Tuesday, 5 July 2011

Tuesday, 5 July 2011

Tuesday, 5 July 2011

Mr Speaker took the Chair at 2 p.m.

Karakia.

Questions for Oral Answer

Questions to Ministers

Pay Equity—Gender Gap

1. CATHERINE DELAHUNTY (Green) to the Prime Minister: Does he stand by his statement about equal pay for women: “The law at the moment actually provides quite clearly that it’s against the law to discriminate on the basis of gender”?

Rt Hon JOHN KEY (Prime Minister): Yes, it is prohibited under the Human Rights Act 1993, the Employment Relations Act 2000, and the Equal Pay Act 1972.

Catherine Delahunty: How can a woman take a successful case under the Equal Pay Act without information about rates of pay by gender in her workplace?

Rt Hon JOHN KEY: I am not in a position to advise an individual person when they take a case before the courts, but I am sure they are in a position to gather information by looking at other employment in the same area.

Catherine Delahunty: How can the current law be enforced when employers such as the Bank of New Zealand have refused to release salary data to those who are concerned about gender pay discrimination?

Rt Hon JOHN KEY: I am not responsible for the BNZ’s policies.

Catherine Delahunty: Is it not the case that it is very difficult for a woman to find out whether she is being paid less than a man who does the same job, because there is currently no requirement for employers to disclose that information?

Rt Hon JOHN KEY: For privacy reasons it is not generally possible for any person, irrelevant of their gender, to find out why somebody earns more or less than they do. There are a number of reasons why there is a gender pay gap in New Zealand, which currently sits at 10.6 percent. I should say that at one level New Zealand is to be congratulated because, at least in terms of the gender pay gap, ours is the third-lowest in the OECD.

Catherine Delahunty: Will he consider adopting the Green Party’s Equal Pay Amendment Bill, which requires employers to report on gender pay rates in their workplaces and release aggregated information on gender pay to employees on request; if not, why not?

Rt Hon JOHN KEY: As the bill has not been drawn from the ballot, we have not yet had an opportunity to consider it as a caucus. But I say to the member that there is probably more chance of Happy Feet having a holiday in Honolulu than there is of her bill ever being drawn, because the Labour Party is filibustering its entire parliamentary time to stop the Education (Freedom of Association) Amendment Bill.

Mr SPEAKER: Members have had their bit of fun. We will have some order.

Catherine Delahunty: What is his Government’s plan to reduce the gender pay gap and ensure the Equal Pay Act is enforced, apart from more research?

Rt Hon JOHN KEY: I am glad the member asked that question. She will be aware that in 2009 the Government put $2 million into the Ministry of Women’s Affairs. The ministry is doing a number of things, which include conducting research on what employers can do to encourage more women into trades and what works to encourage more women into trades; setting up women in trades networks in Wellington and Auckland; making the case for flexible work within the accountancy sector; conducting research on career choice in the secondary school years, and how this has changed over time—

Catherine Delahunty: I raise a point of order, Mr Speaker. I very specifically asked the Prime Minister what the Government was doing, other than research, on the specific matter of the gender pay gap.

Mr SPEAKER: I think the Prime Minister did outline a range of issues. It was not just research that the Prime Minister outlined.

Catherine Delahunty: I raise a point of order, Mr Speaker. He outlined a range of issues to do with women in unfamiliar trades, and with research. He did not talk about the gender pay gap, in any shape or form.

Mr SPEAKER: The member has a further supplementary question. I cannot judge the quality of an answer. It seemed to me that the Prime Minister did answer the question. The member has a further supplementary question in which to pursue the detail of that answer.

Rt Hon JOHN KEY: I raise a point of order, Mr Speaker. Sorry, I have not finished the answer. There is a lot more that the Government—

Mr SPEAKER: I think the Prime Minister outlined quite sufficient initiatives.

Catherine Delahunty: Is his comment that he “hoped people were not being paid differently because of their gender” an example of the political leadership women are looking for on this issue?

Rt Hon JOHN KEY: No, it reflects the fact that I hope employers follow the law, as prescribed under the Human Rights Act 1993, the Employment Relations Act 2000, and the Equal Pay Act 1972. I go back to the comment I made earlier that although the gender pay gap sits at 10.6 percent, it is the third-lowest in the OECD. There are a number of contributing factors to why that might be the case, but one of them is that the labour market in New Zealand is highly segregated. About half of all men and women work in occupations where at least 70 percent of workers are of the same gender, so a comparison across the entire workplace provides a misleading number from time to time.

Carol Beaumont: What concerns does the Prime Minister have about the gender pay gap of 27.5 percent in the Department of the Prime Minister and Cabinet at June 2010, as reported by the Equal Employment Opportunities Commissioner, Dr Judy McGregor?

Rt Hon JOHN KEY: We would have to look closely at it. The issue there may be, as it is in a lot of workplaces, that because different people are doing different jobs, it is not an issue of gender; it is an issue of the jobs they perform.

Catherine Delahunty: I seek leave to table a letter from the Bank of New Zealand to the finance sector union, refusing to release salary data, from 19 October 2010.

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.

Catherine Delahunty: I seek leave to introduce my Equal Pay Amendment Bill to the House, given that it is claimed it—

Mr SPEAKER: Leave is sought for that course of action. Is there any objection? There is objection.

State-owned Assets, Sales—Purpose

2. Hon PHIL GOFF (Leader of the Opposition) to the Prime Minister: Is his proposal to sell shares in public assets like power companies an essential part of his plan to pay off debt and aid economic recovery; if not, what is it intended to do?

Rt Hon JOHN KEY (Prime Minister): Extending the mixed-ownership model, which was pioneered by the previous Government in respect of Air New Zealand, has a number of objectives. They are to free up capital on behalf of taxpayers to fund public assets like schools and hospitals and growth-promoting investments such as infrastructure and broadband; to broaden the pool of investments for New Zealand savers; to sharpen commercial disciplines, increase transparency, and provide greater external oversight of the companies involved, which we still own a majority of; and to provide opportunities for those companies to obtain more capital in order to grow.

Hon Phil Goff: Is page 28 of the Budget Policy Statement 2011 correct when it states that even after partial privatisation of the public’s most valuable commercial assets—the power companies—net Crown debt in New Zealand will rise from 14.1 percent last year to 28.5 percent in 2015, meaning that under his policies net Crown debt doubles even though he has partially privatised the most valuable commercial assets?

Rt Hon JOHN KEY: Yes, and the reason for that is that, amongst other things, Budget 2011 includes a $5.5 billion provision for Christchurch. So that is to bail out the people of Christchurch. What we do know is that if Labour were in Government, debt would be a lot higher than that—that is, unless it introduced its land tax, or its capital gains tax, or its financial markets tax, all of which would crush everyday New Zealanders. I look forward to campaigning against those things. [Interruption]

Mr SPEAKER: The House will come to order. I blame myself; I missed that totally. We will not have any more interjections. The honourable Leader of the Opposition will ask his supplementary question. [Interruption] Before the Leader of the Opposition has even started to ask his question there is a barrage from the National Party members. It will cease.

Hon Phil Goff: Is the failure of his Government to curb that rise in debt over the next 5 years—the doubling of Crown debt—one of the reasons that 40 industry leaders interviewed by Jenni McManus said of his Government in last Saturday’s Dominion Post that they had no confidence that the National Government had an economic strategy or vision, and that it had squandered its opportunity to improve New Zealand’s economy?

Rt Hon JOHN KEY: No. The increase in debt reflects, first, the barrage of policies we actually inherited from Labour that were unfunded, uncosted, unrealistic, and unworkable. It is a little bit like the research and development credit that Labour went out there telling people would cost $800 million, when we all know that it would cost $1.55 billion and would just add more to debt. We do have a plan. The Government is more than happy to table the plan once more. It is called the Budget and it does not include a financial markets tax, a capital gains tax, or a land tax.

Mr SPEAKER: I worry that it is turning into a contest to see who can make the most noise. Question time is not about that. [Interruption] There will not be interjections while I am on my feet. Members know that. I will get serious about that, very soon.

Hon Phil Goff: Were the Labour policies that the Prime Minister just talked about the same Labour policies that he promised sincerely before the election he would not change, like “We will not be increasing GST.”, “We won’t change the threshold for KiwiSaver.”, and “We won’t cut KiwiSaver or Working for Families.”; if they are those same policies, why did he promise before the election not to change them, then he dishonours that promise now?

Rt Hon JOHN KEY: It may be lost on the Leader of the Opposition that we are having an election on 26 November, but it is not lost on the Government. The Government will be campaigning on any changes included in Budget 2011. We look forward to having that debate with the public, because I would much rather go to the country with our policies than with a land tax that will see house prices falling, a capital gains tax that will see New Zealanders fleeing for other countries, and a financial markets tax, which is just a tax on spending, and which last time I looked was a tax very similar to GST.

Hon Jim Anderton: To the Prime Minister—

Mr SPEAKER: I will have some courtesy now. I cannot hear the Hon Jim Anderton. I must be able to hear his question.

Hon Jim Anderton: If selling $19.1 billion of State assets between 1988 and 1999 did not fix the list of unmet needs in the New Zealand economy, which he read out to the House today, why would selling what is left be likely to fix them?

Rt Hon JOHN KEY: The member actually raises a good point: what is the purpose behind this policy? The answer is to give New Zealanders assets that they can invest in, as opposed to the 64 failed finance companies, which emerged under the watch of a Labour Government—when Labour was in office—that that member was a Minister in.

Hon Jim Anderton: What is the principle that the Prime Minister is enunciating to the House and to the country today about selling assets back to the same people who own them now?

Rt Hon JOHN KEY: We want to buy more assets, and the only proposition that that party has is to borrow more money, put more New Zealanders in hock, and give New Zealanders fewer opportunities to invest. I for one want to grow the assets in New Zealand, and the invest opportunities for New Zealand, and make New Zealand a more productive country. What I do not want is a capital gains tax, a land—

Mr SPEAKER: The question was from the Progressive party. The party policies of the Labour Party are irrelevant to that question.

Hon Phil Goff: Was Mr Ryall correct when, speaking to the Finance and Expenditure Committee the week before last, he asserted that the Government had no way of preventing the on-selling of individual shares to foreign corporates—that is, the shares that the Prime Minister is intending to privatise?

Rt Hon JOHN KEY: I suspect that the Leader of the Opposition is taking the Minister’s words out of context. For one reason, if Mr Ryall had been asked the full question, he would have said—and probably did say—that majority control is being held by the Government. He may well have read out the Treasury advice that says that widespread and substantial New Zealand ownership is achievable. He probably would have also noted that New Zealand mums and dads will be at the front of the queue, as will the 1.7 million KiwiSaver accounts, as will the Crown financial institutions. That is why New Zealanders will own those assets.

Hon Phil Goff: Was that Treasury advice the same Treasury advice that I have got in my hand, entitled “Crown ownership of commercial entities”, which says on page 30 that partial privatisation will lead to possible cornerstone stakes by energy multinationals in the State-owned enterprises—that is, it will not be the mums and dads; it will be the big, foreign multinationals that own a cornerstone share?

Rt Hon JOHN KEY: The Government has made it quite clear: Kiwi mums and dads are at the front of the queue—not trade sales. But if we wanted to do some trade sales, we would go to the Leader of the Opposition and ask him for advice, because he flogged them off from one end of the globe to the other when he was a Minister in the previous Labour Government.

Hon John Boscawen: What does he think will do more to help pay off debt and aid the economic recovery: the partial sale of power companies, or scrapping the emissions trading scheme—another of the barrage of policies he inherited from the Labour Government?

Rt Hon JOHN KEY: It is quite obvious that that would be the partial sale of assets, because if one looks at the partial sale of assets, one sees that it will generate in the order of $5 billion to $7 billion, if not more. The emissions trading scheme is a net scheme of about $300 million per year.

Hon Phil Goff: Does the Prime Minister accept that assets like the power companies belong to New Zealanders and that they are not his Government’s to sell; if so, why is he privatising shares in those assets when, two to one, New Zealanders say they are against it? Is that sheer arrogance?

Rt Hon JOHN KEY: We are having an election on 26 November. That will be the opportunity for New Zealanders to vote on the policies. Arrogance would be to take a position where one passes the law and carries it out without reference to the New Zealand public. We are having reference to the New Zealand public and they can make a choice. They can vote for a capital gains tax, a land tax, or a financial transactions tax, or they can vote to buy a few shares in companies that I know they want to buy a few shares in.

Infrastructure Investment—National Infrastructure Plan

3. AMY ADAMS (National—Selwyn) to the Minister for Infrastructure: What progress is the Government making with its multi-billion dollar infrastructure programme?

Hon BILL ENGLISH (Minister for Infrastructure): More good news. Yesterday we issued—

Mr SPEAKER: Before I invite the Minister to continue, I say to the National backbench that that kind of pathetic behaviour will not continue or someone will be leaving the House. I am deadly serious about it. It is pathetic, in this House, to cheer when a Minister starts an answer like that. A good answer can be applauded, but that was just pathetic.

Hon BILL ENGLISH: More good news. Yesterday we issued the second National Infrastructure Plan, which shows the Government will invest over $17 billion in building productive infrastructure over the next 4 years, and that is excluding the $5.5 billion set aside for Canterbury. It will see the Government investing $7.6 billion in social assets like schools, hospitals, State houses, and prisons; $6.5 billion in roads; and $1.5 billion each in broadband and rail, and doing it all with no new taxes.

Amy Adams: What are the main challenges identified by the National Infrastructure Plan?

Hon BILL ENGLISH: The plan shows that our infrastructure is generally improving, with less red tape and more investment in roading, rail, telecommunications, electricity networks, and specific projects for the Rugby World Cup. The challenges include the rebuilding of Canterbury, managing the taxpayers’ large asset base—currently $220 billion—better, and ensuring that future investment goes into areas that deliver the greatest benefits to the economy.

Amy Adams: What are the Government’s infrastructure priorities for the next 3 years as set out in the National Infrastructure Plan?

Hon BILL ENGLISH: I will say that this is the first time that the Government has set out clear priorities covering the period of the next 5 to 10 years: firstly, building Canterbury infrastructure; secondly, a comprehensive approach to investment in Auckland; thirdly, improving the management of the Government’s social infrastructure such as schools, hospitals, and State housing; fourthly, focusing transport investment on supporting export-led growth; and, finally, improving the Government’s ability to monitor the performance of all infrastructure.

Amy Adams: What has been the focus of the Government’s infrastructure programme since the election in 2008?

Hon BILL ENGLISH: The Government moved immediately with a multibillion-dollar programme to unclog our economic arteries by boosting investment in productive infrastructure. We have invested, in the last three Budgets, heavily in schools—the biggest ever education capital programme—and in ultra-fast broadband, which sits alongside record investment in the electricity and State highway networks. As well as that, we have worked on improving the consenting process so that large projects can get through in a matter of months rather than several years.

Child Poverty Reduction—Priority

4. Hon ANNETTE KING (Deputy Leader—Labour) to the Prime Minister: Does he stand by his statement that “I am prepared to commit Government resources to try to lift children out of poverty”; if so, what priority has he put on the eradication of child poverty in New Zealand?

Rt Hon JOHN KEY (Prime Minister): Yes. In this year’s zero Budget the Government prioritised funding increases to health and education, in part because we recognise the fundamental role these public services play in lifting children out of poverty.

Hon Annette King: If he has done much to reduce child poverty in New Zealand, what is his response to the recently appointed Children’s Commissioner—Dr Russell Wills, a passionate advocate for children—who said at the weekend: “I don’t think it’s OK that we live in a country where children arrive at school because of their poverty … without having their basic needs met.”

Rt Hon JOHN KEY: I agree with him.

Hon Annette King: Did he see the report at the weekend that said that among the 34 countries in the OECD, New Zealand has one of the highest rates of child poverty and one of the lowest levels of investment in the first 5 years of life; if so, why has his Government increased child poverty, not decreased it?

Rt Hon JOHN KEY: No, I did not see the report. But I am pleased that despite its being a zero Budget, the Government put in $44 million extra to support children in State care. That was just one of the many steps the Government took in Budget 2011.

Hon Annette King: If he thinks his Government has done much to reduce child poverty, why did he and the Minister of Finance reject the policy proposal supporting the protection and well-being of our most vulnerable children, as revealed by the release of the Budget documents by Treasury last week?

Rt Hon JOHN KEY: I would have to look at the specific piece the member is talking about. What the Government did in the Budget was come up with a number of additional spending items and a number of additional programmes to help our most vulnerable young New Zealanders. That included the $44 million package I spoke of, it included increasing the levels of child immunisation, it included participation of the most needy kids in early childhood education, it included more money going into Whānau Ora, and it included an increase in performance in the education system. Of course, the Government has highlighted the fact that it wants to reform the welfare system.

Hon Annette King: Does he think that Dr Wills may know a little bit more about child poverty and what is happening in New Zealand than the Prime Minister, in light of his comments that the bulk of kids that he sees as out-patients are from the most poor and vulnerable families; if not, why not?

Rt Hon JOHN KEY: I accept that Dr Wills is a specialist. That is why the Government appointed him.

Clare Curran: I seek leave to table a poster made by the children and teachers of St Clair Community Kindergarten protesting the changes to early childhood education—

Mr SPEAKER: We are not going to table posters. The member will take that down. The member does not have the call and cannot use visual aids when she does not have the call. We do not table posters that are prepared for a political purpose, no matter how good they might be.

Schools, Rural—Ultra-fast Broadband

5. CHRIS AUCHINVOLE (National—West Coast - Tasman) to the Minister of Education: What recent milestones have been reached in connecting rural schools to ultra-fast broadband?

Hon ANNE TOLLEY (Minister of Education): Last week I visited Te Kura o Ōmaio, which is on the east coast of the Bay of Plenty, as part of an event to mark the first three rural schools in New Zealand being connected to ultra-fast broadband. Here we connected via the internet with my colleagues the Hon Steven Joyce at Henderson Valley School, west of Auckland, and Chris Auchinvole, who was at Granity School on the West Coast. It was a fantastic opportunity for these children to meet with other students around the country and to ensure that they have the same opportunities as those who live in urban areas. This is the first step in connecting our rural schools to ultra-fast broadband; 748 rural schools will be connected directly to fibre.

Chris Auchinvole: How did the schools use the ultra-fast broadband in the classroom?

Hon ANNE TOLLEY: When I visited Te Kura o Ōmaio the children connected live with the other two schools. They started with an astronomy lesson, and then went on to learn and talk about Matariki. It was absolutely great to watch the students from all three of those schools interacting with one another and talking and learning from each other. They were also identifying huge opportunities. In fact, the students at Ōmaio told me they want to learn Spanish, and they are investigating linking up with some schools in Spain to help them with that. This is a huge leap forward for these schools and provides the tools for much-improved learning in the 21st century.

Question No. 2 to Minister

Hon PHIL GOFF (Leader of the Opposition): I raise a point of order, Mr Speaker. I am sorry to interrupt the next question but I seek leave of the House to table the uncorrected transcript of the 2011-12 estimates for Vote Finance (State Owned Enterprises), where Mr Ryall said one could not guarantee, on issues of sale, that the shares would not be onsold to foreign investors.

Mr SPEAKER: A point of order is being heard and it will be dealt with in silence. I am just receiving a little advice on this matter; it is somewhat unusual. Leave is sought for that document to be tabled. Is there any objection? There is objection. [Interruption] Do those members want their colleague to be able to ask his question? The Hon David Cunliffe, question No. 6.

Hon SIMON POWER (Acting Leader of the House): I raise a point of order, Mr Speaker. I apologise to the Hon David Cunliffe, but I want to be clear about what just occurred. I understood that the Leader of the Opposition was seeking to table an uncorrected transcript of a select committee, which presumably belongs to the select committee until such time as the details of that transcript have been confirmed by the select committee, at which point that transcript would become available for the more public matter that has just occurred.

Hon Trevor Mallard: Speaking to the point of order.

Mr SPEAKER: I do not think I need help. I will come back to the member if I get this wrong. It is my understanding that the transcript related to hearings in public, and therefore the information is public anyway. What was said is actually in the public domain anyway. Were it a report of the committee, were it a transcript of a hearing when the committee was in session, not in public, that would be a totally different situation. That was why I sought advice on the matter before seeking leave of the House—to make sure that it was appropriate to seek the leave of the House. In the event, the House chose not to give leave, and that is absolutely the House’s prerogative. But, in my understanding, there was nothing wrong in leave being sought, because it was a transcript of a public hearing and what was said was already in the public domain.

Hon Simon Power: Speaking briefly to that point of order.

Mr SPEAKER: I will hear the Acting Leader of the House briefly, indeed.

Hon SIMON POWER (Acting Leader of the House): I raise a point of order, Mr Speaker. It is just so that we are clear about this from this point on. What I am concerned about is that although the matter described by the Leader of the Opposition may have occurred in public, as to the transcript recording that matter it is for the committee to determine its accuracy as to what occurred when that matter was heard in public. The Leader of the Opposition sought to table that unapproved and draft transcript, regardless of whether or not, in fact, that matter had been heard in public. It is a transcript that belongs to the committee, regardless of how the information came to be in the hands of the committee—whether it was public, or not. It has not been confirmed by the committee, and now we have a situation where a member is seeking to table a transcript uncertified, if you like, or not agreed to, by that committee. That is quite different from a version of what occurred in public being made available to the House. This is a matter that belongs to the committee, regardless of how that evidence was heard.

Hon TREVOR MALLARD (Labour—Hutt South): I think that, as all members are aware, these transcripts are verbatim transcripts, but it could just as easily be a recording made by any member of the committee or any other person there; there could have been a request for those to be tabled, as well. I think people need to look at the history of this. There was an assertion made in question time—

Mr SPEAKER: No, no. This is not relevant to the point of order.

Hon TREVOR MALLARD: Well, I think that members on this side have been looking for ways to correct misrepresentations in supplementary answers—

Mr SPEAKER: No. We are starting to get away from the point of order. It is an interesting issue that I will seek further advice on, because the honourable Acting Leader of the House has put forward an interesting argument. In my view, there is nothing that prevents leave being sought to table this particular document. The House has made a decision not to grant that leave, on the basis that it believes that it is the committee’s right to deal with a transcript. I think that was the basis—

Hon Trevor Mallard: The House doesn’t believe; one member does.

Mr SPEAKER: Well, the House made the decision, under our Standing Orders, because leave was denied. But because of the interesting situation in relation to transcripts—and I know that it is normal practice for select committees to approve the release of a transcript—I want to have a look at that before I make any definitive ruling about whether this should be an acceptable practice. I think that no harm has been done today, because leave was not granted, and I will certainly seek further advice on the appropriateness of leave being sought. It is an interesting issue. I hear what the Hon Trevor Mallard, the shadow Leader of the House, said—that it is in public, and what would be wrong with leave being sought for an electronic record that had been taken to be tabled in the House. Yet the honourable Acting Leader of the House makes the point that transcripts normally are dealt with by a committee prior to their release. I want to have a look at how those issues can be properly resolved. I will hear the honourable Acting Leader of the House further.

Hon SIMON POWER (Acting Leader of the House): I do not mean to delay the House, but Standing Order 236 may assist. Paragraph (1) states: “A report or a draft of the report of a select committee or a subcommittee is strictly confidential to the committee until it reports to the House.” Standing Order 236(2) goes on to state: “Paragraph (1) does not prevent—(a) the disclosure, by the committee or by a member of the committee, of a report or a draft report to a member of Parliament or to the Clerk or another officer of the House in the course of their duties:”. I urge you to consider that Standing Order as part of your deliberations, Mr Speaker.

Hon Trevor Mallard: Mr Speaker—

Mr SPEAKER: No, I do not think I need further help, and I am not going to take up further time right now. All I will say to the honourable member is that a transcript is not a report. I think that Standing Order is intended to cover actual reports of committees, and a transcript, I would argue, is not a report. But I think it is an interesting issue that has arisen, and I will take some time to look at it. Should there be any difficulties around the Standing Order, around this issue, the Standing Orders Committee is meeting at the moment and the matter can be considered there, as well. I do not wish to impede the opportunity of the House to deal with these matters in a way that the House sees appropriate. Today I put the leave as a member had sought leave, and it was declined. I think today no harm has been done, but I will certainly look at the matter further.

State-owned Assets, Sales—Ownership of Shares

6. Hon DAVID CUNLIFFE (Labour—New Lynn) to the Minister of Finance: Does he agree with the analysis by Brian Gaynor in the New Zealand Herald in 1999 that foreign buyers during the asset sales of the late 80s and 90s enjoyed a return of more than $13 billion in the first 12 years following the sales, and would he be happy for similar large profits to once again be lost overseas under the current Government’s asset sales policy?

Hon BILL ENGLISH (Minister of Finance): No, and no, and that is why the Government is doing it differently from Labour in the late 1980s.

Hon David Cunliffe: What measures in his privatisation policy would ensure that the shares sold by the Government would not end up in foreign hands, as they did with Contact Energy and the BNZ, given that Treasury has found “significant participation by foreign investors would be essential …”?

Hon BILL ENGLISH: As we have said many times in this Parliament, the Government disagrees with the advice. New Zealanders will be at the front of the queue. The New Zealand Government will retain 51 percent. Even in the case of Contact Energy, which was sold down over 10 years ago, a significant proportion of those who initially bought the shares are still on the register, 14 years later. New Zealand shareholders are loyal to New Zealand companies.

Hon David Cunliffe: Is he concerned that his privatisation policy would see energy company boards answerable to foreign shareholders who care about maximising their profits, not the overall economic health of New Zealand?

Hon BILL ENGLISH: No, because the majority shareholder will be the New Zealand Government. Among the other shareholders will be the New Zealand Superannuation Fund, ACC, 1.7 million KiwiSavers, and Kiwi mums and dads. I think Labour members are trying to cover up for the faults in the programme that Labour put together back in the 1980s. We are trying to learn from their lessons. They put the Air New Zealand model together 5 or 6 years ago. Air New Zealand has worked under mixed ownership, and these companies would work under mixed ownership as well.

Hon David Cunliffe: Further to the Minister’s answers, what advice has he received about the rights of minority shareholders, especially substantial minority shareholders, including the right to compensation for lost opportunities or the right to require a majority shareholder to increase their equity or else face a dilution of their shareholding?

Hon BILL ENGLISH: I have not received any detailed information on that, but the advice I do have is that if the Government is a 51 percent shareholder, then it has more rights than all the other shareholders put together. Of course, the Government would exercise those rights.

Hon Sir Roger Douglas: Does he agree that Telecom was sold in 1990 for $4.25 billion, which in real terms is $2 billion more than its recent market capital value, and does this show that Government ownership of assets is not the economic utopia that Labour makes out, when risks involved are taken into account?

Hon BILL ENGLISH: That is a good point. People who buy into any commercial company have to face commercial risk. In fact, the value of Telecom was $16 billion in 1999, and today it is less than $5 billion. Whether the Government owned those shares or private investors owned them does not change the risks of operating in the communications market.

Hon David Cunliffe: In light of his previous answer, which essentially condones asset stripping by the buyers of State-owned enterprises, is he aware that a State-owned enterprise is legally required to exhibit a sense of social responsibility by having regard to the interests of its community in which it operates and to be a good employer, but if energy companies were removed from the State-Owned Enterprises Act, under privatisation, their boards would be legally required to act only in the best interests of the company, regardless of the consequences for the country as a whole?

Hon BILL ENGLISH: If we are talking about asset stripping and price gouging and energy companies, it would have been under the Labour Government when energy prices went up 70 percent in 9 years. Labour sold down billions of dollars worth of assets from those State-owned enterprises and took the cash.

Hon Sir Roger Douglas: In light of his answer about the sale of Telecom, does the Minister believe that the then Deputy Prime Minister took these risks into account when Telecom was sold in 1990 by the Government, and are these risks part of the reason behind the Government policy to partially sell some assets?

Hon BILL ENGLISH: It is a fact of history that the Deputy Prime Minister at the time was the Rt Hon Helen Clark, who oversaw the sale, and at her right hand was the Hon Phil Goff. A lot of people will not vote for Labour until it apologises for the actions it took then.

Mr SPEAKER: I am unhappy about that, because the question came from the ACT Party and was used to attack Labour. That is not, in my view, a very fair situation. To make up for it I have added one question to Labour’s supplementary questions today.

Hon BILL ENGLISH: I raise a point of order, Mr Speaker. The primary question was an unusual one, I might say, but we should look at it. It referred to an analysis by Brian Gaynor in the New Zealand Herald in 1999—

Mr SPEAKER: I do not need to have a debate on this matter. The Minister will resume his seat. I took the nature of the primary question into account during a number of the answers given. Considerable criticism was made of Labour in the Minister’s answers, and I accept that as being perfectly reasonable given the primary question. That was taken into account. But the ACT Party asked a question that did not really require Labour to be attacked, and I did not think the Minister’s answer was reasonable. The Minister answered it perfectly properly at the start. He did not need to go on to that last attack. It caused disorder in the House, and to discourage that kind of thing I have awarded Labour a further supplementary question.

Hon BILL ENGLISH: I raise a point of order, Mr Speaker. The first point is that if you give me a point of order, then generally the practice has been that the member is allowed to finish their point of order, even if the Speaker wants to rule on it in a way that the member does not agree with.

