Tuesday, 16 June 2015

TUESDAY, 16 JUNE 2015

TUESDAY, 16 JUNE 2015

Mr Speaker took the Chair at 2 p.m.

Prayers.

Visitors

Iran—National Security and Foreign Policy Committee

Mr SPEAKER: Honourable members, I am sure that members would wish to welcome the parliamentary delegation from the National Security and Foreign Policy Committee of the Islamic Parliament of Iran, who are present in the gallery.

Motions

Magna Carta—800th Anniversary

DAVID SEYMOUR (Leader—ACT): I seek leave to move a motion without notice to mark the 800th anniversary of the Magna Carta.

Mr SPEAKER: Can I just clarify with the member that this is a debatable motion that the member is proposing?

DAVID SEYMOUR: Yes.

Mr SPEAKER: I will put the leave. Is there any objection to that course of action being followed? There is none.

DAVID SEYMOUR: I move, That this House note the 800th anniversary of the Magna Carta, a document which Lord Denning described as “the greatest constitutional document of all times—the foundation of the freedom of the individual against the arbitrary authority of the despot”, and which established the notion that the law is not simply the whim of the King or of Government, and that all are equal under the law and can be held to account; and thus that the Magna Carta represents the foundation of the rights and freedoms which we enjoy today. This month we celebrate the 800th anniversary of the Magna Carta. It is a document that reminds us of the long and rich tradition of individual freedoms and legal rights that we enjoy. That tradition stretches back to the 13th century in Britain, not just back to 1840. Indeed, the Magna Carta itself was indebted to the earlier coronation charter of Henry I in 1100, a charter that was then ignored for a century.

The Magna Carta itself was initially ignored and belittled. It was even annulled by Pope Innocent III—

Hon Member: Read it out.

Hon Member: A bit like your coalition agreement.

DAVID SEYMOUR: —I can make it longer—but with much struggle it eventually achieved traction and acquired a heritage and symbolic force. Magna Carta, which in Latin means “great charter”, paved the road to modern democracy. It can be thought of as representing the seed from which have grown many of the principles on which our democracy is based. Meeting in June 1215, feudal barons gathered outside London to define the limit of the powers of King John, forcing him to affix his seal to the charter. This charter was narrow in scope. It concerned the medieval relationship between the monarch and the barons, rather than the rights of ordinary people at that time. But over time that principle was extended. It planted the seed of an idea that was extended and then generalised. Ultimately, and with great struggle, because rulers do not easily give up their powers, it granted every citizen individual freedoms, laying the foundation for constitutional rights and for this House and our Parliament.

The United States Constitution and United States Bill of Rights were both based upon principles laid out in the charter. It was used by Thomas Jefferson when he established the Declaration of Independence. The violations of English common law in the American colonies by King George were what provided Jefferson with ample argument in writing his Declaration of Independence from that monarchy. The Fifth Amendment of the United States Constitution, saying that no citizen may be deprived of life, liberty, and the pursuit of happiness, echoes the centuries-old Magna Carta resolutions.

The charter was the first document declaring that the king or queen had to abide by the laws of the land, and in the modern context it requires that our rulers—temporary as they may be—must operate within those laws of the land. Thus, Magna Carta has come to symbolise the principle that everybody is subject to the law and that nobody, not even a king or queen, is above it. It is a symbol of liberty. At the time of the 800th anniversary of the signing of Magna Carta it is therefore fitting that this Parliament mark this anniversary, remember our political past, and work to build on those liberties so painfully acquired over the eight centuries since the signing of Magna Carta. Thank you.

Hon CHRISTOPHER FINLAYSON (Attorney-General): I have drawn the short straw to respond. Yesterday was the 800th anniversary of the sealing of Magna Carta. I say, for Mr Robertson’s benefit, that it was sealed, not signed. We had a function in the Grand Hall attended by you, Mr Speaker, and the Leader of the Opposition, Mr Parker, Dr Graham, and several other members of Parliament.

In my speech I mentioned the comments of UK Supreme Court judge Lord Sumption, who began his recent address to the Friends of the British Library by saying “It is impossible to say anything new about Magna Carta, unless you say something mad. In fact, even if you say something mad, the likelihood is that it will have been said before, probably quite recently.”, so I look forward to Mr Peters’ contribution. His comments reflect two opposing points: first, that the role of Magna Carta is frequently misunderstood, and, second, that its role is of such importance that few documents have been more influential to countries like our own. What we can say for certain is that Magna Carta has come to symbolise the enduring values and principles that guide our society today—values such as freedom of religion, the right to justice, and human rights. Only one section remains in force today. Much of the original text dealt with grievances specific to that time, and almost all of the 63 clauses have been repealed. Nearly a third were deleted or amended only 10 years after it was first sealed.

But the sole section that remains in force is one of the most important: “No Freeman shall be taken or imprisoned, or be disseised of his Freehold, or Liberties, or free Customs, or be outlawed, or exiled, or any other wise destroyed; nor will We not pass upon him, nor condemn him, but by lawful judgment of his Peers, or by the Law of the Land. We will sell to no man, we will not deny or defer to any man either Justice or Right.” This section is powerful in its symbolism of the rule of law, and that is Magna Carta’s most vital role today. It may not have been the original source of the principle, but it certainly today embodies the idea that everyone is equal and accountable to the same standard under the same law. We should be very proud that our country is built on the foundations of this tradition.

Hon DAVID PARKER (Labour): I add to the acclamation that has been given to the “great charter”, which is the translation of the words “Magna Carta”—it means the great charter. I do think the words that the Attorney-General just read out, which is the only paragraph that remains in our law, put into the Imperial Laws Application Act 1988, means that this clause does remain in place. The effect of this is that all men and women remain equal before the law and due process shall apply. I think the words are worthy of reading again. I know the Attorney-General has just read them out, but they say: “No Freeman shall be taken or imprisoned, or be disseised of his Freehold, or Liberties, or free Customs, or be outlawed, or exiled, or any other wise destroyed; nor will We not pass upon him, nor condemn him, but by lawful judgment of his Peers, or by the Law of the Land. We will sell to no man, we will not deny or defer to any man either Justice or Right.”

Even those words have been largely modified by the particular statutes that we have in New Zealand that guarantee justice to people. I think, really, that what we are left with is what another great Australian jurist Dennis Denuto said to the High Court of Australia. He said: “It’s in the vibe of the thing.” And it really is. It really is. It is an important and enduring vibe of the thing, and indeed I can remember in this House the Magna Carta being referred to in respect of the claims of injustice caused by the foreshore and seabed legislation’s first iteration. So it is a document that has an enduring legal and political legacy, and it seems to me that it stands alongside the Treaty of Waitangi in New Zealand in that although not all parts of it are directly in our law—and it is the same with the Treaty of Waitangi; it is not part of our statute law—it does have an enduring political and legal influence upon our country, and, in both the case of the Magna Carta and the Treaty of Waitangi, that is a good thing.

I end by saying that I think that through the traditions that we have in democratic countries that have justice systems that are based upon the principles that were expressed in the likes of the Magna Carta and the 1688 Bill of Rights, we manage to have enduring, fair societies that are wealthier, that look after the rights of minorities, and that, as a consequence, are more peaceful and happy places to live. I am happy to be part of the celebration of the 800th year of the sealing of the Magna Carta.

EUGENIE SAGE (Green): The Green Party supports the recognition of the 800th anniversary of the sealing of the Magna Carta in that meadow, the Runnymede, beside the Thames River, but we recognise Te Tiriti o Waitangi as our most important constitutional document. Nevertheless, the Magna Carta has been an important foundation stone of our democracy, because it essentially did three things: it established that no one was above the law, not even the king; it established that there was a right to a free trial; and it established that no one should be imprisoned arbitrarily by the State. It also established that people who are taxed should have some kind of representation.

We honour the Magna Carta, but we do not always recognise its practical implementation under this Government. We have, in Environment Canterbury, Cantabrians having been taxed and rated for the last 5 years, but having had no elected representation around the council table to determine how $80 million in rates, which are collected annually, should be spent. So we honour the Magna Carta, but the Government needs to actually recognise it. With its proposals to gut the Resource Management Act, we think that some of the principles that are there in the Magna Carta should be expanded: that the rights to nature now need more explicit recognition in our law, not weakening as this Government is proposing to do.

Mr SPEAKER: The Rt Hon Winston Peters.

Hon Gerry Brownlee: An eyewitness.

Rt Hon WINSTON PETERS (Leader—NZ First): There is nothing like envy. Of course, today some would say that we have some people in this House—one with the name of John, the other with the name of Chris—who assume kingly powers. It is also without a hint of irony that the motion is in the name of one David Seymour, an earnest young fellow who lavishes praise on a document that is the oldest legislation on our statute book. Magna Carta has inspired people from those who fought in the English Civil War to the suffragettes, yet he has his seat due to political largesse and a constitutional rort. And, for my friend Mr Finlayson’s benefit, let us remind the House and the public of this country that it is his and the National Party’s Judicature Modernisation Bill currently before the House that deletes the declaration as to parliamentary sovereignty and the rule of law, which is in the Supreme Court Act 2003—just to put things in legal perspective for the doyen of the legal fraternity in this House and apparently around the whole Commonwealth.

Now, although it is a document signed in medieval England between the barons and the king, it is no exaggeration to suggest that Magna Carta forms the foundation stone of the freedoms and liberties we now enjoy in New Zealand. It is one of the most important documents in history, as it establishes the principles, as others said, that no one is above the rule of law—even, might I add across the House, the rulers. The charter gave individuals the right to justice and the right to a fair trial. The ideas rooted in Magna Carta have formed the basis of freedoms and liberties we now enjoy in our modern democracy.

Now, New Zealand First is a political party, and we get a bit tremulous only when we see what members over there are capable of doing with this magnificent document. New Zealand First is a political party committed to a strong and dynamic democracy in New Zealand. We are for vigilance in standing against any changes that undermine or weaken our democracy, and we urge all New Zealanders to value our democracy and to be vigilant in safeguarding our democratic heritage.

MARAMA FOX (Co-Leader—Māori Party): I did not draw the short straw; I lost the game of paper, rock, and scissors. But I stand with the House to commemorate the 800th anniversary of the granting of the Magna Carta in 1215—the significant document from 800 years ago, as of yesterday. Eight hundred years have passed since the granting of the Magna Carta and the brokered peace between King John and the rebel barons. Eight hundred years have passed since the first steps towards a commitment to basic human rights, first provided for and recognised by the Crown. However, 800 years later we know there are still improvements to be made in ensuring that the word and rule of law is applied equally and indiscriminately and is treated with greatness and respect.

The Magna Carta was the result of a rebellion against the arbitrary abuse of authority by the monarch. Many might point to the establishment of the Māori Party as an act of rebellion, its being established to represent the power of the people whom we represent. The product of this stand is significant. It paved the way for other fundamental texts, such as the Writ of Habeas Corpus, the US Constitution, the UN Universal Declaration of Human Rights, and even our very own Treaty.

The Magna Carta sought to limit the unbridled power of King John, and we recognise that it is the foundation of our law. But we think that we should also recognise the place of the Treaty in our law. The quote that Mr Finlayson has already articulated I will repeat, for the benefit of the House: “No Freeman shall be seized or imprisoned or stripped of his rights or possessions or outlawed or exiled or deprived of his standing in any way; nor will we proceed with force against him or send others to do so, except by the lawful judgment of his equals or by the law of the land.”

I want to point to a few pieces of legislation that stood in this land: the Suppression of Rebellion Act, the Tohunga Suppression Act, and the Native Schools Act. Today we find contemporary examples of inequality, such as the establishment of the Māori seats, first done so to ring-fence the Māori vote. In fact, in this House you can get rid of a Māori seat by 50 percent of the vote, but for any other seat it would require 75 percent. That in itself needs to be addressed, in the interests of equality.

In reflecting on the quote that I used before, many issues have yet to be resolved. How do we recognise the principles of the Treaty of Waitangi, water rights, and Ngāti Whātua Ōrākei rights of first refusal? How do we honour the Treaty of Waitangi so that there is not a circumvention of our law? The quote is especially fitting when we consider these things alongside the Treaty. I think the last part is important: “… to no one deny or delay the rights of justice.” I stand proudly to represent the Māori Party in calling for a recognition of the principles in the spirit of the Magna Carta 800 years later. Kia ora.

Motion agreed to.

Oral Questions

Questions to Ministers

Economic Outlook—OECD 2014 Economic Survey

1Dr PARMJEET PARMAR (National) to the Minister of Finance: What reports has he received showing how New Zealand’s broad-based economic growth is leading most other OECD countries?

Hon BILL ENGLISH (Minister of Finance): Last week the OECD released its economic survey of New Zealand for 2014, reporting that New Zealand is enjoying strong, broad-based economic expansion. It points out that in recent years economic growth has been faster in New Zealand than in most other OECD countries, with strong fiscal and monetary policy frameworks, a healthy financial sector, and macroeconomic stability—all of these underpinning growth. It points out that employment is high and business investment robust but that there are bottlenecks in housing, urban infrastructure, and skills. But, as the OECD points out, the Government is moving to deal with these issues.

Dr Parmjeet Parmar: How is business investment and employment growth supporting higher wages?

Hon BILL ENGLISH: The OECD notes that New Zealand’s solid labour-market performance includes both higher labour-force participation and a higher employment rate—that is, the proportion of working-age New Zealanders actually in jobs is higher than in most other OECD countries. Treasury expects this to continue. Unemployment is forecast to drop below 5 percent in the next 2 years. By mid-2019 a further 150,000 people are forecast to be in work, and the average wage is expected to rise by $7,000 a year to $63,000 a year.

Dr Parmjeet Parmar: What does the OECD say are the main challenges to the economic outlook?

Hon BILL ENGLISH: It says that the main issues in achieving sustained economic growth are addressing shortages in skills, housing, and land transport infrastructure; limiting financial risks in housing; and ensuring that the Government’s finances remain sound. The Government is taking steps in every one of these areas.

Dr Parmjeet Parmar: What steps has the Government taken recently to strengthen New Zealand’s economic opportunities, particularly in Asia?

Hon BILL ENGLISH: Despite the OECD’s reasonably positive view of the New Zealand economy, the Government continues to look ahead for better economic opportunities. That is one of the reasons why we have agreed to become a founding member of the Asian Infrastructure Investment Bank, which is being established to invest in new infrastructure across Asia. This will, of course, enhance the Asian region’s growth, and that will be good for New Zealand. New Zealand was the first Western developed nation to join negotiations to set up the bank, and our membership will enhance our already strong trade and investment links in Asia.

Housing New Zealand—Condition of Properties and Health of Tenants

2. METIRIA TUREI (Co-Leader—Green) to the Minister responsible for HNZC: Does he accept the coroner’s finding that the Housing New Zealand home in which Emma-Lita Bourne lived may have contributed to the pneumonia-like illness that Emma-Lita was suffering at the time of her death?

Hon BILL ENGLISH (Minister responsible for HNZC): First of all, I would like to extend my sympathies to the family of Emma-Lita Bourne. If there were steps that could have been taken to prevent this tragedy, I am sure that all concerned would have taken them. I accept the coroner’s actual statements on the matter: “It is entirely possible the condition of the house had contributed to the pneumonia-like illness that Emma-Lita was suffering at the time of her death.” And further: “Whether the cold living conditions of the house became a contributing factor to the circumstances of Emma-Lita’s death cannot be excluded.” The coroner commented also on the unusual medical aspects of this tragic death.

Metiria Turei: How does the Minister reconcile Nick Smith’s statement that there is nothing new about people dying from pneumonia in winter and the Government cannot do anything about it with Housing New Zealand’s admission that it failed Emma-Lita and the coroner’s ruling that her house could have contributed to her death?

Hon BILL ENGLISH: I do not accept the member’s version of Dr Smith’s statement, which has been taken quite out of context. In respect of the other issues that the member raises, Housing New Zealand has demonstrated that it took a number of steps to improve the condition of that house—just as it has spent hundreds of millions of dollars on other houses. It does indicate, though, that further change is required in our State housing system to ensure that we do have a wide range of suitable and appropriate-standard housing available to New Zealanders who need it.

Metiria Turei: Does the Minister agree then with Nick Smith when he gave up and said that there is nothing the Government can do to stop people from State houses dying, when Soesa Tovo’s family and his doctors begged Housing New Zealand to move his family into a warmer, drier home to help prevent his tragic death?

Hon BILL ENGLISH: I disagree with both the assertions—that is, about what Dr Smith said and about the actions that were taken around the Soesa Tovo family. But, again, I think it underlines—as the member may now understand—that, to the extent that housing has an influence on the health of these families, we must change the State housing system, which has left us with houses that are still not up to the standard required, despite hundreds of millions of dollars of expenditure.

Metiria Turei: Does the Minister agree with Duncan Garner that Nick Smith’s saying that it is normal for people like Emma-Lita and father of six Soesa Tovo to die in winter is a callous statement and amounts to neglect?

Hon BILL ENGLISH: No, that is not what the Minister said, and if Duncan Garner described it that way, then he was incorrect. However, we are used to misrepresentation from that member.

Metiria Turei: Will the Minister commit today to ensuring that all Housing New Zealand homes that cannot be fully insulated, like Emma-Lita’s, are fitted with carpet, thermal curtains, and dehumidifiers now, this winter, to help prevent further deaths like Emma-Lita’s?

Hon BILL ENGLISH: Certainly, I can commit to all public services involved with these families taking the steps that they ought to take to prevent as tragic an outcome as a death. I might say that in the case of the family that the member is referring to, there are a range of issues, of which housing was just one, which suggest that we could have done—the Government could have done, the community could have done—a better job to support the health of that family. But I cannot, of course, make impractical undertakings about everything being done right now, when we are dealing with housing stock with an accumulation of 60 or 70 years of problems, partly because of the point of view taken by that member that no house can be sold or redeveloped.

Metiria Turei: I seek leave to table an unpublished written question showing that Housing New Zealand does not supply dehumidifiers to State homes.

Mr SPEAKER: Sorry, can I just understand what leave is being sought for?

Metiria Turei: It is leave to table an unpublished written answer to a written question that I have received, which says that Housing New Zealand does not supply dehumidifiers to State houses.

Mr SPEAKER: It is unusual, but on the basis that the House can make the decision, I will put the leave. Leave is sought to table this particular at this stage unpublished written question. Is there any objection to that question being tabled? There is.

Metiria Turei: I seek leave to table an as yet unpublished answer.

Mr SPEAKER: Order! No. [Interruption] Order! I am not going to put the leave. That is a matter that has been raised once before. Again—if the member will resume her seat—the member is trying to use the point of order simply to reinforce a political point. That is not what it is designed for. The tabling of documents is about further informing members. Members will have that information when it is published after the 3 days.

Metiria Turei: How many tenants, like Soesa Tovo, have requested, on their doctors’ orders, transfers to healthier homes but are still living in cold, damp, unhealthy State houses; and if he does not know, why does he not know?

Hon BILL ENGLISH: I would have to go and get that information. Housing New Zealand has ways of collating its data. We cannot always tell you the exact reason why a tenant has asked for a transfer, but I might say that we would have more choices about houses to transfer tenants to if we were not fighting a legacy of Green-type policies that prevent the growth and development of a city like Auckland, enabling there to be more houses on the ground faster so that these families have somewhere to move to. Green-type policies are a big part of the problem here.

Metiria Turei: Smirking, Bill English.

Mr SPEAKER: Order! If the member is going to have the opportunity—[Interruption] Order! The member will now just ask her supplementary question.

Metiria Turei: Does the Government have any responsibility for ensuring that people with respiratory illnesses, like Emma-Lita or Mr Tovo, are not forced to sleep in bedrooms with vinyl tiles stuck to uninsulated concrete floors and with mould dripping down the walls, or does he agree with Dr Nick Smith that their deaths are simply nothing new?

Hon BILL ENGLISH: Again, I do not agree with the member’s characterisation of Dr Smith’s statements. Yes, of course a Government does have some responsibility—as do the tenants—but the Government is taking the responsibility very seriously. We are setting out for a generational renewal of the State housing stock, and we are trying to cast off the ridiculous policies—which that party has supported—that say that no State house can be sold because the ones built in the 1950s, to 1950s standards, are what we need now. That is a ridiculous position—

Rt Hon Winston Peters: I raise a point of order, Mr Speaker.

Hon BILL ENGLISH: —and we will continue to—

Mr SPEAKER: Order! I apologise to the Minister. I have a point of order.

Rt Hon Winston Peters: With respect, this is the second answer that that Minister has given, and, with the greatest of respect, it will be patently obvious to everybody that the Greens have not been in Government in the last 6½ years, so why is he persisting and being allowed to get away with that answer?

Mr SPEAKER: Order! He did not say that the Greens had been in Government. I think the words he used were that the Greens had supported a party that was in Government, as I recall.

Housing New Zealand—Condition of Properties and Health of Tenants

3. ANDREW LITTLE (Leader of the Opposition) to the Prime Minister: Is he satisfied with his Minister of Building and Housing’s handling of the issue of cold and damp rental properties, in light of his statement that “people dying in winter of pneumonia and other illnesses is not new”?

Rt Hon JOHN KEY (Prime Minister): Yes.

Andrew Little: Has he received a letter signed by over 21,000 New Zealanders calling for immediate cross-party action on this issue because Kiwi families should not have to go through more winters in cold, damp rentals that are killing people like toddler Emma-Lita Bourne?

Rt Hon JOHN KEY: Yes, and I could take it a little bit more seriously if it was not laced with fake names, including one Lindsay Tisch, who happens to be a National Party caucus member who did not sign the petition. By the way, here is the letter from the Labour Party apologising for getting it wrong—no better than the Greens just making up names—

Mr SPEAKER: Order! Supplementary question—[Interruption] Order! For the benefit of the Hon Todd McClay, when I rise—[Interruption] Order! If that Minister wishes to stay for his question, I would advise him to cooperate. When I stand on my feet, I expect members to then cease their interjections.

Andrew Little: Does he accept that with hundreds of thousands of Kiwis still living in cold, damp, and unhealthy rentals, more half-measures like insulation and fire alarms alone just will not cut it?

Rt Hon JOHN KEY: I accept there are both some rental properties and actually properties that people would own that are in a poor state of affairs. But I also acknowledge what this Government has done, which is to insulate every State house that practically can be insulated and to put together a Warm Up New Zealand: Heat Smart programme, which has insulated 240,000 homes. The truth is that this Government inherited Housing New Zealand stock that was a complete mess and run down by the previous Government.

Andrew Little: Given there are already 61 votes in this Parliament for Labour’s Healthy Homes Guarantee Bill, which will ensure that all rentals are insulated, heated, dry, and weathertight, will he accept my offer to work together to make all rentals warm and dry?

Rt Hon JOHN KEY: No, not in the legislation that the member is presenting, because I do not think it actually meets the bill. But in terms of what the Government is working on, if the member wants to work with the Government on its proposals, we look forward to working with him on them.

Mr SPEAKER: Supplementary question—[Interruption] Order! I have called for order. Andrew Little is asking a supplementary question.

Andrew Little: What exactly is the Prime Minister proposing that his Government puts together that we can work on that is going to make all rental homes warm and dry, rather than just insulated and with smoke alarms?

Rt Hon JOHN KEY: The Government has a range of initiatives and some more to be announced. But I will make this point: the member keeps talking about a warm home, and, yes, warmth clearly comes from insulation, but is the member really saying that it is now the responsibility of the landlord to actually physically turn on the heaters and pay for those for a tenant? That seems to be what the member is actually saying.

Andrew Little: I seek leave to have the Healthy Homes Guarantee Bill in my name set down as members’ order of the day No. 1.

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

Andrew Little: Why is he refusing Kiwis’ wish for Parliament to work as one to improve the lives of Kiwis who are living and dying in cold, damp homes?

Rt Hon JOHN KEY: As I said, the Government is going to have a range of initiatives, as well as things it has already announced, and we are more than happy to work with any Opposition party that wants to do that, but the bill that we have seen does not actually meet the mark. But I go back to the fundamental point: when we came into office after 9 years of a Labour Government, the Housing New Zealand stock was a mess. There was a fraction of the private homes in New Zealand that were insulated. The members can try to forget about all of that, but what it shows you is that in Government they were like little lamb chops. They roar like lions in Opposition, but it is very hard to take them seriously when they did absolutely nothing in Government.

Businesses, Christchurch—GreenHouse Hub and Research Funding

4. NUK KORAKO (National) to the Minister of Science and Innovation: How is the Government encouraging the development of innovative new businesses in Canterbury?

Hon STEVEN JOYCE (Minister of Science and Innovation): Last week I opened, on behalf of the Government, the new Christchurch GreenHouse hub to support new and emerging businesses in the Christchurch innovation precinct. The GreenHouse hub is a joint partnership between the Ministry for Business, Innovation and Employment and the Canterbury Development Corporation, and it is supporting early-stage entrepreneurs by providing the necessary technological and social infrastructure required for firms to grow. Early-stage businesses are the generators of new ideas, products, and services. The GreenHouse hub will help develop the next generation of New Zealand’s innovation firms, creating more investment, jobs, and growth in Christchurch.

Nuk Korako: Kia ora anō. Why will the new GreenHouse hub be located in the Christchurch innovation precinct?

Hon STEVEN JOYCE: Having start-ups located alongside larger, established firms provides an environment that encourages innovation and collaboration. Innovation precincts attract talented people, encourage interaction and creativity, and foster innovation. Already we have significant national and global players as key tenants in the innovation precinct. Vodafone, Kathmandu, and Wynyard Group amount to more than 600 staff alongside business support agencies, Callaghan Innovation, New Zealand Trade and Enterprise, and the information and communications technology graduate schools. Through projects like the Christchurch innovation precinct and through support of the Wynyard Quarter in Auckland and other developments like regional business partners in regions across New Zealand, the Government is helping business to innovate, grow, and succeed on the world stage.

Nuk Korako: What new research support is the Government giving to Christchurch?

Hon STEVEN JOYCE: There is a whole range of activity, and, of course, since the earthquake, there has been a lot of interest in the study of seismic activity and natural resilience. Last month I announced funding for four new centres of research excellence, including the new quake centre of research excellence, which is a centre for earthquake resilience based at the University of Canterbury. Yesterday I announced $3.2 million in funding for 13 new research programmes under the natural hazards research platform, including a number of proposals to apply the lessons learnt from the Christchurch earthquakes, including investigating the presence of hidden faults under urban areas and potential tsunamis from seismic activity.

Free-trade Agreements—Saudi Arabia Negotiations and Al-Khalaf Group

5. Rt Hon WINSTON PETERS (Leader—NZ First) to the Prime Minister: Does he stand by all his statements regarding the Saudi farm deal; if so, why?

Rt Hon JOHN KEY (Prime Minister): Yes, because I believe them to be correct.

Rt Hon Winston Peters: Does he stand by this statement, and I am quoting him: “there was also a great opportunity to promote what we were doing in terms of development of our agricultural credentials overseas.”?

Rt Hon JOHN KEY: Yes.

Rt Hon Winston Peters: Why was a Saudi Arabian - associated company allowed a tender where it could “follow its own procurement guidelines and procedures as long as these adhered to procurement principles of openness, transparency, fairness, accountability, due diligence, value for money, efficiency, and economy.”?

Rt Hon JOHN KEY: The advice I have had is that the procurement was handled professionally and according to guidelines.

Rt Hon Winston Peters: Is it not a fact that his Government has given funding commitments in excess of $22 million to Saudi Arabian - associated companies recently?

Rt Hon JOHN KEY: I certainly cannot confirm that number.

Rt Hon Winston Peters: Why has the Government allowed Saudi business interests, using New Zealand taxpayers’ dollars, to enter tender arrangements where Saudi-owned, not New Zealand - owned, companies are employed to do all the jobs?

Rt Hon JOHN KEY: I do not have those details. You would have to put them down for the Minister.

Rt Hon Winston Peters: Is it not a fact that this Government has entered commercial arrangements involving bribery, corruption, and jack-ups of the tender process?

Rt Hon JOHN KEY: In my experience, when you start calling names, you are losing the argument. That member has lost the argument. He should quit while he is behind.

Building and Housing, Minister—Confidence

ANDREW LITTLE (Leader of the Opposition): Thank you, Mr Speaker.

Hon Simon Bridges: Oh, not again.

ANDREW LITTLE: There is more where that came from.

Mr SPEAKER: Order!

