Tuesday, 15 October 2013

Tuesday, 15 October 2013

Tuesday, 15 October 2013

Mr Speaker took the Chair at 2 p.m.

Prayers.

Questions for Oral Answer

Questions to Ministers

Regional Economies—Development

1. Hon DAVID CUNLIFFE (Leader of the Opposition) to the Prime Minister: Does he stand by his statement that “One of the risks for us is that there’s heavily pronounced economic development in Auckland, but not in the rest of the country”?

Rt Hon JOHN KEY (Prime Minister): Yes, that is always a risk, but it is not what I am seeing across the country.

Hon David Cunliffe: How does the Prime Minister explain the widening gap between Auckland and the rest of the country when most regions have seen a decrease in weekly incomes since 2008?

Rt Hon JOHN KEY: I do not believe that to be correct. If one looks at real after-tax median income and compares it between 2006 and 2013, it has gone up 11.8 percent in Auckland. I note that it has gone up 14.4 percent in Taranaki, where apparently everybody is leaving—well, that is what they told David, anyway. In Manawatū-Wanganui it has gone up 13.6 percent, in Northland it is 17.7 percent, and in Canterbury it is 14.1 percent. It would appear that the statement made by the Leader of the Opposition is one that he has just made up.

Hon David Cunliffe: Why has annual population growth in the regions halved under National from 0.9 percent under Labour to just 0.5 percent?

Rt Hon JOHN KEY: I really am truly shocked that the Leader of the Opposition would ask that question, after yesterday saying that people in the regions have been left “with no choice but to leave in droves.” In answering that question, let us go to the census data—

Hon Steven Joyce: Released today.

Rt Hon JOHN KEY: —released today. Lo and behold, 15 of the 16 regions have gone up in population. In Taranaki, they have not actually left in droves; they have gone in in droves, probably because of the oil and gas industry and the rural sector there. It has gone up by 5.3 percent. I say this: under a National Government, yes, those people will get support for what they want to do. What those people will not get is—guess what? They will not get the living wage under David Cunliffe in Taranaki, because he wants to pay it to people in Wellington.

Grant Robertson: I raise a point of order, Mr Speaker. I noticed a couple of times there towards the end of the Prime Minister’s answer that you made as if to stand in order to sit him down. That answer was both long and largely irrelevant.

Mr SPEAKER: That might well be the opinion of the member. I thought the question was adequately addressed.

Hon David Cunliffe: How many of the 200,000 New Zealanders who have permanently left for Australia, seeking that brighter future under his watch, have left from our regions?

Rt Hon JOHN KEY: I do not have the exact number, but I know this much: 625,000—

Grant Robertson: I raise a point of order, Mr Speaker. The Prime Minister made it clear that he did not have the information to answer that question. Anything else he says—

Mr SPEAKER: Order! [Interruption] Order! The member will resume his seat. I will determine when the Prime Minister has finished his answer.

Rt Hon JOHN KEY: I do know that under a Labour Government, 625,000 people left for Australia; I do know that in the last year of the last Labour Government, 35,000 people left; and I know that those numbers are falling to 27,000—

Mr SPEAKER: Order!

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. Your answer to Mr Robertson was that you determine when the Prime Minister has finished answering the question. Around about when were you going to do that, given that those last two sentences from the Prime Minister related to another administration and not his?

Mr SPEAKER: Order! I give the same answer to the honourable member. I will determine when the question is answered when I am ready to do so.

Grant Robertson: I raise a point of order, Mr Speaker. In light of that ruling, can I seek some clarification then on what criteria you were judging that the Prime Minister’s answer remained relevant? He was addressing material that he is not responsible for.

Mr SPEAKER: Order! I will be determining when I decide the answer is sufficient. I will not hesitate, if I have reached that point, to ask whoever is answering the question to sit down.

Hon David Cunliffe: What does the Prime Minister intend doing, if anything, about the potential loss of up to 200 people’s jobs at Independent Fisheries in Christchurch?

Rt Hon JOHN KEY: Well, I have not looked at the matter in relation to Independent Fisheries specifically—specifically, I have not done that. But what I can say is that Independent Fisheries is based in Christchurch. Christchurch is one of the Government’s top priorities. Christchurch has a 6.6 percent growth rate. Christchurch has $40 billion worth of investments going into it. This is what is really interesting, because when this Government stood up for 3,200 jobs in Southland, those people said to do nothing. This Government did something—

Mr SPEAKER: Order! That answer is sufficient.

Louise Upston: Has he received any reports on income growth in New Zealand’s regions?

Rt Hon JOHN KEY: Yes. I received a report saying that real median weekly incomes had dropped in some regions since 2006, including a drop of $45 a week in Southland. Then I received another report using official information from Statistics New Zealand showing that the real median weekly income had in fact grown in all regions of New Zealand by an average of 6 percent, and in Southland the real median weekly income had grown by $53 a week before tax and $76 a week when you take our tax cuts into account. So I wonder which one to believe: the Government Statistician or David Cunliffe? I am going with the Government Statistician.

Hon David Cunliffe: What will the Prime Minister say to the up to 90 scientists losing their jobs at Invermay Agricultural Centre near Dunedin or to the people of Dunedin who have already lost the jobs—closed down on his watch—at Hillside railway workshops?

Rt Hon JOHN KEY: The first thing I would say to them is that the consultation process is ongoing, so that has not been completed. But, you see, when I go to Palmerston North—if a decision is made about what is happening at Invermay Agricultural Centre and those people are relocated to Lincoln or Palmerston North—and that is a seat, by the way, held by Labour, I will be saying that those people are coming to the regions from that area. You see, if I went to a Council of Trade Union’s speech, I would say the same thing to the media—

Mr SPEAKER: Order! That answer was long enough.

Grant Robertson: I raise a point of order, Mr Speaker. Throughout the Prime Minister’s answers today, in almost every answer, he has gone into material that either he is not responsible for or is not relevant to the question. I ask you to hold him—

Mr SPEAKER: Order! [Interruption] Order! I invite the member to consider the question that was asked and then the content of the answer. It was about 90 scientists who may lose their jobs at Invermay Agricultural Centre. The Prime Minister talked about consultation ongoing, and then talked about a visit to Palmerston North, and at that stage I rose to my feet. If the member is going to continue to interject, I will have no hesitation in asking Grant Robertson to be leaving the House.

Government Financial Position—Reports, Solid Energy, and Return to Surplus

2. Hon KATE WILKINSON (National—Waimakariri) to the Minister of Finance: What reports has he received on the Government’s financial position and especially progress in meeting its target of returning to surplus by 2014/15?

Hon BILL ENGLISH (Minister of Finance): Treasury last week published the Government’s Financial Statements for the year ended 30 June 2013. They showed higher tax revenue and lower than forecast Crown expenses that helped to more than halve the Government’s operating deficit before gains and losses to $4.4 billion for that year. This compares with a $9.2 billion deficit the previous year and was considerably better than the deficit forecast in Budget 2012 of $7.9 billion, so it was $3.5 billion better than forecast in the last Budget. This confirms that the Government’s careful approach to fiscal management is working and that our focus on getting better results for the community is flowing through to better results for the Government’s books. Fortunately, we did not listen to all the advice from the Opposition about how to do this.

Mr SPEAKER: Order!

Hon Kate Wilkinson: What has been the Government’s approach to stemming previously unsustainable growth in Government spending, and how was this reflected in the latest annual Financial Statements?

Hon BILL ENGLISH: The Government has taken a balanced approach, which has been to focus on the longer-term drivers of Government expenditure. Those longer-term drivers are often social failures—that is, the incidence of crime, welfare dependence, and lack of educational achievement. In each case, the Government is focusing on improving those results for the community, and that is flowing through to the Government’s books. So in the latest year, core Crown expenses came in at $70.3 billion, about $3.4 billion below what was expected in last year’s Budget. Part of this result was lower than forecast costs in Canterbury and part of it was lower expenditure by Government departments. We remain on track to reduce Government expenditure as a proportion of GDP to 30 percent by 2016-17, down from 35 percent of GDP in 2010-11.

Hon Clayton Cosgrove: In respect of the Government’s financial position, does he stand by his statement regarding the bailout of Solid Energy that “As far as we’re concerned we’ve got a deal.”, and how does he reconcile that statement with the news that the Bank of Tokyo-Mitsubishi UFJ is taking legal action to block the Solid Energy bailout?

Hon BILL ENGLISH: I do stand by the statement. Both the auditors and the directors of the company, according to company law, had to ensure the solvency of that company by 30 September. The Government has negotiated a deal with the banks that creates that position. The fact that the Bank of Tokyo-Mitsubishi UFJ wants to take some legal action to prevent it being compelled to join the deal is really a matter for the bank. Our best advice is the bank has a very small chance of success. The irony is that if it succeeded in that legal action, the company may go into liquidation with the loss of a thousand jobs, and the bank would lose all its money. It may wish to consider that.

Hon Kate Wilkinson: Why is it important that the Government sticks to its successful economic and fiscal plan and continues to focus on returning to surplus?

Hon BILL ENGLISH: There are a number of reasons. One is that the New Zealand Government will continue to incur more debt until we actually get to surplus. At the moment Government net borrowing is still $110 million per week, down from a peak of $260 million per week in 2010-11. The second reason is that the Government has an objective of doing as much as it can to keep interest rates lower for longer, and a strong fiscal plan is likely to achieve that. Thirdly, the fiscal results are secondary to the task the Government has set itself, which is to get better results from Government expenditure for the community. When we rehabilitate prisoners effectively, when we teach children how to read, when we keep young people in school and out of offending, we save a lot of money, and that is starting to work.

Hon Kate Wilkinson: What will be the Government’s main areas of focus after it reaches a Budget surplus in 2014-15?

Hon BILL ENGLISH: Budget 2014 will confirm or otherwise whether we get to surplus, although it does look pretty likely. We then want to reduce net debt to a prudent 20 percent of GDP by 2020. One has only to observe international events such as the potential threat of the failure to resolve the debt ceiling argument in the US to understand that the international financial markets in which we still borrow billions and on which we are dependent for sourcing a lot of our investment capital could be volatile and uncertain for New Zealand, so we need a prudent level of debt. The Government will also have other choices, such as resuming contributions to the New Zealand Superannuation Fund or investing further in public services that achieve results for the community.

Electricity Market—Performance, Prices, and Sales of State-owned Assets

3. METIRIA TUREI (Co-Leader—Green) to the Prime Minister: Does he stand by his statement that Mighty River Power’s buy back of $50 million worth of shares is “highly normal”?

Rt Hon JOHN KEY (Prime Minister): Yes. Air New Zealand, for example, started a share buy-back programme last year and is planning to purchase up to $45 million of its shares. Infratil is planning a $65 million share buy-back. Telecom did a $200 million share buy-back last year. Comvita did a buy-back last year. This is normal business practice and the decision is made by the board in the interests of the company and its shareholders.

Metiria Turei: If Mighty River Power is charging so much for power that it has $50 million lying around and nothing better to do with it than buy back shares, what action has the Government taken, as the majority shareholder in the company, to ensure it reduces electricity prices for families and for businesses?

Rt Hon JOHN KEY: We have a very competitive electricity market in New Zealand. People are free to choose. The member is making a huge mistake in showing her complete lack of knowledge of financial markets if she wants to conflate pricing with the capital structure of the company.

Metiria Turei: When power consumption in New Zealand is falling but electricity prices are rising at four times the rate of inflation, such that electricity companies are using the surplus cash to buy back their own shares, does he honestly believe that the electricity sector is working for New Zealand families and businesses?

Rt Hon JOHN KEY: Yes. I think we have a competitive electricity sector. I say this to the member: it will be interesting to see when she goes knocking door to door to tell the least well off families in New Zealand how much they are going to enjoy paying $500 a year for her emissions trading scheme.

Metiria Turei: Can the Prime Minister confirm—[Interruption]

Mr SPEAKER: Order! I have called Metiria Turei, if she wants to continue with her supplementary question.

Metiria Turei: Can the Prime Minister confirm that the Government, as the majority shareholder in Mighty River Power, prefers that it distributes $50 million in extra profits to shareholders in a share buy-back, rather than lowering its electricity prices by $50 million for families and for businesses?

Rt Hon JOHN KEY: Whether the company engages in a share buy-back is a matter for the board.

Metiria Turei: When the Prime Minister said that he had a mandate for asset sales, did he mean he had a mandate to sell strategic public infrastructure to a handful of wealthy investors and institutions, who would then get to pocket the excessive profits?

Rt Hon JOHN KEY: To start off, in the case of Mighty River Power, it is one of the most widely held shares in New Zealand. Secondly, at the last election the National Party had over 1 million people who voted for it. To quote the then leader of the Labour Party—and I know you have to go back a few now, but that was Phil Goff—he said that asset sales were a referendum on the election. When about 90-plus percent of New Zealanders were opposed to smacking, the Green Party said, well, there should not be referendum and they should just ignore it.

Metiria Turei: If the Prime Minister believes he has got it right and asset sales have been a success for New Zealand, why will he not test that mandate by suspending the sales until after the referendum is held?

Rt Hon JOHN KEY: Because in the 2011 general election virtually the entire election campaign was about the mixed-ownership model. National received the highest party vote in our party’s history under MMP. Labour—well, they got buried.

Mr SPEAKER: Order! The Prime Minister has adequately addressed that question. [Interruption] I have finished with the answer, thank you very much.

Education, Minister—Responsibilities

4. CHRIS HIPKINS (Labour—Rimutaka) to the Minister of Education: Is she satisfied that she is fulfilling all of her legal obligations under the Education Act 1989; if so, why?

Hon HEKIA PARATA (Minister of Education): Yes, because I am working hard to raise achievement for five out of five kids.

Chris Hipkins: Did she ensure that all available information informing her proposal to merge Phillipstown School and Woolston School was provided to the schools when the consultation period required under the Education Act began; if not, why not?

Hon HEKIA PARATA: As this judgment is still within the appeal period and one or other of the parties may appeal, it would not be in the public interest for me to comment.

Chris Hipkins: I raise a point of order, Mr Speaker.

Mr SPEAKER: Order! This is a point of order and it will be heard in silence.

Chris Hipkins: I did not ask in any way about the case that is before the court or the court’s judgment. I asked her about a consultation process under the Education Act that she initiated and whether she felt she had—

Mr SPEAKER: Order! I thought in the question the member asked he referred to two schools, being Phillipstown School—

Chris Hipkins: Yes.

Mr SPEAKER: Well then, that is the crux of the court case, so the Minister’s answer was quite in order.

Chris Hipkins: I raise a point of order, Mr Speaker.

Mr SPEAKER: Can I just clarify—you are not in any way questioning the ruling I have just given?

Chris Hipkins: No, no. It is some clarification.

Mr SPEAKER: Let us hear the fresh point of order.

Chris Hipkins: The clarification is that I did not ask her to comment on the court’s ruling. I asked her about decisions that she had taken. I am not asking her to say whether she agrees with the court. I am asking her whether she is satisfied with the decisions that she made even prior to the court considering the matter.

Mr SPEAKER: And I accept that the member is now raising exactly the same point of order again. The Minister said that because it was involving those two schools, and that is the court case, the Minister, because it is still within an appeal time, does not feel it is within the public interest for her to answer further. That is a satisfactory answer for the Minister to give.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. The Minister may or may not appeal this court case, but the matter is not sub judice at all until she does. That is the legal point, and the Speaker should have regard to it.

Mr SPEAKER: Order! I do not need assistance on that particular point. The Minister did not say it was sub judice. What she is saying is that there is a possibility of appeals by either party, and on that basis she does not feel it is in the public interest to further answer. That is a legitimate answer for the Minister to give.

Chris Hipkins: Were all of the schools proposed for merger or closure in Christchurch provided with detailed information on the likely cost of her proposals, as against the retention of the status quo, during the formal consultation period required under the Education Act; if not, why not?

Hon HEKIA PARATA: As the matters the member is inquiring about are contained by the judgment and it is still within the appeal period, one or other of the parties may appeal, and it would not be in the public interest for me to comment.

Chris Hipkins: I raise a point of order, Mr Speaker. There were several dozen schools in Christchurch that were proposed for closure or merger. The court case that we have dealt with relates to only two. My question related to all of those schools. If the Minister does not want to address the issue that may possibly be subject to a court case, she could still address the rest of the schools proposed.

Hon Gerry Brownlee: This is a serious matter. It does involve the rights of a community to question decisions around this sort of activity. It is also the right of the Minister to determine what is in the public interest when it comes to answering these things. There should not be anything said in this House that might prejudice either position. That is the position the Minister has taken, and that is perfectly reasonable in the circumstances.

Mr SPEAKER: I will hear from Grant Robertson.

Grant Robertson: The question that my colleague asked was not one that actually engaged at all with the proceedings before the court. He asked a question about facts, seeking facts from the Minister. The question did not ask for an opinion; it actually just asked her about a broader set. I wonder whether you could get my colleague to re-ask the question and we might be able to take the matter forward from there.

Mr SPEAKER: In regard to the very first supplementary question, I have no doubt that my decision was absolutely right. I accept the point that Chris Hipkins is making. This one was more general. At the end of the day, I am not going to be responsible for the answer that the Minister gives. She has said it is not in the public interest to answer it—on a number of schools in Christchurch—which, frankly, I find a surprising answer, but that is the answer given. I think the best way forward is that I will allow the member an additional supplementary question for him to use.

Chris Hipkins: Were all of the schools proposed for merger or closure in Christchurch, other than Phillipstown School and Woolston School, provided with detailed information on the likely cost of her proposals, as against retention of the status quo, during the formal consultation period required under the Education Act; if not, why not?

Hon HEKIA PARATA: As the question relates to issues dealt with by the judgment, which is still—

Hon Annette King: No, it does not.

Hon HEKIA PARATA: Yes, yes, they are. It is still within the appeal period, and one or other—[Interruption]

Mr SPEAKER: Order! I am having trouble actually hearing the answer. Can the Minister please repeat it?

Hon HEKIA PARATA: As one or other of the parties may appeal, it would not be in the public interest for me to comment.

Chris Hipkins: I raise a point of order, Mr Speaker. My question specifically excluded the schools that have taken court action against the Minister’s decision. It is not unreasonable to ask her to answer for her actions, as required under the Education Act, in relation to a matter that is not before the courts, that has not been put before the courts, and, as far as I know, that no one is going to put before the courts.

Mr SPEAKER: To move the matter—[Interruption] Order! To move the matter forward, I am going to ask the member to ask the question again. I would hope that an informative answer could be given to the House.

Chris Hipkins: Were all of the schools proposed for closure or merger in Christchurch, other than Phillipstown School and Woolston School, provided with detailed information on the likely cost of her proposals, as against retention of the status quo, during the formal consultation period required under the Education Act; if not, why not?

Hon HEKIA PARATA: As the matters the member inquires about are relevant to the judgment, which is still within the appeal period, and one or other of the parties may appeal, it would not be in the public interest for me to comment.

Grant Robertson: I raise a point of order, Mr Speaker. I presume that the Minister is using Standing Order 383(1), in order to say that the answer she is giving cannot be given consistently with the public interest. We are faced with an enormous difficulty on this side of the House if Ministers are simply going to invoke that, no matter what question is asked. I know that you have taken the attitude that you have given the member an additional question in the hope that the Minister will answer. I do not find it acceptable under the Standing Orders that you will now potentially move on from that. The Minister is obliged to give an answer that addresses the question. She cannot simply invoke the public interest randomly. It has to actually relate to a specific case. This does not.

Mr SPEAKER: I thank the member for his point. I can only ask the Minister, in answering the question, to be informative to the House. At the end of the question, it is over to the Minister to decide how she answers the question. If she decides to invoke the public interest, then that is where the matter lies. I cannot insist on a particular answer from a Minister. I would have hoped that the answer would be more informative.

Grant Robertson: I raise a point of order, Mr Speaker. Although you cannot insist on a particular answer, it is your job under Standing Order 383 to ensure that the Minister addresses the question. Nobody is asking for a specific, particular answer. My colleague asked the question, which could be addressed in the public interest. He excluded the matters that you were concerned about earlier. It is your job to require a Minister to address a question. The Minister has failed to do that.

Hon Gerry Brownlee: The member’s question was a clever way of getting in exactly the same position and trying to put the Minister in a difficult position. [Interruption] Look, yes, he is one of your more talented members—no doubt about that. However, if you go to Speakers’ rulings 172/5 right through to Speakers’ ruling 173/5, there are all of the rulings that the House has in front of it with regard to questions and answers, and it is very clear that the Minister has to make a decision about what is in the public interest. A Minister who is potentially engaged in further court action will often decide that it would not be fair to either party to progress the answer being sought by the Opposition.

Mr SPEAKER: I thank the member. If I could refer back to Grant Robertson’s point where he correctly pointed out that it is my job to see that the Minister addresses the question, in my opinion the Minister has addressed the question, but certainly not to the satisfaction of the member asking the question nor, indeed, to Grant Robertson’s satisfaction. [Interruption] Order! The member has invoked an answer that says it is not in the public interest to answer it. I do not find that at all helpful to the House or informative, but the Minister has addressed the question. I invite Chris Hipkins to continue his line of questioning.

Chris Hipkins: Is she satisfied that all of the schools in Christchurch on which she has made decisions to close or merge as a result of the formal consultation period, other than Phillipstown School and Woolston School, were provided with all of the information they needed to have a meaningful say in the consultation process?

Hon HEKIA PARATA: As consultation was the subject of this judgment, which is still within the appeal period, and one or other of the parties may appeal, it would not be in the public interest for me to comment.

Hon Nanaia Mahuta: Given her responsibility under the Education Act, is she satisfied that all the reporting obligations of Te Kōhanga Reo National Trust and any subsidiary entity have been met?

Hon HEKIA PARATA: No.

Hon Nanaia Mahuta: Subsequent to that answer, has she received any advice from ministry officials or her advisers regarding inappropriate spending associated with Te Kōhanga Reo National Trust; if so, what action will she take?

Hon HEKIA PARATA: No, but notwithstanding that, the action I have taken is to call an urgent meeting of the national trust, which will be held this evening.

Hon Nanaia Mahuta: Have any matters been brought to her attention regarding Te Pātaka Ōhanga requiring her to investigate the use of public moneys intended to achieve Māori language learning outcomes?

Hon HEKIA PARATA: I am aware of the allegations in respect of Te Pātaka Ōhanga. That is one of the reasons why I have requested an urgent meeting, and it will be held this evening.

Rt Hon Winston Peters: When the Minister in answer to so many supplementary questions replied that it was not in the public interest, on what basis to do with the Standing Orders, constitutionally, or legally was she making that statement?

Hon HEKIA PARATA: I was making it constitutionally, so that we would not breach the separation of powers between the judiciary and Parliament, and I was making it legally on the advice that—

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. No separation of power matters arise here—

Mr SPEAKER: Order! [Interruption] Order!

Rt Hon Winston Peters: I’m making my point of order—

Mr SPEAKER: Order! I do not need to hear it from the member. Will he please resume his seat. The member asked on what basis the Minister was giving those answers. The Minister gave a perfectly adequate answer to that.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. The Minister is required to be terse and to the point, and the point had to be in respect of the three issues put to her. If there is no court case pending or even contemplated, to the best of my knowledge, how could she possibly answer the question that way?

Mr SPEAKER: By opening her mouth and giving the answer that she did.

Chris Hipkins: Does she stand by all of her school closure and merger decisions in Christchurch other than her decision to merge Phillipstown School and Woolston School; if not, why not?

Hon HEKIA PARATA: Yes.

Chris Hipkins: I raise a point of order, Mr Speaker. [Interruption]

Mr SPEAKER: Order! It is a point of order.

Chris Hipkins: If the Minister is able to answer that she stands by her decisions, why is she not able to answer questions on the reasons for that, on which all my earlier questions were?

Mr SPEAKER: Order! The member has now been given an answer that he is satisfied with this time, and he is then going back and questioning earlier answers that the Minister gave. We have moved past that. I agreed with the member—I thought those answers were less than helpful to the House. They are the answers that have been given.

International Education—Revenue, Promotion, and Regulation

5. NICKY WAGNER (National—Christchurch Central) to the Minister for Tertiary Education, Skills and Employment: What recent reports has he received on the value of the international education industry to New Zealand?

Hon STEVEN JOYCE (Minister for Tertiary Education, Skills and Employment): I recently received a new report by Infometrics on the economic impact of international education in 2012-13. This report shows that the value of international education to the New Zealand economy is continuing to grow. It contributed $2.6 billion in 2012-13 and around 28,000 jobs. The sector has grown in value since 2008, despite a recent fall in international student head count due to the impacts of the global financial crisis and the Christchurch earthquakes. It is worth noting that international education is important not just for New Zealand as a whole but also for our regions—for example, in 2012-13 spending generated $177 million for Wellington, $165 million for Otago, and $152 million for Waikato.

Nicky Wagner: What steps is the Government taking to encourage growth in New Zealand’s international education sector?

Hon STEVEN JOYCE: Last week the Minister of Immigration and I announced a package of new initiatives designed to help grow our international education industry further. The changes will make it easier for some international students to work during their studies, and allow streamlined visa processing in partnership with selected high-quality education providers. Furthermore, the lowest-quality providers will be prevented from enrolling international students. Together, these changes will help ensure that New Zealand remains internationally competitive and provides a good quality experience for students in New Zealand. Growing international education is not just about direct revenue; it is about creating relationships with countries that are vital for New Zealand’s future. International students who study here often go home to their home country and become great ambassadors for New Zealand, and maintain their links with this country.

Nicky Wagner: How will the changes enhance protection for international students in New Zealand?

Hon STEVEN JOYCE: It is important that we do look after international students, who travel a long way to come and study here. In addition to the legislative changes made previously in 2011, the Government is proposing further amendments to establish a new legal framework for enforcing the Code of Practice for the Pastoral Care of International Students, as well as a new disputes resolution scheme to resolve contract disputes. We need to remain vigilant to the risks of unscrupulous agents and providers. Although we are already making a number of legislative changes to deal with bad apples in the system, these changes will further strengthen our regulatory framework so that we keep looking after this very important industry for New Zealand and for the students who study here.

Housing, Minister—State Housing, Affordable Housing, and First-home Buyers

6. PHIL TWYFORD (Labour—Te Atatū) to the Minister of Housing: When he carried furniture into a Housing New Zealand tenant’s house, was he consciously comparing himself to Michael Joseph Savage?

Hon Dr NICK SMITH (Minister of Housing): No, I leave such grandiose comparisons to the Leader of the Opposition. But it was a very useful opportunity to highlight our social housing policy of expanding 3-bedroom houses from that era to make them suitable for larger families through Budget 2013’s Project 324&5—our programme of insulating every possible State house to make them warmer and safer—and the priority that we are now giving to families on the waiting list with a risk of rheumatic fever, through changes to the social allocation system.

Phil Twyford: How does his performance as Minister echo Savage’s housing legacy, given that the chief executive of the country’s biggest real estate firm said a couple of days ago that “Due to LVRs, it’s a property investor’s dream at the moment because LVRs are keeping homebuyers out of the market and reducing competition for the properties investors want to buy.”, and does the Minister agree with that statement?

Hon Dr NICK SMITH: One of the most important factors for affordability in housing is interest rates, and the step by the independent Reserve Bank has made plain that without loan-to-value ratios, interest rates would go up higher earlier, and that would make the dream of homeownership so much more difficult—albeit, I note, that interest rates went up dramatically during the last Government by over 10 percent. That would be the worst thing for housing and homeownership.

Phil Twyford: How many of his rundown, surplus-to-requirement State houses in provincial New Zealand has he so far been able to unload on to unsuspecting first-home buyers, or was this just another stunt in his desperate attempt to cover up his broken housing policy?

Hon Dr NICK SMITH: I would point out that the change is simply this: every year—

Phil Twyford: How many?

Hon Dr NICK SMITH: I will get to that. Every year over the last decade, 130 State houses a year have been sold. Labour sold them to speculators. What we are doing is changing the policy and giving preference for the sale of those surplus State houses to first-home buyers. I thought that was what Phil Twyford wanted us to do—

Phil Twyford: I raise a point of order, Mr Speaker. I asked the Minister how many he had sold. That is all I asked him—how many.

Mr SPEAKER: And the answer given to the member was 130 per year.

Phil Twyford: No, no, no. That is how many are sold regularly. I asked how many under his newly announced policy, and he has not answered it.

Mr SPEAKER: I invite the member to ask the question again. I may have misheard it.

Phil Twyford: How many of his rundown, surplus-to-requirement State houses in provincial New Zealand has he so far been able to unload on to unsuspecting first-home buyers, or was this just another stunt in his desperate attempt to cover up a broken housing policy?

Hon Dr NICK SMITH: That question was full of false assertions. What the Government—[Interruption] I raise a point of order, Mr Speaker. The Standing Orders require that questions are not loaded with a whole lot of unnecessary, extra verbiage.

Mr SPEAKER: Order! The question was certainly loaded. Most questions, and certainly most supplementary questions, are. The Minister can choose whether to answer it.

Hon Dr NICK SMITH: The policy has been going for—the properties came on to the market only about 10 days ago. Housing New Zealand Corporation reported to me today that there has been a high—

Grant Robertson: None.

Hon Dr NICK SMITH: No, there would not be any yet. I will tell you why—

Grant Robertson: Right, so none. That’s the answer, isn’t it?

Hon Dr NICK SMITH: Well—

Grant Robertson: None. Sit down.

Hon Dr NICK SMITH: Actually, if you want to be a Minister, you need to be on this side, Grant.

Mr SPEAKER: Order! We will move on.

Phil Twyford: Does he agree with the New Zealand Herald, which said of his plan to sell old State houses in parts of the country where there is no housing crisis that it looks like “a Government struggling to find anything like the right answers” over housing policy, and that the Government is clearly “on the back foot over the issue of housing affordability.”?

Hon Dr NICK SMITH: The FirstHome initiative of providing the opportunity for Kiwi families in provincial New Zealand to have a free gift of a 10 percent deposit from the Government is a good initiative, in just the same way that the Government’s policy of 39,000 houses in the accord for Auckland is a good initiative, and just as the Government’s expansion of KiwiSaver is a good initiative. The problem for the member opposite is that when I announce something in Auckland, he says I am ignoring the provinces; when I announce something in the provinces, he says I am ignoring the big city. The simple answer is that you cannot please the members opposite.

