Wednesday, 30 May 2012

Wednesday, 30 May 2012

Wednesday, 30 May 2012

Mr Speaker took the Chair at 2 p.m.

Prayers.

Visitors

Serbia—Delegation, National Assembly

Mr SPEAKER: I have much pleasure in informing the House that a delegation from the National Assembly of Serbia, led by the Hon Vuk Jeremic, Minister of Foreign Affairs, is within the precincts of this Chamber. I am sure members would wish that the Minister be welcomed and accorded a seat on the left of the Chair and that the delegation in the Speaker’s gallery be welcomed.

The Hon Vuk Jeremic, accompanied by the Minister of Foreign Affairs, entered the Chamber and took a seat on the left of the Chair.

Chamber, Lobbies, and Galleries

Feminists of the Year—Contestants

JAN LOGIE (Green): I have been fortunate in the last hour to be in my office with the feminists of the year contestants. They are in the gallery, and I think this House would like the opportunity today to acknowledge them.

Mr SPEAKER: Could I perhaps suggest to the House that, rather than see this practice continue indefinitely, where members do wish to acknowledge visitors in the gallery, perhaps the appropriate way to do it would be to seek the leave of the House. All members know they are not meant to refer to visitors in the gallery. If members wishing to do something like that were to seek the leave of the House to have such people acknowledged, I think it would be a more appropriate way to go about it.

Questions for Oral Answer

Questions to Ministers

Freshwater Management—Water Quality

1. Dr RUSSEL NORMAN (Co-Leader—Green) to the Prime Minister: Does he stand by his statement that “efficient water management is a big part of New Zealand’s competitive advantage and our clean and green brand”?

Rt Hon JOHN KEY (Prime Minister): Yes.

Dr Russel Norman: Does he agree with the OECD country report 2011 that “As an exporter of resource based goods and services, [New Zealand’s] brand relies on the environmental integrity of its output and policies.”, and is his Government achieving that?

Rt Hon JOHN KEY: I think that is one of the factors. I also agree with the OECD when, in 2010, we were rated as having the second-to-best water quality, by Yale and Columbia.

Dr Russel Norman: Is the Prime Minister aware that the Yale report that he just quoted from has now been updated and our ranking has moved from second to 43rd, and does his Government take credit for the movement in our ranking in the Yale report from second to 43rd?

Rt Hon JOHN KEY: I would need to look at that particular report and which bit he is taking out of it. Overall, what I can say is that if you look at New Zealand, we rank pretty well on most of those categories. And if you go and look at the 2011 Global Green Economy Index, New Zealand is ranked first out of 27 countries for overall performance, which includes, amongst other things, leadership in green tourism.

Hon Dr Nick Smith: Can the Prime Minister confirm that in his Government’s first four Budgets there has been an almost sixfold increase in the amount committed to freshwater clean-ups over the previous four Budgets, involving new initiatives for Lakes Ellesmere, Rotorua, Rotoiti, and Taupō; lagoons like Waituna, Wainono, and Wairarapa; and rivers like the Manawatū and the Waikato; and does not this action, more than words, speak volumes about his and his Government’s commitment to improving freshwater management?

Rt Hon JOHN KEY: Yes, I am aware of that, and all that it demonstrates is that National in Government cares more about water quality and water standards than Labour did when it was in Government.

Dr Russel Norman: I seek leave to table the Yale Environmental Performance Index from January 2012 showing New Zealand at 43rd—no longer second.

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

Dr Russel Norman: Does the Prime Minister stand by his statements when, twice in this House last year and then again today, he has relied on the Yale report to justify his Government’s environmental performance—and his former Minister for the Environment relied on it on a number of occasions, as well—even though the updated figures show that under his Government New Zealand has fallen from second to 43rd in freshwater quality?

Rt Hon JOHN KEY: I am not sure that I would characterise it as relying on it; I am saying that it is one particular indicator. What the Government has relied on is what it has done. As opposed to Labour, which did very little, National has introduced a National Policy Statement on Freshwater Management; established the collaborative Land and Water Forum, which is going well; appointed Environment Canterbury commissioners, who have delivered an operative water plan for Canterbury; launched the Fresh Start for Fresh Water clean-up fund; passed regulations for metering 98 percent of water takes; doubled the fines for non-compliance with resource consents; and increased the funding to improve our water to almost six times what it was under the previous Government. That is what I have relied on.

Te Ururoa Flavell: Kia ora tātou. Can I ask how he will ensure that councils and governing bodies respect the unique relationship that whānau, hapū, and iwi have in respect of their kaitiaki obligations and responsibilities throughout their rohe; and does he agree with the Land and Water Forum that there should be better recognition given to iwi tikanga and values in the National Policy Statement on Freshwater Management?

Rt Hon JOHN KEY: That is somewhat a matter for local government, but what I can say is that the Land and Water Forum, with the wide participation in that grouping, is allowing for a very collaborative process. It has written two reports. The third report will come out in November. But from talking to a variety of different members of that Land and Water Forum, including environmental groups themselves, I find that they are very optimistic about the results they see and the actions that are being taken.

Dr Russel Norman: In reference to his earlier answer about the national policy statement, why did his Government decide to weaken substantially the National Policy Statement on Freshwater Management, against the advice of the Land and Water Forum and against the advice of the board of inquiry that had been established to make the recommendation on the National Policy Statement on Freshwater Management?

Rt Hon JOHN KEY: Cabinet always considers a wide range of factors. We felt at the time that what the national policy statement had come up with was the best reflection of a balanced approach to what we were trying to achieve.

Dr Russel Norman: How will his Government’s plan to subsidise dairy intensification in Canterbury and elsewhere, through both the irrigation fund that has been mooted by the Government and the very large subsidies to greenhouse emissions coming out of the dairy sector, result in cleaning up our waterways and help to protect New Zealand’s clean and green brand, the foundation of our economy?

Rt Hon JOHN KEY: Intensification of itself could worsen the problem if there were not a number of other steps being taken. But, again, if you go and talk to the participants in the Land and Water Forum, what they are saying is that both Federated Farmers and Fonterra are taking a much more responsible view towards that intensification. One of the members of one of the major environmental groups said to me last week that, in principle, if there were to be major irrigation in the South Island, he would be supportive of a very large scheme, because he thinks that, in terms of intensification, that would actually help in terms of offsetting it. And, in general, if irrigation takes place, it takes pressure off the aquifers. So, overall, it is a balanced approach.

Dr Russel Norman: Does he believe that his approach of talking about a balance between the environment and the economy—so, essentially, trading off a bit of environmental degradation for a bit of economic growth—is the right approach to take, or should we take the approach that the environment is the foundation of our economy and we should stop degrading it, because that will, fundamentally, undermine us in the long run?

Rt Hon JOHN KEY: No. What I think is important here is establishing how we can grow the economy while ensuring that we preserve our environmental credentials. I think that, on balance, for the most part we are doing that. In fact, if you go and have a look at areas of science, the global greenhouse gas alliance is a great example. We are increasing, potentially, the methane and nitrate emissions that may come from agriculture, because of intensification, but we are offsetting those through the scientific research that we are doing through the greenhouse gas alliance. If the member wants to go back to the Stone Age, where we do absolutely nothing, that is fine, but it will not pay for the many wish lists he comes up with every day.

Dr Russel Norman: Why is it that every one of the Government’s big economic policies, the winners that this Government is picking to subsidise—whether it be deep-sea offshore mining, fracking, dairy intensification, or subsidising greenhouse gas pollution via motorways—involves degrading the environment?

Rt Hon JOHN KEY: I would reject that. There has been quite a substantial increase in areas of the economy where there is no impact at all on the environment. If the member wanted to come and support us on the national convention centre being brought to us by Skycity—or if the member had wanted to get out there and support us when we brought the Hobbit movies with their 3,000 jobs to New Zealand—I would look forward to it. But the member probably will not do that. He will just carry on whingeing, like he normally does.

Schools, Class Sizes—Teacher to Pupil Ratios

2. DAVID SHEARER (Leader of the Opposition) to the Prime Minister: Does he have confidence in his Minister of Education?

Rt Hon JOHN KEY (Prime Minister): Yes.

David Shearer: Does he agree—

Mr SPEAKER: Order! I have to call the member. I must say, with all the noise, I did not even hear what the Prime Minister said. I trust the answer was “Yes.”, so we will go to the Leader of the Opposition.

David Shearer: Does he agree with his education Minister that it is good news that the schools are only losing up to two teachers?

Rt Hon JOHN KEY: I think that needs to be seen in the context of what the Minister said. [Interruption] Well, I can take any couple of words out of context if I want to. What the Minister was saying is that there is an absolute limit to the number of teachers that a school could lose. What she was also saying, though, very importantly, is that there will be 962 schools that will potentially gain a teacher, there are 230 schools that will potentially gain two teachers, and there is well over $100 million going into professional development to help the 50,000 teachers who are there. I think if we go and ask New Zealand parents whether they want to see professional development supporting quality teaching in this country, I think you will find that the answer from most of them will be yes.

David Shearer: Is the Prime—

Mr SPEAKER: Order! The House will come to order. I must be able to hear these questions. I know my hearing is not great, but the noise is pretty loud, and I must be able to hear these questions.

David Shearer: When he said yesterday that he was aware of the impact of the changes made to staffing ratios when Budget decisions were made, why did he personally intervene in this issue only on Monday this week to limit staff losses to two?

Rt Hon JOHN KEY: As we made clear yesterday, there has always been a transition process that was going to take place, and it made sense as we wrote to the schools last Thursday, and it made sense, actually, for that transition to be in conjunction with them, but because we wanted to allay the fears that some parents could have, we have made it clear that it is limited to two fulltime-equivalents. But this may be the piece of information that Labour does not want out there, and that is that the performance of New Zealand students on average did not change between 2000 and 2009 when it came to reading. For the vast bulk of that time, Labour was in Government. If one looks at the Programme for International Student Assessment study and other international studies—

Mr SPEAKER: I think we have had sufficient answer to the question asked.

David Shearer: Is he saying that by increasing class sizes he will be able to improve the educational learning of our children?

Rt Hon JOHN KEY: What I am saying is that between 2000 and 2009 the reading performance of New Zealand students on average did not change. What I am saying is that the performance in the Programme for International Student Assessment and other international surveys of student achievement has remained relatively static over the past decade, despite the fact that we have hired 6,000 extra teachers. We now have approximately 50,000 teachers, and maybe it is time to give those teachers a bit more support to get quality teaching outcomes.

David Shearer: I raise a point of order, Mr Speaker. That was actually a pretty straight question: did he consider increasing class sizes improved child learning quality?

Mr SPEAKER: Order! The member has just pointed out that he asked “Does he consider that …”. The Prime Minister in answering gave information about the impact of the number of teachers employed on pupil achievement, and I think that was a reasonable answer to the question asked because the question asked was a little bit tongue-in-cheek. The Prime Minister pointed out the facts of the matter about the number of extra teachers, and therefore the reduction in classes seemed to have no impact on learning outcomes. That seems to be a reasonable way to answer the question. I call the Leader of the Opposition—

Hon Paula Bennett: He’s laying down the facts; they don’t like the facts of it.

Mr SPEAKER: Order! I want to hear the Leader of the Opposition’s question.

David Shearer: Can he and his education Minister give parents an assurance that school staffing entitlements will not be further reduced after the end of the third year?

Rt Hon JOHN KEY: We will work our way through that in the fullness of time. But what is interesting is that there will be an election and quite a number of Budgets before then.

David Shearer: Does he agree with intermediate school principal Barry Roberts, who said in response to the changes announced yesterday that “Instead of death by shooting, it’s death by strangulation and hoping we’re not going to notice the difference.”?

Rt Hon JOHN KEY: No, and let me go back to this basic point. Let us ask the most basic question for a moment. Are we all sitting around in this country saying that when there is no change in the average reading performance of our kids for over a decade, and when the Programme for International Student Assessment studies and others are showing there is no basic change, yet we have hired 6,000 extra teachers and had very low roll growth, we should just carry on and hire a few hundred more? If it has not worked for the last 6,000, it is probably not going to work for the next 6,000. The facts of life are that those guys left office with one in five kids unable to read and write properly, and they did not care. Well, we are actually doing something about it.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. You will observe that the Prime Minister received a question, then he phrased another question, proceeded to answer that question, and ended up with a rant and rave about the Labour Party. Surely that cannot be the way we conduct question time.

Mr SPEAKER: Order! I—[Interruption] Order! I am on my feet. Again, I invite the right honourable member to listen to the question. The question asked whether the Prime Minister agreed with a statement from a school principal, I think, that the changes were not something to do with being shot but death by strangulation or something, from memory. He asked whether the Prime Minister agreed with that. The Prime Minister in his answer told the House what he did agree with. And if members want to ask questions of Ministers about what they agree with—whether they agree with certain fairly out-there statements, and that was a fairly out-there statement—the Ministers are at liberty to tell the House what they do agree with. I am not going to stop Ministers from telling the House what they do agree with over important issues like this. This is not just a game; these are important issues. That is why members have focused on these issues. And the chance to get decent questions and answers in the House is an important part of our process. I think that was not an unreasonable answer to the question asked.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. My hearing is as good as yours, for a start. I heard what the answer was in respect of the teacher’s comment, but then he raised a new question himself, and then proceeded to answer that and you never stopped him. Then he attacked the Labour Party, and you did not stop him doing that. He answered one question, the first one first, then phrased a question of his own, then he answered that, and that is not within the Standing Orders.

Mr SPEAKER: With respect to the right honourable gentleman, the Speaker determines that. Again, I can be of far greater assistance to members if questions do not ask whether Ministers agree with all sorts of statements from all over the place, because it is very hard to pin down Ministers when they are asked for their opinions. Ministers are at liberty to give their opinions if they asked for their opinions. I can be of much greater assistance if a question asks for information. The information can be very telling in itself, and that is where I can be of much greater assistance to members.

Hon Trevor Mallard: I seek leave to table a Programme for International Student Assessment report, which shows that 15-year-olds’ reading in New Zealand went from fourth in the world in 2006 to second in 2009.

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.

David Shearer: Does he stand by his statement to Radio New Zealand National yesterday that as of Tuesday morning he had not had anyone specifically raise the issue of class sizes with him?

Rt Hon JOHN KEY: Yes.

David Shearer: I would like to table a number of letters addressed to John Key and copied to me expressing a great deal of concern about the increase in class sizes.

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

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

Budget 2012—Effect on Debt and Interest Rates

3. SHANE ARDERN (National—Taranaki - King Country) to the Minister of Finance: How will Budget 2012 reduce New Zealand’s long-standing reliance on debt and help keep interest rates lower for longer?

Hon STEVEN JOYCE (Associate Minister of Finance) on behalf of the Minister of Finance: Budget 2012 will do this in a number of ways. Firstly, it keeps the Government on track for fiscal surplus in 2014-15, when we can start repaying debt. That is important in a world that is deeply concerned about debt. Secondly, it continues the Government’s programme to address our longstanding imbalances by building sustainable growth from savings and productive investment, rather than excessive debt, property speculation, and Government spending. Thirdly, the Budget reprioritises existing spending to invest significantly more in infrastructure, innovation, and skills. These are essential ingredients in giving businesses the confidence to invest, sell more to the world, and employ more staff. All of these things will ensure future growth does not rely on excessive debt and fast-growing Government expenditure. It will keep interest rates for homeowners and businesses lower for longer.

Shane Ardern: How have New Zealanders benefited from lower interest rates in the past 3 years?

Hon STEVEN JOYCE: Both households and businesses are now paying very significantly lower interest rates than they were in late 2008. For example, average floating home rate mortgages have fallen from almost 11 percent in 2008 to an average of 5.9 percent currently. For a family with a $200,000 mortgage, that is a saving of about $200 a week. Similarly, business lending rates have fallen from more than 9 percent to around 6 percent in the same period, so both households and businesses are benefiting from lower interest rates under this Government and its responsible economic policy.

Shane Ardern: What progress is being made in improving savings and reducing New Zealand’s reliance on debt?

Hon STEVEN JOYCE: I am pleased to report good progress is being made. Households and businesses have started to save and pay down debt. New Zealand’s household savings rate is positive, and it is forecast to increase to almost 4 percent by 2016. That is a significant turn-round, as household savings have been negative in almost every year, going back at least two decades. Although these higher savings do temper economic growth a little in the short term, over time they will leave New Zealand considerably better off and less vulnerable to economic shocks.

Shane Ardern: What reports has he received supporting the Government’s responsible fiscal approach in Budget 2012?

Hon STEVEN JOYCE: The Minister of Finance has seen a number of reports supporting the Budget’s focus on getting on top of debt. For example, ratings agency Moody’s has said the deficit and debt forecasts in the Budget support the Government’s current triple A credit rating. It says that in the absence of further shocks, the Government’s overall fiscal position will improve considerably over the next several years. Standard and Poor’s has said the Budget is the latest step forward to consolidating the Government’s fiscal settings. Its stable ratings outlook reflect its expectation the Government will continue to consolidate public finances against the risks associated with the country’s high private sector external debt.

Whānau Ora—Prime Minister’s Statements

4. Rt Hon WINSTON PETERS (Leader—NZ First) to the Prime Minister: Does he stand by his statement that Whānau Ora is aimed at “families who need significant support”?

Rt Hon JOHN KEY (Prime Minister): I stand by my full statement, which was: “In terms of the wider overall issues about Whānau Ora, that is aimed very much at families who need significant support and are using a multitude of different agencies, and the Government is looking at ways to improve the outcomes. Given the successful track record we have had in the past of being totally unsuccessful with those families, I would have thought that trying new ways was not a bad idea.”

Rt Hon Winston Peters: Does he believe that just some Māori families should be receiving significant support in the form of thousands and thousands of dollars in grants to develop plans to “promote who they are”, to “take control of their lives and move out of the status quo lifestyle”, and “to weave the strands of whānau together with the collective goal of reconnection”, and much more psychological babble like that?

Rt Hon JOHN KEY: I do not know where the member is quoting from, but I can say the overall ethos of Whānau Ora is to support vulnerable families and to try to get them to empower changing their own lives.

Rt Hon Winston Peters: How can he reconcile the fact that his Government is taxing paper boys earning a pittance, while he and the Māori Party are spending over $12 million of taxpayers’ money financing projects such as Whānau Ora helping a family to “promote who they are”?

Rt Hon JOHN KEY: You are talking about very vulnerable families who are probably already incurring significant costs to New Zealand taxpayers. If we do not address some of their issues, all probability is that they will cost New Zealand a lot more.

Rt Hon Winston Peters: So which was the vulnerable family, or families, involved in the $60,000 Whānau Ora grant to conduct research and hold a community day at a sports club in Ōtaki, and how did they qualify to be in need of—to quote his words yesterday—“significant support”?

Rt Hon JOHN KEY: Individual cases need to be directed to the Minister for Whānau Ora.

Rt Hon Winston Peters: Is he aware that hundreds of Whānau Ora plans, which are being prepared at great expense to the taxpayers, are plans that actually involve applying for further Whānau Ora funding to implement these very same plans?

Rt Hon JOHN KEY: I cannot confirm that. If the member wants to find out a little more he should ask questions directly to the Minister for Whānau Ora.

Rt Hon Winston Peters: Is the Prime Minister saying therefore by that answer that he does not know what is going on in respect of the Minister in charge of Whānau Ora’s future plans; if that is the case, why has he not apprised himself of that as every other former Prime Minister would have?

Rt Hon JOHN KEY: No, I am saying that if the member wants to ask individual questions about specific cases, he should direct them to the Minister for Whānau Ora.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. I am asking the Prime Minister as Prime Minister of this country. I do not need to hear references as to whom I should ask the question, in respect of a specific Minister. I am asking the Prime Minister, the No. 1 Minister in this country, as to whether he agrees with these plans. I cannot get his answer from Tariana Turia—

Mr SPEAKER: Order! The very reason why we have a number of Ministers covering a range of portfolios is that they have the detail on those portfolios. I do not think anyone has ever expected the Prime Minister to be able to cover all detail in all portfolio areas. That is the risk of directing questions to the Prime Minister on other portfolios—the Prime Minister may not have all the detail on those matters. That is not unreasonable.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. If that is the case, that is the Prime Minister’s answer. He does not need you to give it, with respect.

Mr SPEAKER: Order!

Rt Hon Winston Peters: No, let me finish.

Mr SPEAKER: Order! No, I am not going to listen to any more of this rant. The member will resume his seat.

Rt Hon Winston Peters: Well, I’ll be back with another point of order, then. I am not going to be ramrodded out of this place.

Mr SPEAKER: Order! If the member carries on with this, he will just leave the House. It is his choice. I am not going to have that sort of nonsense. If the member wishes to pursue details about a particular portfolio, that is why we have Ministers—they can be asked. The Prime Minister cannot be expected to have detailed information in every portfolio area. The Prime Minister said he did not have that information, and that is a perfectly proper answer for the House. The remedy is in the member’s hands. If he wishes to pursue that issue, he can pursue it through questioning the Minister responsible for that portfolio.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. If that was the Prime Minister’s answer, he was open to give it, but he is not correct to then say that someone is offending against the House’s traditions under the Standing Orders by asking him and not the Minister. Let me give you an example. I asked about the Mongrel Mob in Dunedin. That Minister knew nothing about it and put a full-scale departmental research in place to find out whether I was right or wrong. Yesterday, the Prime Minister said that I was wrong.

Mr SPEAKER: Order!

Rt Hon Winston Peters: I’ve got a letter to you on that question.

Mr SPEAKER: No. Order! We are not going to take more time in the House on this. The member knows full well that Governments can transfer questions to other Ministers.

Rt Hon Winston Peters: But he didn’t transfer it.

Mr SPEAKER: Order! Look, the member is normally very respectful of this House. I accept that he is grumpy, and grumpy with me. I accept that. But the Standing Orders—[Interruption] Order! I am on my feet. The Standing Orders must apply equally to all members, and all members know that if they question the Prime Minister on certain detailed portfolio areas the Prime Minister cannot be expected to have all the detailed information in every portfolio area. I do not recollect questions in the House to the Minister for Whānau Ora. I might have forgotten. Forgive me, I may well have forgotten, but I do not recollect—

Hon Trevor Mallard: You have forgotten, Mr Speaker. We do. We recollect.

Mr SPEAKER: In recent times, then.

Hon Trevor Mallard: It’s all right—last week!

Mr SPEAKER: Order! So I am not being unfair to the member, but the Prime Minister has answered that in that way, and that is a perfectly acceptable answer, and there is nothing that I can do about that.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. Would it be in order, then, for every question that the Prime Minister gets, to be answered in this way: “Please refer that question to the Minister who is directly in charge of that portfolio.”? Would that be in order? I am asking the Prime Minister—and this happens in every other British democracy that I know of; every English-speaking democracy. The Prime Minister is required to either answer the question or say he cannot. But he cannot say that the member is acting improperly by not referring it to the Minister. That is why he was made the Prime Minister, for goodness’ sake!

Mr SPEAKER: Order! If the member got that impression I apologise to him because I am sure it was not intended to mean that the member was not addressing question time properly by not directing the questions to the Minister. That should not be implied. But what I am trying to point out to the House is that there are some limitations on questioning the Prime Minister over detailed portfolio areas. That is all I am trying to point out to the House. Members are absolutely at liberty to question the Prime Minister—that is their absolute right. But there are those limitations around what information the Prime Minister can have at his fingertips.

Budget 2012—Effect on Child Poverty

5. JACINDA ARDERN (Labour) to the Minister for Social Development: How many children will be lifted out of poverty as a result of Budget 2012?

Hon PAULA BENNETT (Minister for Social Development): Budget 2012 will build a stronger economy, which will drive employment growth, leading to strong and resilient families. As a consequence, children will be better off. That is what Budget 2012 is all about. There is not an official measure of poverty, so as such you cannot give a number.

Jacinda Ardern: Does she accept the Children’s Commissioner’s estimate that failure to invest in the early years of a child can come at a cost of $1 million to taxpayers per child; and if so, how much did the Government invest in children in this Budget to save the future cost of up to 270,000 children in poverty?

Hon PAULA BENNETT: I certainly dispute the numbers that the member uses, but the Children’s Commissioner’s $1 million for individual children I think depends on their circumstances. So I certainly would not say—and, of course, poverty is relative. Also, children can move in and out of poverty throughout their lives, as adults can, as well. So there are certainly some caveats around those kinds of predictions.

Jacinda Ardern: What appropriations in Vote Social Development, or in the Budget generally, address the issue flagged by the briefing to incoming Minister by the Ministry of Social Development, which stated: “around two in five poor children were from households where at least one adult was in fulltime employment”?

Hon PAULA BENNETT: I think what the member raises is also quite interesting, as what we are investing in in this Budget for those children, whom we see as important. What we saw certainly is an increase when you look at health. So around rheumatic fever more money is going in there; and to those under-6-year-olds and their access to health, to their general practitioner, and to after-hours care as well. Certainly, what you are also seeing is a real investment in those intensive home visits in the early years, and that will make a significant difference. So I would say that this Budget certainly has raised a lot of issues. What we are doing, though, is targeting it, and targeting it to those children who need it most, instead of the kind of scattergun approach that we saw under Labour

Jacinda Ardern: Does she accept that according to the Unicef scorecard on child poverty, released today—in which New Zealand was found to spend 50 percent of the OECD average on a child’s early years, amongst other countries that have all experienced the same recession—“failure to protect children from poverty … is one of the most costly mistakes a society can make.”?

Hon PAULA BENNETT: I do think there is certainly money that should be invested in those early years, and this Government is certainly investing more than the previous Labour Government was in its years. So we are investing more in those children than actually ever has been before, and that is making a significant difference. That goes across health, across education, across certainly the Ministry of Social Development within Child, Youth and Family and Work and Income. But there is no doubt about it that all evidence presents that those who are in work have their children better off. I think that welfare reforms make a real difference to that.

Jacinda Ardern: If the Children’s Commissioner’s expert group on child poverty recommends targets to eradicate child poverty when it reports later this year, will she implement such targets; if not, why not?

Hon PAULA BENNETT: That is hypothetical. I am not going to pre-empt what that report comes out with and as such make a judgment on it.

Families Commission—Restructuring

6. ALFRED NGARO (National) to the Minister for Social Development: How is the Government refocusing the Families Commission?

Hon PAULA BENNETT (Minister for Social Development): The way the Families Commission works is about to change. We are restructuring the commission. This will see its core activities streamlined through a leaner, more focused structure. It will be headed by a single commissioner, down from the original number of seven, and will take on a new role providing for independent monitoring, evaluation, and research to measure the effectiveness of initiatives across the social sector.

Alfred Ngaro: What will the main benefits of the new Social Policy Evaluation and Research Unit be?

Hon PAULA BENNETT: If we are going to make a difference for the families who are struggling, we need to be able to invest in interventions that we know will work and that have had full evaluations. This new unit will build a body of evidence that will allow policy makers, non-governmental organisations, and anyone wanting to invest in social services to make informed decisions about which programmes are effective for New Zealand families.

Alfred Ngaro: What current activities will continue after the restructure?

Hon PAULA BENNETT: Firm decisions are yet to be made by the commissioner on the exact work programme for the core functions. However, I expect that its highly regarded family violence work will remain a core component throughout the change process.

Sue Moroney: Does her refocusing of the Families Commission include ensuring that the commissioner she appointed backed National’s position of opposing the extension of paid parental leave, when previously the commission had presented research to recommend extending paid parental leave to 13 months?

Hon PAULA BENNETT: It would be fair to say that, with an ex-commissioner actually now a Labour MP, actually that ex-commissioner might have agreed with a few things that Labour was doing. I have no influence over what the current commissioner thinks, or puts out, or does, and, as such, he is independent and runs accordingly.

Economic Growth—Progress

7. Hon DAVID CUNLIFFE (Labour—New Lynn) to the Minister for Economic Development: Does he agree with the Prime Minister’s statement “If you were really going to go out and buy a country, why wouldn’t you want to buy New Zealand?”; if so, why?

Hon STEVEN JOYCE (Minister for Economic Development): Yes; I think the member might find that that is what is known as a metaphor, which I would have thought that somebody who wrote poetry at Harvard might actually recognise. Even with my humble zoology degree, I can recognise a metaphor. The Prime Minister went on to explain that New Zealand is an amazing country—that on any relative measure across the world it is a great country. I think the point is that compared with many countries in the world New Zealand is doing very well. For example, we have grown in nine of the last 10 quarters. We are investing a huge amount in infrastructure at the same time that we are balancing our books, we are putting a lot of effort into boosting trade, and we are investing billions into higher education, increasing science and innovation funding, and doing the Government’s bit to help keep interest rates low.

Hon David Cunliffe: What does he think of the optics of trying to sell a country that has just seen a horrific 17 percent collapse in the value of goods exported, and where the main growth in exports is the thousand New Zealanders a week we are exporting to Australia?

Hon STEVEN JOYCE: I think the member is confusing the amount of goods with value. The reality is that in the calendar year 2011 New Zealand had very large growth in exports, both in value and in volume terms. That has come back a bit as commodity prices have come off this year, but there is still a very positive overall export scene, and the Government is working very, very hard to encourage businesses to become more competitive in the world, and to provide businesses with opportunities to get ahead, and will continue to do so.

Hon David Cunliffe: Does the horrific 17 percent drop in the value of goods exported mean that the Government was wrong to cut funding to promote exports to China, India, and the rest of Asia, as part of the $131 million per annum it has just slashed from Vote Economic Development?

Hon STEVEN JOYCE: The member is an emotive actor, but the reality is that the Government did not cut the sorts of sums of money he is talking about, at all. He needs to understand that some appropriations finish when the events that the economic development appropriation is involved with finish. For example, the member may have spotted—and, in fact, I think he did—the Rugby World Cup, which occurred last year. At the end of that period the appropriations for the Rugby World Cup were no longer needed, Mr Cunliffe, and therefore we did not continue them. I know that the member wants just to fire hose money in all directions, but actually the Government, when appropriations are finished, stops them.

Hon David Cunliffe: To the “Minister for Rugby World Cup Tickets”, why would he sell—

Mr SPEAKER: Order! We do not start questions that way.

Hon David Cunliffe: Why would he sell New Zealand now, when the New Zealand Institute of Economic Research has just downgraded its growth forecast to a stagnant 1.5 percent, and is this the same logic as selling highly profitable power companies when near the bottom of the economic cycle?

Hon STEVEN JOYCE: I wondered whether the member would bring up the New Zealand Institute of Economic Research, because one of the interesting things about its report is that it suggests that economic growth will be slower than suggested by some of the other commentators—which it is entitled to believe—primarily because New Zealanders are saving more, and actually that will dampen economic growth in the short term. We do not agree, necessarily, with the quantum, but the point that the New Zealand Institute of Economic Research made was that New Zealand’s household and commercial debt, but particularly household debt, had built up hugely to an imbalance while the previous Government—funnily enough—was in office, and it is now unwinding. So if there are any concerns about that actually slowing economic growth, they can only be sheeted home to the behaviour in the economy of the previous Government.

Hon David Cunliffe: I seek leave to table the full New Zealand Institute of Economic Research Quarterly Predictions report, made public today, which lists fiscal headwinds, slowing global growth, migration drains, and businesses treading cautiously as amongst the reasons for slashing again New Zealand’s growth output forecast.

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

Hon David Cunliffe: How interesting. I seek leave to table a graph created by the Parliamentary Library that shows the huge growth in exports of New Zealanders to Australia since this National Government came to power.

