Wednesday, 16 October 2013

Wednesday, 16 October 2013

Wednesday, 16 October 2013

Mr Speaker took the Chair at 2 p.m.

Prayers.

Motions

Man Booker Prize 2013—Eleanor Catton

Rt Hon JOHN KEY (Prime Minister): I seek leave to move a motion without notice in recognition of New Zealand author Eleanor Catton for winning the Man Booker Prize.

Mr SPEAKER: Is there any objection to that course of action being taken? There appears to be none.

Rt Hon JOHN KEY: I move, That this House congratulate Eleanor Catton on winning the Man Booker Prize. This is a hugely significant achievement on the international stage for a New Zealander. The Man Booker Prize is literature’s most sought-after prize. It is made even more extraordinary by the fact that Eleanor Catton, at 28 years of age, is the youngest ever author to receive the prize. In fact, she was born in the same year that the last and only other New Zealand author, Kēri Hulme, won the Man Booker Prize in 1985 with The Bone People. Today’s win will be a tremendous boost for young New Zealanders in the arts. The judging panel said that Eleanor Catton’s winning novel, The Luminaries, at 832 pages, “requires a huge investment of time from the reader but the dividends it offers are astronomical”.

New Zealand generally celebrates our sporting successes on the international stage with enormous vigour. We should be celebrating this success today with equal enthusiasm, as it is a truly remarkable achievement. It also comes at the same time that young Auckland musician Lorde currently holds the No. 1 US chart spot for her song “Royals” at just 16 years of age. It is exciting and inspiring that our ambassadors in the arts and culture who right now hold the attention of the world are fiercely intelligent and ferociously talented young women. Their successes are testament to their skills and hard work, and an inspiration for all New Zealanders.

Hon DAVID CUNLIFFE (Leader of the Opposition): I rise on behalf of the Labour Opposition to support the motion. Today a young Kiwi has made history, and we are all so proud of her for that. I join the Prime Minister, parties from across the House, and Kiwis everywhere in congratulating young Kiwi author Eleanor Catton on winning literature’s most prestigious Man Booker Prize. From the very beginning of what was originally called the Booker Prize there was just one criterion. The prize would be for the best novel, in the opinion of the judges. Forty-two years later that is still a key sentence in the rules, and that is exactly what Eleanor Catton has produced.

Who better to sum up Eleanor’s wonderful work than the judges who saw fit to bestow upon her this fantastic prize? They not only praised the work as a whole but saw a maturity in the text that belied the author’s age, stating: “you read every sentence and you are astonished by its knowledge and its poise.” They added that it was “a dazzling work”, “luminous” and “vast”.

Eleanor now joins a list of the world’s greatest writers that includes names such as Iris Murdoch, Salman Rushdie, Margaret Atwood, Kingsley Amis, and, of course, our own Kēri Hulme. There are some wonderful parallels in two other Booker Prize winners. Eleanor’s win comes 28 years after New Zealand’s Kēri Hulme won the same prize for the The Bone People in 1985, the year Eleanor was born. Kēri Hulme is, of course, a proud West Coaster, and The Luminaries is set in Hokitika. [Interruption] Yes, Damien—Hokitika, a fact our own MP for West Coast - Tasman, Damien O’Connor, was quick to jump on. That is indicative of what prizes do for authors and also for their home, their places that inspire their work.

But Eleanor Catton has been quick to point out what it is that New Zealand has given her too. She is a graduate of the International Institute of Modern Letters at our own Victoria University. This is the programme that Bill Manhire established, which has produced a number of great New Zealand writers, including Emily Perkins, Barbara Anderson, Laurence Fearnley, and, of course, Elizabeth Knox. The Luminaries is also published by Victoria University Press, and today we should also acknowledge Fergus Barrowman, who is the publisher at Victoria University Press.

Today Eleanor has become a wonderful young ambassador for New Zealand, an inspiration to young writers, and a source of enormous pride. We congratulate her warmly.

CATHERINE DELAHUNTY (Green): I rise to support the motion on behalf of the Green Party. This is wonderful news—once again a woman from Aotearoa New Zealand has won the Man Booker Prize, and at 28 years of age. There are 832 pages of vibrant, intricate, and experimental writing in The Luminaries, which, like Kēri Hulme’s magnificent opus The Bone People, extends the definition of creative literature and takes the prize. Although she was born in Canada, Eleanor Catton came to New Zealand when she was 6 years old and is rightly counted as a Kiwi. I am really looking forward to reading this. I was particularly captivated by the New Zealand Herald’s description of the plot: “a great, big, glorious story of shipwrecks and swindlers, opium addicts and prospectors, secret caches of gold stitched into gowns, fate and fortune, greed, hope, and desperation.”—just like Parliament, really, only based in Hokitika.

The Green Party salutes this young writer for winning what is possibly the most prestigious literary prize in the world and adding her name to the list of writers from Katherine Mansfield onwards who have taken Europe by storm. This book must have been a marathon to write, so Eleanor should be recognised as both an athlete and a writer. Once again a writer has written about our history and identity in a manner that has universal meaning, mystery, and delight. Congratulations, Eleanor Catton, and may every Kiwi author be inspired by her success.

Rt Hon WINSTON PETERS (Leader—NZ First): It should have been this case for the America’s Cup, but it did not happen. Congratulations to Eleanor Catton for winning the most prestigious literary award in the world and becoming the youngest winner in the history of the Man Booker Prize. We join in the adulatory comments of other speakers in this House. It was said once that the trouble with being a publisher is that too many people with half a mind to write a book do so, which explains half the political autobiographies we read around the world. This is not the case with The Luminaries, Eleanor’s second novel—

Hon Bill English: We’re waiting for yours.

Rt Hon WINSTON PETERS: No, when I write a book, it will be a best seller. If you are kind to me, I will leave out the part about you, which will double its publication if I let it go—

Mr SPEAKER: Order! Do not bring the Speaker into the debate.

Rt Hon WINSTON PETERS: This is not the case with The Luminaries. Eleanor’s second novel was described by the judges as a dazzling piece of work. Eleanor is an inspiration to all Kiwi writers. Let us hope we see more young Kiwis aspire to her astonishing success.

Hon PETER DUNNE (Leader—United Future): On behalf of United Future I want to join with other speakers in congratulating Eleanor Catton on winning the Man Booker Prize for The Luminaries. Her history has been rehearsed. She is one of the youngest winners, born the year the last New Zealand author achieved this significance. The Luminaries is a phenomenal piece of work at 832 pages long. If you heard Eleanor’s acceptance address earlier today, you would have got a sense of the flow of the novel from just the very way in which she spoke and described some of the influences that led her to write about gold and pounamu, about the West Coast, and about the particular situation of the South Island of New Zealand.

The great tribute to her is that a very specific regional novel comes out as the best in the world. When you look at the competition, the various other authors, all with established reputations, whom she was up against, the challenge was an almighty one, and she succeeded. Not only is she young but she is a very new novelist. The Luminaries is only her second novel. To achieve this success this early bodes extremely well for her future.

It is a great occasion for this Parliament to celebrate a New Zealander’s success in the literary field. As the Prime Minister said, we do it regularly for sportspeople. This is an important occasion in its own right. It deserves to be recognised, and Eleanor deserves to be awarded the accolade of being our best writer, someone we can be proud of, someone whose success we welcome and appreciate, and someone whom we wish extremely well for the future in her career.

Motion agreed to.

Questions for Oral Answer

Questions to Ministers

Economy—Reports and Forecasts

1. PAUL GOLDSMITH (National) to the Minister of Finance: What reports has he received about forecasts for the New Zealand economy and how are these being reflected in levels of business confidence?

Hon BILL ENGLISH (Minister of Finance): We are now regularly seeing reports showing that the economy is continuing to strengthen, producing more jobs and higher incomes. In particular, an authoritative source is the International Monetary Fund’s annual World Economic Outlook, which forecasts that New Zealand would this year and next year have the fifth-highest growth rate out of 35 developed economies. New Zealand’s growth rate was picked to be 2.5 percent for each of the next 2 years. The average growth rate for advanced economies was less than half that, at 1.2 percent. Closer to home, the BNZ-Business New Zealand Performance of Services Index rose to its highest level since the survey began in 2007. The September ANZ Business Outlook shows business confidence at its highest level since March 1999.

Paul Goldsmith: In light of improving business confidence, what reports has he seen about staff-hiring intentions amongst businesses?

Hon BILL ENGLISH: Of course, it is important that high levels of confidence convert into higher levels of jobs, but if you do not have the confidence first, you certainly will not get the jobs following. The ANZ report I referred to in my previous answer says: “Employment and general investment intentions remain rock solid at +19 and +20 respectively”—that is, a net 19 or 20 percent of businesses are going to expand their hiring and their investment. TradeMe’s vacancy data shows that vacancies advertised on that site rose by 9.6 percent in the last quarter, compared with the previous quarter. The head of TradeMe jobs was quoted as saying: “We’re becoming confident that the buoyancy in the Kiwi job market isn’t a temporary affair … It reflects an increasing confidence as employers look to boost investment in new staff.”

Paul Goldsmith: How is an increase in employment intentions likely to flow through to wage growth?

Hon BILL ENGLISH: The Government has been very focused on higher incomes as well as more jobs, through what have been some pretty challenging economic circumstances. Nominal wage growth remains subdued, but this needs to be seen in the context of subdued consumer inflation. The New Zealand Income Survey, released a couple of weeks ago, showed that the median weekly wage and salary income increased by $844, or 4.8 percent, between June 2012 and June 2013. Wage growth has to be based on business confidence, improved profitability, and good economic momentum.

Paul Goldsmith: What are the latest figures on inflation, and how is that likely to affect households and the wider economy?

Hon BILL ENGLISH: The CPI came out today showing a rise of 1.4 percent in the year to September. About half of the increase was attributable to higher petrol prices and seasonally higher vegetable prices. The long period of restrained inflation and low interest rates has been significant in helping New Zealand households get on top of their debt and enjoying the benefit of real increases in wages, even though they have had relatively low wage increases. This is a lot better than the picture just 5 years ago, where inflation was running at 5 percent instead of 1.4 percent, and first mortgage rates were 10.5 percent, instead of 5 percent when Labour left office.

Hawke’s Bay Water Management—Minister of Conservation’s Involvement

2. Hon DAVID CUNLIFFE (Leader of the Opposition) to the Prime Minister: Does he stand by the statement made on his behalf on 25 September “The Minister was aware that the Department of Conservation was working on a submission. He was not aware of the content of the leaked draft submission until Tuesday, 17 September”?

Rt Hon JOHN KEY (Prime Minister): Yes.

Hon David Cunliffe: How can the Prime Minister stand by that statement, given that Nick Smith’s 20 May weekly report discussed submission content and said that the Department of Conservation had concerns with the approach to nitrogen and phosphate monitoring, 3 months before the Minister claimed to know?

Rt Hon JOHN KEY: I do not have that particular report in front of me, but what I do know is that the weekly report of 29 July did indicate, within two sentences, that there was a lodging of a submission to be made in the name of the director-general, and on 31 July the Minister received the report.

Hon David Cunliffe: I seek leave to table a summary of the Minister’s weekly reports, which the Prime Minister clearly has not been briefed on by his Minister—

Mr SPEAKER: Order! Leave is sought to table that document. Is there any objection? There is objection. [Interruption] Order!

Hon David Cunliffe: I raise a point of order, Mr Speaker. There may be some confusion—

Mr SPEAKER: Order! Is the member seeking now to table another document?

Hon David Cunliffe: I am seeking to table the cover sheet to the question for written answer that attached the weekly reports from the honourable Minister—

Mr SPEAKER: Leave is now sought to table—[Interruption] Order! Leave is now sought to table the cover sheet. Is there any objection? No, there is not. It can be tabled.

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

Hon David Cunliffe: How can he continue to support Nick Smith, given Dr Smith’s claim that he first asked the Department of Conservation to give him a copy of the submission on 29 July, and when his 24 June weekly report states that he required it to be approved by him on 17 June—17 June?

Rt Hon JOHN KEY: Because I am advised that that is correct.

Hon David Cunliffe: I seek leave to table the particular extract from the weekly report, which shows that the advice the Prime Minister received—

Mr SPEAKER: Leave is sought now to table—

Hon Dr Nick Smith: Point of order.

Mr SPEAKER: The member is seeking to table a document. Is the member seeking clarification?

Hon Dr Nick Smith: Point of order.

Mr SPEAKER: Is the member seeking clarification?

Hon Dr Nick Smith: Point of order, Mr Speaker.

Mr SPEAKER: No, no. Order! The point is that I am dealing with a point of order to table a document. I will put that leave, and then if the member wants to raise a point of order, that is perfectly in order. Leave is ought to table the particular document outlined by the Hon David Cunliffe. Is there any objection? There is not. It can be tabled.

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

Hon Dr Nick Smith: I raise a point of order, Mr Speaker. Is it proper to seek leave to table documents that have been provided by way of written answer to a question? Because both documents that the Leader of the Opposition has sought leave for have been provided to the House by way of answer to a written question.

Mr SPEAKER: I am happy to clarify that. If I am clear that the document has already been clearly made available—and I expect members when they seek leave to table a document to make that known to the House—in that case there seems to be little point in tabling the document. On this occasion Mr Cunliffe sought to table two documents. I was unaware whether they were freely available, and on that basis I then put the leave to the House. It is for the House to determine.

Grant Robertson: I raise a point of order, Mr Speaker. Just to clarify the point for the member, the Prime Minister, in answering both the supplementary questions that David Cunliffe asked, said that he was unaware of the material. That is the practice in which you have previously said it is OK to table documents—to help clarify matters in the House.

Mr SPEAKER: I will just tidy that up for the benefit of the member, because it is not strictly a point of order. What we have said in the past is that documents can be tabled if they further inform the members of the House. As to whether a Minister stands up and says they have no knowledge of that, etc., that is not the purpose of tabling a document; it is about giving further information to members.

Hon David Cunliffe: I raise a point of order, Mr Speaker. For the information of the House I can confirm that the information that has just been tabled by leave was, in fact, received by the Opposition only this morning and is still subject to the standard 3-day stand-down before its publication as a question for written answer.

Mr SPEAKER: I thank the member for that. Leave was put for the documents to be tabled. That is the end of the matter.

Hon David Cunliffe: How can he have confidence in Nick Smith when the Department of Conservation raised water quality concerns in May—May—and told Smith that it was preparing a submission, Smith asked to approve it in June, and yet the same Minister claimed to know nothing about it until September?

Rt Hon JOHN KEY: I think that the member is attempting to conflate and draw inferences from a whole lot of material, which he cannot. The simple facts of life are that on 29 July at his weekly meeting he received a report that had two sentences in relation to the submission. On 31 July he received the report. And I refer the member to Doris Johnston, the Deputy Director-General of Conservation, who said, amongst other things, that “He never saw the draft submission that everyone’s been talking about” and “the Minister did not play any role in my decision-making.” So the member can conflate things as much as he likes, he might bamboozle his Labour caucus, but he will not—

Mr SPEAKER: Order! Order! That answer is quite sufficient.

Hon David Cunliffe: How can the Prime Minister have confidence in Nick Smith, given Smith’s claim in response to a question on notice that he first knew that the Department of Conservation was preparing any submission was 29 July, given that the Minister’s weekly reports show he had already been briefed on it on 20 May, 17 June, and 24 June?

Rt Hon JOHN KEY: It really does not matter how many times the Leader of the Opposition looks at the press gallery; it will not be any more convincing, because it is not correct. [Interruption]

Mr SPEAKER: Order! Question No. 3.

Science and Research Funding—National Science Challenges Initiative and Other Investment

COLIN KING (National—Kaikōura): What recent announcements has the Government made about investment in the National Science Challenges? [Interruption]

Mr SPEAKER: Order! Can I ask for a little less interjection and barracking from the left-hand side of the House. Would the member please read the question again.

3. COLIN KING (National—Kaikōura) to the Minister of Science and Innovation: What recent announcements has the Government made about investment in the National Science Challenges?

Hon STEVEN JOYCE (Minister of Science and Innovation): Recently I released the request for proposals for the first three National Science Challenges, with $470 million worth of funding available over the next 10 years. The three challenges that will receive funding in the first tranche are: high-value nutrition, up to $180.8 million over 10 years, focusing on foods that develop health benefits and contribute to economic growth; resilience to nature’s challenges, up to $201.4 million over 10 years, strengthening New Zealand’s resilience to natural hazards; and the deep south, up to $88.1 million over 10 years, understanding how the Antarctic and the Southern Ocean affect our climate and the environment. The request for proposals for the first three challenges will close in December. Proposals will be assessed by an independent assessment panel, and decisions on challenge proposals and funding allocation will be made by the Government’s science board. A request for proposals for the remaining seven challenges will be issued in February next year.

Colin King: Why is the Government investing in National Science Challenges?

Hon STEVEN JOYCE: The National Science Challenges are designed to take a more strategic approach to our science investment, by targeting a series of medium and longer-term goals that, if they are achieved, would have a major and enduring benefit for our country. The challenges provide an opportunity to align and focus New Zealand’s research on large and complex issues, by drawing scientists together from different institutions and across disciplines to achieve a common goal through collaboration. New Zealand has a complex and reasonably fragmented science system. Aligning and focusing research in this way will help the Government get better value from our investment in science and research.

Colin King: What investment is the Government making in research, science, and innovation?

Hon STEVEN JOYCE: A very good question. I know the Opposition never tires of hearing the answer. Research, science, and innovation are key drivers of economic growth. They make New Zealand businesses more competitive. We have increased total funding for science, innovation, and research across Government to $1.36 billion in the current financial year, up from $1 billion 4 years ago. In Budget 2013 we allocated an additional $75 million over 4 years for business research and development grants, and $31 million over 4 years for repayable grants for start-up businesses. We have co-invested $684 million in the Primary Growth Partnership to co-fund 16 programmes with industry, and we have established Callaghan Innovation, to get our best scientific ideas out of the lab and into the market place sooner.

Dr Megan Woods: How many of the 10 selected National Science Challenges explicitly seek to stimulate an innovative, high-value manufacturing sector through investment in research in the physical sciences and engineering?

Hon STEVEN JOYCE: There is one specific science challenge in the areas of technological innovation. Fortunately for the member, there is a whole organisation called Callaghan Innovation—which she may have slept through being set up by the Government—which, separate to the National Science Challenges, is specifically devoted to developing research and development opportunities for New Zealand businesses. I believe it will be one of this Government’s proudest achievements.

Ministers—Confidence in Regulatory Reform and Conservation Ministers

4. METIRIA TUREI (Co-Leader—Green) to the Prime Minister: Does he have confidence in all his Ministers?

Rt Hon JOHN KEY (Prime Minister): Yes.

Metiria Turei: Would it not be wiser for him to reserve his decision regarding confidence in John Banks until after the courts have decided whether he has committed criminal fraud?

Rt Hon JOHN KEY: I do not have the luxury of doing that. The member asked me the question now.

Metiria Turei: Does the fact that Skycity’s Chief Executive Officer, Nigel Morrison, was a witness in John Banks’ preliminary hearing and is likely to give evidence if there is a future criminal trial affect his confidence in John Banks’ ability to make an objective decision about the New Zealand International Convention Centre Bill?

Hon Judith Collins: It’s outrageous. This is before the courts.

Rt Hon JOHN KEY: I will kindly follow the member’s advice. The matter is before the courts and I will not be discussing it.

Metiria Turei: Has the Prime Minister been advised in writing by John Banks that he has a potential conflict of interest in relation to the New Zealand International Convention Centre Bill?

Rt Hon JOHN KEY: I cannot recall getting a record of that, but I would need to check my files.

Metiria Turei: Will the Prime Minister require John Banks to formally advise him that a conflict exists, as the Cabinet Manual requires, given that the Skycity chief executive officer could be required to give evidence in court about John Banks and that the New Zealand International Convention Centre Bill relies on John Banks’ single vote to pass?

Rt Hon JOHN KEY: Look, the matter is before the courts and I do not intend to make any hypothetical assessment of it.

Metiria Turei: How can he consider that John Banks does not face a conflict of interest when the chief executive officer of Skycity needs Mr Banks’ single vote to ensure that the casino secures a massive increase in business, and that same Skycity chief executive officer is in court giving evidence that could sink John Banks’ political career?

Rt Hon JOHN KEY: I do not accept the proposition from the member.

Metiria Turei: I seek leave to table a document produced for me by the Parliamentary Library identifying two members of Parliament who have abstained from voting because of conflicts of interest—

Mr SPEAKER: Order! If it is the voting record of this Parliament, then it is freely available to members.

Hon David Cunliffe: Does the Prime Minister have confidence in the Minister of Conservation, given his statement: “I expect high standards from my Ministers … if they don’t meet the standards I set then I will obviously take action if necessary”; and if it is proven that the Hon Nick Smith’s statements around the dates he was first briefed on the Ruataniwha dam issue and the submission from the Department of Conservation are incompatible with the truth, as evidenced by the Minister’s own weekly reports, will he ask the Minister to resign?

Rt Hon JOHN KEY: In answer to the first part of the question, I have confidence in the Minister.

Hon David Cunliffe: Given his refusal to express confidence in his Minister, is it within the high standards he expects of Minister Nick Smith to ensure that the Minister has bent over backwards to get his department not to stand in the way of special interests making massive windfall gains from this partially publicly funded project?

Rt Hon JOHN KEY: My assessment of the Leader of the Opposition’s portrayal of this event is very much like that of his regional statistics. He is making it up.

Metiria Turei: Is the Prime Minister seriously telling this House that he is genuinely unconcerned about allowing one of his Ministers, who is dependent on the Skycity chief executive officer, who could make or break that Minister’s political career, to have the deciding vote on a deal that is worth more than $400 million to the Skycity Casino? Is it really of no concern to you?

Rt Hon JOHN KEY: I do not accept the proposition from the member about the Skycity convention centre, which, I understand, these days the Labour Party is now supporting quietly.

Mr SPEAKER: Question No. 5, Brendan Horan. [Interruption] Order! The level of noise coming from this particular corner is getting to the stage when I will have no choice but to pick one of the noisiest and ask that person to leave.

Grant Robertson: I raise a point of order, Mr Speaker. I might be able to help explain some of the noisiness, because the Prime Minister is just making things up in his answers—

Mr SPEAKER: Order! That is not a point of order, and the member will be very lucky to see the balance of question time.

Hon David Cunliffe: I raise a point of order, Mr Speaker. Can you explain how the Prime Minister has responsibility for the Labour Party’s policies; if not, why was that comment—

Mr SPEAKER: Order! That is not a point of order. If the members continue to raise invalid points of order, if they continue to do that, I will be asking them to leave.

Grant Robertson: I raise a point of order, Mr Speaker. I raise a point of order under Standing Order 383(2) about the Prime Minister’s last answer, where he included a matter that he is not responsible for, which was entirely incorrect and not relevant to the question.

Mr SPEAKER: I invite the member to go back and look at the question that was asked. It was a question with opinion.

Hon David Cunliffe: Speaking to the point of order, Mr Speaker.

Mr SPEAKER: No. If it is a fresh point of order, I will hear it, but if the member is now questioning my point of order, then I will be asking the member to leave. So if it is a fresh point of order, I will hear it, but I want to be quite clear—

Hon David Cunliffe: I raise a point of order, Mr Speaker. This is a fresh point of order. I seek your guidance as to the difference between a ruling that says that a point of order is not a point of order, and a ruling that says that a point of order on a matter like, for example, Standing Order 383 is a point of order but one that you do not find meets your threshold. What is the difference?

Mr SPEAKER: The member is now questioning my ruling. I invited Grant Robertson and I invite the member to have a look at Hansard. When a question is asked, it should equally be short and concise. But when it is asked and it includes quite a lot of additional prose, it will likely get a political answer back.

Grant Robertson: Point of order, Mr Speaker—

Mr SPEAKER: Is this a fresh point of order?

Grant Robertson: Yes it is, Mr Speaker.

Mr SPEAKER: Does it in any way question my earlier rulings with—

Grant Robertson: Mr Speaker—

Mr SPEAKER: Order! Would the member resume his seat. If the member wants to raise a fresh point of order, I will hear it, but if it in any way questions a decision I have just made in the last 5 minutes, then the member will be leaving the Chamber.

Grant Robertson: I raise a point of order, Mr Speaker. I raise a point of order under Standing Order 383(2) and make clear that the answer the Prime Minister was giving was to a question from Metiria Turei. It was not a question from this side of the House. The Prime Minister then introduced material that was irrelevant, and under Standing Order 383(2) he was out of order and you should have ruled him out of order.

Mr SPEAKER: Order! I accept the point that the supplementary question was from Metiria Turei. I equally now invite both the Hon David Cunliffe and Grant Robertson to study that question. It was a very loaded question when it was asked and it got a political answer back.

Hon David Cunliffe: Point of order, Mr Speaker—

Mr SPEAKER: Can I just clarify again. I just—[Interruption] Order! This is a point of order, but I just want to give Mr Cunliffe exactly the same warning that I gave Mr Robertson. If it is a fresh point of order, I will hear it. If it is in any way attempting to question or to relitigate what I have just determined, then the member will be leaving the Chamber for the balance of question time. Fresh point of order—

Hon David Cunliffe: Clarifying the point, Mr Speaker—

Mr SPEAKER: No, I am not accepting clarification of a point. I have ruled.

Hon David Cunliffe: Then I decline to raise the point of order, Mr Speaker.

Mr SPEAKER: The member can certainly raise a point of order, but it must be a fresh point of order.

Energy and Resources, Minister—Statements

5. BRENDAN HORAN (Independent) to the Minister of Energy and Resources: Does he stand by all of his recent statements?

Hon SIMON BRIDGES (Minister of Energy and Resources): Yes.

Brendan Horan: After saying on Campbell Live that there were eight deep-water wells in New Zealand, is the Minister concerned that he may have misled New Zealanders over safety concerns, when the deepest operating well is only 125 metres deep, virtually a puddle compared with the 2 to 3 kilometre depths proposed off the South Island?

Hon SIMON BRIDGES: No, that is not correct. There have been eight deep offshore wells drilled in New Zealand’s history, as I said on Campbell Live.

Brendan Horan: Is the Minister concerned that there have been 2,590 earthquakes recorded by Geonet along the east coast of the South Island since 2008; and will the Minister take personal command of one of the three 8-metre oil recovery dinghies when the inevitable disaster occurs?

Hon SIMON BRIDGES: With the greatest respect to the member, linking earthquakes to any of these sorts of things has no basis in science.

David Shearer: Does he think that the people of Hawke’s Bay and the Wairarapa, whose power prices have risen by $108, will agree with his statement that “we have a system that delivers what New Zealanders want … at a competitive price.”?

Hon SIMON BRIDGES: Yes.

Judicial Proceedings—Trans-Tasman Dispute Resolution

6. PAUL FOSTER-BELL (National) to the Minister of Justice: What recent steps have been taken by the Government to make it easier to resolve cross-border disputes between New Zealand and Australia?

Hon JUDITH COLLINS (Minister of Justice): Last week the Attorney-General of Australia and I launched new trans-Tasman proceedings arrangements between New Zealand and Australia aimed at making a court case between parties located on different sides of the Tasman more like a court case between people in the same country. The new laws will give businesses and individuals greater confidence when operating across the Tasman. It will be easier to start proceedings against a party in the other country, require people to give evidence, and enforce court decisions in the other country. This is another important step in developing closer economic relations between New Zealand and Australia.

Paul Foster-Bell: How will these arrangements make it easier for conducting trans-Tasman dealings?

Hon JUDITH COLLINS: We have one of the most open economic, social, and trade relationships in the world. Last year total trade between our countries was $25.5 billion. Increasing internet use, ease of access to Australian markets, and the speed of doing business today mean we need to have confidence that our legal systems will support trans-Tasman relationships and business contracts. From 11 October this year people have been able to ask for their cases to be heard in their own countries. They will be able to appear before a court in the other country by video or audio link, and they will be able to manage or suspend enforcement of a wide range of civil court judgments from the other country.

Health Services—Funding and Delivery

7. Hon ANNETTE KING (Labour—Rongotai) to the Minister of Health: What reports has he received in the last month of New Zealanders receiving inadequate health services?

Hon TONY RYALL (Minister of Health): As the member will be well aware, I receive more than 100 ministry reports a month, many of which outline the real progress that the Government is making in delivering better health services, but also a few that indicate that some health services do need to be improved. One report I have received outlined unacceptable waiting lists, which led to a decision to send 30,000 patients to be culled off the hospital waiting lists under the previous Government. But now 40,000 more patients a year are getting elective surgery.

Hon Annette King: Is he aware of a report in the last month in the Dominion Post headed “Flood of rest home complaints”, which includes cases of frail older New Zealanders suffering from bullying, surgery delays, malnutrition, poor medication management, and bone fractures, with staffing issues being raised as an ongoing problem; if so, how does this satisfy his 2008 expectations 5 years on that “It is vitally important to maintain public confidence in the standard of care being provided in the country’s rest homes.”?

Hon TONY RYALL: The Government certainly acts very quickly on any concerns that are expressed about the standard of care of our older people in rest home facilities. What I can advise Parliament is that we continue to invest very strongly in aged residential care. We are spending more money than ever before, with a particular focus on dementia.

Hon Annette King: Did he read the report in the past month in the Taranaki Daily News headed “New prescription fees a bitter pill for some patients”, in which Taranaki pharmacists have stated that some patients are finding it difficult to pay the increased fee and that it was a struggle for people with multiple scripts, with larger families, and on lower incomes; if so, how many of these people were surveyed by the Ministry of Health in a survey that he claimed showed that more people were picking up prescriptions than last year?

Hon TONY RYALL: The Ministry of Health’s annual report will be released tomorrow, which actually will debunk the member’s attempts to bluster up a problem.

Hon Annette King: I raise a point of order, Mr Speaker. I asked a question—

Mr SPEAKER: Order! No, the member asked two questions—

Hon Annette King: But that didn’t start to address either of them.

Mr SPEAKER: I am waiting to hear the answer to either of the questions asked.

Hon TONY RYALL: The ministry’s survey to be released tomorrow shows that the proportion of people reporting that cost had prevented them collecting a prescription in the last 12 months has declined for adults and children between 2011-12 and 2012-13. It shows, for example, that the number of adults reporting costs related to prescription for not picking it up reduced from seven to six for adults, and seven to four for children. The Government is investing more in medicines, and, in fact, the total number of funded prescriptions has continued to increase.