Phil Twyford: Given that interest rates are heading north of 8 percent, the Government is sending people to live in camp grounds, Auckland house prices have reached record median prices, rents in Christchurch are skyrocketing, first-home buyers are shut out of the market, and property speculators are making a killing, will he be following the advice of National Party insider Matthew Hooton, who said that not even Bill English would support the Minister now and that he should be looking for a new career?

Hon Dr NICK SMITH: It is news to me that Matthew Hooton is an insider, but I would say more widely that more has taken place around housing under this Government than during 9 long years under Labour when house prices doubled, interest rates doubled, and the Labour Government spent less than half per year of what we are spending on rundown, cold State houses. I am incredibly proud of the action record this Government has on housing.

Education, National Standards—Support from Stakeholders and Confidence in Minister

7. METIRIA TUREI (Co-Leader—Green) to the Minister of Education: Does she believe that she has effectively explained National Standards to earn the trust of parents and the teaching profession; if so, why?

Hon HEKIA PARATA (Minister of Education): Yes. There has been and continues to be considerable support from parents, principals, the boards, and teachers to work with national standards. The National Standards: School Sample Monitoring and Evaluation Project report, published annually since 2010, shows good progress made in the implementation of the national standards and a steady increase in teacher reporting to parents on national standards—from 79 percent in 2010 to 91 percent in 2012.

Metiria Turei: Why, then, does she think the national standards results advisory group doubts she has the credibility to explain national standards and is looking for someone with “acknowledged authority” to explain them instead?

Hon HEKIA PARATA: The member is referring to the national standards aggregate data advisory group, which I convened, asking it to look at specifically the issues it has looked at. We have accepted all 11 of its recommendations, most of which have been implemented.

Metiria Turei: Will the Minister acknowledge that she has lost the trust of parents and teachers, as the national standards group suggests when it says: “Given the current distrust between schools and the ministry, the audience needs to have confidence that the teller of the story has credibility so the story is believable.”?

Hon HEKIA PARATA: First of all, the member is imputing that the teller of the story was me, when, in fact, the advisory group was referring to all explanations given about national standards across the country. Secondly, only two schools out of nearly 2,100 did not report their national standards data.

Metiria Turei: I seek leave to table an Official Information Act request from the deputy secretary student achievement, showing the national standards advisory group outlining concerns about the lack of trust and credibility in the Government’s oversight—

Mr SPEAKER: Leave is sought to table that Official Information Act document. Is there any objection? There is none. It can be tabled.

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

Metiria Turei: Will the Minister resign now that her Government’s key education policy needs someone else other than her to make it believable, schools do not trust the Government on education, and she has lost two High Court cases over her illegal decisions to close schools? Where does the buck stop, if not with her?

Hon HEKIA PARATA: This is the second year of reporting of national standards and we have had only two out of 2,100 schools not reporting. It relates to 365,042 students for whom we now have public metrics about what it is we need to do to raise achievement. We have implemented Better Public Services targets, which we are making measurable progress on. Teachers, principals, boards of trustees, and parents are all focused on how they raise achievement. I am confident that our Government’s programme, which is focused on achievement, is achieving that very end.

Metiria Turei: I raise a point of order, Mr Speaker. My question was whether she will resign. She has not—

Mr SPEAKER: Order! If the member had simply asked that question, we might have been able to help, but the member went on and put quite a lot in it beyond that, and then finished with “Where will the buck stop?”. The Minister addressed the question.

Welfare Fraud—Deterrents

8. MIKE SABIN (National—Northland) to the Associate Minister for Social Development: What new measures have recently begun to help prevent fraudulent criminal activity in our welfare system?

Hon CHESTER BORROWS (Associate Minister for Social Development): This week the Ministry of Social Development is starting a new low-trust - client regime that will involve a small group of beneficiaries who have been proven to be dishonestly taking money from the welfare system and put in additional checks for them to prevent them ripping off taxpayers again. They will face increased scrutiny on information they provide, be prevented from accessing services over the phone or the internet, and be required to meet face to face with the same case manager on a regular basis. Although they will still receive welfare support when they need it, these measures will make it harder for them to rip off the welfare system a second time.

Mike Sabin: How does the low-trust - client regime fit with other new measures the Government has introduced to prevent, detect, and punish welfare fraud?

Hon CHESTER BORROWS: This is one of several sensible and targeted measures the Government has introduced to stop welfare fraud. It complements other measures such as increased information sharing, streamlined investigative procedures, and joint agency investigations, all of which started this year. These measures have already seen significant fraudulent benefits worth millions of dollars a year stopped, and people put before the courts to answer for their actions.

Mike Sabin: What views has he seen on the Government’s approach to welfare fraud and alternative approaches?

Hon CHESTER BORROWS: The Government takes the view that fraud is fraud, whether it is dipping into grandma’s purse or the social fund, or taking welfare money you are not entitled to. It is all fraud, it is all criminal, and we make no apologies for treating it as such. Unsurprisingly, the feedback I have had from Kiwis out there has overwhelmingly been in support, but if that lot over there wants to turn a blind eye to crime—

Mr SPEAKER: Order! That answer is quite sufficient.

Oil and Gas Exploration—Risk Management for Deep-sea Drilling

9. GARETH HUGHES (Green) to the Minister of Energy and Resources: Does he stand by his statement that “there may well be” a relief rig present during the drilling of Anadarko’s exploratory deep sea oil wells; if so, can he guarantee that there will be a relief rig?

Hon SIMON BRIDGES (Minister of Energy and Resources): Yes, I stand by my statement. Anadarko will undertake seismic surveying in the Pegasus Basin this summer. In the event that it proceeds to exploratory drilling, it will be required—along with many other requirements—to have a discharge management plan approved by Maritime New Zealand. It must convince Maritime New Zealand that it understands all possible adverse events, that it can model a series of event scenarios, of how it will deal with worst-case scenarios, and of what resources it will bring to bear. I am not prepared to pre-empt that thorough regulatory process by assuming what will or will not be required. It could include a relief rig, though.

Gareth Hughes: Why should Kiwis believe his simplistic promises that nothing will go wrong with deep-sea exploratory drilling, when it took 86 days to plug the Deepwater Horizon blowout and he will not even commit to having a relief well in New Zealand while this dangerous drilling is under way?

Hon SIMON BRIDGES: I do not think that what I have been saying in many interviews has been simplistic. I think I have tried to run through the layered process that businesses have to go through, and the fact that some will not make it because it is so comprehensive.

Gareth Hughes: Does the Minister think his own uncontrolled blowout on Campbell Live last night did anything to reassure the people of Kaikōura that he can control a blowout 2.7 kilometres under water?

Hon SIMON BRIDGES: It is very exciting to be trending on Twitter—whatever that means—but, look, I think I have tried to be reassuring to the people of Kaikōura that there are actually great benefits from oil and gas exploration and development, and that we have the systems and the process in place to make it very safe.

David Shearer: Can he understand why the community of Kaikōura is not reassured by the measures that he is proposing with the Anadarko exploration when it can see no direct benefits from the oil, and when the containment measures and response stand currently at three 11-metre dinghies?

Hon SIMON BRIDGES: Well, I can understand fears about these sorts of things—I certainly can. Much of what the member has said is inaccurate. But the fact of the matter is that there will be direct benefits for Kaikōura if this goes from seismic surveying to exploration drilling, and then to production. There will be very significant benefits in terms of royalties that go to roads, better infrastructure and so on, and jobs.

Gareth Hughes: Is it not the real fact of the matter that the Minister is more focused on defending Anadarko’s reputation than he is on defending the environment and the economy, which relies on it?

Hon SIMON BRIDGES: I think, as I made clear on a great TV show last night, that my interests are not in defending Anadarko; my interests are actually in ordinary New Zealanders getting higher-paying jobs. That is what oil and gas can, in combination with many other things, deliver.

Brendan Horan: I raise a point of order, Mr Speaker. I move that we give the Minister more time to dig himself deeper—

Mr SPEAKER: Order! The member is very lucky he will be remaining in the House for the rest of question time.

Trans-Pacific Partnership—Briefings on Negotiations

10. Rt Hon WINSTON PETERS (Leader—NZ First) to the Prime Minister: Has he briefed the Cabinet on the progress and details of negotiations on the Trans-Pacific Partnership Agreement; if not, why not?

Rt Hon JOHN KEY (Prime Minister): The Minister of Trade regularly updates his Cabinet colleagues on progress in the negotiations of the Trans-Pacific Partnership. As the member will be aware, the Trans-Pacific Partnership has the potential to be worth up to $4 billion per annum to our economy. That is something that we want New Zealand to be part of. A report about my recent travel to APEC and the Trans-Pacific Partnership meeting, which took place in Bali, will be filed with Cabinet in due course, as is normal after an overseas visit.

Rt Hon Winston Peters: Does he intend, therefore, to brief the other MPs in the Government and, for that matter, Parliament?

Rt Hon JOHN KEY: Well, in the fullness of time, when a deal is concluded that the Government feels it wants to be a signatory of—as was the case with the previous Government—then that will go through the parliamentary process that is required.

Rt Hon Winston Peters: I take that to be a no. Does he agree with the Malaysian Prime Minister’s recent comments that the Trans-Pacific Partnership goes beyond normal free-trade agreements, and his view: “As you go beyond that, into areas of intellectual properties, investor-state dispute settlement, government procurement, state-owned enterprises, environment and labour, so you impinge on fundamentally the sovereign right of the country to make regulation and policy.”; if not, why not?

Rt Hon JOHN KEY: No, not necessarily. For a start off, I think one would have to look at all of the details of what is finally concluded. But if we take, for instance, investor-State dispute settlement provisions, we have signed those in the past. They were part of the China free-trade agreement signed by the Labour Government. They were part of the free-trade agreement signed with ASEAN and Australia. The simple reason why it is OK to do that is there were safeguard rights in those free-trade agreements.

Rt Hon Winston Peters: Why would it be right for the Parliament of Malaysia, a far more recent democracy than New Zealand, to have the right to hear about this Trans-Pacific Partnership before it signs, or—

Paul Foster-Bell: When did that member change his tune on Asia?

Rt Hon Winston Peters: I beg your pardon?

Mr SPEAKER: Order!

Rt Hon Winston Peters: Well, there is a moron up here, but he is saying some things that are rather dangerous.

Mr SPEAKER: Order! If the member wants to ask his question, he will ask it. [Interruption] Order! The Hon Annette King has not ceased interjecting through the whole of this question time. If it happens again, I will be asking her to leave for the rest of the day. Would the member please start his supplementary question again.

Rt Hon Winston Peters: Why would it be right for the parliamentarians of Malaysia to be briefed before that Government signs any agreement, or the Congress in the United States to have been deemed to have a right to see what is in the Trans-Pacific Partnership, whilst this Parliament and New Zealanders are not taken into the Prime Minister’s confidence?

Rt Hon JOHN KEY: Well, every Parliament has a different way of dealing with these issues. I cannot speak about the Malaysian Parliament, but what I can say is that as is standard—and as was standard with, for instance, the China free-trade agreement, which was handled by a Labour Government, which went through the proper and full process, as this will—it will go off to a select committee, where submissions will be made. To quote the Opposition member Phil Goff, he said last week that he understands why the Government is not releasing the text of the Trans-Pacific Partnership agreement. He is a former trade Minister. He knows how these things work.

Hon Member: Full quote.

Hon Phil Goff: Why not the whole quote?

Rt Hon JOHN KEY: Well, I am trying to defend you, which is better than what you do for yourselves. But, anyway, the truth of the matter is that Winston Peters and New Zealand First are opposed to free-trade agreements—

Mr SPEAKER: Order! The answer is quite sufficient.

Oil and Gas Exploration—Regulation and Risk Management for Deep-sea Drilling

11. MOANA MACKEY (Labour) to the Minister for the Environment: Does she agree with all the comments made by her colleague the Minister for Energy and Resources, Hon Simon Bridges, on Campbell Live last night relating to the regulation and risk management of offshore oil and gas exploration?

Hon AMY ADAMS (Minister for the Environment): In so far as his comments relate to my portfolio responsibilities, then broadly yes. I certainly agree that this Government has strengthened regulation and risk management of offshore oil and gas exploration, with a significant, layered, and sophisticated process now in place to manage the risks associated with these activities. However, I would clarify that in respect of the non-notified classifications discussed, although these have been proposed and consulted on, no final decisions have yet been made.

Moana Mackey: Does she agree with Minister Bridges’ statement “This is not the Anadarko show or the John Campbell or Simon Bridges show.”, or has she explained to him that it is, in fact, the John Campbell show and that shouting him down for merely attempting to convey the concerns of the people of Kaikōura is not the best way to demonstrate that the Government is taking those concerns seriously?

Hon AMY ADAMS: Well, thankfully, I have no ministerial responsibility for John Campbell’s show.

Moana Mackey: When Minister Bridges stated “You made it very clear on that show that you wanted to get me in to provide a balance.”, does she believe he achieved that balance by accusing John Campbell of biased reporting because he did not make “one single positive statement” about the role of Anadarko in the worst environmental disaster in the history of the oil industry?

Mr SPEAKER: The Hon Amy Adams, in as far as she has ministerial responsibility.

Hon AMY ADAMS: If the member would like to find any slim relevance of any of that to my portfolio, I would be very happy to answer it.

Moana Mackey: It is called “the environment”, but anyway—[Interruption]

Mr SPEAKER: Order!

Moana Mackey: In the event of an oil spill, how long would it take to get the “400 people on call from Maritime New Zealand” out to the site 100 kilometres off the coast of Kaikōura in the three aluminium launches owned by Maritime New Zealand, two of which are based at the top of the North Island, given a top speed for the vessels of 13 kilometres an hour when fully laden?

Hon AMY ADAMS: Let me speak really slowly so she can follow me: I am not the Minister for maritime transport—[Interruption]

Mr SPEAKER: Order! If the Minister could assist the order of the House by standing and simply answering the question.

Hon AMY ADAMS: I am not the Minister for maritime transport, who has responsibility for responses to oil spills. I would have thought the member would know that.

Moana Mackey: That is reassuring. Does she think the Kaikōura community has every right to be concerned and angry about the proposed offshore drilling, given that today her Government will take away their right to have a say through a notified process—a right that was explicitly promised to them by the previous Minister of Energy and Resources, Phil Heatley, last year?

Mr SPEAKER: The Hon Amy Adams, in so far as she has ministerial responsibility.

Hon AMY ADAMS: Well, I think the Kaikōura community would be very well aware that under Labour there was absolutely no public participation in any of these decisions because there was absolutely no process to consider the environmental impact. I think the community of Kaikōura would be delighted that under the National Government there will be now a full consideration, based on the science and technical information for each proposal.

Mental Health Services—Initiatives and Service Delivery

12. Dr JIAN YANG (National) to the Associate Minister of Health: What initiatives is the Government taking to address mental health?

Hon TODD McCLAY (Associate Minister of Health): Last week was Mental Health Awareness Week, and I wish to recognise the very many mental health workers and volunteers who every day make the lives of many vulnerable New Zealanders better. The Government has made significant progress in addressing mental health issues in New Zealand, particularly amongst young people. Initiatives include the Prime Minister’s Youth Mental Health Project, the Children’s Action Plan, Addressing the Drivers of Crime, Youth Forensic Services Development, the Suicide Prevention Action Plan implementation, maternal mental health, and, in partnership with the Māori Party, the Whānau Ora initiative. In addition, the implementation of Rising to the Challenge: The Mental Health and Addiction Service Development Plan 2012-2017 provides a positive direction for mental health and addiction services delivery and improvement for the next 5 years.

Dr Jian Yang: What reports has he received about the impact on mental health - related problems following the Psychoactive Substances Act coming into force?

Hon TODD McCLAY: District health boards and mental health professionals have reported both reduced presentations and a reduction of severity of adverse effects following the passing of the Psychoactive Substances Act, both in emergency departments and mental health units. This is a direct result of the reduction of the availability and supply of psychoactive substances. Concerningly, there are reports also that some members of this industry are not being responsible and are looking to target those New Zealanders who have mental health issues. I have spoken recently with the regulator, and through the use of regulations and cooperation with the police it is our intention to focus on this irresponsible behaviour.

Tracey Martin: In light of the answer to the primary question, can he inform us how many services are being provided around the youth mental health area in the far north, considering recent clusters of youth suicides in that area?

Hon TODD McCLAY: It is clear around the issue of suicide that it is a great challenge that many communities in New Zealand face. Recently we had statistics put out by the coroner that I recognise say there is some progress, amongst sorrow, in suicide numbers. In particular, around men, Māori, and young people the numbers have dropped, but I would say that any level of suicide is too high in New Zealand. I am happy to provide the exact numbers of services and beds available to the member afterwards. But this is an issue that communities all over New Zealand face. It is absolutely a tragedy when people of all ages take their lives. I think what we need to do is look for ways to find some of the very good work that is being done in some parts of the country and emulate that on a community-by-community basis.

Hon Annette King: I seek leave to table a letter to me from the Lakes District Health Board showing that mental health funding to the NGO sector in that district health board was cut in the last financial year.

Mr SPEAKER: Leave is sought to table that letter to the Hon Annette King. Is there any objection to that course of action? There appears to be none. It can be tabled.

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

Urgent Debates Declined

Schools, Canterbury—Judicial Decision on Proposed Merger

Mr SPEAKER: I have received a letter from Chris Hipkins seeking to debate the recent decision of the High Court to overturn the decision by the Minister of Education to merge Phillipstown School and Woolston School on to the Woolston site. For there to be an urgent debate, there must be an administrative or ministerial responsibility for the case of recent occurrence. The member in his application cites the judgment of the High Court issued on 9 October as the particular case of recent occurrence. A Minister has no responsibility for the court decision itself. An urgent debate is a way of holding the Government accountable for an action for which it is responsible. There must be distinct governmental responsibility for the particular case that is sought to debated. A decision of the High Court is not a matter for which any Minister has responsibility. The application is therefore declined.

Bills

Telecommunications (Interception Capability and Security) Bill

Referral to Law and Order Committee

CLARE CURRAN (Labour—Dunedin South): I move, That the order of the day for the second reading of the Telecommunications (Interception Capability and Security) Bill be discharged and the bill be referred to the Law and Order Committee for consideration.

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

Ayes 55

New Zealand Labour 33; Green Party 14; New Zealand First 6; Mana 1, Independent: Horan.

Noes 64

New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1.

Motion not agreed to.

The result altered by leave after originally being announced as Ayes 54, Noes 64.

Second Reading

Hon AMY ADAMS (Minister for Communications and Information Technology): I move, That the Telecommunications (Interception Capability and Security) Bill be now read a second time. The bill was referred to the Law and Order Committee in May 2013 and I would like to thank the committee for its consideration of the bill. I also want to acknowledge the many useful public submissions that have resulted in changes to the bill.

The bill contains two key parts. Part 2 of the bill amends and replaces existing obligations on telecommunications companies in the Telecommunications (Interception Capability) Act of 2004 to ensure that obligations are targeted, future proof, and flexible. Part 3 of the bill introduces a new network security framework to ensure that network operators work with the Government Communications Security Bureau (GCSB) to identify and address security risks in the design, build, and operation of public telecommunications networks at the point that decisions are being made. This builds on and formalises the approach taken today. These parts are reinforced by a robust compliance and enforcement framework.

Looking firstly at interception capability, submitters said that there were some ambiguities in the bill as introduced, and in response definitions have been clarified, such as the definition of “service provider”. This will put beyond doubt that the provisions of this bill apply to all service providers that make their telecommunication services available in New Zealand. There has been a change to clarify the position on decryption in relation to the duty to assist. Once more, this puts beyond doubt that network operators or service providers may be required to decrypt a communication only if they themselves have provided the encryption. The select committee heard from industry that it needed time to participate in decision-making processes and also to implement its obligations, so amendments have been made to ensure that companies will have a reasonable amount of time in which to make submissions to a Minister and reasonable time frames to comply with any directions or new obligations.

Looking at network security, the select committee has made two key additions to the network security requirements to provide greater certainty to industry about how network security risks will be identified and how the framework will work in practice. The first is that the bill sets out a clear decision-making process that the Director of the GCSB and the Minister responsible for the GCSB will follow in finding a network security risk. The second is that the bill now provides that the GCSB can issue guidelines that will assist the industry in complying with its requirements. These amendments respond to requests from the industry for greater specificity and certainty. The industry also sought that the framework be better targeted. The select committee has made a number of changes to achieve this. It has narrowed the scope of the requirement for network operators to engage so that it is clearly focused on future risks, while also ensuring that the director can exempt network operators from discussing matters that will not raise network security risks.

Amendments have also been made to give greater clarity to network operators about the areas of the networks that they must report on when they are proposing changes or making procurement decisions. In addition, the bill now provides that the director can identify only network security risks that are more than minimal. This responds to concerns from industry that minor issues could have been raised with it.

To ensure that the GCSB acts in a timely way and does not unduly interfere with network operators’ commercial operations, the select committee has included a new statutory principle for network security that requires the director to make any decision or take any required steps as soon as practicable. Together these amendments will provide greater clarity and certainty to network operators about network security requirements.

In respect of the compliance and enforcement provisions, the bill as introduced provided for the protection of classified security information and court proceedings and that a special advocate be available to assist non-Crown parties in court by accessing classified information on their behalf. Submitters said that the special advocate provisions could be strengthened, giving more safeguards to non-Crown parties. The select committee has responded to this by making amendments to allow a special advocate to make oral and written submissions to the court, and to cross-examine witnesses, allowing the non-Crown party to propose a person to be the special advocate and by making it clear that the relevant surveillance agency is to pay the cost of that special advocate. These changes will provide additional protections to network operators and service providers in court proceedings.

I will shortly be asking the House to consider a Supplementary Order Paper during the Committee of the whole House stage that will also make a number of additional amendments. Firstly, that Supplementary Order Paper proposes removing the ministerial direction power in relation to overseas telecommunication services resold in New Zealand, as this could create a competitive disparity if applied, and we agree is better addressed through the enforcement framework. Secondly, the Supplementary Order Paper introduces a review by the Commissioner of Security Warrants of the material that has informed the opinion of the Director of the GCSB that there is a significant network security risk. This will be a mandatory step in the process if the director is considering referring the matter to the Minister responsible. If a direction is sought, the Minister must consider the report from the commissioner.

The Supplementary Order Paper will also strengthen and clarify the matters that the Minister responsible for the GCSB must take into account before issuing any direction on network security. This will require a thorough weighing of costs and benefits. The Supplementary Order Paper also contains other minor amendments, such as narrowing the kinds of changes that a network operator must not notify to the Government.

This bill is about reducing obligations on some network operators to pre-invest in interception capability. It allows more flexible and faster processes for exemptions, and provides a structured process for changing obligations where there is an operational need. These changes are important so that our legislation can keep pace with the changing telecommunications industry and remain fit for purpose. The network security framework formalises and builds on the existing partnership approach taken between Government and some network operators. It allows the sharing of information and collaboration between Government and industry, to help ensure that the public telecommunications networks are secure, and remain secure. The shared compliance and enforcement framework underpinning the bill gives surveillance agencies an ability to deal with minor and serious non-compliance in more appropriate ways.

Finally, can I respond to some of the incorrect claims that have been put forward by some groups, which do not reflect an accurate understanding of what the bill does and does not do. There have been incorrect claims that this bill will create back doors in our public telecommunications networks. This is simply incorrect. Encryption requirements do not have the effect of weakening encryption or creating security vulnerabilities. The requirements in this regard are consistent with the position in the current Act. The bill also does not require a network operator to provide open access to their networks to surveillance agencies. The bill also maintains requirements on network operators and service providers to protect the privacy of communications not affected by the warrant.

The bill does not provide for the GCSB to force a company to fundamentally undermine the security of their services, as some have claimed. The only role of the GCSB in relation to network security is to identify risk and to advise the network operator. It is up to the network operator solely to take any action. It is only where the GCSB believes that there is a significant risk to national security that it can advise the Minister to issue a direction. This is an option of last resort for our most serious security concerns. Again, I would like to reassure the public that this bill does not change in any way the authority of agencies to intercept telecommunications. It does not change existing privacy protections, and it does not require data to be stored or require any stored data to be disclosed. The bill relates only to real-time interception under warrant. This bill gives greater clarity and certainty to industry about their obligations and will ensure that our law enforcement and security agencies have the appropriate support from industry to keep New Zealand and New Zealanders safe. I commend the bill to the House.

Hon DAVID CUNLIFFE (Leader of the Opposition): I rise to take a call in this second reading of the Telecommunications (Interception Capability and Security) Bill to place on record Labour’s continuing strong opposition to this legislation. We do so for three principal reasons. The first is that the bill facilitates the implementation of its companion legislation, the Government Communications Security Bureau Amendment Act, which fundamentally reduces the rights and freedoms of New Zealanders by providing insufficient protection against the spying on New Zealand citizens by State agencies. The second reason is that the bill is so poorly and broadly drafted that it raises a raft of questions that have not been fully debated in the Law and Order Committee or by the Minister for Communications and Information Technology, who cannot even be bothered listening to the arguments that have been raised. Shame—shame! Thirdly, it is because such concessions as have been made under pressure have been made only to the global majors, the Googles and the Facebooks, not to the citizens of New Zealand, and that is very revealing about whose interests this Government will in fact listen to.

Let us turn first to the Government Communications Security Bureau Amendment Act, and this is relevant and absolutely fundamental to the core of this bill because the interception capabilities it provides for are a necessary step for the operation of the Government Communications Security Bureau Amendment Act. It is completely nonsensical to say, as the Minister just has, that this bill does not change the privacy protections. It does not need to, because they have just been done away with in the Government Communications Security Bureau Amendment Act, which this legislation implements. Without this legislation, the Government Communications Security Bureau Amendment Act could not work because it would not be able to plumb into people’s telecommunications systems. Likewise, the Minister’s protestation that this is only real-time interception and has nothing to do with data storage is ridiculous because it facilitates the Government Communications Security Bureau Amendment Act, which makes clear that the storage of data is completely within the powers of the Government Communications Security Bureau (GCSB). So it goes through the pipe, which this bill institutes, and it is then subsequently stored. We oppose this bill because of its instrumental effects, as well as its intrinsic weaknesses.

Let me turn to a raft of problems in the drafting. To say that this bill is too broad and its drafting is shoddy is to pay it a compliment. It expands the reach of interception obligations to a much wider group of companies—now, for the very first time, including service providers. So all internet service providers are, as a starting proposition, covered by the impact of this bill. Any internet service providers, even smaller ones, must at the very least be “intercept ready”, and substantial ones must actually be intercepted. That is a huge cost, and it is a huge broadening of the powers of the State to access the private information of New Zealanders. But they do not care about the balance between protecting New Zealanders from foreign attack and protecting New Zealanders from the loss of their own freedoms, because there is no adequate protection in this bill.

Let me get a little technical for a second. In the companion Government Communications Security Bureau Amendment Act, it provides for the ability to intercept “all transmissions” that apply to “information infrastructure” for any purpose to do with “cybersecurity”. So the GCSB only has to decide that a risk is related to cyber-security, and it can take any step, without a warrant, to address matters to do with information infrastructure, which includes all of the transmissions going across it. That is not just phone calls; that is emails, text messages, gaming, records from Google and Facebook—a history of anybody’s internet use. In fact, the entire so-called digital shadow of any New Zealand citizen could be deemed to be a transmission for the purposes of information infrastructure and thus is accessible without a warrant under the Government Communications Security Bureau Amendment Act. It is this bill that technically makes that possible. How could any responsible party sign up to that?

The Prime Minister, when confronted with those issues, said that he would require a warrant for cyber-security intercepts. When asked to put that personal assurance in the bill, he said: “Oh, no—oh, no.” We all know that the Prime Minister’s personal assurances are not worth the paper that the media report is written on. Take, for example, “I will not raise GST.”, or “Working for Families is communism by stealth.”, or a host of other slippery little manoeuvres that mean that the Prime Minister’s word is not to be accepted. The case for the expansion of these powers has not been made.

Let me raise another very serious matter in relation to that. In the companion bill, now the Government Communications Security Bureau Amendment Act, there is no explicit requirement for the warranting provisions to apply to overseas-sourced data that is used by the New Zealand agencies. As we all know, we are part of the “Five Eyes” partners. If the New Zealand agencies were required to get a warrant to access the data on, say, a member of Parliament, the overseas partners were not. Thus, the New Zealand agency need only ask for or dial up the information obtained by the “Five Eyes” partner, and, hey presto, the requirement for a warrant could be circumvented. The Government has never, in the history of the GCSB legislation, answered that debate. Today, we are asked to pass legislation that provides the pipes and wires that make that travesty possible. So there is no doubt at all as to why the Labour Party opposes this rotten bill. It is because it gives effect to another rotten bill that should never have been passed by the New Zealand Parliament.

The definitions in this bill are all over the place. It widens its scope to network operators, service providers, and resold overseas telecommunications company services. Like the Government Communications Security Bureau Amendment Act, it widens the scope for interception from security matters to economic matters. Well, goodness me! Economic matters could be anything—anything—within the purview of the Minister for Economic Development—

Grant Robertson: That’s everything.

Hon DAVID CUNLIFFE: —which is, as we know, pretty much anything, because here he is, representing the entire Government. Why? Because this bill gives him the power to intercept anything that he or his agencies deem to be of economic advantage. That is a travesty. The only thing standing between New Zealanders’ personal privacy and that Minister is John Key’s word.

Iain Lees-Galloway: That’s a scary thought.

Hon DAVID CUNLIFFE: That is a truly scary thought.

On the third broad issue that we have raised, we welcome the withdrawal of the odious clause 39, which meant that the Government, by fiat, could prevent the provision at all of a telecommunications service in New Zealand. But we note that it is only in response to the Googles and the Microsofts of the world—rather like, perhaps, the Warner Bros of the world—that this Government is ever prepared to change its mind. To say “change its mind” might be something of an overstatement in regard to certain of its members.

But what about the interests of the ordinary New Zealander? Today we drew attention to the loss of jobs in our regions, and the Government felt it was OK to laugh. It may laugh, but New Zealanders will get their own back when the ballot boxes open in a year’s time, and they rise up to say very, very, simply: “No. 1, we think our rights and freedoms matter. No. 2, you, Big Brother National, have not made the case to take them away. You have not got the balance right. This legislation stinks, and we, the little people, matter.” They matter as much as Google. They matter as much as Facebook. They matter as much as Apple. They matter as much as Amazon. They matter as much as anything, because it is the principle, not the power, that should be guiding the Government in framing fundamentally important legislation that affects the rights, personal freedoms, and privileges of every single New Zealander.