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

Question No. 8 to Minister

HOLLY WALKER (Green): I raise a point of order, Mr Speaker. Before I ask my question, I would like to raise a point of order and refer you to Speakers’ rulings 151/6 and 152/1 regarding the transfer of a question, where a question should not be transferred when only one Minister could be expected to have personal knowledge of the subject. My original question specifically addressed whether the Prime Minister stood by a statement. I think it is very difficult for another member to know what is in the mind of the Prime Minister.

Mr SPEAKER: Order! We are not going to go down this path again. I have heard this argument before. The question is fundamentally about students being able to borrow for living costs under the student loan scheme and the relationship of that to student allowances. Clearly, the Minister for Tertiary Education, Skills and Employment is in a position to be perfectly able to answer that question, so I do not think the House needs to waste more time on that.

HOLLY WALKER (Green): I seek leave of the House to transfer the question back to the Prime Minister.

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

Student Allowances, Postgraduate Students—Comparison with Student Loans

8. HOLLY WALKER (Green) to the Minister for Tertiary Education, Skills and Employment: Does he stand by the Prime Minister’s statement yesterday that the amount a student can borrow for living costs under a student loan each week is “very similar” to the student allowance?

Hon STEVEN JOYCE (Minister for Tertiary Education, Skills and Employment): Yes, because for the majority of students undertaking postgraduate, master’s, or PhD study their allowance of $170.80 per week will be replaced by the student loan living costs of $172.51 per week, and that seems quite similar to me. Of course, the member also needs to take into account the accommodation benefit and accommodation supplements when drawing comparisons for individual students before and after Budget 2012 changes.

Holly Walker: Did he tell the Prime Minister, then, that there is a $72 difference between the $172 a week that a student can borrow for living costs, and the $245 maximum that they can receive on a student allowance with the accommodation benefit, and does he also consider those two amounts to be very similar?

Hon STEVEN JOYCE: Well, I think the member is, if I may say so, being slightly disingenuous, because she refers to the accommodation benefit with allowances but does not refer to the accommodation supplement, which is available with student loans sometimes. For example—and it does vary for—

Grant Robertson: Sometimes.

Hon STEVEN JOYCE: No, it does vary for different students. Some of them are better off. For example, if you had a single 23-year-old with no children, not working, living away from home in Wellington, and the parents living together with no other full-time students in the household and a combined income of $42,000, then their allowance plus their accommodation benefit would be $212.51. Next year their student loan plus the accommodation supplement would be up to $272.51, depending on where they are living.

Holly Walker: Can he guarantee, then, that with the accommodation supplement, every student currently eligible for a student allowance for postgraduate study will have the same amount to live on each week as they have before these changes?

Hon STEVEN JOYCE: No, I cannot guarantee that for every student, but what I can say is that a number will be better off. There are some who will be worse off, but I will make a couple of points about the transition measures that were announced at the time: firstly, students with current student allowance applications that start in 2012 and finish in 2013 will continue to be eligible until the end of that period; students who apply for student allowances in 2013 for an enrolment period that started in 2012 will not be affected; and students with a dependent partner or children can continue to receive a student allowance for up to 1 year until 31 December 2013 or until they use up their 200-week lifetime entitlement to student allowances, whichever comes first, in which case the student must be continuing the same qualification. So we have sought to place those transition measures in place, but the important point of the policy is that we are expecting that those who have gone on to postgraduate study in a master’s or PhD area will be earning on average between 20 and 50 percent more than a person who gets an undergraduate degree once they qualify. Those people will be expected to use the student loan scheme and therefore pay that back so we can reinvest in further tertiary education.

Holly Walker: How does he imagine a third-year clinical psychology student, who is required to work full time, 4 days a week, as an unpaid intern, attend one full day of classes, and complete assignments and exam preparation in the evenings and weekends, will survive on the $172 per week she can now borrow under the student loan scheme?

Hon STEVEN JOYCE: I need to clarify with the member. She is referring to a person studying at what level of study?

Mr SPEAKER: I invite the member to clarify her question.

Holly Walker: Third-year clinical psychology is a postgraduate qualification.

Hon STEVEN JOYCE: I cannot answer that particular member’s example, because it differs. The point that is being made through this question is that it varies depending on the person’s individual circumstances. So on the base allowance and the base student loan it is the same, but depending on their personal situation and their accommodation situation, it could be either more or less, and we do not know the answer to that question until we know that person’s absolute circumstances.

Holly Walker: How much longer will it take students of clinical psychology, or, indeed, teaching or other postgraduate qualifications, to pay back their student loans with the addition of the $172 extra per week they must now borrow to live, and how will that add to the country’s student loan debt burden?

Hon STEVEN JOYCE: Again, I cannot give the exact numbers for that. What I can tell the member, again, is that the postgraduate people whom we are talking about are going to earn on average significantly higher sums than not only the people who get an undergraduate degree but also people who do not get a degree at all. And we are asking those people—the ones who never go to university—to subsidise through their taxes 70 percent of the tuition costs of the students who go to university, to subsidise more than 40c in the dollar of the cost of their student loans, and in some cases to also subsidise their student allowances. That is a very big subsidy from somebody who does not go to university to somebody who does and who actually could be earning anything between 70 and 100 percent more than that person once they leave university.

Fines, Collection—Improvements

9. Dr CAM CALDER (National) to the Minister for Courts: What progress is the Government making on improving the collection of court fines and reparations?

Hon CHESTER BORROWS (Minister for Courts): Excellent progress. Last year the Collections Department started a data-match regime with the Inland Revenue Department and the Ministry of Social Development to locate defaulters on fines who had “gone, no address” and would not be located. They anticipated that they would recover about $15 million in the first year, but after only 7 months they have already recovered $16 million, and this is excellent progress.

Dr Cam Calder: Is this all that the Government is doing to improve the collection of fines and reparations?

Hon CHESTER BORROWS: No, it is not. Last year the Government passed the Courts and Criminal Matters Bill, which allowed for credit checks to be made by credit agencies to find out just who owed what on fines, principally to prospective borrowers from those credit rating agencies. This amounted to a further gain in fines collected from these defaulters. Also, next year the Collections Department will be able to suspend drivers’ licences for those people who owe traffic fines, and this will recover more money, while taking those negligent drivers off the road. Along with other matters, this will reinforce that fines are an effective sanction within our criminal justice system.

Schools, Class Sizes—Teacher to Pupil Ratios

10. Hon NANAIA MAHUTA (Labour—Hauraki-Waikato) to the Minister of Education: When did she inform Cabinet of the 2 FTTE cap on teacher losses and what is the estimated reduction in the savings she has budgeted from class size increases that this policy will have?

Hon HEKIA PARATA (Minister of Education): Talofa lava, Mr Speaker. To the first part of the question, as examples and concerns came to light early in the week, a group of senior Ministers was asked to look at the transition options and spell them out earlier, to alleviate many of the concerns raised. To the second part of the question, none, because the contingency fund for transition options had been set aside.

Hon Nanaia Mahuta: How much funding has she set aside in the contingency fund for transition costs, and is this enough to cover the cost of the two full-time teacher equivalent loss cap in each of the next 4 years?

Hon HEKIA PARATA: We have set aside between $10 million and $20 million in each of the next 3 years. We are unable to be more specific than that, because, of course, rolls will not be cast until September, as the member knows.

Hon Nanaia Mahuta: Will the amount of funding to be invested in better quality teaching be reduced as a result of her announcement yesterday; and will the commitment to work specifically with Christchurch schools remain?

Hon HEKIA PARATA: To the first part of the question, no, and to the second part, yes.

Hon Nanaia Mahuta: I seek leave to table a document that shows that only—

Mr SPEAKER: Order! The member must cite the source of the document first.

Hon Nanaia Mahuta: It is from the Ministry of Education, and shows that only 14 days have been set aside for Government consultation with the education sector in Christchurch to comment on the draft education renewal recovery programme.

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.

Chris Hipkins: Did Cabinet sign off on the new teacher staffing ratios, including the policy of merging technology staffing into the general staffing ratios, prior to the announcement being made on 16 May?

Hon HEKIA PARATA: Both proposals were taken to Cabinet and Cabinet approved them.

Chris Hipkins: Did she ask for, or receive, a list of the schools that would lose or gain more than one teacher as a result of the new ratios, prior to taking the policy to Cabinet for approval; if not, why did she not ask for that list?

Hon HEKIA PARATA: We have made it clear, time and again, that 90 percent of schools can expect to lose up to one, or gain one, full-time teacher equivalent, and that 10 percent would have a greater impact.

Chris Hipkins: I raise a point of order, Mr Speaker. With all due respect, that was not my question. My question was around whether she had asked for a list—

Mr SPEAKER: I invite the member to repeat his question.

Chris Hipkins: Thank you, Mr Speaker. Did she ask for, or receive, a list of the schools that would lose or gain more than one teacher as a result of the new ratios, prior to taking the policy to Cabinet for approval; if not, why did she not ask for that list?

Hon HEKIA PARATA: I did not ask for a list of the 2,436 schools. It was based on forecast modelling of their rolls now and what they might be in the future.

Chris Hipkins: I raise a point of order, Mr Speaker. I wonder whether you would allow me to repeat the question a third time, because it still has not been addressed.

Mr SPEAKER: Order! I believe that the Minister has answered it, because I think the answer was no.

Chris Hipkins: I raise a point of order, Mr Speaker. I did not ask her about a list of all the schools. I did not ask her about the impact on all the schools. I asked her specifically to refer back to what she had referred to—the 10 percent of schools that would lose or gain more than one. That was what I was asking about—240 schools. She referred to all schools. That was not what I asked.

Mr SPEAKER: I hear the member’s point, but my interpretation of the Minister’s answer was no, and if I am wrong in that, the Minister had better correct the impression gained. I heard the member’s question and the way that the Minister shaped her answer. I cannot dictate how Ministers should shape their answer, but from the way that she shaped her answer it appeared to me that she was saying no to the member’s question. If I am wrong in understanding that from what the Minister said, I invite the Minister to answer further, but I do not think she—

Chris Hipkins: I raise a point of order, Mr Speaker. I think your interpretation of the Minister’s answer was very useful. However, it leaves the Opposition in an interesting position, where the Minister’s answer is not clear and we are left relying on your interpretation of it, because actually it is not what the Minister has said; it is what you have interpreted it as being. I actually think if that was what the Minister was going to stand up and say, that would be fine, but it is very difficult for us to go back and ask on a future date further questions of the Minister, when in fact it is not actually her answer that we have got; it is your interpretation of it.

Hon Gerry Brownlee: It is becoming quite a habit now for two things to happen. One is for the Opposition to assert that the answer given to a question was not an answer to the question asked, and for there to be some interpretation given of it. I think that is becoming a problem, frankly. But I would like to say in this case that the Minister said she did not seek a specific list of schools, and then went on to explain that the macro policy was discussed at Cabinet level. That is a perfectly legitimate answer to the most salient part of his question, which is all that can be expected.

Hon Trevor Mallard: The problem is—and I am sure that you will be able to interpret for the Leader of the House—that the Minister in fact did not refer to the 240 schools about which my colleague had asked, but to the 100 percent, the 2,400 schools. If she had referred to the 10 percent of schools or used the figure of 240, and had said she had not asked for that list, then, of course, we would have accepted the answer. The problem was that she said she did not ask for a list of 2,400 schools.

Mr SPEAKER: Order! I think this particular primary question was a very fair, straight question on a matter of some public interest, and that is why I have been quite careful to make sure answers are being given to this question—because it was an absolutely straight question seeking information. And the supplementary questions have been in pretty similar vein, and that was why I invited the member to repeat his question. My dilemma is that I cannot go on indefinitely inviting members to repeat questions, and that is why there came a point where I assisted by interpreting the Minister’s answer. I said that as I understood the answer given, the answer to the member’s question about whether she had sought information on the list of schools that would be losing teachers—how many teachers those schools would be losing—the Minister did not give an absolutely direct answer to it, and I accept that, but my interpretation of her answer was that she was actually in fact saying no in a roundabout way. When I stood and said that that was my understanding of her answer, the Minister nodded. So she has made it very clear to the House that that is in fact what her answer was saying. There is a limit to how much I can keep going back to Ministers and saying their answers are not clear. But it works reasonably well. I think that on this occasion members have got reasonably clear answers to their questions.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. I am not relitigating it at all but just now asking, going forward, whether it will be in order for members from this side, when we are submitting primary questions, to submit them in the form “further to the Speaker’s interpretation of the Minister’s answer”, because we have got an interpretation now that was not available without a nod and a wink to you from the Minister, when you made it clear.

Hon Gerry Brownlee: It probably does indicate the difficulty that we get into when there is too much generosity shown by the Speaker in trying to explain why a ruling has been made—

Mr SPEAKER: No, no. Order! I am not going to take more of this.

Hon David Cunliffe: From that generous member.

Mr SPEAKER: Order! This is a very serious matter. The question asked was straight. I would have preferred the Minister to answer the question. And the answer seemed to be very clear—no, she did not seek that information. That was very clear. Given the fact that the Leader of the House feels I have been too generous, I invite the member to repeat his question. The House deserves an answer to what was a very straight question.

Chris Hipkins: Did she ask for or receive a list of the schools that would lose or gain more than one teacher as a result of the new ratios, prior to taking the policy to Cabinet; if not, why did she not ask for that list?

Hon HEKIA PARATA: No, I did not.

Canterbury and Christchurch, Recovery—Funding for Resurveying

11. NICKY WAGNER (National—Christchurch Central) to the Minister for Land Information: What steps has the Government taken in relation to land information to further help the rebuilding of Christchurch?

Hon MAURICE WILLIAMSON (Minister for Land Information): In Budget 2012, the Government has granted a further $800,000 in new operating funding to Land Information New Zealand for the 2012-13 year so that the vital resurveying of the Canterbury region can continue. The funding, which will come from the Canterbury Earthquake Recovery Fund, will go towards restoring the survey control network that was badly damaged in the Canterbury earthquakes.

Nicky Wagner: How will the repair of the survey network help the rebuilding of Christchurch?

Hon MAURICE WILLIAMSON: Repairing the survey control network will allow property boundaries to be accurately determined. This will allow home and business owners to carry out land and rebuilding work. It will also allow infrastructure, such as roads, water, and waste-water networks, to be confidently designed and reinstated. It will also aid the mitigation and definition of hazards such as flooding due to land subsidence. The Government is committed to rebuilding Canterbury following the devastating earthquakes, and this funding will enable infrastructure to be rebuilt and will help residents plan for their future.

Tax System Changes—Children’s Active Income Tax Credit

12. GRANT ROBERTSON (Deputy Leader—Labour) to the Prime Minister: When did he first find out about the changes to the tax credit for children, such as paper boys and paper girls?

Rt Hon JOHN KEY (Prime Minister): In all its detail, last Monday at Cabinet, but changes to a number of tax credits, including this one, have been through the overall Budget process.

Grant Robertson: Is he telling the House that the first time Cabinet or a Cabinet committee considered changes to the tax system was just a few days before the Budget, or is he saying that he just did not read his Cabinet papers, or any other Budget papers, before last Monday?

Rt Hon JOHN KEY: No.

Grant Robertson: Did either Peter Dunne or Bill English inform him before the meeting of Cabinet last Monday that the tax changes in the Budget would remove the tax credit for paper boys and paper girls?

Rt Hon JOHN KEY: I do not specifically remember them using the terms paper boys or paper girls, but what they did say is that it would remove the tax status for those who earn $2,340 from PAYE income. The reason they explained that—

Grant Robertson: Why did you say Monday? Was that on Monday?

Rt Hon JOHN KEY: Do not act like a buffoon. The reason that they said that was that this was brought in in 1978, when people were paper based and small employers did not want to have to go through all of the hassle of having to record very small employees. What ended up happening in those situations was that the situation has now turned around. We have electronic systems, the cost of filing for this was about 20 percent for every person, and the Inland Revenue Department costs were over and above that, so the thing was not worth it. Only half the people took it, and the people who largely took it came from well-off backgrounds, because their families had an accountant to do it. What the Government actually has done is say to all of the babysitters out there: “Hey, good news! Now when you get paid your—I don’t know—100 bucks more than that on Saturday night for your babysitting, or 50 bucks, guess what, you don’t have to pay tax on it.” That is what the Government has done. Under Labour, babysitters had to pay tax on Saturday nights.

Grant Robertson: What has changed about his view on taking income away from children since 2008, when, according to the Manawatu Standard, he borrowed money from a Palmerston North student to play a video game and said: “Make sure I pay you back. I don’t want to take any pocket money.”?

Rt Hon JOHN KEY: We gave all of the babysitters and cash workers who earn under $2,340 a tax-free status. We did not do what Labour did in the 1980s when it brought in resident withholding tax and charged it to paper boys. I pay my debts. I remember with the Labour Party it took about 9 months to get it to pay back the credit card.

Grant Robertson: Given his lack of knowledge of these changes, and the debacle over class sizes, which of the following best describes his approach as Prime Minister to managing the Budget process: one, a spectator at a Blues Super 15 game; two, a disinterested bystander at a car accident; or, three, an audience member at a free-form jazz concert?

Rt Hon JOHN KEY: None of the above. Someone who has to come to the House on Tuesdays and Wednesdays and answer questions from buffoons like him.

Grant Robertson: I am going to be seeking leave to table a document. I know that we do not normally table news articles, but this is from some time ago. It is from 16 August 2008, from the Manawatu Standard—

Mr SPEAKER: No, no, no. We do not—the member will resume his seat. We do not seek leave to table press clippings, even though occasionally they may have some entertainment value. That is not the purpose of tabling documents.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. We did not all quite hear, but I can see that it says—

Mr SPEAKER: No, order! The member will resume his seat. Order! We have had enough of that.

Budget Debate

Bills

Appropriation (2012/13 Estimates) Bill

Debate resumed from 29 May on the .

Hon STEVEN JOYCE (Minister for Economic Development): Budget 2012 is all about investing in our future. It is a very impressive Budget that Bill English has put together with four key priorities. No. 1 is something the Labour Party knows nothing about: responsibly managing the Government’s finances. No. 2 is building a more productive and competitive economy. No. 3 is delivering better public services within tight financial constraints, and No. 4 is rebuilding Christchurch. It is a responsible Budget that creates $4.4 billion in new initiatives, $3 billion in savings, and $1.4 billion in revenue initiatives—that is $4.4 billion in new initiatives, without increasing spending. And it is a surplus in 2014-15.

Contrast that firm, solid economic leadership with the rabble that is on the other side of the House, who have absolutely no economic direction whatsoever. All they have is the three denying Davids. The first denying David, who is not even in the House today, is David Parker.

Grant Robertson: I raise a point of order, Mr Speaker. It is a longstanding convention in the House not to refer to the absence of members, which the member just did.

Mr SPEAKER: That is absolutely correct. I ask the Minister to please not refer to any absence of a member.

Hon STEVEN JOYCE: Thank you for that, Mr Speaker. The first denying David is David Parker, Labour’s so-called finance spokesman, who starts from the position of being in denial about the world economy. He is an economist who wants to assume away the global financial crisis, who wants to pretend that the biggest world recession since the Great Depression did not happen, and who wants to pretend that the Christchurch earthquakes never happened. He tells this House he is sick of hearing about the global financial crisis and he is sick of hearing about Christchurch earthquakes. Well, so, frankly, are the people of Christchurch and the people of New Zealand, but they know that that is reality. He is Labour’s finance spokesperson. He is in denial, and being in denial is no place to start from in developing an economic policy.

Then there is denying David No. 2, also known as David Cunliffe, also known as Sonny Crockett to his mates—Dave, the ham actor. He stood up big and tall in front of the New Lynn ladies club—

Hon Trevor Mallard: Point of order, Mr Speaker.

Mr SPEAKER: I can predict what the member’s point of order will be. Members must not refer to members by other than their proper names, and even in the Budget debate they must still refer to members by their proper names. I call the Hon Steven Joyce.

Hon Simon Bridges: They’re a bit sensitive, eh?

Hon STEVEN JOYCE: They are a little sensitive for that one. But anyway, he stood up tall and strong in front of the New Lynn ladies branch of the Labour Party and denied the last 30 years of economic policy in this country, his party’s role in it, and his own role in it. His economic policy is to fire-hose money around to any company or any person who walks in front of him. But it is not just money; he wants to fire-hose borrowed money around—borrowed money, borrowed internationally. He also wants to bet the New Zealand economy against the international money markets with the exchange rate. That gentleman is in economic denial. He is also in denial of what David Parker is in denial of, but God forbid he would ever be in charge of New Zealand economic policy.

Then you come to denying Dave No. 3, “David What’s-his-name”. He is in desperate denial that the other two Davids want his job. Plus there is his hungry-looking deputy, Grant Robertson, who is also seeking his job. So we have these three denying Davids, who have absolutely no coordinated approach to economic policy at all. They deny the global financial crisis, they say their economic plan is to want more jobs and growth, and then they whack increased taxes on growing businesses. That is what they want to do: they want to add a capital gains tax. The Labour Party also says it wants more growth. It says it wants more growth, and then it declares it will stop almost everything the Government is working on that would encourage growth. So whether it is convention centres, whether it is oil and gas, whether it is foreign investment, whether it is more intensive agriculture, whether it is ultra-fast broadband, or whether it is new roads—the list goes on and on of the things that Labour would not do.

Labour is also saying—and this is one that stretches credibility to the absolute maximum—that it wants to balance the books. It says that it wants to do that in the same time as the National Government, and then it opposes every piece of spending restraint in the last 4 years—every piece of spending restraint. Labour is saying that it wants growth, but then it wants to tax growth. It is saying it wants to stop everything that leads to growth, it is saying it wants to balance the books while not stopping any spending, and it says it wants to pretend the real world does not exist.

Hon David Cunliffe: What a lot of rubbish.

Hon STEVEN JOYCE: That happens to be true. That is not an economic policy; that is a joke. That is actually snake oil salesman activity.

Then you have the friends, the Greens. Every opportunity the Greens get, they say they want to return to, basically, the horse and cart.

Finally, we have Labour’s other friend, Hone Harawira, who wants jobs in his electorate, but then wants to encourage people to march against mining in the far north. So we have the ridiculous situation in last weekend’s Weekend Herald where on page 9 we have protesters, including all of Hone’s mates, against mining in the far north, and then on page 3 we have the residents of Kaikohe saying that they will get up and go over to work in the mines in Australia. That is the trouble with that side of the House. It has absolutely no idea of cause and effect between what you say in this House and the impact it has on the economy.

That is in contrast with this Government and Bill English’s Budget, which is working hard to grow the New Zealand economy. The Budget addresses a number of things that will help develop the New Zealand economy. No. 1 is infrastructure. It will be one of the things that this country will look back on in terms of this Government, saying that it kept investing in infrastructure during tough economic times, and we are. We are investing billions to get the country moving more quickly. We are investing $12 billion in the high-use highways around New Zealand. That was opposed by Labour and opposed by the Greens. One thing we could be sure of is that if those parties ever got in, none of it would be happening.

We are also investing $1.35 billion to roll out ultra-fast broadband and an extra $300 million for the Rural Broadband Initiative. We are also investing $2 billion to upgrade the metro rail systems in Auckland and Wellington. Labour wants to spend more, of course. It wants a 35c return on every dollar spent; that is the quality of economic analysis in the Labour Party. We are also working hard on the capital markets by encouraging New Zealanders with their opportunities to invest in the mixed-ownership model companies. That will help kick-start New Zealand’s capital markets, and the Labour Party does not want any part of that either.

Another area where we are working to grow the economy is in skills. We have made some great progress there, and Labour hates it. We are funding the highest number of core tertiary places ever—13,000 more in 2012 than in 2008. We are also funding for performance, for completing qualifications and courses. “Bums on seats” is finished. That went out with Labour members, and the door kicked them in the bum on the way out.

We are also getting excellent results for priority learners like Māori. There are 5,500 more places at university for Māori than in 2008, and completion rates are up. Finally, we are getting great progress in literacy and numeracy. This year 122,000 people are taking embedded literacy and numeracy in higher-level education around New Zealand, which is up from 36,000 just 2 years ago.

Then we go on to what is in this Budget. There is $42 million worth of investment to increase engineering diplomas and graduates—

Grant Robertson: Where does that money come from?

Hon STEVEN JOYCE: —over the next 5 years, building to 500 a year. Mr Robertson hates it. He does not like engineers. Labour never invested in engineers. We are also investing $100 million more for research at universities, we have 3,000 more Youth Guarantee places, and we are also putting $17 million into extra investment in science at universities. On top of that we are investing further in research and innovation across the New Zealand economy, from basic science to applied science and to firm-led innovation with the Advanced Technology Institute. It is a massive amount of money and it leaves those tired, old research and development tax credits in the shade. The spend on research and investment goes up from $1.16 billion to $1.24 billion this year, up from $1 billion in 2008-09. It is an increase of 17 percent in 4 years. I am proud of the Government, which invests in science and innovation. [Interruption] Those members wish they were us. They wish they were us.

This Budget is balanced and sensible. It is about investing in New Zealand’s future. It is about responsibly managing New Zealand’s finances while building an innovative, productive, and competitive economy that sells more to the world, supports more jobs, and delivers better public services in constrained times. It is about returning to surplus in 2014-15. It is about continuing to protect the most vulnerable New Zealanders with Working for Families and New Zealand superannuation, and encouraging and supporting beneficiaries into the workforce. It is about investing in the rebuild of Canterbury. The National-led Government is delivering on all the promises it made to New Zealanders at the 2011 election, and it is working hard to ensure a brighter future for all New Zealanders.

JACINDA ARDERN (Labour): Is that as good as it gets from the National Government—

Andrew Williams: I seek leave of the House to table a document prepared by the Parliamentary Library, The Government Operating Balance 2002-12, showing the true surpluses and deficits in the last 10-year period, which includes 4 years under the National—

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

Andrew Williams: Not surprised.

Mr SPEAKER: Order! The member will not comment like that again.

JACINDA ARDERN: Is that still as good as it gets from the National Government’s presumed powerhouse that is Steven Joyce? The best we had from Mr Joyce was a few laminated, Durasealed PowerPoint cards of what the Budget has delivered to New Zealanders—some flash cards, if you will, to remind Mr Joyce of the supposed high points of the Budget that the Government has recently delivered to this nation.

As we all in this House know, a Budget is not just a statement of the Government’s accounts. It is setting out a direction—a plan, if you will—as to where this nation is going, not just next year but in the years to come. Under those terms this was not just a zero Budget; it exposed to New Zealand and New Zealanders that there is zero plan for New Zealand and, therefore, zero hope for those who need it. And who needs it? Who needed this Budget the most? Well, just today Unicef tabled its scorecard on child poverty, and in some respects it simply reminded us of our national shame. Between 170,000 and 270,000 New Zealand children live in poverty, and that is according to international measures, much as the Minister would choose to deny those clear statistics. We now rank 20th out of 35 OECD nations when it comes to child poverty. We sit alongside countries like Estonia and Slovakia when it comes to child poverty rates. Those nations too have experienced a recession and economic hard times, but those who sit above us in this league table have at least acknowledged that it comes down to priorities and it comes down to leadership with our most vulnerable. This Budget acknowledged neither of those things. In fact, for the next generation it has removed their future.

But this is not the first time that we have experienced this in a Budget. In fact, I felt a sense of déjà vu when I sat through the reading of Mr English’s Budget speech. I reflected on the last time that I had this sense of déjà vu. I was sitting in the House last term scanning through Bill English’s Budget speech when I stumbled across a paragraph that stood out more than all the other puffery, and that was about superannuation. For me that paragraph was emblematic of the failure of this Government and the whole point of our being here as politicians. Unlike the other side of the House, I do not see us as a group of ad hoc board members here to govern New Zealand as part of a career plan. I believe that we are guardians, and, by definition, it is incumbent on us to leave this place better than we found it, and that means making hard decisions. On that measure this Government has absolutely failed.

It has failed the next generation, and in what ways? Let us start with its supposed inheritance. Our country currently has a dividend-returning asset base in the form of power and energy companies. That is an asset base that gives us a steady flow of income that we are about to strip away from the next generation, which currently owns it. Not only do I find this deeply offensive, but I find it deeply personal. I remember the last time that this happened in our nation. I remember the last time that it happened, not because I was a mum and dad investor, but because I lived in a community that suffered deeply from a Government that forgot why it was there and what guardianship means.

So now that we are watching the next generation’s inheritance being stripped away, what more can it hope for? Social mobility, perhaps. There is an idea in New Zealand, at least, that if you can dream it, you can achieve it. After all, we pride ourselves on being the country where you can start life in a State house and become a Prime Minister. I am afraid that the very child who achieved that goal in life is now presiding over a Government that is willing to sit idly by while every indicator suggests that the fair and equal New Zealand that he grew up in no longer exists. This Budget did absolutely nothing to fix that and it did nothing to help our kids.

When this Budget was introduced, one in five kids was living in poverty, and nothing will change. Two out of five of the kids living in poverty are in the houses of the working poor, and after this Budget nothing will change. Notifications to Child, Youth and Family have increased to 150,000 a year. We know that when it comes to our most vulnerable kids, poverty is the cause of the causes, and today nothing will change. Preventable hospitalisations have increased due to cold, damp houses. Infectious skin diseases are up because families cannot afford hot water and washing machines, and today nothing will change. What about our brilliant education system? Sadly, 20 percent of kids in that system are failing, and the Government’s response to that was to increase class sizes and make it worse.

Let us be absolutely clear. This Government might think it is on track to reduce the deficit, but that is coming at a cost in ways we have not even seen yet. The Children’s Commissioner puts a number on it. He claims that for every child who has a poor start in life, it will come at a cost of $1 million per child later on in life. Unicef has added to that figure and that message today; its report stated that “failure to protect children from the impact of poverty … is one of the most costly mistakes a society can make.” We desperately needed things to change for our kids in this Budget, and they will not. Even if the Government wanted to ignore the morality issues around leaving a whole generation behind, there are, of course, the fiscal ones. Our population is ageing. We need an educated, healthy, thriving set of kids to be taxpayers in the future, and they need us to be their guardians and to make the right calls on their behalf.

So what are those hard calls? Well, first, there are our incoming bills. The Government has decided that the biggest one that we need to worry about happens to be tertiary education. Rather than seeing education as an investment, a public good, its policy will narrow the eligibility of young people for allowances. I know of a current graduate studying to be an educational psychologist to work with deaf students—an area of serious skills shortage in New Zealand—but she is being left with no choice but to end her studies, as a result of the Government’s policy.

And what reasoning have we seen for this policy change by the Government? It argues it is all about the sustainability of tertiary education. But why is it that if there are sacrifices to be made and questions about sustainability, it is young people that it lands on time and time again? If this Government was genuinely interested in issues of sustainability, it would look first at superannuation. In 3 years superannuation will cost more than the entire education budget. That includes primary, secondary, early childhood, and tertiary education put together. It will grow to 20 times the cost of unemployment benefits. We need to ask the question of whether the universal age of superannuation is set at the right place. But rather than tackle this big issue for the sake of future generations—future generations who want a secure home, a secure retirement, and a country with a sound savings plan—the Government has ignored it.

This is not just a zero Budget, this is a Budget with zero hope, and it is also unfair. It has also come at a cost. We cannot burden future generations and not pay for it. That cost is young people lining up at our departure lounges—1,000 a week. Everyone in this House will know someone leaving these shores for a job and a better income. Why? Well, 52 percent is the increase we have seen in unemployment, and that has hit young people heavily. A lot of those are our graduates. They fulfilled their end of the deal. They went out, they got educated, and they took on debt to do it. The Government’s job was to make sure a job was there when they needed it. On that front, the Government is failing.

