Wednesday, 5 May 2010
Volume 662
Sitting date: 5 May 2010
Wednesday, 5 May 2010
Wednesday, 5 May 2010
Mr Speaker took the Chair at 2 p.m.
Prayers.
Questions for Oral Answer
Questions to Ministers
Mining in Conservation Areas—Ministers’ Recommendation in Cabinet Paper
1. Hon PHIL GOFF (Leader of the Opposition) to the Minister of Energy and Resources: Has Cabinet rejected indefinitely the recommendation he and the Minister of Conservation, Kate Wilkinson, made to consider mining 467,517 hectares of national park and protected conservation areas?
Hon GERRY BROWNLEE (Minister of Energy and Resources): Quite apart from the fact that there was no proposal to mine that land, I have to say—
Hon Members: Oh!
Hon GERRY BROWNLEE: I note the tricky wording of the question, so I reply that Cabinet has definitely rejected that early proposal.
Hon Phil Goff: Why did Cabinet decide not to follow his advice to remove protection from areas like Rakiura National Park, Kahurangi National Park, and Mount Aspiring National Park?
Hon GERRY BROWNLEE: In the case of Rakiura National Park, the discussion document asks New Zealanders to consider whether a further aerial magnetic survey is a good idea.
Hon Phil Goff: I raise a point of order, Mr Speaker. The question was quite specific: why did it decide not to remove protection from the three areas? That answer did not address that question at all.
Mr SPEAKER: I will let the honourable Leader of the Opposition repeat his question so that everyone can hear it clearly, and we will listen to the answer.
Hon Phil Goff: Why did Cabinet decide not to remove protection from Rakiura National Park, Kahurangi National Park, and Mount Aspiring National Park?
Hon GERRY BROWNLEE: I say again that Cabinet decided that some aerial magnetic survey of Rakiura might be a good idea. That is part of the discussion document, and that question is being asked of New Zealanders. In the case of other parts of the national park system, there was analysis—and it is also in the document, which the member will have read—that led Cabinet to believe that it was not appropriate to open them up for further prospecting.
Hon Phil Goff: Why was it not appropriate to mine those three national parks, but it was appropriate to look at the Coromandel and Great Barrier Island for mining?
Hon GERRY BROWNLEE: It is because in those cases, Cabinet felt that it was reasonable to ask New Zealanders whether we should make available those tracts of land for further exploration. Simple.
Chris Auchinvole: Can the Minister—
Mr SPEAKER: I apologise to the honourable member, but I say to the Labour front-benchers on this occasion that it is hardly fair on the member asking a supplementary question when there is so much noise.
Chris Auchinvole: Can the Minister give an example of a mine that strikes a good balance between economic benefit and environmental sensitivity?
Hon GERRY BROWNLEE: I hope that all of the 118 permits issued by the previous Labour Government comply in that regard. I can do no better than quote to the member the words of a former Minister of Conservation who said, when approving the Pike River mine, that it was an area of high conservation value, that when Pike River reached full production it would employ 150 people directly and another 450 indirectly, that it would provide 1 million tonnes of coal a year to be added to the receipts for our current account, and that it would provide lots of jobs. I ask Phil Goff whether he will go back there next year—just as he did last year to try to reconnect with the Labour heartland—and take Trevor Mallard’s advice and say: “You’re finished. You’re out. Sayonara.” Of course he will not.
Hon Phil Goff: When he said to the House yesterday, wrongly, that Labour was prepared to, and did, mine in protected schedule 4 land, was he referring to—as the media has since analysed—a permit that was granted when National was in power, a permit that allowed gold and gem fossicking by an elderly man with a shovel, or a permit granted before the relevant park had been gazetted as an area protected from mining?
Hon GERRY BROWNLEE: I answered a question in the House from David Garrett by pointing out that there were two permits for mining on schedule 4 land issued by the previous Labour Government. That is absolutely correct.
Hon Phil Goff: How does he reconcile his statement that the Government’s mining proposals are “quite modest” with his earlier claim that mining would be key to the step change in the New Zealand economy?
Hon GERRY BROWNLEE: Quite simply—[Interruption]
Mr SPEAKER: I apologise to the Minister. Members ask questions and either they want to hear the answers or they do not. Quite so much noise makes it very hard for anyone to hear the answers.
Hon GERRY BROWNLEE: My answer is quite simply that mining at the moment takes up 0.015 percent of New Zealand’s land mass. If that were doubled, it would still be largely unnoticeable but it would provide some $4 billion to $5 billion in GDP. It could provide a similar amount in export receipts over a longer period of time. It is part of—and I have maintained this all the way—a number of things that will lead to a step change in the New Zealand economy. I note that through the 5 years that Phil Goff was the Minister of Trade for New Zealand, our export went backwards. I am not surprised that he is advocating retrograde policies now. He cannot work out what he is for or against. The good thing is that he will not be Leader of the Opposition for much longer.
Mr SPEAKER: Most of the last part of that answer was unnecessary.
Hon GERRY BROWNLEE: I raise a point of order, Mr Speaker. I withdraw and apologise.
Mr SPEAKER: This is getting altogether a bit messy. I acknowledged a point of order but I could not hear the point of order being made. I take it that it was not a genuine point of order, so we will not take further time on it.
Hon Darren Hughes: I raise a point of order, Mr Speaker. I understood that the Leader of the House stood to withdraw and apologise. I was not clear whether that was to the House or to his own colleagues over his handling of this matter.
Mr SPEAKER: The Hon Darren Hughes knows that that is not a point of order. That member is normally a model of discretion when it comes to the Standing Orders of the House.
Hon Phil Goff: What is the Minister’s response to criticism from the New Zealand Tourism Industry Association that his proposals have already damaged New Zealand’s “100% Pure New Zealand” image, and what is his response to The Economist, which says that his proposals make New Zealand’s promotion in an area like the Shanghai Expo 2010 an exercise in hypocrisy.
Hon GERRY BROWNLEE: There are a couple of things that we should recognise. Firstly, Tourism New Zealand uses Blue Lake in Central Otago with the “100% Pure New Zealand” logo over the top to promote tourism. That lake is only there because of previous mining activity on the side, which is quite interesting.
Hon Phil Goff: Oh, no!
Hon GERRY BROWNLEE: Oh, I see. So old-fashioned mining that does all the damage can now be used to promote New Zealand tourism; that is Phil’s position. Secondly, I note that Australia, Canada, and other countries around the world do not have a problem in attracting tourists, even though they promote their mining sectors very vigorously.
Budget 2010—Main Focus
2. DAVID BENNETT (National—Hamilton East) to the Minister of Finance: What will be the main focus of the Budget on 20 May?
Hon BILL ENGLISH (Minister of Finance): The Budget will be about the many, not the few. [Interruption] But seriously, New Zealand has come through the recession in reasonable shape, and the Budget will focus squarely on building the recovery so New Zealanders can get ahead. It will set out a credible plan to achieve faster and more sustainable economic growth after 9 years of the economy underperforming under the previous Labour Government.
David Bennett: How will the Budget help hard-working New Zealand families get ahead?
Hon BILL ENGLISH: The Budget will focus on two things that will help hard-working New Zealand families get ahead. There will be a reform of the tax system, so that it will be fairer and will provide the right incentives for good choices for the economy. It will also focus on getting better value for the large amount of taxpayers’ money spent on public services, and that will include getting rid of ineffective programmes left over from the last Government and redirecting that spending to high-priority programmes.
Hon David Cunliffe: When the Minister said that the Budget would be about the many, not the few, did he mean the many increases in costs New Zealanders can expect, in addition to increasing taxes on all the basics, increasing the costs of university and polytech, increasing the costs of childcare, and increasing the costs of home help; and when will we get a Budget focused on creating jobs?
Hon BILL ENGLISH: I meant the many people who are relieved that the dreadful economic management of Labour has come to an end at just the time when New Zealand needs competent economic management to get through this recession. [Interruption]
Mr SPEAKER: The member was obviously indicating to me that I should have objected to the Minister’s answer, but when he asked the Minister what he meant, he inserted a whole lot of statements. The Minister answered with what he meant, and the member may not have liked it particularly.
David Bennett: How are early signs of economic recovery being reflected in the latest labour market trends?
Hon BILL ENGLISH: A couple of trends are evident. Firstly, it appears unemployment is approaching a peak. We are not quite sure whether it has reached it yet. Secondly, official statistics confirmed this week show that the number of hours worked by New Zealanders is picking up. Total hours worked increased by 1.1 percent in the latest March quarter. That is one of the reasons unemployment will fall only slowly. Many New Zealanders took a cut in hours in order to get through the recession, and, now the economy is picking up, they will increase their hours of work, rather than new jobs necessarily being created immediately.
David Bennett: What kinds of economic policies would threaten New Zealand’s recovery and destroy jobs?
Hon BILL ENGLISH: The biggest threat to our recovery would be policies that featured a mix of soaring debt, higher taxes, and never-ending Budget deficits. That is precisely the scenario that the National Government inherited in late 2008 before the global financial crisis. It is unfortunate that those remain the policies of the Labour Party.
Employment Policies—Reports on Success
3. Hon ANNETTE KING (Deputy Leader—Labour) to the Minister for Social Development and Employment: What advice has she received on the success of the Government’s employment policies?
Hon PAULA BENNETT (Minister for Social Development and Employment): I have received a lot of advice commending us for our commitment to addressing the recession’s effect on employment, particularly the employment of young people.
Hon Annette King: Does she agree with the comment that young people are being impacted very seriously by the recession; if so, how many of the 72,000 unemployed young people have been assisted by her employment package, which the Government claimed would address the impact of the recession on young people?
Hon PAULA BENNETT: I will take just one part of the youth jobs package. Under Job Ops and under Community Max, more than 8,000 young people have come off the unemployment benefit—a very different number from the one the member bandies around. I think that is really positive.
Hon Annette King: Has she seen the latest figures on her employment initiatives, which show that in Auckland, where there are 26,000 unemployed young people, a mere 1,800 have been helped by the package she has just talked about; on the East Coast, where there are over 5,000 unemployed young people, a mere 629 got assistance; and in Canterbury, where there are almost 10,000 young people out of work, 760 kids got some help from her package—and the pattern is repeated all over New Zealand—and is her enthusiasm for the package an example of her statement at the weekend that she is “a girl prone to excesses”?
Hon PAULA BENNETT: When it comes to getting people into jobs, then, yes, I think we are prone to excesses. We are seeing more young people in employment who would have been on an unemployment benefit if not for this Government’s Job Ops package. We have more people going through straight-to-work initiatives. We have more people in industry partnerships. We have put $69.2 million extra, through just Work and Income, into helping people into jobs. I think this package is responsive and responsible.
Hon Annette King: What explanation has she given to the Prime Minister as to why her employment initiatives have failed to stem the rise in youth unemployment, which is now at its highest level since June 1993, in light of his statement that he did not want to see a repeat of the impact of the recession of the early 1990s on young people?
Hon PAULA BENNETT: The Prime Minister particularly congratulates those who work at Work and Income. When we look at all the projections for what unemployment benefit levels would be, we see that we are well beneath all of them. When we look at the projections from Treasury, from all the economists, from the Half Year Economic and Fiscal Update, from everything else, we see that we are below those projections, and we are bringing down the number of unemployed.
Todd McClay: Is the Minister aware of any feedback on the success of the Youth Opportunities package?
Hon PAULA BENNETT: Yes. The Mayors Taskforce for Jobs wrote to the Prime Minister: “The Youth Opportunities package you announced in August 2009 has been invaluable in providing opportunities for our young people and mitigating the worst effects of the recession.” I even have a quote that says: “I’m delighted that someone is getting our younger generation motivated to contribute to our district again.” That quote was from Clayton Cosgrove. He was saying that he was delighted with Community Max.
Hon Annette King: Did she toss Treasury’s advice on her employment package that it would “likely have limited impact” and would “represent poor value for money” into her “who-gives-a-damn bin”, the place she said she puts advice she does not agree with; if so, will she take Treasury more seriously in future?
Hon PAULA BENNETT: The quotes the member keeps referring to are from a letter to the editor. I note that she has yet to have one published, so she is quoting mine now, which is kind of cute. I can table the letter, if the member wishes. She can frame it, given that she obviously likes it so much. When it comes to Treasury advice, I am not the first Minister to disagree with it and I am sure I will not be the last. If we had taken its advice, we would not have over 8,000 young people engaged in these programmes. We have had to keep extending these programmes, quite frankly, because they are going so well.
Catherine Delahunty: Tēnā koe, Mr Speaker. Which Peter Saunders did she intend to appoint to advise the Welfare Working Group on welfare and employment: the Peter Saunders whose book Welfare to Work she cited in the House last week, or the Peter Saunders she actually appointed, who thinks there is a link between low class and low intelligence? Is she aware that they are actually two different people?
Hon PAULA BENNETT: I do not see how that is relevant to the actual—[Interruption]
Mr SPEAKER: I apologise to the Minister. A question has been asked. If members want to hear the answer, they need to be a bit more reasonable with the noise level.
Hon PAULA BENNETT: I will say exactly what I said last week: some of the advice and comments from Treasury I agree with, and some I do not. I am not so narrow-minded that I will pick out only the bits I agree with; I will listen to all of them and make a decision from there.
Catherine Delahunty: I raise a point of order, Mr Speaker. Which one did she intend to appoint?
Mr SPEAKER: The member’s question was so long and convoluted that the Minister picked up on one piece of it, and she is entitled to do that. If the member wants a question answered seriously, it has to be short and concise, or the member gives the Minister a chance to pick up any bit of it.
Hon Trevor Mallard: Mr Speaker, I do not like disagreeing with your ruling, but I think the question was a relatively simple question: was it the Peter Saunders who said this, or the Peter Saunders who said that? The member indicated that there were two different Peter Saunders, and the question was which one the Minister had intended to appoint. It was not complicated. Disagreeing with one of the statements, or agreeing with it, actually did not address the question, which was which of those two people she meant to appoint. It appears from what was said in the House last week that she has appointed someone she did not mean to.
Mr SPEAKER: The member is now—[Interruption] I do not need to have any further assistance on it. The member’s kind clarification has shown that the question was barely in order because it was so far removed from advice on employment policies. Which person she might have appointed somewhere bears virtually no relationship to the primary question.
Hon Trevor Mallard: I raise a point of order, Mr Speaker.
Mr SPEAKER: I have dealt with the matter.
Hon Trevor Mallard: I raise a point of order, Mr Speaker. I think the point you may have missed, because it was about employment matters, was the purpose of Ms Bennett’s appointment.
Mr SPEAKER: The primary question asked the Minister what advice she had received. The supplementary question from Catherine Delahunty asked her which person she had appointed to something; it was totally irrelevant to the primary question. I was being kind in not ruling it out, and to expect me then to insist on the Minister answering a particular aspect of it is not reasonable.
Hon Sir Roger Douglas: How can she justify telling a young person offered a job as a trainee landscaper with a productive value of $400 a week that the young person is not allowed by law to take that job, and must instead go on a benefit of just $160 a week?
Hon PAULA BENNETT: I am sure that I have never told a young person that he or she is not to take a job and, instead, is to go on the benefit. I am not sure what the member is referring to.
Hon Sir Roger Douglas: It is very clear that there is a minimum wage of $510—
Mr SPEAKER: I beg the member’s pardon. Is this a point of order or is it a supplementary question? It has to be one or the other. He is an experienced member.
Hon Sir Roger Douglas: I raise a point of order, Mr Speaker. It is very clear what the question was about. Someone was offered a job at $400 a week. The Minister for Social Development and Employment would clearly know that the minimum wage is $510 a week, and that is why, by law, this young person could not take the job. I was asking the Minister how she could justify that.
Mr SPEAKER: I invite the member, because his party has a limited number of supplementary questions, to reword his question to make it consistent with the primary question. The primary question asked the Minister what advice she had received on the success of Government employment policies. I invite the member to rephrase his question to make it in order and consistent with the primary question.
Hon Sir Roger Douglas: Is it not obvious to the Minister that she would have more success in terms of unemployment numbers if she allowed a young person to take up the offer of a job paying $400, and did not insist that, instead of that person taking up that job paying $400, he or she had to go on the unemployment benefit because of the minimum wage rules that she operates under?
Hon PAULA BENNETT: No.
Catherine Delahunty: I seek leave to table two documents. The first relates to the biography of Professor Peter Saunders and it is from the University of New South Wales website.
Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is objection.
Catherine Delahunty: I seek leave to table another document. It relates to the biography of Professor Peter Saunders from the Centre for Independent Studies, and it is from the Welfare Working Group website.
Mr SPEAKER: Leave is sought to table the document. Is there any objection? There is objection.
Hon Sir Roger Douglas: What is more important to her: young people getting jobs, or pandering to the left? [Interruption]
Mr SPEAKER: I am on my feet. There were transgressions from all around the House, so I cannot do much about them. I say to the Hon Sir Roger Douglas, who has been in the House longer than I have, that the question must relate to the primary question. The primary question was very clear. It asked “What advice …”. The member managed in his previous supplementary question to focus on the success of the Government’s employment policies. I invite him again—because his party has only a limited number of supplementary questions—to reword his question to make it in order and consistent with the primary question.
Hon Rodney Hide: I raise a point of order, Mr Speaker. I find your ruling a bit perplexing and I draw your attention to what the primary question exactly is. The question states: “What advice has she received on the success of the Government’s employment policies?”. The ACT Party was assuming that the success of the Government’s employment policies was measured in people getting jobs, which is exactly what Sir Roger Douglas was talking about. It is the success of the employment policies that we are discussing.
Mr SPEAKER: It is not difficult to phrase a question that seeks the information the member wants but is more consistent with the primary question. I invite the Hon Sir Roger Douglas to do that, if he wishes. He does not wish to do so.
Genetic Engineering, AgResearch—Names of Members of AnimalEthics Committee
4. SUE KEDGLEY (Green) to the Minister of Agriculture: What are the names of the members of the animal ethics committee that approved the experiment at AgResearch’s Ruakura facility in 2009, which resulted in genetically engineered calves carrying human genetic code whose ovaries grew so large that they ruptured and killed the animals?
Hon Dr WAYNE MAPP (Minister of Defence) on behalf of the Minister of Agriculture: The Minister will not name the individuals on any animal ethics committee, as to do so could potentially put the individuals and their families and property at risk. Members of animal ethics committees must include senior members of the organisation, in this case AgResearch; an independent veterinarian; an SPCA representative; and a person nominated by the local territorial authority. The Minister does not want to deter individuals with an interest in expertise and animal ethics from putting their names forward in this important role.
Sue Kedgley: Why should it be left to one committee, whose membership is secret and which meets in secret, to decide on the significant animal welfare and ethical issues involved in creating genetically engineered animals with human genetic material in them?
Hon Dr WAYNE MAPP: I just want to restate the actual membership of this committee, to indicate its balance. First, it has a member of the organisation itself, a senior member. Second, it has an independent veterinarian. Third, it has a member of the Society for the Prevention of Cruelty to Animals; and, fourth, a person nominated by the local territorial authority. It is worth noting that the question is about animal ethics, and I would have thought that the membership of the committee accurately reflects the member’s concerns.
Sue Kedgley: Does he agree the public has a right to be consulted about the ethical and animal welfare implications of inserting human genetic material into animals and fundamentally altering their nature and properties?
Hon Dr WAYNE MAPP: In effect, this is all dealt with by the Environmental Risk Management Authority, which has a process involved in it, and it is very extensive, as the member knows. So it is not the ethics committee itself that deals with the original application; it is actually the Environmental Risk Management Authority that deals with the original application, which gets to the point that I think the member is raising.
Sue Kedgley: I raise a point of order, Mr Speaker. I asked a very carefully phrased and very specific question—whether he agrees the public has a right to be consulted about these issues, yes or no.
Mr SPEAKER: I invite the Minister to reply a little more. I am sure the Minister can answer that question; I invite him to do so.
Hon Dr WAYNE MAPP: The specific reason I mentioned that the Environmental Risk Management Authority processed it is that that is an extensive process. In respect of the precise methodology as to how the authority conducts its inquiries, I am not entirely clear whether it has a public component but my recollection is that it does. I would need to verify that.
Sue Kedgley: Given that the Environmental Risk Management Authority does not consider ethical and animal welfare issues, who is responsible for ensuring there is a public debate about the ethical and animal welfare implications of genetically engineered cross-species animals, now that the organisation previously responsible for this work—namely, the Bioethics Council—was axed by the Key Government, in March last year?
Hon Dr WAYNE MAPP: Can I note at this point that the Minister of Agriculture, when he became aware that the calves had died, immediately sought advice from the Minister of Agriculture and Fisheries on the animal welfare implications. He was satisfied that the advice from the ministry was that the National Animal Ethics Advisory Committee had acted properly and in accordance with the Animal Welfare Act 1999. So it was considered that the advisory committee did properly deal with the issues raised by the member.
Sue Kedgley: I raise a point of order, Mr Speaker. Again it was a very simple, straightforward question: who is responsible for ensuring there is a public debate, now that the Bioethics Council has been disbanded. The Minister was obviously reading some answer to a question but I think it was the wrong question that he was seeking to answer, and I respectfully ask whether he could answer my question.
Mr SPEAKER: I ask the Minister, having heard the member’s question again, whether he could answer a little more precisely to what the member is asking him—I realise it is not easy for a member answering on behalf of a Minister—if he has the information. He may not have the information; one has to be reasonable on these matters.
Hon Dr WAYNE MAPP: I in my capacity as Minister of Research, Science and Technology will be seeking a report on the results of this particular programme—
Hon Darren Hughes: I raise a point of order, Mr Speaker. The Minister is answering on behalf of another Minister. He is not the Acting Minister; I do not believe that the Minister is out of the country. He is not answering in his own stead as the Acting Minister of Agriculture; he is answering on behalf, so he cannot start giving an answer about what he is doing in another portfolio. Interesting though that might be, it is not in order.
Mr SPEAKER: The member’s point is perfectly sound. The Minister should be answering on behalf of the Minister of Agriculture. It may be that the Minister does not have the necessary information but he should try to answer the member’s reasonable question.
Hon Dr WAYNE MAPP: The Minister of Agriculture has been advised by the Minister of Research, Science and Technology that a report will be sought from Sir Peter Gluckman, the Prime Minister’s Chief Science Adviser, who is an acknowledged expert on growth and development and these issues. I believe that that report will deal with some of the concerns being raised by the member.
Sue Kedgley: I raise a point of order, Mr Speaker. Please, I seek your protection on this issue. I asked who—[Interruption]
Mr SPEAKER: Members know that points of order should be heard in silence, even if they do not like them. However, I say to the honourable member that, in fairness, as Speaker I have asked the Minister on two occasions to give a more precise answer; I do not believe I can do more. I think the member needs to go on to her next supplementary question, because quite clearly the Minister does not have the information.
Sue Kedgley: I raise a point of order, Mr Speaker. I asked who is responsible for ensuring a public debate, now the Bioethics Council has been disbanded. That is an incredibly simple question. Is the answer “nobody”?
Mr SPEAKER: The member must not get into debating the issue. I have asked the Minister, on two occasions now, to give a more precise answer to the member’s question; I do not believe we can take up more time of the House. Clearly the Minister does not have the information.
Hon Dr WAYNE MAPP: Mr Speaker—
Mr SPEAKER: Is this a point of order?
Hon Dr WAYNE MAPP: Adding to the answer.
Mr SPEAKER: I—[Interruption] I am on my feet. I ask the Hon Shane Jones for a little decorum, please. I am getting a little frustrated here. I have asked the Minister on two occasions, when the member has repeated what information she was seeking in a reasonable question, to provide the information. Is the Minister, after refusing on two occasions to do that, now telling us he has the information and wishes to answer the question? Is that what the Minister is trying to say? I invite him to do that if he has that information.
Hon Dr WAYNE MAPP: I was going to add to my answer in a way that I believe would assist the member’s question. It is obviously possible for the member to make submissions to Sir Peter Gluckman. That is the way these kinds of issues can be debated.
Sandra Goudie: What action is the Government taking in respect of this research?
Hon Dr WAYNE MAPP: As I have indicated, the Minister of Agriculture has been informed by the Minister of Research, Science and Technology that Sir Peter Gluckman—the Prime Minister’s Chief Science Adviser, who is an acknowledged expert on these issues—is to make a report. Indeed, I am sure the member will make submissions to Sir Peter on this issue.
Sue Kedgley: Does he agree that the experiment went horribly wrong, and can he guarantee that no further trials of this nature will be carried out in New Zealand?
Hon Dr WAYNE MAPP: The Minister certainly does understand that the experiment went wrong, which is precisely why he sought a report from the Ministry of Agriculture and Forestry when the issue came up, as did the Minister of Research, Science and Technology from the Prime Minister’s Chief Science Adviser. On the second point the member raised, obviously the Minister of Research, Science and Technology will have raised those issues directly with the chair of AgResearch.
Sue Kedgley: Does he agree that the deformities in the calves were quite horrific, and that most New Zealanders would be shocked at what has been going on behind closed doors at the Ruakura Research Centre?
Hon Dr WAYNE MAPP: In relation to the second point, these activities do not go behind closed doors, as such; the fact that it was occurring was public. I agree that New Zealanders would have found this horrific and very perturbing.
Wage Growth—Reports
5. Hon DAVID CUNLIFFE (Labour—New Lynn) to the Minister of Finance: What reports, if any, has he received on recent wage growth?
Hon BILL ENGLISH (Minister of Finance): This week I have seen two reports. The quarterly employment survey showed that the total weekly paid hours worked increased by 1.1 percent in the March quarter. This follows the recession that started in early 2008, which forced many businesses to reduce staff working hours. That trend is now starting to reverse. Secondly, the Labour Cost Index shows that public wage and salary rates increased by 2.3 percent in March quarter, which is nearly double the 1.3 percent increase in the private sector.
Hon David Cunliffe: When unemployment is at a 16-year high and wage growth is at its lowest in almost 9 years, why is Budget 2010 focused on increasing GST and pushing up the cost of living for hard-working Kiwi families?
Hon BILL ENGLISH: Budget 2010 is following on from Budget 2009 in dealing with two things: first, the recession that started in New Zealand in 2008, under the previous Labour Government, before the global crisis; and, second, the very poor performance of this economy from about 2004 onwards, when it grew at less than 1 percent per year through what were meant to be the best economic conditions in a generation. So we have to undo the damage of the squandered opportunities under that Government, and deal with the global recession.
Amy Adams: What was the impact on average household incomes of New Zealand’s economic performance between 2005 and 2008?
Hon BILL ENGLISH: In the 3 years from September 2005 to September 2008 GDP grew on average by less than 1 percent per year. However, that figure was outstripped by annual population growth of 1.1 percent, meaning that the per capita growth in incomes during the last 3 years of the previous Government was actually negative when the rest of the world was booming.
Hon David Cunliffe: What other job opportunities are open to young, unemployed New Zealanders when the only job scheme the Government has announced—the cycleway—has failed to create any jobs, as predicted by Treasury; and is that what this Government means by back-pedalling?
Hon BILL ENGLISH: Well, the Labour finance spokesperson job might be available to them, as well—even for younger ones. The fact is that jobs are being created every week. Several thousand people a week are going off the unemployment benefit as the economy starts to recover. Budget 2010 will help to create the conditions where business has the confidence to invest and employ, because until or unless business makes that decision, there will not be a reduction in unemployment.
Amy Adams: How have incomes for New Zealanders on New Zealand superannuation, which are linked to average take-home wages, been affected by recent Government policy?
Hon BILL ENGLISH: Since 1 October 2008 a combination of tax cuts—initially, tax cuts put in place by the previous Labour Government, and then further tax cuts by this Government—has meant that New Zealand superannuation payments have increased significantly. For instance, the single rate for a person living alone has gone from $571 a fortnight to $636 a fortnight—an increase of nearly $65 in the hand per fortnight. For married couples, the increase per fortnight has been up to about $100 in the hand, or more than 11 percent, since 1 October 2008. We believe that policies that continue with adjustments in the tax system and promote economic growth will mean that New Zealand superannuation payments can continue to increase.
Hon David Cunliffe: How does the Minister reconcile his comment in the taxpayer-funded promo Plain English that “We can beat those Aussies!”, when New Zealand’s average wage has stalled at $959 and the Australian wage has raced ahead to $1,580?
Hon BILL ENGLISH: As I said, it will take us some time to undo the damage done by 9 years of misdirected economic policy.
Hon David Cunliffe: I raise a point of order, Mr Speaker. We traversed yesterday the boundary between a factual history of things that he is responsible for, actions under the previous Government, and his description of the policies of another party, which you ruled to be out of order yesterday. You gave him, I guess, wiggle room in that a passing reference might be allowed, but he started his response by talking about the Labour Party, and it does not appear there is any way out on this occasion.
Hon Gerry Brownlee: I think that reflection on the question will give a perfectly good reason as to why Mr English was perfectly free to start his answer in the way in which he did. The member over there referred to a taxpayer-funded television programme, about which Mr English had made a particular promotional point. At that point the member asked him “How does he reconcile” and then compared wage rates in Australia with those in New Zealand. If we analyse it right down, there was no clear question whatsoever. If, in fact, “How does he analyse” or “How does he reconcile” was the question, then Mr English was quite free to reply in the way in which he did.
