking other views, and who pride themselves in debate, should show such high levels of intolerance and reject outright that this bill should be debated by the public in a select committee. I am disappointed in Dr Pita Sharples. One does not have to be brown, grow long hair, and have tattoos to understand that our Māori people are heavily engaged in crime. I may not have some of Dr Sharples’ attributes but my family, too, are as heavily engaged in crime. One of the reasons I am concerned about youth crime is because of my background as a ward of the State, growing up in a welfare system, with, I would guess, something like 50 percent, if not more, of my whanaunga, my immediate family, having ended up in prison. What a disaster.
I do not disagree with one word Dr Sharples has said about the appalling failures in the Department of Corrections, but where was he when its members were running riot with the “goon squad”? There is silence. I, Ron Mark, fought that issue, brought it to the House, and created a situation that led to the Duffy investigation, ably assisted by Mr Connell and other members who are no longer in this House. Do not presume that we do not share Mr Sharples’ concerns for the things of which he speaks, but please give us the opportunity to discuss these issues in a select committee, which is something he has ruled absolutely out of hand. As my whanaunga I tell him that I am disappointed in his decision.
How dare members of the Green Party stand up and tell us what is right and wrong in the youth justice system, while advocating that everyone should be able to smoke marijuana. One of that party has shareholdings in a company that sells party drugs. Let us talk about youth crime and its causes, the tragedy of wasted human capital, and the tragedy of the waste of human lives, but do not dare stand in this House and be so pious and preach to me about how their views are more substantive and more worthy than mine. Walk in my shoes with my whanaunga, see the damage that marijuana causes, and then come and talk to me.
I do not have to argue the need for this bill. Members can pick up any newspaper and read about an 8-year-old knife-wielding burglar locked up by Child, Youth and Family Services. The boy knew that the police were powerless to charge him for his criminal offences. This is not knee-jerk, this was not yesterday, this is not today; this was in August last year. Talk to me about a young man out of control in Masterton, who drove his car at speeds of 100 kilometres an hour through busy, populated streets where men, women, and children were walking. He did this not once, not twice, but dozens of time and laughed at the police, because they can do nothing with him. Do not talk to me about what the law can deliver. We know that a person under the age of 14 has to kill someone in order to be held to account. We know that to bash a woman with a hammer, to render her immobile for the rest of her life, and to cause serious brain damage that will prevent her from nurturing and caring for her children can go unpunished. There is no law that brings that young man to court, and members dare to tell me that they care more. We all care in this House. That is why we are here. The only one thing we can guarantee the people of this nation is that we will debate these issues. We will let victims and offenders jointly come to the select committee and air their views, and then we will make a considered decision. But for that considered decision to occur we must all vote this bill to select committee, and I beg each and every party in this House to do that now.
A party vote was called for on the question, That the Young Offenders (Serious Crimes) Bill be now read a first time.
Ayes 111
New Zealand Labour 50; New Zealand National 48; New Zealand First 7; United Future 3; ACT New Zealand 2; Progressive 1.
Noes 10
Green Party 6; Māori Party 4.
Bill read a first time.
Bill referred to the Law and Order Committee.
RON MARK (NZ First): I raise a point of order, Madam Speaker. I apologise for interrupting at this point, but during the debate some comments were made, and I actually was out of line with Metiria Turei. I do believe that she totally misunderstood what I said. But I just wish again to apologise to her for any offence caused.
Bills
Residential Tenancies (Damage Insurance) Amendment Bill
First Reading
MARYAN STREET (Labour): I move, That the Residential Tenancies (Damage Insurance) Amendment Bill be now read a first time. It is my pleasure to introduce this bill, and at the appropriate time I intend to move that the bill be considered by the Social Services Committee.