6. ANDREW LITTLE (Leader of the Opposition) to the Prime Minister: Does he have confidence in his Minister for Building and Housing; if so, why?

Rt Hon JOHN KEY (Prime Minister): Yes.

Hon Members: Why?

Rt Hon JOHN KEY: Well, because he is getting on with the job of increasing the supply of housing, particularly in Auckland.

Andrew Little: When he said yesterday that there were no first right of refusal issues with the Crown land in Auckland, does he now accept that was wrong, and did he get that wrong because Nick Smith gave him bad advice?

Rt Hon JOHN KEY: No. You would have to look at the whole transcript. The point I was making in terms of the right of first refusal is that it is not triggered in Auckland when it comes to the Tāmaki Collective.

Andrew Little: Now that he has admitted that the 500 hectares of Auckland Crown land was a guesstimate and has also admitted that the four identified sites shown to journalists are only “conceptual”, how many actual houses will his Government be building for real families to live in?

Rt Hon JOHN KEY: In the last 12 months there have been 8,500, and I am confident that parcels of land will be identified as being on track by October of this year, and houses will be built by 2016.

Andrew Little: Can he confirm that this is the situation so far: firstly, the policy was leaked early; secondly, some of the land was occupied by power substations and cemeteries; thirdly, it turned out that the Government did not actually have the 500 hectares promised; fourthly, some of the land was not even owned by the Crown; fifthly, it turned out the Government could not sell the land without giving iwi first dibs; and, lastly, it turns out the Government has already given iwi first dibs to the land on Moire Road, and the whole thing is going to wind up in court?

Rt Hon JOHN KEY: No, but if I did visit the cemetery I know what I would find there: the Labour Party, because, according to its review, it is dead.

Mr SPEAKER: Order! That answer will not help the order of this House.

Andrew Little: Has he seen his Minister’s comments today blaming the failure of this policy on a reporter creating “enormous pressure” by asking too many questions; if so, can he confirm that the list of people he blames so far for this housing crisis is now Labour, first-home buyers, the council, officials, and TV3’s Brook Sabin—everybody but the Minister for Building and Housing?

Rt Hon JOHN KEY: No, but I do remember the Leader of the Opposition being in his job for less than a couple of months and starting to get all scratchy with the media.

Andrew Little: When Auckland house prices are going up by $19,000 in 1 month and the shortage of houses is getting worse every day on his watch, does he not think that Auckland families deserve more than the half-baked, last-minute fiascos that pass for a housing policy under this Minister?

Rt Hon JOHN KEY: Far from it. Let us establish the facts. House prices doubled under the previous Labour Government—doubled. House prices went up in Auckland faster than they are going up under a National Government. Under a National Government we have reformed the Resource Management Act and will continue to do so. Under a National Government we have identified special housing areas, and we are going to fix it. Under a National Government we have taken off the tariffs that are applying to imported goods. Under a National Government we will be releasing land. We are getting the job done, but the reason it is such a big job is that we inherited such a mess from people who, again, did absolutely nothing in Government.

Andrew Little: Is it his position, then, that his Minister for Building and Housing has the Auckland housing problem fully under control?

Rt Hon JOHN KEY: What I can say about the Minister for Building and Housing is that he is outstanding. [Interruption] There you go—do you want to clap? [Interruption]

Mr SPEAKER: Order! You have had your fun. We are now moving to question No. 7. [Interruption] Order! I have given a warning. It now needs to be taken seriously, otherwise one member in particular will be having a very early shower.

Housing, Auckland—Hobsonville Development and Consultation with Iwi

7. ALFRED NGARO (National) to the Minister for Building and Housing: How many new houses have been completed at Hobsonville Point, and how many more are now planned with the Government announcement to speed up the development?

Hon Dr NICK SMITH (Minister for Building and Housing): Four hundred homes in Hobsonville are completed and occupied, and a further 316 have been sold and are at various stages of construction. Saturday’s announcement brings forward 1,000 homes by 2 years in Buckley B, the village, and the apartment complex around the new Hobsonville Point Primary School. Of these 1,000 homes, 300 are priced as starter homes for first-home buyers.

Alfred Ngaro: When was the development in Hobsonville first announced, and what mechanisms were used legislatively to enable this former Defence Force base to be used for housing?

Hon Dr NICK SMITH: The plan to develop the ex - Defence Force land in Hobsonville as housing was announced in 2002. Interestingly, it was declared for housing purposes under the Housing Act, and Cabinet made a decision that it would not be offered for Treaty land banking or for offer-backs. By 2008 no infrastructure had been built and not a single house had been built. In fact, after those 6 years, not a single sod of soil had been turned. This project was mired in resource management and planning issues. With the use of these special housing areas, the project is now blossoming at pace.

Alfred Ngaro: What has been the relationship with local iwi on the Hobsonville project, and how has the Government ensured that Treaty settlements—right of first refusals—have been complied with?

Hon Dr NICK SMITH: This Government completed a Treaty settlement with Ngāti Whātua o Kaipara in July 2013. The Government negotiated in good faith with Ngāti Whātua in regard to the Hobsonville development. A pragmatic and mutually beneficial agreement was reached last year, in which Ngāti Whātua will be a development partner for the village precinct at Hobsonville, which is part of the 1,000 homes we accelerated in the announcement on Saturday. This example shows that the Government and iwi are able to work together to bring more housing on stream while respecting Treaty settlements. I am confident we can do the same in respect of the new programme for using Crown land for housing.

Phil Twyford: Can he confirm, based on recent ministerial statements, whether or not the newly announced houses at Hobsonville are a guesstimate, like the 500 hectares he announced in the Budget, and whether they are in fact only a conceptual house like the land he showed journalists on his magical mystery tour; and does he not think that Aucklanders deserve more than a ghost housing policy?

Mr SPEAKER: The Hon Dr Nick Smith—any of those three questions.

Hon Dr NICK SMITH: What I can assure the member of is that the houses in Hobsonville are a lot more real than the 3,000 houses that were announced by Labour in 2002, of which they did not build a single one.

Te Kōhanga Reo National Trust Board—Audit and Te Pātaka Ōhanga

8. Hon NANAIA MAHUTA (Labour—Hauraki-Waikato) to the Minister of Education: Does she have confidence in the process undertaken by Te Kōhanga Reo National Trust Board to determine whether they acted in a responsible and accountable manner in their oversight of Te Pātaka Ōhanga?

Hon HEKIA PARATA (Minister of Education): I do not have ministerial responsibility for Te Pātaka Ōhanga, as it is a wholly owned subsidiary of Te Kōhanga Reo National Trust. However, I do have confidence in the processes I have put in place. When it became clear in late 2013 that there were significant questions about the trust’s oversight of Te Pātaka Ōhanga, a number of reviews and investigations were commissioned: a jointly commissioned review by Ernst and Young, and investigations by Charities Services and, separately, by the Serious Fraud Office. These were completed by late last year with recommendations for remedial steps. I have been assured that those steps either have been taken or are in train by the trust. A new chief executive has been appointed. Finally, I expect the trust and kōhanga to reform the governance entity so that a new model is put in place that meets the modern tests of representativeness, transparency, accountability, and auditability.

Hon Nanaia Mahuta: In light of that response, does she have confidence in Te Kōhanga Reo National Trust Board; if so, why?

Hon HEKIA PARATA: I have no ministerial power to appoint to or disestablish the trust. The trust is in trusteeship for the kōhanga whānau, and therefore it is the kōhanga whānau who make the decision about their representatives.

Hon Nanaia Mahuta: Does she intend to resume negotiations with the trust board regarding its Waitangi Tribunal claim; if not, why not?

Hon HEKIA PARATA: I have put in writing and in meetings with the trust that I expect the modern governance entity to be put in place, at which time I will resume discussions about the Waitangi Tribunal report.

Hon Nanaia Mahuta: What action will she take if the changes to the governance structures at Te Kōhanga Reo National Trust Board are not made?

Hon HEKIA PARATA: I am not anticipating an outcome that may not occur. I am expecting that the trust and the consultations that it has conducted with kōhanga whānau around the country will result in a modern governance entity.

Hon Nanaia Mahuta: Will the 2014-15 appropriation for kōhanga reo be at risk if necessary changes to the governance structure are not implemented within a specified time frame?

Hon HEKIA PARATA: Kōhanga are paid retrospectively. They are monitored. They are meeting the conditions of their licence. As long as that continues, they are entitled to receive the payment that they receive.

Housing, Auckland—Housing Developments on Crown Land and Consultation with Iwi

9. PITA PARAONE (NZ First) to the Minister for Māori Development: Has he undertaken any discussions or consultation with any other Ministers regarding surplus Crown land in Auckland, which is the subject of potential legal action by Ngāti Whātua and Waikato-Tainui?

Hon TE URUROA FLAVELL (Minister for Māori Development): Ā, tēnā koe i te pātai. Kua oti kē i au te paku kōrero ki ngā Minita e rua, ki te Minita mō Ngā Take Whare, otirā, ki te Minita mō Ngā Take Tiriti, koia nā noa iho. Ā, kua tono reta anō hoki ki Te Pirimia.

[I acknowledge you in regards to the question. I have spoken briefly with the two Ministers concerned, the Minister of Housing and the Minister of Treaty Settlements. That is all, really. And I have written a letter to the Prime Minister, as well.]

Pita Paraone: In light of that answer, has the Minister advised any other Minister that the Crown should take part in a joint approach alongside iwi to seek clarification from the courts regarding the right of first refusal on the surplus Crown land in Auckland; if not, why not?

Hon TE URUROA FLAVELL: Kāre anō. [Not yet!]

Pita Paraone: What assistance or advice has the Minister given to Ngāti Whātua and/or Waikato-Tainui on the proposed release of Crown land in Auckland?

Hon TE URUROA FLAVELL: Kāre ngā iwi nā e kōrerohia nei, i whakapā mai ki te whakautu i tērā pātai kua waea atu ki a rātau, ki te kimi kōrero mō tā rātau tū ēngari, kāre anō rātou kia—

[The tribes referred to here have not been in contact to respond to that question made available to them about seeking advice on the stance taken by them. However, they have not yet—]

Hon David Parker: I raise a point of order, Mr Speaker. The translation service is not working.

Mr SPEAKER: I apologise to the member. On this occasion, yes, the answer that the Minister was giving was not being interpreted. We have two choices of action: to try again or, alternatively, on this occasion it would probably be best if we could ask the Minister to answer that question in English. [Interruption] I am advised that the translation service is back. I am going to invite the member Pita Paraone to repeat the question. We will start again.

Pita Paraone: What assistance or advice has the Minister given to Ngāti Whātua and/or Waikato-Tainui on the proposed release of Crown land in Auckland?

Hon TE URUROA FLAVELL: Kai a rātau tērā; ēhara i te mea kua kōrero au mō tērā take.

[That is really up to them; it is not as if I have expressed a view on that matter.]

Pita Paraone: What assurances can he provide other iwi who are about to settle Treaty claims that the right of first refusal will be honoured within their Treaty settlements?

Hon TE URUROA FLAVELL: Kai roto i ngā ringaringa o ētahi atu Minita tērā kōrero.

[That statement is in the hands of other Ministers.]

Roading—Projects and Economic Impact

10. MATT DOOCEY (National—Waimakariri) to the Minister of Transport: What updates can he provide on the delivery of the Government’s commitment to provide roading infrastructure to support economic growth?

Hon SIMON BRIDGES (Minister of Transport): There are many good updates, but let me give one in Gisborne. Alongside the Hon Anne Tolley and Marama Fox, member of Parliament, it was my pleasure to recently open the first of the Government’s accelerated regional roading projects—as I say, near Gisborne. The Government recognises that the East Coast deserves a reliable and a safe transport network and one that supports local industry, especially the vibrant forestry industry of that region. That is why the Government accelerated investment on improvements to State Highway 35. The investment will support economic growth in Gisborne and its region, as well as enabling the forestry sector to thrive while at the same time making it safe for motorists to pass safely.

Matt Doocey: What other updates can he provide on the delivery of the Government’s commitment to provide roading infrastructure to support economic growth?

Hon SIMON BRIDGES: Well, let me give more good news, this time from Canterbury. Recently I turned the first sod on the final section of the western corridor road of national significance in Christchurch with local members of Parliament. The new $122 million Western Belfast Bypass will provide better and safer links throughout greater Christchurch and will help reduce congestion and travel times. With freight volumes through Christchurch expected to more than double in the next 20 years, the completed western corridor will support economic growth by connecting hubs to the west and the south of the city with Christchurch International Airport.

Free-trade Agreements—Saudi Arabia Negotiations and Al-Khalaf Group

11. Hon DAVID PARKER (Labour) to the Minister of Foreign Affairs: What were the names of the “interested Saudi parties” who participated in the evaluation of the tender proposals for the model farm in the Saudi Arabian desert, and how were they related, if at all, to the Al Khalaf Group, which received the first $4 million payment referred to in his Cabinet paper dated 13 February 2013?

Hon TODD McCLAY (Acting Minister of Foreign Affairs): No Saudi parties participated in the evaluation panel.

Hon David Parker: I seek leave to table the expression of interest document, which at page 11 records that “Evaluation of final proposals will be undertaken by representatives of MFAT, NZTE, and interested Saudi parties together.”

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

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

Hon David Parker: Is the Minister telling the House that no Saudi party had any part in evaluating the final proposals as referenced in his own tender documents?

Hon TODD McCLAY: That was my answer to the substantive question.

Hon David Parker: When did he first learn that members of the Al Khalaf Group had a business relationship with Brownrigg Agriculture, the successful tenderer?

Hon TODD McCLAY: I am advised that in late 2014—at least 1 year after the agri-hub contract was awarded—the Al Khalaf Group became a shareholder in Brownrigg Agriculture. I am informed that Brownrigg Agriculture disclosed it as shareholder at the time with New Zealand Trade and Enterprise, which holds the contract.

Hon David Parker: Did the Minister not know of any earlier association between Brownrigg Agriculture and Mr Khalaf?

Hon TODD McCLAY: I do not have that answer. The member will have to put that down in writing.

Hon David Parker: Does the contract for the model farm guarantee access for the other interested desert farmers in Saudi Arabia?

Hon TODD McCLAY: I also do not have that information, but I am not aware that there are a great number of other farmers in that part of the desert.

Hon David Parker: I raise a point of order, Mr Speaker. It is now 1½ weeks since I sought leave to table those documents. You will recall the discussion that we had in relation to Cabinet papers, and at the time the Government said it would take only a matter of days. They still have not been released and I am—

Mr SPEAKER: Order! This is a point of order. If the member is going to seek leave, would he get on and do it.

Hon David Parker: I seek leave to table the Cabinet paper titled “Policy review of New Zealand’s requirements for the export of livestock for slaughter” dated 11 December 2007.

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

Hon David Parker: I seek leave to table a Cabinet paper dated 3 August 2007 titled “Livestock exports for slaughter and arrangements for live sheep exports for slaughter to Saudi Arabia”.

Mr SPEAKER: Is there any objection to that one being tabled? Yes, there is.

Hon David Parker: And the third—

Mr SPEAKER: Order! Is this the last document?

Hon David Parker: It is the last one. The third document is the paper dated 16 October 2007 titled “New Zealand’s requirements for livestock exported for slaughter”.

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

Climate Change—Risk Profile and Economic Impact

12. Dr RUSSEL NORMAN (Green) to the Minister for Climate Change Issues: Does he agree with the finding in the latest Mercer climate investment report that “New Zealand is the most vulnerable of the developed market sovereign bonds, due to a higher proportion of the population living in low-lying areas, as well as a higher dependence of national GDP on the agriculture sector”; if so, has he received any advice or information on the economic impacts of climate change in the last 12 months?

Hon TIM GROSER (Minister for Climate Change Issues): I regard that report as ludicrous on multiple levels. First of all, there are a range of reasons that any bondholder would take into account before making a rational decision. The average maturity of a New Zealand sovereign bond is 6 years. There will be an imperceptible rise in New Zealand’s ocean level. I think that investors will be looking at the strong economic fundamentals of New Zealand and not at this report.

Dr Russel Norman: I raise a point of order, Mr Speaker. The question had two legs. The Minister certainly addressed the first one. He thought it was ludicrous. He did not address the second leg.

Mr SPEAKER: Order! I will hear from the Minister.

Hon TIM GROSER: Quite apart from the fact that of course there is a well-established principle that we need only answer one question in a multiple question, it was conditional on a certain response to the first, which I rejected.

Mr SPEAKER: On the first point, the Minister is wrong. A primary question can have two legs, and it did have two legs. But on this particular occasion the Minister clearly said that he did not agree with the reports, using words like “it was ludicrous”, or words to that effect, in which case he did not have to address the second part of the question, in my opinion. The member might want to take the issue further forward with a supplementary question.

Dr Russel Norman: Is the Minister for Climate Change Issues doing his job, when the Minister of Finance, in answer to multiple written questions, said that he has received no advice from the Minister for Climate Change Issues or from anyone else in the last 12 months on the economic impacts of climate change?

Hon TIM GROSER: Well, I will leave it to the Prime Minister to decide whether I am doing my job. But the Minister of Finance and I regularly consult on the economic impact of climate change proposals, including some of the more ridiculous proposals put forward by the member.

Dr Russel Norman: Will his strategy of ignoring climate change increase or decrease the future financial risks we face as a nation from climate change?

Hon TIM GROSER: I believe that the policies that this Government is following, which are concentrating overwhelmingly on the real source of the problem, which is the global response, will make a significant contribution to this. With regard to adaptation, I think there is still a lot of work to be done by New Zealand over the next 20 to 50 years, and I am very open to debate on that matter.

Dr Russel Norman: Why is this Government doing next to nothing on climate change, in terms of reducing our emissions, when one of the largest financial consulting firms in the world, Mercer, is saying that our climate risk profile is one of the worst in the developed world; and do not boulders on the roads next to the beach tell him anything about the way the world might change?

Hon TIM GROSER: The boulders on the beach at Lyall Bay do remind people of the need to be a little bit careful when going down there during storms. What the Government is doing is a careful policy of trying to balance economic risks with a responsible attitude towards climate change. We will meet all our international obligations that we have committed ourselves to.

Urgent Debates Declined

Voluntary Euthanasia—Legal Status

Mr SPEAKER: I have received a letter from David Seymour seeking to debate under Standing Order 389 the legal status of voluntary euthanasia, triggered by an application to the High Court for permission to access physician-assisted death. The matters set out in Mr Seymour’s letter do not constitute a particular case of recent occurrence for which there is ministerial responsibility. The proceeding in the High Court commenced in March. There is no ministerial responsibility for a decision of the court or the public interest in debating euthanasia. Because the application does not meet the criteria for an urgent debate as set out in Standing Order 389, it is therefore declined.

Bills

Appropriation (2014/15 Supplementary Estimates) Bill

First Reading

Hon BILL ENGLISH (Minister of Finance): I move, That the Appropriation (2014/15 Supplementary Estimates) Bill be now read a first time.

A party vote was called for on the question, That the Appropriation (2014/15 Supplementary Estimates) Bill be now read a first time.

Ayes 63

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

Noes 58

Green Party 14; New Zealand First 12; New Zealand Labour 32.

Bill read a first time.

Bills

Tariff (Free Trade Agreement between New Zealand and the Republic of Korea) Amendment Bill

First Reading

Hon TIM GROSER (Minister of Trade): I move, That the Tariff (Free Trade Agreement between New Zealand and the Republic of Korea) Amendment Bill be now read a first time. I nominate the Foreign Affairs, Defence and Trade Committee to consider the bill. At the appropriate time, I intend to move that the bill be reported to the House on or before 3 November 2015. A report presented by the committee on or before 3 November will enable New Zealand to notify the completion of its domestic procedures for the purposes of the agreement’s entry into force as soon as possible. For entry into force to occur, Korea and New Zealand must have each notified that they have completed their domestic procedures.

The free-trade agreement between New Zealand and the Republic of Korea is a significant development in our bilateral relationship, which stretches back to the Korean War. Since then, Korea has become an important trading partner. Korea is New Zealand’s sixth-largest export destination and our eighth-largest source of imports. Our total two-way trade with Korea for 2014 was $4.5 billion, and two-way investment amounted to nearly $1 billion. There is significant potential for trade and investment to grow over the coming years. The free-trade agreement will support this growth by breaking down trade barriers and by establishing a framework for resolving issues in the future.

Strategically, the agreement advances New Zealand’s wider trade policy interests of strengthening economic integration in the Asia-Pacific and multilaterally. The agreement will add to our existing network of trade agreements and supports our objective of broader trade reform and liberalisation through the World Trade Organization negotiations. The agreement was concluded following 5 years of negotiations. Given the economic and strategic importance of the agreement, the Government was committed to securing the best possible outcome for New Zealand. The lack of a formal free-trade agreement with Korea has restricted trade growth and has put New Zealand at a distinct disadvantage relative to Korea’s current free-trade agreement partners. The elimination of tariffs under the agreement plays a key role in levelling the playing field for New Zealand businesses. For example, kiwifruit exporters face a tariff of 45 percent on their exports while their major competitor in the market, Chile, is now exporting to Korea duty-free. The agreement is, therefore, crucial in helping New Zealand exporters to remain competitive and to retain their position in the Korean market.

Under the agreement, approximately 98 percent of tariffs on New Zealand’s current exports to Korea will be progressively eliminated. This will take place through yearly reductions. It is estimated that $229 million in tariffs are paid on exports per year. On entry into force, duty-free access will be bound in and tariffs eliminated on approximately 48.3 percent of exports, which is estimated to save approximately $65 million in duties. If the agreement does enter into force this year, then the second tranche of tariff cuts will occur on 1 January 2016, meaning exporters will receive 2 years’ worth of tariff cuts in a matter of months. Therefore, the earlier the agreement enters into force, the earlier these tariff savings can be accessed by exporters.

The phasing out of tariffs on Korean imports is expected also to have a positive impact on New Zealand. Under the agreement, New Zealand has agreed to the elimination, within 7 years, of remaining tariffs on Korean imports. This should provide both consumers and businesses with greater access to high-quality Korean products. For manufacturers using Korean-made components, this should help to reduce costs and, in turn, should increase their international competitiveness. Besides the elimination of tariffs, the agreement includes a range of measures to help facilitate trading goods and services, assist investment flows, and encourage cooperation in areas of mutual interest. The agreement contains improved rules of origin and customs procedures, including the ability for exporters to self-declare the origin of their product. This means that further costs will not be placed on exporters in order to claim tariff preference. Also, the agreement includes other trade facilitating measures, such as the ability to request advanced rulings on origin and tariff classification and a commitment to 48-hour customs clearance. There are chapters covering sanitary and phytosanitary measures, technical barriers to trade, trade remedies, intellectual property rights, and competition and consumer policy.

There are new commitments in Government procurement that secure a level of access to Government contracts with Korea’s central government entities that is equivalent to the access granted by Korea to Australia and the United States, as well as parties to the World Trade Organization Agreement on Government Procurement. The agreement includes a modern, high-quality services framework with commitments that will mean greater services opportunities in both countries, while at the same time recognising the right of our Governments to regulate for public policy objectives. Across a range of sectors, New Zealand’s service suppliers will benefit from improved market access commitments over and above the undertakings that Korea has made in the World Trade Organization—for example, new commitments in adult education services, legal services, and research and development services. As a result, New Zealand’s services suppliers will not be disadvantaged in these areas, relative to competitors from Australia, Canada, the European Union, and the United States, who have secured the same results in their free-trade agreements with Korea.

A “most-favoured nation” provision will ensure that New Zealand service suppliers also get the benefit of any better treatment that Korea grants to any future free-trade agreement partners and will safeguard the competitive position of New Zealand businesses in the future. The agreement includes commitments to facilitate the movement of business people between New Zealand and Korea, which will play a key role in businesses being able to maximise the goods, services, and investment opportunities opened up by the agreement. Korea’s entry commitments under the agreement exceed its commitments under the World Trade Organization, with, for example, new commitments that allow access for New Zealand contractual service suppliers.

Although investment between the two countries has been growing, overall levels of investment are not as strong as they could be. The investment chapter establishes a modern, high-quality set of rules intended to facilitate investment flows between both countries and assist New Zealanders to take advantage of investment opportunities in the Korean market. There are also rules designed to protect investments from unjustified expropriation, or arbitrary or unfair conduct by a party, and to facilitate the transfer of capital related to investment. The investment provisions of the agreement, along with the increased attention and focus that the agreement will give to the bilateral trade and economic relationship, should serve to boost investment interest over time.

The investment commitments being made by Korea and New Zealand include an investor-State dispute settlement mechanism. This provides recourse to negotiation and arbitration if an investor believes that a Government has not honoured its investment obligations under the agreement and that it has suffered damage as a result. The investor-State dispute settlement provisions incorporate transparency requirements and key safeguards to preserve the Government’s right to regulate for legitimate public policy purposes. These provisions have been drafted in a manner that reflects New Zealand’s approach to these provisions in existing free-trade agreements, as well as international developments around investor-State dispute settlement, ensuring an appropriate balance has been struck between investor protections and the rights and responsibilities of Governments to protect public health, safety, and the environment.

The agreement also includes chapters on labour and environment. This is only the second time that New Zealand has included these in the body of a trade agreement. The labour chapter promotes labour rights and enhances our labour capacity and capability, while the environment chapter encourages sound environmental policies. In addition, the agreement includes forward-looking mechanisms such as a joint commission to oversee the operation of the agreement and to resolve issues, and several chapter-specific committees, through which New Zealand and Korea can explore further opportunities to expand trade investment links. The bill amends New Zealand law to implement our obligations under the agreement, thereby allowing New Zealand to ratify the agreement and bring it into force. This requires an amendment to the Tariff of New Zealand to add the Republic of Korea to the list of preferential countries, and amendments to the Tariff Act 1988 to provide for the transitional safeguard mechanism contained within the trade remedies chapter of the agreement.

To conclude, this agreement will play an important role in strengthening our relationship with Korea. It delivers significant benefits across a range of areas, including goods, services, and investments. It helps to reverse the current uncertainty faced by businesses, and it puts the New Zealand - Korea trade and economic relationship on to a very positive track. From a strategic standpoint, it contributes to New Zealand’s wider trade policy interests in strengthening economic integration in the Asia-Pacific region and multilaterally. The Government would like to see the bill enacted by the end of November 2015 in order for the agreement to enter into force as soon as possible. I commend this bill to the House.

Hon DAVID PARKER (Labour): The Labour Party will be supporting the first reading of the Tariff (Free Trade Agreement between New Zealand and the Republic of Korea) Amendment Bill. It is well known that there is a high level of agreement across the House, between the two main parties, that New Zealand is a trading nation that has economic advantages from facing fewer barriers to that trade abroad. The Minister of Trade, Tim Groser, can tell me if I have got this wrong, but I think between 2 and 3 percent is the average tariff that is faced by other countries that are selling goods to New Zealand. In contrast, for a lot of our products overseas we face tariffs of over 100 percent in some of our major markets. Of course, that means that the amount of money that is received by the New Zealand seller is less, because they are facing that tariff barrier at the border overseas.

We are proud of being a pro-trade party. We are pleased to claim some substantial credit, most of which goes to the Hon Phil Goff, for the Chinese free-trade agreement. At the time of the free-trade agreement with China, bilateral trade was about $2 billion per annum. It peaked at about $12 billion, and it is still over about $10 billion. It might drop a little bit under that with the drop in the dairy prices. But a massive increase in the two-way trade between China and New Zealand—

David Shearer: Exports are $10 billion.

Hon DAVID PARKER: Exports are $10 billion, and imports are about the same. Yeah, so bilateral trade each way is about that amount. This tariff bill is supported by us for that reason. If we do not pass this bill in Parliament, not only will we not have the advantage of those tariff reductions but our exporters will face competitive disadvantage in Korea when competing against other countries that face lower tariffs—most notably Australia, which already has a free-trade agreement with South Korea. That means that, all other things being equal, if a New Zealand exporter faces a higher tariff going in to South Korea than an Australian company, then either the prices that are charged by a New Zealand seller have to be lower than the Australian price or you will not get the deal because of the differential in the two tariffs. This is, overall, a good free-trade agreement, and for that reason we support it.