Hon Annette King: Has he seen the report in the Otago Daily Times just 8 days ago headed “Financial pressure blamed”, which states that the Southern District Health Board is under so much financial pressure that it is affecting its ability to buy equipment, it cannot replace equipment in the normal time frames, and that replacements can be made only if an item actually breaks; and how will the cost-saving plan that he has imposed on this board ensure that patients receive adequate health services?

Hon TONY RYALL: The Government’s plan with funding to the Southern District Health Board saw it get an extra $17 million last year from our Government. The budget is now a record $818 million at the Southern District Health Board, which continues to provide more operations faster than when that member was the failed Minister of Health.

Hon Annette King: Oh dear, oh dear, oh dear! What a silly Minister. Did he read the report in the Dominion Post in the last month headed “Low-cost clinics at crisis point as funding dries up”; if so, why did he give false hope and false information to such clinics with his announcement that they had received an 85 percent increase in funding, which he called “Our significant increase”, when, in fact, under his four Budgets they have received a 9 percent increase in total, and his latest announcement for the 2013-14 year equates to just $5.60 per patient per year for the sickest, poorest patients in New Zealand and will not make a difference to these clinics?

Hon TONY RYALL: This Government is putting $16 million extra into supporting low-cost practices. But I have also seen a number of reports with headlines that that member might be interested in: “Surgery delays taking heavy toll”, “Surgery delay hits cancer clinic”, “Surgery delay for elderly”, “Waiting time doubles for heart surgery”—

Grant Robertson: I raise a point of order, Mr Speaker. Almost all of that answer from the Minister was about matters for which he is not responsible, and none of it was answering the question that he was asked.

Mr SPEAKER: Order! If members want a concise answer, it is important they ask a concise question. [Interruption] Order! The Hon Clayton Cosgrove will stand, withdraw, and apologise for that interjection.

Hon Clayton Cosgrove: I withdraw and apologise.

Mr SPEAKER: Now the member will leave the Chamber for the balance of question time. [Interruption] He will leave the Chamber.

Hon Clayton Cosgrove withdrew from the Chamber.

Housing, Affordable—Auckland Special Housing Areas and Other Initiatives

8. ALFRED NGARO (National) to the Minister of Housing: What progress has the Government made in addressing Auckland’s housing supply issues over the past two weeks?

Hon Dr NICK SMITH (Minister of Housing): On Thursday, 3 October we formally signed the Auckland Housing Accord with the unanimous support of the Auckland Council. We also announced the first 11 special housing areas in Auckland last week, made possible by the Housing Accords and Special Housing Areas Act, which was passed in the last session of Parliament but opposed by members opposite. It will enable the first tranche of 6,000 new sections in Auckland, which is crucial, given the supply of sections has dropped from 4,500 to just 1,700 over the past decade.

Alfred Ngaro: How long has the land at Weymouth sat vacant, and how has this Government’s programme helped bring the very positively received community development for housing over 1,000 people to fruition?

Hon Dr NICK SMITH: Despite house prices doubling and there being acute shortages and overcrowding issues in South Auckland, these 16 hectares of public land sat vacant all of last decade. Four actions by this Government have enabled this exciting development to proceed. The first is the Ngā Mana Whenua o Tāmaki-makau-rau Treaty settlement, led by my colleague the Hon Chris Finlayson. The second is the housing accords and special areas legislation, which enables the subdivision to be fast tracked, and the first homes to be completed mid - next year. The third is the Social Housing Reform (Housing Restructuring and Tenancy Matters Amendment) Bill, which opens up the income-related rent subsidy to other social housing providers, and so has encouraged them to invest tens of millions of dollars in these houses. The fourth, and final, is the Government’s own Social Housing Fund, which is directly investing $29 million into this Weymouth project.

Denis O’Rourke: Will the Minister give an assurance that the special housing areas proposed for Auckland will produce no fewer than 39,000 sections in the next 3 years; if so, how will he ensure this?

Hon Dr NICK SMITH: Yes, the accord does provide for 39,000 houses over the next 3 years—9,000 in year 1, 13,000 in year 2, and 17,000 in year 3. We have a special officials’ group between the council and the Government, and it is required to report monthly to the governance group, which includes me and Paula Bennett, as my Associate Minister—

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. The Minister was asked a question on how many sections would be provided—not houses. Anybody could tell you that you could put six houses one on top of the other if you liked. He was asked a question about sections, and he should be asked to answer it.

Hon Dr NICK SMITH: The question from the member was how I would ensure that that number of houses would be built, and I have set out the process by which that will be monitored.

Mr SPEAKER: Order! There were certainly two questions. The second part was how would he ensure—I am at a loss to understand the point the member is making. If they are going to ensure that 39,000 houses are going to be provided, that will require 39,000 sections for the houses to go on, will it not? To clarify the matter, if I have misunderstood the original question from Denis O’Rourke, I invite him to ask the question again.

Denis O’Rourke: Will the Minister give an assurance that the special housing areas proposed for Auckland will produce no fewer than 39,000 sections in the next 3 years; if so, how will he ensure this?

Hon Dr NICK SMITH: The accord sets a target, as I have said, of 39,000 houses with the Auckland Council over the next 3 years. The way in which that will be monitored is by the joint officials’ group that has been established between the Government and the council.

Denis O’Rourke: I raise a point of order, Mr Speaker. Could I ask that the Minister make an attempt to—

Mr SPEAKER: No, no. Order! The Minister has now had the question twice. He has answered it. He has answered, I think, the second part particularly, rather than the first part. The member asked two parts to the question, and he certainly got an answer that addressed the question. If it is not to his satisfaction, I can do no more.

Alfred Ngaro: What other Government housing initiatives took effect over the adjournment that will also help address the challenges in housing?

Hon Dr NICK SMITH: On 1 October the Government’s changes to the KiwiSaver first-home deposit subsidy scheme took effect. These increase the housing price cap in Christchurch by $100,000, from $300,000 to $400,000; in Auckland by $85,000 up to $485,000; and in many other areas by $50,000. They also increase the income cap from $100,000 to $120,000. These combined changes will enable a further 25,000 families to pull together a bigger deposit for their first homes over the next 4 years. The other change on 1 October was a trebling in the number of Welcome Home Loans. These are particularly significant because they are exempt from the loan-to-value ratio limits from the Reserve Bank, and they will see an additional 6,000 families helped into their first homes.

Phil Twyford: Does he agree with the comments of the Deputy Governor of the Reserve Bank, who said yesterday that the “relatively slow response of housing supply” is one of the reasons for loan-to-value ratios; if so, why has it taken 5 long years for the Government to announce its first building programme in Auckland?

Hon Dr NICK SMITH: The Government has had a very active programme over the last 5 years, in which there has been good, solid progress. The question I have got for the member—[Interruption] House prices doubled in 9 years, and Labour did absolutely zip.

Hon Craig Foss: I raise a point of order, Mr Speaker. I am finding it very difficult to hear many of the answers. I am not far away but the barracking and bellowing from the other side is making it impossible to hear the answers. [Interruption]

Mr SPEAKER: Order! Every member has the right during question time to hear the question and the answer. The level of noise was relatively loud from this side.

Denis O’Rourke: Why has the Minister told developers that they need devote only 10 percent of developments to affordable homes when prices are already well out of the reach of most first-home buyers?

Hon Dr NICK SMITH: A developer is hardly going to build a house that he cannot sell. They are in the business of building things that they can sell. I think a better way to describe it is the number of houses that are going to be built through the accord and the special housing areas that are low cost. In one of the special housing areas, the Weymouth subdivision, there is going to be 100 percent low-cost houses for families. I can assure the member that many of the other special housing areas, as they come to the qualifying development stage, will also have requirements for building lower-cost houses.

Denis O’Rourke: Given that the costs of consents and development contributions average only 4 percent of the cost of a new home, according to Local Government New Zealand, by what means will the Minister ensure that a minimum proportion of new sections will be affordable, when all he has said about this so far is: “Alongside freeing up land supply, we need to constrain the impact of development contributions on section prices, get better value for building materials, make [efficiencies] in building consents, and improve productivity in the [building] industry.”?

Hon Dr NICK SMITH: The research shows that the biggest increase in house prices has been in the section price, and the reason section prices have become so expensive is that their supply has been very deliberately limited through the Resource Management Act with tools like the metropolitan urban limit. If the member wants lower-priced sections, he should support my colleague the Minister for the Environment and her Resource Management Act reforms, and the member would have voted for our special housing areas legislation, which frees up the land and gets lower-priced sections.

Denis O’Rourke: Will the special housing areas so far proposed have a requirement for smaller sections designed for modest-sized family homes, as a means of reducing total capital cost; if not, why not?

Hon Dr NICK SMITH: Under the accord that we have with the Auckland Council, the primary rules in those special housing areas about the section sizes will be determined by the council. The council has made plain that its desire is to move to smaller sections where they can be well designed. But I point out to the member that the only way we can bring those extra special housing areas and the smaller size sections into place is because of that special housing areas legislation, which that member vigorously opposed.

Education, Minister—Responsibilities

9. 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): Fakalofa lahi atu, Mr Speaker. Yes, particularly as I have today announced that over $400 million is to be invested in secondary schools in the greater Christchurch area.

Chris Hipkins: Did she instruct the Ministry of Education to provide all schools being proposed for closure or merger in Christchurch with all relevant information so that they could have informed input into the consultation process required under the Education Act 1989; if not, why not?

Hon HEKIA PARATA: The recent judgment on Phillipstown School focuses on the specific sections of the Education Act relating to consultation. 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. However, all consultation information provided to schools can be found on the Ministry of Education website.

Chris Hipkins: Is she giving consideration to appealing the High Court’s ruling, overturning her decision to merge Phillipstown School and Woolston School; if so, on what basis?

Hon HEKIA PARATA: The recent judgment on Phillipstown School focuses on the sections of the Education Act relating to consultation. As this judgment is still within the appeal period, and I and one or other of the parties may appeal, I will continue to consider my options and take advice. It would not be in the public interest for me to comment.

Chris Hipkins: Did the High Court rule in favour of Phillipstown School’s request for the merger decision to be overturned; if so, does she expect the school to appeal the decision that it won, or is she just using her own indecision about whether or not to appeal the case as an excuse to avoid answering questions on yet another botch-up that she has made as a Minister?

Hon HEKIA PARATA: There is no indecision. As a responsible Minister, I am considering options, taking advice, and not commenting at this time in case one or other of the parties appeal during this period. It would not be in the public interest for me to comment.

Chris Hipkins: Did the courts earlier rule that her decision to close Salisbury School in Nelson lacked common sense and amounted to “an abrogation of the responsibilities involved in making a decision”; if so, how many more times do her decisions need to be overruled in court before she will actually start to genuinely listen to the feedback that communities are giving her?

Hon HEKIA PARATA: I cannot comment on the specifics of the first judgment, because I do not have it in front of me. In terms of listening, I can point the member to the consultation information provided on the Ministry of Education website, and the member will be able then to review all of it.

Regional Population Growth—2013 Census Data

10. JACQUI DEAN (National—Waitaki) to the Minister of Statistics: What does the latest release of Census data show in regard to population growth in the regions?

Hon MAURICE WILLIAMSON (Minister of Statistics): The information released this week from Statistics New Zealand shows that all but one region grew in size of population since the last census in 2006. This shows that the Government is delivering on its priority to develop a stronger economy. The data released is a far cry from the Hon David Cunliffe’s inept prediction—

Chris Hipkins: I raise a point of order, Mr Speaker. I would like to draw your attention to the Speakers’ Rulings supplement, page 8, Speaker’s ruling 154/2A, made by the Hon Dr Lockwood Smith on 13 November last year, in which he ruled that “It is not reasonable to use questions from the governing party or its support parties to attack other members of the House.”, which is exactly what this question is designed to do. A Minister cannot use a patsy question from—

Mr SPEAKER: Order! [Interruption] Order! The member will resume his seat. I accept the bulk of the point of order being made. The answer was satisfactory until the Minister attempted to revert back to something that was under a previous administration, which was not his responsibility.

Hon MAURICE WILLIAMSON: I was actually referring to a statement from the Leader of the Opposition from last week.

Mr SPEAKER: That is not helpful, as I have just ruled.

Jacqui Dean: Which regions in particular have grown the most?

Hon MAURICE WILLIAMSON: The Auckland and Nelson regions both grew by more than 8 percent, followed by the Waikato with 6 percent. That was nearly 23,000 people, so it is huge. Waikato was, in fact, again one of the areas highlighted by Mr Cunliffe’s press release where he said that Taranaki was not growing.

Chris Hipkins: I raise a point of order, Mr Speaker. In his answer, the Minister has now directly challenged the ruling you had just made. A moment ago you asked my colleague Clayton Cosgrove to withdraw and apologise, and then threw him out of the Chamber without giving a reason. The Minister has directly challenged—

Mr SPEAKER: Order! The member will resume his seat, otherwise he will be accompanying Mr Cosgrove shortly. I think the Minister made a fair point, though. He was not referring to a previous administration; he was actually referring to a relatively recent statement by an Opposition member. I was possibly a bit hard on him the first time, but I think the question has now been adequately answered.

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

Mr SPEAKER: Is this a fresh point of order?

Chris Hipkins: It is indeed a fresh point of order. Perhaps if I could go back to the Speaker’s ruling that I first referred to.

Mr SPEAKER: Can I just check that this is a fresh point of order.

Chris Hipkins: Absolutely. It is Speaker’s ruling 154/2A. I appreciate that you might not have it in front of you so you might not have acknowledged it. What it says is: “It is not reasonable to use questions from the governing party or its support parties to attack other members of the House.” There is a further Speaker’s ruling immediately after that, which says: “Ministers should not bring another political party, which has not been involved in the questioning, into an answer.” In this case, this is a Government question to a Government Minister. The Labour Party has had no role in this question. It does not matter whether it was an action of the previous Government or a statement that David Cunliffe has made recently. The Minister has no responsibility for it. We are not a party to this question.

Mr SPEAKER: I have accepted the point the member has made, and the question is now concluded. This is a debating chamber. Consider the questions that are being asked today right across the Chamber. Many of them are very loaded questions. If you want a sterile environment with short, sharp, crisp questions with no opinion at all and answers accordingly, I can work to deliver that, but I do not think it would be in the interests of this Parliament. It certainly would not be in the interests of New Zealand democracy.

Chris Hipkins: I raise a point of order, Mr Speaker. This is the last point of order that I will raise on the matter. I absolutely accept that where members of the Opposition ask questions that are political in nature, the Government has the right to attack back in a political fashion. The issue at question here is that this is not a question that the Opposition is in any way a party to.

Mr SPEAKER: Order! The member is now just repeating the point of order he has already made, and I have ruled on it.

Chris Hipkins: So are you ruling that these are now out of order?

Mr SPEAKER: Order! [Interruption] Order! Does Chris Hipkins also want to take an early shower? Well, then, I suggest that he stops interjecting.

Freshwater Management—Department of Conservation Submissions on Water Quality

11. EUGENIE SAGE (Green) to the Minister of Conservation: How many submissions did the Department of Conservation make on regional, district or city plans or regional policy statements in 2012/13 that related to water-quality issues?

Hon Dr NICK SMITH (Minister of Conservation): The department’s interests in water quality are mainly where it relates to freshwater fisheries, as the Ministry for the Environment is the lead agency on these issues. In that year, 24 Resource Management Act submissions were made on plans and policy statements, and most, if not all, had something in them that might relate to water quality.

Eugenie Sage: Why was it appropriate for the department to make 24 plan submissions, including at least nine on water-quality issues, but then not make a submission on proposed plan change 6 for the Tukituki catchment, which will enable New Zealand’s largest proposed new dam and irrigation scheme?

Hon Dr NICK SMITH: The decision about the submission, as Doris Johnston has said, was made by her. When I inquired into the department as to why it made the decision not to submit, the reason was that when the Department of Conservation managers met with the Hawke’s Bay Regional Council and the National Institute of Water and Atmospheric Research (NIWA) and the Cawthron Institute scientists, they concluded that their science was robust and that it would have been a huge amount of resource to contest what NIWA had concluded about the water-quality issues in plan change 6.

Eugenie Sage: Why did the department say in its submission on Southland’s proposed regional plan change 13 on dairy farming: “Inappropriately sited or poorly managed land use, including dairy farms either by themselves or in combination with other activities have the potential to significantly adversely affect water quality …”, but yet decide not to submit on water-quality issues on plan change 6 for the Tukituki catchment?

Hon Dr NICK SMITH: I think the point that the member makes on the department’s submission on Southland is that it followed exactly the same process as in respect of Tukituki—that is, the decision was made by the department. In some cases it contests the science that is in a plan and sometimes it accepts it. In the case of Tukituki the department concluded, as is on the public record, that the science from NIWA was robust in respect of plan change 6.

Eugenie Sage: Is it the reality that there will be fewer or no departmental—

Hon Dr NICK SMITH: I seek leave of the House to table the report where the Department of Conservation says that NIWA’s science on plan change 6 was robust, because the member Ruth Dyson—

Mr SPEAKER: Order! Is that information already freely available to members to seek?

Hon Dr NICK SMITH: Yes, it is.

Eugenie Sage: Is it the reality that there will be fewer or no departmental submissions on water quality in future on his watch because he does not want the Department of Conservation highlighting the water pollution problems with his Government’s irrigation agenda?

Hon Dr NICK SMITH: Of course not. I point out to the member that the Resource Management Act is 20 years old, and it was not until I was the Minister for the Environment that we actually got a national policy statement delivered on water quality. Labour, when in Government with the Greens, did absolutely nothing in terms of putting rules in place around water quality.

Eugenie Sage: The Minister talked a lot about—

Mr SPEAKER: Order! Is this a point of order?

Eugenie Sage: I raise a point of order, Mr Speaker. The Minister talked a lot about what he had done as Minister for the Environment but did not answer in terms of his ministerial responsibilities.

Mr SPEAKER: Order! The Minister has addressed the question. It may not be to the member’s satisfaction, but the Minister has addressed the question.

Broadband, Ultra-Fast-Infrastructure Pricing and Contract with Chorus

12. Hon DAVID CUNLIFFE (Leader of the Opposition) to the Prime Minister: Does he now accept that his statement that Chorus “will go broke” is incorrect; if not, why not?

Rt Hon JOHN KEY (Prime Minister): I stand by my full statement, which is: “Basically, if the Commerce Commission ruling stands there’s a chance Chorus will go broke.” I do not accept that this statement is incorrect.

Hon David Cunliffe: In light of the Prime Minister’s comments that “It’s not a view that’s come off the top of my head.”, that he received a phone call from the chair of Chorus New Zealand that probably informed him of the matter, and that officials briefed him with “commercial-in-confidence” information, upon what information has he based his view that it “could go broke”?

Rt Hon JOHN KEY: It is based on both the public statement made by Chorus and the “in-confidence” advice received by Cabinet, which aligns with the public statement made by Chorus.

Hon David Cunliffe: Given that the Australian and New Zealand stock exchanges have said that there is no reason to be concerned that Chorus New Zealand Ltd has breached its continuous disclosure requirements, and that the market must therefore have been fully informed, what information has he based his statement on that is not otherwise available to the market?

Rt Hon JOHN KEY: Firstly, I think that the member himself misrepresents what the NZX actually says. Secondly, I based it on the information that was received in confidence, which aligns with the public statement made. If you go back to the statement I made, I said “if the Commerce Commission ruling stands there’s a chance …”, and the Commerce Commission ruling has not stood yet; it is a draft determination.

Rt Hon Winston Peters: Will the Prime Minister consult with the Minister for Small Business and the Associate Minister of Commerce on the financial health of Chorus, or is that irrelevant now that he has been sent to trial for fraud?

Rt Hon JOHN KEY: Nice try—no.

Hon David Cunliffe: How can he, as Prime Minister, have made statements about Chorus New Zealand Ltd based on “commercial-in-confidence” information not generally available to the market, without breaching the Securities Markets Act?

Rt Hon JOHN KEY: Because they are in line with the public statements made by Chorus. If anyone knows about breaching those, I think it is Mr—

Mr SPEAKER: Order! That answer is sufficient.

Hon David Cunliffe: Which of the following three options is true: either, a, Chorus New Zealand Ltd misled the Prime Minister; or, b, Chorus New Zealand Ltd failed to disclose the same information to the market provided to his Government; or, c, he has displayed “ineptitude and commercial naivety by his ham-fisted comments” about Chorus New Zealand’s financial liability?

Rt Hon JOHN KEY: I am going with “d”—that my caucus sings in chorus with me, unlike his caucus.

Hon David Cunliffe: Supplementary question—[Interruption]

Mr SPEAKER: Order! Order! Your own colleagues are not supporting you today with the level of interjection.

Hon David Cunliffe: Does the Prime Minister accept that he is dancing on the head of a pin to justify one of the largest handouts of corporate welfare in New Zealand history, violating a statutory process, at a cost of around $150 a year to every Kiwi family?

Rt Hon JOHN KEY: No.

Urgent Debates Declined

Te Kōhanga Reo National Trust Board—Audit

Mr SPEAKER: I have received a letter from the Hon Shane Jones seeking to debate under Standing Order 386 the decision by the Minister of Education and the Associate Minister of Education to order an audit into inappropriate spending at Te Kōhanga Reo National Trust Board. The decision to conduct an audit is a particular case of recent occurrence involving the administrative responsibility of the Government. However, not every such decision will occasion an urgent debate. There must be an element of urgency for the matter to take precedence over other business. Although the decision to conduct an audit is an important step in the Ministers assuring themselves that public funding is being used appropriately, the audit will take some time. I am not convinced that the matter warrants the setting aside of the business of the House today. The application is therefore declined.

Points of Order

Questions for Oral Answer—Application for Urgent Question

GRANT ROBERTSON (Labour—Wellington Central): I raise a point of order, Mr Speaker. I have made an application to you to ask an urgent question in relation to whether or not the Prime Minister will stand down John Banks now that the District Court has decided that he will stand trial for knowingly filing a false electoral return. I believe that this is a matter that should warrant an urgent question. Mr Banks is about to stand trial, and under Speaker’s ruling 183/2—

Mr SPEAKER: Order! I have heard enough from the member. Urgent questions must relate to something that must be dealt with immediately and could not wait until question time tomorrow. To my mind, that could wait, and I refer the member to Speaker’s ruling 182/5.

GRANT ROBERTSON (Labour—Wellington Central): I raise a point of order, Mr Speaker. I believe that this is a matter of—

Mr SPEAKER: Order! I have ruled on the matter. The member is now challenging that ruling. That is disorderly. That is the sort of disorder that gives me no choice but to ask the member to leave the Chamber.

GRANT ROBERTSON (Labour—Wellington Central): I seek leave of the House to ask the Prime Minister an urgent question asking whether he will stand down John Banks.

Mr SPEAKER: Leave is sought to ask an urgent question of the Prime Minister. Is there any objection to that course of action? There is.

General Debate

General Debate

Hon BILL ENGLISH (Deputy Prime Minister): I move, That the House take note of miscellaneous business. Last week—

Hon Maryan Street: Crooks and frauds, Mr English.

Hon BILL ENGLISH: Labour Party members talking about electoral fraud—you have got to be joking. Do they not remember writing out their cheques for the pledge card? Do they not remember the $800,000 the taxpayer had to get back from the Labour Party? But now, of course, under the new leader of the Labour Party, the pledge card, like his CV, will be a living document—kind of like the Treaty but without the principles. It will be a CV that changes as time goes on. If you ask yourself the question of where David Cunliffe got his numbers for regional economic growth in New Zealand from, I think he got them from the same place as he got his CV—that is, some little compartment in the back of his mind that has a tremendous power of imagination.

So it was that the Mother Teresa with the MBA from Harvard got it completely wrong on Taranaki. In this last week the International Monetary Fund put out its figures that said that New Zealand would—

Hon Annette King: How nasty.

Hon BILL ENGLISH: Yes, this is nasty for the Labour Party. New Zealand is the fifth fastest-growing economy in the developed world—[Interruption]. Very good. Out of 35. That is a tribute to all of those New Zealanders who have shown so much resilience over the last 5 years in the face of recession and in the face of earthquakes, bad weather, and the headwinds of a high exchange rate. And with the support of the Government they have made this economy grow, delivering more jobs and higher incomes.

Kris Faafoi: That’s with a straight face.

Hon BILL ENGLISH: And the Leader of the Opposition said with a straight face—and I have followed a bit what he has been saying—that, basically, Auckland is struggling, Wellington is stuffed, the provinces have had it, Christchurch is stagnant, and Taranaki is gone. Taranaki is gone because “People are leaving in droves.”

Well, let us look at the headline from today—“Taranaki leaders are hailing new population figures that show the region is booming.” Now we are finding out why the Labour caucus did not vote for David Cunliffe. Those members know what we are finding out, that he just makes it up. How stupid could he be to pick the strongest-growing region in New Zealand, and make that his poster boy for failure—[Interruption]

Mr SPEAKER: Order!

Hon BILL ENGLISH: So this is the logic. Mother Teresa with the MBA from Harvard University—[Interruption]

Mr SPEAKER: Order! If I get another interjection from Annette King, she will be leaving the Chamber as well. I am sorry to interrupt the member.

Hon BILL ENGLISH: The member wishes she had stood for mayor. Why did that member not stand for Mayor of Wellington? Because she would have lost—that is why.

So here is the logic. The Labour Party is running a campaign on regional development—a campaign on regional development. And what it does is take its shiny new leader, and it says: “David, pick the fastest-growing region with the highest per capita GDP in New Zealand, and use that as the example of the failure of the Government’s economic policy.” Incomes in Taranaki went up, as they have in every other region of New Zealand. In the period 2007 to 2010, with the high exchange rate and a worldwide recession, the population in Taranaki went up in every region except Gisborne—in every region except Gisborne. The Government’s policy is working. The economy is growing, and the regions are among our star performers.

Hon CLAYTON COSGROVE (Labour): Freedom of speech—great! Bill English, the Deputy Prime Minister of this country, is a man who is propped up. The only reason he has his job today is because he is propped up by a rotten pile, by a member of Parliament who is already a convicted criminal, who already has a criminal conviction to his name, and who is now about to stand trial for election fraud. That one person is, of course, the Hon John Archibald “Brown Bag Banks”. That is it.

The Deputy Prime Minister is propped up by a rotten pile. That member is a sort of Basil Fawlty of Parliament, with Fawlty Towers being his Government. Under his watch, with the Minister for State Owned Enterprises, he bumbled around like Basil Fawlty, blaming everybody else, stumbling in the dark. He is aided and abetted by Manuel over there, the Minister for State Owned Enterprises, who says: “I no complain. I see nothing. I know nothing.” He let Solid Energy go down the gurgler. He let Solid Energy go down the gurgler.

When it comes to the Bank of Tokyo-Mitsubishi UFJ, he stands accused of mismanagement and of negligence. This is, of course, the man who said he would not let Solid Energy fail. Then weeks and months later, as the negotiations with the banks continued, he undermined his own chairman—he grins away—and did not even tell Mark Ford as he dropped a bundle on him and said: “Well, we may let it tip over.” Those are great negotiating tactics. Then, of course, he announces—in his own slipshod way, bumbling around in the dark—that we have a deal, like a sort of second-rate game show host, saying: “We have a deal. It’s done. It’s zipped up. Everybody’s falling in line.” That was 10 days ago.

But 96 hours after that—96 hours after that, Basil—the Bank of Tokyo drops the ball on him and goes to court. When I was in the private sector, a deal sort of went like this: you got round the table, you got an agreement, you got the ink dry on the document, everybody agreed, and then you announced it to the world—but oh, no, not Bill English. He shot his mouth off, he shot his bolt, and now he is about to get shot by the Bank of Tokyo.

Of course, this is the man who negotiated a fabulous deal with Rio Tinto. It was totally negligent. This is the man who came to this House and said that the $30 million free gift was to secure Southland jobs. That is what he said over and over and over again. On Kathryn Ryan’s show with me he must have said it five times. When the deal is on the rocks, we then find out that there is no guarantee of any of those jobs, not even up to 1 January 2017. Then we asked whether the Minister bothered in the heavy duty negotiations—or Manuel over there—to actually ask for a guarantee. You know, if you do not ask, you do not get. That is the normal sort of modus operandi. He did not have the gumption. He was negligent. He mismanaged it.

This is the guy, of course, who then went over the top of his board in the Meridian Energy deal per se—a $30 million free gift, and he sits there every day, misleading the New Zealand people, saying that he secured the jobs. Not 4 days before that deal was done, before the ink was dry on the cheque, they were sacking maintenance workers at Rio Tinto. He got no guarantee, and he did not have the brains, as he bumbles around in the dark, to ask Rio Tinto—or to beg Rio Tinto—for $30 million, or for 30 million pieces of silver to actually secure those jobs.

Then there is Mighty River Power. Well, what a botch-up. That guy over there and the Minister for State Owned Enterprises will go down as the most useless, feeble, and negligent Ministers and shareholding Ministers of State-owned enterprises. They over-egged the pudding with Mighty River Power. They were greedy. They wanted more money—10 percent down on the price. Then, of course, we had free shares in respect of Meridian, and a set of steak knives thrown in.

All the time they were trying desperately to get the sale of these State-owned enterprises off the ground. That was not because they wanted to maximise the returns to shareholders—they are not the shareholders; the taxpayers are. They have to sell these State-owned enterprises simply because it is the Prime Minister’s political vanity and political pride on the line. If he was still working for Merrill Lynch, the Prime Minister would tell his shareholders not to sell, and that it was not the right time—no time is actually the right time—to maximise shareholders’ returns.

So now it comes down to it. “Brown Bag Banks” is up on fraud charges, propping the Government up. He is propping the Government up. That is what it is down to: the rotten pile from Epsom propping the Deputy Prime Minister up. Well, I hope that over there they are all very proud of themselves.

Hon MAURICE WILLIAMSON (Minister of Statistics): On this incredibly prestigious day, when Eleanor Catton has won the Man Booker Prize, I want to make the theme of my speech one a bit more to do with a literary theme. I want to tie it to the recent announcements about regional numbers, and I want to use a couple of things I was not able to use even at question time. For example, I was giving the House a briefing about how seriously wrong David Cunliffe had got his regional forecasts—seriously wrong. His calculator and his crystal ball must both be broken, because he got them wrong. He put out press releases saying that there was a mass exodus. “Census shows regional exodus under Nats” was the headline of his press release. Another one that came in was “Cunliffe blames Govt for the Taranaki exodus”. But, as I said, in keeping with trying to be literary, I found a poem and I thought the poem would really bring it to the House’s attention. The poem is called “I am census and census is me”:

Regional growth has been so poor,

It is the last one out who should close the door.

