Thursday, 12 May 2011

Thursday, 12 May 2011

Thursday, 12 May 2011

Mr Speaker took the Chair at 2 p.m.

Prayers.

Visitors

France—France - New Zealand Parliamentary Friendship Group

Mr SPEAKER: I have much pleasure in informing the House that a parliamentary delegation from the France - New Zealand Parliamentary Friendship Group of the Senate of the Republic of France, led by Senator Marcel Deneux, group president, is present in the gallery. I am sure members would wish that the delegation be welcomed.

Business Statement

Business Statement

Hon SIMON POWER (Acting Leader of the House): When the House resumes on Tuesday, 17 May the Government intends to progress the first readings of three Treaty bills as cognate bills. The Government also intends to move that the Aquaculture Legislation Amendment Bill (No 3) be read a second time. Wednesday is a members’ day and Thursday is Budget day.

Hon TREVOR MALLARD (Labour—Hutt South): Can I just have an assurance from the Acting Leader of the House that, as part of the Budget legislation, urgency will not be taken to take bills through past the point of a select committee hearing for legislation that does not come into effect until after the end of November.

Hon SIMON POWER (Acting Leader of the House): The shadow Leader of the House can be assured that all matters relating to any legislation that has a direct relationship with the Budget will be well canvassed at the Business Committee on Tuesday.

Tabling of Documents

Freshwater Management, National Policy Statement—Legal Advice

Hon Dr NICK SMITH (Minister for the Environment): During question time on Tuesday Russel Norman asked me a question in respect of the release of legal advice. I have checked and had clearance from the Attorney-General, so I seek leave of the House to table the extract from the Ministry for the Environment’s briefing dated 10 August 2010 on the legal advice in respect of the National Policy Statement for Freshwater Management.

Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is no objection.

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

Questions for Oral Answer

Questions to Ministers

Budget 2011—Effect on Families

1. Hon ANNETTE KING (Deputy Leader—Labour) to the Minister of Finance: In light of the Prime Minister’s announcement yesterday that money taken from some families getting Working for Families would be used to help low-income New Zealanders, will the changes to be made in his Budget next week make the Alexander family, who appeared on Campbell Live on Monday night, be better or worse off?

Hon BILL ENGLISH (Minister of Finance): The Prime Minister has said the scheme will be better targeted to low-income families and it will be a little less generous to families higher up the Working for Families scale. In relation to the Alexander family, I simply cannot comment on the family’s individual circumstances. What I can say is that the Government has a strong track record of protecting the most vulnerable families, and I would expect that family has benefited from increases in Working for Families payments and tax cuts.

Hon Annette King: Will a family with a baby and on one income, who received an $11-a-week tax cut from the Government’s tax switch, and who are receiving Working for Families, have more or less money from Working for Families if the changes foreshadowed yesterday are implemented?

Hon BILL ENGLISH: The House will just have to wait for the Budget to get the details of that. But the Prime Minister has stated that the scheme will be better targeted towards lower-income families.

Hon Annette King: Will the one-income family, with four children, paying mortgage, rates, insurance, power, gas, telephone, and car expenses, who have told Campbell Live that they have $50 a week left to feed and keep their family and that without Working for Families they would be lost, be better off after his Budget; if so, when?

Hon BILL ENGLISH: Again, the member will have to wait for the details. But as she will know, in respect of both types of families it depends crucially on their level of income, because those with higher incomes get lower Working for Families payments. I might say, with regard to the family who is paying off a mortgage, that they have the benefit of the lowest mortgage interest rates in 40 years.

Hon Annette King: If the commitment is to redirect Working for Families from higher-income New Zealanders to low-income New Zealanders, does he intend to release tables outlining exactly how much better or worse off people who currently receive Working for Families will be before the election, so they can decide whether the policy is fair; if not, why not?

Hon BILL ENGLISH: This Government will continue with the same way that it handles these kinds of policy issues, and that is being considered, responsible, moderate, and totally transparent.

Hon Annette King: I raise a point of order, Mr Speaker. My question was very specific: about whether the Minister would release tables outlining who will be better or worse off before the election.

Mr SPEAKER: I accept the member’s question was totally free of any political content or innuendo, but I think the Minister indicated that the Government will handle it in the way that it has previously handled it. It would be a bit precious for me to force him to say whether that would include a table. The member does have further supplementary questions in which to put more heat on that issue, if she wishes.

Hon Annette King: In light of the Prime Minister’s statement that low-income families have a much greater need for assistance, in what form will that assistance come—for example, greater access to budgeting services, so that they can make, as John Key said, better lifestyle choices?

Hon BILL ENGLISH: Assistance to low-income families comes in a number of forms. Working for Families is in the form of cash payments. In terms of access to education, of course, it is in the form of funding directly to schools and to salaries. Families are enjoying the benefit of having a Government that is very focused on lifting the achievement for their children in the health services. The assistance comes in the form of better, sooner, and more convenient health services. The Government has done a reasonable job of protecting our most vulnerable families through what has been a very difficult time for Government finances and for New Zealanders.

Hon Annette King: Why did he recently reduce the additional funding that was to be given to budget advisory services following the promise from the Minister for Social Development and Employment that they would be adequately funded, when she said they were doing invaluable work and she considered them to be local heroes, and when many of them now face a 70 percent increase in their client numbers in just the last year?

Hon BILL ENGLISH: The Government has provided what we believe to be adequate increases in social assistance and social services. There have been a number of changes for particular grants and particular services. We often find that when the increase is not as large as some people expect, the Opposition calls it a cut—and I think that basically sums up its economics.

John Boscawen: Is it correct that if New Zealand had not had the previous Government’s spend-up between 2004 and 2008, the Government would not have to borrow over $180 per week on the Alexanders’ behalf?

Hon BILL ENGLISH: The answer to that is yes, particularly because the social assistance programmes that the previous Government put in place had very considerable increases built into them, and this Government decided to continue to fund those programmes through the recession.

Budget 2011—KiwiSaver

2. PESETA SAM LOTU-IIGA (National—Maungakiekie) to the Minister of Finance: What changes is the Government making to improve KiwiSaver and make it more sustainable?

Hon BILL ENGLISH (Minister of Finance): As the Prime Minister confirmed yesterday, the Budget will include a package of measures aimed at ensuring that KiwiSaver is sustainable into the future, reducing the need for extra borrowing, and contributing to national savings. In addition to reducing the amount provided through the member tax credit, more will go into KiwiSaver from both individuals and employers, and the $1,000 kick-start payment for new members will remain as it is.

Peseta Sam Lotu-Iiga: What role will KiwiSaver play in the future?

Hon BILL ENGLISH: The first source of retirement income for all New Zealanders will remain New Zealand superannuation, which remains unchanged. KiwiSaver is an important supplement. It has 1.7 million members, and the number is growing by 20,000 a month. Projections show that with the changes the Government is intending to make, total KiwiSaver funds will grow to $25 billion by 2015, and almost $60 billion by 2021.

Peseta Sam Lotu-Iiga: How will these changes lift national savings?

Hon BILL ENGLISH: It is important to understand that national savings are not the same as retirement savings. National savings are the sum of private savings—in KiwiSaver but also, of course, in housing, in investment in business, and so on—and Government savings. So far, just over half of all KiwiSaver balances has been contributed by the Government, which is now in effect borrowing from abroad to make those contributions. As the Prime Minister has said, borrowing from one bank to deposit in another is not saving, and it is not what Kiwis do.

Hon David Cunliffe: Does he accept that the changes he is proposing to make to KiwiSaver will amount to an extra $10-a-week tax increase for 1.7 million KiwiSavers, or does he think they should take refuge in the New Zealand Superannuation Fund, which he has just refused to pre-fund for a decade?

Hon BILL ENGLISH: Well, Kiwis have the security of national superannuation for their retirement. In respect of the New Zealand Superannuation Fund and KiwiSaver, the Government has made decisions that reflect the circumstances we find ourselves in—that is, with a record $16 billion to $17 billion deficit, which has been the price of supporting this economy through the recession and facing the costs of rebuilding Christchurch. Taken as a whole, the changes to KiwiSaver and the reductions in the deficit will put the whole New Zealand economy on a stronger footing without affecting people’s retirement savings significantly.

Peseta Sam Lotu-Iiga: Will the intended changes to KiwiSaver endure over time?

Hon BILL ENGLISH: I believe that the intended savings will endure over time, partly because Labour has indicated through its leader that it will not reverse the changes that the Government will make. That is a pretty good vote of confidence in changes that Labour members have not yet heard all the details of. No sensible future Government will want to borrow to subsidise private savings.

Hon David Cunliffe: Referring to the Minister’s previous answer, how much of the $16 billion deficit he is forecasting for this year’s Budget is driven by the $23 billion of tax cuts he has handed out in the last two Budgets, and is he now prepared to agree that much of that tax cutting was misdirected, and that, overall, it was unaffordable for a country that has failed to grow as he projected?

Hon BILL ENGLISH: No. As we have pointed out to the member a number of times, and as he can verify through looking at the figures, the two tax packages implemented by the National-led Government have been fiscally neutral. In fact, Labour’s estimates show that those tax packages will have the net effect of increasing tax revenue over the next few years. So the Opposition’s assertion that tax cuts have cost the Government revenue is simply wrong. Those changes were designed to change the incentives in the economy, and they certainly will have a long-run positive impact on the New Zealand economy.

Budget 2011—Advice on Changes to KiwiSaver Tax Credit

3. Hon DAVID CUNLIFFE (Labour—New Lynn) to the Minister of Finance: Has he received advice on whether a reduction in the KiwiSaver member tax credit would raise or lower private savings; if so, what was that advice?

Hon BILL ENGLISH (Minister of Finance): Treasury forecasts to be published in the Budget will show that private savings, taking into account the impact of the KiwiSaver changes, will lift substantially over the next few years. Of course, that will not be difficult, given that the savings rate reached minus 10 percent of household income during Labour’s term in Government.

Hon David Cunliffe: Does he stand by his earlier statement that lifting private savings will be the centrepiece of his 2011 Budget; if so, how does he square that statement with indications that the benefits of private contributions to KiwiSaver will be reduced again, amounting to a $10 tax on 1.7 million KiwiSavers?

Hon BILL ENGLISH: The member needs to understand that KiwiSaver is only one vehicle for private savings. There are others—for instance, there has been quite strong growth in bank deposits, which are not subsidised by the Government. Other people reinvest in their businesses and see that as a form of savings. We believe that the combination of the tax changes made in the last Budget and the changes that will be announced next Thursday in this year’s Budget will push New Zealanders further in the direction in which they are already going, which is to significantly increase their savings. That is good for the economy.

Hon David Cunliffe: Given that he campaigned on not reducing the benefits of KiwiSaver, at all, and then hacked into it in two separate Budgets, why should 1.7 million KiwiSavers place any more weight on his integrity than they have on the Prime Minister’s promises to not raise GST and to catch up with Australia?

Hon BILL ENGLISH: The fact that 1.7 million people are in KiwiSaver tells us that they have confidence in the system. There is a little event coming up later in the year called an election. New Zealanders will have the opportunity to look at a prudent and responsible programme from this Government, or a mad borrowing spree from Labour, and they will make their own decision.

David Bennett: What reports has he seen in reaction to the Prime Minister’s announcements about KiwiSaver?

Hon BILL ENGLISH: There have been a number of generally supportive comments. Some business commentators have said that if these changes make the KiwiSaver scheme sustainable, then they are a step in the right direction. ANZ wealth management director John Body said the Government’s plans appear reasonable, and prospective changes to the member tax credits are sensible. Even the Opposition spokesman on finance seemed unconcerned, saying yesterday that the changes were “hardly the stuff of headlines”. We could apply that phrase to most of the things he has said, but he also applied it to KiwiSaver.

Hon David Cunliffe: Does the Minister agree with Business New Zealand’s Chief Executive Officer, Phil O’Reilly, that any move to increase employer contributions to KiwiSaver should be limited to a total rise of 1 percent to 3 percent, and does he intend to make any increase compulsory?

Hon BILL ENGLISH: The member will just have to wait for the Budget to see what increases the Government thinks are appropriate in the current economic circumstances.

Radio New Zealand—Funding

4. SUE KEDGLEY (Green) to the Minister of Broadcasting: When will Radio New Zealand’s funding freeze end?

Hon MAURICE WILLIAMSON (Minister for Building and Construction) on behalf of the Minister of Broadcasting: Radio New Zealand has been informed that it is unlikely to receive any increase in Crown funding over the next few years. Radio New Zealand has informed the Minister that it is able to operate effectively within current funding levels for at least the next 3 years. No changes in funding have been provided by the Government to Radio New Zealand. The baseline funding for 2010-11 was the same as for 2009-10 and is forecast to be the same for 2011-12. The Minister has advised Radio New Zealand that there will be no increase in its funding for the foreseeable future.

Sue Kedgley: Is it not the case, as Richard Griffin, chairman of the Radio New Zealand board, conceded in the Commerce Committee last week, that the present freeze in Radio New Zealand funding, which comes at a time when operating costs such as electricity and transmission are going up, is actually a cut in funding; if not, why not?

Hon MAURICE WILLIAMSON: No; because at the same time as the funding has been kept at the same level, Radio New Zealand has been able to find quite significant efficiency gains in the way it operates. The chair of Radio New Zealand in October 2010, Christine Grice, wrote to the Minister to say that clearly Radio New Zealand would be able to continue to function fully within its current funding for at least the next 3 years.

Sue Kedgley: Does he agree with the present chairman of the board of Radio New Zealand, Richard Griffin, that if the funding freeze continues beyond the next few years it will erode staff morale and create havoc in the organisation, and that Radio New Zealand will “wither on the vine”; if not, why not?

Hon MAURICE WILLIAMSON: One of the things I have found to be terribly unproductive around this place is to get involved in hypothetical debates about what might happen many years into the future. What will be done is on a case-by-case, year-by-year basis. The funding for Radio New Zealand will be assessed by the Minister of Broadcasting and Minister of Finance, and if, many years into the future, it is determined that Radio New Zealand requires an increase in funding, then that will be considered when it happens.

Sue Kedgley: Is he concerned that Richard Griffin told the Commerce Committee that the only strategy the board has to increase revenue for Radio New Zealand is selling two grand pianos, setting up a trust so that the board can go cap in hand to the public to try to raise funds, and running cake stalls?

Hon MAURICE WILLIAMSON: I would be very concerned if I thought the new chairman’s only way of raising funds was holding cake stalls. I believe that Richard Griffin has a very good view about broadcasting and has the ability to think quite innovatively about how other revenue streams and more cost-effective mechanisms can be brought to bear so that Radio New Zealand can continue to deliver the quality product it does within its current baseline.

Sue Kedgley: Does he agree with the majority of the board of Radio New Zealand that commercial sponsorship of Radio New Zealand should be a no-go area; if not, why not?

Hon MAURICE WILLIAMSON: I am told in my briefing notes that the current Radio New Zealand bill before the House does not allow sponsorship of Radio New Zealand, so the member can sleep calmly in her bed.

Sue Kedgley: Does he support the board’s proposal to set up a charity trust so that it can go begging to the public for financial support to maintain Radio New Zealand Concert, and down the track possibly Radio New Zealand National, as well; if so, why?

Hon MAURICE WILLIAMSON: The Minister of Broadcasting supports any move the board takes to increase revenue from other sources. I say good on it, and if it thinks there are ways it can get its loyal listeners to contribute in some way to help, I think that is a great thing for it to do.

Sue Kedgley: Is he disappointed that his hand-picked political appointee, Richard Griffin, is telling the truth about the effect of the funding freeze on Radio New Zealand, instead of just exercising his skills in public relations and spin?

Hon MAURICE WILLIAMSON: No, I can say I have never been disappointed in Richard Griffin.

Health Services—After-hours Medical Treatment

5. GRANT ROBERTSON (Labour—Wellington Central) to the Minister of Health: Does he stand by all his statements on after-hours medical treatment?

Hon PETER DUNNE (Associate Minister of Health) on behalf of the Minister of Health: Yes, he does stand by his many statements on after-hours medical treatment, including his concern about the cost of some after-hours services, despite the fact that the Government has put an extra $144 million into primary care over 4 years. There has always been a wide variation in after-hours fee charges—for example, the Ministry of Health reported several years ago that many adults around the country were paying over $86 for an after-hours visit. Indeed, there were instances of some people in the Queenstown area paying up to $200.

Grant Robertson: Does he still stand by his statement made in February that “in Auckland within the next 6 months we will have a network of 10 after-hours clinics providing lower-cost access to health services …”?

Hon PETER DUNNE: Work is under way to develop those clinics. It is proving to be a complicated task because it is a very involved task. But I can assure the member that it will be in place later this year.

Grant Robertson: Will the 10 clinics be operating from 1 July 2011?

Hon PETER DUNNE: I cannot give the member an absolutely precise operating date, but it will occur this year.

Grant Robertson: What guarantee can he give Aucklanders that there will be more affordable and accessible after-hours care, when the Waitematā District Health Board has expressed concern that the “total funding available will not cover a comprehensive range of services …”?

Hon PETER DUNNE: There are three things I could say in response to that. Firstly, there is $144 million more in primary care, $14 million of which will be going to after-hours care over the next 4 years. Secondly, the 10 clinics that the member referred to in his question will be in place later this year. Thirdly, the report from the Auditor-General’s investigation noted that all contractual responsibilities of district health boards were being met in this area.

Grant Robertson: Have any contracts been signed for after-hours clinics in Auckland from 1 July this year?

Hon PETER DUNNE: I answered earlier to the member that work on the development of these clinics is proceeding. The timetable has shifted a little bit, but they will still be operational this year.

Grant Robertson: I raise a point of order, Mr Speaker. I have taken your advice about asking extremely direct questions, and that was one. It was very simple—it asked whether any contracts have been signed for services from 1 July this year—and the Minister did not address that.

Mr SPEAKER: I think that was a very straight question. The Minister may not have the information, but I would invite him to answer it. It was a very direct question.

Hon PETER DUNNE: I think it was obvious from my earlier answer when I said that the facilities—

Hon Clayton Cosgrove: Come on, “Mr Perfect”—live up to your own standards.

Hon PETER DUNNE: Perhaps the member would let me answer the question. [Interruption]

Mr SPEAKER: The Minister is trying to assist the House.

Hon PETER DUNNE: What I said in response to earlier questions was that the clinics would be operational later this year. By definition, that means it will not be 1 July.

Grant Robertson: I seek leave to table the minutes of the Waitematā District Health Board community and public health advisory committee meeting on 9 March this year, where it expressed its concern that the total funding available will not cover a comprehensive range of services.

Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is no objection.

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

Earthquake, Christchurch—Availability of Skilled Labour

6. AARON GILMORE (National) to the Minister for Social Development and Employment: What assistance is the Government providing Christchurch to ensure the right skilled labour is available to help the city rebuild?

Hon PAULA BENNETT (Minister for Social Development and Employment): The Prime Minister is at this moment announcing a comprehensive skills package for Christchurch of $42 million to help the city rebuild. As part of this we are increasing workforce skills with up to 3,000 more construction-related training places in polytechs using existing funding. We are also providing an extra $42 million for 1,500 additional funded places at polytechs, private providers, and industry training organisations as required, and we are providing accelerated training programmes, as well.