Mr SPEAKER: Let me be very clear on this: that is not the way I operate, at all. If I do not, as Speaker, hear within a few seconds what the issue of order is—

Hon Parekura Horomia: He’s trifling with you.

Mr SPEAKER: I accept absolutely that that was not the honourable shadow Leader of the House. But if I do not hear within a few seconds what the issue of order is, I sit members down. I have even asked the Prime Minister to sit down, and I am absolutely even-handed on that point. I will not have issues debated by way of point of order. I have made it very clear in relation to this question that I considered that the primary question had some provocation in it. It sought opinion and had some provocation. I gave the Minister a lot of licence in how he answered that question. There was nothing wrong with the third party’s question, and the Minister answered it perfectly well for a start, but he then deviated into attacking Labour, which was where I became unhappy, because attacking Labour was not essential to the answering of the question from the Hon Sir Roger Douglas. The easiest way to me to discourage that kind of answer seems to be to give Labour a further question.

Hon Rodney Hide: I raise a point of order, Mr Speaker.

Hon Parekura Horomia: Who’s this?

Mr SPEAKER: Order!

Hon Rodney Hide: I ask you to reflect on this. I am not challenging your ruling, but I am thinking about it going forward. This is a debating chamber and members are here to debate. It is natural that they debate policies—

Mr SPEAKER: The member will resume his seat, as well. This is actually question time, I tell the Hon Rodney Hide; this is not a debate. The rules for question time are very clear. It is not a time when we have debates. We have questions asked, hopefully, and answers given. That is enough. I have simply decided to give Labour a further question, but I will say to some of the front bench on my left—not the shadow Leader of the House, but some of his colleagues—that when points of order are being heard, they will not interject.

Hon David Cunliffe: Given that the Budget documents and the Investment Statement attached to it show only a $200 million write-down in dividends but project a $6.8 billion sale price, which implies a 3 percent return on assets, can the Minister explain why private shareholders would want to buy shares in electricity companies for a 3 percent return on assets and not push up power prices higher than they have currently been?

Hon BILL ENGLISH: Almost anything will be an improvement on how these assets were run up to 2008, when electricity prices were pushed up by 70 percent in 9 years, but the companies paid minimal dividends, equivalent to a 2 to 3 percent return. So if members want to see a track record of very high power prices and low returns, they will see them in relation to these assets under the Labour Government.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. Although it was long, that was a relatively simple and clear question that went to why people would buy something for a 3 percent return if they were not going to put up the prices. It was a forward-looking question, not one that looked backward. There was no attempt to address it.

Mr SPEAKER: In fairness, I do not think it is possible to tie Ministers to answer exactly the way that members may wish them to answer. The question asked about dividends and prices, and in answering the Minister went back over a bit of recent history around dividends and prices. I listened very carefully to hear whether the Minister overstepped the mark in my view in terms of attacking the questioner. I do not believe he did. I think the answer to the question was not unreasonable. It may not have been what the questioner wanted, but it was still not an unreasonable answer in my view.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. I do want to litigate. The question was about dividends and prices going forward. The reply was all about dividends and prices going back. It could not—

Mr SPEAKER: Often a way to understand how prices and dividends may behave in the future is to look at the way they have behaved in the past. It is not unreasonable in answering an economic question like that to look at what the history has been in the recent past to better understand how things might be in the future—[Interruption] The member will not interject while I am on my feet.

Roading, Auckland—Western Ring Route Progress

7. NIKKI KAYE (National—Auckland Central) to the Minister of Transport: What progress has been made on the Western Ring Route Road of National Significance?

Hon STEVEN JOYCE (Minister of Transport): I am pleased to report to the House that a giant step towards a fully functioning western ring route was taken today as the board of inquiry assessing the Waterview Connection project released its final decision, granting resource consents for the approximately $1.4 billion project. The Waterview Connection is crucial to completing the western ring route road of national significance. Other components are well under way or complete. The Hobsonville deviation and Brigham Creek extension project will be opened in the next few months, well ahead of schedule. Once completed, the western ring route will provide a 48-kilometre alternative to State Highway 1 around Auckland. It will help to ease congestion across the city, and it will improve travel times for both freight and people.

Nikki Kaye: What are the benefits of the new consenting process for local communities and the Government?

Hon STEVEN JOYCE: This is the first roading project to use the new national consenting process, and the board of inquiry took just over 9 months to reach a final decision. During this process, local concerns have been heard and mitigation measures included, such as moving the location of the vent stacks and providing additional open space. Now that the consent and the mitigation measures have been finalised, I understand that the New Zealand Transport Agency will be in a position to appoint a lead contractor, with construction starting later this year. This quick progress has saved up to a year in construction time, as well as offering significant cost savings.

David Shearer: Given that the Waterview Connection generates benefits of up to $2 for every $1 spent on its construction, will the Minister now review plans for the “Holiday Highway” north of Auckland, which will deliver only 80c for every $1 spent on its construction, particularly in light of rebuilding demands in Christchurch?

Hon STEVEN JOYCE: The member’s numbers are incorrect. I think that project has a 1.1 benefit-cost ratio at 8 percent, and better at 6 percent. Certainly the Pūhoi to Wellsford road is acknowledged as crucial for the development of the whole Northland region. Of course, if the member wants to play benefit-cost ratios, I look forward to his view on the central business district rail tunnel, which currently has a benefit-cost ratio on the same measurement of 0.3 or 0.4.

New Zealand Trade and Enterprise—China Beachhead Advisory Board

8. Hon DAVID PARKER (Labour) to the Acting Minister for Economic Development: Did the New Zealand Trade and Enterprise Beachheads advisory board in China resign en masse the week before last; if so, for what reasons?

Hon DAVID CARTER (Acting Minister for Economic Development): Yes; differences of opinion developed over quite a period of time between the beachhead advisory board and New Zealand Trade and Enterprise, and it was agreed that the best way forward was to start with a clean slate.

Hon David Parker: Did the Minister read the prior warnings in newspaper or other reports quoting David Mahon, the then chair of the beachhead board, criticising New Zealand’s failure to pursue opportunities under the free-trade agreement with China, in which he said “Trade agreements that are not followed by integrated, commercial strategies are the most empty of political marriages. New Zealand’s free trade agreement, signed with China in 2008, is one such unconsummated marriage.”?

Hon DAVID CARTER: I did read those comments, and I certainly do not agree with them.

Hon David Parker: Why should New Zealanders have any confidence in the Government’s handling of trade and investment opportunities with China, given that the mass resignation of the private sector participants in the Beachheads programme for China is a vote of no confidence by those most closely involved?

Hon DAVID CARTER: I am quite happy to tell the member why we should have confidence in the work of New Zealand exporters and of New Zealand Trade and Enterprise. China has become New Zealand’s second-largest trading partner since 2008. We have observed a 140 percent increase in the amount of trade with that country. That is the fastest rate of growth in the history of New Zealand and of New Zealand Trade and Enterprise.

Hon David Parker: Does the Minister intend to replace the private sector beachhead board, or is this just another area where the Government has no adequate plan to support the growth of the New Zealand economy?

Hon DAVID CARTER: The Beachheads programme is but one suite of mechanisms used by New Zealand Trade and Enterprise. It is absolutely an operational matter as to how the advisory board’s relationship with New Zealand Trade and Enterprise is managed, and it is over to New Zealand Trade and Enterprise to decide whether to replace the board. The figures speak for themselves. When we can talk about a 140 percent increase in trade over 3 years, for the member to suggest that New Zealand is not trading satisfactorily with China is just a plain nonsense.

Hon Maryan Street: What damage has been done to New Zealand’s reputation with our second-largest trading partner by the complete collapse of this well-known and defective beachhead board in the wake of the Government’s intervention?

Hon DAVID CARTER: I do not believe any damage has been done, which will be a disappointment to the Labour Party.

Hon Maryan Street: What does the Minister intend to do to restore any damage to New Zealand’s reputation in China after this very patent debacle?

Hon DAVID CARTER: I do not believe any damage has been done to the New Zealand reputation in China at all. What the member needs to realise is that the Beachheads programme dealt with 12 New Zealand companies working in China; New Zealand Trade and Enterprise works with 183 companies quite successfully, as the trade figures demonstrate.

Children, State Care—Home for Life Numbers

9. TIM MACINDOE (National—Hamilton West) to the Minister for Social Development and Employment: How many foster children now have a “Home for Life”?

Hon PAULA BENNETT (Minister for Social Development and Employment): Since I launched the Home for Life programme in October last year, a total of 329 children have found permanent, stable homes with New Zealand families. In fact, permanency is the best thing we can give those children.

Tim Macindoe: What support is available for families under the Home for Life programme?

Hon PAULA BENNETT: Every caregiver who offers a child a home for life is entitled to reasonable legal costs; a $2,500 upfront payment, paid after the Home for Life orders are granted; a baby starter pack for children under 2; and access to a national foster care training programme. They get to determine how much a social worker is involved in their lives and in their family, and I think that has been really well received.

Rahui Katene: What responsibility does the Government take to ensure that kin care, families, and whānau with a direct genealogical link to the child are promoted as the first option in any care arrangements concerning children?

Hon PAULA BENNETT: Child, Youth and Family takes the responsibility to try to find suitable family and whānau first and utmost as its main priority for these children. As at the end of June, 75 percent of those homes were with family or whānau—that is, 248 children since October. For Māori that figure is even higher, with 85 percent going into permanent placements with whānau.

Housing—Access to Appropriate and Affordable Housing

10. MOANA MACKEY (Labour) to the Minister of Housing: Does he believe all New Zealanders should have access to appropriate and affordable housing?

Hon PHIL HEATLEY (Minister of Housing): Yes, and the overwhelming majority of New Zealanders are able to source and sustain their own housing arrangements. For those who need additional support, we are committed to helping them. Budget 2011 contained $1.85 billion for 350,000 households who are provided with the income-related rent subsidy in State houses or the accommodation supplement for those in private rentals and those with mortgages. This is an increase of $444 million, or 32 percent, above the Labour Government’s 2008 Budget.

Moana Mackey: Is he confident that there is enough appropriate and affordable accommodation available for the 5,000 people who have been told they are no longer eligible for a Housing New Zealand Corporation home, and for the many thousands more who will have their tenancies terminated if National wins the election?

Hon PHIL HEATLEY: All people who were on the waiting list, from A through to D, on 1 July are still eligible for a State house—we gave them that certainty. It is those who come on to the housing needs register from 1 July and who are C and D applicants who will not be eligible for a State house. I think the member should get her facts right before promoting such scaremongering.

Moana Mackey: Why is he taking a one-size-fits-all, punitive approach that will achieve nothing other than cause major uncertainty for every family in State housing, instead of letting Housing New Zealand Corporation continue to work with tenants on a case by case basis and move people on when appropriate, given that the actual problem is a lack of affordable housing options and not fictitious millionaire Housing New Zealand Corporation tenants?

Hon PHIL HEATLEY: The problem is that historically no Government has moved anyone on from State houses. That is why we have cases where one person is living in a four-bedroom house, where five or six people in a family are living in a garage—particularly during the previous Labour Government—and where some people in State houses earn $80,000, $90,000, or $100,000 a year while others struggle on the waiting list. We will address that problem. We will be housing the people most in need.

Moana Mackey: When will his Government reveal any kind of plan to deal with the actual reasons that families cannot access appropriate and affordable housing, which are a stagnant economy, rising unemployment, massive cost of living increases, and a desperate ever-worsening shortage of housing supply, which has driven up rents in the private sector, instead of scapegoating poor and struggling families and blaming them for the fact that they cannot find somewhere to live?

Hon PHIL HEATLEY: I have publicly and clearly laid out National’s plan in housing. I have not heard a thing from the Labour Party. Where is its plan?

Arts Funding, New Plymouth—Len Lye Centre

11. JONATHAN YOUNG (National—New Plymouth) to the Minister for Arts, Culture and Heritage: What recent announcements has the Government made about supporting the arts in New Plymouth?

Hon CHRISTOPHER FINLAYSON (Minister for Arts, Culture and Heritage): I recently announced a grant of $4 million over 2 years toward the construction of a Len Lye Centre to be built adjacent to the Govett-Brewster Art Gallery. It will provide a permanent and accessible home for the Len Lye collection and archive, which the Govett-Brewster Art Gallery has held since 1980. It will make the works of one of our most important artists accessible all year round to New Zealanders and foreign visitors. I acknowledge the outstanding work of New Plymouth MP Jonathan Young in advocating for the city’s interests.

Jonathan Young: How will the grant support the people and community of New Plymouth?

Hon CHRISTOPHER FINLAYSON: The centre’s design, by award-winning firm Pattersons, will provide the city with new built heritage to further enhance it as a tourism destination.

Hon Annette King: Marginal seat retention scheme.

Hon CHRISTOPHER FINLAYSON: Well, Harry was very happy. An independent study projected that the economic benefits to New Plymouth will be an extra $6.8 million a year and the creation of the equivalent of 138 full-time jobs. It is a fantastic development, and it may perhaps provide an incentive for Andrew Little to spend a few nights in New Plymouth one day.

Question No. 12 to Minister

Hon TREVOR MALLARD (Labour—Hutt South): I seek leave for this question to be set down for tomorrow as the Prime Minister has clearly stepped out. The Prime Minister was here, and it is a question on employment—

Mr SPEAKER: Leave is sought—

Hon TREVOR MALLARD: —which we regard as very important.

Mr SPEAKER: The member should not have added that bit. He is seeking leave to have this question deferred. Is there any objection to that? There is objection.

Job Creation—Prime Minister’s Statement

12. JACINDA ARDERN (Labour) to the Prime Minister: Does he stand by his statement that “Our strategy for job creation is to build the economic conditions that will give businesses the confidence they need to hire new workers”?

Hon BILL ENGLISH (Deputy Prime Minister) on behalf of the Prime Minister: Yes.

Jacinda Ardern: Does he believe that his Government is doing everything it can to create and keep Kiwi jobs when last month 40 workers at Hillside railway workshops were told they were being laid off because KiwiRail chose a Chinese bidder for a significant contract?

Hon BILL ENGLISH: We are certainly endeavouring to do everything we can. To put that particular business in perspective, in the average 3-month period something like 120,000 jobs disappear and about 130,000 jobs appear, so there is a very high turnover in the New Zealand labour market. We want to make sure, in particular, that people enter the labour market with good skills out of the education system, and that businesses can see that it will be profitable for them to employ more people in New Zealand. The good news is that confidence is rising and employment is rising.

Jacinda Ardern: Is he confident his Budget’s job creation policies are working, given that since 19 May over 1,000 New Zealand workers have been made redundant and a record 3,300 Kiwis have left for Australia and better opportunities?

Hon BILL ENGLISH: We do have confidence in the measures laid out in the Budget. The Budget forecasts, for the next 4 years, 170,000 new jobs, which will be a return to the rate of job creation that this economy enjoyed from 1990 to 2005, when about 35,000 new jobs, on average, were created every year.

Jacinda Ardern: What role did economic conditions play in the loss of 304 jobs at Ovation New Zealand’s boning facility in Waipukurau, and are these the same economic conditions that he believes will create 170,000 jobs?

Hon BILL ENGLISH: Regardless of the economic cycle, industries go through change. The sheep industry has gone through a fairly significant contraction, and around that industry we would expect that because of reduced lamb numbers there will be reduced processing capacity. Our challenge is to make sure that for those skilled workers there are good opportunities, in growing industries, for them to pick up jobs where they can get good pay and a prospect that their incomes will increase. So we are focusing on helping to create the new jobs.

Bills

New Zealand Security Intelligence Service Amendment Bill

Crimes Amendment Bill (No 3)

Third Readings

Hon CHRISTOPHER FINLAYSON (Attorney-General) on behalf of the Minister in charge of the NZ Security Intelligence Service: I move, That the New Zealand Security Intelligence Service Amendment Bill and the Crimes Amendment Bill (No 3) be now read a third time. This legislation makes select changes to the powers of the New Zealand Security Intelligence Service. In particular, it modernises those parts of the warrant framework that have not kept pace with technology, as the principal Act’s warrant framework is now over 30 years old. That framework was designed at a time when the principal methods of communication were by mail, landline telephone, or facsimile. Although the core surveillance powers contained in the warrant framework have remained relevant, new ways of communicating mean that those powers do not, in all respects, marry up with modern communication methods. Changes must therefore be made to enable the Security Intelligence Service to regain its full functionality before New Zealand hosts an important event like the Rugby World Cup. Changes to the warrant powers will ensure that the Security Intelligence Service is equipped to deal with the now widespread use of computer, mobile phone, and internet technologies, and to take advantage of new surveillance technologies available to it. The legislation also clarifies the protections from liability for persons acting under warrants, and provides for delegation powers.

In the Committee of the whole House the original bill was divided into two bills by Supplementary Order Paper 248, to reflect the need to amend the Crimes Act in respect of computer offences. The two bills are therefore the New Zealand Security Intelligence Service Amendment Bill and the Crimes Amendment Bill (No 3). The New Zealand Security Intelligence Service Amendment Bill achieves five changes: it adds a specific reference to electronic tracking in the warrant framework, it amends the subject of warrants to include cyber-identities, it removes the requirement to amend a warrant every time a new person is requested to assist under a warrant, it provides a proper suite of delegation powers, and, finally, it ensures that sufficient protections are in place for those who execute warrants. The Crimes Amendment Bill (No 3) removes an existing barrier to the use of modern surveillance methods as they relate to or affect computers.

These are important changes to the Security Intelligence Service’s powers. They are necessary to enable the Security Intelligence Service to keep up with new ways of communicating. They will improve its functionality in the modern age, and make sure that it is ready for the Rugby World Cup.

Whenever surveillance powers are updated, care must be taken to retain the very delicate balance between the right to privacy and the need to use surveillance in maintaining the security of the State. That balance is achieved by ensuring that powers extend only as far as can be justified, and by maintaining a strong system of checks and balances on the exercise of those powers. First, intrusive surveillance powers can be exercised by the Security Intelligence Service only under warrant, and warrants must be approved by the Prime Minister in every case, together with the approval of the Commissioner of Security Warrants, who must be a retired High Court judge in the case of domestic warrants. Perhaps it is appropriate here to place on record the excellent service of retired High Court Judge Sir John Jeffries in the work that he does. The other pillar to the system of checks and balances is the independent oversight achieved through the Office of the Inspector-General of Intelligence and Security. In particular, he or she has a statutory duty to review the execution of warrants. In this role he or she has access to all information held by the Security Intelligence Service.

The Security Intelligence Service is also subject to oversight bodies in respect of its general functions. The Intelligence and Security Committee oversees policy, expenditure, and administration. The Privacy Commissioner and the Chief Ombudsman retain important oversight roles in respect of information requests, and the Controller and Auditor-General reviews all expenditure.

I commend the work of the Intelligence and Security Committee on this bill. The committee is comprised of the leaders of the National Party, the Māori Party, the ACT Party, the Labour Party, and the Green Party. It worked in a constructive and considered way to improve the bill, and I thank the members of the committee for their contribution. The committee added additional safeguards to the legislation following the hearing of submitters’ concerns. The principal addition was the reference to human rights in the principal Act, requiring the Security Intelligence Service to perform its functions in accordance with a comprehensive set of principles. The committee also added other safeguards, including ensuring that mistaken identities are not tracked, requiring any irrelevant tracking records to be destroyed, and maintaining a register of delegations in respect of those persons who execute warrants. They sufficiently bolster existing protections in the principal Act.

The process of amending the principal Act has led to additional safeguards being introduced. The select committee recommended adding a set of principles to guide the operation of the Security Intelligence Service. Other safeguards recommended by the select committee included ensuring that mistaken identities are not tracked, and, together with the package of what has been proposed, they provide what I believe are adequate protections in the principal Act.

These bills achieve the necessary and, as I said, delicate balance between the two principles of national security and privacy. I commend both bills to the House.

Hon DAVID PARKER (Labour): I rise to support the third readings of the New Zealand Security Intelligence Service Amendment Bill and its allied bill, the Crimes Amendment Bill (No 3). The Labour Party will be supporting both of these bills.

I will talk briefly about the balance that we try to strike in this Parliament between the rights of the individual and the rights of the community. This legislation strikes at the intersection of those competing interests. We all know that in New Zealand we try to protect against the inappropriate erosion of our civil liberties. Those civil liberties include the right to go about our business without intrusion by the State, or arms of the State, except where that is strictly necessary. Exceptions are made in various areas of the law. For example, if there is an allegation of some form of criminal activity, then an arm of the State has the right to apply to the court for various ways of intervening through a warrant process, so that people who are being investigated for crimes can have their affairs looked at a bit more closely. That involves an intrusion of the State, and whenever there is a suggestion that the rights of the State to intrude on private lives should be extended in some way, appropriate scrutiny is made by various arms of civil society. The media, the Law Society, civil liberty groups, and private individuals, to name but a few, all stand up and say that we should look at these things pretty seriously before we confer additional rights.

The problem that we have regarding the process that has been adopted in respect of the legislation we are now considering is that it was not as open as it could have been. I am informed that if one looks at the history of the Security Intelligence Service legislation, one would see that the last time the Act was amended there was a commitment to openness of process by the then Government under the leadership of the then Prime Minister, the Rt Hon Jenny Shipley, who ensured that to the extent possible, submissions on the bill could be heard in public. If any part of those submissions was sensitive and people thought that it should be secret, then they could apply to the committee and that particular part of the submission could, if the committee thought it appropriate, be heard in secret.

In respect of this legislation the Government chose a different course. It chose the opposite course. It actually said that instead of having a presumption that this should be done openly, it decided in advance that all submissions should be heard in secret. That is an issue that the Labour Party, together with other parties, including the Greens, has been critical of, because there was no need for that secrecy in a general sense, and that level of secrecy means that people are less well informed and more suspicious of what we are doing in Parliament than would otherwise be the case.

I have no doubt that most of the submissions that were heard by the select committee could have been heard in public. If they were heard in public, submitters could have heard what other submitters were saying to the select committee. Members of the fourth estate would have been able to listen to some of the things that were said by submitters. Submitters would have greater confidence in that process and also members of the fourth estate would be readily able to discern for themselves who was tilting at windmills and what concerns were real and should have real attention paid to them by the select committee.

However, because of the process that the Government, under the Rt Hon John Key, chose in this instance, there was no opportunity to have those submissions heard in public. As a consequence, the standard of debate we have had in civil society on the New Zealand Security Intelligence Service Amendment Bill is worse than it would otherwise have been. I think that is lamentable. Notwithstanding the fact that Labour supports this legislation as being a fair update of the powers of the Security Intelligence Service, I put on record again that I think the process was poor, that we have on a number of occasions in this Parliament seen poor process on the part of the National Government, and that it undermines public confidence in the institutions that we ought to be doing more to maintain public confidence in.

In respect of the merits of the changes that are made, the main changes have been well summarised by the Attorney-General. I will not go through all of the points that he made. Suffice it to say that in the main this legislation updates the suite of technologies that can be utilised by the Security Intelligence Service. Whenever there is an extension to those powers, we should be rightly suspicious in this Parliament that we are not conferring unnecessarily broad powers, and therefore unnecessarily intruding into the private lives of New Zealanders or creating some arm of the State that has inappropriate powers.

We also need to have regard to the fact that some technologies were not thought of when the original legislation was first passed. There are instances where the Security Intelligence Service might be able to exercise unregulated powers without the sorts of controls that we have through this legislation, and we uncovered that when the Justice and Electoral Committee looked at police powers of search and surveillance earlier in the year. We discovered that far from necessarily increasing the power of the police in all cases, in some cases we were regulating what were then unregulated powers, because those powers were not even covered by the original legislation.

I for one take considerable heart that we have checks and balances on the conduct by the Security Intelligence Service of its duties, through oversight by the Prime Minister, who has to sign off on warrants—

Charles Chauvel: Only domestic warrants.

Hon DAVID PARKER: On domestic warrants—thank you, Mr Chauvel. Perhaps, more important, the commissioner, who oversees warrants, is by law required to be a former High Court judge. In this regard I am happy to stand on record and say that I am very proud of the fact that in New Zealand we have a long tradition of a non-corrupt judiciary. Our High Court and upper courts are as good as any in the world. We have no history of corruption in our higher courts of which I am aware, and we have only the very occasional incident of misconduct in lower courts. Indeed, I would think that in respect of having a non-corrupt judiciary, there is no better example of that anywhere in the world than our system.

Therefore, when we appoint a former High Court judge to oversee what is happening in the Security Intelligence Service, we can be confident that we are appointing someone of integrity who will go about their duties responsibly, with a view to protecting the traditions that we hold dear in New Zealand. Those traditions are that we do not have a Security Intelligence Service that overreaches its mandate and turns into an organisation that spies on New Zealanders in a way that is not appropriate.

The other point that I will reinforce, and that the Attorney-General also made reference to, concerns the principles that have been inserted into the New Zealand Security Intelligence Service Amendment Bill. The principles were inserted into the legislation at the suggestion of, amongst others, the Chief Human Rights Commissioner, who suggested that the legislation make it clear that when the Security Intelligence Service performs its functions under the Act, it “(a) contributes to keeping New Zealand society secure, independent, and free and democratic: (b) contributes to the participation of New Zealand in the maintenance of international security: (c) acts—(i) in accordance with New Zealand law and all human rights standards recognised by New Zealand law, except to the extent that they are, in relation to national security, modified by an enactment: (ii) in the discharge of its operational functions, independently and impartially:”—therefore, it cannot become an arm of political purpose, if you like—“(iii) with integrity and professionalism: (iv) in a manner that facilitates effective democratic oversight.”

Perhaps that last point is quite an important one in that if those who are responsible for oversight were concerned that they could not effectively oversee its operations, then they could have regard to the purpose and principle sections; they would no doubt say to the Prime Minister that they had concerns, and through that we exercise control.

With the reservations as to process that I have already enunciated, the Labour Party supports both of these bills.

CHARLES CHAUVEL (Labour): I will follow the shadow Attorney-General’s remarks by supporting the tenor of what he has just had to say. It was helpful to have the Attorney-General outline the legislation as it has come back to the House. It is regrettable on a matter of this import that it appears we will not have any more Government calls in the debate. None the less, I think it is appropriate to use the rare opportunity that we have to discuss in this Chamber security matters to express the qualified support that the Opposition brings to this third reading debate.

As has been said, the Labour Party has decided that it will support the amendment legislation. But just as the shadow Attorney-General entered a couple of reservations to that support, and, perhaps, looked forward to some ways in which we might do things differently in this area, I would like to expand on some of those thoughts. It is first of all a matter of real regret that the legislation had its first reading under urgency. There is too much resort to urgency in this term of this Parliament, and urgency is an abuse of the procedures that exist in the Standing Orders. They exist for a good reason; they exist because we do not have a second Chamber. All we have by way of reviewing what the executive brings into the House by way of legislation is the committee system—both the select committees and the Committee of the whole House.

If there is excessive resort to urgency, the danger is that those few safeguards that we have to properly scrutinise the laws that we are making are set aside. We should take all this a lot more seriously than we do. If we see further abuses of urgency, then we will also see a loss of confidence by the people in this place, and that is in the interests of nobody sitting anywhere in this Chamber.

I think what ought to be signalled first off is that certainly for my part, and, I think, for a number of my colleagues, it is appropriate to start thinking about ways in which we can better entrench the Standing Orders so that it is much harder to have resort to urgency, particularly where urgency involves the avoidance of committee procedure, or circumscribing the committee procedure, so that we cannot do our job—the job the public expect of us—which is to have a look at the content of legislation in a proper fashion.

The second reservation that needs to be expressed about the process concerning this legislation is that the committee hearings as far as the Intelligence and Security Committee was concerned were essentially, at the behest of the Government, heard behind closed doors. I want to echo exactly what David Parker said on this point. There is no need for secrecy to be a default procedure to be adopted in any committee of this House. There are sufficient provisions in the Standing Orders for evidence to be heard either in secret or in private so that any concerns about security or the identity of persons involved in the security apparatus or any other sensitive matter of national security can be adequately dealt with.

The fact that we did not have the opportunity to have those provisions used as they should have been during this process is lamentable. As David Parker says, that sort of process gives rise to what is no doubt unnecessary suspicion amongst the public that something is being done behind closed doors that ought to be being done with the disinfectant of sunlight instead. When we default to a private or a secret way of proceeding in the name of national security, we give rise to those fears and we feed them. We should not; we need not. There are, as I say, procedures in place to allow those matters to be sufficiently taken care of. Regard should have been given to them in this circumstance, and it was not.

Everybody on this side of the House concedes that the subject matter of this legislation is important. It involves a balancing act between the powers of the security agency to protect New Zealand interests on the one hand with the rights, particularly the human rights and the privacy interests, of those whom the service investigates and whom it protects. It is certainly obvious that the principal Act, given that it dates back to 1969—it is 42 years old—was enacted long before the advent of cellphones, the internet, portable devices, and social networking. So clearly there is a need to bring this sort of legislation constantly up to date to take account of modern technology.

It is obviously also important to have regard to the security environment in which we live. Another matter of regret I have is that it was thought necessary to rush through this legislation in time for the Rugby World Cup. We should not do that sort of thing. This sort of legislation is too important to make it contingent on passage by a particular date because of a particular event. It should contain enduring principles that represent getting that balance that I have just referred to right rather than saying we have to get this legislation through before the Rugby World Cup. That is just not appropriate. It is not a principled way to legislate on security matters.