This bill has arisen out of a perceived unfairness in the application of the current Residential Tenancies Act 1986. The bill contains three small, but significant, amendments. The first amendment is to insert the following clause into section 45(1) of the principal Act, after paragraph (d): “(da) insure the interests of the tenant against liability for damage to the premises;”. The second amendment is to amend section 45 of the principal Act by inserting after subsection (4) the following two subsections: “(4A) Subsection (1)(da) does not apply where the damage is intentional and the tenant is personally responsible for it.” and “(4B) Except as provided in this Part, no tenant is liable, whether to the landlord, any insurer of the landlord (whether acting by way of subrogation or otherwise), any other tenant, or any other person, in the event that the landlord fails to take out insurance as provided in subsection (1)(da).”
The purpose of these amendments is to protect innocent tenants against liability for damage to premises that they did not cause, through providing for the extension of landlords’ insurance cover. The current situation is that, under the Residential Tenancies Act 1986, tenants are liable for any damage that they or their invited guests cause intentionally or carelessly. In multiple-tenant tenancies, tenants usually have joint and several liability. This means that tenants can be held liable for a breach of the tenancy agreement, regardless of which tenant committed the breach. If a tenancy agreement is breached through careless or wilful damage to the property, then the tenants are jointly and severally liable for costs of repairs under common law, regardless of which of them caused the damage.
Under the current law, landlords are responsible for the payment of all insurance premiums payable in respect of the rented premises. Although landlords are not required to obtain insurance or to insure premises for the benefit of their tenants, it is most likely that landlords do, in fact, have their properties insured as a matter of good business practice.
A tenant’s liability for careless or intentional damage to a property is not affected by the fact that the property is insured. If an insurance company believes that a tenant is liable for damage, it may step into the shoes of the landlord, pursuant to the rights of subrogation, to seek compensation from the tenant. Subrogation rights impart to the insurance company the right to take action against any party in the name of the insured. The amendments in this bill extend the provision to insure the interests of the landlord to insuring the interests of the tenant as well.
Under the existing law, tenants can insure themselves against the risk of being held liable for damage by obtaining personal liability insurance. Personal liability insurance is often part of normal household contents insurance, or can be added to it. As I understand it, some insurance companies will consider personal liability insurance without the contents policy attached. Policies may contain a number of exceptions or provide limited cover. The key point about that, however, is that very few tenants have such cover. That leaves most tenants engaged in tenancy agreements, which, under common law and in line with the Residential Tenancies Act, leave them jointly and severally liable for damage to the property they rent, regardless of whether they caused the damage. It seems to me to be unfair to insure landlords’ interests but not tenants’ interests. That is the unfairness that this bill seeks to address.
In the end, this bill does not absolve tenants from their contractual obligation to not damage the rented property, either intentionally or carelessly. Further to that, it is explicit that when damage is intentional and the tenant is personally responsible for it, his or her protection under the amendment does not apply.
The reason for this movement to insure the interests of tenants comes from some incidents in recent years in which innocent tenants were found liable for compensation when a house was damaged. One of the clearest and most definitive judgments on this issue came in the case of Harrison v Shields and others and Medical Assurance Society New Zealand Ltd. The presiding judge was Judge MacAskill.
The case involved six flatmates at an address in Dunedin. Five of the tenants had signed a common written tenancy agreement. The sixth tenant had not signed it. On 11 June 1999 the only tenant at home at the time left some bacon cooking on the stove and went next door. While he was away, the place caught fire and considerable damage was done. None of the man’s flatmates were home at the time of the fire. The other four signatories to the tenancy agreement did not intentionally, or carelessly, damage the flat by fire. As they were not present in the flat, they had no knowledge of, and were unable to control, their flatmate’s actions.
The flat was damaged by the fire. Some of the contents were destroyed or irreparably damaged. The landlord had insurance cover and the property was restored, with a consequent loss of rental income while the repairs were being carried out. The insurer stepped in to recover the costs from the tenants, as it was entitled to do under the rights of subrogation. In the event, the judge ruled that the four flatmates who were signatories to the tenancy agreement, as well as the flatmate whose carelessness caused the damage to the property, were jointly and severally liable for the net recoverable loss of $67,381.07 plus interest.