Aaron Gilmore: What additional help is being provided from the Ministry of Social Development and Work and Income?

Hon PAULA BENNETT: This has been a real cross-agency focus, which has been really important. So to assist trainees into work the Ministry of Social Development is providing additional skills brokers at industry training organisations to work with employers to place those who are actually in training. The Ministry of Social Development will also receive an extra $5 million in Budget 2011 to purchase further industry partnership placements to help those unemployed young people and older people take up job opportunities from the rebuild. In addition, we are already spending $1.5 million helping those people in Christchurch into jobs as we speak.

Hon Clayton Cosgrove: Would the skills training assistance package be necessary if during the last 2½ years this Government had not cut industry training numbers by over 4,500 in the Canterbury region alone?

Hon PAULA BENNETT: What this Government has done over the last 2½ years is move some of that money into universities, where people wanted to be. The member knows that. There were people who wanted to study at university; there were others who were studying in other areas. We have put the money where the demand was and where it was truly needed.

Hon Clayton Cosgrove: I seek leave to table two documents showing the cut in industry trainees of over 4,500. They are the Tertiary Education Commission industry training quarterly performance indicators December 2008 and September 2010.

Mr SPEAKER: Leave is sought to table those documents. Is there any objection? There is no objection.

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

Rahui Katene: What role have Māori played in working to create employment opportunities in Christchurch, and what benefits will be directly available for young Māori seeking employment?

Hon PAULA BENNETT: There has been a lot of consultation, particularly with Ngāi Tahu, and certainly Mark Solomon has been quite involved in that work. I might add that the member herself has been pretty pushy in making sure that we acknowledge young Māori people and employment opportunities there. Te Puni Kōkiri will support at least 200 Māori in the Canterbury area to enter training and, subsequently, employment in the construction sector through the appointment of an agent to work with industry training organisations, education providers, and employers, and, of course, with Māori themselves.

Hon Clayton Cosgrove: Does this assistance to provide skilled labour extend to heating installers, given that as far back as last year the Government committed to having 4,500 emergency heating units installed in quake-damaged homes by winter, that as of this week MPs were advised that only 1,800 had been installed, and that, as a result of this, thousands of Cantabrians are going to be battling through the winter, living in cold, damp, and broken homes?

Hon PAULA BENNETT: Yes.

Early Childhood Education—Plans

7. SUE MORONEY (Labour) to the Minister of Education: What plans does she have for early childhood education?

Hon ANNE TOLLEY (Minister of Education): We have many, many exciting plans for early childhood services, including projects around the country to increase participation, plans to improve flexibility and reduce bureaucracy, and projects to ensure that children in Christchurch get back into early childhood education following the earthquake. We are doing all of this while being very responsible with taxpayer funds.

Sue Moroney: What has caused the delay in the release of the Taskforce on Early Childhood Education report she commissioned, which was initially due in March 2011, was then postponed until the second week of April, and has still not been released to date?

Hon ANNE TOLLEY: The task force is doing an extremely thorough job. As I told the member just recently, I expect it to report back soon.

Sue Moroney: Does she intend to publically release the work of the task force in the aftermath of next week’s Budget so that the task force’s response to the 330 submissions it received calling for 100 percent qualified staff, which she cut in February, gets buried in the bad news of the Budget?

Hon ANNE TOLLEY: As I just said in response to the question before last, the task force is doing an extremely thorough job, and it intends, as I understand, to report back soon. Of course we would want all its work to be available to the public.

Sue Moroney: When was she advised that the Taskforce on Early Childhood Education had completed its report and placed it on her desk?

Hon ANNE TOLLEY: I have not seen the final report from the task force. I have been advised that it is due soon.

Mr SPEAKER: I call question No. 8. [Interruption] Sorry—I just say to members that I have to be able to hear calls, please.

Rahui Katene: Does she agree with Diana Anderson, National Manager of Evaluation Services for the Education Review Office, that Māori children learn better when their education is put in a Māori context; if so, what initiatives is the ministry putting in place to ensure widespread adoption of such an approach?

Hon ANNE TOLLEY: Yes, I absolutely agree. There is plenty of evidence to show that that is absolutely correct. I would say particularly in respect of early childhood education that this Government has called a halt to the previous Government’s “build it and they will come” attitude for Māori youngsters, particularly in South Auckland. The Government is working with communities to make sure that we design services that suit their needs, that are culturally appropriate, and that deliver early childhood services in a way that each community in particular wants to see.

Sue Moroney: I seek leave to table a copy of the summary report on submissions to the Taskforce on Early Childhood Education, dated 18 February 2011, prepared by the task force secretariat.

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

Accident Compensation Corporation—Financial Performance

Dr JACKIE BLUE (National): My question is to the Minister for ACC: what progress has the Government made in improving ACC’s financial performance after the 57 percent increase in claims costs and the 109 percent increase in liabilities between 2004-05 and 2008-09? [Interruption]

Mr SPEAKER: Before I call the Minister, I say to both front benches that discourtesy to a colleague who is asking a question is unacceptable. Both Labour and National—it was not the minor parties—were equally at fault, and that will not continue. It is very discourteous. I invite Dr Jackie Blue to please repeat her question.

8. Dr JACKIE BLUE (National) to the Minister for ACC: What progress has the Government made in improving ACC’s financial performance after the 57 percent increase in claims costs and the 109 percent increase in liabilities between 2004-05 and 2008-09?

Hon Dr NICK SMITH (Minister for ACC): We have made very good progress. The large—

Hon Maryan Street: Did you just learn to calm down and take a breath?

Hon Dr NICK SMITH: Here is the guilty lady piping up again. The large increases in claim costs and liabilities resulted in ACC making losses of $2.4 billion in 2007-08 and $4.8 billion in 2008-09. But by better managing costs, and with a real focus on the importance of rehabilitation, ACC made a surplus of $2.5 billion in 2009-10, and I am expecting a significant surplus this year. This turn-round is good news for taxpayers and levy payers. We have been able to secure savings of $638 million for Budget 2011 over the next 4 years from lower costs in the non-earners account. I am also hopeful that if we get a good financial result for this year, we can look to see some reduction in levies for next year, which will be great news for households and businesses.

Dr Jackie Blue: What are the areas in which ACC has made the significant savings in costs, and how do these compare with the claims made by Opposition parties on how the turn-round has been achieved?

Hon Dr NICK SMITH: Claim costs in the last year are down by $350 million, or 15 percent, from the peak at the change of Government. The biggest share of this is the weekly compensation, which has reduced as a consequence of ACC’s significant improvement in rehabilitation rates. Claims that the savings have come mainly from elective surgery are incorrect, as those costs are down only slightly and make up only 2 percent of the improvement. Claims that the turn-round in ACC has been due to investment ignore the fact that only 10 percent of the record losses in 2008-09 came from investment losses. The primary reason for the turn-round is that ACC is getting people back to work earlier, and I think all New Zealanders should welcome that.

Find a Job Website Vacancies—Employment Standards

9. DARIEN FENTON (Labour) to the Minister for Social Development and Employment: Does the Work and Income NZ “Find a Job” website require all vacancies advertised to meet legal minimum employment standards; if not, why not?

Hon PAULA BENNETT (Minister for Social Development and Employment): Work and Income tell me that to be advertised, a vacancy must be a legal activity in accordance with the relevant employment legislation.

Darien Fenton: Does she think that Auckland builder Colin Lane’s job vacancy, which offered 6 weeks’ work with accident compensation levies, GST, tax, sick leave, and holidays excluded, meets legal minimum employment standards; if not, will she be advising Work and Income to review the job vacancies that it is advertising?

Hon PAULA BENNETT: My understanding is that the vacancy was for a contractor for 6 weeks. There are different rules, as the member knows, for those who are contracting and those who are on a weekly wage. Yes, I believe that it was within the legislation.

Darien Fenton: Is she aware that the Find a Job website is currently advertising jobs paying below minimum wage, piece-rate work, jobs being paid on a rate per square metre, and even a job for a traditional Chinese medical practitioner at minimum wage; if so, how does she think that this contributes to John Key’s commitment: “we want New Zealanders to have better jobs and better incomes,”?

Hon PAULA BENNETT: I suppose the difference between this side of the House and the other side is that this side thinks that any job is a good job. We do not always get to do our dream job. Sometimes we have to work hard, sometimes we have to get a bit stuck in, sometimes we have to prove ourselves to get promoted, and sometimes we have to wash dishes in a rest home for a while, or dig drains. But there are opportunities out there, and that is a great thing. Work and Income currently has 5,386 open positions, and over the last 12 months it has listed more than 65,000 positions on its website. I cannot guarantee that every single one of them is right, but I think it has got the criteria pretty strong, as much as they are.

Darien Fenton: Is the advertising by Work and Income of unlawful jobs that pay below minimum wage or seek to avoid labour laws part of the Government’s plan to promote the 30 percent differential in wages between New Zealand and Australia as a competitive advantage?

Hon PAULA BENNETT: As I have quite clearly said, we do not support unlawful jobs on the Work and Income website. Inappropriate businesses are also ruled out. The issue for the member is that Labour defines jobs for contractors as not being legitimate jobs. The member has certainly expressed that she does not like to see young people delivering papers and doing jobs like that. We actually support that sort of work and think that it is a good thing.

Hon Heather Roy: Which of these two options would she consider better for an unemployed 16-year-old on the Find a Job Website: first, a builder advertising an apprenticeship position for a young person, paying youth rates of $10 an hour—that is, $400 a week—or leaving that same young person on the unemployment benefit on $150 a week?

Hon PAULA BENNETT: We are always keen to see young people get into work, and we see building apprenticeships as an important part of that. So we would certainly support that.

John Boscawen: I raise a point of order, Mr Speaker. That was a very simple, direct question. The Minister was asked whether she would prefer option A or option B: a young apprentice builder earning $400 a week—

Mr SPEAKER: We do not need to have the question repeated. Does the Hon Simon Power wish to speak to the point of order?

Hon Simon Power: The member may have missed it, but towards the end of the Minister’s answer, which admittedly did drift off slightly, she said she supported that position.

Mr SPEAKER: A point of order is being heard, and there is an awful lot of noise, which there should not be. I have allowed members to contribute to this point of order, because the question was actually very straightforward. It did not contain any political innuendo. We traditionally do not ask Ministers always to give a yes or no answer or certain, precise answers to hypothetical situations. But on this occasion, because the question was very straightforward, I invite the Minister to give a more straightforward answer to the question. It does not mean it will satisfy the member asking it, but she should answer without deviation because the question was very simple. It asked whether the Minister would prefer someone to be in an apprenticeship on a youth rate—which is hypothetical, I accept—at $10 an hour or to be on the unemployment benefit at some lower rate.

Hon PAULA BENNETT: I recommend looking back at the Hansard, but I certainly said I would love to see young people in a building apprenticeship. That is exactly the answer I gave before.

John Boscawen: I raise a point of order, Mr Speaker. The Minister was asked whether she would prefer option A or option B. She did not answer the question. A building apprenticeship under the current law has to be at the minimum wage.

Mr SPEAKER: I do not blame the member for raising his point of order. Let me interpret the Minister’s answer, and if I am wrong, she had better get to her feet and correct it. She preferred the first option. If I am wrong, the Minister had better get to her feet and correct it.

Hon PAULA BENNETT: It was actually the second option. No, sorry—that was unemployment. Now I am confused.

Mr SPEAKER: I invite the Hon Heather Roy to repeat her question and we will start again. [Interruption] I want to hear this question clearly.

Hon Heather Roy: I think that might be helpful in the circumstances. Which of these two options would she consider better for an unemployed 16-year-old on the Find a Job website: a builder advertising an apprenticeship position for a young person, paying youth rates of $10 an hour—that is, $400 a week—or leaving that same young person to stay on the unemployment benefit on $150 a week?

Mr SPEAKER: I call the Hon Paula Bennett—[Interruption]—and I want to hear this answer in silence.

Hon PAULA BENNETT: Given a hypothetical choice between those two options, I would always rather see the young person in work. The building apprenticeship sounds quite good.

Retirement Commissioner—Transfer of Ministerial Responsibility

LOUISE UPSTON (National—Taupō): My question is to the Minister of Commerce and asks: why has the Government decided to transfer responsibility—[Interruption]

Mr SPEAKER: I apologise to the honourable member. It is definitely the Labour Party at fault here. It is unfair to members at the back. The interjections are totally unnecessary and unhelpful. I want to hear the question being asked.

10. LOUISE UPSTON (National—Taupō) to the Minister of Commerce: Why has the Government decided to transfer responsibility for the Retirement Commissioner from the social development and employment portfolio to the commerce portfolio?

Hon SIMON POWER (Minister of Commerce): The Government has decided that the functions and objectives of the Retirement Commissioner align better with the commerce portfolio, particularly as we focus on improving the financial literacy of mum and dad investors. The change will take effect from 1 July.

Louise Upston: How does this change align with the wider financial market reforms that this Government has implemented to date?

Hon SIMON POWER: Very well. The focus of the Government’s reforms to date has been to improve the quality and consistency of the information received by investors. We have already seen the new Financial Markets Authority act swiftly to ensure that the recipients of unsolicited low-ball offers receive more objective information about these offers. However, improving information can only ever be part of the financial literacy equation, and over the next few months I will be looking to work with both the public and private sectors to identify steps to improve investor knowledge and understanding of matters financial.

Foreign Affairs, Minister—Cost of RNZAF Flights

DAVID SHEARER (Labour—Mt Albert): To the Minister of Defence: what is the total cost of the two Defence Force flights that foreign Minister Hon Murray McCully took to Vanuatu on 13 February and returning on 14 February, including fuel, salaries of staff, allowances, accommodation, maintenance, landing fees, and all other costs associated with the flights?

Mr SPEAKER: I apologise to the honourable member. I accept the question was not read strictly as on the Order Paper but the meaning was very clear. But because of the excessive interjection, I invite the member to repeat his question.

11. DAVID SHEARER (Labour—Mt Albert) to the Minister of Defence: What is the total cost of the two Defence Force flights that took foreign affairs Minister Hon Murray McCully to Vanuatu on 13 February and returning on 14 February, including fuel, salaries of staff, allowances, accommodation, maintenance, landing fees, and all other costs associated with the flights?

Hon Dr WAYNE MAPP (Minister of Defence): The total cost for the two flights includes an aggregate—as is stated in the question, in fact—of direct costs such as fuel, and indirect costs such as staff costs. I have already told the House that the approximate fuel costs were a bit over $65,000. It is, however, not practical to break out all the indirect costs on a per flight basis, as many of those, such as salaries or, indeed, annualised maintenance, are incurred whether or not the aircraft fly. For instance, aircrew are clearly paid even on non-flying days. However, the indirect and direct costs are part of the total appropriation for the Boeing 757, which was $93.5 million. This includes all indirect costs, including salaries, a share of Whenuapai Air Base, and so forth. The total number of hours flown by the 757s is programmed at 1,450 hours. I should note that there were two flights on this particular occasion, involving firstly a 757 and secondly a P3 Orion. I did say to Mr McCully that I would guarantee that the 757 would fly without any maintenance problems. Unfortunately, that was not true. The 757 fleet incurred a breakdown that required the aircraft to return to New Zealand, and therefore a P3 was required.

David Shearer: Can he advise the House why the use of military flights was justified in part because the Samoan delegation could be collected on its way to Vanuatu, but they were left in Port Vila to make their own way home when the Orion was sent there to collect the Minister of Foreign Affairs, Mr McCully?

Hon Dr WAYNE MAPP: It is noted that the flight included the secretary-general of the forum itself and also the Samoan Minister who went up. I am not aware of further details.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. I think it has been well established who went there. I think the question is why they left them behind.

Mr SPEAKER: Sadly, though, the supplementary question asked included both bits, and the Minister answered the first bit. He confirmed that there were other people picked up on the way. He is not obliged to answer both parts.

David Shearer: Does he stand by his advice to the House last week that his colleague Murray McCully had to take military flights to and from Vanuatu because otherwise “that would have meant that the Minister of Foreign Affairs would have not been able to meet Prime Minister Julia Gillard.”; if so, how does he respond to the inconvenient truth that commercial flights through either Australia or New Caledonia were, in fact, available to get Mr McCully back in time to New Zealand?

Hon Dr WAYNE MAPP: I was advised that military flights were necessary to enable Mr McCully to meet all his obligations—

Hon Trevor Mallard: Who advised you that?

Hon Dr WAYNE MAPP: Mr McCully, in fact. [Interruption]

Mr SPEAKER: Is the member quite finished?

David Shearer: Does the Minister believe it is possible that Mr McCully had misled him over available commercial flights, or did he say they were all fully booked?

Hon Dr WAYNE MAPP: No.

Building Sector—Licensed Building Practitioner Scheme

12. CHRIS AUCHINVOLE (National—West Coast - Tasman) to the Minister for Building and Construction: What recent developments have been made to help tradespeople become licensed building practitioners?

Hon MAURICE WILLIAMSON (Minister for Building and Construction): As part of the licensed building practitioner scheme an online service has been launched by the Department of Building and Housing. The website will allow licensed building practitioners to register online, edit their profiles, and update their skills and expertise. Licensed building practitioners are an essential part of bringing a qualified professional workforce to the building and construction sector. Under the restricted work programme, which commences in March of next year, only a licensed building practitioner will be able to carry out and/or supervise the design and construction of restricted building work. Anybody else who does so will be acting illegally.

Chris Auchinvole: How does the website help the general public, especially Christchurch residents?

Hon MAURICE WILLIAMSON: This database will double as a tool for consumers to check whether practitioners are licensed and a means for them to obtain the latest information about them. The licensed building practitioner scheme will be important for the Christchurch rebuild. Of the 8,848 licences already issued, over 2,000 have been issued to licensed practitioners in the Christchurch area.

Phil Twyford: Has the Minister heard reports that many builders are reluctant to be licensed because of the expense and the paperwork; if so, has he considered automatically registering experienced builders in the licensing regime, to shift the burden of the paperwork from the builders on to his department?

Hon MAURICE WILLIAMSON: I heard those complaints at the very beginning of the system, but we have streamlined it dramatically since those complaints were heard. I am now told by a huge number of people from the industry, including master builders, certified builders, and others, that the online registration tools, the ability to update their profiles online, and the quite significantly reduced fee structure that we brought in place have been really good steps in the right direction.

Phil Twyford: What feedback has he received from builders around the country about reports that thousands of builders from Indonesia and the Philippines are heading to New Zealand since his Government slashed trade training, and will these overseas builders qualify under his licensing scheme?

Hon MAURICE WILLIAMSON: I have not heard anything about a flood of people from Indonesia of any sort, but, by the same token, if they are qualified builders, they apply to become licensed building practitioners, and they have the skills and the competence, we will welcome them because we will need those skills for both the Christchurch rebuild and a lot of work around the rest of the country.