The Nats have dealt the regions such a blow,

And now only the big cities are able to grow.

The Waikato and the ’Naki are down but not out.

“It’s Labour to their rescue.” as their leader I did shout.

When the census is released, the truth will be felt,

Just what a blow to the regions has been dealt.

It’s so very sad to see such regional decline.

Places that once sparkled now wither and die on the vine.

The big just get bigger and Australia does beckon.

This is the worst Government ever—what do you all reckon?

Oh no! Gosh! Gee! Bugger! Damn!

The actuals are out and my predictions are a sham.

The regions are actually growing, they’re actually on fire, they’re alive,

And as Labour leader, it’s unlikely I’ll now survive.

That is a poem I found called “I am census and census is me”, and it puts it in a nutshell. It puts it in a nutshell.

How can a party, a once-proud party, have a leader get up and make such statements? They are not mine; these are his statements. “Census shows regional exodus”—that is what the headline of his press statement is, and every region in the country but one has grown. And then to pick Taranaki. I reckon this is my personal favourite—this is my personal favourite: “Taranakians are leaving the province in droves because they’re being forgotten by the National Government, Labour leader David Cunliffe says.” Well, that is interesting, because here I have got a Stuff article from today, 16 October, by Helen Harvey, the headline of which says “Headcount springs a big surprise. Taranaki leaders are hailing new population figures that show the region is booming.”

How does that work? How can you be the Leader of the Opposition with a phenomenally big resource budget and a research unit, which has obviously sat down and done its work, and forecast to the nation what is going to happen—actually, it would put a bit of a frightener on some us; my God, if Taranaki has collapsed like this it is going to be quite serious and quite damning—and then the reality comes out that he got it so wrong. He got it so wrong. Waikato is another good example of where there is phenomenal growth—phenomenal growth.

Under this Government the regions are actually booming, and remember that that is under two enormously big caveats for the nation: a global financial crisis that put the whole country into a state of financial difficulty and a massive earthquake that cost billions, if not tens of billions, to the economy.

So then I got some numbers from the research unit to have a look at things like: “Well, OK, if the population is growing, let us have a look at whether, say, incomes are growing.” Again, we will hear from Mr Cunliffe as Leader of the Opposition, who said that, well, people are so much worse off. Here are just a couple of figures that I think this House should dwell on. After-tax wages in New Zealand since 2008—and those are the ones that matter—have gone up by 22 percent.

Sue Moroney: So people are wealthy?

Hon MAURICE WILLIAMSON: And before the Labour Party calls: “Oh, well, what about all the cost rises?”, that is at the same time as inflation went up by only 9 percent. I know that most people can work that out. A 22 percent increase in after-tax wages while their cost of living CPI is up by only 9 percent—it is a fantastic outcome. The regions should be hellishly proud of themselves, and one day they should stop listening to David Cunliffe, like most of his own caucus has already done.

CATHERINE DELAHUNTY (Green): Tēnā koe, Mr Speaker. Tēnā koutou e te Whare Paremata. I have not got a rhyming couplet series in this speech, but I want to talk about a really true story that is important to this country. While the Prime Minister was heading off to Bali to further strip our country of our sovereignty and its resources by our free-trade deals, three young men entered the Australian consulate and asked for amnesty, for peace, and for the right of journalists to visit the country of West Papua. Australia ignored their pleas, and also dumped seven desperate people from West Papua who were being hunted by the Indonesians into a refugee camp on the border with Papua New Guinea.

But what has New Zealand done lately? What has this Government done lately for this beleaguered country? Well, we have colluded with the powerful against the vulnerable, and we have committed $6.34 million over 3 years to run yet another community policing programme to train the police to play nice in West Papua, based on the supposed great success of the previous pilot. This pilot in 2008-10 was, interestingly, assessed and was supposedly a success in the minds of some of the well-intentioned people who believe in community policing, but if you ask West Papuans about it, what they have experienced from their police in the 2 years since New Zealand did this wonderful training has been nothing short of desperate genocide. There have been police involved in numerous incidents of human rights abuses, shootings, killings, torture, and attacks on communities. These have involved deaths and the vigorous application by the police of treason laws that include arresting people for praying for peace at church services, for holding rallies, and for supporting the Freedom Flotilla from Australia. So thank you very much, New Zealand Government, but this is not helping. Community policing is a very good initiative when the community has got some kind of basic rule of law, but right now we are sending our community police to train in a war zone—a war zone where peace has not been declared.

What about aid? What about addressing poverty? What about human rights? What about HIV programmes and community development? The Green Party is a great supporter of positive aid, but we are very concerned about human rights. We know that human rights in West Papua are abused daily. We know that our Government in this country is now ignoring the New Zealand Bill of Rights Act on family care, for example, and has introduced mass surveillance, thus showing a willingness to adopt more totalitarian methods. However, to spend $6.34 million of very, very precious aid money on something that is not going to work is actually disgraceful.

The training policy that has been introduced is in a contaminated context and it is doomed to fail. It is very interesting to read the review of this pilot that was supposedly the great success. One of the quotes from the review is that “The degree to which the project contributed to improving human rights and enhancing respect for the rule of law is unknown.” The Government does not know. Now it is throwing more money at a problem that we will not take responsibility for in the true sense, and the problem will not be fixed by yet another waste of community policing training.

This is incredibly disappointing. In fact, what it is like is handing out pretty umbrellas to people in the middle of a cyclone. That is what we are doing. The New Zealand Government aid programme in West Papua is handing out the pretty umbrellas in the middle of a series of police and military attacks on citizens, which is a disgrace. So the Green Party is calling for a much more positive response from the Government. We know it loves mass surveillance. It is in with the right people, if that is what it likes, but Indonesia requires something more in terms of response. We need to challenge Indonesia to start a peace dialogue with the people of West Papua to create some safety, some human rights, and some basic legal rights in that country.

If New Zealand wanted to take leadership, that $6.34 million would be better spent on negotiating with the parties to create a peace environment with some independent mediation, which we ought to be capable of, rather than having all these other ridiculous programmes that are not working. We are very disappointed with this waste of money.

Hon TODD McCLAY (Minister of Revenue): The economy is growing, inflation is down, interest rates are at record low levels, and the regions are strong. The regions are strong and they are full of National-voting citizens. You see, the Government has a plan, it is working, and we are sticking with it. The Government is in touch with New Zealanders up and down New Zealand. By comparison, the Labour Opposition is out of touch with all parts of New Zealand, and especially the provinces. You see, one need think back to only the last election to reflect and one would realise that the National Government holds every single provincial seat in this country but two. It holds every single provincial seat in this country but two, and I will come to those two in a moment.

Every day National constituent MPs are out working hard, helping their constituents, listening to New Zealanders, and dealing with the real issues that they face. By comparison, the approach of the Labour Opposition members, who are out of touch, to engagement with the provincial part of New Zealand is the occasional bus tour up and down the country. There have been three fantastic tours in the 5 years we have been in Government. There was the Phil Goff motorbike tour of the country. There was the David Shearer guitar-playing, surfing, hippie tour of the country. And now we have the David Cunliffe “promises that I’m not going to keep” tour of New Zealand.

You see, to become Leader of the Opposition, David Cunliffe made every promise to every person that he had to. He made promises all over the place. Anything someone else proposed, he said he would do too—he promised. He promised everything to everyone all of the time—well, except for Trevor Mallard, of course. He did not promise everything to Trevor. I have got to say, I think that the Leader of the Opposition has got it wrong, because I saw the Hon Trevor Mallard on TV the other night with one of his constituents, dealing with an immigration problem, and I have got to tell you that I have actually changed my mind about Mr Mallard. He is the only person over there whom I have seen who has any evidence that he is actually in touch with local people, and certainly the—

Hon Trevor Mallard: I raise a point of order, Mr Speaker. Although I appreciate the member’s assistance, this is destroying what is left of my reputation. I ask him to cease.

Mr SPEAKER: Order! That is not a valid point of order.

Hon TODD McCLAY: I would apologise but he wrote a wonderful article about me in a newspaper once, so it is only fitting that we do the same for each other. But my point there was that this is the only member of the Opposition whom I have actually seen evidence of being out there talking to constituents.

Let us think about what the new Leader of the Opposition has said. He said that census data will depict a widespread exodus from the regions. And what have we seen? In every region in New Zealand but one the census data shows that the population has gone up. It is more than that. In fact, we look at one of the two areas in the provinces on the West Coast where Labour holds a seat, and the new Leader of the Opposition, David Cunliffe, did not even bother to talk to that MP, Damien O’Connor, because in the area that Damien O’Connor represents on the West Coast there was a growth of population by 2.6 percent. So I guarantee you that Damien O’Connor not only was not asked but also is one in the majority in the party opposite who did not vote for its new leader.

Up and down the country, National MPs are working hard. Let us have a look at this. In Northland, where we hear Shane Jones going on about the doom and gloom—Northland’s MP is the hard-working Mike Sabin—real after-tax income, wages, over the last 6 years went up by 18 percent. The population went up by 2.2 percent. Well, that is not evidence of the great exodus that David Cunliffe said we would see in the census.

Let us come a little bit further south from there to the Waikato, because with the exception of a few seats in Auckland, National has all of the rural and provincial seats in between Northland and the Waikato. It is very clear that in the Waikato—including Louise Upston, the hard-working member of Parliament in Taupō—we had an increase in after-tax wages of 7 percent and in population of 6 percent. In the Bay of Plenty, where we have Simon Bridges, Anne Tolley, Tony Ryall, and the hard-working member of Parliament for Rotorua, we hold every single seat in the Bay of Plenty. Of course, it had a 14 percent increase in income and a 4 percent increase in population. In Taranaki and New Plymouth, where we have Chester Borrows and Jonathan Young, the area we actually heard would be the worst in the country because of everything that is going on there around oil exploration, we had a 14 percent increase in after-tax wages and a 5.3 percent increase in population.

Up and down this country, the provinces have been growing and we are doing well. Why is this? It is because we have National MPs every day out working hard and representing—

GRANT ROBERTSON (Labour—Wellington Central): John Key must stand down John Banks as a Minister. The District Court in Auckland has called Mr Banks to trial for knowingly filing a false electoral return. John Banks has lied to the Prime Minister, he has lied to the people of New Zealand, and he has knowingly filed a false return.

Hon Dr Nick Smith: What happened to a fair trial?

GRANT ROBERTSON: He says: “What about the trial?”. This is what the judge said, Dr Smith. The judge said that John Banks had closed his eyes to the obvious. He had signed an electoral return that he knew was false. Why? In the District Court yesterday, the Chief Executive of Skycity, Nigel Morrison, said—

Hon Dr Nick Smith: I raise a point of order, Mr Speaker. As the member has correctly observed, this matter is now going to trial before the courts. The court has made the decision that this matter is now before the courts. There is a very clear Standing Order that states that members should not comment on matters before the courts, as that is seen to prejudice a fair trial for a member of this House. I think the member needs to be constrained, given that crucial fact.

Mr DEPUTY SPEAKER: I have kind of been internalising—I think that is the word—where this debate might actually be going. The first comment I would make is that a word that refers to the use of terminological inexactitude has yet to be proven, and I think that the member should desist from that. The second point is that I would deem the detail around what the court case might be to be off limits because of the rulings that we have substantially in this place about matters before the courts. So I think that the member should not be referring in detail to the case. I understand that this is a finely balanced argument. I am trying to assist the member in trying to apply the rules of the House.

GRANT ROBERTSON: Speaking to the point of order—

Mr DEPUTY SPEAKER: Well, I—OK, we will extend.

GRANT ROBERTSON: I thank you for your advice on this matter, Mr Deputy Speaker. My understanding of the relevant rulings is that I am at liberty in this House to make comment on matters that are before the courts. However, I do have to show the kind of judgment that I think you have reflected. So I just want to make it clear that I am not prevented from referring to those matters, in my understanding of the Speakers’ rulings.

Mr DEPUTY SPEAKER: That is about where I think I got to. The member should not try to deal with the detail of the case. There is a matter that I think the member is referring to that relates to integrity, but it is actually delving into the detail of the case. So I just caution the member on that part.

Hon Trevor Mallard: But you’re allowed to refer to the judgment.

GRANT ROBERTSON: Yes, and I want to quote from the public statement of the judge. This is what he said: “Mr Banks has closed his eyes to the obvious.” What he is referring to there, in matters that have been dealt with many times in this House before, is that Mr Banks signed an electoral return that he says he did not read. That is the excuse that he has brought up in this House and in the public arena many times over the last year—that he did not read it. Well, that excuse is not available to a small-business owner who is filing a tax return. They cannot get away with it, when the Inland Revenue Department comes knocking, by saying: “Oh, I’m sorry. My tax return was false because I didn’t bother to read it.”, but that is what John Banks did. That is—

Hon Dr Nick Smith: I raise a point of order, Mr Speaker. I want to refer you quite specifically to Speakers’ rulings on matters that are to be adjudicated by the courts. They are very clear, and they say that, pending adjudication in the courts, they must not—

Mr DEPUTY SPEAKER: Can the member just refer me to the precise Speaker’s ruling?

Hon Dr Nick Smith: Yes. I am referring to Speakers’ rulings 30/1, 30/2, 30/3, 30/5, and 30/6, which quite specifically say that if a matter is “pending adjudication in the courts [it] must not be debated in the House,”. What the member is directly proceeding to do is debate just those issues.

Mr DEPUTY SPEAKER: Yes. I think the member has now gone beyond what I ruled when he started quoting the matters that will be before the courts when he reached the judgment and was passing comment on that. I think he went beyond, and I was trying to assist the member. So I would ask the member—in principle, yes, but detail, no.

GRANT ROBERTSON: I raise a point of order, Mr Speaker. I want to clarify with you that the judge in the District Court has issued a ruling today. I must be at liberty to be able to quote from that.

Mr DEPUTY SPEAKER: You can, but you cannot comment on it.

GRANT ROBERTSON: Yes, right. That is right. How long do I have left?

Mr DEPUTY SPEAKER: Just over 3 minutes.

GRANT ROBERTSON: The judge has not only said today that Mr Banks did close his eyes to the obvious but also said that the evidence shows—

Hon Dr Nick Smith: I raise a point of order, Mr Speaker. The decision by the court today is that Mr John Banks will stand trial on these issues—that is all. What we know from the court is that it has said that there is sufficient evidence for this to go to trial. I do not think that the shadow Leader of the House can proceed down the road where he is going relative to the Standing Orders, which are just so clear in this area. If a matter is to come up before the courts, this Parliament should not debate it, because that would prejudice the proper trial that the court must have.

GRANT ROBERTSON: Speaking to the point of order, Dr Smith says that all the judge did was say that the matter should go to trial. That is not correct. The judge made a number of comments today that are in the public arena and that I am entitled to refer to.

Mr DEPUTY SPEAKER: Yes. I am taking my advice from Speaker’s ruling 30/3, which is why I have ruled that the member can quote, but not comment on. If you look at Speaker’s ruling 30/3, you see that it states that “the law in general may be discussed, but one may not discuss the application …”, and that is what I have taken from it. I have said that the member may quote, but not comment on. The judge’s determination, which the member is quoting, is in the public arena, and I have said that the member is at liberty to quote that, but not comment on. That is the ruling that I have given.

GRANT ROBERTSON: What the judge has said is that the evidence in the case shows an apparent intention to treat as anonymous the donation given by Kim Dotcom. That donation was a donation that Mr Banks met with Kim Dotcom—

Hon Dr Nick Smith: I raise a point of order, Mr Speaker. The member immediately ignored your ruling. He was quite entitled, as you said, to simply quote what the court said. The moment he finished that, he then went on to a commentary on the evidence, specifically in respect of Mr Kim Dotcom. The member cannot litigate. The Standing Orders and the Speakers’ rulings are very clear that the member cannot litigate the matters that are now to stand trial with regard to Mr John Banks.

Hon Clayton Cosgrove: There is one point that Mr Smith failed to make, which is that he cannot litigate your ruling. He is not the Speaker; you are the Speaker. You determine what is in order, not him.

Mr DEPUTY SPEAKER: I do not actually need to be reminded of that. Can I firstly say that I was distracted while the member was speaking. I am sorry; I was doing some research on the matter. This is actually a matter of balance. I think that the question that the member is raising pertains to a member’s relevance in this House—that I understand. But I have been very clear that the member cannot litigate comment on the judge’s ruling. The difficulty I have also is that I do not actually have in front of me the judge’s ruling to know what the member is quoting from and whether he is maybe adding to it. So I am cautioning the member to very clearly understand what I am saying, and I will listen with greater attention now.

GRANT ROBERTSON: How long have I got now?

Mr DEPUTY SPEAKER: The member has 2¾ minutes.

GRANT ROBERTSON: John Banks has consistently said in the public arena that he did not know—

Hon Dr Nick Smith: I raise a point of order, Mr Speaker.

GRANT ROBERTSON: No.

Hon Dr Nick Smith: I want to directly read the Standing Order. Standing Order 112(1) says this: “Matters awaiting … any New Zealand court may not be referred to in any … debate,”—may not be referred to in any debate.

GRANT ROBERTSON: Did I refer to it?

Mr DEPUTY SPEAKER: Order!

Hon Dr Nick Smith: The immediate point that the member went into was a debate specifically about what John Banks had said publicly on the very matter that is now going to stand trial in Auckland. It is not appropriate—it is not appropriate—for this Parliament to assert the right that the court now has to resolve this issue.

GRANT ROBERTSON: Speaking to the point of order, I had got out only about half a sentence on that occasion before Dr Smith stood up. I had not mentioned anything about the court at that point, at all. What I was about to refer to were statements that John Banks has made in public relating to his campaign for the Auckland mayoralty. I was going to go on to talk about statements that John Key has made about whether a Minister’s lying would constitute whether or not he should keep them on as a Minister. Dr Smith did not even give me the chance to get to that point. I have listened to your ruling and I am going to speak in accordance with it.

Mr DEPUTY SPEAKER: Yes. I will again read Standing Order 112(1), which is pertinent to legislation, and that is my interpretation on it: “Matters awaiting or under adjudication in, or suppressed by an order of, any New Zealand court may not be referred to in any motion, debate, or question, including a supplementary question, subject always to the discretion of the Speaker”—

Hon Dr Nick Smith: And the right to legislate.

Mr DEPUTY SPEAKER: —“and to the”—

Hon Dr Nick Smith: So what the Standing Order is saying is that this requirement not to debate issues does not prevent Parliament from being able to get on and pass law, and I agree with that. But can the member debate the very matters before the court that will be subject to a court ruling today? And the answer is very clear from that Standing Order that we must let the High Court do its job and make the judgment as to whether Mr Banks broke the law or not.

Mr DEPUTY SPEAKER: And that is why I have said that the member can go as far as quoting, but not debating. That is what I have said. Now let us see whether we can make some progress.

GRANT ROBERTSON: And where are we at now?

Mr DEPUTY SPEAKER: 2½ minutes.

GRANT ROBERTSON: Very good. John Key came into the office of Prime Minister saying that he would hold his Ministers to the highest ethical standards. He also came into this Parliament and said that he would stand a Minister down if that Minister lied to him. Those are the standards that John Key has set and those standards have been broken by John Banks. This is a shoddy, tawdry Government, propped up by a member of Parliament who has consistently misled New Zealanders and whose memory is such that he cannot remember getting in a helicopter, flying to the Coatesville mansion, and having lunch with Kim Dotcom and a woman whom he described at the time as the most attractive woman in New Zealand. He cannot remember that. He cannot remember asking for a $50,000 donation to be split into two. He cannot remember getting a donation passed across the table—

Hon Dr Nick Smith: I raise a point of order, Mr Speaker. The member is immediately breaching your ruling by getting straight back into the debate on the very issue that is going to stand trial. I think you need to hold to the standards of the House—long established—that you cannot debate a matter before the courts, which is what this quite clearly is.

Hon Clayton Cosgrove: I did make a point before, Mr Deputy Speaker, and—I mean no offence—you may have misinterpreted it. I was actually trying to defend your position. That member needs to read the Standing Orders. You are the sole judge—

Mr DEPUTY SPEAKER: Order! I do not need this. I do not need—[Interruption] Order! Thank you very much. Look, I am trying to steer a course of balance here and uphold the Standing Orders. I have made it clear that the member can refer to but not comment on, and I think that the member was getting into that order. He was fine until he got to some of the detail around that, so I will give him 1 minute and 20 seconds.

GRANT ROBERTSON: I raise a point of order, Mr Speaker. The case that is before the District Court is around the question of whether or not Mr Banks had knowingly filed a false electoral return. In the period when I was speaking, before Dr Smith interrupted me again, I was speaking about a set of facts that are actually not relevant to whether or not a return was filed. Whether Mr Banks has forgotten that he had flown in a helicopter to the Coatesville mansion is not a matter that is currently before the court. So, knowing that, I will carry on with—how long is left?

Mr DEPUTY SPEAKER: Just over a minute.

GRANT ROBERTSON: Just over a minute? This Government relies on John Banks’ vote to pass critical legislation, such as the legislation implementing the Skycity deal. That is what stands between the Government and passing its law, and that is why it has such a desire to protect John Banks. Nick Smith spent about 20 minutes trying to protect John Banks. He is doing that because this Government knows that it is standing on only the record of a man who will stand trial for electoral fraud.

John Banks should not be a Minister, because John Key should have stood him down when the police report came out about this last year, but John Key would not even read the police report. He closed his eyes because he did not want to know the truth. Now he will have to face up to the truth. John Banks will stand trial for electoral fraud. This Government will stand on the basis of that tawdry, shoddy behaviour. John Key must stand John Banks down.

GARETH HUGHES (Green): Kia ora, Mr Deputy Speaker. Ngā mihi nui ki a koutou. Kia ora. We have seen some gripping television on our screens this week. We have seen the Te Kōhanga Reo National Trust Board credit card scandal. Tonight and on Twitter we are going to see it about the member Banks, now we have seen the judgment from the District Court. We are going to see this Government questioned, because this Government is hanging by a thread on the single vote of this member, who we now know, resulting from a District Court judgment, is off to court to make his case. But on Monday night was the gripping television and the trending Twitter that I want to refer to. On Monday night we saw a Minister out of his depth. We saw live, on Campbell Live, a Minister have his own uncontrolled blowout, live on television, and Kiwis around the country—particularly in the regions affected by deep-sea drilling, like the Kaikōura region—are questioning how this Minister, if he cannot control himself on television, is going to control a well blowout 2.7 kilometres down, off the Kaikōura coast? How is the Minister of Energy and Resources going to control that?

The fact is that the Minister cannot point to even a single person in Kaikōura—cannot point to a single person—who supports the Government’s “drill it, mine it, frack it” agenda, the agenda to put at risk our environment. In fact, we have got a Minister who thinks his job is to go on television and defend the reputation of Anadarko, not defend the beaches, the economy, and the climate of New Zealand. For an agenda the Government says is so popular, it is intriguing that the Minister for the Environment, Amy Adams, has proposed to make the exploratory stage—the riskiest phase; the stage we saw release 600,000 tonnes of oil into the Gulf of Mexico’s environment—a non-notified activity. If this Government wants to stand by everything it is doing for the oil industry—and there is an awful lot, because this Government is all about cosy deals for its mates—and if this Government is so proud of its agenda, why is it blocking out the public from getting a say whatsoever?

What we saw last week, however, was some more advice that the Government should be taking. We saw the Secretary-General of the OECD, Mr Angel Gurría, call for no—no—new fossil fuel emissions by 2050. It is inconsistent for this Government to be going out there in the deep waters off the Kaikōura and Canterbury and Taranaki coasts to be looking for new oil when the OECD is saying we need no new emissions. We saw the week before the Intergovernmental Panel on Climate Change release the most authoritative scientific update on climate change. What we know from that report is that there is more carbon dioxide, more methane, and more nitrous oxide than at any time in the past 800,000 years—probably much longer. We know from the world’s top scientists that climate change is happening. It is happening because of us. It is happening faster and worse than feared in previous reports, and it is going to have huge costs—huge social costs, huge costs on communities and people, and huge costs on the economy.

We also saw a report out from the International Energy Agency. What we saw in the report was the International Energy Agency saying that we cannot burn 70 percent of all the oil known about in the world if we want to achieve the Government’s own target of avoiding 2 degrees warming this century. The International Energy Agency is saying we cannot burn 70 percent of the oil we have already discovered, let alone this Government going off and trying to find some more deep in the waters off the Kaikōura coast. But this Government is all about deals for the oil industry. What we have seen is this Government provide $46 million in tax breaks in the last financial year. We see the Government constantly changing legislation to support the industry. We see this Government literally calling out the navy when iwi protesters get in its way. We see the Government taking away the public’s say. We see this Government’s job as acting as cheerleader-in-chief for the oil industry, going on telly and defending Anadarko’s reputation. It is incredible that Simon Bridges would go on TV and say: “Well, you’re being unfair and biased if you don’t have anything positive to say about the worst ever oil spill in the world’s history.”

I am sure Phil Heatley was sitting at home, watching Minister Bridges on TV on Monday night, with his palm over his face wondering “What is this Minister doing? This young guy is absolutely out of his depth when it comes to oil.” The fact is, though, that we have seen a consistent pro - oil drilling agenda from this Government. The better idea, of course, is to listen to the OECD say “No new fossil fuel emissions.”, and to listen to the International Energy Agency say “Keep the oil in the ground.”, and to listen to the Intergovernmental Panel on Climate Change and act to protect our climate. This is where the jobs and prosperity will come from in New Zealand. A richer New Zealand is not going to come from hoping someone finds something in the bottom of the water and does not leave too much of a mess. The prosperity is going to come from a smart Green economy.

MOANA MACKEY (Labour): John Key must stand down his Minister John Banks. That is clear. The allegations against Mr Banks of electoral fraud are so serious that it is not appropriate that a Minister of the Crown remain in that position. The allegations against him are now going to be taken to court. John Key must act now to stand down John Banks. This is a Government being propped up, passing controversial legislation against the best interests of New Zealanders, by one man who is now facing charges of electoral fraud.

Hon Clayton Cosgrove: Rotten.

MOANA MACKEY: That is rotten to the core. Prime Minister John Key must act now to restore the credibility of this House and this Parliament. When John Key became Prime Minister we heard a lot about how he was going to hold his Ministers to the highest ethical standards, and if they did not meet those standards, then he would stand them down. Well, he has failed that test today. There should be no question as to whether John Banks remains a Minister in John Key’s Government—no question at all—given that these are allegations of electoral fraud. For a member of Parliament to be facing those allegations is devastating, but, as a Minister of the Crown, it is not appropriate that he remains in that position. We wait, still, to hear what the Prime Minister, John Key, is going to do, and what has happened—

Hon Dr Nick Smith: He’s only had an hour.

MOANA MACKEY: —to those highest ethical standards he once held. This is a case that has not just been in the last hour, Dr Smith. This goes back many, many, many months—many, many, many months.

Hon Clayton Cosgrove: He’s already been convicted once.

MOANA MACKEY: As my colleague says, he has already been convicted once. So we should not be put in this position, with the credibility of this House being undermined. But, unfortunately, what we have seen from this Government has been low standards for Ministers right across the board.

The previous speaker, Gareth Hughes, mentioned the Minister of Energy and Resources and his performance on Campbell Live the other night—his extraordinary performance. Phil Heatley would never have behaved like that on Campbell Live as the Minister of Energy and Resources. It was an extraordinary performance. I think anyone tuning into that performance would have been asking themselves “Who is this ‘Miss Anna Darko’, and why is the Minister Simon Bridges so taken with her?”. It was the most extraordinary performance from a Minister of Energy and Resources who is meant to be neutral. Remember, this is the man who now has half the decision-making power over whether these activities go ahead in the Department of Conservation estate.

Does anyone seriously believe that Simon Bridges is ever going to say no to an oil company? Is he ever going to say no after that performance on Campbell Live, where he completely dismissed the very genuine concern of the people of Kaikōura—the very genuine concern? This is the community that Phil Heatley, when he was the Minister of Energy and Resources, promised would be able to have a say through a public submission process on any deep-sea drilling. Phil Heatley promised them that. Good old Phil Heatley—a good Minister of Energy and Resources. Then we get Simon Bridges, who comes along—along with Amy Adams, the supposed Minister for the Environment, although she is the Minister constantly acting against the environment—takes that away, and makes a lie of Phil Heatley’s promise to the good people of Kaikōura that they would have a say on any deep-sea drilling that was going to go on off their coast.

The reason this is so concerning is that the legislation Amy Adams has put in place governing this activity is so utterly bereft of any protection for the environment—any protection for the environment—that we have a very real risk of something going wrong. We saw what happened when something went wrong in the Gulf of Mexico. We saw what went wrong. The Minister Amy Adams got some advice from her officials when she asked what the impact of an oil spill would be on New Zealand, and she came to the House and said: “Well, the officials said it may well be significant.” Well, we got those documents, and what the officials said was that it will very likely be catastrophic. I think there is a bit of a difference between “very likely catastrophic” and “may be significant”. [Interruption] Amy Adams says that is quibbling over words, but my concern is what those words represent, and what those words represent is the very real impact on our coastal environment of an oil spill under legislation that is so weak that it does not provide the basic environmental protections that the international conventions we have signed up to require us to provide.

This is a Government that is so desperate to grease the wheels for industry at any cost that it does not matter whether it is the rights of workers in New Zealand, access to low-cost pharmaceuticals, or our environment, which we rely on entirely for our economy—those are all up for sale under a National Government.

Hon KATE WILKINSON (National—Waimakariri): This week two words come to mind. One of them that we have heard a lot of is “exodus” and the other one is “droves”. We have heard that categorically there is a widespread exodus of people from the regions, and that people are leaving the regions in droves. My own region in Waimakariri is up 17 percent in population growth. It is hardly an exodus. Even Canterbury—where we have had the devastating earthquakes, and some areas have been more affected than others—as a whole, as a region, is up 3.4 percent. We have heard of the income going down in the regions, etc., but if we look at the official statistics in Canterbury, my own region, the real after-tax median income, inflation adjusted, has increased by 14 percent. So it is hardly an exodus from the regions and hardly a neglect of the regions.