At the very least, those young people deserved a Budget that produced a plan: one that introduced pro-growth tax reforms so that income is fairly taxed, no matter how it is earned; one that tackled the hard issues, like superannuation and lack of savings; one that brought back research and development tax incentives to attract more investment into science and innovation; one that brought in new apprenticeships and closed our skills gap; and one that gave a fairer deal to our exporters. But this Budget did not present this plan, and it does not present any hope. The result is The GC.

This Budget fails our kids. It fails our young people. It is not just that they are being ignored; they are being pushed back and laden down with the cost of this Government’s political expediency. Intergenerational inequity has to stop.

Hon CRAIG FOSS (National—Tukituki): I am just not sure whether I heard the last bit of the previous speech from Jacinda Ardern right. It was: “The Budget was impact and made the GFC.”, or something, I think. That was an appalling description of—I do not know what, really.

We started off, maybe, quite well. The member previously said a measure of a Government is for it to leave the country better off than it found it. Well, actually, I have higher aspirations than that, but I take that as an apology for the previous 9 lost years of a Labour Government, because Labour most certainly did not leave the country in a better state than it found it in in 1999. This Government is well on track to leave this country in a better state than the one we inherited, as we go through our various terms. For example, household incomes and after-tax incomes are up under this Government. It is giving families, New Zealanders, more choice in what they do with their spend, be it pay their mortgage off, look after their family, or do whatever else, rather than having the Crown, the Government, the State coming in and overtaxing them. We must recall when mentioning tax that half of New Zealanders fell in to and were fiscally dragged up to the highest tax bracket under the previous administration.

When the previous Government left office, crime was rising. Crime was higher than it was when that Government arrived. Crime is declining. The most violent crime is declining under the hard watch of this Government and under the hard choices this Government is making. It is easy to talk, as that member talked endlessly, but actions are where it counts. Crime in this country is declining to the point where we are saving about $1 billion because we do not have to build one additional prison, as a result of some of the decisions that this Government has made. We must remind ourselves that the policy of the previous regime for some time was to save on prison beds. I do recall that it was known as “catch and release”, to try to free up beds, as opposed to building the “Milton Hilton” down south.

If a Government is to leave New Zealand better off than it found it, well, I would take that as a measure of pouring resources and focusing them into the front end, to where it counts: in health, operations; in education, educational outcomes; in crime, more police. I could go on and on. In health, waiting lists. There is more elective surgery happening quicker than ever before, rather than the “secret squirrel” silly games of waiting lists, and there is upfront declaration, where the public can hold their district health boards to account. That is what we are doing to continue to leave New Zealand in a better place than when we inherited it.

I come to the Warm Up New Zealand campaign. The member started to go on about respiratory issues. Well, actually, in conjunction with the Green Party over there, the Warm Up New Zealand campaign has put in insulation and made many New Zealand families safer and healthier. Their homes are in a better state than the economy that we inherited.

I take great offence, because any child in this country should and could dream about being the Prime Minister, regardless of their background. The difference between this Government and the previous Government of the members over there is what we believe the potential of our people can be, rather than having them dependent upon an ever-growing State for ever after in that poor child’s life, which is exactly what we saw in the previous regime.

Budget 2012 continues the prudent, sensible management of the economy that we inherited. I would say the Budget is courageous. It is just as courageous as the zero Budget, or the flat new spending Budget, we had in election year last year, for the first time ever. I congratulate the Hon Bill English on once again delivering prudence, delivering savings, and, yes, making some tough choices. But in this world, tough choices are demanded. It takes courage and leadership to make those choices.

Europe is casting a shadow across the globe. Debtor nations such as New Zealand must keep their books in order. New Zealand owes the world $180 billion. The world is competing for capital. Capital is being written off in Europe. New Zealanders see what is going on in Greece on their TV screens every night, and New Zealanders are in tune, as this Government is in tune, with what they are doing in their households every single day: managing the money as tight as we can, pulling the discretionary spend down, paying off debt, being prudent, and reprioritising. We cannot live the lie that we are a creditor nation. This is not Switzerland, as some members opposite constantly seem to believe.

Mr Parker, in his various speeches, said that he is getting sick of hearing about the earthquake. As other members have noted as to that point about Christchurch, that is somewhat of an insult. But the Budget is actually an economic document, so I will talk about economics. Mr Parker is sick and tired of hearing that the impact of the Christchurch earthquake is 9 to 11 percent of our GDP. It is 9 to 11 percent of a $200 billion - odd economy, and he is sick and tired of hearing about it. Well, that speaks volumes about that member’s thinking about where everything is, and perhaps that is why Mr Cunliffe is constantly giving out finance spokesman - type press releases to the general public.

Europe is casting a shadow across the world, and yet members opposite are still going on about fixed exchange rates, for goodness’ sake! We are seeing what that means to a country such as Greece, which is unable to let go a steam valve for the various pressures it is under. Yet members opposite rave on about monetary policy, fixed exchange rates, etc., and about what happened 30 or 40 years ago. They are in constant denial.

I understand that the Labour Opposition at least, and maybe one or two of its partners, is voting against the Budget and the Budget speech as outlined by Mr English. Well, I would just like to remind the House of a couple of things that those parties are, therefore, voting against by doing that. They are voting against the Future Investment Fund. They are voting against $1 billion of investment in 21st century schools. They have the audacity to stand up and make complaints about our education system, yet they are, I believe, going to vote against $1 billion of investment in New Zealand’s 21st century schools. How on earth can they look their kids in the eye—excuse me, members; I did not mean to bring personal issues into it. How on earth can they look kids at school in the eye as they go around and discuss what is needed in education?

I am proud of what we are trying to achieve in education. Minister Parata has her finger right on the pulse. Yes, we have the most awesome education system in the world, but it is failing 20 percent of our populace. Our education system is failing 20 percent of our kids. If members opposite have a problem with that fact, I would like to point out that the same kids who are coming to the end of their secondary education were at school when some of the members opposite were in charge of that portfolio, and those same kids are unable to read and write. They are unable to pass level 2 National Certificate of Educational Achievement. They are our most vulnerable: our Māori and our Pacific Islanders. Members on the other side have the audacity to get up and say something in Samoan Language Week, and yet they do not really applaud and celebrate what we are trying to do to fix that cohort and to have better and brighter teachers so that every single one of those kids may one day aspire to be the Prime Minister of New Zealand.

We announced some KiwiSaver changes in the Budget. I believe that members opposite will also be voting against them. There are options for people to compare KiwiSaver accounts and performance. The public should know that the Labour Party is going to vote against the ability of New Zealanders to compare the performance of their KiwiSaver funds. That is what Labour is going to do.

Hon Trevor Mallard: That’s not in the Budget.

Hon CRAIG FOSS: That is what they are doing. It is announced in the Budget. You must read it. At least Jacinda Ardern said she had read it. That is what Labour is voting against.

Grant Robertson: That’s not in the Budget.

Hon CRAIG FOSS: Labour is voting against it. Those members could at least get up and say, perhaps, that that policy is not a bad thing but that they disagree with some other policies. That would be more respectful. I suggest that that would be somewhat more in tune with New Zealand, unlike the policies we are hearing now from Labour. By the way, most of them were put before the electorate last 26 November. We are hearing the same policies from the same members, although there are fewer of those members now, yet they are still in denial. They forget that in many of their own electorates, National won the party vote on the exact policies that we are implementing right now.

KEVIN HAGUE (Green): Every society around the world is facing challenges in its health services, because health services are some of those services that people look to their Governments to provide. They are one of the core things that Governments provide. Yet the capacity of technology to provide more and more health services greatly outstrips the ability to pay for those services. So every country is facing big challenges around how best to put up the money that is required for health services, how best to distribute that money, and how to decide what it is used for.

In this country there has been for some decades, actually, a consensus that investment in health services should be rebalanced towards public health services designed to keep people well in the first place, and primary-care services designed to deal with people’s health needs in the community, and as early as possible in their disease progression. This is for a variety of reasons. It is best for the individuals to not get sick in the first place or to be treated early, but it is also because all of the evidence from the health economists suggests that investment in that part of the spectrum of health services provides the best return in health gain on the dollar spent.

There has been a consensus to do that, and yet in this Government with this Minister of Health that consensus has been thrown out the window, because this Minister of Health is driving the investment in the other direction. Tony Ryall, Minister of Health, at the point that he leaves that job—I think that will be in 2014—might well be advised to seek a career on the stage as a magician. He accomplishes that magician’s trick of diverting attention away to this glittering prize over on his right-hand side, while at the same time with his other hand he is pulling away the nut below the cup that is left on the table—out of sight, out of mind. That is what he has done with health.

When Tony Ryall was the Opposition spokesperson on health—and as Chris Auchinvole, I think, was saying earlier in this debate—he made a great job of talking about elective services. He talked about waiting times for elective surgery and about the number of people waiting. He made it seem as if that was the main thing that health services provide. In fact, it is about 5 percent of what health services do. What he has done since he has become Minister is he has actually, and I agree with Craig Foss, seen more resource go into elective surgery. There has been more elective surgery done. People are waiting less time for elective surgery. In this Budget he has done the same thing again. In some places around the country, district health boards practically have to ambush people on the streets—to pull them in—to give them elective surgery! But certainly more people are getting it. Indeed, there is more money for cancer services and more money for cardiac services. But that is accomplished at the expense of everything else in the health sector. That is the cost. The cost is less service, and, in particular, less service in the areas that we know provide more health gain.

The broader context is that health services are faced not only with the Consumers Price Index but also with medical inflation, which tends to be somewhat higher. They face wage settlements that are higher than the average wage settlements, because of the workforce crisis that we are experiencing and the higher rates available overseas. They face one-off hits, like the unfunded changes to KiwiSaver that the Government made in its Budget last year. They face the costs associated with an ageing population, and we know that older people need more health services and we need to spend more money on providing services for that group. We face a growing population with all of the costs associated with that.

When we learn that Vote Health has increased by just 2 percent—in other words, basically the CPI—we know the subtext is that health services have been underfunded. The careful calculation of all of those factors that I have just listed suggested that for district health boards to tread water, to be able to provide essentially the same set of services at the same intensity as they have been doing, in this Budget they required another $465 million. That is an increase of about 4.4 percent. What the Government actually delivered in this Budget was an increase of $319 million, leaving district health boards basically $150 million shy of where they needed to be to retain the same level of service. The Government says that that will be met by increased efficiencies, trimming the fat, and increased productivity, but what everybody in the health sector knows is that that will be met by cuts to health services.

Every day we dig further into the individual budget lines in the health budget and we come up with new gems that illustrate some of the detail of that service erosion—for example, in the area of clinical training. I have already mentioned the workforce crisis that health services face, yet in that environment the only area in which training received a significant increase was midwifery training. Most other areas of clinical training essentially were unchanged. So medical training is essentially unchanged, which will be astonishing for those working in the medical profession. For those working in the nursing profession, the news is worse. The money for nursing training is actually decreased in this Budget—actually decreased. The money for Māori workforce development is actually decreased. Those are some of the ways that the Government is funding that increased elective surgery.

Some of the cuts are going to be the axing of whole programmes, and we have seen that in the past few years. That is one of the things the Government does. Whole organisations that have been providing services are no longer doing it. Their programmes are completely gone. But a lot more of it will be in the area of what we might call slow-burning cuts, where gradually the cost of providing services is transferred from the State to the people who need those services. In this House—I guess, technically, it was last Thursday—we were debating the Government’s unheralded change to the asset-testing threshold for aged residential care. That is one of the ways in which the Government is subtly and behind the scenes trying to transfer its responsibility on to private citizens.

Another example was the increase in the cost of medicines. It may seem like a small increase, but for the families that are really struggling and wait until lots of their kids actually need services before they go to the doctor, and who try to get multiple conditions for each of their kids dealt with, they will find that that prescription with multiple items—each of which is going to have the increased cost—will put them back into the situation where they have to decide which of the things on the prescription they get filled and which ones they decide to leave.

So this is a Budget that will see increased cancer services, but also a cut to the services designed to stop you getting cancer. It is a Budget that sees district health boards $150 million short, but $150 million being provided for the refurbishment of the high commission in London. It is a Budget that sees no action on the workforce crisis. It is a Budget that sees no action on the increasing rates of preventable hospital admissions, particularly for Māori and Pacific Island people. It is a Budget that actually locks in inequality and sows the seeds of poorer indicators of illness, of disability, and of death in generations to come. It is a failed Budget.

Hon MAURICE WILLIAMSON (Minister for Building and Construction): I intend to title my speech today “Contra vera nihil obstat”, which is Latin for “Against fact there is no argument.” Today I want to present just a few facts to the Labour Opposition that I think will fair and squarely contradict so much of the waffle and the debate that has gone on without actually allowing the facts to ever interfere with a good story. I was proud to sit in this House for my 25th Budget in the Parliament, and to listen to Bill English present a Budget in some of the most difficult economic times I have ever experienced in this country, and to still keep the ship well and truly afloat, with a good direction on it, and with a good forecast for the future. It is not a future like Greece has got, not a future like Portugal or others that are on the verge of straight collapse have got, but actually has things like growth rates. I want to remind members of them, because I was looking through the comparison of growth rates, and for those people out there who do not think economic growth matters, you are wrong. Economic growth is vital for a nation, or you will never be able to fund the services such as education and health that are required. So I had a look at the world’s economic forecasts for growth, and I think they are really important.

In the Budget we are forecasting, even with a zero Budget and all the constraints that we face, around 3 percent economic growth per annum. You would have to say, if the others were doing 4, 5, or 6 percent, that New Zealand is a failure and we should be embarrassed. So I had a look. Let me have a look at the growth rates that are forecast. In Europe—and I am talking about Europe as a whole—the whole of Europe’s economic growth forecast is for around 0.5 percent. That is a sixth of what we are forecasting. The United Kingdom is doing a little bit better; it has about 1 percent economic growth—1 percent. Japan, that mighty economic powerhouse of the past, has 1.5 percent, and the United States and Canada, which again are countries we used to look to and go “Wow!”, are on just 2 percent. At a time when New Zealand has come through some of its worst economic conditions, when the global financial crisis has wiped out a whole lot of the financial institutions and others, to be forecasting 3 percent growth is outstanding.

I want to remind members what the four key priorities out of the Government’s policy and out of the Budget were, and then go through them. First of all was the responsibility for managing the Government’s finances. I think that some of the initiatives that Bill English has taken in recent years, such as the tax switch, have been fantastic for this nation, and I am really proud that we have done so. What I want to do is counteract a few of the absolute myths that lie out there about our tax system. You know what the one is that I bet you members on this side of the House hear almost daily? It is: “I reckon the rich should pay more—I reckon the rich should pay more.” Well, let me give you the numbers, and these are out of the fact sheet from the Budget, so that members can work out whether that is true or not. If we take the number of people in New Zealand who earn over $150,000—oh, and by the way, I had better make sure that these numbers do not include the Working for Families subsidies coming back, because they would make these numbers even worse, in terms of what I am about to tell the House. If we take those people who earn over $150,000 in this country, there are only 2 percent of income earners who do. Only 2 percent, and what do they pay of the income tax take? Nineteen percent of the income tax. If you want to take the cumulative effect—

Michael Woodhouse: Well, fair enough.

Hon MAURICE WILLIAMSON: Yes, it is fair enough, but do not argue that the rich do not pay their share—do not argue that the rich do not pay their share. Two percent of income earners pay 19 percent. Let us take the cumulative numbers for the $100,000 and above category; there is a bigger number in that category. About 6 percent of all New Zealanders earn over $100,000, and they pay 34 percent—6 percent pay 34 percent—of the tax. I am not saying that is wrong—

Hon Annette King: Yes, you are.

Hon MAURICE WILLIAMSON: No, I am not. I am not saying that is wrong. What I am saying is do not say that the rich do not pay their share, because 6 percent pay 34 percent, and that member had better get with the programme. Let me say again that if you put the corrections for the transfers back to the lower incomes of Working for Families, those numbers get even worse. Based on a calculation I saw from David Farrar last year, when he put those payments back into the schedule, it comes to something like the top 10 percent of income earners paying 90 percent of all net income tax.

I have to say that this Budget was a great Budget, but for a number of other reasons. For example, the Government has decided that there are areas where we could really put in some expenditure and get a fantastic return. One of those would be science and innovation. I was really, really delighted when I heard the finance Minister reading the Budget and putting $385 million over 4 years into science and innovation. That is more than $1.3 billion a year we will now be spending. That is a $385 million increase, so we will be spending about $1.3 billion a year by 2015-16 on science and innovation, developing products, developing services, and developing smart things we can sell to the world. There is not a member of this House who does not accept—actually, no, I exclude the Greens, because on “Planet Green” they do not accept even this—the idea that New Zealand can make its future only by selling at the high end of the value-added product line, and we will never make our existence or our survival by selling at the bottom end of the whatever.

If I talk about the parties and their views a bit, what I want to talk about now are those sorts of big headline issues. In the Budget and leading up to the Budget for the last few years the National Government has made some very strong calls about making the economy work. First of all is intensification and development of our agriculture sector—things like irrigation. If members do not understand the impact of irrigation, they need to just go out and start watering a bit of their grass for a few days, just in the same spot, and watch what happens to the productive nature of land if you can irrigate it. If you can irrigate huge tracts of the South Island, for example, using the water from the rivers and so on, guess what? That is where we would get our economic growth. That is where we would get our ability to pay for a whole lot of the services that members of this House want the country to have, yet the Labour Opposition and the Greens on “Planet Green” are all opposed to intensification and opposed to the irrigation schemes.

Now we come to one of the things that I think is a real cracker here. We, regularly as clockwork, get from the other side of the House the comparison with Australia, about how well Australia is doing and how hopeless we are getting—you know, that “Planet Australia” is just booming, and “Planet New Zealand” is failing. Well, guess what? Wayne Swan, Australia’s Treasurer, will tell you this if you ask him. He will tell you straight away that the biggest driver of the Australian economy is mining and mineral resources. In fact, they openly admit across the Tasman that they have got a dual economy. Their normal economy is pretty flat. It is pretty dull, there is unemployment, and it is struggling. But what is bringing them into the sunshine, what is keeping them going, is their minerals and their mining. Well, I agree with Wayne Swan. I cannot believe I am saying it, but I agree with a Labor Minister in the Australian Government. Wayne Swan was right. But what do we get here? We want to compare ourselves to Australia, we want to have the same levels of employment, and we want those young unskilled Māori and Pacific Islanders to have jobs, but, oh, we are not prepared to mine any of our minerals—no, no, no! We will let them do it. Well, guess what? Where will those young people go for a job? They will have to go there if we cannot do the mining and mineral exploration, and no wonder there is a drift because of that limitation.

And then we get members in this House saying how dreadful welfare reform is. I do not know how anybody can think that the social welfare system we have right now, which is paying hundreds of thousands of working-age people to do nothing, is acceptable. I agree with a welfare system being there to help the vulnerable. I agree with it being there to help those in need. I agree with it being a handout for only a short period, but it has to be a hand up over a longer period. I congratulate Paula Bennett, the Minister for Social Development, on the work she is doing, trying to get some real sanity into our welfare debate and trying to get some real outcomes so that those people on welfare are actually looked after. I think this is a great Budget. I am proud of it, and I am delighted.

Hon RUTH DYSON (Labour—Port Hills): I want to commend the member who has just resumed his seat, Maurice Williamson, for 10 minutes of serious repetition of the National Party line. That was extraordinarily well repeated, Mr Williamson. I know he is in the competition to replace the Rt Hon Lockwood Smith when he takes his vacation, when we are joined in the House by—I am sure he will soon be, after he returns—the “Hon” Aaron Gilmore, who is escalating rapidly in the stakes in the National Party. A lot of the time that the National members have been taking the calls, they have been crowing that Labour members are voting against the Budget, and that means we are voting against the asset sales programme. Well, I just want to confirm that. Labour is voting against the Budget, and we are voting against the asset sales programme. Just in case anyone in the country is in any doubt, Labour does not support National’s asset sales programme.

Tragically, that is about all that is in the Budget. That is why it is quite correctly being described as a zero Budget. At the end of last week this House went into urgency to discuss the critical measures that were contained within the Budget. So what did the House do? We passed three bits of legislation. The first one rattled, upside down, the poor young paper boys and paper girls of New Zealand. It turned them upside down, held them by their ankles, and shook them until their pocket money came out of their pockets and into Bill English’s hands. Mr Key described them as “small employees”. Those of us on this side of the House do not call them small employees; we call them children, actually. They are young people in New Zealand, and they earn a tiny little bit of money. Up until the Budget last week they could keep it all; now they have to pay tax.

That was the first big initiative in the Budget. What a great leap forward for New Zealand that was! What a vision from John Key and Bill English that we saw: “Let’s get the money out of the pockets of the paper boys and the paper girls.” It did not feel very visionary for me. It did not sound as if the National members who spoke during urgency supported it, or could feel a vision, either. But, nevertheless, that was the first big measure.

What was the second? Well, the second big initiative in the Budget—again, passed under urgency—was to reduce the support for tertiary students. That was the second big, bold initiative. It was no doubt rammed through Cabinet by Steven Joyce. I do not know whether he shared as much information with his Cabinet colleagues as the Hon Hekia Parata did, but if he did, he will be in bother later this week as well, because nobody in Cabinet knew the details of the education budget cuts. I am not sure the Hon Hekia Parata knew them, actually, until teachers and parents drew them to her attention. So that was the second big, bold initiative: “Let’s cut the support for tertiary students.” In bad times the most important investment that a Government can make is investing in the skills, the training, the education, and the employment of our citizens so that as we come out of the bad times we will be better off. But, instead, for 4 years in a row, this Government has cut back on that.

The third big, bold initiative in this zero Budget—what was it? I am sure that everyone in the House remembers the debate from last Friday. Certainly, every Grey Power member around the country remembers the debate and will be reminding National members of it. It was to freeze the asset threshold—not a little tinker, not a minor reduction—so that instead of the annual $10,000 a year increment in the amount of assets that could be retained by a person going into a rest home or a hospital-level care facility, that is now frozen at CPI. So out of the pockets of young people earning a little bit of pocket money, out of the pockets of tertiary students, and out of the dressing gown pockets of rest home residents, the Government shook a few miserable dollars and said: “That’s it; that’s our vision.” Well, no wonder hundreds and hundreds and hundreds of New Zealanders—good New Zealanders, people we want and need to stay here and contribute to our communities and our nation’s future—are saying: “Forget it. There is nothing here for us. This is a Government with no vision, giving us no hope for the future. We are on the next plane out of here.” Record numbers of people are leaving our shores permanently to go to Australia.

Mr Williamson said: “Judge us on our financial management.” Nothing would give us more pleasure, actually, Mr Williamson, than doing that, because every year the Prime Minister and the Minister of Finance have overpromised and then failed to deliver. You can get away with it once, but you cannot get away with it every year. You cannot promise more than you are able to deliver, be shown to have failed, and then try that same trick again. New Zealanders are not foolish. New Zealanders can read the record of this Government. Last year, for example, the Prime Minister said we would have 4 percent growth; 4 percent growth was what he promised New Zealanders. Now he is projecting just over 2.5 percent in this year’s Budget. That is quite a difference. The Hon Maurice Williamson can do the sums quite easily, I am sure. The difference between 2.6 percent and 4 percent, when you are talking about economic growth, is quite a lot. The difference between misleading and promising is very narrow in the way that the Prime Minister does it.

Last year the Prime Minister said we would have 170,000 additional jobs, and this year that has been cut in the Budget commitment by 16,000. They are not numbers, they are not figures, and they are not statistics; they are people. They are people who want and deserve a job. Maurice Williamson has got the audacity to say that people are being paid to do nothing. They do not want a benefit, Mr Williamson; they want a job. They want a job, and if there was a job on offer, they would take it, as they did in their thousands when we were in Government and supporting employers, supporting the export sector, and supporting innovation within our business community so that more jobs could be available for the people who currently are stuck on a benefit, with the only choice available to them being to stay on the benefit or leave our country. That is not a vision that I think is good enough for New Zealanders.

Last year the Prime Minister said real wages would grow. This year we see it peaking at 1.6 percent and then declining. So not only are people not able to get jobs—thousands more than previously—but when they do get a job their wages do not even keep up with the rate of inflation. New Zealanders and our nation deserve better than what we are being offered. We want leadership. We want leaders with the ability to look at the hard decisions that are confronting our country, to engage in a public debate, and to come up with real solutions—not re-pose questions or stick to tired old outdated arguments but come up with real solutions for the future.

A surplus in the Government accounts is important. Labour maintained it for a long time and was consistently attacked by the National Party for not spending more money. We said we wanted to maintain a surplus for that rainy day, and it came in buckets, and the National Government blew it all. It did not save any money to invest in New Zealanders. It blew it all on tax cuts for the highest-income earners—the people who did not need that additional money—and at the same time put GST up, which hurt the most vulnerable people in our community.

The Budget is about choices, it is about decisions, and it is about providing a vision. This Government has given us no vision. It has given us a zero Budget. The choice it has made is to rattle the money out of the lowest-income earners and make them pay tax, to stop additional support for tertiary students, and then at the other end of the age scale, it has rattled the dressing gowns of our most vulnerable senior citizens to get a few extra dollars out of them. The Government calls that a vision. It calls it leadership. It is neither. It is a zero Budget, and New Zealanders deserve better.

MAGGIE BARRY (National—North Shore): Talofa lava. Malo le soifua. I rise—and I am very happy to rise—to speak in support of Budget 2012. I represent the people of the North Shore, and my constituents like this Budget because they are an intelligent, aspirational community who understand only too well that when times are tough you have to cut your cloth accordingly. It is the right Budget for these difficult and tough economic times, and its measures are prudent and sensible and will result in the kind of moderate growth that this country needs as we move towards getting the books back into surplus.

Opposition members are, of course, and are, indeed, the no-hopers—the chattering classes. They have taken more than enough of our time with their foolish preoccupations with the minutiae, the pickpocketing, the paper boys, and tipping old people upside down in their dressing gowns. Many of them should just retire and do us all a great favour, actually. We are going to put aside that nonsense, because more than enough time has been spent on it already. Let us actually look at the facts of this Budget. I know that it is uncharted territory for the Opposition, but as we in this Government chart our course back to surplus we have indeed developed and delivered a zero Budget. We are sticking to our plan because it is working, and that does not mean for a moment that we are not investing in and growing our economy. We are saving and reprioritising where we can, and continuing to spend in the priority areas that are vitally important for New Zealanders and for this economy’s growth.

There are four main areas I want to talk about today. There are many winners in Budget 2012, and overall we have progressed our aim of funding front-line services. Let us start with health. Minister Tony Ryall, I believe, is to be congratulated not only on achieving milestones with immunisation targets, which are vitally important for our young people and for our future, but also because under his watch there have been 27,000 more elective operations. That is 500 extra a week, compared with what we were able to do in 2008, after 9 years of a Labour Government. We have, as a result of some slight increases in prescription charges and from savings in health and across all of our Government accounts, made an extra $1.5 billion available to go into health services. This is an excellent achievement for Budget 2012. It means, in fact, that there are more funds going into district health boards, there is more elective surgery, and there is better cancer treatment. For anyone who has been through the health system in New Zealand, I think they would fully approve of the move to put the extra $33 million into faster services, and particularly for dedicated nurses who can coordinate care for patients. This is a vital need that has long been required, and now we are delivering on it.

When we look at welfare, we all know that too many New Zealanders are welfare dependent—families trapped in poverty—which is costing us all far too much. Something like 12 percent of our working-age population is on a benefit. Unlike the Opposition, we believe that those who can work should work. We want to support them off welfare and into jobs. So in the past 3 years we have created an extra 60,000 jobs, against a backdrop of the global financial crisis, the Canterbury earthquake, and, of course, the complete mess that Labour left our books in after its profligate spending over nearly a decade. Minister Paula Bennett has ushered in Future Focus, which has saved around $17 million. She has introduced payment cards for teenage beneficiaries, to help them make better choices about their budgeting and not blow their money on booze and cigarettes instead of the rent. For welfare, we are investing in this Budget over the next 4 years $287.5 million to support those on welfare going into work, and that is going to save the taxpayer $1 billion in benefit payouts. There is $80 million being ploughed into early childhood education childcare places, because we believe that investing in our very young is vital for the future of this country. There is a further $55 million for dedicated staff who can support job seekers and sole parents back into work, because they need help. It is not going to happen by itself. It is vitally important that the front-line services are improved, but they need to be targeted. We are also spending in the welfare area $148 million on better youth services so that they can work with the young unemployed. These people need hope, and they need a future.

Education—there has been a lot said about it in the last few days. It is another winner in Budget 2012, with an extra $512 million. We have continued our firm focus on raising student achievement and teaching excellence. I believe that Hekia Parata is doing an outstanding job. We do have a world-class education system and a very dedicated, talented, and hard-working teaching workforce. There is so much to be proud of. But—and there is a but—not all of our children are succeeding and realising their potential. Something like one in five is not getting the qualifications they need, and we believe that that is not good enough. That needs to change.

Let us look at what has happened in the last 10 years. We have in the public gallery a big group of schoolchildren who are here. I think you will appreciate this more than perhaps the chattering classes on the other side of the Chamber, who—

The ASSISTANT SPEAKER (H V Ross Robertson): Order! The member cannot bring the gallery into the debate. She is addressing the Speaker, and through the Speaker the House.

MAGGIE BARRY: Thank you for that clarification, Mr Speaker. In the National Party we believe that our young people deserve a lot more, and we want all our children to leave school—that is five out of five of them—with the qualifications they need to make a good life for themselves. So we have targeted specifically 85 percent of all 18-year-olds to achieve a minimum of a level 2 National Certificate of Educational Achievement or equal qualification. We are also starting to increase participation in early childhood education. We want a target of 98 percent there in the next 5 years.

Budget 2012, crucially and specifically, invests in improving the quality of our teaching. The biggest change is an explicit trade-off of quantity for quality. We are not ashamed of that, and we are not resiling from it. Part of the way we are funding this is to make a small adjustment to the teacher-student ratio funding in schools from years 2 to 10. These are funding ratios, and we as the Government fund them. As Minister Parata has been at pains to point out on several occasions, it is the schools that set their own class sizes. What is going to be the impact on schools? Let us put aside the scaremongering and the misinformation that is being peddled by the Opposition, and actually address the facts. Ninety percent of our schools, as the Prime Minister said in this very Chamber a couple of hours ago, will either gain or have a net loss of less than one full-time teacher equivalent as a result of the combined effect of the ratio changes and the projected roll growth. Moreover, there will be 10 percent of schools that will have a difference, and there are a few sharp edges on that. We want to look at the people who are catering specifically for technology classes at years 7 to 8, and that is effectively the intermediate schools.

On Monday in my electorate I met with a group of nine school principals from intermediate schools. They told me their concerns. In a 2-hour meeting we discussed their concerns in some detail. I agreed with them that their issues were real ones. We took the message back to caucus, we discussed it robustly, and there were clarifications that emerged from that. The Ministry of Education, along with the Minister, who announced it but who directed the ministry, announced that there is now going to be a guarantee that the staffing entitlement in all schools in New Zealand will not be reduced by more than two full-time teacher equivalents over the next 3 years as a result of the policy changes. There is also going to be a working party that is going to get together, and there is a contingency fund so that that management, that transition to the new ratios, will be achieved.

That is an important issue, as is the issue with seniors. I do not want to digress into a rebuttal of what the Opposition is saying. I want to concentrate on what people really care about. In my area the seniors are worried. They are very worried about the level of services for dementia care. I share those concerns. New Zealanders are going to be getting something like $10 million over the next 4 years for community-based dementia services. This is a very important area. We are also increasing funding for aged residential care beds by $82.4 million over the next 4 years. We understand that New Zealanders want to stay in their homes for as long as is possible, so we are increasing funding to raise an extra $57 million compared with what was spent back in 2008.