The other thing that is appropriate to recall is that we are now 10 years on from the tragic events of 9/11. It is fair to say that, as a result of 10 years having passed, we can be more dispassionate about threats on the one hand and the civil liberties we are prepared to give up as a society on the other, in order to protect ourselves from those threats. Most people would acknowledge that in the shadow of those tragic events we were all much too willing to give up the civil liberties side of the ledger and not have proper regard to the balancing exercise that ought to have been taken. It is appropriate to take time after those sorts of events to think about the balance, and I wish there had been more time and a more open process by which that could have occurred in this situation.

The most important change to the bill that I want to commend to the House, which was made during the committee process and was one that I have already said I do not think was a perfect or ideal one, was the insertion of a series of working principles in the legislation by which the work of the Security Intelligence Service should be carried out. It is significant that those principles have been inserted and that they were inserted at the behest of the human rights watchdog in New Zealand, the Human Rights Commission. That is something to be pleased about.

The bill updates existing powers. For that reason it will receive support from members on this side. But it should be remembered that those powers are extensive. There is some oversight, as we have heard. There is the Intelligence and Security Committee itself; there is the requirement that warrants for domestic interception be granted jointly by the Prime Minister and the Commissioner of Security Warrants. We have had two very fine retired High Court judges serve in that capacity—Justice Neazor and Justice Jeffries. We should always be asking whether we have sufficient oversight. We have a combined agency here responsible for both domestic and foreign security matters. In Australia the Australian Security Intelligence Organisation is responsible only for the domestic side, and it is supervised by the Attorney-General in a nod to an attempt to get better oversight and better control by the rule of law into the process. We should clearly be thinking at all times about that balance to which I referred: our security on the one hand and our rights on the other. We should always be asking whether we get that balance right. For the reasons I have referred to, I am concerned that in this process we have not. We should always be mindful of the need to keep the principles by which we oversee security legislation relevant, not determine them by self-imposed deadlines relating to upcoming events. That is the wrong way to do it and I hope we have not legislated in haste here in order to regret at leisure.

KEITH LOCKE (Green): The Green Party believes that the New Zealand Security Intelligence Service Amendment Bill and the Crimes Amendment Bill (No. 3) are inappropriate and unnecessary legislation. The legislation is inappropriate because we should not be giving more surveillance powers to such an unaccountable Government agency with a history of using these powers to spy on critics of the Government. It is unnecessary because there is a review of the whole New Zealand Security Intelligence Service Act due next year, according to the papers that accompanied this amendment legislation. This review should be similar to other reviews of Government agencies—that is, the review should encompass not just the technicalities of legislation but also what the Security Intelligence Service is actually achieving, if anything; what overlaps there are in its functions with those of the police; what functions can be dispensed with; and whether the service should continue as a separate organisation.

In discussing or reviewing the SIS, let us first look at its security functions as outlined in the New Zealand Security Intelligence Service Act. The SIS is supposed to protect, as shown by the definition of “security” in section 2(1), “New Zealand from acts of espionage, sabotage, and subversion…”. “Espionage” is defined as the communication of information to foreigners with an intent to prejudice the security of New Zealand.

The reality is that no New Zealander would admit to that intent. New Zealanders are constantly conveying information to foreigners—we are a pretty open society with few real secrets, and we do not actually have any nations who are our enemies. The WikiLeaks documents show that Bruce Ferguson, who was our Chief of Defence Force, met with US Embassy officials expressing concern that New Zealand’s anti-nuclear policy was affecting relations with the United States. This probably prejudiced the security of New Zealand, as the Greens would look at it, but there was no intent to commit espionage. We hardly need an agency separate from the police to deal with espionage in this country. Sabotage also requires an intent, as defined, to prejudice the security of New Zealand, which may be hard to prove in court. In any case, sabotage, whatever its motivation, is surely a police matter rather than one for the SIS.

In addition to espionage and sabotage, the Act refers to subversion and provides a two-part definition. The first part of this definition relates to people attempting to overthrow the New Zealand Government, or encouraging this. This is hardly a problem we have in our stable parliamentary democracy. Nobody is organising a coup d’état these days. The second part of the definition of “subversion” in section 2 of the Act is “the undermining by unlawful means of the authority of the State in New Zealand:” This definition has been used to justify spying on protesters, such as during the anti-Apartheid Springbok Tour protests in 1981 when thousands of New Zealanders engaged in civil disobedience. Of course, the actions they engaged in at that time, which were technically unlawful according to the wording in the Act, are now hailed by most New Zealanders as a patriotic deed.

The Act also allows the SIS to spy on foreign-influenced activities that, under the definition of “security” in section 2(c)(ii), “are clandestine or deceptive,” and that (iii) “impact adversely on New Zealand’s international well-being or economic well-being:”. Which activities impact adversely is generally a matter of political debate. There is no clear right answer, although the Government’s view of what impacts adversely is generally the one that the SIS goes by. The Greens would argue, for example, that the Government’s negotiations for a free-trade and investment deal with the United States of America, which are being done somewhat clandestinely, thus fit the Act’s definition and are “adversely affecting New Zealand’s international and economic well-being”. It is well known that the SIS, in line with the Government’s definition of this type of negotiation, looks in the other direction, as in the 1996 raid on the home of anti - free trade and investment activist Aziz Choudry. The targets of SIS spying are never the Government or active supporters of its policies, but always its critics. That is what is so dangerous about the SIS. As members know, I have obtained the large SIS file on my political activities over the years, which were legal activities that politically challenged successive New Zealand Governments.

The final function of the SIS in protecting “security”, as defined in the New Zealand Security Intelligence Service Act, is to prevent terrorism but, again, surely that is predominantly a police function. Other Government departments, including the police, are subject to performance measures to work out whether we, as taxpayers, are getting value for money. Should we not ask what the SIS has achieved against what could be its performance measures? Has it detected any spies, saboteurs, terrorists, etc.? If it has not—and it appears that it has not—is there a strong case for either slimming down the SIS, as is happening at the moment to other Government departments where staffing levels are deemed excessive to needs, or perhaps getting rid of the SIS altogether and relying on the police to deal with all politically motivated crime? We know that the Police, not the SIS, was the agency that tracked down the French terrorists who bombed the Rainbow Warrior, and it was the police who tracked down the Mossad agents who were obtaining fraudulent New Zealand passports. The SIS has no similar successes to its name.

We could also apply performance measures to the thousands of security vets the SIS has done on civil servants. How much have these actually enhanced New Zealand’s security, or is there a greater downside? Could we find out how many civil servants have missed promotion simply because they have been deemed by the SIS to be too active against Government policy? We just do not know. That lack of knowledge of the upsides and downsides of SIS work is a major problem. The agency has such limited accountability mechanisms. There is only a part-time Inspector-General of Intelligence and Security, and Parliament’s Intelligence and Security Committee—a statutory committee, not a select committee—has not met very much to scrutinise SIS activities. It did, to its credit, spend a little bit of time on this bill, even if it did decide to hear the public’s submissions in secret—quite wrongly—and, to its credit, it actually came up with a few amendments. The Greens support the committee adding a human rights clause to this legislation, as recommended by the Human Rights Commission, but we wonder whether the SIS will actually take much notice of the clause.

Then there is the problem of the SIS’s subordination to overseas intelligence agencies, which has been a problem from day one in 1956, when the agency was set up primarily to assist British intelligence. Nowadays it probably takes most of its lead from US agencies. The WikiLeaks documents talk about the way in which the SIS has recently integrated its threats database with that of the American Government. There are obvious dangers there, because the US administration has a very broad definition of dangerous people, and it can extend that definition to its political opponents. The SIS subordination to foreign intelligence services was stark in the Ahmed Zaoui case, where a democratic critic of the Algerian Government was threatened with expulsion because, as the SIS admitted in its documentation, like-minded countries would be upset if he were allowed to settle here. In that, the intelligence agencies of France, which supported the Algerian dictatorship, were influencing the New Zealand Government.

That was not unusual. We now know from the Arab peoples’ uprisings of 2011 that the French, British, and American Governments have supported Arab dictatorships up to the last, really, because only when the Tunisian and Egyptian people were on the verge of victory did the Western powers change sides and give those people some support. Even now, the United States supports the ruthless Bahraini regime against the big people’s movement, and of course the factor there is the US Fifth Fleet being based in Bahrain.

The American Government’s view of the world reflected in its intelligence service is not one that our intelligence service should be adopting, but it seems to be doing so. The extra surveillance powers that the SIS has been granted in this bill, particularly the electronic interception powers, will to a significant degree be used to implement an agenda determined not by New Zealanders but by American intelligence agencies. The SIS’s partner agency, the Government Communications Security Bureau, is running a satellite spy station at Waihopai, mainly in the interests of the US National Security Agency. The SIS was set up as a Cold War instrument, with one bloc against another, but now that we do not have any enemy countries, there is not such a rationale for such a spy agency to continue to exist. We should leave security to the police. Thank you.

RAHUI KATENE (Māori Party—Te Tai Tonga): Tēnā koe, Mr Assistant Speaker Robertson. Tēnā koe e te Whare. Rau rangatira mā, tēnā koutou katoa. I stand on behalf of the Māori Party to take a brief call on the New Zealand Security Intelligence Service Amendment Bill and the Crimes Amendment Bill (No 3). These bills are yet more in a long line of legislation that is preparing us for the Rugby World Cup. The legislation proposes that in order to support effective security operations, we need to update the warrant framework to take into account the technological advances that have been made in the storage and communication of information. Law commissioner Dr Warren Young has apparently provided an independent analysis of the legislation, and was satisfied that the need for change was warranted, and that the amendments proposed in this legislation would provide the Security Intelligence Service with an opportunity to effectively undertake its statutory functions.

I have to say that, as a general principle, the Māori Party has had concerns in the past in relation to the operations of New Zealand’s surveillance machinery as it impacts on Māori. There are, of course, the as yet unresolved concerns about the Urewera raids. The SIS has stated that it was not involved. It appears to have been brought into the issue because of a briefing on the raids it gave the then Leader of the Opposition, John Key.

In that fateful period in October 2007 more than 300 police raided alleged military-style training camps in the rugged Urewera ranges, and homes in Auckland, Ruātoki, Palmerston North, and Wellington. Later that month the SIS issued a rare public statement to dispel speculation that it had been involved in the police operation that culminated in the arrest of 17 alleged activists. In that release Dr Warren Tucker, in his position as Director of Security, advised that the SIS had no powers to enforce security, such as arrest or detention, and concluded that the operations were a police matter. But in his release Dr Tucker did not address the issue of whether the SIS may have been involved in the year-long surveillance operation that led to the raids, so in Māori communities the question still remains unanswered.

Other concerns date from some 7 years ago, from a time around 2004 when there were allegations that the SIS had spied on members of the Māori Party and Māori organisations. An investigation by the Inspector-General of Intelligence and Security found that spying had not taken place. I make just a brief mention of this background, as I think it is timely to consider two other events that have occurred in the last 2 days that also have a bearing on this legislation. The first, of course, is the historic agreement signed with Ngāi Tūhoe at Mātaatua Marae in Ruatāhuna on Saturday. The signing signalled a landmark in the relationship between Tūhoe and the Government. I have to say it is humbling to see the generosity of spirit exhibited by a people who have endured such bitter twists and turns in their interactions with the Crown over the last century and more.

The second key event, of course, is the claim that has been described as the most significant claim in a generation, and that is Wai 262. Ko Aotearoa Tēnei is the Waitangi Tribunal’s report into that claim and it describes how key priorities in the preservation and transmission of Māori culture, identity, and knowledge should be shared between the Crown and Māori. I have to say that when it comes to the urgency accorded this legislation and any legislation paving the way for Rugby World Cup fever to take over our nation, I am saddened that this most significant report was not considered worthy of the same urgency. Twenty years between the claim being made and the claim actually coming to report status is way too long.

What better time than Māori Language Week to bring to the fore the place of Māori culture, identity, and traditional knowledge? In fact, Rugby World Cup 2011 provides an excellent opportunity to use Māori language knowledge as New Zealand showcases itself on the world stage. In keeping with the Māori Language Week theme of manaakitanga, this week provides us with an excellent opportunity to think about how we make people welcome when they are in our company and how we give regard to, and care for, others when hosting visitors. Manaakitanga is about keeping our visitors safe and secure, but also it is about extending the hand of welcome by sharing Māori culture as integral to national culture and identity.

We support the New Zealand Security Intelligence Service Amendment Bill and the Crimes Amendment Bill (No 3) at their third readings, and we look forward to the companion legislation promoting the status of mātauranga Māori into our national agenda.

DAVID SHEARER (Labour—Mt Albert): Thank you for the opportunity to speak on this legislation. As I said in the Committee stage, this legislation is extremely important. It balances the needs and the interests of the State with the interests and the freedoms that we take for granted in New Zealand—our individual and personal freedoms. I would like to comment in passing on Keith Locke’s contribution. There is no doubt that a lot of the security issues that we face in the world are very much seen through a political lens. They may not necessarily be security issues as such, but more of a political nature. I commend the Gwynne Dyer article in yesterday’s New Zealand Herald, where he looks at the various permutations that have taken place in the investigation of the killing of the Lebanese Prime Minister, Rafiq Hariri, which was first pinned on the Syrian regime and now has been put on Hezbollah. But the fact that the blame has moved is more about where international politics was standing at the time, rather than, as he points out, the real issue of blame and proof. It is something that we have to take considerable care in addressing when looking at the powers of our security agencies and the way that those powers are manifest here in New Zealand.

We are very lucky in New Zealand because we are geographically isolated. We do have, in a sense, that geographic security blanket, if you like, that comes from being at the bottom of the Pacific. It is more difficult to launch an attack on New Zealand, it is more forewarned, although I have to say that as cyber and internet threats increase, we cannot take that security for granted. A part of that security, and again Keith Locke touched on this as well, is the fact that we do not have, necessarily, natural enemies. We have been known for our rather independent stance in the world, and that has undoubtedly contributed to New Zealand’s security in the world.

I was struck by the comments about the recent role of the SAS in Afghanistan. Comments were made about the fact that when SAS soldiers walked out of the operation that they carried out with the Afghan Crisis Response Unit—and this drew criticism from the Prime Minister as well—photographs had been taken and published in our newspapers. The New Zealand Herald printed them. The television stations, on the other hand, chose to blank out the various soldiers’ faces. I think this is a little bit like looking at our role there after the horse has bolted, in a sense. We know, and everybody knows, that the New Zealand SAS are in Afghanistan. We know that they are training the Crisis Response Unit. We know they take an active role in operations. When they move around with a Kiwi emblem on their arms, we know that those people in uniform are New Zealand soldiers. So when we are taking a photograph of them coming out of an operation, it is a little bit late in the piece to say that we should blank out their faces because showing their faces could constitute some sort of security risk. Everybody in Kabul will know who those people are, and certainly every journalist and every photographer will know exactly who those people are. I can say that the Taleban are not worried about whether photographs are up on New Zealand television screens or whether the soldiers’ faces have been blanked out in the New Zealand Herald article, in terms of whether they will become a threat. We are somewhat naive in our portrayal of the way we try to protect our soldiers when we put them in that sort of situation, when we put them in the situation when they are training and working in an operational way, alongside the Crisis Response Unit.

There have been a number of criticisms about the Crisis Response Unit, by Jon Stephenson, in terms of the way it handles prisoners and our relationship with the unit. That does not help our independent stance in the world. It creates and propagates the possibility that New Zealand is seen as a threat and therefore a target.

I come back to the legislation. As other speakers have mentioned, the New Zealand Security Intelligence Service Amendment Bill is updating the 1969 legislation. It is 42 years old now, and, of course, technology has changed dramatically in that time, with the introduction of cellphones, the internet, data storage, and global positioning. A whole range of different electronic techniques have come into being that were not in any way foreseen in 1969. Now, of course, we are looking to update that.

But, like my colleagues, I want to touch on the process by which this legislation has been examined and looked into. As I said at the beginning, this is extraordinarily important legislation. It should have generated, in my view, a great deal more scrutiny and interest from the New Zealand public. Part of the reason it did not get that scrutiny and did not generate that interest was the way that it was handled. First off, the first reading, which in many ways is the most important reading because it lays out the context in which the legislation is brought into the Parliament, was heard under urgency. This is not legislation that I maintain should be considered under urgency.

Secondly, the select committee process was heard in secrecy. That does nothing, in any way, to alleviate the fears of New Zealanders in terms of whether the provisions contained in this bill can be accepted with a degree of confidence and comfort. Instead, it generates the perception out there that this is secret, and that it will affect them; it generates a sort of suspicion, which we have heard about outside this House. So we have fed those suspicions and those misperceptions, rather than allayed them. John Key said he was going to hear it in secret, and then he said he was having second thoughts. We were flip-flopping all over the place. Jenny Shipley, when she was looking at amending the Act in 1999, maintained that she would hear submissions on that amendment bill in public, and that was very much the stance from this side of the House.

As other people have mentioned, it is the time of the Rugby World Cup. I regret the timing in that we are pushing this legislation through in time for that. I would have thought that we had sufficient safeguards in the current operations of both the Security Intelligence Service and our police network to make sure that we had pretty much all of that covered. Nevertheless, we will be pushing it through in time for that. I hope, as Mr Locke mentioned as well, that we will be able to have the time to go back next year to examine the legislation in a great deal more detail, and hopefully under a great deal more public scrutiny.

The bill was amended as it went through Parliament. I just want to make a specific note of some of those amendments that I thought were very positive. Clause 5A inserts new section 4AAA, which looks at the “Principles underpinning performance of functions”. This amendment was recommended by the Human Rights Commission. Some people say it does not have teeth, but I believe it lays out the real principles on which the Security Intelligence Service should operate, and I think those principles are very welcome. The legislation also makes provision for instances of mistaken identity, the destruction of irrelevant records, and some reporting requirements, as well, which are all welcome.

Hon LIANNE DALZIEL (Labour—Christchurch East): I rise to speak in the debate on the New Zealand Security Intelligence Service Amendment Bill and the accompanying Crimes Amendment Bill (No 3). Obviously I am not on the Intelligence and Security Committee and have not taken a particular role in the passage of this legislation through the House, but I have always taken a significant interest in matters of human rights and matters relating to security intelligence, as well. Having been New Zealand’s Minister of Immigration for a period of time, I have had occasion to work with the New Zealand Security Intelligence Service.

I wanted particularly to acknowledge Keith Locke’s contribution to the debate. I do not always agree with all aspects of his contributions in these matters, but I just want to put on the record that I believe he has been a sincere and consistent voice for civil liberties and human rights in this House, and I think it is a voice that will be missed. I really wanted to place that on the record. I listened to his contribution very carefully, and I felt that this place will be poorer for that voice not being here in the future.

I will say why I believe that the bill should proceed, even though there was some consideration given to the broader security review that will now take place, to which Keith Locke referred. I have spent some time considering the regulatory impact statement, as I am wont to do on legislation, as some members of the House will know. What I appreciated about this regulatory impact statement is that it actually meets the standards of good regulatory practice, because it establishes all the different options. There are really only three options that the committee could consider in this particular instance. The first is the status quo, which it rejected for reasons that I think will be obvious, but I will come back to those. The second was to defer the legislation, and that picks up the point Keith Locke made, which was about the fundamental review of New Zealand security legislation in the next 2 to 3 years, and whether it would be better to tie up this legislation within that context rather than just updating the legislation seemingly on an ad hoc basis. Thirdly, there was the option to have an immediate amendment to the legislation by way of an amendment bill, such as we are now dealing with in this third reading today, to address high-priority amendments. The amendments identified in the regulatory impact statement are those amendments that we are considering in the House today: “providing an express framework for the use of electronic tracking and location devices, clarifying the approach to qualified exemptions for computer offences, expressly providing for the specification of facilities, addressing protections from liability for those persons acting under warrants, amending the requirement to specify those persons assisting under warrant, and fixing gaps in the delegation powers of the Director of Security”.

I wanted to mention what the particular amendments were in relation to, because of the reason the Government has decided not to prefer the status quo, and why the regulatory impact statement, which was prepared by the Security Intelligence Service, did not. The reason it did not prefer the status quo was that the forthcoming Rugby World Cup is being held in New Zealand, 10 years after the September 11 event. We cannot ignore that event in New Zealand. We might feel that we are at the other end of the world, but we are inviting the world to participate in a very major event in this country. I believe we have to be cautious, we have to be careful, and that requires us to update our security intelligence legislation in the manner proposed.

My colleague David Shearer, just as he was concluding his comments, made the point that the Intelligence and Security Committee made some amendments to the bill as it was going through the committee. Picking up where David Shearer left off, the submission of the Human Rights Commission was quite a powerful submission heard by the committee. That submission asked that the principle section include reference to human rights, democratic oversight, impartiality, and professionalism in terms of the role of the Security Intelligence Service. They are very, very important changes. My colleague was saying that it is felt sometimes that the Human Rights Commission does not have sufficient teeth, but I think this was a really good example of where the Human Rights Commission made a valuable contribution to the process, which has led to improvement of the legislation as a result.

The other speakers on the bill have talked, too, about the nature of the independent review of the regulatory impact analysis prepared by the New Zealand Security Intelligence Service. That was reviewed by Dr Warren Young from the Law Commission. In his comments he stated that “While there are some impacts on privacy, this is clearly justified by the associated benefits. In particular, updating the warrant framework is a recognition of technological changes in the storage of and communication of information, and is essential in order to enable the NZSIS to continue to effectively undertake its statutory functions.” That was certainly reassurance on our side for the continuation of this legislation.

The other point I wanted to bring to the attention of the House was that in the regulatory impact statement, a significant aspect of the analysis talked about benefits in terms of the balancing that has to be undertaken between rights—privacy rights and human rights—and our security as a nation. There was a quote from Geoffrey Palmer, which I thought was well worth placing on the record. It begins with reference to national security, privacy, and other fundamental civil liberties being complementary rather than conflicting values. This is the quote from Sir Geoffrey Palmer: “To a very significant extent, ‘national security’ means just this—freedom from interference; freedom from terrorist attack, freedom from deliberately incited racial violence, freedom from espionage which itself threatens basic freedom such as privacy, freedom from the kind of genuinely subversive activity which is aimed—not just in theory but in fact—at destabilising or overthrowing the very democratic system upon which the exercise of civil liberties depends.” I thought that was a wonderful summary of the interests that we debate as competing, when they may in fact be more complementary rather than conflicting in nature. I thought that was certainly a very important point to make.

The Law Commission also, when it was looking at search and surveillance powers recently, had this to say: “while there is a balance to be struck, there is a good deal of complementarity between the two sets of values, particularly in a strong democratic state such as New Zealand. Search powers that encroach too far on human rights values are unlikely to gain legislative or community support. Similarly, investigative powers that are too tightly controlled and that prevent law enforcement officers from doing their job effectively will bring human rights norms into disrepute.” Again, I think that the complementarity principle is one that is well worth taking into account as we consider this legislation.

I am certainly happy to stand here in this House and support the passage of this legislation. I look forward to the modernising of our New Zealand Security Intelligence Service framework. I think it is important that that proceed, and that it gains that broad public support that we need for protecting all of those values that we hold dear to our hearts.

A party vote was called for on the question, That the New Zealand Security Intelligence Service Amendment Bill and the Crimes Amendment Bill (No 3) be now read a third time.

Ayes 107

New Zealand National 58; New Zealand Labour 42; ACT New Zealand 5; Progressive 1; United Future 1.

Noes 10

Green Party 9; Independent: Carter C.

Bills read a third time.

Bills

Regulatory Standards Bill

First Reading

Hon RODNEY HIDE (Minister for Regulatory Reform): I move, That the Regulatory Standards Bill be now read a first time. At the appropriate time, I intend to move that the bill be referred to the Commerce Committee for its consideration.

The Regulatory Standards Bill aims to improve the quality of regulation in New Zealand. As a Government, we use our powers to regulate to ensure that people live safe lives, get treated fairly, protect the environment, maintain a competitive and efficient economy, and much more. But regulation also imposes costs. Excessive regulation can impose unnecessary compliance costs on businesses and individuals and to tier investment, and can limit innovation and competition. Decade by decade the quantity of regulation made in New Zealand has increased. Between 2000 and 2009 over 68,000 pages of legislation were passed. This equates to creating or amending around 105 Acts and 405 regulations each and every year. Many of the countries we compete with have focused on improving the quality of their regulation with more success than New Zealand has had. New Zealand’s ranking in the OECD product market regulation indicators has fallen from 4th in 1998 to 14th in 2008. As a small, isolated country, we need to do better if we want to be competitive in the global economy.

Regulatory quality has been a strong focus for this Government, as set out in the Government Statement on Regulation of August 2009. We have introduced a number of administrative measures designed to improve regulation as it is made and to improve the stock of existing regulation. These measures include strengthened regulatory impact analysis requirements, a programme of regulatory reviews, and a Government-wide scan of the regulation on our legislative books. These measures have led to improvements in the quality of regulatory policy advice provided to Ministers. The fact is, however, that administrative measures alone will never be enough to deliver the level of improvement that New Zealand so desperately needs. Only the Regulatory Standards Bill’s more stringent requirements can bring about a change in the way that Governments think about regulation.

The Regulatory Standards Bill has its origins in the Regulatory Responsibility Bill, which I introduced as a member’s bill in 2006. The Regulatory Responsibility Bill was examined and substantially revised by an expert Regulatory Responsibility Taskforce, established by the Government in 2009. The Regulatory Standards Bill is a result of the work of that task force. I would like to thank Dr Bryce Wilkinson, who first put forward the case for the Regulatory Responsibility Bill in his 2001 publication Constraining Government Regulation. I would also like to acknowledge Roger Kerr, executive director of the New Zealand Business Roundtable, for his tireless work in gaining support for this bill over the last 10 years.

The Regulatory Standards Bill aims to increase the transparency of lawmaking and the accountability of lawmakers. The bill has three key components: it provides a benchmark through a set of regulatory principles that all regulation should comply with; it provides transparency, by requiring those who propose and create regulation to certify whether the regulation is compatible with those principles; and it provides monitoring of the certification process through a new declaratory role of the courts. The bill identifies a set of principles of responsible regulation that all regulation should be consistent with. Regulation is defined to include Acts of Parliament, statutory regulations, and tertiary legislation, but excludes regulation made by local government.

The principles are distilled from sources such as the Legislation Advisory Committee guidelines, common law, and Parliament’s own Regulations Review Committee. The principles cover seven key areas, including the rule of law, the protection of individual liberties, the protection of property rights, the imposition of taxes and charges, the role of the courts, the review of administrative decisions, and good lawmaking. These principles are guides, not binding rules. From time to time, breaches of the principles will be necessary. The bill provides for this, and this is a key point: it allows Parliament to pass any legislation, regardless of whether it complies with the principles. All that the bill requires is that departures from the principles are “reasonable and can be demonstrably justified in a free and democratic society.”

In order to encourage transparency about whether regulatory practices are consistent with the principles of responsible regulation, the bill imposes certification requirements on those who make regulation. Under the bill, chief executives and Ministers responsible for proposed regulation must certify whether that regulation is consistent with the principles. Where regulation does not comply with one or more principles, the Minister responsible must explain why that non-compliance is demonstrably justifiable in a free and democratic society. If there is no Minister responsible, as is the case with some tertiary legislation, the responsibility falls to the chief executive. Certification allows others to understand the impacts of proposed regulation and the trade-offs that we have had to make. We can and do have significant impacts on New Zealand businesses and New Zealanders when we use our regulatory powers. It is only right and proper that we should be open about the impacts that our proposed regulations will have.

The bill provides for the monitoring of the certification process by allowing the courts to provide declarations of incompatibility where they believe the principles have been breached. This power is declaratory only. The courts will not have the power to strike down legislation, to issue injunctions against Parliament or the Crown, or to award damages to those adversely affected by regulation that is incompatible with the principles. Parliament, members will be pleased to learn, remains sovereign. The purpose of the declaratory function is to provide an independent, informed opinion on whether regulation complies with the principles. The function encourages Ministers and chief executives to certify diligently and in good faith, as their certifications are liable to be tested in court. Initially the courts would be able to make declarations only in relation to regulations made after the commencement of the legislation; after 10 years the declaratory power would extend to all regulation.

In addition to the three key components of the bill in terms of principles, certification, and monitoring by the courts, the bill requires the courts to prefer legislative interpretations that are consistent with the bill’s principles. This provision initially applies only to new regulation, but after 10 years applies to the existing stock of regulation. The bill also requires every public entity to use its best endeavours to regularly review all regulation that it administers for compatibility with the principles. The steps that entities have undertaken to review their regulation, and the outcomes of the process, must be included in their annual reports.

This bill provides us with better discipline for creating and managing our regulation. It provides transparency in a similar way to the Public Finance Act. That Act imposes certain responsibilities on Government spending. It says that if we are spending public money, we should justify it and be accountable for it. The Act has created a cultural shift in the way that money is spent in New Zealand and in the whole mindset on public expenditure. This bill places similar responsibilities on Government regulators. It says that if we are using the Government’s regulatory powers, we should justify that and be accountable for it. This transparency will result in higher-quality regulation that has fewer unintended consequences. It will reduce compliance costs, and that better achieves policy objectives. I commend the bill to the House.