JACQUI DEAN (National—Waitaki): I rise with great pleasure in the second reading of the Telecommunications (Interception Capability and Security) Bill. This bill repeals and replaces the Telecommunications (Interception Capability) Act 2004. It is probably good to remind the House, and for the House to remember, that that was in fact a bill that was brought in by the previous Labour Government. So it does seem a little unnatural, does it not, for the Labour Government to have brought in the original Telecommunications (Interception Capability) Act, and for the Labour members now—perhaps it is matter of convenience—to not support this bill before the House.

I think it would be a great idea for this House to remember what this bill is for, and what this bill is intended to do. So, there are two parts to this bill. The first part is to clarify interception obligations for telecommunications companies, recognising that time has passed since 2004, when the then Labour Government brought in the original Telecommunications (Interception Capability) Act 2004. The second part introduces a transparent network security regime for network operators and for the Government to work together on matters of national security. That is what the bill is for—for telecommunications companies and the Government to work together on matters of national security. To believe otherwise, I think that one would have to live in some kind of parallel universe, where it was not believed that there was a necessity for police and security agencies to have the ability to solve crime. That is what this bill empowers our security agencies and our police, on receipt of a warrant, to do—to get in and to solve crime. So, interception of telecommunications and intercepting telecommunications in real time play an absolutely vital role in investigating crime, in disrupting crime, in prosecuting crime, in detecting and prosecuting international and domestic cyber-crime, in combating threats to national security, and in responding to emergencies such as kidnappings, which happen in our society.

If the Labour members want to turn a blind eye to national security, then on their heads be it, because in opposing this bill, that is exactly what Labour is doing. What Labour is saying to the people of New Zealand is that it does not believe there is any serious crime in New Zealand, that it does not believe that methamphetamine is a problem, that it does not believe that there are cyber-crime issues, or that there are issues relating to overseas companies’ investment into New Zealand and our global reputation as a good place to do business. Labour does not buy into any of those issues in opposing this bill. Well, I can tell Labour that that is exactly what this telecommunications bill does.

I just want to go over a couple of case studies. One relates to the solving of crime to do with methamphetamine. The New Zealand Police were advised by an overseas police force about an organised crime group that was smuggling drugs and precursors to drugs into New Zealand, so the New Zealand Police—and, of course, they were acting under the 2004 Telecommunications (Interception Capability) Act, which was brought in by the previous Labour Government—were able to intercept communications and bring about a successful prosecution. I think they realised something like 150 kilograms of pseudoephedrine, which otherwise, had it not been intercepted, would have ended up on the streets of New Zealand, in the communities that Labour professes to care so much about. It would have caused untold misery to the very people whom Labour professes to really care about because of the interception capability under the previous telecommunications Act, which is being brought up to date with this bill. That crime would have gone unsolved and untold misery would have been brought about for the New Zealand public.

Another case study I just want to talk about is to identify and rule out innocent people. A child was murdered, again, under the time of the previous telecommunications Act, which was brought in by the previous Labour Government—you see, Labour liked national security when it was in Government, so why is it that it does not like national security any more? Perhaps the next speaker from Labour might explain to the House how not supporting this bill would have helped this child who was kidnapped, where the police regarded the child’s own family as being responsible? How much heartache would there be around circumstances like that? Through the telecommunications of the day, the police were able to determine that the child’s own family were not responsible for this crime and, indeed, the police were able to detect who the perpetrators of the crime were. Well, Labour needs to tell the House how, without the kind of provision that is being brought in by this bill, we are going to solve crimes like that. How are the police and our security agencies going to protect New Zealanders if it were not for this bill? That is what this legislation is all about, and I commend it to the House.

CLARE CURRAN (Labour—Dunedin South): It is a pity that the chair of the Law and Order Committee did not spend more time talking about the bill before the House, the Telecommunications (Interception Capability and Security) Bill, rather than the previous legislation. New Zealand is a small, stable democracy and the provisions around the privacy of our citizens should be paramount. The security of our public and our private sector entities is also paramount. The mark of a democracy is to commit to both and to always strive to achieve a balance. Unfortunately, this bill before us today tips that balance, and it tips that balance, along with its companion bill, the Government Communications Security Bureau Bill, in ways that ignore the importance of citizens’ privacy. It also ignores the concerns of New Zealand - based companies in our New Zealand technology industry. It also largely ignores the concerns of the bigger internationally based internet companies that are increasingly providing services to New Zealanders over the internet, and it has ignored the concerns of civil society.

This is a bill that New Zealand should, and does, feel ashamed of, and it is one that this Government has made effectively no case for. It has barely listened and it is rushing the legislation through the last stages in this week because it knows that it cannot truly defend it and it wants to get it over and done with as soon as possible. We need a rights-based approach to policy making and to legislation in this country—one that promotes New Zealand as an innovative nation in a digital environment, one that guarantees the privacy of citizens’ information, and one that promotes a digital economy in a fair and open, transparent manner, not one that is setting up barriers and that results in a chilling effect on our digital economy. That is what this bill does today.

There are many reasons to vote against it. There are three main ones, which I am going to touch on today in this second reading speech. Firstly, this bill impinges on the rights of New Zealanders. It creates a chilling effect on New Zealand industry and it has resulted in major internationally based service providers calling into question the conflict between this bill and international law, and the extraordinary increased powers being provided to both the Government Communications Security Bureau and Ministers without checks and balances to provide balance against a rights-based approach.

New Zealand has the New Zealand Bill of Rights Act. We are proud of this framework and we believe it is there for a purpose. Every piece of legislation that passes through this House is meant to be vetted against the New Zealand Bill of Rights Act, and the Attorney-General is meant to report any consequences. We can make comment about the rubber-stamping of that vetting process, which is increasingly apparent under this Government, but we should also make comment about what happens when a bill is significantly amended in the select committee and where it appears that there may indeed be conflicts with other law.

Labour supports InternetNZ’s submission in calling for a thorough test of this bill, the Telecommunications (Interception Capability and Security) Bill, against the New Zealand Bill of Rights Act. The New Zealand Law Society called for the same in its submission on the Government Communications Security Bureau Bill. In its sparingly used direct reporting power to the Prime Minister, the Human Rights Commission determined that the Ministry of Justice’s vetting of the Government Communications Security Bureau Bill and the Telecommunications (Interception Capability and Security) Bill against the New Zealand Bill of Rights Act both fell short. Just as the Government Communications Security Bureau Bill failed to provide the adequate safeguards for people’s privacy to balance that intrusive right of the State to collect the private information of New Zealanders, the Telecommunications (Interception Capability and Security) Bill, as implementing legislation, has failed as well, and the Government has refused to add adequate safeguards.

My motion put at the beginning of the second reading of this bill sought to refer the bill back to the Law and Order Committee following the amendments put forward by the Minister last night, because it is our view that although most of those amendments are window dressing, the impact of those amendments need to be tested against advice by officials and that there has not been discussion at the select committee about the costs and implications on networks of the capital expenditure required to comply with the provisions of this bill. So Labour stands by its comment that the Government has been negligent and irresponsible in its approach to this bill and in its handling of the bill through the whole of the select committee process.

I want to comment on two other aspects of the bill that submitters raised in the select committee and subsequently that have not been addressed and that leave us with a deeply flawed and anti-democratic piece of law, which will have a chilling effect on our innovative economy. The Minister for Communications and Information Technology has claimed that this bill is merely an updating and modernising of previous legislation and that it does not increase the powers of the Government Communications Security Bureau or Ministers; rather, it clarifies those powers and clarifies the duty to assist of various organisations. Well, if that were true, then Labour would have very little to argue with in this bill, because we agree that modernising legislation is important, we acknowledge that law in the digital environment is important, and we agree that ensuring the security of citizens and public and private sector entities is important. We also acknowledge that the important role of our security agencies is important. But this bill does not do that.

The definition of a “network operator” in the legislation is so broad that it captures any entity that has an interactive website—any entity that has an interactive website. I say that again because it is really important. It uses the broadest possible definition of a “network operator”, which is “(b) a person who supplies (whether by wholesale or retail) another person with the capability to provide a telecommunications service”. As the Minister has heard from submitters, this encompasses just about everyone involved in the information and communications technology sector who supplies “goods, services, equipment, and facilities that enable or facilitate” the “conveyance by electromagnetic means from one device to another”. That is the definition of a network operator drawn from this bill, but it relies on the definition of “telecommunications service” drawn from the Telecommunications Act. So that could mean any software as a service that allows a user to share content via a social networking site, such as a post to Facebook or Twitter. It would appear that any web-based platform, provided that it includes those social functions that are then used to enable or facilitate telecommunication, may be caught. That could include the Stuff website, the New Zealand Herald website, the Television New Zealand or the TV3 websites, or the TradeMe website. Are those services caught up in the definition of this bill? I am advised that technically they are. So what are the implications of this bill for our news media?

It can also include a physical data centre provider that leases rack space to a virtual server provider, which in turn leases space and services on those virtual servers to businesses, which enables customers of those businesses to communicate electronically with each other. They also appear to be under the definition of a network operator. All or some of the businesses in that chain may be defined as network operators.

Every member of Parliament today will have received a letter from NZRise, which is the industry group for the New Zealand - owned digital technology sector. NZRise wrote to all of us and asked us to vote against this bill because it says that the bill is drafted so broadly that it creates huge uncertainty, and that, therefore, creates business and investment risk for anyone in the New Zealand information and communications technology industry, or anyone considering entering it. NZRise says that the compliance obligations create chilling and unworkable effects. It says that many non-traditional telecommunications companies will technically and financially be unable to comply with those obligations, so they will be faced with either being in breach or curtailing their activities. This is unacceptable. It is unacceptable that a bill should have gone through a select committee process, and that the Minister for Communications and Information Technology and the National-dominated committee should have ignored all of the advice and all of the submissions on this particular issue. If for no other reason, this is a reason to oppose this bill.

STEFFAN BROWNING (Green): I rise to speak to the Telecommunications (Interception Capability and Security) Bill. We too agree that this bill should actually have gone back to the Law and Order Committee because of the changes to it. In fact, changes were dropped to us even as late as last night, in terms of Supplementary Order Paper 366, which has got right down into some of the things that we were, in fact, asking for. But they have not been addressed properly, and we have not been able to look at them deeply enough yet. Some of them appear to be helpful to industry to a degree, but there is certainly nothing helpful for the citizenry of New Zealand.

This bill is part of the fix following the Government’s mess-up with illegal spying on at least 85 people whom it has admitted to spying on. The Government admitted to illegally spying. Then we got the Government Communications Security Bureau (GCSB) bill and now we have the Telecommunications (Interception Capability and Security) Bill, which is its partner in crime, as such. The GCSB bill has basically set up the philosophy that you can spy on New Zealanders, that you can invade their privacy, and that you can breach their human rights, and then this bill is the technical part of how that can happen.

There are some little chips and changes, it seems, and as we get into the Committee stage later we can maybe look at those a little bit more deeply. But there is a bundle of people—80-plus people—who have the right right now to know whether they were illegally spied on while it was illegal. They are, I am very sure, due for an apology because not one of them whom I am aware of was arrested or charged with any crime, and yet they were illegally spied on. Then we would also need to ask how they were spied on, exactly which agency or agencies spied on them, and what conduit was used to spy on them. Was it part of what is covered in this bill? Was it something external to New Zealand and fed back into New Zealand?

Although we are opposing this bill, we also see this bill as a veneer. It is just a wee bit of a legalised surface to the whole spying operation. We have had plenty in international media, and consequently in New Zealand media, about Edward Snowden, PRISM, the National Security Agency in the United States, and its link into New Zealand through the Waihopai spy base and the GCSB. What was going on there? And what we have been saying for decades—and now it has been shown to come true—is not even covered by this bill. This bill certainly opens up the portals that those agencies will be able to exploit, possibly without the different service providers even knowing. The service providers make sure that their technology and their services are snoop-friendly. Sometimes, no doubt, they will be aware that that is happening when there is a proper warrant and everything going through, but do they know for the rest of the time? Did they know in the past, when New Zealand’s “Five Eyes” complicity was involved, that the information that was going through their portals was being taken away and being stored by the National Security Agency of the United States?

The Minister for Communications and Information Technology says that this bill is no back door. It may be that this bill does not seem to be that, but the fact is that the different service providers have to either have their services intercept-ready or be capable of doing that at relatively short notice, because this bill goes on about the short time they have to comply. Is it a back door? I do not think the Minister can say that with the confidence she appeared to have before.

I point out that in the United States at least one operator has said that it is over it and that it is not going to even carry on operating in this business any more, because it is not prepared to be complicit with the breach of human rights. It was not prepared to have surveillance on its customers, and it has actually closed down shop. This is part of the risk here where some operators will not provide services that could be available in other parts of the world, because they are not prepared for their customers to be under this sort of surveillance, and it clearly stops the innovation within New Zealand. I do note as well that in the Supplementary Order Paper, which we will get into through the Committee stage, innovation is mentioned as one of the considerations, and I think that is a positive thing. However, that is very subjective. We have got no idea as to what degree innovation will be considered at that point.

The Minister has invited us to meet some time to discuss the legislation, and I think that will be appropriate and we will take that up. But one aspect in her note to the Green Party states that nothing in the information-gathering powers under clauses 72 and 73 will permit a designated officer or the GCSB director to require a network operator to supply, produce, or reproduce any information that could have been obtained or should have been sought under an interception warrant or other lawful interception authority. That is that back-door part, and that will be something I would like to explore. Some things I will point out, but other things about that I will question. The “Five Eyes” scenario that we are part of through Waihopai definitely seems to be part of that.

I notice that Google, Microsoft, Skype, and Apple are still unhappy, even though the Minister appears to have tried to make some changes to accommodate some of their concerns. They are still unhappy. They can see where the weaknesses lie in this bill. The Minister has also given us a flow chart showing us where intercept ability already exists, what the current Telecommunications (Interception Capability) Act does, and where the proposed changes sit, and she has said what the bill does not do. She says that it does not change the authority of agencies to intercept communications. Well, we have got the Government Communications Security Bureau Act and the Search and Surveillance Act, both of which certainly allow a certain amount of interception of telecommunications. So, no, this bill does not do that; it is basically just, as someone described it, the pipes and the conduits to do that. She says that it does not change existing privacy protections. No. We have asked for, we still believe in, and we will be looking forward—later, in 2014—to being able to initiate a full inquiry into the security services in this country, to ensure that we have an understanding of what is going on with our security agencies. We might also be able to find out how the Minister can say the things she is saying, when Snowden and others have exposed those “Five Eyes” points. We might be able to expose who the 80-plus people were who were spied on unreasonably. The Green Party will be opposing this bill through its stages. Thank you.

Rt Hon WINSTON PETERS (Leader—NZ First): When the Telecommunications (Interception Capability and Security) Bill came before the House in its first reading, New Zealand First said that we would support it going to the Law and Order Committee, and that our support was conditional on there being sufficient oversight and safeguards put in place so that the rights and freedoms of New Zealand citizens and residents are not jeopardised or disregarded in the execution of the powers that this bill encompasses.

The fact is, though, that at the select committee it became very apparent that this bill has been watered down, but that the Hon Amy Adams does not understand it, or the internet, or any of the technical implications of the law she is trying to pass. She has four of the largest providers of internet content and email—Google, Yahoo!, Microsoft, and Facebook—saying that there will be legal conflicts with other countries, and that this law is out of alignment with approaches taken by the UK, Canada, the United States, and Australia. That is pretty damning when you think about it, because those are the other parties to the “Five Eyes” arrangement, much vaunted by the members of the National Government for a long period of time. The New Zealand Government’s approach differed from how the United States, Britain, Canada, and Australia had decided to tackle interception issues—so say Google, Microsoft, Facebook, and Yahoo!. However, Amy Adams rejected that, saying that this bill was “not out of step”. The real question straight away becomes how she would know.

The reality is that New Zealand First is concerned by the way the Government and Ministers, and the Prime Minister in particular, expect people to believe their assurances—assurances blandly given. You will recall that before the House rose for the adjournment, we raised the issue of a raid by the SIS in July of last year on members of the Fiji Democracy and Freedom movement in this country. Here is Mr Key’s answer: “I am not in a position to comment on that.”, he said. “I do not have those details, but I will say that I understand that there has been a radio report—at least, I have been advised that Mr Singh said that he complained to the Inspector-General of Intelligence and Security. I am advised that the New Zealand Security Intelligence Service has no record of a formal complaint to the inspector-general in relation to what the member is talking about. If Mr Singh feels there is a problem, he should follow his legal rights and make a complaint to the inspector-general.” Well, there was a complaint to the Ombudsman. The Ombudsman has referred that on to the inspector-general, but the Prime Minister came to this House and he told everyone that there is no concern, because the only example of illegality is in the case of Kim Dotcom. That was his statement.

When you see a group like United Front for a Democratic Fiji put out, on Thursday, 10 October—just a few days ago—a statement like this, you have got to be concerned. It said: “It is therefore with nothing short of horror that the council has reacted to the response by the Prime Minister to recent revelations in Parliament regarding an illegal raid carried out by the SIS in July last year upon members of the Fiji Democracy and Freedom movement in Auckland, in which the Terrorism Suppression Act was invoked by way of justification.” The raid was based upon the pretext of alleged discovery of an assassination plot against the Prime Minister of Fiji, Frank Bainimarama. That is the background to this. Do not forget that the Prime Minister, on successive days, got up in Parliament and said there was nothing to worry about.

Here are the objectionable features. The raid was carried out in collusion with the Fiji military. That is abundantly clear from all the texts from the commander of the Fiji land forces back to New Zealand, all on his phone, showing that he had knowledge, at the time the raid was being carried out, of the raid itself. The second matter is this: those carrying out the raids, who identified themselves as members of the SIS, asserted that there was cogent evidence to support the assertion of the existence of an assassination plot, yet no follow-up action or criminal proceedings were ever taken or are prospected to be taken even now. So that disposes of that humbug. Third, the plot—the subject of the raids—was used as a pretext for stripping a New Zealander of his New Zealand passport, whereas when he filed proceedings in the High Court to challenge that step, the Minister of Internal Affairs backed down and conceded, one week before the set hearing date occurred. So one week out, when challenged with all this information and knowing that it now had to justify the SIS action, the Government withdrew. Again, the Prime Minister claims that there is nothing wrong with that—nothing untoward.

This is the fourth point: no warrant was shown to justify the raids. A warrant was requested to be shown, but was refused to be shown on the basis of being confidential. That is a most extraordinary claim for an SIS officer—a female in this case—to make, because the reason why the warrant is in that person’s hands is that it is the legal and authoritative justification for that member to be there carrying out that raid. When requested, it must be shown. In fact, it should be shown voluntarily. Plus, their name should be given. So on all four counts, the Prime Minister’s assurance to this House is found wanting, and seriously wanting. That might be the behaviour of somebody from Merrill Lynch, but it is not the behaviour of someone who seeks to lead one of the great democracies of this world, one of only nine nations that can boast a long line of unbroken elections for the last 150 years. That is how much this Prime Minister misunderstands his duties and responsibilities. He is prepared to come here and say “Trust me.” Really? Why would we, given that when he is asked this series of questions over 2 days, he gives these bland assurances that because he is in charge, he can be trusted? Everyone knows now that he cannot be.

This case will not go away, but it is the background to the kind of information that is being discussed in this House today, and here comes the Minister for Communications and Information Technology, who says “Look, I’ll send somebody to brief you.” Who? Her? What is her expertise in this industry? You have got Microsoft, Google, Yahoo!, and Facebook, all of which know that their arrangements with the other “Five Eyes” countries—Australia, Canada, the UK, and the USA—are different. But, no, we are expected to believe that by some giant intellectual feat, this Minister and the Prime Minister can be trusted to understand the issue and ensure that the legal safeguards are in place.

What the bill is basically asking for is the equivalent of getting New Zealand Post, at a moment’s notice, to read all incoming mail for a group of people, make it contact whoever wrote the letters, and demand that they cooperate with the New Zealand Government.

Jacqui Dean: Not true.

Rt Hon WINSTON PETERS: I know that what I have just heard from over there is rubbish, but I am not dealing in the speciality of that member from the South Island; we are dealing with facts. What the bill is basically asking from us is the equivalent of getting New Zealand Post, at a moment’s notice, to read all incoming mail for a group of people, make it contact whoever wrote the letters, and demand that they cooperate with the New Zealand Government. How on earth is that responsibility one that New Zealand Post should bear? New Zealand Post is also expected to bear the cost. That is exactly what is going on here. In this case, the internet service provider—that institution—is the post office. It will pass the costs on to the consumers to pay for the privilege, madam, of being spied upon. Either put up somebody else to refute the argument being put up by the Opposition or kindly keep quiet, because sitting there and not putting anyone up is not an adequate defence for what the Government says is a laudable, needed, essential bill for the security and safety of New Zealanders.

That is why we have changed from supporting the bill, having seen it at the select committee hearings and seen the way the Minister has treated it, to now opposing it.

MARK MITCHELL (National—Rodney): The Telecommunications (Interception Capability and Security) Bill is a very good bill. In simple terms, we would be negligent as a country, as a Government, and as a party if we allowed a company to come in here and build a highway—a privately built highway—gave people access to it, and allowed them to use it without any form of oversight and without any form of policing. You are going to get a lot of people who want to use that road. They are going to want to use that highway, and they are going to want to use it for legitimate purposes. But I can tell you something right now: you are going to get a lot of people who want to use it for illegal purposes. If we as a country turn round and say: “You know what? Go for it. Fill your boots. Use it any way you want.”, then we are not going to be able to do anything about it.

All we have done is we have said that the police, if they have information, will be able to access the information that is being used on these information highways. It is a good bill. The bill does not change the fundamentals of existing safeguards to protect people’s privacy, it does not change in any way the authority of agencies to intercept telecommunications, and it still requires data to be stored and stored data to be disclosed. Thank you.

Hon PHIL GOFF (Labour—Mt Roskill): This legislation, the Telecommunications (Interception Capability and Security) Bill, as I foreshadowed in the first reading of the bill, shows all the signs of being rushed, being ill-conceived, and lacking proper consultation. We saw that with major changes made at the Law and Order Committee. The authors of the bill seemed to imagine that they could order the network providers to decrypt communications carried over their networks for which they never had the keys for the decryption to take place. They had to back off that. The authors of this bill and the Government seemed to think that they could order companies that were not domiciled in New Zealand to follow our law as against the conflict with the laws in their country of origin. They had to admit that and back off that.

They made changes in the select committee, but I woke up this morning and read the Dominion Post to find that another major change has been made at the eleventh hour, coming in in the Minister Amy Adams’s Supplementary Order Paper 366, and that is that clause 39 will now be removed. That is the clause that allows the Government to block an overseas company from offering services in New Zealand if it lacks interception capability. What is the cause of that? That change in that Supplementary Order Paper has been made outside of the select committee process. It has been made in a private deal between the Minister and some of the big companies. We have not been given an explanation and we should be given an explanation as to why the Government members on the select committee were ordered to stand behind that clause all the way through the discussions, to die in a ditch for the Government’s stand on it, only to have the rug pulled out from under their feet and to have that clause changed at the eleventh hour. Does that sound to you like legislation that is properly thought through, properly worked out, and introduced in the right way?

Do you know how it was introduced? It was tabled one day and it came in under urgency the very next day. It was rammed through the House under urgency. And then the Government referred it to a select committee, but it did not give the normal period of time on a particularly complex and controversial piece of legislation for those making submissions to put those submissions together and for the committee to properly consider the bill and analyse its shortcomings and its lack of safeguards. This legislation, in a word, is a shambles, and it is shown by the Minister’s act this very day in reversing a stance that her lobby-fodder MPs on the committee supported all the way through to deliberation.

It is serious that any legislation be handled in this way, but it is particularly serious when you have a piece of legislation that confers major powers on to a Government to intrude on the privacy of New Zealanders and to direct private companies as to how they should operate. This bill, for example, requires companies to notify the Government Communications Security Bureau (GCSB) about any procurement that they might make. And is the company expected to sit back and wait until it gets approval from the Government, whose time frame might be quite unreasonable and might hold up the process of the change that the network provider needs to make? This bill allows the Minister to direct industry to take actions or to desist from taking actions without the adequacy of the safeguards put into the English legislation dealing with security, where you at least had an advisory board where somebody knew the technical details, the implications, and the consequences of what the Minister was doing. Too often we have seen in this House that the Minister him or herself will not understand these technicalities or those implications. We saw that from the Minister of Education at question time today. We needed adequate time to analyse this legislation, but the Government insisted on ramming it through its first reading under urgency and curtailing the time that people had to make submissions and that the committee had to consider those submissions.

The other big worry about this legislation is that it might simply provide the mechanisms for the intrusion on privacy, but what it does is it actually implements a huge policy change made in a related piece of legislation, the Government Communications Security Bureau Act. That legislation was changed, also under urgency, by the Government in order to give this agency, for the first time in its history, the right to spy on New Zealanders. And it did so without even considering—

Hon Steven Joyce: You’re making it up.

Hon PHIL GOFF: —holding an independent public inquiry, which was the first thing, Mr Joyce, that the Australians did when they were introducing their legislation that gave powers to intrude on the privacy of individuals. They held an inquiry, and, by God, we needed an inquiry because this legislation and its associated bill came about because of abuse of power by the GCSB. They came about because there are not sufficient safeguards on how the GCSB exercises its authority. In our fraternal parliaments in Australia, Canada, and the United Kingdom, they do not put the Minister in charge of the agency on the committee that oversees that. They keep Ministers off. But we have our Prime Minister chairing the Intelligence and Security Committee, setting the agenda, and very rarely calling it together, and we call that a safeguard against the abuse of powers of the GCSB.

We opposed the Government Communications Security Bureau Act and therefore we oppose this legislation, which enables it to be implemented. I will remind the House that the Government Communications Security Bureau Act was passed on the vote, by the narrowest of margins, by two votes from two members who are widely regarded by the public as being discredited.

We have not got the safeguards, and we know from what is happening internationally that this sort of legislation needs proper safeguards. We have had the revelations from the leaks by Edward Snowden, the man who showed that the American National Security Agency was actually spying on hundreds of thousands of American citizens, not just citizens who had any association with terrorist or criminal organisations. Actually, it was the Government Communications Headquarters in the United Kingdom, revealed in the same leaks, that was spying on friendly allied countries. We need the safeguards in the companion legislation or this legislation will not do.

It is a fact that almost every submission before the Law and Order Committee on this legislation opposed it. Vodafone, Telecom, the Telecommunications Users Association of New Zealand, InternetNZ, Google, Facebook, Tech Liberty, the New Zealand Law Society, Microsoft, and Mega—every one of those agencies said that this is ill-conceived legislation that will not do what it is meant to do. Let me make this point: we had the officials admit to us that loopholes will prevent this legislation even doing what the Government members have claimed for it. There is a loophole whereby over-the-top providers like Skype—and more and more people are using Skype—are not covered by this legislation, and a loophole that says that small telecommunications companies are exempt. They are massive loopholes that professional terrorist and criminal organisations will use. We will not be catching the crooks, but we will be locking up in the data gathering tens of thousands of innocent New Zealanders, who will be spied upon and whose data will be collected.

In the last minute that I have—I think it is about a minute—I just want to say this. The submission from Google said that given the short time available on the bill it was unable to analyse it properly, but it did say that “The lack of transparency involved in the various processes under the Bill would likely raise public fears of unjustified intrusion into their privacy.” It said that the additional costs in time and the challenges imposed by the bill will discourage local and international entities from making new service offerings available in New Zealand, and also lead to existing agencies withdrawing services. This is bad legislation, introduced under bad process, and Labour is opposing it.

BRENDAN HORAN (Independent): I seek leave for my vote to be recorded in support of the earlier motion to refer the Telecommunications (Interception Capability and Security) Bill to the Law and Order Committee. In doing so, I acknowledge that the Greens support democracy by casting my proxy vote, and I regret that on this occasion I did not clearly communicate my intention to the Greens.

Mr DEPUTY SPEAKER: Just as clarification, the member cannot actually seek to go back and change the vote, but he can seek to have it recorded in the Journals of the House. Is that what the member is seeking?

Brendan Horan: Yes.

Mr DEPUTY SPEAKER: Leave is sought for that purpose. Is there anyone opposed to that course of action? There is no one. It will be so recorded.

IAN McKELVIE (National—Rangitīkei): Without security there can be no democracy, and, likewise, with no democracy there will be no security. It seems a little odd, I guess, that I have got to remind the Opposition or that I feel the need to remind the Opposition that the rush around the Telecommunications (Interception Capability and Security) Bill—in fact, the need to introduce this bill at all—was created in 2004 by some inept legislation put in place by the very Labour members who are criticising the bill we have in the House now. We have heard at least three senior members of the House criticising this bill this afternoon. Most of them spent most of the speech time they had talking about something quite contrary to this bill. This bill is a very simple bill. It updates existing provisions that were put in place, as I said earlier, by the Labour Government in 2004, it modernises the existing requirements for telecommunications companies to assist with interception under warrant, and it introduces a formal framework to protect network security.

I want to very briefly comment on one topic that was raised by the last speaker, Phil Goff. I want to briefly talk about encryption, because this bill does not and cannot insist on encryption services being provided when the encryption tools are held by an independent provider. The very best war stories and spy stories all contain most intriguing lines on code-breakers. I do not know what has changed now.

Finally, I just want to comment very briefly on what I thought was amazing advice that we had from a very competent team of advisers on what was a pretty technical bill for us to understand. I think the Law and Order Committee has done pretty well in getting through this bill in the manner it has and in getting it back to the House in the form it has. I also want to congratulate the Minister for Communications and Information Technology on her understanding of the bill and the way she has presented it to the House. Thank you.

Mr DEPUTY SPEAKER: I call Gareth Hughes—5 minutes.