Motions

Plumbers, Gasfitters and Drainlayers Board Notices 2010—Disallowances

CHARLES CHAUVEL (Labour): I move, That the House disallow clauses 3(1), 3(2), 8(1) and 8(2) in the Schedule to the Plumbers, Gasfitters and Drainlayers Board (Plumbing Registration and Licensing) Notice 2010; clauses 3(1), 3(2), 3(3), 3(4), 8(1), 8(2), 8(3) and 8(4) in the Schedule to the Plumbers, Gasfitters and Drainlayers Board (Gasfitting Registration and Licensing) Notice 2010; clauses 3(1), 3(2), 8(1) and 8(2) in the Schedule to the Plumbers, Gasfitters and Drainlayers Board (Drainlaying Registration and Licensing) Notice 2010; and clauses (6) and (7) in the Schedule to the Plumbers, Gasfitters and Drainlayers (Fees) Notice 2010, but that disallowance of clauses (6) and (7) in the Schedule to the Plumbers, Gasfitters and Drainlayers Board (Fees) Notice 2010 not take effect until 31 March 2012. In March last year the Plumbers, Gasfitters and Drainlayers Board issued the four notices named in the motion that I have just moved. In May and June last year complaints were made by members of the industry to the Regulations Review Committee about new training requirements put in place by the notices for plumbers and drainlayers. Similar requirements already apply to gasfitters. The requirements will have to be fulfilled before an annual practising licence will be able to be granted. A further separate complaint was made by a member of the industry last July about the way in which the board set its disciplinary levy—the way in which the board finances the hearing of complaints against members of the industry.

The Standing Order ground for the complaints about the continuing professional development requirements, and the complaint about the disciplinary levy, was that the board had made some unusual or unexpected use of powers conferred by the Act. An additional Standing Order ground was relied upon in the complaint concerning continuing professional development requirements, and that was that the consultation requirements set out in the Act were not followed.

The Regulations Review Committee agreed to hear the complaints, and did so in November last year. We heard from the complainants and from representatives of the board. In respect of the two complaints, we upheld them. We were not satisfied that the continuing professional development requirements had been dealt with under the relevant statutory provisions by the board in a proper fashion. Nor were we satisfied with the consultation undertaken by the board. We did not feel that it was sufficiently thorough or meaningful so as to ensure that the requirements were truly relevant to the industry.

In respect of the disciplinary levy, we were not satisfied that the board had a correct understanding of its statutory powers. According to the evidence we heard, costs for the collection of bad debts, a practitioner roadshow, a fees review, and a debt-collection project were all included in the calculation of the levy. The board also appeared to think—incorrectly—that it could use the levy to enforce action against non-registered persons.

For those reasons we unanimously decided to uphold the complaints, and in February this year we reported to the House and drew its attention to the four notices. In addition, we made a number of recommendations to the Government. A response to those recommendations is due next week, on 16 May, but it has been tabled today. In it the Government accepts the committee’s recommendations, and I thank the Minister for his thorough consideration of those recommendations and his acceptance of them.

In accordance with the committee’s usual practice, following our decision to uphold the complaints a member of the committee placed a disallowance motion on the Order Paper. On this occasion the disallowance motion appeared in the name of the deputy chairperson, Tim Macindoe, because of my absence on bereavement leave. Ordinarily, that would have completed the role of the committee.

The Standing Orders provide that disallowance motions moved by members of the Regulations Review Committee must be brought on for debate by the Government within 21 sitting days, or the regulations that are the subject of the motion lapse. That is the way in which the committee is given teeth by the Standing Orders. But on this occasion the committee made an error. We were well motivated in doing what we did, but it was an error, none the less.

After we reported to the House in February, and after the deputy chairperson moved a disallowance motion, the committee’s involvement should have stopped. If the Government had concerns about the disallowance motion it should have brought it on for debate and then moved amendments to it—as I apprehend that Mr Williamson may shortly do. Instead, the Government asked to meet the committee to express its concerns about the disallowance motion. We were told that it would put the financial viability of the board in jeopardy if it proceeded in its current form.

For that reason, we agreed to meet the officials to hear the detail of the Government’s concerns. We took the Government to be principally concerned with the disciplinary levy rather than the continuing professional development requirements, and, because we were concerned not to send the board insolvent, we took the unusual step of agreeing that it was desirable to defer the coming into effect of the disallowance motion.

So the deputy chair withdrew his motion, and I put one on the Order Paper—the one we are now debating. It is identical to the original motion except that it provides that disallowance in respect of the disciplinary levy should not take effect until next year. Regrettably, that did not satisfy the Government. We received further correspondence, and we heard from the Minister that his officials should also have asked for a deferral of the disallowance of the notices concerning continuing professional development.

When the Minister spoke to us on the subject—because, of course, we made ourselves available to him when he asked—he made further criticisms of the committee’s process. However, we did not feel able to defer to the Minister’s request for yet another disallowance motion, and instead we suggested that bringing the matter on for debate was the appropriate thing to do. I commend the Minister and the Government for agreeing to this course of action, and I confirm on behalf of the Opposition that if a reasonable amendment to the disallowance motion is moved by the Minister, it will be supported by members on this side of the House.

I thought it was important to rehearse the history of this matter, and I have now done so. I wish to make a few points in conclusion, because there is not time to do so fully. However, I want to say this about what my colleagues on the committee and I have learnt from this exercise, specifically in respect of this complaint, and generally in terms of our future procedure. First, the complaints had merit. The complainants were justified and right to bring them, and we were right, I think, as a committee, on the evidence, to have upheld them.

Having said that, I tell the House that the new board, including chairperson Hazel Armstrong, is doing an excellent job of trying to bring in new procedures and new requirements that we hope will see the industry being governed in the future on a much better and more sound footing.

On the subject matter of the complaints, I say that continuing professional development is a good thing in the industry, and it should be supported as long as it is properly consulted on in the future, and put in place in reliance on the correct statutory provisions. That did not happen in the past, but we hope that the board has learnt a lesson and will enable that to happen in the future. Similar comments apply in respect of the board’s disciplinary procedures. They were not made in correct reliance on the statutory procedures. We hope we have been very clear as to how, in future, the board can put in place a disciplinary levy that is properly assessed and properly calculated.

Those are the specific matters that I wanted to draw the House’s attention to in respect of the particular complaints we heard. I will conclude with a couple of general observations about the procedure of the Regulations Review Committee, as far as I intend to supervise it in the time that I have left as its chair. When we hear complaints that may have an effect beyond the narrow interests of the parties concerned, in future we are intending to advertise that fact rather than simply advise the parties themselves that we intend to hear the complaint and hear a response to it from the subject of that complaint. Obviously, that will allow other potentially affected persons or parties to take the opportunity to be heard by the committee, so that we can know the full effects in future of any disallowance motion we might be minded to move.

The final lesson I think we have learnt as far as procedure is concerned is that we will not enter into correspondence once we have decided on a disallowance motion, even for the best of reasons; even if it is to attempt to accommodate a legitimate concern on the part of the executive. Our decisions and any resulting motions will stand.

Motions, when they are made for disallowance, will simply have to be brought on for debate. At that point they can be the subject of amendment motions from any member of the House, including a Minister, so that if the Government has a concern about the way in which we have dealt with a matter, it can put an amendment forward, and the House can deal with the issue in a fully transparent way, as was intended originally by the Standing Orders.

I think that if we proceed otherwise, even when we are motivated by a desire to extend and maintain courtesy to the executive, we endanger the intended transparency with which the committee should function. I commend the disallowance motion to the House, and I thank the House for the time that has been allocated for this matter to be dealt with properly.

Hon MAURICE WILLIAMSON (Minister for Building and Construction): In response to the chair of the Regulations Review Committee I will make a few points about members’ motion No. 1. First of all, I start from the fact that the whole issue of the Plumbers, Gasfitters and Drainlayers Board has been quite shambolic for a long period of time. Members on the other side of the House will know that Dr Michael Cullen, while Minister for Tertiary Education, sacked the entire board at least twice because of the complete turmoil it was in. But the good news is that, under the chairmanship of Hazel Armstrong and the board of recent times, it is getting its act together. We recently were in receipt of a report from the Office of the Auditor-General on the operation of the board, and it gave it a reasonably good bill of health. It said there were still some things wrong that needed tidying, but a heap of stuff wrong from the past had been addressed. Basically, it was a report card that said the board was OK at present, poor in the past, and looking to get the future quite tidy. When I met with Hazel Armstrong this morning I conveyed my delight at the progress the board is making.

The two issues we are debating here today are to do with the use of disciplinary fees and how they were set, and, more important, whether a continuing professional development programme that the board had put in place through regulations could stay in place. I want to make it clear that I think both of those issues are being dealt with. I now have an output agreement with the Plumbers, Gasfitters and Drainlayers Board, and under that output agreement these issues will be dealt with. So I do not agree with the timing. The timing of the disciplinary fees matter would basically have meant the Plumbers, Gasfitters and Drainlayers Board was technically insolvent for a period of time, if it had stood. Fortunately, it was withdrawn, but then a split recommendation was resubmitted without our knowledge, and the second one would have made the continuing professional development programme not mandatory.

I say to the chair of the Regulations Review Committee that I think it is really important that—and I think at the end of his speech he covered it well—if a small group of people from whatever industry, from whatever sector, come to a select committee and say to that committee they are unhappy and think something is wrong, then that committee has an obligation to go out and ask whether there is any industry association or any large body out there that represents that industry, and to get them in to find out their view. I think the people who came before the committee were three plumbers, one of whom was not even registered. The Master Plumbers, Gasfitters and Drainlayers (NZ) Inc.—the Master Plumbers association, I call them—has 733 businesses as its members, which employ 3,800 tradespeople, and about 400 of those employees have joined the Master Plumbers, Gasfitters and Drainlayers simply because they want to be an employee member. That means it represents about 60 percent of the entire industry. I think it would have behoved the committee at the time to go out to a massive chunk of the represented industry and ask their view. If their view had aligned with the three people who had come before the committee, it would be all on. But it does not. The Master Plumbers, Gasfitters and Drainlayers do not support this disallowance motion.

I will tell members why. We have already clarified the disciplinary fees issue, which means we will be able to bring in a new regime next year, so I am pleased about that. But the second part is the disallowance of the mandatory nature of the continuing professional development programme. Many employers and industry suppliers out there have geared up their programmes and have invested in continuing professional development. I am sure both sides of the House think it is an essential part of the industry that people keep up their competence levels and their skills. Many tradespeople have also spent money on course fees and have taken time out of their businesses to participate in these courses. If this motion was allowed to stand, those people would have the ground cut right out from under them.

I thank the chairman of the Regulations Review Committee for raising the issues, although both the disciplinary fees issue and the continuing professional development issue are addressed under the new output agreement I have signed with Hazel Armstrong and the board, and we are dealing with them. I also thank him for his comments at the end of his speech that if anything like this comes up in future, the committee will go out and seek a much wider cohort of view. I know that members of the House will have experienced this all the time: a small number of people in any industry members can name—for example, a small number of boners at the meatworks—may have a particular view about the world, but is that view reflected in the view of the Meat Industry Association or the view of the meatworkers’ union? If it is, and if the vast bulk of members support it, then it clearly reflects the wider mood.

I say to the House that the Government will vote against this disallowance motion. We will vote against it not because it is not something that needs to happen—and it will happen—but because of the timing. Had the first motion, the Tim Macindoe motion, stayed, it would have caused serious trouble with regard to the board’s funding. It would have been technically insolvent. That was fixed by withdrawal of the first motion. The split motion would also send massive uncertainty out across the whole sector. The whole sector of plumbers, gasfitters, and drainlayers would now not know what it means to have a continuing professional development regime, which is basically an upskilling system for their members. It is important that they have that certainty. So the Government will vote against this disallowance motion, but I give assurance to those members of the committee who may be concerned that the new regime that comes in as of next year, as we bring the output agreement with the Plumbers, Gasfitters and Drainlayers Board to fruition, will address both the issues. In fact, the disciplinary levies stuff is already under control and being fixed.

I suggest to the House that we not take a lot more time about this matter. The Regulations Review Committee did what it thought was the right thing to do at the time. I have heard the chairman say that in future he will go out and consult more widely so as to get a representative view. If the motion had been a representative view of the entire industry—for example, if the Master Plumbers, Gasfitters and Drainlayers association had agreed with it—I would not be standing here today, because it really does not affect me either way. But I think it is quite clear that the industry does want the continuing professional development regime to stay in place. That will happen by the fact that the Government will vote against the disallowance motion.

CHRIS HIPKINS (Labour—Rimutaka): I am very happy to take a call on this disallowance motion in respect of the Plumbers, Gasfitters and Drainlayers Board. Before I get into my substantive remarks I want to respond to one or two of the things the Minister for Building and Construction raised and to put out a few points of clarification. The first point of clarification is that all of the decisions on this entire examination of these matters by the Regulations Review Committee have been made unanimously, with the support of Government and Opposition members on that committee. They have been entirely unanimous. The other point of clarification I want to raise is that the Plumbers, Gasfitters and Drainlayers Board was given an opportunity to reply. It was not like the committee was considering the submissions in isolation without providing the board with an opportunity to reply. The board was certainly given that opportunity.

The third point I raise is a disappointment that the Minister has informed us that the Government will vote against the motion, because the Minister had several options open to him. One of the options was to engage with this process earlier. He was informed of the committee’s consideration of the matter. He would have been briefed by his officials. He could have intervened at an earlier point and made submissions to the committee, but he chose not to do so. The second thing is if he was concerned about the timing of the motion coming to the House today, then he could have dealt with it with an amendment in his name that would have delayed the issue regarding the competence requirements, the professional development requirements, and he chose not to do that either. Instead, the Minister has chosen to throw out the recommendation of the Regulations Review Committee altogether. That is a very serious step for the Government to take.

The Regulations Review Committee is a very, very important part of Parliament’s processes. A lot of governing in this country is done by regulation without scrutiny by the House as a whole. We rely on a small committee to do that scrutiny function on behalf of the House. Therefore, when that committee, given the very narrow grounds it has under the Standing Orders to scrutinise regulatory decisions, makes a unanimous decision to the House to disallow regulations, I think that is something the House should take very seriously. I am very disappointed that even though the National members on the committee voted unanimously in favour of the disallowance motion, the Government will now use its power to block the disallowance motion. The reason the committee made the unanimous decision to disallow these regulations is that we did not think the law had been fully complied with. Those are the only grounds upon which the Regulations Review Committee can do that. The grounds upon which the committee can do that are set out in Standing Order 310(2)(a) to (i).

I acknowledge that a variety of concerns were raised by the people who first asked for the committee to consider the matter. A variety of issues have been raised by the Master Plumbers, Gasfitters and Drainlayers and by the board.

Hon Maurice Williamson: You didn’t even hear most of them.

CHRIS HIPKINS: They have corresponded.

Hon Maurice Williamson: You didn’t ask for them to come before you.

CHRIS HIPKINS: I certainly concede that. They had the opportunity to make a submission. They could have put a submission to the committee; they did not. They could have put a submission to the committee but they did not. They have corresponded and they have raised some legitimate concerns. Having said that, I think the step the Government is taking is the wrong one, and I think the Minister would have been better to move an amendment.

I will go back to the issue. Some legitimate concerns have been raised on both sides. The people who have raised concerns to the committee have raised them both within the committee’s delegated authority under the House and outside of the committee’s ability to investigate. For some of the concerns raised, the Regulations Review Committee simply does not have the power to investigate them. That does not mean the concerns are not valid. It simply means the committee does not have the power to investigate them. The board itself has acknowledged that things could have been better. As both the Minister and the chair of the Regulations Review Committee have said, the board is certainly doing very well at shaping up its act. The chairmanship of Hazel Armstrong has been commended from both sides. The board is getting its house in order. That is something we all acknowledge and welcome. Its history has not been flash, and it is good to see that it is getting on top of it and that it is dealing with those issues. The issue from the committee’s perspective is that we can intervene only in so far as the Standing Orders allow. Many of the concerns raised with regard to decisions that have been made fell outside of the competence of the committee to examine them.

I acknowledge the mixed views that exist within the industry itself. As a constituency member of Parliament I have been approached by people with very passionate views on both sides of the debate. It is not the role of the Regulations Review Committee to determine or pass judgment on the desirability or otherwise of decisions that are made under legislation. That is not within the committee’s ambit. The committee’s ambit is to ensure that the laws, delegated authority, and processes are complied with. The desirability or otherwise of decisions is a wider judgment. That judgment predominantly rests with the Minister concerned and the Government. If the Minister concerned or the Government is unhappy with the use of the delegated authority, then they have the ability to influence that. The Regulations Review Committee does not. As long as the law has been complied with and the appropriate process has been followed, then the Regulations Review Committee cannot intervene. It is important that the people who have made a complaint to the Regulations Review Committee and perhaps feel that we did not examine all of the aspects of the complaint are aware of that distinction. Our ability to investigate is quite narrowly constrained and confined. The committee looked at this matter very diligently within the constraints of our terms of reference and of what the Standing Orders allow.

The final point I want to raise is that the onus really now rests with the Government. It is ultimately responsible now for what happens with regard to the board, for supervising the performance of the board. I accept what the Minister has said regarding the performance agreement he has put in place with the board. I think that is a very good step. Again, I acknowledge that the board does seem to be improving what it is getting up to. I also say to the members of the industry who are dissatisfied or unhappy with this regime that they need to raise that with the Government, not with the Regulations Review Committee. I hope that the Minister will take on board any concerns members of the industry who are still concerned may want to raise with him. He is nodding, so I am getting an acknowledgment that he will do that. That is basically all I had to contribute on this particular debate.

A party vote was called for on the question, That the House disallow clauses 3(1), 3(2), 8(1) and 8(2) in the Schedule to the Plumbers, Gasfitters and Drainlayers Board (Plumbing Registration and Licensing) Notice 2010; clauses 3(1), 3(2), 3(3), 3(4), 8(1), 8(2), 8(3) and 8(4) in the Schedule to the Plumbers, Gasfitters and Drainlayers Board (Gasfitting Registration and Licensing) Notice 2010; clauses 3(1), 3(2), 8(1) and 8(2) in the Schedule to the Plumbers, Gasfitters and Drainlayers Board (Drainlaying Registration and Licensing) Notice 2010; and clauses (6) and (7) in the Schedule to the Plumbers, Gasfitters and Drainlayers (Fees) Notice 2010, but that disallowance of clauses (6) and (7) in the Schedule to the Plumbers, Gasfitters and Drainlayers Board (Fees) Notice 2010 not take effect until 31 March 2012.

Ayes 54

New Zealand Labour 42; Green Party 9; Progressive 1; Independents: Carter C, Harawira.

Noes 66

New Zealand National 58; ACT New Zealand 5; Māori Party 2; United Future 1.

Motion not agreed to.

Bills

Weathertight Homes Resolution Services (Financial Assistance Package) Amendment Bill

Second Reading

Hon MAURICE WILLIAMSON (Minister for Building and Construction): I move, That the Weathertight Homes Resolution Services (Financial Assistance Package) Amendment Bill be now read a second time. I acknowledge the hard work of the members of the Local Government and Environment Committee, whom I believe worked very well together in refining the bill and bringing some minor amendments back to the House that I think improve it. I would also like to thank all the submitters who took the time to offer their comments and opinions on the bill.