Mr SPEAKER: I have heard quite sufficient. I have to agree with the Hon Gerry Brownlee. If the member wants Ministers to not deviate from absolutely straight answers, the member has to discipline himself by not putting elaborate constructions into his questions.
Health Services—Minister’s Statements
6. Dr PAUL HUTCHISON (National—Hunua) to the Minister of Health: Does he stand by all of his recent statements on health services?
Hon TONY RYALL (Minister of Health): Yes, including the statement that Waitemata District Health Board is improving front-line services for patients in its area. For example, last year an extra 1,045 patients received elective surgery compared with 2008, which is an increase of 8 percent, and almost 2,000 extra patients received an appointment to see a surgical specialist, which is an increase of 10 percent. We are certainly delivering more for people in that area.
Dr Paul Hutchison: What further reports has he received of improved front-line services being delivered at Waitemata District Health Board?
Hon TONY RYALL: I can advise the House that the $1.7 million refurbishment of Waitakere Hospital’s emergency care centre is now under way, which will bring full 24/7 emergency care services a step closer for the 220,000 people of west Auckland. When Minister and local MP Paula Bennett and I visited the hospital recently, we saw the site of an expansion in the number of paediatric beds at that hospital, and I can advise that, this weekend, work will start on providing an additional seven short-stay paediatric beds at the hospital. By way of example, over the whole district health board, general surgery is up by 10 percent, and ear, nose, and throat surgery is up by 14 percent.
Hon Ruth Dyson: How will his statements help the people of Tararua, who are facing big health cuts, and where a cancer support worker is reported as saying: “This is just the start. Already we’re facing more calls for our services as funding cuts hit our area.”, and where health professionals say that the cuts to rehabilitation services and the axing of night coverage by the district nursing service will put even more strain on families, on carers, and on volunteers?
Hon TONY RYALL: With respect to the night services being discussed by the member, there will be alternative services available for the people there. The people of the MidCentral District Health Board have had additional funding—
Hon Ruth Dyson: Like what?
Hon TONY RYALL: Like what? Like the $300,000 extra given to the local hospice.
Dr Paul Hutchison: What other services are being improved at Waitemata District Health Board?
Hon TONY RYALL: I am advised that a new renal service is being put in place at Waitemata District Health Board. Presently, around 220 patients are on dialysis, and they are treated in central Auckland, meaning that Waitemata District Health Board patients must travel long distances three or four times a week for 4 to 6-hour dialysis sessions. The new service, which is to start next year, will see existing patients transferred to Waitemata District Health Board and all new patients treated locally. At North Shore Hospital, a new medical ward will open next month, and a new chronic pain service will be starting very shortly.
Hon Ruth Dyson: Why does he continue his parallel reality in which there are no cuts, when, every day, I am alerted to new health cuts around New Zealand, which will get—
Mr SPEAKER: I apologise to the member. Forgive me, but I just cannot hear the member’s question. The House has been particularly noisy today. I do not mind noise where opinions are very strongly held, but the member is just asking a question.
Hon Ruth Dyson: Why does he continue his parallel reality in which there are no cuts, when, every day, I am alerted to new health cuts from around New Zealand, which will get even worse when his much-lauded $536 million of new money will be dramatically reduced in the 2010 Budget?
Hon TONY RYALL: This Government can show that we are delivering more front-line services for New Zealand than the previous Government was ever able to do. We have certainly seen today that the Waitemata District Health Board is providing many more services for the people in that community.
Hon Ruth Dyson: I seek leave to table the Midlands region newsletter of the New Zealand Nurses Organisation from the last quarter of last year, which quotes David Bennett and Tim Macindoe stating that New Zealand is now a Second World country, and that, as such, we can expect only Second World care—
Mr SPEAKER: Leave is sought to table that document. Is there any objection? [Interruption] Members know that when a point of order is being considered, they must be silent. I ask how I am meant to hear whether there is any objection to the leave being sought when there is so much noise. If members make that kind of interjection, then I may draw the wrong conclusion.
Leave is sought for that document to be tabled. Is there any objection? There is objection.
Education, National Standards—Minister’s Statement
7. Hon TREVOR MALLARD (Labour—Hutt South) to the Minister of Education: Does she stand by her statement in regard to national standards that “There will be no concessions, there will be no trial period.”?
Hon ANNE TOLLEY (Minister of Education): Yes, and I also stand by the next part of that quote: “Parents want National Standards and they are going to get them from next year. There will be constant evaluation, the tenders are just being let, and if adjustments need to be made, then that will happen.”
Hon Trevor Mallard: Does she agree with the statement that “the trials are an important step that allow standards and internal assessment resources to be road-tested with actual students before being implemented”?
Hon ANNE TOLLEY: From memory, that quote comes from the New Zealand Council for Educational Research’s submission as part of the consultation on national standards last year. It made three main points. Two of them we totally agreed with. In fact, the council agreed totally with the national standards and the way in which they are being implemented, and it was very complimentary. The third point related to the timing of the implementation. Its recommendation was that we have a national road test for 12 months. As I say, that was one submission; 11,000 submissions were made during the consultation period. I think that our agreement on two areas out of three was not bad.
Hon Trevor Mallard: Was the Minister aware that the statement I just quoted came not from the New Zealand Council for Educational Research but from last week’s edition of her Education Gazette on how to develop quality standards?
Hon ANNE TOLLEY: As I stated in my previous answer, from recollection that quote was indeed part of the New Zealand Council for Educational Research’s submission during the consultation period last year. That was its recommendation. I am on record as saying that we are happy to have this year with the standards as a bedding-in year. I think that whether one describes it as a bedding-in year or a road test, they are pretty close. I think that it is very good to have a research organisation like the New Zealand Council for Educational Research onside with national standards.
Colin King: Why did the Government not have a trial period for national standards?
Hon ANNE TOLLEY: This Government was elected with a very clear mandate from parents to introduce national standards to ensure that their children were being assessed against nationally consistent benchmarks and to ensure that parents received reports in plain language about their child’s progress. I have seen all sorts of suggestions for trials—for example, one suggestion would involve a 5-year trial of the standards. I can put it no better than one parent, who attended one of the national standards meetings around the country, who said: “Why should my children have to wait any longer?”.
Hon Trevor Mallard: Why does her Ministry of Education, under her direction, consider it vital to trial minor changes to the National Certificate of Education Achievement (NCEA) but not vital to trial national standards?
Hon ANNE TOLLEY: There is such a difference between NCEA and national standards. NCEA has been in schools since early in the 2000s, and there are very high stakes for students because it represents national qualifications. In NCEA we have a consistent process of improvement. That is exactly what I have said will be in place for national standards. We will constantly improve them, because they are not about systems; they are about kids and their educational success.
Hon Trevor Mallard: Why is it vital to trial minor changes to NCEA but not vital to trial her new national standards?
Hon ANNE TOLLEY: I have just answered that.
Mr SPEAKER: If the member feels that his question was not answered to his satisfaction, he is entitled to use a further supplementary question to ask the same question again. I guess that if the Minister says that she has answered the question, then that is a reasonable answer. Members can make their judgments about the adequacy of the previous answer.
Student Loans—Changes to Administration Fees
8. ALLAN PEACHEY (National—Tāmaki) to the Minister for Tertiary Education: What changes is the Government considering to make administration of the student loan scheme more cost effective?
Hon STEVEN JOYCE (Minister for Tertiary Education): The Government is looking to recover more of the $40 million per year it costs to administer the student loan scheme. Currently, only $10 million is recovered from students through the $50 charge per year, which takes place while a loan is being drawn down. That charge has not been changed since 1992. Once borrowers leave tertiary education, they do not pay any of the administration costs of the scheme, at all. It is only fair that borrowers who receive the benefit of interest-free loans cover more of the actual costs of loan administration, so more people have the opportunity to participate in tertiary education.
Allan Peachey: What would this extra money be used for?
Hon STEVEN JOYCE: Money currently spent on subsidising student loan administration costs could be freed up to invest back into more places at tertiary institutions. This year we are funding a record number of student places in New Zealand tertiary institutions, but this is currently projected to decline next year, partly as a result of the previous Government’s projection for student numbers to fall as a result of the global economic recession. Final decisions will be detailed in the Budget later this month.
Hon Maryan Street: How does he reconcile the addition of a $50 fee on any person with a student loan with last year’s Government legislation offering a 10 percent bonus on any additional loan repayment of $500 or more—which is about $50 in my maths—or is the Government seeking to recover the cost of its own legislation by giving with one hand and taking away with the other?
Hon STEVEN JOYCE: I think that 10 percent of a student loan repayment could be any amount of money; it depends on who pays it back. I think it is entirely fair, though, that the administration—
Hon Maryan Street: No—the bonus legislation.
Hon STEVEN JOYCE: Yes, the bonus is 10 percent of the overpayment—that is what it is. I think it is quite fair for administration costs of the scheme to be met by those who participate in it. I think it is entirely fair. There will still be the bonus for early repayment, which they will receive on top of that.
Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill—Government Support
9. DARIEN FENTON (Labour) to the Minister of Labour: Will the Government support the Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill to select committee so that New Zealand workers and business can have their say on the adequacy of current redundancy laws?
Hon KATE WILKINSON (Minister of Labour): No.
Darien Fenton: What then does she have to say to warehouse supervisor Rod Highsted, who is one of about a dozen workers at TA Macalister laid off this week without any redundancy payment after 20 years’ service?
Hon KATE WILKINSON: For anybody who loses his or her job, it can be a very upsetting experience. I certainly sympathise with them. That is why our Government has made sure we are taking every step we can to get the economy growing again and help laid-off workers into new jobs.
Darien Fenton: What does she have to say to Annie, an information technology worker who emailed me this week, who was made redundant just before Christmas without redundancy pay and who has lost her house, all of her savings, and practically all of her furniture because she had nothing to tide her over while she looked for another job?
Hon KATE WILKINSON: I repeat what I said in my previous answer, but redundancies are never nice. People are losing jobs, small-business owners are losing their livelihood and often their homes, and adding more rules and regulations to this does not make it any fairer.
Darien Fenton: What does she have to say to Telecom engineers such as Jonathan Smith who were made redundant through no fault of their own in the middle of one of New Zealand’s highest periods of unemployment, with no redundancy pay to help them get through the hard times until they found more work?
Hon KATE WILKINSON: I reiterate what I said in the previous two responses.
School Trustee Elections 2010—Closing Date for Voting
10. JO GOODHEW (National—Rangitata) to the Minister of Education: When is the last day for parents to vote in the 2010 school trustee elections?
Hon ANNE TOLLEY (Minister of Education): For the vast majority of schools, voting in the 2010 school trustee elections closes at noon this Friday, 7 May. Parents at schools with more nominations than positions should have their voting forms and I encourage them to vote in these elections for the parent representatives who will govern their children’s school for the next 3 years.
Jo Goodhew: What reports has she received on the number of schools with too few nominations in the 2010 school trustee elections?
Hon ANNE TOLLEY: I am delighted to say that reports I have received state that across the country only three schools have had insufficient parent representative nominations. That compares very favourably with the 2007 elections, which saw five schools with insufficient nominations. Commissioners will be put in place on a temporary basis for those schools until a new election process can take place. This strong nomination turnout shows that parents are interested in taking part in the governance of their local schools, and I am particularly pleased that parents have ignored the calls of Mr Mallard to think twice before they consider standing for boards of trustees. It shows that parents are paying as much attention to the Labour Party on this one—
Hon Darren Hughes: I raise a point of order, Mr Speaker. Ordinarily we would appreciate full and long answers from the Minister, but for this question, which is an informational one, the answer is now turning into a speech.
Mr SPEAKER: I think that was a fair point. Indeed, I think we have had enough of it—[Interruption] Could members make sure they rise and call? Today the noise level in the House means either I need to get my ears tested or the noise level is too high. It is very difficult to hear. Members need to get to their feet reasonably promptly or I cannot pick them up. I apologise to Rahui Katene, who has a supplementary question.
Hon Gerry Brownlee: I raise a point of order, Mr Speaker. I apologise to the member. The comment you just made about the noise levels in the House is pretty relevant. Sometimes members miss an opportunity to take a call. We have had a little bit of that lately; indeed, I think it is largely due to the sound system, which is still not working well in this House. It is unfortunate that we keep getting reports to us stating that it is the best thing since sliced bread and that there has been a significant amount of money spent on it, but it continues to be something that is very, very difficult for members to work with. I have been approached by members of our own backbench who even on a quiet day find it difficult to hear members at the front of the Chamber speaking.
Mr SPEAKER: It is an important issue. I will hear the Hon Peter Dunne, but I do not want to spend too much time on it. I am acutely aware of what the Leader of the House has just said.
Hon Peter Dunne: I endorse Mr Brownlee’s comments. I think that although today there has been a higher level of noise than usual—in this corner of the House, anyway—the problem is that the noise comes through at a constant level. When we get someone with a louder voice than usual—for instance, when Mr Brownlee was answering questions previously—we might expect it to carry. What is often carried down to this end of the Chamber is the constant hubbub, and we cannot hear the individual speaker over that hubbub. I have had difficulty hearing you and members on that side of the House at times today. When we had the system that was individualised to the seats, the individual sound of a voice came through. When we went for these stalactites, or whatever they are called upstairs, we lost that. I think the consequence has been that it is harder for people to hear and this has contributed to a general level of disorder.
Mr SPEAKER: I think that both members make very good points. I am acutely aware that members in the back rows of the House cannot hear even in good times. I assure members that I will pursue this matter again. Members will recollect that I sought approval at one stage to enable technicians to come into the House during question time so they could hear what was going on. Again, I will seek the indulgence of the House for that because we must solve this problem. I am struggling to hear and members at the back of the House cannot hear. This is a very serious problem. The point the Hon Peter Dunne just made is true; it leads to disorder. When members cannot hear what is going on, there tends to be more noise and difficulty all around. I promise members I will pursue it again, because it is not good enough.
Rahui Katene: What strategies are being employed to ensure that boards of trustees are representative of their communities, including the representation of mana whenua?
Hon ANNE TOLLEY: Boards of trustees are self-governing entities, and there are no specific initiatives to encourage the representation of mana whenua. When voting, school communities will no doubt look to put in place governance that is in the best interests of the school. That may very well include people with links to local iwi. The Education Act 1989 allows boards of trustees to co-opt members. The Act requires that in doing so, they take into account the ethnic diversity of the school population and the character of their community.
Research and Development—Tax Credits or Equivalent Incentive
11. DAVID SHEARER (Labour—Mt Albert) to the Minister of Research, Science and Technology: Is the Government reconsidering the question of tax credits or an equivalent incentive for research and development?
Hon Dr WAYNE MAPP (Minister of Research, Science and Technology): The Prime Minister said in his statement to Parliament on 9 February that science and innovation and how they underpin business opportunities are so important for this Government that “we have made science and innovation a priority for new spending in this year’s Budget, and we are focused on boosting business research and science capability.” The member will have to wait for Budget announcements for the actual decisions.
David Shearer: Does he agree with the Prime Minister’s Chief Science Advisor, Professor Gluckman, who said at a select committee today that we need a significant shift in private-sector research and development spending; if so, what actions has he taken to achieve that?
Hon Dr WAYNE MAPP: I think it is widely agreed that business does need to invest more in business innovation. As I said, there are Budget announcements ahead that will deal with some of these issues.
Louise Upston: What initiatives has the Government undertaken to support science and innovation since the 2009 Budget?
Hon Dr WAYNE MAPP: The Government has done a number of things. Firstly, the Government appointed Professor Sir Peter Gluckman as the Prime Minister’s Chief Science Advisor. Secondly, it realigned the funding system with its economic growth priorities. Thirdly, it has implemented the recommendations of the Crown Research Institute Taskforce, which was very well received. Fourthly, it is merging the Ministry of Research, Science and Technology and the foundation into a new agency to administer science policy and funding. Fifthly, it has established the Prime Minister’s Science Prizes. And there is more to come.
David Shearer: Does he share the concerns of Dr Andrew West, the chief executive officer of AgResearch, who said: “There’s been a lot of talk about extra money in last few years but there’s been no serious allocation from the Primary Growth Partnership.”, and said, following the recent loss of 36 AgResearch jobs, that “Jobs will also go in dairy foods, food safety, parasitology, reproductive biology ”, and I could go on; and how does he justify these delays in the Primary Growth Partnership?
Hon Dr WAYNE MAPP: Decisions will be made in relation to the Primary Growth Partnership. Of course, it is the responsibility of the Minister of Agriculture. In relation to the Ministry of Research, Science and Technology, the recommendations of the Crown Research Institute Taskforce deal with quite a number of the issues that the member has raised.
David Shearer: How much money have the various Crown research institutes received so far from the Primary Growth Partnership?
Hon Dr WAYNE MAPP: I will have to provide a precise answer to that. But the application process is really only just in train at the moment, because the applications have to be considered.
Toi Moko / Tattooed and Mummified Māori Heads—Repatriation from Museums
12. PAUL QUINN (National) to the Minister for Arts, Culture and Heritage: What recent progress has been made in efforts to secure the repatriation of toi moko from museums around the world?
Hon CHRISTOPHER FINLAYSON (Minister for Arts, Culture and Heritage): Earlier this morning, the Upper House of the French Parliament passed legislation enabling toi moko held in French institutions to be returned to New Zealand. That opens the door for Te Papa to approach museums in France and negotiate repatriation with them, with the ultimate objective of returning the toi moko to their communities. I express the Government’s gratitude to the French Government and to Minister Frédéric Mitterand, to whom the Hon Dr Sharples and I wrote last year on this issue, and to the French Parliament for passing this legislation.
Paul Quinn: How many toi moko are estimated to be held in French museums?
Hon CHRISTOPHER FINLAYSON: Estimates range from between 12 and 20. There are a number of museums, as well as the Université Montpellier, that have been identified as being likely to have toi moko in their collections.
Rahui Katene: How will iwi be actively involved in the negotiations and return of moko mōkai to their tribal rohe?
Hon CHRISTOPHER FINLAYSON: Te Papa will be holding them only on an interim basis. They are not accessioned as part of Te Papa’s collections. The museum has a policy prohibiting their exhibition. The goal of repatriation is to return the kōiwi to their communities of origin. Where it is possible to establish this, they remain in Te Papa’s custody pending return to their attributed place of origin. Discussions with iwi to this effect are ongoing as the repatriation of remains occurs.
General Debate
General Debate
Hon PHIL GOFF (Leader of the Opposition): I move, That the House take note of miscellaneous business. Kiwis do not ask for a lot, but they expect two things from a Government. They expect the opportunity to find employment and they expect to have a living wage so that at the end of the week their bills do not exceed the income that they earn. I have to say that on both of those fundamentals, Kiwi workers have gone backwards, not forwards, over the last year under this Government.
I went back and checked what our Prime Minister and our Minister of Finance said about employment this time last year. They boasted about the track record of New Zealand and about the low unemployment, which was inherited from a Labour Government, in comparison to what was happening in Australia. I ask members to listen to this from John Key: “I do know that New Zealand’s unemployment rate is 5 percent, and we can contrast that with the rate in Australia, which is 5.7 percent,”. He said that showed that National was doing a good job of holding down the unemployment rate in New Zealand. Then Bill English went a step further than that. He said that New Zealand was doing much better because the Government had the fiscal stimulus right. He said: “our fiscal stimulus has kept our unemployment rate down to 5 percent. So which one is it: copy Australia’s plan and force up the unemployment rate up, or stick to our plan and keep the unemployment rate lower?”
The problem was that there was no plan in New Zealand. However, there was clearly an effective plan in Australia. Kevin Rudd had a good stimulus package going to the whole of Australia. Research and development there is up 25 percent, and money is being invested in skills and training. What are the figures today after those boastful claims from John Key and Bill English? Australian unemployment is down to 5.3 percent; New Zealand unemployment is up to 7.3 percent. For the first time in a decade, New Zealand unemployment is running higher than Australia’s. It is one-third higher than Australia’s. What did we do in New Zealand? We had a Job Summit. Do members remember the three big ideas? One was the cycleway. I ask Mr Brownlee how many jobs have been created in the last 14 months in the building of that cycleway since that Job Summit. Does Mr Brownlee know the answer? It is zero; no jobs have been created, despite the fact that our unemployment has risen to 168,000.
Then there was the big employment package in August, which was rushed through so that John Key could announce it to the National Party conference. We wanted to find out what the thinking was behind that employment package. Radio New Zealand put in an Official Information Act request, and for 9 months National refused to respond to it. Today the information was released and New Zealand can see why National tried to cover up the information. Treasury said that the scheme represented poor value for money. Treasury regarded the $120 million scheme as poor value and was unlikely to increase long-term jobs. The jobs that were created by the 6-month short-term subsidies to employers disappeared when the subsidies went. The big package in August was an absolute failure.
There are 72,000 young New Zealanders out of work. The Government spends more money, but what about the fact that 37 percent of our teenage Māori and Pasifika kids are out of work, not in training, and not in education? That figure of 37 percent is a disaster waiting to happen. We had the mega-mining plan that was going to create jobs, but suddenly the plan has become modest.
Hon JUDITH COLLINS (Minister of Police): Phil Goff says that Kiwis do not ask for a lot or expect a lot. He would know that, because under 9 years of Labour Government they did not get a lot.
That is one of the things that have been turned around by this Government. In a couple of weeks’ time we will see Budget 2010, which will build on the marvellous results from 2009. When we came into Government we inherited an economy that was on the skids and a country that was already in recession. We took over from a Government that had been in office for 9 years, had built up debt, had built up expectations, but had left the kitty absolutely empty. That is what it did, and it did that at a time when it should have known that the country would be going through tough times because of a world recession. But instead of doom and gloom in the country, what actually happened last year was that a very straight course was run—something that Labour could never do. We went on a very straight course to make sure that as many Kiwis as possible stayed in jobs, and that as many people as possible stayed in work, so that they could in fact contribute to the economy and look after themselves. But what we had had under Labour was more borrowing—
Hon David Cunliffe: Tell us about Savoy? She doesn’t like that. She doesn’t want to talk about Savoy.
Hon JUDITH COLLINS: Mr Cunliffe, who is very noisy today, has an answer for everything. His answer is to borrow, borrow, and borrow, and when that is finished to borrow a bit more. It used to be “tax and spend” under Labour; now it would be “borrow and spend”. That is what Mr Cunliffe says. He says that New Zealand does not have a debt problem. Unfortunately, we have a debt problem caused by Labour when it was in Government, because it never saved so that it could spend wisely and invest to help people get into their own businesses and keep their heads above water. Instead, all that the previous Labour Government ever did was spend, spend, and spend, then borrow—
Hon David Cunliffe: It’s unravelling.
Hon JUDITH COLLINS: —I say to Mr Cunliffe—and borrow some more. Mr Cunliffe would like to see us like Japan. He would like to see us far into debt; that is what he wants. He is telling Bill English to borrow more and just put it on the card. Well, we all know about that, and we are looking forward to the payments on Mr Cunliffe’s cards becoming public in another month’s time. I say to Mr Cunliffe that I am really looking forward to that. I am looking forward to seeing what he was spending taxpayer dollars on; I have a lot to say about that. Mr Cunliffe does not like it when we talk about borrowing, does he? Not a lot! No, he does not like it.
Why is that? Mr Cunliffe is Phil Goff’s biggest enemy, and that is not just because he wants to be the leader of the party. It is because any thought of Mr Cunliffe being anywhere near Treasury would be enough to send Labour down to 18 percent in the polls, which is where it should be. Unfortunately, Mr Cunliffe is the Labour finance spokesperson, so about now Mr Goff must be wondering what he is doing.
In contrast to that, in Budget 2010 we will see some policies to lift New Zealand’s long-term economic performance—a performance that will continue to get better, time and time again. But it will not be an easy job. One of the things we are doing is bringing in more money from the back office into the front line, and we will see a readjustment in spending to make sure that that happens. That is something the Labour Government could never do. Labour’s idea of helping people was to build up the bureaucracy in Wellington and to forget about the people who paid the bills, but under National we will not see that.
Hon David Cunliffe: But what are you doing?
Hon JUDITH COLLINS: Mr Cunliffe asks what we are doing. Well, in the corrections area, which was left in the most appalling mess by Phil Goff, we are doing a public-private partnership. We are leading the way and doing something that Labour never had the backbone to do, which was to invest in our own people to help them get ahead and bring the economy forward. Labour could not do that because its whole answer was “borrow and spend”. All Mr Cunliffe has to say is “borrow and spend”. We will be undertaking that partnership while maintaining firm control over the Government’s finances, and it is extremely important that we do so. It would be very, very difficult just to continue on as we are. We will make sure that we get better productivity. Under 9 years of Labour, during the best economic times the world has seen, we had 1.1 percent growth in productivity. That is what the Labour Government had, but unfortunately the legacy it left us was debt.
Dr CAM CALDER (National): I raise a point of order, Mr Speaker. I just point out that I could barely hear the Minister in her speech. It was as if she were not even miked.
Mr SPEAKER: Before I call the next honourable member—
Hon David Cunliffe: Go and fill up!
Mr SPEAKER: I say to the Hon David Cunliffe that the Speaker is not going to go and fill up. What is more, the member will not interject like that when I am on my feet. Interjections give this House some life, and it is important that this place is not boring, but I think the point that Dr Cam Calder has made is a fair one. The level of interjection that the Hon Judith Collins was having to try to speak through was pretty unreasonable. I ask members to be a little more reasonable.
Hon ANNETTE KING (Deputy Leader—Labour): We have just heard from Judith Collins—a Minister who has had a lot from taxpayers. She has had gallons and gallons of free petrol. She is now known as the biggest gas guzzler in the whole Parliament. I have to say that the gloss is going off this superficial Government very fast, indeed. I was very interested to read Colin Espiner’s column yesterday when he said: “In the life cycle of every administration, there’s a stage when it ‘tips’ …” and he asks about that because he thinks that perhaps things are about to change for the worse for this Government. I have to say to Colin, if he is listening, that he is dead right. People in New Zealand and serious commentators are waking up to the fact that they have a Government of spin, spin, spin. They have a Government of bluster and blatherskite. It is a Government of photo opportunities, whether its members are posing with babies or posing in a flak jacket in Bamian. Policies are pulled out of the hat to meet a media and photo opportunity.
Where have the enduring principles of the proud old National Party gone? They have been replaced by opportunism and poll-driven slogans. That is what we get from the Government of today: “ambitious for New Zealand” has become “ambiguous for New Zealand”. We were going to have a step change with a cycleway that has not produced a single job. We were going to catch up with Australia, but Australia’s unemployment is going down and our unemployment going up. And, guess what is happening: the New Zealanders who were all going to come home under John Key’s Government are all heading back across the Tasman. What we get from National members are big bang policy announcements so that they can keep up the old poll ratings, which they take every week. I believe that National members are the original poll-driven fruitcakes. Everything they do is based on a poll. Serious commentators are now asking: what does National stand for; where is the Government’s moral compass; what drives the Prime Minister; what is the plan; what is the step change; and where is the leadership?
Let us take just unemployment as an issue. Unemployment, when people’s jobs are taken from them and they are thrown on the scrap heap, is one of the most pernicious things we can have in society. Any serious Government would see what it could do to help those who are unemployed, particularly young people who are just starting out in life and want a job. All they have from this Government are publicity shots; unemployment has been nothing more than a plaything for this Government. It has not taken unemployment seriously. As Phil Goff said, it held a media-managed Job Summit. Everyone was to come to the summit and have a look at Mr Key as he announced major policies that would bring about a step change for New Zealand and jobs for everybody. I have to admit that it got him on television, but what have we ended up with? We had an unemployment rate that was the lowest in the OECD, below Australia’s, but it is now one of the highest at 7.3 percent—30 percent higher than Australia’s. Australia has created 215,000 jobs in 6 months.
What have we done? Sixty thousand Kiwis have lost their jobs. Of our young people, 72,000 of them are now unemployed. For 6 months Mr Key and his Cabinet did nothing, but on 1 August last year along came the National Party conference. A late Cabinet paper, of 29 July, was rushed through so John Key could make an announcement at the National Party conference. No wonder Treasury said the policy was poorly thought out, it was not going to achieve the goals, and, basically, it was a waste of money. Treasury has been proved correct. I ask National members opposite to have a look at the results of their policies, because they have not produced them for young New Zealanders. It is a crying shame to see what that Government is doing to so many young people in this country.
Hon STEVEN JOYCE (Minister of Transport): The effects of the global economic recession have been felt around the world but not so much in this end of the world. In fact, this end of the world has actually been pretty lucky in the overall context of the world economic recession. It will come as a surprise to the members opposite to know that, in fact, New Zealand grew at a faster rate than Australia in the second half of 2009 on a per capita basis. That will come as a surprise to the Opposition, but it just goes to show that New Zealand is not doing too bad, but there is heaps more to do.