If we look at the progress under our growth strategy in what have been somewhat difficult times, it is actually not a bad picture. We have got economic growth that is comparable with Australia’s. It is higher than almost every other developed country. We have got wages that are growing, we have got cost of living increases that have been modest, and we have interest rates at 50-year lows. I remember my own first mortgage was at 21 percent. It is a lot lower than that now. We have heard that New Zealand is the fifth fastest-growing economy in the developed world. After-tax wages are up 22 percent since 2008, which is over twice the inflation rate. Gross wages have increased 14 percent. This means that real after-tax wages have increased 12 percent since September 2008, and I think that is a good picture that we are painting. There are more than 60,000 more jobs—that is 60,000 jobs—in the economy than there were 2 years ago.

If we look at what we inherited, we inherited an economy where the current account deficit was almost 9 percent of GDP, and now it is only 4.3 percent of GDP. So that is from 9 percent down to 4.3 percent. Good progress. We inherited an economy where the net external debt had blown out to 84 percent of GDP, and now it is 71 percent of GDP. So that is 84 percent of GDP down to 71 percent of GDP. Again, good progress. Inflation was then running at 5.1 percent and now it is running at 1.4 percent. As I have already mentioned, mortgage interest rates averaged 10.9 percent and now they average about 5.9 percent. So under our growth strategy I think we would have to say that reasonable progress has been made.

Then I thought, well, what is the growth strategy of the Opposition? And I found a speech that was delivered recently. There were two versions of this speech, mind you. One was inside the conference and one was outside the conference to the media. I am not sure which one prevails, but none the less I think I got the gist of what it was, and it was a bit like this: the 90-day trial will be gone by lunchtime. This is a trial period that has actually proved to be successful. In its first year of operation it was credited with creating 13,000 new jobs. At the time, 5 years ago, we were told that there would be queues of people, queues of exploited workers, who would come to us and say that it does not work. So we said: “Bring them to us. Give us the details of who those exploited workers are.” Did we get one? No, we did not. So a successful policy—which created 13,000 jobs each year—would be gone by lunchtime under Labour, and Labour members think they care about jobs.

Then we heard that the minimum wage would be immediately raised to $15 an hour. Well, I think that is about 5,000 jobs. So at the stroke of a pen: $15 an hour. It does not matter whether it is affordable or not; another 5,000 jobs are gone. That is about 18,000 jobs. Then we hear about this living wage. I am not sure what this living wage is. It is the policy that is being delivered by somebody out there who should know better. A living wage: $18.40 an hour. We are not quite sure what it is pegged to, but I think that is 26,000 jobs—

Dr MEGAN WOODS (Labour—Wigram): There can be no surer sign that you have a lame duck, an incompetent Government, opposite than when what we can discuss in this House is governed by what is currently before the courts. We have a Minister of Education who cannot and will not answer questions on her failure to run a real process around the closure and merger of schools. We now have Nick Smith taking about 20 minutes out of this general debate trying to shut down discussion—

Mr DEPUTY SPEAKER: Order! [Interruption] Order! The member cannot refer to points of order that have actually been addressed.

Dr MEGAN WOODS: We now are limited in what we can discuss about the fact that there is a Minister who is facing charges in a court about his conduct around electoral fraud. So we have Ministers from this Government all over the place. One is up the river in a cabbage boat.

The one whom I want to talk about today, to continue on that transport theme, is the one who is being a significant roadblock in the recovery of Christchurch. Eight months ago Gerry Brownlee, the Minister for Canterbury Earthquake Recovery—and the Minister of Transport, I will add—went out and promised that we would have a workable transport strategy for the recovery of the central city of Christchurch. That was, according to Minister Brownlee, going to be an important milestone in the recovery of Christchurch. Well, Minister, we are still waiting. Your milestone is nothing but a millstone. You have not delivered it. In November of last year you released, to much fanfare, a transport strategy for discussion. People duly submitted, as they do when there is a plan out, and in February that all came back. Minister Brownlee was to have taken that to Cabinet in March or April of this year. He has not done that.

Let us go through the time line. On 27 June the Minister announced the cost-sharing arrangement with the Christchurch City Council for this transport strategy. There was money already allocated in Budget 2013 for the Crown’s share of getting the transport system in Christchurch right. On 1 July Brownlee’s office received advice from the Canterbury Earthquake Recovery Authority that the office needed to crack on with this, and that what it was doing was slowing down the recovery of Christchurch. Minister Brownlee received a briefing that showed that the approval of the transport plan was now urgently required to enable the commissioning of key works needed to support the early delivery of the anchor projects in the central city. Was this enough to spur Minister Brownlee into action? No, it certainly was not. Minister Brownlee, despite advice on 1 July that he needed to crack on with things, still has yet to take that paper to Cabinet. Meanwhile Christchurch’s recovery and Canterbury’s recovery are significantly stalled.

What do we have from the Minister now? Well, the Minister hopes—he hopes—to sign this off by Christmas. So imagine this: it is 4 p.m. on Christmas Eve, and Gerry Brownlee is frantically running around trying to deliver the last of the Christmas presents on his list. “I know,” he thinks—

David Shearer: Ho, ho, ho.

Dr MEGAN WOODS: Ho, ho, ho. Thank you, Mr Shearer. “A workable transport system for the Christchurch central city is perhaps something I should deliver on. I have been promising it for quite some time now, but I cannot bring myself to wrap it and let it go.”

Well, Minister Brownlee, Christchurch’s recovery is being slowed down by your failure to deliver this paper and to deliver this plan. You have got the paper sitting there—you have not, Mr Deputy Speaker, but the Minister has the paper sitting there. It needs to be signed off. We cannot afford to have the kind of slowing down in Christchurch, both figuratively and literally, that the Minister’s failure to act on this is delivering. An approved transport plan at the centre of our city is not a “nice-to-have”; it is fundamental to our recovery as a city and as a province. His own officials are telling him that it is urgent. His own officials are telling him to crack on with it, get on with it, and not allow the slow-down. Every person who drives around Christchurch knows we have a broken transport system.

Hon PHIL HEATLEY (National—Whangarei): There must be hundreds of Labour voters across the country—in fact, I think there are possibly thousands of Labour voters across the country—but I would imagine that most of them are feeling pretty disillusioned because the Labour Party, even after 5 years, just does not look ready to govern. In the last 5 years the Labour Party is up to its fourth leader. There have been four leaders in 5 years: Helen Clark, Phil Goff, David Shearer, and now leader No. 4, David Cunliffe.

The difficulty, of course, is that although the Labour Party keeps changing its leaders, it has done nothing about the issue of renewal. I remember this when we went out of Government in 1999. There was that period of renewing and refreshing. What the Labour Party does is it changes its leader, but the MPs behind them are old and tired, so it is a bit like painting over rotting timber. They coined a phrase back in 1999—I think it was “dead wood”. The problem with the Labour Party is that it keeps painting the dead wood, the rotting timber on its fourth Labour leader.

The problem is that when you are inward-looking, you keep changing your leader, and when you have stopped making policies, you start making things up. That is what we saw from David Cunliffe this week. He was caught out quoting what the 2013 census would actually say, and he was caught out with his statistics. What the new Labour Party leader No. 4 said was that “real median weekly incomes have dropped since the last Census by $45 in Southland, $50 in Waikato and $24 in Taranaki.” Actually, since the census, real median after-tax weekly incomes have increased by $76 in Southland, not gone down by $45; they have increased by $43 in the Waikato, not gone down; and they have increased by $85 in Taranaki, not gone down. The Leader of the Opposition is making things up. What I was interested in was that the TV cameras probably turned off as he was quoting those facts and statistics that were all wrong. He went on to say that Jacinda Ardern won Wellington Central, Clayton Cosgrove is doing advertising for Pantene, and Grant Robertson is actually 6 foot 7! This is a Labour leader who does not give truthful statistics, and I do not know whether that is knowingly or not.

The fact of the matter is that Government spending went up by 50 percent during the Labour tenure. It is actually well under control now, despite the pressures of the recession, the global financial crisis, and the Canterbury earthquakes. Inflation was running at 5.1 percent; we are now enjoying an inflation rate of only 1.4 percent. Of course, people will remember—in fact, first-home buyers will remember—mortgage interest rates at about 11 percent. They were around the 9, 10, or 11 percent mark under Labour, but, of course, they are averaging about 6 percent at the moment. If you are a first-home buyer, you would prefer interest rates to be around 5, 6, or 7 percent, not the 9, 10, or 11 percent that you saw under Labour.

Interestingly, although the new Labour Party leader No. 4 said that population growth in the provinces was going down, I would like to say that in my area, in Northland, numbers actually went up by 3,000. The population rose by 3,000 in Northland. It was not all me. It was not all me; a lot of it is to do with Government policy and people just simply enjoying the north.

We know that offshore we have got endorsement for what we are doing. Standard and Poor’s recently affirmed New Zealand’s AA+ credit rating. The IMF is “very supportive” of what is being done by this Government. In its annual check-up of New Zealand’s health, the IMF said that National is on the right track with our plan to get to Budget surplus and that it strikes the right balance. So we have got third-party, international endorsement of what we are doing. We do not have to make up statistics. We do not have to present what are, in fact, false facts, as the Labour Party is doing. The facts speak for themselves. We are very proud of our record, and we will continue to roll out programmes that support New Zealand’s economic growth and jobs.

JOHN HAYES (National—Wairarapa): I was reading the Sunday Star-Times in the weekend and noticed that the fourth Labour leader threatened that his next Government would take the Wairarapa seat from National. Bring it on, I say, because he will be the fourth Labour leader to be proved wrong. Then yesterday I was reading what the fourth Labour leader was going to do next year and what advice he had on the census, which came out today. I will read from the statement, which said: “Census data being released tomorrow will depict a widespread exodus from the regions as provincial New Zealanders flee small towns forgotten by the National Government, Labour Leader and Regional Development spokesman David Cunliffe says.” He went on: “Something must be done to turn around the compounding effect on our regions of an aging population and a loss of opportunities.” It is clear that the fourth Labour leader has not visited my Wairarapa electorate recently, if ever. If he had, he would never have made either statement, as this morning’s Dominion Post shows. Can I read the headline to the House. It shouts from the paper: “Impulse buys joins cool Carterton’s boom”.

What is going on here? The evidence is in the Dominion Post. Carterton’s population has grown 16 percent since the last census. Phil Goff knows that, because in the adjournment he was deer shooting over in my electorate. And Steven Joyce, our Minister for business and regional development, knows that, because he spent part of his adjournment visiting my electorate and meeting a broad cross-section of people. He wanted to listen to their ideas, which the Government could adopt to create jobs. He met Adrienne Staples, Mayor of South Wairarapa, who told him that the population in South Wairarapa had grown by 7.2 percent over the census period. He met Masterton’s mayor, Garry Daniell. I will just for one second say what a superb job Garry has done for the people of Masterton over many, many years, most recently as mayor of that community. He told Steven Joyce that after a period of stagnation going back to 1986, the Masterton community was again growing, and in the census period had grown by more than 3 percent.

Wairarapa News writer Piers Fuller was wrong when he wrote on 10 October last year: “South Wairarapa has 9120 people now and is expected to have 9300 by 2031.” I am really sorry, but both Piers Fuller and David Cunliffe got that wrong. South Wairarapa had 9,528 people on census night in March of this year—18 percent growth in the Kahutara part of that electorate. I noted earlier that our population has been static or in decline since 1986, so why has it started to grow since 2008? It is pretty simple—the arrival of the John Key - led Government. The economic recovery he has brought about is gaining momentum, and it is driven by low interest rates, it is driven by investment, and it is driven by strong export prices.

As Steven Joyce discovered in the Wairarapa last week, business and consumer confidence is improving as companies become more competitive and exports are growing. Companies like Harvest Electronics—eight new jobs in the last 12 months, taking the company from 10 to 18 people. If you think about Metalform (Dannevirke), it has got more than 50 jobs now and they are growing and moving to Ōringi. There is a major supermarket company about to come into Dannevirke, creating 50 new jobs. Economic growth in our provincial part of New Zealand is comparable with Australia’s and higher than almost every other developing country’s. Our economy is forecast to grow between 2 and 3 percent a year over the next 4 years. That is why the provinces are not losing people.

The reason that Labour has no prospect of recovering the Wairarapa seat in the next election is, first of all, it wants to bring back a capital gains tax. That would punish business and farmers. Labour would want to promote a big gap between the companies tax rate and the top personal income tax rate, which would encourage tax avoidance. Labour would want to impose large costs on business and farms with a more punitive emissions trading scheme. The Wairarapa electorate knows and New Zealand knows that we need more taxpayers, not more taxes. Thank you.

The debate having concluded, the motion lapsed.

Bills

Telecommunications (Interception Capability and Security) Bill

In Committee

Part 1 Preliminary provisions

CLARE CURRAN (Labour—Dunedin South): I want to give a bit of an introduction to Part 1 of the Telecommunications (Interception Capability and Security) Bill, to the bill in general, and to where Labour stands on this, which is strongly opposed to this bill in its entirety, but certainly starting off with our reasons for opposition to Part 1. This bill, as we know, replaces the Telecommunications (Interception Capability) Act of 2004. It is certainly needed and there is justification for an updating and a modernisation of this legislation. One of the things this bill does is it adds a new component to this piece of legislation. It is called “security”.

This bill is problematic for numerous reasons. It is the companion bill to, or the facilitating bill of, the changes that this Government pushed through under the Government Communications Security Bureau Act. That bill failed to provide enough protections for New Zealand citizens’ privacy. We contend that this bill certainly reinforces that but also fails to take into account economic issues, the costs to New Zealand telecommunications and technology companies, and also the issues of data security and the rights of those companies.

This is a very one-sided bill. It involves a major expansion of Government powers over network providers, through the Government Communications Security Bureau (GCSB) and through providing extensive and unprecedented powers to Ministers in different parts of this bill. It gives Ministers extraordinary powers, in some cases without precedent in New Zealand. We will certainly have more to say on that as we go through the different parts of this bill. It creates broad, sweeping powers. It increases the role of the GCSB overall—its role in the decisions by network operators and the information that must be provided to them.

This bill, we contend, was not well drafted. We say that in all seriousness. We say that knowing that, in general, much of the legislation that comes before this House has been well drafted and a lot of thought and attention has gone into it. Our contention is that the concerns of submitters, the concerns of industry, and the concerns of civil society have been ignored, pretty much, during the course of the bill going through the Law and Order Committee. We think that there are serious issues in definitions. Certainly, in Part 1 we are addressing that.

Today we have tabled in the Chamber Supplementary Order Paper 370, which contains 10 amendments to this bill. Four of those relate to Part 1 and we will be addressing them as we go through the discussion today. The Law and Order Committee did make some changes to limit and clarify powers and processes but we believe that they were not enough. There was a last-minute Supplementary Order Paper 366 from the Minister for Communications and Information Technology, which has left many, many questions around what the implications of that are. There has been an inability to discuss that and seek advice on those matters in the select committee. There was an attempt to refer this bill back to the select committee yesterday, which, naturally, failed, but as a result we therefore do not know what the impact of the Minister’s last-minute Supplementary Order Paper actually is.

Part 1 includes the interpretation clause, which several of Labour’s Supplementary Order Paper amendments relate to. I will quickly run through what they are. They deal with, and relate to, clause 3 in Part 1, firstly deleting the definition of “national security”. This is important. There were many submissions and there has been much discussion around this part of the bill, because this definition of national security includes a concept called “economic well-being”. As I said earlier, there are a number of things that are unprecedented in this bill, and this concept of economic well-being is one of them, which has not been anywhere in this bill spelt out as to how it relates to national security, what that means, what factors are taken into account when those decisions are being made—that national security is important—and how economic well-being fits in with all of that. Our remedy for this is to delete this clause altogether because it is essentially meaningless and it creates more questions than it answers. So we have put a Supplementary Order Paper forward to delete that particular definition, which is on page 10 of the version of the bill that I have in front of me. By removing the term “economic well-being”, if we attempted to do it that way, it would make the clause redundant, so we believe that the best remedy is to actually delete the whole of that sentence altogether.

The second amendment that we are proposing is to amend the definition of “network operator”. There is going to be a lot of discussion about that particular issue as we traverse this bill today, because of the enormous, wide definition of “network operator” and the potential for encompassing so many different organisations and entities in New Zealand particularly. There are two issues there and two clauses here that we are going to amend. One is the definition of “network operator”, and the other is the definition of “service provider”. Both, again, create more problems than they solve in attempting to deal with the intent of this bill. It is our contention that they must be amended. During the select committee process we ended up with a wider version of “service provider”, and it has made the issue much more complex.

In our amending of “network operator” we say that the bill as drafted places onerous obligations on network operators, and may capture many who were not be intended to be caught. This is the same with the definition of “service provider”. Our contention is that we should return the clause to the one that was originally introduced into the select committee. As has been discussed in recent days, the revised definition of “service provider” now potentially includes anyone outside New Zealand who makes a telecommunications service available in New Zealand. On the one hand you have got a definition of “network operator” that could potentially apply to every website operating in New Zealand that has a communication with members of the public. The definition of “service provider” could capture anyone outside New Zealand who makes a telecommunications service available in New Zealand. It is our belief that this was not, and should not be, the intent of the bill and therefore we say that that should be amended.

Finally, we are inserting a new definition of “surveillance agency”, which clarifies that this term applies only to New Zealand agencies. Again, the discussion in the select committee was very unclear on this matter. It is our fear that it was meant to be wider than that. I would like to hear from the Minister her view, during the course of this discussion, on whether that was her intention. Was it meant that the definition of “surveillance agency” was to include only New Zealand - based agencies, or was it meant to be a much broader definition?

We have 10 different amendments to discuss during the course of this bill. These particular four relate to Part 1. They are core to the whole bill because everywhere that those terms are used—

GRANT ROBERTSON (Labour—Wellington Central): I was momentarily distracted by some news about one of our parliamentary colleagues, Mr Banks, that I am sure another colleague will confirm shortly, but it seems he may have seen the light for once. I want to speak on Part 1 of the Telecommunications (Interception Capability and Security) Bill.

Hon Trevor Mallard: He’s got the message, unlike John Key.

GRANT ROBERTSON: Yes, that is right, Mr Mallard. I want to carry on from where my colleague Clare Curran left off, and talk particularly about a variety of matters within the interpretation clause, which is clause 3 of the bill. But before I do that I want to set the context for those interpretations. That is provided by the purpose clause, which is clause 5 of the bill. The purpose of the bill in relation to interception capability is to “ensure that surveillance agencies are able to effectively carry out the lawful interception of telecommunications under an interception warrant or any other lawful interception authority;”. That is the first purpose of this bill.

That may sound innocuous to people listening to the House today, but the reality is—

Hon Amy Adams: It is.

GRANT ROBERTSON: The Minister for Communications and Information Technology says quietly under her breath that it is innocuous, except it is not. It is not innocuous, because of legislation that has previously been passed in this House, and that is the Government Communications Security Bureau (GCSB) legislation. It is worth, in the context of Part 1, traversing the fact that the surveillance agencies that have been referred to—just for the benefit of the Committee, John Banks has resigned as a Minister but he is still the MP for Epsom. So I am sure the people of Epsom are very grateful for that.

The purpose of the bill, it says in clause 5(a), is to ensure that surveillance agencies such as the GCSB can carry out the interception that they are entitled to do under law. That right of the GCSB was vastly expanded under the GCSB legislation. It is not right to simply say that this is an innocuous provision, as the Minister has tried to claim, when in reality the very surveillance agencies that are covered by this legislation have had their powers expanded. The way in which those powers have been expanded primarily relates to their ability to spy on New Zealanders. The GCSB legislation also expanded the ways in which that surveillance could take place.

But it is essential to note that one of the main reasons that the Labour Party has a problem with this legislation is that it is legislation that operationalises the GCSB legislation. The widened powers, the ability to spy on New Zealanders, are given life in this bill. We believe that that legislation that was passed by this Parliament is deeply flawed and fails to strike the correct balance between protecting the security interests of New Zealand and giving New Zealanders the freedom to operate. That balance has been lost. It has now been totally lost from the intelligence agencies in New Zealand, and here we have a bill that puts that into practice. That is why the purpose of this bill as stated in clause 5 is wrong.

The purpose clause then goes on to talk about network operators and service providers having the “freedom to choose system design features and specifications that are appropriate for their own purposes.” Let us just read that again: “network operators and service providers have the freedom to choose system design features and specifications that are appropriate for their own purposes.” Well, I am sorry to say that the bill does not achieve that purpose. All of the network operators and service providers who came to the Law and Order Committee said that that is the very thing they now will not be able to do, because the Government is now going to be involved in the design of their networks. The Government is going to be able to have a say in how those networks operate. The Government is going to be able to monitor those networks. So clause 5(c) in Part 1 is completely impossible under the rest of this bill.

It is not just Opposition politicians who are saying this. Members of Parliament have all received an open letter from the NZRise group. In that open letter the group is pleading with the Government: “Don’t rush this legislation through.” The Government has not thought it through properly. The service providers and the network operators, whom this law affects, are saying that they are not clear what it means. The lawyers whom those people have consulted are not clear what it means. The Minister keeps saying “Well, we know what it means.”, but the very people whom it affects are not able to interpret this law clearly.

Those people are calling on the Government to say that this law does not reflect the purpose in clause 5. If the purpose is to allow network operators to have the freedom to choose system design features, then that is exactly what the rest of the law should do, but it does not. The purpose clause sounds good when you read it on a superficial level, but in terms of clause 5(a) around surveillance agencies and clause 5(c) around network operators the rest of the bill fails to allow those purpose subclauses to come into action.

I then want to refer back to the questions of who is a network operator and who is a service provider, and that is dealt with for us in clause 3 of the bill. As my colleague Clare Curran has already made clear, the definition of “network operator” is now potentially so broad as to include just about anybody. It could include your local school. I was down in the press gallery just a few minutes ago, discussing the matter of John Banks and his political life. I looked around the Fairfax office—

Hon Trevor Mallard: The life and death of John Banks.

GRANT ROBERTSON: That is right—the very short political life remaining for John Banks. I looked around the Fairfax office and I said: “Well, you’re a network operator, I think. I’ve just had a look at the bill, and you’re a network operator.”

Hon Trevor Mallard: They get bugged anyway.

GRANT ROBERTSON: That is true—that is true. In deference to some of the staff members in the Fairfax office, they have already experienced what this bill is going to allow.

Iain Lees-Galloway: Isn’t that how they lost the last Minister?

GRANT ROBERTSON: It is how they lost Peter Dunne, as well. In all seriousness they are potentially, under the definition here, a network operator. It is a farcical situation for a piece of legislation to come to this Committee with a definition of “network operator” that could take into account schools, that could take into account offices. It is the kind of loose legislation that this Government unfortunately is renowned for, and it should not be going through this Parliament.

I refer again to the open letter from NZRise. It has made, I think, a very interesting statement here. It said: “The Bill places onerous obligations upon network operators. That term is defined through a tangled web of definitions drawn from the Telecommunications Act and then amended.” I could not agree more with that statement. The letter goes on to say the “definition’s second limb specifies that a network operator is a person who supplies (whether by wholesale or retail) another person with the capability to provide a telecommunications service.” If you then add in all of the other definitions, it is, essentially, anybody who is supplying another person with the capability to provide goods, services, and equipment that enable or facilitate “the conveyance by electromagnetic means from one device to another of any encrypted or non-encrypted sign,”. Just pausing there at that point—

Hon Trevor Mallard: Well, I am, because my kids use the thing at home.

GRANT ROBERTSON: Trevor Mallard is a network operator. That is a frightening thought for all of us. Trevor Mallard is a network operator. Under this bill we are potentially all network operators because of the “conveyance by electromagnetic means from one device to another of any encrypted or non-encrypted sign,”. If we enable that, when a parent sets up a network inside their home for their children to be a part of, they are now captured by this definition of “network operator” that is here. It is a farcical situation to have a definition like that.

I am not suggesting, necessarily, that the Minister’s intention is to capture a family’s network at home, but the bill is clearly poorly drafted in that regard. Or if it is not and it is the Minister’s intention, then all of the fears that New Zealanders have about the expansion of powers of surveillance agencies have come to pass.

So that is why we have Supplementary Order Paper 370 to revise the definition around “network operator”. We need to ensure that New Zealanders have the freedom to communicate with one another in the way that we do in the modern world. That means law that is appropriate and that balances the need for security and the freedoms and rights of New Zealanders. The definition of “network operator” that is contained within clause 3 of this bill is woefully inadequate, it is far too broad, it captures far too many New Zealanders, it creates enormous uncertainty among the public and among the telecommunications industry, and the Minister must change that definition.

The other definitions that we have got particular concerns about within clause 3 include that of a “service provider”. There was, in fact, an addition in the Law and Order Committee to say that a service provider meant anyone from within or outside New Zealand providing or making available in New Zealand a telecommunications service. This is an enormously wide definition of what a service provider is, taking in people not only in New Zealand but outside New Zealand. I am not even sure that the law can do this, and I think that that clause should also be altered.

TRACEY MARTIN (NZ First): Kia ora, Mr Chair. On behalf of New Zealand First I stand to oppose this Telecommunications (Interception Capability and Security) Bill. Originally, at first reading, New Zealand First reserved its judgment, predominantly to make sure that we heard the arguments at the Law and Order Committee, and so we supported the bill through its first reading. Since then it has become incredibly obvious that this is predominantly a bill that says: “Trust us. Trust us, New Zealand. Give us all these powers. We won’t necessarily use them, but trust us.” I think we have seen, even just today, that there are some standards that this Government has that need to be questioned, so “trust us” is not good enough, unfortunately, for New Zealand First.

We recognise that the bill basically is in two parts. One is around interception and the other is around network security. The network security aspects of the bill are largely technical in nature and deal with how the telecommunications sector and companies operating inside that sector will operate in relation to interception warrants. These technical aspects relate to the operation of networks—and we have just heard how wide that description is currently—and the examination and collection of information and data both through and from various network devices.

These areas are areas that are particularly subject to rapid technological change. The nature of individual and commercial use of networks and of network devices is also changing at an incredibly rapid pace and it is through this usage, by the very nature of its usefulness, that makes companies as well as Government agencies vulnerable to exploitation. Essential services, both public and private, may be subject to eavesdropping and cyber-attacks, with the potential for intellectual property to be usurped and the possibility that essential services to individuals and companies may be compromised.

New Zealanders deserve and expect to be protected from such potential threats and, as such, it is necessary to have legislation governing the interception of electronic communications, and it is necessary to update them, as required, as the cyber-environment evolves. But New Zealanders also deserve and expect that their Government will appropriately balance these protections of security with protections around their rights, their freedoms, and their civil liberties. Having recently just come back from a democracy that is only 2½ years old, and over a 20-year period prior to that lost all its citizens’ abilities to keep their freedoms and their rights, I say that we need to not take this flippantly. New Zealanders do need to continue to maintain vigilance around legislation, such as this, where a Government just says “trust us”.

We are in a good place. We are a good people, and a good democracy—150 years of unbroken democracy in this country; we do it well. But we still must be aware of what I refer to as “the invisible man theory” and that is when there is not enough oversight. When there is nobody watching the watchers, when there is nobody checking on the warrants, and those who have the powers are at arm’s length and removed from the powers that be, then there is the possibility that things will not go well in the future, and herein lies New Zealand First’s problem, which is why we will oppose the bill.

We will support Clare Curran’s Supplementary Order Paper 370 because we see there, particularly, the new insertion into clause 2 around an independent review of New Zealand security agencies. We hope that this in itself would make sure that the New Zealand public, and therefore the New Zealand First Party, could have confidence that their overview is appropriately there—that the independent overview is there. A change of Government given the same powers may not be the lovely, nice people who currently sit on the Government benches. They may be people who use these powers in another way that is not to the benefit of the people. It is necessary, therefore, for the New Zealand people to constantly have the ability to be confident that there is an oversight and that their Government is looking out for their welfare.

It is also of interest to us that four of the largest internet providers of content and email, Google, Yahoo!, Microsoft, and Facebook, gave advice to the Law and Order Committee that this legislation would create legal conflicts with other countries and that the law is out of alignment with approaches taken by the UK, Canada, the United States, and Australia—the “Five Eyes” arrangement that we are part of. The Minister for Communications and Information Technology rejected those comments. The Minister—

Hon TREVOR MALLARD (Labour—Hutt South): The first point I want to make is that I hung back a little bit from making the first of my four contributions on this part of the Telecommunications (Interception Capability and Security) Bill because I anticipated, given the long list of questions that the Minister for Communications and Information Technology had been given, that she would get on her hind legs and attempt to respond to them. But I am afraid that what I was thinking of was the old, promising Amy Adams—the Minister who was on the way up. Well, what we have now is a Minister in charge of this shambles, a Minister in charge of the Chorus network shambles and the Commerce Commission override shambles, and the Minister in charge of losing Peter Dunne on environmental legislation. What we see is a Minister in charge of this bill who is clearly someone for whom all of her potential is behind her. In the old days, when it was in front of her, she would have got up on her hind legs and she would have responded to some of the questions, but not today.

There is a particular case to do with the definitions that I want to put to the Minister. I think that she is aware of the school in west Auckland that is currently running a network with the help of one of the IT entrepreneurs whom I know she knows relatively well and Mr Joyce knows, as well. He is doing it pro bono, and they are working through that school in order to provide to the parents in the immediate area a wireless service of high quality, a lot of bandwidth, and a reseller-type arrangement, but at almost no cost to the parents. In fact, with the very small amount of money that comes in, the school is making some money out of it because of the way it is configured. In fact, in the future the school might even make some money out of franchising the arrangements so that other schools can do them, and so that parents in similar communities can get very, very cheap internet through the bulk buying arrangements that are available.

The question that I want to ask the Minister is whether that school is a network operator. Sorry, I am afraid that at the moment the Minister does not appear to be focusing. Is that school a network operator under the definition in this bill? Does it have to register with a person appointed by the Commissioner of Police or not? They do not. The Minister says that they do not. Well, how can you tell from reading this? You cannot tell from this, because according to the definition the school has customers, because “customer” is defined as “ … a person who receives telecommunications services from, and has an account or billing relationship with, a network operator”. These people—these parents who live in the community—get billed by the school. They pay through the school. The service is provided through the school. What is a school if it is not a network operator? It is clearly a network operator.

I want to refer to another one. I know this might go to the point of being nit-picking or looking into the fine print, but I think that is our job. As part of the Committee stage, we must go through the bill line by line by line. Since when has an email address been a number? This bill purports to tell us that an email address is a number. Well, you know, I am probably one of the least technologically aware people in this Parliament, but I know that an email address is not a number. Why should this Parliament mislead the people of New Zealand through its legislation and tell them that an email address is a number? Because it is not. My email address is trevor.mallard@parliament.govt.nz. I know that is not a number. I have got the Minister’s number, and I know that that is not a number. And so—

Chris Hipkins: What about the dots?