I am proud to commend this bill to the House because it enables an assistance package that helps address an issue that has been a huge burden on many owners of leaky homes over a very long time period. The social, economic, and health costs of leaky homes are affecting many New Zealanders and it is time to get those homes fixed. If one refers to the work done by PricewaterhouseCoopers, one sees that its view was that the bare minimum damage done to the residential properties of this country by leaky homes was $11.3 billion, so I make the House aware of the magnitude of this issue.

Owners of leaky homes have said to me: “There must be some way out of here.” I have never been to so many meetings in my whole political life where people were crying on a regular basis because they were stuck. They could not find a way of getting funding, and they could not fund the repairs themselves. Their house was rotting around their ears and there was, as I said, no way out. There is too much confusion in the current litigious process, because a number of people who have sought litigation have ended up winning their case, and then their legal fees have been almost the same size as—and in many cases, more than—their settlement. It is a case of even when one wins, one still loses.

The hour is getting late and, in my view, it is important that this financial assistance package gets to market as quickly as it can and that we get it up and running as soon as possible, so that those people out there who want to get their homes fixed get them fixed—not that we pay money to lawyers, or that we give grants to homeowners and then let them decide what they do, but that we actually pay this money towards getting their homes fixed.

Last year the Government announced the financial assistance package to provide another pathway to the repair of leaky homes. I want to make that quite clear, because there are some people out there who do not like this package. I fully appreciate that view, but it is a voluntary package. Nobody needs to sign up to it if they do not want to; this is just another pathway that homeowners can follow if they so wish. The package is voluntary. It is up to the homeowners to decide whether it is the best option for them in the circumstances.

Homeowners will remain entitled to pursue claims through the Department of Building and Housing dispute resolutions process and the Weathertight Homes Tribunal, through legal avenues, or a through a whole lot other things if they so wish. But if a qualifying homeowner chooses this financial assistance package, then the Government will pay 25 percent of the agreed repair costs, the participating council that approved the original construction work will pay 25 percent as well, and the remaining amount will be met by the homeowner. The contributions will be based on agreed, actual repair costs. It is a pretty good deal. I know that there are people out there who want it to be more. I know that the Local Government and Environment Committee will have heard people saying that it should have been more and that it should not have had the 10-year limitation. I know that a lot of superannuitants say that they cannot even afford the half, so the Government should pay the lot. But every time I looked at any of the alternatives to what we have come up with here, the sums of money involved made one’s eyes water. The Minister of Finance was quite clear that even this measure is a huge drag on the Government’s accounts, and that anything beyond this would have been going too far.

I am pleased that we, as a Government, have offered up a package. As I said before, it will be voluntary. The package also includes assistance to owners to access bank finance for the remaining agreed repair costs—that is, for the 50 percent left—by way of a loss-sharing arrangement with the banks, which have agreed to participate for loans made to owners who qualify for the assistance and who can meet bank lending criteria. That is good, and the details of that are currently being thrashed out between me and some of my officials, and the Bankers’ Association and the individual banks. The scheme also provides an opportunity for builders, designers, and others to contribute to the costs of repairing leaky homes and, therefore, to limit their liability. It can be a financial contribution or a contribution in kind.

I shall now outline what I think are the key changes contained in the amendment bill. The bill will limit the liability of participating territorial authorities and of any other contributing parties—for instance, other solvent defendants—for claims being addressed through the financial assistance package. It will protect the Crown from liability for the failure of repairs made under the financial assistance package, and any losses suffered as a result of the provisions of this package. It will provide a power for the appropriate Minister to prescribe and guarantee, or indemnify, in respect of a loan made for the purpose of repairs made under it, and it will make the financial assistance package available for a period of 5 years from the time the package first becomes operational.

These changes are necessary to facilitate the delivery of the package. So basically what we are saying is that if people choose to go with this the two things they will have to sign up to is that they will not sue the council, because it is putting in its 25 percent so it is a done deal, and they will not sue the Crown. The Crown does not have to do this. There have been a number of cases that have tried to join the Crown in litigation and they have been thrown out; they have failed. So the Crown could do what Labour did for 9 years and say that this is not our role and we are not getting involved. Well, the current Government thinks that we should get involved and that is what the package does.

The bill has been considered by the Local Government and Environment Committee and I am pleased about it. The Local Government and Environment Committee received 39 written submissions and heard nine oral submissions. I understand that submitters supported the bill in general, but for the last few minutes of my speech I want to go over the same point again. I do understand why some people think that the package does not go far enough, but every time I tried to expand the limits of this and make it maybe a 15-year period rather than 10 years—even though 10 years is the period in the Building Act—it made the amount of money involved just horrendous. As it is, it will be over $1 billion of liability on the Government’s books to do this over the period of time.

But I also want to notify people out there now of another important point. A number of people have said that by the time the financial assistance package comes to market, their house will be 10 years old and they will not be eligible. That is not true. If they get in and register their property with the Weathertight Homes Tribunal today, tomorrow, or whenever, the clock will stop ticking the moment they register. So even if they do not apply for the package until 11 years or 12 years into the life of the home, the clock will have stopped ticking before that time frame.

I am pleased to be able to offer this package. I think it gives homeowners a way forward. I regret the history of this, which dates back to decades of decision making, and the systemic failure of the building industry. I think it is a point worth making again. Some people say to me that the leaky home saga happened only because of non-treated timber. That is not true. Other people say that it happened because of a lack of skills in the industry. That is not true. Others say that it happened as a result of poor design. That is not true. People say that it happened because of poor inspections and so on. What happened—

Phil Twyford: Deregulation.

Hon MAURICE WILLIAMSON: Phil Twyford calls out “Deregulation.” I do—

Phil Twyford: All of them are the responsibility of the National Government.

Hon MAURICE WILLIAMSON: Now he has bit the bullet. He is saying that it was the deregulation of the building sector that did it. What Mr Twyford does not know is that deregulation occurred from a thing called the Building Act 1991. One would suspect that that was under National, right? It was a bill introduced into the House in 1990 by the Hon Margaret Austin, and it went through its whole process in this House—

Hon Trevor Mallard: Was she a Labour MP at the time?

Hon MAURICE WILLIAMSON: She was a Labour MP at the time.

Hon Trevor Mallard: Never!

Hon MAURICE WILLIAMSON: Yes, she was.

Hon Trevor Mallard: Never! Never really.

Hon MAURICE WILLIAMSON: Yes, she was. She was a Minister.

Hon Trevor Mallard: No, not deep down.

Hon MAURICE WILLIAMSON: Oh, all right. Trevor Mallard says that deep down she was not a Labour member.

Phil Twyford: Maurice, National passed it. It’s your responsibility.

Hon MAURICE WILLIAMSON: National passed its third reading, and now Mr Twyford is saying that it is National’s responsibility. Let us get it right. Labour introduced it, Labour took it through the select committee, Labour brought it back to Parliament, Labour took it through the Committee of the whole House, then National passed the third reading and now it is National’s fault. I love it! It is beautiful! That is one of my personal favourites. I will really use that one in future.

If Mr Twyford were a bit more gracious he would have gone with my original statement. It is a systemic failure across the board of industry, Government, regulations, and non-treated timber. I am pleased to have a package before the House today that will finally address that problem.

PHIL TWYFORD (Labour): In spite of the strenuous efforts of the Hon Maurice Williamson to shrug off the responsibility of the National Government in the 1990s for the deregulation that led to systemic failure, we on the Opposition benches support this bill because we acknowledge that the Government is attempting to tackle the problem of leaky homes. But in expressing support at the second reading, we feel it is necessary to be very clear about both the limits of this package and a number of concerns we have about unresolved issues relating to this bill.

We have three concerns. Firstly, many, many affected homeowners will be excluded from this package, and they will not benefit from the provisions of this bill. Secondly, there are many unresolved questions about the way the bill’s provisions will be implemented. Thirdly, the Government’s failure to address the industry’s chronic skills deficit and looming labour shortages threatens to derail the very intent and potential benefits of this initiative.

At the Local Government and Environment Committee we heard from many people who came to us saying they would not be able to benefit from the package, and I will comment on some of those. It is clear that many affected owners of leaky homes will make the judgment that they can get more through court action. It is probably true that it will be owners with claims of relatively low value, where the cost of the legal action is proportionately higher, who may be first in line to take advantage of this package. Many people who now live in or own homes that are not weathertight will not know that fact within the 5-year period, and the number of those people will also be significant. There will be even more people whose homes are more than 10 years old, and they will be excluded by the 10-year time frame. Perhaps even more worthy of consideration are the people who simply will not be able to afford the 50 percent that this bill will require them to stump up. They are the people who are most deserving of support, yet they are excluded from that support. They are the most vulnerable and the most disadvantaged by this problem, yet, because of the 50 percent rule, they will potentially be excluded.

Another group who will be excluded are the owners of dwellings in multi-dwelling complexes—apartment complexes, and so on. These dwellings amount to about 25 percent of the total number of dwellings affected by the weathertightness problem. About 5,500 dwellings are affected by the leaky homes problem, and their owners will not be able, in all likelihood, to get any benefit from this bill. There are a number of reasons for that. The first is that the banks simply will not lend money to bodies corporate, because they are unable to secure collectively owned property under a mortgage. Under the Unit Titles Act, a body corporate would be required to get 75 percent of owners committed to an action in order to receive financial assistance under this package.

Hon Maurice Williamson: It was 100.

PHIL TWYFORD: I know it was 100 percent. Many body corporate owners told us at the Local Government and Environment Committee hearings that they will simply be unable to get the agreement of 75 percent of owners. So right there we have 24 percent of the owners affected by this problem who will be effectively excluded from the benefits of this bill. I think that means that a relatively small number of people will be getting the benefits of this legislation.

We have a number of concerns about this bill, many of which we raised at the first reading, that have not been adequately answered or addressed during the select committee hearings. The first, and probably the most fundamental, is that this bill indemnifies the Crown, and effectively indemnifies the assessors from the Department of Building and Housing who will be the ones who go in to assess the cost of the repair job. The Department of Building and Housing officials themselves advised against this, and that is quoted in the regulatory impact statement. If the assessors make mistakes, the homeowners will have no come-back; they will have no redress against that. The Crown is indemnified. I did not hear any argument from officials during the select committee process that satisfied me there was a good reason why the Crown should not be required, like all other parties in this process, to stand by the quality of its work. That question remains unanswered.

There are a number of pitfalls that homeowners could face. It is not uncommon for a leaky repair job to get under way, and then for people to find out, a third of the way or halfway through the job when the cladding comes off, that the damage to the internals and to the structure of the house is actually much worse than previously thought. In that case—and we were reassured about this at the select committee—it will be possible for a kind of reassessment and a renegotiation of the agreed repair cost. That is fine, but what will that mean for homeowners who have already mortgaged themselves up to the eyeballs to meet the initial 50 percent cost? What happens then if they simply cannot take on any more debt? Will they be left to default on the contract? I think a lot more clarity is needed for situations when the repair jobs go pear-shaped.

Under this bill, as we have heard, Department of Building and Housing assessors are indemnified, but architects and builders are not. They are much more exposed than the Crown, and if things go wrong in the repair jobs, then it is the architects, designers, and builders who will get it in the neck. There are real concerns that because of the increased liability—the increased vulnerability—they face, it is quite possible that architects and designers, particularly in the kind of labour market we are going into, will not be lining up to do this remedial work.

The other thing we will also say at this point is that the bill does not differentiate between genuine homeowners who have been affected by the situation and people who are speculating. We raised that issue at the first reading, and I do not think there was a satisfactory answer from the Minister. It will be quite possible for property speculators to buy up affected properties at bargain-basement prices—thereby getting the full benefit of this financial assistance package at the expense of the taxpayer—and then to flick on those properties for a significant profit. It would have been quite simple to solve that problem in the drafting.

The third issue we have is less about the detail of this bill and more about the fact that this Government’s failure of leadership to address the entrenched problems in the building and construction industry could see a perfect storm developing in the coming months, which will completely overwhelm the intent of this bill to make a meaningful contribution to those homeowners affected by the weathertight homes problem. The building industry is in crisis, building consents are running at less than 50 percent of their peak, and we face a severely depleted workforce. Until today the Government had done nothing; in fact, it had done worse: it had slashed skills training in the industry, and we have been seeing large numbers of skilled tradespeople heading across the Tasman. Thousands of building apprentices have been laid off. We are looking at an acute shortage of skilled labour in the building and construction industry. There are some estimates that when the leaky home repairs and the Christchurch rebuilding get under way, we will have something like 25 percent of the skilled workforce that this country needs. If we have an acute labour shortage and a loosening of building regulations, as we are seeing with the amendments to the Building Act, this bill will be completely overwhelmed and will not achieve its objectives.

CHRIS AUCHINVOLE (National—West Coast - Tasman): I am very pleased to rise today to support the Weathertight Homes Resolution Services (Financial Assistance Package) Amendment Bill. First of all, I would like to acknowledge the Minister, Maurice Williamson, for his work on this bill.

Hon Christopher Finlayson: Outstanding.

CHRIS AUCHINVOLE: He is an outstanding man, as the Attorney-General says. We are becoming so used to this Minister coming to the House to give us good news from his various portfolios—good news. In question time it happened again today, and this bill is yet another example of the good work this Minister is doing, in spite of the criticism that gets levelled at him from the other side of the House. But wait—

Hon Trevor Mallard: No, no.

CHRIS AUCHINVOLE: —but yes. But wait, there will be more about that later on.

To adopt a serious tone for a moment because this is a very serious business, we are all relatively familiar with this dire situation that many thousands of families have found themselves in, when they discovered that their home is leaking and rotten. It has been salutary to listen to some of the submitters who came to the Local Government and Environment Committee. Often those submissions were not, unfortunately, within the scope of the bill but, none the less, the personal misery, the personal discomfort, was palpable. In most cases we are talking about someone’s largest asset into which they have invested their life-savings.

It has been over a decade now and this long-running problem has been waiting for the leadership that this Government has now provided. When I say “waiting for the leadership”, let us just see what this leadership has been in the past. In 2002 a headline—

Hon Christopher Finlayson: That would be Helen.

CHRIS AUCHINVOLE: Well, this was a headline in the New Zealand Herald: “Rotting buildings crisis is just a beat-up, says Clark”.

Hon Maurice Williamson: Who said that?

CHRIS AUCHINVOLE: The Prime Minister of the day.

Hon Maurice Williamson: When did she say that?

CHRIS AUCHINVOLE: In 2002. The article stated that she had “dismissed the leaky building crisis as a Herald ‘beat-up’ because only about 1,000 calls—rather than tens of thousands—have so far been logged …”. It also stated that she “told Newstalk ZB host Paul Holmes that she had not taken too much notice of the newspaper’s numerous stories, because the Herald was well known for ‘banging on’ about issues of no substance.” It stated that her comments had surprised people and they said that things had to change. Well, this Government has changed things with this bill. [Interruption] Indeed.

This is a very interesting bill to be part of, and may I express my appreciation of the way committee members from both sides of the House worked together, because everybody felt that we had to make this bill as good as it could be. It is less of a strong, legislative imperative than it is a sort of treaty between interested parties. It is not designed to give anyone a free ride or a cheap ride. It is designed to meet the requirements and to give certainty. That was repeated oft-times by submitters: people asking to be given certainty or to gain certainty. Local bodies wanted certainty over their responsibilities under this bill. The Government was giving certainty to people of its contribution. The banks have been involved in the discussion and they have started to show that they are willing to be involved in the same way. So it is more of an opportunity for involvement under the rules that this bill provides. My involvement has been as the chair of the select committee, and, as I say, I thank all members who have participated.

The Local Government and Environment Committee received 39 written submissions. We heard from nine of those submitters. Overall, the submissions gave general support to this financial assistance package. There are a number of changes that the committee has recommended, and I will run through those briefly. We recommended dividing the bill into Parts 1 and 2. The changes will clearly divide the bill between the amendments to the principal Act—the Weathertight Homes Resolution Services Act 2006—and the proposed amendments to the Public Finance Act 1989. We have also recommended that the commencement clauses include a set commencement date. Originally, the entire bill would have been brought into force by an Order in Council. Recommended changes would allow different provisions to be brought into force at different times by an Order in Council. Any provision that has not already come into force will then come into force on the first anniversary of the Royal assent.

This was considered a very advantageous way of going about it, by the parties concerned. But as a result of recommendations from the Regulations Review Committee, the commencement of legislation by an Order in Council should be used only in rare and exceptional circumstances. So we have recommended a change that remedies this situation, while still allowing flexibility around the commencements of various provisions. In addition, there are various changes to definitions used in the bill.

The financial assistance package will get leaky homes fixed faster. It will encourage people to take action with confidence. It will give huge relief to the people who have been involved. It is about spreading costs evenly. The package is voluntary. We expect that homeowners will be lining up to take this offer. The National Government has stepped up to the plate and got on with a way of finding a solution to this long-running problem. I am proud to be part of a Government, through the select committee process, that has brought this bill forward. I commend the bill to the House. Thank you.

BRENDON BURNS (Labour—Christchurch Central): I am very pleased to take a call as we go through the second reading of the Weathertight Homes Resolution Services (Financial Assistance Package) Amendment Bill.I will pick up on the comments of Chris Auchinvole, the chair of the Local Government and Environment Committee that considered this bill, and go back to Labour’s history on this issue.

I want us just to remember where the weathertightness issue emerged. It emerged in the early 1990s—

Hon Christopher Finlayson: Helen Clark said it was a beat-up.

BRENDON BURNS: —as Mr Finlayson would well know, when the then National Government deregulated the industry and took away the requirement that timber be treated in building sites. The National Government took that requirement away, and the Minister who is leading this bill was part of that very same Government. Let us not forget that. So although he comes to the House triumphantly with this bill to mop up a mess, the bill has it origins back in the Government of which he was a principal part in the 1990s.

Let us not forget another component of that cocktail of disaster, which was National saying that we did not need to have apprenticeships supported by the Government; the market would provide. That was another important component of that comedy of errors, which has led, according to the Minister’s estimate, to an $11 billion repair bill. The reason the Government is now stepping up to the plate in respect of $1 billion is that the Government of the 1990s, under National, walked away from training young builders to get the appropriate level of skills to deal with the other elements that came to fruition in the early 1990s, which were the new building products that were emerging and the new Mediterranean-style flush designs. That was the origin of the leaky building disaster, which is still with us today and which this bill is attempting to remedy. But let us not try to sheet the blame home to the last Labour Government. The origins of the leaky building problems rest very firmly with the Bolger administration of the 1990s and the push for deregulation, which have had enormous consequences for us. That is what we are trying to mop up with this bill.