Hon LIANNE DALZIEL (Labour—Christchurch East): I have been waiting for the opportunity that the Regulatory Standards Bill represents to express my significant level of disappointment at the Government agreeing to allow this bill to go to a select committee for the sake of political expediency. That is all we will get from the Government on this bill. I do not doubt the bona fides of the Minister of Local Government, who is introducing this bill. He has stated his position on the record more than once. The history of this legislation goes back to the time when I was Minister of Commerce and he was a member introducing a member’s bill on regulatory responsibility. I admire the fact that he has consistently argued for the same result that this bill represents.

The Government, I think, should be a little bit more upfront in terms of its approach to this bill. We know it will vote for the bill to be referred to a select committee, at which point its support for it will end. That will mean that good people out there will make submissions on this bill, both deeply opposed to it and vociferously in favour of it. We will hear all of those submissions, report the bill back to the House, and that will be the end of the matter. I think that is not fair. I do not think it is fair to the House, the submitters, or the Hon Rodney Hide, who has put so much of his personal integrity on the line on this particular bill. I am not as inclined as the Government to waste the time of the House, therefore Labour will be opposing this bill at its first reading and its referral to a select committee.

The reason we oppose this bill is the principle that we do not agree with the content of the bill. The bill contains the original flaw that stymied the original member’s bill when it was introduced to the House a few years ago. That original flaw is that it allows the courts into the lawmaking process itself. The Minister can say as much as he likes that the sovereignty of Parliament is protected, but we know the courts, and we know that if we allow them to make declarations as to consistency they will be entering into the legislative arena, and they are not equipped to do so.

Enabling people to go to court for a statement of non-compliance will hold up the implementation of Government policy. National says that is good. What would have happened to the 100 days of action if the rules that are contained within this legislation had been set in concrete at that point? It would not have been 100 days of action. We know how many days of action it would have been. In fact, it would have been 100 days of inaction, followed by many more days of inaction, followed finally by days of action, as proper regulatory impact analysis after regulatory impact analysis was undertaken. I have not gone back to do a count of the bills passed in those first 100 days of this Parliament, but not many had regulatory impact statements of any quality attached to them at that particular time.

Moana Mackey: But they said they would.

Hon LIANNE DALZIEL: No, the Government did not have them attached. National was elected on a platform, and that is what politics is about. National was elected on a platform stating that it would do certain things, and there was no way that it would introduce regulatory impact statements in order to back up those changes. So it is OK to have regulatory impact analysis as we end a parliamentary term, but, heck, no way would we have regulatory impact analysis when we are starting our term with 100 days of action!

People are assuming that it will all be one-sided about who will go to court and create this period of uncertainty. Do members think the union movement would have gone to court over the 90-day bill? Absolutely it would have gone to court.

As the Minister who spearheaded the Quality Regulation Review, I am disappointed that the Government is fixated with form over substance. That is what this bill is. We do not need a law to tell us to follow guidelines that already exist in this country. We just need Ministers who are compelled and absolutely determined to undertake all of their work in accordance with those guidelines and principles. We need Ministers who understand why the processes are important, and who require their departments to stand up to the very high standards that they set for themselves.

I think the National Party should be ashamed of itself. Based on the principles of the Regulatory Standards Bill, the bill itself would fail to meet the test of responsible regulatory management. Who said that? Do members think an extreme left-winger said that? It was not. It was George Tanner, who was New Zealand’s top statutory draftsman. He was the Chief Parliamentary Counsel here in Parliament. He states that “The Bill uses open-textured language” that will lead to uncertainty of meaning. According to him, the bill “attempts to define good law-making by reference to a set of simple principles: in doing so it obscures the complexities inherent in them and creates the same lack of clarity and uncertainty that it seeks to prevent.” Brian Fallow stated that the principles are abstract, constitutionally unorthodox, and substantively unsound.

When I launched the Quality Regulation Review, which addressed regulatory barriers to business growth, I knew we had to have a stronger mechanism in place to make sure that the regulatory impact analysis was being undertaken. I was not able to deliver that from the Ministry of Economic Development’s regulatory impact assessment unit. I could not do that, so I met with Michael Cullen. He was the Minister of Finance, and we agreed that we would put the oversight for regulatory impact analysis into the heart of Government: Treasury. That is where we shifted it to, and that is where it stays. I believe that is where it has always belonged, enabling departments to step up to the plate as far as regulatory impact analysis goes.

We made sure that regulations that were being proposed were necessary and efficient, and we required all our departments to really come to grips with problem identification. That is one thing that the regulatory impact statement that accompanies this bill does not do. It does not even have a proper problem definition. How on earth does one fix a problem if one has not identified the problem?

In terms of setting out the options, I want the House to know that Treasury, which we have now entrusted to undertake this role, does not believe that this option—a bill—is the best option for New Zealand. Are we just doing this for a figurehead reason? Treasury believes that legislation “has a status, profile and educative effect that equivalent administrative measures or Standing Orders can’t quite match. But it is also more formal, less adaptable to varying circumstances, harder to fix or amend in response to problems or changing needs, and brings with it the potential involvement of the courts, with sometimes unpredictable results.”

Treasury’s statement continues: “For promoting legislative quality there are limits to what we can expect from a legislative initiative. It is very hard to use legislation to target the quality of policy development and legislative review because the quality of these processes is not readily observed or verifiable by outsiders. It can only encourage behavioural change, but the pressures, incentives and biases acting on Ministers and officials that lead to poor legislation are strong. Unless it somehow catalyses a new behavioural norm, the gains in legislative quality will probably be modest. … The big question marks are really the risk of unintended outcomes, and the ability to manage costs if benefits turn out to be far less than hoped. These are the reasons we do not recommend adopting Option 1—the Taskforce’s proposed Bill.” and the modified version we have here today. “The likely approach and effect of court involvement is impossible to predict and we think the interpretive direction creates a particular risk of unintended outcomes.”

This bill does precisely the opposite of what it states it intends to do, and that is why the Labour Opposition will not be supporting the first reading and referral of this bill.

PESETA SAM LOTU-IIGA (National—Maungakiekie): It is my privilege to speak to the Regulatory Standards Bill. May I acknowledge the Minister for Regulatory Reform for bringing this bill to Parliament and for the work he has done on the principles around regulations and in terms of improving the way that Parliament works. The previous speaker, Lianne Dalziel, will rail against this bill proceeding to the select committee. I was not in the last Parliament, and I did not get an opportunity to listen to the submissions on the Regulatory Responsibility Bill, but I certainly welcome the new bill. I look forward to hearing the submissions to the select committee with an open mind in terms of proceeding with the bill through its process.

What does this bill do? If we go back to first principles, we see that it is about breaking regulations and making more effective laws and regulations, as part of this Government’s brief. It is part of the plan that the Labour Party does not have. That plan is to increase our exports. It is a plan about innovation and trade. We have just heard in the last week that the Prime Minister has been to India to negotiate the type of trade agreement that will bring about prosperity for this country. The plan is also about making Government services more effective. That is part of our plan. It is also about effective taxation. Last year’s tax switch was another building block in this Government’s regime to bring about prosperity. The Government’s plan is also about infrastructure spending. So breaking regulations, and certainly making more effective lawmaking processes, are part of our plan.

What does the bill do? Cutting red tape and regulations certainly is about driving economic growth. It makes it easier for businesses and New Zealand companies to do better. By doing better, they provide better and more opportunities for those who are after jobs. The bill is also about, as the Minister pointed out in his speech, putting in place an annual programme to clean up regulations. Before the Commerce Committee right now we have a regulatory reform bill whereby we are cleaning up a number of statutes across the legislative menu. It will simplify a number of laws and establish productivity-raising regulations.

Hon Lianne Dalziel: My idea.

PESETA SAM LOTU-IIGA: Ms Dalziel says it is her idea—but we are implementing it. She might have thought about it, but we are carrying out and doing the things that will bring about change in this country.

This bill is about providing better regulation and less regulation. When we think about the competing interests in terms of regulations, we know that New Zealanders are affected by regulation every day, whether it be the speed limit on our roads or the fact that we drive on the left-hand side of the road. Regulations help to ensure that we live safer lives, that we are treated fairly, that we protect and manage our environment, and that we have a competitive and efficient economy. Those are the things that this Government stands for. But regulation is much, much more than that, and we know that. As lawmakers we have to be careful, because regulations also have costs. They have unintended impacts and consequences, and if regulations are poorly conceived and poorly implemented, they can lead to significantly higher costs, which can hinder our freedoms as individuals and stifle innovation and productivity.

National will introduce new regulation only when we are satisfied that it is required, that it is reasonable, and that it is robust. We have gone about our legislative programme, whether it is simplifying employment law to encourage employers to hire new staff, reduce compliance costs, and give choice in terms of holidays, and whether it is introducing changes in the Resource Management Act, which had become so stifling of creativity and business development that we have had to streamline some of the provisions of that Act. We have allowed, for example, simplified consents for major projects, including—and the member of Parliament for Taupō was here—a $1 billion private geothermal power station in Taupō, which was approved within a record 8 months. We have put in place that sort of regulation-busting legislative agenda.

If we talk about this bill—and I know that the honourable member for Christchurch East did not even refer to the bill once—and look at the principles behind it, we see that they are principles that we take for granted but that are not sometimes followed. They are principles of the rule of law. They are principles around our individual freedoms and liberties. They are about protecting private property rights, which the Hon Rodney Hide has championed during his career as a politician. They are about the role that the courts play within the democratic process, and about what good lawmaking process is. I certainly commend the referral of this bill to the select committee. I look forward to the submissions both for and against the bill. I certainly will treat this bill with the respect that it deserves.

CHARLES CHAUVEL (Labour): I agree with some of what the last speaker, Peseta Sam Lotu-Iiga, said about the principles of the Regulatory Standards Bill. They are, at least on their face, principles that pretty much anybody should support. Obviously, legislation should be consistent with the rule of law. The law should be clear and accessible. It should not adversely affect rights and liberties or impose obligations retrospectively. Every person should be equal before the law, and issues of legal right and liability should be resolved by the application of law rather than by the exercise of a discretion on the part of officials, elected or otherwise. Those principles are incontrovertible and, as my colleague Lianne Dalziel said, are the basis on which the legal system rests. They are the basis on which all the presumptions around our legislation are construed when the courts exercise their ultimate right to decide what we meant when we made a law.

Similarly, in respect of liberties, laws should not diminish a person’s liberty, personal security, freedom of choice or action, or rights to own, use, and dispose of property except as is necessary to provide for or to protect any such liberty, freedom, or right of the person themselves or of another person. But in this legislation we again have a fundamental principle or canon of interpretation that the courts will use now, when they construe legislation passed by this House. They will read laws down if they appear to offend against those principles. Only if this Parliament were to use the clearest possible words could the courts come to a contrary conclusion.

Likewise, there is a principle contained in the bill around the taking of property: laws should not take or impair, or authorise the taking or impairment of, property without the consent of the owner unless there is an overriding public interest involved, full compensation for the taking is provided, and it is provided on behalf of or by the persons who obtain the benefit of the taking. Again, no one who has studied our constitution would find that surprising.

Likewise, taxes and charges should not be levied under any administrative provision; they should be authorised only by a principal enactment. The charge should be reasonable in relation to both the benefit the payers are likely to obtain from the goods or services, and the cost of efficiency in providing the goods or services. Again, that is inarguable.

In terms of the role of the courts, they should always have that authoritative right to determine the meaning of legislation, and there should always be a right of appeal on the merits against decisions to a court or other independent body, and there should be appropriate criteria laid down for the making of decisions by the court or independent body.

Finally, there are principles enunciated around good lawmaking. Laws should not be made unless, to the extent practicable, the persons likely to be affected by the legislation have been consulted. Laws should not be made unless there has been a careful evaluation of the issue, of the effectiveness of existing legislation and law, of whether the public interest requires that the issue be addressed, and of any other options, including non-legislative options for dealing with the problem. There should be careful evaluation of who is likely to benefit and who is likely to suffer a detriment from the legislation. There should be careful evaluation of the potential adverse consequences of the legislation, including the Crown’s potential legal liability, that are reasonably foreseeable. The benefits of the legislation should outweigh the costs of it, and it should be the most effective, efficient, and proportionate response to the issue concerned. Again, nobody could argue with these principles. They are right and they are self-evident, but they exist already in terms of the way, hopefully, we evaluate legislative proposals.

One of the problems about the bill, and one of the reasons why members on this side have real concerns, is that although it seems to state very fair-sounding principles, very inarguable principles, principles that most would accept without second thought, the way in which the principles would then be applied to legislation is the problem. The bill provides that wherever an enactment can be given a meaning that is compatible with the principles, it is to be preferred to all other meanings.

A court can make a declaration of incompatibility between legislation that this House, this Parliament, may make in future and the principles outlined in this bill, if we are to pass it. The problem we then get constitutionally is that if the court does that, the declaration of inconsistency has no legal effect. It does not affect the continuing operation of the inconsistent measure, and no court may hold any provision of the legislation to be impliedly repealed or revoked. So what is the point? That is really the question here. What is the point in this legislation? Why bother stating principles that already underpin our constitutional arrangements, then get a court to say that a future Parliament has breached those provisions, but if we do, the court’s declaration will not mean anything? What sort of constitutional merry-go-round are we talking about here? What sort of waste of money are we contemplating putting on the statute book by engaging in this exercise?

I just want to run through some of the criticism that I think has been made, justifiably, of the bill, apart from the problem that I have just identified. First of all, the Regulatory Responsibility Taskforce failed to justify why this sort of bill is necessary. There is very little evidence showing why a rigorous or intensive approach is required, as opposed to some of the other options that were canvassed by the Commerce Committee when mark 1 of this legislation was considered. There is no convincing argument as to why legislation is required to ensure better legislation, as opposed to other means of improving the way that we do things here. When we measure the Regulatory Standards Bill against its own principles, it is clear that no responsible legislator could vote for it.

There is ambiguity in the legislation, and again referring to earlier attempts in this area, George Tanner QC referred to the open-textured language used, which leads to uncertainty of meaning. He said: “It attempts to define good lawmaking by reference to a set of simple principles: in doing so it obscures the complexities inherent in them and creates the same lack of clarity and uncertainty that it seems to prevent.”

I referred earlier to the difficulty that this legislation will create for the third branch of our government, the judiciary. As Sir Geoffrey Palmer has pointed out in a recent article: “Neither the judges nor the legal profession are proficient in policy analysis of the type that leads to regulatory legislative proposals.” In this respect the Regulatory Standards Bill would confer on the judiciary a novel role for which they are not resourced or equipped. I can hear the cries now from parliamentarians and others who do not like the idea of judges expressing a view on policy and content, yet here is exactly what is being invited of them by this legislation. We will get all sorts of accusations about the activist judiciary overstepping the mark and overstepping its role, yet that is exactly what we would be inviting them to do by the text of this legislation.

I think, ironically, this bill will create more compliance costs than it would save. The relevant Minister, or the public entity, will need to undertake a certification process. There will be regular reviews of all legislation, annual reporting requirements by every entity, ministerial oversight of the review, and then the prospect of litigation being generated by the possibility of an application for a declaration of incompatibility. That all implies massive resources, particularly over a 10-year time frame, which George Tanner QC referred to as unworkable and unrealistic.

We have real problems in the legislation. There are better alternatives. The Commerce Committee has already considered those and has said that if a regulatory impact statement and ministerial sign-off on compliance with Legislation Advisory Committee guidelines were taken seriously, they would make a real difference here. We should try using what we have, improving it, and actually adopting the principles that the bill would exhort us to follow. We should look at what we have and decide whether it is workable before we embark on an innovation such as this, which will be costly and unworkable. That is my challenge to the Minister.

Dr RUSSEL NORMAN (Co-Leader—Green): I rise to speak on the first reading of the Regulatory Standards Bill, a bill put up by the ACT Party and apparently being voted for by the National Party. This bill has so many things wrong with it that it is hard to know where to start, so I thought I would start in the middle and talk about the issue of takings. I think that is an interesting issue, which this bill very much brings to the fore.

The way that this bill works is that when a bill comes to Parliament, the Minister and the chief executive have to sign a piece of paper that says the bill meets the regulatory principles, or, if it does not, there is public interest in it not meeting those principles. There is a set of principles, and I want to talk about one of those principles, which is the issue in regard to takings and property. Basically, the bill states that legislation cannot take someone’s property or impair someone’s property, unless that is in the public interest and that person or corporation is compensated in the process. That is essentially what it says. If we were to take some case studies to flesh out what this would mean, I think it would demonstrate the problem with this kind of approach to lawmaking.

For example, we can talk about the plain packaging of tobacco products. If a Government were to introduce the plain packaging of tobacco products, certain tobacco companies would argue that their property rights had been impaired as a result of that. Philip Morris could come out and say it used to be able to use its Marlboro brand and all the rest of it, but it cannot any more, so therefore its property rights had effectively been impaired. Philip Morris could say that if the Government thinks there is a public interest case, so be it, but the Government would have to compensate Philip Morris if the Government were to follow the principles in this bill. That would mean that before the Government could move to introduce the plain packaging of tobacco products, it would be required to compensate Philip Morris for the entire impairment of the intellectual property rights around its branding. If this sounds vaguely familiar, the reason is that Philip Morris is currently launching a case against the Australian Government under the provisions of a bilateral investment treaty between Australia and Hong Kong that uses exactly the same principles. Over there it is termed “expropriation” or “indirect expropriation,” but it has exactly the same meaning.

My challenge is to the Labour Party, actually. While Labour was in Government it signed a whole bunch of trade treaties that had exactly the same provisions, which enable multinational companies to sue our Government through bilateral investment treaties. Those provisions are within the China free-trade agreement, and a bunch of other bilateral investment treaties have those provisions, as well. It seems to me that signing up to trade agreements or passing law that enables corporations to sue Governments for their actions is a very, very bad idea. If we were, for public health reasons, to require the plain packaging of tobacco, then I think that would be just too bad for Philip Morris. I do not think we should compensate Philip Morris for the fact that it would lose some money in the process. I say to National that if it introduces this kind of law, the onus would then be on the Government, whenever we wanted to introduce a regulation that would impair someone’s property rights, to compensate them, if we were to be consistent with the principles of this bill. I ask whether that is really what the Government wants to do.

We know the answer to that question, and it is that the National Government does not want to do this, because this is not the first time that this kind of legislation has come to Parliament. In fact, a bill that came to Parliament under the name of Gordon Copeland previously did a similar kind of thing. At the time the National minority view opposed it. Chris Finlayson was leading the opposition to it at that time. He said the amendment would “have far-reaching implications and could well be the cause of a great deal of litigation against the Crown” if we were to introduce this kind of principle. He meant that if we introduce the kinds of laws that say we cannot pass a law without compensating someone whose property is impaired, then all of a sudden we could be sued by a whole bunch of corporations whenever we tried to pass legislation that they did not like. The National members of the Justice and Electoral Committee went on to state: “compensation issues should not be simply left to the courts. There should always be a proper statutory basis for compensation.” It should not be left to the the courts and the process through the courts for corporations to sue the Government or Parliament if we try to introduce rules.

There is a bunch of other rules that we could talk about—for example, those on building standards. Building standards are a very relevant issue, because New Zealand has just had the leaky houses crisis. One estimate is that the leaky houses crisis has cost our country $20 billion because of the poor regulatory framework that was set up around the building industry. The weak building regulations have had to be strengthened in recent years, as a result of the disaster of the leaky housing crisis. There would be those involved in the industry who would argue that if we tried to strengthen building standards, and that resulted in their products—for example, monolithic cladding; James Hardie’s comes to mind—no longer being used or not being used as much as previously, because we had strengthened the building regulations, then they could sue us as a result of the impairment of their property. James Hardie’s could say the Government’s new building regulations would result in its monolithic cladding—which was one of the causes of the leaky housing disaster, but not the only one—no longer being used, because everyone was going for weatherboard, and therefore the Government had cost it an awful lot of money and it wanted compensation. James Hardie’s could say that under this Regulatory Standards Bill, which Parliament had been silly enough to vote for, the firm had the right to sue the Government for compensation because it has closed up the rules around leaky houses.

The reason that this issue is particularly apposite on this occasion is that the chair of the working-group that put the basis of this bill together was none other than Graham Scott, who, more than any other person in New Zealand, is responsible for the leaky houses crisis. I like to call him our “$20 Billion Man”, because he was the head of Treasury when all the relaxation of the building standards was pushed through. Treasury was very active under Mr Scott in relaxing the standards around building. It is, in fact, the ACT Party and Mr Scott who can be blamed for the $20 billion leaky houses crisis. If there could ever be an example of a situation where regulations are important and necessary, the leaky houses disaster is probably the most obvious one. There are many other examples, but that is one example of a situation where having good, strong regulations can be expensive upfront, because it means the houses costs a little more to build, but actually is in the long-term best interests of the country—and especially of the people who are now living in rotting houses and having their life savings whittled away because National weakened the standards around buildings back in 1991 with its Building Act.

If this bill were actually to become law, then it would become difficult to tighten up the rules around building standards. If we discovered that a mistake had been made that allowed a bunch of bad products and bad practices to result in a leaky housing disaster, and we wanted to tighten the rules, those companies that lost money as a result—and some would—could rightly sue the Government for compensation. We can imagine the chilling effect that it would have on the Government if, every time that we wanted to fix up a regulatory problem, we had to compensate everyone who had lost property or had their property impaired as a result of that process. It would make it much more difficult.

Think, for example, about environmental standards, which are another classic problem. Climate change—by introducing a carbon tax there are winners and losers. Those people who have carbon-intensive products would sell less of their product as a result of a carbon tax, and their businesses would be worth less. They could rightly argue that their property rights had been impaired, and therefore could sue the Government for compensation, if we tried to restrict greenhouse gas emissions in New Zealand. The Government would have to compensate them. Every business would line up in the courts and seek compensation if these kinds of principles were put into law.

There is so much that is wrong with this bill, and I have focused on just one particular aspect. We could also talk about the way that the judiciary would be dragged into the policy process. We could talk about the way that the neutrality of the Civil Service would be compromised, because senior public servants would have to basically sign off on political processes. We could talk about the fact that this bill will not even necessarily help business, because it would make the process of lawmaking and regulation much more difficult. But I think that it is worth thinking particularly about the property compensation issues, because they have relevance not just for this bill but also for the bilateral investment treaties that Labour and National are both very keen on. Thank you.

Hon HEATHER ROY (ACT): I am very pleased to rise in support of the Regulatory Standards Bill. The Minister for Regulatory Reform gave an excellent speech about the history that led us to this point and what this bill will do. Listening to the Green member who has just spoken, Russel Norman, reminded me exactly why this sort of legislation is needed. He took the opportunity when speaking on this bill to have a whack at everything he dislikes. There was some environmental stuff in there. The ACT Party and Graham Scott, who probably best understands public policy in this country, got a swipe. Russel Norman started off by talking about one of the Green Party’s old favourites—the plain packaging of cigarettes—as if that will make any difference at all to the rate of smoking.

The basic principles of lawmaking are very often overlooked. I often say that laws should be clear, they should be enforceable, and they should be routinely enforced. Plenty, sadly, are not, which is why there is a need for this legislation. The first reading of this bill is a very proud moment for the ACT Party, and the Minister has worked tirelessly to get the bill to this point. As part of our confidence and supply agreement with National, the Regulatory Responsibility Taskforce was put together. The drafting of this bill was the result of the work of that task force, following on from the introduction of the Regulatory Responsibility Bill, which was a member’s bill.

It was interesting to hear the Labour Party contributions to debate on this bill. It seems that it is not opposed to having principles; it just does not want to do anything about promoting them. Lianne Dalziel talked a lot about her general agreement with the principles espoused in the bill, which is very pleasing. She also talked about fairness, though, and she gave some reasons why this bill should not go to the select committee. She said it was because of fairness and because she did not want to waste Parliament’s time. When we come back to this House tomorrow it will be a members’ day, which is the only opportunity that backbench MPs get to debate their issues. We will see who is most concerned about not wasting Parliament’s time then. We will see, as we have seen on every members’ day since last December, the filibustering that is going on to prevent one particular bill getting through Parliament.

Charles Chauvel stood up and said he objected to a number of things. He too talked about the value of the principles, but then he gave a long list of objections, explaining why the bill should not proceed. It seemed to me, sitting here and listening very carefully, that they were mainly objections to Ministers doing exactly what should be expected of them. There is nothing wrong with expecting legislation to be fair and clear, and there is nothing wrong with expecting legislation to be enforceable and routinely enforced.

The bill itself sets clear standards that new rules and regulations will be measured against, which is very important. The Minister talked about transparency and accountability, which are easy words to rattle off but much harder principles to put in place. These standards spell out what good laws look like and what they should do. As lawmakers, every one of us in this Chamber has the responsibility to ensure that that happens. For example, laws and regulations should treat everyone equally, they should be accessible, and they should be easy to understand. They should not remove property rights without good reason or without compensation. They should not remove the right to appeal to the courts.

Secondly, the bill would require anyone proposing new laws or regulations to certify that their proposals met such standards. If laws do not meet those prescribed standards, the person proposing the law—either a Minister or a member—would need to explain to Parliament why the law does not comply and why the legislation being proposed meets the public interest. Finally, if someone believes that a new law does not meet the standards, then that person will be able to go to court. The court can then issue a declaratory judgment. So there are checks and balances, there is transparency, and there is accountability—things that every member in this House, at one time or another, has stood up, either here or on an election campaign stage, and talked about. This bill is about putting in place those very things.

For those who have objections to the bill, I have some questions. These are questions that all people drafting a bill should have to ask themselves, and are exactly what this law is putting in place. Why is this law or regulation needed? What will it achieve? What is likely to happen if the law is not put in place? What side effects might there be? Unintended consequences are something that we see all too often. Are there any alternatives, and what makes this particular legislation the best option? We should ask whether anybody’s legal rights or property rights are being infringed, whose they are, whether they consent, and, most important in the issue of property rights, whether they are being compensated for this loss. Does the regulation follow the principles of responsible regulatory management? And we should ask when the regulation will next be reviewed, which this bill also allows for.

When I was Minister of Consumer Affairs, my major project was to look at consumer law, and we ended up with the consumer law reform project. The project took seven of the 12 pieces of consumer law and is amalgamating them. When I looked at consumer law, I saw two very good principles-based pieces of legislation: the Fair Trading Act and the Consumer Guarantees Act. There were also a lot of other smaller laws that had been around for a very long time. The one that was the oldest was the Auctioneers Act, which was put together in 1928 and still had provisions for people tethering a horse when they went to the stock markets. It has been a very long time, I think, since horses have been tethered by people taking their stock to market. That Act highlights in a very simple way the principle of the importance of reviewing legislation.

I proudly stand here today and support the Minister for Regulatory Reform in this initiative to look very carefully at the lawmaking that happens in this House, the way it is gone about, the need for it, and what exactly should happen. We will see as a result of this bill strengthened regulatory impact statements. I frequently asked to see those at select committees when I was in Opposition, and was just as frequently told that the regulatory impact statement was not ready yet. For some laws we never saw any. The bill will put in place regular reviews, as I have just outlined, and that too is very important. It will result, as the Minister said, in better discipline, transparency, accountability around public expenditure, and much higher quality regulation—something that each and every one of us in this House should bend over backwards to put in place. Thank you very much.

TE URUROA FLAVELL (Māori Party—Waiariki): Kia ora tātau e te Whare, tātau kua hoki mai i uta, i tai, ki roto i ngā pakitara o te Whare, me te mōhio anō hoki, koinei te Wiki o te Reo Māori. Me whakanui i te āhuatanga o te reo Māori, kaua mō te wiki engari, he pai tonu kia aro atu ki tērā o ngā whakaaro i tēnei wā. Heoi anō me kōrero Māori i te roanga o te tau, kia taea ai te kī, kua tangata whenua tonu te reo Māori ki Aotearoa nei.

Ko tāku noa ake ko te kī atu, kei te kōrero tātau mō te Regulatory Standards Bill. Me pēnei rawa te kōrero, kāre te Pāti Māori i te whakaae ake ki tēnei o ngā pire. Me kī atu ko te tino tikanga o tēnei pire, he whakatikatika, he whakapai ake ko te tiketiketanga o ngā whakaritenga i Aotearoa nei. He whakapapa tōna, he whakapapa mai ai ki tētahi o ngā pire motuhake nei. Ko te ingoa o tērā pire i ngā tau kua hipa, ko te Regulatory Responsibility Bill. I tae mai tērā pire ki tēnei Whare Pāremata i te tau 2008 engari, kāre i pāhi, kāre i eke.

I tōna hōhonutanga, kei te āhua whakaae atu mātau ki te whāinga o tēnei o ngā pire, kia mārama te ture, kia tika te ture, kia pono te ture. Kia taea ai e wai rānei te whai atu i te ture ki tōna tiketiketanga, tuatahi. Tērā kōrero tērā.

Tuarua, kia kore e pā kinotia te tangata e te āhuatanga o te ture, i tōna oranga, i te rangatiratanga o tēnā, o tēnā. Ka toru, e ōrite ana te tangata, ahakoa ko wai ki raro i te korowai o te ture. Me pērā rawa te noho o te motu i raro i te korowai, tātau katoa.