I want to thank the select committee for the way in which it was willing to put up with the Opposition’s questions. We did hold a question time, because we wanted to explore some of the criticisms that have been made in civil society where some very well-meaning people in society are getting very anxious about not so much the trade and goods permitted under free-trade agreements but some of the rules relating to services and, in particular, rules relating to investment protocols. I think one of the reasons why we are now having protest marches around the country—anti - Trans-Pacific Partnership rallies that attract thousands of people—is that we are not having an open-enough discourse with members of the public as to the concerns that they legitimately hold. They are not always right in their concerns, but it is their right to hold those concerns and to express them, and it is the duty of this Parliament and, in particular, the Government to engage with these issues so that they can shed light upon the issues at large.

The common complaints that we hear are, for example, that New Zealand will have to change its laws in a way that accommodates the wishes of the country that we have got a free-trade agreement with. I do not think New Zealand has done a very good job of this in the last 6 years, with due respect to the honourable Mr Groser. I do think we need to do better on this, otherwise you are going to have this rising discontent, some of which is misplaced and some of which is well-placed. I want to consider both sides of that. First of all, I would record the very clear advice that we had from officials—and can I thank them for the advice they tendered the select committee—who made it absolutely clear that this agreement requires absolutely no change to New Zealand’s labour laws, no change to our property laws, no change to our taxation laws, no change to our intellectual property laws, no change to our public health laws, or our environmental laws. I think if a lot of the submitters knew that, or are hearing that—and I hope they do listen to that—their concerns would be, at least in part, addressed.

In respect of the freedom of future Governments to act, we drilled into this a lot at select committee. One of the concerns that submitters raised—actually, before I address that, I will just address the process. Normally, the process for consideration of free-trade agreements under the current Government is very, very truncated. We understand that once you enter into a free-trade agreement you want to take advantage of the economic advantages that flow from reduced tariffs faced by our exporters as soon as possible. That is a proper objective, but it does have to be balanced with the right of the public to actually express their concerns and have their concerns heard and dealt with properly. On this occasion we had the normal 15-sitting-day requirement when the treaty came before Parliament. It was referred to select committee and the motion gave us 15 sitting days, which is, generally, only 3 weeks. But because we had a 3-week adjournment in that period, we managed to extend it, effectively, to 6 weeks. That meant that we could give a period of advertising to interested people. We gave them time to give us submissions, and we had some very detailed and thorough submissions given to us, and then we had time to consider them. As a consequence, I think we left select committee with the agreement of all parties, including some parties that are less pro-trade than we are in the Labour Party, which cooperated to write what I thought was a very good report. And so I would congratulate all members of the select committee on all sides, plus the officials, who helped us to achieve that outcome.

In respect of effects on the ability of future Governments to take action, these generally fall into three areas of concern: constraints on the ability of a future Government to legislate for public health, constraints on the ability to legislate for environmental outcomes, and your inability to control your own destiny when it comes to things like land sales. Again, we had very clear advice from officials that, going forward, there is no curb on proper legislation for public health reasons. The example that we used—and we had very clear advice from the officials—was that, for example, if the Government wanted to introduce plain packaging on cigarettes, then that would not breach the free-trade agreement. We had submissions from some submitters saying that there is somehow a chilling effect on the way in which Governments might respond to that, and saying that this was one of the reasons behind the delay for the current Government’s implementation of what Tariana Turia was pushing as Associate Minister of Health—which was plain packaging on cigarettes—but we were told by the Government that that is not correct.

In respect of future restrictions or proper environmental laws like an increase in the price of carbon or other measures that you need to curb carbon emissions, again, we had assurances from officials that that was permitted. In respect of the third area, though, there is a problem. That relates to whether a future Government can limit or ban new categories of land from being sold to overseas people—in this case, South Koreans. We had advice from Amokura Kawharu. Amokura Kawharu is the co-author of the leading text on commercial arbitration in New Zealand. It is called Williams and Kawharu on Arbitration. She is also an academic at the University of Auckland. She gave us advice that it was not possible to add new categories of land, the sale of which can be banned to foreigners—in this case, South Koreans. I think that is a problem in the drafting of this agreement, and it needs to be made clear—I would hope by a side letter—and I would hope that future agreements are clearer that this is permitted by a future Government because although the current Government might not want to have a ban on overseas land sales, other Governments, properly, might want to, and their ability to do should not be constrained by free-trade agreements.

In my last minute I want to say something similar in respect of stamp duty that applies only to some overseas purchasers rather than to New Zealand residents as well. Both of these practices are common overseas and, indeed, the Australians managed to accommodate both of those matters in its free-trade agreement with South Korea, so we should have been able to achieve that also.

The last thing is investor-State settlement provisions. These are very controversial. There are still some problems with the international mechanisms. Arbitrators and panels that are drawn from trade lawyers are faced with the accusation that they are really not like an independent judiciary. They do go back to being trade lawyers, so they arguably are not quite as independent as a judicial officer should be expected to be. There are limited appeal rights and there is a question, particularly in respect of First World countries, whether you should have investors having rights to sue the State, or just have country-to-country enforcement of agreements, which is what has happened previously in respect of most agreements. I know we have got investor-State dispute settlement clauses in the New Zealand - China free-trade agreement, and that is a good agreement, but we have reached the point in the Labour Party where we would be happy to have free-trade agreements with First World countries without investor-State dispute settlement clauses. It is interesting that in countries such as in Europe, Australia, and, indeed, the United States there seems to be an appetite for that too. With those comments I note again that the Labour Party is supporting this bill.

MARK MITCHELL (National—Rodney): I am very pleased to take a call on the Tariff (Free Trade Agreement between New Zealand and the Republic of Korea) Amendment Bill. I just want to acknowledge the previous speaker, Mr Parker, who subbed on to the Foreign Affairs, Defence and Trade Committee during the select committee process. He drew some important issues to the attention of the committee. I thought that the committee worked very well together. We were all motivated to make sure that we could present the best possible report back to the House, that we could inform the House, and that we could address and allay some of the fears that were raised during the submission process and the select committee process.

We are a small country of 4½ million people, down at the bottom of the world, actually. It is always going to be very difficult to get ahead by trading amongst 4½ million Kiwis, so these free-trade agreements are critically important for the future of our country. Trading with the rest of the world has always been important, and it will continue to be important. I would just like to refer back to some of the free-trade agreements and closer economic relationships that we as a country have formed over the last 30 or 40 years. If I go back to 1983 there was the formation of the Australia New Zealand Closer Economic Relations Trade Agreement. This was one of the most open economic and trade relationships of any two countries. It laid out a comprehensive set of trade and economic arrangements, collectively known as the CER—or Closer Economic Relations partnership. It has been critically important for New Zealand to be able to open up the market in Australia, and Australia is still important to us in terms of both imports and exports.

We have the New Zealand - Hong Kong, China Closer Economic Partnership Agreement, which entered into force on 1 January 2011. We know how important this has been for New Zealand, in terms of China having become a very important trading partner for New Zealand. We have the Malaysia - New Zealand Free Trade Agreement, entered into force on 1 August 2010. Malaysia is, actually, New Zealand’s eighth-largest export destination, with over a billion dollars of exports in 2013. We have the ASEAN-Australia-New Zealand Free Trade Agreement—again, ratified in 2010. We had the New Zealand - China Free Trade Agreement in 2008, which Mr Parker referred to. He highlighted that the Labour Party is also very focused on the fact that trade is important to New Zealand, and, therefore, it was much easier to work together, through the select committee process, to make sure, like I said, that we presented back to the House the best report that we possibly could. Obviously, we have the Trans-Pacific Strategic Economic Partnership, which came into force in 2006. This is an agreement between Brunei, Chile, Singapore, and New Zealand. It was the first multiparty free-trade agreement linking Asia and the Pacific to the Americas. It is also New Zealand’s first agreement with a Latin American country, so it is another very significant free-trade agreement. I could go on, but I just wanted to highlight the fact that we have got a proud history in this country of developing very good free-trade agreements.

I want to acknowledge the Minister of Trade, Tim Groser, who has got a huge background, in terms of having been involved, in several different roles before he actually became the Minister of Trade, with negotiating and dealing in our free-trade agreements in New Zealand. So he brought with him all that experience and all that background.

David Shearer: And all that ego.

MARK MITCHELL: Oh, I am not going to say that. I want to acknowledge also the officials—our negotiators—because several of the submissions that we heard in the committee highlighted the fact that this is a better free-trade agreement that has been negotiated than, for example, the Australian - Korean free-trade agreement. So they have done a very good job. To give you an example, our deer and velvet industry is not big but it is still important, and in its submission it highlighted the fact that it has got a much better deal and an easier entry into and opportunity to grow in the Korean market than, for example, our Australian cousins. We heard from all the major industries through their submissions.

We heard from New Zealand wine producers about some of the issues that they raised. They highlighted the fact that our wine industry is an important contributor to the New Zealand economy. It is the sixth-largest export industry, with an export value of $1.37 billion. Korea is currently a small but high-value market whose potential will be realised more fully with a zero tariff for wine on this agreement’s entry into force. They were very optimistic and quite excited about the reductions in tariffs that will come in incrementally with this agreement and about the fact that they are going to be able to grow their own industry and they have got a new market that they will be able to grow in Korea.

We heard from Beef and Lamb New Zealand. Similarly, it highlighted the fact that Korea is currently New Zealand’s fourth-largest beef export market by volume, returning $125 million from 22,000 tonnes of trade in 2014. As recently as 2011 Korea was New Zealand’s second-largest beef export market, but volumes have been dropping in recent years. Actually, the reason for this is the free-trade agreements that have been triggered with other countries, which have meant that tariffs have been reduced and that we are not as competitive. That actually highlights what I feel is a very important point. Of course, the select committee will be receiving this bill, and I think that it would probably be fair to say—and maybe the next speaker for the Labour Party could comment on this—that we will work as hard as we can, as a committee, to make sure that we get this legislation back into the House and to make sure that the free-trade agreement is available and is triggered, so that our exporters can actually start to take advantage of the reductions in tariffs as quickly as they can.

I mentioned the deer industry. It made a very good submission. The Korea - New Zealand Business Council came and made a submission. Of course, it supported this agreement and saw it as critically important, not just for trade but also as another way of establishing a mechanism for developing strong relationships with a very important partner to us—Korea. Zespri sees a huge opportunity and market in Korea. It was very, very pleased to see this free-trade agreement. It is a resilient industry. I was in the Bay of Plenty with the MP down there, Todd Muller, 3 or 4 weeks ago. He was good enough to take me around and show me one of the packing houses, for us to get a briefing on how the industry has bounced back after the challenges it has faced—the new varieties that it is developing. It is actually a really exciting industry that has got huge potential. This Korean free-trade agreement is going to help it to continue. In fact, I think there is $65 million that can come back into the New Zealand economy just off the back of our kiwifruit industry. We heard from Export New Zealand and, of course, Fonterra.

We did receive some very good submissions and some concerns that we had to address around the investor-State dispute settlement provisions. There are just a couple of points. The Minister has already alluded to them but I would just like to go over them and highlight them again. The investor-State dispute settlement provisions in the agreement do not go beyond those established under New Zealand’s concluded free-trade agreements, some of which I have already highlighted and spoken about, and we have already the benefit of history to show us that those agreements have been very successful, without ever having to incur or be too concerned about investor-State dispute settlement provisions or having to enter into any type of disagreement or arbitration. New Zealand has extended investor-State dispute settlement mechanisms to many trade partners—China, the ASEAN countries, and Malaysia are all examples. We have employed appropriate safeguards and exclusions, which have included important public policy areas—health being one of them, of course. Improved protections for investors will not interfere with the Government’s right to regulate for legitimate public policy areas. I do not think that any member in this House would ever be comfortable with the thought that there could be interference in the way that we legislate and the laws that we pass in this country, specifically in relation to occupational health and safety—

Mr DEPUTY SPEAKER: I am sorry to interrupt the honourable member but his time has expired.

Hon PHIL GOFF (Labour—Mt Roskill): I rise on behalf of the Labour Party; we will be supporting this legislation. It amends the Tariff Act 1988, basically to give preferential tariff rates to the Republic of Korea—that is, South Korea—which is necessary in order for this country to ratify and bring into effect the free-trade agreement that has been negotiated between our two countries. Korea is an important trading partner for New Zealand. It is our sixth-biggest trading partner, and the two-way trade is somewhere in the vicinity of $4 billion.

It was really necessary to bring this treaty forward. We began the process under the last Labour Government, when I was the Minister of Trade, and I was deeply aware that, with other competitor countries like Chile having already achieved a free-trade agreement with Korea, our exporters in a number of fields—for example, in kiwifruit—were losing their competitive advantage. Subsequently, the Americans and the Australians have moved to get a free-trade agreement, and to not have an agreement of this nature would leave our exporters in an invidious and deeply uncompetitive position. So Labour will be supporting this. I want to congratulate our senior negotiator, Martin Harvey. Martin was also my senior negotiator in the free-trade agreement that we negotiated with the ASEAN countries, so I know from personal experience he is a competent and committed negotiator, and I think he would, with the support of his Minister, have got the best deal that he could from the Koreans.

Having said that, I think I would share with Martin and his team, and with the Minister, our disappointment that there were some areas in this free-trade agreement where we did not get the progress and the comprehensive nature of the free-trade agreements that we negotiated earlier with China and with Taiwan. We have got some areas where tariff barriers will remain in place indefinitely under the provisions of the treaty and this bill that brings it into effect. Important areas like the export of frozen squid are not brought in to the deal, and the tariffs remain on them. Unprocessed deer velvet—I think that is 60 percent of our deer trade with South Korea—is not covered by the agreement. There are some horticultural products that are left out of it; and, importantly, for milk powder—milk powder being our single biggest export outside the tariff rate quota—those tariff rates will remain. So there were disappointments in the treaty, but the problem that New Zealand faced in this negotiation, as with so many, is that we have very little negotiating coin, because we have very few export barriers to, for example, trade from Korea coming in. We do have the ability, of course, to facilitate Korea’s entry into something like the Trans-Pacific Partnership, and I am sure that that was used to give leverage to our negotiators.

The good thing about this agreement is that it eliminates over time most of the $229 million that our exporters pay in tariff rates to the Koreans. Of our current exports, it removes tariffs on 98 percent of them. That figure distorts the reality of the picture. Because milk powder tariffs remain in place, and that is not a high current export because of that tariff barrier, the agreement is not quite as good as it seems on the surface, but it is certainly worth having. For example, for the kiwifruit exporters, they were paying 45 percent tariffs. Chile by now has tariff-free entry into Korea. It is our major competitor, so that was an important gain, and that will come into effect in 5 years. On beef exports we are paying 40 percent. That will be eliminated in 15 years. On sheep meat, 22 percent, and that will be eliminated in 10 years. We will largely achieve duty-free forestry exports into Korea over 10 years, and cheese and butter exports in 14 years.

I think every party in the House that was on the select committee doing the treaty examination acknowledged there is a real net benefit to New Zealand in this treaty. The Greens certainly acknowledged that, and so did New Zealand First. But I think it is very hard to acknowledge that you are getting an important net benefit, and that you will suffer quite serious competitive disadvantage if you do not sign the treaty, and then vote against the bill. I guess the other Opposition parties on the select committee are making a symbolic gesture because there are aspects, including the investor-State dispute settlement procedure, that they do not like, but I think our position is to be honest: if New Zealand is going to benefit from this deal, then we cannot vote against it. It is illogical to vote against it if it is important for New Zealand and we get a good benefit from it.

I want to touch on the investor-State dispute settlement, because that was the area in the treaty examination that really drew the flak. It was not about Korea. I do not think anybody thinks that Korea is going to take us to the investor-State dispute settlement procedures any more than China or the ASEAN countries would. They have been in place for 6 years; nobody has taken us through the investor-State dispute settlement procedures, and Korea is extraordinarily unlikely to. But what happened with this bill when we heard evidence on the treaty examination is that it was used as a stalking horse for the Trans-Pacific Partnership agreement. The concern that people had, and I think it is a genuine concern, was that the United States is a litigious country and it might make use of that procedure, so those members of the select committee started their opposition to it under the Korea agreement. Even though we are not really against the Korea agreement, that fires our shots across the bow of the Trans-Pacific Partnership should it go ahead.

I think the select committee procedure on the treaty examination was really useful and well conducted, and I acknowledge the chair and I also acknowledge the officials, because it brought out the reality rather than the hype and rather than the scaremongering. The reality is that in some trade agreements—the North America Free Trade Agreement probably being one of them—the wording for investor-State dispute settlement procedures was pretty loose. There have been cases taken that people have interpreted as being a United States corporation being able to sue, for example, Canada, because it has put environmental protection in place. Well, the reality is slightly different from that.

Any country has the right to put in place environmental protections, but when it does so it has got to make sure that it is non-discriminatory between the nationals in that country and those that are trying to trade into the country, such as Canada. We found in examining some of those decisions and, I think, looking at the minimum standard of treatment provisions that have been used by corporations to sue countries—Bilcon and Canada was a prominent example—that a North America Free Trade Agreement investment tribunal explained in its decision what the standard of the problem, of the grievance, had to be in order to succeed when an investor-State dispute settlement procedure was invoked. The actions of the Government needed to be “arbitrary, grossly unfair … [lacking in] due process leading to an outcome which offends judicial propriety—”. That is not a low standard; that is a very high standard.

So I am satisfied, and I think the officials satisfied everybody on the committee, that they have built into the wording of the investor-State dispute settlement procedure sufficient safeguards that enable New Zealand to retain its sovereign right to legislate for the public good. For example, in public health areas like plain packaging of cigarettes, I would not support an agreement that took away our sovereign right to stop tobacco companies promoting a product that causes death among 50 percent of New Zealanders who use those products. So I think there are safeguards built in there.

I want to reiterate the concern from David Parker, who raised it, that the one area that is not covered would be the sale of residential land to overseas buyers. The Overseas Investment Act is protected. It is exempt under annex II of the free-trade agreement. That means that we can continue to stop—if the Government had the will to stop, that is—the sale of farm land, but the officials were ambivalent about whether we could legislate to stop the sale of residential properties. Right now we have got house prices going through the roof and there is no New Zealander who believes that foreign investors, wherever they come from, buying up and speculating in residential housing is helping the problem. It is making the problem worse and, unfortunately, the officials could not give us assurance that under this legislation we would be able to expand the Overseas Investment Act to cover residential housing. The Australians have done that; they have made that a provision of their negotiation with Korea. I think the Government was remiss in not providing for that in relation to residential property sales under this legislation and this particular treaty.

With that exception, this is a bill that we can support. This is a treaty that will benefit New Zealand. We will be supporting that, but I think the Government is going to have to try harder to make sure that, in every aspect of where we should maintain our sovereign right to legislate, we are able to do so.

Dr SHANE RETI (National—Whangarei): It is a pleasure to speak to this free-trade agreement and to this bill, and I would like to start by acknowledging the Minister of Trade, the Ministry of Foreign Affairs and Trade, and officials for the work that they have done over at least the past 5 years to bring us to where we are today. I would also like to acknowledge my colleagues around the House, those who worked on the Foreign Affairs, Defence and Trade Committee, and the guidance of the select committee chair, Mark Mitchell.

Currently, we import refined oil, cars, electronic equipment, and machinery from South Korea, and we export industrial goods, metals, organic chemicals, forestry products, dairy, beef and lamb, kiwifruit, and buttercup squash. It strikes me that there are four major macroscopic benefits to this agreement with Korea. First of all, we get increased access to a target market of 50 million people for New Zealand trade and investment. Secondly, we get some frameworks that we can pin policy on and that we can work with: frameworks for resolving trade and investment issues, and frameworks for resolving trade and labour and trade and environmental issues. We also get support for New Zealand’s wider trade policy interests in strengthening our economic integration in the Asia-Pacific region. As we have heard, 98 percent of current export tariffs will reduce over time.

I would like to look at some of those in a little bit more detail. What we will see is that the beneficiaries to this free-trade agreement are New Zealand wine, cherries, hides and skins, some forestry products, some aluminium, and many industrial goods exports. They will become duty-free at the agreement’s entry into force. New Zealand beef exports to Korea, currently worth $120.6 million, will become duty and safeguard-free 15 years after the agreement’s entry into force. All duties on New Zealand kiwifruit exports to Korea, currently $44.3 million, will be eliminated over 5 years. If we look at 5-yearly increments—5 years, 10 years, 15 years—what we will see at the end of 5 years is that 67.4 percent of current exports to Korea will become duty-free. At the end of 10 years, that goes up to 79.3 percent, and at the end of 15 years, that is 97.8 percent—clearly a significant reduction in tariffs over time.

We heard from a number of submitters, and I would like to comment also on the Korea - New Zealand Business Council. It reminded us that Korea has already signed agreements with Chile—which is one of our major competitors in this space—the USA, and the EU, and latterly with Canada and Australia. It commented that previously Korea was a relatively closed market and that over the past decade or so the lever for it becoming more open has been the big Korean electronic and car manufacturers becoming more internationalised. With this agreement, we are seeing the benefit of that opening.

It commented also on New Zealand seafood. Even though the green-lipped mussel will have a tariff rate quota placed on it, it commented that New Zealand seafood penetration and entry into the Korean market is a very good thing. More specifically, our green-lipped mussels are perceived as high quality and as having hugely beneficial health effects. As I am sure many of us know, what it is relating to here is the perceived anti-inflammatory benefits of the green-lipped mussel, which may be beneficial to people with arthritis, inflammatory bowel disease, or other inflammatory conditions. It made the point that even though it has a tariff rate quota, it is well respected and well looked at in the Korean market.

Zespri also spoke to us. Zespri is a big player—$1.4 billion in sales of kiwifruit worldwide—and it is projecting to double the volume of its gold kiwifruit in the next few years. For Zespri, Korea is its seventh-biggest market, and it differentiated the Korean market as being very discerning fruit consumers. Quality matters to Korean consumers. In Zespri’s view, this is one of the competitive advantages we have over Chile—that our kiwifruit is high quality and the Korean consumer recognises that. Furthermore, in the kiwifruit space what is really interesting is that we are actually walking the walk with Korea.

So here we are: we have this free-trade agreement, but we actually have skin in the game already, because what Zespri was telling us was that it is already capacity building and risk spreading the kiwifruit market. It is doing that, because it has actually got 100 hectares of kiwifruit growers and kiwifruit that it is growing in Korea and it employs 250 local growers. We do truly come to this agreement with skin in the game. We are already employing people in Korea. We have already got our plants growing in Korea. For kiwifruit growers, their current tariff is 45 percent; Chile’s is zero. There is the reason. There is our loss of competitive advantage right there, which this agreement will change.

We also asked about intellectual property concerns, because as we talk about growing our kiwifruit in Korea, it might be a legitimate concern that we would have with any country that we were doing trade with. We were reassured that there are absolutely no intellectual property concerns with our Korean partners. I would also comment while I am on the kiwifruit story that this is very good news for horticulturalists in Whangarei and the far north. We have a substantial horticulture industry that will benefit significantly from the tariff reduction on kiwifruit.

We also heard from Export New Zealand. It talked to us about the importance of the free-trade agreement in the context of Asia, and what it said was this: “The Korean market is an important one. It is a larger market than the UK and falls only a little behind Japan in market size. Given that New Zealand does not yet have FTA links with the US and Japan, this free-trade agreement is New Zealand’s third most important FTA after those with China and Australia. The duty savings achieved by this agreement are significant and will be greatly appreciated by our members.” Just to highlight, Export New Zealand commented also that it is focusing on the policy aspect and on our relationship with the Asia-Pacific region, which we can often forget the importance of when we are talking about the issue of tariffs. Sometimes that can be the highlight. Our relationship with the Asia-Pacific region is very important as well.

Export New Zealand commented also, as many submitters did, on the investor-State dispute settlements clauses, as my colleagues across the House have raised. I want to read point 9, which they commented to us: “We support the inclusion of the provisions on investment in this agreement. We believe that these will encourage New Zealand companies to invest in Korea and Korean companies to invest in New Zealand. Having an investor-State disputes settlement mechanism is an important protection for investors and we support this.” That is from Export New Zealand. It has 5,300 members, so it has some clout and it has a mandate to be speaking to us in this regard.

I would also like to comment on Fonterra, which was also a submitter and is clearly our biggest exporter. It said to us: “The Korean free-trade agreement allows us to start having similar discussions with Korea as we have had and as we now have with China.” Although part of its skim milk has not been released under this tariff, as was commented on, it sees this as opening wider opportunities with Korea. I would like to read one of the points about the benefits, which it commented on to us. This is from Fonterra: “Importantly, this agreement helps us to create a level playing field for the New Zealand dairy exporters relative to the EU, the US, Chile, and Australia. The EU and US agreements in particular, which entered into force in 2011 and 2012 respectively, have put New Zealand at a significant competitive disadvantage. This disadvantage has started to be reflected in New Zealand’s share of Korea’s dairy imports, which has fallen from 14 percent in 2011 to 8 percent in 2014.”

On that point, I would also like to comment on Fonterra’s reflection on the free-trade agreement and its benefit regarding introducing cheese to Korea. Historically, cheese has been a key dairy export from New Zealand to Korea. However, the preferential access for cheese negotiated by the EU and the US has significantly eroded sales of cheese from New Zealand to Korea. The cheese outcome for New Zealand under the New Zealand - Korea free-trade agreement represents, effectively, parity with the US and the EU for cheddar and block mozzarella. This means that cheddar and block mozzarella exports from New Zealand will reach a zero tariff at the same time as the US and the EU.

I think this is an excellent agreement, and as we heard from most submitters, yes, there are some concerns around investor-State dispute settlements, which we have allayed, and there is some thinking to do on that, as our colleagues have spoken about, but this agreement disproportionally advantages New Zealand. It is an agreement that has been worked on over many years. I have complete faith in this agreement, and I commend it to the House.

JAMES SHAW (Co-Leader—Green): I would also like to speak to the Tariff (Free Trade Agreement between New Zealand and the Republic of Korea) Amendment Bill. I did want to start by acknowledging the hard work of the negotiating team over a number of years on this. Whether you are for or against it, you cannot deny that the New Zealand civil servants who worked on this have done a terrific job and have worked very, very hard for a number of years. I would also like to acknowledge Mark Mitchell for the way he chaired the Foreign Affairs, Defence and Trade Committee. I came on to the select committee just for the process of the hearings, and greatly appreciated being given a great deal of their time to air the concerns of the Green Party. Speaking on behalf of many public submitters, Mr Mitchell chaired the select committee in such a way as to ensure that everyone did get a fair hearing, and that the extensive concerns the public have about the provisions that are contained inside this treaty were heard, so I do appreciate that.

I also want to acknowledge that in reducing tariffs between South Korea and New Zealand there will be a benefit in particular to New Zealand exporters. So it will increase the volume of trade, and make some New Zealand exporters more competitive than they had been prior to this agreement. A number of speakers have previously spoken and waxed lyrical about those dimensions of this bill, so I will not spend any more time on that, but I did want to acknowledge that.

I would like to speak to some of the concerns of the Green Party, and of a number of submitters, that we felt were not sufficiently addressed. They were heard but not sufficiently responded to, we felt. In particular, these are concerns around the protocols to the agreement that are around human rights, the environment, labour standards, and so on. None of the agreements that New Zealand has signed up until this point, including this one, contains enforceable and binding protocols, to my knowledge. We have some questions about that. When the Government says that these agreements lift human rights standards, lift labour standards, and lift environmental standards, my question is whether it can prove it. Can the Government prove, for example, that the environmental provisions contained in the ASEAN free-trade agreement have been met? Has there ever been any evidence of any of these protocols ever actually having been lived up to in any way?

We have looked into it, and we have been unable to find any agreements where they have been. So just the presence of human rights, labour, and environmental protocols in these agreements does not seem to result in any actual activity. Just because the language is there does not, actually, mean that there is any activity following up on that. So we do have concerns that, although this agreement does contain human rights, environmental, and labour protocols, they will not actually mean anything, because they are non-binding and non-enforceable. For us to support agreements in the future, we would like to see those kinds of provisions being made binding and enforceable on all parties.

The main thing I would like to speak about—and a number of other speakers have referred to this previously—is the investor-State dispute settlement mechanisms that are contained inside this agreement. I do want to acknowledge Phil Goff, who earlier said that this is kind of a stalking horse for the Trans-Pacific Partnership agreement. There is now widespread public concern about the nature of investor-State dispute settlement mechanisms out there in the public arena, and that does not seem to be lessening. In fact, that sense of public concern is increasing. I would just like to say a few things about that. Our history with investor-State dispute settlement mechanisms is fairly narrow and it is fairly recent. So if you take the New Zealand - China free-trade agreement, for example, which has been in place for half a dozen years or so, you can say that, no, we have not yet been sued by a corporation under the investor-State dispute settlement mechanisms contained in the New Zealand - China free-trade agreement. But the past is not necessarily a guarantor of the future, and the more countries with which we enter into agreements that contain these provisions the greater the risk we expose ourselves to.