When issuing the judgment, the judge had these comments to make: “The outcome of this proceeding, though in accordance with the law, is unjust. It is unlikely that the defendants were ever aware that their landlord (or the landlord’s insurer acting by right of subrogation) might sue them for major damage to their flat, even if caused by the carelessness of one of them. I have no doubt that while most residential tenants assume (almost invariably correctly) that their landlords insure and will be indemnified against damage to, or the destruction of, the insured property, they have little or no understanding of the insurer’s right of subrogation.” Judge MacAskill continued—
Sandra Goudie: Abrogate responsibility then, why don’t we!
MARYAN STREET: A little bit like the member opposite. She is welcome to take a call.
Judge MacAskill continued: “They assumed that if a landlord is insured, they, the tenants, are not at risk. Few tenants insure against their potential liability.” He went on to say: “Where the tenants are insured, the insurers usually settle between themselves. Where the tenants are not insured, they often have too few resources to be worth suing, and are not sued for that pragmatic reason. Where not all joint tenants are insured, a claim may be brought against all in order to recover from the tenants who are insured … Putting aside all these variables, I am then of the opinion that, in general, the pursuit of substantial claims against tenants with respect to damage caused carelessly is oppressive in effect, and I respectfully urge that the law be reformed … A simple and effective solution would be for the legislature to amend the Residential Tenancies Act 1986 to require landlords to insure the interests of tenants.” That is exactly what the bill is designed to do. That is exactly the injustice that this bill is designed to address.
Nothing in this bill prevents the landlord from passing on any consequent increase in premiums to the tenants in rent. It simply seeks to place liability where it should lie, and not where it should not lie.
I suggest that the consideration of this bill is most appropriately addressed in the context of the current wide-ranging review of the Residential Tenancies Act.
PHIL HEATLEY (National—Whangarei): I rise to put the National Party’s view on the Residential Tenancies (Damage Insurance) Amendment Bill. The bill amends the Residential Tenancies Act. It provides for landlords to insure the interests of a tenant against liability for damage to the premises that they took no part in causing. It is designed to protect “the innocent tenant” from liability. The bill does not prevent the landlord from passing the costs of insurance on to the tenants as an increase in rent, and it would not apply if the damage were intentional. National opposes the bill.
The member who introduced the bill put up the case where six flatmates in Otago witnessed $67,000 worth of damage to their flat because one flatmate had a fry-up while the rest of them were out. I wonder whether they were scarfies—six flatmates in Otago, five were out, and the other one was having a fry-up on the stove. I do not think they were scarfies; I think they were 45-year-old, middle-aged men and women. Five of them were out working late that night and the other one had not eaten for days and was having a fry-up. I do not think they were scarfies. Anyway, one of them was having a fry-up at night while the other five were out. That flatmate started a fire that caused $67,000 worth of damage, and do members know what the Labour Party member says? She says it is the landlord’s fault! She said five scarfies were out boozing, one came home for a fry-up and caused a fire, and it is the landlord’s fault and he should pay.
But the Labour Party member does not stop there. It is not just the landlord’s fault. She wants us to pass legislation, because she said it is 20,000 landlords’ fault. She wants 20,000 landlords in this country to pay insurance so that their tenants will be covered when they cause damage or vandalism, or have fry-ups and burn the house down. That is absolutely absurd.
I ask whether the member has done any study on this issue, because my understanding is that there is no widespread tenant dissatisfaction with current insurance arrangements. If there is minor damage, a bond is paid, and that can be uplifted. We know that landlords today insure their homes against being burnt down, seriously damaged, or anything like that happening. We know that tenants generally insure the property they have within a home. But in this bill we have a situation that if a tenant invites a guest in, and that guest decides to take an axe to the door, kick a hole in the wall, or spill wine on the carpet and causes damage, it is the landlord’s fault. Did the landlord invite the guest? No. Did the landlord invite the flatmate to share the tenancy? No. But the landlord will pay.
There are two hooks in the bill. One is the issue where apparently tenants, first of all, have to prove that it was not them but a flatmate or a guest who did the damage. If that is in dispute, how will the landlord or insurance company establish whether it was the guest, flatmate, or tenant who did the damage? How will the landlord or insurance company prove that?