The asset test—let us look at it briefly. Labour is complaining that the threshold has been altered. Labour forgets, of course, that when times were good in the early 2000s, it was looking for ways to spend money, so it introduced a flat $10,000 annual increase. We are actually slowing that rate of increase, in recognition of the tight times and the ageing population. We are going to be using the Consumers Price Index to set the threshold, just as we do to increase national superannuation every year. New Zealand superannuation, like the asset testing, will be geared to the Consumers Price Index, and that is a very important point.

I would like to make one last point. I personally would like to celebrate the other measure, which is the encouraging news that we are increasing the funding for environmental schools—Enviroschools—by $7.6 million. It is yet another fine measure. Thank you.

RINO TIRIKATENE (Labour—Te Tai Tonga): Tēnā koe, Mr Speaker. Talofa lava. Kia ora tātou katoa. It is my great pleasure to stand and join in this debate on Budget 2012 with my Labour colleagues in opposition to this atrocious, awful Budget—the zero Budget, the “nothing Budget”, the “kore Budget”. It delivers nothing and we oppose it. It is a failed Budget from this failing Government, and it has delivered zero for New Zealand. We have got zero hope, zero ideas, and zero opportunities flowing from it.

There is a new word that has come out of our Māori whānau around the motu. They have heard about the zero Budget, and the austerity Budget, and the cuts. You say “austerity”, but Māori whānau are now saying “Oz territory”—Oz territory. What we are seeing is our whānau in their droves boarding the planes and heading over to The GC across the Tasman. They are going to Oz territory because of the austerity that this appalling National Government has been imposing in this dreadful Budget.

We have got a lot of poroporoaki going on, up and down the country, from Auckland, Wellington International Airport, and right the way through the country. Every day our whānau are going to the departure lounges, having a tangitangi poroporoaki, and saying goodbye to their loved ones. All of our whānau are affected. Everyone is affected: friends, families, aunties, and uncles—[Interruption]

The ASSISTANT SPEAKER (H V Ross Robertson): Order!

RINO TIRIKATENE: Friends, aunties, and uncles—they are all being tearfully farewelled as they cross the Tasman to a better life. It is appalling that they are forced to make that very, very sad decision to leave our great country, because of the no-hope and failed Budgets of this Government, and the fact that there are no jobs being created out in the regions.

If we look at the actual record of this National Government, we see the worst growth record in 50 years—the worst growth record in 50 years. It is a party that talks about economic growth and free enterprise and business, but we have had the worst growth in 50 years. We have 50,000 of our whānau members up and down the length and breadth of this country—over 50,000—leaving for Australia every year. We have had a 52 percent increase in unemployment, and nearly 50,000 more of our people are on benefits. So this Government has overhyped the talk, but it has failed to deliver.

We do face serious issues as a country—in fact, globally. We acknowledge that. We know that the EU is on the brink. Greece is in serious trouble. Spain is in trouble. The term “bank runs” is a highly searched Google term these days. So there are going to be some serious things happening up in Europe over the next few weeks, depending on the outcome of elections that may be taking place. We know that things are really tough, in terms of what effects that could have on the banking system and the ripple effect that that will have right throughout the whole world. We are not immune to that, obviously. We are well aware of that.

But what is this National Government doing in response, with this Budget 2012? What is the big idea that it has come up with? Well, it is squeezing an extra $14 million from our tamariki—from our paper boys and paper girls. That is the National Government’s big idea to turn our country round, to protect us, to get us on to a sustained growth path so we can actually deal with all the headwinds that we will be facing in terms of what is going on overseas. The Government wants to squeeze. That is the big idea. It wants to squeeze some coins from those paper delivery boys and girls. So we have got the penny-pinching, which is the great idea this Government has come up with.

We have got the attacks on our schools. Now it is attacking our teachers and it wants to cram more kids into the classroom, put more pressure on our schools, and cut out the teacher numbers. What else is the Government going to do? What else are its big ideas? It wants to asset-test out the elderly now, and penny-pinch from our elderly, from our kaumātua, from our kuia.

Oh, and we cannot forget the great plan that it has. We are facing a very tough global economic crisis situation, potentially, and what does the Government want to do in this environment? It wants to sell off four of our major State-owned enterprise assets in such a depressed international market, and it says that mum and dad investors want to buy them. I know what it is like when those State-owned enterprises are up for sale. I know who are rubbing their hands right now, in terms of all of the money that they want to make from the floats of those initial public offerings on those asset sales. It is the corporate lawyers who will be charging in the millions for doing all their transactional work and providing all their advice. It is the corporate advisers, it is the investment banks, and it is the people who will be leading the public offerings who will be making a mighty lot of money from the public offer. It will not be the mums and dads. It will be the advertising agencies that will wheel out, probably, an ex - All Black captain or some other celebrity to front the TV campaigns that they will be beaming across our television screens, telling us how great these investment opportunities are. The mums and dads who will be watching that TV screen already own those assets. They do not have the money, in this depressed environment, to even get in the queue to try to secure some shares.

That is the Government’s great plan. It wants to sell off Air New Zealand, Solid Energy, and our electricity generation companies in the worst of times to try to raise a bit of cash, when what it did in its first 4 years, now, was totally irresponsible, such as implementing tax cuts that benefited only the rich. That was irresponsible and it sucked out desperately needed revenue for our country and put it into the pockets of the wealthiest. The Government increased GST to 15 percent, which disproportionately impacted on everyone, all of the whānau particularly, who struggled to pay for their shopping, to pay the grocery bill, and to pay the bills every week. They are going to the grocery store and struggling to pay the bills. Those are the big ideas.

I could go on about how child poverty has increased in our country. Only today Unicef has come out with its report on measuring child poverty internationally, and New Zealand is ranked in the bottom half of the countries in terms of measuring child poverty. That is a disgrace. That is a national disgrace. But what is this Government doing about it? It wants to just sell off assets and pick the pockets of our paper boys and paper girls.

I want to just touch briefly on what is in this Budget for Māori. I know that the Māori Party members stand up and talk about the fact that we have a bit of money for this and a bit of money for that. But, basically, this is a zero Budget. The money is just getting shuffled around. Some will go up, some will go down, but at the end of the day everything equals out and there is no extra money that is actually going to be going into helping our people. In fact, based on the total policy initiatives that this National Government is persisting with, even though it can see that there are big, big challenges on the horizon, this Budget will actually have no positive benefit for Māori. So this is a non-Budget for Māori.

It is going to be interesting when it comes time for us to vote on this particular bill, and when we do the party vote count as it goes around the House. Of course, the Māori Party is never here. Those seats are always empty when it comes down to this business.

Louise Upston: I raise a point of order, Mr Speaker. It is a well-known tradition that you do not talk about members’ absence from the House.

Hon Trevor Mallard: The member is right, as far as the convention, about individual members. But there is no convention that says that one cannot refer to the absence of an entire party on a regular basis.

The ASSISTANT SPEAKER (H V Ross Robertson): Although I understand where the member is coming from, one can extrapolate, and we all know that every person at one stage or another is absent from the House, for whatever reason. I would ask the member to desist.

Hon Tau Henare: Mr Speaker.

The ASSISTANT SPEAKER (H V Ross Robertson): No, no, the member has not finished yet.

RINO TIRIKATENE: Oh, sorry.

Hon Tau Henare: I raise a point of order, Mr Speaker. The member sat down. I sought the call. I sought the call—

The ASSISTANT SPEAKER (H V Ross Robertson): Order! I have to say the member is perfectly correct, but the member did not understand. He thought his time had expired. He has about 8 seconds left, so I am asking the member to complete his speech.

RINO TIRIKATENE: This is a failed Budget from a failing Government. More of our people are going to go to Oz territory as a result. We need a change, and Labour can deliver that. Kia ora tātou.

Hon TAU HENARE (National): Kia ora to you too, brother. What that was was atrocious. That was appalling. I expected more from Rino Tirakatene. You know why? Because up and down the north there is Hone Harawira, there is Shane Jones, there is Parekura Horomia, and there is Rino Tirakatene, and they all march up and down the streets of their electorates saying that we should not mine. But they are the first ones at the departure lounge waving goodbye to their relations, whom they will not give jobs to in the north, who are going to places like Pilbara in Western Australia, or going to mine in other parts of Australia where they mine.

Every one of those members has relations—brothers, sisters, you name it—who are on the bus to the mines, where they are allowed to mine. Those members get up in this House and they ask where the jobs for our people are. I tell you where the jobs are: in the north and on the East Coast. You know, it is the same people who jump in their four-wheel drives and drive out to a protest against drilling for oil—oil that makes the diesel that they put in their four-wheel drives. There is a word for that sort of person. Yes, there is a word—[Interruption] Well, I was going to say the other word—

The ASSISTANT SPEAKER (H V Ross Robertson): No.

Hon TAU HENARE: I said I was going to say the other word, but the new word is “Labour MP”. Yes, that is that what they are. They will walk up and down the streets of Whangarei—and there is another one; we will get to him in a minute—and they will walk up and down the streets of Moerewa talking to the poor people. All the poor people want is a job. But then those members say: “Good on you. Here is 10 bucks for your kitty to go to Australia to get a job.”—the job they will not allow you to have in New Zealand. That is the atrocious thing about the Labour Party. I can handle it from the Greens, because that is their kaupapa. That is their kaupapa. If they want to do that on “Planet Green”, that is fine. But I expect more from my relations across the way, and I am not talking about Trevor Mallard.

This Budget is about being responsible with New Zealand’s finances. That is what it is all about. It is actually about nothing more than being responsible in hard economic times. If Labour wants us to go down the road of Greece, Spain, Italy, and so on and so on, then that is fine. Go to the election and get elected.

But here is the thing. Last year National went out to the people of this country and put forward a plan. That plan included some things like the 49 percent sale of State assets. The atrocious thing is that we get the opposition from the Labour Party, which introduced not a 49 percent sale of State assets but a 100 percent sale of State assets. I can tell this House, with my hand on my heart, that if, back in those days, we had taken the road that we are taking now—a 49 percent sale and we keep the majority share—things may have been a wee bit different. So I applaud John Key, Steven Joyce, and Cabinet for making that decision and allowing us to go out and campaign for it. What happened during the November election? We put it out there. People voted for us. We are the Government. No amount of getting up on the hind legs is going to sway us from our path.

Todd McClay: He was on his front legs.

Hon TAU HENARE: He was on his front legs—well, that is nice. Our plan is about being responsible. It is about making sure that our finances are in good shape, because who knows what is going to happen tomorrow? Who knows what is going to happen next week in Europe? I tell you what, I hope that China does not go belly up, and I hope that Australia does not go belly up, and all of our trading partners, because we need them as much as they need us.

The young people in this country are getting a raw deal from those members opposite, who will stop them getting the jobs and education that they so deserve. And while I am on education let me mention a 2 percent rise in the roll, and a 12.5 percent rise in the number of teachers. Over the last—how long was it—10 years have we seen a discernible increase in the quality and the results? We have not.

Hon Member: We have.

Hon TAU HENARE: We have not.

Hon Member: Read the NCEA results.

Hon TAU HENARE: No, we have not. Anybody who stands up in this House and says the results are going that way is talking porkies. I did not accuse them of talking porkies, but they will if they do. It is a shocking indictment that Māori are still at the bottom of nearly every indicator. It is a shocking state of affairs.

Hon Trevor Mallard: He used to be Raymond before he was a bottler.

Hon TAU HENARE: We have been here, what, 3½ years—and see the personal attacks by “Mr Quackmaster”—the “Quackmaster”. The personal attacks do not even worry me. Oh, no. I tell you what, that sort of public attack is like water off a duck’s back. It is an indictment that they for 9 years oversaw the crumbling of Māori statistics. They are the ones, and they get up in this House and tell our people that they cannot get jobs in the mining industry in their own areas. But they will wave them goodbye at the departure lounge. That is a horrible indictment on those people across the way.

I hate it when those members get up and say how they feel for the poor old Māori boy who has not got a job up in the north, or the poor old Māori guy who has not got a job down on the East Coast. But if we allowed mining in this country, we could be like the Gold Coast, and we could be like Western Australia. We could be as wealthy and as educated as our mates across the Ditch. It is an indictment that they sit there and blame National for what is happening around the world. I tell you what, some of the members from Christchurch from the Labour Party need their heads read as well. The Christchurch earthquake is something that could have happened to anybody, in good times or bad, and we just have to bite the bullet and fix Christchurch. At least this side is doing the job. We do not talk about it; we get in there and do it. [Interruption] That is right, New Zealand First.

Phil Twyford: That member doesn’t even get up off the couch.

Hon TAU HENARE: Now we hear Mr Twyford, the new MP for Te Atatū. He has already said that he will spend a billion dollars—a billion dollars—on a busway. Mr Twyford has already promised the people of west Auckland a billion-dollar busway. He has been in the electorate only 6 months, and he wants to tax and increase the rates in our area. Not once did Mr Twyford front Len Brown and back the people of west Auckland. He did not. He went around the back and he patted Len Brown on the back and said: “Good on you, Len. Spend all the money. These fellas out in west Auckland don’t give a hoot.” It is a great Budget, and I will tell you what, it is a great day to be a member of the National Party.

EUGENIE SAGE (Green): Talofa lava. Tēnā koe, Mr Speaker. The Government made it very clear that last Thursday’s Budget was a zero Budget. It had zero ambition for making our clean, green image and brand a reality. The Minister of Finance did not even mention the natural environment in his Budget speech. The Budget has zero ambition to safeguard the health of our oceans or to significantly improve the survival chances for kiwi, mohua, whio, and other species at risk of extinction. This is despite the fact that we have a billion-dollar tourism industry, and the Department of Conservation, with its management of national parks and conservation lands, is one of the biggest providers for tourism in New Zealand.

The National Government does not seem to realise that the economy depends upon planet Earth. No environment; no economy. No wild landscapes; no tourists. No water; no milk. This report, Beyond Rio: New Zealand’s Environmental Record Since the Original Earth Summit, should be a wake-up call for Government because it shows how much more we need to invest in environment and conservation, except that this Government, as the last speaker, Tau Henare, demonstrated, has blocked its ears. Its plan for the economy is firmly based around resource extraction: drilling for oil, mining for coal, damming or diverting rivers for irrigation, and encouraging further growth in dairying regardless of the pollution load and the environmental damage and harm that that does. For the members opposite, they do not seem to realise that the climate in New Zealand and the geology in New Zealand are very different from those of Australia. With our higher rainfall, there is much more risk of tailings dams leaking and of toxic chemicals leaking into our waterways; it is completely different from the dryland environments of Australia.

New Zealand was one of the first countries to ratify the Convention on Biological Diversity in 1993. That was followed in 2000 by the adoption of the Biodiversity Strategy, and one of the strategy’s primary objectives is to halt the decline in biodiversity. At the Rio Plus Ten Earth Summit, in Johannesburg in 2002, the Government committed to strengthening national, regional, and international efforts to control invasive alien species, which we know are one of the major causes of biodiversity loss. Our 2004 state of the environment report identified biodiversity loss as our most pervasive environmental issue. We have a global and a national biodiversity crisis, yet this Budget cuts funding for our main biodiversity manager, the Department of Conservation. The department’s allocation of $335 million is equivalent to the budget of the Hamilton City Council, yet the department manages a third of our land area. The Budget means an $11.6 million cut in departmental spending in the current year, and an $8.7 million cut from 2013-14 onwards. It means that in the next year the department has to raid its land acquisition fund of $8.2 million. That means there is no money to purchase coastal forest and other lowland areas that are not well represented in the conservation estate. And it will mean more loss of conservation expertise and skill as departmental staff are forced to leave in the next round of restructuring.

So, despite the evidence of the biodiversity crisis, this Budget offers no hope, no vision, and no indication that the Government wants to achieve the goal in the Biodiversity Strategy of halting the decline in biodiversity. As the Royal Forest and Bird Protection Society has said, it is “galling” when you look at Vote Conservation to see that the department will spend just $156 million on the protection of our wild places and wildlife in these islands of Aotearoa. The Government’s priorities are wrong. It gave tax cuts to the well-off so had $1 billion less to spend elsewhere. It expects to spend $100 million in investment bank fees to sell off our energy companies and get a one-off windfall, yet it refuses to invest even $10 million more in conservation. It subsidises the mining industry to the tune of $24 million for its seismic surveys, yet it cannot properly fund conservation. This is despite the fact that the department has world-leading expertise in conservation. It achieved a world first in eradicating rats from Campbell Island. And as Associate Professor Dianne Brunton of Massey University said in response to the Beyond Rio report, “DOC are very good at controlling predators and pests when [they] have sufficient resources to do so …”. Yet this Budget means that in the next financial year the department will be able to undertake sustained possum control on only 1.2 million hectares of the 8.5 million hectares it manages. It will be able to do sustained weed control on only 1.8 million hectares. A Green Budget would invest in conservation instead of the short-term thinking and the callous cuts to environment and conservation spending, to our native plants and wildlife, that are in this Budget, which sees the department’s funding slashed by $54 million over 4 years.

The Department of Conservation has a statutory responsibility to advocate for conservation beyond the conservation estate, but one of the main consequences of the funding cuts and the associated restructuring and loss of 150 staff—planners, lawyers, ecologists, and others with technical expertise—is that increasingly the department is absent from major resource consent applications. It was not there on the plan change for Crystal Valley, which takes some of the Craigieburn Range and turns it into an alpine village and subdivision. It has not been involved in TrustPower’s application to change the Rākaia water conservation order. The water conservation order exists to protect the outstanding habitat values of the Rākaia catchment for birdlife, yet the Department of Conservation has not been involved. Nor is the department involved in Solid Energy’s application to mine at Mount William, despite the outstanding biodiversity of the coal plateau. So the fact that the Department of Conservation is not involved because of these funding cuts puts the burden on NGOs and the community. It means that there is less information presented to decision makers, and that, of course, tilts the playing field in favour of resource exploitation and environmental harm. And yet the Government plans to tilt the playing field even further with its plans to allow the Minister of Energy and Resources joint decision-making power with the Minister of Conservation when there are applications to mine on conservation land. It will tilt it further with the EEZ legislation, which will make it “eee-zee” to drill for oil offshore.

We certainly live in austere financial times, but the Green Party would make very different choices. A Green Budget would increase conservation funding, because we recognise the intrinsic values of the species that live on our protected lands. We recognise the added value that investment in conservation provides to making our clean, green image real, to assisting the tourism industry, to promoting our quality of life, and to providing for ecosystem services, because it is often these protected uplands that provide the water that irrigators and others use downstream. A Green-led Government would promote a much more strategic approach to energy generation and energy planning—one that emphasised renewables, solar and wind, and the gains from energy efficiency. It would keep our energy companies in public ownership, because sound energy planning demands that.

A much more strategic approach would provide certainty to generators, energy users, and the wider public. It could involve using a national policy statement to provide guidance on where wind turbines go, and it could mean that we would not then have the conflict that we have seen about sites like the Lammermoor Range and like Mount Cass. A more strategic approach would also be more collaborative. It would mobilise the expertise, the skills, and the resources that we have seen spent in classic conflicts between the environment and the economy in the Mōkihinui River. It would ensure that rivers like the Mōkihinui were given proper protection. A Green Budget would be about ensuring that we have a smart economy that protects our natural assets, that shares prosperity fairly, and that ensures we have a good quality of life.

NICKY WAGNER (National—Christchurch Central): Talofa lava, Mr Speaker. I am very pleased to stand today and support the Appropriation (2012/13 Estimates) Bill. I want to support it because I want to celebrate what Budget 2012 has done for Canterbury and the people of Christchurch. As the MP for Christchurch Central I really appreciate the commitment by this Government to the Christchurch rebuild. It is very appropriate, I believe, that the rebuild is one of the Government’s four priorities, and hearing the Prime Minister say that his Government is 100 percent committed to rebuilding a strong and vibrant city is music to our ears.

The Budget commitments of 2011 and 2012 give Christchurch certainty. They give us certainty because they are important for us as the second-largest city in New Zealand, as the gateway to the South Island, as the gateway to our tourist destinations, and as an export centre for our agricultural production. It gives us the certainty that we can, and we will, rebuild. It gives us the certainty that we can rebuild knowing that the Government is standing right beside us and right behind us. It is very interesting to note that the Opposition MPs from Christchurch have spoken about everything in the Budget, but none of them has talked about the fantastic support for Christchurch and Canterbury. Perhaps that is too positive a story.

On top of the $5.5 billion that was specifically allocated for the rebuild in last year’s Budget—and about $2.4 billion has already been spent—Budget 2012 has increased the funding. It increased the funding, particularly for the Canterbury Earthquake Recovery Authority, by $115 million to make sure that it can oversee that reconstruction and to make sure that that money is spent well. The Budget also added another $13 million for the community, for NGOs to lead initiatives to support Cantabrians. There is a debate about what the total cost of damage in Christchurch and Canterbury will be. It is estimated at somewhere between $20 billion and $30 billion. So whatever you think, there is absolutely no doubt that it is the largest, the most complex, and the most difficult project in New Zealand’s history. But we are making real progress. It is our job to fix and to repair the destroyed homes, the damaged businesses, the public buildings, and the infrastructure, and that job is well on the way.

Of course, earthquakes damage land and destroy buildings, and so the most difficult job we have had to start with is to understand the geotechnical processes under the city of Christchurch and Canterbury. It is to look at the zoning for the very worst damaged lands. That has been a particularly difficult time for residents whose land is damaged, trying to figure out where their future lies. There are still nearly 2,000 people on the Port Hills, in the white zone, who do not know what their zoning will be. However, all the zoning on the residential flat land of Christchurch is complete, so everyone, except those in the white zone, is able to think about moving on and think about creating a new future for themselves, and many have. Owners of 7,256 properties with the worst damage are eligible for Crown purchase offers, and to date 6,162 owners have been sent offers. About half those owners have settled, and that has allowed them to move on and to restart. Every day I talk to people who have found new homes, who have moved into new communities, and many of them are very happy. In fact, some of them are ecstatic. We have paid out about $600 million pre-insurance to those red zone residents and expect to do that again in the next few months.

Hon Trevor Mallard: Who’s “we”?

NICKY WAGNER: The Government has spent out.

Hon Trevor Mallard: The insurance companies.

NICKY WAGNER: No, the Government has spent $600 million pre - insurance repayments, and then $600 million will come again in the next few months.

There is lots of work happening in Christchurch. In fact, that has been a silver lining for many families. Engineers, workmen, and tradespeople are everywhere. The Earthquake Commission has repaired over 15,500 homes, and another 35,000 homes are in the process. The Stronger Christchurch Infrastructure Rebuild Team has completed $165 million worth of infrastructure repairs, and it is completing about $40 million worth every month going forward, which will finally end up with about $820 million. Right now it has been working on the pipes and the drains under the city. It has examined, assessed, and cleaned over 1,000 kilometres of pipes, and it has repaired 20 kilometres of them.

Of course, buildings have to come down before we can rebuild, and we are getting very good at demolition in Christchurch. There are about 1,000 buildings in the central city that have to come down. Close to 800 have been demolished, with another 200 on the way. I actually live in the centre of the city. I go to bed hearing the demolition and I wake up in the morning hearing the demolition, but I have to say it is a good feeling to see those broken buildings gone and to realise that we are beginning to rebuild. Things are popping up all over the city. I have got a new house over the road from where I live. My office was a rebuild since September. There are new shopping centres, there is a new supermarket about to open, Briscoes has got a new centre, and there is a new hotel. There are about 26 major buildings being built in Christchurch at the moment.

However, there is no doubt it has been an extremely tough time, both physically and mentally, for the people of Christchurch, so the health and well-being of Cantabrians has been a really important part of the Government’s earthquake response. Extra funding and resources for the Ministry of Health and the Ministry of Social Development made sure that we could have a rapid response going right back to September and right through 2011, and the extra money for health in this Budget will also help. Although the health facilities in Christchurch are working amazingly well, it has been really difficult for everyone. I would like to pay tribute to the doctors and the nurses and the health professionals who are working under very difficult circumstances to keep our system running, and it is still fragile. In fact, I think most of the people in Christchurch are a little bit fragile at the moment, so Budget 2012 has confirmed an excess of $2.8 million for the Canterbury Earthquake Recovery Authority’s community well-being team.

In education we have an opportunity to look at new ways to deliver to our young people, and it is good to see the increase in Vote Education and our commitment to getting a great education to five out of five young New Zealanders. It was an absolute credit to our schools, to our teachers, and to our parents that Christchurch students improved their response in the National Certificate of Educational Achievement last year despite all the disruption of the earthquake. Christchurch’s results were 6 percent higher than the national average and its students did better in 2011 than in 2010. So it just goes to show that when you focus on education, and you have a quality input, you can get a quality output.

One of the silver linings of the earthquake is that young people can see many good jobs ahead of them in the rebuild. We have created 4,500 new training positions in construction, but all types of skilled workers are in demand. We need accountants, we need lawyers and managers, and we need everybody who can support the rebuild and our communities.

The productivity of Christchurch is essential to the long-term economic health of our country, and our future is looking good. Our economy is operating well, record amounts of exports are going through our port, unemployment is down, and many businesses are not only recovering but flourishing. I would like to thank the Government for its support of my city in this Budget, and I believe that Christchurch is looking forward to a very bright future. Thank you.

DENIS O’ROURKE (NZ First): The Government presents the Christchurch earthquakes as both a problem and a solution in the Budget. It is one of the three excuses given for its failure to manage the New Zealand economy adequately, listed along with the global financial crisis and the New Zealand recession from 2008—both of which have been with us, of course, for some years. At the same time the Budget presents the earthquake recovery as a solution generating most of the projected growth that the Government has put in this Budget, and also as the biggest factor in new job creation.

The growth overall has struggled in recent years to reach 1 percent, and this makes, I think, the Government’s projections in this Budget for 3 percent growth in the future years pretty unrealistic. However, according to the Government’s own projections the earthquake recovery will make the major contribution, through residential and infrastructure rebuilds in the coming 3 years, to the growth projected in that Budget. That growth resulting from earthquake recovery does not arise from Government policy; it is consequential growth from disaster recovery, and it is funded more from insurance and investment from the private sector than from Government investment as a result of its two Budgets—the previous one and this one.

The earthquake recovery is stated to be one of the Government’s priorities. But when you look at this Budget, little or nothing more is added by it over and above the allocation made in the previous Budget. The Government measures offer nothing new to Christchurch people suffering the effects of the earthquakes. All we get are statistics on the numbers who accepted the red zone offers, and they are not very revealing in themselves. The fact is that too many people were losers from that process. Too many people cannot, in fact, afford to buy the new sections—those of them that are on offer, and there are far too few of those. Homes are effectively confiscated by the Government under the red zone regime, with inadequate compensation for far too many people. Yes, there have been some winners, but there have been far, far too many losers. People are expected to move on without fair compensation, and that is not the way New Zealanders do things.

I suggested to the Minister for Canterbury Earthquake Recovery concessionary bridging finance as a way of helping people move on: for example, a facility up to $100,000, repayable on the sale of the property or the death of the borrower, with no interest or perhaps, at most, a modest concessionary interest rate. That would have been possible with very modest expense to the Government, and it would have helped a lot of people to move on. There has been no reply to that, no action on that or on any other provision of that kind that would actually make a difference to Christchurch people who are struggling to move out of the red zone and to buy another property. That is just not good enough. This Budget is silent about that.

Another fact is that some insurers are getting away with blue murder: deliberate delays, bullying of claimants, and other problems. We see, again, absolutely no action by this Government whatsoever, and that is not good enough, either.

Another fact is that the Earthquake Commission has been much, much too slow in reinstating damaged land and homes in Christchurch. I believe that the reason for that is the Fletcher’s monopoly. It is a monopoly of inaction. Qualified Christchurch tradespeople are available who are not employed by Fletcher’s, and they are available to assist in the rebuild. They are being shut out by the policies of this Government, and that is poor use of available resources, and contributes further to the very slow progress of reinstatement of damaged houses in Christchurch.

Another fact is that there is a severe housing shortage in Christchurch. It is chronic and it is getting worse. No significant action has been taken by this Government on that, nor on the rent increase explosions. No action has been taken on that, either. People have asked for months for action on that and they get silence from this Government. So if the Christchurch earthquake is such a high priority for this Government, why has there been so little action on these important issues?

I believe that Christchurch people have gone through three stages in their reaction to what has happened since the earthquake. The first one was a reaction of gratefulness that the Government was in there and helping out. And we all felt that. That was fine, and I suppose that it assisted the Government in the election. But since then what has happened is more and more protests—protests on top of protests about problems on top of problems. Now we have got over that to an extent, because people are now just resigned to the situation that nothing better is going to be offered to them, and, of course, that results in a lot of people simply leaving the city or giving up hope. In fact, in a recent survey 68 percent of Christchurch people said that they were unhappy with the Government and the earthquake policy.

So I simply do not understand how Nicky Wagner can get up in this House and tell us all how wonderful it all is in Christchurch, when everybody who lives in the affected areas of that city knows that that is not true, and it should never be projected as such. But there is more. The rebuilding of Christchurch central—and Nicky Wagner, as she says, lives there—needs funding. It needs funding so that the rebuild can happen with insurance money and with Government money, and happen promptly, and basic infrastructure gets attention with a combination of Government money, council money, and insurance money.

But there is not enough money to fund the aspirations of Christchurch people for their city for these three things. First of all, there is the new central city rebuild. There is a good plan that has been produced, and the Christchurch Central Development Unit has been established, and we hope that that will be effective in pursuing that plan. But what funding has been allocated to it? We do not see that in this Budget, and we should. Secondly, in respect of the repair of heritage buildings, which are dear to so many people in Christchurch, there has been nothing but a huge, deafening silence from the Government. There should be a special provision in the Budget for the preservation of heritage buildings in Christchurch, as required by the people who live there. And, thirdly, there needs to be direct support for economic recovery in Christchurch, such as special economic zones to stimulate economic recovery and to ensure that it happens in a structured way.

So what we get from this Government is yet another aspect of its dull, lifeless Budget from “Asteroid National” for Christchurch. There is no provision for those needs that I have spoken of. So much for the Christchurch earthquake recovery commitment from this Government! Many are now saying that the earthquake disaster was one thing, but it has been matched by Government policy as well.

The Minister of Finance, in his Budget speech, said this: “The rebuilding of Christchurch will be a key driver of overall domestic activity and is expected to contribute around one percentage point to annual growth in each calendar year from 2012 to 2016.” So the rebuild will save the New Zealand economy to this very considerable extent, but given the pathetic record of growth under the Government of only about 1 percent in recent times, the Christchurch rebuild will apparently be a very big part—and perhaps all—of that future growth. And none of it is actually this National Government’s doing.

The Government’s reliance on a natural disaster to produce the growth that it claims credit for is not—is not—a credit to it. Growth needs to be achieved well over and above that.

SHANE ARDERN (National—Taranaki - King Country): It is a pleasure to take a call in the debate on the 2012 Budget, which is a forward-looking Budget in times of very challenging economic circumstances. I know that it is lost on our opponents on the other side of the House that there is a major meltdown taking place in Europe as we speak. It has absolutely escaped Labour’s attention that in the US what is being described as a second recession is potentially going to take place. Listening to our opponents on the other side, the rest of the world is flat, and the only place where there is an economic plan is back here in New Zealand, and it is contained within the Labour Party.