Let us still say that Labour is supporting this bill, because this is as good as it gets, to this point. Therefore, we are duty-bound to support this bill. But that still leaves many unanswered questions of detail about the bill. I would like the Minister, at some point during the bill’s passage, to give the House an assurance about where the banks are on this issue. The bill requires that homeowners meet 50 percent of the cost of repairs, but they will not be able to do that unless the banks have come to the party. I would like the Minister to tell the House, before this bill is passed by it, whether any of the major trading banks have stepped up to the plate, have entered into his embrace, and have said that, yes, they are with him, and they want to commit to supporting those homeowners who want to repair their homes under this package of assistance.

Hon Maurice Williamson: Certain banks have already said that. And we will have them all on board by the time—

BRENDON BURNS: Well, if the Minister is able to give the House that assurance more formally through the course of this bill, it would be very useful. We need to know that this measure has the capacity to work. It has good detail, but in terms of the fine print we need to know whether there will be support from the major trading banks, because that is a key matter.

There are some fishhooks in this legislation, as I think the Minister will observe. This is in fact the second iteration of the package. A year or two back the Minister put forward a package in which the Government component was going to be only 10 percent. Quite rightly, local bodies squawked indignantly at the thought that they should be bearing the lion’s share of the cost, alongside homeowners. They came back to the Government, and we now see the Government stepping up to a 25 percent share.

The Minister attempted to say in his introductory remarks to the second reading that the Government cannot be legally bound to this process. But if we go back to the origins of this problem—to the deregulation that happened and the waning away of apprenticeships—we see that the Government of that time took steps that at least in moral terms, if not in legal terms, say to me and to members on this side of the House that the Government has some moral obligation to step up and try to sort out this disaster, which by the Minister’s estimate will cost $11 billion.

Hon Maurice Williamson: Why did Labour do nothing for 9 years?

BRENDON BURNS: No, I tell the Minister that we are not talking about doing nothing; we are talking about doing what is just and proper, and we are talking about sorting out a problem that began when that member was first a Minister in this House. He favoured taking the “heavy hand of the State” off the building industry, and we are seeing the consequences manifested through this bill today. So the Minister should stand up and take some responsibility for the mess he helped to create. Let us not just have the triumphant blowing of trumpets, because he was in part responsible for the disaster that we, as a Parliament, are trying to resolve today.

That is what this bill is about. It is a step forward, but it has many unanswered questions, and, quite naturally, people who have had a decade, or more, of distress will want to know whether this bill will sort out their particular problems. Yes, it will help some people; yes, it is a step up; yes, the Government is now contributing 25 percent of the cost; and, yes, the ratepayers of various councils will be paying 25 percent. But that still leaves people who were innocent parties—absolutely innocent—with costs to pay. Mums and dads who bought houses, investments, and properties in the 1990s, after the National Government had deregulated the building industry and had said: “You don’t need treated timber.”, still have costs to meet. Those are the facts that led to this disaster, yet mum and dad investors will still have to step up and meet those costs. We are hearing from the Minister—and I hope we will hear it more formally—that the banks will be stepping up and assisting those poor homeowners to pay the price. Fifty percent of the costs will still be sheeting back to homeowners, 25 percent to ratepayers, and 25 percent to taxpayers.

I ask the Minister another question: what assurance can he give the House about the competence of the Department of Building and Housing? That department will be providing the assessors who will make the judgments on whether houses are able to be repaired, and whether they will fit the criteria for this funding. I have to say that the Department of Building and Housing has a mixed bag of a record. I have worked for the Department of Building and Housing so I suppose I speak with some authority. It has done some things very well—tenancy services seem to be proceeding pretty well—but I have to note that in my city of Christchurch most recently—

Hon Tau Henare: What do you mean, your city?

BRENDON BURNS: I am the MP for Christchurch Central, unlike the member opposite, who will never be a constituency MP—

Hon David Cunliffe: I raise a point of order, Mr Speaker. I do not like to interrupt my learned colleague, but I understand there is a Standing Order against members moving seats for the purpose of interjecting. Mr Tau Henare has certainly moved his seat and is certainly incessantly interjecting. I think Mr Burns’ speech is worth listening to, but I cannot do so through that noise.

The ASSISTANT SPEAKER (Eric Roy): I am not sure that the member moved intentionally to get an advantage to interject. But I do have some discomfort at members who continue interjectory discussions—if interjectory is a word; I think members understand what I mean—apart from the member speaking. The member will desist.

BRENDON BURNS: Thank you, Mr Assistant Speaker. I was saying that I am very proudly the member of Parliament for Christchurch Central. I am a constituency MP, which is something that some members opposite will never be able to achieve.

We had the unfortunate situation, post the 22 February earthquake, when the Department of Building and Housing, without any reference, it seemed, to the community of Christchurch, spent a million dollars to hire 300 campervans and park them in the middle of the AMP showgrounds as a temporary housing measure to assist people who had lost their homes in the quake. Do members know how many people took up the offer of a campervan in the middle of the AMP showgrounds, at the cost of a million dollars to taxpayers? One—one! One campervan was taken up. So I would like some assurance.

Now the department is moving to establish temporary villages—again with no reference back to the communities in which those villages are being sited. So I would like the Minister to give us an assurance that the Department of Building and Housing has the competence to go out and do the assessments that will see ordinary mums and dads, ordinary battler Kiwis, still having to find 50 percent of the cost for remediation of homes, when they should not have had to bear that cost. We acknowledge that a quarter of the cost is being met by the Crown, and a quarter is being met by ratepayers, but that still leaves a huge cost.

We also have a question about local authorities. Obviously, they are still concerned about the issues of liability. They are concerned that they still face some liabilities for existing legal action, in which parties can still sue local authorities for a further contribution towards the repair bill. This issue is very topical for local authorities. The Minister needs to give some assurance that the ratepayers’ 25 percent contribution under this bill is the only cost that councillors, councils, and ratepayers are going to face.

SUE KEDGLEY (Green): The leaky homes saga is one of the worst man-made—I use the word “man” advisedly—disasters in the history of New Zealand. It affects, some are estimating, as many as 80,000 households and could cost anywhere between $11 billion and $23 billion to fix. It is such a fiasco that I thought I would go back to the Hansard record and discover how the fiasco came about.

I have to say that Maurice Williamson is correct. It was the Labour Government that developed the Building Act, which created this fiasco—and it was the National Government, under Mr Bolger, that took it over at the third reading. It was passed unanimously, with members of this House glowing with huge satisfaction about what wonderful legislation the 1991 Building Act was and what it was going to usher in.

Members all said they were going to deregulate the industry and wipe out all the previous regulations and controls in the industry, and they were going to do this because they were going to save money, reduce costs, and boost the building industry. So they loosened the councils’ inspection procedures to save money and to please the building industry. They tried to increase competition in the sector by allowing private sector building certifiers to compete with local council inspectors for work.

They lowered the standards, allowed the use of untreated timber and monolithic cladding, and then they allowed builders and developers to enter and exit the building industry with no liability, no skills, and no costs. Developers and builders could build a house, walk away without any liability, hide under the protection of a limited liability, simply disappear, or head off to Australia—as many thousands have done. They removed basic levels of skill and training—what did it matter, anyone could build a home, and all one needed to do was to ensure that the building complied with minimal standards in the building code. So it is interesting to look back and reflect on the debate, only 20 years ago, in this House.

It might be worthwhile during the Committee stage to read some of the speeches by Labour and National members about what a great idea it was to make all those changes. They crowed that by leaving it to the invisible hand of the market, and deregulating the industry, they would reduce building costs and usher in a wonderful new era. And here we are 20 years later, and, instead of saving money and reducing costs, we have an $11 billion—it could be $23 billion—bill.

We have, as the 2002 Hunn report stated: “a systematic breakdown across the entire building industry”. We have affected the lives of thousands, arguably hundreds of thousands, of New Zealanders, and we have ended up with somewhere between 24,000 and, possibly, even 80,000 newly built homes that are leaky, defective, and unliveable.

Families all over New Zealand are living in damp, mouldy, and unhealthy homes with Stachybotrys—more on that later. People are devastated and financially ruined all because National, supported by Labour, deregulated the building industry and left it to the market. So let us hope that the Government will learn from that fiasco. But no, it is running around trying to deregulate in a whole lot of other sectors and, no doubt, setting up similar fiascos.

Experts believe that as many as 89,000 homes built between 1992 and 2005 will leak. Some are saying that 80 percent or even 100 percent of houses, apartments, and multi-dwelling homes with monolithic cladding and untreated timber will fail irrespective of their design. John Gray, Home Owners and Buyers Association president, fears that every single house built from untreated timber will leak at some time in its life. He says that, contrary to official assurances, there are still houses that were built after the reforms of the building code in 2005 that leak like a sieve, despite the fact that builders are now using treated timber and are having to leave gaps between the walls and the timber frames.

Mr Gray said that there are still builders out there who are not builders, developers who do not give a damn, and owners who are trying to cut costs and build as cheaply as they can. So, actually, it is a saga of greed as well as of deregulation. The association warns that we have not even begun to estimate the true scope of the problem. Many people still do not realise they have a leaky home, or are in denial about it, or cannot afford to fix it, or their home has been fixed badly and will have to be repaired again. As many others have said, there are so many people who will not be able to pay 50 percent of the cost of repairing their home.

It was also pointed out that we are talking here in the legislation only about houses and multi-dwelling units. The weathertightness report pointed out that there are probably an equal number of motels, schools, retirement homes, and hospitals that are leaking like sieves. The fiasco that was created 20 years ago, with the unanimous support of Labour and National in this House, continues to ricochet through our nation.

Many people are concerned that they will not be eligible for financial assistance. They will miss out on this package because their houses were built in the 1990s, outside the time frames. The Government is saying that it is sorry about the 10-year limit, that it acknowledges people will be upset, but that the magnitude of the money required is so huge. But we believe it is quite simply unjust that a financial assistance package will not be available to people because of an arbitrary time frame. We believe the package should be open to anyone who has a leaky home, regardless of when it was built.

It is also galling, of course, to find that house owners whose houses were signed off by a private building certifier will not be eligible for the 25 percent council contribution. We had many heartbreaking submissions from people. I remember one submission from Rob Craigie. He said: “We’re in our late sixties. We’ve got a $160,000 mortgage on the damp house we own. We cannot sell it. We cannot possibly afford to pay 50 percent of a $300,000 bill”—which is what most of them are looking at—“on top of our mortgage, so we just have to stay here, working, and trying to keep paying our mortgage until we die.”

The problem with multi-unit legal claims has already been referred to, and many of these have stalled. Owners cannot afford to pay their fees. They cannot get enough of the body corporate to sign in. Then there is the whole business of the health effects, which no one has referred to. The mould and fungi from these damp, leaky homes produce tiny spores, and when they are inhaled they cause Stachybotrys. They produce toxins—mycotoxins—that cause adverse effects such as respiratory problems, eye and skin irritations, and flu-like syndromes, and they are particularly bad for people with asthma, bronchitis, and other breathing disorders.

From a health perspective we should be doing everything we can to fix these homes, because otherwise we will be paying for this situation yet again—through our health bill, for people who have incredible health problems as a result of living in these damp, leaky, unhealthy, and unsanitary homes.

I think our main message is that at least this bill is trying to say that the money should be spent not on legal fees but on fixing the homes. For that reason, and that reason alone, the Greens will support this bill, but we believe that anyone who has a leaky home should be eligible for this package. There should not be arbitrary time frames. We hope that the bill can be amended in that respect. Thank you very much.

RAHUI KATENE (Māori Party—Te Tai Tonga): I am very pleased to stand on behalf of the Māori Party to speak to the Weathertight Homes Resolution Services (Financial Assistance Package) Amendment Bill. There is little we could object to in this bill. The basic approach in establishing financial assistance measures for eligible owners of leaky buildings is one we endorse. It is about the basic right to adequate housing—not simply about a roof over one’s head, but also about the right to live somewhere in security, in peace, and in dignity. The proposed assistance measures are the result of negotiations between the Government, territorial authorities, and banks. Under the terms of the bill the Government and local authorities would each contribute 25 percent of agreed repair costs, with building owners paying the rest. Another approach within the bill is the push to improve owners’ access to finance to repair their buildings and divert litigation costs towards repair costs. Many of the members on the Local Government and Environment Committee were concerned that affected owners may not have the financial resources to opt into the scheme. The committee was told, for instance, that in the Greater Auckland area the Auckland Council estimates there are 3,301 properties with active claims. The council stated that it expects that a maximum of 12,000 new claims could be lodged.

The issue of costs is fundamental to effective implementation. Submitters told the committee that the leaky home scheme is too costly for many victims, and that owners are unable to raise the money to properly repair their homes. They were also concerned that rates may be bumped up to help fund the leaky homes bill. These are really deep-seated fears that must guide all parties in looking at the effectiveness of this bill. But it is good to see that the Government appears to be up to the challenge, and when we think about it, the challenge of a formidable budget blowout if the Government does not intervene is probably as good a reason as any to support this bill as a viable alternative. The scale of the problem is of course the biggest issue. More than 80,000 people are living in leaky homes, which were mostly built between 1992 and 2005 under relaxed building codes. The cost is approximately $11 billion to $50 billion. The Government’s 25 percent contribution towards agreed repair costs is expected to cost about $1 billion over 5 years. So for us, the most important thing is being able to alleviate both the financial and health implications caused by leaky homes.

The Māori Party supports a commitment to manaaki and awhi people affected by leaky homes, as it supported the Weathertight Homes Resolution Services Bill passed into law in 2006 and related legislation since. By implication, we also support the Government’s proposal to act as a guarantor to financial institutions, so that the pressure of lending for the purposes of repairing leaky homes by these institutions can be eased and therefore money to fix leaky homes is more readily accessible. I want to also place on record our support for initiatives such as innovation in housing for Māori, including the Housing Innovation Fund, and social and affordable housing, and the Heat Smart home insulation programme to warm up Aotearoa. In many ways this leaky homes initiative is merely another platform within this wider context of Whānau Ora. The Māori Party is also clear about our support for a form of a credit support facility. Under this bill the Crown will act as a guarantor to financial institutions such as banks, so that the pressure of lending for the purposes of repairing leaky homes by those institutions can be eased, and money to fix homes is more readily accessible, as I said earlier. At its simplest form, therefore, the bill aims to provide owners of leaky homes access to cost-effective procedures for the assessment and resolution of claims.

Finally, the Māori Party supports a revised building code for builders and local councils. We do all this in pursuit of two very worthy goals articulated in the Declaration on the Rights of Indigenous Peoples. Article 21 specifies that “Indigenous peoples have the right, without discrimination, to the improvement of their economic and social conditions, including, … in the areas of … housing,”. Article 23 notes that “Indigenous peoples have the right to determine and develop priorities and strategies for exercising their right to development. In particular, indigenous peoples have the right to be actively involved in developing and determining health, housing, and other economic and social programmes affecting them and, … to administer such programmes through their own institutions.” We wonder whether this bill will enhance and expand upon those commitments, and we hope the Minister might be able to give us some certainty in this context. But we are prepared to support the bill at this critical time.

NICKY WAGNER (National): At last there is a possible solution for owners of leaky homes. The Weathertight Homes Resolution Services (Financial Assistance Package) Amendment Bill, now in its second reading, will provide a new option and a faster fix for leaky and rotten homes.

Leaky homes have been a nightmare for thousands of New Zealanders and their families. It is estimated that approximately 24,000 apartments, townhouses, and stand-alone homes are affected. They were mostly built between 1992 and 2005, and they have proved to be an expensive disaster right across the country. Although the majority of leaky homes are in Auckland, my home town of Christchurch has had its share. But because of our cooler climate, it is expected that even more will be identified in the coming years. As an MP I have been personally involved with some of the cases, so I understand the stress, the anxiety, and the fear of homeowners. I have seen some really desperate situations.

Although the Weathertight Homes Resolution Service claims process was introduced in 2006, it proved to be a complex, lengthy, and expensive exercise. In some cases, the cost of the process proved to be more than the cost of the actual repairs or rebuild. Only about 4,000 leaky homes have actually been repaired, so we need a much faster, much more effective fix. We cannot continue to argue and debate. We want to stop litigation and start the repairs.

This bill moves us on past the blame game, and provides a financial package so that people can get their homes rebuilt in a better, faster, and cheaper way. The financial package may not be perfect, but the Local Government and Environment Committee believes that it is fair and effective, and that it will spread the costs as evenly as possible. The committee received 39 submissions, and overall there was general support for this solution. The package is a partnership. It is a partnership between local and central government, with each paying 25 percent of the total cost, while the homeowner is responsible for the remaining 50 percent. That 50 percent is backed by a Government loan guarantee. The package is totally voluntary for homeowners, but we expect that perhaps 70 percent of owners will take it up. It is an attractive alternative funding option, and it will deliver for affected families.

Local authorities have supported the project because, although it is a huge expense for councils, it caps the percentage of liability for the homes involved. The Government’s contribution is estimated to be a cost of about a billion dollars over the next 5 years, but both local and central government are supportive. They are supporting this financial package because it is the right thing to do. It is the right thing to do for the families who are affected, and it is a way for all of us to move on. Thank you.

Hon RICK BARKER (Labour): I will speak on the Weathertight Homes Resolution Services (Financial Assistance Package) Amendment Bill, and say that the Opposition will support this bill. Yes, the bill has been a long time coming, but although the previous speaker, Nicky Wagner, said that she wants to see the blame game over, one figures that within this legislation, and all the issues around it, the blame game has been played significantly by all parties.

One cannot underestimate the stress of homeowners who have built new homes and then see their homes leaking, sweating, and rotting around them. We must remember that a home, generally, is a person’s No. 1 major investment. It is not just an investment; it is a place where people live. It is an expression of people themselves. They put a lot of time and effort into decorating it, doing the grounds, and so on—it is where they live. To see their homes falling apart around them is very, very distressing for them.

There is no doubt that a number of factors have led to this situation. People have pointed to the deregulation of the industry, and I hope this House takes on board the consequences of having a totally deregulated industry. Lessons are to be learnt from this industry for a number of other industries that we deregulate. The fact is that we have an element of our society today that constantly carps in favour of deregulation and against regulation. They oppose regulation at every step of the way. But let this be a lesson to the deregulators: where there is insufficient regulation, the public are at risk. If people want to live in a completely deregulated society, with all the benefits that flow from having no regulations, then let them go and live in Mogadishu. They will be afraid of the water, the food, and the street violence, and there will be nothing there that is fit for the purpose for which it is being sold—unless it is some antique military arms.

We live in a civil society, and the purpose of a civil society is to protect ordinary citizens from the predations and incompetency of other people. We want a regulated industry. That means that when people undertake the tasks of design, building, and construction, they are skilled and fit for the purpose. This has been a failure on the part of many homeowners who built during the period of leaky homes.

We come to the issue of where we will apportion the problems. Councils, for their part, said they had no responsibility in the early stages, because they felt they were the victims of legislation to be passed by central government. They were simply following the deregulated environment of central government, and the problem lay with central government. Central government, on the other hand, said no, it was the responsibility of local councils because local councils had approved the homes being put up. Others pointed at the builders; others pointed at the designers of the buildings, the architects; others pointed to those who provided the monolithic claddings, and the seals, and so on that went with it. We had everybody pointing fingers at everybody, but in the middle of all of this the homeowners were left with stinking, rotting homes. That was well articulated by Sue Kedgley. I felt a seizure of catarrh and pneumonia coming on, as she adequately described all the health problems.