The second little fish-hook is that, in many instances, it will be difficult to prove whether the damage was deliberate or accidental. This bill says that recovery will take place when it is accidental damage. If that is in dispute, and the tenant, guest, or flatmate says it was an accident, how will we ever prove whether the hole in the wall was accidental or deliberate? I will tell members—the bill says it is the landlord’s fault he or she is not there 24 hours a day assessing who comes into the house and who does not, and looking over the shoulder of everyone to see who causes deliberate or accidental damage.
This bill makes it the landlord’s fault. In the case of the six tenants in Otago—
Chris Tremain: The 45-year-olds.
PHIL HEATLEY: —the 45-year-old, middle-aged men and women flatting together, where five were out working late and the other one was hungry and had a fry-up, it was the landlord’s fault because the landlord was not there watching over the stove and the fry-up. The landlord did not know whether it was deliberate or accidental. The landlord never stopped other tenants coming into the house, and never checked whose shoes were under the bed. That is right. What if a lover visits, and we see some sort of foul spillage on the carpet or whatever, who is to prove whether that act was an accident or deliberate? How will we prove whether that damage was caused by a tenant or guest—a guest whom the landlord never invited in the first place?
It is currently possible for an innocent tenant to recover the cost of damage or insurance from a guest or flatmate, is it not? If a guest comes into a home and causes deliberate damage, and the tenant has to pay the landlord, can that tenant not go to the courts and seek some sort of redress from their guest? One can do that by law now. Why do we need to bill 20,000 landlords when an opportunity for redress already exists?
We also have an opportunity for redress through the bond system, if the damage is minor. Landlord-tenant negotiations can allow an insurance agreement to be made, if people really want one, in individual cases. Why do we have to legislate that it must happen for everyone? Why do we have to legislate that every landlord must go through this with every tenant? We should not have to. If landlords and tenants want to come to an agreement, let them do so. Let them have freedom of choice. A fourth opportunity for redress is that a standard tenancy agreement may be drafted to contain a clause requiring tenants to obtain their own insurance for the careless acts of their guests—not the landlord’s guests but the tenant’s guests.
Those are the opportunities to fix this problem, however minor. We can help the scarfies in Otago in four ways. We have the bond, which is paid now. Tenants can get redress from a guest—they can send the bill on to the guest. The landlord and the tenant can make an insurance agreement between themselves. And the tenants themselves can get insurance. There is no need for legislation affecting thousands and thousands of landlords throughout the country.
I note that the Housing New Zealand Corporation is a landlord and will now, because of this legislation, have to pick up the bill for all vandalism and damage done to its properties. I will reveal a bit more about that in the next month or two. I know that Minister Clayton Cosgrove is nervous because he knows how much vandalism is happening in Housing New Zealand Corporation homes.
This bill is absolutely irresponsible. There is no need for it whatsoever. National opposes it on the basis of our principle of personal responsibility. It is not the responsibility of landlords to assess who comes into a home and who does not 24 hours a day. It is not the landlord’s responsibility at all to decide who puts shoes under the bed at night and who does not. This issue is about personal responsibility, where a tenant needs to look after the property he or she is in. National opposes this legislation.
PITA PARAONE (NZ First): I preface my contribution to this debate on behalf of New Zealand First by asking what the last speaker’s view would be if he were one of the five flatmates referred to in the judicial decision cited by the sponsor of this bill who now find themselves responsible for the damage caused by another flatmate.
Phil Heatley: I seek leave to answer the member’s question, which he has asked me directly. [Interruption] No, I seek leave. I am entitled to seek leave.
The ASSISTANT SPEAKER (Ann Hartley): The member seeks leave to interrupt. Is there any objection? [Interruption]
Phil Heatley: So it wasn’t a serious question—you don’t want to know the answer, Mr Paraone?
The ASSISTANT SPEAKER (Ann Hartley): I was putting the leave question. The member should not engage across the floor while I am putting that question.