GARETH HUGHES (Green): Kia ora. Ngā mihi nui ki a koutou. Kia ora. I rise to oppose the Telecommunications (Interception Capability and Security) Bill. It was around 7 years ago today that we saw masked gunmen on behalf of the New Zealand Government terrorise a community in New Zealand under the rubric of protecting New Zealanders, but all they did was terrorise a community and scaremonger amongst the New Zealand population. What we see 7 years on is a continuation of that Government approach, this time using online and internet communication technologies. I am proud to oppose this bill. It is a small contribution I will be making. I oppose it because I want to stand up for freedom, I want to stand up for Kiwis’ privacy, and I want to stand up for less State interference in people’s lives.

I remember when the last Government was in and we saw low-flow showerheads and efficient light bulbs saving Kiwis money. It was called the nanny State. Here we have the Government under the Government Communications Security Bureau Amendment Act and the Telecommunications (Interception Capability and Security) Act literally going down the country’s internet cables, through its fibre connections, and into its homes to intercept it. What we are seeing are interceptions on behalf of other Governments as part of our relationships with other “Five Eyes” network Governments. I am proud to be voting against this bill. It is bad law, it is badly drafted, it is being seen through a bad process, it is bad for Kiwis, and it is bad for our thriving information and communications technology sector.

First up, it is bad law. This bill, which is coupled with the Government Communications Security Bureau (GCSB) legislation, rewards the unlawful activities of our spies. What we saw after those Urewera raids was 85 Kiwis unlawfully spied upon. Instead of inquiring into what went wrong and trying to fix those mistakes, what this Government has decided to do is legislate to make right what was unlawful. What we see is the Government expanding its surveillance reach. We now see service providers included under that massive, big government under National. What we see in this law is interception capabilities being enhanced, and then we see on the network security side of this bill that information and communications technology companies now need to consult with the GCSB and get its sign-off for installing new kit, and they must be intercept ready.

It is badly drafted. I would like to quote from NZRise, the open-source software community of New Zealand. It writes that “The bill is currently drafted so broadly it creates huge uncertainty and therefore business and investment risk for anyone in the New Zealand ICT industry or considering entering it.” We see some improvements from the Minister for Communications and Information Technology, like the removal of clause 39, which would rule out things like Facebook Messenger and Google Hangouts, which many Kiwis use, because they use encryption technology. It was incredibly poorly drafted.

We are seeing this through a poor process. We are missing a crucial step, which is an inquiry. We need to find out what this Government got so wrong when we saw unlawful spying on Kiwis, so we can make it right. After all those cases of unlawful spying and after the Snowden revelations, we need an inquiry and we need a better process, and it is bad for our information and communications technology sector. What we see is greater uncertainty and greater Government involvement in what people invest in and install. We are going to see greater delays. We even see our information and communications technology companies say that they are going to have to choose between breaking either New Zealand law or US law. In fact, what we might see is those Kiwis choosing not to operate in New Zealand. We will be the poorer for it.

With the rise of cloud-based computing, we see real risks to the next frontier where New Zealand could see true, thriving growth. Just 2 days ago, we saw Rod Drury’s Xero raise $180 million in capital for his cloud-based accounting software. Using these new cloud-based tools, we can offer the world services. But what this Government has decided to say is “You need to do it with the GCSB signing it off.” It is going to stifle innovation and it is going to squash the potential of our information and communications technology sector, and that is why we are voting against it. It is a bad law, badly drafted, bad for our information and communications technology industry, and a bad process. That is why we are voting against it. Kia ora.

Hon MARYAN STREET (Labour): I also want to add my concerns to those that others have expressed on this Telecommunications (Interception Capability and Security) Bill. Other people have talked about the content of the bill, the flawed nature of the content, and the damage that it is likely to do for an innovative and expanding industry in New Zealand. I share those concerns, but they are not the concerns that I wish to elaborate on this afternoon.

My concerns are around process. My concern is that what we have seen with this piece of legislation—which was introduced in a hurry, which was referred to the Law and Order Committee for a truncated period of time, and which the Government is now seeking to dispose of this week through its second reading and Committee stage—is a complete disdain for process and for lawmaking in this country. Why it is particularly important in this respect is that this piece of legislation is a companion piece of legislation to the Government Communications Security Bureau legislation that was passed by a slim margin earlier this year.

The concerns around process are, for me, fundamental. We heard the start of a sermon a moment ago from a National Party speaker, Ian McKelvie, about the protection of democracy. I would say in addition to this that privacy is an important underpinning element of a democracy. What this bill does not do is get the balance right between the protection of security measures, which we on the Labour Party side of the House absolutely understand and recognise, and the need to protect privacy.

Individuals have a right to have their privacy protected in a democracy because otherwise they will not speak up. They will not be able to speak up for fear of interception and retribution and punishment of one sort or another. Whether it is the Minister for Social Development making a beneficiary’s private records public for her own point—for her own sake—or whether it is the selling of legislation to big business interests, this Government seems to have no regard for the protection of a democracy that is about individual liberties and responsibilities as well as collective ones.

Let me just elaborate on that a bit further. The points that concern me in this in particular are that this legislation was another opportunity—another opportunity lost—for the Government to stimulate a public debate about what our security systems ought to look like in the modern age, and how we can do that and still achieve a vibrant communications sector that could be allowed to contribute to the Government’s GDP.

What we have in this bill is the worst of all worlds. We have a capitulation to big business, because the Minister for Communications and Information Technology has come in with eleventh-hour Supplementary Order Paper 366—which is a defiance of process in itself—which deletes clause 39, the clause that was going to require overseas companies to comply with our legislation in a way that was not consistent with their own legislation.

So not only has this been badly done but it has been done badly. The process has been flawed from beginning to end. This Government apparently has no regard for the democratic health of this country. The Government has sold our industrial laws to Warner Bros, our gambling laws to Skycity, our democratic right to protest to the oil and gas industry, and this is just another capitulation in a hurry on a piece of legislation that ought to be protecting individual liberty and not restricting it.

JAMI-LEE ROSS (National—Botany): I commend the Telecommunications (Interception Capability and Security) Bill to the House.

CAROL BEAUMONT (Labour): It is a great pleasure to rise and take the spot that has been left by the National Party, which did not take one of its calls on what is a very significant piece of legislation, the Telecommunications (Interception Capability and Security) Bill. It is a bill that the Labour Party strongly opposes, and my colleagues, the previous Labour speakers, have outlined in great detail why we oppose it, starting with our leader, David Cunliffe, Clare Curran, who has done enormous work in this area, the Hon Phil Goff, and, most recently, Maryan Street. I want to follow those Labour speakers and just put on record again our concerns about both the content of this Telecommunications (Interception Capability and Security) Bill and the process around this bill.

First of all, this bill is problematic because it has added to the previous legislation, the Telecommunications (Interception Capability) Act 2004, a significant new component to the title, and that relates to security. What this bill is doing is facilitating the changes that the Government pushed through under the Government Communications Security Bureau Bill. That bill failed to provide enough protections for New Zealanders, and many people listening have followed both that bill and this bill very closely. As my colleague the Hon Maryan Street has said, the people who care about democracy and the people who actually care about civil liberties and about privacy have been following these bills very closely. So this bill also fails in that regard.

It involves a major expansion of the Government’s powers over network providers and the information provided through them. As the Hon Maryan Street has said, of course we are concerned, like other people, about security, but it has to be balanced, and this bill is not balanced and it does not balance protections for people’s privacy. That is what is so concerning. It is also concerning that the bill gives Ministers extraordinary powers. Given the behaviour of a number of Ministers—and the Hon Maryan Street referred to the behaviour of the Hon Paula Bennett, but there are other examples that have taken place of bullying by Government Ministers—we would be very concerned about Ministers opposite having these extraordinary powers. So these powers are likely to increase the risk of incursions. It significantly increases the role of the Government Communications Security Bureau (GCSB) overall and its role in decisions by network providers and the information that must be provided to it. Telecommunications companies are being required to make their networks interceptable and to consult with the GCSB on upgrades and technology suppliers.

Again, the Hon Maryan Street in her recent contribution has talked about this Government’s dependence on big business and its continued cronyism and its continued selling of legislation. This one has actually been quite interesting because this bill was strongly opposed by the major telecommunications companies, in terms of the risks that it places on their being able to continue to provide services in New Zealand. Of course, as we just heard last night, the Minister for Communications and Information Technology actually backed down and issued Supplementary Order Paper 366 to remove clause 39, which required overseas companies to comply. Again, the Government has been putting issues on to big business that we do not necessarily agree with, and it is yet another example of the Government complying with the demands of business. But does this Government actually listen to the concerns of individual New Zealanders as opposed to big business? We think not. There are so many examples of that. This is a Government that is completely out of touch with the concerns of New Zealanders. The National-led Government is not concerned about New Zealanders’ very rightful fear of incursions into their privacy, into their being spied upon.

Of course, we also know that the bill is shoddy. It is poorly drafted, and the Law and Order Committee is dealing with this. I want to acknowledge and commend to people the Labour minority report, which covers a lot of these issues, but powers and provisions were, in the Law and Order Committee’s words, “not clear or are too broad.” This is very important in a bill that actually has so much ability to undermine people’s privacy. To have a select committee saying that the powers that were being given were not clear or too broad is extremely concerning. So the select committee has made changes to try to limit and clarify powers and processes, but will there be further rushed changes from the Minister? Obviously there has been really poor drafting, pushing through legislation again. This is not a good way to make law. It is particularly not a good way to make law of such significance.

So just to really summarise, I guess, we are concerned that the balance between privacy and security has not been met in this legislation, that there is a significant expansion of powers, and that that is always something that should be very, very carefully dealt with. It is a companion measure to the Government Communications Security Bureau Bill. This is something, as I have said earlier, that New Zealanders are worried about, that a lot of people are following. I think that National underestimates that level of concern.

We agreed with InternetNZ’s submission, for example, that the challenge was to strike “the appropriate balance between addressing national security concerns without introducing a permission-seeking process that is too involved and uncertain to incentivise network operators to [innovate] and to support a competitive telecommunications market.”

Other concerns that we have raised are the cost implications. That is referring to submissions by several network operators. The case for expansion of powers has not been made. During the hearing of submissions Labour members consistently asked submitters whether they considered there was a case for the expansion of powers in this bill to the GCSB and to Ministers. Not one submitter agreed that there had been a case for the expansion of those powers. The committee was not allowed to hear submissions from any of the surveillance agencies—including the GCSB, the SIS, or the New Zealand Police—outlining the case for increased interception powers or expanded powers in network design and build. I think that is something that is also extremely troubling. Supposedly those agencies have reasons for wanting this expansions of powers. Surely to goodness that should be on record, and surely to goodness the select committee should be able to hear from them and question those agencies. The fact that the committee was not able to is, I think, very concerning for our democracy. As Maryan Street also said, there are a number of pieces of legislation and Acts of this Government that when you put them together show a complete and utter disregard for our democracy.

Just to finalise, I am standing here along with my four former speakers to say that the Labour Party strongly opposes this bill, and it will continue to do so.

The question was put that the amendments recommended by the Law and Order Committee by majority be agreed to.

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

Ayes 61

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

Noes 58

New Zealand Labour 33; Green Party 13; New Zealand First 7; Māori Party 3; Mana 1; Independent: Horan.

Question agreed to.

The ASSISTANT SPEAKER (Lindsay Tisch): The question is that the motion be agreed to. Those of that opinion will say Aye, to the contrary, No. The Ayes have it. [Interruption] The Ayes have it.

Carol Beaumont: Party vote called for.

The ASSISTANT SPEAKER (Lindsay Tisch): If you want to have a party vote, you must challenge me at the time, not when I am ready to move on. A challenge to my ruling has to happen at the time, not once I have announced the result. So a party vote has been called for, but in future I will not accept one.

A party vote was called for on the question, That the Telecommunications (Interception Capability and Security) Bill be now read a second time.

Ayes 61

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

Noes 58

New Zealand Labour 33; Green Party 13; New Zealand First 7; Māori Party 3; Mana 1; Independent: Horan.

Bill read a second time.

Bills

Maritime Transport Amendment Bill

Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill

Third Readings

Hon MAURICE WILLIAMSON (Minister for Building and Construction) on behalf of the Minister of Transport: I move, That the Maritime Transport Amendment Bill and the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill be now read a third time. The Maritime Transport Amendment Bill and the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill amend the Maritime Transport Act 1994 in order to protect maritime safety and to protect the marine environment. Amendments to the Maritime Transport Act will provide for local regulation of maritime activities, enable the implementation of four international maritime conventions, and make other miscellaneous changes to improve the clarity, effectiveness, and enforceability of provisions in the Act.

The Maritime Transport Amendment Bill transfers local regulation of maritime activity from the Local Government Act 1974 to the Maritime Transport Act 1994. The bill clarifies the maritime functions and powers of regional councils and harbour masters to regulate maritime safety and maritime-related activities in their regions and to manage port, harbour, and navigation safety. This consolidates local and national regulations of maritime activity into one statute. The bill introduces new measures that specify the maritime safety responsibilities of port operators and the related powers of the Director of Maritime New Zealand to intervene in the interests of maritime safety. These measures will support and complement the voluntary New Zealand Port and Harbour Marine Safety Code 2004.

The bill also updates arrangements for setting council fees and charges for maritime-related purposes and for local enforcement of maritime rules.

The bill also enables New Zealand to bring four international maritime conventions into full force: the 1996 Protocol to the Convention on Limitation of Liability for Maritime Claims 1976, the International Convention on Civil Liability for Bunker Oil Pollution Damage 2001, the Protocol Relating to Intervention on the High Seas in Cases of Pollution by Substances Other than Oil 1973, and the Manila amendments to the International Convention on Standards of Training, Certification and Watchkeeping for Seafarers 1978. The bill gives effect to the actual text of the Convention on Limitation of Liability for Maritime Claims 1976 as amended by the protocol to the convention of 1996. This simplifies the way that the legislation currently implements the limitation of liability regime. But, more significant, the amendments enable New Zealand to accede to the 1996 protocol, which approximately doubles the liability limit for maritime claims under the existing legislation. It also provides for future increases in the limitation limit to be given effect by an Order in Council. This will make it a simple process to implement the 51 percent increase in the liability limit that will become available to contracting States in June 2015.

The bill will expressly implement the requirement for ships to have bunker oil insurance in accordance with the International Convention on Civil Liability for Bunker Oil Pollution Damage. Shipowners will be required to have sufficient insurance to meet their potential liability under the increased limitation limits of the 1996 Protocol to the Convention on Limitation of Liability for Maritime Claims.

The bill amends the Maritime Transport Act to enable emergency intervention powers in respect of ships to be exercised in the event of incidents involving harmful substances other than oil. This will give effect to the Protocol Relating to Intervention on the High Seas in Cases of Pollution by Substances other than Oil.

The Manila amendments to the International Convention on Standards of Training, Certification and Watchkeeping for Seafarers include regulation of alcohol consumption by merchant seafarers. Seafarers carrying out safety, security, and marine environment protection duties will be subject to blood-alcohol limits of 50 milligrams of alcohol per 100 millilitres of blood or 250 micrograms of alcohol per litre of breath. This testing regime is based on the testing regime for motor vehicle drivers under the Land Transport Act of 1998.

The Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill transfers the regulation of a dumping and certain discharges related to the exclusive economic zone activities from Maritime New Zealand to the Environmental Protection Authority. In addition, the bill creates a new non-notified discretionary category to provide the Environmental Protection Authority with similar options to those currently available under the Maritime Transport Act for considering discharge and dumping activities. The new classification will also provide an appropriate level of oversight and discretion by the Environmental Protection Authority for activities that take place over a short period of time or are routine but still necessitate full regulatory discretion.

These bills will provide an updated and improved framework for maritime safety and marine environmental protection. They will also allow for commercial activity within the exclusive economic zone to be carefully managed, while ensuring that the regulation is proportionate to the scale and environmental effects of such activities. I commend these bills to the House.

MOANA MACKEY (Labour): Labour will be supporting the Maritime Transport Amendment Bill portion of this marine legislation, and we will be opposing the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill portion of this marine legislation. If I could start with the bill that we do support, the Maritime Transport Amendment Bill, the question would really have to be why it has taken the Government so long to pass this legislation.

When the Rena disaster occurred 2 years ago, New Zealand taxpayers were lumped with enormous costs and the risk of even more had the negotiations with the companies involved not been successful, because we had not ratified the international bunker convention. In 2008 the Transport and Industrial Relations Committee recommended to the Government that it ratify that convention as soon as possible, and it has taken until now, in 2013, for the Government to do anything about that. So due to this Government’s failure to ratify that convention, when the Rena crashed on the reef of Tauranga, it was liable to pay only $11.3 million of the total clean-up costs, which were more than $50 million, and it was New Zealand taxpayers who ended up picking up the rest of that tab. Had we ratified that convention, the total cap that we could have claimed back would have been lifted.

The Crown was able to secure $27.6 million through negotiation with the companies, but it should not have had to take months and months of negotiating to come to an outcome that would be achieved absolutely by right had that convention been signed. The cap would have been lifted and that $27 million would have been absolutely unquestionably provided so that New Zealand taxpayers would not have to fund that. The Government recently was saying that it was a good outcome and that we got what we would have got anyway. Well, it took a lot of money, a lot of time, and a lot of stress, particularly for those business owners around Tauranga, which did not need to happen and should not have happened.

We are pleased this legislation is finally passing, but I have to say that we have passed a whole lot of really dire legislation that this should have been ahead of. We have passed a lot of legislation that is not nearly as important as this Maritime Transport Amendment Bill.

The Minister Maurice Williamson, in his third reading speech, mentioned that this legislation sets a blood-alcohol level of 0.05 for ships, and my question to the Minister would be why not for cars as well, then? Why is the Government so absolutely adamant in its refusal to reduce the drink-driving limit from 0.08 to 0.05—

Hon Maurice Williamson: Anybody who drives their cars on the ocean will be caught.

MOANA MACKEY: The Minister says that it is because people do not drive cars on the ocean—people do not drive cars on the ocean. Well, that is one of the more lucid reasons I have heard for why the National Party is not supporting my colleague Iain Lees-Galloway’s member’s bill. Anyone who saw Seven Sharp last night—for those people who were not watching Minister Simon Bridges imploding on Campbell Live—saw that there was actually a really good item on Seven Sharp where a couple of staff members from Television New Zealand drank enough to get them to 0.05 and then to 0.08—[Interruption] This is in the bill. We changed the blood-alcohol limit from 0.08 to 0.05—

The ASSISTANT SPEAKER (Lindsay Tisch): Not for cars.

MOANA MACKEY: —for ships. What we are saying is that if it applies to ships, it should also apply to cars. What was clear was that even at 0.05 they were still significantly impaired. When they were doing a driving simulation, I think one of them killed a deer at 0.05 and then at 0.08 a pedestrian.

The ASSISTANT SPEAKER (Lindsay Tisch): Ships, not cars.

MOANA MACKEY: We are just saying that if it is good enough for ships, then it should be good enough for cars. It is completely lacking in any rational explanation as to why it should apply to ships but not apply to cars, especially when you see the death rate on our roads that alcohol causes. We are pleased to see this Maritime Transport Amendment Bill finally passing, but, again, I say that it should have happened a lot sooner.

The bit I want to focus on is the changes to the exclusive economic zone legislation. This is just yet another greasing of the wheels for industry from a Government that has no plan for regional New Zealand other than oil and gas exploration. That is all it has. That is all it has. So what it has done is consistently embark on a programme of weakening environmental protections, of locking the public out from having any say in what is occurring off their coastlines, and of arrogantly ignoring some very, very valid concerns that the public hold around the dangers associated with deep-sea oil drilling. Some of the depths that we are talking about now in New Zealand are not depths that have been seen around the world. I think that those communities have a right to have a say, through a process of issuing the marine consent under the exclusive economic zone legislation, about the concerns, to have those concerns acknowledged, and to have the Environmental Protection Authority actually have to consider them.

What you have now is out to 12 nautical miles—that is our territorial waters—that is where the Resource Management Act applies. The public do get to have their say through a submission process. The Government is trying to take that away, but, fortunately, it does not have the numbers to do that at the moment. We have a Resource Management Act process that is well tested. There are 20 years of case law behind it. There are appeals to the Environment Court on substance, not just on process, and there is a submission process where affected communities can have their say about what is going on. We think the Resource Management Act is a good piece of legislation, notwithstanding the changes that the Government wants to make to it.

Once you get to 12 nautical miles, we head into our exclusive economic zone. New Zealand does not actually have the right to exploit any of the resources there unless there is a regulatory regime in place, and that is what the exclusive economic zone legislation that passed late last year does. But, unfortunately, unlike the Resource Management Act, there is no ability for appeals to the Environment Court. There is very ambiguous language that has not been tested in the courts. We asked why we could not just pick up the well-tested language of the Resource Management Act, as an indication that we expected that with two regimes operating side by side in our ocean where the line that divides them is jurisdictional only, it would make sense to use similar language and similar processes so that the companies that currently deal with regional councils and our territorial borders in Taranaki know that, basically, the same standards are going to apply in the exclusive economic zone. I note that when the Taranaki Regional Council submitted on that bill, it said that, actually, it would be helpful to have more guidelines.

What we have is an incredibly laissez-faire piece of legislation, a very permissive piece of legislation, on our exclusive economic zone.

David Bennett: But you’re going to vote for it, though.

MOANA MACKEY: We voted against it the whole way through, Mr Bennett, actually, because, unlike you, we read the legislation. I think it is counter-intuitive to what most New Zealanders would expect. I think most New Zealanders would expect that, actually, the deeper you go out, the more rigorous the regulation. In fact, what we have in New Zealand is that the deeper you go out, the more permissive the regulation.

Andrew Little: It makes no sense.

MOANA MACKEY: From our perspective, that simply does not make sense, and it does not provide the environmental protections and those bottom lines that New Zealanders want to know are there if this activity is going to go ahead in our exclusive economic zone.

Depth is not the only factor. There is whether the area is seismically active. There is the geology of the area. There is the size of the actual reserve that might be discovered. There are a whole lot of things that need to be factored in. What we need is robust risk analysis in our exclusive economic zone, and this bill does not provide it. When a number of these concerns were raised at the select committee, the Minister of Energy and Resources at the time, Phil Heatley, spoke to the people in Kaikōura who were very concerned that there is a very deep trench, about 100 kilometres off the coast of Kaikōura, where exploration work is going to start this summer. They were very, very concerned about the permissive nature of the exclusive economic zone regulations. They were very concerned about the Environmental Protection Authority’s capability to actually issue these marine consents. This is an organisation that does not have any internal investigative capability, so it is going to have to go out to look for it. What did Minister Heatley say to the people of Kaikōura? He said: “Don’t worry. You’ll get to have your say during the submissions process for the marine consents. You will get to have your say during the submissions process for the marine consents.”

David Bennett: Talk about the real bill.

MOANA MACKEY: David Bennett really does not even understand what is in this bill. This is actually in the bill, Mr Bennett, that you are about to vote for. You are taking away—taking away—the right of people in this country to have a say over exploratory drilling by the creation of this new discretionary non-notified category. Mr Bennett, Phil Heatley promised the people of New Zealand that exploratory drilling would be notified, and this legislation creates the very category that is going to take away that right. Now you have an Environmental Protection Authority process where it is not going to have the benefit of the submissions that come from individuals, from NGOs, and from independent technical experts who take an interest in this thing. It will no longer have that. It has no internal investigative capability. The National Institute of Water and Atmospheric Research (NIWA), which is the organisation that the Environmental Protection Authority will go to to do it, has been contracted to the oil industry. I do not know whether NIWA, in that contractual arrangement, is actually also able to provide advice to the Environmental Protection Authority. It may well be that it cannot. The very organisation that is expert in this country has already been contracted to the oil industry because the Government cut its funding and told it that it had to go out and get those commercial contracts. Where is this information going to come from that the Environmental Protection Authority is going to be making incredibly important decisions on?

As we saw on Campbell Live last night and as we have been pointing out consistently, we do not have the capability to respond if something goes wrong in the deep sea. We have three vessels. They are 8 metres long each. One is in Northland, one is in Auckland, and one is in Picton. When they are going at top speed, at full capacity, they go at 12 kilometres an hour. The idea that they are going to be able to get out to the trench off the Kaikōura coast is absolutely not true, and we will be—

The ASSISTANT SPEAKER (Lindsay Tisch): I am sorry but the member’s time has expired.

DAVID BENNETT (National—Hamilton East): That was a very poor speech from that member, Moana Mackey. She has a very limited understanding of the legislation arising from the Marine Legislation Bill, and it really shows why the people in the area that she purports to represent do not vote for her. They know that she does not understand the issues that are important for the people in her area. There were many things that were said in that speech that were just not true. It is not something this Parliament needs. We need concise general debate, and we do not get it from that member very often.

But this is a good piece of legislation. It covers a few major areas that needed some reform. Those reforms were done in a very good way through the Transport and Industrial Relations Committee, and I would like to commend the members of the select committee for their work in that area. I think we got some pretty good work from all members. I think the Green Party members were quite happy with some of the discharge rules that were changed, to be taken into it.

Moana Mackey: That’s because you added the EEZ stuff after the select committee.

DAVID BENNETT: That member should be quiet for a little while and she might learn something.

This is good legislation. It is something on which we have worked hard with regional councils as well because they have an important role in this area. It is something that is not easy. It is setting up structures and procedures, but they are necessary and are in the best interests of our marine environment, our transport sector, and the wider economic gains that can be made from all those sectors coming together.

We look forward to the legislation passing today, and thank you very much to all those who were part of the process. Thank you.

IAIN LEES-GALLOWAY (Labour—Palmerston North): I rise to speak to these two bills, the Maritime Transport Amendment Bill and the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill, that previously made up the Marine Legislation Bill. Labour wants to make it clear that although we support the Maritime Transport Amendment Bill, which has come from what was originally Part 1 of the Marine Legislation Bill, we are opposed to the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill, which falls out of Part 2 of the original bill. My colleague Moana Mackey has gone into considerable detail about why Labour is opposing the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill, so I aim to discuss some of the matters involved in the Maritime Transport Amendment Bill.

The purpose of the Maritime Transport Amendment Bill is essentially to implement a number of international treaties that, really, the Government has taken an awfully long time to sign up to. This goes all the way back to 2008, prior to the 2008 election. The Transport and Industrial Relations Committee during that term of Parliament recommended to the Government that it implement the various conventions that this bill implements. The select committee took its time to consider the implications of the International Convention on Civil Liability for Bunker Oil Pollution Damage and the changes to the Convention on Limitation of Liability for Maritime Claims. All the hard work had really been done by that select committee. It made its proposals to the Government, and the then Labour Government was ready to accept those proposals and implement them in legislation.

We then had an election, the Government changed, and it fell to the National Party to carry on the work that had already been carried out.

Carol Beaumont: Five long years.

IAIN LEES-GALLOWAY: Sadly, the National Government failed to implement the recommendations of the select committee, and sat on this legislation for not quite 5 long years but long enough, in fact, for the Rena disaster to occur before this legislation was implemented. Had the Government been up to the task, had the Government been on to it, and had it been prepared to prioritise the safety of our waters around our shoreline—it required nothing more than to follow up on work previously done—then New Zealand, the New Zealand Government, and the New Zealand taxpayers would not have been liable for the millions of dollars of costs associated with the Rena disaster. In fact, the costs to the Crown were over $50 million.

Carol Beaumont: How much?

IAIN LEES-GALLOWAY: $50 million. Had this legislation been implemented before the Rena disaster, then the Crown would have been liable to pay around about $11.3 million. That is still a significant sum, but it is considerably less than the $50 million that it has cost us. That cost was absolutely avoidable. It was nothing more than negligence and, frankly, laziness on the part of the Government that meant that this legislation was not implemented in time. After months of negotiation, the Crown was actually able to get a reduction in those costs. They did end up being less than $50 million. But, again, the real cost that the Government should have borne was significantly less.

It is good news that this legislation is being passed, but a bit behind the time. But we know that in the future, should another disaster like the Rena occur—and of course we hope that it will not and we hope that the Government has actually taken the steps to help ensure that a disaster like the Rena is not able to occur again or is less likely to occur again—then taxpayers will not have to carry the burden. It will fall where it ought to, which is with the shipping company that owned the vessel—a foreign company. Once again, it is not unusual for this Government to be doing things that take the burden of cost off large foreign multinationals and place it on the New Zealand taxpayer. I am not for a second saying that it did it deliberately this time. There are plenty of other examples where it did do it deliberately, but it was not deliberate this time. It was just basically laziness and negligence on behalf of the Government.

This bill actually does something else that is incredibly positive. It sets the blood-alcohol limit for seafarers in charge of a marine-going vessel at 0.05. Why does it do that? Well, again, this is about signing up to international conventions. This is about following international best practice. I want to congratulate the Government on promoting legislation that sets a blood-alcohol limit of 0.05, because we know that that is the medical definition of intoxication. Once somebody has a blood-alcohol level of 0.05 or higher, they are not capable of good decision-making, they are not capable of operating a marine-going vessel or any form of machinery, and they are not capable of operating a vehicle on the road.

It would be an excellent thing for New Zealand to adopt a 0.05 limit not just for seafarers but also for drivers on the road, because we know that drink-driving is one of the key causes of serious road crashes in New Zealand. The evidence is incredibly strong. It does not matter what piece of evidence you look at, the evidence supports what this bill does, which is to reduce the alcohol limit for seafarers from 0.08 down to 0.05. If we look at the number of incidents that making this change will impact, it is around about 20 incidents a year. So it is helpful, but it pales in comparison with the impact that we could have if we applied the 0.05 limit included in this bill across a range of other activities, including drink-driving. Around a couple of hundred people die on the road every year. That itself is strong evidence of why we should support the 0.05 limit in this bill. A limit of 0.08 for adults allows seafarers, drivers, or anybody else for that matter to have around about six standard drinks in an hour. In fact, I saw a report just last night where someone consumed eight beers in around about an hour and a half, and they were still below the level of 0.08. I think we would all agree that nobody should be in charge of a marine vessel when they have consumed eight beers. That is why we are so much in support of this initiative to reduce the limit.