Let us have a look at what Labour has been saying. It has been saying that the way to prosperity in New Zealand is to tax the industries that are prosperous, which means the agricultural sector, with a capital gains tax on farming. A capital gains tax; that is the answer! If something is moving too quickly, you tax it. If it keeps moving, you tax it some more. If it stops moving, you subsidise it to get it moving again. That has always been the Labour plan. It has been tried and it has failed around the world. If you look at the excesses of some of the spending in Europe, and look at the type of Government policies there over recent years, you can sheet some of that same philosophy right back here to New Zealand.

Let us have a look at what this Government is doing. It is responsibly managing the Government’s finances, building a more competitive and productive economy, delivering better public services, and, of course, rebuilding Christchurch. The Government has in mind a 3 percent growth rate within a short period of time. This is a very aspirational goal in the circumstances that we find ourselves in. If you look at what our opponents are offering us, this level of growth is certainly a brighter, much more focused direction. Growth in New Zealand over the next 3 years is forecast to be higher than Europe’s rate of 0.5 percent, and the United Kingdom’s of just over 1 percent. So what you are looking at is an economy in New Zealand based on the agricultural sector, which is dependent on exporting in the wider economic climate, and which has a set of rules around it that will deliver those results.

It was interesting to read in the Dominion Post today—not usually somewhere where you would go to find a friend of the agricultural sector—where it said: “Agriculture is the sensible choice to base such a vision on.” The writer was talking about a vision for how to grow the New Zealand economy. KPMG’s latest Agenda magazine said: “Now is the time for the diverse companies that produce New Zealand’s food, fibre and timber products to explore how they can work together—with the government—to make the primary sector New Zealand’s pathway to prosperity.” This comes directly from today’s Dominion Post. I could not agree more, and I congratulate the Dominion Post on having the good sense to pick up on and write something like that, because what do we hear from our Green opponents and our Labour opponents? The way to grow New Zealand, apparently, is to place so many restrictions on our agricultural sector that there is no way that it could grow.

Hon Trevor Mallard: Tell us about DIRA.

SHANE ARDERN: Well, I would love to tell the member about the Dairy Industry Restructuring Act, but, you know, I probably would not be able to give him the intelligence to understand it. I understood that it was duck shooting season, and obviously one or two have escaped the maimai. The reality is that this economy is an agricultural-based economy. It will be interesting to see how that member responds to the dairy industry restructuring legislation over the next few days, because he is going to be given a chance to have a view on that. It will be interesting to hear what the member’s view is.

This economy must grow, and has always grown, through the prosperity of the agricultural sector. What is it that we need to do in times of hard economic circumstances? One of the things we need to do is have a look at what will actually make the economy grow. When we look at what our opponents have done, we ask whether they support further infrastructure and development in our agriculture sector. No. Will they support the bill that the member interjected about, the dairy industry restructuring legislation? Well, we are yet to find out. It would probably be without precedent if they do not support it, because when it comes to issues of such economic importance they always have done. So I look forward to their support there.

They want to put out business by producing a tax system that incentivises a whole lot of non-productive activity and puts a penalty on those businesses that produce. Do they support the 90-day probation period for new employees, for example? No, they do not, and they never have. Do they support any labour-market reforms? No, they do not. Do they support the $1.5 billion put into ultra-fast broadband, which is hugely important to the agricultural sector? Do they understand that when you are an export country, you need to be able to export from the areas where you produce the products, like rural New Zealand? Do they support the $30 million investment in rural broadband? No. Do they support the 3,000 jobs that came in through the Hobbit movies? No.

What do they support? What will they support? Will they support the irrigation proposals in the South Island? No. What will they support? Do they support the $5 billion to $7 billion in the mixed-ownership model, which potentially could be invested in high tech education? No. So what we are hearing from our opponents is a whole lot of hot air. In fact, when you listen to the Green Party members you do really wonder—and I seriously do wonder—whether they could carry out some of their policies if they were ever in a position of power. Would they be mad enough to do it? It is a real test. Would they actually be mad enough to do what they say they would do? Because if they did, they would bring the economy—

Hon Trevor Mallard: I raise a point of order, Mr Speaker. I think there are probably two grounds on which you could rule that comment out of order. One is the blatantly sexist language that has been used. Second is the implication of a lack of courage, which I definitely object to.

The ASSISTANT SPEAKER (Lindsay Tisch): The member cannot say that someone is mad, so he should be careful how he expresses himself.

SHANE ARDERN: I do not intend to challenge your ruling, Mr Speaker, in any way at all. Would Green Party members carry out what they say they will carry out? Would they? Could they? And what would happen to the New Zealand economy if they did? That is a very good question. What would happen to the New Zealand economy? If they were to place the restrictions on agriculture that they say they would place on agriculture, what would happen to the New Zealand economy?

Let us go back and have a look at some of the rhetoric around some of the recent things that have been said. I see Mr Hughes in the House. I notice that he recently found out where Taranaki is. There must be something up there for which he could get his name in the newspaper. He was found to be wanting in terms of his facts over that debate, as well.

What have we heard from the Labour-Green Opposition? We have heard a speech from the new incoming Labour leader, David Shearer. He said that we needed to create an economy similar to Norway. He said we needed to have a Nokia in this country, and we needed to move into the high tech end of the economy.

Hon Trevor Mallard: Norway?

SHANE ARDERN: What I want to say to the member opposite who constantly interjects—

Hon Trevor Mallard: Wrong country. You don’t say Taranaki and Hawke’s Bay are the same things.

SHANE ARDERN: The member constantly interjects, but what does he think Fonterra is, if it is not the New Zealand equivalent of Nokia. What does he think turning milk products into an asthma inhaler substance is, if it is not high tech? What does he think developing very sophisticated nutraceuticals, which help that member ride his bike, is, if not a high tech industry? What does he think developing very sophisticated food products and ingredients is, if not high tech? I know that it is lost on the member. I know we could talk about it for some time, but he would not want to listen to or hear that view.

What is the biggest threat to the New Zealand economy? It is the Labour Party and the Green Party. What is the biggest threat to the environment? It is the continual bashing of agriculture, despite what the agricultural sector is doing to turn that round. If you actually look at where the best opportunity for future development for New Zealand, and further enhancement for the environment, will come from, it will not come from within our cities. I would like the Green Party to apply the same standard to outfalls from cities as it applies to the agricultural sector. When those members go out and start campaigning up and down New Zealand about clean streams, and when they are blaming the dairy industry for pollution, they should at least take a photograph of a dairy cow and not a beef cow standing in the streams. At least that would be a start. That would show they are genuine, at least. But they cannot find a dairy cow standing in a stream.

Hon PAREKURA HOROMIA (Labour—Ikaroa-Rāwhiti): Talofa lava.

E mihi kau ana ki a rātou i roto i te Rōpū Māori, e tautokotia atu te mahi o te Whānau Ora, te mahi o te kāmura, mīhini me ngā cadetships. E tautokotia atu tērā engari, he itiiti atu te nui o ngā take e pā ana ki te pai o tātou a ngāi Māori.

[I really acknowledge those in the Māori Party and endorse the work of Whānau Ora, and carpentry, engineering, and cadetship initiatives. But in terms of how well off we Māori are as a whole, there is really very little there.]

I just want to recognise a couple of the decent things that have happened in the Budget, but overall for Māori and, most of all, for all New Zealanders, this is a shocking Budget. The member Shane Ardern, who has just sat down, talked about madness. Madness is infused in one person’s progress through a jumbled mind, and that is what has happened to a whole lot of the people in this country because he drove Myrtle up the parliamentary steps. He believed that that would be the correction for the economic panacea that he has huffed and puffed about, but it made no common sense, whatsoever.

Over the last four Budgets a fascinating thing has happened pre-Budget. There have been these great statements, statements of grandiose, promising everything—milk and honey. You see, there has been a lot of fibbing in this. That member said that lycra is made out of milk. That is a whole lot of rubbish.

Shane Ardern: I never said lycra is made out of milk.

Hon PAREKURA HOROMIA: So he did not even know what he was saying.

In the first Budget from National, this is what the Prime Minister said: “I think by the end of 2009”—blah-blah-blah—“we’ll … come out of [recession] and I think actually starting to come out of it reasonably aggressively”. In the next Budget he said the Government would “start making the long-term changes that National promised … and needed to lift New Zealand’s long-term economic performance”. In the next one he said: “This Budget is about growth. It is not about looking back, and there will be jobs developed and you will see that grow in the economy.” In 2011 he said: “The Budget is likely to see very strong growth in real wages … very strong job growth”—blah-blah-blah—and this year we had a zero Budget. So growth has been on the Government’s mind.

Mr Speaker, you and I worked together in entrepreneurship and all of that stuff in the past, and it was wonderful. We were innovators of the modern time. I certainly recall those things like starting the Art Deco event, the World of Wearable Arts, and all of that stuff that has become so fashionable now that people make out it is some corporate plan. This Budget is all of that. It mirrors the corporate plans that finance bluffers—people who bluff in the finance world—use. We certainly know what happened to that big company—what was its name?

Hon Trevor Mallard: Merrill Lynch.

Hon PAREKURA HOROMIA: Oh, Merrill Lynch. We know what happened to that.

Hon Trevor Mallard: The Bank of America had to buy it up.

Hon PAREKURA HOROMIA: The Bank of America. This Government has the worst growth record in the last 50 years—the worst growth record. We have 1,000 New Zealanders going to Australia every week, like my great colleague Rino Tirikatene said. That is a disgrace. Why would they want to go over there? And I will tell you what—

Shane Ardern: How Labour would keep them in New Zealand? Tell us how Labour would keep them here.

Hon PAREKURA HOROMIA: We kept them here in the 9 years we were in Government. We had the lowest unemployment rate for 32 years. People going into employment were four times better off then than they are now, and that National Government has added 52 percent to the unemployment number. For every two who were unemployed when it came into power, it put another one on to the number. That is where the growth is. The growth is all negative indices. That is where the growth is, and National makes all these excuses, huffing and puffing about everything else. Of the fact that there are nearly 35,000 kids living in poverty, you should be ashamed. It is shameful. It really is shameful.

Then the member dared to mention the labour market. I will tell you what is driving the labour market at the moment. It about sitting down and listening to families in Wairoa, where the parents say they are having only one meal so their kids can eat. What a shameful thing for any Government to enact on people. It is because of National’s labour market nuances and its crazy ideology, which is about kicking the workers out, making them suffer, and putting the minimum wage up by 50c—

Nicky Wagner: You know better than that.

Hon PAREKURA HOROMIA: —no, no, no, Nicky—then the tax has increased, so the minimum wage has gone up by 20c. Mr Tremain can snigger, because he is on “cosy seat”. He knows that in Wairoa, where he used to turn up with me, they were unemployed and those members have done nothing. He is sitting there doing nothing, and we put them into the jobs. Well, I will tell the Government what happens in the labour market. You invented the 90-day bill. You invented the 90-day bill, and it is very interesting how you have calculated—

The ASSISTANT SPEAKER (Lindsay Tisch): Order! Do not bring me into the debate.

Hon PAREKURA HOROMIA: That lot over there, Mr Speaker, which I am sorry you are part of because they work with you, invented the 90-day bill. This is what the 90-day bill does. It shortens work opportunities, it becomes an added single figure on the labour force numbers and percentages, and the Government makes believe it has invented all these jobs. It has invented so many jobs that it is saying that the number went up by 9,000—that 9,000 dropped off the unemployment. But what it has not added to that number is the 18,000 people who came into the labour market. So it invented the 90-day bill, the poor old meatworkers get stung, and then there is the big game of the nasty companies—

Shane Ardern: Where are there meatworkers in this country being stung?

Hon PAREKURA HOROMIA: —that that joker defends over there. There are some good companies, but the nasty ones are trying to corral everybody into a 3-month employment package. That is low-down cunning. That is low-down dishonesty.

Talking about this international economic downturn, the Government knows every reason why it is happening wrong in Alaska or over in Norway, or anywhere else, but it will not fess up to what it is doing here. There are some very interesting things that Mr Ardern, who is a farmer, talked about. He talked about the commodity export prices. This is what is happening. On average around the world the dip in the percentages is 4.5 percent in the sense of moving towards negative pricing. This country is consistently down at 13 percent. How can you explain that when we are getting the best prices we have ever got for cattle, sheep, beef, and crops? We are failing miserably. That means that those members are not running the books straight enough and they are not getting enough innovation to make things move.

We have heard all this business about the rheumatic fever. The reason you get rheumatic fever and you start heading towards having a Third World country ideology is where you put the families. That is why the Government has slammed the money in for rheumatic fever. Its members should hang their heads in shame for the last 4 years of letting rheumatic fever grow in this country. It is happening in the families where there are poor kids and in the families who are on benefits, and those members think it is really great.

As for the Families Commission, you know, Mr Speaker, this slashing and burning is not good, and I find it hard to believe that you are part of it.

The ASSISTANT SPEAKER (Lindsay Tisch): Uh-uh.

Hon PAREKURA HOROMIA: Sorry. Well, anyway, the Families Commission. The Government has cut seven commissioners off and left one, and it has knocked its budget out—nearly 90 percent worth. That is how much it cares about families—that is how much it cares about families.

Hon Nathan Guy: How long has he been here?

Hon PAREKURA HOROMIA: You think about the shearers and the rousies, though, mister, and make sure that they get helped out, because you ain’t doing it. It really is a disgrace.

As for KiwiRail, the Government is putting more money into that road north of Auckland. Everything is about that damned road up there near Ōmaha, or Ōmahu, or whatever you call it. I wonder who has got their holiday baches there. Never mind the Gisborne to Napier railway line. The Government wants to close down the KiwiRail thing, and stop it from stopping at 12 small towns—going to be a lot of exiting over there. Why do those members want to do that? It is because they are out of control. They think they have unbridled power, and they certainly are not giving the people a fair go.

You know, with the research and development thing that they are huffing and puffing about, when they came in they removed the total tax credits. They removed the research and development tax credits, and the money that they have injected back in they are saying is a huge amount, but it is still only 32 percent of what they took away. You know, it is like the great magician: give with this hand; take away with the other. I see you frowning, Mr Speaker, and I will sit down on that note. Thank you very much.

Dr JACKIE BLUE (National): Talofa lava, Mr Speaker. It is a pleasure to speak in the Budget debate this afternoon. Budget 2012 was a Budget for our times, our uncertain times, and the Minister of Finance, Bill English, has made sure that we will be on track to surplus by 2014-15. That has been the theme for the last 4 years. It has been a sustainable Budget, and it is one that ensures we can actually make our way in the world. We have to pay our debts, and we have to make every dollar count, and this is a Budget that will do exactly that, so I say congratulations to our Minister of Finance.

Obviously, having been a health practitioner, I focused on the health part of the Budget, and I am delighted about Budget 2012 in respect of the health budget. It has been a challenging time for the health Minister, but he has managed to put more money into certain areas, and this made me reflect on how far we have come. In the lead up to the 2008 election the mantra going in was that it was harder to see a hospital specialist; in fact, we had tens of thousands of people culled from waiting lists. The emergency departments were gridlocked. We had stories of patients on gurneys in the corridors of emergency departments and under bright lights. We had workforce shortages, morale was extraordinarily low in the health workforce, we had ballooning health administration, and health professionals were basically seen as part of the problem, not the solution.

Well, our health Minister, Tony Ryall, has carefully managed his way through that with careful leadership through successive Budgets, and he has turned that round. He has got to be congratulated on the work he has done in the health sector. I am certainly proud of our successes in the health sector.

Basically, key to all of this, and to turning it round, is making clinicians part of the decision making. That has been quite crucial, also, in implementing health targets. The targets have been advertised quarterly; they are a way for district health boards and the public to benchmark their local hospitals. This has been welcomed by clinicians. It has not been seen as a threatening move. Basically, district health boards have stepped up. Even this morning at the Health Committee hearing the Waitematā District Health Board, which had had a bad patch only a few years ago and had gone through a rough time, reported that it was leading in most of those six targets for the district health boards. So congratulations to the Waitematā District Health Board. I think that Lester Levy has been an inspired choice as chair of both the Auckland and Waitematā district health boards.

I want to look at some specifics in the health budget. Basically, at over $14 billion, it is the biggest investment so far in health. There is $68 million for more operations, scans, and tests, and that will also ensure we maintain our excellent levels of elective surgery. Compared with 2008, 27,000 more elective operations are performed per year, more than 500 extra operations per week, and under this Budget we are still going to be investing $48 million in elective surgery so that we can have a further increase of 4,000 operations in elective surgery. That is an astonishing, astonishing result and target. In my first term of Parliament, as I said, we had patients being culled from waiting lists. Tens of thousands went back to their general practitioners, from the waiting lists, and I recall many harrowing letters from patients and families about their relatives being culled off the lists—unacceptable. I am so delighted that we have increased elective surgery and will continue to do so.

Also, an area of quite some importance is diagnostic tests, such as magnetic resonance imaging scans, CT scans, colonoscopies, and angiograms. These are important tools in the diagnosis of disease and also in how we plan treatment. Minister Ryall has recognised that we need to speed up timely access to these important tests and tools. Therefore, $16 million has been allocated for new IT systems, which will create faster access to those tests. There will be $4 million for a national register for patients who have heart conditions.

Importantly for me, given where I used to work in the health sector, $33 million has been invested in better, faster services for cancer patients. Importantly, and it has been alluded to by a previous speaker, there has been more money to go to dedicated nurses, to help patients and their families navigate their way through the health sector when they are diagnosed with a serious cancer diagnosis. You can appreciate that with a cancer diagnosis that is very serious, it is confusing, it is frightening, and a navigator—a personalised service using a dedicated nurse—is a fantastic initiative. Also from July we are going to be able to collect key data on those points in that patient’s journey, so that we can get a picture of a patient’s journey, and it will also help when looking at coordinating services and improving services.

I can only go back to 2007-08, when cancer waiting times were absolutely appalling. We had radiation waiting times, and instead of what we have now as the gold standard of 4 weeks, it was up to 16 weeks - plus, which was dangerous. We had women going to Australia for radiotherapy, having to leave their families and their jobs, and their whole lives were being absolutely turned upside down. We will soon be having targets on chemotherapy waiting times, and I am pleased to see that.

The whole thing, I think, with health targets is that they do actually focus the mind and get people talking about how we can achieve that target, and that is key to it all. I mean, emergency department waiting times have been a fantastic success. Emergency departments do represent the barometer of how a hospital is functioning. If there is gridlock, it represents systemic issues going on within that district health board, such as poor patient discharge planning, maybe poor design of the accident and emergency department, and just general patient flows. The fact that 50 percent of our district health boards are now achieving the target of 95 percent of patients being processed within 6 hours is fantastic. You just cannot achieve that out of thin air. It takes planning, it takes collaboration, and it takes communication.

I recall that in the last term of Parliament I went to the Counties Manukau District Health Board when it was celebrating achieving that emergency department target of 95 percent. It had taken 2 years to get to that point. It did not happen overnight. There were conversations about everyone’s role, from the orderly to the personnel and so forth, and that is what—

Hon Trevor Mallard: OK, that’s enough.

Dr JACKIE BLUE: But, no, actually it is quite key. It is actually the care pathways that are key. The Canterbury District Health Board, which is a hugely innovative district health board, is doing care pathways. Basically, it is getting people round a table and talking about what their roles are, and how a disease or process needs to be managed. It is as simple as that. Communication is key, and that was lacking before Tony Ryall took over his portfolio in health. It was lacking, the morale was absolutely down low, and clinicians were not feeling empowered. I tell you: to turn that round is all about communication. It is as simple as that, and this Minister has done it.

Immunisation is a hugely successful target—95 percent of 2-year-olds to be immunised. Well, we have almost achieved that. We currently have 92 percent coverage, compared with back in 2007 when only 67 percent of 2-year-olds were immunised on time. That was a shocking statistic, and we have done extraordinarily well. There is no doubt that health targets focus the mind, and it is all about communication and achieving those targets.

Getting smokers to quit is another target. I am really pleased with the Budget announcement of increasing the tobacco excise, as that will mean we will have more and more people giving up tobacco and cigarettes, in droves. We know that costing hikes make a difference in people not wanting to smoke in the first place, or in people just making that decision to stop smoking. We know that it is an addiction, so access to smoking cessation products and Quitline are so important. I see that the initiative in Budget 2012, with the increase in tobacco excise, along with the health target, will make sure that that statistic keeps improving, and we will, and I am sure we can, be smoke-free by 2025. All of this is quite achievable. Smoking causes so much harm in our society, and I am delighted to see that initiative. I commend this Budget. Thank you.

Hon MARYAN STREET (Labour): We have heard a lot in this Budget debate about the lack of vision in this Budget. I agree with that entirely. It is a zero Budget delivering zero hope, zero vision, zero excitement, and zero initiative for anybody to advance their business and make sure they are keeping up with developments in their industries, promoting and developing new products, and getting our exports to market. The lack of those things is apparent and has been covered by my colleagues contributing to this debate already. But I want to talk about the lack of truth in the Budget. I want to talk about the lack of whole truth in the Budget, and I particularly want to talk about health. We hear repeatedly from the “Sunshine Minister”, Tony Ryall, about the wonderful work that is being done in the health portfolio. I want just to elaborate on some of the implications for the health portfolio that are apparent in the Budget—or are apparent when you look closely, because the thing that is missing in the figures in the health budget is the whole truth. Of course, the Minister could add one more dollar to the health vote and put his hand on his heart and say: “Never in the lifetime of any human being has more money been paid into the health budget.”

Hon Trevor Mallard: He wouldn’t do that, though, would he?

Hon MARYAN STREET: He has been doing that, on repeated occasions—“Never has there been such money invested in the health portfolio.” He could put one dollar in and that would be true, but it is not the whole truth. I want to focus particularly on some of the implications for district health boards, because the Minister says an extra $350 million has gone into the district health boards. Well, I would like to put that in context. Although it might be true—and I am not absolutely persuaded yet that $350 million of new money has gone into the district health boards—I want to talk about the things that the Minister is not talking about that he is requiring the district health boards to absorb this time around. It does not matter how much he says is being given to the district health boards; what he is failing to tell the public is how much they are being required to absorb out of their new reprioritised and existing baseline funding.

For example, look at the obligations that the district health boards now have to take up—the KiwiSaver payments previously paid by the Government out of central Crown accounts. The Minister gave district health boards notice a while ago that it would be their obligation to pick up these KiwiSaver employer contributions, and that the Government was not having a bar of it any longer. This has been notified to the district health boards, and, because it has been notified, the Minister, of course, does not feel any obligation to point out the whole truth of the Budget. For example, let us have a look at the funding increase to Auckland District Health Board, which has been $30.5 million. That is the funding increase above its baseline, apparently. Its liability for KiwiSaver in the next year, 2012-13, is, by its own calculation, $4.8 million. So, already, 16 percent of the new money is to go on to a liability that the Minister is not talking about.

It gets worse. If we get to Canterbury District Health Board, its KiwiSaver liability is $8.6 million. It has been given $20.5 million of additional funding. Forty-two percent, then, of its funding increase will have to go on the KiwiSaver contribution—42 percent. Here is the Minister saying that more money is being given to the district health boards than ever before, that it is going to go on these services, and that money is being transferred to provide all sorts of costs, but nearly half of that new money at Canterbury District Health Board is going on KiwiSaver alone.

Worse than that, if we have a look at the increase of funding to each of the district health boards, we see that the percentage increase across all of the district health boards ranges from a low of 1.33 percent at West Coast District Health Board, to a high of 4.5 percent at Counties Manukau District Health Board. The 1.33 percent funding increase at West Coast District Health Board, I suggest, not only does not keep up with ordinary cost of living adjustments and predictable cost increases but also is going backwards. The district health boards are not better off for this funding. If we have a look at the high one, there is a 4.5 percent increase in funding to Counties Manukau District Health Board—one of our largest district health boards. Again, even at 4.5 percent it is unlikely to cover predictable cost increases. This is meant to cover the increase in the nurses’ collective agreement. Their collective agreement was modest by any negotiating standards. They negotiated a collective agreement that ran across 41 months, effectively, because they gave up 5 months’ worth of back-pay. In the first year it is 2.5 percent, in the second year it is 2 percent, and in the third year it is 1 percent. These are not extravagant numbers, yet there is not enough in these percentage increases across the district health boards for them to meet current liabilities, let alone do the new things that the Minister is requiring of them.

So what does this mean? It means that the district health boards are going to have to cut services. They are going to have to cut services, and where will they cut? Well, they will not be allowed to cut in the hospitals, because that, for the Minister, is too politically sensitive and too obvious, so money has to go into funding more elective surgical procedures. For the cost of more elective surgical procedures, the district health boards, if they are to manage these additional liabilities, are going to have to cut services elsewhere. And where will they cut them? They will cut them in the community. They will cut the delivery of services in the primary sector, because those services on the ground and in the communities go to the little people who do not squawk loudly. They go to the little people in little bunches of money to provide really essential primary intervention in the communities where there is the best return for the health dollar, quite frankly. Those services will go, and there will not be the kinds of squawks and loud noises that there would be if there were to be cuts in the secondary sector in hospitals.

So there are two levels of damage that are happening here. There are two levels of damage. First of all, in not telling the whole truth the Minister of Health is disguising the amount of the benefit to district health boards from the funding increases. In fact, my figures would suggest that there is not $350 million worth of new money, but in fact $276 million worth of funding increase—let us not call it new money, because much of it is reprioritised; stolen from elsewhere—going into the district health boards. The second layer of subterfuge is just where the cuts are going to land. They are going to land in the community, they are going to land in the primary sector, and ironically they are going to land in the area where there is the best cost-effective return for the health dollar. This is less than the truth from the Minister.

BARBARA STEWART (Whip—NZ First): I seek the leave of the House for members taking part in the delegation to Samoa to commemorate the 50th anniversary of Samoan independence to be regarded as present for the purposes of party votes, in accordance with Standing Order 140(1)(c).

The ASSISTANT SPEAKER (Lindsay Tisch): Just a clarification: this is so long as the delegation is overseas? This is for today and tomorrow?

BARBARA STEWART: Yes.

The ASSISTANT SPEAKER (Lindsay Tisch): Leave is sought for that purpose. Is there any objection? There is no objection.

Dr CAM CALDER (National): It is a great pleasure to rise and make a contribution on the Appropriation (2012/13 Estimates) Bill. I would like to make just a small comment. My esteemed colleague Maryan Street was concerned about the health budget. I have to say that I was hugely impressed with the financial reviews that we looked at—the Canterbury District Health Board and the West Coast District Health Board and also, more recently, the Waitematā District Health Board and the Auckland District Health Board. I heard about some excellent work being done by those district health boards. In particular, I want to commend the Waitematā District Health Board, which has actually turned round a very, very difficult situation. It is now the nationwide leader in emergency department waiting-times, cancer treatment waiting-times, anti-smoking initiatives, elective surgery, immunisation, and programmes to assess cardiovascular and diabetes risks. So there is a lot of good news in the health budget. There is a lot of good news in this Budget.

I am proud to be a member of the Government that has presented this Budget. This is a strong Budget. It has been called a simple Budget, but it is a strong Budget, it is a disciplined Budget, and it is a prudent Budget. This Budget reassures all New Zealanders that this National-led Government is a safe pair of hands. This Government assures the international credit agencies that New Zealand is governed by a team that realises that ever-increasing debt is unsustainable. The financial markets are intolerant of poor fiscal policy, and any hint of profligacy would lead to higher interest rates and increased debt-servicing costs. It is pertinent to note that we on this side of the House have suffered a litany of opposition to any cuts that we have proposed, such as targeted cuts in Government spending and retargeting in other areas where there can be more efficient use of the money. Any scheme to grow our economy has equally been stridently opposed by the Opposition.

This is a responsible Government that is investing in New Zealand’s future. If we want to see an example of a lack of fiscal discipline, we need only look at Europe. Weeks after an election there, weeks after the first election led to no result and questions about Greece’s commitment to the eurozone fiscal compact, these questions remain unresolved. The European Union and the European Central Bank, as well as the IMF, are holding their breath to see whether common sense, rationality, and a commitment to the eurozone will be affirmed at the next round of elections in Greece. As David Cameron observed on the deepening eurozone crisis, either Europe has a committed, stable, successful eurozone with an effective firewall, well-capitalised and regulated banks, a system of fiscal burden-sharing, and supportive monetary policy across the eurozone or we are in uncharted territory, which carries huge risks for everybody.

This Government’s responsible Budget means we are on track to return to surplus by 2014-15. It thereby reduces our exposure to the capital markets and helps us to be insulated from the ongoing European turmoil and global uncertainty. This is a Budget that invests in New Zealand’s future. This is a Budget that is looking to New Zealand’s future. We have, in this Budget, $4.4 billion of new initiatives. These initiatives will stimulate jobs, deliver better services for families, invest heavily in science and innovation, and make our economy more productive and competitive. We have said—we have nailed our colours to the mast—we want to derive 40 percent of our GDP from export markets, and this Budget will help us do that. It will also give New Zealanders the security they require in health and education, whilst also allowing them to live in a state of security.

The priorities in this Budget are simple. The priorities of this Government are simple. There are four of them: responsibly managing the Government’s finances—and we have talked about that a little bit already—building a more productive economy, delivering better public services, and rebuilding Christchurch. We have made much—much—of the fact that this Budget, and our prudent financial management, means we are on track to return to surplus by 2014-15. The Budget surplus forecast is not a huge surplus, but it is a huge turn-round. It means that for the first time in a number of years the Government will be raising enough revenue to meet its commitments without having to increase debt. I will say that again because it seems to be something of anathema to the Opposition. The Government will be raising enough revenue to meet its commitments without having to increase debt. From that time on, we can get our existing stock of debt down, and further reduce our exposure to the ongoing turmoil in the global financial system. It is exposure that when you hear some of the contributions from the Opposition benches you would believe had never occurred. The global financial crisis—what is that? The eurozone problems—what are they? The earthquakes in Christchurch—merely a small diversion, if you believe some of the Opposition contributions.

Given the impact of the 2008 recession, which we accept, and acknowledging the ongoing global financial uncertainty, which we on this side of the House understand is a problem, and the Canterbury earthquakes, our getting back to surplus by 2014-15 will be an astounding result. New Zealanders have appreciated our management of the economy in our first term in Government. They can see and understand that our responsible fiscal management—in particular, our discipline around spending and capital management—is essential to strengthen our country’s resilience in these continuing times of uncertainty.

As I mentioned before, this Budget is crucial to maintaining New Zealand’s international credibility for economic management—a status that, like a reputation, is hard won and easily lost, as many countries around the world can attest. We are a small country. Our economy is dwarfed by that of some large corporations. We are only 0.25 percent of the world’s economy, so, financially, you can look at us like a small coracle bobbing up and down in the Caspian Sea. However, despite our small size, if we do it right and we do it well, such is the state of global financial—

The ASSISTANT SPEAKER (Lindsay Tisch): I am sorry to interrupt the honourable member, but the time has come for me to leave the Chair.

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

Dr CAM CALDER: Malo lava le soifua, Mr Speaker. Despite our small size, if we do it right—

Hon Hekia Parata: I raise a point of order, Mr Speaker. I seek leave to make a personal explanation.

Mr DEPUTY SPEAKER: I would prefer if the member did it in 2 minutes, after this speech, rather than interrupt the member’s speech. Can the member wait that long? Thank you. I will hear the member, then I will take the point of order, if you do not mind.

Dr CAM CALDER: Despite our small size, if we do it right and we do it well, such is the state of global financial mayhem that we will distinguish ourselves from the herd—and we already are. Growth in New Zealand over the next 3 years is forecast to be higher than in Europe, the UK, Japan, the US, and Canada. We are expected to have a similar growth rate to our nearest neighbour and greatest trading partner, Australia. Our growth in New Zealand is based on strong fundamentals, and we are producing the sorts of products and types of services that will be increasing demand across the world over the coming decades. Fortuitously, we are now ideally placed so that 60 percent of our exports now go to Australia and East and South-east Asia, which are some of the most vibrant and thriving nations in the world.