Although we have not yet had a case in New Zealand, the thing is that some of our nearest neighbours, such as Australia, have been exposed to them. We say that we here in New Zealand have an excellent legal system; we have a pretty good system of government, which means that these kinds of provisions are unlikely to be triggered. But so does Australia, so does Canada, and, in fact, so does the United States. It gets plenty of exercise, that is for sure. The average cost around the world of even defending oneself is something like US$9 million. So it would be quite easy for a committed corporation to tie up a Government, incurring costs even on claims that it knows are not going to come to anything.

We also know that, as part of the global system, New Zealand is pretty small fry in the grand scheme of things, but sometimes we are asked to take on responsibilities, or we are exposed to situations, not because people are necessarily concerned about what goes on here in New Zealand but because of the example that it shows for the rest of the world. So we know, for example, that large pharmaceutical companies are greatly concerned about Pharmac, not because New Zealand has a particularly large market for pharmaceuticals but because the Pharmac model is world leading, and there are other countries in the world that are looking at Pharmac and considering instituting a similar system in their own countries. So New Zealand can be exposed to a situation where, because those companies are worried about the threat of those kinds of systems being instituted in, say, Viet Nam or Korea or China or other countries that have much larger markets available, we may be subject to action, kind of as a preventative measure in relation to other markets.

We also know that there is a bit of a chilling effect on legislation. New Zealand has postponed the idea of plain pack cigarette laws because we are waiting to see how the investor-State dispute settlement case between Philip Morris and Australia pans out. We understand that it is unlikely to succeed—the courts are unlikely to find in favour of Philip Morris—but in the meantime, with the number of years that that case is taking, Philip Morris is able to continue to extract profits from the Australian market and also to suppress similar types of legislation appearing in other countries, including here in New Zealand. So sometimes it is not so much about what we do here in New Zealand but about the fact that, because we are part of the international system, these kinds of mechanisms expose New Zealand to a great deal of risk. Those are some real, practical concerns that we have. Given the recent and short history that we have in relation to investor-State dispute settlement mechanisms, and given the global history of these kinds of mechanisms, we think there is a great deal of risk in signing any agreement that includes them.

There is also the matter of principle with this. There is the pragmatic question about what the risk is, but also what the principle is here. Do we believe that private corporations should have the right to challenge laws passed by a democratic Government beyond what already exists in our domestic legal framework here in New Zealand? We have a pretty robust system—one of the best legal systems in the world. Surely if a company that invests here feels that it has been wronged by the actions of our Government, it does actually have recourse to remedies for that within the New Zealand court system, rather than bypassing the New Zealand legal system and going to an international arbitration court where there are many issues in terms of jurisprudence, the quality of those decisions, and so on.

So for all of those reasons we do have real concerns about signing up to this particular agreement, because it contains these kinds of provisions. We would like to see trade agreements that encompass the following things: respect for democracy and sovereignty and the promotion of good international governance; respect for human rights, labour standards and the promotion of environmental standards and ecological sustainability; the promotion of just and sustainable development; and that those kinds of provisions in agreements would be binding and enforceable. Until our free-trade agreements do this, we are not really in a position to be able to support such agreements, and therefore we will be voting against this bill. Thank you.

FLETCHER TABUTEAU (NZ First): This is an amendment bill that essentially recognises that the Republic of Korea exists in our trade legislation. Previous speakers have, in the main, actually ignored the majority of the submitters who spoke at the select committee. We need to have very real concerns about the core provisions within this trade agreement. But let us actually just look at the agreements around goods and services themselves in the trade agreement. We are amending the law for what has been an agreement that has been on the back step from the very start. In fact, the Government itself describes this trade agreement as a catch-up agreement. We have actually entered into free-trade negotiations without any cards to hold. This was spoken about previously. In fact, the Minister of Trade kept using words like “could” and “should” when he described what he would like to see result from this trade agreement. He kept using those words.

New Zealand First understands that this country is dependent on trade. There are no two ways about it. We rely on being an export nation that exports our goods and services around the world. So, trade agreements like this—and when you actually look at the contractual budget, which does not support this trade agreement—need to be looked at again and need to be looked at as a whole. It is one thing to claim a free-trade agreement, but I believe and New Zealand First believes that this is a free-trade agreement in name only. What good is it to Northland, for example, or to our regions, which are the places that are so dependent on good trade negotiations and good macroeconomic settings? Let me get into that now.

The Minister has signed an agreement that means that less than half of our exports to Korea will actually have their tariffs eliminated on the signing of this—less than half. But here we are today now amending legislation to allow better and more preferential treatment to a trading nation that already has, essentially, unfettered access to the New Zealand economy. This Government has said that we are facing tariff rates of up to 178 percent, for example. In the same breath, the Minister assures us that we should celebrate this trade agreement because it will remove that 178 percent tariff rate—but would that we could. The Minister cannot seriously believe that the Korean free-trade agreement will actually be of any benefit to the dairying economy in Northland. For example, it will take 10 years to reduce those tariffs down to zero. OK, that is a big deal—it is going to take a decade for that to come in—but it is actually more insidious than that, and no one has mentioned it. The fact is that once that 10-year time period comes about and we get that zero tariff, it is only on milk powder to the quantity of approximately 2,000 kilos. That is less than 0.13 percent of our milk powder exports around the world. Everything above that level—every kilo of milk powder sold to Korea—will still attract 176 percent tariff in perpetuity and for the foreseeable future. That is not a successful trade agreement.

The trade negotiators have themselves admitted that for many of our core export commodities it will be at least a decade before New Zealand exporters are able to compete on a level playing field. It was positive to hear the Minister speak earlier today of the quicker phase-out of kiwifruit tariffs. He said that they were at 45 percent. What he failed to mention is that the phase-out will be over 6 years, and he kind of made it sound like a good thing that our kiwifruit competition in South America has no trade tariffs with South Korea at the moment. This is what is being handed to our New Zealand exporters as a good trade negotiation. Zespri itself mentioned how positive this trade agreement was, but in the same breath it mentioned that it would take what it could get. Mr Joyce assured Northland farmers earlier this year that this free-trade agreement would eliminate tariffs on beef. What he admitted at the time was that it would take 15 years for these tariffs to be removed. Further, our seafood industry was spoken of several times today. What did not come out in those conversations was that one-third of our seafood exports to Korea are, and will continue to be, subject to the 22 percent tariff. So there is no provision for one-third of our seafood exports to enjoy the benefits of this supposedly great free-trade agreement. I put it to you that it is not much of a free-trade agreement.

Then we come to the question of what New Zealand has had to give up in order to gain common ground in this trade agreement. We could not negotiate or compromise anything in the way of tariffs or quotas because we are already one of the most open economies in the world. We are holding no cards in this trade game. Actually, we have been handed one card, and we have been forced to play that card. We are now forced to play it every time. I am advised that our compromise—the only thing asked for by the Koreans in this agreement—was the inclusion of the investor-State dispute settlement provision in this agreement. The investor-State dispute settlement clause was pretty much what we were asked to give in return for what I would call a manipulation of tariffs. We are being asked to give up our sovereignty a little bit at a time.

We were advised at the select committee by experts that our two countries have the best legal systems in the world. Korea acknowledges our legal system. We acknowledge how robust and great theirs is. And yet we are being forced into an agreement that has a clause that asks us to incorporate investor-State dispute settlement. For some reason, we agreed to this—or the Government agreed to this. We agreed to a tribunal system that operates as a black box and that operates outside of and independently of New Zealand laws and South Korean laws. So we are agreeing to deal with trade issues outside of our laws. That is what we have done. It is illogical and, I will say again, it undermines New Zealand’s right to create and enforce our own laws, which makes a debacle of the debate around the Magna Carta today, brought to the House by the leader of ACT. The leader of ACT will not support a member’s bill debating this very point, in the House, hopefully, in the not too distant future.

Labour has spoken of the benefits of this trade agreement. Labour and this Government have chosen to ignore the reality that the majority of the submitters to the select committee spoke out with passion and, actually, sound argument, which has been conveniently ignored today. New Zealand First believes that this free-trade agreement did not achieve what was promised. What has been negotiated on our dairy farmers’ behalf, for example, achieves literally nothing. The inclusion of the investor-State dispute settlement provision—a provision that legal and trade experts, not only from New Zealand but from around the world, have said is inconsistent, arbitrary, and lacking in transparency. New Zealand First cannot support an agreement that has achieved so little today. New Zealand First acknowledges that the urgency for good trade agreements is paramount, but we say that this is not one, and these amendments are unnecessary.

DAVID BENNETT (National—Hamilton East): I would like to acknowledge the good words that have been said by members of this House in regard to how the Foreign Affairs, Defence and Trade Committee worked on this free-trade agreement. I especially acknowledge the good chair of the committee, Mark Mitchell, who did a great job as chair, so I am acknowledging his ability to chair that committee so well. I also acknowledge the Labour members on the committee, who have made their points well-known during this debate and also through the select committee stage, but at the same time they have recognised the importance of free trade to New Zealand—especially Mr Goff over there, who spoke earlier, who was instrumental in the Chinese agreement. He understands that sometimes you just have to look and make the best agreement you can. You cannot always have everything that you would want, which is contrary to what New Zealand First and Green Party members have said. I just want the members of the public who are listening to this debate to remember that.

On this side of the House you have a National Government that is intent on building our trading base, that is intent on giving New Zealanders the opportunity to prosper and succeed in the world, and that is intent on giving our exporters the tools to go out there and show their wares on the world stage. It is an intent that is actually supported by the Labour Party—good on those members—but it is not an intent that is supported by the other forms of the Opposition, New Zealand First and the Green Party. Whether to have those parties, together with the Labour Party, is the choice that New Zealanders have to make. It is not a choice between National and Labour; it is a choice between National and Labour, the Greens, and New Zealand First. Under that choice of Labour, the Greens, and New Zealand First, New Zealand would not be a free-trading country. New Zealand would not be a free-trading country. There would—

Darroch Ball: Oh, rubbish!

DAVID BENNETT: “Oh, rubbish!”—OK, well, your members have voted against this bill—[Interruption] It would be interesting to see whether that member would actually have some rational reason between—

The ASSISTANT SPEAKER (Hon Trevor Mallard): Order! I think we have had a double offence, so you would probably let both of them go. Dr Graham, please do not interject when you are wandering around. Mr Bennett, do not refer to Dr Graham as me. Thank you.

DAVID BENNETT: Nobody would refer to Dr Graham as you, Mr Assistant Speaker.

The New Zealand First member asked what was good in this agreement for Northland. What is good in this for Northland? Well, what is Northland but a productive part of our country? Northland produces the goods and services that are shown around the world. It produces the forestry products that we export. It produces the dairy products that we export. It produces the meat products that we export. It produces the food products that we export through all our great ports in New Zealand. The Northland economy has the most to benefit from this free-trade agreement.

Dr Shane Reti: Auckland’s garden.

DAVID BENNETT: It is Auckland’s garden but it is also the Garden of Eden for South Korea now, and that is the fact. Without the free-trade agreement, Northland does not prosper.

It is very, very sad that the new member for Northland could not actually be in this House and deliver a speech in regard to that. It is very sad that his associates—

The ASSISTANT SPEAKER (Hon Trevor Mallard): Order! The member knows that he does not refer to the absence of a member. He will withdraw.

DAVID BENNETT: I withdraw, but the New Zealand First Party is not supporting this bill, and it said—

The ASSISTANT SPEAKER (Hon Trevor Mallard): The member will resume his seat. The member knows that he must unconditionally withdraw. The member cannot say: “I withdraw, but”.

Hon Member: That’s an interesting turn of phrase.

DAVID BENNETT: Yes. I withdraw.

The ASSISTANT SPEAKER (Hon Trevor Mallard): Thank you.

DAVID BENNETT: The New Zealand First Party does not agree with this bill, and it does not see any advantage in this for Northland. Well, there is advantage for Northland. If you are an exporter coming from Northland, you want those tariffs to be removed. Those tariffs that are there are holding back the export potential of that region and, therefore, the growth of that region. That is what this bill is about. It is providing growth and opportunity for the regions of New Zealand—those exporting bases that are important for the growth of our country going forward. I commend all parties of this House that have supported this bill for the ability in the way that they have done that.

All free-trade agreements involve some negotiation. There is no set-piece free-trade agreement that will happen overnight. The New Zealand First members have said that this is a thing that will take a period of time to come to fruition. Well, that is the case. That is the normal nature of free-trade agreements. The question for New Zealand is whether we stay out of free-trade agreements, hoping that we get it all in one hit—which would never occur—or whether we actually go into those free-trade agreements and build that base for our economy going forward. New Zealand needs to enter these agreements.

For example, when we look at the South Korean agreement, the Australian Government had already entered into that some years ago. New Zealand was behind the eight ball. Our competitive advantage was being eroded by our inability to actually compete in that market through not having a free-trade agreement. This free-trade agreement gives us that ability. It is somewhat a number of years later than the Australian one, but it still gets us into that zone and gives us that ability to deliver for our exporters.

If we took the Opposition point of view, New Zealand would not enter these agreements. New Zealand would put up a fortress mentality and believe that it could put in a number of trade barriers, tariffs, and suchlike to stop New Zealanders being realistic in their ability to trade.

Darroch Ball: Rubbish.

DAVID BENNETT: The member over there says “Rubbish.”, but that is the party policy of his party. His party is against free trade. It has always been against free trade. It always will be against free trade. That is the case of his party.

Darroch Ball: That’s rubbish.

DAVID BENNETT: If it is not rubbish, vote for the bill. Vote for the free-trade agreement. Vote for this agreement that is in front of you today. Why do you not vote for it? Because those members are against free trade—that is why.

New Zealanders know that they need free trade. Look at some of the aspects of this bill. Look at some of those products that are going to be advantaged by this bill. Look at kiwifruit. Kiwifruit has a 45 percent tariff. That is a large tariff, and that will be phased out over 5 years. That is good for the New Zealand kiwifruit industry. That puts us on a level playing field with Chile—one of our biggest competitors in that industry, in that region, in that market—because it already has a free-trade agreement.

If you look at meat products, New Zealand exports about $186 million worth of meat products to Korea each year and we pay about $70 million in duties. That is a 40 percent tariff, which will be phased out within 15 years. A 40 percent tariff phased out in 15 years—that is good for the people of Northland and that is good for the exporters of New Zealand. In forestry, $503 million worth of forestry products is going into Korea. Over 99 percent of those exports will be duty-free within 10 years. That is good news for the people of Northland. That is good news for the people of New Zealand.

Fletcher Tabuteau: Talk about ISDS.

DAVID BENNETT: I challenge that party over there, which is anti - free trade and now has the ability to represent the people of Northland, to stand up for the people of Northland. Give them something. Do not take things away from them. Give something to the people of Northland. Give them the opportunity to go out there and to deliver their economic future. Do not take it away because of some pure ideology that their leader may have, which those members will follow like clones over in that party.

Then the Green Party will never agree to free trade. The Green Party will find every excuse in the book to avoid having free trade. It does not matter whether it is the best free-trade agreement that could ever be written. Even if Kennedy Graham had written the agreement he would not vote for it, because those members would not. The Green Party cannot philosophically agree with free trade. So that bloc of the New Zealand Opposition is against free trade, and that is the thing that New Zealanders need to take out of this debate.

The Labour members know it is good. They know they are going to vote for it. They know it is the right thing to do. The New Zealand First Party is against it. The Green Party is against it. The National Government is for it and has delivered this for New Zealanders.

This is a good bill. It is good for the people of Northland, and it is a shame that the representatives from Northland will not vote for it, but that is something that is those members’ prerogative and shows that they do not actually care for the people of Northland. And who did not expect that to happen in this House, because in the end they do not care. They want to go back to the 1950s, to some little space that they can control, and that is not good for New Zealanders. We need free trade and this delivers it. Thank you.

JULIE ANNE GENTER (Green): I rise to speak on the Tariff (Free Trade Agreement between New Zealand and the Republic of Korea) Amendment Bill. This bill amends New Zealand’s law to ensure implementation of the free-trade agreement that has been negotiated between New Zealand and the Republic of Korea. I guess it does two things, which I have not heard many of the speakers refer to. It enacts the preferential traffic rates as per the free-trade agreement and it establishes transitional safeguard measures to be applied on imports. So it is very specific. It is not actually voting on the agreement itself. Parliament, unfortunately, does not have the opportunity to vote on that. We had only limited ability to scrutinise the agreement once it had already been negotiated, as is the case with most of our trade agreements. So the Green Party has to use this particular bill to raise concerns that are more general about this particular free-trade agreement.

I have to respond to the previous speaker, David Bennett, who accused the Green Party of being completely against free trade and saying we would not vote for a trade agreement even if my colleague Dr Kennedy Graham had authored the agreement himself. I have to say there is a lot of heavy rhetoric coming from the Government benches about this agreement and about free trade in general, and a lot of rhetoric, as well, about the position of the Green Party. As is often the case, our actual position is far more nuanced and the benefits and disbenefits of trade agreements are far more complicated than the Government members would ever admit or, perhaps, understand. The Green Party is absolutely for trade. We are a trading nation and, if anything, we would like to increase the number of exports and the value of our exports in the world. Unfortunately, the current Government’s policy is not supporting growth in exports. Although it had very ambitious targets to grow exports to something like 40 percent of GDP, they have actually declined since it came into power and it has revised its targets downwards so that it can be closer to meeting them. But we do have real concerns with many of the free-trade agreements that have been negotiated by this Government and previous Governments, including this one.

Firstly, I will just say that we are disappointed that we do not have the opportunity to debate these and scrutinise these properly in Parliament, because it is, I think, a really important role for parliamentarians to have some say over these sorts of agreements. Our biggest concern, of course, with this particular agreement—although I acknowledge that there could potentially be benefits for certain exporters here in New Zealand and we welcome those benefits—is that the text also includes investor-State dispute mechanisms. The problem with those processes is that they actually start to give more weight to the interests of foreign investors than to the people of New Zealand and we have real concerns about that—about the impact on sovereignty and about the impact for us to democratically design laws that will protect our environment, safeguard public health, and enable us to control the out-of-control housing market in Auckland.

The reality is that those are not necessary to reduce the barriers of trade. The investor-State dispute mechanisms have nothing to do with reducing barriers to trade. They have everything to do with protecting big multinational corporates from being regulated by other Governments and that is a huge problem for democracy. It is a huge problem for all of us in the world—the people of Korea, the people of the United States, the people of New Zealand who would like to see real action on environmental degradation, who would like to see real action on climate change, and who would like to protect public health from companies like tobacco companies who benefit, of course, and profit from selling misery to people. It should be the democratic right of people to put in place policies that protect public health and that protect the environment.

I will finish with a quote from the Nobel laureate in economics Paul Krugman, who is pretty lukewarm on many of the trade deals that are being negotiated at the moment, including the Trans-Pacific Partnership agreement. He says that almost everyone exaggerates the importance of trade policy. Although comparative advantage was correct and very important at the beginning, the truth is once markets are fairly open we get very, very small gains from opening them further. It is relatively so.

David Shearer: Where’s the evidence?

JULIE ANNE GENTER: The evidence is that there are not usually the benefits that are used to sell these agreements in the first place. We can just look across the Ditch to Australia where a review of bilateral and multilateral trade agreements found that overall the cost to the Australian economy slightly outweighed the benefits. So the benefits of these agreements are being exaggerated. There are huge threats to our ability to regulate in the future and it is for that reason the Green Party will not be supporting this bill at first reading.

PEENI HENARE (Labour—Tāmaki Makaurau): Tēnā koe, Mr Assistant Speaker. Thank you for the opportunity to take a call on this particular bill, the Tariff (Free Trade Agreement between New Zealand and the Republic of Korea) Amendment Bill, the free-trade agreement between New Zealand and the Republic of Korea, otherwise known as South Korea. Our country has a proud history of trade. Many in this House have already touched on it and I think about my ancestors from the far north who, as early as the 1820s and 1830s, were already taking goods offshore and selling them to markets in Australia and also as far abroad as Europe. It is a reality of the global economy and it is a 21st century reality now that in order for our country to remain competitive in global stakes, trade agreements are a necessary part of that. Can I congratulate members on what sounds like a pretty robust and strong process that went through the select committee process—many across the House have congratulated each other and also the officials on the information, the reports, and documents provided to the select committee and to the members across all parts of the House on this particular bill.

We in the Labour Party support this amendment bill at the first stage, at the first reading, and my colleagues on this side of the House who have spoken already—and one is yet to speak—clearly have a heck of a lot more understanding about these types of agreements. I want to support and acknowledge their expertise in this particular field. Labour is about free trade. I have already mentioned that it is a global reality of the 21st century and it is important that we are across these particular agreements, whether they be made with South Korea or with any other country. I believe that in order for these types of trade agreements to be fair, it is important that public dialogue is considered. We have heard mention today about the advice given by officials.

I want to pick up on a point made by my colleague the Hon Phil Goff about the need for appropriate dissemination of information regarding this free-trade agreement. I mention the word “appropriate” because we know, and it has already been mentioned, that it is important you do not put all of your cards on the table. But what is important is that the New Zealand public are fully engaged and that the New Zealand public are well aware of these types of agreements. Mr Goff mentioned too the marches that have happened across the country, marching against the Trans-Pacific Partnership. Some of the scaremongering that goes on can quite easily be allayed by appropriate discourse between this House and of course the New Zealand public.

The value of total trade imports into South Korea is in the vicinity of approximately $490 billion. We support growing our markets worldwide. Although New Zealand is slow in getting our engagement with South Korea, we already note that we follow in the footsteps of Australia—and it is not lightly that I mention that; nobody in this country likes following in the footsteps of an Australian. It is important that we recognise that we are actually quite late to the table. It is important when we sit down and work out these trade agreements that we can maximise the benefit for us and also protect our markets. I just want to point out one of the particular exports from this country that will do well, and I make mention of Zespri and the kiwifruit market. I say that because I currently sit on a trust board, and we have kiwifruit orchards. We are quite excited about the growth of our product and the marketing of it offshore. We can guarantee them that the kiwifruit growing in our orchard is of the highest quality.

But there are some concerns and they have been mentioned. As a Māori, whenever the word “sovereignty” is used everyone gets nervous and the country holds its breath. It is important to note that, and I go back to my point around the dissemination of information out amongst the public and the engagement of the public on these particular matters, so that the fears around sovereignty that are raised by this can be allayed. Also, there is the commitment to prevent foreign investments in property in this country. We are sad that a full commitment has not been made. Australia has done it, to look after themselves. Why have we not done it to look after ourselves and our property here in New Zealand? Kia ora.

JAMI-LEE ROSS (National—Botany): As the House continues to debate this bill, which will help to implement many of the aspects of this free-trade agreement, I would just like to acknowledge the ladies and gentlemen in the gallery who were part of the team leading the negotiations on this free-trade agreement. Martin, with his able assistant—

The ASSISTANT SPEAKER (Hon Trevor Mallard): Order!

JAMI-LEE ROSS: Mr Assistant Speaker, it is worthwhile acknowledging the hard work—

The ASSISTANT SPEAKER (Hon Trevor Mallard): The officials, rather than their presence, because that is inviting problems.

JAMI-LEE ROSS: OK, the officials. I am trying to do something good. [Interruption] You would have made a good hall monitor, Mr Assistant Speaker. I will start again. I wish to acknowledge the excellent work of the officials who have helped to ensure that this free-trade agreement has been through the many stages of negotiations that have led to us now, in this House, debating a bill that will lead to the removal of many of the tariffs associated with goods and services to do with trade with Korea. Minister Tim Groser has also been a passionate advocate for free trade throughout his whole career, and now it must be one of the highlights of his career to be able to stand as a Minister in this Government, announcing the removal of tariffs and putting free-trade agreements through this Parliament. He is done an excellent job too, and it is worthwhile acknowledging that.

Korea is our sixth-largest export destination. There is about $4 billion worth of two-way trade between our countries. Free-trade agreements like the free-trade agreement between Korea and New Zealand lead to better trade conditions for New Zealanders. They lead to better trade conditions for companies, particularly those that are exporting to countries that we have free-trade agreements with. They are able to lift the number of products they are exporting, and that is a good thing for this country. We have heard some debate so far in this House from different parties. We had quite a bit of debate in the select committee when the committee considered the free-trade agreement. I have to say it is good to have the Labour Party and the National Party agreeing on something for once in this House. Quite often we are at loggerheads on issues. But I have to say that sitting on a select committee with the likes of Phil Goff and David Shearer who have a huge amount of understanding, knowledge, and wisdom when it comes to trade matters—as a younger member of Parliament it is always good to learn from older gentlemen and the experienced ones on the committee.

I think it is worth acknowledging that this trade agreement follows on from a number of trade agreements that have been hugely beneficial for New Zealand—most notably the China free-trade agreement that Phil Goff was very much involved with. When we have seen the exports under that agreement going from about $2 billion in 2008 to about $11 billion now, we can see the huge growth potential that is there for New Zealand and for the people who wish to export. The reduction in tariffs that is covered under this bill predominantly is around the New Zealand side, but we must understand of course that there is about $229 million worth of tariffs that New Zealanders are paying when they are exporting to Korea. The reduction in tariffs is absolutely a good thing for New Zealand.

I just want to address a couple of things that we have heard so far in this House. Firstly, Julie Anne Genter said it is unfortunate that New Zealanders have not been able to look at this properly or that Parliament has not been able to look at this properly. I have to say that this agreement is going through exactly the same process that every trade agreement goes through. It goes to the select committee for consideration. Submissions were called for from the public. The select committee, led by Mark Mitchell, conducted thorough hearings on those submissions. It actually helped to form in a significant way our understanding of trade agreements and the Korean free-trade agreement. We were ably assisted by officials whom I am not allowed to name, but they also provided good input into this process. It is also worth remembering that since 2008 the ministry has been conducting consultation with those who are interested in trade agreements like this. It is not as if it was secret that there were negotiations under way. The fact that we have been negotiating as a country with Korea has been very open. So let us just knock on the head this rubbish that it is all done in secrecy, no one knows about it, and that we have not had thorough consideration. The fact we are debating this bill right now is part of that thorough consideration. New Zealanders do get that opportunity.

I also want to talk about the investor-State dispute settlement processes because they were a part of the submissions that dominated much of the discussion at the select committee. It is interesting to note that many people have fears around the investor-State dispute settlement provisions. I think those fears are unfounded, and they have been hyped up a lot by those who are seeking to try to stop New Zealand being involved in the Trans-Pacific Partnership agreement. But it is worthwhile noting a few facts and figures around that. It is not a new thing for investor-State dispute settlement provisions to be included in our free-trade agreements. We have the China free-trade agreement that has this provision in place. The free-trade agreement between New Zealand and the ASEAN nations and the New Zealand and Malaysia free-trade agreement are all trade agreements where investor-State dispute settlement processes are already in place. Have we ever been challenged as a Government under those provisions? The answer is no. We have a good track record under these provisions.

So the next question one might ask themselves is: what is the state of investor-State dispute settlement processes around the world? How many have been challenged? How many nations have been challenged under these provisions? Well, the overall number of concluded cases around the world, according to the United Nations Conference on Trade and Development, has reached 356. That sounds like a lot of challenges if you just look at that number—356. But then, how many actual agreements are in existence that have these provisions in them? The answer to that is 3,268, according to the United Nations Conference on Trade and Development. Around about 10 percent of trade agreements that have these provisions have led to challenges to the Governments where investors have challenged those Governments. It is, actually, a relatively small number considering the many, many decades that these types of provisions have been in place. New Zealand has not been challenged at all under that. In fact, New Zealand has used provisions like this to try to protect our own investments, because it is not just a one-way street. It is not a case of these big, foreign corporations that are out to get New Zealand coming to this country and challenging us. In fact, it actually ensures that our investors are protected as well.