The other thing for seafarers is—because I know that seafarers have downtime on the ship; there is not necessarily a lot to do, and heading to the bar is one of the favoured activities—because they know they are coming on to watch shortly they aim to get to about 0.079 and to come in just under the limit. Once they get over 0.05, they will find it very difficult to judge exactly how intoxicated they are. Often, seafarers, like drivers, will find that they are actually well over the limit because they have lost their ability to judge how intoxicated they are. Lowering the limit for seafarers will ensure not only that we eliminate those seafarers who are between 0.05 and 0.08 but also that we reduce the number of seafarers who are extremely intoxicated when they are in charge of a marine vessel. So we on this side of the House congratulate the Government on promoting legislation that does that. We believe that 0.05 is the correct limit for anybody who is operating a vehicle or machinery that has the potential to cause harm to themselves or to other people, should their intoxication end up causing an incident of any kind.

So with that I just want to reiterate that Labour is in support of the changes to the maritime transport legislation, but we will oppose the changes to the exclusive economic zone legislation.

GARETH HUGHES (Green): Kia ora, Mr Assistant Speaker. Ngā mihi nui ki a koutou. Kia ora. I rise to support the two bills, the Maritime Transport Amendment Bill and the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill, formerly known as the Marine Legislation Bill. What we are seeing here is that 2 years on from the Rena disaster, the Government is finally getting round to signing up to two of the international treaties that we should have signed up to an awful long time ago in order to protect the taxpayer. What we saw when that container ship hit the Astrolabe Reef was that New Zealand taxpayers were unprotected. Sure, we saw that the environment was unprotected, and we saw how Maritime New Zealand had to scramble like a headless chook to deal with that oil spill. We saw two and a half jumbo jets full of oil spill response equipment fly into the country. We saw how woefully unprepared we were. We saw those three skimmers, more akin to dinghies, which were raised in question time today. We saw how Maritime New Zealand was not prepared to deal with the public when it came to oil spills. What we saw was New Zealand volunteers doing what they do best. Even though the Government was not going to act and was sitting in a corner not knowing what to do, Kiwis just did it themselves. They went out on the beaches and they picked up those oil blobs.

So it is good that 2 years on we are finally getting round to something we should have done a long time ago. Signing up to these international conventions allows us to effectively double the amount we can claim in order to protect the taxpayer when big ships have problems spilling oil. Obviously, there is a liability limit regime internationally, and when the Rena hit the reef, what we found was that we could get a maximum of only $12 million. We can increase that now to almost $24 million - plus, which is good, and it might even increase in the future.

What we know is that taxpayers had to come to the party to the tune of tens of millions of dollars to deal with that oil spill. I think that everyone in this House and every New Zealander could agree that the taxpayer should not have to pick up the tab when corporations damage our beautiful environment. Corporations, rightfully, should pay when they cause a mess or when they cause a spill. They should pay to clean it up. But that is not what we saw. What we saw was the Oil Pollution Fund massively depleted. In fact, we saw it drop from $12 million to only $3.4 million. I understand that it is even less than that at the moment.

The taxpayer is threatened by an accident happening. Of course, what we know with marine activities in New Zealand is that accidents can happen. Obviously, they can be avoidable. We can put steps in place to avoid accidents occurring, but they do happen, and, frankly, we are unprepared if we were to see another big spill of oil entering our environment.

This Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill effectively does three things. It amends the Maritime Transport Act, it amends the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act 2012, and it accedes to these international treaties. There were some improvements in the legislation, which the Greens have welcomed, but you have got to admit what an absolute shambles it is that the Government is having to amend the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act only a year after it was passed. At the time, both the Labour Party and the Green Party strongly criticised the Government for its process over that Act. I believe that it was quite simply an “Easy Drilling Act”. That is what it was designed to do. That is what it was drafted to achieve, and that is what the oil industry was asking for. I think it is an absolute shambles that we are having to amend that legislation, which was passed only recently, so soon in this House.

What we are seeing are amendments to the discharge and dumping regime under the exclusive economic zone. It is good to be improving that. There is now a guarantee that fracking at sea will be included. So we welcome those changes.

It is an absolute shambles. Sadly, what we saw through the Committee stage of this bill is the new consent category accepted by this Parliament. The Government has introduced a new consent category that it had not drafted into law last year. The new category, non-notified discretionary, is quite simply a clause that gives us no say. We know that exploratory drilling is the riskiest phase of oil production. We know that it was exploratory drilling that caused the Deepwater Horizon disaster, which made the Rena look like a puddle of oil. There were 300 tonnes spilt from the Rena versus 600,000 tonnes for the Gulf of Mexico spill. Yet what we see from the Government is that on the riskiest phase—the phase that has caused the largest environmental catastrophe to result from oil drilling—we will have no say. Yet, incredibly, you get the Minister Simon Bridges on television, out of his depth, arguing aggressively that Kiwis should not get a say. On two hands, he says that the Government is doing something that is so popular that all Kiwis are demanding it and that there is huge, widespread support for it, even though he cannot think of even a single person in the town of Kaikōura who supports the Government’s plan.

So the Government says that on one hand there is massive support for deep-sea drilling, yet on the other hand it says that no one in the country is going to get a say. I find that contradictory, I find it ridiculous, and I think that when you look through the veneer, what you see is that this Government is deeply scared of what New Zealanders think about oil drilling. New Zealanders want to protect their beaches. To be able to build a sandcastle with your children and put out the cray pot with your kids—that is a Kiwi right. Being able to trade with whale-watching, as they do in Kaikōura, and to have a thriving aquaculture fisheries tourism industry—this is what our country trades on, and we are seeing this Government put it at risk and not give Kiwis a say. That is why this legislation amending the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act is a total shambles. It is unfair, it is secretive, and it is taking away the Kiwi right to have a say when potential activity threatens your environment.

Despite that, though, what we are seeing are some positive moves in the legislation formerly known as the Marine Legislation Bill. We want to see the environment protected. We want to see the taxpayer protected. These points are just one little step we could do to protect the taxpayer. A year ago, on the anniversary of the grounding of the Rena, I presented a 10-point checklist that the Government could do, with positive, common-sense solutions to protect the taxpayer. What we should be doing is increasing the Resource Management Act maximum corporate penalties, because $600,000 is a joke when you see the cost to the taxpayer from the Rena. We need to be building up Maritime New Zealand’s Oil Pollution Fund. We need to be building up its budget, and I proposed a good solution for that, which is to use the petrol levies paid by boaties. That would give Maritime New Zealand an extra $20 million - odd. I think it is fair that boaties should pay for protecting the waters, because that boatie money is essentially just going towards new motorways under National. What we should be doing is doing things that business and unions support, like having a rapid response, multipurpose vessel to protect our waters. Those three skimmers are not enough. We need to be building up the expertise in Maritime New Zealand. But, ultimately, what we have to do is not risk our environment from a catastrophic oil spill.

What New Zealanders want, what people in Kaikōura want, is a guarantee from the industry and the Government that we will not see a spill. The Government and the industry cannot give that guarantee. Also, the Government and the industry cannot guarantee that they could respond to a big spill. I find it deeply shocking that this Government has nominated only 5,500 tonnes as its oil spill response capability. The Gulf of Mexico spill was 600,000 tonnes. This Government says that it has no sub-sea oil response capability. This Government says that our capping stack technology to deal with a deep-sea blowout is there, it is available, but the only problem is that it is in London. We see a massive percentage of the oil spill response equipment stored in Singapore.

What we need to be doing is putting in place common-sense steps to protect the taxpayer from accidents when they occur, but the most effective thing we could do to make sure that oil does not hit our beaches and that oil drilling does not ruin that Kiwi tradition of being able to play on a beach with your kids and catch a fish safely—the best way to assure that; the only guarantee the Government can give—is if we stop deep-sea drilling. So although we are supporting this legislation, we are going to keep fighting the Government’s deep-sea “drill it, mine it, frack it” agenda in this House, on the streets, and online. We are going to keep mobilising. We are going to send a strong message to those companies, as we did with Petrobras and as we saw with the Canadian frackers Apache. We are going to send those companies the message that they are not welcome in New Zealand.

New Zealand’s future, New Zealand’s jobs, and New Zealand’s prosperity are going to come from clean energy, and it is clean energy where more net international capital investment is going. It is clean energy that China, Europe, and America are calling out for. Clean energy is our future. There are going to be more jobs, more taxes that stay in New Zealand, and more long-term prosperity. When I talk about wanting a richer New Zealand, we are not going to see it from hoping that someone finds something at the bottom of the sea and does not leave too much of a mess and that we can clip the ticket as those profits are exported. A richer New Zealand will come from our strengths. It will come from our innovation. It will come from looking to the future. The future is clean energy. That is where the Green Party focus is going to be, and that is where a Green Government is going to provide leadership and attention.

So although we are supporting this legislation, we are presenting a vision of oil-free beaches, a sustainable economy, and a richer New Zealand. Kia ora.

CHRIS AUCHINVOLE (National): It is a great pleasure to rise to speak on the third readings of this legislation, the Maritime Transport Amendment Bill and the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill. I will be brief because I think this legislation is, in fact, so good that it does not really need the embellishment of saying too much about it.

The legislation underlines one of National’s consistent purposes and missions. It shows a close analysis of the underlying, fundamental structures of the industry that is under examination. It has provided a close dialogue with industry leaders, Government experts, and the invested members of the public. It shows a strategic adjustment that will increase the communication, efficiency, and accessibility of, in this case, the marine sector.

We have just heard all the apprehensions and fears that are embodied in the Green view of this particular piece of legislation. I would, on the contrary, like to commend this legislation to the House in recognition that marine regulations and mariners carry our country’s wealth. They carry our exports to market and bring our imports in through seaports using the regulations that are legislated for in this House. That is 49 million tonnes of product coming through our ports—49 million tonnes a year—at a value of $75 billion. Good marine legislation has always been critical and crucial to New Zealand. It is crucial to New Zealand and will always be crucial to New Zealand. I commend this legislation to the House. Thank you.

ANDREW WILLIAMS (NZ First): I take a call on behalf of New Zealand First on the legislation before us, the Maritime Transport Amendment Bill and the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill. We will be supporting this legislation through its third reading. The New Zealand First Party does see merit in many aspects of the legislation, but, as other speakers have said today, we are somewhat disappointed that it has taken this amount of time to come to this point of the third reading. One does wonder whether if this had been enacted a number of years ago, if the safeguards and the penalties and the legislative requirements laid down in this legislation had been in place before the Rena disaster took place, we would still be looking at a wreck on the reef off Tauranga.

This legislation basically tidies up a lot of areas and moves things in the Maritime Transport Act across to the Environmental Protection Authority now that we have the exclusive economic zone—the 200-mile zone off our shores. So it does move legislation around to fall under different places of authority that are more appropriate for the administering of the zone. It moves some of these matters from the Local Government Act to the Maritime Transport Act in order for ports, harbours, and general maritime safety to be administered under the Maritime Transport Act, rather than that being the domain of local government in many areas where local government is perhaps not the appropriate authority to have the overall national authority over the legislation in relation to, particularly, maritime safety and ports.

It also doubles the penalties in other areas, which is a good thing. It is sending the very strong message in doubling those penalties that New Zealand is going to seek serious consequences for and compensation from those who would come with vessels, with ships, or with any other craft and potentially cause damage to our environment. It allows the Government to intervene, through various agencies, on the high seas in the case of harmful substances other than oil being discharged. Again, where there is a situation of leaks or discharges, or of a vessel carrying containers or a cargo that has potentially toxic substances that may come adrift, the Government has the legislation in place under these bills to intervene. The legislation will also increase the penalties on shipowners, and also on the ships themselves, in terms of bunker discharge. Again, that is a good thing, because there is a huge risk. Many of these vessels carry very large volumes of bunker oil, and, again, this country missed out on a great deal of compensation over the Rena disaster because this level of penalty was not in place.

In terms of moving over to the Environmental Protection Authority, which is now in place, there is merit in much of that, in that when it comes to areas such as the discharging of harmful substances such as radioactive waste, it prohibits the dumping of toxic or hazardous waste, and it restricts the dumping of any other sort of waste or the incineration at sea of waste or any other matter. That, therefore, does very much now come under the Environmental Protection Authority, under the exclusive economic zone. We are looking at something like the fifth-largest exclusive economic zone in the world, and our continental shelf goes out a great distance. Therefore, the Environmental Protection Authority will be charged with ensuring that any such hazardous waste will certainly be covered under this legislation.

It is, again, disappointing that we have to relook at the exclusive economic zone legislation. I sat on the Local Government and Environment Committee, which looked at it less than a year ago. It went through a very, very extensive submission process in terms of the importance of the 200-mile limit, from all sectors within New Zealand, from all over New Zealand. So it is somewhat disappointing again that the Government has dropped the ball on this in not picking up some of these aspects in the first place, when that very, very weighty piece of legislation was first brought through the House and through the select committee. However, it is better late than never. We do see that there are still areas here that must be well scrutinised. We are living in a situation now where there is great risk to our environment in terms of our harbours, our ports, and our shipping movements around the country, and in terms of general marine activities on such a large coastline. So it is important that this legislation is well monitored, and that those who are given the authority as a result of passing this legislation in this third reading do very much respond to what will be provided to them in terms of the tools and the tool box to ensure that New Zealand’s environment and coast are protected.

Also, in terms of maritime safety, there are many aspects in this bill that improve aspects in maritime safety, including offences where seafarers may be caught intoxicated when in charge of vessels on the coast. Again, that is a very, very dangerous situation, like any public transport situation. But in terms of a large vessel where there is found to be intoxication, they can be fined up to $10,000, or 12 months’ imprisonment. Again, it sends a strong message that it will not be tolerated—intoxicated seafarers being masters or, indeed, in charge of vessels. So New Zealand First will be supporting this legislation, and we commend it to the House.

Dr CAM CALDER (National): It is a pleasure to rise and take a brief call on the legislation arising from the Marine Legislation Bill, which enjoys widespread support across the House. That is not surprising, because, of course, trade is our lifeblood, as has been so eloquently pointed out by my colleague Mr Auchinvole.

The Marine Legislation Bill was an omnibus bill that amended the Maritime Transport Act 1994 and the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act 2012. The significant amendments that the legislation arising from it makes revolve around changes to the oversight of port, harbour, and navigation safety; implementing international maritime conventions and protocols; changes relating to the making of maritime and marine protection rules; and transferring the regulation of the discharge and dumping of waste.

We as a Government are committed to building a more competitive and productive economy. This legislation highlights our commitment to creating strong and sensible legislation that works. It will provide more certainty around the laws involved, as well as improving safety enforcement practices and environmental protection. I commend the legislation to the House.

Hon RUTH DYSON (Labour—Port Hills): That was indeed a brief call from Dr Cam Calder. In fact, I do not recall ever having heard a speech from that member that had so few words in it. I was quite disappointed, actually, because his contributions to the House are usually very, very interesting.

Hon Maurice Williamson: Why don’t you see if you can beat him with even less?

Hon RUTH DYSON: That Minister is no longer the Minister of Transport, is he?

Hon Maurice Williamson: No.

Hon RUTH DYSON: No, so I will not bother responding to that. It gives me great pleasure to speak in this third reading of the legislation arising from the Marine Legislation Bill. Before I get on to the substance of the legislation, I want to make just a brief comment in regard not to the member who just resumed his seat but to the National member who previously contributed to this debate, Chris Auchinvole, who in the recent parliamentary adjournment announced that he was not seeking re-election. I just want to take the earliest opportunity to say that he has made many substantial contributions in this House in a way that I think should inspire others and in a way that sticks to policy issues rather than individual personal attacks. I think he has made some very thoughtful contributions. He almost beat Maurice Williamson in his contribution on the Marriage (Definition of Marriage) Amendment Bill. It was a bit neck and neck at one stage. His contribution will be missed by me and, I am sure, many others in the House.

Hon Maurice Williamson: Did you say we were neck and neck?

Hon RUTH DYSON: Pardon?

Hon Maurice Williamson: Did you say that Mr Auchinvole and I were neck and neck?

Hon RUTH DYSON: That is correct. The legislation that we are discussing, the Marine Legislation Bill, has been split into two bills. The first bill is the Maritime Transport Amendment Bill and the second one is the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill. In regard to the first one, the Maritime Transport Amendment Bill, I am very pleased that Labour is able to support this bill. It is puzzling, though, to figure out why a bill that is so straightforward and in many respects without controversy, where, I think, perhaps the unanimous support of the House has been indicated and where it does such important things in terms of the protection not just of our maritime safety but also of our taxpayer base, has taken so long to get through. I am sure that if the Hon Maurice Williamson was still running this portfolio, it would have been well and truly done and dusted. I can remember in previous Parliaments the Hon Maurice Williamson ramming legislation through the House because it was so important to get it through in a hurry. We discussed Plimsoll lines during debate on that legislation a number of times. I remember the member the Hon Maurice Williamson waving white handkerchiefs from his position when he was taking the Committee stage of that debate, because he was so sick of hearing about Plimsoll lines. But, actually, he had a really strong understanding and commitment to the issues, and I think that is what is obviously missing in regard to the lack of leadership shown by the Hon Gerry Brownlee in steering this legislation through the House.

For goodness’ sake, it has taken years. In 2008, at the time of the election, this legislation, with a little bit of addition, was pretty well done and dusted by the last Labour-led Government. It was ready for introduction and progress through the House, and now, in October 2013, we finally see it getting to the last stage. It certainly could have and should have been passed some time ago. It is a bit of an indication, really, of the lack of management—not just the lack of vision but the lack of management—from this Government of the legislative process. Of course, that is reflected in the lack of support of our citizens and in the management of our country, as well.

The primary part of this legislation is in regard to the conventions that it ratifies—the conventions that were signed prior to the 2008 election. If the Government had got on with the legislative work that we are doing now, we would never have got into the difficulty that we got into with the Rena owners. The taxpayer base would have been protected, and I am sure that every National Party member would be happy going up and down the country saying that National is the party that is interested in protecting the taxpayer and ratepayer base of New Zealand. But in regard to this very simple piece of legislation, where there is no political opposition and lots of good reasons for supporting it, National left the taxpayer dangling. We ended up with a taxpayer bill of over $50 million as a result not of the Rena running aground but of the National Government not implementing this legislation, which would have given us the base for clear liability and for putting the cost where the liability occurred. Because this Government, the National Government, had not progressed this legislation, New Zealand taxpayers ended up with an unnecessary bill of $50 million. So thank goodness we are now at last getting this legislation passed. But in regard to the taxpayer debt on the Rena, it is too little and it is too late.

The Crown did, of course, negotiate more than the original liability, but that negotiation in itself cost a huge amount of money. We cannot just send in people who have got nothing better to do with their time to negotiate with the people who own these ships that have run aground and who are desperate to hold on to their money. We need skilled negotiators, and they cost the New Zealand public a lot of money.

I would have loved to hear an apology from one of the National members contributing to this debate—an apology to the New Zealand ratepayers for wasting $50 million of our money, which could have been much better spent on any number of activities that we know are in need within our own communities. But, no, instead, the Government had other, more important priorities—to, what, sell State assets, Mr Ross? It was something important like that. Or perhaps to stop the right of New Zealand families to take discrimination cases through the proper legal process in New Zealand if they are caring for family members. That is another thing that the Government gave urgency and priority to and put ahead on the legislative timetable, so this legislation has been languishing for the length of time it has. I would like to hear an apology from the Government to the taxpayers and ratepayers of New Zealand before the end of this debate. This legislation was actually ready to progress.

David Bennett: Why didn’t you do something when you were a Cabinet Minister?

Hon RUTH DYSON: I cannot remember what Mr Bennett was doing in those days, but he was doing a lot more than he has done recently.

Carol Beaumont: Five long years, Mr Bennett—5 long years.

Hon RUTH DYSON: Five years, and we are only getting to this legislation in October 2013. It was ready to progress. The member would have known that if he had done any homework, which does not seem likely from his minimal contribution. He would have known that.

In regard to the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill, it is very disappointing that once again we have legislation that has so much potential and yet delivers so little. The legislation amends the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act. That legislation itself was so weak. It was very recently passed by this Parliament, and yet we have amendments to it already. This legislation was promoted as being the protection for the environment that was lacking in our legislative framework. I admit there is a gap there that needs filling, but this legislation does nothing at all to protect the environment.

We know that the Ministers who are driving this agenda are staunch defenders not of the environment, not of health and safety, and not of security of our pristine marine areas but just of the drilling companies. We heard the Hon Simon Bridges, in his contribution, yelling at John Campbell last night in an extraordinary performance where he just repeated over and over and over again the lines he had been given. That was not just dismissive of John Campbell—I suppose when you put yourself in a position like that as a journalist and an interviewer, you may expect pretty robust debate—but actually offensive to the people of Kaikōura, the people who for the first half of that programme expressed their high levels of anxiety and their lack of trust in the National Government, the Government that, actually, those very same people had voted for. The very people who voted for Colin King to be their member of Parliament are now saying that they do not trust the National Government. They will look at this legislation, and their fears will be realised.

So, with reluctance, we are opposing a wasted opportunity to improve protection of our exclusive economic zone, and certainly supporting the Maritime Transport Amendment Bill.

SIMON O’CONNOR (National—Tāmaki): As I have been listening to the speeches from the Opposition on the Maritime Transport Amendment Bill and the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill, I have been reminded of Hemingway’s book The Old Man and the Sea and the marlin that just goes round and round and round. Although the rhetoric, particularly from the Labour Party, is not going to win the Nobel Prize in Literature, I suspect that some of the fiction from the leader, Mr Cunliffe, might.

This is good legislation. The Government will not apologise for any elements of it. We are proud of the legislation. Those of us on the Transport and Industrial Relations Committee have worked hard, and I commend the legislation to the House.

The ASSISTANT SPEAKER (Lindsay Tisch): The Hon Maryan Street—5 minutes.

Hon MARYAN STREET (Labour): Yes, it is a split call. The fact that none of the members opposite on the Government benches can muster more than 20 or 30 seconds to speak on the Maritime Transport Amendment Bill and the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill, just as they could not on the one before—

Carol Beaumont: Tragic.

Hon MARYAN STREET: —is absolutely tragic. It is something that demonstrates that they cannot justify their own legislation. They cannot justify why this House should be passing legislation of this kind. In the nearly 3 hours since question time, this has been their contribution. They want just to swing votes through on the numbers and never mind the justification.

I want to speak to the part of the former Marine Legislation Bill that is now the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill. I wish it were. I wish it were about environmental effects. The trouble is that, once again, this bill amends very weak legislation around the exclusive economic zone that has done little to protect the environment. Although I acknowledge that there is work that needs to be done in that area, the work that this Government has done is not going to protect the environment. Given that the Government is now considering making oil and gas exploration non-notifiable under the Resource Management Act, and the fact that it has passed legislation banning protests at sea, in order to advance the oil and gas companies’ interests, it is absolutely clear that it has no interest in maintaining the environment. So the weakest possible legislation it can get away with, with its slim majority, is what it is putting up.

Not only was the legislation weak to start with but now we have a shambolic process. The Government, as with other pieces of legislation, brought this exclusive economic zone legislation to the House just a month ago, with 37 pages of amendments, and now we have the Government trying to amend something that it only recently addressed. It is hard to imagine just how a piece of legislation might be amended to be even less effective than it was before, but this shambolic approach to matters that are of not only interest but importance to the environment that our few little islands exist in shows that the Government has no regard for process, content, or anything that might protect New Zealand’s environmental interests ahead of the economic interests of offshore investors.

So Labour opposes the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill, although we are supporting the other part of the legislation, the Maritime Transport Amendment Bill. The fact is that when we look at the legislation here apiece, whether it is the Crown minerals legislation, the Resource Management Act, or marine legislation, we can see that the Government is working to further the interests of the oil and gas industry or anybody who might be able to make a buck out of the environment without protecting it. So this legislation has to be seen in the context of other pieces of legislation, and this Government has to go down in history as the one that has protected the environment the least. Thank you.

DENISE ROCHE (Green): I rise to take a call for the Greens on these two pieces of legislation, the Maritime Transport Amendment Bill and the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill. Our position is that we will be supporting this legislation. We do have some concerns, particularly about the amendments to the exclusive economic zone legislation; however, I will talk about that in a minute.

Our position is that we believe that this legislation does not really go far enough in protecting the waters in our economic zone or actually protecting New Zealand taxpayers from paying the full costs of potential spills. Other speakers have already talked about the Rena and how this legislation should have been in place earlier in order to protect the taxpayer from paying the full cost of that clean-up.

We do support legislation outlining the responsibilities of regulating maritime safety as a function of regional councils. Actually, it is heartening to see this Government finally supporting some type of powers for local authorities, given that it has not been terribly supportive around things like the Land Transport Management Act, the Auckland Housing Accord, the Local Government Act, or, in fact, the changes to the Resource Management Act, where local authorities have been shut out of decision making time and time again. However, it was very nice to read Minister Collins’ quote when she introduced the second reading of this bill. She said that “The bill enables regional councils to continue to regulate maritime safety and maritime-related activities in their regions and provides for a stronger regime for the management of port, harbour, and navigation safety.”

Certainly, where I live in the Hauraki Gulf the local authorities have been active in negotiating around maritime safety. In fact, the Hauraki Gulf Marine Park forum, the Ports of Auckland, the shipping industry, and the Environmental Defence Society got together to develop protocols for the shipping industry around protecting the Bryde’s whales that live in the Hauraki Gulf and that frequently sleep very close to the surface of the water, particularly around the shipping lanes. Part of those protocols is that the ships will be slowing down to about 10 knots, which is a major step forward. I would like to take this opportunity to acknowledge the work of advocate Dr Rochelle Constantine, who has been ceaselessly advocating for these mammals in the Hauraki Gulf for many years. We have finally managed to get some success there.

The Greens do, of course, agree with the provisions in respect of the drink-driving of ships and the limits there for ship captains, and we do also acknowledge the anomaly that we see with drink-driving on land, which has not actually come through at all. We support the penalties and prescriptions around the overloading of ships, bringing us into line with some of the international conventions. And, of course, we agree with acceding to the other international maritime conventions.

What we are not happy with are the amendments around our exclusive economic zone that allow for exploratory drilling as a non-notified discretionary activity, because we see that once more as another lack of democracy. That has been a common theme that this Government has pushed through in piece of legislation after piece of legislation. We note that that provision came through as an amendment through the Committee of the whole House, so it was not actually open to submission during the democratic process that we have that enables legislation in the first place. That really does mar some of the better provisions that have been pushed forward, like the restrictions around waste dumping. That was an amendment that came through from the Transport and Industrial Relations Committee. We will be supporting this bill, but we do have some reservations.

JAMI-LEE ROSS (National—Botany): I commend the Maritime Transport Amendment Bill and the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill to the House.

Maritime Transport Amendment Bill read a third time.

A party vote was called for on the question, That the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill be now read a third time.

Ayes 82

New Zealand National 59; Green Party 14; New Zealand First 6; ACT New Zealand 1; United Future 1; Independent: Horan.

Noes 37

New Zealand Labour 33; Māori Party 3; Mana 1.

Bill read a third time.

Bills

Copyright (Parallel Importing of Films) Amendment Bill

Third Reading

Hon CRAIG FOSS (Minister of Commerce): I move, That the Copyright (Parallel Importing of Films) Amendment Bill be now read a third time. The bill proposes to amend the Copyright Act 1994 by reinstating the ban on parallel importation of films for commercial purposes. The original ban came into force in 2003 to support New Zealand cinemas in the final stages of the transition to digital screening technology. The bill reduces the period of the ban, which will come into force from 31 October 2013, from 9 to 5 months. This reduction reflects the changes in film distribution practices, recognising that New Zealanders now often receive films at the same time as international viewers.

The bill also imposes a sunset clause so that the ban will expire in 3 years, on 31 October 2016. The 3-year time frame will give cinemas that have not yet converted enough time to transition to digital screening technology and to develop their film distribution model to reflect changes in the market for films, particularly online. Many films are released on DVD between 3 and 4 months after their cinematic debut. The 5-month ban will effectively give cinemas a further 1 or 2 months to exclusively screen films without competition. This shortened period will allow retailers to parallel import copies of films earlier and encourage authorised distributors to provide consumers with earlier access to films. The ban does not prevent a person from importing a film for personal use.

The Government strongly supports the transition to digital screening, as it reduces the need for delays in film screening, giving consumers earlier access to films. In its report the Commerce Committee noted that the ban allows cinemas flexibility in scheduling films, particularly for school holiday audiences, creating better financial viability and enabling more movies to be available at the times wanted by consumers. I also acknowledge the select committee’s comments that as consumer viewing technology develops, it expects that this will force cinemas to develop new revenue streams to meet consumers’ expectations rather than rely on past business models. I would like to thank the Commerce Committee for its timely consideration of this bill, and those individuals and organisations who made submissions on the bill. I commend this bill to the House.

CLARE CURRAN (Labour—Dunedin South): Labour members have made it very clear in our speeches on this bill, the Copyright (Parallel Importing of Films) Amendment Bill, that we are reluctant supporters of this measure. We have qualified support for the 5-month delay, which rests purely on the impact of parallel importing on provincial and rural cinemas, which have less capacity to show multiple high-grossing movies simultaneously and less flexibility and ability to cut costs to remain competitive. We believe that the industry should have changed by now and should have caught up with new technology, but we do acknowledge that those cinemas that are in New Zealand’s provincial and rural communities are important and that the Government and Parliament should support their role. That is really the only reason we have for supporting this bill, and we certainly have made it—

The ASSISTANT SPEAKER (Lindsay Tisch): Sorry to interrupt the honourable member. The time has come for me to leave the Chair for the dinner break.

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

CLARE CURRAN: Where I was at was making it very clear that Labour’s support for this bill is very conditional. Our reasoning was purely around the qualified support for the 5-month delay in parallel importing, which rested on the impact on provincial and rural cinemas. We have made it very clear that we will not support another go by this industry coming before a select committee to ask for another extension on parallel importing. I am very keen to ensure that that is reinforced from the other side of the House as this bill has come out of the Commerce Committee.

What lies behind this bill is a much bigger issue. It is an issue about our copyright regime in New Zealand and an issue around intellectual property. Unfortunately, this bill could not be considered within the context of that wider discussion, as it should have been, because the Government has reneged on a commitment it made to undertake a wide-ranging review of the copyright regime in 2013. Instead, it has put that on hold. As we now know, the reason for that is the Trans-Pacific Partnership negotiations—that has been revealed and it has been acknowledged by the Minister of Commerce under questioning. So I want to talk a little bit about that, because where this bill should have sat around parallel importing generally should have been within the context of a wider review.