This Budget provides a sound economic base upon which to go forward. In this Budget we are investing in research and innovation to help our exporters stay ahead of the competition. Over the next 4 years we will invest $166 million in the Advanced Technology Institute, helping high tech firms improve their productivity. There is $60 million for the National Science Challenges, solving fundamental issues that New Zealand faces. There is $100 million for increasing performance-based research. There is $59 million for more science and engineering tertiary courses. I commend this fundamentally sound, disciplined Budget.

Debate interrupted.

Amended Answers to Oral Questions

Question No. 10 to Minister

Hon HEKIA PARATA (Minister of Education): I seek leave to make a personal explanation.

Mr DEPUTY SPEAKER: Leave is sought for that purpose. Is there anyone opposed to that course of action? There appears not. Leave is granted.

Hon HEKIA PARATA: I would like to clarify an answer I gave to oral question No. 10 today. I was asked whether I had received a list, and I replied no. My office did receive a list of schools affected by ratio changes as well as forecast roll growth. However, this list was based on a different funding formula. Thank you.

Budget Debate

Bills

Appropriation (2012/13 Estimates) Bill

Debate resumed on the .

DAVID CLENDON (Green): I am pleased to take the opportunity to speak to this Budget debate. One of the values of a Budget is, of course, to give us a useful and a very clear insight into the intentions and priorities of the Government in this coming year. In a sense, it is an operational plan; it is an annual plan. Generally, such a document would be underpinned by some longer-term vision—a well-articulated strategy—to achieve that vision. Sadly, as other speakers have commented, that does seem to be what is missing in the context of this year’s Budget statement. Nowhere is that longer view in evidence and we are left with what is very much a business-as-usual approach, at a time when what we critically want and need is some leadership, some change management, and some re-visioning of what this country is and what it could be.

Partly, perhaps in an attempt to disguise the very superficial nature of this Budget, we saw in a week or so leading up to its release some pre-Budget announcements made in a number of policy areas. One of those earlier announcements, I have to say, did give us just a wee glimmer of hope that in one area, at least, this Government is starting to listen to reason and it is actually starting to think about seeking and implementing solutions to very real and urgent social problems, rather than simply continuing to be a slave to populism and to engaging in a race to the bottom in what has proven to be a failed strategy around the so-called being tough on crime.

In a week or so before the Budget, the corrections Minister and her associate Minister announced that $65 million of operating expenditure over 4 years would be prioritised in a way, we are told, that will reduce reoffending, reduce the prison muster, provide more rehabilitation and reintegration services, and improve access to drug and alcohol addiction treatment. Minister Tolley told us: “It’s time to get serious about breaking this vicious cycle of prison and reoffending, … Offenders need to be made accountable for their crimes. But while they are in prison and upon their release, we must do more to rehabilitate, and then reintegrate, if they are to avoid a return to crime.”

I would entirely agree with the Minister that some action is long overdue, in fact. We have for years been going backwards in terms of corrections and in terms of imprisonment. The social and human cost has been enormous, to say nothing of the economic cost, as we have seen an obsession with this so-called tough on crime approach, based on an unfounded and unproven assumption that New Zealanders actually want a punitive approach taken to crime, rather than one focused on real solutions and improving public safety.

The Minister went on to say: “We know that two-thirds of prisoners have addiction problems, and that up to 90 percent can’t read or write well. By seriously addressing these major contributors to crime, alongside increased employment opportunities, we can reduce the likelihood of reoffending.” I must say I am encouraged by the Minister’s use of the word “we”. It recognises this is a community problem. It will be solved only by a consensus approach—in this context, a cross-party approach—to doing a great deal better in terms of managing crime and punishment.

The Minister, as well as mentioning addiction, illiteracy, and others, might well have included other factors that we know are typical and that research tells us have landed too many people in prison over the years. Things like mental illness, a history of abuse, incidence of head injuries, or being hearing impaired are all highly characteristic of the population of our prisons. It is only by addressing these causative factors that we can hope to dramatically reduce our prison population and break this downward spiral of offending, reoffending, imprisonment, and more reoffending.

It is refreshing, I must say, to hear from a Minister who at least indicates that she has been listening to some of those whose proposed solutions are based on solid evidence and a respect for human rights and basic humanity, rather than a knee-jerk populist response, of which we have seen far too much in recent years. Although I do applaud the Minister and the associate Minister indeed on their indication of at least a hint of a new direction, it is clear from an analysis of the numbers in this Budget that there is some work yet to be done in persuading her colleagues to make the real structural changes that will deliver better social and economic outcomes.

A decade ago Vote Corrections sat at around $450 million—if my memory serves, about $437 million, in fact. This year we have seen an appropriation in excess of $1.1 billion. We have had an increase. Failed policies have given us an increase over that 10 years of some 250 percent. That is a massive, wholly unsustainable increase, particularly when most of it has been so poorly targeted and so poorly applied. It has produced very little positive good and a great deal of measurable social and economic harm. This was very well articulated by our current finance Minister, of course, when he very accurately described prisons as moral and fiscal failures.

It is useful to look at the breakdown of how Vote Corrections is to be spent in the coming year. Of the total of close to $1.2 billion, about 64 percent of that—some $760 million - odd—is committed to custodial services, which is basically keeping people locked away, reflecting the per inmate cost of some $93,000 per year simply to keep people contained inside these places. About 18 percent of the vote, some $210 million - odd, will be committed to managing community-based sentences. The grand sum of $151 million, slightly less than 13 percent of the total, will be devoted to the full range of rehabilitation and reintegration services. These percentages are not dissimilar to previous years’ allocations. Indeed, the expenditure in total on rehabilitation and reintegration is very, very close to what was actually spent last year. That, in a sense, represents the essential dilemma that has arisen from years of false assumptions, populist policies, bad lawmaking, and a very ill-considered distribution of resources.

The challenge now is to put in place a programme of justice reinvestment. Justice reinvestment, a phrase that we have, I guess, adopted from overseas, essentially talks about moving money away from spending on keeping more people in prison for longer. It moves away from throwing very scarce money at more concrete, more steel, more wire, and instead talks about spending that money more wisely on actually treating causes of crime and the reasons why we have so many of our people in prisons.

If we go down this path of reinvestment, of investing rather than wasting money and wasting human potential, I believe we will see a very positive multiplier effect. For a very long time we have seen a great deal of noise from a vocal minority suggesting that New Zealanders want more punitive approaches. We know, in fact, that there is a massive resource of volunteers and community organisations that can turn the corrections dollar, multiply that dollar, by contributing their time and their support to released prisoners. There is a major benefit to be won there by appealing to that more silent majority, shall we say, who will give a positive and an active contribution.

Of major concern, I have to say, is the capital expenditure line. There is an indication to spend some $222 million of capital expenditure, an increase of almost $100 million over last year, and the only obvious explanation for that is the project planned at Wiri, the construction of a 1,000-plus bed prison. Dr Sharples, the Associate Minister, was quoted as saying: “With the prison population beginning to fall, we can change our approach to Corrections and focus our investments more on those in custody and less on property.”, and I do hope that with that comment, Dr Sharples was indicating, signalling, a move away from spending on these incredibly expensive and wasteful prison construction projects and putting that money into dealing with the human causes and with the solution to the human suffering that is occurring every day in our prisons.

There are a number of justifications as to why we ought to go ahead with that project. None of them stand up to the light of day. We look forward to a time when we will spend this money well and wisely, rather than throwing it into failed policies. Thank you.

Hon ANNE TOLLEY (Deputy Leader of the House): I move, That the debate be now adjourned.

Motion agreed to.

New Zealand Public Health and Disability Amendment Bill

Mental Health Commission Amendment Bill

Charities Amendment Bill (No 2)

Third Readings

Hon JO GOODHEW (Minister for the Community and Voluntary Sector) on behalf of the Minister of State Services: I move, That the New Zealand Public Health and Disability Amendment Bill, the Mental Health Commission Amendment Bill, and the Charities Amendment Bill (No 2) be now read a third time. These three bills until recently formed the constituent parts of an omnibus bill, the Crown Entities Reform Bill. The three bills all address the Government’s priorities for the State sector, with a view to delivering better quality services to New Zealanders. These priorities are reducing State sector fragmentation, increasing the viability of Government functions by having them carried out by larger, more resilient agencies, and increasing State sector efficiency by reducing duplication of services and back-office functions.

The content of these bills has already been comprehensively addressed in previous speeches. However, I will now briefly recap what each bill will accomplish. The New Zealand Public Health and Disability Amendment Bill disestablishes the Alcohol Advisory Council of New Zealand (ALAC) and the Health Sponsorship Council. In their place, the bill establishes a new Crown entity, the Health Promotion Agency, which will take on the health promotion functions of ALAC and the Health Sponsorship Council, and will have a wide mandate to carry out other health promotion programmes, as well. The bill also disestablishes the Crown Health Financing Agency, because it is intended that its functions will now be carried out by Treasury and the Ministry of Health.

These proposals have received widespread support from both the health sector and the House. It is encouraging that many recognise the benefits that the new Health Promotion Agency will provide, with its strong focus on integrated health promotion. The Government believes that the integration of ALAC, the Health Sponsorship Council, and other health promotion functions will lead to real administrative efficiencies and better health and well-being outcomes for New Zealanders. It is pleasing to see a wide level of support for these goals.

The Mental Health Commission Amendment Bill brings forward the disestablishment date for the Mental Health Commission, which was 31 August 2015, to 1 July 2012. It also establishes a Mental Health Commissioner within the Office of the Health and Disability Commissioner, whose functions will be to monitor and advocate for improvements to mental health and addiction services in New Zealand. This change will put an end to the uncertainty created by repeated extensions of the Mental Health Commission’s disestablishment date. It will secure a home for mental health advocacy and monitoring in an independent, well-established Crown entity. The bill gives strength and robustness to the new Mental Health Commissioner role by establishing it in statute, making the Mental Health Commissioner the only deputy commissioner so established.

The new mental health functions will achieve efficiencies by reducing the duplication of back-office services, and will align and integrate well with the Health and Disability Commissioner’s current service improvement functions, in line with the Government’s priorities for the State sector.

The Charities Amendment Bill (No 2) disestablishes the Charities Commission and transfers its functions to the Department of Internal Affairs, except for the registration and deregistration of charities, which will be performed by an independent statutory board of three persons. All the functions and duties that the Charities Commission currently performs under the Charities Act 2005 will remain. Indeed, the promotion of trust and confidence function is moved into the Act’s purpose section, reflecting its importance.

The bill’s changes are structural only, and reflect Government priorities of reducing State sector fragmentation, improving the resilience of functions by having them carried out by larger agencies, and promoting efficiency by integrating similar functions and back-office services. The bill preserves the independence of the charities registration and deregistration functions by providing in law that Ministers may not give any direction to the board or to the Chief Executive of the Department of Internal Affairs in respect of these functions. The Department of Internal Affairs has extensive experience supporting independent boards and offices of this kind. In all other respects, the Chief Executive of the Department of Internal Affairs will be responsible for carrying out the functions set out in the Charities Act and will be responsible to Parliament for its performance in this regard. The Government has every confidence that the charities sector will continue to receive a high level of service and support under the bill’s new arrangements.

Overall, these bills will lead to greater efficiencies in the State sector, and, ultimately, better services for New Zealanders. It is with these goals in mind that I commend these bills to the House.

IAIN LEES-GALLOWAY (Labour—Palmerston North): It is a pleasure to speak on these three bills, the New Zealand Public Health and Disability Amendment Bill, the Mental Health Commission Amendment Bill, and the Charities Amendment Bill (No 2), which, as the Minister for Community and Voluntary Services pointed out, are the bills formerly known as the Crown Entities Reform Bill. On this side of the House, we actually agree with the decision to split that single bill into three bills—we think each of those component bills is quite distinct in its nature, and it is for that reason that I would like to make it clear that on this side of the House we believe there should be three questions put, so that members have the opportunity to make their views known on all three bills. I appreciate the positive affirmation I am getting from the Deputy Speaker about that. So we look forward to being able to vote on each of these three bills.

As was pointed out by members on this side throughout the debate on these bills, although superficially there are some similarities, in that essentially they legislate for the merger and acquisition of a number of public entities—which is, I suppose, the only approach that this Government has to the public sector—the outcome from those mergers is quite different in each case. We have been very supportive of the establishment of the Health Promotion Agency, which, of course, will be the result of the merger of the Health Sponsorship Council and the Alcohol Advisory Council (ALAC). The Health Sponsorship Council, of course, was originally established to promote activities that reduce the harm caused by tobacco, but people will probably remember it most for its role in supporting those organisations that had hitherto been dependent upon tobacco industry sponsorship. I do not want to traverse all the different organisations that received tobacco industry sponsorship, but, needless to say, some of them seemed quite perverse. When sports or ballet companies, for instance, or even orchestras and bands, were supported by a tobacco company, you have to think what the performance of those sports teams would be like if all their members were smokers. What would the performance of a ballet troupe be like if all its members were smokers? What, indeed, would the performance of the woodwind section or the brass section of a band be like if all of its members were smokers? So it was unusual, I think, that all those organisations were so dependent on—

Hon Ruth Dyson: You could do it with alcohol.

IAIN LEES-GALLOWAY: Well, I am coming to that, Ms Dyson. It was unusual that so many organisations were dependent on the tobacco industry. And I know that there was a lot of nervousness amongst those organisations that they would not be able to find replacement sponsorship if they were unable to get that support from the tobacco industry. What the Health Sponsorship Council did, in a way, was to be a kind of nicotine patch for those organisations. It helped them wean themselves off that addiction they had to funding from the tobacco industry.

I note that the Cancer Society, when it made its submission to the Government Administration Committee on the Crown Entities Reform Bill, submitted that part of the Health Promotion Agency’s core business should be addressing the issue of alcohol sponsorship, which my colleague Ruth Dyson alluded to moments ago. I think this is a worthy consideration, and Parliament should take the next possible opportunity to consider the Health Promotion Agency’s role in reducing the impact of alcohol sponsorship. What getting rid of tobacco sponsorship was about was a public health measure to reduce not the availability but the normality of tobacco in our communities. I guess what the Cancer Society is getting at is reducing the normality of the presence of alcohol in sporting events, for example. I mentioned during one debate on this bill that students associations have a very close relationship with the liquor industry, and there is a wide range of other organisations that do probably feel dependent on sponsorship from the alcohol industry.

I think the Cancer Society has a good point that is worthy of debate at the very least, and that is around the Health Promotion Agency’s role in reducing the influence of alcohol sponsorship and assisting organisations through the same transition that had to be made when tobacco sponsorship was brought to an end. That is obviously something for Parliament to consider in the future, but certainly the establishment of the Health Promotion Agency makes that initiative far more likely, especially seeing as the expertise of both ALAC and the Health Sponsorship Council will be brought together.

Although we support the creation of the Health Promotion Agency, I would like to point out some of the inconsistencies in Government policy. You simply have to look at the Budget that was announced last week to see how inconsistent this Government is on the issue of public health. Although it is establishing the Health Promotion Agency, it is also cutting $80 million worth of public health programmes over the next 4 years. We have no idea which, because, of course, the Budget documents are purposefully vague as to which programmes are being cut; I look forward to hearing what the Minister of Health can tell the Health Committee about which programmes those are. Of course, these are the public health programmes that actually save us money in the health sector in the future. It is an investment in the health and well-being of New Zealanders for the future, and it will save our health system money. But this Government is not interested in the future; this Government is interested in the here and now, and it has sucked money out of those public health programmes to put into its pet projects, its politically motivated projects in the health sector. So there is a very, very inconsistent approach on public health from this National Government.

The second bill that we are debating this evening is the Mental Health Commission Amendment Bill. I do not have too much to say about this bill, other than to say that we look forward to the release of the second mental health blueprint, which I understand is due to be launched on 13 June. That will be an important step forward. Of course, that will actually be the final act of the Mental Health Commission, and that blueprint document will have to be picked up and guided through its infancy through the Health and Disability Commissioner.

I know that a number of submitters to the select committee expressed some concern and disappointment about that, but that is the nature of what this Government is about. It has no particular plan for growing the economy, and therefore what it has to do to balance the books is these little tinkering mergers within the public sector to save a penny here and a dollar there so that it can make up for its abysmal failure to grow the economy and bring in the revenue that is required to run these public agencies properly. I think it reflects the incompetent management of the economy by this Government, the negligence that we have seen from John Key. That is what we are seeing in these bills, which really are tinkering around the edges and will save very, very little.

I think the Minister actually referred to the fact that these are structural changes that will have no impact on the outcomes for these organisations. They will have no positive public health impact, and they will have no positive impact on the delivery of mental health services. And, as my colleagues will get to later on, as for the changes to the Charities Commission, well, that is just utterly negative, but it is driven by a desperate need within this Government to find any little cuts that it can to make up for the appalling lack of effort in growing the economy and bringing in the revenue required. We have a range of positions on these bills, being that they are three different bills, which will become clear at voting time.

CHRIS AUCHINVOLE (National): It is with pleasure that I stand to speak on these three bills that we have before us: the New Zealand Public Health and Disability Amendment Bill, the Mental Health Commission Amendment Bill, and the Charities Amendment Bill (No 2). I am always a little saddened to hear desultory commentary from the speakers from the other side, because, basically, this is a good thing, and I think they agree with it—I think they agree with it.

Iain Lees-Galloway: Is it good news? Is it good news, like Hekia’s good news?

CHRIS AUCHINVOLE: Well, I do not know about good news, but it is a necessary change to bring about better services, and that is what it is all about. Although the Crown Entities Reform Bill had been introduced before I joined the Government Administration Committee, it has been a pleasure to discuss it with other members of the select committee who were involved.

Let us begin, if we may, with the New Zealand Public Health and Disability Amendment Bill. This bill relates to the establishment of the Health Promotion Agency—HPA; we love acronyms, do we not—as a Crown agent, and the disestablishment of the Alcohol Advisory Council (ALAC), the Health Sponsorship Council, and the Crown Health Financing Agency.

There would be some who could be concerned when they heard about the disestablishment of ALAC, that organisation that has done such a splendid job over such a long period in New Zealand. However, they need not be disconcerted by that. The bill provides that the new Health Promotion Agency’s board will have at least five but not more than seven members appointed by the responsible Minister. Levy provisions carried over from the Alcohol Advisory Council Act 1976 will enable the Health Promotion Agency to recover certain of its operating costs. I think this is probably one of the most key reassurances that can be provided for those who have a particular interest in the activities of ALAC. The money that it has been getting from levies is ring-fenced. The money is dedicated to the purposes of controlling alcoholism.

In respect of the Health Promotion Agency’s alcohol-specific functions, therefore—the advice, the recommendations, the research relating to problems associated with the misuse of alcohol—the Health Promotion Agency will be required to have regard to Government policy when directed by the responsible Minister, rather than being required to give effect to Government policy. It has to have regard for it, so there is a fair bit of latitude over how it responds.

Let us look at the Mental Health Commission Amendment Bill, which was Part 2 of the Crown Entities Reform Bill. This bill relates to the expiry of the Mental Health Commission Act 1998—and let us remember that it had an expiry; it was due to end—and the appointment of a Mental Health Commissioner under the Health and Disability Commissioner Act 1994. The Act will now expire on 30 June 2012, rather than on 31 August 2015.

Quite a lot of discussion has been given to the Mason report. I have been privileged to meet with Judge Mason on a few occasions. He is, in fact, from the West Coast of the South Island. He is a guy who has tremendous interest in mental health, and his report is a standpoint for the development of mental health services.

The new bill provides for the appointment of a Mental Health Commissioner under the Health and Disability Commissioner Act 1994, and for the appointment of the chairperson of the Mental Health Commission as the first Mental Health Commissioner. If we have a look at some of the key points associated with these changes, disestablishing the Mental Health Commission and establishing the new Mental Health Commissioner within the Office of the Health and Disability Commissioner will enable a continued focus on the mental health sector’s performance while benefiting from reducing the corporate governance overhead.

In all these moves, and in other Government departments where we have brought about these changes, what we have had is a synergy of professionals working together. The product is most worthwhile. This bill provides an enduring solution to the expiry of the Mental Health Commission in 2015, establishes a new Mental Health Commissioner, and transfers the existing Mental Health Commissioner, Dr Lynne Lane, to the new position to provide continuity and leadership from a respected leader in the mental health sector.

We then come to the Charities Amendment Bill (No 2). This bill is probably the most controversial of the three, I would think—the most controversial of the three. This bill disestablishes the Charities Commission, and reassigns its functions and duties under the Charities Act 2005 to the Chief Executive of the Department of Internal Affairs, with the exception of the registration and deregistration of charities, which will be carried out by an independent decision-making board of three persons.

This bill provides that the chief executive must supply all secretariat and administrative services required to enable the independent board to carry out its functions, duties, and powers. The independent—and let us emphasise that independent aspect—board may delegate its functions, duties, or powers to the chief executive, but the chief executive must act independently in exercising such delegated powers and is not responsible to the Minister in this regard. That is a key aspect of this legislation.

I support the legislation. Thank you.

Hon RUTH DYSON (Labour—Port Hills): It gives me a lot of pleasure to speak in the third reading of these three bills—the New Zealand Public Health and Disability Amendment Bill, the Mental Health Commission Amendment Bill, and the Charities Amendment Bill (No 2)—which previously came under the Crown Entities Reform Bill. Can I begin by acknowledging the constructive way in which our Government Administration Committee worked on these three bills. There were a large number of submitters, some of whom were incredibly angry and frustrated and were in opposition to Part 3 of the Crown Entities Reform Bill. They were treated by all members of the select committee, including members who did not agree with their views, with the respect that I think gave both the members of the select committee and the submitters appropriate credit. So I just want to acknowledge that. I think it is a good way for the select committee to operate.

I also want to acknowledge our advisers. Generally, when you have a piece of legislation you get advisers from one department or agency, and in this particular instance we asked for advisers from three agencies. We had an adviser from the State Services Commission, one from—I am not entirely sure whether the person was from the Ministry of Health or the National Health Board—but a public health expert, and also an adviser from the Department of Internal Affairs. So I want to thank the Ministers for making those advisers available, and I also acknowledge the hard work that the advisers put in. In fact, it was a lot of work, right up to the last minute, when we had an unexpected change to some minor wording in the legislation. The advisers were able to just deal with that extraordinarily competently, as did our select committee clerks.

As previous speakers have noted, because of the very different nature of the three bills that we are considering, it is certainly appropriate for there to be three separate votes held on the legislation. There is a huge difference between the public health bill, the Mental Health Commission Bill, and the charities commission bill, and I certainly look forward to separate votes being held on those three bills, even though we are debating them all in one section in this third reading.

To just go to the first bill, the New Zealand Public Health and Disability Amendment Bill, I suppose the best thing you could really say about this is that it is the first thing in the public health space that has been done by the National Government, so that is a bit of a move in the right direction. Certainly, we heard from submitters on the legislation that even though the investment in public health—which we all know will reduce the need for further spending in health down the track, because if you invest in public health, you are less likely to need to invest in secondary and tertiary care later. But also, of course, investment in public health greatly contributes to the overall well-being of individuals and families and, therefore, our communities. So it is good that we have got some action in this space. It is just a real shame that the only action in the public health space is rearranging the agencies, rather than looking at a decent public health strategy and investment. Nevertheless, the submitters on this section of the legislation were pretty enthusiastic about it and that was good to hear.

In terms of the second part of the legislation, that was not as strongly supported. I guess the crux of it, from my perspective—and I recalled it at the select committee during the discussion—was that it took me back to the time when one of the most impressive actions took place in this Parliament. We have a lot of action in here, but not many of those actions are what you would really call truly impressive. That was when the Rt Hon Jenny Shipley and the Hon Helen Clark, as she was then, made a deal, basically, across the House. It was before other parties were in Parliament. It was a deal between the National Party and the Labour Party that mental health was going to start getting the respect and value and support that it needed within the health system.

We used to hear frequently that mental health was the Cinderella of the health system, and the most vulnerable people in our society, those who need support or services within the mental health system, were the people who were not only missing out on that support or services, but being used as political fodder and footballs, including in this very Parliament. The deal that the Rt Hon Jenny Shipley and the then Hon Helen Clark made at that time was that that should cease, and that we should start giving people within the mental health system proper respect and proper support. I think that was amazing leadership and I want to pay tribute to both those women.

We know from many discussions in this House about the establishment of the Mental Health Commission, about the blueprint money, about the ring-fencing of it, and how that was so important to people who could see the money always being pulled at by other parts of the health system. It is very rare that you get anyone in the health system saying: “Thank you very much. We’ve got adequate funding. Perhaps we’ve got a little bit too much. We’d like to give some back.” It is not a common occurrence in the health system. So there was a determination that that blueprint money would be ring-fenced for mental health.

Concerns have been well expressed about this part of the legislation in terms of maintaining that integrity. The new blueprint is coming out soon, in just a matter of weeks. We can never let mental health become the Cinderella of the health system again, and I want to put it on the record that Labour will not tolerate it. I implore members from all parties in the House to reflect on the agreement that was made between Jenny Shipley and Helen Clark, and say that for the most vulnerable—often—in our community that was a huge leap forward and we have a responsibility to maintain it. So whether it is the functions of the new commissioner as proposed in this legislation, whether it is the maintenance of the ring-fencing of the blueprint money, whether it is the funding level increasing at appropriate levels—we know that in the last three Budgets the blueprint money has not been reached, the target has not been reached, and that is a shame—or whether it is the proactive approach, the independence, and the advocacy that the current Mental Health Commissioner is able to act on, those are functions that we will be monitoring, because this will pass into law and it is just too important an issue to say “Well, whatever happens, happens.” So that is notice, really, to the House that this is not an issue that is going to go away. It is going to be very, very closely monitored on behalf of people who often do not have the access or the ability or the voice to speak for themselves.

I come to the Charities Amendment Bill (No 2), arising out of the third part of the original bill. I challenged my deputy chair, Chris Auchinvole, to name one submitter in support of this part of the bill and I did not hear him mention one submitter. We had a large number of submitters talking about this part of the original bill and I do not think that I could express strongly enough in appropriate language in the House their opposition. There was nobody who thought this was a good idea. There were a lot of people who thought it was particularly foolish, and all the submitters said it went against the very intention of the Charities Commission legislation.

So this legislation arising out of the third part of the original bill should not proceed, in our view. It is just total nonsense. We had organisations like the Todd Foundation and the Tindall Foundation—they are quite big. The Todd Foundation—have you heard of them—and the Tindall Foundation? Quite big in this sector! Philanthropy New Zealand is quite a big organisation, which represents every single philanthropic group in the country, and we had the Association of Non-Governmental Organisations of Aotearoa, which represents every single community and voluntary sector organisation. So all the key players in this space said this is nonsense, and this is going to totally undermine the independence, the autonomy, and the integrity of our charitable sector, which this Parliament works so hard to create. And the reason that Minister Goodhew gave for introducing it—that somehow it is all going to be all so efficient and effective—was just nonsense. Well, “If it’s not broke, don’t fix it.”

But also, more than that, at the moment there are two major reviews going on: one is already under way, and one is about to commence. One is the review of the incorporated societies legislation and the other is the review of the Charities Commission legislation. Why on earth would you make huge structural change to the very nature of the Charities Commission—basically gut it—and put it into a department, which for all the fine words from those opposite cannot be independent from a Minister, because it is a Government department, not an independent Crown entity? Why would you do that? Why would anyone do that sort of change when neither the incorporated society review nor the charities review—

Mr DEPUTY SPEAKER: Order! The time has expired. [Interruption] Order! I have indicated to the member that her time has expired. Thank you.

KEVIN HAGUE (Green): I would like to begin by endorsing the remarks—pretty much all of them, actually—that Ruth Dyson made in her contribution, but I was particularly thinking of the ones about the excellence of the select committee process and how well that went.

You know, this debate on the third readings of these three bills comes on top of quite a series of contributions I have made in the debate on the previous bill, the Crown Entities Reform Bill. That bill and these three bills now at the third reading range from the sensible and quite exciting through to the irredeemably stupid, and I want to just run through some principles that might assist the House in distinguishing between them. It seems to me that if a Government is contemplating merging Crown entities, then there are some tests, some thought experiments, that perhaps should be carried out to determine whether that is a good idea or not.

First of all—I am sure Government members will appreciate this—is the function necessary? Is the function of this entity a necessary thing? Secondly—again, I am sure the Government members will agree with this—is the function appropriately one for the State? Again, that is an important test, is it not? Thirdly, are the functions of the entities that are proposed to be merged actually congruent? Does it actually make some sort of prima facie sense to merge these two things? Would they work together? Fourthly, what are both the financial and the non-financial benefits and disadvantages of what is proposed? Quantify them and balance them off one against the other—the benefits against the disadvantages—and proceed only if it has a positive balance. It makes sense, does it not? Then, finally, I suggest that the next test is how easily the gains are realised. Because, as I have said on a number of occasions in debates on the Crown Entities Reform Bill, the fact is that the experience of State sector changes over the past several decades is that it is extraordinarily difficult to realise the gains that are promised by the business case. Actually, we have not seen the business case for any of these mergers, so we do not even know, really, what is promised. But the reality is that the experience of the mergers that have taken place in the State sector over some quite considerable time is that usually the benefits are not realised, at least to the extent that is promised.

So there is a framework for assessing those changes, and when we look at the first of these bills, the amendment to the New Zealand Public Health and Disability Act to create this Health Promotion Agency, we can say not only that this is a desirable function but that it is an extremely important one, and it is one that in this country, as the social determinants of health are eroded further and further by successive Government actions, becomes more and more necessary. So it is a highly important function that absolutely must be carried out by the Government. That is what the Ottawa Charter is all about, and Government members have talked about how important this is as a means of operationalising the Ottawa Charter.

Are the functions congruent? Well, these great organisations, the Health Sponsorship Council and the Alcohol Advisory Council, who have done a fantastic job over the years, do, in fact, have highly congruent functions, and, actually, the work of each will be advantaged by being in the same pot as the other, let alone the other functions that could be added to that. I again remind Government members that I am looking to see this agency become more and more the engine for health promotion in New Zealand.

What are the financial and non-financial benefits? Well, I think there are clearly some significant efficiency gains from this particular change, and it seems to me that there is very little in the way of a downside, so that balance looks to me to be positive, and those gains ought to be relatively easily realised. So that is a green light on all of those aspects of my test.

Then we come to the next bill, the Mental Health Commission Amendment Bill. Is the function necessary? Absolutely it is, for the reasons that Ruth Dyson has very ably outlined tonight. Is the function appropriately one for the State? Again, absolutely. The State is the planner and funder of mental health services for New Zealand. Although we have made dramatic advances, particularly in mental health services for those with serious mental illness, as a result of the changes that the Hon Ruth Dyson has outlined, there is actually still a long way to go with community-based mental health services, and that function must be carried out by the State.

Are the functions congruent? In this case, they are absolutely not—absolutely not. The functions of the Mental Health Commission have been long-term planning, and monitoring against that long-term plan. Those are very much helicopter-view functions and prospective functions, whereas the functions of the Health and Disability Commissioner tend, instead, to be very much analysing individual cases, looking at the micro situation, and usually working in retrospect to work out what we can learn from the thing that went wrong. These are both important sets of functions, but there is no congruence between them. So the marriage that is proposed by this bill is absolutely the wrong one.