Hon TREVOR MALLARD: Sorry?

Chris Hipkins: What about the dots?

Hon TREVOR MALLARD: Are the dots numbers? I do not think dots are numbers.

Chris Hipkins: Decimal points?

Hon TREVOR MALLARD: Well, it is an interesting point, and I look forward to the Minister’s particular comments on that.

Could we go to the question of a “telecommunication device”. It says this means “ … any terminal device capable of being used for transmitting or receiving a telecommunication over a network;”, and it includes a telephone. Well, for people of my generation, back in the day you would wind it round and hear someone say “Working, working.” You used to have party lines in Wainuiōmata back in the old days. In fact, we thought it was enormous progress when we got numbers that had four digits. In fact, now they have the numbers “564” in front of them to indicate Wainuiōmata. The point that I am trying to make is that there are a number of devices where it is not clear whether they are terminal or not. I have had a number of cellphones that have been terminal—generally when I have dropped them or put them in a puddle—but is a device that forwards a message terminal or not? Well, I would tend to say it is not a terminal device, but I would also tend to say that the Minister is trying to capture it under this definition. Is a device that is capable of forwarding a message terminal or not? It is not the end of the line, because the message keeps on going. So that is another point that I would like to ask the Minister.

The next question I want to ask goes to the question of the registrar. The registrar is a person who is appointed by the Commissioner of Police—I will just get the exact words, because “appointed” is not quite the right word. Oh, no—“appointed … under section 68”. I will not go into clause 68, but the person who does the appointing, or the indicating of the individual officer, is the Commissioner of Police. The question that I want to ask the Minister is whether we are satisfied with that. Are we satisfied that any old constable could be the registrar? Are we satisfied that a civilian employee of the police could be the registrar for these purposes? The registrar for these purposes is something that is a very, very serious job. It is a job with enormous powers. A rejection by the registrar could close down Vodafone in New Zealand tomorrow, or Chorus, or Telecom, or any one of a number of companies, and 3degrees—I mean 2degrees; it was 3G that I was thinking about. Do the members know that I was part of the first trial of 3G in New Zealand? The phone that I used as part of that trial—

Phil Twyford: It’s in Te Papa.

Hon TREVOR MALLARD: —when I was Acting Minister for Paul Swain—no, it would not fit in Te Papa, it was so big. It needed its own massive van to move this particular—I presume it was a terminal device, although—

Moana Mackey: How old are you?

Hon TREVOR MALLARD: At least twice the member’s age.

The other point that I will make while we are on the subject of devices is that the first cellphone that I owned had a handset, a big black one, and it had a dial. It had a strap that went over my shoulder and it was a man bag. It was about that long, and about that high, and about that wide.

Hon Clayton Cosgrove: Did it have a crank?

Hon TREVOR MALLARD: No, the home phone had a crank. But the point that I am making [Interruption]—Well, it was not a party when Helen was on the line.

The CHAIRPERSON (Lindsay Tisch): Before we move on, I remind members that we are on Part 1. Although there is some [Interruption]—I will comment on this. Although it is always a little bit interesting to bring some humour in, we are on Part 1, and we will concentrate our efforts on Part 1.

Hon TREVOR MALLARD (Labour—Hutt South): I raise a point of order, Mr Chairperson. I feel like you might be admonishing me for the comments I made in my speech. I was asking the Minister whether these devices—

The CHAIRPERSON (Lindsay Tisch): The member will sit. I am giving a general view of how, over the next period of time, this is a very narrow debate on terms. We are on Part 1, and we will concentrate on Part 1.

CHRIS HIPKINS (Labour—Rimutaka): I am very happy to follow on from my colleague Trevor Mallard, who, amongst other things in his very useful contribution, established for the Committee that he is very, very old. I want to thank him for that. Of course, as we debate Part 1, which includes the interpretation clause of the Telecommunications (Interception Capability and Security) Bill—and I have got a number of points that I want to raise on the definitions—it is of course useful to remember why we are here, and how this whole debate came about. It came about because the Government Communications Security Bureau (GCSB), one of the agencies whose powers are significantly increased under this bill, was unable to read its own Act and to interpret the law as it stood. It was unable to do that, and this bill expands its powers. It was not able to stick within the law as it was, so the Government’s solution to the GCSB being unable to follow the law as it was is to increase the scope of the GCSB’s powers under the law. There are a number of reasons why the interpretation clause in this bill creates some huge concerns in that regard.

Of course, there is a little irony in all of this, in that the catalyst for this, the best example of the GCSB being unable to follow its own law, was the Kim Dotcom case. Of course, who was Kim Dotcom? He was John Banks’ big donor—

Hon Clayton Cosgrove: Brown bag.

CHRIS HIPKINS: —and, of course, John Banks lost his job today because of those brown bag anonymous donations.

The CHAIRPERSON (Lindsay Tisch): Order! Order!

CHRIS HIPKINS: Well, it is absolutely relevant, Mr Chair—

The CHAIRPERSON (Lindsay Tisch): Come back, come back. That has got nothing to do with it.

CHRIS HIPKINS: —and I am intending to come back to it, because I am going to come to the definition of “national security” because it is directly relevant to the Kim Dotcom case. It is absolutely relevant to the Kim Dotcom case. “National security”—according to this legislation—“in relation to New Zealand, includes its economic well-being”. How much broader could a definition of “national security” get than simply being economic well-being? This bill gives the Minister enormous powers simply on the basis of the country’s economic well-being. It does not necessarily need to suggest that anyone has broken a law or that any operator has broken a law, but simply that a Minister deems it to be in the interests of national security.

So in the Kim Dotcom case, Kim Dotcom and Megaupload may not have even been deemed to have broken any laws. It simply could have been the case that the Minister decided that it was not in the country’s economic well-being for the Megaupload operation to continue to operate. This is my understanding of how this bill operates, and I am sure my colleague Clare Curran will correct me if I am wrong. My understanding of it is that under this definition of “national security”, which is purely economic well-being, the Minister could effectively shut down Megaupload if she deemed it to be not to do with the country’s economic well-being. It is nothing to do with whether any laws have been broken, but it simply applies an economic well-being test. That is so, so utterly broad.

Amy Adams, the Minister in the chair, is shaking her head, so I am hoping that she will address this issue when she makes her contribution in this part of the debate, because I have never seen anything that defines national security and extends national security powers so broadly, yet has such a broad definition of what national security actually is. I think that that is incredibly concerning and I am looking forward to the Minister’s contribution on that.

Coming back to network operators and the definition of “network operator”, another question that I have for the Minister is whether the Government’s Network for Learning, which is being extended to all schools in the country and being made available to all schools, would come under the definition of a “network operator”. Clare Curran has just passed me some further information about the Network for Learning, although I am relatively familiar with it. We have got 21 schools, according to Nikki Kaye, being connected to the Network for Learning by the end of this year. I would actually quite like to hear from the Associate Minister of Education, Nikki Kaye, who is overseeing the implementation of the Network for Learning. She is on the phone, so I am assuming that means that she is getting some advice on this matter so that she can participate fully in this debate.

I would like to know what the implications of this bill are for the Network for Learning. It is going to be rolled out, from what we understand, to all schools in the country over time. It is a significant network, so let us look at what the network operator definition in the bill states. It states that a “network operator means a person who owns, controls, or operates a public telecommunications network;”. The Network for Learning, surely, must come under the definition of that, so what are the implications? This is a managed network for schools that is going to connect schools together via a secure data network offering high levels of service, quality, and support, so the Government, therefore, becomes a network operator under the definitions in this bill. So what are the implications for the Network for Learning and for interactions with kids, who might be using the Network for Learning, as a result of this? Is the GCSB now going to be snooping on kids and teachers throughout the country as a result of this legislation? Because under the definition of a “network operator”, the Network for Learning could well come within that definition.

Let us look at a “network security risk”. A “network security risk means any actual or potential security risk arising from the design, build, or operation of a public telecommunications network; or any interconnection to or between public telecommunications networks in New Zealand or with telecommunications networks overseas”. Again, it is a very, very broad definition—any actual or potential security risk arising from those things. So could kids working in schools be deemed to be a potential security risk and, on the basis of that, could we have the GCSB snooping in on the activities of schools and kids as a result of this legislation? I think we do want to have some clarity.

One of the problems with this bill is that the definitions are simply so broad. I am completely willing to admit that I was not part of the select committee process for this bill. I picked up this bill for the first time this afternoon and tried to make head or tail of it. I have to say that it is incredibly complex and incredibly difficult, but I have been alarmed in reading the definitions at just how broad they are and, when we get into Part 2 in particular, at just how sweeping are the powers under Part 2. The reason that, of course, the Part 2 powers are relevant to the debate on Part 1 is that the Part 2 powers all rely on the definitions that are established here in Part 1—those very, very broad definitions.

Let us look at the “other lawful interception authority”. That “means an authority to access an information infrastructure (within the meaning of the Government Communications Security Bureau Act 2003)” and “includes an authority to intercept a private communication (whether in an emergency situation or otherwise) that is granted to any member of a surveillance agency under any other enactment”. Authority to access an information infrastructure—so what is an information infrastructure? Let us go back and see what the definition of an information infrastructure is under this piece of legislation here. An information—oh, it is not defined. An information infrastructure is not defined. So, basically, we have got here, unless I might have missed it, but, no, I did not. No, I cannot see it here. So we have got it here that—

Dr David Clark: The Minister will correct you if you’re wrong.

CHRIS HIPKINS: —I am sure she will—it “means an authority to access an information infrastructure”. Well, what is an information infrastructure? How can we be having a definition with another definition contained within in it that is not then defined? It actually just makes a mockery of the whole thing. This bill is so poorly worded and gives such broad powers that it is almost certainly going to result in significant legal challenges to the Government, and the reason all of the New Zealand public should be concerned about that is that it deals with such a sensitive, delicate issue. It deals with the privacy of New Zealanders’ information and their interactions online and use of other forms of telecommunications.

I said in earlier debates on this matter that I think the issues around privacy and around what New Zealanders can expect when they are using information and communications technology is one of the biggest and most challenging issues that this Parliament is going to deal with over the next few years. What we have seen from this Government is that it deals with this debate in an ad hoc, piecemeal fashion, without a real, proper, thorough examination of the principles that should guide it, and that is why we end up with bad legislation like this.

For example, if we turn to the principles clauses in Part 1 here—I will get to the principles clauses, as I was reading them a moment ago. In clause 5 here, as part of “Purposes and principles”, we have got principles relating to an interception capability and we have got principles relating to network security, but there are no principles relating to privacy and no principles relating to the actual New Zealand citizen’s rights under this legislation. So surely in a principles clause—and Part 1 sets out the principles behind the bill—we should set out the principles under which the powers being granted by this bill should be allowed to be used. One of those principles has to be a balancing principle that protects the privacy of New Zealanders, and yet that is not in here. Fundamentally, when we debate this legislation—Clare Curran has mentioned this, and the Committee will find references to it in the Labour Party’s minority report—we have to get the balance between privacy and security right, because a democratic system relies on both of those things.

This bill basically says that the Government can ride roughshod over individual rights and freedoms in the name of security, adopting an incredibly broad definition of security. It is massively expanding powers, and it is not democratic, it is not fair, and it is not right.

STEFFAN BROWNING (Green): I rise to speak to Part 1 of the Telecommunications (Interception Capability and Security) Bill. Just looking at some of the interpretations, I will jump through to the infrastructure aspect. The “infrastructure-level service” means “any service that provides the physical medium over which telecommunications are transmitted …”, and it talks about the optical fibre. So, in other words, it talks about the hardware—not the hardware of the phone itself but the wires and the like. I remember in the Marlborough Sounds where we ran a telephone wire down to a neighbour’s—a sort of outrigger from our home. I realised that that wire between the baches or homes in the sounds would fit within that, and, obviously, that is something else that can be intercepted.

Something that concerns me more in terms of the interpretation is the definition of “Minister”. No disrespect to the Minister sitting in the chair, the Minister for Communications and Information Technology, but in clause 3 of the bill “Minister means the Minister of the Crown who, under the authority of any warrant or with the authority of the Prime Minister, is for the time being responsible for the administration of this Act …”. Now, at the moment, it is the Minister for Communications and Information Technology, and I think there is a real role for a Minister who deals with the business end of communications. But this bill is really also about the spying part. One thing is that it is about network security, but the fact is that it is about snooping, it is about spying, and that Minister can change—the bill says—“with the authority of the Prime Minister,”.

That is the part that really concerns me because we have already got a problem with the Minister responsible for the GCSB and the Minister in charge of the NZ Security Intelligence Service, and his selection of his director of the Government Communications Security Bureau (GCSB). He has got strong, strong powers in this. There is nothing in this bill that would stop the Prime Minister making himself, or, in future maybe, herself, the Minister of this legislation and the Minister of the GCSB and the SIS and other aspects of that. When we have got the history of the illegal spying, and when we know that these bills do not even cover the large-volume spying that is happening within the range of activity that that Minister covers, then if that Minister were to have control of this as well—full individual control of whom he seeks to employ and did, in terms of the Director of the GCSB, Ian Fletcher—it actually gets into the realm of sinister.

Maybe the Minister for Communications and Information Technology could address that and make the interpretation a little bit more specific in regard to the range of ministerial responsibility. Maybe she can preclude that the Minister responsible for the GCSB and the Minister in charge of the NZ Security Intelligence Service can be the one and same Minister who operates this, just so we can do a little bit of separation. I think it would be a good idea, and it is good to see the Minister there with that capacity. I also say to the Minister in the chair, thanks for the letter to the Green Party. There was an expression that we could meet, but I actually find that a little bit farcical. It is probably a bit rich, seeing you are sitting there and we are face to face. It is not very practical in terms of the speed that this bill is going through. It is going to be after the event, I expect. So the dialogue is probably here and now.

I am always concerned when I see the interpretation of “national security” including economic well-being. Well, of course we want New Zealand and “New Zealand Inc.” to be in a very good economic fitting. We do not want somebody to come in and muck that around, particularly. It is always a concern as to what that definition actually is. What is in that definition? Whose version of economic well-being is it? How far out is it? How sustainable is the well-being we are talking of? Is it intensive dairying and we must protect that at all costs, when we know it has got a big externality? We need to look after some of the MPs in this House and their interests around farming, maybe. And we do—we must look after the family farmers, but we must not have economic well-being measured by something that is temporal and not sustainable at any time.

The interpretation of “network operator” has been brought up already, but that is also quite concerning when we think about what a network operator is. There are some definitions in the bill but they are very broad. They do need to be toned down and made more specific, and someone’s Supplementary Order Paper may address that. But what we have got operating through Parliament, the networks there—I would look to some of my NGO friends and wonder whether Greenpeace’s network within their offices is going to get intercepted. Are Fonterra’s big office and the networks within that and elsewhere part of the same sort of equation? That could be tidied up as well. It was interesting to hear the debate on the issue around the terminal. Is this telephone a terminal device, or does the fact that I can tweet on something that has been said to me make me part of the network? I suppose it is intended to be.

There is a concern as well in this part. There has been some criticism of the Minister’s Supplementary Order Paper 366, and we will probably revisit that. We have got some comment from outside—telecommunications and IT people—about the definitions. One of them is from Catalyst IT’s director, Don Christie, whose concern is that the definition of “network operator” is so broad as to essentially capture anyone in the sector. He said that the bill “creates huge uncertainty and therefore business and investment risk for anyone in the New Zealand ICT industry or considering entering it.” So I am hoping that through the Supplementary Order Papers the Minister sitting there might be able to fine-tune this somewhat.

The Greens, of course, are opposing this bill because of its breadth, because of the purposes and principles here—they are not being addressed properly before we have a full investigation into the surveillance issues or security issues of New Zealand. We have had so many things that have gone wrong—the illegal activities—that we must have a genuinely independent investigation, and then come back and address this bill. I am looking forward to that sometime in the future. We have in clause 5 of the bill the purposes relating to interception capability to ensure that the “agencies are able to effectively carry out the lawful interception …”. Well, that is about the lawful part, and it does concern me that it may actually need to be spelt out a little for this Government and the GCSB as to what certain activities are not lawful, because we have got other parts around the world, other countries like Brazil, which are just setting up their own new networks, new systems, to find a way to actually avoid the likes of Waihopai and the National Security Agency of the United States, which was actually spying on it. Brazil found that it was being spied on. It is not impressed.

The CHAIRPERSON (Lindsay Tisch): Order! No, you can carry on, but we are on Part 1.

STEFFAN BROWNING: This is around the purposes of the legislation relating to interception capability. I think that New Zealand, with a full investigation into the purposes and the principles relating to interception capability, might want to follow what Brazil has done, in terms of doing something that is absolutely independent and looking at network security for itself that will stop the likes of what we appear to be allowing to be set up through this bill. I will speak to this a little bit further as we go through the rest of the parts. Thank you.

IAN McKELVIE (National—Rangitīkei): I move, That the question be now put.

Dr DAVID CLARK (Labour—Dunedin North): Part 1 of the Telecommunications (Interception Capability and Security) Bill really covers such a wide range of things because it speaks to the purposes and principles of the bill. As we have heard in the debate so far, there have been many, many different aspects of it that have been called into question. It is a piece of sloppy, permissive legislation that allows surveillance, seemingly endlessly and without clear definition, across many aspects of our society. I think that that is what many of the objections so far have pertained to.

I want to spend some time speaking about Supplementary Order Paper 370, which Clare Curran has lodged, because I think it speaks directly to some of these problems. In that Supplementary Order Paper the suggestion is that we delete the definition of “national security” as it appears in clause 3 of the bill. That is a sensible thing to do because the definition as it stands refers only to economic well-being. Economic well-being itself is not defined in clause 3. We learnt from those members who were on the Law and Order Committee that, in fact, in the select committee no real effort was made to take into consideration what economic impact this bill will have. There were supplementary submissions to the select committee by several network operators that outlined potential significant annual operating costs and potential capital expenditure costs associated with implementing this bill.

Clare Curran: $50 million.

Dr DAVID CLARK: One estimate was $50 million, I am told by Clare Curran, who sat on that committee and who has made important contributions on this bill so far. The fact that the committee did not seek advice on these supplementary submissions suggests that we do not have a mature view as to what the economic impact is that we are taking into account. I think that that is something that this Committee might like to reflect on seriously.

I would be interested in the Minister for Communications and Information Technology’s thoughts on what that economic impact would be intended to be, and I think other members of this Committee would be, too, because we have a serious problem here. If the only definition of national security that we have in the bill is that it takes economic well-being into account—and we do not know what that economic well-being is, and nor have we have defined it particularly well in the debates in this House—that opens up the Government to litigation. I think that that is not good lawmaking. I think that that needs further clarification, or, as Clare Curran suggests, that term—the definition of what national security is—should be removed from the whole clause. Currently it is redundant, it is confusing, and it is perhaps misleading at best. In the legislation it tends to suggest that there is an economic impact to be taken into account, but we have no definition of what that might be.

Amending the definition of “network provider” is also a provision that Clare Curran has in her Supplementary Order Paper. The bill as drafted places onerous obligations on the network operators. We have heard a number of members of the Committee comment on those who might be captured by it, such as TradeMe. Trevor Mallard was wondering whether his mobile telephone would be captured in that definition, whether it is a terminal device when it can forward on information, and whether, indeed, it is part of a network. We heard questions about whether schools are parts of networks and whether they are then open to surveillance when they set up internal networks, and about newspaper websites, TradeMe, and the like. In Clare Curran’s Supplementary Order Paper she suggests that clause 3 should be amended to make it clear that such things are not captured and, as best as you can, not captured in the legislation. I think that that is a very sensible step.

Amending the definition of “service provider” is another amendment put forward in the Supplementary Order Paper that Clare Curran has put before the Committee. It tries to make sure that this bill will be applicable in international law. We have a serious problem with this bill where it is not clear that the efforts made in it to define things can, in fact, be implemented internationally. It is not a good thing for the Parliament of New Zealand if we are in a position of passing legislation that is going to open us up to international ridicule and to scuffles and fights in the international sphere.

Moana Mackey: It already has.

Dr DAVID CLARK: My colleague makes it clear that, in fact, it already is opening us up to some level of ridicule, but I think it would be far more serious if we were to pass legislation that put into law this kind of anomaly, this lack of clarity, and, in fact, the definitions that we currently have.

The next part in clause 3 that calls for amendment is inserting a new definition of “surveillance agency”. It is clear that—

JACINDA ARDERN (Labour): I appreciate the opportunity to take a short call. My colleagues will be pleased to know that; I know they are all eager to speak on the Telecommunications (Interception Capability and Security) Bill.

I was interested in talking about some of the definition issues that have not been touched on yet. I think it is fair to say that this does deserve rigorous debate, because although there was an enormous amount of attention on the Government Communications Security Bureau (GCSB) bill, this is, in fact, the bill that then facilitates what was broadly set out in the GCSB bill, which did, of course, cause great upset amongst the wider New Zealand public over whether or not it had got the right balance between privacy and security. We would contend that certainly this bill in this form has still not struck that balance.

I want first of all to come to the definition around “law enforcement agency”. That is set out in clause 3 of Part 1. This is obviously something that the Law and Order Committee took an interest in. As I understand it, the clause originally had a definition that specifically set out that “law enforcement agency” meant “(a) the New Zealand Police; or (b) any government department declared by the Governor-General by Order in Council to be a law enforcement agency for the purposes of this Act”. So the bill basically said that everything that applied here would be handed over to the Minister to decide what the law enforcement agencies would be.

That was then changed. We now have a clause that states “a specified law enforcement agency within the meaning of section 50 of the Search and Surveillance Act 2012 that is approved by an Order in Council under that section to use interception devices”. I do accept that that therefore adds extra criteria. So instead of just saying that the Governor-General through an Order in Council sets up what a law enforcement agency is, it says we will use the provisions of the Search and Surveillance Act to determine the criteria for what will be deemed a law enforcement agency.

I want to look just for a moment, if I may, at what is set out in section 50 of the Search and Surveillance Act 2012. It basically says: “Look, other than the police, when we are applying trespass surveillance and the use of interception devices, how are we determining what that is going to be?”. It essentially says that the Minister of Justice may recommend the making of an Order in Council. So, just to clarify, I am assuming that—was that changing which Minister would therefore be making that recommendation, from the Minister in the chair to the Minister of Justice? That is just a point of clarification. Excuse me; I was not a member of the select committee, and that may be something that the committee debated. But the Minister of Justice would therefore be making the recommendation of an Order in Council “following consultation with the Minister of Police, if he or she is satisfied that it is appropriate for the agency to use interception devices, and that the agency has—(a) the technical capability to intercept private communications in a manner that ensures the reliability of any information obtained through the use of an interception device;”. So, basically, can the agency do the job, and can we be assured that when it gets that information, that is going to be credible?

The Act then says: “(b) policies and procedures in place to ensure that the integrity of any information obtained through the use of an interception device is preserved;”. So, write up some policies and make sure you have got some good kit—that is basically what that bit says. The Act then says: “and (c) the expertise—(i) to extract evidential material from information obtained through the use of an interception device in a form that can be used in a criminal proceeding; and (ii) to ensure that any evidential material obtained through the use of an interception device is presented to the court in an appropriate manner,”.

So, basically, that is about setting the bar for the quality of the way that the material is gathered and the way it is therefore presented, and about making sure you have got policies and procedures around that. Granted, that is criteria that in and of itself did not necessarily exist in the first definition of “law enforcement agency” that might be recommended via Order in Council. The question is whether that is a hard test. Basically, if you have got the kit, if you write some policy around it, and if you make sure that you use the kit credibly, then you are passing the threshold, and as long as the Minister of Justice and the Minister of Police have a chat together and decide that they think that it is kosher, then we have potentially got a new law enforcement agency on the books.

You might question who would be interested in using these powers as a law enforcement agency. An interesting and very important discussion was had, in fact, at the Justice and Electoral Committee—I was on the select committee for the Search and Surveillance Bill, a very technical bill. There were, essentially, two sets of agencies there that could exercise powers.

KRIS FAAFOI (Labour—Mana): Thank you very much, Mr Chair, for the chance to have a contribution to the debate on Part 1 of the Telecommunications (Interception Capability and Security) Bill. In an effort to try to garner some kind of favour with you to get a second call, I am just going to outline what I intend to talk about. I know that my colleagues have spoken about the “network operator” and the definition of that. I certainly will try to touch on that, and also something that Dr David Clark mentioned—

Hon Clayton Cosgrove: A great man.

KRIS FAAFOI: —a very good man—and that is the definition of “surveillance agency”.

I did want to start with the definition of “network operator”. A number of my colleagues have spoken about the very broad nature of the definition as it stands within the bill. For the benefit of those who are listening or watching at home, a network operator under this bill is “(a) a person who owns, controls, or operates a public telecommunications network; or (b) a person who supplies (whether by wholesale or retail) another person with the capability to provide a telecommunications service”. A little bit further on in Part 1, it does go on to define “telecommunications service” as having the meaning given to it under section 5 of the Telecommunications Act.

Mr Chair, I want to—because I want to stay very much on the bill and not be sidetracked by other issues—read to you what a telecommunication, under the Telecommunications Act 2001, is defined as. The term “telecommunication” means “the conveyance by electromagnetic means from one device to another of any encrypted or non-encrypted sign, signal, impulse, writing, image, sound, instruction, information, or intelligence of any nature, whether for the information of any person using the device or not;”. Essentially, that puts within the legislation anything you do with any electronic device—it comes under this legislation. So if you run an internet website at all, you will be included within this bill, the Telecommunications (Interception Capability and Security) Bill.

A number of my colleagues have mentioned whether or not the likes of Stuff or the New Zealand Herald website would be considered a network operator. Within the definition of “telecommunication” within the 2001 Act, that certainly seems the case. Trevor Mallard—he is absent; sorry, he is not with us at the moment—mentioned the instance of a school in Auckland and whether it would be considered a network operator. But we on this side of the Chamber put forward that anyone running any kind of internet service—whether it be the likes of Stuff or the New Zealand Herald website, or whether it be Facebook or whether it be Skype—any communication, and any type of electronic communication that any Kiwi makes can now be intercepted by this bill. That goes to the very heart of the major concern you saw on the streets of New Zealand about 2 months ago, when thousands, if not tens of thousands, of Kiwis who were very concerned about the likes of the definition of a network operator within this bill, the Telecommunications (Interception Capability and Security) Bill, and the Government Communications Security Bureau (GCSB) legislation, which is the cousin or very close cousin—

Moana Mackey: Companion.

KRIS FAAFOI: —the companion bill—to this piece of legislation, and what this meant for their everyday communication. I want to go back to the definition of “telecommunication” within the 2001 Act. It says “the conveyance by electromagnetic means from one device to another of any encrypted or non-encrypted sign, signal, impulse, writing, image, sound, instruction, information, or intelligence of any nature,”. So that means anything, whether it be a text message or whether you Skype someone on the other side of the world. This legislation gives the ability to the GCSB or pretty much any other surveillance agency—

Clare Curran: Without checks or balances.

KRIS FAAFOI: —with no checks or balances—to intercept them. Anything that they want to do with any electronic communications can be intercepted. We have major concerns about that, and we do not think that the balance is right, especially around some of the New Zealand Bill of Rights Act applications around this bill and the GCSB legislation.

Can I move on to another piece of Part 1, and that is around the definition of “surveillance agency”. As it stands in this piece of legislation at the moment, “surveillance agency” means “(a) a law enforcement agency; or (b) an intelligence and security agency”. There were major concerns on this side of the House around this at the Law and Order Committee, so my colleague Clare Curran has helpfully put forward Supplementary Order Paper 370, which will look to replace the definition of “surveillance agency” as it stands now.

MARK MITCHELL (National—Rodney): I move, That the question be now put.

BRENDAN HORAN (Independent): In taking a first call on Part 1 of the Telecommunications (Interception Capability and Security) Bill, I want to look at clauses 3 to 8 of the bill. I understand that the debate is quite tight and that we are looking at the definitions in clause 3, the purpose and principles relating to network security, and interception capability in clauses 5 to 8. I have to say that I am unable to support the bill and unable to support Part 1 for the reasons that I will outline.

I will start with clause 4. The heading of four words says “Act binds the Crown”. The clause itself adds only one word—“this”—to read “This Act binds the Crown.” Surely the purpose and principles of this bill cannot be for John Key to have his own private fiefdom, effectively, with New Zealand spies subject to no oversight, no constraint, and no law.

In clauses 5 and 6, which relate to the purpose of the Act in relation to interception capability and the principles that must be applied in relation to capability, it is apparent that the spy agency must be allowed to intercept anything, anywhere, at any time. That is a clear threat to New Zealand’s economic well-being and our future opportunities. The very legislation that members opposite would have us believe would protect our law-abiding citizens is, in fact, entirely the opposite.

Prior to the release of this bill there was a salivating opportunity for New Zealand to take advantage of our position, to take advantage of our isolation, and, in fact, possibly to become the information-holding capital of the world. We could have held and reinvented economic systems. Take accounting systems, which are currently all designed in analogue. With the relevancy, the intimacy, the convenience, and the transparency that big data and the cloud represent, the future was, indeed, looking bright. Thousands—in fact, tens of thousands—of jobs were possible, but not given the way that clauses 5 and 6 are written. According to the Ministry of Business, Innovation and Employment, the New Zealand information technology and services sector employs just over 22,000 people and has a growth rate of 8.7 percent annually. Salaries are double the national average, and research and development investment is triple the New Zealand average.

With clauses 5 and 6 in this bill, this National Government threatens jobs, innovation, and the future of the cloud in New Zealand. We are moving into an era where we will soon all have our own personal cloud. How do we protect intellectual property from the spy agencies that will have unlimited interception capabilities under clauses 5 and 6? Who will be communicating, cooperating, and collaborating with significant others across the world on matters of innovation when that information can be stripped by the Government Communications Security Bureau and immediately shared with agencies from other countries? How can it be that New Zealand companies will now have to design networks and systems for the convenience of the Government’s spy agency? How can we compete with the rest of the world when this Government is imposing that sort of Cold War, Russian-style oppressive legislation? Who oversees it? What people and what businesses would want to dock, deliver, or deploy innovative information to a New Zealander under the degree of surveillance that this bill allows?