Here is another piece of news for the Opposition: Governments do not hold up the sky on their own; they can do things in the short-term—and this Government is—but, ultimately, it takes businesses in viable industries where New Zealand has a competitive advantage to create ongoing jobs. We do not magic them out of thin air, I say to Mr Cunliffe. That means having a tax system that, firstly, encourages people to work hard and get ahead. Budget 2010 will deliver that tax system for New Zealand.
It also means a regulatory environment that encourages industries to grow and add jobs, and to do that we have to have changes and we have to look at things that we can do to encourage industries. I talk of things like unlocking responsible mining opportunities for jobs, things like unlocking irrigation opportunities for jobs, things like unlocking opportunities for more aquaculture space, and things like allowing more productive heavy vehicles to transport our goods to market; all of which this Government is doing and most of which the Opposition opposes. Labour members say we do not do enough about jobs but they have no solutions, and all the time they hate the things that we are doing. They bleat on and on about job creation and growth but what did the previous Labour Government do to tackle any of these challenging things when it had the chance? It did nothing, and members opposite offer nothing now. They offer nothing to encourage industries to create growth.
In fact, their only solution is to saddle a struggling Crown company with a political decision to try to start a new industry when that company knows that commercially it does not make sense and has no comparative advantage. In fact, members opposite know that as well, because the previous Government had the opportunity to build trains in New Zealand but did not go ahead with it. But that is their only token suggestion.
This Government does assist; it is working hard and helps job creation by investing in infrastructure. We are doing that like nobody else.
Hon David Cunliffe: Where is the broadband?
Hon STEVEN JOYCE: We are making massive investments. For example, we have invested massively in Transpower for electricity transmission, in roading with $11 billion for new State highway infrastructure in the next 10 years, and, yes, I say to Mr Cunliffe, in ultra-fast broadband. If Mr Cunliffe had left the sector in better shape, then we would not have to take the reasonable period of time we are to achieve that. Also we are making massive investment in education and skills. Labour members do not talk about this, but we have the largest number of places ever in New Zealand tertiary institutions this year.
But the biggest impact the Government can have on real growth is to control its own expenditure. Controlling Government expenditure keeps debt down, it keeps interest rates lower than they otherwise would be, and it keeps exchange rates under control. Labour members do not understand that; they actually want something done about exchange rates—they have been talking about it for a year now but they have no ideas.
One of the most important things that a Government can do to influence these things is through its Budgets and showing control of expenditure. That is what Budget 2010 will do. It will control expenditure, and it will give the opportunity for the private sector to grow because it will lower interest rates. The Opposition needs to learn to understand that, because frankly Mr Cunliffe does not. He claims there is no debt problem in New Zealand. He says that somehow we could just magic our way to success by borrowing more money. Well, that is a recipe for disaster, as the Minister of Finance pointed out yesterday. We already have large private sector debt. If we add large public sector debt on top of that, we will create a debt problem for New Zealand. Frankly, the Opposition does not understand that, and until it learns about that then the public of New Zealand will not trust Labour with the Treasury accounts again, because its only solution is to spend more money.
Labour members criticise every expenditure change made by this Government and have said they would keep all the expenditure. They would keep spending away and growing the Government’s side of the economy and shrinking the real side of the economy. We know what the outcome of that is; we know it is low growth rates, and we saw it between 2006 and 2008. Before the economic recession even began in the rest of the world, we saw low per capita growth—in fact, negative per capita growth in this country. So Budget 2010 will create many more jobs in New Zealand by controlling expenditure and investing in infrastructure.
Hon DAVID CUNLIFFE (Labour—New Lynn): We have heard from the “Minister for Faster Cheaper Broadband”, but not one inch has been laid on his watch. What is happening? Ordinary Kiwis are watching “Cruiser Collins” sucking off the teat of the taxpayer—100 bucks a week in petrol—at the same time that she gets a chauffeur-driven limousine. Bill English was double-dipping on the taxpayer, and is still pretending he lives in Dipton while drawing an accommodation supplement in Wellington. John Key stands up a trade mission in the Middle East, whose members paid $20,000 each to go with him, while he does flak-jacket photo opportunities in Afghanistan. Gerry Brownlee is the only one to get a run on the board this week for that Government. He managed to draw the biggest crowd in Auckland history and unite them against the Government. It was the biggest crowd in Auckland history for Gerry Brownlee.
While all of that is happening, what are ordinary Kiwis saying? I will read out a heartfelt plea from an ordinary Kiwi that I saw on a website: “Every time National gets in it costs me directly in the pocket, being an average Kiwi. Last time they were in there were calls ‘We need to tighten our belts’. Then things did get better under Labour, but again National are cutting things and costing me and mine in the pocket, using the same catchcry ‘Tighten the belts for the betterment of the country’. I suppose they mean things will get better for middle and lower Kiwis when Labour are back again.”
Things just go from bad to worse for Bill English. Two weeks out from the Budget, the Government should be rolling in a string of positive press from its own pre-Budget announcements, but instead it is rolling in the muck of its own making. Things go from bad to worse. “Families paying more for their groceries”, “Wages stall”, “A third of young New Zealanders out of work”, and today we hear that the cycleway, which was the No. 1 job scheme, has created not one single job—zero, nada, zip, nothing. There was not one job from the No. 1 initiative of the Job Summit.
Hon Ruth Dyson: That was the big deal.
Hon DAVID CUNLIFFE: That was the big deal.
What about the 9-day fortnight, the great job scheme? It was so bad that only 30 companies used it and the Government cancelled it in the middle of the recession. What about ordinary Kiwis who are worrying about paying the bills? They received about 1 percent in wage growth in the last year—1 percent—and that was before inflation. They are going backwards and they know it. They are worrying about paying the mortgage, worrying about putting food on the table, and worrying about their power prices going up. Meanwhile “Cruiser Collins” is looking for a gas station. It just is not right.
The tipping point has come, because New Zealanders now believe that this Government is more worried about its own popularity than about doing what is right for New Zealand and about having New Zealanders’ interests at heart, putting food on their table, and protecting their jobs. Here is the truth, here is the bottom line: this Government does not have a plan for the job of “Joe Average”.
The Government does not have a plan to grow this economy. It says that four things will do it—the four solutions. More jobs, it says, but that does not work because the gap with Australia is widening and our unemployment is now at a record high for the past 10 years. It would reform the tax system, but that means the “Joe Averages” will pay more for GST on everything they buy and the rich few will get a whopping big tax cut. That does not work.
The Government says there will be better delivery of public services. Well, we have not talked too much about that, so let us just go through a few broken promises. National promised that it would not cut services. What part of that promise has it broken so far? It has taken $49 million from road policing, there has been a 25 percent cut in teachers’ professional development, and it has taken $130 million over 4 years from adult education.
There are 250,000 Kiwis who have lost their night classes to save about $13 million a year, which is about one-third of the extra subsidy that those Tories gave to private schools. Quarter of a million ordinary Kiwis are missing out so that the Government can give a bonus to private schools, and that is wrong. Ordinary Kiwis know it is wrong. They think it stinks, and that is why the tipping point has come. The Government has taken $25 million over 4 years from curriculum development and school programmes in State schools, and $28 million from the training incentive allowance.
PESETA SAM LOTU-IIGA (National—Maungakiekie): The upcoming Budget is what National will put forward for this country. We have a plan, despite what the previous speaker, David Cunliffe, alluded to. The plan will underline this Government’s credentials as a safe economic manager of this country. The plan will look to a tax system that is fairer across all sectors of the economy, and it will also produce a set of accounts that will read much better than those under the last Government, which were bleeding red before the economic recession hit this country. Unlike our counterparts across the Chamber, we will not have a borrowing programme that will lead us to the type of situation occurring in Greece and other countries across the world, which are experiencing severe financial distress.
The legacy the last Labour Government left us was one of stagnant growth, and one of economic growth that, year on year, was approximately 1 percent. One percent growth per year, year on year, during its administration is unacceptable. But growing at a rate of knots under the last Government was core Government bureaucracy. That was the biggest game in town under the last Government, and it is the game that this Government is committed to reining in. The other big legacy the last Labour Government left for us was a tradable sector that had been declining for 5 consecutive years. For 5 consecutive years the New Zealand export sector declined. We will not get out of this economic recession unless we expand the export sector, expand job opportunities within that sector, and expand the economy in terms of our external debt. Things will be grave economically if we are not prudent. Our external net debt is 90 percent of GDP. I repeat that: our external debt is 90 percent of GDP—one of the highest ratios in the Western hemisphere, one of the highest ratios among developed countries—and we have to stop it.
The last speaker asked about creating jobs. I heard from my friend Mr Quinn recently that a job is available: the job of Leader of the Opposition. Apparently a barbecue is going on this Friday night, but we do not know the location. We do not know whether it will be in Wainuiōmata, St Marys Bay, or up in Northland. [Interruption] Well, that riled them. Where is it? I hear it is in St Marys Bay. Members should bring their own lattes—BYO lattes. They do not eat sausages any more; they eat quiche at the barbecues. Labour members eat quiche at their barbecues.
Hon Member: A new leader on Saturday morning.
PESETA SAM LOTU-IIGA: We have heard right here in the Chamber that there will be a new leader on Saturday morning. As much as I admire my friend and colleague Mr Goff, who is MP of a neighbouring electorate and is a good electorate MP, I do not believe that the people of New Zealand look at Mr Goff and see the next leader of this country. Members on that side of the House have to think about where leadership comes from.
Carol Beaumont: Why don’t you talk about jobs for New Zealanders?
PESETA SAM LOTU-IIGA: They want to talk about the economy. It is about productive investment and savings. Only through investment, savings, and changing the structure of our economy will we get out of this recession.
Stuart Nash: Where’s the plan?
PESETA SAM LOTU-IIGA: I say to Mr Nash that the plan is quite clear, as he knows. The plan is quite clear: a fairer tax system, investment in innovation, and investment in jobs that matter to this country. We are also about saving.
Hon DAVID PARKER (Labour): In the next session of this Parliament Mr English will present his second Budget of this term of office—the second of three Budgets, 1 short year away from the likely election. It is time to reflect on whether National is performing and keeping its promises. We have heard today Steven Joyce and, during question time, Bill English ranting unwisely that the prior Labour Government mismanaged the economy. I have The Economist magazine from this week in front of me—the world’s pre-eminent financial magazine. What is the front-page story? “Acropolis now: Europe’s debt crisis spins out of control”. It is not just Greece, not just Portugal, and not just Italy; it is all of those countries plus Great Britain and others, albeit to a lesser extent. All of those countries went and did what National members, when they were Opposition spokespeople, said New Zealand should do. At that time, John Key said that Labour should not be running those Budget surpluses and reducing Government debt; he wanted tax cuts for New Zealanders. After Bill English took over his position, he said exactly the same.
If we had made those decisions it would have left New Zealand in the same position as the countries that are highlighted in this week’s issue of The Economist magazine. New Zealand’s Government debt would be out of control. Instead, the Labour Government, against the strident opposition of the National Party, ran Budget surpluses until we had countercyclical tax cuts as we left office. Those Budget surpluses meant that we left Government debt low: gross Government debt at 17 percent of GDP, and net Government debt at close to 0 percent of GDP.
Instead, if we look at Italy, we see that Government debt is 116 percent of GDP—these are last year’s figures—and if we look at Great Britain, we see it is 68 percent of GDP but heading very fast towards 100 percent of GDP. We in this country experienced the mismanagement of the economy under the Rt Hon Sir Robert Muldoon, who left New Zealand’s debt at about 80 percent of GDP, so we know that it takes a whole generation to get it back under control. I am sick to death of National members crowing about economic mismanagement by the Labour Party when they know we did it right, and as a consequence we are not one of the countries that The Economist is listing under the headline “Acropolis now: Europe’s debt crisis spins out of control”. We left the books in good order.
I turn to the comparison with Australia. The National Government was elected on the promise that it was going to lift New Zealand’s fortunes and get back to the position of Australia. What is happening? The opposite: we are getting further apart. Unemployment is getting worse. You know, people always ask what the big difference is between New Zealand and Australia, and those members say it is mining. At one stage they were going to open up 467,000 hectares of national parks, which was going to get us to close to Australia. Well, they have whipped that plan back to 7,000 hectares, which is obviously not going to get us to catch up with Australia, and where is their plan?
National’s Minister for Economic Development, Gerry Brownlee, has no other plan. The big difference between New Zealand and Australia is Australia’s savings record, its access to capital, which gives it the money to invest in productive enterprise, to pay higher wages, to sell smarter products, and to have more manufacturing in its home country. But what does the National Government do? Well, it does what National Governments have always done. In 1975 a National Government cut the savings scheme that would have had New Zealand in the same position as that of Australia. That was a Labour Government scheme, designed by Roger Douglas and implemented by Norman Kirk. Since then, this National Government has done the same thing again with KiwiSaver. The difference is savings; National does not have a plan. The gaps between us and Australia are growing ever larger.
CHRIS AUCHINVOLE (National—West Coast - Tasman): As a well-known political catchphrase goes, “It’s the economy, stupid.”, and I say that it is. Indeed, no amount of emotion, such as we have just heard expressed on the other side of the House, will make a difference to the hard facts. I am delighted to speak in today’s general debate, on the economy. The economy is the most fundamental part of Government, and the economy influences the standard of living of our population. The economy determines what we can afford to spend in the crucial areas of health, welfare, and education, and the economy is crucial for creating jobs and realising higher incomes.
Let us reflect for a moment and go back over some of our economic history, through the Holyoake years, the Kirk years, the Rowling years, the Muldoon years, the Lange, Palmer, and Moore years, the Bolger years, the Clark years, and now, at a time of economic renaissance, the Key years. I know, from my own experience in business and from listening to others, which of those periods was best for hard-working New Zealanders and their families, and it was not, is not, and never will be, the years during Labour’s tenure; Labour likes a welfare-dependent constituency.
Today I will talk about the progress we have made in resurrecting the economy after 9 years—9 long years—of economic mismanagement. I will talk about the steps we have undertaken to ensure that the edge has been taken off the recession—because it has been. I will talk about the policy direction in which we are moving forward in order to maximise our economic growth and productivity. We in National look to reward resourcefulness, to encourage enterprise, and to salute and celebrate success, and that is reflected in the economic decision-making of our team. First of all, I ask what kind of economy we inherited from the previous Labour Government. When we, the National-led Government came into office, New Zealand had already been in recession for most of the year. By the December 2008 fiscal update, net debt was soaring to be about 50 percent of GDP by 2023, and there were permanent deficits. It was obvious that this country needed some serious economic salvaging from the mess that Labour policies were largely responsible for.
We have acted quickly to cap the numbers in our core bureaucracy, with $2 billion being moved to front-line services. Another $1.8 billion will be redirected to Budget 2010. We have invested billions of dollars in critical infrastructure such as high-speed broadband, and we have implemented a $500 million relief package to make life simpler for small businesses. We have also simplified and streamlined the Resource Management Act.
Hon Trevor Mallard: Who wrote this rubbish?
CHRIS AUCHINVOLE: That Act is perhaps the most important legislation to date—and Mr Mallard knows that. The Local Government and Environment Committee, of which I am the chair, worked diligently and hard to ensure that the amendments would achieve the intentions of making it easier for businesses to grow, and of investing in and creating jobs, while protecting our environment. This, and the other changes we are embarking on, will be a great boon for our economy.
Let us think for a moment of the rural areas that we so much depend on for the revenue-earning capacity of our country. Let us look at West Coast-Tasman, an electorate of resilient, resourceful, and hard-working people, and an electorate that I am very, very proud to represent. The recession has been cushioned by the increase of jobs in mining, the very industry that Labour—mining is its own origins—now wishes to dismantle and to suffocate. The tourism industry, under the guidance of the Minister of Tourism, Prime Minister John Key, in the West Coast has actually increased during the recession, and it has increased substantially.
We have seen a stabilisation of agriculture and horticulture within the electorate. We are starting to see interesting changes. For example, I was doing a shop-by-shop visit the other day in Motueka, where the majority of retail businesses are doing very nicely, and where they are reporting that people are now coming over from Nelson to Motueka to shop for a greater range of goods and for price competitiveness.
HONE HARAWIRA (Māori Party—Te Tai Tokerau): Kia ora, Mr Speaker. Kia ora tātou katoa. On Saturday a friend of mine turned 50; Tau Henare wanted to say “Skunk, Happy Birthday!”. I thought I would dedicate this slot to recognising a son of Ngāti Āmaru, a committed supporter of the Kīngitanga, and a longstanding member of Black Power.
Martin Cooper was just a kid when Black Power was born here in Aotearoa. It was the voice of alienated and freshly urbanised Māori youth revelling in being outsiders and rejecting a mainstream society that was determined to crush the hopes of marginalised Māori youth. Like many other young Māori coping with adolescence, he was a handful. He was whāngaied out when he was young, eventually finding unconditional acceptance only with the Black Power whānau, during tough and dangerous times when he often ran foul of the law.
As he matured, his leadership qualities became increasingly apparent, and he soon began to respond to the inner voice that told him that he was Māori, and that the Black Power in Aotearoa was something that had to draw its values and beliefs from the teachings of his ancestors. Influenced by leaders like him, the often aimless and destructive gang runs were replaced by marae-based alcohol-free and drug-free wānanga, which led to Black Power taking a firm line against the then all-too-common practice of gang rape. That took courageous leadership from people like Martin. He has also been a driving force in the movement to stop the manufacture, distribution, and use of methamphetamine, which was the fulfilment of a promise made at the graveside of a much loved lost brother Hone Day.
His growth saw him move to Hamilton in pursuit of his reo, and he talks fondly of the whānau that took him in to teach him his mother tongue under the kaupapa of Te Ataarangi. The commitment and the dedication that had marked his time with the brotherhood showed results as he grew into his role as the speaker for his whānau. Martin’s involvement with waka huia is also one of long standing, enabling him to bring the discipline and power of kapahaka to the Black Power brotherhood. Again, he worked at it with the dedication and the passion that he gave to everything he did, promoting wānanga all around the motu, and dedicating his efforts to Ngāpō and Pīmia Wehi, whom today he proudly calls his mentors.
He has worked hard, demonstrating the value of hard slog and of earning a legitimate income, eventually taking up a job with the Group Employment Liaison Scheme and the Community Employment Group scheme, where he mentored me into my one and only Government job, and where he gave his all because the kaupapa of his work was giving back to the communities from which he came. This employment within the belly of the beast raised his consciousness about where the real decisions were being made, and about how, if he really wanted to influence the health and wealth of his people, he needed to be a policy maker and not just a policy statistic. That knowledge led to his undertaking, and being successful at, tertiary study, which reminds us all that the pursuit of knowledge is a lifelong obligation, and puts out the challenge again to the brotherhood that to learn is to grow.
In recent years Martin’s new-found knowledge, his growth, and his commitment to Māori development led to his getting involved with the Māori Party, where he quickly became a critical leader of Pita Sharples’ A-team, helping Pete to win in 2005, and taking up a formal role after the 2005 election—a position he still holds today. Again, he has demonstrated another route for young Māori warriors and another set of possibilities, created by his work ethic and his commitment to a kaupapa. His loyalty to his Kīngitanga is something he carries without much fuss. It is a role he accepts as part of his leadership within his whānau and his hapū, a commitment that is lifelong, and a belief that he carries in his heart wherever he goes. A proud son of Tainui, Martin is a fine ambassador for his people.
Today I acknowledge a brother of the Māori nation who has shown by his efforts that commitment, dedication, loyalty, and passion are talents that can take anyone to where they want to be. Martin Cooper is a leader in all that he has done and a role model for others to follow. Kia ora tātou katoa.
Dr PAUL HUTCHISON (National—Hunua): It is highly relevant that the Leader of the Opposition and the deputy leader of the Labour Party have presided over two of New Zealand’s worst economic disasters. Those leaders have been around for many decades. I can think of the years between 1984 and 1989 when their Government left New Zealand technically bankrupt. But the other highly relevant point is that when Labour’s new blood, its new finance spokesperson, the Hon David Cunliffe—man of the people; member for New Lynn but resident of St Marys Bay—went on study leave in Tokyo the other day, Labour’s polling suddenly went up. When he came back, 2 to 3 weeks later, Labour’s polling went down again, and did so from a very low base, I must say. This just absolutely points out what a bad situation Labour is in—what a shocking situation it is in. First, Labour has a leader and deputy leader who have presided over New Zealand’s worst economic disasters. Secondly, when the brand new blood went out of the country, Labour made a bit of a recovery in the polls. But that has not lasted. No, Labour has gone straight back down, into the depths of despair, which is its true place.
However, it is important to remember back to those absolutely disastrous years of 1984 to 1989, when Phil Goff and the Hon Annette King were there. New Zealand was technically bankrupt at the end of that time. Interest rates were up to a massive, whopping 22 percent. Farmers had to leave their farms, at the end of Labour’s legacy. Inflation was up to 6 or 7 percent, and unemployment was generally at 11 percent, but for Māori it was 22 percent and for Pacific Islanders it was 33 percent.
Stuart Nash: You’ve got it wrong.
Dr PAUL HUTCHISON: I can hear Mr Nash saying that that is wrong. He has forgotten just how bad Labour’s legacy was back then, in the 1980s.
But let us have a look at what happened between 2008 and 2009, because in many respects that time was just about as bad. That was a possible golden era for New Zealand, but the Labour Government blew it—it absolutely blew it. In fact, Labour had the gall, in its very last Budget, to spend up $10 billion in the hope that it could win back a few votes. Labour left the cupboard bare. Labour had the gall, in the knowledge that an economic recession was on its way, to leave New Zealand’s cupboard absolutely bare.
Let us have a look at some of the figures. There was falling economic growth: minus 0.2 percent annual GDP growth in the December quarter of 2008-09, down from 3.2 percent. But it is worse than that. When Labour came into power in 1999, economic growth in the last quarter of the National Government was 4.6 percent. But growth rocketed the wrong way, down to minus 2 percent, at the end of 9 long years of Labour. There was rising unemployment, at 4.6 percent in the December quarter of 2008-09, which was up from 3.4 percent in 2007-08. It was reminiscent of that decade before, when Labour let New Zealand down so badly. There was high inflation, 3.4 percent annual CPI growth, a $16.1 billion current account deficit, and annual productivity growth that was only 1.1 percent, between 2000 and 2008.
I can think of just how bad it was in the health field. A Treasury report pointed out that there was no productivity growth in the health sector over those years when Labour invested or spent—misspent—an extra $6 billion a year. Labour invested $6 billion a year, but for no extra elective surgery. Yet in the last year National has been proud to announce that 11,800 new elective procedures are being done per year. It has been a magnificent time for this National Government.
STUART NASH (Labour): What a rewrite of history that was. I think the previous speaker, Paul Hutchison, is mixed up with Muldoon. At the end of the Muldoon era we were in such trouble that public servants had to go out and put stuff on their credit cards, we were so hard up. As for Ruth Richardson—goodness me! It took until New Zealand had a Labour Government to get unemployment down to the level it was at previously. What a rewrite of history.
I would like to start with a very short quiz. Who said: “National is not going to raise GST.”?
Hon Trevor Mallard: John Key.
STUART NASH: Right; it was John Key. The people of New Zealand voted for no increase in GST, because this is what John Key explicitly told them: “National is not going to raise GST.” Mr Key and Mr English are National members, and they are going to raise GST. It annoys the hell out of New Zealanders that these senior politicians could be so disingenuous as to promise one thing and deliver another. The Prime Minister promised no GST increases, yet New Zealanders will get them. That is simply not fair. That is called a broken promise. My question is: why would we raise GST? That is a rhetorical question, because there is no right answer.
Let me give members the facts. Mr Key and Mr English have said that New Zealand taxes consumption at a relatively low rate. The coverage of our GST system is comprehensive, from avocados to zinc and everything in between. As a result, New Zealand has the sixth-highest level of general consumption taxation as a proportion of GST out of the 30 OECD countries. The OECD stated in its 2000 edition of revenue statistics: “There has not been any general trend in OECD countries from direct to indirect taxation. Over the past forty years, the general trend away from indirect taxes has been so strong that only six countries—Luxembourg, Mexico, the Netherlands, New Zealand, Poland and the Slovak Republic—escaped it.” In fact, only Iceland, Ireland, Portugal, and the Slovak Republic had a higher percentage of the total tax take from consumption taxes. We have a comprehensive GST system. I ask the Māori Party members whether they will support a Budget and a Government that increases the rate of GST, when they have a member’s bill proposing to cut GST on food. Where does the Māori Party stand on the issue of a general increase in GST? I say to Rahui Katene to stand by her principles and to not support this Budget of broken promises.
I would like to ask Mr Key and Mr English whether they have read the research from a conservative UK thinktank that found that increases in consumption tax, like GST, would be more damaging to economic growth than increases in base income tax. I would also like to ask the Minister of Finance what he will say to the 19 percent of small to medium sized enterprises surveyed by the New Zealand Herald who believe that any increase in GST will seriously reduce sales, while another 41 percent think it will have a minor impact; that is, 60 percent of businesses polled by the New Zealand Herald believe that an increase in GST will hurt their business. Of those companies, just over 56 percent of them were opposed to any increase in GST, and, of those, 32 percent were strongly opposed to an increase in GST. Not only are the people of this country opposed to an increase in GST but also over half the businesses are, too.
In another scary piece of information for Kiwis, the polling went on to state: “While all firms plan to review their prices, 34.9 per cent envisage an increase of more than the GST increase of 2.5 per cent and 10.8 percent plan an increase of more than 5 per cent.” Mark my words: if the Government thought that this would be a nice and simple transition, it is being naive. What will the Government do to ensure New Zealanders are not ripped off? I will tell members what—nothing. Do members know why? It is because unless someone earns above the top marginal tax rate, the Government does not care. We have seen that proven in the House today when the Government said that it would not back Darien Fenton’s redundancy bill. That is the law in Australia. We keep comparing ourselves with Australia. Well, if we want to compare ourselves with Australia, then the Government should back Ms Fenton’s bill.
HEKIA PARATA (National): Tēnā koe, Mr Assistant Speaker. I will start my contribution this afternoon by inviting the Opposition members to join us on this planet. So far this afternoon we have heard a reinvention of the his-and-her-story of the time when members on that side of the House were in Government. The previous Labour Government left a legacy of red ink to us—red ink. We had falling economic growth, with a 0.2 percent increase in annual GDP in the 2008-09 December year, which was down from 3.2 percent. We found that members opposite specialised in plummeting figures rather than in rising ones. The exception to that was the unemployment rate, which was 4.6 percent in the 2008-09 December quarter. It had gone up from 3.4 percent. Under Labour we had high inflation, a 3.4 percent annual consumer price index—
Hon Darren Hughes: What is it now?
HEKIA PARATA: I will get to that. If that member would just still his impatient heart, I will get to where we are on that. We had a rising current account deficit under Labour. It was around 9 percent of GDP or $16.1 billion for the year ended December 2008, having gone up from $14.4 billion. Annual productivity growth was only 1.1 percent. What a significant achievement that was by the previous Labour Government between 2000 and 2008!
But members can rest assured that this Government has a plan. The National members have a plan. This plan brought us into Government in 2008 and saw us delivering a Budget in 2009 that redirected $2 billion worth of low-value expenditure, all of which had been brought in by Labour. Now we have a plan for 2010. New Zealanders are asking whether they should have Labour, which is a spend, spend, spend type of administration—
Peseta Sam Lotu-Iiga: Borrow, borrow.
HEKIA PARATA: —I have not even got to the borrowing and taxing side of it yet—or whether they should have the preparation for future growth that this Government is interested in, where numbers in the core bureaucracy are capped, $2 billion is to be moved to front-line public services over the next 4 years, and another $1.8 billion will be found in Budget 2010.
New Zealanders can ask whether they should have the Labour approach to life, which is to borrow, borrow, borrow, when on the other hand they could have the National approach to life, where billions of extra dollars are invested in critical infrastructure—
Hon Trevor Mallard: This is a disgrace. This member shouldn’t talk on that topic.
HEKIA PARATA: —that member might care to listen, instead of shouting his frenetic statements, which nobody is interested in—including the national grid and broadband. That infrastructure investment directly supports thousands of jobs in our communities and contributes to a stronger economy. They might ask whether they want the Labour approach, which is to tax, tax, tax, or on the other hand whether they prefer the National approach, which is to invest in a $500 million relief package to help simplify things for small businesses, which members on this side of the House understand are what will help to grow the economy in order for us to have a sustainable tax base.
Do we want the Labour approach to life, which is to spend, borrow, spend, tax, spend, and borrow—and so the refrain goes on—or do we want an approach that sees the Resource Management Act simplified so that more people can get into business, more development can occur, and more jobs can be made available? Do we want an approach where we undertake major reviews and action follows them, unlike the approach of the Labour members, which was to have reviews and consult people to death when they were in Government, so that people suffered from consultation fatigue? That is the opposite of what members of the National Government do, because we take action on the things that we undertake to do. That is the kind of plan that members on this side of the House have.
Budget 2010 will see us lift New Zealand’s long-term economic performance, because we are interested not in the short-term frippery that characterised members opposite when they were previously in Government, but in long-term, sustainable economic performance. Budget 2010 will outline broad-based reform of the taxation system, so that it becomes fairer, leaves the vast majority of households better off, and supports faster growth. Budget 2010 will move taxpayers’ money to high-priority public services, spending significantly more on health and education. As we speak, the Minister of Health has just announced a new bowel cancer-screening test. That is yet another contribution to sustainable, long-term health in our community.