What is the balance of benefits and disadvantages in this case? Well, there is a massive disadvantage in the risk that is posed to achieving the mission of the Mental Health Commission—a massive disadvantage—and the benefit is probably a small cost saving. Well, that is not a balance that passes my test. And the reality is that when you factor in on top of that the likelihood that that small cost saving may well not be achieved, or not be achieved in a realistic time frame, it suggests that that merger ought not to go ahead.

Finally, we come to the change that I described as irredeemably stupid, and that is the one around the Charities Commission. Is this function necessary? Absolutely, yes. Is this function one that should be carried out by the State? Well, that is kind of interesting, is it not? The whole point about the Charities Commission was to respect the separation between the State sector and the community sector, and to manage the interface between the two through an entity that was sufficiently distal from the core State to give trust and comfort to the New Zealand community sector. That is the point of the Charities Commission. So it is not appropriate for that function to be carried out in the core State service in the Department of Internal Affairs.

Are the functions congruent? Well, again, they kind of are. But that is not really the issue in this case. What is the balance between financial and non-financial risks and benefits? Well, in this case, the potential benefits are tiny. They are immaterial, and that has to be balanced against these huge risks around the total loss of trust from the New Zealand community sector in the interface between the State and the community sector. That is a test that this merger fails absolutely.

So let us by all means look at ways of improving the effectiveness and efficiency of the State sector and look at structural changes, but only one of these proposed changes actually passes a rational set of tests. That is the only one that we will support.

KANWALJIT SINGH BAKSHI (National): I stand to debate the third readings of the New Zealand Public Health and Disability Amendment Bill, the Mental Health Commission Amendment Bill, and the Charities Amendment Bill (No 2), which were formerly part of the Crown Entities Reform Bill. These bills provide the structural change to the way the Government is organised across the health and charitable sector. I would like to acknowledge the chair and other members of the Government Administration Committee. I would also like to acknowledge the officials for their hard work in the select committee process.

The first bill, the New Zealand Public Health and Disability Amendment Bill, relates to the establishment of the Health Promotion Agency, the HPA, as a Crown agent, and the disestablishment of the Alcohol Advisory Council, the Health Sponsorship Council, and the Crown Health Financing Agency. This bill provides that the new Health Promotion Agency’s board will have at least five members, but not more than seven members, appointed by the responsible Minister. The purpose of the bill is to create a Health Promotion Agency that is viable and able to supply better public health results.

The Health Promotion Agency will continue to implement the role established by the Alcohol Advisory Council. This agency has been proved to be invaluable in alcohol matters, and the bill ensures that the vital measures it previously enforced will continue under the Health Promotion Agency. Alcohol abuse among the young people of New Zealand has been smeared over the news for the past month. The Health Promotion Agency has promised that it will give its utmost priority to dealing with this issue. More than 2,000 young people end up in hospital with alcohol-related diseases.

The Mental Health Commission Amendment Bill brings forward the disestablishment of the Mental Health Commission, transfers its functions to the Office of the Health and Disability Commissioner, and establishes a new Mental Health Commissioner within the Office of the Health and Disability Commissioner. These changes will reduce duplication of the corporate and governance overheads and ensure that the agencies continue to deliver the front-line services that New Zealanders expect. I commend this bill to the House.

DENIS O’ROURKE (NZ First): New Zealand First has no comments on the New Zealand Public Health and Disability Amendment Bill or the Mental Health Commission Amendment Bill. We accept that some gains in mergers of agencies are appropriate where their functions are not compromised. But New Zealand First does oppose the Charities Amendment Bill (No 2). With this bill we say that the dead hand of Government bureaucracy will fall on the charities sector.

There is no need to disestablish the Charities Commission. It has been doing a very good job in a very short time. It has been building relationships within the sector and with the public generally. It has the confidence of the charities sector and has earned the confidence of the public. It has built expertise and institutional knowledge, which will not be replaceable. It has been providing leadership in the charities sector. It has been standing at arm’s length from the Government and its administration. And it has been positive, has had a helpful culture, and has exercised some flexibility in the way it went about its work. To put it in a nutshell, it has been a very successful commission in the job it is doing. There is simply no reason to disestablish it. What is being achieved by that? I see nothing in anything that I have read in the regulatory impact statement or have heard in listening to Government speakers that would justify it.

On the other hand, the Department of Internal Affairs is a quintessential Government bureaucracy. As such, it is, naturally, not good at consultation or public engagement. It will not be as accessible to the public or as approachable to people. It will not be as transparent in its decision making. It will do the job, I am sure, competently, but it will not provide any encouragement to the development of the charities sector in this country. So, again, it is very difficult to see why you would replace the commission with that.

We are told that the Department of Internal Affairs will be more efficient. In fact, I think the words used in one of the reports were “robust and resilient”. I do not really know what that means in this context, but I suppose it is aimed at saving money. That, in itself, is not very convincing, because I am sure it will grow and the savings will disappear over time. But, most particularly, I do not think the department will be effective at anything other than reflecting the Government policy of the day—that is what normally happens—whereas if the commission were to remain, we could be sure that there would be independence not just as a matter of statement, not just as a matter of intention, but as a matter of culture. That, essentially, is the difference between a Government department and a commission of this kind.

We are told, for example, in new section 8(4) in clause 45 that we do not have to worry about independence, because the words are there in the statute—that the Minister would not have any influence. But what does that really mean? Words in a statute are just that. Again, some Ministers may actually abide by that principle, but perhaps others would exercise some interference. That is the danger that many people see in the bill.

When you look at new section 10 in clause 45 you get even less confidence about independence, because new section 10 covers the functions of the chief executive. The chief executive cannot be independent of Government policy or the Minister, because they are part of a Government department. His or her independence is not covered at all in new section 10. The chief executive will be a very powerful person in practice, and in the section itself it refers to the chief executive issuing guidelines. Perhaps that really means instructions. The chief executive will issue model rules, so charities will no longer be as free to adopt their own set of rules under this regime. I do not think that is very positive.

Mike Sabin: It’s very positive.

DENIS O’ROURKE: Also, the chief executive will provide appropriate information. Somebody opposite just said that that will be positive. Well, if you actually asked the charities what they think about that, I do not think the response would be very positive at all. The chief executive will also be able—in fact, it will be the function of the chief executive—to present the recommendations to the board as to whether a particular charity be registered or not. The chief executive will also be responsible for the department’s monitoring and inquiring into charities. So when I say that this is a very powerful position in practice, what it really means is that the Government is going to take very firm control indeed of the charities sector, under this legislation.

The Government will, in fact, dictate to charities. Whereas charities thrive on diversity—they have passion for their causes, and they have a flair in achieving their objectives—those are all the things that a Government department is not good at and will not be able to assist them with. So although some structure was needed, what we did not need was a wholesale takeover of the charities sector by the Government through a Government department. The proper balance here was the commission, something that stood at arm’s length from the Government—genuinely at arm’s length—able to develop its own practice and culture, and yet exercise some control and regulation, which was needed, over the charities sector. So the balance that we would wish to have is already there and will be removed by this legislation.

A review of the charities sector was, in fact, needed, following, first, a review of the Incorporated Societies Act 1908. But that does not mean there was any need to even consider the disestablishment of the commission. What is actually needed with the charities sector is a close look at the definition of what a charity is and what it is not. The old four-part definition—of encouraging the purposes of education, religion, and the relief of poverty, and other purposes beneficial to the community—is no longer appropriate for the 21st century. There are so many other good public purposes that fall outside that definition. If the Charities Commission, as it now is, was empowered with much more forward-looking, up-to-date legislation that did address that issue of what is a charity and what is not in the 21st century, then we would have something worth considering this evening. But as it is, we are looking at a piece of piecemeal legislation that does not attack the major issue and does create a worse situation than we have already. So why would anyone not oppose this bill? It is simply not common sense, and it has got no chance of succeeding. It is simply the victim of some halfwitted approach to creating robustness and resilience or efficiency in the Public Service. Like so many of the other Government statements concerning so-called efficiencies in the Public Service, this is just a bad fit and is not going to work. It will not even create efficiencies or effectiveness or advance the cause, in this case, of any charities whatsoever.

This is not what the sector wants. The sector opposes this legislation, and it ought to know. The sector almost universally opposes it, and for the very good reasons that I and others have mentioned. So for that reason, New Zealand First will certainly be opposing the third part of the Crown entities legislation, relating to the charities sector. It is just bad legislation.

Dr CAM CALDER (National): It is a great pleasure to rise and take a very brief call on the bills arising from the Crown Entities Reform Bill, which at the Committee stage was divided into the New Zealand Public Health and Disability Amendment Bill, the Mental Health Commission Amendment Bill, and the Charities Amendment Bill (No 2). At this stage I would like to acknowledge the excellent chairmanship of the Hon Ruth Dyson. I am not a member of the Government Administration Committee, but I have been given a briefing by the deputy chairman, Mr Chris Auchinvole, who spoke of the excellent work and the collegiality on that committee.

The Crown Entities Reform Bill, as we said, has been divided into the three bills we have here. This is part of the Government’s overall programme to improve State sector performance as a whole. One of our four priorities, as we heard in the Budget debate earlier today, is to get better value from our public services—more efficient, more effective, better public services. We are about not growing the Public Service but growing services to the public. This means more front-line service delivery and more efficient back-office services. We are aiming to reduce the duplication of corporate and governance overheads, and ensure that agencies can continue to deliver the front-line services that all New Zealanders have a right to expect, and, indeed, do expect.

One of the things that I am particularly taken with is the establishment of a new Health Promotion Agency. With a background in medicine, I do believe that prevention has a huge part in improving the health of New Zealanders. The new Health Promotion Agency will take over the functions of the Alcohol Advisory Council of New Zealand—often known as ALAC—the Health Sponsorship Council, and the relevant functions of the Ministry of Health. The reason for this change is that it is part of the Government’s programme, as I said, to ensure that the State sector delivers efficient front-line services. We believe that reducing the number of Government agencies is likely to improve coordination, reduce fragmentation, and ensure that functions are delivered by agencies with greater resilience in a state of some uncertain and harsh economic times. We believe that, for instance, will allow efficiencies in the commissioning of television advertisements, and possibly in education resource production, just to show a couple of small examples.

This is an opportunity. It strengthens the focus on health promotion activity, as I say, also by transferring existing health promotion activity in the Ministry of Health to a focused health promotion entity. We believe this will create more opportunities for innovative and targeted approaches to those people in communities with multiple health issues. I commend these bills to the House.

LOUISA WALL (Labour—Manurewa): Talofa lava, Mr Speaker. Tēnā koutou katoa. It is my pleasure to rise and speak in this third reading debate, which is a summing up debate on what was the Crown Entities Reform Bill. I want to acknowledge that at this point in time we are discussing the New Zealand Public Health and Disability Amendment Bill, the Mental Health Commission Amendment Bill, and the Charities Amendment Bill (No 2). I want to speak exclusively about the Charities Amendment Bill (No 2).

What I am going to do is basically sum up the process that has led us to today. In terms of the background to the bill, the bill amalgamates the functions of a number of existing agencies to improve their financial efficiency—supposedly—and effectiveness, and to increase their future viability. Dr Jonathan Coleman was the Minister in charge of the original bill. The bill was first introduced on 29 September 2011, and it had its first reading on 4 October 2011. We obviously had a general election on 26 November 2011. It is worth noting that the Government Administration Committee, which was ably chaired by my colleague the Hon Ruth Dyson, reported back to the House on 30 March 2012. So I am sure that the people listening understand that there seems to have been quite a truncated process. In fact, one of the points that the select committee itself highlighted was that the process was interrupted by the end of the last Parliament, which further added to the confusion about the status of the bill. An extension of the deadlines for submissions resulted in some stakeholders being unaware that submissions had been called for.

On the key findings of the select committee report, it is interesting to note that there were 43 submissions received, 17 of which were oral. Of the 43 submissions received, 20 were specifically about the Charities Amendment Bill (No 2)—or Part 3 of the Crown Entities Reform Bill—and 19 of those submissions opposed it. So the charitable sector, in fact, was very clear that it opposed this bill, the Charities Amendment Bill (No 2). I also want to highlight that the select committee report about the Charities Commission component did acknowledge the strong concern expressed by submitters in relation to the disestablishment of the Charities Commission, and that not all members of the select committee were convinced that the legislative safeguards in the bill would be sufficient to maintain the degree of independence the Charities Commission provided. Members also expressed concern that some functions would be less accessible to the public and less transparent when transferred to the Department of Internal Affairs.

When we look at the Charities Act 2005 as it currently stands, there is a review timetabled. The Charities Act review is due to take place following the current review of the Incorporated Societies Act 1908. I want to make the point that the Labour and Green select committee members believe that the Charities Commission function should not be transferred to the Department of Internal Affairs, that no decisions on legislative or operational change should be made until the review of the Charities Act has been completed, and that the independence and integrity of the Charities Commission cannot be retained if the functions are transferred to the Department of Internal Affairs. At least on our side we were very clear that we did not want to see this part of the Crown Entities Reform Bill proceed, and our position has not changed.

I want to highlight that the report of the State Services Commission to the select committee noted the following points, and they are interesting. The first one I want to highlight is that there has been a lot of publicity about how efficient and effective, and what a cost-saving measure, merging the Charities Commission operations into the Department of Internal Affairs will be. So savings associated with disestablishing the Charities Commission were one of the main rationales for this part of the bill. What the officials acknowledged was that many submitters believed that savings from disestablishing the Charities Commission were doubtful. The officials themselves said that one of the critical rationales for the Government’s proposal to merge the Charities Commission with the Department of Internal Affairs was doubtful. I want to put that on record. Another key theme that emerged, and this is again from the State Services Commission’s report to the select committee, was that the independence of the Charities Commission’s functions would be compromised by transferring them to the Department of Internal Affairs—highlighting the autonomy and independence of the commission. The second point was that the Charities Commission’s role of educating the charitable sector would be compromised by transferring the functions to the Department of Internal Affairs. The other point I want to make is that the Charities Commission should be retained in its current form until after the completion of the review of the Charities Act 2005.

It has been interesting, as the Labour spokesperson for the community and voluntary sector, to have an opportunity to engage with our sector and to listen to what it had to say about the proposal in the Crown Entities Reform Bill in terms of merging the Charities Commission with the Department of Internal Affairs. I would like to read a couple of quotes.

I have one here from Dave Henderson, who is coordinator of ANGOA, which is the Association of Non-Governmental Organisations of Aotearoa. It works in the areas of health, education, recreation and sports, international development, human rights, arts, culture and heritage, social services, family budgeting, hospice care, disability, conservation and the environment, child and youth support, women, mental health, aged care, refugee support, family planning, prisoners and family support, injury prevention, and ethnicity. I want to quote Dave: “The change being forced through Parliament actually does not address the real issue that community sector organisations have been raising consistently with Government for several years: that a review is seriously needed of the way the 2005 Charities Act is being interpreted. Community organisations and charities have been asking for the planned review of the Act to be brought forward from 2015 so the Commission can be given a better steer on its interpretation of certain clauses. Just a few of its decisions have been ill-founded, and as a result have been damaging to community organisations. Instead of addressing those real issues, this Government is simply axing the Commission, but it has still not committed itself to bringing forward the review, which community groups are still saying is what’s really needed. Question to the Minister: will the Government commit to addressing those real issues with urgency after this bill has gone through?”. I guess that that is the challenge for the Minister. Will the review take place? Will the sector be involved?

I want to read another quote, from Tina Reid, the Executive Director of Social Development Partners, which is a member of ComVoices, an independent network of tangata whenua and leading national community and voluntary organisations. She agrees with Dave, but she wants to add this: “My further point is that we have always valued an independent commission being in a position to speak up for the sector outside of Government policy. Over the last 4 years they have had a major workload to establish the regulatory function of the commission, and it is only in their last year that there has been the opportunity to develop the functions to support and advocate for the sector. We are concerned that this will be lost by losing its autonomy.”

I want to reiterate that on this side of the House we will be voting with the community and voluntary sector. We have heard them. So it is my pleasure to say that we oppose the Charities Amendment Bill (No 2), and I look forward to working with the sector, because this issue is not over. Kia ora.

MIKE SABIN (National—Northland): I was not a part of the Government Administration Committee, but I am very pleased to be able to take a short call on this legislation. We have heard calls from the Opposition, not unsurprisingly, about the minuscule savings: “It’s a few million here, a few million there.” It seems to be a theme that creeps through. The savings we are talking about are in the order of $19.6 million over 4 years—$4.1 million per year ongoing.

Iain Lees-Galloway: That’s huge!

MIKE SABIN: We hear comments from across the floor, as usual, because they are quite flippant with their regard to taxpayers’ dollars. A few million here, a few million there, soon becomes a few billion here and there, which is pretty much why this country was going into recession in 2007, after 7 or 8 years of their “a few million here, a few million there” of taxpayers’ dollars. I have not had an opportunity yet to speak in the Appropriation (2012/13 Estimates) Bill debate, but I am very much looking forward to that.

Charles Chauvel: And we’re looking forward to you.

MIKE SABIN: I will fix my tie. Thank you, Mr Chauvel, I appreciate that. Thank you very much.

Charles Chauvel: Always looking after your interests.

MIKE SABIN: It must have got a bit out of shape after my time in the gym. But really what we are talking about here is a continuation of the theme in Budget 2012. One of the key planks in that Budget is about delivering better public services. That really is at the heart of what these three bills, the New Zealand Public Health and Disability Amendment Bill, the Mental Health Commission Amendment Bill, and the Charities Amendment Bill (No 2), are about.

What we are talking about is part of the Government’s overall programme of improving State sector performance. This reflects an ongoing willingness by this Government to show some leadership in finding efficiencies and ensuring the very best use of taxpayer dollars in delivering public services.

Of course, the Opposition does not seem to think that that is a very important thing to do. That pretty much sums up why those members are sitting on that side of the House. To be quite honest, although they spend most of their time opposing, it is a fairly good gauge to members on this side of the House that we are heading in the right direction. It is something that seems to be fairly well supported by those in the public, when you look at the polls and the 20-point difference that exists between the two major parties. I think that pretty much sums it up. This is about efficiency. This is about service delivery. This is about getting better synergy in terms of backroom functions. These are all very important in these tough economic times when we are making sure that we get the best bang for buck for the taxpayer.

I want to just briefly come to the three specific bills.

Kris Faafoi: It’s about time.

MIKE SABIN: Thank you, Mr Faafoi, for that valuable contribution. The first bill, the New Zealand Public Health and Disability Amendment Bill, relates to the establishment of the Health Promotion Agency as a Crown agent and disestablishes the role of the Alcohol Advisory Council, the Health Sponsorship Council, and the Crown Health Financing Agency. In respect of the Health Promotion Agency’s alcohol-specific functions, the Health Promotion Agency will be required to have regard to Government policy when directed by the responsible Minister, rather than being required to give effect to Government policy. As a former drug educator, I see great advantage in this, and certainly commend this move.

The second bill, the Mental Health Commission Amendment Bill, relates to the expiry of the Mental Health Commission Act 1998 and the appointment of a Mental Health Commissioner. The Hon Ruth Dyson made a comment about the agreement reached by Dame Jenny Shipley and Helen Clark, and their commitment to mental health. I want to endorse those comments made by the Hon Ruth Dyson. What I actually believe we are doing here is reinforcing the importance of mental health approaches and the responsibility that Government must have in this very concerning area.

Thirdly, if I can just turn to the Charities Amendment Bill (No 2), this is the one that seems to have created the most interest—if I can put it that way—from some of the submitters. The Charities Amendment Bill (No 2) sees the disestablishment of the Charities Commission and the reassignment of its functions and duties to the Chief Executive of the Department of Internal Affairs. There is some call that this will somehow lower the independence and bring it into some murky, dark lands of Government departments. Quite simply, I do not accept that. I think it is probably more an opportunity for Opposition members to try to score a few points where they have failed to in the other areas. They know that this is good law. They know that this is about continuing to drive better efficiencies in our public service delivery. They know that this is about better use of taxpayer dollars. They will oppose it. That is usually a fairly good indicator we are on track. This is nothing less than what the New Zealand public expect of us, it is what they deserve of us, and I am very, very happy to commend these three bills to the House.

KRIS FAAFOI (Labour—Mana): Taloha ni. For those people watching Parliament TV tonight—just in case they went to get a cup of tea while Mike Sabin was talking, and I do not blame them—I would like to just remind them what we are actually debating here tonight. We are debating the New Zealand Public Health and Disability Amendment Bill, the Mental Health Commission Amendment Bill, and also the Charities Amendment Bill (No 2). But Mr Sabin, in his contribution on those three bills, which I would like to remind those people who are watching tonight that we are debating, talked about front-line services and the agenda of this Government to make sure that front-line services are delivering better for all New Zealanders. I would like to just remind Mr Sabin—or maybe he has not read the papers in the last couple of days—about the front-line services that have been affected in the education sector. Maybe Mr Sabin might want to go and have a look and read the Dominion Post, or maybe the local paper up in Northland, just to see the front-line changes that this Government has announced, and the back-pedalling—the significant amount of back-pedalling—that is happening with the Government’s announcements in the Budget with front-line services.

Can I turn to the New Zealand Public Health and Disability Amendment Bill, after rebutting some of the points that Mr Sabin has made, and just talk about—and Mr Sabin used the word—the synergies that will come about from bringing the Alcohol Advisory Council (ALAC) and the Health Sponsorship Council together in the Health Promotion Agency. We do agree with that measure that is contained in this legislation. We do believe that bringing together two agencies like ALAC and the Health Sponsorship Council, which has done such good work in terms of its promotion of the anti-smoking message, is a good move. I would like to thank the board of ALAC, and also Gerard Vaughan, the Chief Executive of ALAC, for the work he has done over many years. We do hope that that new agency does good work.

I know there was some concern during the select committee stage, and especially from Alcohol Healthwatch, which did not agree with the merger of those two agencies. In its submission to the Government Administration Committee it said: “However, the establishment of the new entity—the Health Promotion Agency—appears to be driven by cost cutting measures rather than a desire to see better health outcomes for New Zealanders. This is of great concern to us given that any cost savings will not necessarily be increasing investment in health.” Although Labour is supporting this measure in the first of the three bills that we are debating here tonight, we will be keeping a close eye on that measure, to make sure that the synergies actually do deliver and that it is not just cost savings that we are looking at.

Can I now turn to the Charities Amendment Bill (No 2), which is the most contentious part of the legislation. Mr Sabin said this was the most debated or interesting part. I think the correct term may be that this is the part of what was the Crown Entities Reform Bill that got the most opposition. Of the 43 submissions on the bill, 20 were specifically in opposition to it. I would like to just point out the comments made by the United Future leader, Peter Dunne, who was very, very, I believe, supportive of some of the moves around this area. I would like to just point out an email that was sent to me by Mr Robin Gunston, who was one of my electorate in Mana and who was also, funnily enough, a United Future candidate in Mana.

Hon Ruth Dyson: Who was it again?

KRIS FAAFOI: Robin Gunston, who helpfully sent me an email. [Interruption] He did. He said: “I am writing to you to ensure that as a local MP you are fully aware of the proposed Government changes to the future of the Charities Commission, which we in the sector are deeply concerned about. My wish and those of the boards and volunteers of the various charities I represent would ask Parliament to drop the Charities Commission from the Crown entities that the Government is seeking to reform at this stage.” He goes on to say: “The monetary savings are minuscule, but we cannot afford to lose the independence of the Charities Commission at this juncture. There is time to do this in the 2015 sectoral reform already announced.” Mr Gunston goes on, and I would just like to remind the House that Mr Gunston was a United Future candidate: “Through the meetings and phone calls that we have had with Ministers it has become clear that the ramifications or timing of this were not especially well-thought-through, and aside from the hoped-for cost savings there does not appear to be overwhelming evidence to support the move, certainly not that the Ministers have articulated.” I do want to note that Trevor Mallard moved Supplementary Order Paper 32 in the Committee stage to delay this by 3 years. That was not picked up, and that is very unfortunate.

Dr Paul Hutchison: Mr Speaker—

The ASSISTANT SPEAKER (H V Ross Robertson): This is a split call, I am sorry to say to the member. It is a split call between Labour and the Greens. The Green member of Parliament is seeking the call.

DENISE ROCHE (Green): Talofa lava, Mr Speaker. Tēnā koe. I am going to restrict my comments to the Charities Amendment Bill (No 2). My colleague Kevin Hague has already spoken very eloquently on the other parts of the legislation, and he has the expertise in that area. There is a little saying that goes: “No good deed goes unpunished”. This is clearly the case with the Charities Commission, because it is being punished. In the debates, in all the speeches, and in all the readings of this legislation, not one single person has said that the Charities Commission is failing. Not one person has said that it needs reform in order for it to do its job properly, because it does do its job properly. It is as trim as it can be, and it is still effective.

This is from the Charities Commission’s statement of intent: “The Commission is very mindful that we will be operating in an environment of limited resources and have been told not to expect additional funding for the next three to five years.” It goes on to say that it will meet the outcomes that it is expected to meet. These outcomes include that the public is better informed about registered charities, that charities are better informed about effective governance and management practices, and that the Government is better informed about charities.

Without this law change, this is what the Charities Commission already does. It promotes public trust and confidence in the charitable sector, it provides education, and helps with registration, it registers charitable entities and maintains a register, it monitors charitable activities and entities, it investigates any wrongdoing and breaches of the Act, and it monitors and promotes compliance with the Act, including taking prosecutions. All in all, it is about creating—and it has done this—and maintaining transparency in the community and voluntary sector. Incorporating the Charities Commission into the Department of Internal Affairs will change how effectively this independent organisation operates.

Yesterday I cornered the Hon John Banks to ask for his support to stop this bill, and he declined. But I thought it was worthwhile to ask him, because his predecessor in the House, the Hon Rodney Hide, complimented the Charities Commission recently in an article in the National Business Review. He was particularly complimentary about the Charities Commission database, which he said is the best Government database on the internet. He goes on to say: “There’s every charity, with all their relevant information and, critically, the database is easily searchable by the likes of you and me.” He points out that there is a lot of money washing around in the sector, citing a total of $350 million a year in rebates from donations, and an estimated $1.5 billion in tax breaks for charitable businesses. So there is really a need for very good scrutiny. He notes that the Charities Commission has a good reputation and already does the joined-up thinking that this Government wants to achieve by putting it into the Department of Internal Affairs. I never thought I would ever agree with Mr Hide, but there you go.

Last week I also door-stopped the Hon Peter Dunne when I caught up with him in the lift, and later, when I followed him down Lambton Quay. He said that the community and voluntary sector was overreacting—that is right. He dismissed the concerns of the entire sector by saying that he maintained the Charities Commission would keep its independence because it is just like the Gambling Commission. But it is not just like the Gambling Commission. The Gambling Commission sits outside the Department of Internal Affairs. It acts as an appeal for decisions that are made inside the Department of Internal Affairs by the department’s investigators. The Gambling Commission, moreover, does not assist the industry with education as part of its raison d’être.

I would urge members to vote against the Charities Amendment Bill (No 2). It is not needed, and it is unlikely to ensure transparency. In the big things it does not save a lot. It is premature, as Louisa Wall has already outlined. The Charities Commission is already effective and independent, and, honestly, it is a huge leap backwards. Thank you.

Dr PAUL HUTCHISON (National—Hunua): Talofa lava, Mr Speaker. It is a pleasure to speak on these three bills, the New Zealand Public Health and Disability Amendment Bill, the Mental Health Commission Amendment Bill, and the Charities Amendment Bill (No 2), all of whose genesis emanates from the Crown Entities Reform Bill, from which this debate started. I was heartened to hear the Hon Ruth Dyson mention how well the Government Administration Committee functioned, even though there was slight disagreement on the third-mentioned bill. Ruth Dyson did say that there was considerable enthusiasm for the New Zealand Public Health and Disability Amendment Bill, and I am very glad to hear that. But I think it is important that she does understand what this is all about. It is all about improving financial efficiency and effectiveness and increasing the future viability of these agencies.

There is absolutely no doubt that making every dollar count in this current environment is absolutely vital. We find so often that those on the other side of the House tend to just forget about it. There is no question that in the area of health we saw the health budget double over 9 long, arduous years, for very little gain. Money was sprinkled all over the place, for very little gain, and that is why it is so important that this excellent National Government does concentrate on making every dollar count.

I did like the line from Dr Cam Calder that the National-led Government is not about growing the Public Service but about growing services to the public. This means more front-line service delivery and more efficient back-office services. Today at the Health Committee I was very impressed to hear Dr Lester Levy, Chief Executive Officer of the Waitematā District Health Board and the Auckland District Health Board, recount how effectively back-office services had been used, with focus on increasingly effective and efficient front-line services. I also had a briefing from New Zealand Trade and Enterprise today, and it is doing a similar sort of thing. Right throughout the Government service, this excellent National Government is concentrating on extra efficiency and effectiveness.

I was interested to hear Kevin Hague say that it is often very difficult to see the benefit of structural change. That is so. It has always been of huge concern to me the massive structural change that occurred in 1999—well, a few years after 1999—when the Labour Government decided to absolutely restructure the health system. It is very hard to see, as Mr Hague pointed out, where the gains have come. It has really been only in the last 4 years that we have seen significant gains in the health sector, under the excellent leadership of Tony Ryall. The establishment of a new Health Promotion Agency is something very much dear to my heart, and, again, as Mr Hague pointed out, he very much hopes to see this as the engine that drives positive changes. I am sure it will be.

Back in 1999 the advice to the incoming Minister of Health was that the greatest gains in health would come from health promotion, disease prevention, and the integration of primary and secondary health. That is hugely important, and it is being very much worked on by this excellent National Government, whereas there had certainly been a large gap in the previous 9 years.

Again, I did take note of the Hon Ruth Dyson when she mentioned the great concern about mental health in the 1990s, and the fact that the leaders of the major parties agreed that this was an area that had to be sorted out—hence the Mason inquiry, hence the blueprint, and hence the ring-fencing of the funding. Consequently, it is important to acknowledge the work of the Mental Health Commission over the years. I am sure that in the future it will function very well in the Health and Disability Commissioner’s office. The Alcohol Advisory Council will be independent. Its evidence-based advisory function is retained within the new health promotion entity, and alcohol harm reduction programmes will continue to be funded through a levy on alcohol consumption. As well as that, some of the $7.7 million of existing health promotion activity in the Ministry of Health will transfer to the new health promotion entity, and work is continuing on confirming the programmes to transfer and the appropriate transition of those programmes. Indeed, it is all good in terms of these three bills.

I want to finish off by just pointing out that in the commentary on the Crown Entities Reform Bill, in terms of the review of the Charities Act 2005, the strong view of Government members was that transferring the commission’s current functions to the Department of Internal Affairs will create a more robust, resilient agency, and they endorse the intention to do so now rather than after the review of the Charities Act. Fa‘afetai tele lava.

New Zealand Public Health and Disability Amendment Bill read a third time.

A party vote was called for on the question, That the Mental Health Commission Amendment Bill be now read a third time.

Ayes 103

New Zealand National 59; New Zealand Labour 34; New Zealand First 8; ACT New Zealand 1; United Future 1.

Noes 17

Green Party 14; Māori Party 2; Mana 1.

Bill read a third time.

A party vote was called for on the question, That the Charities Amendment Bill (No 2) be now read a third time.

Ayes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Noes 59

New Zealand Labour 34; Green Party 14; New Zealand First 8; Māori Party 2; Mana 1.

Bill read a third time.