This bill is madness, and the sad thing is that it all could have been avoided if the Government had consulted with the broad sector of New Zealand information technology businesses, the sector that could deliver our economic future, rather than with just the one-dimensional telecommunications companies. The purpose and principles of this bill should have been inspiring, but, instead, given the increasing reliance of businesses on software and services, this bill will have a disastrous effect on New Zealand companies that provide internet-enabled technologies and services.

So to this Government, on behalf of all New Zealanders, I plead: please do not rush to pass this legislation, which casts a dark cloud over our digital sector’s future. Instead, provide New Zealand with a bill that inspires confidence and investment. The job of this Government—

MOANA MACKEY (Labour): I want to pick up on the issue that my colleague Kris Faafoi was talking about at the end of his call, which is the definition of “surveillance agency”. I would very much like it if the Minister in the chair, the Minister for Communications and Information Technology, would take a call, because Part 1 is incredibly important. These are the definitions that define who is covered by the Telecommunications (Interception Capability and Security) Bill, when they are covered by it, how they are covered by it, and when they are not covered by it. So if we do not get the definitions right, then the rest of the bill is not going to be much use. Given that the whole reason we are here debating Part 1 of the bill is that our surveillance and security agencies could not interpret the previous legislation according to the law, I think it is even more important that we are very clear around the definitions that we are putting in place in Part 1 of this piece of legislation. What has become clear from the debate here in the Chamber today is that there is no clarity around these definitions. That echoes what submitters said at the Law and Order Committee.

So what we would like is for the Minister to do her job, which is to provide that clarity. She is sitting there like a dried arrangement. I do not know whether she is giving us her impersonation of a terminal device—all the data just stops with her and no more information is passed on whatsoever—but she should get on her feet and provide the kind of certainty that we are asking for. These are not unreasonable questions that members on this side of the Chamber are requesting of her, especially when we consider how far-reaching the implications of this bill are. The balance between privacy and security is one of the most sensitive issues we will ever cover off. So any clarity the Minister can provide around the definitions of “network operator” and “surveillance agency” can only be good for this legislation.

I am not quite sure why she is not taking a call. She has got an army of advisers behind her to provide her with that clarity—unless she wants this to be uncertain, unless she wants this to actually be far broader in its interpretation than New Zealanders are comfortable with and than we were led to believe this legislation would be, unless she is happy with that uncertainty because that allows the broad powers in this bill to be extended even further. If she refuses to take a call and provide us with that certainty, then that is really all that we can assume, unfortunately.

My question to the Minister is whether this definition of “surveillance agency”, which is “(a) a law enforcement agency; or (b) an intelligence and security agency” applies only to New Zealand agencies or whether it applies to any agency internationally—to any law enforcement agency or intelligence and security agency. Minister, are the people who can access this data restricted only to New Zealand law enforcement agencies and New Zealand intelligence and security agencies, or could they be any law enforcement agency or intelligence and security agency internationally? Is it just New Zealand?

It really, really worries me that she has acknowledged my question but has not given me an answer. That is really serious. Because if it applies just to New Zealand, I think people would like to hear the Minister say that, so that we can limit this bill to New Zealand law enforcement agencies and New Zealand intelligence and security agencies.

Clare Curran: I think we know the answer.

MOANA MACKEY: I think we know the answer, which is that this opens us up—the privacy around the information of New Zealand citizens is opened up to any law enforcement agency or any intelligence and security agency around the world. I am looking at the National MPs over here. Are you really comfortable with that? Are they really comfortable?

Clare Curran: They didn’t know.

MOANA MACKEY: Did they even know that this goes international in its broad-ranging powers? [Interruption] The Minister says it is rubbish. She should stand up and provide some certainty. Does she not think this is an important enough issue to stand up and provide some certainty over it?

This is going to form the basis of a lot of the rest of the debate on the protections around that, and the limitations around that. She might think it is funny, but actually it is deadly, deadly serious—it is deadly, deadly serious. Given how we got into this mess in the first place, given that this is around one of the most sensitive issues, and given that New Zealanders feel incredibly strongly about this, I think we deserve to know whether the broad powers being given to the intelligence and security agencies now actually apply to every law enforcement and intelligence and security agency around the world, not just those based here in New Zealand. I look forward to the Minister taking a call on that. I think that is actually a really critical point. She can chip away at me from the chair, but she should stand up and actually take a call. That is what she is paid to do. That is actually what the Committee of the whole House stage is meant for.

I want to come back to Supplementary Order Paper 370, in the name of my colleague Clare Curran. This is in relation to the commencement clause of the bill, which is clause 2 of the bill. [Bell rung]

The CHAIRPERSON (Lindsay Tisch): I am calling Moana Mackey.

Iain Lees-Galloway: Asleep at the wheel, Nicky.

MOANA MACKEY: It is because they are so worried about the definition of “surveillance agency”. They were pondering it. They want to know as well. They were hoping that the Minister was going to take a call and reassure her own colleagues that she is not selling away New Zealanders’ right to privacy to every law enforcement agency and intelligence and security agency around the world, and they are right to be concerned.

I come back to the commencement clause and the Supplementary Order Paper in the name of my colleague Clare Curran. It makes two changes. The first change is that it inserts a requirement that the bill may not be assented to without first holding an independent review of New Zealand’s security agencies and incorporating those recommendations into the bill prior to the third reading. This is sensible. This is sensible, given the process we have gone through with this bill, and given the fact that we have a Minister who refuses to provide any answers to the very, very serious questions we are posing to her. The only way we are going to be able to provide any kind of comfort to the hundreds of thousands of New Zealanders who are deeply, deeply concerned about this piece of legislation is to actually do a proper review of our intelligence and security agencies and find out what the issues actually are. What a novel idea—that when we try to fix a problem we might work out what the problem actually is before we do that.

I know from the conversations that I have had with people that they saw an intelligence and security agency that went far outside its mandate under the law, broke the law, and acted illegally. Most New Zealanders would say that if you were going to have a knee-jerk reaction to that, it would be to restrict their powers. Lo and behold, we ended up with two pieces of legislation that broadly expand their powers, to the point where the Minister in the chair will not even guarantee—actually she pretty much told us—that these powers do now go offshore and that every surveillance agency and law enforcement agency around the world is now able to have access to the private data of New Zealand citizens. That is serious stuff. That is not the kind of response I think New Zealanders expected following the illegal activities of the Government Communications Security Bureau.

So how about we pass the recommendation in the Supplementary Order Paper from Clare Curran, have that inquiry, and find out what actually went wrong, find out what actually needs to change in law, and find out how we can get that very critical balance between privacy and security right? In the telecommunications age, when we are dealing with streams of information that we have never had to consider before when we originally had legislation around these issues, how about we actually do it properly? What a novel idea. That is what the Supplementary Order Paper in the name of my colleague Clare Curran says that we should do—that there will not be any Royal assent to this bill until we have that inquiry, and the changes recommended through that inquiry are then incorporated into this piece of legislation.

The second suggestion or amendment that Clare Curran is putting up to the commencement clause is requiring that the bill be reconsidered by a select committee and found to be consistent with the New Zealand Bill of Rights Act 1990 before it can be submitted for Royal assent. This is a bill that was substantially changed at the Law and Order Committee. The Minister herself is introducing the extensive Supplementary Order Paper 366. Once again we have a regulatory impact statement that is hugely redacted. Did anyone even really use that word “redacted” before the National Government? I do not think so. I think most people had never—

Grant Robertson: It’s like liquefaction; it’s a new word.

MOANA MACKEY: It is a new word. Thanks to this Government, “redacted” is so commonly used now, because in the regulatory impact statements that are meant to inform—

Dr David Clark: Have a look at this page. See what you can find on there.

MOANA MACKEY: This is great. This is the kind of information that the National Government is asking this Parliament to make its decisions on. This is a regulatory impact statement on this piece of legislation, which we are very interested in, and this is what the National Government is allowing the Parliament to consider when it passes this bill. It is a completely redacted page, just like many of the other regulatory impact statements we have had from the Government. We are used to it from the National Government, but when you are considering the implications of this bill it is not appropriate at all that we are not given the relevant information to make those decisions.

So Supplementary Order Paper 370 in the name of my colleague Clare Curran amends clause 2 to say that this should go back to a select committee, we should have that discussion, and we should get clarification that we are not breaching the New Zealand Bill of Rights Act, and only then can it come back and be submitted for the Royal assent. That is just practical. That is good, common-sense lawmaking. I know that the National Party does not really give due regard to the New Zealand Bill of Rights Act, or, clearly, the right of New Zealand citizens to privacy, but on this side of the Chamber we actually value good process. We actually value that process of a proper New Zealand Bill of Rights Act vet. As my colleague Clare Curran said, it got a cursory vet at the very beginning. It has been substantially changed.

GRANT ROBERTSON (Labour—Wellington Central): I seek leave of the Committee to table a letter from the NZRise group of companies that is relevant to Part 1 of the Telecommunications (Interception Capability and Security) Bill around the definition of “network operator”.

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

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

NICKY WAGNER (National—Christchurch Central): I move, That the question be now put.

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

Ayes 64

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

Noes 54

New Zealand Labour 33; Green Party 12; New Zealand First 7; Mana 1; Independent: Horan.

Motion agreed to.

The question was put that the amendments set out on Supplementary Order Paper 366 in the name of the Hon Amy Adams to Part 1 be agreed to.

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

Ayes 61

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

Noes 57

New Zealand Labour 33; Green Party 12; New Zealand First 7; Māori Party 3; Mana 1; Independent: Horan.

Amendments agreed to.

The question was put that the amendments set out on Supplementary Order Paper 370 in the name of Clare Curran to clause 3 be agreed to.

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

Ayes 54

New Zealand Labour 33; Green Party 12; New Zealand First 7; Mana 1; Independent: Horan.

Noes 64

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

Amendments not agreed to.

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

Ayes 61

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

Noes 57

New Zealand Labour 33; Green Party 12; New Zealand First 7; Māori Party 3; Mana 1; Independent: Horan.

Part 1 as amended agreed to.

Sitting suspended from 6.04 p.m. to 7.30 p.m.

Part 2 Interception capability duties

CLARE CURRAN (Labour—Dunedin South): This is Part 2 of the Telecommunications (Interception Capability and Security) Bill. We are in the Committee stage of the bill and we are now talking about Part 2. This is the part of the bill that I would describe as being the “tying itself up in knots” part. This is the part of the bill where, essentially, the discussion that was happening in Part 1 takes effect around how those definitions play out, particularly with regard to the service providers.

The service providers, for the sake of anybody listening in, are the organisations and companies that are becoming more and more prevalent in our lives, otherwise known as the over-the-top providers, such as the Facebooks, the Googles, the Microsofts, and other such entities. They are mainly entities that have a base in another country, rather than in our own country. These are the big organisations that are enabling us to communicate in all kinds of different ways. How the provisions of this bill relate to those service providers is very important. As we discussed in the debate on the previous part of the bill, the definition of “service provider” is so broad and so encompassing that it does provide a potential conflict with international law, how this generally plays out, and the service providers’ ability to provide what is called the “duty to assist” our surveillance agencies.

I just want to put on the record that although Labour is opposed to this bill in its entirety, we are not at all opposed to the modernisation of the legislation. We are not opposed to the provisions that existed in the previous legislation that put a duty to assist on organisations—a duty to assist the surveillance authorities when there was cause to do so. The problem that we have with this part of the bill—well, there are several problems.

I think that clause 35 is probably the most significant part of Part 2 of the bill. It gives a deem-in provision to the Minister in the chair at the moment, the Minister for Communications and Information Technology, and extraordinary, unheard-of powers that we have not seen in this country before, where a Minister gets to have, for whatever reason, the power to decide whether a service provider can be deemed in to become a network operator. A service provider, just so that everybody knows, has to have a duty to assist. That is fair enough. There is no issue with that. But the ability to deem in that service provider—such as Google, such as Microsoft, such as Facebook—to become a network operator would mean that it would then come under the provisions in Part 3, which are much, much stronger. That then means that it becomes, essentially, an organisation that our surveillance agencies can have an enormous amount of power over. The conflict in law is actually really important.

Again, just so that everybody knows, in her last-minute Supplementary Order Paper 366, which was brought before the Committee, the Minister deleted clause 39, which is in Part 2—the reseller clause. That will have some beneficial effect, I suppose, for some of our internal telecommunications organisations. There will be a bit more of a fair playing field for them when it comes to making their products available to the New Zealand public and the onerous conditions that could have been put on them through this bill.

We are very dubious about the assurances that have been given by officials during the passage of this bill through the Law and Order Committee that the Telecommunications (Interception Capability and Security) Bill could require non - New Zealand service providers to provide access to customer data to the New Zealand Government. That is at odds with the providers’ own domestic legal obligations. The point that is being made here and that certainly has been made very publicly in the last week by these organisations—and, you know, this is not about getting in behind them and thinking that they are wonderful—is why is it that there should be a piece of legislation going through this Parliament when there is a question mark over whether it is in direct conflict with international law? That is just simply not good enough. The warnings were given. The submissions were made. They were made very powerfully, but for some reason they have been ignored.

Secondly, for this part of the bill—and I know there will be more discussion by my colleagues around this, and this goes directly to the amendment in Labour’s Supplementary Order Paper 370—after clause 35, Labour has put forward an amendment that creates a technical advisory board, which is a check and balance. That is the other major issue with this bill—again, there are many—there are no checks and balances. When we are talking about privacy, we are talking about the rights of citizens, and not just citizens but companies and their ability to innovate, their ability to control their own destinies, and their ability to go about their business in a context where security for the country, for the bigger-picture interest, is brought into balance. Unfortunately, that balance has been tipped. One of the problems is that we do not have enough checks and balances in this law.

We contend that there should be a technical advisory board established, as was recommended by many of the submitters. The submitters included the Telecommunications Carrier Forum, the peak body group for all of the major telecommunications companies in New Zealand. The forum said that there needed to be a technical advisory board, such as there is under legislation in the UK, which is, essentially, a panel that is set up to provide advice. It provides advice before decisions are made by the Minister on whether or not there should be interception undertaken, and it should have an independent chair.

As I said in the second reading debate on this bill, New Zealand is a small, stable, peaceful democracy. We take really seriously in this country what those principles actually mean and how they are reflected in law and in regulation. This piece of legislation before us today tips that balance. It tips the balance in favour of State surveillance and secrecy without checks and balances.

I would like to hear directly from the Minister, who still has not got to her feet yet in this debate. She still has not got to her feet—

Grant Robertson: An hour and a half, she’s had.

CLARE CURRAN: —after the 2 hours, pretty much, that we have been here. She still has not got to her feet. One of the reasons why is that she—I am starting to ask myself whether she just does not understand the legislation that is before her, does not understand the impact of it, has not listened to the community, and has not listened to the industry. Certainly she is not taking any heed of what the implications are of her Draconian piece of legislation, which is before us today. She shakes her head. Unfortunately, I have come to the conclusion that she actually does not understand it, because otherwise we would actually be hearing from her as to what the implications are. Why is it that a technical advisory board could not be put in as a check and balance to provide the public with an assurance?

GRANT ROBERTSON (Labour—Wellington Central): I am sure my colleague Clare Curran will continue with her contribution on this bill, the Telecommunications (Interception Capability and Security) Bill, in a further call on this part. Part 2 is the interception capability part of the bill. As Clare Curran has said, this is really where the balance between protecting New Zealanders’ security and protecting New Zealanders’ rights and freedoms to communicate with one another has to be put into balance. As Clare Curran has also already said, in the earlier legislation that this bill amends that balance was already put there. There was an acknowledgment that network providers, or network operators as they are now defined here, would have roles and responsibilities around allowing for an interception capability.

No matter what we might like to think about the world, there are people out there who may well be wanting to do things involving cyber networks in New Zealand that are against the law and put New Zealanders in danger, and therefore that capability is something that we, on this side of the House, accept. What we do not accept is allowing that capability to be opened up to such an extent that an enormous power now rests in the hands of the Minister of Communications and Information Technology around where that capability is used, on what networks, and what obligations are now on the providers of those networks.

Again, this is not just about Opposition politics. This is not about just getting up and saying: “This is a Government bill. We oppose it.” The Law and Order Committee heard submission after submission from those who are directly involved in the provision of internet services and the provision of networks in New Zealand that this part of the bill would have the effect of stifling innovation, potentially reducing investment in New Zealand by large telecommunication companies and by the over-the-top providers that Clare Curran mentioned before, and that overall it would extend out the powers of the Minister in such a way that that necessary balance between protecting our security and the freedoms of New Zealanders would go out of balance.

At the select committee, Microsoft came and said: “An obligation to have interception capability on a fundamentally different technology to what we have seen in the past in our view needs to be considered on its merits, not swept up in broad legislation that gives wide powers to surveillance agencies and Ministers.” That is the point. It is not that Microsoft is saying it should not have any interception capability requirements upon it, but that they should not be part of legislation like this, which is loose, poorly defined, and associated with a massive expansion in the powers of the surveillance agencies, in this case the Government Communications Security Bureau (GCSB) through the Government Communications Security Bureau Act and through an expansion of the powers of the Ministers. Microsoft has come along and it has said that. It has also said—and this comes to clause 39, which we can still debate because it is actually in the Minister’s Supplementary Order Paper 366, which we will vote on later on. She has decided to delete clause 39 after a massive backlash from across the telecommunications industry. But the signal sent from the Minister with clause 39 was that New Zealand was trying to, in some way or other, shut itself off from the rest of the world and actually cut off the possibility of innovation within the information and communications technology sector in New Zealand.

It is interesting to note—and I am reading a column from the National Business Review about the burden that New Zealand - based businesses will face. It is one thing for the Microsofts, the Googles, and the Apples of this world to come and say they do not like the burden that this bill is going to place upon them—and they have a legitimate claim there—but what about New Zealand providers? What about those who are the providers of, for instance, cloud services, where New Zealand actually has a very good reputation—

Clare Curran: Had.

GRANT ROBERTSON: Had? Well, yes, indeed. It had a very good reputation in terms of the development of innovative cloud technology. Well, what has been said by those who provide that is that this actually, over time, will put huge costs on those providers and essentially make them weaker in comparison with the international cloud service providers.

Here we have the National Government, supposedly the friend of business, bringing to the House a piece of legislation that is actually going to stifle innovation. It is potentially going to shut off interest internationally, but it is actually going to stifle innovation from New Zealand companies. New Zealand businesses, which will have to be able to put their services up against this law and ask whether they have the capability the New Zealand Government wants, will simply walk away, in my view, when they see this kind of approach from the Minister. If we look at it both from the terms of those companies from overseas and companies from New Zealand, the powers that are in Part 2 of this bill around interception capability, quite simply, put a great deal of extra cost on those companies and potentially stifle the innovation that they will be part of.

In Part 2, how does this come about? Well, there is a range of ways that Part 2 does this. But, essentially, the area that I want to focus this part of my contribution on is around clause 35 of the bill—and this is the part of the bill where Clare Curran has an amendment to establish a technical advisory board—because what we see here is the classic expansion of ministerial power. Again, from a National Party supposedly all about reducing government and reducing the impact of the State, we now have enormously expanded powers. Subpart 5 “Ministerial directions”, states: “Minister may require service providers to have same obligations as network operators”.

Clare Curran: Unprecedented.

GRANT ROBERTSON: Clause 35, 36, and 37 go through the way in which the Minister will do that. Everything is in the control of the Minister. There is a review provision put in here under clause 36, but it is totally within the control of the Minister. The expansion of powers alongside the complete control of the Minister is, as my colleague Clare Curran interjected before, unprecedented.

This legislation is loose, it is poorly defined, and it breaks new ground. That combination is something that all New Zealanders should be very, very concerned about. That is why, under Supplementary Order Paper 370, we are looking to establish a technical advisory board. This technical advisory board would at least have the ability to be somewhat independent from the Minister. In Supplementary Order Paper 370, which Clare Curran has put forward, the Minister appoints members of the technical advisory board only after consulting with representatives from the telecommunications industry. It needs to comprise equal representation from Government and the industry, with an independent chair. Any matter referred to the Minister requesting they exercise their discretion or recommend providing an additional area of specified security interest must first be referred to the technical advisory board, and it has to be established with the purpose of increasing expertise in relation to network security and consideration of proposed mitigations.

At least if we have this in the law we can have some reassurance that the Minister’s increased powers will not be abused. The industry wants this. It has come to the select committee and said: “Can we have something like this?”, and the Government has ignored it. Consistently, throughout the process of this bill, the Government has ignored the warnings of industry—ignored the warnings of the very people who provide these services to New Zealanders. It is not like they are being unreasonable. As late as the last couple of weeks, telecommunication groups have been writing to the Minister saying: “Please can we meet with you to talk about how we can mitigate some of the problems we see in here?”. They are not walking away. They are not saying they do not want to be a part of a regime in New Zealand that provides that balance of security, and the Minister will not talk to them. The Minister will not talk to them. The Minister puts up some tweaks in her Supplementary Order Paper. She gets rid of the clause that is causing her the most grief, but in reality that does not change the fact that this bill breaks new ground and is unprecedented in the level of power it gives to the Minister and the expansion of powers it creates for the surveillance agencies.

Yet here we are, the day after the second reading, with the Government trying to shove this bill through. All through this week it has been trying to get it out of the way. Well, that is simply not the way to make good law. This is an area that is technical. It is difficult. It is in an area of technology that a lot of people do not fully understand. It is exactly the kind of law where there should be time taken, where we should be able to get buy-in from industry, and in Part 2, on interception capability, the industry is crying out to be listened to and to say: “Yes, we will take on our responsibilities to allow for interception capability, but not at any cost and not with wide open powers for the Minister to do just as she pleases.”

We would call on all members of the Committee to support Supplementary Order Paper 370, which inserts into clause 35 the provision for a technical advisory board. At least that will give New Zealanders some assurance that there will be an independent overview of the Minister’s powers. The Minister has seen fit to take out clause 39. Now is the time for the Minister to accept that there need to be some limits based on the powers. This is what industry wants from this bill. It is time that the so-called business friendly National Government actually gets off its chuff and does something to support industry.

Hon AMY ADAMS (Minister for Communications and Information Technology): I am very happy to take a call on the Telecommunications (Interception Capability and Security) Bill. I have been waiting all evening for something to come up in debate that was worth responding to and was not more of the misinformation, the scaremongering, and the beat-up rhetoric that we have heard from Opposition parties all through this debate. I have waited and I have waited, and we have not heard anything—to the point where I had to wonder whether we were in here debating the same bill—because almost all of what I have heard is simply not correct.

Let us run through what this part of the bill actually does. For a start, this part of the bill, Part 2, deals with interception capabilities. What it does is it rewrites and replaces the 2004 law put in place by the Labour Government. I was very pleased to hear the member Clare Curran say that she has no problem with any of the provisions in the current law. That is great, because the provisions that Labour members spent an hour and a half before dinner complaining about are ones that are copied directly from the 2004 Act. Given that Labour members have just said they have no problem with—

Grant Robertson: No, they’re not. That’s not right. The definitions have changed.

Hon AMY ADAMS: Look back at the Hansard, Mr Robertson. Look back at the Hansard. Read the bill. The definitions of network operators, telecommunications servers, and public telecommunications networks are word for word what Labour wrote in 2004. None of that has changed. The duty to assist on service providers has not changed. The fact that it applies to overseas service providers has not changed. The encryption requirements have not changed. The privacy protections—and we have heard ad nauseam from Labour that somehow this bill is going to destroy the privacy protections—have not changed. In fact, we worked very hard with the Privacy Commissioner on putting this bill together, to the point where she indicated that she was very happy with it. So for all the rhetoric, for all the scaremongering, we have a Privacy Commissioner who confirmed that the bill worked well, privacy protections that are carried over from 2004, and definitions that are carried over from 2004.

If parties want to know whether they are covered under the obligation of being network operators, there is a very simple test—a very simple test. The test is that if they were not a network operator for the last 9 years under the provision that Labour has just told us it was very happy with, then they are not one now. The definition is the same. Nothing has changed. If members have read the bill they will know that.

So let us talk about the effect on service providers, because, again, we have had all of this rhetoric—some of it quite misinformed—about how it applies to service providers in this section. What happens is that at the moment if you provide a telecommunications service in New Zealand, you are subject to our law. Frankly, my view is that if you are providing telecommunications services to New Zealanders, you should be subject to our law, no matter where you are residing. Is it Labour’s position that New Zealand companies should be bound, but that anyone else should get off scot-free? Well, that is not my position. They have always been bound in New Zealand, and they will continue to be. The concern about conflict of laws in my view was never an issue, and that is very clear under common law. Recognising that there was a concern, we have made it clear through Supplementary Order Paper 366 that there is an absolute defence if there is a conflict of laws issue arising in our duty to assist. So there simply is no basis for concern in that regard.

Equally, we have heard comments that somehow this is new and it puts us out of step with the rest of the world, which, again, is not true. Just recently we have had the Australian Parliament confirm that its service providers are already regarded as being within the full interception capabilities in Australia. So we have not even gone that far. That is the case in Australia.

Can I also confirm that, as I said, with the service providers, their obligations have not changed. They have protection from conflict of laws. It is not internationally inconsistent. The interesting thing for me is that the New Zealand telecommunications companies put in submissions asking why the service providers were not subject to full obligations straight away. So if Labour’s position is right and we are being far too hard on these poor overseas multinationals, then they would be taking the opposite position to what New Zealand companies want, which is full extension of powers to service providers right now. That is what the New Zealand telecommunications companies want, so Labour has to decide whether it is backing the overseas mega-multinationals, or whether it is backing New Zealand companies. Our view is that at the moment we are in the right space. We have the duty to assist, and for now that is sufficient. If in the future there needs to be a greater level of obligation, bringing us into line with what New Zealand companies want and what overseas jurisdictions already do, then we have a process to do it.

It is completely wrong to say that there are no checks and balances on that process. The process is very clearly set out in legislation. It is akin to what Ministers do under any number of pieces of legislation for granting exemptions or putting restrictions in place. It is subject to the review of a specifically and highly qualified review panel, and of course it is subject to judicial review. It would make no sense to have a standing panel sitting around waiting for the odd situation where this would occur. I know Labour loves to set up committees and panels and put all its mates on them. But having a panel sitting there, doing nothing, for the odd occasion that this might happen—

Hon Trevor Mallard: Or their sisters-in-law.

Hon AMY ADAMS: —oh, you want to talk about Mike Williams—then it can do that. But in our world you do not do that. You have an appointed ad hoc panel that can have the skills and expertise needed in that case.

Clare Curran: Appointed by the Minister?

Hon AMY ADAMS: Yes, appointed by the Minister, Ms Curran—very well spotted. You can read. It is an ad hoc panel appointed to serve the needs of that provision. It is an independent panel and it reports back on how that works, so that if people have concerns there are of course other processes they can follow to review that as well.

Let us be very clear. This provision does not in any way change the power of these agencies. We have heard from Mr Horan, from the Greens, and from New Zealand First that somehow this is open slather for people to access our networks. Anyone who says that, frankly, is being absolutely duplicitous and giving quite false information. It is clear from the most basic reading of this bill that nothing in this changes what can be accessed or by whom. The warranting powers are in other legislation. They determine what can be looked at. This is simply the mechanism by which that warrant is given effect to. Nothing in this bill changes the warranting powers and nothing extends the warranting powers. All this bill talks to is the extent to which they can be given effect to.

Let us be very clear. The reason for this bill and this part of the bill is that it reduces the cost of compliance and the compliance time and commitment for companies in carrying out interceptions. Under the law that Labour wrote, there was the requirement for full standing intercept capability on every provider of any size, at every level. That is not necessary. It was hugely burdensome and it did not work for industry. This bill reduces that cost. It reduces it by tens of millions of dollars potentially, and it reduces the compliance time and cost on those companies. Anybody can see that to have a much more tiered, proportionate, sophisticated response targeted to where we need it is better than having a blank “everyone invest fully in areas where it is simply not needed”. This bill simply modernises that part of the framework where the warrants are granted under other legislation and given effect to. It is business-friendly. It strikes the right balance between need and futureproofing. It maintains all the privacy protections and it does not extend the reach any further.

CLARE CURRAN (Labour—Dunedin South): The Minister for Communications and Information Technology does not understand her own bill, the Telecommunications (Interception Capability and Security) Bill. She does not understand the impact of it, or she has got her fingers in her ears. I will just to talk about the response from industry. NZRise is a credible organisation that represents New Zealand tech-based industries—New Zealand, Kiwi companies. Google, Facebook, Yahoo!, and Microsoft represent a group of international service providers and all of them are actively opposing the key measures in this bill that we are talking about today. What they say is that as currently drafted this bill would impose in Part 2 a duty to assist on service providers and empower the Government to impose additional—not what the Minister just said, but additional—interception obligations on a service provider by deeming them in to be a network operator for certain purposes. That is the difference in this part of the bill. Clause 35 in this part of the bill provides unprecedented powers to a Minister to decide whether a service provider, which is the over-the-top provider such as the Googles or the Facebooks, etc., can be deemed in to become a network operator. In other words, they get treated just the same as organisations such as the telecommunications companies in Part 3 of this bill. It is the Minister who gets to decide that, on the recommendation of the Government Communications Security Bureau (GCSB), with no checks and balances.

The issue in this bill is that there are not the checks and balances. There is a shadowy situation being set up for recommendations to be made on national security, including something called economic well-being, which is not defined, and huge powers, discretionary powers, being given to a Minister to make those decisions. This is not the New Zealand way of doing things. The New Zealand way of doing things is where you put into legislation measures that ensure that dodgy decisions cannot be made. We have no guarantee in this legislation that a Minister, based on a recommendation that cannot be made public, will not make a questionable decision that cannot be challenged, or, if it is challenged, it is through a judicial review.

The big issue for the New Zealand - based companies is that the smaller tech-based companies such as our emerging innovative companies are concerned that they are going to get caught up in this legislation and be caught up in being defined as the traditional telecommunications companies are, and those smaller companies do not have the resources or the means to question, to provide a push-back, or to have the kind of dialogue that may need to be had, which their bigger brother organisations such as the Telecoms, the Vodafones, etc., of the world could do. They do not have the means to do that and so there is no check and balance for them. Those are the New Zealand - based tech companies and they have written as a group. Every member of Parliament in this House will have received in the last few days a letter saying: “Please do not broaden the definition of ‘network operator’ in this legislation to include us.”

The Minister shakes her head—the Minister shakes her head. Well, Minister, you have heard it said because there are cross-references in this legislation to definitions that do provide an enormous encompassing. Yes, they do. So, as with the GCSB legislation, everybody else in the country is wrong except for the Minister. Is that right? Everybody else in the country is wrong! Yet the evidence could not be given to the Law and Order Committee on these matters properly. The Minister referenced tens of millions of dollars that are somehow going to be saved. In the regulatory impact statement provided on this legislation all of that information was redacted. We were not allowed to hear that information.