The most important point, I think, that the whole Parliament needs to realise around these provisions is that if we did not include investor-State dispute settlement provisions in our trade agreements, we would not have these trade agreements because they are demanded by many nations around the world. If we want to be a global player and if we want to help to reduce the barriers to trade for New Zealand companies wishing to export overseas, we have to give positive consideration to these provisions. When we hear the New Zealand First Party and when we hear the Green Party say they are opposed to investor-State dispute settlement provisions and they will not sign up to any free-trade agreement that has investor-State dispute settlement provisions in it, they are effectively saying they are opposed to free trade. And when they say they are opposed to free trade, they are saying that they are opposed to the reduction in tariffs for New Zealand companies. When they say they are opposed to the reduction in tariffs for New Zealand companies, they are saying they are opposed to greater growth. They are also saying they are opposed to more jobs for New Zealanders and they are saying they are opposed to higher wages for New Zealanders.

At the end of the day, that is what it comes down to. At the end of the day, we do not enter into these trade agreements for any other reason than because we want to grow our exports, which leads to more jobs, which leads to greater growth and higher wages for our citizens. So let us have the Green Party and the New Zealand First Party being honest with the public. Do not go up there and try to whip up anti-sentiment towards the investor-State dispute settlement provisions without actually telling them what you really mean. What they really mean is that they are opposed to our exporters having a better opportunity to export to these countries. They should be out there talking to the dairy industry, talking to the kiwifruit industry, talking to the meat industry, talking to the forestry industry, and talking to those industries about how they are opposed to the reduction in tariffs for those industries. The half a billion dollars’ worth of exports in the forestry sector would be impacted. The $220 million worth of dairy products exported to Korea would be impacted. These are the real situations that free-trade agreements like this deal with. Our negotiators, our Minister, and our Government, supported by the other side of the House, have come up with a good free-trade agreement here. It is worthwhile the House supporting it.

DAVID SHEARER (Labour—Mt Albert): Can I acknowledge the officials who are in the House today to witness the first reading of this free-trade agreement with Korea. I think 5 long years of pretty tough negotiations—and I will go into some of the details of why they were so tough in a minute—have resulted in what I would consider and what we consider a pretty good agreement. For that reason Labour is supporting this bill, which aims to reduce the remaining few tariffs that could be imposed on Korea to enable us to get this free-trade agreement into effect and to start reaping the benefits from it. This party, the Labour Party, is a party that supports free-trade agreements. We implemented more free-trade agreements in our term in office than the other side has, certainly, but we were supported by the other side, and I think that was the point of the last speaker, Jami-Lee Ross.

Thirty-one percent of our GDP is dependent on exports. Unfortunately, that figure is dropping. It was 31 percent; actually, it is now down to 29 percent, despite the Government’s target of increasing it to 40 percent. One of the most important issues and one of the factors in keeping that figure up was our free-trade agreement with China. I ask you to think of what the situation would have been like going into 2008 with the financial crisis in front of us if we did not have that free-trade agreement with China. We were exporting $2.2 billion to China in 2008. By 2014 it had gone up to $10 billion—$10 billion—and China had become our largest trading partner. You can aim whatever criticism you like at that free-trade agreement, but without it we would be lacking the growth and the jobs that sustained us through that period of the financial crisis, and if we had not had that free-trade agreement we would have been in a much worse state than we are at the moment.

So is a bit a rich for the Greens and New Zealand First, who both opposed that free-trade agreement, to stand up here and talk about the woes and ills of free-trade agreements. It is a bit rich. And to oppose this free-trade agreement when there are so many benefits coming to New Zealand is a bit rich as well, I think. It makes me ask whether, if their vote was the deciding vote of whether this agreement came into being or not, they would actually do it, or whether they are just, in a sense, luxuriating in the fact that they are in Opposition and that they are an Opposition party where their vote does not actually matter because they have got the Labour Party here to support the agreement. My feeling is that if they did not they would be doing New Zealanders out of jobs and New Zealand out of growth that it could have otherwise had.

The free-trade agreement with Korea, as I said, is the result of 5 years of negotiations that came about, and they were tough negotiations, as we were told by the officials, because, basically, New Zealand is really pretty open. We will be taking off and going without $4.2 million of tariffs that we might have otherwise collected from Korea, but we will get $220 million worth of tariffs removed from our exports. So we will immediately start benefiting from having those gone. It will put us on a level playing field with the EU, with Australia, with the US, with Canada, and with Chile. All of these countries have negotiated free-trade agreements with South Korea before us. So it is not just about the tariffs that happen right now, but it means that we will be able to compete with those countries into the future. That is the important point. Korea, which is currently our sixth-largest trading partner, has the potential to grow much, much more.

The example of Chile is an important one. Chile, which entered into a free-trade agreement with South Korea much earlier, now has zero tariffs on its kiwifruit. We currently have a tariff of around about 45 percent on our kiwifruit exports to Korea. We are now going to be able to compete much more effectively with countries like Chile, so the benefits are huge. I want to just go through it: 45 percent in kiwifruit, 40 percent in the meat industry, Fonterra, fisheries, and forestry. Yet we heard from many of the submitters who came before the select committee that somehow—and I quote two or three of them—this free-trade agreement would benefit the few at the expense of the many. Well, look, those industries, which are our core industries in New Zealand, employ hundreds of thousands of people. No, this is an agreement that will benefit the many at the expense of the few. This is about us growing jobs, growing our economy, and benefiting all New Zealanders.

This bill that we are looking at today, as I said, means that we will reduce our tariffs that apply to Korea at the moment. It will be a cost to us of about $4.2 million, but at the benefit of more than $200 million in reduced tariffs to our exports overseas.

Many of the people who came before us—as has been spoken about before—had a number of issues around the entering of free-trade agreements. I will mention one thing that I think the Government has been very remiss on, and that is that it has not been an advocate of what really constitutes a free-trade agreement, and not only in Korea, particularly, but more broadly with the issue of the Trans-Pacific Partnership agreement. When we were negotiating with China—if you go back and take a look at the records, and Phil Goff can, I am sure, support this—the Labour Government went to extraordinary lengths to make sure that we had a wide cross-section of society on board.

When we were in the select committee the other day, we were asking the Ministry of Foreign Affairs and Trade how much outreach had actually been going on other than to business groups. Over the course of a year there would have been maybe five or six civil society groups that had actually been talked to about the Trans-Pacific Partnership and free-trade agreements. That means that there is, out there, I believe, a wrong impression of the value of free-trade agreements versus the costs or risks to New Zealand. It is time that the Government woke up to this fact and actually went out there, that it got down and actually talked with the people, rather than being arrogant and high-handed, as unfortunately it has been, and that it started talking about free-trade agreements.

The investor-State dispute settlement procedures have been talked about, and they were talked about, mainly, with regard to the Trans-Pacific Partnership. We have to look very carefully at these. They are not perfect by any means, and I think some of the submitters made some very good submissions on this. But on the other hand, they are not kangaroo courts, as was often referred to. In the case of the Korea free-trade agreement, it was Korea that insisted that we go into an investor-State dispute settlement procedure and include that in the free-trade agreement. We insisted that we include it as part of the Chinese free-trade agreement, because it gave us a certainty that we could go at least somewhere when we did not necessarily have confidence in that particular country’s judicial procedures.

If we take a look at what has come about through the investor-State dispute settlements, there have been 356 concluded cases—37 percent of those have been in favour of the State, 25 percent have been in favour of the investor, and 28 percent have been settled. In 44 claims against the OECD countries, the State won 86 percent of the time. So New Zealand is not about to be taken to the cleaners here. This is the second obvious point: we have never been taken to an investor-State dispute settlement tribunal before. There has never been a case that was seen to be able to stack up. We have never been taken through the World Health Organization procedures, either. So we have got to get this into perspective a little bit. We are not saying that what we are seeing here is perfect, but what we do need to know is that there is a settlement procedure out there that is not in any way as broken as many people would like to profess.

I will mention one thing that I believe that the Government has not been able to answer properly—and David Parker spoke of it before—and that is the area of residential houses and overseas investment into our residential market. Like all New Zealanders, I do not want to see our residences—our homes, our houses—treated like pork bellies on the New York Stock Exchange. I do not believe, and according to Professor Kāwharu, who gave evidence in front of us—

The ASSISTANT SPEAKER (Lindsay Tisch): I am sorry to interrupt the honourable member. His time has expired.

Dr JIAN YANG (National): I am delighted to take a call in support of the free-trade agreement between New Zealand and the Republic of Korea. Before I speak about the Tariff (Free Trade Agreement between New Zealand and the Republic of Korea) Amendment Bill itself, I would like to talk about the World Trade Organization (WTO) and why it is important for us to have free-trade agreements. We all understand that the World Trade Organization played a very important role in developing the world economy. It now has 153 members. It is important for New Zealand to be involved in the World Trade Organization because we are a small trading country. We need a multilateral organisation to support us in negotiations with larger trading partners simply because, under the World Trade Organization rules, beneficial terms agreed bilaterally with one trading partner will also apply to the rest of the WTO members. Also, there is a very good dispute settlement mechanism in the World Trade Organization, which is helpful to small trading countries like New Zealand.

However, we are now facing many challenges because the World Trade Organization has not been very effective in the past decade or so. For many years the World Trade Organization and its predecessor, GATT, or the General Agreement on Tariffs and Trade—played a very important role from 1948 to 1995, when the World Trade Organization officially commenced. Since 2001, when the Doha development round was launched, we have not been able to make major progress simply because there are too many disagreements or different views or interests among the members. Look at this: from 1948 to 1994 GATT—the predecessor of the WTO—received 124 notifications of trade agreements, while since 1995 over 300 trade agreements have been enacted. That highlights the importance of regional trade agreements or bilateral trade agreements in the wake of the ineffectiveness of the World Trade Organization. So that is why we need to focus on free-trade agreements.

Another example, to highlight the importance of free-trade agreements, is our free-trade agreement with China. Many members have mentioned the free-trade agreement with China. New Zealand has a few firsts with China. It was the first developed country to recognise China’s market economy status. It was the first developed, or OECD, country to conclude negotiations with China regarding China’s entry into the World Trade Organization. New Zealand was the first to start free-trade agreement negotiations with China, and was also the first developed country to conclude free-trade agreement negotiations with China. They were concluded in 2008. Since then our exports to China have risen from $2.3 billion in 2008 to over $10 billion in 2014. Our imports also increased, from $5.8 billion to $7.7 billion in 2012. Our exports increased more than our imports so the free-trade agreement with China certainly has been in our favour. It is important for us to expand our market overseas, particularly in north-east Asia. Korea is also a part of north-east Asia—I will talk about this later. Because our trade with China has grown so fast and so well, we have now set a new target for bilateral trade between New Zealand and China. In 2010 Prime Minister John Key had an agreement with Chinese Premier Wen Jiabao that was to increase our trade from $10 billion to $20 billion from 2010 to 2015. Then last year, when the Prime Minister was talking to Chinese President Xi Jinping in Beijing, the two sides agreed to increase our trade from $20 billion to $30 billion by 2020. So that is another target.

North-east Asia has become particularly important. China is part of north-east Asia; Korea is part of north-east Asia. In the 1970s north-east Asia accounted for just 10 percent of our exports, but now north-east Asia accounts for over 40 percent of our exports. So China, Japan, Korea—then you have Hong Kong, Taiwan—these economies are particularly important. That is why we do need to pay attention to this region, and that is why this free-trade agreement with South Korea is particularly important. We all know that South Korea is our sixth-largest trading partner—actually, according to some people, earlier this year South Korea actually became the fifth-largest trading partner for New Zealand. South Korea is our natural trading partner, like many other countries, because we export mainly our agricultural products, while South Korea exports mainly manufactured products. So we have this mutual benefit to expand our trade, and, of course, when we trade we also need to recognise the importance of other dimensions of our relationships. For example, when we do trade it also means that we have more contact with other countries and, therefore, we have better understanding, which will help our tourism, our education industry—all these things.

To come back to the New Zealand - Korea Free Trade Agreement, one particular reason why we need to have a free-trade agreement with South Korea is that South Korea has already had free-trade agreements with some major trading partners, which means that our products in South Korea are basically discriminated against. For example, South Korea has negotiated free-trade agreements with the United States, Chile, the European Union, Australia, and Canada. So these countries have advantages in the Korean market and that means more challenges to New Zealand. This free-trade agreement will make New Zealand products more competitive and will secure the long-term future of New Zealand exports in the Korean market. We received many submissions, of course, at the hearing stage. I could quote a few. For example, here is the Korea New Zealand Business Council. It said: “the agreement overall is a huge advance for New Zealand in the Korean market and is to be absolutely welcomed. It will in due course eliminate the disadvantages our exporters have been suffering from through Korea’s previously agreed FTAs. It will assist, over time, most of our exporters to increase their exports to that country.” I commend this bill to the House. Thank you.

A party vote was called for on the question, That the Tariff (Free Trade Agreement between New Zealand and the Republic of Korea) Amendment Bill be now read a first time.

Ayes 95

New Zealand National 59; New Zealand Labour 32; Māori Party 2; ACT New Zealand 1; United Future 1.

Noes 26

Green Party 14; New Zealand First 12.

Bill read a first time.

Bill referred to the Foreign Affairs, Defence and Trade Committee.

Hon MICHAEL WOODHOUSE (Minister of Immigration) on behalf of the Minister of Trade: I move, That the Tariff (Free Trade Agreement between New Zealand and the Republic of Korea) Amendment Bill be reported to the House by 3 November 2015.

Motion agreed to.

Bills

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

Second Reading

Debate resumed from 4 June.

TODD MULLER (National—Bay of Plenty): I rise to make some concluding remarks in the second reading of the Exclusive Economic Zone and Continental Shelf (Environmental Effects) (Transitional Provisions) Amendment Bill, and I ask the House whether I can perhaps refer to it as just the bill from now on. The bill makes a small technical amendment to the Act to ensure a sensible transition of existing petroleum operators into the new regime. We have four petroleum production operators in the exclusive economic zone, all off the coast of Taranaki—that fantastic area, which is, of course, incredibly well served by Barbara Kuriger—and all crucial for New Zealand’s oil and gas supply. All of them have been operating well but need to be brought seamlessly into the regime without compromising their supply. The current transitional provisions in the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act require existing operators to undertake the marine consenting process before their pre-existing permits expire. This bill allows simply for operators to continue operating while their new marine consent applications are being considered by the Environmental Protection Authority.

The bill also provides certainty of operation throughout any subsequent objections and appeals, and that is, of course, potentially where we are with Shell Todd Oil Services at the moment. I think what is really important, though, is to note that the bill does not change the requirement to apply for a marine consent. Operators are still required to provide an impact assessment on the nature of their activities and are still required to identify measures to avoid, remedy, or mitigate any adverse effects.

The select committee spent quite a lot of its time reflecting on the transitional provisions, particularly section 162 of the current Act. If I can quote from that Act, it allows existing petroleum mining activities involving structures or pipelines that are permitted under the Crown Minerals Act regime to continue without a marine consent for the duration of the operator’s mining permits or privileges as they were on the day before that Act came into force. But, critically, it does not allow existing operators to continue their activities while a marine consent application is being considered and any appeal is being determined. So, as you would expect, that was a challenge for us, and we needed to resolve that. We cannot have situations where, essentially, existing operators need to have been granted a marine consent before their mining permit or privilege expires and they find themselves potentially continuing to operate in breach.

We spent quite a lot of time, as a select committee, reflecting on whether the current operators could, essentially, game the framework in any way by delaying the time of their application for a new permit and consent until the very last moment and then tying up the review process in years of legal wrangling. I guess there was a legal perspective that was brought to the debate by both members of the committee and those who were providing submissions, but also I think that at times the debate lacked commercial rigour. From my perspective—just reflecting on some of my experience in recent years, particularly with Fonterra—the idea that you would deliberately wait until the very last minute to put in an application when you have such a significant part of your business at stake, which is being enabled by a particular consent or permit, is very unlikely. Certainly, from my experience, it just simply does not happen, because the business continuity risks are significant, and if you are in the commercial world, your senior management and, indeed, your governors hold your feet to the fire to ensure that you are managing your regulatory compliance—particularly any consents and the rollover of those—in a way that absolutely assures business continuity. So some of the debate in the select committee around the fact that somehow our oil and petrol - producing companies would be gaming this by trying to wait until the very, very last minute simply did not wash with me.

We did amend clause 4 of the proposed bill, which amends section 162 of the principal Act, to require existing operators to apply for a marine consent 9 months prior to the expiry of their permit and for that application to be acknowledged as complete by the Environmental Protection Authority. There was quite a lot of debate as to whether this should be 6 months, 9 months, or 12 months. I think we have landed in the right spot. Actually, I think the credit for that should go to our chairman, Mr Scott Simpson, who has shown, yet again, that he has a very good way of managing a process, reflecting on the various perspectives in the room in order to get the right outcome in terms of the legislative outcome. I think that we have got an outcome here that will work quite well. We have amended clause 4 further by putting in new section 162(5) to clarify that existing mining activities that are past the expiry date of a mining permit or privilege can continue until the application is decided by the Environmental Protection Agency and appeals are determined, and I think that is very useful.

Perhaps the only closing comment is that we had a number of submitters. Most of them were perhaps light in terms of understanding the details of this. The Petroleum Exploration and Production Association, of course, was not very supportive of change, but I think one message it could take away from our select committee deliberations is that it does have a role, in my view, in working with the oil companies to ensure that they are very aware of their obligations in terms of timing and sequencing of their particular consent renewals. There was just a touch of a hands-off approach from the Petroleum Exploration and Production Association, which I think did not serve it particularly well. I look forward to this bill progressing through the House.

JOANNE HAYES (National): I rise to take a call on this Exclusive Economic Zone and Continental Shelf (Environmental Effects) (Transitional Provisions) Amendment Bill in the name of the Hon Nick Smith, and thank you, Mr Assistant Speaker, for allowing me to stand. Yes, this is a very narrowly focused bill, and it does mean that it will allow our oil and gas operators to be able to continue to operate their businesses while their consents are being processed through the decision-making committee appointed by the Environmental Protection Authority. I am pleased to note that on 4 June this year, just not long ago, the decision-making committee granted Shell Todd Oil Services a 35-year consent based on some conditions. Those conditions were around just a couple of the Māui gas field platforms out on the Taranaki Basin. I am really pleased that Shell Todd Oil Services was able to get its consent approved for 35 years, because it is, along with the other three oil companies, a major economic deliverer for this country—20 percent of GDP in this economy comes from the oil and gas industry.

We cannot, as a Government and as people of New Zealand, let our marine consent process be upset through this whole process. I am really pleased that we were able to do something about this. My colleague Todd Muller, the previous speaker, talked about the amendments to sections 162(4) and 162(5) of the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act in clause 4 of this bill. Under the old section 162(4), the organisation applying for the marine consent was not allowed to operate past the expiry date. That is really key, because we cannot have that happen. It would actually affect our economy, big time. So then the Local Government and Environment Committee looked at amending new section 162(5), and that allowed the organisations to continue to run their operations past their expiry dates until the Environmental Protection Authority confirmed their marine consents.

I just want to talk a little bit about the fact that this Government is a Government that tackles the hard things that have gone on in our country, like environmental protection. We were the Government that brought in the Environmental Protection Authority. We were the Government that brought in the exclusive economic zone. We are a Government that sets up 44 marine reserves—44 marine reserves, because—

Matt Doocey: We care.

JOANNE HAYES: That is right. Yes, we do care. We care a lot about this country, and I am really ashamed that we had a Clark Government for 9 long years—shaky, scary years—when there was no environmental protection, even though it drilled 34 wells that nobody in this country knew about.

Hon Member: Rubbish!

JOANNE HAYES: When I hear people on the other side say “Rubbish!”, that is most probably because they too did not know that was happening within their own Government.

So when we start to look at things like that, this is a Government that tackles all the hard things. We have tackled environmental protection—44 marine reserves. We have got these oil and gas companies their marine consents, and we have worked through all of those. We are very, very pleased that we were able to do that transitional tinkering within there to make sure that we protect those four major companies. When I travel up to Taranaki and I look around at Taranaki, I look at the effects that these four major players have had on that region. I do not see too many people from Taranaki walking around dragging their lips and thinking: “Our economy really sucks up here.”, because it does not. It does not, and it is all attributed to our oil and gas companies up there in Taranaki.

I also look at some of the things that are happening with iwi up there to do with that area, because the iwi have actually bought into that. They are actually part and parcel of consultation under the Environmental Protection Authority.

Stuart Nash: What’s this got to do with the bill?

JOANNE HAYES: It has got everything to do with it. It has got absolutely everything to do with this particular clause.

Stuart Nash: It’s a very narrow piece of legislation.

JOANNE HAYES: It is a very narrow bill, Mr Nash. Of course it is very narrow, but it has wide implications for everybody.

Scott Simpson: You’ve hit a nerve, Jo.

JOANNE HAYES: I know I have hit a nerve. It is just amazing. But when you start to look at it, 20 percent of our GDP comes from our oil and gas businesses. That is about $2 billion added to our GDP, and we take about $800,000 worth of taxes and royalties, and where do we put that? We put that within the health industry, to support the health industry, to support education, and to support roading and our infrastructure. That is where we put that funding. What kind of business could we replace that with? We cannot. We have minerals, we have various resources in this country, and we have to make sure that we are able to utilise those areas with all the protections in place, and that we are also doing this in an important, environmentally friendly way so that the economy benefits and everybody benefits.

When I look at the marine reserves, those marine reserves actually protect them from oil and gas and petroleum drilling. Those are the rules around that, and that is why I am surprised that I have people from the Opposition benches over in the Greens who do not like this. They will not support it, and I find that it is not very good when we have got Opposition benches not supporting the slight tinkering that will enable our economy to carry on and grow in the way that it is growing.

I want to extend my thanks to Scott Simpson. Scott is our chair of our Local Government and Environment Committee. I sat with Scott on the previous committee that he chaired, and he runs a very fair and open process. He allows everybody to have input with respect, and that is, I believe, what makes him a very good chair of any select committee, actually. Even when we gained those five submissions on this bill—they were from groups and individuals. Two of those five submitters came along and spoke to our committee, with the deepest respect.

I believe that this has been a very open process from the start of it, at the start of 2015, through when the submissions closed on 9 April 2015, to here at the second reading. I look forward to going into the Committee of the whole House process and then moving into the third reading of this bill. I look forward to it. I am proud of the work that this Government continues to do for this country, because this is a Government that cares for the people and we care for our economy. For any other party that does not think like that, then shame—shame—shame on you. I wholeheartedly support and commend this bill to the House. Thank you.

GARETH HUGHES (Green): Kia ora, Mr Assistant Speaker. Ngā mihi nui ki a koutou. Kia ora. I rise to support this bill, which I guess just absolutely refutes the last speaker, Joanne Hayes, who—woefully ignorant—railed on about Opposition parties opposing it. Clearly, the member has not been listening and maybe she should be paying more attention. The Green Party stands for a greener, cleaner future, so in the first reading we did oppose the bill because we had serious concerns that it was not on for this Parliament, using the most awesome power of this House, which is to make legislation, to pass laws to benefit a single oil company. The Government had not made the case.

The fact is that Shell Todd Oil Services had botched the job of applying for a marine consent for its wells. What the records, in fact, uncovered is this particular company ran to Cabinet before it had even put in its application, when it realised that it had its time lines all wrong and that it would not get its marine consent application in on time if there were any appeals. It is absolutely staggering that a company that appeared in front of the Local Government and Environment Committee on the exclusive economic zone legislation—a company that had been involved, along with the wider oil industry, in the consideration around the exclusive economic zone legislation, legislation that had to be fixed two more times because of Government botches in terms of the original drafting, in terms of that rushed job—did not work out how soon it had to get a marine consent application in. Instead of actually putting in the application, it ran to Cabinet.

Of course, Cabinet said: “Sure, we’ll pass a law that benefits you in particular, because you’re an oil company and we’ll do anything for oil companies, including tens of millions of dollars of subsidies, in terms of the fourth-lowest tax plus royalty rate in the world, and in terms of calling out the navy when iwi fishermen get in your way.”—a Government that will do anything to drill it, mine it, frack it across New Zealand. At the time, this sure did look like one law for oil. It looked like the Government trying to fix a loophole for a specific company.

But I am also proud to say that the Green Party was able to improve the legislation with two significant amendments in the select committee. So we would like to acknowledge the submitters. We would like to acknowledge the committee, the officials, and the chair, Mr Simpson, and we would like to acknowledge the two changes. This legislation, this amendment bill that we are debating, essentially gives those companies that apply for a marine consent in the exclusive economic zone, for example, for oil drilling or gas mining in terms of seabed mining—if they put in an application before their existing permit expires, this amendment allows them to continue the operation until they successfully get a permit.

Two concerns here were that, under the original drafting of the legislation, essentially any company could wait until the last day of its existing marine permit before bothering to put in a new application because it knew it would be covered under the awesome power of this House. It could continue operating for as long as the process and the appeals would take. Plainly, that is ridiculous. It incentivises bad behaviour, such as putting in an application incredibly late. A company could do it hours before its existing permit expired and still be kosher under this legislation. So we were happy to amend new section 162(5) in clause 4 to introduce a 9-month window. This means that companies have to apply 9 months before their existing permit expires if they are going to benefit from the amendments contained in this legislation. That is consistent with other legislation such as the Resource Management Act. It is a way that we can incentivise these companies to make sure they get their applications in on time. We cannot have these “The dog ate my homework.” arguments that we have heard from the likes of Shell Todd Oil Services.

The second amendment to improve the legislation argued by the Green members was that we needed a definition of “marine consent”. Under the original legislation the wording was fuzzy. It could have been argued that simply lodging an application was sufficient, or did the application have to be signed off as complete? In terms of some of the applications the Environmental Protection Authority has received—for example, the Trans-Tasman Resources case—three whole pages of additional information was requested by the authority in that application because it was not completed. So we have tightened up the legislation in terms of it having to be a complete consent application. So we have explained our original concerns. We have explained how the bill has been improved by the Green Party and that is why we will be supporting it.

Ultimately this is a very small matter compared with the Government’s fossil fuel agenda, which is simply massive in terms of all the taxpayer subsidies, in terms of all the moral and legislative support, and in terms of all the things the Government is doing. It is a shame because we know the future is in terms of the clean-energy economy. We know we have tremendous opportunities. We know from US data that there are four times more jobs in clean energy than there are in fossil fuels. We have international bodies such as the OECD and the International Energy Agency calling for an end to the more than $500 billion in global subsidies for fossil fuels.

So perhaps the major opportunity cost of this legislation in terms of the submitters’ time, the officials’ time, this House’s time, and the select committee’s time is that we could have used this time to build, to foster, and to empower a clean-energy economy, which is where the international capital markets are going, which is where the scientists are urging us to go to if we want to avoid the worst of catastrophic climate change, and which is where real prosperity is going to come from. Instead of passing one law for oil, in fact, what this Parliament should be debating is the separation of oil and State. What we need to see is a fair go given for clean energy. Although we are opposed to the continuing fossil fuel agenda, we can support this legislation, which has been improved, and I would like to thank the members and the officials involved.

On the last note, I would like to voice one last note of disappointment that the very company involved in this legislation, the very company that singlehandedly benefits from this legislation–Shell Todd Oil Services—did not bother to front up to the select committee. There were wide questions on the urgency and the need for this legislation. We saw Nick Smith get it incredibly wrong; I guess there is a bit of a track record there. He exaggerated on the day this legislation was announced, saying that 40 percent of the country’s gas supply was at risk, when in fact it was around 20 percent—more than 50 percent wrong. We have not seen from either the Government or Shell Todd Oil Services any information regarding what would happen if this legislation was not passed. We now know that Shell Todd Oil Services successfully got its consent. Gas supply was never at risk. Was the question simply that this company would be charged extra for its long-term gas supply contracts if it could not fulfil them, or was there a serious gas supply problem that would have affected New Zealand households, New Zealand stoves, and New Zealand industrial facilities?

These questions were never answered, and it was disappointing that the lobby group for the oil industry, the Petroleum Exploration and Production Association of New Zealand, came along, but it could not answer a single detailed question when it came to this company benefiting. It is an awesome power of this House when we pass laws that benefit a single company, particularly when it is a company dealing in the oil industry, which we know has such a serious impact on our global climate and on the climate security for us, for our kids, and for our future generations. It was disappointing that it could not come.