Phil Twyford: Stachybotrys!

Hon RICK BARKER: She likes that phrase: Stachybotrys, and all the other “greebs” and germs that go with it. No one has described it better than she. She is right: it is a health problem, a physical health problem. But I would add to the point that Sue Kedgley made that it is also a mental health problem. People have been incredibly stressed about this issue for a long time. When families are under stress of this nature, it adversely affects the whole family unit.

The families of the people who own these homes look to this Parliament for a solution. It could be possible for me to point out all of the failures of this legislation. There are some; it is not perfect. Very seldom do we pass legislation in this House that is perfect, and this is one of those pieces of legislation. It has its imperfections, but it has its strengths. The strength is that we will get the elements of the source of the essential problem. It will be central government, local authorities, and some liability will be placed on the homeowner. All three parties will have to come to grips with this and will have to pay their share. There have been some estimates of what it will cost, and the cost runs into billions. I think that is probably a very conservative estimate of the cost.

There will be another problem for the Government, which is how we undertake the fixing of these homes. I say to the Minister for Building and Construction and the members of the National Government who are responsible for training that the estimates are of 20,000-plus homes in Auckland alone. The Salvation Army in Auckland identified that Auckland is short by some 6,000-odd houses that need to be built. We have the rebuilding of Christchurch to undertake. In the next decade New Zealand will undertake more building and construction than it has in many, many a decade—probably in our history. There will be a massive amount of construction. The worry will be where we will find the skills and the tradespeople to undertake this work. At this stage I do not see a coherent plan from the National Government for how we will undertake this work. At present we should have many hundreds of young people, who are currently out of work, undertaking trade training in a mass way, similar to the sort of trade training New Zealand undertook at the end of the Second World War, when men came home from the war and New Zealand underwent a major reconstruction boom.

Jo Goodhew: We’ve announced it today.

Hon RICK BARKER: The member across the House chirps that they have announced it today. I read the announcement, and I have to say to the member that although it is an announcement, I think the size of it is timid in comparison with the size of the problem.

We have 20,000 homes in Auckland alone to be fixed. Auckland needs more homes; it needs in the order of 6,000 to 10,000 homes. That is 30,000 homes in Auckland. Then we have large sections of Christchurch to rebuild. I would like to think the Government will deal with this problem in a very strong, firm, and crisp manner. I do not see that in the release the Government put out today. Yes, it is a start; it acknowledges the problem; it takes its hat off and says we have an issue to deal with, but it does not grab the problem by the throat, wrestle it to the ground, and fix it. That is what we expect: strong leadership from the Government. It talks about leadership, but it has not delivered on it in this case. However, I will go back to the bill. I have been sidelined by interjections from the Government.

The issue here is about fixing leaky homes—making a plan. I say to the Hon Maurice Williamson that any plan is better than no plan. The Minister has come up with a plan, and all of the elements are there. I think many of the homeowners who currently suffer from leaky home syndrome will feel that they have a pathway forward. It might not be the perfect path, but at least it is a path. It is an acknowledgment by the Government that central government has a role in this and will support them. It also acknowledges the role of local government, and local government will also support homeowners. This should be of some comfort to many homeowners. It will of course wipe thousands and thousands of dollars off the balance sheet of many homeowners, and they will be poorer for decades to come. It will take many homeowners a long, long time to recover from this. It will make many of them very timid about building a new home in the future. They will be very cautious, and rightly so.

Labour supports this legislation. It will help to address the issues affecting many homeowners. Many issues remain unresolved, and Labour will raise a number of issues during the Committee of the whole House. It will put forward amendments, which we hope the Hon Maurice Williamson, who has taken the lead on this, will entertain very carefully and discuss with Labour as we go through the Committee of the whole House, in order to improve this legislation.

Hon Maurice Williamson: I’m happy to do that.

Hon RICK BARKER: The Labour Opposition welcomes that as a very positive acknowledgment that there needs to be some improvements in this legislation. The collective wisdom of this House should be able to bring to the House very good, improved legislation.

Labour will support this legislation, but it needs to be acknowledged that there are other issues on the periphery that are of concern. Those issues are the capacity and skills in the industry to undertake this massive repair work on thousands and thousands of homes across New Zealand, the under-build of homes in Auckland, and the rebuild of Christchurch. This is a substantial undertaking. The Government needs to take it seriously and really put in place some solid, enduring policies that will give the industry the skills and tradespeople necessary to undertake this substantial amount of work.

Dr CAM CALDER (National): It is a pleasure to rise and speak on the Weathertight Homes Resolution Services (Financial Assistance Package) Amendment Bill. The bill is very, very important to our country and to many thousands of hard-working New Zealanders. A home is fundamental to providing safety and security to body, safety and security to family, and safety and security to property, which underlies Maslow’s hierarchy of needs for the human condition. A home is crucial to the health and the emotional and economic well-being of our people. I wonder who among us has not heard this line from a John Howard Payne poem:

Be it ever so humble,

there’s no place like home;

I acknowledge the contributions from members on all sides of the House in the Local Government and Environment Committee. Our bid is to come up with a financial assistance package to help New Zealanders get their leaky homes fixed faster. We must move beyond what has been a period of dispute and litigation. This package is about spreading the cost as evenly and as fairly as possible to get action. We need to help affected homeowners get on with their lives.

So what is the problem? I am a homeowner myself. I know a lot of friends who are carpenters and builders. They have told me that all properties leak. I have had that experience myself. In certain conditions, with wind coming in from a certain quarter and with torrential rain, some water will come into my home. It is an old home that was built in a traditional manner. The water comes in and drains out, the wood swells a little bit, conditions change, and the wood reverts to form and dries out in a reasonable period, and there is no problem.

But a problem occurred with the advent of a new building material. I can remember it appearing around Auckland, when a little bit of a blight started in the early 1990s. It was sort of a building envelope in Insulclad-type construction, which is a cladding system, and there were many others. The problem was that any water that got into the fabric of the home could not drain out. It affected townhouses, apartments, and stand-alone—or, as the English call them, detached—homes. It is interesting that leaky homes are not just a problem for Auckland. Probably 75 percent of leaky homes are in Auckland, but Wellington, Tauranga, and Christchurch are also affected. I believe, having asked the chief executive in Dunedin, that there is one in Dunedin.

Clare Curran: One what?

Dr CAM CALDER: One leaky home—one only. Things move glacially. In 2006 the Weathertight Homes Resolution Services Act was the primary legislation passed, but, prior to that, the Government of the day seemed to believe that no problem existed. In 2002 the then Prime Minister said she had not taken much notice of the New Zealand Herald’s article on the issue, because the New Zealand Herald was well known for banging on about issues of no substance. Not surprisingly, that statement surprised the industry, including Prendos Director Phil O’Sullivan, who at that stage had been campaigning for 4 years to alert the Government to the problem and had asked for it to be addressed. He said that he was surprised the Prime Minister was badly informed. He said: “They need to take it seriously and not dismiss it. We’ve had the BIA [Building Industry Authority] dismiss it and the minister dismiss it and they’ve all been caught out. We’ve got no doubt [about the size of the problem]. We just go to site after site after site.”

This bill is this Government’s attempt to address a very serious problem. The legislation will deal with the forecast for leaky homes, which varies from somewhere around 22,000 homes to as many as 89,000 homes. The consensus forecast is that some 42,000 affected homes are likely to be leaky. We know that it is often very difficult to tell how badly affected a home may be.

At the time of the 2009 report, unfortunately 9,000 leaky homes were deemed to be outside the 10-year liability period. As a member of the select committee, I must say that it was a great sadness to me that even with the best will in the world there will be some homeowners who will not be able to find solace in this package. But we are doing our best to provide a process that will provide certainty without recourse to costly disputes. We have heard that this approach is a partnership, as it were, between local government providing 25 percent and the Government providing 25 percent. It is a voluntary process for the homeowner to be involved in, should they wish to be. They have the right to be involved if they decide to be, but they forgo their right to sue the local authorities or the Crown, although they are able to sue other liable parties, such as builders, developers, and manufacturers of any products that are deemed to be defective.

I look forward to contributing further to the debate in the House as the bill progresses. At this stage I commend the bill.

Hon SHANE JONES (Labour): Today the readers of that troublesome, irritating media outlet otherwise known as the New Zealand Herald have been given a very clear example of the treacherousness of the territory surrounding the issues that the Weathertight Homes Resolution Services (Financial Assistance Package) Amendment Bill seeks to address. I say no other words than “Pepperwood Mews”. Pepperwood Mews are an institutional, physical representation of what the bill seeks to do. But it goes further than that. Pepperwood Mews are evidence of egregious, scandalous behaviour on behalf of the New Zealand housing agency, which is wriggling out of its obligations, in terms of its own culpability in destroying the savings and affecting the mental health of people who in good faith invested in what has turned into a leaky building disaster. To make matters worse, the super-city, having taken over the responsibilities of Waitakere City Council, has also hired deep-pocketed Queen Street - based lawyers, whose willingness to solve the problem is inversely related to their appetite for ongoing fees.

The issues in this bill need to be sheeted home, and we need to find a context where we can talk about the people who have suffered. We also have a very spotty record as parliamentarians. I will be the first to say I support this bill, along with our spokesman and my colleagues. I would also be the first to say that when I was the Minister of Building and Construction, the figure confronting the Crown dwarfed a lot of our analysis. At least the current Minister has brought forward a potential solution, admittedly—I would not say a half-pie solution, because that would suggest that he has not been professional, and on this it is evident that the Minister has had a beggar of a time shepherding forward a solution.

I go back to the Pepperwood Mews example in west Auckland. There is a set of buildings—one might charitably call them terraced housing—that are now unfit for habitation; possibly good for poultry, potentially good for demolition work. Those buildings need to be fixed up. Will this legislation require the Crown to do good in terms of its own role in such episodes? No. Secondly, it shows that not only is the Crown not standing behind its remedy in terms of liability but also it is allowing a key organisation in the Crown infrastructure to worsen the prospects of the people behind that particular investment enjoying any remedy whatsoever.

An area where the Government has failed egregiously is in its unwillingness to seriously invest in vocational and apprenticeship training, because this will require a mountain of work. The only way that this could have been broadened and made into quite a popular cause was for it to be used as a platform to create and deepen the new cadre of building practitioners: tradespeople who will actually contribute, not only to the rebuilding of Christchurch—Lord knows when that will actually happen—but also to dealing with leaky homes drama in Tāmaki-makau-rau.

Although we agree, obviously the banking fraternity is playing the long game, hoping that a Government will at some point in time underwrite its role in seeking to remedy this problem. Secondly, we will face an inordinate skills shortage. We know that the magnetic impact from across the Tasman in terms of its natural commodities boom is drawing lots of our tradies over there. Therefore, a sensible Minister and a Government with a vision would be willing to gather up young people and put them into training, so that we shorten the line of people looking for jobs. Many of the people looking for jobs should actually be in jobs fixing problems such as this, but they are not, because they are not being rewarded or encouraged to go into training. If there are not people in training, then where will they go? They will join the unemployment queue, which is giving this very dismal picture of more and more young men and women wasting their lives looking for jobs. There is no shortage of opportunity in dealing with issues such as this for skills, vocational training, and employment, because if there is one good thing that can come out of this problem, it is that we can train and provide jobs for trainees at a level that we cannot possibly imagine.

It will take money. Well, if the Government did not spend all the money on a very narrow cast of economic players in the New Zealand economy and give them this massive tax benefit, then it would have money to invest in the most valuable kind of capital that any society has in excess—that is, human capital. But that was squandered. So let us ponder for a moment on why the banks are unwilling to come to the party. Minister Williamson has, correctly, been quite judicious about this. I suspect that the Australian-owned banks are giving instructions to their New Zealand staff: “Enough exposure in this sector.”, and they are hoping that the New Zealand Government will give them an underwrite. Well, this particular Government has provided, in my view, enough underwrites. Whether or not it felt it had no opportunity, whether or not it inherited historical obligations, the fact of the matter is that we cannot continually dance to the tune or jump to the beck and call of the banks. I think that a tremendous gesture for them to make would be to allow people to get on with their lives, begin to repair these aquariums that used to be called houses, and try to lessen the damage that has been done to their physical and fiscal well-being.

Potentially, a whole generation of people has been wiped out, when we add this problem to the meltdown of the financial companies—the intermediate finance, the mezzanine finance—and when we also look at the level of suffering visited upon a bunch of day-to-day Kiwis as a consequence of the Christchurch-based earthquake. What does all this point to? This points to the importance of training and developing the next generation of New Zealanders who can generate solutions that will have a practical form and a long-lasting benefit.

Minister Williamson has reflected a desire during the Committee stage to take on some of our suggestions, or to at least listen to them; he is highly unlikely to take them on. After all, he has the distinction in a former life of showing Steven Joyce how to ruin the telecommunications industry, so it is unlikely that that sort of deeply imprinted political DNA is about to change. But I direct his attention to the fact that under his watch, the building and construction industry has become anaemic. Under his watch, consents have plummeted. But under his watch there has been a growing and desperate need for more houses, and more housing solutions—because they will not all be houses—in Tāmaki-makau-rau, in Auckland. As people swell the place as a consequence of domestic migration, this Government continues to say: “Well, we’ll look to private - public sector innovations.” If members want to know how it goes wrong, they should go to Pepperwood Mews.

It is disappointing that unfortunately very few National MPs have either heard of that episode or know where it is located. But, rest assured, the people who are suffering know. They know that this Minister has had 2 years to remedy that situation, but, rather, he and Mr Heatley are quietly encouraging, I presume, the commercial directors there, that whatever they do they should not expose any further liability and they should not put their hands up to solve the problems for those day-to-day Kiwis. So although we support this bill, there are many areas where it can be improved. Kia ora tātou.

CHRIS TREMAIN (National—Napier): I feel a real need to respond to Mr Jones, following his 10-minute diatribe. One of the things Mr Jones said was that the Minister, Mr Williamson, had failed egregiously in bringing the Weathertight Homes Resolution Services (Financial Assistance Package) Amendment Bill to the House. Let us reflect on the situation. If we take the PricewaterhouseCoopers report, we are talking about anywhere between 22,000 and 89,000 homes that are affected by the leaky homes issue. That is a major problem for people around this country, and it is one that gained huge momentum during the 9 years of a Labour Government. To say that Mr Maurice Williamson has failed egregiously is so far from the truth that it is ridiculous. Mr Williamson has come up with a solution to solve the problem.

Anybody who runs a constituency office will have had many, many meetings with constituents who have major issues with leaky homes. It has not been the issue in Hawke’s Bay and Napier that it has been in the likes of Auckland, in particular, and in other parts of the country, but I have dealt specifically with two or three cases where people have this issue—one on the Napier hill and one in Greenmeadows—and where, quite frankly, builders had walked away from the situation. The builders carved up their companies, become insolvent, and walked away from the issue and from homeowners who had invested their life and soul into those properties. The time it takes for these people to resolve the issues caused by their leaky home is really heart-wrenching in this whole situation. It leads to poor health and major stress and is a real issue for these people.

To think that during the 9 years of a Labour Government it never reached a solution that could help move this thing forward begs a whole lot of questions that National members asked during the 9 years of the Labour Government.

We have reached a solution here. It may not be the ultimate thing that all homeowners wanted, but the assistance package of 25 percent from the Government, 25 percent from local government, and 50 percent from homeowners provides us with something to move forward with. I think that for many homeowners around the country who are affected by this issue, the bill is a major step in the right direction. For Mr Jones to say that the Minister has failed egregiously is so far from reality that it required me to stand up and take a call to debate that. Thank you.

Bill read a second time.

Bills

Television New Zealand Amendment Bill

In Committee

Part 1 Amendments to principal Act

Hon Dr JONATHAN COLEMAN (Minister of Broadcasting): It is a pleasure to take a call in the Committee stage of the Television New Zealand Amendment Bill, which brings to a head our election promise in relation to the repeal of the Television New Zealand charter.

Of course, under the last Government Television New Zealand had been labouring for quite some time under what was effectively an unworkable dual mandate. We said when we came into office that we would give Television New Zealand a clear and honest path ahead. When we look at what has happened with the charter in terms of the content on Television New Zealand, we see that people would really struggle to tell any difference between the content before the charter, during the charter, and after the charter. So really it was a fig leaf covering up a lot of sins laid out by the last Labour Government. It had 9 years to get its house in order in terms of public broadcasting.

Hon Member: Sins!

Hon Dr JONATHAN COLEMAN: “Sins” was probably not the right word to use. The fig leaf was modestly covering what was masquerading as public broadcasting under the last Government. The reality is that Television New Zealand has been 93 percent commercially funded for many, many years now, under this Government and the last Government. The last Government tried to pretend it had a public broadcaster. In fact, it had a publicly owned broadcaster that at times showed public broadcasting content, and it will continue to do so once the charter is repealed.

This is a very honest and straight up bill. It removes the charter and replaces it with a set of statutory functions. The statutory functions of Television New Zealand are “to be a successful national television and digital media company providing a range of content and services on a choice of delivery platforms and maintaining its commercial performance.” I think it would be very hard to argue credibly against that. Furthermore, in carrying out its functions “TVNZ must provide high-quality content that—(a) is relevant to, and enjoyed and valued by, New Zealand audiences; and (b) encompasses both New Zealand and international content and reflects Māori perspectives. (3) TVNZ’s services must include the provision of channels that are free of charge and available to audiences throughout New Zealand.”

A further part of this bill makes available works previously locked up in the Television New Zealand archives—works that were made before the Broadcasting Act 1989. Up until this point a very complex process had to be gone through for those works to be seen, involving, basically, contacting every single person on the rolling credits shown at the end of each episode, which proved unworkable and meant that that material was never ever seen.

This legislation will replace the current arrangements with a scheme whereby a reasonable attempt can be made to notify people involved with the production. They can come forward and apply for compensation for the programme being shown, and if they do not come forward, the programme can still be shown. The legislation is bringing out a very workable scheme to unlock the Television New Zealand archive. The public will benefit from this; it will certainly be good for the producers and for the actors, and we think it is a very practical way forward.

When one looks at what we have done, one can see a very clear, honest approach to public broadcasting. We have maintained the $231 million a year that goes into public broadcasting. We have said there are a number of ways in which we can provide public broadcasting, and New Zealand On Air is an excellent model. We think it is best if we put the money through the New Zealand On Air model so that the best productions get a chance to be seen on the screen, and the public benefits.

Let us face it: the public today do not mind where they watch the content; they just want access to the content. I would be very surprised if anyone in this Chamber were to disagree with us on the point that the New Zealand On Air model does a great job for New Zealand, and has provided great content on the screen for New Zealanders for many, many years. This is just the next step in repealing the Television New Zealand charter.

Clare Curran: What’s next?