Nā, he māmā noa iho tērā te kōrero engari, tōna whakatinanatanga kei reira tonu te uauatanga. Pēnei i te mema, te kaiārahi o te Rōpū ACT nei, arā te Tākuta Brash nei i roto i te Whare i te ahiahi nei. Koinā tāna e whai nei engari, koinei tāku e kī nei. Ko te kōrero mō tērā kōrero, arā anō tērā engari, ko tōna whakatinanatanga, e hoa mā, kei reira tonu te uauatanga.

Nō reira, e toru pea ētahi mea hei whakatakoto ki mua i te aroaro o te Whare Pāremata i tēnei wā. Me huri atu ki ērā o ngā kaupapa i tēnei wā. Tuatahi ka pātaia te pātai, kai hea te Tiriti o Waitangi ki roto i ngā whiriwhiringa o tēnei o ngā ture? Kei te whai mai tēnei o ngā pire, me kī, i ngā tapuwae o te pūrongo o te Taraipiunara o Waitangi, me tana pūrongo mō Wai 262, i puta i ngā rā tata kua hipa ake nei. Ki taku mōhio, i roto i tērā o ngā pūrongo e mea ana, kei reira tonu te tirohanga kia noho hoa haere, me kī, ko te Karauna rāua ko te Ao Māori, i roto i ngā whiriwhiringa ā ngā tau kei mua i te aroaro. Anā, kei reira tonu, me kī, te huarahi hei mea para mā te Karauna rāua ko te Māori ā ngā tau kai mua i te aroaro. Ko te mate kē i roto i tēnei pire, kotahi anake te wāhanga e kōrerohia ana, ko tērā e pā ana ki te Karauna. Kāre he kōrero mō te āhuatanga ki te Ao Māori, arā, pēnei i tāku e kī nei mō te āhuatanga o te Tiriti o Waitangi. Nō reira, tērā tērā, take nama tahi me kī.

Tuarua, kei roto i te hōhonutanga o te pire, kei reira tonu e noho taupatupatu nei. Nā, hei tauira ake, mēnā ka āta titiro ki te hōhonutanga o tēnei pire, arā mō tēnei mea mō te tango rawa nei, me kī, ko te taking of property. Nā kei roto i te pire nei, kei reira tonu e mea ana, ā, e kore e taea e wai rānei te tango, te pupuri mai i ngā rawa a te tangata, ki te kore taua tangata e whakaae atu, ka mutu, ki te kore he utunga e whai nei ki taua tangata. Nā reira he pai tonu tērā whakaaro, mēnā ka tangohia mai ai ō rawa, ā, tuatahi me whakaae atu, tuarua, mēnā ka pērā, me whai utu anō koe mō tērā momo mahi. Mēnā ka whai tonu tātau i tērā huarahi, ā, mēnā ka kī tātau, mēnā ka whakaae tātau kia ōrite tātau i raro i te korowai o te ture, nei au e pātai nei i te pātai - pēhea ngā āhuatanga o ngā kerēme tiriti, ngā whakataunga Tiriti o Waitangi, e kōrerohia nei, e wānangahia ana? Mēnā ka whai tātau i tērā momo āhuatanga, ē, kua whai rawa te Ao Māori nā runga i ngā mahi tinihanga a te Karauna i ngā tau kua hipa. Nō reira, he take nui tērā hei mea kōrero, hei mea wānanga. Āe, mēnā kei raro tātau i te korowai o te ture, kia ōrite te āhuatanga, ahakoa ko wai, ā-iwi Māori nei, ā-tangata i tōna kotahi nei.

Nā, ko te take tuatoru, me kī, ko te āhuatanga o tēnei mea o te āta wānanga i te tika o te ture. Nā, me kī, ki te wāhanga e kī ana good law-making, tērā wāhanga. Kei roto i tērā wāhanga e mea ana, kia āta wānangatia, kia wātea te ture, ngā ture katoa, kia āta wānangahia, kia kitea mai ai ko wai te hunga ka whiwhi hua mai i tērā ture, me te hunga ka rongo nei i te ngau o tērā ture, arā, ko te hunga kore whiwhi i ētahi painga nā tērā ture. Me pēnei rawa te kōrero, me whai wāhi te tangata whenua ki te āta titiro ki te hōhonutanga o tēnei o ngā wāhanga, arā, kia taea e te tangata whenua te wānanga i te tikanga o tēnā o ngā wāhi. I te mea, tērā pea, kei roto i ngā ture ka kitea mai ai i ngā huringa whakamuri, mei kore pea e kite i ētahi painga o roto i ngā ture i ngā tau kua hipa ahakoa, kei reira tonu ngā hē rawa o te ture. Nō reira, kei reira tonu tērā āhuatanga, arā, kua hangaia ētahi ture i ngā tau kua hipa. E hiahia anō tētahi ki te whakatika i ērā ture, ko te mate kē kua kino, kua puta mai anō ētahi kino o roto i ngā ture ka hangaia. Nō reira, tērā tērā.

Ka mutu, ko te wāhi whakamutunga ki a au, ko te wāhanga e kī ana, e āta titiro ana ki tēnei mea o te ture kia whakamātauria. Arā, kei roto i te ture ka whakamātauria, ko te āhuatanga o ngā tikanga a te tangata kotahi. Engari, karekau he paku kōrero o roto i te ture mō te āhuatanga o ngā tikanga ā-kāhui tangata. Ka titiro ki te tangata kotahi, kaua ki te kāhui-ā-tangata, arā, ki te kohikohinga o te iwi, tērā momo āhuatanga. Me titiro anō rā te Minita ki tēnei take. Nō reira, koinei ngā take e toru e hei tīmatanga kōrero. Tērā pea ka rongo ngā taringa o te Minita Hide ki ēnei take. Tērā pea, ka whakahokia mai ai ki roto i te Whare Pāremata ā te wā. Mō tēnei wā tonu nei, kāre mātau i te whakaae atu ki tōna hōhonutanga engari, ka waiho ake tērā take kia tārewa mō te wā. Tērā pea, nā te āhuatanga o te whakahokinga mai o te Minita, ka aro pai ki tēnei o ngā ture. Nō reira, kia ora tātau.

[Greetings to us, the House, we who have returned from near and far to be within the walls of the Chamber, knowing full well that this is Māori Language Week. Aspects of the Māori language should be celebrated, but not just for a week. That thought merits further consideration. Māori should be spoken at greater length during the year so we can say that it has become firmly embedded here in New Zealand.

We are debating the Regulatory Standards Bill, and we of the Māori Party oppose it. The main purpose of the bill is to improve the quality of regulation in New Zealand. It has a genealogy. It came out of a member’s bill called the Regulatory Responsibility Bill. That bill came before this Parliament in 2008, but was not passed and did not make it.

In essence, we agree with the general principles of the bill, that the law should be clear, apt, and honest. But who can pursue the law to its conclusion? That is the first point. I leave that there.

Secondly, aspects of law should not adversely affect an individual in terms of their well-being and autonomy. Thirdly, every person, regardless of who they are, is equal before the law, and under its cloak. The nation, all of us, should exist like that, under the cloak and protection of the law.

Talking about it is the easy part. Implementing it is the hard part. It is a bit like the leader of the ACT Party, Dr Brash, who is in the House this afternoon. That is what he is after, and that is what I am referring to. Talking about it is one thing, but putting it into action is where the real difficulty is.

Therefore, there are perhaps three things to put before the House at this point. Let us turn to those matters now. Firstly, the question has to be posed about where the Treaty of Waitangi was during the negotiations undertaken for this bill. The bill comes hot on the heels of the Waitangi Tribunal Wai 262 report, just released in recent days. According to what I know, that report states that the Treaty envisages the Crown-Māori relationship as a partnership, in future negotiations. The way ahead for a Crown-Māori relationship in the future is still there. Yet the problem is that in this bill only one side is referred to, and that is the Crown. There is nothing about the state of Māoridom. It is like what I have been talking about in terms of the Treaty of Waitangi perspective. So that is issue No. 1, perhaps.

Secondly, there are still debatable issues in the details of the bill. There is an interesting irony, for example, in the detail of measures in this bill around the taking of property. The bill suggests that property can be taken, or authorised to be taken, without the consent of the owner, if full compensation for the taking or impairment is provided to that person. That idea is a good one if someone’s property is taken, but first they must be consulted. If that happens, they must be compensated for such an action taken against them. If we continue to go down that road, and agree that every person is equal under the cloak of the law, then I must ask the question: “What about circumstances relating to Treaty claims and Treaty settlements currently being addressed and debated?”. If the same regulatory standards applied, if we followed that kind of reasoning, Māoridom would be resourced to the hilt as a consequence of the Crown’s deceitful actions in years past. So that is a huge point to talk about and debate. Yes, if we were indeed under the cloak of the law, everyone would be equal before the law, regardless of who they might be, Māori people or others.

The third issue is the matter of carefully debating the appropriateness of the law—let us say, the provisions relating to good law-making. Those provisions suggest that every piece of legislation must contain a careful evaluation about who is likely to benefit and who is likely to suffer a detriment from the legislation, and all the potential adverse consequences of the legislation. We urge that local Māori be involved in examining the detail of those provisions carefully to see whether any retrospective steps will be taken to address past issues that clearly fall into the category of bad law-making. That situation still exists, in terms of bad laws still being made. One would like to amend those laws, but the trouble is that tainted laws have led to other faults appearing in the laws being drafted. So that is that matter.

Furthermore, my conclusion concerns the provisions that look carefully at the aspect of the law to be tested. The bill makes an issue of testing legislation against the concept of individual liberty. Absent from that discussion is any notion of collective rights. The Minister must look at these issues again. These three points are just a starting point for further discussion. Perhaps Minister Hide will pay attention to these issues, and in time bring this bill back to the House. For the moment, we do not agree with its details, and leave it hanging there. Depending on how the Minister brings the bill back, we might favour it then. So greetings to us.]

KATRINA SHANKS (National): As the Minister for Regulatory Reform mentioned earlier, the main purpose of the Regulatory Standards Bill is to improve the quality of regulation in New Zealand. A key part of this Government’s plan for stronger economic growth is cutting red tape and regulations. The simple fact is that New Zealand has a problem with excessive regulation. These regulations impose real costs on our businesses and unnecessary burdens on individuals. We want to make it easier for New Zealand companies to do business, to lift productivity, to create jobs, to boost incomes, to improve living standards, and to provide the world-class public services our Kiwi families deserve. National believes that better regulation and less regulation are essential to help New Zealand become more internationally competitive and a more attractive place to live and do business. We recognise that in order to allow our businesses to move ahead, to grow, and to develop we need to address—and remove, where possible—barriers to this growth.

The Regulatory Standards Bill attempts to provide greater transparency and accountability for the quality of laws and regulations in New Zealand. The bill has its origins in a member’s bill known as the Regulatory Responsibility Bill, which Parliament’s Commerce Committee examined in 2008. The committee recommended that the member’s bill not be passed but that the Government establish a high-level expert task force to consider options for improving regulatory review and decision-making processes. The current Regulatory Standards Bill is the result of the work of this task force.

As my colleagues have mentioned, the Regulatory Standards Bill would require all proposed new laws and regulations to be assessed against a core set of accepted regulatory principles based on existing, well-established guidelines. This is about improving the quality of regulation in New Zealand. The bill aims to increase the transparency of regulation making and the accountability of regulation makers. In essence, the bill has three components. Firstly, it provides a benchmark for good regulation through a set of regulatory principles that all regulations should comply with. Secondly, it provides transparency by requiring those proposing and creating regulation to certify whether the regulation is compatible with the principles. Thirdly, it provides monitoring of the certification process.

We know that every New Zealander is affected by regulation in a number of ways. Some regulation is important. It helps us live safer lives, get treated fairly, protect and manage our environment, have a competitive and efficient economy, and much more. However, regulation also has costs and can have unintended effects. That is why improving the quality of regulation is a priority for this Government. We believe that better regulation and less regulation are essential to assist New Zealand to become more internationally competitive and a more attractive place to live and do business.

We are committed to introducing new regulation only when we are satisfied that it is required, reasonable, and robust. We will review existing regulation in order to identify and remove requirements that are unnecessary, ineffective, or excessively costly. In fact, since being elected, the National-led Government has begun a programme of reviews of the effectiveness of important regulatory regimes, particularly those that have a significant impact on productivity. We have simplified employment law. National’s employment law package encourages employers to hire new staff, reduces compliance costs, and gives greater choice around holidays. The voluntary 90-day trial period has created 13,000 jobs in small and medium sized businesses. We have extended this period to all employers.

We have simplified the Resource Management Act to balance our economic opportunities with our environmental responsibilities. We have simplified building regulation. Our Better Building Blueprint is making it easier and cheaper to build good quality homes and buildings. We are amending the Building Act to encourage a “build it right first time” approach, keeping builders accountable and streamlining the consent process to make it cheaper for homeowners.

Better and less regulation has made, and will continue to make, New Zealand more productive and prosperous. I look forward to the Regulatory Standards Bill coming to the Commerce Committee so we can discuss how this bill can improve the quality of regulation in New Zealand. Thank you.

CLARE CURRAN (Labour—Dunedin South): I am pleased to take a call on the first reading of the Regulatory Standards Bill. I too have listened to some of the discussion in the House this afternoon. As members no doubt know, Labour is opposing this bill. We support the principles of better and more efficient regulation and also good lawmaking. However, we believe that this bill seriously fails to meet and achieve this aim. It will create compliance costs for Government departments through the certification process and the annual report, and it blurs the line between the judiciary and the executive.

We certainly, as I said, stand for the improvement of regulation and lawmaking. Much of the work done by the previous Minister of Commerce, the Hon Lianne Dalziel, aimed to achieve that, and we are still seeing many of the bills that are part of that process coming before the Commerce Committee.

We are saying today that this is a confusing and ineffectual bill, which will not lead to better legislation, but will instead clog up the courts with cases arguing the meaning of vague principles. This bill fails its own proposed standard of clarity of legislation and will force the already over-encumbered judiciary to take on the role of policy analysis for all Government legislation. New Zealand lawmaking, although it could be better in some cases—in particular, the super-city legislation, for example—is generally already of a reasonably high standard, which makes this unnecessary and potentially very expensive legislation. This bill is a solution that is searching for a problem, and it is a poor solution at that.

The Hon Rodney Hide and the ACT Party tried to get this bill through Parliament before now, in the form of the Regulatory Responsibility Bill in 2006, but it was rightly rejected by the Commerce Committee as being overly complicated, unnecessary, and even unconstitutional. Now we have it back. The New Zealand Herald has described the bill as ill-considered, the Maxim Institute calls it a wolf in sheep’s clothing, and Treasury itself, in the regulatory impact statement, says it believes it would be ineffective and unnecessary. Constitutional law expert Richard Ekins, of the University of Auckland, went as far as to say that this bill is “hostile to our democratic constitutional order.” Why, then, is the Minister bothering to bring this deeply flawed bill back to the House?

I will read out some of the principles of the bill, in a nutshell. The bill sets out the principles of responsible regulation. It will apply to all legislation—including a newly and widely defined category of “legislative instrument”, derived from Australian federal legislation—to ensure that all instruments of the lawmaking or legislative character of central government, not merely administrative, are covered. It will provide a process for certifying that proposed new regulation is compatible with legislative principles, which will be done by those responsible for creating or administering it. It will provide a role for the High Court to declare whether a provision of any regulation is incompatible with one or more of the legislative principles unless, under clause7(2), the “incompatibility … is justified to the extent that it is reasonable and can be demonstrably justified in a free and democratic society.” For regulation made before the date the bill comes into force, some declarations may be made only after 10 years from that date.

The principles central to this bill are vague, they are based on a failed ideology, and they are legally suspect. There is a principle, under clause 7(1)(c), that no legislation is to “take or impair property” but, if it does, it must be necessary in the public interest and the owner will receive full compensation. As Brian Fallow of the New Zealand Herald has pointed out: “On the face of it this would debar Parliament from doing anything redistributive.” I will read another couple of quotes from his article of Thursday, 24 March: “It is what Yes, Minister’s Sir Humphrey Appleby called the politician’s syllogism: Something must be done. This is something. Therefore this must be done.”

He also said that “One of the Regulatory Standards Bill’s central principles against which legislation is to be measured, if taken literally, would tend to freeze the existing distribution of wealth. It says legislation should not ‘take or impair … property’ unless it is necessary in the public interest, the owner receives full compensation and that compensation is provided, to the extent practicable, by or on behalf of those who benefit from the taking or impairment.” As he said, “On the face of it this would debar Parliament from doing anything redistributive. That would depend on what content the courts gave to the concepts of taking, impairment, full compensation and the public interest. Those are just some of the concepts in the bill which it makes no attempt to define and delimit—leaving that to the courts.” That is why Labour is not supporting it.

I have another important point, and I would be interested to know from any future speakers from the other side of the House just what they will do in the future; I know they are going to support the bill to go to a select committee. Mr Fallow ended his article by saying: “The Government is only committed to supporting the Regulatory Standards Bill as far as select committee consideration. Labour is expected to oppose it. So it may well never see the light of … day.”

Considering the disdain that the Hon Rodney Hide has for the supposedly bloated Public Service, why is he introducing legislation that will increase the compliance and reporting costs of public entities? Treasury already carries out regulatory impact statements for new legislation, a mechanism the previous Labour Government improved to help ensure efficient and necessary regulation. With the new Productivity Commission also having some oversight in this area, any further legislation is completely unnecessary and a waste of the taxpayer’s money. Under this bill the relevant Minister and public entity will be required to undertake a certification process, with regular reviews and annual reporting by that entity. There is also the very real prospect of litigation by outside parties, if a judge is to make a declaration of incompatibility.

Considering that this Minister has continually proclaimed his intention to cut red tape, I cannot understand the rationale behind this bill, because it promises to significantly increase compliance costs for our already overstretched Public Service. The role of the judiciary under this legislation is of concern, as it will require those in the legal profession to become skilled at policy analysis with regard to regulatory law. Judges will be asked to interpret the poorly defined principles of this bill and how they apply to any new law. Because of the requirement of judicial oversight of all new legislation using these principles as the guideline, the judiciary will have incredible power over Parliament with regard to lawmaking and policy. The bill could politicise the courtroom as judges will be required to make political value judgments.

Initially, this legislation will apply to only new bills, but after 10 years existing regulation will be open to reinterpretation by the courts, and potentially we could see judges reinterpreting provisions in older laws to make them consistent with the principles of this bill. Is that democratic? It will essentially change the meaning of a law that was passed by a previous Parliament. I can already see some big corporates planning their cases to challenge regulations imposed under old law, and that process clogging up our courts further.

Labour is not opposed to improving the lawmaking process. We spent much of our last term improving legislative analysis through the regulatory impact regime, and the Hon Lianne Dalziel oversaw the Quality Regulation Review, which focused on improving regulatory barriers to business growth. This House has already passed the Regulatory Improvement Bill, the like of which will be passed annually to ensure regulation is efficient and necessary. We support good law, but we do not support this bill.

JONATHAN YOUNG (National—New Plymouth): I am very pleased to stand and speak to the Regulatory Standards Bill. Regulations are important. They balance private interests with public interests. Regulations are important to establish how our society interacts, how it coexists, and how it shares its resources in a fair way, which, as I said, enhances personal rights and opportunities without infringing on the personal rights and opportunities of others. Finding that balance is what legislative work such as this bill is about. But regulations can become outdated and become unnecessarily onerous. There are times when the construction of our legislation needs to be reviewed and there are times when we need to be looking at those regulations as well and bringing some changes to them. The Hon Rodney Hide and the Hon Phil Heatley in April this year looked at some areas of fisheries and aquaculture legislation and regulation and announced the removal of 176 unnecessary regulations from the law books. The Hon Mr Hide said that many unnecessary regulations were allowed to remain on the law books and legislation has not been updated to keep up with the times. It is important that we have these review processes.

I particularly like the principles of responsible regulation set out in this bill, and we have heard other speakers talk about these. Clause 7(1) states: “The principles of responsible regulation are that, except as provided in subsection (2), legislation should—(a) be consistent with the following aspects of the rule of law: (i) the law should be clear and accessible: (ii) the law should not adversely affect rights and liberties, or impose obligations, retrospectively: (iii) every person is equal before the law: (iv) issues of legal right and liability should be resolved by the application of law, rather than the exercise of administrative discretion:”. These principles underpin the creation of our regulations and our legislative process. They are our baselines. They are the foundation that gives boundaries and context to the regulations we create, to ensure they are fit for purpose.

The National-led Government is firmly focused on lifting New Zealand’s economic performance. Only by lifting our economic performance can we create jobs, boost incomes, improve living standards, and provide the world-class public services that Kiwi families need. National recognises that we need to address and remove, where possible, barriers to growth and things that will stop our businesses moving ahead and stop them continuing to grow and to develop. We believe that better regulation and less regulation is essential to help New Zealand become internationally competitive and a more attractive place to live and to do business. We live in a very competitive world, and it is very important that we do not place upon ourselves undue encumbrances of outmoded, outdated, and onerous regulations. This bill is moving towards the end of those sorts of unnecessary weights that hold us back and hold us down. I am very pleased to stand in support of this bill.

RAYMOND HUO (Labour): I would like to start my contribution to the first reading of the Regulatory Standards Bill by quoting some thoughtful comments made by leading legal experts and relevant stakeholders. Law commissioner and former chief statutory draftsman, George Tanner QC, says that the bill would fail to meet the test of responsible regulatory management, even based on the bill’s own principles. Auckland University’s Dean of Law, Professor Paul Rishworth, says that it could clog up the courts and draw officials into legal battles. New Zealand Herald commentator, Brian Fallow, says that the principles are abstract, constitutionally unorthodox, and substantively unsound. Even Treasury’s evaluation of the bill does not support it. According to Treasury, there is no clear advantage over other available methods in using legislation to promote regulatory quality, other than legislation being necessary to provide for the new role of courts. Further, Treasury rates the potential to induce change in behaviour as low, the risk of unintended outcomes as high, and the potential to reduce costs as very limited. No wonder Alex Penk, policy and research manager at the Maxim Institute, described the bill as a wolf in sheep’s clothing.

Labour opposes this bill. I have five main reasons for opposing this bill. The first one is that this bill changes the role of Parliament and the courts, and requires certification by Ministers and chief executives. This means that the chief executives in effect certify whether they would enact a particular law. The certification regime therefore virtually puts chief executives in the position to politicise themselves and arms them to veto Government policy in a way that is inconsistent with our constitutional arrangements. Secondly, the bill would be applied to new laws, but after existing for 10 years it can apply to existing regulation as well. This could empower the courts to reinterpret provisions in other laws to make them consistent with the principles prescribed in this bill, thus changing the original intention of Parliament when the law was enacted. Thirdly, many of the principles are redundant as they are provided for in other legislation—for instance, the imposition of taxes except by or under an Act, which is already the case. Therefore, the principles contained in this bill are ideological, vague, and create legal uncertainty. Fourthly, this bill will create not only legal uncertainty but extra compliance costs for public entities, which will now face more onerous annual reporting requirements. Finally, this bill aims to fix an exaggerated problem. The regulatory impact statement states that although New Zealand lacks its own indicators of legislative quality, the best international surveys available suggest that New Zealand does not have fundamental problems with legislative quality when compared with other OECD countries.

Looking at the content, the bill has three key components—firstly, certification; secondly, judicial declarations of incompatibility; and, thirdly, interpretation to ensure legislation conforms to those principles. The bill establishes a so-called benchmark for good regulation through a set of seven regulatory principles. All regulations, including primary, secondary, and tertiary legislation, excluding instruments made by local government, should comply with these principles. The bill aims to provide transparency by requiring decision makers to certify whether the regulation they are proposing is compatible with the principles. Finally, the bill provides a check on the certification process by allowing the courts to provide declarations of incompatibility, where they believe the principles have been breached. However, this power is declaratory only, with no direct ability to overturn or amend the offending legislation, which, luckily, is consistent with the separation of powers doctrine.

I have three further concerns. The first one is that the Regulatory Responsibility Taskforce failed to justify why this bill is even necessary. There is very little evidence to show why a vigorous or intensive approach is required, as opposed to the other options suggested by the Commerce Committee. Based on the calls from both National and ACT MPs, there is no convincing argument as to why legislation is required to ensure better legislation. The second concern is that the bill uses open-textured language that will lead to uncertainty of meaning. According to George Tanner QC, it attempts to define good lawmaking by reference to a set of simple principles, and in doing so it obscures the complexities inherent in them and creates the same lack of clarity and uncertainty that it seeks to prevent. My third concern is with regard to the role of the judiciary. Sir Geoffrey Palmer pointed out in a recent article that neither judges nor the legal profession are proficient in policy analysis of the type that leads to regulatory legislative proposals. In this respect, the bill actually confers on the judiciary a new role for which they are not equipped. Our already overburdened court system should not be further encumbered with overseeing regulatory legislation.

I had the pleasure of reading a well-researched article offered by a senior lecturer at the faculty of law of Auckland University. Richard Ekins argued that this bill is unconstitutional and authorises courts to review the detail of policy, illegitimately constraining Parliament and calling into question the validity of much secondary legislation. Of particular interest is clause 7(1)(b), which states that legislation should “not diminish a person’s liberty, personal security, freedom of choice or action, or rights to own, use, and dispose of property, except as is necessary to provide for, or protect, any such liberty, freedom, or right of another person:”. A substantial number of legislative Acts do actually diminish a person’s liberty or freedom of choice. Mr Ekins cited an Act entitled the Bakeshop Act 1896 (NY), which prohibits any person from employing another to work in a bakery for more than 10 hours per day, or 60 hours per week. That Act would depart from clause 7(1)(b) of this bill, for it restricts the freedom of contract of employer and employee, and is not necessary to protect any existing liberty or freedom of the employee or any other person. The legislators might attempt to justify the Act by reference to the health of the worker, or the need to protect him or her from economic exploitation. It would be open to the courts to consider this rationale, and to decide that the legislation is an unjustifiable limit on liberty. The article went on to say: “The bill also states, in paragraph (c), that legislation should ‘not take or impair … property’ unless this is necessary in the public interest; and full compensation is paid, such compensation to be paid if practicable by those who benefit from the taking.” Mr Ekins argues that the principle conflates “takings” and “impairment”: “The fact is that limiting how one uses property attracts full compensation. The point of the principle is to make it very expensive to limit how property owners may act, for any property owner who suffers loss from regulatory change is entitled to be made whole. Thus, if Parliament wishes to ban dangerous weapons, it must buy them.”

MELISSA LEE (National): It is a pleasure to rise to speak to the Regulatory Standards Bill in its first reading. New Zealand needs to lift its economic performance, and on this side of the House we are firmly focused on that. Only by lifting our economic performance can we better the lot of all Kiwi residents in this country, Aotearoa, by creating jobs, improving incomes for New Zealanders, improving living standards, and improving the public services that Kiwis actually deserve. This is especially so because New Zealand is a very small country. It is a small country compared with some other big countries, such as the United States, for example. We are at the bottom of the globe, far away from many of our trading nations. Hence, we are economically disadvantaged by being so far away, and we need to attract and retain the talent pool that is increasingly mobile around the world. We have heard about many Kiwis leaving our shores for better jobs overseas; we need to be able to retain them. We need to attract them and retain them.

Skills, technology, entrepreneurship, and capital are all things we need to grow so that our economy continues to grow. New Zealand needs to grow. Although the Opposition leader seems to think that our recession actually ended in 2009, we know how difficult it has been for most New Zealanders, and we need to improve the lot of New Zealanders. That is exactly what the National-led Government is doing.

To give us a competitive edge we also need a better policy environment than can be found anywhere else in the world. Cutting red tape and regulations is an integral part of this Government’s drive for stronger economic growth, making it easier for New Zealand companies to do what they do best. To help them along, the Government has put in place an annual programme to clean up regulation. It has simplified a number of laws—I think it was some 170 laws—and has established a Productivity Commission. It is not just businesses that are affected by regulation; everyday New Zealanders are also affected by regulation in all areas of their lives. We want regulations to help to ensure that we all live in a safer country, that we have safe lives, that we get treated fairly in this country, that we are all equal under one law, that we protect and manage our environment so that our children can also enjoy it in the future, and that we have a competitive and efficient economy that will achieve a better living standard for all Kiwis. We have already removed 170 unnecessary regulations from the law books, amended more than 20 Acts of Parliament, and are in the process of amending another 13 Acts.

The work of the Productivity Commission will also lift New Zealand’s economic performance in both the public and private sectors. Established in April this year, the two inquiries it will undertake are in housing affordability and international freight services. Both of these areas affect New Zealand’s international competitiveness. The commission will report back early next year, and I look forward to that.

The Regulatory Standards Bill has its origins as a member’s bill back in 2006, as previous speakers and the Minister for Regulatory Reform, who introduced the bill, have said. Although the Commerce Committee considered it back in 2008, it was deemed not ready to be passed in this House. I believe we should support this bill, because there needs to be transparency in regulation making. The accountability that this bill promotes is what we are doing, and what we do every day. I support this bill. Thank you.

A party vote was called for on the question, That the Regulatory Standards Bill be now read a first time.

Ayes 64

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

Noes 56

New Zealand Labour 42; Green Party 9; Māori Party 3; Progressive 1; Independent: Carter C.

Bill read a first time.

Bill referred to the Commerce Committee.