So let us move forward from this. Let us embrace the green-energy economy. Let us look at getting an effective carbon signal through a carbon tax cut. Let us get a green investment bank in place. Let us make it about a fair go for clean energy, because when you are an outside observer, you see all the steps that this Government is doing for fossil fuels including this, yet on the other hand you see New Zealand entirely slipping off the renewable energy global index. Saudi Arabia, of all countries, has taken our place. We have slipped off it entirely. There is a host of smart, innovative, productive steps that this Parliament could be taking and this Government could be showing with leadership, and that is what the Green Party is going to continue to champion. Thank you for the opportunity. Kia ora.

RON MARK (NZ First): This is a very short bill, and as is so often the pattern when you get a bill of this size going through the House and everybody is in agreement that the bill should proceed, the challenge is trying to find something that has not been said already.

I sat in my office and watched a bit of the House on the telly, and I am going to say again—and some people might start to think this is a bit monotonous—that the difference in the way in which the Local Government and Environment Committee operates and the way in which I am witnessing some of the other select committees operate, with their consequential reports back to the House, is really quite astonishing. It really is quite astonishing. I have to say watch out to some of the front-bench members of the National Party, because there are some backbench members of your caucus chairing and deputy chairing select committees who have got all the talent and all the skills to take the place of people like Nick Smith, who quite clearly—looking at this legislation and how it got to be here—cannot do his damn job properly. He continues to fall over. I mean, why are here? Why have we spent this fortune?

In terms of the way in which this legislation has been managed through the select committee, I take my hat off to the National Party team, because at one stage the bill was set to provide a 6-month transition period. Through some sensible discussion and some cooperative dialogue the select committee unanimously agreed that 9 months was more sensible and a nice compromise. Some wanted 12 months. It started out as 6 months. So the bill has arrived here at the report back with a 9-month clause, which we will deal with in the Committee stage. The tone, the flavour, the way in which the Local Government and Environment Committee operates is, I think, a credit to the House. I think it is a credit to the members who sit on it. It is a credit to the chair and the deputy chair, and to the Opposition parties that sit at the table as well.

Speaking of the bill, New Zealand First will support it. I have to say, how bad do you have to be, when you are a corporation as big as Shell Todd Oil Services, to get this wrong? The only reason this legislation is here, quite frankly, is that, as far as I can see, Shell Todd Oil Services got it wrong. It mucked up. It went running and screaming to the Government. It told the Government it needed to jump. The Government said: “How high?”, and it said: “High enough to change the legislation.” So here we are, and many, many months later we have got the bill going through the House and we are carefully scraping the egg off Shell Todd Oil Services’ face.

But I have to contrast this with what I see is happening up in Auckland and how Ngāti Whātua have been treated in terms of the first right of refusal. It seems that if you are big enough, bold enough, and worth billions of dollars the Government will spin on a sixpence, but if you have negotiated for 12 years on a Treaty settlement and you have a right of first refusal, suddenly it does not exist.

I look at this legislation and I think how easy it is to actually put into place something sensible that is fair to all parties. The Government could have chosen to do nothing here. How embarrassing would that have been? How detrimental would it have been to the company’s operations and how detrimental would it have been to the jobs and the lives of those people employed? The sensible solution was to change the legislation.

Quite clearly the legislation, if I may be quite boring and read parts of it: “seeks to amend section 162 of the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act 2012.” The clause that has been adjusted is very simple. It allows operators to continue operating following the expiry of a permit or privilege until operators have lodged a marine consent. It actually gives them a time. It specifies a time by which they must lodge their consents and get them cleared through. It is not an open cheque book.

The commentary on the bill states: “The bill would allow operators to continue mining while their consent application was in progress and any appeals were determined. The purpose of the bill is to provide greater certainty to petroleum mining companies operating in the Exclusive Economic Zone, and to help their transition to the 2012 Act’s regulations.” That is all sensible stuff, so there is not really a lot more I can say. New Zealand First agrees with the clauses dealing with mining with a marine consent. We are quite easy, I guess, with the fact that this is a sensible change.

My colleague Fletcher Tabuteau spoke in the first reading. I think he had a few terse words for the Minister, and he did make it clear to the Government that we felt then that this was a bit of a stuff-up. Quite clearly, it has been, and from where I sit now, having sat on the select committee, I can see that the people who did get it wrong were in Shell Todd Oil Services. Hopefully, that is a lesson to be learnt by them. Hopefully, anyone else out there—and I did make this point at the select committee—now understands the need to plan ahead. I would have thought that a company that big would do those things naturally, but clearly not.

I did draw in the select committee phase a parallel with councils. I guess Shell Todd Oil Services could buy and sell the tiny little old Carterton District Council a hundred times over. We have issues around resource consents and compliance, and we have to ensure that when our consents are about to expire, we get the applications in on time and that those consents, at best, do not expire and, at worst, are in progress at the time they do, and that we get the extensions to them when such occasions arise.

Generally speaking, local government throughout New Zealand deals with this sort of matter all the time, and if it is not on top of its game for its water takes and its water discharges, then things get messy. I just do not for the life of me understand how a multibillion-dollar organisation like this can get things so badly wrong and require us to be sitting in the House passing legislation.

I will conclude by saying congratulations to the team. The Local Government and Environment Committee is a great team to work with. I am enjoying the work there.

This is a small bill. I do not think there is much more to be said, but I guess we will have to say it all again during the Committee stage. Kia ora.

The ASSISTANT SPEAKER (Lindsay Tisch): The next call is a split call. I call Eugenie Sage—5 minutes.

EUGENIE SAGE (Green): I am pleased to take a short call on the Exclusive Economic Zone and Continental Shelf (Environmental Effects) (Transitional Provisions) Amendment Bill. The Green Party opposed this bill at its first reading because it appeared to be another example of the Government amending the law to provide preferential treatment to industry to benefit corporate interests, and in this particular case to benefit Shell Todd Oil Services so it could continue to operate the Māui gasfield. If the company did not have a new marine consent by 27 June, then it would have be in breach of the principal exclusive economic zone Act, and it would have to stop operating.

With the benefit of submissions and advice from officials at the select committee, and with the changes that Opposition members encouraged the Government members to support, we will now be supporting this bill. The advice was quite helpful. It turned out that Shell Todd Oil Services had actually notified the Environmental Protection Authority in June last year of its intention to lodge a marine consent application. It provided a draft impact assessment in September and actually lodged the application in November.

The Green Party wants a robust process for the Environmental Protection Authority to consider these applications so their impacts can be thoroughly investigated, assessed, and considered. The changes that the select committee is making to the bill provide for that. The bill will not allow any existing operator to continue to operate unless it applies at least 9 months before its existing permit or privilege under the Crown Minerals Act expires and it files a complete application for a marine consent with the Environmental Protection Authority. This change ensures that in the 9-month period the full decision process can be gone through by the authority. It does not allow enough time for appeals to be considered, but it is a significant improvement on the bill as introduced. We thank submitters for drawing their concerns to the committee’s attention, and we thank officials for their work.

Although the Environmental Protection Authority has recently granted consent to Shell Todd Oil Services, the next of the existing operators that would be likely to use this provision in the Act is Tūī. Its existing permit and privileges expire in November 2025. We hope it will get its head around the processes well before then.

One of the things that was really disappointing was that Shell Todd Oil Services did not make a submission. It did not come to the select committee, and we were not able to question it about the extent to which the Māui gas supply would be disrupted if the bill did not go through. We certainly do not want Kiwis going without gas, but now that Shell Todd Oil Services is a swing producer for that field, it is no longer the dominant producer of gas. So, potentially, a temporary stop in production could be met by supply from other operators. But we did not get the chance to ask it that.

One of our major concerns in the whole marine space is that the same Minister who is responsible for this bill has been talking repeatedly about introducing new marine reserves legislation, but that is yet to come to this House. This bill can be introduced and put through the parliamentary process fairly quickly, yet we have been waiting over a decade for new marine reserves legislation. The Māui A and B platforms are 33 and 38 kilometres offshore respectively. We do not have any deep-sea marine reserves. We have got a Government that is encouraging more exploitation of oil and gas, even though there is strong scientific evidence that we cannot burn up to 50 percent of our existing reserves without frying the climate. We need to have more marine protection rather than an encouragement of more oil extraction. This Government needs to bring a marine reserves bill to the House so we can have some deep-sea marine protection and not just accommodate the oil and gas industry. Thank you.

The ASSISTANT SPEAKER (Lindsay Tisch): Su’a William Sio—5 minutes.

Su’a WILLIAM SIO (Labour—Māngere): The Government often thinks that by supporting the oil industry—and it tends to focus one-sidedly on the economics—all will be well. But we know that despite the best efforts, and despite the money that the industry says it has and is prepared to mitigate disasters with, disasters do happen. When they happen it is the general population that suffers, it is our environment that suffers, and it is also nature that suffers. I just make that point because often I am hearing speeches from the other side from members who forget about the other side of the argument and then try to maintain a balance. This legislation, and the improvements made by the Local Government and Environment Committee, is about protecting the environment and maintaining the balance.

I want to caution the Government because with regard to the original legislation in 2012 we said that the Government was rushing through it, but of course, it did not care. It did not care one iota. It rushed it through. What we got was mistakes made in weak legislation, and now we are having to spend this time improving the legislation that the Government introduced in 2012.

I want to read a couple of statements made by the submitters. There were not a lot of submitters, but for the submitters who took the time I think it is worthy that we acknowledge their submissions. It is also worthy that they brought a different angle to this particular debate. Tanea Tangaroa made this submission: “We are not happy with the way this government is treating our whanau hapu and the lack of integrity and respect towards our tikanga and kawa. We are not happy with the current oil and gas explorations that are already operating in the eez and the response to the oil spills …”. The point he made in the entirety of that submission is concern about protecting the environment, and often the industry does not seem to care.

I want to read out another extract, from Frack Free Kapiti and Beyond. This was its submission: “While the intention of this amendment is to not interrupt the flow of gas to New Zealanders, the amendment seems to offer existing operators an open ended timeframe in which to operate completely outside of New Zealand’s EEZ Act …”, and it then listed three recommendations that it advised the select committee to undertake. Linda Hill of the Kāpiti Coast said: “I strongly object to this legislation amendment, because it grants special privileges to the petroleum industry which undermine the parliamentary purpose and effective operation of the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act 2012 … All companies have known since September 2012 what EEZ Act says …”.

The submitters have a point. I think, to be fair, the members of the select committee took on board those submissions. We were not necessarily able to address the concerns that they had, but one concern that was tabled before the select committee, and which the select committee took on board, was the fact that we have to put some limitations on the companies in terms of the time frame that they would have for the transition.

I am happy to say—and my colleague from New Zealand First Ron Mark is absolutely correct, as well as the members from the Green Party—that it was actually the Opposition members who made the suggestion to the members of the Government that by adopting these recommendations they would actually improve the legislation. I am pleased to say that the Government members on the select committee were able to hear those voices of common sense and accept the recommendations. I cannot say that for the Minister who introduced the original legislation and who is responsible for it, because I think it shows her recklessness in rushing through legislation and her recklessness in failing to accept the fact that our select committee process is designed to enable significant input from individuals and our community and from people who know what they are talking about, and the fact that by so accepting that advice, it enables whichever Government is in to improve on the piece of legislation that it has.

So I will just caution the Government. I think that through its arrogance and its forgetting that it is there because of the goodwill of New Zealanders—do not take that for granted. I would say to the Government that it was only through—

The ASSISTANT SPEAKER (Lindsay Tisch): Order! The member’s time has expired.

MATT DOOCEY (National—Waimakariri): It is a pleasure to rise in support of this very important bill, the Exclusive Economic Zone and Continental Shelf (Environmental Effects) (Transitional Provisions) Amendment Bill. As I rise to speak to this bill and reflect on what I have heard through the second reading, I have heard it all. Mr Cunliffe said in the second reading that this bill was a pooper scooper. That just reflects just how irresponsible this Opposition is, because this bill reflects things that are important to New Zealanders—the environment and the economy.

This National Government cares—it cares about the environment and it cares about the economy. That is why everyday New Zealanders trust us. They trust us to care about protecting the environment and they trust us to care about supporting the growth of our economy. I think they demonstrated very clearly in September last year whom they trust. They trust this National Government.

In this speech I want to touch on a few key things that happened through the process that takes us up to this second reading. I must say, as a new MP following this bill through, that it has been a very informative and learning process seeing this bill go through its first reading and go back to the Local Government and Environment Committee, hearing the submissions, the learning from that, and the discussions across the table and the very collegial decision-making that has formed a very smart piece of legislation.

I want to touch on the flexibility of section 162 of the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act 2012 and how that is a key to ensuring that there is investment certainty and business continuity in this sector. I also want to touch on how the consequences will play out in New Zealand if we do not get this bill right. I also want to talk about the specified time frames for applying for a marine consent and how very important that is to this whole bill.

If we look at the consequences of not getting this bill correct, we know, through the regulatory impact statement, that if Shell Todd Oil Services ceased to explore and extract gas that would have a significant impact on New Zealand’s economy. We know that Shell Todd Oil Services operates at the Māui gas field, which is 26 percent of New Zealand’s gas supply. We also know that it is a big employer in the Taranaki region. I have my colleague to my right, the very able MP for Taranaki - King Country, Barbara Kuriger, who, her constituents can rest assured, is already making a significant mark in Parliament and in her electorate. We know that Shell Todd Oil Services is a big employer of 300 people in the region, so the gas sector is very important to New Zealand’s well-being, the well-being of our environment, and the well-being of our economy.

It is very much the Pareto ratio. We know that the Pareto ratio is 80:20, and 80 percent of the gas consumed from Māui feeds 20 percent of sites, which include petrochemical, electricity generation, and large industrial users that support our export economy. Every New Zealander knows that it is the export economy that drives forward the well-being, the wealth, and the success of this country, and that it is something that we need to protect.

The regulatory impact statement also clearly outlined how in 2011 when there was an outage in Māui for 5 days, the knock-on effect of that—

The ASSISTANT SPEAKER (Lindsay Tisch): I am sorry to interrupt the honourable member. The time has come for me to leave the Chair for the dinner break. This debate is interrupted and I shall resume the Chair at 7.30 p.m.

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

MATT DOOCEY: Before the dinner break I was talking about the consequences of this very important legislation and the consequences if we did not have this important bill. I was quoting the regulatory impact statement, which acknowledges that in 2011 there was a 5-day outage in Māui and that the cost to gas consumers was over $200 million a day. At $40 million a day it is important and imperative that this legislation and these regimes are not only protecting the environment but our economy as well.

A key issue of this bill in the select committee process was very much about the specified time frames and the time frames of applying for a marine consent. For a new MP, to watch this process play out was very informative. There was a lot of learning, and it was great to be part of that and to see how decisions are made based on the evidence put forward. The select committee sought advice to understand the different time frames that it could look at for this bill and very much it was about looking at what time frame an operator would need to submit their application for a marine consent.

The first option—it was one of three, the first being at 6 months. This looked quite an interesting suggestion. On first look, it actually looked a very good one when it looked at the benchmarking compared with the current Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act 2012 as well as benchmarking against the Resource Management Act with the date of 6 months around consenting. There was also a comparison made around the Crown Minerals Act with extending a mining permit around the 6-month mark. But where it came unstuck was around the need for 140 days, which is the statutory time frame for the Environmental Protection Agency consideration and, of course, appeals and objections—140 days did not fit into the 6 months. Twelve months did seem quite a good period of time as well but possibly a bit too long, so the select committee settled for the 9-month period for the time frame for the application for marine consent to be submitted, which would allow for the full 140-day statutory time frame as well as 15 days allowed for appeals and objections.

We did have five submissions and two of these were heard orally. We had Frack Free Kapiti and Beyond, and they thought this seemed to be offering operators an open-ended time frame. This seemed to be a theme that came through a lot of the discussions. Also, allowing existing operators to continue activities that might need to be mitigated against came through too. I would make reference to this National Government bringing in this Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act entirely for this reason: to regulate where previously there was no regulation.

Having an open-ended time frame is important because something that Kiwis value—and our colleagues over in the Green Party would suggest it is only them and their members who have the best interests of the environment at heart, but protecting, supporting, and enabling the environment is actually intrinsic to every Kiwi. It is intrinsic to every New Zealander. It is right to have an ability that is somewhat open-ended for any New Zealander who feels like they would like to make a submission around this marine consent to be heard. I welcome that, and I think that is very good. It is very good for accessibility. It is very good for transparency, and it is fantastic for public involvement, as all New Zealanders want to protect their environment for the future and for their children.

There was an issue around the flexibility of section 162, which provided a real uncertainty for investment for these petroleum operators but also around business continuity. We heard from one of the submitters who was supporting the industry, the Petroleum Exploration and Production Association of New Zealand, which was representing petroleum operators, other stakeholders, and individuals involved in the sector. I must say that at the end of the day I think the association had a leadership role that possibly it did not enact. So overall it is a great bill and I support it to the Committee. Thank you.

ADRIAN RURAWHE (Labour—Te Tai Hauāuru): I rise to take a call in this debate, the second reading of the Exclusive Economic Zone and Continental Shelf (Environmental Effects) (Transitional Provisions) Amendment Bill. I have been listening very carefully to the contributions from both sides of the House. I think that the folks at home might be forgiven for not knowing who to blame as to why we are actually here tonight. I am here to tell you that it is the Government’s fault. It is absolutely the Government’s fault. It was told when the original Act was passed that we would be back in this House fixing it up. It could very well be called the “Fix It Up Bill” because that is why we are here right now to pass this legislation—to make it the best that it can be, because when it was first brought to this House it was not. We have heard kōrero in this House tonight that points the blame at the industry as well, to Shell Todd Oil Services. I do not think any business should be blamed for operating within the law that exists. I do not think it can be blamed for why this amendment bill is now required. It was acting totally within the law as it stands right now and that is why it needs to be changed.

It is not the first time we have had to debate bills in this House that have come back. There were 34 bills in the Statutes Amendment Bill (No 4) earlier in this Parliament and there have been others as well. This Government is creating a little legacy for itself I think. It is a legacy that says we did not get it right the first time because we rushed it through the House and now we have brought it back here to fix it up. Labour will be supporting this bill because of that fact. We cannot afford for the Māui Gas platform to shut down while the Government gets its act together. That is not going to work for our economy. That is not going to work for the jobs that Joanne Hayes in her contribution talked about. I can tell you that in the meetings I have had in my electorate in Taranaki, people there are very worried in the oil industry. There have been a number of job losses in this sector and I think these kinds of measures that we have to bring back to the House only serve to highlight that there are problems out in the regions. In a meeting that I had along with a number of my colleagues in New Plymouth on Friday last, those sorts of issues were raised with us. It is not the best use of time in this House. We could be debating much more important issues if the Government had got this Act right in the first place.

This bill, which is a lot better than the bill that was presented for first reading—and I want to acknowledge the work done by all of the members of the select committee in improving this beyond measure. Now we have a situation that can work. It can work for the industry and it can certainly work for employees who might be worried about their jobs. They might be worried because if this legislation were not here, then the Māui Gas platform might just shut down for days or weeks waiting for an application to be processed. I do not know if there are going to be objections, but certainly with these procedures a 9-month window for applications to be processed should have been included in the bill in the first place.

Our economy, the New Zealand economy, would do a lot better if we could get these procedures to be much more succinct in the first instance. Our international reputation—people around the world are surely looking at us and thinking: “What on earth are they doing? Why didn’t they get it right in the first instance?”. We find ourselves here and I cannot help but compare it to other things that are happening or not happening with the Government. I think it just shows that the Government is out of touch and I think it shows that the Government is arrogant.

I have to agree with the comments from the New Zealand First member Ron Mark when he raised the issue and compared it to what was happening in terms of housing and Ngāti Whātua, whom I met with last week as well. They are very concerned with these exact issues—that you could have a set of rules or set of principles that you might want to uphold for a piece of legislation like this one, the Exclusive Economic Zone and Continental Shelf (Environmental Effects) (Transitional Provisions) Amendment Bill here, which we are debating here, but you can have a different set of rules for someone else. The feedback that I get from my constituents around issues such as this is that it is just not fair. So I really encourage the members opposite to think really carefully about some of these bills that they rush through the House. This one is a prime example and I think there might be more. I think it is really important that we voice those concerns on behalf of our constituents.

I will talk a bit more about Shell Todd Oil Services, which owns and operates the Māui Gas platform. As I understand it, the company applied for the marine consent but there is just not enough time for that to be processed. This piece of legislation is about providing more time, basically, from my point of view—more time for a process that was flawed in the first instance. So I wonder whether this is not the last time that this Act is going to be amended. I think, from what I understand, that there are other instances as well that could cause this to be reviewed in the future. In spite of the concerns that we might have about what will happen with this Act in the future, it is better bill than it was at the first reading and that is why we will support this bill. Thank you.

NUK KORAKO (National): Kia ora e te Mana Whakawā. I am pleased to be the final speaker in the second reading of the Exclusive Economic Zone and Continental Shelf (Environmental Effects) (Transitional Provisions) Amendment Bill 2015. I want to thank the submitters, I want to thank the officials, and I want to thank the Local Government and Environment Committee members, in particular our chair, Scott Simpson, and his able deputy chair, Todd Muller.

Over the last two readings there has been a lot of discussion, a lot of toing and froing. The Opposition has its role; the Government has its role. Out of that we have heard words like “flexibility”, “consequences”, “specified time frames”, “world-leading legislation”—all of that. That is where I want to start. The original legislation we are proposing to amend is the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act 2012. This is a very, very significant piece of legislation in the history of New Zealand’s environmental management. Quite simply, the passing of that Act marked the first time we had ever had legislation requiring that the environmental effects of economic activities in our exclusive economic zone be actually monitored.

I have heard speeches from members on that side of the House, particularly from the last speaker, Adrian Rurawhe, denigrating that particular legislation. He is quite wrong. The members opposite have tried to claim throughout the readings of this bill that this is not true. They have tried to claim that it is not true. It is obviously quite difficult for them to accept that we have a better record on the environment than they do. They like to claim the moral high ground—the moral high ground—when it comes to the environment, and they do not like it when the evidence tells a completely different story. That original legislation, which I have just given an overview of, is very, very significant.

For my next point I want to come to the actual amendments of the bill. My learned colleague from Waimakariri, Matt Doocey, has actually presented a great overview of what the amendments are. Basically, in the end, though, looking at the amendments, they are quite minor but very, very important. We all agree it is somewhat disappointing that Shell Todd Oil Services did not apply earlier to prevent this ever being an issue. We accept that. Some of the submitters to the bill suggested that Shell Todd Oil Services should bear the natural consequences of this. But I am pleased, and I think we should all be pleased, with the fact that Shell Todd Oil Services has been granted the consent but is subject to a period for appeals to be lodged on points of law. But this bill makes it absolutely clear that operations can continue while any such appeals are heard, and that, again, is very significant.

There is more than just a company to think of here. Shutting down the Māui gasfield would interrupt 26 percent of the gas supply to New Zealand families and businesses, and it would have a major detrimental effect on our economy. In saying that, I think that most reasonable New Zealanders would agree that this is sufficient reason for us to act, and that is exactly what we are doing here. We cannot and will not let a technical correction such as this stand in the way of households and businesses that need the resources so they can carry out their normal daily and business activities.

I am not only a “brown blue”; I am also very proud to be a Bluegreen.

Hon Member: A what?

NUK KORAKO: I am very proud to be a Bluegreen because the Bluegreen team supports—we have supported and we are supporting—the first Government to properly manage the oceans that make our exclusive economic zone happen. This, again, is a significantly vital asset to New Zealand, both an environmental asset and an economic one.

It is shameful that that party opposite promised to introduce a proper regulatory regime in 1999 and did absolutely nothing. It did nothing to act on that promise, for 9 years. It is understandable that members opposite have tried to claim that they have a regulatory regime in place for our oceans. They are desperate to try to paint the previous Government with some kind of environmental credibility. But here is a lesson for that side of the House. It is fine to talk about something a lot, but when you look back on 9 long years and see no actual achievements, you realise—

The ASSISTANT SPEAKER (Lindsay Tisch): Order! Come back to the bill.

NUK KORAKO: —that the doing does count. Thank you, Mr Assistant Speaker. This Government promised to improve the management of our oceans, and we followed it up with the introduction of the exclusive economic zone and continental shelf environmental legislation in our first term. The legislation has been a huge step forward in our environmental management and a first for New Zealand. It brought us into line with international best practice and ensured that we can continue to benefit economically from the exclusive economic zone while preserving our environment for future generations.

I come back to this bill and the reflection on what this Government is doing. We all know—and that is why we have cross-party kotahitaka, togetherness, on this bill—and we all understand, particularly this Government, that our natural environment is our greatest asset. National leads the way by saying that successful economic and environmental policies must go hand in hand. This truly reflects the essence of why we need to amend this legislation. I have no hesitation in commending this bill to the House. Kia ora.

Bill read a second time.

Bills

Social Assistance (Portability to Cook Islands, Niue, and Tokelau) Bill

In Committee

Part 1 Preliminary provisions

CARMEL SEPULONI (Labour—Kelston): I am standing to speak to Part 1 of the Social Assistance (Portability to Cook Islands, Niue, and Tokelau) Bill. It is nice when we have a bill go through that every political party in the House agrees with, apart from some minor changes that have been suggested, which we can talk about.

The purpose of this bill is to allow eligible persons who reside in the Cook Islands, Niue, or Tokelau to be able to apply from either of those countries or that territory for New Zealand superannuation or a veterans pension, and be paid these benefits in either of those countries or that territory or other specified Pacific countries. Part 1 of the bill is really just outlining that purpose.

I actually think that many New Zealanders are not even aware of the fact that we have three countries that are not New Zealand—outside of New Zealand. They are three Pacific Islands that are part of the Realm of New Zealand, and therefore there is not necessarily an understanding or a knowledge of the special relationship that we have with these three countries, the Cook Islands, Niue, and Tokelau. I think that is a really important backdrop to discussing this bill, because it is important to understand not only the historical ties to these three countries but also the constitutional relationships we have with them.

Currently, eligible New Zealanders can receive their New Zealand superannuation or their veterans pension in the Realm countries, under the special portability arrangement that New Zealand has with 22 specified Pacific countries. However, under the current arrangement, people aged 65 years or older can only apply by being resident and present in New Zealand on the date they apply for New Zealand superannuation or a veterans pension. This bill seeks to change that so that those residents of Cook Island, Niuean, and Tokelauan descent can apply from those countries rather than having to be resident in New Zealand.

Part of this outlines the fact that they need to have been resident in New Zealand for 10 years. What is being proposed is that at least 5 of those years need to have been spent here, in New Zealand, between the ages of 50 and 65. I guess one point of difference, when we are discussing eligibility, between us—some of the minor parties, I think—and the National Government is that we think that those 10 years of residence, of being present in New Zealand, should not necessarily have to be between the ages of 50 and 65. Currently, it is proposed that 5 of those years resident in New Zealand must be when a person is aged between 50 and 65.

One of the big issues that came up not only during the submissions but it has come up during my own experience when getting out and about with our Cook Island, Niuean, and Tokelauan communities, and also visiting the Cook Islands and Niue, is the issue of depopulation and the impact that that has had on these three Island States. I think one thing that we as New Zealanders do not recognise at all, or enough, is the fact that the issues of depopulation that those three countries face really are due to the constitutional arrangements we have with them, in that those people are given the opportunity to travel freely to New Zealand. That is seen as a positive thing, but also we have depleted those three countries of their biggest resource. We have been told that by the residents there, as they struggle to be economically sustainable. Their biggest resource is their people.

So one of the good things about this bill is that it will allow our Cook Islands, Niue, and Tokelau residents to return to the Islands to be able to contribute to the economic development and sustainability of their countries. When we say that they need to have been in New Zealand, resident here and present, for 5 of their 10 years between the ages of 50 and 65, I think we are actually attaching what really is an unnecessary condition, because 10 years should be 10 years, whether it is 10 years between the ages of 20 and 30 or whether it be 10 years between the ages of 20 and 50. I cannot understand why we need to stipulate that 5 of those years must be spent here between the ages of 50 and 65. We want to, as part of the good-faith relationship that we have here in New Zealand with the Cook Islands, Niue, and Tokelau, actually support our Cook Islands, Niue, and Tokelau people returning to invest in those Island States, if that is what they wish. We see the benefits for those Island States, for their communities, and for their families, but also the benefit to New Zealand because they are part of the Realm of New Zealand.

I need to note that in Part 1 we are talking about eligibility, but later on tonight during this debate we will be debating and discussing a Supplementary Order Paper that has been put up by New Zealand First that actually removes that condition for them to have spent 5 of those 10 years in New Zealand, present and resident here, between the ages of 50 and 65. As I said, we want to support them returning.