Hon Dr JONATHAN COLEMAN: What is next is the third reading. It will be very interesting to see whether Labour, in its broadcasting manifesto, will say it will reinstate the Television New Zealand charter—I will not hold my breath. I think Labour members will talk big on this, but I do not think we will actually see any action. They had 9 years to do something. If they really wanted to turn Television New Zealand back into a fully State-funded public broadcaster, they had the chance to do that. If they want to do that at the election they should say so, but they should also say where they will get several hundred million dollars a year to run it.

I commend this bill to the Committee.

CLARE CURRAN (Labour—Dunedin South): Thank you for the opportunity to speak in the Committee stage of the Television New Zealand Amendment Bill, to which Labour is fundamentally opposed. I want to talk about the public interest, which is an extremely important principle that underpins our opposition to this bill. The Government is doing away with the Television New Zealand (TVNZ) charter, getting rid of TVNZ 7, stopping New Zealand from having a public broadcasting television station, and leaving us in a situation where New Zealand and Mexico appear to be the only countries in the OECD that do not have a public broadcasting channel. The Government is also freezing funds for Radio New Zealand National, which is essentially a cut, while at the same time doing sweetheart deals with MediaWorks. There is a very dodgy relationship between the Government and a commercial television station, and there is mounting evidence that although there was a plan to keep TVNZ 7 going and to likely merge it with Radio New Zealand National, something happened to stop that.

Now we are left with nothing except the weakness of the Minister of Broadcasting, Jonathan Coleman, who does not have any real plan for public broadcasting in this country other than to get rid of it. If he did have a plan, then he has been rolled. There is also the weakness of the Prime Minister and Ministers, as I said last week, in kowtowing to—

Hon Dr Jonathan Coleman: This is the same speech from the last reading.

CLARE CURRAN: It is good that the Minister may be able to respond. Labour is emphatically opposed to this bill.

I have a little story to tell today about this Minister and public broadcasting. The Government spends much more time with the commercial broadcasters than with the taxpayer-funded broadcaster. Last week I told members that the Minister of Broadcasting has met with the board of MediaWorks nine times since the election, and that six times of those times were last year—that is once every 2 months. I am still waiting for answers on what he actually talked about. Last week I also asked the chair of the board of Radio New Zealand National, Mr Richard Griffin, how many times the Minister had met with Radio New Zealand National since the election. Twice, I was told. That is since the end of 2008. Yet Radio New Zealand National is our public broadcaster, and it has had its funding frozen, which it admits represents a cut. It is trying its hardest to stay afloat, and one would think that the Minister would spend more time with it and pay it more attention. We do not know how many times the Minister has met with the board of TVNZ—he has not told us that yet—or how many times he has met with the board of Sky. Those questions are with the Minister, and we are waiting for answers.

In fact, other issues we are waiting for answers on are about the withholding of information on the business plans for TVNZ relating to TVNZ 7, and about the proposal that was prepared and put to the Minister to try to keep TVNZ 7 afloat. In a select committee a couple of weeks ago TVNZ told me it had provided the Minister with proposals about keeping TVNZ 7. Will the Minister release that information? No, he will not release it, but we will keep trying. The proposal is called “TVNZ 7 investment scenarios”, and it has been withheld for commercial reasons. Why would that be, given the widespread public concern about the decision to discontinue funding for TVNZ 7: about the public interest issue, and about the potential harm that this decision might cause to the whole public broadcasting environment in New Zealand? One can admit and accept that it might be legitimate to withhold financial figures that might be reasonably expected to compromise TVNZ’s commercial interests if they were made public. But it is difficult to make that argument with regard to TVNZ 6 and TVNZ 7, given that TVNZ 6 has already ceased operation and that the Government has now announced its decision to cut TVNZ 7. So it would be interesting to hear the Minister say why that information cannot be made public. After all, it is difficult to argue that either TVNZ or the shareholding Ministers have any commercial interest in withholding information on channels that will not be continued.

That brings me to another issue, which I mentioned before, about the Minister having spent a lot of time meeting with the board of the commercial television broadcaster and very little time meeting with the public broadcasting sector. Of course, we all know that MediaWorks was given a $43 million loan from this Government to defer the company’s spectrum licensing payments. That happened at a time when the Government was deciding to axe the Television New Zealand charter, which is the central issue in this bill and a very central public interest issue. It also happened around the time that the decisions were made to freeze the funding for Radio New Zealand National, which is essentially a cut to that funding, and then to make TVNZ 6 go commercial, and subsequently to cut the funding for TVNZ 7 altogether, leaving New Zealand with no national public television broadcaster.

I want to share a little story with members about the public interest issue, and it relates to this bill because in substance the bill attacks the public interest by doing away with our public television broadcaster and doing away with the charter. That makes TVNZ behave as a commercial broadcaster would, which is not in the public interest. It is also not in the public interest to give MediaWorks a $43 million loan, and the Minister well knows that. I would like to share with members that in May 2009 the Minister for Communications and Information Technology wrote to the Radio Broadcasters Association and rejected its request for a deferral of spectrum licensing fees, because that would be a fiscal risk to the Crown. The Minister said he was not convinced that the Crown ought to be an alternative to services. In August 2009 the Ministry of Economic Development advised the Government that there had been much lobbying by MediaWorks and the Radio Broadcasters Association, including an approach to the Prime Minister, which we now all know about. They were recommending that a single channel of communication be used to ensure there was no risk of creating ambiguity or mixed expectations. In September 2009 they advised Ministers that the MediaWorks problem was with its capital structure, not its long-term viability, and the advice was accompanied with a Deloitte’s report.

In October 2009 a memo went to Cabinet and noted the urgency of making a Cabinet decision on a deferral of MediaWorks’s spectrum licensing payments. That stemmed from MediaWorks’s capital restructure plans, so there was no public interest issue there. Late in September 2009 a draft Cabinet paper noted MediaWorks’s lobbying and Treasury’s misgivings, because it saw the move as a policy shift. It required a sign-off under the Public Finance Act, but Treasury did not spot that at the time. Treasury opposed the deferral of spectrum licensing payments, and we know that Treasury and the Ministry of Economic Development opposed the deferral and the providing of a loan to MediaWorks. [Interruption] That was a very significant public interest issue. In October 2009 a draft Cabinet paper showed that the urgency was all about the arrangements with the banks for a capital restructure. Treasury advised on the risk of the Crown becoming a creditor and acting as a bank. The Cabinet decision went through in October. Cabinet approved the alternative payment arrangements, despite that advice from Treasury and the Ministry of Economic Development.

But then Treasury worked out that there was a problem, because under section 65 of the Public Finance Act the deferred spectrum licensing payments required the approval of the Minister of Finance—

Peseta Sam Lotu-Iiga: I raise a point of order, Mr Chairperson.

CLARE CURRAN: —which it had not got—

The CHAIRPERSON (Eric Roy): Order!

Peseta Sam Lotu-Iiga: I raise a point of order, Mr Chairperson.

CLARE CURRAN: —and in order to get that—

The CHAIRPERSON (Eric Roy): It is for me to control the Committee, not the member. A point of order has been called, and I indicated that without standing up. The member may not have heard me, but to continue to talk louder is not appropriate.

Peseta Sam Lotu-Iiga: Thank you, Mr Chairperson. The member is talking about radio contracts, which have nothing to do with this bill. I urge you, Mr Chairperson, to ask her to reconsider her speech in terms of Part 1.

Hon Pete Hodgson: Mr Chairperson—

The CHAIRPERSON (Eric Roy): I will listen to the member.

Hon Pete Hodgson: I think that is a bit rich, coming from a member who approached—

The CHAIRPERSON (Eric Roy): Members must not attack another member when they make a point of order. They must stand up and state the point. I was looking for assistance, not to see people get roused. I will give the member another chance to make a point.

Hon Pete Hodgson: Thank you for your help, Mr Chairperson. I just recall that the Minister, when he made his opening remarks in the Committee stage, spent the first several minutes on attacking the 9 years of the Labour Government in a somewhat provocative and angular way, saying it was masquerading as delivering public television, covering the cracks, and all sorts of other things that were really outside what an ordinary Committee stage would sound like. So I would have thought that measured against that, my colleague’s contribution was mild, indeed.

The CHAIRPERSON (Eric Roy): Yes. I really am very much in favour of members’ speaking specifically to the bill, but when we deal with Part 1 there is a purpose of the Act, and I guess that opens it up a little notch. As has been pointed out, I think most sides have done that. I do not think it assists in the final determination to get too political as we go on, but I have been listening to what the member says. As long as members tie in those illustrations to the purpose of the legislation, I think they are marginally inside the boundary but a bit further out than I would prefer them to be.

CLARE CURRAN: Thank you, Mr Chairperson. This issue goes directly to the public interest in terms of cutting or axing the Television New Zealand charter.

The point I am making is that under the Public Finance Act the Minister of Finance had to sign off that loan. There was no public interest, and what had to be found was a reason for public interest. The facts and the paperwork show quite clearly that there was a scrambling around, looking for a reason relating to public interest. The Minister for Communications and Information Technology made it clear to the Minister of Finance that there was a problem, and that if the Minister of Finance did not sign off the loan, then the policy would be unlawful. The Ministry of Economic Development suggested that the public interest test could be met, but only on a technicality of a retraction of the deferral, avoiding the minimal risk—I stress the word “minimal”—of business closures and destabilisation of the broadcasting sector. That was a market rationale, not a public interest rationale. The bigger issue was the significant risks to Government credibility for licence renewals and to damaging good faith with the industry. This was really all about the Government’s bumbling on this issue, and the fact that it had to scramble around and find a public interest test.

SUE KEDGLEY (Green): The Television New Zealand Amendment Bill is shameful legislation. It strips all the public service purposes from Television New Zealand (TVNZ), which will now exist for one purpose and one purpose only, which is to return a dividend to the Government. So we are left with the dubious honour of being the only country in the OECD, aside from Mexico, that does not have a national, public service, mainstream broadcaster. Every other self-respecting democracy understands the importance of public service broadcasting to a healthy democracy and an informed society. There is public service television in the Middle East, in Africa, and all through Europe, but in New Zealand it seems we do not need it.

People are asking why this Government is so hostile to public service broadcasting. Why does this Government have an agenda? Why is it setting out to demolish public service broadcasting across New Zealand by, firstly, in this bill, stripping TVNZ of all its public service responsibilities; secondly, refusing to fund the last two remaining channels—TVNZ 6 and TVNZ 7—so there will be no public service channels left; and, thirdly, deliberately starving Radio New Zealand of funding, so that it will stay in a weakened state, on the back foot, and will ultimately be forced to commercialise?

People are puzzled. What is the Government’s agenda in trying to demolish—actually, not trying, but demolishing—public service broadcasting? I want to speculate on the reasons. First of all, the Government does not seem to understand the importance of having a truly independent, impartial broadcaster that is free from commercial pressures and can speak out without fear or favour. In fact, I do not think the Government wants a public broadcaster that can speak out without fear or favour. Government members do not seem to understand that if an entity is beholden to sponsors, to advertisers, then it is beholden to them and it will not bite the hand that feeds it. “Mazda Morning Report”, for example, will not turn round and criticise Mazda for any potential failures. Government members do not seem to see that.

What Government members do understand extremely well is that they are committed to helping their mates in commercial broadcasting. Their mates in commercial broadcasting—two of whom have become Ministers; Steven Joyce and Maurice Williamson started their lives as commercial broadcasters—see public broadcasters as a threat. They resent the idea that Radio New Zealand, for example, should get taxpayers’ money. Commercial radio broadcasters do not want competition from a public broadcaster like Radio New Zealand. Brent Impey has been very upfront about this. They do not want the competition from them for market share, but they do not want them competing for the advertising dollar, either.

What Government members want to do, as far as I can see, is try to remove as much public service broadcasting as they can—which is almost everything—and if they have to, in the short term, put up with Radio New Zealand, they want to starve it of funding, weaken it, and keep it on the back foot. What they do not seem to accept is that public service broadcasting, if it is not completely driven by television ratings, can look at different ideas and different perspectives. It can look at the public interest and not just at ratings. People in TVNZ will tell us that, basically, the sole criterion of whether a programme will screen, particularly in prime time on TVNZ, is purely whether the sales department thinks it will produce ratings. That is the sole criterion of programmes on TVNZ.

Here we have a Government that is intent on destroying public service broadcasting and helping its mates in commercial broadcasting. Clare Curran has spoken at some length about the fact that the Government has rushed to rescue MediaWorks, the company Steven Joyce set up and a commercial competitor of TVNZ, and is funding it. Actually, it is subsidising it; not funding it directly. It is effectively funding it by subsidising it on a $43 million loan deferral scheme. So the agenda is quite blatant. The Government wants to do everything it can to help its mates in commercial broadcasting, and it wants to do that by destroying public service broadcasting.

There is one other matter I want to raise, and it is the rather puzzling aspect of TVNZ’s strategy at the moment. Since TVNZ has been stripped of all its public service obligations it now exists only to make money. It told the recent financial review at the Commerce Committee that the main growth area for TVNZ’s business is now expected to be in pay television, and it is planning to pitch even more channels to Sky television. Already it has two channels on Sky television, and now its main growth focus is on pitching more channels. What is clear is that the Government also has an agenda to switch New Zealand away from free-to-air television, to pay TV. Really, it wants all of us, if we want television, to pay for it. The Government’s clear objective is to move away from free-to-air television and move to pay TV, and I believe that it will use the whole digital switchover to move along this agenda. So I predict that not only will we not have public service broadcasting but we will not have free-to-air broadcasting; we will have only commercial broadcasting, pay TV—that is the agenda.

What would happen if, for example, TVNZ were to be sold, which is clearly the Government’s agenda if it can find someone to sell it to, and TV3 were to go bankrupt? We would be left simply with Sky television. What would happen? We would effectively end up with Fox Television in New Zealand. We would effectively end up with one commercially driven broadcaster owned by Rupert Murdoch, who owns Fox Television in America. We would end up with one broadcaster having a channel on which it can ensure a particular bias, a particular right-wing bias. Anyone who has watched Fox Television knows that quite unequivocally. We can see the bias of Fox Television. We have to be realistic and say this is where we could end up in New Zealand, now that the Government has succeeded in demolishing public service broadcasting, is assisting its mates in commercial television, and trying now to roll out the red carpet for Sky television. I notice that Sky television is now going to be able to compete—

Paul Quinn: You are rich enough to be your own broadcaster.

SUE KEDGLEY: Mr Chair, could you please do something about that ridiculous backbencher Mr Paul Quinn, who cannot do anything in this Chamber, it seems, except shout and seek to intervene. I request your protection from his shouting.

The CHAIRPERSON (Eric Roy): Are you raising a point of order?

SUE KEDGLEY: I am raising a point of order. I am sorry—thank you, Mr Chair. I am asking you to protect me from the constant shouting—

The CHAIRPERSON (Eric Roy): Points of order will be heard in silence.

SUE KEDGLEY: —of that ridiculous member.

The CHAIRPERSON (Eric Roy): I am on my feet. The member on her feet has made some comments that might be more political than specifically about Part 1. Firstly, we have had a somewhat philosophical speech, which is more a first reading speech, shall we say. It has not dealt with the detail of Part 1, so there has been something of a response. I cannot control what the member says, and the member then asks me to control what the interjections might be. I make that point. Secondly, I make this point to those people who are interjecting. There is a decorum about “rare and reasonable” and I think the members did overstep that mark.

Clare Curran: I raise a point of order, Mr Chairperson.

The CHAIRPERSON (Eric Roy): I have ruled on the point of order. I now ask Sue Kedgley to continue.

Clare Curran: Can I—

The CHAIRPERSON (Eric Roy): Is this another point of order?

Clare Curran: I raise a point of order, Mr Chairperson. I understand there is a Standing Order that relates to a member who moves seats in the Chamber and—

The CHAIRPERSON (Eric Roy): I am on my feet. I can help the member. Yes, there is. There is quite a suite of Speakers’ rulings. It is not actually a Standing Order; it is a Speakers’ ruling. The one of pertinence is about members moving specifically to give themselves an advantage. I think it could well be argued in this case that if Mr Quinn was in his usual seat, he would have a greater advantage—

Hon Members: Ha, ha!

The CHAIRPERSON (Eric Roy): It is also the custom of the House that members coalesce into two groups on either side, so I do not think we could say that the movement of the member is to enable a more effective interjection programme.

SUE KEDGLEY: I believe that, because the purpose of this bill is to strip TVNZ of its public service functions. I was speaking to that point. I was saying that having stripped TVNZ of its charter, of its public service functions, no doubt with a view to readying it for sale, we could end up with, effectively, a foreign-controlled broadcaster running all of the television channels in New Zealand.

BRENDON BURNS (Labour—Christchurch Central): First I will pick up on some comments from the Minister of Broadcasting around the supposed inaction of the Labour Government on broadcasting and how NZ On Air provides the sort of broadcasting variety that we would all like to see more of. I put the point to the Minister that, as of a week ago, New Zealanders believed that KiwiSaver was intact after a cut as this Government came into office, which it had signalled prior to coming into office. New Zealanders are now discovering that the scheme that they were promised would be left intact will, in fact, now have an axe taken to it.

Hon Dr Jonathan Coleman: I raise a point of order, Mr Chairperson. I cannot see in what way debate on KiwiSaver is related to the Television New Zealand Amendment Bill.

The ASSISTANT SPEAKER (Eric Roy): It is going to be a long afternoon.

BRENDON BURNS: Speaking to the point of order, I am drawing an analogy between the Minister’s comments suggesting that NZ On Air provides funding and is secure for the provision of alternative content for television other than the content that might be provided under the commercial model, which is the heart of the change—

The CHAIRPERSON (Eric Roy): I have got your point. It is certainly the practice of the House at times to make comparative illustrations. Rather than jump up and immediately say that a member has mentioned this word or this phrase, I prefer to give a bit of context around that. This debate is not an opportunity to relitigate, debate, or expand on issues that do not have pertinence to the bill, but it is within the bounds of debate in the Committee stage to make comparative illustrations, and that is where the member should confine himself.

BRENDON BURNS: We come back to the function of this bill. Part 1, clause 4(b) specifies that the purpose of the Act will be to “ensure that TVNZ carries out its functions and maintains its commercial performance;”. That is the heart of Part 1, the heart of clause 4, the heart of the bill, and the heart of the Government’s broadcasting policy.

If we look at this Minister’s record in respect of that, we see that it is not flash, in terms of a situation that began with him refusing to have a review of the competition issues within television, particularly when that was despite Treasury’s Crown Ownership Monitoring Unit saying that not having such a review would risk eroding the shareholding that the Crown owns in Television New Zealand (TVNZ) as Sky became increasingly dominant. That was the starting point of this Minister’s tenure as Minister of Broadcasting.

Next, he moved in quickly to freeze Radio New Zealand, to the point where its new chair suggests that it may have to raise funding through cake stalls and selling its grand pianos. I also note that the Radio New Zealand Amendment Bill has been languishing on the Order Paper for more than a year and a half since the charter ended and was due to have been renewed at the beginning of January last year.