There are a number of concerns that Labour has around the intellectual property provisions that are potentially in Trans-Pacific Partnership negotiations, which as yet we do not know the detail of because the Government has not been transparent about discussing that with other parties and with the public of New Zealand in general. You do not have to release the text in order to have the discussion, and, unfortunately, we are not able to have the discussion and all we can do is suppose, based on earlier leaked versions of that text. One of our concerns is that there may be being proposed in those negotiations an increased regime of parallel importing generally. What we want to do is make sure that that does not happen, that there is a commitment from the other side of the House to back up the discussions and the outcome of the select committee process, and that that is not what is being planned.

I want to touch on a few of the other potential things that may be around in that copyright regime in the Trans-Pacific Partnership negotiations, and one of them is the potential extension of the duration of copyright by 20 years to 70 years—70 years; yes, that is right—depending on the type of work and the date it was published. It has also been suggested that this could also result in the expansion of the regulatory regime under which internet service providers must assist rights holders in enforcing copyright online, which would pull New Zealand into line with the United States’ Digital Millennium Copyright Act, which we would see as being a backward step, rather than a forward step, in terms of promoting innovation in New Zealand.

We may also be seeing a new criminal offence for the act of circumventing a technological protection measure or a digital lock, which means that people who have legitimately bought DVDs in other countries and brought them back to New Zealand and are unable to watch them because they have been locked into that region are not able to find ways to be able to watch them, which they can do. There could be strengthened laws in that area that would ultimately disadvantage consumers in New Zealand.

Another proposal might require New Zealand to afford rights holders an exclusive right over temporary electronic copies, which could mean changing the provisions in our Copyright Act that carve out the liability for transient reproductions of copyrighted works as part of the normal technological processes. All these issues are very important. They actually do impinge on the ability of artists to go about their work, especially in an online environment. But it is also the impact on innovation and our ability to control our own intellectual property regime that is extremely important.

Our concern is that we are not going to see an aggressive and heavy-handed copyright regime in New Zealand. It is extremely important that we have a balanced and wide-ranging discussion as a community, rather than having those things imposed on us, which is why the transparency around the negotiations in the Trans-Pacific Partnership negotiations is so important—so that the community can have that discussion and so that there can be discussions in the political environment around what is actually being proposed, rather than supposition. This has the potential to harm the way that New Zealand artists and innovative companies work and operate and use the internet to connect with overseas markets. The extension of a copyright duration internet termination as a penalty, making it illegal to bypass technological protection measures, as I said, and restricting parallel imports into other areas, so that New Zealanders would lose access to many overseas works and be forced to pay more, potentially, for books, CDs, and DVDs than the rest of the world, would actually be a backward step. It would be clearly a backward step for us. The most important thing is for us to be able to have the discussion about it.

We believe that excessive copyright durations could also potentially affect libraries from making backups and format-shifting works, which could result in a tangible loss of shared heritage. So I think you might see that although Labour has very qualified support for this bill, which gives an extra 3 years for very limited amounts of parallel importing for this particular issue, this has to be the end of it. We have to be able to move forward. We have to be able to promote innovation and an online environment generally that is a progressive environment for copyright and for having that discussion in New Zealand, because if we do not, we are simply going to be going backwards.

JONATHAN YOUNG (National—New Plymouth): I am very pleased to stand and speak at this third reading of the Copyright (Parallel Importing of Films) Amendment Bill. I think the previous speaker, Clare Curran, did touch on the general sentiment of the Commerce Committee, which felt that this next 3-year period is vital for the parts of the industry that have not transitioned to make that transition.

We know that in 2003, when this provision was first introduced by the then Labour Government, and then when it was extended in 2008, the cost of transition back in those times was exceedingly high. Of course, the digital cost these days is reducing all the time. Even though many submitters said to us that it is $100,000 per screen to transition from 35 millimetre projection to digital projection, we know that most of those theatres in the metropolitan areas have already done this. So in a sense this is a bill for small town New Zealand. It keeps those entertainment industries going while they are able to afford the transition.

I think because of that it is a good bill to do. It extends the ban for another 3 years, but instead of 9 months where the parallel importation of a film for commercial sale is banned, it brings it down to a 5-month period of time. It is a temporary ban for the next 3 years. I guess if New Zealanders want to get something that is hot off the press, they can do a number of things—maybe purchase it from Amazon.com or they can even go to a home video rental agency that has paid a licence fee to the importers and distributors and get movies there as well.

Kris Faafoi: It’s a video shop.

JONATHAN YOUNG: The video shop, that is right.

National, Labour, and the Greens had a very interesting debate through this bill. Simple as it is, it raised a number of very interesting aspects regarding the market place. I think we are in the right spot for it. I think that the industry out there will appreciate the extension of this temporary ban for another 3 years. Once again, as the commentary says and other speakers have said, it is imperative that the transition takes place within these next 3 years. Thank you. I am very happy to commend this bill to the House.

Dr DAVID CLARK (Labour—Dunedin North): I rise to express Labour’s support for this bill, the Copyright (Parallel Importing of Films) Amendment Bill. It is a bill that, as the previous speaker, Jonathan Young, has said, weighs up the various factors at play and comes down with a compromised solution of having a shorter period until this effective subsidy passes.

We on this side of the House and the National Party opposite had some robust conversations in the Commerce Committee. Many of us played devil’s advocate at different times and took different sides of the debate. It was a good select committee discussion. It was well chaired, and I say to the member Jonathan Young over there, who chaired it, that he chaired the discussion well.

We had some interesting conversations. We expanded our own knowledge of the sector. We had advice from officials on many things. We considered factors like the seasonal factors and how, when a film turns up, it is released generally at school holiday times, and how those differ between here and overseas, where the majority of films come from. We talked about competition with other films from similar genres and how that affects the timing of the release of a film. We talked about the availability of advertising, such as billboards and the like, which can create pressure on certain times to screen. We talked about the profitability, or otherwise, of some of the cinemas that have to make the transition to digital over time.

All of the issues were weighed up and, on balance, the 120 cinemas, roughly, in New Zealand were given the benefit of the doubt in terms of allowing them a little more time to make the transitional arrangements necessary. But, as previous speakers have said, we do expect this to be the final transition. We expect this 5-month delay period to be where it ends, and thereafter these things will be released at the same time.

This bill expires on 31 October 2016. Labour gives its qualified support for the 5-month delay on the basis of the impact on provincial and rural cinemas, which have less capacity to show those high-grossing movies simultaneously, which is what is required to be competitive in the market place, because we are concerned about what is going on in rural New Zealand. The Labour Party, of course, thinks that there are other ways that this problem could be tackled. Certainly, higher wages in the regions would go a long way towards making this kind of transition affordable and to making those cinemas profitable, as people would then have the ability to go out and enjoy the kind of entertainment that some of us think ought to be taken for granted—that people could go out and enjoy a movie or take the kids to a movie occasionally. Well, unfortunately, there are many families in New Zealand for whom that is no longer a reality. That is in part because these films are shown at a cost that is prohibitive, but, of course, the reason the cost is prohibitive is that wages are low and families in the regions do not have enough to make ends meet. That means that people are struggling and, consequently, those who provide the entertainment to those people are struggling also. So this bill strikes a balance in the meantime.

We would like to see the Government have a fuller response to the economic issues facing New Zealand, instead of having a two-speed economy where Auckland is running away and the rest of New Zealand is struggling, and where economic growth is really lagging behind what it ought to be in a time when we have had such high dairy prices internationally. Our trade terms should have been better. This Government has underperformed in the economic sector, and regional New Zealand is hurting. One of the ways we are seeing it expressed is here in this bill, where people are not able to afford to go to the cinemas to support those community facilities, which we on this side of the House value.

I am pleased that the discussion was good in the Commerce Committee, I am pleased with where the bill has got to, and I think the industry will be pleased with the additional time. I think, from the tone of the conversations and debates that have been had in this House, that the industry will realise that this is the last extension, and we will not be talking any more about my colleague Kris Faafoi’s fascination with the movie The Smurfs and the Magic Flute again, if luck is on our side. This third reading—

Kris Faafoi: Academy Award - winning performance from Papa Smurf.

Dr DAVID CLARK: —will be the last opportunity to discuss, as my colleague says, the Academy Award - winning performance from Papa Smurf. We did actually discuss in the Commerce Committee the release time of the Smurfs movie. The Smurfs 2 was one of these high-grossing movies, so it actually came up as a topic that we discussed around the table, and how that, as a concrete example, plays out when this legislation goes through. Mr Faafoi admitted in an earlier speech, though, that the first movie he ever went to see was The Smurfs. It sounds like he was a bit of a fan as a younger man. I am sure he will say more when his time comes to speak on the bill, and I hope that is where his contribution stops. I may be inviting a contribution I welcome less if I pursue this line much further.

For Labour, we are happy to support the bill. We are happy that it is a temporary measure, and we want to see these community facilities preserved, but we also think that the bigger issues in the economy need to be addressed. This Government needs to look out for jobs and for higher wages so that people can actually afford to take their kids to the movies. Those simple things need to be addressed. This Government needs to get on top of the economy, rebalance it where it is failing, and focus on the issue that matters to New Zealanders—that is, jobs.

GARETH HUGHES (Green): Kia ora. Ngā mihi nui ki a koutou. Kia ora. I rise to speak on the Copyright (Parallel Importing of Films) Amendment Bill. It is with some dismay and shock that I find myself the only member in this Parliament rising to stand up for competition. I find that deeply ironic. Both the National and Labour parties, the neo-liberal, free-market parties, are the ones supporting a statutory monopoly for content rights holders. I find it staggering that it is the Green Party standing up for competition, new industries, new jobs, and new innovation. It is not always that the Greens are in this position, but I will relish it.

It comes as no surprise that the Greens are opposing this bill despite loving our regional theatres and despite loving films. I do not know whether I am embarrassed or not but the last film I saw was, I think, Riddick, the third in the Pitch Black series, which was pretty cool.

Kris Faafoi: Tell us more.

GARETH HUGHES: I will not tell you any more, because I would rather talk about the substance of the bill. What this bill does, basically, is it reinstates the ban on the parallel importing of films, reduces the period from 9 months to 5 months, and gives a 3-year extension. The Greens are voting against this because we do not believe that one industry deserves a statutory monopoly that is going to drive out competition and drive out competing content delivery systems to protect one business model. It is a business model that, we should point out, has had a 10-year transition period to date—a 10-year transition period. If 10 years is not enough, where is the evidence that 3 years is going to be enough?

I am going to talk a little bit about the process, a little bit about our opposition, and a little bit more about our solutions. Firstly, and I think it is important to note, this bill landed in Parliament under urgency. There was no reason why this bill had to come in under urgency. Of course, we have had a 10-year warning period before this ban on the parallel importing of films was expiring. We think it is unacceptable that bills like this should be introduced under urgency. The Green Party abstained from voting, because there just was not enough information in front of us. We had a letter from Minister Foss arrive on our caucus table that day. So we abstained.

We went into the select committee period with an open mind. We talked to the submitters, obviously. We talked to the movie industry, outside of the select committee process, to gauge its opinions. And we have come to a clear conclusion that the Green Party cannot support this bill. I think it is disappointing that the Labour Party is supporting it, given that in its minority report it said that the losers of this law are the film retailers and the public, who are unable to exercise choice during the period of the ban. That is from the Labour Party. So it is a bit disappointing that it did not go the further step.

I would like to thank the chair of the Commerce Committee, the member Jonathan Young. I would like to thank all the members on the committee and all the submitters. I think two submissions stood out for me in particular. The first was Consumer New Zealand, which said that the ban should lapse entirely this year—not in 3 years; this year. I would also like to note that the Creative Freedom Foundation said that the consequences of this bill are that we are going to see greater copyright infringement. The members in the old parties might call it piracy; I would call it copyright infringement, because it is not actually a criminal—

Tracey Martin: Really?

GARETH HUGHES: No, it is not under the criminal statute, actually; it is a civil offence. That is why I call it copyright infringement. Again, it is deeply ironic. Here is the Green Party standing up to stop copyright infringement. We hear some of the old parties standing up and yelling from the rooftops, after being lobbied by the rights holders, that we need to crack down on piracy. We all remember the Skynet debate. But here is the Green Party standing up for artists, standing up for people, and sending a message. What we need is legal content delivered through new online means, new content delivery systems. We do not support copyright infringement; what we support is a sane copyright approach, a new debate. So here we are in the deeply ironic situation that it is the Green Party standing up for competition, and it is the Green Party standing up and saying no to copyright infringement.

The root of our opposition to this bill is that we can see no justification and we heard no reason why this one particular industry needs a statutory monopoly. This is an incredibly powerful tool our Parliament has. Most of it was scratched from 1984 to 1992 onwards when we went through that big transformation in New Zealand, the neo-liberal revolution. Many of those statutory monopolies—things like bans on margarine to protect the butter industry—were abolished during that period. So we do not find it compelling that this one particular industry needs a statutory monopoly to block out competitors in order to provide its content.

What we see in the regulatory impact statement is that the Government’s own officials are opposed to the bill. What we see, yet again, is another special deal for the Government’s mates. We have seen it with Warner Bros, we have seen it with Skycity, and we have seen it with Rio Tinto, which had the Government over a barrel. There are numerous examples, from the oil companies to the casinos. Again, we are seeing special deals for the Government’s mates.

What we see in this legislation is very much a temporary bandaid. That is what the Labour Party is arguing—that it is a compromise that it has hammered out, that it has negotiated, and that it is a temporary bandaid. Ten years’ transition was not enough, so we need just another 3 years. What we have to ask is if the industry cannot do it in 10 years, how is it going to do it in 3 years?

There are two justifications that both parties and submitters raised, one of which is the school holiday season need for cinemas to be able to have a statutory monopoly—a ban on parallel importing to protect the holiday season films. The fact is that both parties acknowledge that this is going to expire in 3 years. I ask the other parties what is going to be different in 3 years. We are still yet to hear an answer.

The other reason is that the industry needs more time to continue the digital switch-over. The fact is that it has had 10 years. Is it going to come back in another 3 years asking for more time to complete the digital switch-over? In saying that, I want to reaffirm the Green Party’s commitment to, and support for, regional cinemas. We love cinemas, but we think cinemas should be able to trade on their merits, on their services, and on the great atmosphere they provide, not on a statutory monopoly in law. We think that is an incredible power that Parliament alone has in our country, and one that should not be used unwisely. Unlike the member David Clark, I think, gee, if we want to support Kiwi families, I would rather see kids having breakfast. I would rather see kids and families pay less for their electricity bills, not for cinema tickets. We have got to think about the important things facing Kiwi whānaus.

I want to say that this bill also stifles cultural participation. The disability community has come out asking why it should have to go to cinemas to see content when it comes out. I love cinemas, but many Kiwis do not find the cinema experience appealing. They do not want the sticky seats and the popcorn on the floor and to be crowded in a room; they want to consume content in different ways.

The last point I want to make is that what this bill does is look at copyright in isolation. It is vitally important that our Parliament grapples with this very interesting policy debate. It is something that is causing big waves around the world. We saw the European Union throw out the Anti-Counterfeiting Trade Agreement treaty. We have seen the Stop Online Piracy Act and the Protect IP Act thrown out of the Congress and the Senate in the States. We have seen Australia, we have seen the UK, and we have seen America do copyright reviews. What we hear from the Government is that we have to put aside our much-anticipated copyright review because of the Trans-Pacific Partnership agreement. The fact is that other partnership countries are undertaking copyright reviews. There is no reason why we should not be having a fundamental discussion of what copyright means in the internet age, because our Copyright Act was written very much in a pre-internet age.

I would like to reference a recent London School of Economics report. Again, I find it odd that I am the only member to talk about London School of Economics reports when it comes to copyright. The fact is that what this report very clearly states is that the claims made by rights holders are overstated and are built on faulty data. It also states that the most successful way we can support artists and rights holders is not these punitive approaches that use the might of the State through laws to ban content or crack down and disable people’s internet connections; the best way we can support artists and rights holders is to empower them to have new ways to deliver their content affordably and legally and to give people choices. That is why the Greens are opposed to this bill. We want to see new jobs created. We do not want to protect just one sector. If you can deliver content online or through other means, we want to support you. We want to give you a fair go, a level playing field. If you can compete based on your services, your quality, you should be able to do it. It should not be the might of the State cracking down on you.

The fact is that if the digitisation reason is the big driver for why the industry needs 3 extra years, I think the most effective, transparent way that this Parliament and this Government could support the digital transition is actually cash support—maybe financing support. We have seen it in other sectors of the economy. If it is that dire, the industry should be asking for transparent support mechanisms that do not disadvantage other industries, other competitors. But it is the Greens, you know, who are standing up for sensible copyright reform, competition, jobs, and a fair go for all New Zealand companies. Kia ora.

KANWALJIT SINGH BAKSHI (National): First of all, I would like to congratulate you, Mr Assistant Speaker Robertson, on your election to the local board.

It is my pleasure to stand in the third reading of the Copyright (Parallel Importing of Films) Amendment Bill. I think we will all agree that it is a pragmatic and sensible piece of legislation, and the Minister in charge of the bill, the Hon Craig Foss, needs to be congratulated on his commendable effort.

The film industry is in the middle of a large-scale makeover as members across the country convert to digital exhibition technology. The conversion is well under way and is expected to be completed within the next 2 or 3 years. The previous speaker, Gareth Hughes, was saying that we need to create jobs. If we do not support this industry, then we are going to lose jobs and stop development in this industry. I think it is in the DNA of the Green Party that it has to oppose everything that the Government wants to do.

I think this is a good bill. I commend it to the House.

TRACEY MARTIN (NZ First): Kia ora, Mr Assistant Speaker. I rise to provide New Zealand First’s contribution on the Copyright (Parallel Importing of Films) Amendment Bill. New Zealand First will be supporting this bill. I found it incredibly interesting listening to the Labour Party contribution by the member Clare Curran and also to the Green Party contribution by Mr Gareth Hughes. Ms Curran’s contribution somehow suggested that these New Zealanders, these cinema owners, are ripping off New Zealanders, that these New Zealanders who are running businesses with New Zealand employees are somehow ripping off New Zealand by asking for the continuation—a short continuation—of a delayed release protection. That is what they are asking for. That is all they are asking for.

I find it fascinating that Mr Hughes calls this a statutory monopoly. A statutory monopoly is what he calls this. I have to remind Mr Hughes—and apparently he was on the Commerce Committee, so I would have thought he would know—that the DVD companies that have the right to release these DVDs and therefore sell them also get protection. The pay-per-view channels cannot play any of these movies for a period of time after the cinema release. Pay television cannot play these films for 9 to 12 months after the DVD people have got them, and free-to-air cannot play them for 12 to 24 months after the DVD people have got them. So it is not a statutory monopoly at all that these poor little rural cinemas employing good, honest, hard-working New Zealanders in particularly difficult financial times are seeking from their Government and from their Parliament; they are seeking a little bit more time to step up into the digital age. I do not think that is a statutory monopoly; I think that is New Zealanders asking from their elected representatives the protections that they should have and the consideration that their Government should give them when it talks about New Zealanders’ jobs. That is what I would say.

These two members also appear to have forgotten the other part of the conversation, which is actually about the ability for New Zealand films to be shown. There is a whole area of film production behind this conversation. There needs to be a window in which rural cinemas and New Zealand cinemas can show New Zealand - made films. If New Zealand - made films have to go straight to DVD without any of the coverage that they can get from being shown inside mainstream cinemas, they will lose money and that industry will fold. Let us just have a talk about how much money that industry brings in, shall we? A 2012 report by New Zealand’s leading financial services firm, PricewaterhouseCoopers, Economic contribution of the New Zealand film and television industry, indicates that the industry generated more than $3.23 billion in revenue in 2011.

I do not want to take too long, because this bill is going to pass—it needs to pass—but some common sense needed to be put into the conversation, quite frankly. When the Labour Party starts using the word “choice”, you need to worry, New Zealand, because that word has traditionally belonged to the right. What we have got now is Ms Curran standing up and we have got the Green Party standing up and talking about how New Zealanders should have choice—New Zealanders should have choice. Damn the sales. Damn the New Zealanders being employed. This is about choice. I think New Zealand needs to think very carefully in 2014 about which party it really needs to put into power in this House—the party that truly stands up for New Zealanders and the one that puts New Zealanders first in every piece of legislation. New Zealand First will vote for this legislation.

The ASSISTANT SPEAKER (H V Ross Robertson): I call the honourable member Jian Yang. Ni hao ma.

Dr JIAN YANG (National): Very good. Xiexie. I am pleased to rise to take a brief call on the Copyright (Parallel Importing of Films) Amendment Bill. This bill imposes a temporary ban on the parallel importation of films for commercial purposes for 5 months from the date of the film’s first release to the public. The purpose of the ban is to give cinemas more time to convert to digital exhibition technology. The ban allows cinemas flexibility in scheduling films, particularly for school holiday audiences, creating better financial viability, which enables more movies to be available at times when wanted by consumers. This position has general support from other parties and within the sector.

I do not go to cinemas very often—I wish I could—but I normally would find some time during the school holidays to watch one or two movies with my children. I believe that many parents do the same thing.

Over 60 percent of cinemas have now converted to digital exhibition technology, so this temporary ban, a 5-month ban, will give an opportunity for the rest of the cinemas to complete the conversion. I commend the bill to the House. Thank you.

The ASSISTANT SPEAKER (H V Ross Robertson): I call the honourable member Kris Faafoi—The Smurfs 2.

KRIS FAAFOI (Labour—Mana): Taloha ni, Mr Assistant Speaker. Just to correct you—I am not sure whether I am allowed to do that under the Standing Orders—but it was not The Smurfs 2 that was my first movie; it was actually The Smurfs and the Magic Flute, which was released around the early 1980s. Now that David Clark has finished his speeches during this debate, I am glad that that record will be over and that my name will not be associated with that movie any more.

I do want to point out that from time to time, as MPs, as we debate issues in minutiae in the select committees and here in this House, we kind of lose track of what this actually means to the average punter. We are talking about the movies here. When a movie is released in the cinema, what we have had in the past is a delay period. I do not like to call it a ban; I like to call it a grace period, during which the company that is distributing that movie can have 9 months’ grace where it can sell DVDs—the likes of the very good New Zealand - made movie Mt. Zion—and have the period where it can make profits off selling the DVDs at full price. After that 9-month period, anyone else can parallel import that movie in if they want to. Obviously, that is usually 9 months after the cinematic release. Usually, you then see the movies that 9 months ago were selling for $40 in the basement bargain bin selling for about $10. That is what we are talking about here—that process.

This bill, the Copyright (Parallel Importing of Films) Amendment Bill, will change that process. It is in legislation that that grace period is there. This bill will extend that grace period for 3 more years but reduce the grace period for parallel imports to 5 months. As we have said on this side of the House, the Labour Party will be supporting that, more or less for the specific reason to support the likes of smaller cinema operators in rural and regional areas—

Hon Shane Jones: Like Kaitāia.

KRIS FAAFOI: The likes of Kaitāia. Although I have not been to the movies in Kaitāia, we are wanting to support this bill to support the likes of those cinemas.

I do actually have to agree with some of what the New Zealand First member Tracey Martin said. We do actually want to protect the jobs of the people who are working in those smaller cinemas. I understand that during the select committee process a figure of around 160 jobs in those smaller cinemas was mentioned or raised. Certainly, the benefit of those cinemas to be able to change their technology and to support those businesses in those smaller areas is the reason that the Labour Party continues to support this grace period being extended. We do not, however, believe it should be extended for 3 years. It is 2016, I believe. I am looking at the chair of the Commerce Committee. He is saying that, yes, it is extended to the end of 2016. We believe that 2 years is enough for those cinemas to make the transition from the old 35 millimetre technology to the digital technology, which, of course, another member, Kanwaljit Singh Bakshi, mentioned is in roughly around 60 percent of the cinemas around the country.

We also believe that the decreasing of the grace period from 9 months to 5 months should send a pretty clear signal to the cinema industry that this is the last chance saloon. If they do not start transitioning to the digital technology, they will not get another chance of extending the legislation that was passed in 2003. Labour will not support any further extension of this legislation beyond 2016, and as I would like to reiterate, we actually think it should end at the end of 2015.

I do want to make the point to the member from the Greens Gareth Hughes that if he would like to come and have a look around the Light House Cinema in Pāuatahanui, one of the cinemas that we are concerned about, and listen to some of the concerns that those cinema operators have, they do very much appreciate the fact that we are able to give those smaller operators some more time to switch to the digital technology.

Hon Shane Jones: And Gisborne.

KRIS FAAFOI: And the likes of Gisborne, because it is those smaller cinemas that will be hurt if this grace period were to end on 31 October this year. The likes of the Light House Cinema—I went to the Light House Cinema in Pētone recently to watch a great New Zealand movie—Mr Pip. Certainly, I think that cinema had transitioned. So a number of those smaller arthouse cinemas are transitioning, but we need to make sure we give them just a little bit more time to be able to make the switch over to the digital technology.

A lot has been spoken in this debate about the movie experience, and it certainly has changed over time. The Hon Shane Jones may have been to the cinema when the national anthem was played before the beginning of the movie, and the movie theatre was the only place to watch that movie. But, having said that, times have changed and technology has changed. Mark Mitchell may have watched a movie in the cinema and then later on, maybe 3 or 6 months later—

Hon Shane Jones: Yeah, but he never got caught.

KRIS FAAFOI: —that is a very good point—he could have rented that movie from the video shop, as Mr Young mentioned before. But now technology has changed so much that when a movie is released internationally, you can have it almost instantly. So that is why we believe that this piece of legislation should have a defined time frame. We believe that Kiwis should have access to that content if it is being released, let us say in the States, and if, by some technology, you are able to download it here in New Zealand instantly, you should be able to do that.

I am not sure whether I am about to break the Standing Orders but I would like to acknowledge the Hon Chris Tremain, who has just walked into the House. I take my first opportunity to wish him all the best, post this Parliament. I share a radio show with him. We call it “Ebony and Ivory”—

Hon Shane Jones: Which one is which?

KRIS FAAFOI: I will not make judgments on who is who. I just want to take this chance to wish you all the best, post your parliamentary career, as you are one of the members across the House who has been very pleasant to me and I wish you all the best in your business career, which I am sure will be helped by the economic settings of the next Labour Government.

As I draw to a conclusion, as I begin my very long conclusion, I say that this piece of legislation should be passed. There are concerns from the Green Party that it should not, but we believe that in the interests of those smaller operators it should be extended, but this should be the last time that it is extended. This is certainly the last time that the Labour Party will support this legislation, because we believe that with the growing convergence of digital technology, we consider that New Zealand should be a modern and connected society and we should be able to access the media or the movies at the same time as the rest of the world. We believe that is why just a 2-year extension should be put on this piece of legislation.

We believe that the lack of legal methods to get this content, if it is released overseas, could lead to increasing the level of piracy out there, so that people are actually illegally downloading movies, where we should have the technology and the ability, in terms of the data caps and ultra-fast broadband, to make sure that New Zealanders can have access to this content as soon as we can. I think the Rev. Dr David Clark also mentioned that extending this period may also increase the price of going to the movies for the average Kiwi fan. We think that is a shame, and certainly we hope that after that 2-year period, when we scrap the 5-year grace period, that certainly would make the cinema-going experience much cheaper—

Jonathan Young: Three years.

KRIS FAAFOI: —3 years, sorry—

Hon Shane Jones: More enjoyable.

KRIS FAAFOI: —and more enjoyable for New Zealanders. It is also a challenge to the cinema industry to make sure that they are more innovative in terms of trying to attract people into their businesses.

Our support is qualified. We do note that it is the 5-month grace period on parallel imports, and not the 9-month grace period that was introduced in 2003. We believe that that is sending a strong message to the cinema industry that it should get shipshape or ship out. We do support this piece of legislation because of those regional and smaller cinemas in those areas. It will protect around 160 jobs. But we do hope that in 2016 that will be the end of it. We certainly will not be supporting any legislation that looks to extend that period.

MARK MITCHELL (National—Rodney): I just want to comment on the contribution made by the Green Party member Gareth Hughes, because it was a bit of a confusing contribution. He said that, actually, there was not anything illegal about what was happening. But if you go back and have a look at the Green Party minority view, it clearly states: “We were also persuaded by arguments that the bill stifles cultural participation,”—it would have been good to get an explanation around that—“and encourages illegal file sharing in the absence of legal alternatives.” So there was definitely a reference there to illegal file-sharing.

This Copyright (Parallel Importing of Films) Amendment Bill is a very good bill. Our theatres do need a bit more time. It is not going to happen again. That has been made very clear. But they do need a bit more time to make the switch to digital. In Matakana, in my own electorate, the theatres are 66 percent digitised there—two of their three theatres are digitised. Who knows, Mr Faafoi? If they ever get The Smurfs and the Magic Flute in 3-D, you can come up and enjoy the experience in Matakana. It is a very good bill. I commend it to the House.

The ASSISTANT SPEAKER (H V Ross Robertson): I call the honourable member Iain Lees-Galloway. This is a full call, Mr Lees-Galloway. It is not split.

IAIN LEES-GALLOWAY (Labour—Palmerston North): A full call—excellent, very good. The Copyright (Parallel Importing of Films) Amendment Bill is one of those challenging issues. I know there would have been a lot of conversation at the Commerce Committee. You have got really good arguments both for and against implementing this amendment bill to carry on with the ban on parallel importing of films for a period after they are released at the cinema.

On the one hand, there is the argument that, actually, the industry should have made the transition in the 10 years that it was given to make the transition to the business model of the digital world. That period is over and it is time for it to make the change. By not requiring the industry to make that change, we are, essentially, diminishing choice for consumers and potentially unnecessarily increasing costs for consumers. On the other hand, though, the fact is that for many provincial cinemas in particular, the cost of completing that transition has been prohibitive and they have asked for a little bit more time to be able to do that. Those provincial communities would be losing something very significant if their local cinema had to close down.

Like the Government, we are concerned that people are exiting the provinces at a tremendous rate. We are concerned that many New Zealanders are flooding over to Australia. There is this massive exodus of people out of the country as the economic opportunities in the regions have been stifled by the lack of a comprehensive programme of regional economic development from the Government. We share those concerns with them. We would not want there to be any other reason for people to leave the provinces and go to the major urban centres or even, as we know they are doing, leave the provinces to leave the country altogether and head over the Tasman to Australia and further afield.