When we talk about depopulation, again, I do not think most New Zealanders are aware of the extent of the depopulation that has occurred in Niue, the Cook Islands, and Tokelau because of the right to travel freely between those islands and New Zealand. If we look at the population statistics, I think the latest ones for Niue show there is a population of about 1,200 Niueans in Niue, whereas we have 24,000, approximately, Niueans in New Zealand. We have, approximately, 14,000 Cook Islanders in the Cook Islands whereas we have 60,000 Cook Islanders here in New Zealand. There are, approximately, 1,400 Tokelauans in Tokelau whereas we have about 8,000 Tokelauans in New Zealand. From the time that constitutional arrangement was formalised with New Zealand they have all made a contribution to this country. Now, I think, is an opportunity for New Zealand to recognise that contribution and say: “Actually, we’re going to support these people—our Cook Island, Tokelauan, and Niuean people—to return to their own country and make an investment there.”

I do want to say that we support this bill, and we support the purpose of this bill, but I want to outline our support for the Supplementary Order Paper that is being put forward by New Zealand First, which changes the eligibility from what the National Government has outlined in the bill that we have before us tonight. I do want to make one other point, and that is that we do support the Supplementary Order Paper that has been put up by New Zealand First, but I do want to acknowledge my colleague Poto Williams, who actually signalled very early in the minority report that was put forward to the Social Services Committee that she was going to be putting this Supplementary Order Paper up, but then one of our friends from New Zealand First—no grudges—decided that was such a good idea that they would put the Supplementary Order Paper forward themselves.

So we support this bill. As I have outlined, though, we do support the Supplementary Order Paper that is being put up by New Zealand First later on tonight to change the eligibility slightly, so that of the 10 years served, the 5 years of residing and being present in New Zealand do not need to be between the ages of 50 and 65. Thank you.

Rt Hon WINSTON PETERS (Leader—NZ First): We do not want people rewriting history tonight. The reality is the “section 70s” and those people who are caught by this legislation were first promised to have it fixed up by New Zealand First, and no other political party. Those are facts. Go and look at the manifestos and you will see who it was—the political party New Zealand First—who realised that these anomalies are there for the “section 70s” and for the people of Tokelau, the Cook Islands, and Niue, and who set out to redress them.

If you look here, you will see that some people in the Government still do not get it, despite the fact that my colleague Andrew Bayly has been in the Cook Islands assuring all those people that he will give it his best intentions. He has given those Cook Islands people all sorts of assurances that when he gets back he is going to fix it up.

Sue Moroney: Really?

Rt Hon WINSTON PETERS: That is what Mr Bayly did, yes. He went to the Cook Islands New Zealand retirement people over there and gave them that assurance, and my colleague the very esteemed Alfred Ngaro said as his excuse: “I wasn’t there.” Oh, really? So who cast his vote without his authority? I know my friend Alfred Ngaro is an honourable man, and I hope that Mr Bayly, from up Hunua way, is also an honourable man, and tonight they are going to say they will support the New Zealand First Supplementary Order Paper, because that is what they told the people in the Cook Islands down at the Swordfish Club. I have got the evidence. I do not blame them, because 5 years ago Murray McCully promised exactly that as well.

But, you see, you have got a Minister in the chair, Anne Tolley, who, on the question of the purpose, does not get it. If you look at the purpose clause, clause 3, and read it very carefully, and then you go to the Minister in the chair’s speech, she repeats this line on the question of the purpose: “We must also bear in mind that without the 5 years’ residence over 50 rule there would be nothing preventing a person born in New Zealand who then lived overseas for most of their life returning to New Zealand at 65 years and claiming New Zealand superannuation.” I heard that and I thought: “That sounds rather familiar.” Well, of course, it is on page 6 of the Ministry of Social Development’s February report. Page 6, there it is—the exact same words parroted from paragraph 5. She parrots the identical same words, and they are false, and that is my point.

My plea to the National Party is surely there is someone over there with some honour who could possibly do something to support those people it promised so much to before. When Mr Doocey was last on his feet on this matter, this is what he said: “What I must say”—this is on the purpose—

Matt Doocey: I’m glad you’re listening.

Rt Hon WINSTON PETERS: I know it is laughable, but you should not laugh yet. [Interruption] Oh, we know it is laughable. This is what he said: “I must just challenge the minority view of New Zealand First. Really, it has no shame, to say ‘Compare this to the generosity of giving full New Zealand Superannuation entitlement to non-New Zealand citizens from non-reciprocal pension countries after just 10 years’ residency.’ I would challenge New Zealand First to stand up and show us the data for that. Normally, individuals have to spend 10 years here to get 50 percent and 20 years to get 100 percent. This is just typical migrant bashing by New Zealand First—absolutely appalling, and especially so with a bill like this.”

You know, they say in England that the malady of the ignorant is to be ignorant without knowing it, but I have got chart after chart here that will tell the Government precisely how many people in the last 15 years have done just that. The number is 73,985. [Interruption] And it is not a laughing matter, Mr Doocey, because your colleague Mr Bayly was down at the Cook Islands Swordfish Club promising these New Zealanders, who worked hard for this country and who are critical for the Cook Islands community and its infrastructure, that he would do something about it. What we do not like in New Zealand First is people who go overseas who are very fast on the lip and slow on the hip. He gets back home here, and he is not going to do a thing about it. Look, go to the library. All this information is here, Mr Doocey. So, next time, do some homework rather than coming down here and showing us all what you do not know.

Seventy-three thousand is a cost structure factor that the Ministry of Social Development keeps on telling a wayward Minister is a concern. I am talking about fewer than 100 people getting a fair go—I am talking about these people getting a fair go. One of these days I am going to tell you what is going to happen. New Zealand First is committed to fixing this, at the very first opportunity, and it is going to be very soon. If they do not see it our way tonight, I want to tell all those people in the Cook Islands listening as we speak, and I know they are—not all in the Cook Islands; they will be in Niue and they will be in Tokelau listening. I am going to tell them tonight that we will fix it up at the first chance we get. In fact, it will be a bottom line. We know it is not a great number of people—maybe only 79.

We will give Mr Ngaro, this very esteemed representative from Auckland—a Cook Islander himself, no doubt—a chance to cross the House and show some courage. I know it is not easy. I know it is not easy, but come over for the fellowship. It is important, because this is a very God-fearing country and they do not like people who say one thing in the church and something else outside—or do one thing in the Swordfish Club, meeting all the members. Then he gets back home, and what is Mr Bayly doing tonight? Mr Bayly? Are you, Mr Bayly, going to support the Supplementary Order Paper from New Zealand First? [Interruption] Oh, that is sad. This is so sad. This is so sad, because what the National Party is concerned about, of course, is always numbers. If these numbers were big, like all of the beneficiaries falling through the cracks, they would read the stuff from Crosby/Textor and do something. But it is a small number, and so they think they can ignore them.

Well, let me tell the National Party this: there are backbenchers who are going to go down in the next campaign because of that behaviour—oh, big time. I have seen the latest polls. [Interruption] Oh yes I have. Do you know what they do say? Do you know what they say? There is one party that the people in this country trust more than any other party. It is the second-highest choice of all the people across the great divide—the second choice, which means we are the least hated of them all.

Make no bones about it. This is a very important bill. So, Mr Doocey, perhaps you could demonstrate that you have learnt something tonight and cross the House when it comes to the amendment, to ensure that New Zealanders who went across there to work as shipping people, to work for various official groups over there—as we once used to provide them with 4 years’ assistance as teachers—to do rural or island support over there, which means critical things will be done for the infrastructure, are not punished by people being too weak to honour what Mr McCully promised them 5 years ago in the Cook Islands, as my friend Alfred Ngaro knows; he promised them.

Before I sit down, I want to say that nobody is beyond redemption, and I want to give Mr Ngaro a chance tonight, knowing that all those Cook Islands people are listening—oh yes they are. He has got a chance now to stand up for them, to be able to say: “I was a person who ran for the National Party under the label of being a Cook Islander so that I would bring some ethnic diversity to the party. But, more important, I am going to make sure that they hear my people’s word.” Now tonight, Mr Ngaro, is a date with destiny. It is time to cross the House—and bring Mr Bayly, who was being so fast and loose at the Cook Islands Swordfish Club, with you. Then we will know that this Committee stage debate is not a waste of time.

POTO WILLIAMS (Labour—Christchurch East): Kia orana, Mr Chairperson. As the first Cook Islander to take a call on this bill, I just want to make a little comment that this bill is intended to support those people who want to return to the Cook Islands, Niue, and Tokelau. Even the esteemed member who just spoke before me, Winston Peters—he, too, can take advantage of this bill, return to the Cook Islands, and collect his pension. He, too, can be basking in the sun at the Swordfish Club, because this bill is about supporting people to return home for their retirement. But if this Government had taken note of the submitters, the bill could have allowed younger people to return home and contribute to the economy of the Cook Islands.

The purpose of this bill is to allow people who are eligible for New Zealand superannuation to collect it in the countries of the Realm—namely, the Cook Islands, Niue, and Tokelau. That does not mean just people who have a close affinity or have a blood connection to those islands of the Realm; that actually means each and every one of us as New Zealanders have that opportunity to do that. So the previous speaker is quite right in his assertions. This is an important bill for all people, and, in fact, when we were first debating this in the first reading, I know I made the comment that this would be something that I would consider doing myself. Given the opportunity, it is something that I would really like to do.

My colleague Carmel Sepuloni talked about what happened when we were given, as countries of the Realm, free association with New Zealand. What it means is that we have New Zealand citizenship. As people who are of the Cook Islands, Niue, and Tokelau descent, we travel on New Zealand passports. We are New Zealand citizens. What that meant, particularly when the first planes started to go to the Cooks in the 1960s, was that we could travel quite freely as Cook Islanders. And we did; we travelled freely. It meant that our home islands became quite “depopularised”, if that is a word. So now we are in a situation—

Jono Naylor: “Depopulated” is the word.

POTO WILLIAMS: —thank you—back in the home islands, where we have got low numbers of people to support the economy as taxpayers. This bill, when it was first promoted, was asking for people to return home to the Cooks, to Niue, and to Tokelau, not necessarily as older people in their retirement but as people who had built up some expertise and experience in this country, and, possibly, some backing in terms of their financial status—to take that back home to the Cooks, to Niue, to Tokelau, to set up businesses, to take their expertise back there, and to develop the economies back in the Realm Islands.

I remember that my own father used to take advantage of going back to the Cooks in the wintertime, to escape the winter here. Sometimes he would go without my mother, much to my mother’s distress, but he would do so for 3 or 4 months at a time. He would come back to New Zealand because there was the requirement that you could not be out of the country for more than 6 months. You needed to continue to reapply for New Zealand superannuation. What this bill does is it changes that eligibility requirement.

Initially, you need to work in New Zealand for 10 years—that is the first part of the qualification—in order to gain 50 percent of the New Zealand superannuation. Then, in order to have 100 percent of superannuation, you should work for 20 years. But then there is another requirement: post the age of 50 you should be resident and present in New Zealand for 5 years. What that means is that you may have already returned to the Cooks, you may have set up a business—and there are lots of young and not-so-young entrepreneurial people in the Cooks, particularly, who are working in the tourist industry, and who operate businesses like the Swordfish Club, or diving operations, or hotels and motels. If they want to collect their New Zealand superannuation, which they are entitled to do as New Zealand citizens, and, having met the earlier eligibility requirement, they then have to return back to New Zealand for 5 years. That makes no sense whatsoever. They have to leave their businesses, they have to leave their jobs, and their families, and return to New Zealand for a period of 5 years.

Some of the submitters told us that they were leaving jobs behind, coming back to New Zealand, and going on the dole. That makes no sense at all. The submitters were very, very clear about this particular point. It would make a huge difference to them if that criterion was not required, if they did not have to do those 5 years post the age of 50. It would make a huge amount of difference.

It is such a significant clause in the bill that we had an extraordinary thing happen. We had two heads of State come and present to the select committee. Both the Prime Minister of the Cook Islands and the Premier of Niue, as well as Ministers of their Cabinets, came and presented to the select committee to say: “If there is one thing we would change about this bill, it would be to remove that requirement of being resident and present in New Zealand for 5 years after the age of 50.” It would make a significant difference, and this is the issue addressed by New Zealand First in the Supplementary Order Paper it has put up. It would make a huge difference. It was such a significant clause that members of the select committee asked the officials to go away and ask how much that would cost. What would the cost be to New Zealand if we were to take that eligibility requirement out? The answer to that is between $9 million and $21 million. In terms of a flag referendum, that is peanuts. And it is significant because a small amount, between $9 million and $21 million, would make a huge difference to those three Realm Islands—a huge difference.

Louisa Wall: What is the benefit?

POTO WILLIAMS: Well, the cost benefit to New Zealand is that people would move to the Cooks, to Niue, and to Tokelau earlier and they would no longer be a burden on the health system. In terms of New Zealand aid into those Realm Islands, they would be developing businesses and supporting the economy back in those Realm Islands, and they would no longer be a burden on the New Zealand taxpayer. So for a small amount of money, it would have made a significant difference to those Realm Islands.

The other thing that I want to say about this, and I have a lot to say on this topic, is that what this bill points to as well—the unintended consequence of this bill—is about the quality of citizenship. The people from the Cooks, Niue, and Tokelau are New Zealand citizens, but by having this eligibility requirement it means that these citizens are treated differently from other New Zealand citizens. I was at the Christchurch citizenship ceremony last night and we played a video from the Governor-General, who said that when you become a citizen of New Zealand, you are entitled to all the rights and responsibilities of New Zealand citizens. That includes eligibility for your New Zealand superannuation. Did you know that if you are resident in the Cook Islands for 5 years, that counts towards your citizenship application to New Zealand? So this bill actually says that being resident in the Cook Islands, Niue, or Tokelau means nothing in terms of your New Zealand citizenship.

So if there is one question I would like to ask the Minister in the chair, it is why do we have this eligibility requirement? I would like the Minister to explain why she believes that this eligibility requirement is required, because it clearly makes a huge difference to the people of the Realm Islands and it does set up a different class of citizenship. It is evident that if that was not the case, the benefit to New Zealand would be greater and, in fact, it would make it much fairer. It would actually align the other citizenship requirements for this country.

I want to be really clear about what the submitters said. There were, I think, somewhere in the region of 13 or 14 submitters. Every single one of the submitters bar one, who spoke about the war pensions—

Hon ANNE TOLLEY (Minister for Social Development): I am very happy to rise to my feet and answer the question that that member, Poto Williams, has asked. In fact, this bill is bringing into line the people in those countries with every other New Zealander. That is the whole point. The member talked about the quality of citizenship. That is the purpose of this bill because, currently, those people in those three countries have to be resident here to apply. We are removing that requirement and we are bringing them into line with every other New Zealander, and that is the whole point.

The difficulty of acceding to the wishes of the Supplementary Order Paper would be that we would be putting in place a set of circumstances for this group of people that was different from every other New Zealander. So, at the moment, if you are born in New Zealand and you go away, you have to come back, and in order to make sure that there is some sort of connection to New Zealand you have to have that requirement of having lived here for 5 years from the age of 50.

The purpose of this bill that we are talking to tonight is to bring those people in those three countries of the Cook Islands, Niue, and Tokelau into line with every other New Zealander with regard to the 5-year requirement. I would suggest that there are members over there who do not understand that that is what we are trying to do.

DARROCH BALL (NZ First): It is my pleasure to rise on behalf of New Zealand First—

Carmel Sepuloni: Correct the Minister, Darroch.

DARROCH BALL: —to talk on—

Carmel Sepuloni: Correct the Minister.

DARROCH BALL: —yes, yes, I will get there—the Social Assistance (Portability to Cook Islands, Niue, and Tokelau) Bill. Speaking specifically on the bill’s purpose, unfortunately I think the Minister the Hon Anne Tolley is mistaken. That comes out in the purpose, it has come out through the select committee, and it has come out definitely through the departmental report.

The Minister always talks about the inequalities and about making things equal and equitable between New Zealanders, but the point that New Zealand First is making—and I know that the other Opposition parties are making it also—is that, yes, there is a difference with those three countries. That is the point. If the Minister is trying to compare the New Zealanders who are citizens of New Zealand, holding New Zealand passports, living in the Realm of New Zealand in those three islands with New Zealanders living in England or Australia or elsewhere, then, yes, it is different and we understand it is different and we are saying that it is different. That is why we need to change the legislation that the Minister is trying to push through.

If I can put it into some context, if you look at the explanatory note where it says “The changes take into account New Zealand’s close constitutional ties with the Cook Islands, Niue, and Tokelau and are part of New Zealand’s commitment to support their ongoing economic and social viability.”, then that blows it out of the water if you put the stipulation that they are different, or if you are trying to say they are the same as all the other New Zealanders around the world. You have just isolated those three countries specifically, as part of the purpose, and now you are backtracking and saying: “Well, we are making it because it is the same for every New Zealander who is living overseas.” That does not make sense.

Jono Naylor: You don’t make sense.

DARROCH BALL: Sorry? And that is why New Zealand First has put in Supplementary Order Paper 71. That is why the Opposition parties are going to support the Supplementary Order Paper, because it is common sense. That is what the problem is with this amendment bill, and that is why the National Government knows—even through the select committee process, Alfred Ngaro was nodding along. The majority of the submissions that came through to the committee were all on the 5 years over 50 rule. The reason why is that it is the most important part, which affects the viability of this entire piece of legislation and the viability and the credibility of this Government and of the Minister when she stipulates what the very purpose of this bill is. It undermines the entire process.

What we are looking at is a very unique situation, where one of the submitters was actually the Prime Minister of the Cook Islands himself. I think that highlights the importance of the issue. What he brought up was the 5 years over 50 rule. The Government and the Minister cannot continue to ignore that point that we are trying to make. We are trying to push through, with this Supplementary Order Paper 71, the changes that we need to have the support of the National Government on. I know that Jono Naylor agrees with me—

Jono Naylor: Yeah, that’s right!

DARROCH BALL: —yes—with regard to the 5 years over 50 rule. So what is happening with the situation now? At the moment we have—and it is part of the New Zealand First minority view that we put through—New Zealanders living in the Cooks who are born and bred Kiwis. So, for example, one worked in New Zealand for 29 years, with 26 of them after the age of 20. He does not qualify for New Zealand superannuation because he returned to the Cook Islands when he was 46 years of age. So if you compare this with the generosity of giving full New Zealand superannuation entitlement to over 65,000 non - New Zealand citizens from non-reciprocal pension countries after just 10 years of residency, where is the fairness? Where is the equitability that the Minister was talking about in the purpose of this bill?

Those who enter under the parent category have no requirement to contribute to this economy, but we have got people who have worked here for 25-plus years who have paid their taxes and have decided to move to one of these three Realm Islands, who are holders of our passports and are citizens of this country, and who do not meet the requirements, according to this legislation, for New Zealand superannuation payments. That is outrageous, and that is why we have put forward the Supplementary Order Paper.

ALFRED NGARO (National): I rise to take a call on this bill. First of all, I just want to be really clear: I absolutely support this bill as it stands and as recommended by the Social Services Committee to return to the House. Secondly, I do not support—and the Government does not support—Supplementary Order Paper 71, which the Rt Hon Winston Peters has lodged. He has talked a lot about the Swordfish Club or Swordfighters Club—I am not sure which one it is. I have not been to that club—sorry, I have been, but I have not frequented it as much. I think Trader Jacks is where the Rt Hon Winston Peters has actually been. He knows Trader Jacks very well. There have been very many great conversations with expats who live over there, and I imagine that they have talked about this. I think this is a great opportunity, because I know the Rt Hon Winston Peters probably has more stamps from the Cook Islands—from Rarotonga and even Aitutaki—on his passport, even as the Minister of Foreign Affairs, because such is the relationship that he has. Irrespective of the wine box and all the other things that have gone on previously, he has a special relationship with the Cook Islands, so this is a great opportunity to be able to ensure that he can reinforce that relationship.

Let us get to the crux of the bill, in the first part. There are a couple of points that have been made. Let us talk about these 5 years, because those have been the contention. There were 13 submissions, 12 of which talked about the issue of the 5 years and were looking for an exemption from those 5 years. Here are the reasons why. Some members may not have read the regulatory impact statement or the disclosure statement, but they are very clear. First of all, there are social security agreements with other countries, such as Canada and the UK, and in these agreements, there is a reciprocal arrangement. Under that reciprocal arrangement, what it means is that if there is a New Zealander who decides that he or she wants to retire back to one of these countries, they still have to do their 5 years in order to receive that pension. The reciprocal arrangement is that New Zealand will pay for their pension—their superannuation—back in the Cook Islands. So the question is this: who pays for the superannuation of Cook Islanders or Kiwis from here if they decide to return to the Cook Islands, Tokelau, or Niue? Who is it? It is New Zealand that pays for it. If, in return, people in the Cook Islands decide that they want to return to New Zealand and live here, could the Cook Island, Niuean, or Tokelauan Governments pay their superannuation? The answer is no, they could not. That is what you call a reciprocal arrangement—a social security agreement—that could not be met. It is very simple. It is very clear.

The second thing is that there was a point that was made by Poto Williams with regard to citizenship. Let us also remember this: the Cook Islands, Niue, and Tokelau are three nations of the realm. When we are talking about “the triple star” in our national anthem, what we are talking about is this: they are self-governing and have free association. So, yes, they have the rights of citizenship but they are self-governing. In other words, there is a difference. You cannot say that they are one and the same. If you do not know that, then you may need to research a little bit about self-governance—OK? You may need to research a little bit about self-governance, so that you get the point. That is why it becomes very important. There is no discrimination. There is no Outrageous Fortune by Mr Darroch Ball about this bill. This is a good bill.

The last point that I want to make is this: Minister McCully talked about the fact that he was making a commitment to those three nations and that he would put this through. Let us remember: no other nations have this special dispensation—not Samoa, not Tuvalu, not Kiribati, and not Tonga. There are only three nations that have this special dispensation: these three nations. So when you say that there is discrimination, there is no discrimination. In 2011 when the earthquake happened in Christchurch, Minister McCully said this: his commitment was that this legislation would go through; however, because of the cause of the issues in Christchurch, we had to meet our obligations there, first and foremost. However, the question you ask, and those who are listening ask, is this: has he kept his promise? The answer is yes, he has, because here we have a bill, and I would like to challenge the member over there. When it comes to voting for this bill, you may not get your Supplementary Order Paper, but I will ask you this question: will you vote for the bill? You have put your minority report in, you have made your assertions, you have talked about discrimination, but the question is: when it comes to the bill, will you vote for it? That is really where the answer will lie, because this bill is a good bill. This bill is a bill that no other Pacific nation has the opportunity for. You do not have to be present and resident in this country. At the age of 55 you can return back to your nation, you can serve your country for another 10 years, and you can apply from there.

So I have got to tell you this about the report that was committed in 2011 by the Foreign Affairs, Defence and Trade Committee—and Mr Winston Peters will know this. I will call him the honourable John Hayes. The honourable John Hayes had this report, and the report said this: our commitment and our responsibility back to those Pacific nations relate to the issue of depopulation. In some cases—in the Cook Islands, for instance—up to 500 people were leaving the Cook Islands per annum, so this was a way of keeping up that commitment. In honour of that report and the research that was done, this was the commitment. I commend this bill. I am happy to go with the Rt Hon Winston Peters to the Swordfish or Swordfighters Bar, or whatever you want to call it, or to Trader Jacks to sit down with the expats and give them the facts—not the semi-facts, not the sort of shady facts in a box called a wine box; no, no, no. We will put it straight to them. I will be happy to stand there and be able to present them with the facts and the reasons why. I think that once they hear those, they will see that this bill is common sense. I commend this bill to the House.

SUE MORONEY (Labour): Well, we heard in an earlier speech in this House that they call them the Brown-Blues, or the Blue-Browns, and now I think we know why. Now I think we know why, after that very disappointing speech from that MP, Alfred Ngaro, who came into this House because he was going to speak for his people, the Cook Islands people. Here we see him instead this evening, when he has got the very best opportunity—the very best opportunity—to do the right thing by the Cook Islands people, he is going to vote against a Supplementary Order Paper that is actually going to remove the situation whereby Cook Islands New Zealanders have a different standard for their right to have superannuation than other New Zealand citizens—

Hon Anne Tolley: It is not.

SUE MORONEY: —and there is no other way to hide that, Minister. What other New Zealand citizen is going to have to prove that they have been here for 5 years between the ages of 50 and 65 in order to get their superannuation? Who else is going to have to do that? I am not going to have to do that, so what the Minister said before is clearly wrong and, unfortunately, she seems to have pulled the wool over the eyes of some of her colleagues. It is disappointing to hear that Alfred Ngaro and, apparently, Andrew Bayly have been in front of Cook Islands communities pledging that they would fix up this part in the Social Assistance (Portability to Cook Islands, Niue, and Tokelau) Bill, and then when it comes to the voting action, clearly they are not going to honour that, and I think that is deeply disappointing.

Hon Member: Get some guts.

SUE MORONEY: Yes, it is shameful, because one of the things that this Government has become known for is to say one thing outside the debating chamber and do another thing when it gets inside in the debating chamber, and that is not going to enhance the reputation of that Government, or of the New Zealand Parliament, actually, if it continues to do that.

When I spoke on the first reading of this bill, I paid homage to two very fine Cook Islands leaders in our community who had not long passed when we were debating the first reading of this bill: Terry Chapman and George Ford. I want to just pay homage to them again in the Committee stage and Part 1, when we are debating the purpose of this bill. I am sad to say that they did not live to see the day when they could have taken advantage of this bill. I am sure it would be something that they would have considered doing, because they both felt very strongly about not only the Cook Islands community and supporting it in Hamilton but also about making sure that they kept very strong connections with the Cook Islands as well. I feel very honoured that, in fact, that speech that I gave on the first reading was shown up and down many Cook Islands churches right throughout the country, and I feel very honoured that that was the case. But I hope also that the Cook Islands community will show the speech from Alfred Ngaro that he just finished in their churches as well, because I think that speech deserves an airing in front of the Cook Islands communities. It is no good, Mr Ngaro, saying one thing outside the debating chamber and saying quite a different thing when we come inside the debating chamber.

Alfred Ngaro: Really, Sue?

SUE MORONEY: Yes, really, Mr Ngaro. Are you ashamed that that speech would be shown in the Cook Island churches?

Alfred Ngaro: What have you ever done for the Cook Islands community?

SUE MORONEY: No, he is happy for it to be shown, so I think it should be and I will be—

Alfred Ngaro: Oh really? Is that the greatest thing you could ever do?

SUE MORONEY: I will be supporting Supplementary Order Paper 71, Mr Ngaro, ahead of you. So let us just see. If you feel proud of the speech, please make sure that it gets played in the church services in the Cook Island churches—

The CHAIRPERSON (Hon Chester Borrows): Come back to the bill.

SUE MORONEY: —up and down the country this Sunday. I think it would be very fine if you did that.

This bill is a step forward, but it could be so much better if the Supplementary Order Paper put forward by New Zealand First—I think it is in the name of Winston Peters—was to be supported across the Committee, because we actually do have unity across the Committee on every other part of this bill. The purpose of it is a fine purpose. I find it interesting that when we are debating the bill, we almost debate it as if we assume that it is going to be people of only Cook Island, Niuean, and Tokelauan descent who are going to use this bill, but, in fact, the way I read the bill any of us could use it in this way. We could be resident in the Cook Islands—would that not be lovely—in our later years and use our New Zealand superannuation, which I imagine would support quite a pleasant lifestyle in the Cook Islands or in Niue or in Tokelau. Certainly, I think that is an opportunity.

TRACEY MARTIN (Deputy Leader—NZ First): Kia ora, Mr Chair. I am taking just a quick call on behalf of New Zealand First on the Social Assistance (Portability to Cook Islands, Niue, and Tokelau) Bill. It has been an interesting debate so far, and there seems to be some confusion. Let us just talk about the confusion from the Government benches’ side. On one hand the Government benches are trying to say that the relationship with these three islands is special, it is different, it is recognised as such, they are members of the Realm, they are islands of the Realm, and then on the other hand the Minister has stood up and said that they are to be no different. So on the one hand they are special and on the other hand they are to be no different.