We have a plan. We have a Budget that is good for the economy and for New Zealand families. We invite members on that side of the House to join us on this planet, where we are ambitious for New Zealand and have a plan to support those ambitions. Kia ora.
The debate having concluded, the motion lapsed.
Bills
Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill
First Reading
DARIEN FENTON (Labour): Kia ora, Mr Assistant Speaker. Kia ora e te whānau o ngā ringa tōtā. I move, That the Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill be now read a first time. It is a privilege to introduce the first reading of this bill, and at the appropriate time I intend to move that the bill be considered by the Transport and Industrial Relations Committee.
In the last year 60,000 workers have lost their jobs. For each of those workers, that is a personal tragedy. Every one of them has faced the awful impact and humiliation that redundancy has had on them and their families. How they have coped will have differed. Those who are union members, by and large, will be better off, because most of them are likely to have had some kind of redundancy protection in their agreements. But thousands of others—like the warehouse supervisor Rob Highsted, who had worked for his company for 20 years until he was made redundant this week—will have gone out of their jobs with absolutely nothing.
An estimated 80 percent of working New Zealanders have no redundancy protections written into their employment agreements. For these New Zealanders, losing their jobs can mean that they have no way to pay their mortgages, or support themselves and their families, while they search for other jobs. That is because there are no requirements in New Zealand law for minimum redundancy notice and compensation. The need for a fair system for redundancy protection has become more urgent over the past 18 months, as more people have lost their jobs and replacement jobs have been harder to find. I have been hearing from laid-off workers who have had no redundancy notice and pay. That has left them struggling to pay their mortgages and support their families. I have no doubt that other members in this House have heard the same stories.
This bill would provide all working New Zealanders with basic redundancy protection to help tide them over between jobs. It is based on recommendations from the 2008 report of the Public Advisory Group to the Minister of Labour on Restructuring and Redundancy, which advised the then Government to consider introducing minimum redundancy protections for all workers. That group was established by Labour in 2007 to examine the adequacy of redundancy laws and provisions in New Zealand workplaces. The group was an independent body established to provide advice to the Government, and it included representatives from the New Zealand Council of Trade Unions and Business New Zealand.
The advisory group recommended options for addressing the gaps in, and issues with, the existing law and policy provisions. The first recommendation of the advisory group was that the Government should consider the introduction of a statutory requirement for redundancy compensation, and other entitlements that incorporated the following features: notice of redundancy termination for the affected worker, compensation based on length of service, a maximum level of statutory compensation and provision of redundancy support, and active labour market mechanisms for affected workers and organisations. Unfortunately, the National Government’s Minister of Labour allowed this very extensive and well-researched report to languish on her desk for 12 months, and then she threw it in the rubbish bin.
This bill amends the Employment Relations Act by inserting a new Part 6E, “Statutory minimum redundancy entitlements”, under clause 4. The minimum entitlements for employees in this new part would apply to an employee who had been in a continuous employment relationship with an employer for more than one calendar year. Within 12 months, the Minister of Labour would be required to conduct a public education campaign to inform employers and employees of the minimum entitlements conferred by this legislation, and to report to the House of Representatives within 6 months of the conclusion of the campaign as to its details, including an independent evaluation of its effectiveness. The minimum entitlements under the bill that employers would receive as a result of new section 69ZL(1), inserted under clause 4, would be: “(a) notice of dismissal”—due to redundancy—“of no less than 4 weeks; and (b) compensation for redundancy … of 4 weeks’ remuneration for the first full year of the employee’s continuous employment with the employer; and (c) further compensation for redundancy in the amount of 2 weeks’ remuneration for each subsequent full or partial year of the employee’s continuous employment with the employer, up to a maximum entitlement of 26 weeks’ remuneration.”
New Zealand workers are among the cheapest and easiest in the world to sack. We are nearly alone in the developed world—apart from the USA—in having no redundancy notice in compensation. Last year, the Australian Federal Government introduced generous redundancy entitlements, because it is serious about protecting working families through the recession. We keep talking about wanting to catch up with Australia, but the Government seems unwilling to take notice of any of its good ideas—and have we not heard some of them today! We can take the example of the hundreds of skilled New Zealand engineers who were dumped from their jobs with Australasian company Transfield Services, with no redundancy pay. Transfield said that it did not have to give them any redundancy pay, because there was nothing in law and nothing in the agreement for it to do so. Funnily enough, if those workers had been in Australia, Transfield would have been required by law to pay at least the compensation proposed in my bill. It just does not make sense to me that a company can treat its workers one way in its home country and differently in another country. But, unfortunately, they do.
Hon Lianne Dalziel: Because they can.
DARIEN FENTON: That is right. This issue is not just some abstract notion that I have dreamt up. I know that you yourself, Mr Assistant Speaker, have been involved in this issue in the past, as a member of Parliament. I have advocated for workers who have had redundancy compensation, and for those who have not had it. I have seen first-hand how devastating redundancy is, and how devastating it can be, for those workers who get laid off with nothing. I have been made redundant. My husband has been made redundant twice. I also had to make some of my own staff redundant when I was an employer, so I have a good idea about what it feels like from all sides. Redundancy pay does not make up for the loss of a job, but the important thing is not just the process but being left with a feeling of dignity and respect. That is very, very important. Being laid off without notice and redundancy compensation is shocking. Not only does an employee’s job disappear, leaving him or her without any feelings of self-worth, but there are still bills to pay, kids to feed, and the huge uncertainty of whether that employee can find another job, particularly in the current market. This bill is about giving families some breathing space, some time to pay the bills while they have that breathing space, and some time to find other work.
Redundancy can happen to anyone. It is not an issue for low-paid workers or higher-paid workers; it can happen across the board. We are talking about workers in all categories of occupations, from the low-paid and vulnerable, as I said, to the highly skilled. Just this week, I had an email from a worker who said to me: “I work in IT, and I was made redundant due to the economic downturn. The employment contract I had did not have any redundancy clause in it. I was told this news 2 weeks before the Christmas break. Looking for work over that time was next to impossible.” Now, after 4 months that worker does have a new job, but she is earning less than one-third of what she used to earn; she has lost her house and all her savings. We know that lay-offs happen to well-paid workers, too, but normally they get suitcases of money—we can just look at former Telecom chief executive, Theresa Gattung. She got $1.8 million in a golden handshake. When Evan Davies left Skycity, he got $1.77 million. David Holdsworth from Hellaby Holdings got half a million dollars. Craig Norgate left Fonterra with about $1.5 million. So if it is good enough for them, I do not think that the very modest provisions in this bill are too much to ask for other workers, after years of service.
Hon Lianne Dalziel: What do MPs get?
DARIEN FENTON: Well, that is right. MPs, of course, get 3 months’ salary, and other things.
This bill should go to the select committee for a proper discussion and consideration. We need to front up to the question of whether it is fair that Kiwi workers are being laid off through no fault of their own, and with no basic financial protection to tide them over in the hard times between jobs. This afternoon the Minister of Labour, the Hon Kate Wilkinson, shed crocodile tears when I asked her some questions and gave her some examples of the terrible circumstances of real New Zealand workers. She said that redundancy is never easy. That is true, but so far she and her Government have done nothing about it. Well, today they have a chance to ensure that there is a fair deal in hard times for Kiwi workers. I urge the Government to do the right thing today for Kiwi workers by supporting my bill to go to the select committee.
Waiata
DAVID BENNETT (National—Hamilton East): The Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill goes to the heart of what Labour stands for and what it tries to do to New Zealanders when it has any ability to set direction over somebody’s life, or even a country, and the way it dictates employment relations. In the previous speech made by Darien Fenton, we heard the classic Labour mentality: the fear tactics, the inability of workers to determine their own future, and how workers need Labour to give them direction. That is the Labour mentality. Labour does not trust its own people. It cannot bet on people making their own decisions and setting their own directions in life. That is the heart of Labour. It wants to keep everybody down. It wants to be in control and keep the same rules so it can dictate what those people can achieve and their direction.
I think it is sad that Labour still does that in this House to New Zealanders. Labour does it to the people from whom it has tried to get support in past years. Labour uses the jealousy technique when talking about Telecom chief executive officers. It uses the fear tactics on ordinary Kiwis out there who want to get jobs and want to work hard. It is about time that Labour woke up and backed New Zealanders. The heart of that mentality was mentioned by the previous speaker, because she wants to make everybody a union member. That is Labour’s purpose for this bill. Labour says that people in a union will get a redundancy payment. This is the heart of what Labour is doing in this legislation. It is not about workers’ rights, it is not about helping workers, and it is not about providing for them in their time of need; it is about providing more union members. This is what it is about: Labour wants to make everybody a union member. Labour needs to look at its heart and soul and at the reality of what it is saying, instead of the rhetoric it brings to the House.
I would like to see Labour stand up and deliver. It had 9 years in Government, but did it bring this legislation forward? No. Where was it? I ask where it came from, because Labour did not bring this legislation forward when it had the chance. Now that Labour is in Opposition, it says this bill is the best thing since sliced bread. Why is that? Labour knows the reality of this legislation. It is not good for New Zealanders and it is not good for Kiwis. That is why Labour did not bring this legislation to the House when it had the chance. Now Labour puts the blame on us. That is Labour’s fear tactics. It says that National is the big, bad wolf that will not pass this bill. Labour had the chance, but it never passed the bill and it will never get that chance again because the public does not trust it. Labour—
Hon Trevor Mallard: Sorry, I thought you’d finished.
DAVID BENNETT: The only person finished is Trevor Mallard.
The Labour Party does not want to give people choice. At the moment we can give workers choice, and we do that because it is to the benefit of workers. If we look at this bill, we see that it sets minimum requirements. If there are minimum requirements, employers will stick to them. They will not give people more than the minimum, and this will hurt some employees who could have negotiated for more than that but who will be held to minimum requirements. Some of Labour’s own people whom it believes it represents will be hurt by this legislation. They will be held to the minimum requirements, when they could have negotiated for something better. What is the matter with negotiating for something better? What is Labour’s problem with that?
This will have a huge cost on businesses. This will hurt workers because businesses will be reluctant to take people on, reluctant to promote people, and reluctant to give them any opportunity because employers fear the cost that this legislation would impose on them. This legislation will hurt the workers. Why would we want to pass a bill in the House that hurts workers in a time of a recession? Why would we want to do that when we have unemployment rates at the current rate? Why would we want to make it harder for people to get a job? There is no commercial reality in what the Labour Party is looking at here. If anything, it is taking a total disregard to the practicalities of the economic environment we are in. The Labour Party is ignoring how hard it is to get a job. It wants to make it harder for New Zealanders to get a job. Labour wants to make it harder for Kiwis to stay in work and to get promotions. That does not make any sense. It is not in the best interests of the people of our country or the future economic growth of this country.
When we look at redundancy provisions, we see that they are already in place. There are personal grievance provisions under the Employment Relations Act. There are plenty of opportunities for people who feel they have difficulty in taking advantage of those kinds of legislative regimes. The Labour Party passed the Employment Relations Act when it was in Government, and said that it was a universal panacea for deciding employment relations. It is available now and it deals with those issues when required.
Let us look at the Public Advisory Group to the Minister of Labour on Restructuring and Redundancy, which the Labour Party said was the great source of directive for this bill. There are some downsides that the public advisory group noted, and I will read these out for members so that they are aware of them. The public advisory group felt that there would be disincentives to hire more staff, there would be reduced wages, there would be more temporary and contract workers, and there would be additional stress on businesses that are already struggling, which would result in further job losses. It felt that the bill would put business viability at risk and would reduce international competitiveness. Not one of those things, whether one is in National or Labour, would anyone want to see happen at the moment. Who wants to have disincentives to hiring more staff? Who wants reduced wages? Who wants more temporary workers? Who wants additional stress on businesses? Nobody does, but the Labour Party is willing to put legislation before the House that would achieve those things. That is not in the interest of New Zealanders or of our working people.
I think it is sad that the Labour Party has to put this legislation up, come to this House, and take the emotions of New Zealanders and portray them as defenceless and unable to negotiate for themselves, so that the big red bus can come along and deliver to those people the safety and direction that they want. It is really sad. It demeans New Zealanders who are working hard and negotiating their future. It shows the mentality of the Labour Party. It does not trust our people, it does not trust individuals to negotiate, and it does not trust the unions because now it wants mandatory requirements. That is very sad in this time and this day. Labour does not take into account the economic reality that we now face.
The Transport and Industrial Relations Committee would hear this legislation if it passed its first reading, but I doubt it will. I am sure that most parties in this House will be of the opinion that this legislation is not in the best interests of workers or our country. It will go down in the history of a Labour Party that tried to control and hijack personal ambition, and that tried to direct people because it thought it knew best at a time when people needed to be given the strength and ability to take advantage of their opportunities. That is the difference between National and Labour. We bet on our people and we want them to succeed. We will not tell them how to live their lives through an institution that sets mandatory rules. We will provide the instruments for people to achieve their full purpose. With that, National will not support this bill. Thank you.
Hon TREVOR MALLARD (Labour—Hutt South): If the speech from the member who has just resumed his seat, David Bennett, were made outside the House, I think it could be described fairly as hypocritical. I know we cannot say that in here, but if it were, it would be. That member, after being here for 18 months, has an entitlement to a redundancy worth over $32,000. That member, after a very short period of time in this House, has a personal entitlement to well over $32,000 worth of redundancy, whether or not he runs at the next election. He could even retire at the next election, which would be a logical thing to do, and he would still get his redundancy money. He said that the most vulnerable people in New Zealand should not be allowed a pittance.
I think, frankly, if there can be criticism of Darien Fenton’s Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill, it is that it does not go far enough. The Public Advisory Group to the Minister of Labour on Restructuring and Redundancy came out with a unanimous recommendation supported by Business New Zealand. Business New Zealand consulted widely with its members and decided that the Government should consider the introduction of a statutory requirement for redundancy compensation and other entitlements incorporating the following features.
Those features are notice, compensation based on length of service, and a maximum level of statutory compensation—this is what this does. It is doing what the employers asked for 2 years ago. Why did they ask for it? They know that having stability and loyalty from their workers is an important part of the employment arrangement. They know that having some stickiness in the labour market, having people wanting to stay with an employer, and having some sort of security if they stay there, with the likelihood of a job going forward and being less likely to be fired if there is a redundancy arrangement, are things that are good. It means that the incentives are on the employers to train people properly, to provide them with decent equipment, and to make them productive, rather than making them redundant as is far too often the case.
Hon Tau Henare: Now who’s the hypocrite?
Hon TREVOR MALLARD: We will not talk to Mr Henare about how he left the trade union movement. That was a bit of a bottler on that occasion, a bit of a bottler, I say to Mr Henare. I do not know whether he got redundancy when he got the sack. [Interruption] Well, when he left Parliament he got $30,000 redundancy money and he came back. Did he pay it back? No, he did not. The Prime Minister said he would take the rough edges off the recession. He has; he has for his mates. He gave Bill English a free house when he was not entitled to one. He let Phil Heatley off when he cooked the books. But does he say to individual workers who are made redundant that they can have a minor redundancy payment? He says no. I think it is an outrage that this Government hates low-income workers.
Michael Woodhouse: I raise a point of order, Mr Speaker. The member made reference to a member “cooking the books”. I think that that is well out of order. I ask that he withdraw it.
Hon TREVOR MALLARD: The member who cooked the books is in the House. He did not take offence. He is the one who pleaded guilty to putting in false claims.
Michael Woodhouse: I am not asking for a withdrawal because I am offended, I am asking for a withdrawal because it was way out of line with Standing Order 116.
The ASSISTANT SPEAKER (Hon Rick Barker): There are two points. Firstly, a point of order has to be taken at the time that the offence was given. The comments were made quite some time back. It was not immediate. That is the first point that I make to you. I accept that the member was looking for the Standing Order, but the point of order should taken at the time. It is very hard to rewind the tape and remember the exact words that were said. That is why the Standing Orders say to do it immediately so that people can have very fresh in the mind the exact words that were said. The second point is that it is against the Standing Orders to accuse someone of breaking the law. But cooking the books is a step short of that—it is. A lot of other words we come to are offensive, but others are not. This is a House of robust debate.
Hon TREVOR MALLARD: Working families are facing hard times. This Government has a choice now to send a bill to a select committee to hear what people think. It does not have to guarantee now that it will support the bill at its later stages. All we want to know is that the Government is prepared to listen to a wide view from people. That is not a big thing. We are not asking for a definite support for the later stages. But we are asking for a relatively lazy Government to sit in a select committee and to listen—to sit in a select committee and to listen to the cases, to listen the way that the employers did at the public advisory committee.
Dr JACKIE BLUE (National): I am very pleased to speak to the Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill. I will make some initial comments about the Government’s priorities for creating jobs. Creating jobs is a top priority for this Government. We are committed to a sustainable economic recovery and to creating more jobs for New Zealanders. The Government’s economic policy during the global recession has been focused on this commitment.
The Government has taken steps to keep people in employment and to assist them when they lose their jobs. We have put in place policies that encourage economic growth, and those policies are built on exports and investment rather than on Government spending or consumer spending. Last year the Government’s small-business relief package was designed to help lighten the load of small and medium sized business, which employ many New Zealanders. That plan was about improving the environment for business, and, therefore, jobs and growth.
A number of members’ bills on employment law have been brought to the House. Some have passed into law, others have not. Suffice it to say that National believes employment law must expand job opportunities and treat all parties fairly, protecting both employees and employers. The purpose of this bill is to insert a new part into the Employment Relations Act, providing for minimum statutory redundancy entitlements.
Currently, if an employee is made redundant, the employee’s entitlements are governed by his or her employment agreement. If there is nothing about redundancy in a person’s employment agreement, the default position is that there is no requirement to pay redundancy compensation. Employers and employees are free to agree to redundancy provisions in their employment agreements. As well, the law also provides that redundancy occurs only when a position has become genuinely redundant. Employers are not able to make a worker redundant on a whim.
Specifically, this bill outlines that all employees who have worked for more than 12 months are entitled to redundancy compensation, and the bill outlines some requirements around that particular point. National will be opposing this bill. We are concerned that statutory redundancy provisions act as a barrier to employers taking on new staff. That would work against the Government’s commitment to creating jobs and fostering economic growth.
The Government acknowledges that during the recession, redundancies have been of real concern. In late 2008 the Government launched its ReStart package, which provided for workers made redundant, helping them back into work. This was set up quickly to help provide breathing space for those hardest hit by redundancy.
The issue of statutory redundancy was assessed in the last term of Parliament, in great detail, in the report of the Public Advisory Group to the Minister of Labour on Restructuring and Redundancy. Interestingly, 14 of the 22 submitters supported the status quo. There are negatives, which were noted by the report, and they are concerning and numerous. Members of the group were concerned that there would be disincentives to hire more staff and that wages could be reduced. They envisaged that there would be more temporary and contract workers. Importantly, they were concerned that by putting greater pressure on businesses, jobs would be lost and business viability could be jeopardised.
Clearly, the previous Government was concerned by these findings, because it did not go ahead and implement a statutory requirement for redundancy. The previous Government had 9 years to do so, and it did not. That is very, very revealing. It had its opportunity when it introduced the Employment Relations Act 2000. It failed to do so, and that speaks volumes.
The Government, like the public advisory group, is concerned that mandatory redundancy provisions will destroy jobs and stop employers from hiring new staff. That would be totally counter to its commitment to create jobs. The Government is also concerned about the significant cost to business, which is not insignificant. We consider that this proposal would make redundancy unaffordable for most businesses, and there would be a real risk of businesses closing as a result. We will be opposing this bill.
KEITH LOCKE (Green): The Green Party will be strongly supporting the Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill. If it is passed—and I hope it is—it will correct a major injustice for workers in this country: being laid off without any redundancy. I think that David Bennett conceded there was a problem, but he said that under this legislation employers would stick to the minimum rather than giving more than that to workers in redundancy. However, the current problem is not that employers may stick to a legislative minimum, which does not exist; the problem is that they do not give any redundancy at all in many cases.
We have a recent statement from the National Distribution Union, referring to a dozen workers who were laid off by T A Macalister Ltd without any redundancy at all, because of a downturn in business. Warehouse supervisor Rob Highsted who was laid off said: “I feel bitter,”. “The warehouse in this company has been my baby - I was proud at how well I made it work, then they just say ‘piss off.’ Its 20 years of my life down the toilet.” Mr Highsted said another couple with 40 years’ service between them had also been shown the door, without so much as a thankyou from the company.
That is the problem that we face, and that is why it is important to have a minimum of 4 weeks’ notice, 4 weeks’ remuneration after 1 year, and 2 weeks’ additional remuneration for each subsequent year of continuous employment, up to a maximum entitlement of 26 weeks’ remuneration. That is consistent both with longstanding Green Party policy and, as has been pointed out, with the report of the Public Advisory Group to the Minister of Labour on Restructuring and Redundancy.
I will tell members why we have redundancy. One point is that it is a recognition by the employer, who has benefited from the labour of workers—often over many years, as in the case I mentioned—of the value of that work. It says “Here, have something, because, unfortunately, we have to make you redundant.” Secondly, it is to reduce the suffering that workers face when they are laid off. The unemployment benefit is not in itself sufficient, and there is a qualifying period for it, as well. That is particularly important now, when couples who work are mortgaged up to the hilt. If one person in the relationship loses his or her job, they cannot afford to pay the mortgage, the house goes down the tube—all kinds of things happen. There is huge suffering if people do not have any continuity of income while they look for another job. The third point is that it gives a breathing space to find another job—not just another job, but a job in one’s specialist area, if at all possible. It gives someone the time to look around to find an appropriate job. Often the problem is that workers are very highly specialised. They are geared to one job, and it takes a while either to train for something else or to look around for something that is the equivalent of what they were doing.
I myself was made redundant when I was working at the Gear meatworks in 1981 and it closed down. We got some redundancy pay, but I know that it was very difficult for many of the workers there who were highly specialised knife hands, and who had spent decades working as knife hands. Many of them became very depressed, and their families became depressed, because they did not have other work in their specialist area.
That relates to another issue raised in the public advisory group’s report: the need to give plenty of notice of the termination of employment. In this bill 4 weeks’ notice of redundancy is required, but there is also the need to look a bit further out. If something is happening to an industry, if a change is going on and there might be redundancies, there is a need to have a whole transition to new employment. That is why it is important to have adult education and not to cut night classes, which are often a way for people to make the transition to a new job. Unfortunately, this Government has cut night classes.
We want to be able to ratify ILO Convention 158, and it is important that we pass measures like this so that we can do that. We do not want to be in breach of international conventions.
The question is not that somehow workers will suffer through redundancy payments undermining full-time employment, as David Bennett claims. In fact, I think redundancy provisions are a deterrent against employers laying people off; it adds a bit of restraint, which is good. The idea that redundancy provisions somehow stop employers from employing people is a bit silly, too. How many employers think that in 3 years they might have to lay off employees and pay them 8 weeks’ redundancy, so therefore they will not employ them? That is not the way things would play out.
HONE HARAWIRA (Māori Party—Te Tai Tokerau): Kia ora tātou katoa e te Whare. I was checking out the website hardtimes.org.nz the other day. This website is pushing for a fair deal in hard times. It calls for people to sign a petition, hold a workplace meeting, or just to read the real-life stories of people who have copped a bad deal in redundancy. It sets out pretty much all the reasons why any decent citizen should support a minimum level of redundancy protection for all workers. What is being proposed here ain’t nothing flash: 4 weeks’ notice; and 4 weeks’ redundancy for the first year, and 2 weeks after that, up to 26 weeks. But the key focus of the bill is that a redundancy agreement should be part of every employment contract; that if we are really committed to a fair deal in hard times, then everyone should be entitled to basic redundancy protection to help them get by between jobs.
I do not know whether I buy into the exact details of the bill. I can recall a couple of years ago, when we were pushing for a minimum wage, being rudely reminded by my wife that if I was going to talk about a minimum wage, then I had to make sure that my kura, Te Rangiāniwaniwa, and the local iwi radio stations operating under Te Hiku Media, were actually paying according to the standards that I was preaching. So I had to have a sit-down with the bosses and go through the numbers. I found out that, in both cases, we were paying better than most other local businesses, but that we were not actually paying the minimum wage in certain cases. However, after a review of finances, some careful consideration, and some creative thinking, both Te Rangiāniwaniwa and Te Hiku Media were able to make some readjustments to ensure that everyone was being paid at least the minimum wage. I can tell members that that is no mean feat in a town that lies in the heart of the country’s highest Māori unemployment zone.
That is the challenge I have with this bill; I have not yet had a chance to get the folks at Te Rangiāniwaniwa or Te Hiku Media to run the numbers on this redundancy proposal, to see whether we can actually operate on the basis found in this bill. But certainly the principle of workers having redundancy protection to tide them over between jobs is a sound one, and one that both I and the Māori Party are more than happy to support. We support the Employment Relations Act 2000, we support amendments to make it more worker-friendly, and we support pay and employment equity legislation. So we certainly support the intention of this bill to provide all workers with the redundancy support to tide them over the tough times. Kia ora tātou.
The ASSISTANT SPEAKER (Hon Rick Barker): I call Hone Harawira. [Interruption] Oh, sorry.
Hon TAU HENARE (National): I know that we all seem to look alike.
The ASSISTANT SPEAKER (Hon Rick Barker): I call the Hon Tau Henare.
Hon TAU HENARE: That is something that we have been fighting against for a long, long time—but we will get there.
Chris Hipkins: Who’s the biggest loser?
Hon TAU HENARE: Well, if we want to go down that track.
I want to start my kōrero tonight with this quote from March 2000: “This bill marks a new era in industrial relations in New Zealand; an era that will be distinguished by a commitment to the fundamental principle that underlines all parts of this legislation—namely, that it is better to work together cooperatively for the common good in the workplace, than to work in opposition to each other.” That quote is from the then Minister of Labour, the Hon Margaret Wilson, in the Employment Relation Bill’s first reading on 16 March 2000.
Nowhere in that bill was there any mention at all of a redundancy clause—and that was in 2000. In 2009 there was an anniversary: the ninth anniversary of Labour taking office. Between 2000 and 2009 not one of the Labour members, including the former Ministers and including the backbenchers, ever raised the issue. Outside of this House, that would have been called hypocrisy, to coin a phrase of Trevor Mallard. Those listening outside would have called it hypocrisy.
The funny thing about the Fabians—there is always a funny thing about the Fabians and the Fabian Society—is that they never do anything when they are in power. But when they are in Opposition, they love to tell the Government what it should do. The Public Advisory Group to the Minister of Labour on Restructuring and Redundancy was established back then, but when I was a union member we used to fight for this sort of thing. We did not go cap in hand to ask the Government to do it. We did not even go cap in hand to the Labour Party and ask its members do it. We used to go and fight for it, unlike the pussies that the Labour Party has today. They think that the easiest way is to just front up to the Government and say: “Please sir, no sir, can I have three bags full, sir?”. That is their modus operandi; it is not about going to workers and saying: “Listen, what we need to do is organise. We need to talk, if we may, to the employer. Let us fight for something that we really believe in.”
What we see in the House tonight is nothing more than Darien Fenton and her mates in the Service and Foodworkers Union grandstanding, because they know full well that they cannot deliver on this bill, the Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill. Although they cannot deliver on it, somehow it makes them feel good. Like the do-gooders in the Fabian Society, they are a pack of pussy do-gooders. Quite frankly, I am over the moon. I am ecstatic that this Government is not going to buy into any of that Fabian rubbish.
JOHN BOSCAWEN (ACT): This is an impassioned debate. We have just heard an impassioned speech from the Hon Tau Henare, and earlier this afternoon we heard from David Bennett. This is an economic debate. It is a debate about employment. It is a debate about redundancy and redundancy provisions, and those things are very, very important. I think Mr Bennett impressed us all this afternoon with his knowledge of economic theory—who could not be impressed. I was very impressed.
Mr Bennett said to us that this measure would be a huge cost on business and that businesses would be reluctant to take on workers. Mr Bennett asked why we would want to make it harder for people to get a job, which is a very good question to ask. Mr Bennett said that this bill imposes costs on employers and that it would make them reluctant to take on new employees. Mr Bennett asked a very reasonable question: why would Labour members want to make it hard for Kiwis to get a job? It was a very reasonable question.
Why would National want to make it hard for Kiwis to get a job? If National members believe that imposing a compulsory redundancy provision on workers would have a negative impact on employment, why do they believe that imposing the costs of an emissions trading scheme and artificially increasing the price of electricity will not have the same impact on jobs? Mr Bennett asked who would want to place additional stress on business. Clearly, it is the National Government, because it is prepared to impose extra costs on businesses and exporters, and it wants to do that at a time when all our major trading partners are backing away from an emissions trading scheme.