Bills

Courts and Criminal Matters Bill

In Committee

Part 1 Amendments to District Courts Act 1947

LYNNE PILLAY (Labour): It is a pleasure to take a call on the Courts and Criminal Matters Bill. We in Labour support this bill, but we do so with some concerns, obviously. It has been described by the Government as the most comprehensive set of measures in 12 years to strengthen the recovery of unpaid money. We do not think it goes anywhere near as far as that, and I think it is another indication that this Government is out of touch with ordinary Kiwis.

Hon Steve Chadwick: Totally.

LYNNE PILLAY: It is totally out of touch. The reason we in Labour support this bill, quite frankly, is that it results from the work that was started and went some way whilst Labour was in Government. Figures released earlier this year showed that between July 2008 and June 2009 the courts actually wiped $95 million of the total $806 million in unpaid fines. Those unpaid fines are increasing every year. Of course, it not only is a loss of revenue but also does not ensure accountability that fines are paid. That is very much a key focus of this bill.

We question why this bill took so long to come to the House. It was ready. In fact, I have seen many bills—many bills—go through this House that I would have liked to see take a step back rather than this one. This bill goes some way to doing some good, as opposed to a number of other bills that this Government has brought in that do nothing but cause harm—immense harm in some cases, as we see if we look at employment relations and some of the law and order bills.

I go back to this bill, because I know you would want me to, Mr Chair. This bill omits some proposals that were developed by Labour. For instance, one proposal that we had was to create a single agency responsible for the collection of those fines. At the moment, there are 80-plus issuing authorities. This is very cumbersome and it impedes the speedy collection of fines. It would have been very, very helpful if more work had been done. I hesitate to say it, but I think it was perhaps a little lazy to not put the effort into ensuring that there was a single agency. That would have certainly been a more effective way of collecting fines.

The Minister for Courts, Georgina te Heuheu, wanted to introduce a Supplementary Order Paper at the Committee stage to allow offenders convicted of a three-strikes offence but not warned of the consequences to further offending to be brought back to the court to be issued that warning at a later date. We did not support that. Perhaps that Supplementary Order Paper could have been avoided if the Ministry of Justice, rather than the police, had been the lead advisers on the Sentencing and Parole Reform Act in the very first place.

As I said, the bill makes amendments to the District Courts Act 1947 in terms of attachment orders. Those orders are used to allow deductions to be made from wages and benefits to pay debt. Certainly, when we look at penalties that accrue over time, we see that the sooner people can be put in a position—whether or not it is by an attachment order—to make payments on those debts, the better it is not only for the country but also for those people.

There was also some discussion on deputy bailiffs to clarify that a person who is appointed as a deputy bailiff may exercise the powers and perform the functions and duties of a bailiff in respect of any District Court, and not just in relation to a particular District Court.

In terms of employees being subject to attachment orders—I go back to attachment orders—it carries over the existing law that it is an offence for an employer to dismiss an employee or alter the position of an employee to the employee’s prejudice because, among other things, an attachment order in respect of the employee has been served on the employer. However, the new provision removes the existing onus on the employer to prove that the employer’s actions were not taken as a result of the employee’s debt or the attached order.

There are some changes around contempt proceedings and in terms of the driver licence stop orders. There are some amendments to the Land Transport Act 1998 regarding liable persons in terms of driver licence stop orders, which are, obviously, a very effective deterrent. The new measure means that liable persons are sent a warning notice. That warning notice is very important. It gives them 14 days to resolve their traffic penalties before their licence is actually suspended. Those driver licence stop orders will suspend all driver licences held by the person in default, including limited licences. It will also prevent people from obtaining a licence, including a limited licence, whilst that order is in place.

In terms of the process, following those orders all driver licences are suspended until the overdue traffic penalties are resolved through payment or a negotiated payment agreement, or until the penalty is substituted for an alternative sentence. If that person drives in breach of a driver licence stop order, which is a pretty stupid thing to do, then that vehicle will be impounded for 28 days. These measures are stern but fair, I would say. They go some way in terms of making the system fair but, more important, more effective—

Kelvin Davis: Stern.

LYNNE PILLAY: Stern but fair, as the former principal would say. I think that in terms of going forward this part certainly makes some positive changes.

In relation to superior priority of seizing property, the District Court can obtain higher priority over secured property of a credit provider if the loan was advanced when the overdue penalties could have been released under the credit reporting proposal. When that property is subsequently seized by the court, some or even all of those discoverable penalties are still overdue.

There are also changes around substituted sentences. The bill actually authorises prison or home detention sentences to be substituted for unaffordable and unenforceable payments. We would not like to see that. We hope that that happens very rarely and that the enforcement and payment of fines is more effective under these bills. I think we would all agree that subjecting somebody for unpaid penalties and fines does not serve any purpose if they are sentenced to home or prison detention, and that a far more effective way is to obtain those moneys and those penalties, either through payments or through a payment agreement.

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

JACINDA ARDERN (Labour): This is my first call in the Committee stage of the Courts and Criminal Matters Bill. It is my understanding that we are currently going over Part 1, which sets out the provisions on the use of attachment orders to allow deductions to be made from wages and benefits to pay debts. At present, attachment orders can be imposed only after an examination hearing to assess the debtor’s ability to pay the debt, and that hearing requires both parties to attend. This is an attempt to streamline that provision and the enforcement process by enabling judgment creditors to file a financial statement or ask the court to assess the debtor’s financial means in the debtor’s absence.

I will add a couple of extra questions that have been considered earlier in this area, I understand—or at least considered by the select committee—on the question of attachment orders to enable deductions to be made from wages. I remember at the select committee questioning whether this would unfairly impinge on, for instance, a small-business owner, if they would have to administer the attachment order on behalf of the debtor, and whether it would represent a considerable cost. This came to mind after I had seen similar provisions in the UK result in a significant burden on small-business owners in particular. It is just a question that we may wish to discuss during the debate on this part, but I imagine that, by and large, it will probably not be a great issue.

I am working from memory here, and perhaps a current member of the select committee can remind me of the arrangements for someone who is, for instance, on a benefit. A judgment might be made that an attachment order would be difficult for someone on such an income, but I guess there are separate questions that sit around that issue. I would be interested in the difference between administering such arrangements for a Work and Income recipient, for instance, versus a small-business employee.

I want to highlight, though, that this is a bill that Labour supports, and we do so because overall it enhances the court’s powers and processes for the collection of fines. We were involved in the development of the bill from the outset. I think Rick Barker was involved in this work, and I know this is an area he has always been very passionate about. One of the points I think he would raise is that we would like to see an overarching agency with responsibility for fines, and there is no provision for that in the legislation. The reason for calling for such an agency is just the proliferation of groups involved in the collection of fines. I believe that more than 80 issuing authorities are involved in issuing fines, and that plays some role in impeding the collection of fines.

What kind of an amount of money are we talking about? Figures released earlier this year show that between the period of July 2008 and June 2009, just in terms of unpaid fines, the courts wiped $95.1 million of a total of $806 million in unpaid fines. That is a huge amount—not only the amount that is being wiped but also in terms of unpaid fines. I know quite a bit of work has been done to try to improve the collection of fines, such as using the ability to stop someone at the border before they travel abroad. I do not have the statistics, but anecdotally I think there is probably a suggestion that that has been a successful campaign.

I am really interested in the psychology involved when someone accrues quite a large amount of fines they need to pay. I think the Ministry of Justice has looked into this issue—and rightly so, given its consideration of the wiping of debt. That research has shown that when people cross a threshold of money owed—and for young people it sits around, I think, the $2,000 mark—they become unable and even unwilling to even attempt to pay off their fines. So we get to a point where if we start adding anything on, it starts to become absolutely meaningless.

JACQUI DEAN (National—Waitaki): Thank you, Mr Chairperson, for the opportunity to speak in the Committee stage of the Courts and Criminal Matters Bill. It is a worry that surveys show that about $672 million in fines, which includes reparation, remains unpaid. I do not think that is a particularly fine figure. Surveys on the public’s perception of the courts have found that over half of respondents believe offenders can avoid paying their reparations or fines. That is not a good situation for those of us who wish to uphold the law, so into this Chamber comes the Courts and Criminal Matters Bill.

I have to say that the bill was considered by the Law and Order Committee before I was a member of the committee, but on reading this bill I find there are several very good aspects to it. I confine my comments to Part 1, which seeks to amend the District Courts Act 1947. The amendments are intended to improve the efficiency and effectiveness of both attachment orders and examination hearings. Attachment orders require mandatory deduction from wages and benefits in order to pay debts, and alongside examination hearings they are the most common and effective civil debt enforcement processes. However, to date they have been somewhat cumbersome, and have put a bit of a burden on those creditors who are required to attend hearings.

This bill includes provisions for judgment creditors to file a financial statement, which is a much simpler process to undertake than an attachment order, or indeed to ask the court to assess the debtor’s financial means in the creditor’s absence. My reading of this clause is that if someone is a creditor, they will not necessarily be required to go to a court hearing. I know that at the courthouses in my electorate on court days there are large numbers, regrettably, of people sitting out in the sunshine or whatever, waiting for their turn in court. Arguably, it is a waste of time, if someone is a creditor, to have to take time off work or their normal daily activities.

Part 1 is commendable, and when it is implemented I am pretty sure it will find favour with those creditors who find themselves unwittingly and unwillingly caught up in the court process. This whole bill represents the most comprehensive legislative improvements for the recovery of unpaid fines and civil debt in 12 years. I commend Part 1 to the Committee.

CAROL BEAUMONT (Labour): It is a pleasure to speak on the Courts and Criminal Matters Bill. It was dealt with by the Law and Order Committee prior to my membership of that committee, but I know it has general support, and certainly Labour supports this bill. As my colleague Jacinda Ardern has mentioned, development of this bill was commenced, in fact, under Labour. Credit goes to Rick Barker, I think, and I am pleased to see it acknowledged in the commentary that the work was begun under the previous Government. I think that is a good thing to note.

We are, of course, speaking on Part 1. Part 1 covers the amendments to the District Courts Act 1947. The bill is an omnibus bill so it covers a number of different Acts, and this part solely addresses the District Courts Act. The matters in this part relate to attachment orders, which allow for deductions to be made from wages and benefits in order to pay debts. The issue of debt is a significant problem in the current climate. It is not just about a whole lot of individuals who keep racking up fines and do not pay them. There are some people like that, I am sure, but also there are many people who are struggling very seriously to make ends met and who are incurring debt. Monetary fines as a punishment can, in fact, be very difficult requirements for some people to meet. One of the particular things about this bill is that it tries to look at alternative ways that people can make amends or meet the requirements of any punishment other than by paying fines.

This part is about attachment orders, which is about paying fines. The bill aims to streamline in this regard, as it does in others, the enforcement process by enabling judgment creditors to file a financial statement or ask the court to assess the debtor’s financial means in the debtor’s absence. That provision avoids the delays, the cost, and the inconvenience of bringing all the parties together to do that.

One of the things I was interested in—and I thought others on the Law and Order Committee at the time this bill was considered might be able to help me with this—was Supplementary Order Paper 202, which deals with attachment orders and proposes the carrying over of the existing law that it is an offence for an employer to dismiss an employee or alter the position of an employee to the employee’s prejudice because, amongst other things, an attachment order in respect of the employee has been served on the employer. That sounds sensible to me. If a person is complying and doing what they are required to do, they should not face the possible loss of their job, especially in times of very, very high unemployment, such as we are facing now.

As I understand it, the new provision removes the existing onus on the employer to prove that the employer’s action was not taken as result of the employee’s debt or the attachment order. In other words, it weakens that protection. I wondered why it does that. I thought that perhaps members of the Law and Order Committee could elucidate that matter and explain why the provision has changed and why the onus on the employer has been removed so that employers do not have to prove that their actions in dismissing somebody were not taken as a result of the employee’s debt or the attachment order.

The new provision consequentially removes the time limit for the protection provided to employees, which is currently 6 months. Again, I ask those members who were on the select committee to explain the reasoning behind removing that time limit for protection. Those are a couple of questions about attachment orders that I would very much like to know the answers to. Perhaps the Minister in the chair, the Minister for Social Development and Employment, might be able to help us out on that matter.

The Supplementary Order Paper also talks about imprisonment for the non-payment of fines. As I understand it, it carries forward the provision that the period of imprisonment imposed in respect of the non-payment of any fine, or where the sale of any property under the process does not produce sufficient proceeds to pay the fine, shall be such a period as, in the opinion of the court or District Court judge fixing the period, will satisfy the justice of the case. However, the period of imprisonment cannot exceed, in the case of an offence that was punishable by imprisonment, the maximum term of imprisonment to which the defendant was liable on the conviction, or a period of 1 year, whichever is the lesser, and in any other case a period of 3 months. It goes on to talk about that.

Another area in Part 1 that I thought was interesting—again, Supplementary Order Paper 202 relates to this part—was the proposal to amend the provision of the bill as introduced allowing a judgment creditor to apply to the District Court for the judgment debtor to be sentenced to community work as a sanction for non-compliance with the payment orders made by the court. I am assuming this is in a situation where somebody is really unable to pay the debt. The legislation provides another way for the person to actually meet their debt to society, if you like, so that we do not have a whole lot of people with substantial levels of debt in fines that they will never be able to pay off. It would provide an alternative: community work or other penalty is referred to here.

There is also a provision in Part 1 for property and goods to be sold by the bailiff. Again, Supplementary Order Paper 202 proposes that it be made clear that the purchaser of goods sold by a bailiff charged with the enforcement of a warrant to seize property acquires good title to those goods free of all ownership interests and other proprietary interests held in them before the sale. This particular part of Supplementary Order Paper 202 amends clauses 28 and 29, amending respectively sections 90 and 91 of the Act.

In closing, I would be very interested indeed to hear a little more about this issue of employees subject to an attachment order, why there has been a change to the existing law so that the onus of proof has changed, and why the time limit for protection has been changed.

Dr CAM CALDER (National): It is a great pleasure to rise to speak on Part 1 of the Courts and Criminal Matters Bill. Part 1, as we heard, involves amendments to the District Courts Act 1947. The whole purpose of this omnibus bill, which amends a number of statutes, is to enhance the courts’ powers and processes for the collection of fines and other monetary penalties and civil debt. We realise, of course, that most New Zealanders, if they err, do pay their fines, but there are a number who do not, and this bill is designed to deal with that rather significant problem.

Part 1, as I said, involves amendment to the District Courts Act 1947. The principal amendments are to Part 6 of the Act, involving enforcement of judgments, and these amendments are designed to improve civil debt enforcement processes. The civil enforcement system can be complex, cumbersome, and costly for all parties. It generates high levels of tension and frustration among users, and attachment orders, which entail mandatory deductions from wages and benefits in order to pay debts, are the most effective civil debt enforcement option.

Currently, an attachment order can be imposed only after an examination hearing has been held to assess the judgment debtor’s ability to pay the debt, and both parties have to attend the hearing. Part 1 amends the District Courts Act to provide greater flexibility in enforcement processes, particularly in the establishment of the said attachment order, gathering information on a judgment debtor’s means to pay the debt, removing geographic restrictions, and modernising service provisions.

I would like to mention briefly the concept of attachment orders and what we are attempting to do here. Clauses 13 to 18 amend a number of provisions in the District Courts Act that deal with attachment orders. These orders will be able to be issued following application for an attachment order and the filing of a financial statement or a financial assessment being undertaken. Unlike other enforcement options, attachment orders will be able to be issued immediately after a court judgment or order has been made, and this will expedite the process and reduce costs to the parties.

Another important aspect of this amendment bill is the removal of geographic restrictions. The amendment removes geographic restrictions to allow court processes to be undertaken at any District Court, rather than at the specific local court. Clause 10 inserts new section 79A to enable a judgment to be enforced in any District Court, and clause 8 repeals section 69, which regulated the removal of a judgment from one court to another. Clauses 5 to 7 make the necessary consequential adjustments to the powers of registrars, deputy registrars, and bailiffs respectively. This is done, once again, for the convenience of the parties involved.

I commend this part to the Committee.

RAYMOND HUO (Labour): Kia ora, Mr Assistant Chairman Robertson. Before I start, I acknowledge the great work done by the Hon Rick Barker. I also thank the National Government for carrying on the great work initiated by Labour while in Government. I agree with my colleagues Lynne Pillay and Jacinda Ardern, who, in their earlier speeches in this Chamber, both said that Labour would like to see one overarching agency with the responsibility for fines. But there is no provision for that in the legislation, and that is regrettable.

Part 1 amends the District Courts Act 1947. Under this Act attachment orders are used to allow deductions to be made from wages and benefits in order to pay debts. At present, attachment orders can be imposed only after an examination hearing to assess the judgment debtor’s ability to pay the debt. Both parties are required to attend the hearing, which can be inconvenient and incur delays and costs. This bill aims to streamline this enforcement process by enabling judgment creditors to file a financial statement, or to ask the court to assess the debtor’s financial means in the creditor’s absence.

The Law and Order Committee received 15 submissions, and I acknowledge the great work done by the officials. They have done a tremendously good job. Some of the submitters commented on the changes to attachment orders. Those in favour of the changes commented that the changes would create better outcomes for creditors. The opposing view was that those changes had the potential to create a situation where attachment orders were imposed at a level that was unsustainable, and that could be potentially imposed without a debtor’s knowledge. One concern, in particular, was that an individual could be subject to enforcement action without being aware of that, as a result of the removal of these requirements.

Another issue was the change to the service provision, and some submitters commented that the extension of the service provisions to enable creditors to complete a service more efficiently would result in a more expedient enforcement process. Others were concerned about relying on the presumption of service, and about the weakening of the current service provisions. Thank you.

KRIS FAAFOI (Labour—Mana): Taloha ni. I understand that Part 1 of the Courts and Criminal Matters Bill amends the District Courts Act 1947. The substantial provisions in this part basically change the way that attachment orders for the collection of fines from salaries and benefits can be processed by the courts. My understanding of the current situation is that it needs both the creditor and the debtor to have an assessment as to whether the debtor can pay the fine, but the substantial provision in this part changes that so that the creditor can ask for an assessment to be done by the court as to whether the debtor is able to pay that fine. As many speakers on this side have said before, we support Part 1 because it will streamline the process for those who are expecting some money, especially those in the civil debt arena, to know whether they can be paid.

Part 1 will also address the huge problem that we have with unpaid fines. It is a big problem. I believe that in the year July 2008 to June 2009 there was around $800 million of unpaid fines, and the Ministry of Justice had to write off around $90 million of that. So Part 1 will, hopefully, go some way to addressing that problem by streamlining the process and by making sure that those who have transgressed and have been asked to pay a fine will fulfil their obligations as asked by the court, as soon as they possibly can. If they are not able to pay their fine, then that will be assessed and we will know soon enough so there is not the level of frustration for those who are owed money. I guess that would be a very frustrating position to be in if one was expecting some money from an individual or organisation that had been fined for a transgression, but then had to go through this process, which could be strung out because previously both parties had to be present at a hearing to get an attachment order. Part 1 will now streamline that process to make sure that a proper assessment is done of a fined person’s ability to pay that fine.

Although Labour supports this part of the bill, there are some omissions that my colleague Jacinda Ardern alluded to earlier that we thought could have been included in Part 1. One of those omissions was a single agency to be responsible for the collection of fines. We understand that at the moment there are 80-plus issuing authorities for fines. With unpaid fines being in the region of $800 million over the 1-year period I mentioned, if we had one unitary body that was responsible for fines then we might do a better job of collecting most of those unpaid fines. As I said, 80-plus issuing authorities have responsibility for fines. Although Labour supports Part 1, we believe that it could have gone a little bit further in terms of making sure there was a much more streamlined process for the collection of those fines.

As Jacinda Ardern also alluded to earlier in this debate, there is a problem with young people in terms of the level of fines that they are starting to receive where it becomes impossible for them to begin addressing it. That level is around $2,000, and we can imagine how difficult it is at the moment for these young people to do the basics like pay their rent, pay the bills, or even get a job. We can imagine how difficult it would be to be stung with fines in the region of $2,000. It would be a mountain to climb to pay off that debt. I am pretty sure that any of those young people who face that kind of debt from the courts would like a much more streamlined process, or at least to have some way of their being assessed as to whether they could pay it. If we are talking about a level of $2,000 for young ones at the moment, I think most of them would struggle to pay off that debt.

I think this bill goes a long way to making sure that there is a process there for them. If they owe money to the courts, there is now a much more streamlined process so that that process is not strung out for them. It is not a burden that has to be carried by them for a long period of time. Thank you.

LYNNE PILLAY (Labour): In rising to take a call on Part 1, I acknowledge Rick Barker who did so much work on the Courts and Criminal Matters Bill whilst Labour was in Government. I know that his commitment to justice and to the court system is certainly second to none. It is a wonderful opportunity to acknowledge all the good work that he does. The fact that he is the chief whip has nothing to do with that, and I look forward to seeing Rick Barker taking the call in the very near future.

I want to talk about contempt proceedings. Just to recap very quickly, when I last spoke I talked about how unfortunate it was that the Government did not bring all of the collections under one agency. That was Labour’s intention, and I think that would have been much more efficient and effective. Having said that, Labour still supports this bill.

I also spoke about deputy bailiffs. I clarified that a person who is appointed as a deputy bailiff can exercise the powers and the functions of a deputy bailiff in any District Court, not just in relation to the particular District Court.

I now move to the contempt proceedings in Part 1. A debtor can be sentenced to community work or another penalty for non-payment of debts. The proposal is to amend the bill as introduced, allowing a judgment creditor to apply to a District Court judge for the debtor to be sentenced to community work as a sanction for non-compliance with payment orders that have been made by the court—that is, when the court has gone through that process. That allows the court to impose any of orders, including ordering the judgment debtor to do community work.

It also authorises judges to decline an application from a creditor for contempt proceedings on the papers if that judge is not satisfied that the debtor can afford to pay the debt and is refusing to do so. If there is a case where the debtor does not have the means to pay, then that can be taken into account.

Removing the requirement for an application for contempt proceedings to be supported by an affidavit setting out details of the debtor’s alleged disobedience and also authorising registrars to issue warrants to arrest judgment debtors who fail to appear at the hearing of the application or who cannot be served with the application will go some way to effectively ensuring that debts get paid. The bill makes provision for the sanctions that we spoke about before, the ability of the orders to pay, and also the driver licence stop orders, which I will not speak about at length here, because they are in Part 2.

The purpose of the bill is to improve the process and address a general concern about the amount of overdue fines, the satisfaction of victims when offenders do not comply with orders and make payments to those victims, and the sheer frustration of creditors and debtors using the court’s civil debt enforcement process. Although this bill does not go as far as we would have liked, it does go some way to improving the collection of fines in our court system. For that reason, Labour is supporting this bill.

The question was put that the amendments set out on Supplementary Order Paper 244 in the name of the Hon Georgina te Heuheu to the proposed amendments set out on Supplementary Order Paper 202 in her name to Part 1 be agreed to.

Amendments to the amendments agreed to.

The question was put that the amendments as amended set out on Supplementary Order Paper 202 in the name of the Hon Georgina te Heuheu to Part 1 be agreed to.

Amendments as amended agreed to.

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

Ayes 111

New Zealand National 58; New Zealand Labour 42; ACT New Zealand 5; Māori Party 4; Progressive 1; United Future 1.

Noes 10

Green Party 9; Independent: Carter C.

Part 1 as amended agreed to.

Part 2 Amendments to Land Transport Act 1998

Hon RICK BARKER (Labour): I will talk about Part 2, and in particular about driver licence stop orders for the non-payment of fines. We have a longstanding problem in this country of drivers who continue to drive, seemingly with impunity, while having a large number of outstanding fines. Previously there was no means of reconciling that; no means of connecting the privilege of driving to the number of fines that people had.

This issue came to a head when I received a letter from someone I knew whose mother had been badly injured in an accident. He had gone to court and the young driver was charged with careless driving. During the court hearing it somehow came out that this person owed $42,000 in outstanding fines and had a very long list of other issues. The letter writer said to me: “Surely someone must have known that this young man was a menace on the road. This young man’s driving was erratic, this young man was driving against the law, and he was an accident waiting to happen, and it was my mother who was the one who had the accident. Why are the people in authority not taking effective action against these young drivers?”. It was a good question, it was a fair question, and the question was right on the button.

This measure of driver licence stop orders seeks, in part, to address that issue. It says to people who accumulate an excessive number of fines that if they do not take responsibility for them, do not pay them, and do not learn the lesson of their bad driving behaviour, their licence will go—no question about it. I think this is a very powerful message to send.

It is one that is long overdue, and there were some technical problems about getting it introduced, in terms of the legislation. There were technical policy problems that took some time, and it was whilst I was in Government that a lot of the work was done. I am very pleased to see that the Hon Georgina te Heuheu and this Government have introduced this legislation, because it is long overdue.

I do not know where the change of attitude has come from, but there was a time in this country when, whenever anybody got a fine, the first thing they did was to front up to the court and pay it. One did not have outstanding debts. That was the nature of who we were as a people, but somehow over a generation or two we have lost that belief. Some people have this view that they can simply have outstanding fines to the Crown, and it is of no consequence whatsoever.

This legislative change says that that time is over. There will be a consequence, it will be swift, and it will be very effective. Everybody knows that if they get caught driving without a licence, they will be in even deeper trouble.

The message in this legislation to those who incur fines is that they should pay them, or the State will take effective action against them. They are given the privilege of driving on our roads. The roads have rules for the safety of others, and those people, as drivers, are obliged to follow those rules. If they do not, there will be effective action taken against them.

The second bit, which I think I have missed—in part because I was distracted—but which I want to speak to briefly in the Committee stage, is about the change in the credit that people have. This issue runs in a similar line to the one about driver licensing and outstanding fines.

A number of young people have their cars—quite expensive cars—and for whatever reasons they have a pile of debts against them, and they get their cars confiscated. The very first thing they do is to go to a car yard that will sell finance to them, and they finance the fines back into the car. The person who lends them the money knows that there is a substantial amount of money outstanding to the State—not directly, but they know who these people are and what they do—and they finance the car. When the car is seized by the Crown, the person who gets the money first is the finance company, under the old arrangement. So the finance company is more than happy to sell them the car on finance because they know that if it gets confiscated, it is going to get its money back, and the Crown can wait in the back of the queue.

This legislation will change the priority so that when a car is confiscated and sold, the first priority will be the payment of fines. We will do this by making sure that the information about people’s debt is available to those finance companies. If the finance companies sell a car with finance to a person who has outstanding debts to the Crown for outstanding fines, they will know that they are second in the queue for the money, and that the priority for receiving that money will be the Crown. I think this will be a substantial handbrake on those people making decisions about selling cars to people who are irresponsible with their vehicles and the way in which they drive and accumulate fines.

So there is a pincer movement here. The pincer movement in this legislation is, firstly, that if any outstanding fines are left unattended, a person will lose his or her licence. The second part of the pincer movement is that we will attack their ability to finance themselves into a car if their car is stolen.

We will do this with a very serious intent. Our serious intent is to say to the person who wrote the letter to me some time ago about his mother being injured by someone who had a massive list of outstanding fines that we took the matter seriously. Yes, I say to the person who wrote the letter, we should have known that that person was a menace on the road, and we should have taken action against them. This legislation does that in two ways. I think in all good conscience that I can then, sometime in the future, say to the person who wrote the letter that their matter was taken seriously, it was heard, and it was done effectively.

A number of the finance companies tried to quibble with this legislation by saying that the Crown was somehow using its superior weight and power to go past them and to get the money first. Well, I want to say to them that sometimes one has to have a batting order. Someone is No. 1 batsman, someone is No. 2, and someone plays at three, four, and five. The Government is entitled to set the batting order. It is entitled to do so not only for its own interests but also for the interests of the community and the people who drive on the road.

This change in priority is to signal to those people that the Crown takes this seriously, and our priority is not to stop people getting financed—we do not want to do that—but to say that if a person has a huge number of outstanding fines, he or she should not be treated in the same manner as a person who has no outstanding fines. We want to say to the person who has a huge list of outstanding fines, and to the people who want to finance them into a car and put them back on the road, that they cannot do that with impunity, and that they risk their money. That is because the person they are selling a car to, and financing into a car, is a liability—a liability measured by the number of fines incurred and the number of outstanding fines not paid.

This Parliament is entitled to take a dim view of that. This Parliament is entitled to act, and act decisively, and we do so. I think this is very good legislation from that point of view. It is here to serve the public interest of those who drive on the road, and it is not necessarily here to be about collecting fines.

Let us deal briefly with the issue of collecting fines. I know it is beyond the ambit of this legislation, but the point needs to be made that if people do not want fines, they should not speed. If people are complaining about the Government and the State using fines as a collection mechanism for finance, well, the simplest way to cut down the income flow is to not speed and to not break the law. I am sure this country would be very pleased to see its revenue from infringements for traffic offences fall to zero, because if it fell to zero we would have a law-abiding citizenry.

Some may see a fine for speeding as simply a tax; a tax imposed for the privilege of speeding. Well, I say to them that if one speeds, one has to pay a fine. I must admit that I have had a few speeding tickets; Triumph motorcycles sometimes have a mind of their own, I must say, but I do my best to control it. I have had fines, and I readily accept that if I have broken the law and sped, then I have to pay the fine—I have no problem about that. But one does not always do it wilfully and wrongly. However, the fact is that I cannot blame the State for my getting a fine; I blame myself, and I have to take responsibility for myself.