It is in the full knowledge of trying to achieve that sensible balance that Labour, with reservations, of course, does support this bill. It was a Labour Government that originally passed the Copyright (Parallel Importation of Films and Onus of Proof) Amendment Act 2003, which was the original legislation that gave the industry that 10-year grace period in which to make the transition. It is because those provisions in that Act are set to expire very soon that this bill continues on with those provisions.

We agree that as part of the agreement with the industry to carry on that transition period, the ban delaying the importation of films has been reduced from 9 months down to 5 months. That will certainly assist with bringing those films on to the market in other formats and in ways that might be more accessible to people.

I think my colleague David Clark actually touched on one of the issues that really is at the heart of this. What we are talking about is the cost of being able to access films, which is part of the cost of living, and the cost of things that we expect Kiwi families to be able to take for granted. Of course, with the cost of living there is a balance to the equation. There are two sides to the equation. One is what things cost, but the other is actually how much money people have and the resources people have to be able to meet the cost of living.

What we have seen in recent years is the cost of living going up and up and up in a number of ways, whether it be people’s power bills, whether it be the cost of accommodation, or whether it be the cost of fuel, the cost of food, the cost of clothing, the cost of school books and shoes. The basics of life are going up and up and up, but wages, of course, are not keeping up with that increase in costs.

So although on the one hand we should be doing everything we can to keep the cost down of what is pretty basic entertainment and something that everybody growing up in and living in New Zealand should be able to take for granted—we should keep those costs down—we should also be looking at how we ensure people have the resources to be able to achieve and experience a basic standard of living in New Zealand. That, of course, requires decent wages. On this side of the House, we have reservations about this legislation, but we would also make sure that family pay packets were augmented, by doing things like increasing the minimum wage to $15 an hour and supporting the living wage campaign. So in many ways this legislation is a balancing act.

I take some issue with the Greens’ position. It is all very well to be able to take the purist view. A lot of what is behind the Greens’ argument is perfectly valid, but they have got to actually look at what it means for people’s lives in a real sense. I encourage the Greens to get out of Wellington—get out of Wellington Central—and actually go and talk to some of the provinces and the provincial communities that would be impacted should we not pass this legislation. It is not ideal. We accept that it is not ideal, but we have to think about the practicalities of the legislation that we pass and what things will mean in real terms for people. If we held the Green view, which, in the purest sense, is an understandable view, the fact is that cinemas in regional and provincial communities would close. It is as simple as that. So it is all very well to have an intellectual argument about these things, but we have to think about the practicalities as well.

There is growing concern that the kinds of bans on parallel importing that are included in this legislation may be something that we are going to see more and more of. I know that a lot of people in the community have concerns that that would come with the Trans-Pacific Partnership. Of course, one of the big problems about trying to take a view on the Trans-Pacific Partnership is how little information we have received from the Government about what it is that it is negotiating and what that will look like. I understand and I know that what Government members would say is that in the past, when Labour Governments have negotiated free-trade agreements, they have not handed out all the details. But what we did do is take a more inclusive approach, so we made sure that organisations like the New Zealand Council of Trade Unions and organisations like Greenpeace—

Tim Macindoe: Valiant effort. Valiant effort.

IAIN LEES-GALLOWAY: Sorry? I appreciate the words from the Government’s junior whip. We made sure that organisations like the Council of Trade Unions and Greenpeace were kept in the fold and had an understanding of the kinds of issues that were being dealt with during free-trade agreements.

The Trans-Pacific Partnership is much more than a free-trade agreement. It goes well beyond simply talking about tariffs that are applied to commodities. I think the Government is probably experiencing so much resistance from the wider public because it has really taken that withholding of information to an extreme—to the point where people are starting to feel as though it is becoming quite an anti-democratic process and people are feeling locked out of the process. When you lock people out of the process, there is a lack of understanding, and there is fear of what that might mean.

And, certainly, there is concern that the kind of ban on parallel importing that is part of this legislation will be applied to a range of other products where people enjoy the low prices that come with parallel importing—particularly, I think, of clothing and the basic necessities of life, where the price has come down because we have had the ability to use parallel importing in New Zealand. There is fear out there in the community as to what the impact could be if such bans were included in a treaty that New Zealand signs up to.

So we call on the Government to be a lot more transparent around its negotiations and to work with the public. We understand that the agreement could have a lot of benefits, but it does carry a lot of risks as well, so naturally there is fear out there in the community. The Government could handle this in a much more constructive and collaborative way with the public than it has been doing.

To summarise, the Labour Party does support this bill. Labour has significant reservations about it, but it understands that this is necessary for rural and provincial and regional communities to be able to carry on with that basic right of being able to go out and have a family night at the movies. This is necessary, but this is the final opportunity for the industry to make that transition that it needs to make and to start living in the digital world and the 21st century.

TIM MACINDOE (National—Hamilton West): Thank you, Mr Assistant Speaker Robertson, and may I too congratulate you on your recent election to public office. You are a dedicated worker for the people of your community and I acknowledge you for that, and I wish you well in your new role.

We have had a very constructive debate on the Copyright (Parallel Importing of Films) Amendment Bill, and I want to thank all the members who have contributed to it. We have had thoughtful contributions, we have had some humorous asides, and we have even had one or two surprising contributions, not the least of which was the surprising audition, I think I should say, by the Green MP Gareth Hughes to become the new leader of the Ayn Rand Institute. I wish him well for that. I am sure it will be surprised to find him in its midst, but politics keeps strange bedfellows, and good luck to him for that.

As I say, it has been a good debate. I think it has reached a sensible compromise or solution to an issue that needed attention of this type, and I am glad to lend my support to it.

A party vote was called for on the question, That the Copyright (Parallel Importing of Films) Amendment Bill be now read a third time.

Ayes 103

New Zealand National 59; New Zealand Labour 33; New Zealand First 7; Māori Party 2; ACT New Zealand 1; United Future 1.

Noes 15

Green Party 13; Mana 1; Independent: Horan.

Bill read a third time.

Bills

Local Government (Auckland Council) Amendment Bill (No 2)

Third Reading

Hon CHRIS TREMAIN (Minister of Local Government): I move, That the Local Government (Auckland Council) Amendment Bill (No 2) be now read a third time. The purpose of the Local Government (Auckland Council) Amendment Bill (No 2) is to amend the Local Government (Auckland Council) Act of 2009 to provide powers to local boards to delegate responsibilities allocated to them under the Act.

Phil Twyford: What a good Minister.

Hon CHRIS TREMAIN: Thank you. I want to acknowledge the work of the Local Government and Environment Committee, of which that member is a fine member. I also wish to thank the Auckland Council for its supporting submission on the bill. Can I acknowledge the member Phil Twyford across the House, who is a member of that committee, and also particularly Nicky Wagner, who chairs the committee. I acknowledge her work and the work of the wider committee on the bill. The bill has received unanimous support through its parliamentary stages, and I look forward to it receiving the same level of support as we wind into the end of this debate.

There are 21 local boards throughout the Auckland region. They have a significant and wide-ranging role, which spans most local government services and activities. They service areas of significant population. In fact, only two of Auckland’s 21 local boards have populations of fewer than 45,000 people. Elected bodies need flexibility in how they structure their decision making. They need to be able to create committees and subcommittees, and to delegate appropriate responsibilities to them. This need was recognised through the Government’s Auckland reforms policy package, and local board delegation powers were provided for through transitional regulations.

These regulations will expire on 31 October of this year. The transitional regulations were always recognised as an interim solution. They allowed time for the development of a more robust understanding of local board operations and associated delegation needs. The understanding could then be reflected in a future amendment to the Act, with the opportunity to adjust the provisions should local board experiences deem it necessary to do so. Well, the fact is that there has been no need for change. These delegations have been well executed. There is good experience, and now this bill rolls out the legislation exactly as the regulations were originally drafted and provided for.

Auckland’s local boards are working well. They are contributing effectively to the governance of the whole region and to the communities within it. The local board model has proven so successful that as a result this Government has made it available in a modified form to other parts of New Zealand. In fact, the Hon Nick Smith, in last year’s Local Government Act 2002 Amendment Act, allowed for the Auckland two-tier model of governance to be copied in some circumstances—that is, where a proposed metropolitan unitary authority has a population of more than 400,000—but it did not at that point enable it for smaller populations.

Further amendments to the Local Government Act to be introduced later this year under a new local government amendment bill will provide the ability for local boards to be established more widely where unitary authorities are established through reorganisation or through amalgamation. This initiative will deliver on requests from local government, and it recognises that authorities and their communities need a broad range of reorganisation options to enable the more effective and efficient provision of local government services and facilities. I think that this will be an excellent initiative, and, once again, I look forward to it receiving the support of the wider House as we roll out that local board opportunity to other communities throughout New Zealand. It is important to understand that it will still be up to the Local Government Commission, in consultation with those communities that are proposing to undertake reorganisation, to determine when the establishment of local boards is justified and is, in fact, desirable.

The effectiveness of local board delegation powers and the local board model as a whole are just two examples of the success of the Auckland governance reforms. The reforms were instigated by central government in 2009 and 2010 under the leadership of Rodney Hide, the Minister of Local Government at that point in time, and also of the Hon John Carter, who was his Associate Minister at that point in time.

Phil Twyford: And we’ll come to Rodney Hide.

Hon CHRIS TREMAIN: The changes were necessary because of longstanding problems with Auckland, which Mr Twyford across the House has acknowledged in a number of speeches. The eight councils lacked a collective sense of purpose and did not have the constitutional ability to effectively address the region’s wider issues. Local issues and parochial attitudes created an insurmountable barrier to regional progress and integrated development. But I am pleased to say that since the creation of the new Auckland Council, the Auckland region has, for the first time, a unified, single goal—that is, to make Auckland the world’s most livable city.

Significant progress has been made in working towards achieving this goal. I will not go into the full detail of that, but I will just mention a couple of the key achievements: firstly, the launch of the Auckland Plan, which is a 30-year strategy to guide the region’s development to 2041. Auckland has adopted the City Centre Masterplan, the Waterfront Plan, and the Economic Development Strategy. Just imagine if that had been in place when the opportunity was there to put a stadium on the Auckland waterfront. Auckland hosted significant portions of the Rugby World Cup in 2011. It has unified its entire library group. It is now the largest in Australasia, providing outstanding services to the citizens of Auckland. Also, what we have seen is the development of a world-class public transport system, which is excellent. As part of that, there is the purchase of a new fleet of modern electric trains. There is a working partnership with central government to progress major roading projects such as the Auckland-Manukau Eastern Transport Initiative; the East West Link; the second Waitematā Harbour crossing, which is in the mix coming forward, over to Maggie Barry’s fine part of town; and also the City Rail Link. These have all come together under this Government, working together with the Auckland Council.

The reorganisation of local government in Auckland also provided the opportunity to release significant efficiency gains. For the financial year of 2011-12, the Auckland Council achieved an $81 million efficiency savings gain, and over the next 10 years we are looking to see $1.7 billion worth of savings. This is an outstanding result. Rodney Hide can take a bow for this achievement going forward. These savings represent the reduced costs of delivering the same service levels planned by the legacy councils. It results in lower rates overall than what were planned. In fact, I understand they are lower than expected, at 3.94 percent, and the council expects to be able to cap rates increases at 4.9 percent over the next 10 years. This is a huge achievement.

Due to its size, uniqueness, and economic influence, a successful Auckland is crucial to the success of New Zealand as a whole. The Auckland Council, as created by the Government’s Auckland governance reform package, is providing for a successful Auckland. Part of that success is in ensuring the efficient and effective management of local boards’ responsibilities and the delegation of the responsibilities allocated to them. Can I thank members of the House again for their wider support of this bill. This bill’s time has come. I commend the bill to the House.

PHIL TWYFORD (Labour—Te Atatū): Mr Assistant Speaker Robertson, I want to add my congratulations on the success that you had on the weekend in being elected as a member of the Papatoetoe Subdivision of the Ōtara-Papatoetoe Local Board. Congratulations.

The ASSISTANT SPEAKER (H V Ross Robertson): Thank you.

PHIL TWYFORD: It is very timely, actually, to be debating this rather non-controversial legislation about the Auckland Council local boards because I think that the local government election results on the weekend suggest, well, if not a maturing, then I think a useful development of the local boards. It is worth noting that what we saw across the city in parts of the region—not all, but in parts of the region—was quite a swing to the left politically and the growing success of tickets, whether they were community coalition tickets or, in fact, political party tickets. I am very pleased to see that in west Auckland, where I am based, two very successful Labour tickets on the Henderson-Massey Local Board were elected, three members for the first time, and that the Labour ticket on the Whau Local Board actually won a majority. So that was extremely successful. In the Waitakere Ranges Local Board, Future West, which is a Labour-Green community independent’s ticket, cleaned up and won all of the six seats. In the Puketāpapa seat the Roskill Community Voice won a majority there. City Vision held on to majorities in the Waitematā Local Board and the Albert-Eden Local Board areas. The Labour team in Māngere-Ōtāhuhu held on to its majority there.

So it is interesting to see more successful campaigning by tickets, which I think is good, when you think about a lot of the commentary that we have seen publicly over the last couple of weeks about the low turnout in local government. The argument some people have made is that in the larger centres, where people do not know each other so personally, voters do not know who they are voting for. Therefore, a ticket with an identifiable brand and a set of values and policies makes it easier for people to know who they are voting for and what they are voting for. So from my point of view, and from the point of view of the left in Auckland, to see that kind of strength in the election results in the local boards across Auckland Council was very gratifying.

The Local Government (Auckland Council) Amendment Bill (No 2), as has been said by the Minister of Local Government, Chris Tremain, one of the real nice guys of this House—we are going to be sorry to see him go at the end of this term, but I think Stuart Nash will make an excellent replacement, and we look forward to Stuart resuming his place in the House. This is a technical bill. We are supporting it. It is before the House only because of the incompetence of the National Government in the way that it has drafted the super-city legislation. It made these powers of delegation that the local boards rely on to delegate the work of the board to council staff—the day-to-day tasks need to be delegated in many cases. This enabling legislation allows that to happen, but it should never have been put in a bill with a sunset clause, as was done by the National Government. But, nevertheless, we are supporting it.

I think now is a moment when we can reflect on the local boards. They were the subject of so much controversy and debate during the time that Rodney Hide was implementing the super-city reforms in 2009 and 2010, and we argued whether there should be fewer or more, whether they should be bigger or smaller. The Government opted for this two-tier structure with 21 local boards, with most of the significant decision-making powers concentrated in the governing body, or what most people would describe as the council, but these local boards are given the role of being essentially a kind of community engagement mechanism for the super-city. They have—and I am sorry to say this, given that you have just won election, Mr Assistant Speaker, to one of these local boards—very few decision-making powers. They have no regulatory or rule-making powers. They have oversight of budgets, but, in fact, most of those budgets have been allocated, so really what they are doing is kind of twiddling around the edges. They have the management and control of some libraries, some parks, and some community facilities. But it is pretty small stuff.

In fact, these local boards are a kind of advocacy platform for communities to be able to come and lobby, convince the local boards of certain issues, and the idea is that those boards will then advocate upwards to the governing body.

Denise Roche: It’s not upwards.

PHIL TWYFORD: Well, it is a kind of governance model.

Hon Members: It’s not even upwards.

PHIL TWYFORD: I know that the Green and New Zealand First members think it is not upwards, but, frankly, I would submit that they are in la-la land if they think that the local boards and the governing body of Auckland Council have some kind of horizontal arrangement with power shared equally between them, because they are not.

In fact, I think that is why the jury is still out on this governance model, which was chosen by Rodney Hide and the National Government, because it gives a second tier of governance at the local level that has very little in the way of real decision-making power. Now there are other councils around New Zealand, like the Greater Wellington Regional Council, that are considering the same two-tier model and trying to weigh up whether, in fact, the two-tier model with these so-called local boards is a good way to go. Frankly, I actually think that a larger assembly model with a greater number of councillors, acting more like a Parliament with electorates, could actually offer a far higher level of democratic accountability and a real decision-making power much closer to the communities. But that was not the way that Rodney Hide saw it.

We saw, actually, a really interesting insight in the Herald on Sunday this weekend, when Rodney Hide in his column in the Herald on Sunday said that if it were his choice, he would replace the elected representatives of local government with appointed officials. That explains a lot about Rodney Hide’s time as the Minister of Local Government and the decisions that he made on behalf of National in setting up the Auckland super-city. He and the members opposite were the ones who voted for a highly corporatised structure in Auckland, which took 75 percent of the services and the assets in Auckland and handed them over to corporate entities governed by hand-picked business appointees—the boards of these so-called council-controlled organisations. That was just one of a whole pipeline of decisions and policies that National has made that showed contempt for local democracy and contempt for the right of communities to control their cities and their communities. We saw it with the way in which National handled the super-city. We have seen it with the suspension of democracy in Canterbury, in terms of Environment Canterbury. We have seen it in the way that the purpose statement of local government was stripped out of the local government legislation. We saw it most recently, actually, in the Land Transport Management Amendment Bill, which shifted transport priority-setting away from local communities to the executive arm of Government, which is Cabinet.

So how have the local boards gone? I think the jury is out. Some of them have done very well. Some of the elected representatives on the local boards in Auckland have done a fantastic job of responding to the needs of their communities, raising issues, and taking initiatives. Others, I would say, not so much. My hope is that in this second term of the Auckland Council, the new crop of elected representatives and local board members right across the region will take the bull by the horns and really use these local boards as a platform to campaign, to raise issues, and to speak out on behalf of their communities, as some of them have done very effectively—not to be constrained by the very limited decision-making powers and resources that they have at their disposal, but to speak up for their communities, to build alliances with each other, to build alliances with members of the governing body, and to really use the local boards as a platform to raise issues and progress their own agendas. If they do that, they will at least, I think, have made the most of the opportunity that these local boards offer. Thank you.

NICKY WAGNER (National—Christchurch Central): I am very pleased to be supporting this bill, the Local Government (Auckland Council) Amendment Bill (No 2), in its third reading. It is very good that it will be passed before the transitional powers concerning local boards expire. The bill was considered by the Local Government and Environment Committee, and it was a pleasure to work on. It was non-controversial. It is a technical bill. There was only one submission, and that was from the Auckland Council, which supported the bill. The committee members also agreed unanimously to support it and reported the bill back to the House without amendment.

As we have heard, the bill amends the Local Government (Auckland Council) Act 2009, and it enables Auckland’s local boards to continue to delegate various functions and powers to committees of the local board or to a council officer. It needs to be done now so that the council operations can continue seamlessly, because the transitional powers expire on 31 October.

Contrary to the comments of the member Phil Twyford, the regulations were transitional for a reason. They were transitional to allow for time for a better understanding of how local boards would operate and to make sure that the structure worked well. Time has shown that this structure is very appropriate. It has passed the practical, on-the-ground test, and there is agreement throughout the Auckland Council to support this structure and to pass this legislation.

The National Government, of course, is very keen to see local government being efficient, being responsive, and being well focused. So we are supportive of the Auckland Council when it tells us that allowing these local boards to continue delegating responsibilities as they currently do will help them to operate effectively and efficiently.

The success of this local board model means that in the future that model in a modified form will be available for use in other parts of New Zealand. Last year in the Local Government Act we allowed for the Auckland two-tier model of government to be used under certain circumstances. It could be used where there was a proposed metropolitan unitary authority that had a population of over 400,000. It was not available for smaller populations. However, due to requests from local government, we are planning to make further amendments to the Local Government Act this year that will provide for the ability for local boards to be established more widely where unitary authorities are established, perhaps through reorganisation or amalgamation. For example, an amalgamated local authority may be able to achieve economies of scale in infrastructure investment and operation, and would perhaps be better able to access specialist expertise and resources.

But we do not want to do this at the expense of community choice or identity at a local level. This is where local representation, through local boards, can perhaps provide for that. It will be up to the Local Government Commission, in consultation with communities undertaking any kind of reorganisation, to determine whether the establishment of a local board will work in a community, can be justified, and is desirable. The model is working well in Auckland, and it could be another very useful tool for more effective local government elsewhere across the country. I support this bill to the House.

CAROL BEAUMONT (Labour): I was hoping that the previous Assistant Speaker would still be in the Chair—not from any disrespect to you, Mr Assistant Speaker Tisch, but because I was going to acknowledge, of course, as others have, Ross Robertson’s election to the Papatoetoe subdivision of the Ōtara-Papatoetoe Local Board, representing Team Papatoetoe. I know that Ross will be a very hard-working and determined representative of his local community. I just want to acknowledge that as I rise to speak in support of the Local Government (Auckland Council) Amendment Bill (No 2), which I have spoken on in every stage of this bill going through the House.

As many of us will now know, this is a very narrow bill—quite a technical bill, really—that fixes what was probably a mistake made in the rush to pass the Auckland legislation, the super-city legislation. The ability of local boards to be able to delegate responsibilities, duties, and powers confirmed or allocated to them under the Local Government (Auckland Council) Act was a transitional arrangement with a limited life, and that life is due to expire at the end of October if we do not pass this legislation. Of course, it is obviously important that we do so, and I think that every party in the House recognises the need to ensure that local boards can, in fact, continue to delegate responsibilities, duties, and powers as they are currently able to. What the bill does is say the things that they can delegate and the things that they cannot.

It is important because the local boards, as others have said, have started to take shape, really. Their role is an important part of local government in Auckland. It is a co-governance arrangement between the local boards and the governing body. That is important. It is fair to say that local boards play different roles throughout Auckland, and that may well be appropriate. It is also fair to say that some have been more active than others and have probably been better advocates for their communities than others.

It is probably also fair to say that many local residents still do not fully understand the extent of the powers and responsibilities that their local board has, how important it is, and how different it is from the former community board. So this bill is important to allow those important parts of our local government structure in Auckland to get on and do their job. Of course, they are elected to do quite a large job. The areas that they cover are not insignificant. They are larger than most units of local government throughout New Zealand, and I think that is important. When we talk about local boards, people outside Auckland may not realise what large areas these boards cover and how many people they are actually working for.

Of course, we have just had the local government elections, and I want to acknowledge everybody who stood in the local government elections throughout New Zealand. It is always a big thing to do to put yourself forward as a candidate, to go out there, to talk about what you stand for, and to seek a mandate from the public. Many people throughout New Zealand did put their hat in the ring, and, of course, we now know who has been successful.

In terms of the local boards in Auckland, my colleague Phil Twyford spent some time talking about what has happened with them. It is fair to say that for this side of the House it is a very pleasing result, really—a positive outcome for the centre-left in terms of local boards, with some very strong tickets and some very effective people elected. I am a list MP based in Maungakiekie, and in our area we have two subdivisions, the Maungakiekie and the Tāmaki subdivisions. We have got three community independents elected in Maungakiekie—Brett Clark, Bridget Graham, and Simon Randall—and in the Tāmaki subdivision Josephine Bartley, Chris Makoare, Alan Verrall, and Obed Unasa all stood as Labour candidates for that board. Across Auckland there were some very, very strong candidates. Some are returning for a second term as local board members, and some are new and exciting people coming into the local board roles.

It is fair to say that the role does need further definition, and, as I said earlier, greater understanding is required from the public about the role of local boards, what they can and cannot do, and the extent of their powers. Auckland University of Technology’s Super City? State of Auckland research indicates exactly that. It says that although the super-city is functioning well in many areas, we are still seeing a lack of clarity about the roles of the council as a governing body and the local boards. So there are still some issues there.

I also want to note that one of the findings from that same report was that there were too few Māori, Pacific, and ethnic peoples and younger adults holding elected positions on the council and the local boards, and women urgently needed stronger representation on council-controlled organisations. Well, can I say that one of the really positive things about this election for local board representation in Auckland has been the large number of new Pacific representatives we have on local boards in the Auckland area. It is a very, very positive outcome. There was an even larger group, of course, who stood, some of whom were not successful, but I think—and I can see others across the House nodding—that this is a very positive thing because we want local government to reflect the communities that they represent.

Hon Judith Collins: Ha, ha!

CAROL BEAUMONT: I am sure that is hysterically funny for the Minister. I do not quite know why it is so funny. But, anyway, let us not divert on to that.

In my own area the local board has done a number of very positive things, and it has included what you might call environmental projects and a music and arts centre. It has funded community events, improved Onehunga Mall, and worked with sports groups to improve their sports facilities. But the one I want to particularly pick up on is the housing issue. The local board has worked very hard on the idea of a Housing Warrant of Fitness. There are many renters in the Maungakiekie-Tāmaki Local Board area, and it has a rental housing quality project to improve housing quality in rental properties in our area by working with stakeholders to explore options to achieve positive housing outcomes for tenants, particularly those in areas of higher deprivation. This warrant of fitness scheme will be the first of its kind in the country and is a joint project between environmental services and community development. I want to applaud our local board for that.

Can I say that this is in the context of a housing crisis in Auckland, something that I think my colleague Phil Twyford has been doing a very good job of holding the Government to account on. There is a housing crisis in Auckland. Homeownership is out of reach for most New Zealanders, which, of course, is contrary to what the local member of Parliament for Maungakiekie thinks. He thought that, actually, $130,000 for a housing deposit—

Hon Maryan Street: How much?

CAROL BEAUMONT: —that is $130,000—was not out of reach for most Aucklanders. Well, of course, he got rubbished up and down the country for that one, because, as we all know, that is an extremely large amount of money. He also talked about, I think, 1,100 affordable houses in the Maungakiekie electorate. Of course, there is no such thing. In fact, that electorate is actually probably one of the ones where housing prices are going up the most strongly.

Housing is a real issue in our area and I do want to applaud our local board for working on the Housing Warrant of Fitness issue. I would say that the Government needs to recognise—and I think it probably does and is starting to get the message—that people are very concerned about housing issues in Auckland. Housing affordability and access to decent-quality rental accommodation are two absolutely fundamental issues. Of course, another important issue is public transport. These are issues that certainly, on this side of the House, we take very seriously.

As I draw my comments to a conclusion, I again just reiterate that we do support this bill. It is necessary to ensure that the local boards can fulfil their function. I just want to make one final comment, for the record, about the local government elections, and that is to acknowledge the contribution of the former councillor in the Maungakiekie area Richard Northey, who has done an exceptional job and who has worked very hard with our local board. Thank you.

The ASSISTANT SPEAKER (Lindsay Tisch): Before I call the next member, can I just ask that you make some of the conversations a little bit quieter, please, because it is quite distracting.

DENISE ROCHE (Green): I rise to take a call for the Greens on the Local Government (Auckland Council) Amendment Bill (No 2) in this third reading. We will be supporting this bill. I guess you could call this just-in-time legislation decision-making, really, given that the elections were held on Saturday and within the next 2 weeks local boards across Auckland will be sworn in, in their first inaugural meetings. In order for them to be sworn in, they do need to have their delegations enshrined in legislation.

I would like to start by congratulating all those people who have been elected to local boards in Auckland, and that includes the Assistant Speaker Ross Robertson. I particularly want to congratulate Vernon Tava, Deborah Yates, Shirin Brown, Steve Tollestrup, and Saffron Toms, who are all Green Party members, who were elected to three different local boards in Auckland. Local boards are where democracy happens, and from our point of view they are a place for good green change as well, so we are thrilled that we have got competent, fabulous people in those roles in Auckland.

This legislation is about the decision-making powers and the delegation powers of those local boards. It is kind of a bit worrying to know that local board members, as well as our mayor and our councillors, were voted in with a very low turnout in these elections. It was around about 35 percent. It seems to me that there is a growing disconnect between communities and their governance, but it is interesting to note that in smaller communities there was a higher voter turnout. This time on Waiheke we had a 55 percent turnout, which is actually 9 percent down from last time, and Great Barrier Island had a 67 percent turnout. But that was out of 750 voters, basically. I also note that Rodney had the next-highest turnout, with 44 percent, and there are roughly about 14,000 voters there.

I think that what I am saying is that the closer people are to their elected representatives, the more engaged they are and the more likely they are to participate in their civil society, and that includes their responsibility of choosing their democratically elected representatives. Where I live we share a councillor with the Waitematā Local Board, and that had the lowest turnout. That was about 33 percent, but that local board has the highest number of voters in that area—47,000 voters in the Waitematā Local Board area. But the population is around about 80,000, so when you are looking at it as a ward, you are looking at an incredibly large area. If you look at what councillors and local boards have, you see that they do not have the same types of resources that MPs have. I wonder sometimes whether that is one of the reasons why there is a lower turnout for local government elections.

The role of local boards is to maintain democracy and to advocate for their communities. I disagreed with the Minister of Local Government when he said that it might be a good thing to roll local boards out to other places in the country, because if that is about replacing councils and their decision-making powers, then we are entering a time of reducing local decision-making, not increasing it. In my community we were opposed to the super-city amalgamation. We fought hard to get our own local board, and we got it because we rallied round it. We were going to have one member on the Waitematā Local Board. That was going to be our local representation until we fought against it. And to reduce the number of people who represent our communities by introducing local boards and getting rid of councils I think does everyone a great disservice.

What we have in Auckland is a co-governance arrangement, and I do get really cross with people calling local boards community boards, because they are not. I know, because I was on two community boards and I was on a local board as well, so I know the difference. This legislation that we have for local boards ensures that local boards can delegate some of their decision-making abilities. They can delegate them to staff and they can delegate them to members of their board or subcommittees of their board in order to get work done. I am assured that the governing body is now looking at delegating more powers to local boards, as well. Local boards are able to advocate for their communities, even on regulatory matters. They do not have the decision-making power, but they certainly can advocate, and that is what our communities want.

I guess that is why I have got really, really cross sometimes with the local board that we have had on Waiheke, which has been one of those boards that has not been as effective as others. It has not been doing what the Maungakiekie-Tāmaki Local Board has been doing in terms of addressing the issues in our community. It has said that, quite frankly, it would sit on its hands rather than get involved in negotiating and facilitating discussion around a proposal for a marine reserve on our island. It would rather sit on its hands—that is a direct quote. The chair, Faye Storer, has also said that it was not her role to advocate on regulatory matters over the biggest development to happen on our island in the last decade, which is the proposal for a marina at our gateway in Matiātia. I suspect that it was her decision as the planning spokesperson not to give a view from the board on that issue because of her role as the hearings commissioner and the potential for her not to be called for hearings commissioner duties as a result if she were to comment.