Just last Tuesday the Prime Minister of Australia, Kevin Rudd, announced that Australia would be delaying the introduction of an emissions trading scheme until 2013. The United States does not have an emissions trading scheme, China does not have an emissions trading scheme. But what does National do? It continues to perpetuate the myth that our farmers and exporters will not be affected. The Minister of Agriculture, the Hon David Carter, has been telling farmers at field days that agriculture will not come into the emissions trading scheme until 2015. I call on Mr Carter, the Minister of Agriculture, to tell the truth to farmers. He knows that Meat and Wool New Zealand has said that the cost of the emissions trading scheme to dairy farmers will be about $10,200. There will be redundancies in the farming industry.
Meat and Wool New Zealand is telling farmers that under the emissions trading scheme they will have to start paying extra for electricity, petrol, and the emission costs of their dairy factories, but National is in denial. The Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill is an economic bill. It is about redundancies. We should be asking how we can stop redundancies, how we can recover from the recession, and how we can reduce our unemployment rate of 7.5 percent. The answer is to put in place economic policies that will create employment. We should ask ourselves why there is a need for Darien Fenton’s bill. How do we avoid that need? Do we have economic policies that make it easier for businesses to employ people and for us to trade our way out of recession?
I will leave the last word to the Hon John Key, the Prime Minister of New Zealand. Just 3 weeks before the last general election he said we should not be a world leader because that would come at the expense of our economy. He was obviously thinking of Darien Fenton’s bill and about the consequences of unemployment. He went on to say that he could see no sense in New Zealand exporting emissions and jobs to another part of the world. In the face of overwhelming change in the environment for emissions trading legislation and costs, and when all our major trading partners have pulled away from an emissions trading scheme—just last Tuesday Australia announced it was delaying its emissions trading scheme by 4 years—the National Government is charging ahead with it. National has its head in the sand. The Hon David Carter, the Minister of Agriculture, told farmers in Waikato this morning that we will proceed with the scheme. How stupid is that! I can understand why Darien Fenton thinks we need a bill of this nature.
CHARLES CHAUVEL (Labour): I will start my short contribution today by congratulating Darien Fenton on the success she has had in getting her bill out of the ballot, and on the effort she has gone to in doing something through this bill that if the House were to pass it, would represent us as doing the right thing. The bill implements the recommendations of the Public Advisory Group to the Minister of Labour on Restructuring and Redundancy, which reported back in 2008. That group recommended that it was time to put in place a modest entitlement, on a universal basis, for qualifying employees.
I practised in the area of employment law for many years before I came into this House, and not only is this bill a decent thing to do; it is a smart thing to do from the point of view of making the law certain. I will take the House through some of the developments that have been seen in the law in this area to explain what I mean by that. There has never been a statutory obligation in this country to pay redundancy compensation to an employee dismissed through redundancy, and that absence of a statutory obligation, at the time when we last went through major unemployment in this country back in the 1990s, caused major disruptions in employment law. It was not an issue during most of the term of the last Government, so it was interesting to hear Mr Henare’s contribution on that point. There was no need to legislate for redundancy in that area, because we had full employment. But, guess what, the House needs to remember that we are not in those times now. We are now in times where the rate of unemployment is over 7 percent, and this issue will have to be confronted by the courts again.
It is timely for the House to recall what the courts did in the absence of a statutory redundancy entitlement the last time we faced high and unlikely-to-decrease unemployment. I will describe some of the legal cases. First of all, from about the early 1980s onwards the courts looked at what used to be called the dispute of rights provisions in the labour law that prevailed at the time. There ended up being a number of cases over whether the dispute of rights provisions in the legislation could be used to confer a right on workers to redundancy compensation, when their employment contract, award, or agreement did not expressly call for that entitlement, or, if the contract did so, it did not specify how much redundancy compensation—or notice, even—they would be entitled to. Employers tied themselves up in knots trying to work out what the law should be in any particular case where an employment instrument mentioned redundancy but did not go further than that—it did not define an entitlement.
The courts did not give any clear guidance as to whether there was such an entitlement. In some cases, like the Wellington Hospital Board case in the early 1980s, the court indicated that, yes, there was such an entitlement. Then there was the Cornhill Insurance case, the Westland Catchment Board case, the Timbercraft case, and, finally, Westland again, this time in the Court of Appeal. All of these cases gave inconsistent results as to whether an employer had to pay redundancy.
Parliament took the matter in hand when it passed the Employment Contracts Act. Clause 34 of the Employment Contracts Bill, which became section 46 of the Act, did away with the ability to use the disputes process to get a redundancy compensation deal. But the courts were actually a step ahead of Parliament, because unemployment was still high and rising at that time, and 8 days before the introduction of the Employment Contracts Act, the Labour Court, in a decision called G N Hale and Sons Ltd v Wellington Caretakers IUOW—and in its second judgment in that case, following the matter being remitted from the Court of Appeal—decided that the personal grievance jurisdiction in the relevant labour law could be used to give a redundancy entitlement. All those same problems that arose under the disputes law applied for a number of years. Although, yes, it was deemed fair by the courts to pay compensation, there was never any clear guidance as to how much and in what circumstances.
We have the same provisions that applied then in our labour law at the moment, as far as personal grievances are concerned. The test is whether it is fair in all the circumstances to dismiss somebody. If the courts decide to swing the pendulum again, and decide there is an entitlement in the common law that redundancy ought to be paid to dismissed workers in certain circumstances, we will be back in that same position. No doubt this Parliament will swing in under this mean-spirited Government and just abolish the entitlement, but would it not be better to do the right thing: to support Darien Fenton’s bill and provide a modest entitlement on redundancy to workers dismissed for that reason?
CAROL BEAUMONT (Labour): Let me start by acknowledging my colleague and friend Darien Fenton. As Mr Chauvel has said, Darien Fenton has done a lot of work on the Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill, and for many years she has promoted the rights of workers in this country. I think that is worth putting on the record of the House.
I have been appalled at the contributions from members on the other side of the House. Mr Bennett went on about mandatory rules—mandatory this, mandatory that. He said the bill would undermine workers’ rights. I do not think there is an understanding of the importance of having in place strong minimum rights that provide guidance and the base on which we build. New Zealand has international obligations to provide a strong mandatory framework.
It has been fascinating to hear some members opposite trying to rewrite history. Mr Henare gave a very good analysis, except he forgot to mention what happened as a result of the Employment Contracts Act. He did not say that it ripped out the award system, which had provided quite significant redundancy coverage for workers in this country and left us in a situation where there was no statutory right and rights were limited to what people negotiated in individual or collective agreements. They negotiated their own rights. None of that was mentioned. Then we heard all that commentary about do-gooders but, frankly, if promoting workers’ rights and ensuring protections for workers in hard times is being a do-gooder, I am proud to be one; so are my colleagues.
This bill amends the Employment Relations Act to provide minimum statutory entitlements for employees in the event of dismissal for redundancy. I reiterate the point already made that this bill was a unanimous recommendation of the public advisory group on restructuring and redundancy. Employer representatives and union representatives understood the importance of having these protections, and at times of record job losses 80 percent of New Zealanders having no protection against redundancy is just plain wrong.
Members opposite still have the opportunity to do the right thing tonight for the 80 percent of workers in our country who do not have a right to redundancy protection. Redundancy entitlements will not replace a lost job but will certainly help workers, and their families, in the period until they have a new job.
I was interested today to hear the Minister of Finance say we are through the recession, but he should tell that to the 170,000 New Zealanders who are unemployed—7.3 percent compared with Australia’s 5 percent. Many more people are underemployed and are struggling to make ends meet. In the area of Auckland I work in, Maungakiekie, I talk to people who are struggling because they have lost their jobs, lost hours of work, or had little or no pay increases over recent times and are facing rising prices. We need to do something to send a message that this Parliament recognises that we are in hard times and that there should be minimum protections against redundancy.
This bill is particularly important at this time, but this Government has failed New Zealanders through hard economic times. It has failed in this recession to respond appropriately. Let us look at the rate of unemployment. It is not about just numbers; it is about people who are without jobs and are struggling to make ends meet.
There is a lack of empathy on the other side of the House, and there is certainly a lack of action. I compare that to just about every other country in the OECD, where active attention has been paid to job creation and the protection of workers’ rights—but not by this Government. This bill is about rebuilding a minimum code. This bill is about rebuilding after 9 years of a Labour Government where much was done.
Melissa Lee: We had 9 years of mismanagement.
CAROL BEAUMONT: I tell Ms Lee that in those 9 years Labour made regular increases to the minimum wage and put in place a number of employment protections. So members opposite should not try to rewrite history.
Many New Zealanders think there is a right to redundancy. New Zealand workers are, in fact, the cheapest and easiest in the world to sack. Is that something that members opposite are proud of? Are they proud that New Zealand workers are among the cheapest and easiest to sack in the OECD? That is not something they should be proud of.
This bill is about people. As others have said, it is about people who lose their jobs, who struggle, and who have to deal with the emotional consequences as well as the financial consequences. I urge members opposite to take this bill seriously and do the right thing.
DARIEN FENTON (Labour): First of all, I want to thank the Green Party and the Māori Party, and, of course, my colleagues in the Labour Party, for their contributions and support. I appreciate very much their understanding that this is a situation of basic fairness; that the Kiwi way is to treat people fairly, particularly when they are vulnerable. I also put on record my thanks to the many people who have been in touch to tell me their stories or to offer their support. I acknowledge all of the unions and organisations that have backed the redundancy protection bill and who will continue to fight, alongside Labour, to ensure that this issue will be on the agenda at the next election. I mention them by name: the Council of Trade Unions, the Engineering, Printing and Manufacturing Union, the National Distribution Union, my own union the Service and Food Workers Union, the Dairy Workers Union, the Unite union, the Rail and Maritime Transport Union, Finsec, the Maritime Union, the Public Service Association, the Nurses Organisation, the New Zealand Educational Institute Te Riu Roa, and the Wellington People’s Centre. I want Government members to know that together these organisations represent 350,000 workers, plus their families. Today National and ACT have sent a strong message to all of those people that National and ACT do not care about them.
I also respond to the pathetic defence from members opposite who say that Labour had 9 years. I mentioned in my first speech on the bill that Labour actually did an awful lot about redundancy protection but it was not a priority, because people were not losing their jobs in the droves that they are now. For insolvency situations we made redundancy protection a priority. We also cut the tax rate on redundancy payments and we set up the advisory group, because we also want to do things based on good evidence. That is what the advisory group was about. Members opposite should not go on about Labour having 9 years, because we did a lot, there was a lot to do, and there will always be more to do. The fact is the Labour Party has more ideas and will take them to the next election.
This Government has failed working people again. It has failed to take the harsh edges off the recession as John Key promised it would. Wages are in decline, unemployment is skyrocketing, and workers cannot look forward to any support from this Government.
When this bill was drawn from the ballot last year I deliberately postponed its first reading. I wanted to make sure that the bill was not taken lightly by political parties, but unfortunately the speech made by David Bennett shows that the Government has utter contempt for the issues facing workers today. I wanted to make sure the bill was not taken lightly; I wanted to give National and ACT, and other parties, a real chance to show that they were prepared to listen to working people and their families when they say that not enough is being done for workers facing redundancy. Actually, I do not think they bothered, even though more than 120,000 of these postcards that I am holding up went to John Key’s office. I know they would have gone in the rubbish bin, but what about the cost to workers? We can talk about the cost to business but what about the cost to workers and the cost to their families?
Redundancy entitlements are about recognising that the loss of a job is not the fault of workers; they provided their labour in good faith to an employer and they have a risk of not finding a comparable job. We have had examples in the debate today. It also recognises the impact generally on the earning capacity of the worker. Redundancy entitlements can also act as a deterrent; I think some of my colleagues have referred to this. An employer might otherwise make a worker redundant without due consideration. For example, I am aware that many of the employers in the 9-day working fortnight programme—
Hon Darren Hughes: Ha!
DARIEN FENTON: Yes, I know. Many of them joined that. The cost of redundancy, of making their workers redundant, made them sign up to it. It acted as a deterrent. It was not John Key’s brilliance; it was the fact that something stood in the way of them being able to just send people down the road. I have noted that in the last year personal grievances in relation to redundancy have doubled. That is the consequence of not having certainty in the law around redundancy. The cleaners who work in this Parliament have no redundancy payments in their agreement. They have a specific clause that says that they do not get anything. This is legal in the current situation, and common. Yet all of us in this Chamber can be made redundant at every election, but we get paid 3 months’ salary.
A party vote was called for on the question, That the Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill be now read a first time.
Ayes 57
New Zealand Labour 43; Green Party 9; Māori Party 5.
Noes 64
New Zealand National 58; ACT New Zealand 5; United Future 1.
Motion not agreed to.
DARIEN FENTON (Labour): I seek leave to table a redundancy notice to the Hon John Key saying that he will receive no notice and no redundancy pay because the law says he is not entitled.
The ASSISTANT SPEAKER (Eric Roy): That is not an acceptable document for tabling.
Bills
Smart Meters (Consumer Choice) Bill
First Reading
DAVID CLENDON (Green): I move, That the Smart Meters (Consumer Choice) Bill be now read a first time. At the appropriate time I intend to move that the bill be considered by the Commerce Committee. The genesis of this bill is, in part, a response to a report published in June last year by the Parliamentary Commissioner for the Environment, Dr Jan Wright, entitled Smart electricity meters: How households and the environment can benefit. This bill would give effect to the recommendations of the commissioner. It would do that by ensuring that all meters have functionality enabling them to automatically control loads and talk to smart appliances, and by requiring installers to give consumers the choice to have real-time information about their electricity use and variable tariffs, so that they can make use of that function if they wish to. The bill would also ensure that a variety of tariffs is available to consumers.
It is known that new meters are currently being installed in households as part of a replacement programme for very old equipment. The meters being installed through that programme are being described as smart. Although those meters are indeed capable of adding value by providing services useful to power companies, they are not capable of delivering much of anything to consumers. This bill seeks to remedy that imbalance by ensuring that meters that are installed are genuinely smart, and will provide choices and benefits to consumers as well as to the providers of electricity.
The much less smart meters being rolled out now allow power companies to use them for remote meter reading. They avoid the need for meter readers to go into homes. That cuts costs for the companies, but that saving may or may not be passed on to consumers. The meters also allow companies to data mine about the consumer’s user profile and consumption patterns, and enable remote disconnection or reconnection of supply. Although those are useful benefits for the providers, the same meters—the same hardware, in effect—could be installed quite simply and cheaply with the capability to enable consumers to manage their power load to minimise cost on a differential or cost-reflective tariff. As well as saving households money, which is one of the core features and intentions of this bill, that would benefit the nation by making better use of installed energy-generating capacity, by delaying the need for extra generation, and by reducing carbon dioxide emissions from coal and gas stations, because they would be required to run less often. The key difference between what is currently being rolled out and what we would like to see rolled out is the addition of a home area network capability, enabling the functions that can deliver sustained demand reduction and reduce cost to the consumers through load shedding and load shifting. The cost of ensuring that meters have this capability when they are installed is very low. To retrofit them later, as has been proposed by some, would be much, much more expensive.
The Electricity Commission was charged with investigating whether the roll-out of advanced metering infrastructure—effectively, smart meters—should be regulated, and it came back with a recommendation that “it is not necessary to extensively regulate the roll-out …” of those meters, as “the benefits of regulation do not outweigh the costs.” We have no quarrel with that part of the commission’s findings, to the extent that the regulation proposed in this bill is deliberately very light-handed, doing only enough to secure the necessary degree of standardisation and to ensure consumers are offered the opportunity to exploit the benefits of the technology. The Parliamentary Commissioner for the Environment, in a briefing note signed by the heads of a number of consumer-owned and council-owned lines—or distribution—companies, advocated for a somewhat more stringent approach to regulation. The companies saw the installation of smart meters as a significant building block towards a smart grid, which is already an objective in Australia, in many European countries, and in parts of the US.
The Electricity Commission notes that one of the primary drivers of smart meter installation nationally is to enable load management, in particular allowing peak loads to be manipulated and levelled, thus reducing the pressure on that critical peak-load capacity. The commission’s report notes also that “New Zealand has had an effective centralised load management system (the ripple control system) in place since the 1950s.”, but goes on to concede that “the ability to enable more controllable load does make AMI systems attractive.”—considerably more attractive than the very old technology. The ripple control system we have is a very blunt instrument, a one-trick pony, and the new technology would allow for a much more comprehensive array of load management options.
Clause 4 of the bill states: “The purpose of this Act is to empower domestic consumers to better manage their electricity use by requiring providers of smart meters to inform the domestic consumers of their options when upgrading to smart meters, and setting minimum requirements for the provision of smart meters.” It is important to note that nothing in this bill obliges any consumer to adopt any of the new options. There is absolutely no obligation on consumers to accept or take on any extra cost; they simply must be given a choice. The cost to the company of offering that information at the time of installation would be negligible.
One of the options a company would be required to offer to a customer is an in-home display—effectively a small screen inside the home that displays in real time the current tariff in cents per kilowatt, the current rate of consumption, and the current use for the day in consumed dollars and in kilowatt hours. It is a very simple read-out that can sit conveniently in the home. We know from experience that, where these have been trialled in business premises and domestic situations, such a real-time display works as a constant reminder to consumers of their consumption and is a prompt for them to turn off unnecessary, non-essential consumption at that moment. The units are a really effective mechanism for initiating and embedding long-term behaviour changes in energy use and conservation. That will benefit the individual consumer, and, again, will reduce demand, particularly for peak generation.
The bill requires retailers to offer to consumers the choice of a cost-reflective tariff, an average-price tariff, or a low fixed-charge tariff. Those who are currently on the low fixed-charge tariff will be able to stay on that tariff if that is their preference. It is entirely in a consumer’s hands. The cost-reflective tariff is a tariff where the customer pays a different rate according to the time of the day the units are consumed. Those types of tariffs can be designed to closely signal the network cost—the generation cost—of the electricity being consumed at any given time. The average-price tariff is simply a tariff where the consumer pays the same fixed rate for each unit of electricity consumed, reflecting the average cost of generation across the 24-hour period. The low fixed-charge tariff is an average price offered to people who consume low amounts of electricity, as defined in the regulations. That spread of options will allow householders to select the model that best provides for their needs, whether they have large households with a relatively high demand—as with growing young families, perhaps—or small, low-user households, such as with older couples, who have lower needs and a lower demand for electricity.
All we are seeking to do with this bill is to combine available, well-proven technology with some options being offered to consumers, to enable them to make intelligent choices and so reduce their costs. The bill is appropriately titled a consumer choice bill. It suggests we use the readily available technology. In that way, we can reduce the need for add-in generation, with all the social, environmental, and financial costs inevitably associated with that. I commend this bill to the House.
AARON GILMORE (National): Members might remember the issue of VHS versus Beta in the 1980s. They might remember Microsoft’s Internet Explorer versus Netscape in the 1990s. They might remember the recent thing about the Sony Blu-ray Disc versus Toshiba in the 2000s. The issue of smart meters in the Smart Meters (Consumer Choice) Bill is a very similar situation. All aspects of technology that are common today have eventually become very well adopted. But in their time, particularly in the early stages of technology like smart metering, a lot of confusion existed about whether we had jumped to the right standard of technology. That is why National will not be supporting this bill.
It has some good aspects; I must commend the member for bringing it to the House. I will touch on some aspects of the technology in the bill, but I believe that the bill will compel New Zealand to make a choice today on a set of standards and technologies that is not quite there yet—an idea whose time has not yet come. I will touch on that. People have a lot of confusion about what a smart meter is. Recently in Canterbury, Meridian Energy has been rolling out what are called by the Parliamentary Commissioner for the Environment “almost smart meters”. Some people call them smart meters; in other places they would not be called smart meters. It depends on people’s situations. In other countries, particularly in Europe and even more particularly in Italy, significant numbers of smart meters have been rolled out—tens of millions of them. But very different standards exist across the world. Recently in other parts of the world—like Germany, the United Kingdom, and Canada—we have seen the roll-out of smart meters. Nearly every single one of those countries has rolled out a different form of technology and a different set of standards, and that is one of the issues National has with this bill.
As the previous speaker, David Clendon, talked about, we have seen that New Zealand was a world leader in what was called ripple control mechanisms. In fact, in the 1950s and 1960s we were one of the first countries in the world to bring in ripple control. That mechanism allows consumers to control their hot water load, and it was a very useful hot water load management system. New Zealanders have used that technology and sold it in many places.
There is an issue with metering generally in New Zealand. Many of the ferrous iron - type meters that have been in place since the 1950s are coming to the end of their natural lives. That is why there has been some interesting debate about the issue of smart metering today. In Christchurch, where I live, Meridian Energy has made the call to put in place metering technology that will allow automatic meter reading. It will stop meter readers from having to go to consumers’ doors to read the meters on the wall. That is a good step. The technology for that is very well-developed and has been used very well across the US and in other parts of the world. We think that technology makes sense.
A lot of work has been put into these issues of smart metering, and particularly into the issue of how smart a metering device should be. I think we would all agree that in a perfect world we would have devices in our homes—for example, for our fridge or freezer—that would monitor the electricity use and turn an appliance off and on to take into account the load that might exist. I think we will get there, and that in our lifetime that will occur, but we are not there yet. Having the ability to jump to put in the meters what is called a home area network chip would cost a significant amount today. I accept that the marginal cost today would be quite low, relative to the expected benefits of that mechanism, but the reality is that consumers cannot bear that cost. That chip might cost a consumer anywhere up to an additional $200 to install today, but the benefit to that consumer of putting in place an in-house display on the meter, in the case of that chip, would be effectively zero. National does not feel that that is an appropriate thing to do at this time, when people have been facing record price rises in electricity over the last few years.
We believe that one of the things we have to think about is how we get this technology right to bring it through into the market. The Parliamentary Commissioner for the Environment wrote a report recently on metering. That report has been considered by the Electricity Commission and the Minister of Energy and Resources, and some guidelines have been put in place around smart metering. I am pleased to say that there has been some success in the roll-out of some of those smart meters. Some would say that that is not enough, but it is a start. Given what we have seen so far in the technology, I think that it is a good start.
I understand that there is some sort of fear over this issue, and particularly over the home area network chip. I spoke at the start about the issue of VHS versus Beta, Netscape versus Internet Explorer, and Sony Blu-ray Disc versus Toshiba. In each of those cases there was a winner and a loser in the field of technology. If we make a decision to jump to one standard today, when it is actually not clear whether that will be the dominant standard in the world, we will end up incurring a whole lot of unnecessary costs for the consumer. It would cost a couple of hundred bucks extra for the consumer, but that is basically a waste of money if the consumer has to spend that money again some time in the future. We do not think that that is the right thing to do. For example, the meters that Meridian Energy has put in at Arc Innovations in Christchurch have allowed the situation where in the future home area network chips could be put in, should that be the right technology to jump to. As that member has outlined in his bill, it may end up being the right technology to jump to in the future, but I think that idea has not yet been proven—it is not proven that it is the right place to go.
A number of regulations exist currently about the guidelines on metering by the Electricity Commission. In fact, a bill currently before the Finance and Expenditure Committee has been looking at a number of issues about electricity. This issue has arisen in passing. If the member had brought the bill before the House with some alterations, particularly in terms of the home area network chips and other things about tariffs, we might have been able to support it.
I will touch on one example of the tariffs the member spoke about. Again in Canterbury, the Orion New Zealand lines company has one of the most innovative sets of tariffs in the country. Up and down New Zealand there are currently something like 300 different types of electricity tariffs. The electricity reforms that the Minister of Energy and Resources is currently undertaking outline a series of regulations for the new Electricity Authority to formalise and make some changes in those tariffs, in order to bring together a simplification. I think that that makes some sense. But we have to be very careful not to put in place what is effectively more compulsion in other tariff rates, when it makes some sense to have some innovative tariff arrangements, particularly in Canterbury with the use of irrigation. I know that the Green Party has some particular concerns about irrigation, but tariff rates and the innovative tariff structures used by Orion actually help to reduce water use and power consumption. I think that is a good thing.
It is true that smart meters have the potential to reduce peak demand. They have the potential to defer the need for more electricity generation in the future, and to encourage people to change how they consume electricity through their appliances throughout their lifetimes. But there are smart meters and smart meters. As I outlined earlier, the question is whether we jump now to what is probably the wrong conclusion, or whether we wait and take into account a more cautious approach, to implement an arrangement whereby we would have meters that are more appropriate for New Zealand. New appliances will come on to the market from developers such as Fisher and Paykel, which is a world-leading developer of technology for appliances, and they will be able to access a standard of communication between meters and their appliances. That will be a good thing, but we are not there yet. I think this bill, in outlining some way of jumping that decision before the technology is there, is a move too far.
Finally, I reiterate the issue of costs. Some matters in this bill contain too much detail for a bill, and are probably better taken into account in terms of regulation. They are better taken into account in the electricity reforms we are undertaking at the moment with the electricity legislation, and I encourage the member to get involved in some of the final stages of those regulations and their development to make the current situation with the Electricity Commission and those guidelines more formalised. These reforms will take into account a big chunk of what this bill does, but will not take into account the tariff restructuring, the home area network chips, and the in-home displays, which we think are a cost too far. Thank you.
CHARLES CHAUVEL (Labour): I would like to begin by congratulating David Clendon on bringing the Smart Meters (Consumer Choice) Bill successfully to the House. It must be a record in the annals of the proceedings of the House for a new member to have a bill drawn from the ballot as quickly as he has managed to do.
Grant Robertson: Outrageous!
CHARLES CHAUVEL: Yes, the rest of us are very jealous of the success he has had. Labour will support this bill because we believe that New Zealanders ought to have more control at home over their power bills. Householders should have the opportunity to get a little more control over the cost of their electricity. Smart meters provide electricity users with the ability to monitor their power usage, and therefore to begin to exercise that greater control that we think they should have. The previous speaker is quite right. There are issues that need to be resolved. But the question is one of the chicken and the egg. Does the country wait until the technology is perfect, or do we give the technology a bit of a boost by specifying a standard now and helping the appliance manufacturers to know what they should be doing, as the Victorian Government has done, and roll out a proper series of appliances in the home that can connect to smart meters and start to give consumers the power we think they should have?
There is a real problem at the moment, as the previous speaker observed. There is no requirement at the moment for the smart meters that Meridian Energy and others are installing to have any home area network functionality. There is an excellent report on this issue from the Parliamentary Commissioner for the Environment, the servant of the House in this area, who has done meticulous research on the requirements that would be needed to make sure we could roll out smart meters in a way that provides choice to consumers. That is something we should take seriously. The Parliamentary Commissioner for the Environment has estimated that by 2012 retailers will have installed a total of 800,000 meters in this country without home area network capability—the feature that makes them smart. Without having installed a home area network chip, so that smart meters can communicate with other in-home appliances, consumers simply will not be able to take advantage of using power when electricity is cheaper.
The bill sets minimum standards for smart meters, to ensure that the meters being installed are actually smart. They should live up to their name. They should have home area network functionality, not just the capability to have them put in later on. As I said, this will encourage appliance makers to move quickly to put chips in fridges, washing machines, dryers, heat pumps, and dishwashers so that householders can programme them to use power most efficiently and to lower their power bills. The corollary of this development would be that power retailers would offer differential tariffs. When they were not able to sell a whole lot of power into the market, they could make that power available to householders, say at night, for cheaper rates.
This is the future of electricity usage. It is an important step towards smart grids. Smart grids use digital technology to upgrade the current system, and this will allow for much closer control of our electricity supply.
The Government has shown a consistent lack of interest in providing consumers with greater control over their power usage and encouraging greater energy efficiency. Last year the Parliamentary Commissioner for the Environment recommended that the Minister should specify a standard, as has now taken place in a number of overseas jurisdictions. I mentioned Victoria, and that is probably the closest relevant development. But Gerry Brownlee has just ignored those recommendations. He defends his decision because he says that the ripple control system on home water heating, to manage peak load, is an adequate substitute. In technology terms, Mr Brownlee’s decision is a bit like people saying they do not want an iPod because they still have a perfectly good collection of 78s.
In March 2010 Gerry Brownlee again rejected calls to establish a standard for domestic smart metering of electricity, in favour of allowing the industry to decide what is best. This refusal is a major missed opportunity to empower consumers. It is another example of the energy Minister just sticking his head in the sand. We can trot out all the excuses as to why we should not do this, but we are missing opportunities. I congratulate David Clendon on bringing this bill to the House. I hope we take the opportunity he has offered, to give consumers a bit of choice in the way they use electricity and to start making our electricity grid a lot smarter.
PESETA SAM LOTU-IIGA (National—Maungakiekie): I rise to speak on the Smart Meters (Consumer Choice) Bill introduced by my colleague the Green list MP David Clendon. I acknowledge his knowledge in this area. The Commerce Committee heard from the Parliamentary Commissioner for the Environment and various other submitters on this very subject. Obviously the bill’s aim is to give effect to some of the recommendations that the Parliamentary Commissioner for the Environment stated in her report. I must say up front that National will be voting against the first reading of this bill. “Advanced” meters I think is the proper term that should be applied to this because there are very few smart meters out there—not just in New Zealand, but across the world. Smart meters communicate with appliances in a really advanced way.