Phil Heatley: You put—
The ASSISTANT SPEAKER (Ann Hartley): If the member wants to remain in the House, he had better stand, withdraw, and apologise—and make no further comment.
Phil Heatley: I withdraw and apologise. I raise a point of order, Madam Speaker—
The ASSISTANT SPEAKER (Ann Hartley): I am seeking leave on the member’s behalf. The member has asked for leave. Is there any objection? There is.
Phil Heatley: I raise a point of order, Madam Speaker. I want to clarify the record for members in the House. You put the leave, and the member denied leave. Leave was denied. That is when I commented. I was not engaging you or any member of the House while leave was being requested. You asked for leave, the member denied leave, and I commented. I would never interrupt the Chair. It is not my habit to interrupt the Chair, and I will never interrupt the Chair.
The ASSISTANT SPEAKER (Ann Hartley): The point is that I was still speaking. The member is just lucky to remain in the House.
PITA PARAONE: Speaking to this bill, I reiterate its intent. It requires landlords to ensure the interests of tenants, notwithstanding the arguments against that position, as the last speaker mentioned. The bill is meant to provide some form of protection for those tenants who are not directly responsible for any damage caused by a fellow tenant, and therein lies the crux of this bill.
It is also intended to address the issue of tenants mistakenly believing that the landlord’s insurance will cover such damage. In reality, insurance companies seek to cover their costs in such claims from all the tenants, regardless of direct responsibility or otherwise. However, it is important to note that this bill does not absolve tenants from responsibility where there has been intentional damage—they remain liable.
Of further note is an article in the New Zealand Herald last week, for which an executive member of the New Zealand Property Investors Federation was interviewed, which claims that landlords have indicated strong opposition to this bill on a number of points—and I want to highlight some of those points. First is the transient nature of group flatting situations that can involve tenants coming and going without the knowledge of the landlord. Second, the likely consequence of this in the event of a claim could see insurance companies insisting that the landlord not only find the departed tenant but also prove that that tenant was the one who caused the damage in the first place. Third, tenants could also blame visitors to the property. These potential situations would make renting to groups a high-risk undertaking and could lead to groups finding it difficult to secure rental accommodation.
Clearly, this bill would impose some extra costs for landlords in terms of their insurance premiums. Landlords believe, of course, that their tenants and not themselves should be meeting the costs associated with their premiums. Obviously, tenants would be paying indirectly through their rent anyway, so this is an issue that ought to be examined.
I understand that the sponsor of this bill has indicated that the Government intends to undertake a general review of the Residential Tenancies Act 1986. She feels that it might be appropriate to have this bill included in that process. New Zealand First has always stressed the importance of the people of New Zealand having their say, notwithstanding the reported comments that I alluded to earlier and the judicial example given by the sponsor of this bill.
New Zealand First will support this bill going to the select committee so that the people of New Zealand and, in particular, the parties who will be immediately affected by it have the opportunity to have their say. Having indicated our support for the bill going to the select committee, I want to make the point that I cannot guarantee that we will support it beyond that.
CHRIS TREMAIN (National—Napier): Growing up in this country, my mother and father taught me a few values like do-it-yourself, giving it a go, “Hard work is actually good for you.”, and “You’re there to compete to win.”, and they taught me that self-responsibility was something one should be proud of. Gradually, we have seen these values dissipate in our nation. The new Building Act has taken care of the do-it-yourself attitude, the occupational safety and health legislation is busily taking away the give-it-a-go attitude, and Working for Families is quietly taking away the incentive to work in this country. Now self-responsibility is further under threat with this bill. The Residential Tenancies (Damage Insurance) Amendment Bill is an attack on personal responsibility. As a result, and as Phil Heatley quite rightly said, National will not be supporting this bill.
What does this legislation set out to do? It sets out to protect tenants against personal liability for major damage to premises that they played no part in causing. There are two key phrases: “major damage” and that “they played no part in causing” the damage. I will come back to those.
Debate interrupted.
The House adjourned at 10 p.m.