What we have now, though, is a new board that has been elected, so I want to congratulate those people. They are Paul Walden, Becs Ballard, Beatle Treadwell, John Meeuwsen, and Shirin Brown—a clean sweep of new blood into our community as our community leaders. They have already proven that they can engage with the people in our community. They have been listening. They have been picking up ideas. I feel quite confident that they will also be able to harness the creativity and expertise that we have in our community to deliver really good decisions that will keep us going forward on Waiheke. I am also pretty sure that they will be good negotiators, and that is the partnership between local boards and the governing body that makes up the council. It is a negotiation about not just delegating powers but also budgets and plans. I am really, really thrilled that we now have some talented people who will be able to negotiate for us, and I think they will do it effectively as well. I am also really pleased because this is the first time we have had somebody under the age of 40 on the local board for about a decade. In fact, when I was on the local board, I was the youngest, which is a bit scary when you think about it. So congratulations to Becs Ballard.

Local boards are important. I am pleased that we are supporting this legislation through the House. I do not believe that local boards are the cure-all for local government throughout New Zealand, but I am glad we have got them in Auckland and I am glad that we are going to see a change on Waiheke, where our local board is working for us. Thank you.

Hon PHIL HEATLEY (National—Whangarei): I also rise to support the third reading of the Local Government (Auckland Council) Amendment Bill (No 2). Members will be aware that on 31 October the transitional powers actually expire. So the powers that local boards are quite happily and successfully working under at the moment expire in a matter of days, and this bill replicates the current provisions. It does not add any new provisions. It does not change the way that the local boards operate. It simply extends into, well, you could almost say perpetuity what they do now, until Parliament decides to change that.

So the bill amends the Local Government (Auckland Council) Act to enable local boards to continue to delegate various functions and powers to committees of the local board or the council office. There are certain duties that they cannot delegate—for example, the duty to identify and communicate the interests and preferences of the people in the local board area. Of course, it is the board’s job to reflect its community of interest to the Auckland Council. It should not be able to delegate those powers, and it will not be able to. It cannot delegate powers to confirm or to modify or to propose in any way a by-law. That is a local board’s job; it cannot delegate that. The duty to adopt a local board plan for its area is something that local boards also cannot delegate. But those powers that they are currently delegating—and, as I say, are delegating quite successfully—need to continue after 31 October. So I support the bill.

TRACEY MARTIN (NZ First): Kia ora, Mr Assistant Speaker. I rise to provide New Zealand First’s contribution on the Local Government (Auckland Council) Amendment Bill (No 2). New Zealand First will be supporting the bill. First of all, can I also add my congratulations to Ross Robertson, who had a landslide victory in the Ōtara-Papatoetoe Local Board elections, 2000 votes ahead of his closest competitor. Knowing the job and knowing the man, I know that he will do an exceptionally good job at representing that local board area and the work that it must do. Can I also congratulate Penny Webster, who is the Rodney councillor, the returning local board members for the Rodney Local Board—Steve Garner, Brenda Steele, James Colville, Thomas Grace—and the new member, Phelan Pirrie.

It was interesting that Mr Twyford—and I just want to make some comments about Mr Twyford’s contribution to this bill with regard to the delegations and with regard to him minimising the true powers that the local boards have. Ms Beaumont, I think, better summarised, actually, the work that certain local boards have done. For example, although there certainly are delegations around parks, libraries, and reserves, the land-use delegations are often held by local boards.

The local boards do have budgets in their own right, which they use for things. The Rodney Local Board, for example, is funding night schools. In 2009 the Rodney Local Board area lost all night schools and all adult and community education with the cuts by the National Government to that particular budget line. The Rodney Local Board has funded, in the last financial year, the restarting of adult and community education in the Warkworth area. This year it will restart adult and community education in Helensville, and next year it will restart adult and community education in Wellsford. So those are the budget lines that the local boards have. It is also dealing with youth employment issues in its area. It is partnering with Ngāti Whātua Ngā Rima o Kaipara around a joint housing project where the Unitec will be coming into Helensville. They have purchased some of the houses from Hobsonville, which are now behind the college there. The Unitec will come in and, partnering with Ngāti Whātua, will be running its pre-apprenticeship building course in Helensville, because there is no public transport out of Helensville for anybody to go to any technical college.

So there are many, many things that the local boards do. They have done well in the 3-year period that they have been in place. They certainly need the delegations to continue, and, as my colleague Ms Roche said, particularly as the new board members will be sworn in within the next 14 days. However, I know that the governing body and the local boards in the non-hierarchal co-governance model, which is Auckland, is not a two-tier model. It is not a senior-lower model. We certainly do not need a parliamentary model, because this is about local communities, not about party politics. Again, I disagree with Mr Twyford. I think if you have a local ticket, that is fine, but I think it is deeply saddening that party politics from Parliament have actually ended up around what are local body electorates, which are supposed to be about communities and people who work hard in their communities representing them. So, again, I disagree with Mr Twyford on that. I think perhaps Mr Twyford needs to talk to somebody on the local board, outside his own party possibly.

I would recommend that during the discussions that the next governing body and the next local boards have around these delegations—and the movement of more boards coming to the Government asking for more delegations to be handed down to the local boards, which is a conversation that has been taking place over the last 3 years—that the staff inside the amalgamated city do not continue moves to have the chairs of the local boards created into mini-mayors. This is a move that is concerning around these other conversations. It might be administratively easier, but it is certainly not democratically better. So I think the new board members and new governing body members need to strongly watch for those sorts of moves.

But, at the end of the day, this system—although the two rural areas should have remained out of the amalgamated Auckland; Rodney should not have been pulled into Auckland, nor should have Franklin—for the more urban part of Auckland, this is working well. The two rural areas have been exceptionally effective in taking that voice to the governing body and making sure that we argue back for the things that our rural areas need, but there is a lot more work to be done there.

The true place that the Government and the Parliament need to set their minds to is around the council-controlled organisations. If this model were to be rolled out anywhere else in the country, firstly, I would strongly suggest they wait another 3 years and see how Auckland works. But the model around the council-controlled organisations must be altered. The governing body and the local boards seem to have lost control of what are called council-controlled organisations. So when this bill comes back, because I believe it will, then that is one of the things I hope to see in the amendments. But at this stage New Zealand First will definitely be supporting this bill.

MAGGIE BARRY (National—North Shore): I rise to speak to the third reading of the Local Government (Auckland Council) Amendment Bill (No 2). Having spoken in the previous readings and having had many of the points covered tonight, I am going to focus my call on really looking at some of the aspects of this that need to go through. I sit on the Local Government and Environment Committee that heard the single submission on this particular piece of legislation. Everybody supported it. The Auckland Council, which was the only group that submitted, was very happy about it. The Local Government and Environment Committee reported the bill back without amendment. All is good there.

The model of the local board is working well in Auckland. It needs to before it can work well anywhere else. Auckland is crucial to the success of New Zealand. The local boards being able to delegate authorities, which is the pretty narrow focus of this bill, is very much what it needs to do if it is going to continue its business. Those transitional powers that it has been operating under expire in 16 days, so, naturally, this piece of legislation has to progress through fairly rapidly. It does enjoy a certain amount of support from opposing members around the House, apart from a bit of griping around the way that local boards might or might not, you know, conduct themselves. I guess we all have our views on that. I am particularly surprised, I guess, that an individual could be elected to two local boards at the one time and serve on them. I think that is one of the things that surprised me the most out of the local body elections, which, of course, were concluded this last weekend.

So the transitional powers expire. This needs to be done. Everybody agrees with it. I will not take up any more time in the House than that. I commend this bill to the House. Thanks.

LOUISA WALL (Labour—Manurewa): Kia ora, Mr Assistant Speaker. Thank you very much for the opportunity to contribute to this Local Government (Auckland Council) Amendment Bill (No 2). I am not a member of the Local Government and Environment Committee, but I am a proud and staunch member of the Manurewa community. Obviously, I want to take the opportunity to congratulate all those who have been elected on to various boards, whether it be the local board, the district health board, the Wiri Licensing Trust, or the other governance boards that empower people to represent their communities.

Essentially, we are here because there is a transitional piece of legislation that enables local boards to delegate responsibilities to certain members. Without this piece of legislation going through, the irony is—well, I do not know whether it is an irony, but the reality is that those people who currently have delegations will keep them. It means that local boards cannot do the work they need to do. In some instances, those people are no longer on local boards. The person whom I have been working with in my area, whom I want to highlight, has been local board member Colleen Brown, who did not stand at the last election for the local board. I want to congratulate particularly Simeon Brown, who as a previous member of our Manurewa Youth Council has made the transition as a young person representing the youth specifically to now being a member of the Manurewa Local Board. But the irony of that is that Colleen has had delegations around developing the local alcohol policies for Manurewa. She is no longer on the board, so it makes it very difficult, I guess, for the board to delegate to somebody else—maybe.

What I do know is that local boards are actually performing a very important role in our communities. So I am really standing here in this third reading to support this piece of legislation because, from my perspective, local democracy is really important. When I look at my local board and the connection and relationship it has to the people of Manurewa, it is really important that it has all the tools it needs in order to do the best job on behalf of the people in each of our respective communities. For it to be able to have those tools means that it does not have to have full board meetings, which, essentially, would have to take place if this piece of legislation did not go through the House tonight. It is timely, given that we had the elections on Saturday, for us to have prioritised this piece of legislation. Obviously, for me, it is really important that we conclude this debate tonight and that we support this piece of legislation.

What I really wanted to highlight in my contribution tonight is a concern I have about voter turnout. It has been very interesting, I guess, to look at some of the different local body turnouts. I know that in Manurewa it is probably going to be as low as 25 percent. I think that is really concerning. But it is interesting to look at research from an associate professor who works at Massey University, Christine Cheyne, who has basically said that New Zealanders are able to identify with the district council or the mayor but beyond that there are really real gaps in people’s understanding about the people who represent them on either local boards or other such constituent groups. There is a poor overall understanding of the role and nature of local government. If people do not understand the significance to their lives, then they are not going to vote. So I think we have a particular challenge in some communities.

The other challenge I want to highlight is the complexity for some communities in the voting process. You have two types of processes that you use currently in local body elections. Obviously, for the local board, you just tick however many members of the local board are in your area. In our area we had to pick eight people, so you tick eight boxes. But for the district health board selections, if we want to use that as a comparison, it is a preferential voting system and you have to rank members. I think for some of our communities it is really confusing. I think we have to rethink how we present these democratic opportunities to our communities. Maybe for the boards where we want to tick the number of people we want on there, whether it be the local board or the licensing trust, they should be on a separate form. And possibly the district health board form should be—

Hon Anne Tolley: Could you talk to the bill.

LOUISA WALL: I am talking to the bill. Maybe the district health board form should be on its own and we should enable our communities to have different mediums to be able to engage in the process.

Obviously, we support the bill. It is a piece of legislation that has unanimous support across the House. We realise that it is a piece of legislation that needs to go through so that our local boards can do the job they are empowered to do. I commend the bill to the House. Thank you.

PAUL GOLDSMITH (National): I wish to make just two points on this legislation, the Local Government (Auckland Council) Amendment Bill (No 2). The first point is that this legislation is necessary to allow local boards to continue to work as they have done for the past 3 years. The second point is that as the National list MP based in Epsom I have worked closely with three local boards, particularly with Desley Simpson and her group in Ōrākei, Greg Moyle in Waitematā, and Tim Woolfield and Lee Corrick in Maungawhau. I was glad to see them all re-elected on Saturday, and they are doing great work in the community. Amongst the many benefits that there are for the super-city there is the real risk of a lack of responsiveness to local communities, so an effective local board is an important conduit between the community and the vast bureaucracy. On that basis I think good-quality local boards are important. This legislation continues the work that we have done, and I commend this bill to the House. Thank you.

The ASSISTANT SPEAKER (Lindsay Tisch): I understand the next call is a split call.

DAVID SHEARER (Labour—Mt Albert): Yes, that is right, a split call with the Green Party. I would also like to congratulate all those successful candidates who stood in the local board elections. We had some very good results from that, and as some of my colleagues have already pointed out, a number of the centre-left groupings—Labour-Greens centre-left groupings—were successful in getting across and getting into local boards. We look forward to some progressive policies being pushed through the local boards under their leadership.

I would also like to acknowledge the work of Richard Northey, who worked very hard as a councillor, and I also congratulate Chris Darby, a friend of mine who has made it as a councillor on the North Shore. I think he will provide a real boost to the council with the passion and drive that he has for Auckland.

The unified Auckland City has been a success. We look back to 3 years ago, when there was a great deal of trepidation about what was going to come about when all those local councils were amalgamated. We look back now and it is almost difficult to believe that there was so much naysaying and doomsaying about where we were going to go with that. The change and the positive outcome of the Auckland Council has been a response, really, to a couple of things. One has been the effective leadership of the Auckland Council. I would like to pay tribute to and congratulate Len Brown on his re-election and acknowledge the drive, energy, and passion he has shown for bringing the various components of Auckland together into one super-city and having that functioning as it has.

It has had some huge successes in the work that it has done: the Auckland Unitary Plan, which has been controversial, is still open for submissions, but will, nevertheless, transform the way that Auckland looks at itself and the way it plans its future; the unification of the rates and the various other types of administrations that were so divided and split and differentiated between the various councils and that have been brought together in one entity; and the council-controlled organisations, and I think there is still some work to be done around those. But that is all a tribute to the Auckland Council—the fact that it has been able to bring that together.

The second thing that I think has been effective in making sure that people still have a voice is the local boards. I have to say that in the first year or two I think they struggled to find a place for themselves and how they were going to operate and how they were going to represent their communities adequately. But over time they have bedded in their role. I still think that their role is somewhat superfluous. It is not linked in strongly enough to the council. It is still in some ways out to one side. They are seen somewhat as the poor cousins of the actual council itself. But, however, they have been successful in being the focus for advocacy, for ensuring that local issues are being brought to the attention of the council, and they have acted on things themselves.

I would like to congratulate those local boards in my electorate of Mt Albert that have done so well, the Whau Local Board and Albert-Eden Local Board, and wish them all the very best in the next 3 years.

EUGENIE SAGE (Green): The Green Party will be supporting the Local Government (Auckland Council) Amendment Bill (No 2) and it joins with others in congratulating everybody who stood for election this month, whether they got elected or not. It is a lot, putting yourself out there to be decided on by voters, so congratulations to everybody who stood, and congratulations to those who were elected and will do their best to represent their communities over the next 3 years.

Auckland’s local boards were set up with the express purpose of enabling democratic decision-making by and on behalf of communities within their local board area, but they cannot do that very well unless they have a strong mandate from voters. The range of concern that has been expressed about the very low voter turnout in these local body elections is obvious, because that does undermine democratic decision-making and the mandate that the boards have and that councils generally have. In Auckland we saw the turnout drop from 55 percent to 33 percent, one of the lowest on record.

Just as smaller rural councils tend to have a higher voter turnout than larger urban ones, so it was with the smaller local boards in Auckland. They had a much higher turnout than some of their more populous neighbours. Two of the standout performers here were the Great Barrier Local Board and the Waiheke Local Board—67 percent of the electors on Great Barrier Island voted for their local board and 55 percent of the more than 6,500 electors on Waiheke Island voted for their board. Yet when you compare that with some of the larger boards such as Manurewa, where you have an electoral population of over 53,000, the turnout there, as Louisa Wall noted, was quite low—around 29 percent.

So it is for this reason that the Green Party will likely oppose the proposals to amend the Local Government Act to enable local boards to be rolled out in other parts of the country where there is currently a cap on using local boards—that they can be used only in communities of over 400,000 people if a unitary authority is established. The local boards, as Phil Twyford noted, have substantially lower powers—smaller powers—than the councils that they replace. They can certainly recommend by-laws, but they cannot sign those off. They have an oversight and a recommendatory power in relation to budgets, but they are not the main decision maker.

So the approach that the National Government seems to have is that bigger is better when it comes to local councils. We do not agree with that because bigger organisations tend to be more remote from electors, there is less ability for electors to see that they can influence decision making and influence change, and people tend to feel more alienated from big, centralised agencies. That is why this move to have local boards replace councils and have a big unitary authority in the proposed changes to the Local Government Act to be rolled out later this year is of major concern, because that will not necessarily improve democracy or lead to more voter engagement.

There have been a range of commentators on the low turnout. Associate Professor Christine Cheyne from Massey University was calling in this morning’s Dominion Post for an independent inquiry to address this deepening malaise affecting local elections. Certainly, the Justice and Electoral Committee looks at turnout after each election, but I think we have got to do much more because we have a very casual attitude to democracy in New Zealand. Although electronic voting is going to be trialled in 2016, that is not a silver bullet. We need civics education in schools so that students understand the institutions of democracy, and so that they get into the habit of voting when they turn 18. We need a much more proactive effort by councils to publicise the fact that there is an election. I commend the Hamilton City Council. Its local electoral officers were out on the street with ballot boxes, encouraging motorists to drop their ballots in. It estimated it got an extra 1,000 votes by doing that. But on some councils’ websites it was not even obvious that there was an election. We need to do much more to improve the turnout. Local councils are a way of doing that, not just changing councils to boards.

JAMI-LEE ROSS (National—Botany): I just want to round out the Government’s contribution on the Local Government (Auckland Council) Amendment Bill (No 2) by thanking the Opposition for some of the comments that have been made about the bill. I want to particularly thank David Shearer, because today David Shearer admitted, on behalf of the Labour Party, that the Auckland Council has been a success. I just want to put that on record because David Shearer might have forgotten that the Labour Party spent many, many hours in this Chamber opposing the Auckland Council legislation. It kept the House going into the early hours of the morning opposing the legislation for the Auckland Council, and now it is claiming it is a success. So I just want to congratulate the Labour Party on coming full circle and agreeing with us that the Auckland Council reforms were a success. Rodney Hide will be sitting at home with his new babies up in Auckland, thanking David Shearer for that grand admission.

I also want to acknowledge Louisa Wall for her comments, because she is right—local boards do play an important role. In Manurewa right now, deep Labour territory, the centre-right has just had a clean sweep on the Manurewa Local Board, which just gives an indication as to how the people of Manurewa are feeling about local government.

I am going to be brief and just finally say that this bill simply continues the delegation authority for local boards. Local boards have been a success story in the Auckland Council make-up, where local communities can have a real say. I am just glad the Opposition now agrees with us that the Auckland Council was a good change, and long may it be a success for all Aucklanders.

Bill read a third time.

Bills

Administration of Community Sentences and Orders Bill

Third Reading

Hon ANNE TOLLEY (Minister of Corrections): I move, That the Administration of Community Sentences and Orders Bill be now read a third time. This bill makes substantive and technical changes to the Bail Act 2000, the Sentencing Act 2002, and the Parole Act 2002 in order to remove barriers to the effective and efficient management of offenders serving sentences and orders in the community. It has been before Parliament since October 2011. The Law and Order Committee considered it last year and reported it back to the House with several improvements. I would like once again to thank the Law and Order Committee for the sensible changes it has made.

Although this bill is generally concerned with matters of a technical or administrative nature, I believe that the cumulative effect of its amendments will be a considerable improvement in the overall management of these sentences and orders. For instance, the bill will contribute to the goal of improving public safety by other things: better aligning electronic monitoring conditions with the electronic boundaries of monitoring equipment, making it easier to hold offenders to account if they fail to comply with a community-based sentence, and addressing some technical problems with extended supervision order provisions. The bill also reduces the administrative burden probation officers face and empowers them in other ways to focus more on the rehabilitative opportunities available to offenders and the safety of the public. For example, they will be able to approve basic work and living skills courses for offenders on community work without having to apply to the court.

Other amendments are required to clarify procedures where provisions are ambiguous or have had unintended consequences. During the Committee of the whole House, I tabled amendments that were necessary to resolve a few commencement and minor drafting issues. I wish to thank members for their cooperation in seeing that Parliament’s intention is appropriately reflected in the drafting of provisions in this bill.

This bill significantly improves the effective administration of sentences and orders in the community. In doing so, it improves the safety of the public, contributes to the Government’s goal of reducing reoffending by 25 percent, and delivers better public value. I commend this bill to the House.

KRIS FAAFOI (Labour—Mana): It is a pleasure to be able to take a call in the third reading of the Administration of Community Sentences and Orders Bill. It is a bill that Labour continues to support. As the Minister of Corrections did in her contribution to this debate, I would also like to thank other members of the Law and Order Committee for the way in which we worked together. Unfortunately, I am no longer a member of the Law and Order Committee, but this is definitely one of the pieces of legislation and one of the times where we worked very constructively together from across the Parliament to make sure that this bill was a good bill and was improved at the select committee stage.

It was a bill that we did make some changes to, and I agree with the Minister that we made some very sensible changes to the bill. I would also like to thank those officials and members of the Department of Corrections who came along and gave us some very good, constructive, and practical submissions to the bill so we, as members of Parliament, could understand some of the technical realities of what the changes in the bill contained.

As the Minister said, this piece of legislation aims to make changes to the barriers to effective management of home detention and community-based sentences, electronic monitoring, and parole and extended supervision orders. On this side of the House, we certainly think, in terms of fiscal and rehabilitative purposes, that we should be looking at the use of more home detention, when it is suitable. Let me be clear: there certainly will be occasions when someone is not suitable to be given a community-based sentence. They would have committed some of the worst crimes, and those people should, as they are now, be put into protective custody to make sure that they are not at large and to make sure that the public is safe from any dangers that they may pose. But we believe that we should look at more use of community-based sentences in the future to make sure that we can also fiscally afford to make sure that we punish people and rehabilitate them, but also—to use that word “rehabilitate”—to make sure that it is effective.

Can I just draw on one submission made by the Salvation Army to the Law and Order Committee where it quoted some Ministry of Justice figures. The submission said that “23 per cent of those on home detention in 2009 were reconvicted in the following 12 months. Conversely, 52.6 per cent of those who served a custodial sentence in 2009 were reconvicted in the following 12 months.” It went on to say that over that period recidivism rates in New Zealand have remained largely the same. We have the Salvation Army coming to us and telling us that the figures from the Ministry of Justice have shown that for those given community sentences, those who are given home detention, their recidivism rate is at least half that of those who are given a custodial sentence. There is hard evidence that community-based sentences are very effective at making sure that those who have been given a sentence do not go out and reoffend. I think all parliamentarians would agree that that is certainly one of the things that we wanted to get out of sentencing and the Department of Corrections—to make sure that there are fewer victims and that there is less reoffending.

The Deputy Prime Minister, Bill English, himself has said that prisons are a moral and fiscal failure, and I think it is important that the department takes an evidence-based approach to what works when it comes to the rehabilitation of prisoners. I have already mentioned those figures that the Salvation Army dug out for us at the select committee hearing. I would like to commend the Deputy Prime Minister for making that comment, because he knows that we cannot continue to spend at the rate we do with corrections, but also we cannot keep locking people up and, as those figures have shown, have them come back and reoffend at a rate of 52.6 percent, which the Ministry of Justice figures show for 2009. We have to find a way to make sure that those people to whom we are giving sentences reoffend less, and also we have to make sure that we can find a way to make the corrections system much more efficient in terms of the money that we are putting into it.

I do want to—as the Minister said—talk about some specifics in the bill that we on the select committee thought were good improvements. They are around being able to convert a proportion of a community sentence into training. I think it is something that we on this side of the House want to make sure there is an option to do, for those people who are either serving a community sentence or in prison themselves. This bill provides that a probation officer may direct that up to 20 percent of the community work sentence of at least 80 hours be spent training in basic work and living skills.

I do not think anyone on this side of the House would argue with that—that you can convert some of that time that you are spending on a community-based sentence into training, to be able to prepare those people who are on that sentence, for the time when they are not forced to stay in their residence because of the sentence that they have been given. I think that is certainly one good thing within this bill that will help those who are serving community sentences to get back on the straight and narrow. As I have said, and I am quoting this repeatedly, those Ministry of Justice figures show there is less reoffending by those who are on community-based sentences, and hopefully some of that training that is made available to them, by being able to convert that time, will help augment that and make the rehabilitation rate much better and the reoffending rate much better as well.

I just wanted to finish off on this by saying that we on this side of the House want to make sure there is an evidence-based corrections system. We do believe that there should be much more of a move towards community-based sentences. We believe that those community-based sentences for the appropriate people who are given those sentences will lead to less reoffending. Those Ministry of Justice figures have stated that, and I think everyone in New Zealand will want to make sure that while we manage the risk of community-based sentences, if we can get less reoffending and fewer victims, that is what everybody wants.

Once again, thanks to those officials who came and gave submissions to the Law and Order Committee. I think one of the more interesting submissions to the select committee was around some geometry, and the difference between a circle and a square, in terms of the technology that monitors those people who are on electronic monitoring and who can technically be outside the residence where they are meant to be, but still inside the digital or electronic monitoring that is there. This Administration of Community Sentences and Orders Bill aims to make sure that those technicalities are looked after, and we certainly hope that those who are supposed to be where they are will continue to be where they are, with the technical changes in this piece of legislation. So, once again, thanks to those officials. We are very happy to continue to support this bill.

JACQUI DEAN (National—Waitaki): Thank you very much for the opportunity to speak on the third reading of the Administration of Community Sentences and Orders Bill. I am really pleased that we have now reached the third reading stage of this most excellent bill, which makes some substantive but also technical changes to the Bail Act, the Sentencing Act, and the Parole Act. What this bill will do is remove barriers to the effective and efficient management of offenders serving sentences and orders in the community. The reason why this is a pretty significant bill is that it is part of a suite of work being done in the justice sector with a very strong focus on rehabilitation and “reintregation”—I still have not got that right; you know what I mean—reintegration, that is it, of offenders into the community. I know I jest, but actually it is not a laughing matter. It is actually incredibly important that the good work done by the Hon Judith Collins and the Hon Anne Tolley in this field is given effect to in this legislation—

Hon Maryan Street: Not tonight. No contribution tonight.

JACQUI DEAN: —because what is really important—no, not tonight; we will not finish it tonight. The member is quite correct. We probably will have to finish off the third reading another night, but we are making a very good start. The point that is really to be made around this is what do we want out of our criminal justice system? We want offenders to be brought to trial in a timely manner, and, yes, we are doing a lot of work around courts reform and judicial reform. While prisoners are in custody we want to give them every opportunity to gain those life skills and those literacy and numeracy skills that they may be lacking. We want to return them to the community in as good a shape as we possibly can.

This bill forms a great part of the “reintre”—oh, again that word; why do I use that word—the reintegration of offenders back into the community. As Kris Faafoi mentioned in his contribution, it is as simple as things such as realigning the boundaries for electronic monitoring. Formerly, the technology meant that a boundary was always going to be like this, and so on an offender’s property, if the boundary is like this, but actually the letterbox is out here, he is always going to breach his bail conditions by going outside that area. So this bill is about improving the efficiencies around that, and I commend it to the House.

ANDREW LITTLE (Labour): It is a pleasure to take a call on the Administration of Community Sentences and Orders Bill. I think, as the last speaker, Jacqui Dean, said—or if she did not say it, she meant it—how we administer sentencing and our criminal justice system is very important. Much work has been done over many years, actually starting, I think, under the last Labour Government, and with Phil Goff, who was a very energetic, very enthusiastic, and very accomplished Minister of Justice. There has been a transformation in sentencing and the approaches we take to sentencing, but, of course, these things are always subject to refinement in the light of experience. Prior to this bill coming to the House, we have seen that there are areas of the community sentencing approach that can do with improvement, amendment, and refinement. This bill seeks to do that, which is largely why we support it, but we also do that in the context of although wanting a criminal justice system and the sentencing approaches that we take that reflect a community opprobrium and the need for penalty, ultimately what we want is a corrections system and a justice system that effectively do what the corrections system says it is going to do. It changes behaviour and it changes approaches and people’s behaviour, so that those who have offended against the criminal statutes, and, with it, society’s expectations, have the benefit not only of reflecting on their actions but of changing their approaches and their behaviour too.

There is no question that recidivism remains a very difficult issue and a common outcome to our criminal justice system, so more has to be done. The more that we can have a criminal justice system that takes the vast bulk of offenders—who are not inherently bad people but are people who have a time in their lives, often when they are younger, because these are often younger men who just do the wrong thing and make bad choices, and who sometimes do things that are very harmful to others—and provides them with the means to transform themselves, transform their lives, and make better choices, then that would be better for all of us. It would be better for them, it would be better for the community, and, ultimately, it would be better for the taxpayer and their back pocket. So anything that we can do to promote and enhance our community sentences, such as leaving people in the community with appropriate support but paying their dues to society, is a good thing. It is having the ability to amend community sentences. When a person who has been sentenced to one then finds himself or herself sentenced to another, amending the original sentence so that we can draw those two together is, of course, a very good thing, and that is what this bill does.

This bill has, at least, had the benefit of going through and achieving agreement between those of us across the House, and I think that is reflective of the very value and the very principle that we want to support and annunciate in a coherent and modern criminal justice system—a system that takes people who, for whatever reason, have offended and gives them the chance to understand the community’s expectations of them as citizens and to make them good and worthy citizens as well. The more we can do that and the less we resort to the barbaric and, frankly, continually failing approach of throwing people in the old clink, leaving them there, and expecting that after 3, 4, or 5 years somehow they are going to be a transformed citizen—we know that that approach is increasingly failing. Community sentences play a very important role in our criminal justice system and in our suite of sentences that are available to judges. The more we can do to make them work and make them effective, then the better it is for the justice system and for every New Zealand citizen. The more we can have a system that ensures that people can fulfil or at least reach their potential, even after having offended against the community, then that is good for all of us.

So on that basis we support this bill. It is a very good bill. I acknowledge the work that the Law and Order Committee has done on achieving consensus and bringing the bill back and, hopefully, making yet another refinement and taking another step that gives us something closer to the type of model of criminal justice system that we want and that we aspire to.

Bill read a third time.

Bills

Insolvency Practitioners Bill

Second Reading

Debate resumed from 26 September.

The ASSISTANT SPEAKER (Lindsay Tisch): Members, when we were last on the Insolvency Practitioners Bill, Jonathan Young had the call. He has 6 minutes and 30 seconds remaining to speak if he so wishes. Well, I am afraid he is going to have to wait until next time because the time has come for me to leave the Chair.

Debate interrupted.

The House adjourned at 10 p.m.