I just want to commend this legislation and say that Parliament has done fine work here.

STUART NASH (Labour): My colleague Rick Barker has outlined a lot of the rationale behind the Courts and Criminal Matters Bill. We live in a society that is based on fairness. If there is one thing I have learnt about New Zealanders, it is that we do not ask for much at all, but it really annoys us if we think we are being treated unfairly or if people are getting away with stuff that they should not get away with. This is why I really back this measure, and I back my colleague Rick Barker and the words that he has said. Traffic fines are imposed for a reason, which is that the driver has broken the law. As Rick Barker said, and as many of us know, we can read in the paper about characters who get arrested for something, and they have, as Rick said, $40,000 worth of fines—or it might even be $400 worth of fines. But they act as if they are immune from the law. It is simply not good enough in this day and age to run roughshod over the law, to have no accountability and no responsibility, and, actually, to treat the law with contempt. I think the bill deals with that pretty well, actually.

The process under which a driver licence stop order must be served is actually quite robust. There is no excuse—there is no excuse whatsoever—for people to say no one had told them about it, so they did not know, because what happens first of all is that a warning is served. I will let people know where we are at. I am talking about new section 91AB, to be inserted by clause 43, “Ways in which warning notice or driver licence stop order must be served”. This is a legislative requirement. What must happen is that an employee or an agent of the Ministry of Justice—so we are talking about a policeman or a bailiff, I assume—must deliver the notice personally to the defendant, or, if the defendant refuses to accept it and all reasonable care has been taken, they may deliver it to the defendant’s place of residence and give it to another person who appears to be over the age of 14. This is a warning—this is a warning. That is what can be done; it can be left at the place of residence.

These people are under no illusion that they have been given a warning. But then they have the ability to pay. They have a warning, and there is a decision to pay up when they realise they need their licence, perhaps for work. The person has done wrong and must pay up, because that is the person’s contribution to society, and it is about taking responsibility. It is about time that some of these people took responsibility for their actions. They have 14 days.

Dr Cam Calder: This is a National Party line, Mr Nash. Come on over.

STUART NASH: Believe me, I say to Mr Calder, the Labour Party believes in individual responsibility more than the National Party. We believe it is about time that people from the very top, whether they are dairy farmers paying tax or whether they are people who have broken the law on a motorbike, took responsibility for their actions and paid up. People have 14 days. Someone who has received a warning has 14 days to write a cheque—let us hope it does not bounce—pay the fine, and there it goes. The stop order will not take place if the fine is paid. There will be no problems whatsoever, which is only fair.

But after 14 days, if people have not paid up, if they have not accepted responsibility for their actions, then the imposition of a driver licence stop order can be made. It actually says in new section 91D(1): “… the chief executive of the Ministry of Justice may impose a driver licence stop order”. To tell the truth I would have liked to see the “may” be changed to “must”, because “may” implies there is no legislative requirement there for the Ministry of Justice to impose a stop order; it just says it is within the ministry’s discretion. “Must” means that there is a legislative requirement, and I think that would have sent a very strong message. There would be no excuse then. There may be a little wriggle room in new section 91D, because when the 14 days is up there will be the question of whether the period should be taken out to 15 days—maybe that is the reason for “may”. But I think it is really about time that people started to take responsibility. I do not know how much money is outstanding. Perhaps the Minister in the chair, the Hon Jonathan Coleman, one of the other National MPs, or even one of my colleagues will be able to tell me how much money is actually outstanding in motor vehicle fines.

Jacqui Dean: $672 million.

STUART NASH: That is outstanding? What is that for?

Hon Member: Yes, it is outstanding.

STUART NASH: That is unbelievable—$672 million. That is why I would have liked to see a “must” here, because there should be a legislative requirement. Thank you.

KRIS FAAFOI (Labour—Mana): Taloha ni, Mr Chair. I am grateful for the opportunity to speak to Part 2 of the Courts and Criminal Matters Bill. I hope that this part will, as my colleague Stuart Nash mentioned in his contribution, change the attitudes of drivers.

Far too many drivers are racking up all these fines—I think I heard just a few minutes ago that $672 million is outstanding—and far too many simply do not care about the fines they are racking up. I mentioned in my earlier contribution the level to which young drivers get themselves into a spot of bother in terms of not being able to pay some of their fines. With $672 million outstanding for fines, I hope this bill changes the attitude of those drivers who have a significant amount in unpaid fines racked up in their name and under their licence, and who do not care at all whether that is paid off.

I want to talk about an experience I had in my own electorate when I spent a night with the traffic police about a month ago. We pulled over a young driver on the main road. I will not do anything to identify him at all, but when he was pulled over—

Michael Woodhouse: That’s lucky for Rick!

KRIS FAAFOI: It was not a motorbike, so it was not—

Stuart Nash: He said “a young driver”.

KRIS FAAFOI: It was a young driver. He only just passed the breath alcohol test, and after some investigation into the computer system it was found that he had a significant amount in unpaid fines under his name. His licence was suspended as well, which was another issue, and he would have been pinged for something else, not necessarily under this bill. His attitude to the fines was that he could not afford them, they were too much, and he would keep driving until he was caught—as he was that night.

That kind of driver is someone whom this part will address, because of those attitudes. We need to make sure that if people have a significant amount in unpaid fines racked up under their name, there is a process through which they will be, I guess, frightened into making sure that those fines are paid.

As Stuart Nash said in his speech, there is a robust process covering how these driver licence stop orders are imposed on drivers who have significant amounts of money outstanding with the courts. This bill sends a message to those drivers that unless they make an arrangement to pay off some of their fines, they will be taken off the streets, and if they do not take any action themselves to pay them, the courts will take action against them.

As Stuart Nash said, there is a period after a warning is issued in which people have 14 days to sort themselves out. If they do not make an arrangement to pay the fine, do not pay the fine at all, or do not take any action at all, these stop orders will be imposed on them. After that, if they do not act, they will be suspended and will stay suspended until they take some action. It is my understanding that the licence will be taken off them and, unless they make some kind of arrangement to pay off the fine, they will stay suspended. They will not get back the licence until they have made the payment.

There is also the ability under this bill for cars to be impounded for 28 days. I think that is a positive move. These people who are flouting the law with absolutely no regard for the fact that they owe money should have some serious action taken against them.

As I said, it is an attitudinal change we are trying to address in those drivers who do not care that they might have a number of outstanding fines against them. Along with the fines goes behaviour. These people obviously do not care about the fact they owe a significant amount of money, and for the most part they are probably some of the ones who are acting dangerously out on the roads, because they have racked up a significant amount of trouble through the fines they owe. Along with streamlining the process in Part 1, this Part 2 takes action to change some of the attitudes of those drivers who have racked up these fines, who do not care, and who flout the authority of the courts to take action against them through fines.

This is a positive move. As I say, $672 million is a large amount of money outstanding. We support this move to try to get some of those fines back into the coffers.

CAROL BEAUMONT (Labour): It is a pleasure to speak to Part 2 of the Courts and Criminal Matters Bill, which, as others have said, is about amendments to the Land Transport Act 1988. In particular, people have focused on the provisions on driver licence stop orders. As others have said, we think this is a very sensible provision. It inserts a number of sections into the Land Transport Act to authorise the imposition of these driver licence stop orders. It will mean that people can have their driver’s licence suspended if they have not made arrangements to pay overdue traffic penalties.

It is important to note that that measure was not seen as the penalty in itself. The driver licence stop order is not a penalty in itself, as in some overseas regimes, but an incentive for the proactive resolution of overdue traffic fines. I understand that similar schemes have been operating in Australia and have been working successfully. It is always good, I have to say, to find examples of similar jurisdictions where something has been tried out and we can weigh up whether it is beneficial. That is a very positive thing and it is good to see that we have been able to pick up this idea.

The measure has the following features. A warning notice will be given to people so that they have 14 days to resolve traffic penalties before their licence is suspended. Hopefully that will give people a major jolt. Living as I do in Auckland, I say that being without a car in the current environment of limited public transport options would make life very difficult. Most people are still, I am afraid to say, reliant on their car to get to their workplace and therefore to earn the income they need to live on. That is, of course, if they are lucky enough to have a job; sadly, too many Aucklanders and too many New Zealanders do not, because of the unemployment situation and the lack of Government action on jobs.

I come back to Part 2 and its amendments to the Land Transport Act to allow for the suspending of driver licences, including limited licences, held by people in default. So, on the point I was making about work, this would also suspend licences that people in other situations might get to be able to travel from their home to their workplace and back. Those would also be suspended, and people would be prevented from obtaining a licence during the time they were subject to the driver licence stop order.

The good thing is that if the person pays the overdue fines, their driver licence will be immediately restored to them, unless during that period it expires, and then obviously they will not have a licence at that stage. Importantly, a person driving in breach of a driver licence stop order will have his or her vehicle impounded for 28 days. Again, that is quite a stiff penalty, and I think it will make people think seriously about whether they will infringe.

One of the things I thought was quite interesting was that apparently members of the Law and Order Committee were interested in the advice of the New Zealand Police, and the fact that its policy was to waive infringements for expired warrants of fitness, or outdated registrations of 1 month or less, when the fault was remedied in a timely manner. The committee felt that that policy of compliance incentive—encouraging a person to go and get their warrant of fitness or registration—was a very good practice.

I agree with that. I think that the committee is absolutely right on that. Apparently, the same is true for parking infringements, although I do not quite understand how that works. Somebody who was on the committee might like to tell me.

I understand, though, that a difference of opinion came about on this matter, when the Labour members wanted to use the legislation to regularise the waiver policy we have just talked about. That seems like good common sense, but unfortunately it seems that that idea was opposed by the National members. I believe they went on to signal, though, that they might advance such a provision in future legislation. We would certainly like to ensure that that happens, because it seems a very sensible policy to give people that little shove or incentive, if you like, to become compliant.

These changes to the Land Transport Act 1998 are actually quite significant ones. They are quite well structured, and they also provide fairly major signals to people about the seriousness of paying their traffic fines.

I noted earlier that my colleague the Hon Rick Barker, who, as others have noted, played a very major part in this Courts and Criminal Matters Bill, and who deserves congratulations for that, has had traffic fines, as have I. It would be interesting to hear about the experiences of others.

LYNNE PILLAY (Labour): Along with my colleagues, I will stand and take a call. As we in Labour have said, we support this Courts and Criminal Matters Bill, although we are disappointed that it is not as comprehensive as it would have been, had all the recommendations that Labour put forward come into effect.

I will also talk about driver licence stop orders, because that is what Part 2 is about. Along with my colleagues who have talked about those orders, I think that they are really important, and a very good and effective way of addressing the new measures in terms of the non-payment of fines. What will happen is that liable persons will be sent a warning notice, which will give them 14 days to resolve their traffic penalties before their licences are suspended. That is very sensible.

I note from the select committee’s report that 69 percent of debtors are aged between 20 and 39 years of age. Members have not made any mention of the fact, but I would probably put money on it that the vast majority—certainly, a majority—of them would be men. Given that 69 percent are within that age group, improving compliance for the payment of penalties is a very sensible and desirable thing to do; if nothing else, it will set people on the right track, so that they do not have penalties or debt just continuing to stack up because of some misdemeanours. Those infringements may be for parking, speeding, or any of those sorts of offences that have led to fines.

Under the process, if a warning notice is served by any means other than personally on a defendant, the service will be deemed complete only after the driver’s licence card has been returned to the Ministry of Justice. If, for example, a driver licence stop order was served electronically, and the defendant failed to return his or her licence card, or to make arrangements to pay the fine—either by paying the fine itself or by making a fine payment—then that driver licence stop order could be reissued and personally served on a defendant by an authorised officer. So it is a very appropriate way of dealing with what is a very real problem.

I know that Kris Faafoi talked about the amount of $672 million in unpaid fines. That is a substantial amount, and, goodness me, what a lot of good could be done with that. We could certainly see the reinstatement of early childhood education funding, and a number of other things.

Melissa Lee: $1.4 billion in early childhood.

LYNNE PILLAY: Maybe the Government’s contribution to KiwiSaver could be reinstated—goodness me, we have a little bit of interest from Melissa Lee over there. Perhaps with that sort of money we might not see the slash-and-burn approach to housing in New Zealand. That is certainly an astronomical amount of money to be tied up in fines, but to see it tied up in unpaid fines is really, really terrible.

I think it is very appropriate that we support this bill. I think that the driver licence stop order will be a very effective tool, which in a worst-case scenario will lead to tougher sanctions in terms of cars being impounded, etc. It is a good step towards getting people on the right path to taking their debts seriously, so that that debt does not continue to grow and ruin their lives.

STUART NASH (Labour): I have a couple of questions on Part 2 of the Courts and Criminal Matters Bill. They are really practical process questions, and I would not mind if the Minister in the chair, the Minister of Immigration, answered a couple of them.

I will talk about new section 91C, to be inserted by clause 43, “Warning notice to be served on defendant”. It may interest people in the gallery, or wherever they are watching, that initially this provision was called “Warning notice to be sent to defendant”. But the Law and Order Committee changed it to read “served on defendant”. The interesting part is what was crossed out. New section 91C(1) initially concluded: “by delivering it to the defendant or by sending it to the defendant by ordinary post or by electronic means.”, but the select committee obviously decided that that was not a robust enough system to ensure compliance, or to ensure that defendants could say, with hand on heart, that they had received this message. An opening was left for someone to slide on through and deflect his or her responsibility. As I was saying before, this is all about accepting responsibility.

There are a couple of practical issues here that I would not mind the Minister answering, because they are quite significant. We have heard that there is $672 million in outstanding fines. That is an astronomical amount—$672 million in outstanding fines. But we have also heard—again, this comes down to new section 91C—that now that warning notice has to be served on the defendant. I am assuming that a policeman or a bailiff has to go—well, it states it in the bill—to the person’s place of residence and hand the person that notice. If the person is not at his or her place of residence then the notice has to be handed to a person over the age of 14, and if the person refuses to accept that notice it has to be proven that the official reasonably tried to deliver it. So there is no excuse for not having it delivered. New section 91C(3) actually states that “No driver licence stop order imposed on a person is invalid merely because a notice … was not received by that person or was received …”, but that is beside the point.

My question is how will that actually be done? If $672 million is outstanding, we are talking about a lot of people. How will this process be resourced? Will the police dedicate a certain team of people? I assume it is all retrospective, as well. If someone has a fine outstanding as of now, once this bill is passed into law then that person will be liable for one of these driver licence stop orders. They do not know when they will get them. I wonder whether the Ministry of Justice has a process in place or has a suggested time line on how long it will take to police this. How long will it take to get the resources needed to deliver every single one of these notices to the perpetrators’ places of residence, and sign off and say that they have been delivered?

I also would not mind knowing what the payback is. Let me give an example. The Inland Revenue Department has estimated that for every $1 spent on debt collection it gets back about $62. The department chases hard. That is not a bad rate of return, we must admit. When we questioned the Minister of Revenue in the last Finance and Expenditure Committee he said that $62 might be a bit high and that it might be closer to $35 or $40. But it does not matter. If we are spending $1 and getting back $35 or $40, that is an amazing rate of return. I wonder whether the Ministry of Justice has done a similar analysis for this process. For every $1 it spends issuing notices or chasing outstanding fines—$672 million of them—I wonder what sort of return it will get.

The reason I ask is that it comes into the benefit-cost analysis. If the ministry puts 10 people on to serving this, will 10 people over the space of a year be able to recover $50 million or maybe even $100 million? I am not too sure. This is simply a lot more than putting a letter in the mail to the person and saying: “OK, in 14 days you’re stopped.”

As my colleagues Rick Barker and Kris Faafoi have outlined, there are many instances of young men and women—well, I assume there are some older ones as well—who believe they are immune. They believe that they can drive and it does not matter. They will get pulled up, they will get a ticket, and they will keep driving. That is simply not good enough because, as we said, it is about taking responsibility. But I am assuming—and I could be wrong—that if a young man, like Kris Faafoi in the example he gave, is pulled over by a policeman—

Lynne Pillay: You’re a young man like Kris Faafoi.

STUART NASH: —OK, let us not the stretch the truth here—and it is proven that he has $10,000 worth of outstanding fines, is the policeman allowed to issue a warning on the spot? That would make it easier. That would make the process a lot easier. As Kris Faafoi said, the man was not drunk under the legal definition. Legally what happens is that the policeman or policewoman issues an infringement notice, and the offender drives off. What do they do with that ticket? Well, $672 million worth of outstanding fines shows that they rip up the ticket and throw it in the back seat. They forget about it until they are pulled up next time, or perhaps until we find them and they can go to court. They get a fine in court, but they go out, keep driving, and keep committing these offences. It is simply not good enough.

Are the police allowed to issue a warning on the spot, there and then? Obviously a name has to go on the ticket. After 14 days the policeman will register the ticket, and then the Ministry of Justice can go around and take the person’s licence off them or impound their car, which I think is a very sensible solution. This guy has $12,000 worth of fines, so take his car, for goodness’ sake. He has to take responsibility for those fines. These people have broken the law. That is what our democracy operates under.

I ask the Minister in the chair, the Minister of Agriculture, to give us a bit of an idea how this process will be policed, and the sorts of resources that will be put into it. This thing will have no teeth. We all support it—well, I do not know whether the Greens do—but it will have no teeth if it is seen as just another piece of legislation on the law books to be filed away, without the necessary resources to chase it up and follow it up. That is what is absolutely necessary. That is what will send the message. If a guy walks along to a drag race and all his mates ask where his car is, and he says that the police came around and the new enforcement team they have in place came and took his car, his mates will say: “Oh, goodness me. That’s rough.” All his mates will have fines, and if that is not enough impetus then it will happen to the second chap and the third chap until these young offenders start getting the message that they have to take responsibility for their fines, for the $672 million worth of fines outstanding.

There are some resourcing issues. This system will not have the teeth that we want it to have, it will not have the consequences or the outcomes that we would like it to have unless the police have the ability to issue something on the spot or the Ministry of Justice diverts some resource into it. A benefit-cost analysis would be good; I assume the ministry has done it. It may well allow it to up the staff and up the resource. As I said, for every $1 spent the Inland Revenue Department collects about $40, and I suspect it is just as high with this system. It may even be higher. It is not as if we are chasing fraud. We are chasing people who have committed an offence. It is there in black and white. We do not need to take them to court. They have been to court, they have been issued a fine, and there it is. But that is a slight concern I have—it is a concern I have.

I think members have heard that every Labour member supports this bill. It is a really good measure—it is a good measure. We are talking about $672 million. As my colleague Lynne Pillay said, we would not have to sell a power station if we got in $672 million. We could have early childhood education back, or even night classes. But I think everyone agrees it requires extra resourcing; there is no doubt about that. There could be more jobs, maybe through the Youth Guarantee scheme, but I suspect they will have to have a little bit of training in this area.

It is good law. There are a couple of questions that I would not mind the Minister answering. Thank you very much.

Dr CAM CALDER (National): I move, That the question be now put.

CHRIS HIPKINS (Labour—Rimutaka): I am happy to take a brief call on Part 2 of the Courts and Criminal Matters Bill, which deals with the introduction of driver licence stop orders. It is a part that I support. I think it is a useful initiative that will certainly help to collect overdue fines.

I do want, however, to draw the Committee’s attention to a comment made in the Law and Order Committee’s report on this part. I quote from it: “The committee was interested in the advice of the New Zealand Police that it was their policy to waive infringements for expired warrants of fitness or for outdated registrations of one month or less where the fault was remedied in a timely manner.”

I am particularly interested in that comment, which is all to do with overdue fines, because effectively it says that in New Zealand we have a 7-month warrant of fitness. In fact, we do not. We have a 6-month warrant of fitness or a 12-month warrant of fitness, depending on the age of the vehicle. I have always been under the impression, so this was a surprise to me, that the obligation was on the owner of a vehicle to have the warrant of fitness renewed before such time as it expired.

This bill is saying that we can extend the life of the warrant of fitness by an additional month by simply running the risk that if we get caught, then whip our car in to get a warrant of fitness the next day, we will get away with not having renewed the warrant of fitness.

Jonathan Young: No, you don’t; it’s retrospective. They don’t start from that day.

CHRIS HIPKINS: Warrants of fitness do start from the day they are issued. Jonathan Young is a little mistaken. Registration is different, but a warrant of fitness takes effect on the day on which it is issued. This policy that is in place by the police now effectively tells people to take the risk and wait until their warrant of fitness is a month overdue, then go and get it. If people get caught in the interim period, they will be able to whip their car in, get the warrant of fitness, and be deemed to have remedied it, and the fine that they might have otherwise received will be waived.

I think that sends the wrong message to people. I think responsible vehicle owners should make sure their vehicle has a current warrant of fitness. If we want to say as a Parliament that the vehicle warrant of fitness should be for 7 months, then let us change the law and say that it should be for 7 months. It is not; it is for 6 months. This policy that is in place by the police, and as mentioned by the select committee, effectively gives a 7-month warrant of fitness. I think that is something the Committee may want to give some attention to.

I move back to the driver licence stop order, which allows somebody’s licence to be effectively taken away if the driver has outstanding fines. I think that is a useful thing. I was concerned, when learning of this, however, about how it can apply to a limited licence—to somebody who relies on their licence for work. How will this impact on them? We could see a situation in which someone gets themselves into debt, they have a licence for work, and suddenly that licence is taken away and they cannot earn any money. Therefore, how do they earn the money to pay the fines in order to get the licence back again?

I was reassured by the comment from the select committee that the person involved did not necessarily have to pay all of the fines; they needed to enter into an arrangement for the payment of the fines. Had it been the other way around, I would be very reluctant to support this bill, because I think it is really important that we do not rob somebody who has got themselves into a bit of financial difficulty with outstanding fines of the means to earn the money to pay those fines back.

A person might get themselves into that difficulty and that vicious cycle, and they might have all these outstanding fines and suddenly find that their licence has been taken away, but, providing that they negotiate an arrangement over time to repay those fines and the debt that they owe, they will be able to get their licence back. I think that is really important, otherwise we run the risk of giving ourselves more difficulty in collecting the fines than we have intended to, with this particular part.

The other thing that is really important is that people are sent a warning notice giving them 14 days to resolve their traffic penalties before their licence is suspended. I think that is really important. Again, we have this issue now whereby somebody is caught, they have received these fines, and they are given 14 days, first up, to sort themselves out. Even if they do not, and they lose their licence after that period of time, they still have the option of entering into a repayment arrangement, at which point, if they do that, they can potentially get their licence back, as I read it.

If I am mistaken on that point, it would be useful to have that clarified, because I think it is quite critical, and it is certainly part of my comfort with the bill, and one of the reasons for supporting it. If that is not the case, I would certainly like for that to be pointed out to me.

Overall, I can see the value in this provision. It is a good bill.

Hon RICK BARKER (Labour): I will make just a couple of points on Part 2 of the Courts and Criminal Matters Bill. I will follow up on the point made by Stuart Nash, then come back to the point made by Chris Hipkins. Stuart Nash pointed out that the clamping of vehicles is a very effective means of getting fines paid. This legislation strengthens that means. I bring to the attention of the Committee Ministry of Justice analysis that was done on the amount of outstanding fines. It found that there was a significant group who owed significant amounts of outstanding fines, who had very expensive cars, and who had the means to pay their fines, but they chose not to because there were no consequences. The moment there was a consequence, the fines were paid.

I have a couple of classic examples from the Ministry of Justice. One example was when a very expensive new Mercedes-Benz was clamped in Auckland with a substantial amount of fines outstanding against its owner. The moment the wheel clamp went on, the chequebook came out and the fines were paid. Similarly, the Ministry of Justice found itself temporarily in the possession of a very flash Italian car—a brand well known to many, with a prancing horse on it. It was also clamped, and I say to members that a chequebook moved faster than the car was capable of ever travelling. The fines were paid. This person had the money, there is no doubt about it, but they ignored the fines because they felt that they could do so with impunity. Well, the wheel clamp is out and those with outstanding fines have got the message loud and clear. I think it will work a treat.

I think the point that Chris Hipkins made is a problem that we have in the way in which we register and warrant our vehicles. It is also an issue that I do not think this legislation addresses as well as it could have. Fines should be used in some ways to change behaviour, rather than to penalise. The difficulty we create by making our cars’ warrants of fitness contingent upon having a registration means that for a number of poor families it is very difficult to find the money for a lump-sum payment for the registration. If a car is unregistered, it cannot get a warrant. This is a coupling of the two things. There was a strong discussion within the Law and Order Committee that we should give people the opportunity to clear their outstanding registration and warrant of fitness, and on at least one occasion to not suffer the penalty of a fine. The select committee was not of a mind to do so, on the basis that the police and the local authorities told the select committee they had a policy that if a registration or warrant was outstanding by a month, and if it was a first offence, they would give people the opportunity to rectify it and they would not incur the fine.

Only one local authority had that advice clearly marked on its website. It was clearly understood that this was the policy of the councils, but it was hidden. The select committee was assured by the territorial authorities that the policy was active and alive, and that they would action it. I put on the record for this Parliament that the select committee will come back to look at this matter in the future. I think it is important that when people have overlooked, as it is quite easy to do, the registration of the motor vehicle and its warrant of fitness that for the first offence—for repeat offenders there is no excuse—some leniency should be given. We were given an assurance by all of the parties that that leniency would be given. If it comes to my attention and the attention of the select committee that this is not the case, and that the policy is not being applied fairly and evenly, then I think it would be time for Parliament to act. Parliament would be asked to change the law, because I think it is a pretty tough thing.

I had in my office on one occasion a young solo parent mother, who had virtually no money. She had been in Napier with an unregistered and unwarranted car, got tickets for both offences, went back to Hastings, and got a ticket for both offences again on the same day. It was a substantial amount of money and there was no attempt by any of the authorities to waive either ticket. I felt that to be deeply offensive—two tickets for the same offence on one day. The poor woman had to then go to the courts. She asked to be able to make an on-time payment, and was told no. She was told by the local authorities no and by the police no. So she then had to let the debt go into the hands of the court, and she incurred a $30 fine on each of them and had to enter in a time to pay. This is another problem that we have to resolve somehow, in some way, because for a number of people the substantial fine is simply too much to pay off at the time, and we should give them the opportunity to pay.

So there are two unresolved issues here. The first is the ability to waive the fine to change behaviour. I think that is a good principle. It is one that is supposed to be in policy and in practice; if we find it is not, it will come back to be legislated for. The second issue is to give people the opportunity to pay as they go, according to their means. I do not think that is unfair or unreasonable. With that, I conclude my remarks and say that I support this legislation.

JACQUI DEAN (National—Waitaki): I move, That the question be now put.

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

Ayes 67

New Zealand National 58; ACT New Zealand 5; Māori Party 3; United Future 1.

Noes 53

New Zealand Labour 42; Green Party 9; Progressive 1; Independent: Carter C.

Motion agreed to.

The question was put that the amendments set out on Supplementary Order Paper 244 in the name of the Hon Georgina te Heuheu to the proposed amendments set out on Supplementary Order Paper 202 in her name to Part 2 be agreed to.

Amendments to the amendments agreed to.

The question was put that the amendments as amended set out on Supplementary Order Paper 202 in the name of the Hon Georgina te Heuheu to Part 2 be agreed to.

Amendments as amended agreed to.

Part 2 as amended agreed to.

The CHAIRPERSON (Lindsay Tisch): We now move to Part 3, debate on clauses 51 to 77 and schedule 2. The question is that Part 3 stand part.

Part 3 Amendments to Summary Proceedings Act 1957

Hon RICK BARKER (Labour): If I have this part correct—I am just flicking through it to make sure I am correct—this is the part that enables the disclosure of the amount of money that is owed to the Crown by people who have fines outstanding. This is another part of the legislation that will put pressure on fines defaulters to pay. When we examined what was happening with outstanding fines, it became clear that there were a number of people who had significant assets who could pay their fines but refused to do so because there were no inherent problems with it. The amount of money that they owed to the Crown was effectively secret. There was no knowledge of it. This was quite different from the debts that they owed in the private sector. All the information about a person who had an outstanding student loan, owed monies to the bank, owed monies to a finance company, or had however many other debts in the private sector would be available to any potential creditor, but the amount of money the person had outstanding to the State was not. The unintended consequence of this was that people would pay off their private sector debts in preference to their debt to the Crown. Once a person had paid down their private sector debts, it had a positive influence on their credit rating. A person’s credit rating could, therefore, be manipulated.

I felt, and others felt, that there was an imbalance here, in conjunction with the changes that we have made to disclose the number of outstanding fines to finance companies. Also part of it was the disclosure of the outstanding balances that people had in fines in general. When people were then looking at their debt, if the amount of outstanding fines was disclosed as well as their other debts then this would change people’s attitude towards paying off their court fines. It seems in the current structure that there is no pressure to pay fines because it does not affect one’s credit rating. There is pressure to pay off one’s credit card bill because that affects one’s credit rating, but there is no pressure to pay fines because it does not affect one’s credit worthiness. By disclosing this information, we are now putting another pressure point on people who have outstanding fines. There are extra and improved rules for clamping vehicles, the driver licence stop order, demerit points for unpaid fines, and the other rules are about the disclosure of credit. This again shows that Parliament is serious about people who do not pay their fines. I think the message must be very clear.