In the first version of the bill, clause 24(6) would have extended the application of the duty to assist to global service providers. This was a hotly debated part of the bill and it was clearly an issue. Eventually, there was a decision to delete that clause, which would have helped, but the fact is that along with that went an expanding of the definition of “service provider”, which meant that that conflict in international law, which we have talked about several times tonight in this debate, has been expanded. So every time “service provider” appears in this piece of legislation, as set out in clause 3, it “(a) means any person who, from within or outside New Zealand, provides or makes available in New Zealand a telecommunications service to an end-user (whether or not as part of a business undertaking and regardless of the nature of that business undertaking); but (b) does not include a network operator”. That is the difference between the two definitions, but the fact is that it is still an extremely broad definition, and clause 35 of this bill means that the Minister, on the recommendation of the GCSB and without a check and balance, can deem in one of those service providers and make it a network operator. You deny in this Chamber tonight, Minister, that that is a wrong interpretation. That is a true interpretation.

So that gives the Minister enormous, unprecedented powers. How are those powers reflected in the existing legislation? This is a new provision and it is a provision that has been hotly contested by, as I have said, the international organisations—the Googles, Facebooks, Yahoos!, and Microsofts of the world—who argue that this puts them in a direct conflict of law, which makes our law look very foolish to the rest of the world. And for the New Zealand - based technology companies, that definition of “network operator” draws them in, in a way that is unprecedented in terms of the potential conditions that are going to be imposed on them by surveillance agencies, and that will be the stifling of innovation in this country. What is missing is a check and balance from another entity that provides some balance and provides some good advice to the Minister and recourse for those smaller companies in terms of pushing back against those decisions over which they have no control. I would like the Minister to get up again and tell me how those organisations are supposed to operate under this legislation as it is put before us tonight.

STEFFAN BROWNING (Green): I rise to speak to Part 2 of the Telecommunications (Interception Capability and Security) Bill. This interception capability and security is again part of the same problem that we talked about in Part 1, where we have to ask where the instructions are for New Zealand to go down this track. Was it just because of the Kim Dotcom case where there was some illegal surveillance, some illegal spying, and we are fixing that up? Because even when the officials were looking at this bill—looking at how we compare with other countries, how our legislation stacks up, and what layers of interception capability were required—the places they looked at were our “Five Eyes” partners. I do not recall seeing anything else. There was the United States, the United Kingdom, Canada, and Australia. That is where the comparisons were done. Clearly, there is an international move, and the Minister for Communications and Information Technology herself has said how there was nothing internationally that we were not consistent with.

Well, we are apparently getting less and less inconsistent with the “Five Eyes” - Echelon partnership, and it would seem, in fact, that this is what a lot of this is about. Of course, we need some capacity for natural law surveillance. We have issues of kidnapping and issues of serious crime where we expect and accept, it seems, as a community a certain level of surveillance. That can happen under existing legislation, and clearly does. What was happening illegally, but what was not meant to be happening, was spying on New Zealand citizens by an internationally linked spy agency, the Government Communications Security Bureau (GCSB). I will keep on about Waihopai and the spy agency thing because that is often forgotten about when we look at where these different capabilities are in terms of access, and I did touch on that earlier.

In her letter to us, the Minister was talking about clause 39, which is part of Part 2, and the fact that the bill currently allows the responsible Minister to direct that a network operator must not resell an overseas telecommunications service in New Zealand where the interception capability or lack of interception capability raises a “significant risk” to law enforcement or national security. Of course, we have looked at some of that in the interpretation provisions, but that also can be rather subjective.

What is a significant risk to law enforcement? What is a “significant risk to national security”? Some of this is necessary only in a full surveillance State. It is not about dealing with organised crime in a way that the police could be managing under other law, or with some other issues that might be addressed under the search and surveillance legislation. This is law that allows something much greater and, as I say, that is only necessary in a full surveillance State—Big Brother. There is a need for a full, genuine inquiry into what we actually want as citizens in this country as a basis for surveillance law and surveillance agencies.

We need that discussion because these things—the Government Communications Security Bureau Amendment Act 2013 and this bill, and the interception capability in Part 2 here—are all about trade-offs between privacy, human rights, and the level of access by State agencies, and some are, unfortunately, linked with overseas agencies. So what would we do? What are we prepared to do as citizens in terms of that trade-off? There is some point at which we will say “No, the risk isn’t worth it.” because the event or the concern may not happen in a matter of years—terrorism as such—or it might happen once or twice in terms of a kidnapping. We have to look at that level of risk as to how much we will give over in terms of reduction in privacy and the like. So the level of access is a big part of this.

Under Part 2 of this bill, the network operators as such must ensure that every public network they own, control, or operate has full interception capability. I think that what the Minister and the officials have achieved in terms of the bill is probably very, very effective for what they are trying to achieve, but it does not make it right. That is the point that the Greens are very, very concerned about. We do not think it is right. There are other parts around effectiveness, I must say, and you would have to raise questions about the size of the operators—those with fewer than 4,000 customers. The bill has got a staggered level of obligation around capability. In some respects you could say that is fair enough, because maybe some do not have the economic capacity to achieve everything, but they still have to be basically able to turn it on, if the Minister decides it.

In that different degree, and also in the aspect around encryption and decryption, there is some encryption that these agencies are not going to nail. We know that through the committee stage—not this Committee stage, but the select committee stage—there was an acknowledgment that not everything is going to be able to be surveilled. Then you have to say that if that is not going to be that effective at that point, is it fair that some operators still have to provide capability when another one has got a way through or a way out of it? So we have to ask whether there is a point where we do not do some of these things because the things that are absolutely critical and accepted by the community can be done through another method. So if it is not even going to be able to be applied fully, maybe it is time for us to have a rethink. That is why we say we need to have a full, independent inquiry to look at this, including the interception capability aspect of it.

The Law and Order Committee also recommended that proposed regulations relating to Part 2 of the bill be the subject of consultation with the telecommunications industry. Clearly the Green Party will support Clare Curran’s Supplementary Order Paper 370 on that basis, because there is in it that concept of having an industry group or others, where some of these issues can be considered.

So the Green Party will be opposing this bill and will be looking forward to other aspects of this bill to bring up too. Thank you.

KRIS FAAFOI (Labour—Mana): Thank you very much for the chance to speak to Part 2 of the Telecommunications (Interception Capability and Security) Bill. On this side of the Chamber, we would like to thank the Minister for Communications and Information Technology for standing up and taking a call on this part of the bill, because there is no better advertisement for the reasons why this legislation ought not to pass than when the Minister is talking about it. That is because everything she has said does not marry up with what the reality is.

The Minister said that nothing has changed in Part 2 of this bill about the reach or the powers that the Government has to surveil via telecommunications companies. That could not be any further from the truth. It is clear from the Minister saying that that those things have not changed and that her ignorance of the concerns around the industry has not changed. The Government’s arrogance around this bill and the Government Communications Security Bureau (GCSB) legislation has not changed. The Government’s attitude towards New Zealand Bill of Rights Act considerations around privacy has not changed. The Government’s inability to find some kind of balance between the need to surveil and the rights of the individual citizens has not changed, because it has rammed through this piece of legislation in haste, and it has given huge powers to the Minister in the chair, who has taken only one call to completely and utterly deny the concerns that the industry has around this bill.

One of the assertions made by the Minister in the chair was that the industry was quite happy with the level of consultation and with the costs that it will be facing if it is compelled by this bill to do what it needs to do. That could not be any further from the truth. In a submission to the Law and Order Committee, Vodafone—one of the largest telecommunications companies, if not now the largest—said that “The burden continues to fall disproportionately on existing large telecommunications providers, ignoring the significant interception gaps created by the proposed regime inadequately covering OTT and smaller providers;”. So there you have it. Vodafone is saying that there are going to be huge cost implications to the company, and the Minister completely and utterly denied that.

Later on in its submission to the select committee, Vodafone also went on to make a point around network security, saying that “The proposed approval process does represent a significant compliance cost to network operators, in order to further government objectives. Network operators should be fully compensated for these additional costs.” So there will be costs to the network operators in this bill. Vodafone has said that within its submission to the select committee. But you did not hear that from the Minister during her contribution on Part 2.

There were also concerns from the industry around the lack of consultation on this piece of legislation, and my colleague Clare Curran has brought in Supplementary Order Paper 370 to bring in a measure for that. I will come to that later, but I do want to show or read out to those at home the part of the regulatory impact statement that pertains to industry consultation. It says: “In developing the above proposals [information withheld] telecommunication industry representatives were consulted.” There is a very small gap there where it says “information withheld”, so it seems like there were not many consulted. Then the next point goes on: “Wider consultation with industry was not undertaken, given the technical and sensitive nature of the subject-matter,”. That is borne out in the submissions to the select committee, and that was certainly borne out in the submission by Vodafone. It wants to have more consultation with the Government and with those intelligence agencies, so that if there is going to be any major change to its network or any major cost implications to it, it has the ability to talk that through with the Government or with the surveillance agencies before that is imposed upon it. I think that is a reasonably sensible thing to do, and that is why we have got this Supplementary Order Paper in the name of Clare Curran, which will look to establish a technical advisory board so that those kinds of issues can be worked through before they are imposed on telecommunications companies, at potentially huge expense to them and without the technical discussions around what kinds of implications that will have for their networks.

Can I just move to clause 10 of the bill, which is also around the interception capabilities of this piece of legislation, and move towards a submission that was made by Microsoft. In her contribution earlier, the Minister said that this bill does not change anything and that things have not changed, but can I take the opportunity to read a section of the submission from Microsoft, a huge software company operating right around the globe. Microsoft is realistic. In its submission it said: “Every day the New Zealand Government and millions of Kiwis are using technology to get things done securely and privately over a diversity of data connections.” We all know that. “Of course, one side effect of this”, it said, “is that it is no longer possible to tap into a phone line and interpret every signal that is communicated over that line. The world has changed”—we can tick that off; everyone can agree with that—“and it can’t be assumed that the same approach that worked for a phone conversation can simply be applied to every service that happens now to be delivered over that same network. Yet the proposed law will include powers to extend telecommunications interception capability obligations to every provider of any good or service that enables or facilitates virtually any conveyance of any information from one device to another.” It then asks us to look at the definitions of telecommunications service under the Telecommunications Act.

The damning sentence here, which the Minister in the chair completely ignored or was ignorant of, is, as it goes on to say: “That would be a dramatic change to the law, and it is far from clear why this is necessary.” I will just repeat that for those who might be listening at home: “That would be a dramatic change to the law, and it is far from clear why this is necessary.” So we have actually got an opportunity now, because the Minister is in the chair to answer that question from Microsoft as to why that expansion of powers, which she says does not exist in this bill, is necessary, when the Minister says that nothing has changed in terms of what the surveillance agencies can access and the types of telecommunications they can access. The Minister said in her contribution that nothing has changed. Microsoft, which is not a little company in a back shed in Hokitika—sorry, Mr Damien O’Connor—is saying that this is a huge change in the law. Microsoft is asking a question and saying that it is far from clear why this change is necessary. So maybe the Minister in the chair, who said in her speech that nothing has changed, would like to stand up and answer that question, which I am putting to the Minister in the chair for Microsoft. Why is it necessary for you to change the law, which you said is not being changed? The Minister has said that nothing is changing.

Hon Amy Adams: No, I didn’t.

KRIS FAAFOI: The industry disagrees. She is exasperated. She has taken one call. Tell us why you needed to change this thing, which you said is not changing. Why are you ignoring the likes of Vodafone? Why are you ignoring the likes of InternetNZ? Why is the Minister ignoring the likes of Microsoft? The Minister is changing a piece of legislation, which Microsoft says goes well beyond what she said she was doing. What is the rationale for that? Hopefully, the Minister in the chair can take another call. As I say, we do enjoy it when she does. I am sure that the answer will not answer the question I have asked, but if the Minister could take an opportunity to address that question from the Labour Party and also from Microsoft, we would be very happy.

Maybe she would like to look at the technical advisory board that could be set up under Clare Curran’s Supplementary Order Paper and that could answer that kind of question, but, unfortunately, I do not think the Government is going to take up that very sensible proposal from this side of the Chamber. It is another indication that this Minister’s attitude towards, and ignorance of, the concerns about this bill have not changed. The Government’s arrogance around this bill and the GCSB has not changed, and the Government’s arrogance around balancing the rights of private citizens and surveilling them for security reasons has not changed, either. It has rammed this piece of legislation through.

Part 2 compels network operators to do something that they agree they should do, but it puts massive costs on to them. They are worried about the lack of consultation leading up to this bill and also about the lack of consultation that might happen when this legislation is enforced. That is why the Government should seriously think about looking at this Supplementary Order Paper 370, which contains the—

IAN McKELVIE (National—Rangitīkei): I move, That the question be now put.

RAYMOND HUO (Labour): I rise to take a call on Part 2. Before I start I would like to reiterate the reasons why we are so strongly opposed to this particular bill, the Telecommunications (Interception Capability and Security) Bill. We have primarily three main reasons why we are so strongly opposed to this bill. The first one is that this bill seeks to facilitate the implementation of its companion legislation, the Government Communications and Security Bureau Amendment Act, which fundamentally reduces the rights and freedom of New Zealanders to communicate with each other by failing to provide sufficient protection against the spying on New Zealand citizens by State agencies. The second reason is that the bill in its current form is poorly and broadly drafted. Thirdly, it is unacceptable that such concessions have been made to the global majors, such as Google, Facebook, etc., but not to the citizens of New Zealand.

Part 2 provides interception duties. Part 2, from clause 9 through to clause 42, sets out the interception capability duties that apply to network operators and service providers. The primary duty, which, as the Minister in the chair, the Minister for Communications and Information Technology, has acknowledged, is the duty to have full interception capability, remains substantially the same as in the Telecommunications (Interception Capability) Act of 2004—namely, the current Act. Despite the fact that the primary duty remains largely the same, the problem is that under the current bill the definitions provided in Part 1 are either inaccurate or too broad. The bill as drafted places onerous obligations upon network operators and may capture many whom it may not have been intended to. So without clarifying the definition, blog sites such as news sites like the New Zealand Herald or Scoop and other—

Hon Simon Bridges: What about sites that Shane Jones looks at?

RAYMOND HUO: Well, what about Mr John Banks? Also, other service-oriented websites such as TradeMe are likely to be captured by this legislation, as well.

Hon Simon Bridges: What’s he got to do with it?

Kris Faafoi: He’s all over the websites.

RAYMOND HUO: Ha, ha! Subpart 1, “Duty to have full interception capability”—namely, in clauses 9 and 10—sets out the primary duty that applies to network operators, which is a duty to have full interception capability in respect of every public telecommunications network that the network operator owns and every telecommunications service that the operator provides in New Zealand.

But what are we talking about here, and what do all transmissions and information infrastructure mean in terms of ordinary life in New Zealand? We are not talking about rocket science, we are not talking about somebody else’s business; we are talking about emails, we are talking about telephone calls, messages, history or records left on, for instance, Facebook or Google, or any website we have just visited. They are all potentially accessible without a warrant by spy and other agencies.

So all internet service providers, as a starting proposition, are 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. This is a huge cost and it is a huge broadening of the powers of the State to access the private information of New Zealanders. Subpart 2 is “Reduced duties”, and I would like to touch on that later on. The so-called GCSB amendment Act, which this bill seeks to implement, provides for the ability to intercept all transmissions that apply to information infrastructure for any purpose to do—

SCOTT SIMPSON (National—Coromandel): I move, That the question be now put.

Hon TREVOR MALLARD (Labour—Hutt South): I would like to make a contribution on Part 2 of the Telecommunications (Interception Capability and Security) Bill, and I would say that this is one of the two really substantive parts of this bill. This is a bill that is exceptionally controversial. It is one that divides the country, it is one that divides the House, and it is one where I think it is important to have a full debate. I know I am not meant to draw attention to the absence of members in the Chamber, but I think I can say that I was away for about a quarter of an hour of this debate, and in all the time that I have been here, I have heard only one substantive call from the Government. I think it is important that Ministers do make proper contributions and respond in the Committee stage.

To really emphasise the importance of this part, I want to indicate to you, Mr Chair—as I am sure you are aware from looking at all the clauses—that this Part 2, between clauses 9 and 42, sets out the interception capability duties that apply to network and service providers under the bill. There is a primary duty that sits here that is very similar—substantially the same—to what has been in place under the current Telecommunications (Interception Capability) Act from 2004. What Subpart 2—that is, between clauses 11 and 20—does is provide for a reduction of the full interception capability by introducing lesser duties, which will apply to certain classes of network operators. I do want to give notice to the Minister for Communications and Information Technology. I am going to come back to those schools in west Auckland that are providing network services to parents in their particular area and ask whether, in fact, they will have a duty to comply with clauses 9 and 10. I am sort of gathering from the way the Minister’s head shook earlier, and one could almost hear the rattles from back here, that that would not apply. But then the question is whether they have an obligation to be intercept-ready or whether they have a duty to be intercept-accessible. My understanding is that they will end up having to be intercept-accessible.

Then you ask the question: if an organisation has to be internet-accessible, and it is something like a school board, is it, in fact, appropriate for the Government Communications Security Bureau (GCSB) or the SIS, or, for that matter, the police, if it is a police matter—there has been quite a lot of discussion here about the intelligence agencies and their surveillance, but not a lot of discussion about the surveillance on the part of the police. My question to the Minister is whether this duty to be intercept-accessible will apply to schools that are providing internet service provision to their communities. There might be only a thousand of them. I understand that if they do not go over 4,000, they do not have the full requirements. But if there are only a few hundred parents, what is the requirement there?

The question then is that if the level of interception capability that is required from that school operator—my understanding is that there is a provision in the bill for the level of that to be increased not by legislation, but by a decision by a Minister about a particular provider. One of the very serious questions I have got is whether it is appropriate that just at the whim of a Minister—not in the case of a proper, warranted arrangement and all the things that are meant to happen under the GCSB and SIS legislation, but just at the whim of a Minister—the entire organisation has to provide an increased level of interception capability. I accept that there is an ability for the affected network operator to make submissions to a Minister. There has got to be certain consultation, and the applicable criteria have to be taken—

Dr PAUL HUTCHISON (National—Hunua): I move, That the question be now put.

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

Ayes 61

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

Noes 58

New Zealand Labour 33; Green Party 14; New Zealand First 7; Māori Party 2; Mana 1; Independent: Horan.

Motion agreed to.

The question was put that the amendments set out on Supplementary Order Paper 366 in the name of the Hon Amy Adams to Part 2 be agreed to.

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

Ayes 61

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

Noes 58

New Zealand Labour 33; Green Party 14; New Zealand First 7; Māori Party 2; Mana 1; Independent: Horan.

Amendments agreed to.

The question was put that the amendment set out on Supplementary Order Paper 370 in the name of Clare Curran to insert new clause 35A be agreed to.

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

Ayes 56

New Zealand Labour 33; Green Party 14; New Zealand First 7; Mana 1; Independent: Horan.

Noes 63

New Zealand National 59; Māori Party 2; ACT New Zealand 1; United Future 1.

Amendment not agreed to.

A party vote was called for on the question, That Part 2 as amended be agreed to.

Ayes 61

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

Noes 58

New Zealand Labour 33; Green Party 14; New Zealand First 7; Māori Party 2; Mana 1; Independent: Horan.

Part 2 as amended agreed to.

The result corrected after originally being announced as Ayes 61, Noes 57.

Part 3 Network security

IAIN LEES-GALLOWAY (Labour—Palmerston North): I raise a point of order, Mr Chairperson. Although it is not in order to question your decision to accept a closure motion, as you did for Part 2, I would like to ask your advice about how you are going to approach Part 3. Part 2 was an extremely substantive part of the Telecommunications (Interception Capability and Security) Bill, and yet we managed only an hour’s debate on Part 2. Part 3 is an equally substantive part of this bill. This is a bill that is of significant public interest, and in which there is significant interest from the Opposition benches in debating it part by part. I would like to take some advice from you about whether you are going to consider giving Part 3 a little bit more substantive debate than you did for Part 2.

The CHAIRPERSON (Eric Roy): I will review the debate as we go along and make a decision accordingly.

CLARE CURRAN (Labour—Dunedin South): Part 3 of the Telecommunications (Interception Capability and Security) Bill is the part of the bill about which every single telecommunications company and every entity that came before the Law and Order Committee expressed grave concerns. They expressed concerns about the extent of the powers that this bill provides to both the Government Communications Security Bureau (GCSB) and to the responsible Minister, and about what the impact of the costs of that will be on the viability and the operational requirements of those entities.

The Law and Order Committee was silent on that latter matter. I think it is very important that the Committee hears this. During the process of the select committee, every single telecommunications company that came before the committee was specifically asked by the Labour side of the select committee to provide the committee—and this was supported by the chair—with information on the cost impact of this part of the bill on their business. A number of those companies came back to the committee with substantive supplementary submissions. They included Telecom, Vodafone, Chorus, Enable Networks, and a number of other telecommunications companies that are deemed to be network operators under this bill. They provided a sobering picture for the committee, from hundreds of thousands of dollars just to set up administrative requirements, to the up to $50 million that the submission of Enable Networks, I think, suggested could be the impost on the company should it be required to change a key arrangement that it has with a provider in rolling out its part of the ultra-fast broadband programme.

Leaving aside the merits or otherwise of who those partners were and whether those decisions should or should not be made, those cost impacts are not insubstantial. In fact, they are very substantial for our telecommunications industry and for our technology industry. However, during the discussion on this bill subsequent to receiving those supplementary submissions, the committee was not allowed to discuss them. We were not allowed to ask officials about those cost impacts, because it was ruled out of order. Taking into account the redacted regulatory impact statements, held up in the Chamber before dinner, which showed great pages that were empty because they had been redacted when it came to providing the select committee with information about any economic analysis that had been done, I would just like the Committee to know that we were not allowed to discuss the economic impact submissions that had been provided to us by those telecommunications companies. This is just simply not acceptable.

This legislation is being rushed through the Committee stage tonight and the Government is trying to push through the third reading this week so that it can get it off its plate, and so that the country can move on, and the Minister can pretend that everything is all right. Every single telecommunications company, every single network operator that submitted to us said that there was a significant cost impact on their company in implementing this bill. The National Government people on the other side of the Chamber seem to think that that is just fine.

So who, when we are discussing this bill, is sticking up for the industry? Who is listening to the industry, whether it is the local tech companies or the bigger companies that are saying that there is a serious conflict with international law with this piece of legislation? Who is sticking up for them? Well, it is certainly not the Government of the day.

Instead, the Government talks to us about this security issue that, again, we were not allowed to hear evidence on. We were not allowed to hear any evidence from the surveillance authorities.

The CHAIRPERSON (Eric Roy): Can I just pause the member because I want to make a correction. The vote on the question that Part 2 as amended stand part was incorrectly announced as Ayes 61, Noes 57. After reviewing the record, the correct result should have been Ayes 61, Noes 58. The record will be corrected accordingly. A second call goes to Clare Curran.

CLARE CURRAN: Thank you. Just coming back to the specifics, in its submission to the select committee, Telecom, which is one of New Zealand’s major telecommunications companies, referred to one of the issues that it had with the bill. It opposed the onerous provisions in Part 3, which it felt would have a significant impact on how it went about its business, as did the other telecommunications companies. It also referred to one of the problems it had. It felt that there was not a level playing field for what we call the traditional telecommunications companies—the network operators—and those service providers that are the over-the-top providers, so, say, for comparison purposes, the likes of Telecom versus Microsoft.

Telecom told us that if it wanted to sell to a customer in New Zealand a bundled product that included your internet connection, your telephone line, and also another package, which might be a Microsoft Office - based product, so that you could have that all at once, then it had a problem in that you could also go to Noel Leeming or another outfit to buy the Microsoft Office - based product over the counter. If you wanted to buy that in a bundled way from Telecom and get it for a bit of a cheaper price, Telecom may have to provide an intercept-capable capacity on that Microsoft Office product, whereas if you went to Noel Leeming and bought it over the counter, that would not be required. Telecom had a point that there was a discrepancy in the law.

Clause 39 of the bill, which the Minister has gotten rid of in Supplementary Order Paper 366, actually on the face of it appeared to be addressing that issue for Telecom, but there is a question. Because Telecom is a network operator and because it falls within that definition of “network operator”, Part 3 applies directly to it. Part 3 of the bill provides the onerous requirements on a network operator that it has to basically be at the bidding of the GCSB, which can now go inside the organisation and can determine what it can and cannot do. If that telecommunications company decides that it does not like that, then the GCSB has the remedy of going straight to the Minister, and the Minister can make the decision. There really are no checks and balances around that.

Despite the fact that clause 39 has now been deleted from the bill, the question remains, and this is a question directly for the Minister, and it would be good if she could answer it in the Committee tonight: do the likes of Telecom have to come and ask for an exemption if they want to sell a bundled product and not provide an intercept capability over that product? Do they have to, Minister? Do they have to? They do have to come—

Hon Amy Adams: I heard you. I’ll answer shortly.

CLARE CURRAN: So was that a yes?

Hon Amy Adams: I’ll answer shortly, when I take a call.

CLARE CURRAN: Oh, thank you. That would be good if you could get to your feet and answer it, because it is actually a very significant question.

The reason it is a significant question is that this Government is a Government that trumpets its ultra-fast broadband scheme as something that is going to—even though hardly anyone is taking it up at the moment—kick-start the economy. And yet this legislation is actually making it harder for the network operators, the retail service providers, and the internet service providers to actually provide bundled products that are actually going to drive the uptake of ultra-fast broadband.

So on the one hand the Government is saying it is all great and everything is going to be wonderful in this new fibre world, but on the other hand it has got legislation that is actually making it harder for the locally based companies to actually bundle up those products and sell them to consumers. It is putting onus on them that is going to cost them money or make them go and ask for an exemption, potentially—and it would be good if we could get an answer from the Minister as to whether or not they can actually sell those products with or without intercept capabilities, because if—

Hon AMY ADAMS (Minister for Communications and Information Technology): I thought I would take a call early in Part 3 and run through very clearly what this part of the Telecommunications (Interception Capability and Security) Bill intends to do, so that everyone has that information in front of them. What I want to do is to start by addressing the question of the member, Clare Curran, that I said I would address. She raised a question about Telecom seeking exemptions, which relates to Part 2, which we have now, of course, completed, but, nonetheless, she has asked me while we are talking about Part 3. As she will know, the restriction on selling resold services was in clause 39, which has been removed, so that really answers her question in respect of the right to seek exemptions. If they have other exemptions that they wish to seek from their general capabilities, then, clearly, there is a regime in Part 2 for that. Turning to—

Hon Trevor Mallard: Oh, uneven treatment.

Hon AMY ADAMS: Oh, do not be silly, Mr Mallard. That reflects what is in the current legislation.

So in Part 3, which we are on and we are talking about now, what I want to reflect is that this is the part of the bill that is a new regime. I want to be very clear about that. Currently what we have is a loose partnership arrangement where a number of the network operators—not all, but some of them—have seen the value in working with the intelligence agencies to identify threats. What I think everyone in this Committee is likely to accept is that the cyber-threat environment is considerably more serious today than it has ever been, and that is going to continue very much to be the case. If we do not protect very carefully the security of our telecommunications networks, then we not only put at risk the safety and well-being of New Zealanders, but we put at risk all of the intellectual property of New Zealand businesses, and all of our economic prosperity is potentially at risk.

I think everyone recognises—or, at least, all sensible people recognise—that if you want to be a country that is a good place to invest and do business in, then you have to be able to reassure people that your telecommunications infrastructure is secure. I think everyone would agree with that. What we know is that increasingly there are attacks by various players who try to get access to the telecommunications networks in New Zealand and through those networks to gain either commercial ends or some other ends that suit their agendas. This part of the bill is about doing what we need to do in a world of increasing threat to ensure that there are not undisclosed capabilities in our networks to copy or divert or destroy or disrupt data. These are very real threats, and I think anybody with even a cursory understanding of the current geopolitical or threat situation understands that the cyber-threats are real, they are very serious, and they are increasing all the time. That is commonly understood in freely available publications.

So what we have at the moment, as I said, is an informal situation where the better network operators choose to go to the intelligence agencies and work with them to identify and address threats. But, unfortunately, that process has its failings. It is not transparent, it does not apply to everyone, not all operators know it even exists, and, of course, there is no power, ultimately, to enforce it if it does not work. So what the powers in this part of the bill require is for network operators—and let me be very clear that it is only network operators. It is not service providers, it is not cloud companies, and it is not software providers. It is only network providers that are subject to this part of the bill. They approach the Government Communications Security Bureau (GCSB) if they are dealing with an area of critical infrastructure, and we have tightened the definition around where that applies. They identify to the GCSB what their intentions are. If there is a risk identified, then the network operators themselves decide how they want to fix it.

The GCSB does not tell them what to do. The GCSB does not do anything. It does not make them do anything. It does not require any particular fix. The network operator is the only one who determines how it wants to address that risk. If, however, the GCSB is concerned that there still remains a significant threat to national security—not just a risk; a significant threat to national security—then the only power the GCSB has is to refer that up to the Minister. Before the Minister can do anything about that, they will now, under Supplementary Order Paper 366, have to go through another check, which is to be reviewed by the Commissioner of Security Warrants to ensure there is a second set of independent eyes reassuring the Minister that the information that the GCSB has presented confirms that there is a significant threat to national security.

For me, if we have a significant threat to our national security through a vulnerability—a serious vulnerability—in our network infrastructure, then we all have an interest in seeing that addressed. I do not want to be in charge or be in a country where we have absolute vulnerabilities in our network infrastructure, and we see them and we can do nothing about them. It was only last year that Australia made some decisions to ban certain players from certain parts of its network, and we had all of this side of the House jumping up and down, saying: “Why isn’t the Government banning this? Why isn’t the Government doing that?”. The reality is there is no framework to do it. So if there is a threat—and they are the first ones to jump up and down if they see one—right now there is no power for a Government in New Zealand to respond to it. There is none.

What we have done is create a situation where in the most serious cases—in the most serious cases, and it would be very rare—it can be escalated to the Minister. After it has been through the review of the GCSB and another review of the Commissioner of Security Warrants, then the Minister has to go through a detailed process, set out in the law, of consulting with all the affected parties. Only then, if the threat is serious enough to the well-being of New Zealand, can action be taken. Yes, that is a new power. It is a new framework, but we are living in a new age. These threats are real, they are serious, and we need to have a framework to respond to them.