Bills

Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill

Second Reading

Hon AMY ADAMS (Minister for the Environment): I move, That the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill be now read a second time. This bill responds to a regulatory gap that has meant New Zealand does not currently have a comprehensive regime in place to manage and mitigate the environmental effects of development activities in our oceans. New Zealand’s exclusive economic zone and continental shelf hold significant economic potential. The Government wants to unlock this economic potential in an environmentally responsible way. Environmental organisations and industries are agreed on the need for legislation to do this and most submitters supported the bill with amendments.

The bill as reported back reflects the Local Government and Environment Committee’s agreement on the majority of amendments proposed and its response to issues raised by a wide range of submitters. I wish to stress from the outset that this bill will not duplicate or extend existing legislation. The bill is not about oil spill response, mineral allocation, marine reserves, fishing, or shipping. These are all addressed under other existing legislation. Activities covered by the bill include seabed mining, the building of construction platforms for oil and gas exploration and drilling, marine farming, energy generation, carbon capture and storage, seismic surveying, and cable laying. The Environmental Protection Authority will make independent decisions on marine consent applications, balancing the environment and economy with input from the public and from iwi.

I would like to take this opportunity to thank the chair and members of the Local Government and Environment Committee for their work in considering this piece of legislation. I also greatly appreciate the in-depth knowledge and support to the committee provided by my officials in the Ministry for the Environment and the Environmental Protection Authority. My thanks also go to the submitters for the efforts and thought that went into their submissions.

This is a multifaceted piece of legislation, but the contributions made at the select committee have been vital in making it a more workable and high-quality piece of legislation. Altogether the select committee received 125 submissions, and a number of positive changes have been recommended for the bill, including clarification of what decision makers must consider, stronger recognition of the Treaty of Waitangi, wider reference to international obligations, increased enforcement powers, and more workable transition provisions. I would now like to take a moment to elaborate on these improvements in more detail.

So when read as a whole, the bill is clearly environmental legislation, and requires far more than a cost-benefit analysis. The select committee has recommended strengthening the requirements in the bill that outline the matters decision makers must take into account and to favour caution and environmental protection where information is unknown or uncertain. To do this, the committee has recommended structural changes to the bill and amendments to ensure that decision makers consider a range of relevant matters.

This is not about pitting the economy against the environment. It is about balance, and responsible management of our oceans. The select committee has recommended amending the reference to the Treaty of Waitangi in clause 14 to give effect to the principles of the Treaty of Waitangi through the listed provisions. This is a stronger requirement than the previous wording that the Treaty be taken into account. Let me be also clear that this bill fully complies with our international obligations. This has been confirmed by the Ministry of Foreign Affairs and Trade’s own legal team and confirmed by a number of legally qualified submissions to the select committee, including that from the New Zealand Law Society.

The international law of the sea gives New Zealand the right to explore and exploit marine resources in our exclusive economic zone and continental shelf, but it also provides the obligation to preserve and protect the environment. The point here is that the law of the sea must be looked at holistically. No single provision should be read in isolation. The juxtaposition of competing rights and obligations in the convention assumes that States will attempt to strike an appropriate and reasonable balance between interests before undertaking an activity. However, the bill also seeks to give effect to international obligations other than the law of the sea, such as the Convention on Biological Diversity. To clarify this intention, clause 11 of the bill has been amended to refer more generally to New Zealand’s international obligations in the marine environment.

The select committee has recommended that a wider range of enforcement tools be available to the public as well as to the Environmental Protection Authority. The committee has recommended that any person be able to apply to the Environment Court for an enforcement order to remedy or address any breach of the legislation. The committee has also recommended that the Environmental Protection Authority’s enforcement officers be able to issue abatement notices for minor breaches of the legislation. I commend these recommendations, and I do believe that they will achieve greater compliance with the proposed law.

Finally, in terms of substantive amendments, the committee has recommended new transitional provisions for the bill. Submitters made us aware that there may be some activities that will already have made significant investments prior to the bill coming into force that were not covered by the original transitional provisions. The Government is committed to making this legislation workable. The select committee’s recommended amendments will enable a smooth transition to the new regime. But to make sure that there are adequate environmental protections in place in the short term, the bill has also been amended to require an impact assessment be prepared by oil and gas companies during that transitional period. This will mirror the requirements once the legislation is in place, and, in fact, is part of best practice employed by most modern petroleum operators already. Once the transitional period has ended, all new activities will need to fully comply with the new regime.

I would like to conclude by addressing an issue that has been raised at the select committee, and repeatedly in the media. A number of people have asked why we do not just extend the Resource Management Act to include the exclusive economic zone and continental shelf. It is the Government’s view that the complexity and planning framework of the Resource Management Act would be overkill in our relatively uncrowded offshore marine environment. Furthermore, under the law of the sea, New Zealand does not enjoy the full sovereign rights that we have on land. It would be very difficult, therefore, to apply the Resource Management Act in light of the rights, duties, and responsibilities other countries have in our exclusive economic zone and continental shelf. It is our view that this bill provides an appropriate balance not only of environmental and economic interests but also of public participation and streamlined, cost-effective processes.

I am grateful to the submitters and the select committee, whose changes have served to further improve this long-overdue piece of legislation. This bill reflects the Government’s balanced approach to environmental management. It provides a strong and effective framework to ensure that processes are in place to assess and manage adverse environmental effects in our oceans, to provide greater certainty to investors and existing interests, to meet New Zealand’s international obligations, and to do this in the most efficient and effective way possible, without further delay. I am very pleased to commend the bill to the House.

GRANT ROBERTSON (Deputy Leader—Labour): Labour Party members want to say absolutely clearly that we believe that this is an area where legislation is indeed needed. New Zealanders rightly expect that we will have robust regulations, certainty, confidence about those who wish to work and use resources in the exclusive economic zone, and, for New Zealanders, confidence that the environment around them will be protected. Unfortunately, the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill fails to do those things. Labour Party members are very pleased that we voted against this bill—the only party to vote against this bill—on the first reading. We did that then because we believed the bill was too weak. It did not provide sufficient protections and enhancement for the environment, it did not meet our international obligations, it does not provide certainty, and it does not provide an inclusive process. Sadly, though the Local Government and Environment Committee has changed one or two things, none of those issues has been adequately addressed, and we remain consistently opposed to this bill.

Before I get into any more detail on the content of the bill and the concerns we have, I also want to thank the select committee and the officials for the work that they did. I particularly want to acknowledge, on our side of the House, Moana Mackey for the work that she has done on the committee.

Jacqui Dean: So why isn’t she speaking?

GRANT ROBERTSON: I have not been able to attend all of the meetings that I would like to, so Moana Mackey has done an excellent job in that regard, and will, as the bill goes on, I am sure, make a number of contributions. I wonder whether Jacqui Dean might make some contributions. Somehow I doubt that that is going to happen. But Moana Mackey is certainly somebody who was able to bring a rigour of analysis to this work during the committee, and I am very grateful to her and to other committee members for what they did.

The problems with this bill start first and foremost in the purpose clause, clause 10. Despite what the Minister for the Environment might like to think, what the purpose clause does in this bill is create the pitched battle between the economy and the environment that the National Party seems determined to see continue right across our society, right across our economy—that the environment and the economy are in a battle to the death. Of course, in the National Party’s picture, the environment must be defeated in the cause of the economy, not realising, of course, that in fact the only way that the economy can grow sustainably is by protecting and enhancing the environment.

That notion of the importance of the environment to enabling sustainable economic development is what is embedded in the international agreements around these issues—in particular, the UN Convention on the Law of the Sea. That is why people have been concerned throughout this process that this bill simply does not meet our international obligations. The Minister might like to just claim that it does, but, actually, submitter after submitter who came to the select committee told us that it did not. And these were not just any old people coming to a select committee with an axe to grind. These were people who work every day on these issues, who understand the legal ramifications of these issues.

Let us start with the Parliamentary Commissioner for the Environment, who actually came and managed to bring out the clause of the Convention on the Law of the Sea to make sure that we were absolutely aware of it. This is what the convention actually says: “States have the sovereign right to exploit their natural resources pursuant to their environmental policies and in accordance with their duty to protect and preserve the marine environment.” The parliamentary commissioner went on to say: “we can pursue economic development, but we must protect the environment. The former—economic development—is optional. The latter—environmental protection—is not.” That is the point of our international obligations.

To make it even clearer for the Minister, who seemed to think that legal experts around the country were agreeing that this bill was somehow magically now consistent with our international obligations, I refer her to the submission from the New Zealand Law Society to the select committee, which makes it absolutely clear. This is from the Law Society’s submission: “The right to develop resources within the EEZ and on the Continental Shelf (conferred under the LOSC and customary international law) is subject to obligations to protect and preserve the marine environment,”—subject to those obligations.

This is not a question of some imagined balance or some imagined battle between the economy and the environment. The conventions to which New Zealand has signed up—the conventions that govern how our marine environment actually operates and is used—say clearly that development of resources is subject to the obligations. That has been lost in this purpose clause. Without bringing that back in, this is not only inconsistent with our international obligations, it is also wrong. It is wrong because it does not bring into the law the expectations of New Zealanders that we will protect and preserve our marine environment.

We also have to make absolutely clear—and the Minister herself picked this up but drew the opposite conclusion from the Law Society—that the exclusive economic zone and the continental shelf are actually not part of New Zealand’s sovereign territory. We exercise our rights over them pursuant to the Convention on the Law of the Sea. So to put forward, as the Government has done, legislation that actually contradicts that Convention on the Law of the Sea makes this legislation wrong on all those fronts: wrong because it contradicts it, wrong because our right to be able to make this kind of law is actually pursuant to the Convention on the Law of the Sea, and wrong because we know that New Zealanders want to see us protect and preserve our marine environment—the very clause that comes out from the Convention on the Law of the Sea.

So the purpose clause of this bill is wrong. It needs to be changed. The Labour Party and, I am sure, other parties—the Green Party and New Zealand First—will be proposing amendments through this process in the Committee stage to ensure that we actually get a purpose clause that reflects our international obligations and actually reflects what New Zealanders want. New Zealanders have seen oil spills such as that in the Gulf of Mexico, they have seen the damage that can be done out in the exclusive economic zone, out beyond the 12-mile limit, and they want to see robust protections. They want to know that our environment will be protected if people are going to be using resources in the exclusive economic zone. This bill, through its purpose clause, completely fails to do that.

There are a huge number of other issues that I could deal with, but I do want to pick up the Minister’s comment around consistency with the Resource Management Act, and also to point out that once again during the select committee process, submitter after submitter came to us and said that we need more consistency with the Resource Management Act. The delineation between the 12-mile limit, inside which the Resource Management Act operates, and the 200-mile limit, in which this new legislation, which is not consistent with the Resource Management Act, will operate, is merely a line on a map. It is not actually a specific place; it is not a specific thing. We need to ensure consistency. Again, this is not just Opposition parties saying this. This was submitter after submitter from all sides of the debate—

Jacqui Dean: It’s not true.

GRANT ROBERTSON: —from the regional councils who came to us and said they want—Jacqui Dean says it is not true! The Taranaki Regional Council came to the committee and said it wants consistency on this. It was not just environmental groups; it was actually submitters across the board wanting to see this kind of consistency. That is in part because the concepts within the Resource Management Act have been tested. There is case law there. People understand what is meant by sustainable management. Under this process new concepts and untested concepts will find their way into the law, and that will be difficult for people to manage. Nobody is saying this will be exactly the same as the Resource Management Act, but it should be consistent with the Resource Management Act.

There are a range of other issues, and I am sure my colleague Moana Mackey will take up a number of them as we go on. I want to specifically, in this last couple of minutes, mention the question around Māori and the relationship with iwi. I think this was an area in which universally iwi came to the committee and said that they were extremely upset by the lack of consultation. That clause has now been amended, but I think it actually can be improved even more. But also I want to put on the record that the Labour Party will be proposing amendments to include specific recognition of Moriori. That was an issue raised with the committee. We believe that is appropriate, given the role of Moriori, particularly around the Chathams. So we will be proposing amendments in that regard.

This bill is flawed. We need quality legislation that provides a robust framework that New Zealanders can have confidence in when it comes to the management of our exclusive economic zone. New Zealanders want the confidence that we will protect and preserve the marine environment, as we are obliged to internationally, and as we should. We will be bringing up many, many amendments because this bill fails to give New Zealanders the confidence they should have, fails to give certainty to those who want to work in the exclusive economic zone, and fails to provide a process that people can participate in. This bill should have been significantly better than this. It should have given that certainty. We will work with the Government on good amendments to improve this, to make sure that we actually have a bill that is internationally consistent, that provides robust regulation, and that supports New Zealanders in their concern to uphold the environment. This bill does not do that, and we cannot support it at this stage.

NICKY WAGNER (National—Christchurch Central): Talofa lava, Mr Speaker. I rise to support this Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill, and I am delighted to support this bill. It has been long-awaited. I think we have been discussing this for probably near on 20 years. This bill is particularly significant because once it is passed, there will for the very first time be a framework for environmental protection in our exclusive economic zone.

As has been mentioned tonight already, the size of our exclusive economic zone in the marine environment is enormous. It is about 20 times the land mass of New Zealand, and our exclusive economic zone is the fifth largest in the world. I say “our” exclusive economic zone because under the United Nations Convention on the Law of the Sea we have sovereign rights over this area and the continental shelf. That sovereign right under the convention provides us with the opportunity to access the natural resources in this area, but it also makes the requirement for responsibility and obligation to conserve and preserve the natural environment. And this bill does just that.

It has been very interesting to hear the discussion from the Opposition members in the House, who are convinced that the bill does not meet our international obligations. However, we have had strong advice from the Ministry of Foreign Affairs and Trade. I note that the ministry actually negotiated this convention. It spent months and months for years negotiating this convention, and it believes that this bill meets our obligations.

But let me make this clear: this is only one bill. There are 14 other Acts that cover this area. This bill covers activities such as seabed mining, energy generation, carbon capture and storage, and marine farming, and also some aspects of petroleum exploration and extraction. But right now the most common use of the EEZ is in terms of shipping and fishing, and other Acts cover that. For example, the Maritime Transport Act 1994, which regulates shipping, also regulates marine pollution, oil-spill planning and response, and also dredging and the dumping of waste. In terms of fishing, the Fisheries Act 1996 manages both the fisheries and fishing activities. Other Acts such as the Crown Minerals Act 1991 and the Continental Shelf Act 1964 will continue to operate, and they will be involved in the resource-allocation regime for petroleum and minerals. There are also two other environmental Acts, the Marine Mammals Protection Act and the Wildlife Act. But what this Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill does, this long-awaited bill, is that it provides an environmental management framework similar to the Resource Management Act to assess, to manage, and to control activities in the EEZ.

There was an enormous amount of interest in this bill. That is no surprise. The Local Government and Environment Committee had 125 submissions and we heard 37. I have to say that every single submitter supported the bill and was pleased to see that it had come to the select committee. There was of course a variety of comments and shades of opinion about the detail of the bill, but every submitter was pleased to see that we had a bill that dealt with the environmental effects in the EEZ. There were an enormous number of important issues raised by submitters. We worked our way through those submissions, and numerous changes were agreed to by the whole committee, and they have been made to the bill. However, there were some differences of opinion that we could not reconcile, and that will make for great debate during the Committee stage.

I would like to thank everybody who was on the select committee, because regardless of our differences of opinion, we were all very aware of the importance of the bill and worked hard to get the best possible outcomes. I would also like to thank the officials from the Ministry for the Environment and from the Environmental Protection Authority. They worked very hard, they were well-informed, and they did good work for us. I also thank the drafters of the bill. It was a complex bill, it did require a lot of rethinking, and we appreciate the work that they did. I commend this bill to the House. It is time that we had legislation that provided the environmental framework that we need for our EEZ, and this bill will do the job. Thank you.

MOANA MACKEY (Labour): Talofa lava, Mr Speaker. I want to start by saying that I do not think that you would get any disagreement in this House that legislation monitoring and governing what happens in our exclusive economic zone and continental shelf is needed. What we on this side of the House are saying is that this bill, the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill, simply does not achieve the Government’s stated aims of allowing that economic activity to continue whilst protecting the environment in which it occurs. New Zealand has the fifth-largest exclusive economic zone and continental shelf in the world. The only reason that we have any right to, for example, exploit resources in that area is that we are signatories to the United Nations Convention on the Law of the Sea. But in signing that convention we also signed up to an obligation to put in place legislation that would allow any activity in that area to occur in an environmentally sustainable way.

I have to put on record our concern and disappointment that the Government has decided to charge ahead with the exploitation of mineral resources in our exclusive economic zone before this bill has even passed through the House. I think it shows a level of arrogance. It shows that the debating process in this House, the Committee stage that is coming up, and the select committee process is just a rubber-stamping exercise, because members opposite are so sure it is just going to get rubber-stamped by the parties that are supporting it. At the first reading it was more parties, and we are very happy now that the select committee process has highlighted the inadequacies of this piece of legislation, but now it is going to be rubber-stamped by ACT, rubber-stamped by United Future, and rubber-stamped by National, and, in fact, we are not going to have the proper debate that we need to have. All the while the Government is going out there and saying: “Please come in here, go into the exclusive economic zone, exploit those resources. We have got a voluntary regime in place.”

On the first reading of this bill, I put to the then Minister for the Environment, Nick Smith, the case on the East Coast, with Petrobras coming in and carrying out oil and gas exploration. He said to me: “No, we guarantee that nothing can ever happen until the bill is passed.” Well, that is actually not true. There is a voluntary regime in place that the Government is asking people to subscribe to, but if this bill does not meet our international obligations under the United Nations Convention on the Law of the Sea, then certainly a voluntary regime does not meet our international obligations. We think that perhaps the Government should just have waited until we had legislation in place before allowing those activities to go ahead.

The issue has been raised about whether or not this meets our international obligation, and clearly there is disagreement. It is not true that we were told by all submitters that it did meet our international obligation. We were astonished that the Government had not even bothered to get a legal opinion on this bill before it got to the select committee, and the reality is that we are never going to know until it is tested in the court. That is a reality. But we could have made certain that it met our international obligations by simply using the language that the convention uses. What the convention says is that it is not a balance between economic development and environmental protection. We have a right to exploit the resources in our exclusive economic zone, but that comes with an obligation—a duty—to ensure environmental protection. That is not a trade-off; that is a right with an obligation. Environmental protection is the bottom line.

The Parliamentary Commissioner for the Environment said in her submission: “we can pursue economic development, but we must protect the environment. The former—economic development—is optional. The latter—environmental protection—is not.” That is what the Parliamentary Commissioner for the Environment told the select committee.

Hon Steven Joyce: We don’t want jobs, eh? That would be terrible. No jobs. Don’t want the jobs.

MOANA MACKEY: Well, Minister Joyce can make fun of it. It will be great when the Government is in court defending this weak piece of legislation just because he would not put in a simple purpose clause that showed that we were consistent with the United Nations Convention on the Law of the Sea and that left absolutely no question as to whether or not we had met our international obligations.

Now I come to the issue of the regulations, because one of the other issues that was raised at the select committee was that so much of this has been done by regulation. This is a pattern we are seeing with this National Government, particularly on contentious pieces of legislation: put as much of it as possible into regulation as you can, and then it does not see the light of day at a select committee and it does not come to the House to be debated. Before me is the discussion document on the regulations on this legislation. As you can see, it is not insubstantial, and what submitters said to us was: “It’s really difficult for us to know how effective or ineffective this piece of legislation is going to be when we have not seen the regulations.” The regulations were released only after we heard submissions at the select committee, so they said: “Either keep the bill in select committee until we have had time to review the regulations and maybe come back to you with a supplementary submission—we do not have to be heard in person; it could be a written submission—or send the bill back to the committee once the regulations are released.” This is a discussion document, but we know how discussion documents go with the National Government. Basically it is: “This is what we are going to do. We are going to put it on our website and invite you to waste your time reading it and writing and telling us what you think, despite the fact that you know a lot more about it than we do. Then we are going to ignore everything”—

The ASSISTANT SPEAKER (H V Ross Robertson): Order!

MOANA MACKEY: I am sorry, Mr Speaker. Then they will ignore everything that those submitters say, and do exactly what they were going to do in the first place, which is implement it. So submitters know that these are the regulations that are going to ultimately be in place, and they would just like the opportunity to go back to the select committee, take account of the regulations alongside the legislation, and advise the committee and this House on what the overall impact of the bill is going to be. But obviously they were not given that opportunity, and, given how quickly the discussion document was released after the bill came back from the select committee, I do not think it would have been too difficult to have slowed down that process a little bit to allow that to happen. Clearly it was a deliberate attempt to not let that happen.

We have also talked a lot about the Resource Management Act. What National members try to make out is that Labour members say they should just extend the Resource Management Act. Well, that is not at all what we are saying. What we are saying is that the line that occurs at 12 miles is jurisdictional only. It is there only because within 12 miles that is our sovereign territory, and on the other side of 12 miles it is not. That is why the line is there. It has got nothing to do with science, it has got nothing to do with resource allocation, it has got nothing to do with the environment; it is jurisdictional. So why would you have a completely different regime in the exclusive economic zone compared with inshore?

Jacqui Dean: Because we don’t have sovereignty over the exclusive economic zone.

MOANA MACKEY: Jacqui Dean says it is because we do not have authority in the exclusive economic zone. Our shipping laws occur—

Jacqui Dean: No, no. Sovereignty.

MOANA MACKEY: Sovereignty in our exclusive economic zone. Then, Jacqui Dean, how can our coastal shipping laws occur in the exclusive economic zone? How can our health and safety laws work in the exclusive economic zone? How can our fisheries laws work in the exclusive economic zone? And how does the Biosecurity Act manage to operate in the exclusive economic zone? Apparently the only piece of legislation that is completely incapable of working in our exclusive economic zone is the Resource Management Act. So that is why we cannot have a bar of it. What a load of garbage!

One of the energy companies that came to speak to the committee said to us: “We support this, because it is going to be far more permissive than the Resource Management Act.” And that is the reality. Why would you create brand-new legal tests in the exclusive economic zone? Why would you not call on 20 years of Resource Management Act case law and put in place language and legal tests that are well tested, well understood, and that councils use now? The Taranaki Regional Council told us at the select committee that it would rather have tests and processes that it already knows. It has allowed oil and gas exploration to go ahead in Taranaki under the Resource Management Act; it has not stopped it. So why would you not use that, instead of inventing this new term “favour caution”? No one knows what that means. This bill is an absolute boon for lawyers. They are really the ones who are going to benefit out of this piece of legislation, because these are all untested—

Charles Chauvel: It’s not all bad, then.

MOANA MACKEY: Mr Chauvel says it is not all bad, then. It is untested and there is no reason to have two completely different regimes side by side, one far more permissive than the other, especially when you consider that some of these activities are actually going to cross that barrier. So they will go through a Resource Management Act process and a process to get a marine consent in the exclusive economic zone. Both those processes are completely different. With one you can appeal to the Environment Court; the other one you cannot—you can go only to the High Court on points of law. It is an absolute mess, and all because the Government wants to make it as easy as possible for this activity to go ahead without the environmental protections that the Resource Management Act has provided in our territorial waters. That is the reason: to make it more permissive.

Yet, arguably, the marine environment that we are talking about is far more dangerous than the exclusive economic zone. It is deeper. The Raukūmara Basin is 3,000 to 4,000 metres deep, where Petrobras is doing its exploration. The Gulf of Mexico is 1,400 metres deep. That is far more dangerous, far more risky, and, arguably, we should have legislation that is far more robust when we are deciding to let that activity go ahead.

Let us be clear. The concern with this legislation is around oil and gas exploration. There are a number of other activities, as members point out. At the Local Government and Environment Committee the chair kept saying that this was not about oil—this was not about oil. She kept saying to submitters: “Don’t talk about oil.” But if the activity does result in an oil spill, then it is about oil—it is about oil.

There are a number of things that Labour members will traverse through the Committee stage. For example, we are concerned about the provisions for penalties and cost recovery. There is actually nothing in this bill that, realistically, would require a company to have the money to be able to pay for the entirety of cost recovery, in terms of bonds or insurance. The penalties are incredibly weak. They are not going to be any kind of disincentive. The processes in the bill are massively stacked against people submitting on an application and are stacked in favour of those making the application. As I said before, being allowed to appeal only to the High Court on points of law instead of being able to appeal to the Environment Court raises natural justice issues, and this will actually clog the system up, rather than make it any easier.

Labour members would like to work with the Government to make this piece of legislation workable. We obviously want to see legislation in place. This bill does not do what the Government says that it is going to do, and it is crucial that we get it right.

GARETH HUGHES (Green): Kia ora, Mr Speaker. Talofa lava. I rise to take a call on the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill. The Green Party has long recognised the need for an environmental management regime for the oceans, and we support the intent of an EEZ bill, but we cannot support this weak, flawed, and overly permissive bill.

Chris Hipkins: I thought they voted in favour of it.

GARETH HUGHES: It is vitally important we get this right. The regime we establish is likely to remain in effect for years and, like with the Resource Management Act, we need a durable solution to provide certainty for business, for iwi, for communities, and for Kiwis.

New Zealand has got the fifth-largest EEZ zone in the world. It is internationally significant and it is an environment we know so little about. We New Zealanders love our oceans. They are where we fish, where we play, and where we get our spiritual sustenance from, and we take pleasure from the animals and the environment. It is an environment, though, where drillers hope to drill deep, deep, deep for oil; where Chatham Rock Phosphate wants to literally suck up kilometres of the sea floor to find phosphate. It is where other companies want to start mining the hydrothermal vents and methane hydrates.

As, I think, the member Chris Hipkins was interjecting there, it is true that the Green Party supported the bill in its first reading, because we support the intent of EEZ legislation. We have been calling for it for 12 years. It is good to finally have it. We tried to make the bill better in the select committee. We supported the numerous submitters who supported, like us, the intent of the bill, but not the bill as it was drafted and not the bill that we have seen come back from the select committee. Ultimately, our economy depends on our environment, and this bill is all about—it is all about—facilitating activities like risky deep-sea drilling to occur. This bill is called the “EEZ Bill”, but really it should be called the “Eee-zee Drilling Bill” because that is what this bill is facilitating.

There are numerous reasons why the Green Party is opposed to the bill. There is the fact that it fails our international obligations; it prioritises economic development over those environmental considerations; it fails to take into account climate change, full stop; it contributes to uncertainty around the drafting, along with the precautionary approach; it fails to meet our Treaty of Waitangi obligations; it fails the principles of natural justice; it contains woefully inadequate penalties, meaning that the taxpayer is going to have to pick up the tab when there is an accident; and it simply ignores marine protection.

Before I go on to the bill I would like to thank the submitters and the officials who worked on the bill, and I would like to acknowledge the chair of the Local Government and Environment Committee, Nicky Wagner. But I have got to lament the select committee process. Here we saw the six National members almost uniformly vote against any amendment put forward by an environmentalist, a legal expert, or the Green Party, yet when you look on the other side at all the amendments supported by industry, it was tick, tick, tick. It was an absolutely biased process. And they call it a balance, which is the most shocking irony of the whole process.

As we saw, there was a split vote on the select committee among the six National members, the three Labour members, the two Green members, and the one New Zealand First member. We saw the bill reported back from the committee and not supported by the committee. All the amendments the Government wanted to put forward simply could not go through because of that split vote. So I acknowledge everyone who engaged, but I would like to point out that it was a deeply flawed process. We have not seen a better bill come out of the select committee as a result.

The first critique of the bill is the bill’s weighting in favour of economic development over environmental responsibility to protect and preserve. The bill makes deep-sea drilling almost certain to be approved—I have not heard any member from National say anything to the contrary—and this brings with it the spectre of a catastrophic oil spill. It is not academic any more for New Zealanders, because, as we have seen after the Rena, oil on beaches is something Kiwis have tasted, they have smelt it, they have seen it, and they have touched it.

The Government, in a very surprising move, is currently consulting on the regulations for this bill, which is at only its second reading now. The Government is consulting on a bill that has not even reached the Committee stage. What the Government is proposing to do is make risky deep-sea drilling a discretionary activity.

But I have to point out that no rules, no amount of consultation, and no amount of Government legislation are ever going to plug a deep-sea well blowout and the corresponding catastrophic oil spill. The only way we can protect our waters, our tourism, our aquaculture industries, and our beaches is to make risky deep-sea drilling a prohibited activity. As the petroleum lobby group in New Zealand says, the only thing we can do when facing an oil spill is focus on beach clean-ups. This legislation is not going to stop a spill; in fact, it is going to make it more likely, as it simply makes deep-sea drilling “eee-zee”.

The Minister, I think, pointed to our international obligations incorrectly. Numerous submitters—I would say the majority—including the Parliamentary Commissioner for the Environment, said the bill is not consistent with our international obligations under the United Nations Convention on the Law of the Sea. The only reason we get to use our EEZ and continental shelf is the United Nations Convention on the Law of the Sea. With that right comes the responsibility to “protect and preserve”—those three key words—our marine environment. The drafting changes made at the select committee in fact make the bill weaker. We need to be explicit. If the Government wants to be consistent with the United Nations Convention on the Law of the Sea, then let us say it. Let us say: “This bill is consistent with our obligations under the United Nations Convention on the Law of the Sea.” If that is the fact, the Government should not be scared of putting it into the legislation.

The key clause in the bill is clause 10, which sets out the purpose of the bill. The bill tries to enshrine this National ideological fixation with balance, which is the whole idea that you can balance a bit of environmental degradation against a little bit of economic development. For us it is a false dichotomy. A healthy economy relies on a healthy environment. It is that simple. The bill fails to acknowledge entirely there are any environmental limits or that there are any environmental bottom lines. As Simon Terry points out, the bill is a bit like a jellyfish. It is a bill that has got no spine. There is no bottom line.

A key couple of phrases in the drafting of the bill is that decision makers are required only to “take into account” matters such as the protection of biological diversity and the integrity of marine species, ecosystems, and processes. They are not required, as they under the Resource Management Act, to “recognise and provide”. These are key drafting terms, because to “recognise and provide” is a lot stronger than to simply “take into account”, as the National Government would have the Environmental Protection Authority board do when it is considering its applications. The bill essentially leaves all the key decisions up to the board. This is the board nominated by the National Government, and I have no confidence in a National Government - stacked board to make the right decision when it comes to our precious marine environment.

In an astounding move we are seeing that perhaps the most dangerous part of the bill is the complete failure to take climate change into account. In fact, the bill specifically prevents the Environmental Protection Authority board from considering the effects of discharging greenhouse gases. Here we have got the most pressing environmental issue in the world facing us, but this Government wants to drill more than 3 kilometres deep, dig up literally thousands of tonnes of oil, and the Government does not want to take into account greenhouse gases. It is the most short-sighted and dangerous part of this bill. It shows that this Government has got its head in the sand over climate change.

As we saw in the estimates in the Finance and Expenditure Committee, which this Government should be absolutely embarrassed about, the emissions trading scheme costs, under the estimates today, $1.5 billion—$1.5 billion is the annual cost of the emissions trading scheme recently revealed by this Government. It is a shame. It is a tragedy. This bill, as it is drafted, treats it as if the planet just did not matter.

I am going to quickly race through for my last 2 minutes. We see the precautionary approach replaced with this novel term, just plucked out of nowhere: the “favour caution” language used in the bill. It will simply lead to increased uncertainty. It will be a feeding frenzy for lawyers, as we ditch the internationally understood and case-law developed precautionary principle.

We saw some changes to the Treaty of Waitangi clause. We did not go far enough to commit to the Treaty.

The bill ignores natural justice. There is no ability to—

The ASSISTANT SPEAKER (H V Ross Robertson): I am sorry to interrupt the honourable member. The time has come for me to leave the Chair.

Debate interrupted.

The House adjourned at 10 p.m.