In terms of the development of the technology, advanced meters have changed electricity meters into complex systems. These systems are able to measure and record electricity consumption in almost real time. It makes that information available to the electricity market, its participants and, most important, its consumers. The benefits have already been espoused by previous speakers. Obviously it allows retailers to remotely read meters, without needing to physically access consumers’ properties. It provides consumers with accurate monthly invoices, not just guesstimates of what their bills will be. It also enables faster switching between retailers, reducing the barrier to entry for new-entrant retailers.
Smart meters have the potential to reduce peak demand, thereby deferring the need for investment in new generation, transmission, and distribution assets. As all speakers have alluded to, it could lead to cost savings for consumers, retailers, and distributors, enabling greater consumer participation in, and understanding of, the electricity market. The recent ministerial review of electricity market performance, led by the Hon Gerry Brownlee, endorsed the introduction of smart meters in New Zealand because of the benefits they will bring. But the key point is that the Government supports the introduction of smart meters.
In terms of the current regulation around smart meters, some aspects of metering are regulated under Part D of the Electricity Governance Rules. The roll-out of smart meters is unregulated. However, the Electricity Commission issued guidelines in May 2008 that recommended minimum standards for smart metering systems. These guidelines are recommendations only. The Electricity Commission, of course, reported to the Minister in December 2009 about the regulation of smart meters. The commission’s overall recommendation is that it is not necessary to extensively regulate the roll-out of smart meters, because, and this is the critical point, the benefits of regulation do not outweigh the costs. Let me repeat that, for the benefit of members opposite. The benefits of regulation do not outweigh the costs. The commission considered that some technical aspects of smart meters addressed only in the current voluntary guidelines should be regulated. Those regulations are being progressed as part of the fundamental review of the electricity market rules, as my colleague has alluded to.
Why should we not support this bill? Well, some of the bill’s provisions are unnecessary because of widespread compliance with the voluntary guidelines on smart meters. There are technical matters contained in the bill that are inappropriate for primary legislation. They can instead be advanced through the rules made by the new Electricity Authority. The bill is also inconsistent with the expert advice of the Electricity Commission that we have all spoken about. It recommended against the extensive regulation of smart meters. Passing this bill would impose extra cost on consumers, who are still reeling from the electricity price rises under the last Government. What were those price rises? I will remind the House. Prices rose at three times the rate of inflation—75 percent over 9 long years of the Labour Government.
CHRIS HIPKINS (Labour—Rimutaka): There we have it. National, the party that purports to be the party of choice, is denying consumers the choice to have lower power bills and to save money on their electricity. National purports to be the party of choice, except when it comes to giving ordinary working New Zealanders any choice over saving money, those members do not want a bar of it. At a time when prices are continuing to go up and we have low, low rates of wage growth under this Government—the lowest in almost a decade—National does not want to give people the choice of saving money on their power bills. That is what this Smart Meters (Consumer Choice) Bill would do. It is a very good bill from our colleagues in the Green Party, it is supported by the Parliamentary Commissioner for the Environment, and the National Government is turning its back on it.
Those members do not care about the evidence. They do not care about giving people choice. They want to take the Gerry Brownlee “we know best” approach and not give people the choice. National members do not care about energy efficiency at all. We saw that from the minute they took up the Treasury benches, when they repealed the restriction on new thermal generation. They repealed laws on biofuels. They slashed the $1 billion home insulation fund that would have given so many New Zealanders the opportunity to save money on their power bills and to live in warmer, drier homes. That all went out of the door as soon as National got into office and as soon as Gerry “Sexy Coal” Brownlee became the Minister of Energy and Resources.
The ASSISTANT SPEAKER (Eric Roy): Order!
CHRIS HIPKINS: He does not want to reduce our use of energy because that would reduce the market for coal, which he wants to go around pulling out of the ground to turn into electricity. Mr “Sexy Coal” Brownlee—
The ASSISTANT SPEAKER (Eric Roy): The member will use proper names.
CHRIS HIPKINS: Gerry Brownlee wants to mine our national parks. Gerry Brownlee’s motto is “When in a hole, keep digging”. He thinks that the future of New Zealand is not in energy efficiency and in giving consumers the ability to control their power bills, but in digging up more fossil fuels and burning them to produce electricity.
Members on this side of the House say that that is not a sustainable future for New Zealand. We need to look at more sustainable energy and electricity generation, and we need to give consumers the ability to reduce their energy consumption, should they wish to; to spread their energy consumption; or to make use of cheaper electricity. What is Gerry Brownlee’s answer to that? He says that we have ripple control. The 1970s solution to energy efficiency is good enough for Gerry Brownlee. As Charles Chauvel said, it is a bit like saying that we do not want an iPod because we have a perfectly good set of LPs.
The Government is not interested in the latest technology that can give people choice. The Government is going against all of the international evidence. In fact, we can look at what the Conservatives in the United Kingdom are doing. David Cameron, that great Conservative icon for the National Party, stated: “We have got this big 1960s grid but it’s a dumb grid, and we need to make it into an intelligent grid.” That was David Cameron. He said that a smart grid is “the equivalent of the internet, rather than an old phone system.” That is the Conservative Party in the UK.
The UK Conservatives, who are not even in Government—at least, not at the moment—are miles ahead of the National Government here, which has had 18 months to do something to lower the price of electricity for consumers and it has done nothing. National members went up and down the country during the last election campaign promising people lower power bills. Where are they? The Government has had a year and a half. The price of electricity has not come down; it has continued to go up. Instead of lowering power prices, the National Government is denying consumers the right to cut their power bills by being able to have smart meters.
Thousands of new meters are being installed in households as we speak. Consumers are paying for the new meters already, so the rhetoric from National that specifying a standard would load more costs on to consumers is not correct. Consumers are paying already. The meters are already being installed, just not to a consistent standard, so there is no guarantee that they will be compatible. There is no guarantee that the electricity companies installing the meters will not use them as a competitive advantage to stop consumers switching electricity companies. Specifying a standard would give consumers more choice. It would allow them to lower their power bills. This Government is denying people that choice. It is denying hard-working New Zealanders the chance to have lower power bills.
JOHN BOSCAWEN (ACT): That was certainly an impassioned plea from Mr Chris Hipkins in this debate on the Smart Meters (Consumer Choice) Bill. It would seem that the debate has broken into one on the electricity industry, the price of electricity, and energy conservation. I will start by saying that the ACT Party will not be supporting this bill.
Chris Hipkins: What a surprise!
JOHN BOSCAWEN: Well, we approach things with an open mind, I tell Mr Hipkins, but we are following the logic that Mr Gilmore outlined. He made the point that if we go back to the 1980s and 1990s, we go back to the debate between VHS and Beta. We go back to the debate between Microsoft and Netscape. One could have taken a gamble and decided which type of technology to pursue, but one would have made a mistake in doing that. I think Mr Gilmore has outlined very clearly that that would be a foolish thing to do at this stage.
It was particularly interesting that Mr Sam Lotu-Iiga talked about the 75 percent increase in the price of electricity during the term of the previous Labour Government. He said that Labour is now crying crocodile tears over the National Government’s lack of support for this bill. I think it is very important to remind ourselves that there was a 75 percent increase in the price of electricity over the last 9 years. That is three times the rate of inflation. So what is this Government doing about it? It will increase the price of electricity even further. It will increase it even further, because we have an emissions trading scheme starting on 1 July this year. It is being extended to the stationary energy sector, which Treasury says will add 5 percent to the price of electricity. I know that Mr Hipkins is concerned about that, because he is concerned about the price of electricity rising, but he ignores the fact that his own party would have increased electricity prices by 10 percent if it had won the last election.
The ACT Party, and only the ACT Party, questions the logic of having artificial increases in the price of electricity at all. Why would we proceed with an emissions trading scheme when none of our major trading partners is prepared to impose those same costs on their consumers, businesses, and exporters? I know that this issue is of concern to all New Zealanders and particularly to people living in rural areas. I have just finished a 2-day tour of the Waikato and Taranaki. I had seven public meetings, and I was stunned by the response and by the number of people who wanted to come.
Mr Clendon talked about the current roll-out of what he would call dumb meters. I understand Mr Clendon’s concerns, because when the Parliamentary Commissioner for the Environment raised this issue with the Commerce Committee last year, I also wondered at the wisdom of doing that. But I was persuaded by the arguments of Mr Gilmore and the National Government that to proceed when there is so much uncertainty as to the way the technology will go would be unwise. Mr Clendon said that the advantage of having the meters that are currently being installed is all one-way. The generators have an advantage because they will be able to read these meters to automatically calculate accurate power bills. I think that is an advantage for the consumer, but Mr Clendon argued that the consumer will get no additional benefit.
Sitting suspended from 6 p.m. to 7.30 p.m.
TE URUROA FLAVELL (Māori Party—Waiariki): Tēnā koe, Mr Deputy Speaker. E te Whare tēnā tātau katoa. Kātahi anō ahau ka hoki mai i te nehu o tētahi o ngā uri o roto o Ngāti Manawa, ko Bill Bird tērā. Koia tērā i whakatakotohia ki roto i te rua kōiwi o ngā mātua tūpuna o roto o Ngāti Manawa, i Murupara. Nō reira, e tika ana kia tuku i ngā mihi nui ki a ia kua riro ki tua o te pae. Nō reira, waiho ia kia moe, kia okioki.
Ko tā tātau ko te wānanga i ngā take o roto i te Whare Pāremata i tēnei pō. Me kōrero au mō te āhuatanga ki a Murupara. I a au i Murupara i te rangi nei ehara i te mea, he hāngai tonu ō rātau whakaaro i tēnei rangi tonu nei ki tēnei pire. Ko tā rātau i a tātau e kōrero nei mō tēnei mea mō te hiko, ko tā rātau e whakaaro nui nei, mō te moni hei utu i ngā nama. Ehara i te mea mō te mītā, ehara i te mea mō ētahi atu take, kāo. Ko tā rātau, ko te kimi moni kia taea ai e rātau te utu ngā nama e pā ana ki te hiko.
Ehara i te mea he nui wāku kōrero mō tēnei take. E ai ki ngā kōrero kua puta ki te komiti whāiti o te Commerce Komiti, i tae mai wētahi kōrero mō tēnei kaupapa, mō te smart meters. Kāre au i te mōhio, mēnā i tētahi taha ko te smart meter, ko tētahi taha ko te dumb meter, aua hoki. Engari i tōna mutunga mai, e ai ki ngā kōrero he kaupapa pai tēnei hei āwhina i te hunga e whakapau moni ana mō te hiko nā runga i te mea tuatahi, he āta titiro ki te moni ka whakapauhia i runga i te hiko, ā, ka mutu, tērā pea nā runga i tērā āhuatanga, ka kore rātau e tere whakapau moni i runga i te hiko, ka mutu, ka āwhina i a rātou ki te āta tiaki i te pūtea kai roto i te pūkoro. I tōna mutunga mai, te tūmanako ia ka whakamāmā i te āhuatanga o tēnei mea te hiko mō tēnā, me tēnā o roto i ngā hapori, kia kore e raruraru nā runga i te taumahatanga o ngā pire kei runga i a rātau.
He paku āwangawanga nō mātau nō roto i te Pāti Māori, ana ko tēnei nā. I ngā tau kua hipa kua rongo mātau, ā, whakakīkīngia ngā roto o Te Wai Pounamu mō te hiko, ā, ka mutu, ko ngā kamupene nui, ko rātau te hunga ka whiwhi pāinga nā runga i tēnei mea o te hoko hiko. Ka pātaia te pātai, e, mēnā koi rā te āhuatanga ko te nuinga o te moni ka haere tonu ki roto i te pūkoro o ngā kamupene nui, he aha tā rātau ki te hapori, ki a Aotearoa whānui tonu? Koi nā te pātai nui. Hē āwangawanga tonu nō roto o te Pāti Māori i te mea, mēnā ka pērā, e aroha atu ana ki te hunga e rongo nei i te pōharatanga, e rongo nei i ngā uauatanga o te kore moni nā runga i te kore mahi, ka mutu, ā, koi nā te āwangawanga nui.
Ā, kāti, ka tautoko ake i tēnei pire. He poto noa ake taku kōrero engari, he whakatakoto i ēnei kōrero ki mua i te aroaro o te Whare Pāremata i tēnei pō. Kei wareware i a tātau, ko te hunga rawa kore, ko te hunga kore moni, kore mahi nei i te mea, tōna mutunga mai, ka riro anō rā mā rātau ngā nama e utu. Mēnā he āwhina tēnei ki a rātau, kia āta tiaki pai mai i te āhuatanga o te moni kei roto i te pūkoro, e tika ana kia tautoko ake. Nō reira, ka waiho ake ngā kōrero ki reira, me te tautoko ake i tēnei pire i tōna pānuitanga tuatahi. Kia ora tātau.
[Greetings to you, Mr Deputy Speaker, and to us all, the House. I have just returned from the burial of a descendant of the Ngāti Manawa people. That person was Bill Bird, and he was laid to rest in the cemetery of his Ngāti Manawa ancestors in Murupara. Therefore, it is apt that tributes of the highest order be placed upon the one who has passed beyond the horizon. Allow him to slumber and rest there.
Our task is to debate the issues that are before the House of Parliament tonight. The thoughts of the people in Murupara today were, as expected, not focused on this bill. Their main concern, as we debate the issue over power, is about where the money is going to come from to pay the bills. It is not about meters, or any other issue, absolutely not, but to find the money to pay the bills relating to electricity.
I do not really have a lot to say about this issue. According to some reports from the Commerce Committee, submissions about this policy relating to smart meters were received. I am not exactly sure whether the submissions were about smart meters, or dumb meters, or whatever. But at the end of it all, and according to the discussions, this is a sound policy in that it helps people who spend on power, because, in the first instance, it monitors the money being spent on power and conserves the funds in the pocket. The desired outcome is that it eases costs to the individual and spreads it more evenly over the whole community.
The Māori Party has a small concern, and it relates to this. We heard that the ones who reaped the benefits by storing waters in South Island lakes and selling the electricity generated from that in the past were the huge power companies. The question then is, if the majority of the money continues to go into the coffers of big power companies, what is their contribution to the community and to New Zealand at large? That is the big question. It is a real concern for the Māori Party, because if that is going to be the case, we pity the ones struggling to keep above the breadline and struggling to find work. It is a huge concern.
That aside, we support this bill. While my contribution is a small one, I have at least expressed it before the House. We must never forget those without means, money, and jobs, because eventually they are the ones left to pay the accounts. If this bill is of some help to them in terms of stretching the money in the pocket, then it is right that it be supported. So I leave my comments there, and endorse this bill at its first reading. Greetings to us.]
Dr KENNEDY GRAHAM (Green): I take pleasure in rising to support David Clendon’s Smart Meters (Consumer Choice) Bill. The purpose of the bill is to empower domestic consumers to better manage their electricity use. The mechanism to achieve that is twofold: first, by requiring the providers of such meters to inform domestic consumers of their options when smart meters are about to be installed; and, second, to set minimum standards for the provision of smart meters.
As the title of the bill indicates, this is all about consumer choice. It must, therefore, be clear that this Government would be positively predisposed to support it. I note that earlier in this debate Sam Lotu-Iiga acknowledged that his Government supported the introduction of smart meters in themselves, but, alas, not this bill.
The Minister of Energy and Resources has expressed a concern that the bill imposes over-regulation on the industry. But the Parliamentary Commissioner for the Environment and the chief executives of six major lines companies have called for far more stringent regulations than are proposed in our bill. Under the bill, one of the requirements for smart meters in this country is the provision of a home area network, as has been acknowledged. This is a chip that can be installed inside the smart meter that would enable any electric or electronic device to communicate with the meter. The Minister, along with the Electricity Commission, recommends against proceeding with these chips. But if the bill is voted through to the select committee, this issue can be explored. We could perhaps accept deletion of this provision, although it is not easy to follow the logic of the argument against that.
The basis of the cost-benefit analysis against such chips, assessed by the New Zealand Institute of Economic Research, was highly skewed against them in three ways: first, it used retail prices for the costs and wholesale prices for the benefits; second, it downplayed the electricity savings by 80 percent, compared with the studies it quoted, without giving any substantive reason besides suggesting that somehow New Zealand was different; and, third, it used the retail price for the home area network chip, but, in fact, the chip comes pre-installed in the meter, which makes a difference of $65 per unit.
In the United States there is some public concern over the accuracy of smart meters, resulting in calls for regulation. Our bill does not require regulation; it just gives the Minister the authority to regulate, should that be needed. It has been argued that appliance manufacturers must move on a protocol first, before smart meters do. I note that Aaron Gilmore earlier in the debate expressed concern about the different standards prevailing, and concern about uncertainty over the precise technology that might apply in the future. Yet we understand, from at least one major manufacturer, that until the smart meter protocol is mandated, they will not move to develop the interface. That is why other countries are mandating a protocol by way of regulation. Only this initiative will get things moving. Of course, there may be problems of obsolescence down the line, but the chip socket will still be in place, so the chip can be upgraded at less than total cost.
Does the Government truly believe that the cost-benefit analysis of the consumer aspects of smart meters will not pay? Does it believe that it will be 10 years before they are fully functional? If so, the Government should introduce a moratorium on their installation. Otherwise, the extra costs that retailers are charging to customers for smart meters that are of no use would be indefensible.
This bill is about making New Zealand a smart economy. It is about using high tech to make us warmer, more efficient, and less polluting in our lifestyle. It gives the consumer the option of choice. The only thing standing between households and the absurd power price increases we are all facing is this bill. There can be no sound reason to oppose the bill. Any refinements that are warranted can be agreed to in the select committee. I call upon Government members to support the bill still, at this stage, and work with the Green Party to make it become law.
KATRINA SHANKS (National): I rise to take a call tonight on the Smart Meters (Consumer Choice) Bill. National is voting against the first reading of this bill. We have heard a lot of talk about what smart meters are, what they can do, and how good they are. Smart meters are good, and this Government supports their introduction. But we have to make a distinction between smart meters and advanced meters. In New Zealand we have advanced meters. Smart meters are an emerging type of technology that is still coming into the market, still being commercialised, and still being put into products that we can use. But in New Zealand, we are not quite there. In fact, it may not be wise to make regulations and pass legislation to make happen something that is not in existence now, and that maybe will change significantly the way it is delivered or as technology changes. There might be a great big shift. If we are going to regulate and enforce something, why do we not wait until we have smart meters in New Zealand and see what they look like?
Although some aspects of metering are regulated under Part D of the Electricity Governance Rules, the roll-out of smart meters is still unregulated. However, the Electricity Commission issued guidelines in May 2008 that recommended minimum standards for smart meter systems. The guidelines are recommendations only; participants are not required to comply with them. But many, many organisations already are gearing up to do so, and many are already in that space without being told they have to do it and without having this legislation.
What does the report say? The Electricity Commission report, which is the most recent information we have, was reported back to the Minister in December 2009. The commission’s overall recommendation was that it is not necessary to extensively regulate the roll-out of smart meters because the benefits of regulation do not outweigh the costs at this stage. The last thing this country needs is increased electricity prices. The last thing this country needs is another law put in place that will make the costs for those users go up even higher. Now is not the right time for a bill like this.
What does the bill do? It requires providers of smart meters to offer to consumers, before the installation service or upgrade of any domestic smart meter, an in-home display unit, import and export capability, and the choice of particular types of prescribed tariffs. It sets out minimum requirements for smart meters, such as that they must include certain components and features that accord with the Electricity Governance Rules, the means to control any existing hot water cylinder, various other features, and, crucially, home area network functionality, not just capability—and there is a difference there. The bill also introduces regulation-making powers for the purposes of assisting domestic consumers. This is already happening in certain areas, without this legislation having been passed.
Some of the reasons why the bill’s provisions are unnecessary are that there is widespread compliance. There are already voluntary guidelines on smart meters. The technical matters contained in the bill are inappropriate for primary legislation, and can instead be advanced through rules made by the new electricity authority. Maybe there will be a time and a place for this legislation, but the industry is already doing all right on its own. We do not need to interfere at this stage. Thank you.
CLARE CURRAN (Labour—Dunedin South): Poor value for money—that was the Treasury advice on the Government’s so-called jobs package last August. Do we have more jobs? No, we have fewer jobs, and 168,000 people are unemployed. More jobs are disappearing offshore every day, and the Government has refused to invest in jobs and skills.
The fact is that this Government is not very smart, but here we are talking today on a bill about smart meters that is intended to put the power back into the hands of consumers. The Smart Meters (Consumer Choice) Bill is timely, and it should be supported. Unfortunately, it will go nowhere, because we have a Government that is stuck in mundane and bland thinking. It does not see its role as being to invest in skills and jobs, let alone to promote new technologies to deliver new policy directions and transform our economy and society. I will talk about smart thinking, something this Government does not do. I am deadly serious about it, because if we do not do some smart thinking, then we will stand still as an economy.
The communications revolution means massive changes in the way that we live, work, and communicate, which has an impact on health care, education, and environmental services. It requires collaboration between various industries, such as utilities services, the telecommunications companies, and the information technology sector. I wish that I could stand here in this House today and say that is what is happening in this country, but unfortunately it is not.
Despite a big plan to put $1.5 billion into ultra-fast broadband, this Government is doing very little thinking about what it will use that broadband for or about how it can drive demand and help transform our society to deliver better education, health services, and energy services through new technology. Instead, that thinking is going on in Australia. Its smart thinking is being led from the top. The Rudd Government has made the connection between smart meters, new technology, and energy efficiency, and the importance of having the Government drive change for the good of all society.
In Australia a fundamental shift has taken place in environmental policy since 2007. That has had a huge effect on the utilities market. For the information and communications technology and the energy industries, Government initiatives on smart meters and national fibre telecommunications networks are moving in new directions, such as towards smart grids. By mid-2010 the outlines of Australia’s first smart grid project should become visible, starting in Victoria. The major players are mostly large energy retailers and producers, supported by information technology and telecommunications firms.
The Australians grasp that smart meters should only be considered in the broader context of the modernisation of electricity networks that introduced sensing communications and information technology on to the grid. Reputable Australian telecommunications analyst Paul Budde has talked about trans-sector thinking. He has talked about how the Australian Government is leading on all infrastructure projects and on the potential synergies between the building of roads, sewerage systems, and water and gas pipe networks, and telecommunications and electricity networks. The concept of smart communities is based on intelligent infrastructure, such as broadband and smart grids.
In this country one would hope that there would be smart thinking by our Government to go with the delivery of broadband, and that the Government would think of putting broadband in place to make sure that people in communities are better connected, with services that link their homes to broadband. What are we doing as a Government to make that happen? Well, stuff-all, as it happens.
I sit on the Commerce Committee. Last year a stream of State-owned electricity companies came before the committee for their financial reviews: Meridian Energy, Genesis, Mighty River Power, Transpower, and the Electricity Commission. I asked every one of them the same question, and I got virtually the same answer from each of them. That question was whether, given that the efficient use of electricity and saving power is a key issue for our time, any more work was being done on it, and whether the organisation was doing any thinking about where we are going next. The answer, consistently, was: “Not much.” Then I asked whether they were aware of the work being undertaken in Australia and other countries on smart grids and whether they were doing any thinking about that. The answer was “Yes” to the first part of the question, and “Um, no” to the second part. I rest my case. No smart thinking is being promoted by this Government in the electricity industry.
There is a huge opportunity to use this bill to propel thinking about how to better use smart meters. We could use new technologies to build smarter communities, to save people on their fuel bills, and to save energy.
DAVID CLENDON (Green): Kia ora koutou. I will begin by thanking those members who have spoken in favour of the Smart Meters (Consumer Choice) Bill, particularly the Labour and Māori Party spokespeople; that demonstrates the forward-thinking and progressive nature of those two parties. It must be said of some of the opposition comments that members have shown damned good “faint praise” in recognising that many of the benefits we are proposing for the installation of smart meters are in fact very real. Nevertheless, they are choosing to vote against offering choice to consumers.
There seems to be a strange phenomenon around electricity prices. In years when the hydro lakes are dry we are told the power price must go up, but in years when they are full the power price must still go up. We bring in more renewables, and electricity prices go up. When we fire up the old coal burning stations, there seems to be some strange economic alchemy that demands that electricity prices must continue to rise. This bill would not be the entire solution to electricity pricing and to managing that, but it would be one significant and very positive step towards giving consumers the ability to manage their usage and cut their costs. It is a great shame that the Government tonight is demonstrating its failure to protect householders from rising electricity prices by voting against this very sensible and very timely bill. It is ironic that the two political parties that pride themselves on being advocates for choice, will be voting against a proposal that would enhance choice and offer consumers even more choice in this very critical area of energy in the household.
Consumers are indeed paying for the new meters that are currently being rolled out, so consumers are stuck with paying for a technology from which they cannot benefit. That to me seems to be at odds with at least the professed beliefs of the two parties that are so far opposing this bill. We have heard much objection that the legislation has come too soon and that we must not get ahead of the game in terms of putting the technology in place before it is certain. In fact, that belies the reality. This is not new technology; it is well-proven technology. In fact, it is mandated in Victoria, the state of Australia, and in parts of the United States.
We are told that we must catch up with Australia. But suddenly the Government seems entirely reluctant to adopt the technology that is proving its worth in Australia, and that has been adopted there for all the reasons we are proposing that it would be appropriate to adopt it here. For a Government that speaks a great deal about innovation and the advancement of New Zealand’s economy, it seems to have a remarkable reluctance to innovate—not even to take a risk but simply to display some leadership—and to demonstrate a willingness to accept that time has moved on.
I must thank Mr Chauvel for his very appropriate comments that this is the iPod generation. We no longer content ourselves with just 78 records, but that is what this Government seems satisfied to do. There has been some mention of smart appliances. One spokesperson hoped that in his or her lifetime, smart appliances would be seen. I am not putting words in the mouth of Fisher and Paykel Appliances; I am not suggesting that that company is coming out in support of this bill, necessarily. But I spoke a few days ago to one of its technical people, who assured me that technically, in terms of electronic design and development, it could have smart appliances on the market within 18 months. All the company requires is confidence and the surety of the standard. Essentially, all it needs to light the fuse to make New Zealand - manufactured smart appliances available is an assurance of a standard. That is a very, very slight—minor—regulatory step, but that is what we see the Government unwilling to adopt tonight. Eighteen months is a very short time in the scheme of things, and that is how long it would take—not 10 years, not a lifetime.
Overall, the objections from the Government have been in effect quite niggling objections—that the bill is too soon and that the bill is imperfect. Of course it is imperfect; I doubt whether a member’s bill has ever come to this House that could not have been improved by appropriate attention from a select committee. It is very disappointing that this Government will not allow that process to proceed. What will come out of this debate, though, is that New Zealanders will note which parties were willing to stand up and support the best interests of consumers, and which parties were not there to support consumers’ interests. Kia ora koutou.
A party vote was called for on the question, That the Smart Meters (Consumer Choice) Bill be now read a first time.
Ayes 57
New Zealand Labour 43; Green Party 9; Māori Party 5.
Noes 64
New Zealand National 58; ACT New Zealand 5; United Future 1.
Motion not agreed to.
Bills
Tariff Act 1988 Repeal Bill
First Reading
Hon Sir ROGER DOUGLAS (ACT): I move, That the Tariff Act 1988 Repeal Bill be now read a first time. Way back in 1998, when National actually seemed to believe in something, it passed an Act that would have abolished all tariffs by 2006. The National Party back then had it right; the National Party today has lost its way, and now does not appear to believe in private enterprise or competition.
Tariffs can only harm the country that imposes them. When we impose tariffs on iPods, sports equipment, and shoes, we make New Zealand consumers worse off. Consumers have to pay for the goods that they want. To take just one example, let us assume that we have a family in South Auckland who want to buy a pair of shoes. If those shoes are heavily protected they might have to pay $200 for a pair, when they could pay only $100 for an imported pair. What happens when they pay the $200 instead of the $100? During that week they will be unable to go to the picture theatre, and they will possibly be unable to buy as much food as they would otherwise have, etc. In other words, although protection might have produced one or two jobs in the shoe industry, the country would have lost jobs elsewhere.
Let us take the recent idea that the Labour Party has desperately latched on to—that we should build trains here. Let us say that the cost is $200 million to import trains and $250 million to build them here. I ask members what the first effect is of buying from overseas. The first effect is that the Government is better off by $50 million. That is money that can be used to cut taxes or to spend elsewhere. “But what about the $200 million that goes to China?”, some will say, “instead of staying in New Zealand?”. Well, what can the Chinese do with New Zealand dollars? There are only three things. The first thing they can do is to purchase goods and services from New Zealand, in which case we have nothing to worry about. The second thing they can do is to make the money available for investment. Once again, if people want to invest in New Zealand we should be happy about that, as well. The third thing they can do is exchange New Zealand dollars for their local currency. If they do that, then someone else has those New Zealand dollars—dollars that must flow back to New Zealand in the end.