I will come back to the functions of TVNZ, as prescribed under Part 1, and TVNZ maintaining its commercial performance. In fact, TVNZ has been following this Minister’s dictates for most of the last 2½ years. One example of that alone was in May of last year. The content that New Zealanders had paid for through their broadcasting licence fee back in the 1970s and 1980s, through their ownership of TVNZ, is not available to them, but it is available to them if they want to take a subscription to Sky television and watch the Heartland channel. They cannot watch their own back content on a specific channel, but they can watch it if they want to pay the coin to Rupert Murdoch. That is another example of how TVNZ, even before this bill is passed by the House and given effect to, is already tipping its cap to the signals the Minister has provided. That is just disgraceful.

TVNZ 6 has already gone—it has become a music channel—and TVNZ 7 is going next year. Where is the legacy of this Minister in respect of the broadcasting portfolio and in respect of TVNZ? Things have been frozen, things have been lost, things have been cut, and things have been handed across to the private sector, and that is a woeful track record.

I will pick up on the points that my colleague Clare Curran raised in respect of the Minister’s contact with the board of MediaWorks. I note that he has met the board nine times as Minister, and six times last year, as a sweetheart deal was being brought together for that media organisation. He has met the board of Radio New Zealand two times in the entire tenure of his holding the broadcasting portfolio. I do not know how many times he has met TVNZ’s board—the board for which he has responsibility—but I would like to know. I would be interested to know whether it is as many times as he has met the board of MediaWorks, for which a sweetheart $43 million loan deal was organised. Of course, the Minister and the media organisation will deny that that deal carries any editorial influence for the Government. I say to the Committee, as someone who has sat in a senior editorial position, that nobody had to tell me that we had to bend to a particular master in respect of a media organisation, but subtle signals were sent. I have to raise very serious questions about the editorial integrity of media organisations under MediaWorks and ask their journalists to assert very loudly, publicly, and clearly that they are not getting implicit signals from their owners in respect of whether they should be giving the Government an easy ride because the Government has come to the rescue of that organisation with a sweetheart $43 million deal—

Hon Member: Deferred licence.

BRENDON BURNS: That is right; it is deferred. I will tell members that other people would very much like $43 million in deferred licences. Many organisations would like that. It has taint around it; it has disgraceful taint around it. It is a sweetheart deal for a media organisation. It is not appropriate in a democratic country like New Zealand that a Government provides a sweetheart deal to a very influential media organisation that not only has a strong television network but also has a suite of radio stations. It is wholly inappropriate, and in any other democracy around the world it would absolutely be looked down on and commented on. It is just not appropriate. It is another hallmark of the tenure of this Minister in Government that he met that organisation six times last year, as that deal was being brought together. He has met that board nine times in the course of his tenure as Minister, and twice met with the board of the organisation that he has imposed a swingeing freeze on, at a time when there was an established KPMG report that said Radio New Zealand was desperately short of funds. We now have the new chair of Radio New Zealand suggesting cake stalls and piano sales in order to try to fund the future of that allied broadcasting organisation.

I come back to Part 1, which effectively repeals the charter and says to TVNZ that all it has to do is maintain its commercial performance. Let me give an example of the sorts of ramifications that has. Next weekend in my city of Christchurch there will be a telethon. There will be a global telethon to raise money for the Christchurch Earthquake Appeal. I applaud that initiative. Who is doing the broadcasting for it? Do we look to our State broadcaster to provide all the technical expertise, staff resources, camera operators, networks, stars, and personalities to try to give some mana to that effort to raise money for my desperately needy city of Christchurch? No, our State broadcaster is not doing that. Why is our State broadcaster not doing that?

I acknowledge, looking at Georgina te Heuheu opposite, that Māori Television has stood up and has taken on that role. Māori Television is becoming the State broadcaster for this nation, in the absolute absence of anything resembling a State broadcaster that should be stepping up to the plate and should be helping beleaguered communities like mine in Christchurch Central that are desperately in need of funding, support, and assistance.

In the past we have looked to our State broadcaster to step up to the plate and provide that kind of leadership, because it has the mantle to do that, the signal from the Government to do that, the connections to do it, the will to do it, and it is allowed to do it. But under Part 1 of this bill, TVNZ is told that the only thing it has to do is perform financially and commercially. That is an appalling indictment. That is unacceptable. It is a measure of the kind of approach that TVNZ will not just take as a result of this bill but is already taking. It is already taking that approach.

We had a concert in the park in Christchurch last November to raise funds for the city after the first quake. Who did the broadcasting for that? It was TV3. I commend TV3 for doing that. But where was the State broadcaster? We have now had two major events, two major fundraising events, that have been televised to the nation—in fact, televised even more broadly than to the nation, because Māori Television will be doing a global telethon—and who did the broadcasting for those events? The first time around it was TV3, and the second time around it is to be Māori Television. Where is TVNZ? Where is our State broadcaster? Why should TVNZ not be doing it, because that has been its role and function before this bill? This legislation strips TVNZ of any requirement, any compunction, any sense of responsibility, and any connection to the communities it is supposed to be serving.

TVNZ is supposed to be a public service. What more important public service could we expect to see than a broadcaster stepping up to the plate and helping the beleaguered community of Christchurch, which has had a $30 billion impact from two earthquakes? Why should we not ask the State broadcaster to roll out its stars, bring them on board, and give some hope and a signal to the community of Christchurch that our State broadcaster is behind us? Who are we referring to? We are referring to Māori Television. Thank goodness for Māori Television.

Hon Dr JONATHAN COLEMAN (Minister of Broadcasting): I will address a few points that the member Brendon Burns made. He talked about some vast conspiracy theory whereby the Government has a sweetheart deal with MediaWorks. Well, clearly this man does not watch TV3 news each night, because if we have a sweetheart deal for some sort of editorial control over MediaWorks, then, frankly, we are not getting our side of the deal! I must say I think MediaWorks does an excellent job of impartially reporting the news. The Opposition’s conspiracy theory is to try to make out there is some sort of sweetheart deal between the Government and MediaWorks. The fact is these Opposition guys are way off the ball, way off the play. When we put forward the deferred payment scheme for radio frequencies, which was open to all radio broadcasters, Steven Joyce issued a press release—I think it was last October—but these guys missed it completely. It was out there publicly; it has never been any secret. MediaWorks is paying 11.5 percent under the deferred payment scheme, which was open to anyone. These guys are so slow and so backward that they had to wait until John Drinnan wrote about it 8 or 9 months later before these guys, who are so bereft of ideas, even picked up on it.

Mr Burns talked about broadcasting regulation, and said it was very bad that we cancelled the broadcasting review. Frankly, it was redundant. He neglected to say the last Government sat on that review for months and months. It did nothing about it because it did not want to do anything about it. Labour Government members knew there would be a binary outcome—they would either win or lose the 2008 election—and they did not want the political baggage of progressing that report before the election. They knew how unpopular it would be with broadcasters and the public, so they thought they would do nothing. They knew they would probably lose the 2008 election, which they duly did. Then when the National Government cancelled what the Labour Government had never had the guts to push through, those members got upset and said that National had pandered to the broadcasters. Well, if they had really believed in it, they would have pushed it through.

Another point I will make concerns Mr Burns wanting a public broadcaster. Television New Zealand costs about $300 million, give or take a few tens of millions of dollars, to run each year. It has been 93 percent commercially funded for many, many years. This removal of the charter recognises that reality. It sounds as if Labour will find $300 million of public money to fund a fully public, non-commercial State broadcaster, because that is the alternative to what we have proposed. But, once again, all that Labour will do is attack. It will not put up anything that would be constructive.

Frankly, the attack on Māori Television in Mr Burns’ speech was just ridiculous. When special events are proposed, NZ On Air money is available, and the broadcasters all compete for access to that money. Māori Television has done an excellent job. It has done a great job on things like Anzac Day programmes. It has put its best foot forward and it has won the contract for that. We really do need to have a bit of clarity about what has actually gone on there. We have a very honest policy on this issue. TVNZ has always been commercial. Why should we not be honest about it and remove the charter? That is what we are doing.

The other thing I will address is the misinformation about meetings with boards over the last year or so. I have not been to nine MediaWorks board meetings. I have been to more than two Radio New Zealand board meetings in my time as Minister. I have met with the TVNZ board so many times that I cannot even remember how many times I have met with its members. We meet people right across the spectrum. I am in regular contact with board chairs and chief executives of all the major public broadcasters covered by my portfolio, and to suggest that any sort of sweetheart deal has gone on for MediaWorks is absolutely the sort of wild conspiracy theory that Labour members pursue and pursue in the hope that it will get traction with the public. I can tell the Committee that the voters out there in New Zealand—the voters in Northcote and Glenfield, the area I represent—are interested in law and order, hospitals, and the economy, not the mumbo-jumbo these guys are spouting or anything they have laid out here today. It will not get any traction with anyone, because at the end of the day, in terms of television, people want just to be able to see what they want, when they want to see it. They do not care what channel it is on. This policy here makes sure that the content is available for the people of New Zealand.

KRIS FAAFOI (Labour—Mana): Thank you very much for the opportunity to speak to Part 1 of the Television New Zealand Amendment Bill. The institution we are talking about here is very dear to my heart, because I spent the majority of my journalism career at Television New Zealand. But I am very concerned about what this bill, and the functions and purpose of this bill, will do to that public broadcaster. A lot of mostly loyal, mostly very experienced, and very talented staff are working at Television New Zealand, which outputs some of the best public broadcasting in the world. That broadcaster is one of the best. If we travel around the word and look at some of the examples of public broadcasting, we will notice that some of New Zealand’s television, born and bred right here in New Zealand, is some of the best. Television New Zealand takes great pride in the quality and the production values of what it puts on air. Its programming is world class.

I myself worked in a news organisation for nearly 10 years. If members have travelled around the world they will know that if they go to any major newsroom around the world there will be someone from Television New Zealand in a very senior position. Why is that? It is because of the public broadcasting remit Television New Zealand has had for years and years. Any major international broadcaster will have a Television New Zealand person working in its newsroom and calling the shots, because they are experienced, they care about quality journalism, they care about the quality of their output—not just the journalism but also the production values—and they have standards and skills that are among some of the best in the world. They are some of the best in the world. Those standards and skills have come about from a long tradition of quality public broadcasting. But this Television New Zealand Amendment Bill puts all of that at risk. It puts all of that long history at risk.

Hon Hekia Parata: How?

KRIS FAAFOI: Yes, it does. I can speak from experience; it puts all of that at risk, because the standards of journalism that the New Zealand public have come to expect over decades will be gone in an instant. What will we have? National members ask how. What will happen when people tune into Television New Zealand’s One News at 6 o’clock? They will be tuning in, and the most important thing about that hour for Television New Zealand will not be the news coverage, it will be the ads in between, because there will be a commercial imperative in relation to the news. We will get a dumbing down of news quality and news content, because the only thing Television New Zealand will care about is making money. The only thing Television New Zealand will be worried about will be making money. It is in black and white right there in the purpose of the Act. Clause 4 of the bill states that the purpose of the Act is to “(a) provide for the functions of TVNZ, the Crown entity responsible for conducting a television and digital media business; and (b) ensure that TVNZ carries out its functions and maintains its commercial performance;”. “Commercial performance”—that is all this is about. My very good friend Peseta Sam Lotu-Iiga said if I were still working there, I would get paid more. Well, it is not all about the money, I tell Sam. It is not all about the money.

While we are at it, it is not all about commercialism; it is also about the part Television New Zealand plays in the Pacific. Sam Lotu-Iiga knows very well that Television New Zealand’s One News, the 6 o’clock news, is a big rater in Samoa. Television New Zealand’s One News plays a very important function in making sure journalists are trained in and around the Pacific Rim. All of that will be gone because that does not make us any money, does it? That does not make us any money, so let us stop doing it. The quality of journalism around the Pacific will fall, and I think that, as a Pacific Island member of this Parliament, Sam Lotu-Iiga should be very worried about that.

This bill changes Television New Zealand from a public broadcaster to a commercial broadcaster, pure and simple. So all of a sudden it is about the money, and the substance of the stories starts to suffer. I can speak from experience, because investigative journalism takes time, it takes experience, and it takes research. Investigative journalism in New Zealand is very important, as the Hon Rodney Hide will know. It is very important to make sure one can dig to the bottom of issues, especially around this sphere. Digging to the bottom of issues exposes issues of national significance. But that will be gone, too, because that does not make money. That costs money; it does not make money. So the commercial imperative will come over the top, and all of a sudden investigative journalism at Television New Zealand will be gone. Under this regime, news coverage will be more about, as I said, the ads in between the stories, which will decrease in quality.

Hon Georgina te Heuheu: That’s what we get anyway, Kris.

KRIS FAAFOI: So Georgina te Heuheu does not like the quality of TVNZ news now? Georgina te Heuheu would rather watch the ads.

PAUL QUINN (National): I move, That the question be now put.

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

Ayes 66

New Zealand National 58; ACT New Zealand 5; Māori Party 2; United Future 1.

Noes 53

New Zealand Labour 41; Green Party 9; Progressive 1; Independents: Carter C, Harawira.

Motion agreed to.

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

Ayes 64

New Zealand National 58; ACT New Zealand 5; United Future 1.

Noes 55

New Zealand Labour 41; Green Party 9; Māori Party 2; Progressive 1; Independents: Carter C, Harawira.

Part 1 agreed to.

Part 2 Repeals and related amendments

The CHAIRPERSON (Eric Roy): We move now to Part 2, clauses 12 to 14. I say to members that we have had the philosophical debate. I ask members to debate clauses 12 to 14.

CLARE CURRAN (Labour—Dunedin South): There has been quite a lot of philosophical discussion. There has been a lot of heated discussion, and I think we have seen in this debate some fundamentally different philosophical positions on the Television New Zealand Amendment Bill reflected in the Committee. Some fundamentally important positions go to the heart of what public broadcasting is in New Zealand: the content of public broadcasting, the content of broadcasting, and how people receive it.

In Part 2 of this bill we see the discussion about the rescreening of television programmes produced prior to 1989. We are seeing a claim that it is in the public interest that the programmes be seen again. I refer again to the concept of public interest, because it is a critical concept and it shows the differences between the major parties and the philosophical, fundamental divide we have on these issues.

Although Television New Zealand has now launched its Heartland channel, which screens programmes from our past, it is exclusively for Sky to screen heritage programming. We are seeing, and we have heard today from the Minister in the chair, the Minister of Broadcasting, the future for broadcasting in this country. The important programmes that reflect our culture and past and what goes to the heart of what and who we are will end up in locked-up content that people have to pay to see. That is a critical, fundamental issue and I think we need to have a debate about it.

An estimated 2 million households in New Zealand do not get Sky. That is quite a lot of households, when one thinks about it; it is about half. The ones who do pay for it—

The CHAIRPERSON (Eric Roy): There are three clauses in Part 2: “Spent sections of principal Act repealed”, “Amendment to Copyright Act 1994”, and a clause regarding access to archives. That is what we are debating.

CLARE CURRAN: I raise a point of order, Mr Chairperson. I am talking about the archived works and the ability to see them on television. I think it is quite clear that that is what I am talking about.

The CHAIRPERSON (Eric Roy): I will hear the member.

CLARE CURRAN: I refer again to public interest. When those heritage programmes were made we were all paying licence fees for public television. The public had already paid for the production of those programmes through their fees and taxes. Those programmes are owned by the public of New Zealand, and they should be seen by the public of New Zealand, not just some of the public of New Zealand through a pay television channel. That is one of the key issues we are addressing in the bill with regard to the viewing of archived works and how they are seen by the public.

I note the comments of the member from the Greens, Sue Kedgley. She talked about the future that we are looking at as a country, in terms of how we will view content. She talked about the ultimate plan that this Government has for us to see content, and about whether it is archive content, which is covered under Part 2 of the bill, or whether it will cover more than the archived works and will end up being most of our content.

The other point I will make, because it is important, is that most of the content that New Zealanders will end up watching will come from overseas. Less content will be produced here, because the television channels are driven by commercial imperatives—particularly Television New Zealand, which is being required to return a particular dividend to the Government—and have to find programmes they can get a commercial return on. Therefore, the quality programmes that reflect the distinctive Kiwi sense of humour—the Fred Daggs, the Lynnes of Tawa, the David McPhails—

SUE KEDGLEY (Green): I will particularly focus on the new section 57A, “Making archived works available for public viewing”, which is to be inserted in the Copyright Act by clause 14. I will pick up from where Clare Curran left off. It is fantastic that some of the wonderful programmes made by Television New Zealand will be made available for public viewing.

I worked at Television New Zealand myself and made a number of programmes over a number of years, and I worked there in the days when it genuinely was public service television. Then we had commercials on some days, then they were allowed every day except for Sunday, and then slowly we went into full commercialisation. But I had the privilege of working there when it was genuinely a public service broadcaster. Fantastic programmes were made then that New Zealanders would dearly love to see.

But will New Zealanders see these wonderful archived materials on Television One or TV2? No, they will not, because from now on the sole criterion for whether Television New Zealand will screen a programme on Television One and TV2 will be the ratings. It will be how many ratings and what advertisements programmes will attract. Television One and TV2 will not screen these wonderful programmes, because they will not rate like some of those blockbusters from America. The reason only 17 percent of the content on TV2 is New Zealand content is that, quite frankly, it is a lot cheaper to import blockbusters from America, those action programmes, than it is to make New Zealand programmes. That is why we will see fewer and fewer New Zealand programmes on Television One and TV2. These channels will basically become not only commercial television but also foreign television. We will have two New Zealand - owned channels—that is, until such time as the Government sells them—screening commercial, foreign content.

What we will not see on Television One and TV2 is the wonderful archival material that was made at a time when Television New Zealand was able to focus on the public interest and when Television New Zealand was able to make major current affairs programmes, such as Brian Edwards’ programmes. For many years the whole nation sat watching these current affairs programmes, and they were influencing the debate in New Zealand. Where are the in-depth current affairs programmes on Television New Zealand? Well, sure, we have Close Up, but the constant mantra of Close Up is: “I am sorry, we have run out of time.” The current affairs issues of the day are all dealt with in 2-minute—or 5-minute, if they are later—segments, and people are constantly having to wring their hands and say that they are sorry as they have run out of time.

Unfortunately, the wonderful archival material that would show us what public service television can be like and what it is like—the wonderful documentaries—will not be shown. When I worked at Television New Zealand, there was a whole documentary department that did nothing but make fantastic documentaries, like Pioneer Women. Wonderful archival material is sitting there in the Television New Zealand archives and it will never be screened on Television New Zealand, because Television New Zealand has no public service obligation. It now exists solely to make money for the shareholder. It will screen programmes only if they can maximise advertising revenue, so the whole point of having these wonderful archive materials and of allowing their copyright to be waived so that they can be screened on television is missed, unfortunately. It is ironic, but in the same bill is the reason why those programmes will not be shown on Television One or TV2, the publicly owned television channels. Those channels will now be solely commercial and they will be worried that those programmes will not rate.

BRENDON BURNS (Labour—Christchurch Central): I started my career as a young broadcast journalist with what was still the NZBC and I also remember—

Progress reported.

Report adopted.

The House adjourned at 5.55 p.m.