The public has the impression that the system somehow does not care about debt to the State. All members of Parliament would have received letters or submissions from people, saying “What about these outstanding fines? What are you doing about it?”, how bad it is, and so on. All of that is true, but the problem has been one of our own creation. Parliament has created this situation because the amount of fines that people have outstanding is effectively hidden and undisclosed until it reaches the courts and comes out in public. We need to put pressure on people to make them pay. This is a third pressure point on people to make them pay.

I think it also goes back to the point I made earlier about the person who wrote to me about his mother who was injured in a car accident, because the system took no effective action against the driver who had outstanding fines. I think disclosure is a very good idea. A number of people have complained about it, because they say there are privacy issues here. People say that their debts to the courts, to the Crown, should be private. Well, I say no, and I think this Parliament should also say no. If a person racks up a substantial amount of debt, yet does nothing about it, does not enter into an arrangement to pay with the Ministry of Justice, takes no action, and believes that they can leave their fines and do nothing about them, and can do so with impunity, then this legislation tells them to think again.

When these debts are disclosed—and they can be $20,000, $30,000, or $40,000—and people go to the bank to get a mortgage for a house, they will suddenly find that they cannot get the money. If they try to get a loan from any other facility, they will suddenly find they cannot get the money because of their debt to the Crown. I think this is a very good thing. In the past, debt to the Crown was undisclosed and it had no impact on credit worthiness. I believe that if a person’s debt on a credit card can affect their credit worthiness, then their debt to the Crown by way of fines should also have an equal impact on their credit worthiness.

This is the issue that is at stake here. I see the Minister has an amendment to this bill to change some of the requirements in it, and from looking at it I think we will support that. I report to the Committee that the Law and Order Committee had an extensive discussion with the Privacy Commissioner about these issues and the means of them, and there were quite a number of concerns, but the select committee was at pains to address all of the issues of the Privacy Commissioner. Issues were also raised by the Regulations Review Committee. It had quite a number of issues to raise with us, and with the assistance of Ministry of Justice officials we managed to resolve all of those issues, as well.

Although there were some privacy issues, in my opinion the amendments that have been made to the legislation have addressed those concerns and we now have in place a regime where if an individual thinks that their debts, by way of traffic fines and speeding fines, will go unnoticed, the message from this Parliament is for them to think again. They should think again because it will affect their ability not only to carry a driver’s licence, but also to get credit. I think this is a very good thing. I say to those people who rack up these extensive debts and do little about them that this Parliament cares about it. The State will use all the tools it can to get its money, not because it wants to be owed this money; it is money from fines that people have incurred because of the way they drive. Parliament will make sure that they are held to account by every means possible. I think this is a very good message for this Parliament to send, particularly to those people who in the main have the means to pay but simply choose not to. As I said in debate on the previous part, when someone’s car was clamped, the cheque was found immediately. They did not pay the fines because they did not feel any pressure. Well, there will be pressure from now on. Thank you.

LYNNE PILLAY (Labour): I am really happy to stand and speak, and I congratulate Rick Barker on a very good speech in terms of Part 3. Part 3 is a very, very important part of the bill. I know that Carol Beaumont agrees with me and will probably take a call on this, as well. In terms of credit reporting, the bill proposes that the penalty balance of eligible people via credit reporters would be able to be disclosed using an automated information-matching system. We all know that with knowledge comes power, and the ability to have this scheme for overdue penalties would be very, very helpful.

This scheme will not include overdue penalties subject to court orders relating to name or identity suppression from either the Youth Court or the Family Court. It will also not include people whose penalties are not overdue, including those subject to a payment plan, so that good behaviour will not be punished. If there is a process in place to pay back those penalties, then the people concerned will not be part of the credit reporting scheme. The Ministry of Justice is authorised to use the information to collect those fines. This will lead to efficiency, and the amount, which I forget—the hundreds of millions of dollars in outstanding fines—will go a long way towards getting back so much of the money involved in unpaid fines.

The bill requires the Minister for Courts to consult with the Privacy Commissioner before recommending any regulations implementing the exchange of information between the Ministry of Justice and the credit reporting industry. I think that is a very sensible move. Although it is important to get to the bottom of the issue of making that information available, it is also very important to comply with people’s rights and entitlement to privacy.

As I have said in an earlier speech, this part also authorises prison or home detention sentences to be substituted for repayments that are unaffordable and unenforceable. That move would be very regrettable and I do not think that anyone in this Chamber would see it as a positive move, but in situations where the debt cannot be repaid it does come down to accountability, as my colleague Stuart Nash said. People in these instances are quite clearly breaking the law, and it is very important in our democracy that the law is upheld. Although the ability is there for that substitution to be made, I, along with everyone else, I am sure, hope that that will not be a frequent occurrence.

There is also an amalgamation of all the existing provisions relating to seizures, which have been reordered to better align with the more up-to-date seizure process. In what I think is a very progressive move, arrangements can now be made to have longer times to pay fines or make payments by instalment. There is no point in insisting that a defendant pay a debt if there is utterly and completely no ability for that person to pay. This measure would give the ability for the court, rather than to make the order itself, to direct a registrar to determine whether it is appropriate to enter into an arrangement with the defendant to allow a greater time to pay that debt or fine, upfront or by instalment. It could be paid by a mixture of both, so that there could be an upfront payment and payments, as affordable, in instalments. That is a very sensible move in the long term or medium term, and it will go a long way towards clearing debt.

We have already identified that 69 percent of people affected are between 20 and 39 years of age, and this change means that those people have some hope of making their repayments. It is a win-win situation, not only because the debt can be cleared by the person, and will not become a black mark against his or her character that is available to be viewed through credit reporting agencies, but also because the money can be retrieved. If it takes a longer time to retrieve it, so what? At least that money is being retrieved.

There is a provision in the bill whereby the registrar will also have the power to take action if the fine is not paid or if time payment arrangements are cancelled. This provision sets out actions that a registrar may take if a fine or instalment is not paid, or if an arrangement extending the time available to pay the fine or attachment order is cancelled. I ask the Minister in the chair, Christopher Finlayson, to take a call on that issue. It would be very interesting to hear about it because, having not been on the Law and Order Committee, and certainly not being the Minister in charge of the bill, I would really like to know how that would work. I would like to know whether there is the ability for people in hardship to voluntarily go into that arrangement, or to request that arrangement from the registrar. I am uncertain about that, but I am sure that Chris Finlayson, with his sharp legal expertise and ability to explain things, will be able to enlighten the Committee on that issue. He is certainly not backward in coming forward to show off his intellectual abilities in terms of the law. I must say that I have at times heard some quite smart things come from him. He is a little bit remiss and backward in terms of the Sentencing Council; that was always something that saddened me, as the former chair of the Justice and Electoral Committee. But I can see that the Minister is getting ready to spring to his feet and answer the questions I have asked, and I think the Committee will be very appreciative of that.

There are a number of other aspects to this part, but I really would rather focus on the most important aspects. As I said, the credit reporting, the prioritising of seizing a property, and substituted sentences are all important. I did not touch on streamlining, but the infringement system under the Summary Proceedings Act has been amended to improve the operation of the system, court collection, and enforcement processes by looking at the inconsistencies there, in order to make the whole operation more effective and efficient, thereby delivering a benefit, again, in receiving and collecting the moneys that are owed.

Along with my colleagues, I am very pleased that Labour is supporting this bill, even though we know that it has not gone as far as recommended, and despite all the work that was done under the Labour Government prior to this legislation. As I have said earlier, I do not want to be too churlish but I feel that it is a pity the bill has taken so long to come to the House, especially when I can see all the hard-working officials sitting in the Chamber. I know they will be very relieved, because the bill has been languishing on the Order Paper for quite some time. Thank you very much.

CHRIS TREMAIN (Senior Whip—National): I move, That the question be now put.

CAROL BEAUMONT (Labour): It is a pleasure to talk on Part 3 of the Courts and Criminal Matters Bill. As others have mentioned, amendments are made to the Summary Proceedings Act 1957. Part 3 is a fairly substantial part of this bill. Quite major things are covered, including quite a large area that covers “Service under this part”. Another large area covers default balances to certain authorised persons, which are the credit reporting provisions that a number of recent speakers have talked about. There is a huge area on seizure release and sale of property, so there is quite a lot in this part of the bill.

I will talk about two things, first of all the bit that my colleague Lynne Pillay talked about, which is the credit reporting element. This is about the release of overdue penalty balances of eligible people to the private sector credit industry. The Hon Rick Barker, when he spoke earlier, made particularly good points on the fact that debt to the Crown was perhaps harder to ascertain than debt to private sector organisations, and that did not seem right. This part deals with that. It provides for a credit reporting scheme. Importantly, it does not include those people whose penalties are not overdue, including those who are subject to a payment plan.

I think, as Chris Hipkins said, it is very important that people who are finally taking responsibility for paying back the fines they owe, and who have come to some agreed arrangement, should not be further penalised. We all know that at the moment it is tough for people to make ends meet, and people can easily get into debt situations. The important thing is that they come to an agreed payment plan where they are paying back that money. It is important that that arrangement is specifically precluded from this credit reporting scheme. The Ministry of Justice is authorised under the bill to use information from credit reporting agencies, such as updated addresses and so on, to collect fines.

I was interested in the bit about the Privacy Commissioner. The Hon Rick Barker mentioned this bit, as well. The bill requires the Minister for Courts to consult the Privacy Commissioner before recommending any regulations that implement the exchange of information between the Ministry of Justice and the credit reporting industry. When I look at this bill, I see that this was quite a significant matter that was dealt with by the Law and Order Committee, and the Regulations Review Committee had quite a lot to say about this.

It has been interesting as a new member of Parliament to see the role of the Regulations Review Committee. It seems to me that it is very important that—

Aaron Gilmore: Hard-working committee.

CAROL BEAUMONT: I have to agree with the member opposite. It is very important work and somebody needs to keep a very close eye on the powers that are given to make regulations. As I understand it, the Regulations Review Committee expressed concern that the regulation-making powers in this part potentially had a high policy content, which could infringe on the right to privacy. Select committee members also felt that it would allow regulations to be made that could override the general provisions of the Privacy Act. Consequently, the Law and Order Committee clearly thought quite long and hard about this, and this part requires the Minister to consult the Privacy Commissioner before recommending any new regulations to the Governor-General. That provision was further strengthened by amending clause 69 to require the Minister for Courts to be satisfied that any proposed regulations are consistent with section 92B of the Summary Proceedings Act.

The committee went a step further and amended section 92A of the Summary Proceedings Act by amending the definition of “recognised user”. When I look at section 92I(1), in clause 69, I see that “The Governor-General may, by Order in Council made on the recommendation of the Minister for Courts, make regulations for …”, and then there is a lengthy list of things. So it seems to be quite important. Some of those things include quite serious matters, including prescribing the period for which fine status responses may be retained or used by recognised users and subscribers, and requiring the destruction of those responses on the expiry of specified periods.

It is really important, I think, that individuals have the confidence that although they have some responsibilities—and this bill is about making sure people fulfil those responsibilities to pay fines for things they have done—they also have rights, and there is some balance. I think that quite a lot of thought has been given to this matter by both the Regulations Review Committee and the Law and Order Committee in trying to get that balance right. It is quite a lengthy provision, and I think good work was done by the select committee.

The select committee did not go as far as the Regulations Review Committee would have liked. The commentary on the bill states: “We do not propose adopting the Regulations Review Committee’s suggestion that the bill be amended to require confirmation by Parliament of any regulations made under subparagraph (h) that overrode the general provisions of the Privacy Act relating to the use and disclosure of information.” I think committee members tried to take account of the concerns and they came up with some reasonably robust provisions, but they certainly did not go as far as the Regulations Review Committee would have liked.

The other thing I found interesting in this part is the bit about “Service under this Part”. It is not something I know a great deal about, but I was quite interested to see how extensive the provisions were. It talks about the various ways that a document can be served. It can be personally, by mail, electronically, or anything else. Interestingly enough, it has a whole section, section 79B of the Summary Proceedings Act, “Mode of service under this Part modified in special cases”, inserted by clause 58. I wondered what they were.

They include situations where somebody is served who is “living or working on board any vessel (including any vessel belonging to the Royal New Zealand Navy), by an authorised process server delivering the document to the person on board who at the time of service is apparently in charge of the vessel:” So it even goes as far as talking about serving notices on ships, and to members of the New Zealand armed forces, although there will be fewer of them, of course, as we have seen major cuts in our Defence Force. But none the less, those who remain may have something served on them by delivery of the document “at the barracks, camp, or station to the officer for the time being in command of the unit or detachment to which the recipient belongs:” It was interesting to see just how detailed this legislation is with regard to the service of these documents and the way it is done in special circumstances, some of which I have just outlined.

Finally, an area in this part that is quite significant is called the super-priority seizing of property. The District Court can obtain higher priority over secured property of a creditor provider if the loan was advanced when the overdue penalties could have been released under the credit reporting proposal and when that property is subsequently seized by the court, some or all of these discoverable penalties are still overdue. Lenders, for example, can check registers, and so on, but the court will retain a higher priority over secured property. I did not go into a lot of detail in looking at that bit, but I am interested in hearing more about the super-priority that is provided in Part 3, which I have been speaking about. Thank you.

Dr CAM CALDER (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 67

New Zealand National 58; ACT New Zealand 5; Māori Party 3; United Future 1.

Noes 53

New Zealand Labour 42; Green Party 9; Progressive 1; Independent: Carter C.

Motion agreed to.

The question was put that the amendments set out on Supplementary Order Paper 244 in the name of the Hon Georgina te Heuheu to the proposed amendments set out on Supplementary Order Paper 202 in her name to Part 3 and the following amendment in the name of the Hon Simon Power to the proposed amendments set out on Supplementary Order Paper 202 in the name of the Hon Georgina te Heuheu to clause 69 be agreed to:

to omit proposed section 92I(1)(ea) and substitute the following paragraph:

“(ea) requiring recognised users to take all reasonable steps to ensure that a query subject’s driver licence number (if any) or driver licence card number (if any), or both, are obtained from the query subject by or on behalf of the recognised user each time a fine status query is submitted:”.

Amendments agreed to.

The question was put that the amendments as amended set out on Supplementary Order Paper 202 in the name of the Hon Georgina te Heuheu to Part 3 and the following amendment in the name of the Hon Simon Power to clause 69 be agreed to:

to omit new section 92I(1)(c) and substitute the following paragraph:

“(c) prescribing the procedure, requirements, or other matters in relation to the cancellation of access codes, including the circumstances when access codes may be suspended immediately pending their proposed cancellation and the opportunity for submissions in that respect are required to be given to the recognised user concerned:”.

Amendments as amended agreed to.

Part 3 as amended agreed to.

Part 4 Amendments to other Acts

LYNNE PILLAY (Labour): To be consistent, I will take a call on Part 4 of the Courts and Criminal Matters Bill, which is the final part in the bill. As such, it amends a further 13 statutes, and that is quite a considerable number. Although most of the amendments are minor and ensure consistency amongst all the statutes, they are also very important amendments. Although Part 4 is not controversial and one could almost say it is quite tedious—the Minister in the chair, the Attorney-General, is nodding—it is still vitally important. If these amendments are not made or are incorrect, then this legislation will be inconsistent with the other statutes. I cannot imagine what it would be like to do that work. I do not think I would have the patience, and I know that Maurice Williamson would not. But for those who do have the patience, those with an eye for detail—probably like the Minister in the chair has—then that is really, really valuable work. It is work that never really receives the full recognition that it should have. Many other amendments are really interesting and make substantial changes to improve legislation. In this case, the bill affects the collection of fines. Part 4 is more about making sure things work properly: technical amendments, to ensure consistency.

What are the amendments to other Acts? There is an amendment to the Children, Young Persons, and Their Families Act 1989. The amendment repeals the old definition of “traffic offence” and substitutes a new definition, which adds references to a number of transport Acts, and any offence under them will constitute a traffic offence. So that is a very important amendment. There is an amendment to the Customs and Excise Act 1996 to change the definition of “fine”, for reasons of consistency. There is an amendment to the Family Courts Act 1980. There is an amendment to the Personal Property Securities Act 1999. New section 167A(2) provides that a registrar of the High Court or of a District Court may enter in the register a financing change statement in certain circumstances prescribed in the amendment. Again, in order to make things work properly, it is very important that the Act be amended.

There is, of course, an amendment to the Prisoners’ and Victims’ Claims Act 2005; we are getting more into current times. That adds an Order in Council provision in the section relating to the deduction of money for legal aid and for reparation, etc. The Privacy Act 1993 is amended, and we note the requirement for the registrar to consult the Privacy Commissioner in certain instances. There are amendments to the Railways Act 2005. Who would have thought that that Act would need amendment? Again, that is why it is really important to acknowledge the work that gets done in these instances, because that matter has been picked up on. God forbid if the Railways Act was inconsistent with this legislation! There are amendments to the Sentencing Act 2002. Goodness me, that is my old favourite. That Act is amended to authorise a court to direct that an offender can be detained for up to 2 hours to complete a declaration of his or her financial capacity. That is really important, because as previous speakers, including myself, have said, when we are looking at these outstanding fines and getting them sorted, it is really important to establish whether the person has the financial capacity, the ability, to make the payments. The Social Security Act 1964 has also been amended, as has the Tax Administration Act 1994 and the Transport Act 1962.

All of those Acts have been amended, and all in all there are 12 of them. But that is quite mysterious, because it states in the bill that 13 statutes have been amended. I am counting them again, but I can find only 12. Perhaps the Minister in the chair, the Minister of Justice, will take a call and enlighten me. I will go through them. I have the Children, Young Persons, and Their Families Act 1989, the Customs and Excise Act 1996, the Family Courts Act 1980, the Immigration Act 1987, the Personal Property Securities Act 1999—that is fine—the Prisoners’ and Victims’ Claims Act 2005, the Privacy Act 1993, the Railways Act 2005, the Sentencing Act 2002, the Social Security Act 1964, the Tax Administration Act 1994, and the Transport Act 1962. That is 12 statutes. It is just one of those things, and it is annoying.

What is that other Act? I suspect that some people in this Chamber know, and I will ask them. Does the Minister know? If he knows—and I can see that little gleeful look on his face, and that he is feeling kind of proud—he will be able to jump up to take a call and enlighten the Committee about that other Act. In the absence of that information, I wonder whether perhaps we have been given misinformation. Although that would be very rare, perhaps we have. If anyone in this Chamber can enlighten us, it would be a lovely finish to this bill, which does have majority support, although not from the Greens. It would be very good to find out about that pesky missing statute. Imagine if I were to turn the page and it was just on the other side, but it is not.

Hon Steve Chadwick: The Minister has nearly got it.

LYNNE PILLAY: The Minister in the chair, the Minister of Justice, is scribbling frantically; I think he has found it. I would have a lot of respect for him if he could find it.

Hon Member: His officials know.

LYNNE PILLAY: The officials know. They might be able to give him the word. Poor old Simon Power has not had a good run lately. He is leaving, and we will all miss him. I think it would boost his morale if he stood up and told us what that missing statute is.

I do not want to be frivolous; I think I have said enough tonight. I am really happy that this is a bill—unlike many other bills in this House—that we in Labour are supporting. I look forward to its progress through the House. Thank you very much, and I do hope the Minister in the chair can enlighten the Committee about the missing statute.

CAROL BEAUMONT (Labour): While the Minister in the chair, the Minister of Justice, is frantically looking for the missing Act that was mentioned by Lynne Pillay—we are very keen for him to enlighten all of us on what that missing Act is—I will speak to Part 4 of the Courts and Criminal Matters Bill. It amends a whole number of pieces of legislation, including the missing one, which Lynne Pillay will beaver away on as well while I talk. One of the members will find it. There is a prize for the winner—the person who finds it. Ms Pillay has obviously gone through and listed the amendments to other Acts, so I will not—[Interruption] I would rather not do it again. I am sure the Committee really does not want me to do that.

I repeat that the Courts and Criminal Matters Bill is an omnibus bill and Labour supports it. Part 4 illustrates the extent of the reach of these changes and the number of different Acts that are affected by this bill. Primarily, the principal Act in each case is amended by different definitions and interpretations. I will illustrate that for people so that they get a sense of it, as I am sure members would like me to do.

The amendment to the Customs and Excise Act 1996 is a change to the definition of “fine”. The bill adds paragraph (e) to the definition, which states: “any amount payable under section 138A(1) of the Sentencing Act 2002.” Likewise, there are amendments to some of the other Acts, including the Children, Young Persons, and Their Families Act 1989. The Act is amended by clause 79, “Interpretation”, which repeals the definition of “traffic offence” and substitutes the following definition: “ ‘traffic offence’ means—(a) any offence against the Transport Act 1962, the Road User Charges Act 1977, the Transport (Vehicle and Driver Registration and Licensing) Act 1986, the Land Transport Act 1998, or the Land Transport Management Act 2003 or against any regulation, rule, or bylaw made under any of those Acts: (b) any offence against any regulation, rule, or bylaw made under any other Act if the offence relates to the use of motor vehicles or parking places or transport stations”.

The reason why this multitude of Acts has to be changed under Part 4 is to deal with all of the situations where people can incur fines. There are also some other changes, like the changes being made to the Privacy Act, for example, which I spoke about at some length when I was speaking on Part 3.

The Railways Act—that is interesting—is being amended in relation to the issuing of infringement notices. I will not go through all of the wording there, because it is quite a long change, but the bill puts in a whole new section 100. It talks about the content of infringement notices and reminder notices and about what is meant to be in those things. We also have amendments to the Tax Administration Act, which is quite interesting. Those amendments relate to the disclosure of certain information in relation to fine defaulters. The definition of “fine defaulter” is amended.

Again, these are all very much consequential changes. They are, if you like, tidy-ups to ensure that these various Acts will be able to deal with the substantive changes in the Courts and Criminal Matters Bill, which, as we have said earlier—and we agree with members opposite—has a very good purpose. It is to address a general concern about the number of overdue fines, the dissatisfaction of victims when offenders do not comply with reparation orders, and the frustration of creditors and debtors who use the court’s civil debt enforcement process.

I think in the course of the discussion tonight on the various parts, including Part 4, we have seen some real efforts to try to balance protections and so on—such as people’s rights under the Privacy Act—with the responsibility to pay fines. Certainly most of us in this Chamber believe it is important that when fines are given for various offences, people do pay those fines. A failure to do so not only builds up a huge amount of debt, which leads to problems for individuals and their families, but also undermines the legislation.

The question was put that the amendments set out on Supplementary Order Paper 244 in the name of the Hon Georgina te Heuheu to the proposed amendments set out on Supplementary Order Paper 202 in her name to Part 4 be agreed to.

Amendments to the amendments agreed to.

The question was put that the amendments as amended set out on Supplementary Order Paper 202 in the name of the Hon Georgina te Heuheu to Part 4 be agreed to.

Amendments as amended agreed to.

A party vote was called for on the question, That Part 4 as amended be agreed to.

Ayes 109

New Zealand National 58; New Zealand Labour 42; ACT New Zealand 4; Māori Party 3; Progressive 1; United Future 1.

Noes 10

Green Party 9; Independent: Carter C.

Part 4 as amended agreed to.

Schedule 1

The question was put that the amendments set out on Supplementary Order Papers 202 and 244 in the name of the Hon Georgina te Heuheu to schedule 1 be agreed to.

Amendments agreed to.

Schedule 1 as amended agreed to.

Schedule 2

The question was put that the amendments set out on Supplementary Order Paper 202 in the name of the Hon Georgina te Heuheu to schedule 2 be agreed to.

Amendments agreed to.

Schedule 2 as amended agreed to.

New schedule 2A

The question was put that the amendment set out on Supplementary Order Paper 244 in the name of the Hon Georgina te Heuheu to proposed new schedule 2A set out on Supplementary Order Paper 202 in her name be agreed to.

Amendment to the amendment agreed to.

New schedule 2A as amended agreed to.

New schedule 2B

The question was put that the amendment set out on Supplementary Order Paper 202 in the name of the Hon Georgina te Heuheu to insert new schedule 2B be agreed to.

New schedule 2B agreed to.

Schedule 3

The question was put that the amendment set out on Supplementary Order Paper 202 in the name of the Hon Georgina te Heuheu to schedule 3 be agreed to.

Amendment agreed to.

Schedule 3 as amended agreed to.

Clause 1 agreed to.

Clause 2

The question was put that the amendments set out on Supplementary Order Paper 202 in the name of the Hon Georgina te Heuheu to clause 2 be agreed to.

Amendments agreed to.

Clause 2 as amended agreed to.

The Committee divided the bill into the District Courts Amendment Bill, the Land Transport Amendment Bill, the Summary Proceedings Amendment Bill (No 3), the Children, Young Persons, and Their Families Amendment Bill (No 2), the Crimes Amendment Bill (No 4), the Criminal Proceeds (Recovery) Amendment Bill, the Customs and Excise Amendment Bill (No 2), the Disputes Tribunals Amendment Bill (No 2), the Family Courts Amendment Bill, the Immigration Amendment Bill, the Misuse of Drugs Amendment Bill (No 3), the Misuse of Drugs Amendment Act 1978 Amendment Bill, the Personal Property Securities Amendment Bill (No 2), the Prisoners’ and Victims’ Claims Amendment Bill, the Privacy Amendment Bill (No 2), the Railways Amendment Bill, the Residential Tenancies Amendment Bill (No 3), the Sentencing Amendment Bill (No 5), the Social Security Amendment Bill (No 4), and the Tax Administration Amendment Bill, pursuant to Supplementary Order Paper 243.

Bill to be reported with amendment presently.

Bills

Weathertight Homes Resolution Services (Financial Assistance Package) Amendment Bill

In Committee

Part 1 Amendments to principal Act

PHIL TWYFORD (Labour): It is a pleasure to make a contribution to the Committee stage of the Weathertight Homes Resolution Services (Financial Assistance Package) Amendment Bill. As the Committee will know, we have supported this bill through its first and second readings, and I think there was a pretty constructive discussion at the Local Government and Environment Committee. We have teased out various issues. Not all of the concerns and questions, from our perspective, have been addressed satisfactorily, but we remain of the view that this is a genuine and significant attempt by the Government, led by the Minister in the chair, the Minister for Building and Construction, to make a serious contribution to the situation facing many thousands of New Zealand homeowners whose homes have been affected by the leaky homes problem.

In the course of this debate we will be setting out four amendments, which will deal with the issues that we think are the most pressing and the most outstanding. If I may I will set out what those issues are, and I look forward, later in this debate, to having a good exchange with the Minister on these issues.

The first issue is that we believe there is insufficient justification for Crown indemnity, which effectively gives immunity to the assessors from the Department of Building and Housing. It relieves them of their common law duty of care for the work they do in assessing the agreed repairs. There was quite a lot of commentary in the regulatory impact statement, including commentary from officials from the Department of Building and Housing, who said that there was no need for that immunity, and there was no reason why the assessors working for the department should not be held to the normal duty of care and should not be able to be held accountable for negligence, for instance, down the track if things went wrong in the repair process because of a defect in their work. I know that that indemnity was the main purpose of having this bill in the first place, but I am not sure we heard a convincing explanation for it at the select committee.

There are other points. Another one that was dealt with in some detail in the regulatory impact statement is the question of the rights of third parties. We know that the councils said that if we want them to sign on to this package then we have to protect them from third party claims. But this bill effectively takes away common law rights that third parties might have, for example, if they are sued by an owner. If a builder or architect is sued for work they have done or have not done earlier, that home and homeowner is then part of this process and is given the benefit of the assistance package. The homeowner can sue that builder or architect, but the builder or architect is prevented by the provisions of this bill from joining a council, which, in their view, may bear more of the responsibility. I will table a solution in the course of this debate that I hope the Minister will give serious consideration to, because we think it is a compromise solution that may protect the council without actually—

Hon Maurice Williamson: Give me a chance to look at it and I’ll consider it.

PHIL TWYFORD: We will do our best to get it to the Minister. It is currently being drafted.

A third amendment we will bring to the Committee deals with the whole issue of whether the benefits of this package should be available to property speculators. If the bill is passed in is current form, they will be able to pick up a leaky home at knock-down rates and get the full benefit of the Crown and local government contribution. Fifty percent of the repair cost will be contributed by the taxpayer, so the speculator can do it up, fix the problem, and flick it on at a significant profit. Given some of the restrictions that have been placed around this bill and around who may benefit from it, it does not seem justifiable in our view that the substantial council and central government subsidy should be available to speculators. I know that the view of the Government on this issue has been that we want to see these houses fixed and it does not matter who fixes them. But we think that, given the huge unmet need that will remain, it would make much more sense to limit eligibility to genuine homeowners, not people who bought the property knowing it had a leaky problem.

The fourth issue we would like to address in this debate, which we will be tabling an amendment on, relates to people who live in multi-dwelling complexes—apartment dwellers. It is my impression from having taken part in the discussions at select committee that it is unlikely that very many people whose apartments are affected by this problem will benefit from this package. We are told, based on the work of PricewaterhouseCoopers, that there are probably about 24,000 New Zealanders who are owners of units and multiple—

House resumed.

The Chairperson reported the Courts and Criminal Matters Bill with amendment, and that the Committee had divided it into 20 bills, and progress on the Weathertight Homes Resolution Services (Financial Assistance Package) Amendment Bill.

Report adopted.

The House adjourned at 9.57 p.m.