GRANT ROBERTSON (Labour—Wellington Central): Before I get into a substantive contribution on Part 3, I want to respond to what I guess I take to be the tone of the comments that the Minister for Communications and Information Technology has just made. It was essentially that it is all or nothing. You either believe that because there are potentially security threats involving network providers in New Zealand, and therefore you have to accept anything in terms of security arrangements. That is essentially what the Minister has just told us, and that if anyone does not do this, they are somehow traitorous and acting against the interests of New Zealanders.

It is not that simple, Minister. Of course there need to be provisions in place to protect our security and to protect the security of New Zealand citizens. But those must always be balanced against the rights and freedoms of New Zealanders, and the ability of companies to operate in New Zealand to provide the very services that New Zealanders want. So operating on this “take it or leave it” approach, as the Minister is doing, is actually disingenuous.

If we are trying to create law that is robust and that upholds New Zealanders’ values, then we do that on the basis of a balance. We do not do that on the basis of the Minister coming to the House and saying “Take it or leave it. Here are these expanded powers.”—and she admits these are brand new. These powers invest a great deal of influence in the Government Communications Security Bureau (GCSB) and in the Minister, and we just have to accept that, because the Minister says that is what is required. Well, that is not right. As Clare Curran said in her earlier contribution, the Law and Order Committee was prevented from talking to the GCSB about this Telecommunications (Interception Capability and Security) Bill.

This Part 3 is the part of the bill in which our dear friends at the GCSB reappear. They have been quite the stars of Parliament over the last couple of years, and in particular their Director, Mr Ian Fletcher, the childhood friend of the Prime Minister. The GCSB’s role here in network security is significant. The Director of the GCSB, as the Minister herself has just said, sits at the centre of the process by which decisions will be made around whether there are national security issues, and whether or not there are areas of specified security interests that need to be dealt with.

Well, let us take a look at the record of the GCSB and whether or not we believe that giving such wide-ranging powers is appropriate. We are talking about an agency that has been involved in up to 88 cases of illegal spying. We are talking about an agency that has changed its story time and time again about its role in the Kim Dotcom affair. The Minister says that it is all fine because the Director of the GCSB then goes to the Minister. Well, we saw what happened with the role of the Minister who was looking after the GCSB, in terms of John Key.

I do not feel reassured by that at all—that the Minister is doing that. In fact, all the evidence we have seen is that we should be very concerned about giving increased powers to the GCSB in this way. We should be very concerned about the Minister then having the ability, once that recommendation has been made by the Director of the GCSB, to go off and decide to put in place the security measures that she is able to, under this part of the bill. The GCSB’s role, as we know from the earlier legislation that was passed, has now been greatly expanded. Its powers are greatly expanded. I stand here today in front of a bill with brand new material, it has never been put forward before, and the Law and Order Committee did not even get to talk to the GCSB about its role in doing this. I have absolutely no confidence, I have to tell you, that giving these powers to the GCSB without the Law and Order Committee being able to scrutinise them, and to ask questions of them about how they will go about this work, is appropriate. We should not be passing Part 3 of the bill with that in place.

I want to reflect on what some of the submitters have said about the question of this part of the bill. In particular I want to refer to the submission from the New Zealand Telecommunications Forum. What they said was that their key concerns relating to Part 3 were that these new obligations had insufficient protection, transparency, and appeal rights, and that they imposed additional obligations, for which there was no compensation for any additional costs. That essentially draws out two of the key elements of this bill that—I hope I have not pushed the Minister to tears or anything like that. No. No, that is good, seeing the tissues coming out. This highlights the two main bits of the bill that we have concerns about—the fact that there is insufficient transparency around these issues—because under this part of the bill the transparency is provided, according to the Minister, by the fact that she has included, through Supplementary Order Paper 366, a role for the Commissioner of Security Warrants.

Our problem starts at the beginning of the process, the transparency at the beginning of the process involving the GCSB, because consistently under this Government the GCSB has operated outside the law, and then when it has been drawn back inside the law we have not been able to question the GCSB. We were not able to question the GCSB when its own legislation—

Hon Trevor Mallard: They changed the law from the inside.

GRANT ROBERTSON: Exactly. Well, they did. That is right. They made their unlawful actions lawful by changing the law. But then we were not even able to question the GCSB properly about its own law. Then the Law and Order Committee was not able to question the GCSB about this law that the Government has to put into place. So I can only agree with the Telecommunications Forum that this bill does that.

It is also the question about the additional costs that have been put in place. Nowhere in this has the Minister been able to accurately answer, in the debate that I have heard, how that is going to be mitigated, and how the so-called chilling effect on the industry in New Zealand will be able to be dealt with.

Part 3 of the bill, in our opinion, is a significant departure from the law that we have had in New Zealand before. I simply do not agree with the Minister that there was no way to deal with significant security breaches under current New Zealand law. That simply cannot possibly be true. The Minister has got up and put that up as a straw man, to try to say again: “It is all or nothing. If you do not have this, there is absolutely nothing that is available to New Zealand to protect our national security.” That is absolutely patently wrong and ridiculous and the kind of straw man argument that has typified everything that happens throughout this.

We have on this clause, as on others, Supplementary Order Paper 370 in the name of Clare Curran to try to mitigate some of the worst aspects of this bill—in particular, in clauses 46, 47, and 48 of this bill. We would urge members of the Committee to support those amendments. What they attempt to do is at least give some more certainty to network operators about who is captured by this bill. We believe that currently the provisions are extremely wide on this and we need to make sure that there is a far better provision in the law.

We also do not believe that the appropriate method of granting exemptions here, under clause 48, should come through the GCSB. Unfortunately, the Government voted down the provision on the technical advisory board, which would also have had a role in monitoring these issues and ensuring that there was some independence. That technical advisory board would have had a significant role in this area, and again was asked for by members of the Telecommunications Forum.

I will finish this contribution now on Part 3 by saying to the Committee that what we have here is a part of the bill that is brand new, untested law being rammed through Parliament, with Government members taking closure motions to prevent Opposition members from raising concerns, and with very limited substantive contributions from the Government. That is not on, with such significant changes. We do not believe that New Zealanders’ rights to be protected are being balanced with their freedoms to use and have access to services. This bill fundamentally fails the test of good law, and Part 3 should not be supported.

Hon TREVOR MALLARD (Labour—Hutt South): I want to start off by picking up a point that was referred to by my colleague Grant Robertson in his speech. That is the what I consider particularly offensive comments by the Minister for Communications and Information Technology that if people are opposed to parts of this Telecommunications (Interception Capability and Security) Bill or part of the direction, then they are effectively supporting terrorism.

I am, I think, one of the few members in the House, and only by virtue of being a duty Minister, who has been involved in what was a very serious threat to New Zealand. I, only as a result of that, have some knowledge of the systems that work. It was not part of my regular responsibilities, but I happened to be on duty when what was potentially a massive incident or series of incidents occurred. I, with my colleagues, moved heaven and earth in order to mitigate that threat. The security agencies had a wide range of tools, which they worked on and they used, in order to mitigate that threat.

I find it absolutely repugnant that this Minister in the chair, the Minister for Communications and Information Technology, who almost certainly has had no experience in that area at all, would reflect in that way on Labour members who think there should be some balance between privacy, the rights of companies, and security. Of course there should be some balance. Otherwise we have the Orwellian, the authoritarian, the Nazi, the Stalinist approach to security, and that is something that New Zealand absolutely rejects. This party believes that there should be balance. This party believes that if a case can be made by a security agency, then our party will take it seriously, and, if necessary, make amendments to the law. But what we have here is a relatively junior Minister who is telling us that we do not care about the security of New Zealand. Well, I say to that Minister: shame on you. What that Minister wants is the sort of blank-cheque approach, the sort of ministerial power to do anything to New Zealanders that she wants or that her colleague the Prime Minister wants in a way that is unacceptable in a democracy.

Look, I think my colleagues know and I certainly know that my Green friends feel that I am no bleeding heart liberal. I am not a bleeding heart liberal, but I do know that when authorities are being granted powers they should make the case. The Minister responsible for the GCSB, John Key, refused to let his schoolboy friend come to the Intelligence and Security Committee and justify what is in this legislation. I know that David Shearer, David Cunliffe, Phil Goff, Clare Curran, and other members of the committee would have listened carefully. In fact, almost certainly they would have agreed to have a secret session of the committee in order to be properly briefed so that they could understand. But what one suspects—what one suspects—is that no case can be made.

Certainly, I have doubts about whether the case can be made for the powers under Part 3 of this bill, which are, essentially, on the part of the Minister, unmitigated. What has to happen? What has to happen? The Prime Minister’s friend, whom he appointed without proper process, comes to him with a request. There is some doubt about it. The Prime Minister has to refer it to the commissioner. But who appoints the commissioner? Who oversees the commissioner? Whose responsibility is the commissioner? It is the Prime Minister. There is no check, there is no balance in this system, and, therefore, it is bad law.

Quite a few years ago—quite a few years ago, and the members who would remember it are certainly well gone from this House—in 1977 a relatively young protester was arrested upstairs because he thought that the powers that Sir Robert Muldoon was taking at the time under the SIS legislation in 1977 were unreasonable. That was me. In the end—[Interruption] What?

Andrew Little: There was the punk in Wanganui, but he blew himself up.

Hon TREVOR MALLARD: Well, I had a ponytail at the time, and Muldoon remembered it. But the point that I am making is that the powers that Muldoon was taking at that point had absolutely nothing on this: the ability to go into companies and require them to spend millions of dollars or even tens of millions of dollars in order to satisfy unproven—absolutely unproven—and unjustified arrangements that are required by a person who was appointed by the Prime Minister.

It is just wrong. It is just wrong that this Committee is passing this legislation and Government members are absolutely mute. They are absolutely mute. Not one single member of the Government benches has had the fortitude to stand up and support the Minister. Not one member of the Government thinks that this legislation is right and proper to the extent that they are prepared to stand up and say what they think and what they believe. Look at their heads go down. Look at their heads go down. They are ashamed. They are embarrassed because they know that the National Party of Jack Marshall, the National Party of Keith Holyoake, even the National Party of James Brendan Bolger would never pass this sort of illiberal attack on companies that want to work in New Zealand.

And what is worse, it is an uneven attack. If you happen to have a base in New Zealand and you provide services in New Zealand, you are punished, but if you are based offshore and you package something up and you sell it through Noel Leeming or The Warehouse, then you are not punished. The same requirements do not apply. Well, the Minister says no, but the legislation says yes. I do not—

Hon Amy Adams: No, it doesn’t.

Hon TREVOR MALLARD: Well, maybe, I do not know the Minister well enough. I actually used to have a high opinion of her. I thought when Hekia Parata was appointed to Cabinet that Hekia got there only because of her ethnicity and that if it was done on talent, then Amy Adams would have got there. Now I have got my doubts. Now I have got my doubts. This Minister is not showing any indication at all—not showing any indication at all—of actually reading her legislation and explaining it enough to any one of the mutes opposite to the extent that they could support her.

And what are we saying there? We have got a number of members—there is one called McKelvie, there is one from Hamilton East, there is one from Marlborough, there is one from Rotorua, there is one from Botany or some area, Craig Foss, Tony Ryall—but none of them understand the legislation well enough to take a call on it. You know, actually it is not that complicated legislation. It has got some weight to it, but it is pretty easy to read and it is pretty easy to understand. Anyone who has had a bit of experience in Parliament—

CAROL BEAUMONT (Labour): Fakalofa lahi atu. I want to pick up from that very good contribution made by my colleague the Hon Trevor Mallard. I think that people listening to this debate will hopefully have got the seriousness of what we are talking about here tonight. We are speaking at the moment about Part 3 of the Telecommunications (Interception Capability and Security) Bill. This part, clauses 43 to 54A, relates to network security. It is supposedly around preventing, mitigating, or removing security risks arising from public telecommunications networks and interconnections between those networks.

As many of my colleagues have said, our concern is not that we do not deal with potential security risks. We know that we need to do that, and we know that that legislation does need to be updated, particularly to take account of the changing nature of technology. We understand all of that, and we are not opposed, as some have been trying to say, including the Minister in the chair, the Minister for Communications and Information Technology, to being aware of security risks. What we want, though, is to ensure that that is balanced with the rights of New Zealanders to privacy, and that there are controls on the power that is being given to the Minister in particular under this legislation. We believe absolutely that this bill does not provide that balance, and that this Telecommunications (Interception Capability and Security) Bill is the bill that, effectively, implements the provisions of the Government Communications Security Bureau legislation. That is something that New Zealanders are deeply troubled about, and they should be.

In Part 3 we basically have a situation where in the description itself from the Law and Order Committee we have got it noted that, as introduced, aspects of this part were not clear or were too broad. That is what it says. There have been some changes made, clearly, as it has been reported back from the select committee, but the question I ask myself, having not been involved in that select committee, is how confident we can be that those changes have actually addressed all of the areas that are not clear or are too broad. Well, I have to say that I think that the select committee cannot have done that. When you look at the powers of the Minister responsible for the GCSB to make directions under clause 54 of the bill, and when you look at the fact that there is provision for continuing regulations to add to the lists of areas of specified security interests, which are listed in clause 46, then you have to ask yourself whether there is sufficient protection here.

I want to commend my colleague Clare Curran, who has done enormous work on this bill and who has got Supplementary Order Paper 370 on the Table around clauses 46, 47, and 48. Basically, the Supplementary Order Paper that she has put up would limit the network operators to which these sections apply to a class of network operators positively identified, rather than have blanket coverage of all network providers, from which exemptions may be sought. That then leads to clause 48 being deleted, as it relates to exemptions and is redundant, as the presumption with the amendments to clauses 46 and 47 I have just referred is for a specific inclusion, rather than blanket coverage. I think that that Supplementary Order Paper is very worthy and should be considered.

I do find it fascinating that we have members opposite all sitting there, talking to each other, reading something, heads down, doing whatever it is they are doing across the Chamber, and not engaging with this legislation. Why is it that those members opposite are not addressing the concerns that we are raising? These are significant questions in a democracy, and you would expect that members of Parliament, who are here to serve democracy, would want to comment on these things. If you disagree—sorry, if members opposite disagree, because I know that the Chair is deeply troubled by this as well—if members opposite are concerned about this democracy and concerned about the issues that we are raising, then get to your feet and tell us what you think about this legislation and why the issues we are raising are incorrect. I think that you actually cannot do that. I think that what you are doing is allowing—

Hon MARYAN STREET (Labour): I have been biding my time, waiting to contribute to this third part of the Telecommunications (Interception Capability and Security) Bill. There are things that are profoundly and deeply troubling about this. Although I do not know all of the technical ins and outs of the information and communications technology industry, I do know about issues of accountability and I do know about issues of responsibility from a Government towards its people.

I want to draw attention to clause 44 in Part 3, which is what we are talking about at the moment. This is where the truth comes home—this is where the truth comes home. Clause 44 is simply the definition of “Minister”. One would think that that would be inconsequential, but no, because it says: “In this Part, unless the context otherwise requires,”—which it never does, actually—“‘Minister’ means the Minister responsible for the Government Communications Security Bureau.” Here we have the intersection, the absolute nub, of Labour’s opposition to this bill. This is the vehicle for the delivery of the Government Communications Security Bureau Act. This is the delivery mechanism.

I want to go to some of the points in this part of the bill that delineate the responsibilities and the powers that have been given to this Minister, who is usually the Prime Minister. What we have here, repeated throughout this section, whether it is clause 46, clause 47, or clause 48, is an absolute reliance on the Minister and the Director of the Government Communications Security Bureau, who answers to the Prime Minister, the Minister responsible, for powers that have no check and balance. Members opposite may wonder why this side of the House is getting so agitated about this bill, and it is because there is insufficient regard paid to the rights of citizens in this country, the rights to privacy, the rights to security, certainly, but also the rights to be able to check on the power of the executive.

I want to talk a bit of technical language to the Minister now in the chair and ask him about certain things that appear in clause 48, which says: “The Director may, by written notice, exempt a network operator or a class of network operators from any of the requirements in section 45(1) or 47 if the Director is satisfied that the matter to which the exemption relates will not give rise to a network security risk.” So the Director of the Government Communications Security Bureau can exempt anybody if they think there is no security risk. Here we have this Government’s attitude towards citizens’ rights encapsulated—this Government’s attitude towards citizens’ rights. “We will make a decision about what is safe for you. We will give powers”—discretionary powers—“to people who have no accountability and for whom there is no comeback for the people of New Zealand.”

I want to draw that point out because I would like to ask the Minister in the chair whether clause 48—which is an exemption from clause 47, so please go back and have a look at the previous one, Minister—is a disallowable instrument. Tell me, is it a disallowable instrument? In other words, is it a regulation? Does it come before anybody for scrutiny? The answer, Minister, in case you are wondering—allow me to help you—is comprised of two letters and not three. The answer is no. It is not a disallowable instrument. All right, well, the Minister might then say: “Well, that is as it should be. Hard decisions have to be made here and the Government has to make them with all the information it has at its disposal and we will not have any check or balance. We will not have any scrutiny. We will not have any transparency. We will not have any appeal rights. We will not have any accountability over this.” [Bell rung] Mr Chairman, I have only just started. It is my only contribution.

Then we get to clause 54. Well, let us have a look at clause 54. It says the Minister may make a direction. The Minister may make a direction, and the Minister makes that direction if matters have been referred to him—let us say “him”, in this instance, being the Prime Minister we have currently—under a previous section, which details referral rights. Then it says: “the Minister has considered any submissions from the network operator.”—all right, that is not so bad—and “the Minister is satisfied that exercising his or her powers under this section is necessary to prevent, sufficiently mitigate, or remove a significant network security risk.” So the Minister is going to be responsible for determining where the security risk lies and whether or not there is a security risk caused by this.

This bill is silent, Minister Foss, unless you can prove otherwise to me—and I hope that paper you are looking at is something to do with this, because that Minister is the Minister in the chair and I would like him to answer these questions. As I read it, the bill is silent as to whether the instruments are disallowable for the purposes of the disallowance legislation. There is an argument that if it is appropriate for Orders in Council to be both disallowable and legislative instruments, then it is also appropriate for the powers to make ministerial directions to be subject to the same level of scrutiny and accountability. I do not even know whether the Minister understands what I am saying. The powers to make ministerial directions are the same as Orders in Council.

Orders in Council are disallowable instruments or legislative instruments—usually legislative instruments—but they are subject to scrutiny. They are subject to scrutiny by the Regulations Review Committee, whether they are disallowable instruments or legislative instruments. But this bill does not say whether any of this is subject to scrutiny. It is inconsistent for this bill to take upon itself rights and powers that may disempower the ordinary citizens of New Zealand from appeal, from knowing why the Government has made that decision, or for calling the Government to account.

The powers to make ministerial directions could be applied to the same effect as the powers to make Orders in Council, by making a number of ministerial directions, each of which applies to a different entity. So it is entirely possible that the Minister can say that this network is not a security risk and this one is, and there is no comeback. There is no comeback for those customers of that particular network that has been declared a security risk, whether it is Google or whatever it is—the network that New Zealand citizens subscribe to and use for their internet access and for information—regarding whether that is a security risk, and therefore whether they are susceptible to being cut off as a result.

This bill does not provide any democratic protection. It lodges responsibility and powers entirely with the Prime Minister. That, in the current circumstances, does not give me any cause for confidence, but it does not matter. Even if he was the best Prime Minister in the world—which he is not, but even if he were—I would still not agree with him being given those powers without transparency, without accountability, and without any right of appeal.

This is not balanced. This legislation does not take into account the rights and requirements of citizens not only to security, which we support, but also to privacy and to the transparency and accountability of a Government. On all counts this bill fails, and that Government does not understand it. New Zealand is not a company to be run like a chief executive officer would run any company. This is a country and it should be run differently from the way one runs a company. I have to say to those members opposite that “there are more things in heaven and earth, Horatio, than are dreamt of in your philosophy.”

STEFFAN BROWNING (Green): I rise to speak to Part 3 of the Telecommunications (Interception Capability and Security) Bill. Part 3 is on network security. Of course, in this modern age we are all very, very aware of the need for good network security. If this bill had that in it in what we might say is a fair manner, we would probably be supporting that aspect of it. We cannot. As I have said many times, we still need that full and thorough investigation, that independent investigation, and the Greens will push for that consistently until it happens.

With the Supplementary Order Paper 366 from the Minister for Communications and Information Technology as well, which is addressing part of the network security, the officials and also the Minister said there was an intention to refine the matters that must be notified to the Government Communications Security Bureau (GSCB), reducing compliance requirements for network operators. When I look at it all I can see is that it actually broadens it. I think the refinement is in making sure that there is nothing missing, that there is no way that anything would be missed. Sure, it might reduce some compliance requirements, but they have broadened it in some respects as well.

I asked them and I asked the Minister about clause 47 and her amendment replacing the old clause 47(1)(a) with a new bit. There is some wording that relates to architecture. Proposed new clause 47(1) states: “(b) any change—(i) to the architecture of any equipment, system, or service that falls within an area of specified security interest;”. What I would like to know is what the definition of “architecture” is. I can look it up. I can look it up in any dictionary, on Wikipedia, or somewhere, and of course we have got the standard definitions around building, or whatever, but basically it is about systems, or whatever. I am assuming that is what they mean—that is, it is the systems, the structure, of how a network might work. But I think they have been remiss in not spelling that out—talking of refinement—and getting it properly refined, and not giving us that definition and being absolutely confident about what is intended in that change. Maybe the Minister still wants to sort that out, because the Minister still has the capability to do that.

Under Part 3 of the bill a network operator must engage with the GCSB as soon as practicable after becoming aware of a proposed decision, course of action, or change, not necessarily related to their own network or service, that if implemented may raise a network security risk. That is pretty broad. We have all suffered some levels of risk through hacking or viruses, and sometimes we just think Government spam might be part of the problem too. We accept that there is that element of risk, and we would like to see this tuned in an appropriate way.

But I share, and the Green Party shares, the concerns that our fellows in Labour have expressed in the powers in here. Who has got the power? Well, we know who has got the power: the Minister responsible for the GCSB—generally the Prime Minister. I will talk about that once again in a moment. But as part of this network security there is a fair bit of scope in the areas of specified security interest, which can be expanded by Order in Council and by regulation, subject to consultations with registered network operators and some limitations, I must say, relating to changes in the technology.

COLIN KING (National—Kaikōura): I move, That the question be now put.

ANDREW LITTLE (Labour): It is always a great pleasure, of course, not only to take a call on an important piece of legislation such as this, the Telecommunications (Interception Capability and Security) Bill, but to do so under your chairpersonship, because this Committee needs a good and steady hand when it is considering erosions of, and invasions into, the personal security and privacy of its citizens.

This legislation is very important legislation, which is why it is such a surprise to members on this side of the Chamber that not a single Government member tonight, apart from the Minister for Communications and Information Technology, who made a contribution earlier, has seen fit to take a call on this fundamentally important piece of legislation. It marks a continuing process we have seen under this Government, unfortunately, of diminishing and eroding important citizens’ rights: the inherent right to privacy and the inherent right to be protected from the invasion into our personal space and our personal information at the very least by the State, because we know that the State is very powerful.

Of course, the powers in Part 3 of the Telecommunications (Interception Capability and Security) Bill are about not just private citizens’ rights and privacy but also those of the telecommunications companies to whom citizens subscribe for their telecommunications services. When you look at, for example, the obligation in clause 45, it imposes—in my view, disingenuously—a duty to engage in good faith with the director of the Government Communications Security Bureau (GCSB), with no corresponding duty on the director. That tells you what this Government is about: a lack of balance; a lack of understanding of the importance of citizens’ rights; and growing, almost total power of the State over citizens in important areas.

You know, there have been members of the Stasi and there have been members of the old Soviet Union Politburo—many of whom looked a lot like Tim Macindoe, funnily enough—who would be proud of the powers in this legislation. They would be very pleased about what has been achieved here. We all thought after 1990 that those evil, vicious days had gone. Well, they have been resurrected. They have come to life under the New Zealand National Government of 2008 to 2014. Fortunately, we know that it is all coming to an end—but I get off the point just for a moment.

The powers contained in Part 3 of this bill are invasive, and there are no corresponding duties on the director of the GCSB when considering his right—as Maryan Street pointed out, the director of the GCSB is a “his” at the moment—and no corresponding duties on the director of the GCSB in the way he conducts himself and these powers. There is a broad definition of “network operator” because that is not just the telecommunications companies; it is anybody who supplies to them. There is a broad definition of “security interest”, and that includes aggregated information about subscribers and users. That is frightful. Just when we thought, actually, that this Government understood that there are serious issues about access to aggregated information under the GCSB legislation, here we have that yet again in this piece of legislation.

We have the “Henry VIII” power still contained in clause 46(2), which allows a change to parts of clause 46(1), which ought to be regarded as unusual and, indeed, extraordinary.

Then we come to clause 47 and the extraordinary powers of the director not only to know about what telecommunications companies are doing but to direct them, and then, if the director of the GCSB is not happy with them, to go through the “telling on you to the teacher” process if he is not satisfied with the information being provided by the telecommunications provider. Even Supplementary Order Paper 366, providing a shimmer of a check and balance by requiring going via the chap who is in charge of the warrants, the Commissioner of Security Warrants, before going to the Minister responsible for the GCSB, is no check and balance on this power at all. It just confirms yet again the extraordinary and insidious powers that this Government is reserving for itself.

IAN McKELVIE (National—Rangitīkei): I move, That the question be now put.

ANDREW LITTLE (Labour): That was a temporary hiatus in my contribution, and I will take one moment just to collect my thoughts because they were many and varied, and in that brief pause there they have been scattered throughout my headspace, which is coming to terms with what I was saying just before.

We were up to clause 47 and we were talking about these extraordinary powers and the lack of check and balance provided by the Supplementary Order Paper of the Minister for Communications and Information Technology, which is why we actually need to ditch the Minister’s Supplementary Order Paper and, indeed, why we prefer Clare Curran’s Supplementary Order Paper 370, which provides an appropriate check and balance on these powers.

This confirms the point I was making before, which is that we should never in this House—a House of the citizens of New Zealand; a House of democracy; a House of Representatives built on the principles of freedom, of citizens’ rights, of a thriving community, and of a thriving country where we respect each other and where we respect each other’s personal space and personal lives—let a power that is as extraordinary, and, I would argue, as extreme as this, slip through this House with nary a comment. It is bad enough that not a single member opposite will talk about these extraordinary powers, will defend the need for this, or will talk about why this Government needs to pass legislation that makes even more encroachments on people’s personal information and personal rights and freedoms. We do not hear from the Government, and it is left up to members of the Opposition to have to draw the public’s attention to exactly what is happening here.

The day that a senior public servant, under the control and direction of a Minister and the Prime Minister, should be able to direct privately owned companies on informing the director—the public servant—and the Minister about the equipment that they are using, about when they are going to use that equipment, about when they are thinking about replacing that equipment, about when they are thinking about how the equipment is going to be used, and about when they are going through all those processes, and should be able to require the private company, whether it has got public shareholders or not, to keep the Government notified of those otherwise commercially sensitive and private decisions, is an extraordinary development in the creation of statute law in this country. We should not only stand here and remark on it but condemn it, and we do, and I do.

I say that there is simply no call for that, even in a country concerned about the security of its citizens and concerned about the security of its sovereignty and its nationhood, as many members of this House are—but, of course, those members supporting the Trans-Pacific Partnership agreement may take a different view because that constitutes an erosion of sovereignty. Even for those people who are concerned about this nation’s security, there is no justification for the erosions of civil liberties, civil rights, and personal privacy and personal information that this legislation represents. I simply make the point that there is no cause for this, and that we can achieve a proper balance between the nation’s security and the right of both companies and citizens to go about their lawful business, including that part of their business and their personal affairs conducted in private, without this sort of erosion. We must draw a line in the sand at some point and say that privacy—personal privacy, personal security, and personal space—must actually be given priority when it comes to passing these laws, especially when the idea of national security is called in aid to justify the ever-greater erosions of personal security, personal privacy, and personal space. It is time to put the flag up and say “Enough is enough. Enough is enough.”

I know that members of the Law and Order Committee, who looked at the bill, worked very hard to try to make some sense of it and to try to get some reasonable changes, but this Government is hell-bent on driving it through and diminishing for all time those basic personal rights and citizens’ rights. That is wrong, and it will change. It will change on a change of Government. In the meantime we stand utterly opposed to this—

TIM MACINDOE (Junior Whip—National): I move, That the question be now put.

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

Ayes 63

New Zealand National 59; Māori Party 2; ACT New Zealand 1; United Future 1.

Noes 56

New Zealand Labour 33; Green Party 14; New Zealand First 7; Mana 1; Independent: Horan.

Motion agreed to.

The question was put that the amendments set out on Supplementary Order Paper 366 in the name of the Hon Amy Adams to Part 3 be agreed to.

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

Ayes 61

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

Noes 58

New Zealand Labour 33; Green Party 14; New Zealand First 7; Māori Party 2; Mana 1; Independent: Horan.

Amendments agreed to.

The question was put that the amendments set out on Supplementary Order Paper 370 in the name of Clare Curran to clauses 46 and 47 be agreed to.

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

Ayes 56

New Zealand Labour 33; Green Party 14; New Zealand First 7; Mana 1; Independent: Horan.

Noes 63

New Zealand National 59; Māori Party 2; ACT New Zealand 1; United Future 1.

Amendments not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 370 in the name of Clare Curran to clause 48 be agreed to.

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

Ayes 56

New Zealand Labour 33; Green Party 14; New Zealand First 7; Mana 1; Independent: Horan.

Noes 63

New Zealand National 59; Māori Party 2; ACT New Zealand 1; United Future 1.

Amendment not agreed to.

A party vote was called for on the question, That Part 3 as amended be agreed to.

Ayes 61

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

Noes 58

New Zealand Labour 33; Green Party 14; New Zealand First 7; Māori Party 2; Mana 1; Independent: Horan.

Part 3 as amended agreed to.

Part 4 Registration, enforcement, and miscellaneous provisions

The CHAIRPERSON (H V Ross Robertson): The question now is that Part 4, which is debate on clauses 55 to 110 and the schedule, stand part. But, having said that, it is now 5 to 10, and it is the time when I need to report progress to the House.

Progress reported.

Report adopted.

The House adjourned at 9.56 p.m.