Labour members misunderstand the economics of trade. That is why they will not support this bill. Many in National understand the economics, but think that the politics are far too tough. National seems also to think that trade barriers are somehow a useful bargaining chip in international trade. According to the logic that National applies, the most powerful trade negotiator in the world must be North Korea, a country with the highest trade barriers in the world. According to the perverse logic employed by National—and by Labour, I might add—we must harm ourselves in order to convince other countries to sign a trade agreement with us. That is a truly stupid argument. According to that logic the Governments of Singapore and Hong Kong are fools, because no one will ever want to sign a free-trade agreement with them. So which dumb countries have bothered to sign free-trade agreements with countries like Singapore and Hong Kong, which have no tariffs? Interestingly enough, New Zealand has a free-trade agreement with both.
The fact is that New Zealand can gain—and this is the essence of the argument—by selling goods that it can produce at a relatively low cost, from agriculture, etc., and by using the proceeds to buy things that it can produce only at high cost, like trains and shoes. There are three reasons for that: firstly, in international trade the people of each nation will be able to use more of their resources to produce and sell things they do well—a major plus. Secondly, international trade allows both domestic producers and consumers to gain from reductions in per-unit costs, which are brought about by specialisation, size, etc. Thirdly, international trade promotes competition in domestic markets, and thereby allows consumers more choice and lower prices.
During the 1980s eight of the least developed countries in the world with the lowest restrictions—the lowest tariffs—grew their economies at 5 percent a year, while 10 of the least developed countries with the highest tariffs remained at zero percent for economic growth. I think that that is significant. If we take eight of the least developed countries in the world with low tariffs during the 1980s, we see that on average their economies grew by 5 percent. On the other hand, 10 of the countries that had the highest protection, the highest level of tariffs and other restrictions, collectively remained at zero percent for growth. I think that that makes the case for getting rid of tariffs.
Labour members, both last week and this week, have argued that if we provide protection to the rail industry by building trains here, then we will create jobs for New Zealand. That is wrong—wrong. If jobs were the key to high incomes, we could create as many as we liked. We could dig holes one day and fill them in the next, but we would be very poor as a result. Of course high tariffs will expand employment in a protected industry. That is obvious; anyone can see that. However, that does not mean that total employment in the country will expand. If job-savers think that high tariffs and other trade restraints will create jobs, why do they not introduce a tariff between the North Island and the South Island? For heaven’s sake, if it is such a good idea, why not do that? That example simply illustrates how absurd some of the arguments for having high tariffs really are.
To conclude, I want to make one final point: New Zealanders should simply be left to trade with whomever they want. We should be free to buy from the cheapest markets, and, if at all possible, to sell our goods in the most expensive. The economic benefits of trade do not—and I emphasise do not—care about political borders. Just as trade between Wellington and Auckland makes both cities better off—as indeed any voluntary trade must do—so does international trade make countries better off.
JOHN HAYES (National—Wairarapa): That speech made by Sir Roger Douglas sounded plausible, but I rise to oppose him, and I rise to oppose his piece of political theatre—one and a bit pages of four clauses that, if passed, would allow imports without the payment of tariffs, which are currently provided for by the Tariff Act 1988. In effect, this tiny piece of political theatre would get rid of the Tariff Act 1988. The Act provides a framework for the Tariff of New Zealand and its administration. The Tariff Act also provides for transitional safeguard measures where such measures have been provided for under free-trade agreements. Such safeguards protect New Zealand industries from serious injury caused by increased imports resulting from the reduction or elimination of tariffs under a free-trade agreement.
In many circumstances I would be inclined to support the proposal. Why? Lowering trade barriers is good for the ordinary person in my electorate and, more broadly, for this country. The Uruguay round of trade negotiations, which reduced trade barriers right across the world from 1994, is estimated to have increased world income by roughly US$100 billion. If tariffs on agricultural and industrial goods and services were reduced by one-third, there would be a further gain of about US$600 billion—or about 2 percent of world income. The removal of all trade barriers would deliver over 6 percent of world income. In fact, the gains would be much greater, I suspect, because these numbers are back-of-the-envelope calculations estimating the gains from bringing cheaper goods from world markets into what are currently protected markets. It is a very simple application of Ricardo’s theory of comparative advantage.
So why am I standing against this proposal from Sir Roger Douglas? Essentially, I say to Sir Roger that the question is about judgment; mine differs from his. New Zealand tariffs are already amongst the lowest in the world. New Zealand’s economy, along with economies like those of Hong Kong and Singapore, which Sir Roger mentioned, is one of the most open in the world. There are very few tariffs left to be knocked off, and those that remain are very low. The current 5 percent and 10 percent tariffs are subject to reductions that may arise out of the World Trade Organization’s Doha round, and also to reductions that may be negotiated with New Zealand’s free-trade agreement partners over the coming years. The most recent of these is the Malaysia free-trade agreement, which is before my select committee, the Foreign Affairs, Defence and Trade Committee.
In fact, if we look at New Zealand’s existing free-trade agreements, we see that there are very few tariffs left. They have been eliminated from exports from Australia, and our recently concluded free-trade agreements with China and 10 nations of South-east Asia—Hong Kong and others—mean that we are on a path towards the elimination of tariffs on goods from these countries also. In addition, through the World Trade Organization, we have offered duty-free access to the world’s poorest countries, the least developed countries. There are only a few sectors, such as clothing, textiles, footwear, and some manufacturing sectors, where tariffs remain. New Zealand’s last scheduled unilateral reduction of tariffs took place on 1 July last year, when the highest tariffs, mainly on footwear and carpets, were reduced to 10 percent. On 1 July 2008 tariffs on a range of mainly manufactured goods were reduced to 5 percent.
Let us talk about companies in my electorate, such as Metalform in Dannevirke where I will be on Friday helping to lock up a container with the 500th high-tech wheelchair to be exported. These companies are in absolutely no rush to see the remaining tariffs eliminated. They have competed with imports for years. Shoe manufacturers in my electorate, and certainly clothing manufacturers, have competed with imports for years and will continue to do so. These tariffs are likely to be negotiated away as our free-trade agreements take effect, but there is little to be gained from doing this immediately. This is why my judgment differs from Sir Roger’s. I remember what happened back in the late 1980s, when Sir Roger and his colleagues from the Labour Party caused massive economic restructuring, and what did that achieve? It increased unemployment, it ruined many small businesses, it ruined many farmers in my electorate, it penalised those on low incomes, and it penalised the elderly, who rebelled against discriminatory taxes. I say to Sir Roger that this is not what we need at this time on the back of a recession. It is a question of judgment, and that is why I stand against him.
The problem New Zealand faces is not that our consumers are hampered by high tariffs; that was certainly once the case, but it no longer is. It is that other countries have not followed suit—I am particularly thinking of America. We would see real economic gains if tariffs were reduced in our key export markets, and that is precisely what the Government is working hard to do through its agenda of free-trade agreement negotiations. We have done it with China, which is now our second-largest trading partner, and we are reaping the benefits. New Zealand exports to China grew by 43 percent last year. I say to Sir Roger that that was a key factor in driving New Zealand through the global recession and helping to keep New Zealanders in jobs. Increased market access in key export markets achieved through free-trade agreements can be expected to provide significant benefit to the New Zealand economy, to New Zealand companies, and to New Zealand consumers, and, in turn, support employment, which is so critical at this time of economic fragility.
Last year Cabinet decided to maintain tariffs through until 2015. That judgment was made on the basis that tariff reductions through trade negotiations, rather than through unilateral tariff reduction—as Sir Roger is proposing in the House tonight—will provide more benefit for domestic tariff liberalisation, and enhanced as well as reciprocal access to the markets of important trading partners. I say to Sir Roger that we have to be smart about this. That strategy makes sense for the economy as a whole. That is what Sir Roger Douglas overlooks; it is why his bill is faulty, and it is why I will vote against it tonight. Thank you.
Hon MARYAN STREET (Labour): I rise as the third speaker on the Tariff Act 1988 Repeal Bill. As the third speaker I have only 5 minutes, so I will not waste too much time traversing history. Suffice it to say that in the time of the fourth Labour Government, of which Sir Roger Douglas was a key member, there was huge economic restructuring and consequent dislocation, particularly of 300,000 people who lost their jobs in the process. Although we still stand by some of the economic restructuring, it was a period that saw the Labour Party nearly tear itself apart because of the extreme implications and effects of these policies. Sir Roger has now come back to finish the job. The Labour Party stands against this bill tonight and will stand against Sir Roger finishing this job.
The Tariff Act 1988 was legislated, to begin with, in order to provide for changing regulations around tariffs and the implementation of the Government’s plan to lower tariff rates to below 20 percent by 1992. Throughout the 1990s the National Government repeatedly and unilaterally lowered tariffs to the point where they were one-fifth of late 1980s levels. In 1998 the Government passed the Tariff (Zero Duty) Amendment Bill, which mandated the reduction of all tariffs to zero by 2006. But the new Labour Government in 2000 amended this bill, placing a freeze on all further unilateral tariff reductions until 2005, and tariff reductions were to continue as part of free-trade agreements. For Sir Roger to characterise our free-trade agreements as being only tariff reduction mechanisms is to do them a disservice. These days they are much more complex mechanisms than that, which is why the logic about countries that have no tariffs not entering into free-trade agreements with New Zealand does not stand up, because they continue to make gains from the other provisions in free-trade agreements that have nothing to do with tariff reductions.
I say to Sir Roger that that logic is out of date and needs to be updated. The new free-trade agreements well may contain tariff reductions, and frequently do. They are done on a calculated and measured basis in a way that allows some protection of New Zealand industry, and at the same time provides New Zealand with a few remaining bargaining chips. They are not the only things, but we have a few remaining bargaining chips that we may be able to deliver in the course of free-trade agreements. However, they are complex mechanisms these days, and they are not simply about tariff reductions. We have tariffs remaining on a number of goods. In particular, we have a 5 percent customs duty on textile imports and a range of other products imported from overseas. These products include processed foods, machinery, steel, and some plastic products. A 10 percent customs duty applies to a few imports, mainly clothing, footwear, and carpet. Those tariffs apply on goods that are still made in New Zealand.
I refer to a press release from the New Zealand Council of Trade Unions at the time when Tim Groser, the Minister of Trade, together with Simon Power, the Minister of Commerce, had announced that they not would be proceeding with any more unilateral tariff reductions. Peter Conway, the Secretary of the New Zealand Council of Trade Unions, said that although the level of tariffs provided much less security in respect of local industry and employment than in the past, it still made a difference to sectors such as carpets, clothing, textiles, and footwear, as well as to plastics and whiteware. He went on to say that the eventual phase-out of tariffs on items such as clothing, in the context of the free-trade agreement with China, and the likelihood that tariff reductions would feature in other such trade agreements, means that it does not make sense for New Zealand to undertake unilateral tariff reductions. I say to Sir Roger that the process of arriving at tariff reductions these days is a much more measured and calculated affair. They are now done in the context of complicated and very sophisticated free-trade agreements.
JACQUI DEAN (National—Waitaki): I rise to oppose the Tariff Act 1988 Repeal Bill with an air of confusion as to why this bill has come to Parliament. It seems to me that this is—
Hon Maryan Street: Finishing the job. It’s an old agenda.
Hon Steve Chadwick: Political theatre!
JACQUI DEAN: Indeed, I am in agreement with my Labour colleagues on this. This is an old agenda, and I believe it is an agenda that previous Governments and this Government have moved well away from. The Government is working successfully in terms of trade for both our importers and exporters.
When I looked at this brief bill, a couple of things struck me. The first thing that struck me was that in terms of trade this is an “all bets are off” type of bill. This bill is like New Zealand taking off its overcoat and exposing everything it has to offer to the world whilst still dealing, in trade terms, with fully clothed opponents. To me, that did not seem to be a very good thing to do. The bill seems to give away any trade advantage that New Zealand has, and we are an exporting nation. Exports are incredibly important to New Zealand and will continue to be important.
Another aspect of this bill that struck me was that previous trade Ministers, and our own Minister of Trade, the Hon Tim Groser, are working extremely hard to negotiate free-trade agreements. The word “negotiate” really captures where New Zealand is at in terms of trade these days, which is that we engage with countries like Hong Kong, China, and the ASEAN countries in negotiations that are not just about tariff rates but also about other aspects of trade with those countries and doing business with them. That might include things such as rights for workers, educational opportunities for both countries, and other such things. Tariffs may form a small part of those negotiations, but I would not have thought it was a very smart move for a small country in the middle of the South Pacific that is very dependent on trade and on forming trade relationships with other countries to just say: “OK, come in; it won’t cost you much. We’ll pay a tariff on goods going into your country.”.
This bill may work for importers, but certainly tariffs remain for exporters. As I have already said, we are a country that relies very heavily on exports. The repeal of the Tariff Act would put New Zealand at a huge disadvantage. We would open the door to tariff-free goods, yet our exporters would still face tariffs from our trading partners. The other problem is that we would lose the protection that we currently enjoy under the Tariff Act—that is, we would have no protection from a sudden influx of goods into our country. It has happened before; we are well aware of it. Chinese T-shirts or underpants come to mind. Without the protection of the Tariff Act, I fear that New Zealand would be exposed—possibly the wrong word—to that kind of influx of goods, with little protection.
I am curious about a term used in the bill, and in Sir Roger Douglas’ speech in reply I invite him to explain it, because I can make neither head nor tail of it. This is a short bill, luckily, and I refer to clause 4(2). He might explain the phrase “shipment includes loading into an aircraft; and to ship and cognate expressions have corresponding meanings”. I cannot understand what that term means. I am very interested to hear what Sir Roger Douglas makes of it, and I invite him to give us a very clear and full explanation of it. I strongly oppose this outdated, outmoded, and damaging bill. Thank you.
SU’A WILLIAM SIO (Labour—Māngere): This morning I was released by my whips to attend a community event where several Pacific community leaders who have been involved in a life-changing programme called “OTC”, or Off the Couch, were celebrating. This is a programme run by Buck and Lucretia Stowers of Genetics Gym in Manukau. Off the Couch involves some of the heaviest South Auckland men supporting one another to change their lifestyle through exercise and information.
I took a taxi from the South Auckland Taxi Association. While talking to the taxi driver, I learnt that he was quite concerned about the Auckland super-city and the impact of that change on him and his family. He was quite free with his views. He revealed to me that he did not like the person whom he called “the architect of the super-city”. He did not say any names but simply referred to that person as the “architect of the super-city”. He believed that his proposal would be “a disaster for Auckland”, and then he said: “He’s only firing the gun, but the bullets are coming from Roger himself.”
The “Roger” that this taxi driver referred to this morning is the same Hon Sir Roger Douglas whose bill, the Tariff Act 1988 Repeal Bill, we are debating. The taxi driver had a very vivid memory of losing his job during the Rogernomics period. He did not have a kind word to say at all about Sir Roger Douglas. I confess that I gave the taxi driver a bit of encouragement about that. Our community still has vivid memories of Sir Roger Douglas being responsible for Rogernomics in the 1980s. Tonight in this House in 2010 we are debating the first reading of a bill that is based on the same ideological thinking, which delivers only for the few and not for the many in our country. Sir Roger’s bill aims to remove all taxes on imports. The last time that Sir Roger played around with the removal of tariffs, he practically destroyed many of the industries of that time, particularly in my neighbourhood in Māngere in Manukau, South Auckland.
The wholesale overnight removal of all tariffs, as proposed by the Hon Sir Roger Douglas’ bill, is in our view reckless, and it would have a detrimental impact on many New Zealand industries and jobs, especially on our manufacturing industry. I will quote Peter Conway, Secretary of the Council of Trade Unions: “although the level of tariffs provide much less security in respect of local industry and employment than in the past, they still make a difference to sectors such as carpets, clothing, textile and footwear as well as plastics and whiteware.”
New Zealand’s unemployment rate has ballooned to over 7 percent under this Government, and it continues to rise. Māori and Pacific unemployment numbers have hit double digits, and the detrimental impact of being unemployed manifests itself in children going without and missing out on the basic necessities. Some families are falling behind in their power and rent payments. They are risking eviction and power cuts, because they have lost their jobs and cannot find other ones quickly enough. Some families are struggling to meet their mortgage payments, and risk losing their home, because they have been laid off from work. Since the last election, our unemployment rate has soared and it now stands at 30 percent higher than Australia’s rate, which has gone down. If this bill is passed, this Government will risk the livelihoods of many more families, who will lose their jobs as a result of the reckless ideology of the past.
Mr Douglas will argue that the tariff imposed on imported goods hurts consumers. He will argue that the tariff forces us to pay higher prices for goods. He will say the tariff should be removed so that consumers can have more money in their hand to spend elsewhere. If he is concerned about that, and if this Government is so concerned about additional costs being placed on consumers, they should back down on their proposed increases to GST, because increases to GST mean there will be higher prices in our community. No one voted for increases to GST. No one voted for higher prices for the basics.
We oppose Sir Roger Douglas’ bill. Labour supports free trade by endeavouring to build free-trade agreements, bilaterally and multilaterally through the World Trade Organization system, not through the reckless unilateral action that this bill proposes. New Zealand already has some of the lowest tariff rates in the world, which benefits our consumers.
DAVID CLENDON (Green): The point has been made that the Tariff Act 1988 Repeal Bill reflects a rather old agenda, and that must indeed be the case, because, when I was a much younger man—the honourable member in charge of the bill, the Hon Sir Roger Douglas, will be pleased to know this—I engaged in a protest against tariffs. That was at a time when New Zealand had a very diverse and robust manufacturing industry, unlike today. One of the products we manufactured was tyres, and at that time there was a very high tariff placed on the import of tyres, which was well and good, except that it included motorcycle tyres. Of course, we did not manufacture motorcycle tyres locally. So I took part in a protest, which took the form of many of us posting used tyres to our local member of Parliament. I rejoice in remembering the television images of the time, which showed a great pile of tyres arriving in this place.
More seriously, there are very valid reasons why one would continue to impose tariffs on imported goods. We all enjoy buying cheap products, and tariffs can indeed increase the price of imported products. If the cheapness of those imported products is because the manufacturers are more efficient and use the best technology and better design, then so be it. But most often, or very often, it is the case that cheap imported products are cheap because the people manufacturing them are not being paid what we would consider a reasonable wage, even in the context of their countries. They are not protected by unions and have no choice in the conditions of their employment. Very often products are cheap and arrive at our shores because the environmental measures taken during manufacture in the countries of origin would not be acceptable to us. Using resources carelessly, dumping waste into rivers and drains, and using child labour are all reasons why one would reasonably impose tariffs on goods coming into this country.
It is interesting that this bill comes to the House during Fair Trade Fortnight. A few days ago, a number of members from all parties across the House joined a small celebration of fair trade. The idea is that fair-trade products are guaranteed to come from countries, or at least from supply chains, where people are paid reasonably, and where there is some environmental management and control. One can purchase and consume those products with a clear conscience. In fact, there was a proposal that Parliament ought to become a fair-trade workplace.
The Greens have always had significant ambivalence about the notion of free trade, because it can simply be a disguise, or a mechanism for allowing us to import products that are not from sources that any of us would find acceptable if we took a moment to look at them, for the reasons that I have outlined. Tariffs are certainly a very legitimate mechanism, even in 2010. They are perhaps a mechanism to be used thoughtfully and lightly, but they have a place. We will certainly be opposing this bill.
TE URUROA FLAVELL (Māori Party—Waiariki): Tēnā nō tātou e te Whare. With an 18,000 kilometre coastline and a lack of land borders with other countries, Aotearoa is probably ideally suited to levying border tariffs on imported goods. In fact, tariffs have been a part of Government policies since right back in 1840. I am told that one of the first actions of Governor Hobson was to issue a customs regulation ordinance, which imposed a tariff on alcohol, tobacco, tea, sugar, and grains. These days, however, most goods remain free of tax. I am told that in 2008 about 80 percent of New Zealand’s imports were tariff-free. Some tariffs, of course, are of about 10 percent, and these apply mainly, as other speakers have said, to clothing, footwear, and carpet.
I understand Sir Roger’s kōrero that removing the payment of tariffs from importers would have some immediate benefits for consumers, with a likely reduction in the price of imported goods such as cellphones and computers. We know that the immediate income effects of lower consumer prices would inevitably benefit Māori, and to the extent that tariffs are a tax on exports, there is a school of thought that tariff reduction would benefit Māori relatively more than other groups. This is in light of the fact that, on average, the Māori economic base is twice as export-intensive as the New Zealand economy.
But there are a couple of major hitches, and I will outline those at this point. The Māori Party suggests that opening up the domestic market to a potential flood of imported goods could, and would, undermine locally manufactured goods. We say that this move might threaten our own local manufacturers at a time when we can least afford it, and in the wave of the very successful introduction of the tobacco tax by my co-leader Tariana Turia just last week, it would be devastating if removing tariffs suddenly opened the door to a mass of cheap alcohol and cigarettes.
I will raise a couple of other issues very quickly. The first is that this bill is inconsistent with the Māori Party’s position about the bigger picture of our international relationships. In our policy document, He Aha Te Mea Nui?, we made a commitment that “The economic benefits of international trade agreements need to be balanced with consideration of our own local, regional and national social progress and environmental enhancement.” That is the first point.
The second point is that as a political party, the Māori Party has opposed all free-trade agreement legislation to date. Our policy position is probably summed up best by saying that we want fair trade, not free trade. We seek a trading partnership that seeks greater equity in international trade, that offers better trading conditions, and that contributes to securing the rights of all workers. We say that more than profit is at stake. We want to see attention paid to labour and environmental justice issues, and to human rights issues.
Finally, I cannot leave this debate without stating the obvious: the Government has decided against any review of tariffs until 2015 at the earliest. Quite simply, nothing in the 105 words in this tiny little bill convinces us, as the Māori Party, to disregard our policy position, to turn against our voting history, to short-cut the Government’s deadline, or to support this bill. That will inevitably tell this House that the Māori Party will not be supporting the bill at its first reading. Kia ora tātou.
STUART NASH (Labour): I have heard the Māori Party member Te Ururoa Flavell talk about principles, and I hope he stands by his principles when the Government comes to introducing the Budget, which will increase GST on food to 15 percent. I hope he has the balls to stand by his principles and vote against the Budget.
We have heard from Labour members and National members, from every party in this House, as to why they will not support the Tariff Act 1988 Repeal Bill. I offer a personal message to Sir Roger Douglas. There are a few of us in this House whose ancestors have trod this path before. There is Todd McClay, whose father was Roger; there is Jonathan Young, whose father was Venn Young; and, although I am a little further removed, I have an ancestor who was here for 38 years. Then, there is Sir Roger Douglas, who was a Minister in the same Cabinet that his father was a Minister in. I remember Sir Roger Douglas as the man behind the concept of compulsory superannuation. I wonder what state our country would be in today if Sir Roger’s vision of compulsory superannuation had been realised and Robert Muldoon had not illegally cut the scheme off. I wonder what it would have looked like today. I think that Sir Roger’s vision of compulsory superannuation would have created an economy far greater in size and scope than the one we have today. So I take my hat off to him.
But I say to Sir Roger that at this point in time it is a game for a different generation. The prestige that he once had is now gone; it is a different game now. What happened to the principles he once stood for that allowed him to stand for Labour and work for the rights of workers? The ACT Party opposed my colleague Darien Fenton’s Employment Relations (Statutory Minimum Redundancy Entitlements) Amendment Bill. That bill represented the rights of the workers—the workers whom Sir Roger Douglas once stood for, stood proud for, and fought for.
The Tariff Act 1988 Repeal Bill would remove the tariffs that protect the industry still remaining in this country. It is the ideological thinking of a Sir Roger Douglas who is not connected to the Labour Party. In his younger days in the Kirk Government, he espoused everything that the Labour Party stood for. It is time for Sir Roger to retire. It is time for him to hang up his gloves, put his boots away, and remember the old times. I will remember him for introducing compulsory superannuation, because I think it was an awesome scheme. But this bill is not the bill that he wants to go out on. This bill will not protect New Zealand workers and New Zealand industry. It is not a bill put forward by a Labour Minister from a party that has 94 years of proud legacy. It is not a bill from a man who comes from three generations of Labour Party members of Parliament. It is time for Sir Roger Douglas and the outdated philosophy of the ACT Party to move forward. When it gets to a point where not only Labour but also National, the Greens, Jim Anderton, and Peter Dunne—everyone—oppose that philosophy, it is a sad conclusion to a great Labour Party family.
Labour supports free trade—of course we support free trade. New Zealand’s next Prime Minister, the Hon Phil Goff, signed the free-trade agreement with China. We are the champions of free trade; we believe in free trade. But this bill will not champion free trade. It will not move New Zealand forward; it will move New Zealand back. I am not too sure why Jacqui Dean is offering a rebuttal speech, because she stood up less than 5 minutes ago and supported the stance that I am now taking. This is not a bill for New Zealanders. All I can say to Sir Roger is that I am sad and ashamed that such a proud Labour family is bowing out on such a bill. I will not support it.
TODD McCLAY (National—Rotorua): What a disgraceful speech that was! That member, Stuart Nash, is as new to the House as I am. He stood up, and, first of all, pretended to heap praise upon a member of this Parliament who has been here for many years representing New Zealanders and constituents, worked hard, and come forward with something that he believes in and believes will help New Zealand. Then Mr Nash made an outright attack on that member of Parliament. I have decided to change my speech a little bit after that disgraceful intervention by the last member. Mr Nash lost all credibility at the end of his intervention when he said that the next Labour Party Prime Minister would be Phil Goff. At that stage everybody on this side of the House, and certainly everybody on that side of the House, switched off and stopped listening. I think there is a reasonable chance that the next Labour Party Prime Minister could be Stuart Nash himself. Would that not be a wonderful, wonderful country to live in?
I come directly to the Tariff Act 1988 Repeal Bill. Along with members opposite, I will not be supporting this bill, because I do not believe that it is the best thing we could be doing for the country in terms of trade at this moment. It is a little bit like a can of coconut cream. It looks good and it smells good, and we all want it, but when we dig down a bit deeper, we realise that it is not good for us. I will speak more about that in a moment.
The thing about trade negotiation is that it is like a game of chess. We do not give up all of our options or all of our advantages before we start playing the game. Unfortunately, this bill before us today would do exactly that. It would mean that when our negotiators went out to negotiate trade agreements on our behalf, we would have given up all of our advantages; all of the things we might trade away for better access for our exporters to other markets would have gone.
New Zealand tariffs are imposed against a very small number of imported products, and at extremely low levels. In 2008, 80 percent of goods imported into New Zealand were tariff-free, with no restriction. Those that did have tariffs imposed against them had tariffs rated at between 5 and 10 percent. As Jacqui Dean, a very capable member of Parliament from the South Island, said, the Tariff Act provides protection for New Zealand industries. A number of industries, perhaps, could not function as well if a large number of foreign goods were imported from other markets. The Minister of Commerce and the Government have the ability to provide some short-term protection through the imposition of tariffs to stop those goods from being imported. I think that is very, very important.
Last year, along with a number of my colleagues and members from the other side of this House, I had an opportunity to visit the Pacific Islands. It was very interesting to have discussions with people there. In fact, in a previous life before coming to this Parliament, I worked very closely with a number of Pacific Islands. I spent a good 4 years with them, negotiating trade access and trade agreements with the European Union. The one thing that the European Union wanted from the Pacific Island countries was increased access, because their tariff rates were very high. Conversely, on the other side, there was not a lot that the Pacific Island countries could offer the European Union—one of the largest trading blocs in the world—and, therefore the Pacific Island countries were very cautious not to give up too much of their protection too quickly. This bill would mean that New Zealand would be giving up too much at a time when we have the ability to negotiate more.
I will take the case of Niue, and come back to my analogy of coconut cream. In Niue people go out and pick coconuts. They make wonderful coconut milk and great coconut cream in factories over there. They get to export it to New Zealand without a tariff upon it, at all. Countries in Asia also produce coconut cream, and under the bill they would get access to our country without any tariff restriction, because there is no tariff restriction. Well, that would mean that coconut cream producers in countries like Niue, the Cook Islands, and the many other countries where great coconut cream is produced would be under greater pressure because of this bill. So I think we should not be doing it, at all. As the member opposite has just said, it tastes good, but it is not necessarily good for us. Certainly, this bill would not be good for those producers in the Pacific Islands.
I will finish up very, very briefly. If all of our trading partners were doing this tonight, as well, and if all of our trading partners around the world were saying “Let’s get rid of all tariffs.”, that would be fantastic for New Zealand. But, sadly, they are not. Sadly, it will take many years and a lot of hard work on the part of this Government to sign more free-trade agreements in order for us to have freer trade access. Therefore, we must go step by step to do that. I commend the honourable member Sir Roger Douglas for bringing the bill to the House, but National will not be supporting it. Thank you.
Hon Sir ROGER DOUGLAS (ACT): When I listened to the member from Māngere, I was reminded of a story that I think is very relevant. I recall a taxi trip I had from my home to the airport in 1990. I asked the taxi driver, a Samoan who lived in Ōtara, how business was. He looked at me and said: “Well, not all that fantastic, not that good.” I asked him why, thinking I would get a story about the deregulated taxi industry, leading to too many taxis, as the reason he was not doing well. But he said: “I am not doing all that well, but I am not complaining about it, because a lot of my customers now own their own cars. Because you’ve reduced the price so much, as a result of lowering tariffs, etc., my customers can now afford a car. So instead of having to get a taxi to take them home after they have been to the local grocery store, they can drive themselves home.” The fact is that because the Labour Government of the 1980s lowered tariffs in respect of cars and opened up that particular industry, a whole lot of people who could not own cars suddenly could do so. I think the Labour Party should think about that.
Mr Nash, I think, was trying to give me some sort of lecture. Given that Mr Nash gave me so much advice, I thought I might be able to give him a little bit of advice. I think he should start apologising to all those young Māori who are out of work—38 percent, after 9 years of a Labour Government. Thirty eight percent of young Māori are out of work. I think that Mr Nash should start to apologise to them. I think he should say sorry to every superannuitant in the country. When the State controls our entitlement to superannuation, as it does, then it will undoubtedly discriminate against those groups who have shorter lives. Our present system, which, of course, was amended and changed by the Labour Government over the last 9 years, discriminates against Māori and Pacific Islanders, in particular. So I think those Labour members should apologise for that.
I think Labour members should apologise for the populist vote-buying they entered into over 9 years, which left the country in debt, and left us with a deficit of 7 or 8 percent of GDP. I think they should apologise for the way in which they discriminated against low-income earners, and got them to pay for the children of the wealthy to go to university. I could go on. The last Labour Government tried to buy votes. It was a Government that spent over and above the rate of inflation by about $18 billion—in other words, for a family of four it imposed an extra $20,000 a year in costs. So if anyone needs to apologise, I think we should start with the Labour Party, and with Mr Nash in particular.
A party vote was called for on the question, That the Tariff Act 1988 Repeal Bill be now read a first time.
Ayes 5
ACT New Zealand 5.
Noes 116
New Zealand National 58; New Zealand Labour 43; Green Party 9; Māori Party 5; United Future 1.
Motion not agreed to.
Motions
Nuclear Disarmament—Treaty on the Non-Proliferation of Nuclear Weapons Review Conference
PHIL TWYFORD (Labour): I move, That this House recognise the historic opportunity to advance the cause of nuclear disarmament at the Treaty on the Non-Proliferation of Nuclear Weapons (NPT) Review Conference May 3-28; acknowledge the leadership on this issue by United States President Barack Obama; and call on the New Zealand Government to take an active role in this issue, drawing on our country’s proud nuclear-free stance, working together with other like-minded nations to support the United Nations Secretary-General’s Five Point Plan for Nuclear Disarmament including preparations for the development of a Nuclear Weapons Convention.
For more than two decades nuclear disarmament efforts have floundered, but a year ago in Prague a new US President declared America’s commitment to seek the peace and security of a world without nuclear weapons. Since then, the world has watched keenly, hoping that this generation will break the deadlock. In recent months we have seen the green shoots of an antinuclear spring. The US and Russia have negotiated a treaty to reduce their stockpiles. The US Government has conducted its Nuclear Posture Review. Some NATO States have called for the removal of nuclear weapons from Europe. President Obama hosted last month a summit in Washington to keep nuclear weapons out of the hands of terrorists. Now, Governments gather in New York to review the nuclear non-proliferation treaty. The world is watching with high hopes.
Twenty-three years ago we were ostracised by our traditional friends because of Labour’s antinuclear law. That reinforced in our nation a deep commitment to our nuclear-free policy as a symbol of our rejection of nuclear deterrence and our concern for the planet. That the Prime Minister was invited to Washington by the United States specifically because of our nuclear-free status speaks volumes about the fact that the world has caught up with New Zealand on this issue. But now is not the time to rest on our laurels. Now is the time to lead. We did it before, and we can do it again.
Others are looking to us. Former Australian Prime Minister Malcolm Fraser and former Australian Foreign Minister Gareth Evans both visited New Zealand in recent months, urging the Government to take a leadership role on this issue. US Vice-President Joe Biden said to the Prime Minister: “New Zealand could play a leadership role working with other countries demonstrating that the world free of nuclear weapons would be a better place.” But the Prime Minister did not even mention New Zealand’s nuclear-free status in the three-page document he presented to the Nuclear Security Summit. To the Prime Minister I say: “Don’t be an antinuclear lion in the New Zealand media, and a mouse in Washington or New York.” His comments on the nuclear issues seem to be only for a domestic audience, and, as some commentators have observed, he seemed to be using the access gained by our antinuclear credentials to leverage a free-trade agreement.
Well, I say to this National Government that trade is vital to our nation, but it is not everything. New Zealanders are passionately antinuclear. We want our nation to be a voice of conscience to argue the antinuclear case in the streets, at the World Court, and at international meetings. If we can make a difference and make this world safer for our grandchildren, we should. But it will take courage. We will have to stand up and be counted, and sometimes disagree with powerful friends. Norman Kirk did it, David Lange did it, Helen Clark did it, and history recognises them for it.
We can continue to work patiently at initiatives to build confidence in disarmament, getting weapons off their hair-trigger alert, and building support for nuclear-weapon-free zones. But the challenge now is to lift our eyes to the bigger goal. The United Nations Secretary-General, Ban Ki-moon, has proposed a five-point plan to get us there. New Zealand should explicitly commit to the plan and work with other like-minded nations to build support for it. The Government should call for preparatory talks on a process leading to the nuclear weapons convention. Many MPs in this House have already endorsed that call.
I want to finish with a quote from President Obama, from his Prague speech: “Human destiny will be what we make of it. … let us honor our past by reaching for a better future. Let us bridge our divisions, build upon our hopes, and accept our responsibility to leave this world more prosperous and more peaceful than we found it.”
Dr PAUL HUTCHISON (National—Hunua): As a foundation member of International Physicians for the Prevention of Nuclear War and a member of Parliamentarians for Nuclear Non-proliferation and Disarmament, it gives me great pleasure to speak on this motion. This National Government remains totally committed to the goal of a nuclear-weapon-free world. As we speak, the Minister for Disarmament and Arms Control, the Hon Georgina te Heuheu, and New Zealand officials are heavily engaged in the Nuclear Non-proliferation Treaty Review Conference being held in New York. As Minister Georgina te Heuheu said earlier today to the 189 non-proliferation treaty States parties assembled in New York, these are issues that New Zealanders feel passionately about. That passion has been borne out over many years and through the contribution of many members of this House and the broader community.
The nuclear non-proliferation treaty is often described as the cornerstone of the global nuclear disarmament and non-proliferation regime. It is the only multilateral treaty that contains a commitment to nuclear disarmament. New Zealand was one of the first countries to sign the non-proliferation treaty in 1968. The vision of a nuclear-weapon-free world has been adopted by all New Zealanders and is one that this Government proudly supports. As the Minister said in her statement at the UN this morning, the issues at the heart of the treaty are of a global nature. We are all impacted by the proliferation of nuclear weapons, and we would all suffer the catastrophic consequences of nuclear war.
President Obama’s leadership on nuclear issues has been largely responsible for reinvigorating the debate. When he spoke in Prague in April of this year, he expressed America’s commitment to seek the peace and security of a world without nuclear weapons. More recently, the US and Russia signed a new treaty on nuclear weapons reduction, and the US released its own Nuclear Posture Review, which marked a significant break from the past. Yesterday, the US Secretary of State, Hillary Clinton, announced that the US would be taking the important step of working to ratify the protocols to the South Pacific Nuclear Free Zone Treaty. The UN Secretary-General’s Five-Point Plan on Nuclear Disarmament is also lending momentum to global nuclear disarmament efforts, as the Minister acknowledged in her statement to the Nuclear Non-proliferation Treaty Review Conference today. The New Zealand Government welcomes these initiatives as concrete steps towards nuclear disarmament, but our delegation at the conference will be working for real disarmament commitments from all nuclear-weapon States.
Central to New Zealand’s nuclear disarmament engagement at the conference is our membership of the New Agenda Coalition, which will be pressing the review conference to adopt a number of practical recommendations that would significantly advance the world towards the elimination of nuclear weapons. New Zealand is also coordinating a group of States calling for action to address the significant number of nuclear weapons that still exist today on high alert, and to bring an end to a Cold War legacy. We will also be working closely with Australia on promoting greater transparency from nuclear-weapon States as an essential confidence-building measure, and supporting a Canadian initiative to address the non-proliferation treaty’s need for better working methods.
The motion put to the House today supports the development of a nuclear weapons convention that would outlaw the possession and use of nuclear weapons. This Government firmly believes that a legally binding instrument or framework of instruments governing the elimination of nuclear weapons will one day be required as we progress towards a world without those weapons. For that reason, New Zealand regularly supports a resolution at the UN General Assembly that calls for negotiation leading to a convention. As the Prime Minister stated in the House in April last year, our support for those negotiations is conditional upon the time being right. We need to deploy our resources where they will have the most effect. New Zealand’s approach has therefore been to support a nuclear weapons convention as a long-term goal, but in the meantime to focus on practical measures that will lessen the importance and number of nuclear weapons, and further diminish their threat. Our engagement at the Nuclear Non-proliferation Treaty Review Conference is focused on just those measures.
Dr KENNEDY GRAHAM (Green): I rise to support Mr Twyford’s motion, members’ motion No. 1. This House is asked to do three things: first, to recognise the historic opportunity to advance the cause of nuclear disarmament at the non-proliferation of nuclear weapons treaty conference that is currently under way; secondly, to recognise the leadership on this issue by US President Obama; and, thirdly, to call on the New Zealand Government to take an active role on this issue, drawing on our proud nuclear-free stance and supporting the UN’s five-point plan, including preparation for a nuclear weapons convention. Let us scrutinise each of those matters without any euphoria over the global opportunity for nuclear disarmament or New Zealand’s role in it.
The one historic opportunity for nuclear disarmament came and went in 1946, when the US, which was at the time the only country that possessed nuclear weapons, offered the Baruch Plan to place atomic energy under international control. Global strategic relations since that ill-fated attempt have taken the schizoid character of a determination by the five permanent Security Council members to accumulate nuclear weapons in their national arsenals, while preventing other States from doing the same. So we need to distinguish between nuclear disarmament and nuclear non-proliferation.
The non-proliferation treaty is an agreement to limit the spread of nuclear weapons to non - nuclear weapon States. It recognises the de facto possession of nuclear weapons by the five permanent members of the Security Council. That possession was justified for 40 years on the grounds of the need for there to be a mutual deterrent during the Cold War. When the Cold War ended, the rationale switched to retaining nuclear weapons as a prudential hedge in an uncertain world, and also as the currency of global power. Today it rests largely on the proclaimed need to deter nuclear terrorism. The strategic policy of NATO speaks, as always before, of the retention of nuclear weapons into the indefinite future at the lowest level necessary to preserve international peace and security—a haughty and patronising attitude, redolent of 19th century alliance diplomacy. The non-proliferation treaty includes, as the quid pro quo for the original agreement, an undertaking by the five permanent members to negotiate nuclear disarmament measures in good faith. The World Court judged back in 1996 that it was a binding obligation not just to negotiate but also to reach agreement on nuclear disarmament. That, of course, has not been done.
The positive rhetoric of the US President is a welcome change from the benighted and wilfully ignorant policy of his predecessor, but Mr Obama does not expect nuclear disarmament to occur in his lifetime. This relieves him of any responsibility to proceed with haste. Reducing the levels by 30 percent, to 1,550 nuclear strategic warheads each, will simply make the rubble bounce fewer times. It does not penetrate the barrier of minimal deterrence, nor will it do so until the legitimacy and effectiveness of global collective security through conventional weaponry is achieved, with nuclear weapons actually being dismantled. It would, in fact, be possible for the two major powers to dismantle their strategic arsenals in roughly the same amount of time that it took them to build them up: about 10 years. India recognised this in its proposals back in the 1980s, with its 20-year programme for a nuclear-free world. Failure by the five permanent members to make progress in this respect prompted India and Pakistan to emulate them. Israel, of course, is offered the special treatment of a duplicitous silence by superpower decree.
We in New Zealand have succumbed to a bout of narcissistic preening over our nuclear-free policy. I was, and remain, a supporter of that policy. I did my PhD on the subject, and I was part of the New Zealand delegation that negotiated the South Pacific zone. But there has always been a distinction between the strict nuclear-free policy that applies here in our national territory and the ambivalent stance that we take at the United Nations regarding a nuclear-free world. To this day, we still vote along political, rather than logical, lines on nuclear disarmament at the United Nations. Only when New Zealand declares its readiness to commence negotiations for a nuclear weapons convention that can be implemented over 20 years can this country stand true to its proclaimed nuclear-free policy. Until then, we remain encapsulated within the NATO reliance on nuclear weapons and remain pliant with our deployment of conventional armed forces overseas. Our SAS and provincial reconstruction team in Afghanistan operate effectively under NATO strategic direction, not that of the United Nations.
Let us wish the non-proliferation treaty conference well, let us wish President Obama well, and let us start to vote consistently for a nuclear-free world at the United Nations and take a leading role in working towards a nuclear weapons convention.
DAVID GARRETT (ACT): On behalf of the ACT Party, I rise to support this motion. We could hardly do otherwise. The Treaty on the Non-Proliferation of Nuclear Weapons is a bit like mum and apple pie: no one could possibly be against it.
Chris Hipkins: Motherhood and apple pie.
DAVID GARRETT: Motherhood—I thank the member. It has been around for many years. Even Phil Twyford, who moved the motion, was unable to tell me exactly since when, but we settled on it being many years prior to the Cold War. Certainly, times change. I recall being at university in the late 1980s, where I joined my fellow students, who were 10 years younger than me, in tittering sneeringly at the idea that “MAD”—mutually assured destruction—was indeed mad. But here we are, 20 years later, and I wonder whether the idea of mutually assured destruction did work, and whether the certainty of mutual annihilation prevented it from happening.
Although times have changed and the Cold War is over, one thing has not changed. I recall that 20 years ago nuclear terrorism had already been identified at that university as a threat for the future. University dons do not always get things right, but they were right about that one. Global thermonuclear war will probably never happen—thank God—but, sadly, nuclear terrorism probably will.
The non-proliferation treaty rationale was to keep the nuclear club no larger than it was when the treaty was first entered into. It failed. Israel, South Africa, North Korea, India, Pakistan, and probably Iran—not Iraq, we now know—got nuclear weapons anyway, so, in that sense, it was a failure. However, no one can disagree, as I said at the beginning, with strengthening the non-proliferation treaty and re-injecting life into it. That can only be a good thing. But, as I have said, times have changed.
The real threat that was predicted in the late 1980s has now come to pass. I may be mistaken, but there was a suggestion that the bomb that was to be let off in New York the other day was a dirty bomb. It was a so-called explosive bomb designed to fling about fissile material, not a nuclear device as such. That is the real threat. Sadly, it does not much matter even if Dr Graham’s fantasy comes true and all of the members and the non-members of the club disarm. There will still be a whole heap of fissile material floating around the world to fall into the hands of radical Islamic terrorists, or of any other terrorists for that matter. That is the real threat, and it does not matter how well the treaty machinery does its job. The real task is to eliminate fissile material from the world, and that will not be easy. It is a major problem.
Notwithstanding that, we should support nuclear disarmament—of course we should. The world can only be a better place without weapons of mass destruction. But we also need to face the fact that we have a major problem with nuclear terrorism that is linked, sadly, to religious radicalism, but not linked solely to it. I believe that the next challenge will not be disarming the superpowers, the members of the club, and the non-members of the club, but it will be accounting for and containing, if not destroying, fissile material that could well destroy us if it falls into the hands of people who are not only unafraid to die but also very keen to die. That is a whole new concern and a great worry, but we are certainly in favour of this motion. Thank you.
TE URUROA FLAVELL (Māori Party—Waiariki): Tēnā koe, Mr Assistant Speaker. Kia ora anō tātau katoa e hoa mā. Rua wiki kua hipa ake i tū au ki roto i te whare o te United Nations i roto i te āhuatanga o te whakahīhī mō te tū o Aotearoa i a ia e kōrero ana mō ngā iwi taketake o te ao. Mēnā ka tū koe ki roto i tērā whare kua mōhio tonu koe, arā noa atu te whānui, te whāroa o ngā kōrero kua kōrerohia e pā ana ki ngā take o te ao. Nō reira, ka mārama tonu i a koe e tū ana ki reira, ē, mō ēnei take pēnei i tēnei nā, he take nui, he take hōhonu e pā ana ki te whānuitanga o te ao. Nō reira, anei te Pāti Māori kua tae mai ki tēnei o ngā kaupapa, e tū whakahīhī nei mō te tū o Aotearoa ki te mau pūmau ki tēnei o ngā kaupapa, arā, kia wātea a Aotearoa ki ēnei momo take kia noho nuclear free tonu a Aotearoa. Me kī, kei te whakaae atu ki te āhuatanga i tēnei wā tonu nei, te wā e kōrerohia ana ngā take nei mō te nuclear disarmament i roto i tērā tiriti e kōrerohia ana ko te non-proliferation of nuclear weapons, i te hui, ki taku mōhio i roto o Amerika i ngā rā tata kua hipa, ā, tae rā nō ki te mutunga o tēnei mārama. Kai te tautoko ake i te āhuatanga o te kōrero a te mema Pāremata a Phil Twyford, nāna tēnei take i kōkiri ki roto i te Whare Pāremata, ka mihi rā ki a ia.
Nō ngā rua, toru wiki pea kua hipa ake, i tautoko ake te tiamana o te Centre for Arms Control and Non-Proliferation i te āhuatanga o te tū o Aotearoa mō tēnei take. Ka mutu, i tautoko ake te ngako o tēnei kaupapa. Lieutenant General Robert Gard mai i Amerika i Washington tonu i a ia e kōrero ana mō te Nuclear Security Summit. Ko tana kōrero he whakanui i a Aotearoa “hei toa” mō ngā take e kōrerohia nei. Ka mutu, mō te toa o Aotearoa ki te whakakore momo pū e kōrerohia ana, ka mutu, ki te whai i ngā tikanga here kia whakakore i ēnei momo pū kino nei, me kī. Ka mutu, me tū whakahīhī a Aotearoa nā runga i te āhuatanga o ngā kōrero o te Rt Hon David Lange, te wā i a ia Pirimia ana, toru tekau tau kua hipa ake. Nāna tēnei take i heri ki mua i te aroaro o te ao i tērā o ngā tau patupatu i Rānana i Ingarangi tonu.
I ngā tau 1980s, ko te Rōpū Reipa i tū tonu ki mua i te aroaro o te ao ki te whakatau, ki te kī atu ki te ao, ehara a Aotearoa i te wāhi tika mō ērā momo waka, kia haramai ki Aotearoa nei me aua momo pū, kua noho wātea tonu a Aotearoa i ērā momo pū. Ka mutu, ko tā Aotearoa he whakakore i tērā momo whāinga hei tiaki i tō tātau ake whenua. He kī atu, waiho ērā take ki wāhi kē, arā, te nuclear armament. No reira, nā runga i tērā whakaaro ake anei tātau e kōrero nei me te noho āhua rangirua tonu tēnei nā runga i te mea, rau tau kua hipa ake ko te Rōpū Reipa i whakahē i ētahi o ngā whakataunga i kōkirihia e te United Nations General Assembly ki te whakanui i te āhuatanga o te nuclear-free world. E toru ngā whakataunga i puta, ā, me pēnei rawa kōrerohia ki roto i te reo Pākehā, tuatahi, the major powers to reduce their nuclear arsenals, tuarua, stated that the use of nuclear weapons would constitute a violation of the charter, tuatoru, perceives nuclear weapons as posing “the most serious threat to the survival of mankind”. Nō reira, anei au e whakaaro ake ana, he aha te take e pēnei ana te āhuatanga o te Rōpū Reipa, e kōkiri nei i tēnei take engari nō ngā toru tau kua hipa, i whakahē nei i ngā whakataunga.
Hoi anō, he kōrero hītori tērā, he kōrero nō ngā tau kua hipa. Engari tōna mutunga mai, i tautoko a Aotearoa i te taha o ngā whenua o NATO, i te taha o Ahitereiria, he mema katoa i raro i te korowai o te global nuclear alliance o te Hononga o Amerika. Nō reira, anei tātau i tēnei pō e kōrero ana i te take nei me te whakaaro ake tērā pea, kua huri te Kāwangatanga hou nei ki te āta titiro ki ngā take kua kōkirihia kētia e ētahi, ka mutu, ka āta titiro ki te painga mō Aotearoa. Nō reira, kai te tino whakaae atu, ka mihi rā ki te tangata nei ki a Matua Twyford me tana whakahou anō rā i tōna ake rōpū mō ngā take kua kōrerohia, ka mutu, te tūmanako ia ka tū anō a Aotearoa “hei toa” mō tēnei take te nuclear disarmament.
Kei te tautoko te Pāti Māori i te whakataunga o te Tumuaki o te Kotahitanga o ngā Whenua o te Ao, a Ban Ki-moon, i a ia e kōkiri ana i tēnei take mō te United Nations Security Council summit mō ēnei take, kei te āhua ohorere tonu mō te nui o te pūtea ka whakapauhia i runga i ēnei momo pū. E ai ki ngā kōrero, hipa noa atu i te $1 trillion, kāore au i mōhio te ingoa Māori mō te “trillion”, engari, tērā kōrero tērā; trillion tāra e whakapauhia e Amerika ki runga i ēnei momo pū. He mea nui tērā, he aha te hē o te whakapau ki runga i te hunga pōhara. Ā, hoi anō kai te tautoko te Pāti Māori i te āhuatanga o Aotearoa, kia tau te rongomau, te rangimārie ki runga i te ao. Nō reira, me whai i tērā kia kore whakapau moni ki te hoko pū, ka mutu, ka tautoko ake i te tū o ngā five-point plan i kōkirihia e Ban Ki-moon, hei whakatau i ēnei momo take i te ao. Nā runga i tērā whakaaro, ka mihi ki te mema, ki te Whare tēnā koutou, kia ora tātau.
[Greetings to you, Mr Assistant Speaker, and to us all, fellow colleagues, once again. It has been 2 weeks since I stood proudly in the United Nations building as the Minister of Māori Affairs, the Hon Dr Pita Sharples, addressed the indigenous peoples of the world on New Zealand’s position. It is not until one stands in that building and experiences it for oneself that one realises just how broad and far-reaching statements impact on the world at large. So the Māori Party members come to this issue among the ones before us, proud of our stance to ensure that the Nuclear Free Policy remains in New Zealand. We agree to the circumstance at this moment right now; and during the discussions on issues relating to nuclear disarmament at the Treaty on the Non-Proliferation of Nuclear Weapons conference, to my knowledge America was involved in days just past, and right up to the end of this month. I support Phil Twyford, who proposed and brought this matter before the House, and acknowledge him.
In the past 2 or 3 weeks, the chair of the Center for Arms Control and Non-Proliferation reinforced our unique standing on this issue, supporting the nub of this policy. Lieutenant General Robert Gard, from Washington, in talking about the Nuclear Security Summit, said that New Zealand has been a “champion” in pressing nuclear weapons States to meet their obligations and disarm. Further to that, New Zealand can be proud of the stand taken some 30 years ago under the leadership of the late Rt Hon David Lange as Prime Minister, when he took this issue before the world in one of the debates in London in the very heart of England.
During the 1980s Labour stood up in the world by banning nuclear ships and declaring New Zealand nuclear-free. At the same time, New Zealand rejected the possibility of nuclear deterrence as part of a national security strategy, and stated quite firmly that nuclear armament should be taken to somewhere else. In that context, I am somewhat perplexed, because just 2 years ago Labour opposed some resolutions that the United Nations General Assembly put forward to promote a nuclear-free world. Three resolutions were as follows, and I will put them in English. The first one called for the major powers to reduce their nuclear arsenals; the second one stated that the use of nuclear weapons would constitute a violation of the charter; and the third perceived nuclear weapons as posing “the most serious threat to the survival of mankind”. So here I am wondering why Labour members should be putting this matter forward, when just 3 years ago they opposed the resolutions.
But never mind, that was just a historical account of the past. At the end of it all, New Zealand, with NATO countries and Australia, voted in favour of being members of the United States global nuclear alliance. So here we are tonight, talking about this matter, and confident at the same time that the new Government is prepared to review decisions and act in the best interests of New Zealand. We totally agree with that, and recognise Mr Twyford’s efforts in turning his party’s viewpoint round in respect of the issues that were discussed. The real hope is that New Zealand will once again be seen as a champion of nuclear disarmament.
The Māori Party supports the call from the United Nations Secretary-General Ban Ki-moon that set the context for the United Nations Security Council summit on these issues. But we are still amazed at the size of the funding spent on nuclear weapons. According to estimated costs, it far exceeds $1 trillion. I do not know what the Māori word for trillion is, but that is another issue; more than $1.3 trillion is being spent by the United States on nuclear arms. That is staggering. What is wrong with spending that amount on the poor? Nevertheless, the Māori Party supports peacekeeping functions in the world, and advocates that money should not be spent on arms. In addition, we support the five-point plan put forward by Ban Ki-moon to address this kind of global issue. On that thought, I acknowledge the member and the House by extending greetings to you and to us.]
Hon PETER DUNNE (Leader—United Future): I rise on behalf of United Future to support the resolution moved by Mr Twyford. I acknowledge his role in bringing this resolution before the House. I generally concur with the remarks made by the other speakers in this debate. I cut my political teeth on the campaign in 1971-72 to oppose French nuclear testing at Mururoa atoll. I vividly recall the image of Norman Kirk standing on the dock in Devonport in 1973 as HMNZS Otago, as it was at that stage, was farewelled to be the beacon of hope for New Zealand in the Mururoa test zone. I recall Norman Kirk saying we may only be a small country, but we could send a signal to the rest of the world. The fact that New Zealand and Australia combined shortly thereafter to take a case to the International Court of Justice, called the World Court in those days, and won that case regarding the illegality of the French efforts, gave some substance to what was a mounting campaign in this country at that time against the use of nuclear energy and on antinuclear issues not only in this country but on an international scale, as well.
In that same vein, I say one of the proudest moments, if not the proudest moment, that I have had as a member of Parliament was being in Los Angeles in 1985, when David Lange passed through on his way north to the Oxford Union debate. I was heading back to New Zealand as a young MP at that stage. I went to a dinner that was hosted on his behalf at the Ambassador Hotel in Los Angeles, in the very hotel—in the very room— that Robert Kennedy had been in shortly before his assassination a few years earlier. During the course of a very hostile dinner, which was attended by a largely American audience that was sceptical about the New Zealand Prime Minister and this country’s attitudes, Lange was getting a fairly rough time. At the end of the dinner—members have to imagine the back wall of the dining room was lined with television cameras—a rather large drooping-moustached, cigar-chomping, American reporter got up and said: “Prime Minister, you are on your way to Oxford to debate the morality of nuclear weapons with Jerry Falwell. He will have the Bible in one hand and a cross in the other, and be arguing in favour of nuclear weapons. What can you possibly say in response to him?”. Prime Minister Lange leapt to his feet and said: “I will tell him that to err is human, but that I am prepared to forgive him.” At that point, the approximately 400 people in the room leapt to their feet in a spontaneous standing ovation—including a group of senators that I had been at the same table with, who had spent the entire previous 2 hours deriding everything that Lange stood for and had said.
As a Kiwi, it was a moment of extraordinary pride to see our Prime Minister—let us forget party allegiances at that point—getting up there and essentially winning over an international audience. So it was to be in the Oxford Union debate held a little later—which to this day I have never actually seen, because I was in the air at the time. What those two events did for me, and I think for the country as a whole, was to give us some credibility in terms of nuclear non-proliferation issues. We were never going to be a nuclear power; that was never an issue as far as New Zealand was concerned. But I come back to what I think we can be, and what this resolution is all about: that moral beacon that Norman Kirk spoke of way back in 1973.
The challenge that now arises—and I pick up Dr Kennedy Graham’s point—is how we should give effect to what is a domestic sense of commitment, in an international environment. This resolution and the actions that would flow from it, if it is adopted, give some substance to the antinuclear cause, so I think that supporting the resolution is the appropriate thing to do. I think, also, that credit must be given to the New Zealand position as reflected by the Prime Minister in Washington just recently. This has been the result of an accumulation of effort over the years. It is important that we take advantage of the opportunities that are provided to us in the international forum and of the standing that we do have, and have acquired, to continue to push those issues, which have been very important to many New Zealanders over a long period of time.
I congratulate the mover of this motion. I am delighted to think it will pass with unanimous endorsement in this House, but I come back to Dr Graham’s point. These resolutions are all very well, but there is a wonderful quote from Bismarck that is appropriate in these circumstances. It is to the effect that the actions that flow from this resolution will be what is important, not the mere passage of the resolution itself.
Motion agreed to.
Sittings of the House
Sittings of the House
JO GOODHEW (Junior Whip—National): We have made excellent progress this afternoon and this evening; therefore, I seek the leave of the House for the House to now rise.
The ASSISTANT SPEAKER (Hon Rick Barker): Leave is sought for that purpose. Is there any objection? There is no objection. The House stands adjourned until 2 p.m. tomorrow. Nō reira, tēnā koutou, tēnā koutou. Pō mārie.
The House adjourned at 9.21 p.m.