If I was to pick up on the Minister’s comments about their being no different from any other New Zealanders, and speak on the purpose, the purpose that has been described inside the bill—what if we just actually used a bit of forethought and expanded on the purpose? What would happen if the Government did support Supplementary Order Paper 71, which the Rt Hon Winston Peters has placed on the Table to remove the 5-year restriction? What would happen to that purpose, which is about allowing the Cook Island, Niuean, and Tokelauan New Zealanders to be at home on their islands? I cannot imagine that Mr Alfred Ngaro does not understand the concept and the reasoning as to why these people want to go home in their final years, why they want to go back and put money into their communities, to spend their pensions on those islands, creating a whole other level of industry on those islands, for example. There would need to be aged care. There would need to be some expansion of the hospital services. They could take their skills back in those last years and add to the increase in those services. New Zealand currently provides aid into the Pacific. Is this not another way? Instead of providing money in one way, between $9 million and $21 million, it could be provided directly through what are eligible New Zealanders with their pensions.

The Prime Minister of the Cook Islands himself came to express at the Social Services Committee what he understood was promised to him and his people by that Government. He came to express it. I have no doubt whatsoever that the Prime Minister of the Cook Islands is a highly intelligent man. I do not believe he misunderstood conversations had with him by members of the Government. He understood, as 12 out of the 13 submitters understood, that there would not be this restriction.

Should these islands be treated differently? We believe that they should. We believe that they are special. We do believe that there is a special relationship here. Does that then open the floodgates for Canada, as Mr Ngaro said, or any other nation? No, it does not. We would suggest that this Government adhere to its word, the word behind closed doors, the word in the Swordfish Club, the word taken by others to the Cook Islands community. The Government knows what the Cook Islands community, the Tokelauan community, and the Niuean community were seeking from it with this legislation. Half-pie is not ka pai. This is not good enough. This is another half measure by this Government that short-changes these New Zealanders.

Again, there is a Supplementary Order Paper sitting on the Table under the name of the Rt Hon Winston Peters, one of the few members inside this House who advocates for and truly understands these islands and the purpose they are seeking from legislation here. He is an advocate for them and has been so for years. New Zealand First will be supporting the Supplementary Order Paper. We understand that the rest of the Opposition will be supporting the Supplementary Order Paper. It will be the Government members who fail these people. It will be the Government members who fail these New Zealanders, who fail to see an opportunity to partake and participate in the future of these Pacific Islands through a very small measure for a very small number of New Zealanders who could do so much good if the Supplementary Order Paper were to be supported. Kia ora.

JAMI-LEE ROSS (Junior Whip—National): I move, That the question be now put.

CLAYTON MITCHELL (NZ First): I rise on behalf of New Zealand First to take a call on this bill. I think this is another indication, somewhere else, where the National Government has come out and shown its mean-spiritedness. It is short-sighted and mean-spirited. In actual fact, looking around the Chamber tonight, we are hearing a lot of support for the intent of this bill, but having that eligibility clause in there, Mr Doocey, has some serious implications and some unfairness for New Zealand citizens. Mr Doocey, I have to say you have got a chance to “Doocey” some homework and “Doocey” something about this, instead of just sitting there playing on your phone right now. The reality is that this piece of legislation, if we unite together as a Parliament, can actually make some serious changes for those people who need some help.

New Zealand First knows, like the rest of the parties in this Chamber understand, that the populations in these small minority islands are actually on the decline. To not accept Supplementary Order Paper 71 will actually just enhance that exit migration that is happening in those islands. Who is going to be picking up the pieces in the likes of these small islands of the Realm? It is going to be New Zealand. The fact that it was pointed out that they are in governance of their own shows that they are doing everything they can to minimise the impact on the costs that New Zealand is putting forward in aid of, and support to, those island nations.

We heard Anne Tolley stand up and speak for a very brief moment when she was comparing apples with kiwifruit. The reality is that they have no similarity when we are talking about other parts of the world that we want to compare these islands with that are part of our Realm. What we should be specifically talking about and comparing them with are the other islands that are surrounding New Zealand—the likes of Stewart Island, Matakana Island, Great Barrier Island. Goodness me! Are we going to start disenfranchising those New Zealanders as well? They are adding to New Zealand’s currency, they are adding to New Zealand’s popularity, and doing everything they can to add a wider diversity to this country. To disenfranchise those islanders for the simple reason that they live so far away on an isolated island—we should be seriously looking at that Supplementary Order Paper. [Interruption] You can sit there and laugh all you like, but the reality is that this is very serious for those people who grow up in these Island nations, all right?

If we could just get rid of this mean-spiritedness that this National Government has shown us time and time again—you know, everything it can do to rip a little bit away—then I think we could actually all get along. Like Cadbury’s said, wouldn’t it be nice if the world was made of chocolate? But would it not be nice if you could seriously see the sense in the Supplementary Order Paper that the Rt Hon Winston Peters had put forward to actually make a difference to those Island people living so close but yet so far away from New Zealand? Yes, the intent of the bill is absolutely supported because it does make sense, but you are missing a key point. You are putting a condition on it that should not be put there for those disenfranchised people who do not specifically live under the roof and umbrella of New Zealand. Thank you, Mr Chair. That is all I have to say at this stage.

JAMI-LEE ROSS (Junior Whip—National): I move, That the question be now put.

POTO WILLIAMS (Labour—Christchurch East): I just want to respond to the member Alfred Ngaro, the only other Cook Islands member in the House, because as he took his seat after his last call, he pointed to the badge on his chest. In my first reading speech I told the House about the sacrifice that the Cook Islanders had made for this country in World War I. A hundred years ago 500 Cook Islands soldiers marched under the banner of New Zealand for this country. Their sacrifice is what Mr Ngaro referred to when he pointed to that badge on his chest. I have to say that it causes my heart deep mamae to see that in this House, without him then making the absolute commitment to the people of the Cook Islands and crossing the floor to support the Supplementary Order Paper that will actually fix that clause that causes inequality for the people of the Cooks, Niue, and Tokelau in terms of their citizenship under the New Zealand flag. That one change would make a huge difference.

We are unequal as citizens. We are. There are two parts of this bill that demonstrate that inequality and inequity. If you are a person from the Cooks, Niue, or Tokelau there is that 5-year requirement after the age of 50. But there is also the requirement to actually undertake 20 years of work service or residency in this country to qualify for 100 percent of the superannuation. As a New Zealander who just lives here you need to be here for only 10 years, but as a Cook Islander, a Niuean, or a Tokelauan you need to be here for 20 years. There are two parts of this bill that show that this Government does not care for the people of the Cooks, Niue, and Tokelau. If Mr Ngaro wants to point to that badge and talk about the sacrifice that our people gave to this country, then I have to say I am ashamed to see that in this House tonight, Mr Ngaro. I am angry, because our people died for this country. Yet you will not support a Supplementary Order Paper that will change this bill to make it equal for all New Zealanders—all citizens with a New Zealand passport, Mr Ngaro. That is all I have to say.

JAMI-LEE ROSS (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 109

New Zealand National 59; New Zealand Labour 32; Green Party 14; Māori Party 2; ACT New Zealand 1; United Future 1.

Noes 12

New Zealand First 12.

Motion agreed to.

Part 1 agreed to.

Part 2 Amendments to enactments

Rt Hon WINSTON PETERS (Leader—NZ First): On the National Party side there are those people who have campaigned over the years for nomination as a candidate and who have put up their Māori background, and one even has a Cook Islands background, as one of the reasons they should be chosen to give the party, narrow as it is, a greater diverse dimension. They did so on the promise to those people who backed them that when they got here they would actually do something—put up their hands for them on those occasions when they should show, because of their unique background as they claimed it, their special understanding of their needs. This is such a moment.

Jono Naylor: Last time I checked it was a Government bill.

Rt Hon WINSTON PETERS: As for that member from Palmerston North, I say to him that if you cannot win Palmerston North when you have got a swing going with you, then I think it is time to not say much when you get to Parliament. I think it is not a time to get to Parliament and show off one’s ignorance. I am talking about those Māori members, and their names are Reti, Paula Bennett, Jami-Lee Ross—whose greatest contribution to this debate is to get up and seek to terminate it—Jo Hayes, Mr Korako, Hekia Parata—

Jono Naylor: Where’s this in Part 2?

Rt Hon WINSTON PETERS: This is Part 2, where you get to the change to that critical clause that says that it is not just for those people who live in Tokelau, Niue, or in the Cook Islands—not as to 10 years but 20 years, which straightaway is prejudicial—but if you happen to be a European critical to the infrastructure, like heading the Companies Office, or like heading the Crown Law Office there, or like working for those critical Government departments like education, helping the local infrastructure, in that case you are to be forgotten. That is where it is in Part 2 of the bill, I say for the sake of the list MP for Palmerston North. Read the darn thing! I know that the Minister for Social Development has not read it, because the Minister got up and again parroted in her explanation how little she understood about this subject. She tried to make out that if you came from the Ukraine or Poland, you were the same as a New Zealander working in Tokelau, the Cook Islands, or Niue. This is so base and sad, but we know that one day soon it will change, because there will be support for New Zealand First’s amendment to the original bill and to this matter.

On the question of affordability, I say to the Government: do not allow 73,000 to come to this country and be here for just 10 years, have no requirement to pay tax, and then tell me that you cannot afford my amendment. Or is it that nowadays we favour some other country and not our own? We want the capital “S” put back into the special relationship between us and these three Realm countries. It is that simple. Do not tell us you cannot afford it, because 73,000 have done just that.

Of course, Government members remind me sometimes of that famous line in The Mikado—the idiot who praises with enthusiastic tone all countries but his and all nations but his own. That is about what you hear from them, day in and day out. They cannot explain themselves. They cannot explain why they are doing it, and they are following a Minister who cannot read the legislation herself. They are praising all centuries but this one and every country but their own. When it comes to their citizens, they have left them high and dry tonight.

I come back to Mr Ngaro because he is the one unique person there whose powers of—how shall I put it—evangelical persuasion should have convinced his caucus members a long time ago of the unfairness of what they were doing. It should appeal to a man of the cloth to reach down for the ordinary people, not the barons but the important people for whom the National Party is so famous—like the legislation earlier tonight where it backed Shell Todd Oil Services. I am not against the Todd family—the Government backed the Shell organisation, a big, huge multinational; it said “Jump”, and the Government said: “How high?”—but some ordinary New Zealand people who work in that part of the world just want a fair go so that they can stay there and not come back here for 5 years, dislocate their ownership, their businesses, their assets, and what they critically can do for the Cook Islands, some of which the Cook Islands cannot afford to lose, nor can Niue or Tokelau, and they will not move.

Let me say to those members, as Douglas MacArthur once said to the president of the Philippines: “There will come a time soon when your boss will want to talk to us and we’ll want to talk to him.” Make no bones about that, and we are going to remember those days. We will remember them very, very clearly and with great purpose, because it comes down to this question: can you be trusted with the needs, desires, hopes, and aspirations of ordinary people? And all we are hearing tonight is no. We have heard every reason except the right reason. If the reason is cost, then pray tell me how 79 or 100 people could be anything like the 73,000 thus far defended by them—73,000 as against maybe 100? Or is it because these Island nations are not unique? Is the small “s” to come back into the relationship?

When this measure was promised by New Zealand First and taken up by this Government over there, it was to the New Zealand people who have spent parts of their lives serving those nations in the critical arrangement that we have with those three Realm countries. Is that too much to ask for? I am asking Reti, Bennett, Jami-Lee Ross, Jo Hayes, Korako, Parata—oh, and Simon Bridges. There is someone who discovered his iwi after he got into Parliament. What are they going to do? Are they going to say “We understand those people’s needs and we’ve something special to say?”, or are they going to be just thumbed down by the whip and by the Minister, misleading the Committee, as she has done?

Again I say to the Minister that if you go to the purpose of this legislation and then to the change we seek to make, you will see that it does not have the effect that the Ministry of Social Development has laid out. How many times have I seen certain ministries miswrite the facts—Treasury, countless times?

Treasury has been telling the Minister of Finance that this country is the best-performing country in the OECD. The sad thing about that is that he believes it. That reminds me of J P Morgan, who went, of course, to the American President one week before the great collapse of Wall Street and told him his country was performing unbelievably and that it had the greatest economy in the world. A week later the whole thing crashed, worldwide.

I want that Minister to explain to us why it is that those few people, often in such critical jobs—and I have seen them over there, heading up the law departments over there, acting as the Solicitor-General over there, acting as the head of the Companies Office, doing critical things in the health department and in the education department—would be punished by being omitted? We do know that when Mr Andrew Bayly was over there, he promised to take home their message and ensure that they got a fair go. When Mr Ngaro was over there—and it is not a matter of humour about Trader Jacks or the Swordfish Club; that was where those members were holding their meetings and where they gave this promise, unconditional, that when they got back, they would do something about it.

Mr Ngaro, you cannot get away with the excuse that you were not there that night, because these people are intelligent, they are bright, and they know that the proxy was left to vote it down. They know that. This time there is a chance to be, in a personal sense, self-redeeming. Just get up and walk across the Chamber at the critical time. No matter what happens in what looks like it might be a brief career, back home they will always have a job for him. More important, back home, because of our change, there will be superannuation when he gets to 65. This may not be very far away. The fact is that even if I can appeal to his narrow, greedy instinct—he has got to be personally a beneficiary. They say that in politics there is no sin like ingratitude. There is no sin like ingratitude. Mr Ngaro has got a chance to fix up all those promises he made and to ensure that tonight, his party, for the first time for a long time, does the right thing.

The CHAIRPERSON (Lindsay Tisch): Members, we got ahead of ourselves prior to the Rt Hon Winston Peters speaking. The Committee moved and accepted a closure motion, and the question was not put. I am now putting the question, and the question is, That Part 1 stand part. Those in favour will say Aye, to the contrary, No. The Ayes have it.

Sue Moroney: I raise a point of order, Mr Chairperson. Could you clarify, then, what the vote was that was taken at the time—what did we vote on?

The CHAIRPERSON (Lindsay Tisch): Yes—[Interruption] no, no—we had a closure motion, which the Committee accepted, but the Chair at the time did not put the question that Part 1 stand part. I have just put that question now, it has been accepted, and now we are back on Part 2. [Interruption] I am sorry—the member has just had two consecutive calls on Part 2—

Rt Hon Winston Peters: No, no—this is Part 2 now—

The CHAIRPERSON (Lindsay Tisch): That is right, and you have already had two calls on Part 2. [Interruption] No, I am calling Poto Williams. [Interruption] Sorry, there is a point of order.

Rt Hon Winston Peters: I raise a point of order, Mr Chair. I do not want to be difficult here. I understand the problem, but speaking logically, as a matter of logic, and chronologically, this is the first speech for Part 2 that I am seeking.

The CHAIRPERSON (Lindsay Tisch): No, we have already had two speeches on Part 2. What we had not done was actually vote on Part 1. I am calling Poto Williams.

POTO WILLIAMS (Labour—Christchurch East): I rise to take a call on Part 2. This is actually the most substantial part of the bill. There are a couple of things that I want to raise in this contribution. This part is about the kind of technical operation of the bill. One of the things that this bill does is provide for the mechanism to make the application for the superannuation a little bit easier, so that if you are actually already resident in the Cooks at the age of 65, which is the age at which you can qualify for and apply for the superannuation, you can do so from the Realm of New Zealand islands. You do not have return to New Zealand to make that application and have it accepted. You can also apply for the superannuation before the age of eligibility. It will not get paid to you until you reach the age of eligibility, but you can still have that application in place, ready for when you do turn 65.

The other thing this bill provides for is the checking mechanisms. In one of my earlier contributions I talked about how my father would winter sometimes in the Cooks and would be required to come back to New Zealand, and that was part of the old checking mechanisms for New Zealand superannuation. With this bill you are now able to remain resident in the Cooks, Niue, or Tokelau and the ministry can check with you—usually by writing to you—that your eligibility requirements are still in place, so it makes it a lot easier. It also provides for the application to stay live for a longer period of time, because, let us face it, there are constraints around having documents sent in the mail, etc. So it just clears up some of those difficulties that some applicants may have had in the past.

But also in Part 2 are those contentious eligibility requirements, which we have already traversed quite a bit in the first part of the Committee stage, but they are very relevant. I want to reiterate what I see as the huge inequity in this. To qualify under this bill for 100 percent of New Zealand superannuation, you have to do twice as long a residency in this country as any other New Zealander. Under current superannuation laws you can be resident in New Zealand for 10 years after the age of 20 and qualify for 100 percent of your superannuation. However, if you are going to apply from the islands of the Realm, you have to be resident in New Zealand for 20 years to qualify for 100 percent of your superannuation. That is inequity No. 1, as I have already described.

Inequity No. 2—the whole crux of Supplementary Order Paper 71, and the really difficult part, which is actually the part that the National member from the Cook Islands could carve out as his contribution to our country. This is the nub of the matter, which is that you have to come back to New Zealand after the age of 50 and do 5 years’ residency here in order to qualify to collect your superannuation.

When I was talking to members of the Cook Islands Government about this earlier in the year, they asked: “Why is that the case, when in order to qualify for New Zealand citizenship, you can be resident in the Cooks for 5 years?”. In fact, I met a gentleman who was doing just that. In order to qualify for his New Zealand citizenship, he was resident in the Cook Islands. It makes no sense to me that you could have that requirement for New Zealand citizenship, but you could have a completely different requirement in order to collect New Zealand superannuation when you are already a citizen of this country. The Minister in the chair, Anne Tolley, did not explain well enough to me why that is the case. I do not understand why that is the case. It is blatantly unfair for someone who holds a New Zealand passport as a New Zealand citizen to be treated differently from another person who holds a New Zealand passport and is a New Zealand citizen. That is the crux of the argument on which the members of the Opposition have so much disagreement.

The rest of the bill we completely agree with. The rest of the bill is great, and it actually provides an opportunity to have a discussion in this most important year for the Cook Islands, when we celebrate 50 years of being self-governing in free association with New Zealand. This a great year, an important year, and I suspect the reason that we are actually debating this bill in the House is that it is a gift to the countries of the Realm to have those things passed. However, would it not be wonderful if we could actually do something that made a difference, by removing that requirement for residency of 5 years after the age of 50?

There are a couple of other parts of this bill that have caused the veterans some difficulty. That was the other submitter on the bill—the only one who did not submit on the residency clauses. The submitter who spoke about the veterans pension said very clearly that it was his belief and the belief of returned servicemen that veterans pensions were not superannuation and that they should not be covered under the same bill. They should be treated separately because a veteran attracts the veterans pension because of the service that they have given to our country and because they have put themselves at the ultimate risk in terms of fighting for our country. I have to say that no one has actually picked up that part of the submissions tonight, so I want to honour that submitter who made that submission and say that I understand what you were saying in that submission. That submitter was wanting to differentiate between someone who collects a pension because they are of an age and someone who collects a pension because they have provided service to their country.

I just want to say in conclusion that this is an important piece of legislation for the countries of the Realm. I would again ask the Minister to please explain why, in terms of our citizenship, there is different treatment for people who want to collect their superannuation in the Cook Islands, Niue, and Tokelau. We are citizens of New Zealand and we do hold New Zealand passports. Thank you.

Hon DAVID CUNLIFFE (Labour—New Lynn): I rise to take a short call in support of the bill, along with my colleagues. I acknowledge that we are in the Committee stage on Part 2, but as the Chair will be aware Part 2 contains almost all of the operative provisions of the bill and therefore it is appropriate, I think, that we are able to traverse in reasonable breadth the guiding principles of the bill and the way it will be implemented. The first point that is germane to Labour’s support of this bill is that it pertains to residents and citizens of the Realm of New Zealand. The Cook Islands, Niue, and Tokelau are not entirely separate constitutional entities; they are part of the Realm of New Zealand. So when we go back to first principles, we ask ourselves whether it is appropriate that they should enjoy the rights of other New Zealand citizens to pension entitlements. Then in principle there is a very strong argument that they should.

The second argument that we have considered is the fact that those communities have made a significant contribution to New Zealand and that large parts of their historic populations and high proportions of their current population are ordinarily resident in New Zealand. Therefore, the productive lives of many of their sons and daughters have been spent in New Zealand and have enriched our country. Therefore there is an argument—I think a very powerful argument—that it is appropriate that both those sons and daughters and their parents ought to be able to enjoy the benefits of a funded retirement in the Cook Islands, Niue, and Tokelau.

Thirdly, I think it is germane—and, as a former health Minister and immigration Minister, I am informed by past practice and precedent here—to note that New Zealand’s economic interests are probably well served by this bill. The reason is that we all know that there are significant advantages to ageing in place. We leave aside for a moment the issue of being trans-border; we know that our own senior citizens often prefer to live in their own homes for as long as they can before health issues overtake them and they need to move into a retirement care facility. In the same way, there are distinct advantages to people being able to live in the Islands if that is where they have grown up and they have had their families and their memories. It also means that they probably will be a lower economic cost to the New Zealand health system based in those Island countries. Although there is an upfront cost to making the pension portable, there is a downstream saving to our health system.

Those upfront costs are significant but they are not insurmountable, according to officials’ analysis. We are looking at roughly an extension of around $4.5 million to $5 million per annum by 2016-2017, with administration costs to the new legislation of between $70,000 and $137,000 up to 2016, declining to $66,000 thereafter. In terms of the broad numbers, those are not huge numbers. Given the principles that we have enunciated at the start, which are the contributions of those peoples to New Zealand and our close constitutional relationship with those parts of the Realm, it is certainly our view that those costs are well warranted and indeed offset by savings to the health system.

Let me note in relation to this part another set of interests that are well served. New Zealand is historically located in the South-west Pacific. This is our strategic front yard. Those parts of the Realm of New Zealand, as the world becomes ever more complex, have never been more important for us to hold close, hold dear, and hold intact. That is a contribution to New Zealand’s national security that is not to be underestimated. Therefore, this is one of those happy coincidences of both principle and interest. It is principle because of the considerable contribution that residents of those parts of the Realm of New Zealand have made to the broader New Zealand society and economy. It is a contribution that is well known to those of us from west Auckland, which has a high population of peoples of those communities.

CARMEL SEPULONI (Labour—Kelston): Part 2, as my colleague the Hon David Cunliffe was saying, seeks to make amendments to the enactments that enable us to carry through the purpose of this bill, basically. I do want to just say that it really would not be that difficult to amend the enactments that are relevant to this particular bill, those being the New Zealand Superannuation and Retirement Income Act, the Veterans’ Support Act, and the Social Security Act. It really would not be difficult to extend the amendments to actually include the provisions of Supplementary Order Paper 71, which has been put up by New Zealand First.

I just want to refer to that particular Supplementary Order Paper in relation to the enactments that would need to be amended and make a point of highlighting something that the Minister said earlier. She said: “Why would we exempt these three Realm countries from the 5 years over 50 rule when that does not apply to other countries?”. I just need to clarify with the Minister that actually it does apply to other countries because we have reciprocal pension agreements with countries like Australia, the UK, and the Netherlands.

There are provisions there that may differ from what we are seeking to have here with the three Realm countries, but, as has been pointed out by my colleague Poto Williams and some of our New Zealand First colleagues here in the Chamber tonight, the exemption that we are seeking for citizens of the Realm countries is something that is unique, and actually our constitutional arrangement with those three countries is unique. As has been touched on by my colleague Poto Williams, not only are the citizens from these three countries entitled to free association with New Zealand but a really important point is that they have also fought under the New Zealand flag.

Not only have we a problem here with regard to the depopulation that is happening across the Pacific in these three Realm countries but we actually have had citizens, residents, from these three Realm countries die while serving under the New Zealand flag. So if ever there was just cause for an exemption, I think that is justification for an exemption.

I would like the Minister for Social Development to respond to what I have just said with regard to the countries that do have an exemption from the 5 years over 50 rule—those being Australia, UK, the Netherlands, and I think there are others. I want the Minister to explain to us why it is OK that those countries are exempt but why the three Realm countries that have free association with New Zealand, that have given us their biggest resource, that being their citizens, who have fought under this flag, are not entitled to the same exemption that those countries are provided with.

The CHAIRPERSON (Lindsay Tisch): Members, we move to the vote on Part 2—

Rt Hon Winston Peters: Hang on. Sorry, can I—

The CHAIRPERSON (Lindsay Tisch): The Rt Hon Winston Peters.

Rt Hon WINSTON PETERS (Leader—NZ First): Thank you, Mr Chairperson. I was sitting here patiently. I thought it was high time we got to the relevant Supplementary Order Paper that we have put up in our name. I just want to make a very quick statement on the Supplementary Order Paper 71, the second paragraph of the explanatory note. There are two different categories there. They are plain as daylight, and I refer them to the Minister for Social Development in particular. It says: “Compare this to the generosity of giving full New Zealand superannuation entitlement to non-New Zealand citizens from non-reciprocal pension countries after just 10 years’ residency.” Then it goes on to say: “Many countries enjoy an exemption from section 8(c) because they are countries that have a reciprocal pension agreement with New Zealand, for example Australia, United Kingdom, and Netherlands.” Minister, with respect, nothing that has been said by you or your ministry is actually in any way relevant on this subject. It is that plain.

These people are from three special Realm of New Zealand countries. I am talking about New Zealanders, who are mainly European but some are Māori, who went to serve in various institutions and various official positions and in various ways in business in the Cook Islands, Tokelau, and Niue, and, frankly, their being there is not something of little moment. There is the view that no one is indispensable. Well, I am afraid that in some of these Island populations, being as small as they are, some people are indispensable. If they were not there, then things would not operate because they are so widespread in their talents, able to do all sorts of electrical, carpentry, roofing, and mechanical work. These skills in any small community are very much needed, and the smaller the community is, the more important they are. At the higher levels of government we have sent people over there to act as advisers for their Treasury. We have sent people over to act as advisers for their tax department, for their companies office, for—dare I say it—their shipping service, and their shipping flag register operation. If they are not allowed in, by our Supplementary Order Paper to change the present legislation and replace section 8(c) with what we have got there, then they are plainly going to be missed out and for no sound reason at all.

It cannot be cost, because the National Government members are saying that 73,000-plus acquiring superannuation full entitlement after 10 years whether they have paid tax or not is OK by them. So what could it be based on? That somehow we will allow a flood in from other parts of the world? No, we will not, because the requirements are that you have to be and have been a New Zealander who has worked in New Zealand. So, in short, the Government has been caught out, because I suppose people in the Government have decided to take officialdom’s advice and just dig in and say there is something wrong with the Supplementary Order Paper. Well, frankly, there is nothing wrong with the Supplementary Order Paper. We believe that the numbers are small—we do not know whether there are 79, 89, or maybe slightly higher—but it is such a small number as to be able to say that we can allow that, given how generous we have been, how extraordinarily generous we have been, in respect of these people who are coming in from other countries, in particular China, massively, and India.

When I see someone like Lincoln Tan writing for the New Zealand Herald—and Lincoln Tan is someone who is sympathetic to the Asian cause—saying that ageing China migrants are a major concern and writes article about it, then it ill behoves members over there to jeer at New Zealand First seeking justice for a small number of New Zealand citizens working in these offshore islands whilst doing nothing about this unfairness that they so willingly condone here. All we ask is for those members is to let this Supplementary Order Paper stand tonight. And when you consider how much money is being tossed around like an eight-armed octopus on so many unworthy causes, this one has as its merit that it is right and that it is fair. That is all we ask, because it will be only a few months before the tide of New Zealand politics changes. We do not think this Government will make it to November 2017. We think it is terribly shaky now, and he will be the first guy to go—the one who is two in, whom nobody knows. [Interruption] Boy, have I seen that laugh before, and it never lasts long. I would say to him it would be very wise to pay attention to these sorts of issues because in the end, this is what politics is like. You get in all right, and you have got a truckload of supporters at the back. But every corner you hit hard, you are seeing people being tossed off and, boy, they are being tossed off real fast now. I was up in Northland recently in a by-election. Boy, did they come off the truck fast then—each corner—and most going over a single-lane bridge first. Let me say to that member: be careful here.

Hon David Cunliffe: Those were the days.

Rt Hon WINSTON PETERS: Well, you know what they say, Mr Cunliffe: bragging might not bring you happiness, but no man walks home, having caught a big fish, through the back alley. I want to say to those members over there: pay attention, because one of these days, ignoring this matter will come to visit you big time.

The question was put that the amendment set out on Supplementary Order Paper 71 in the name of the Rt Hon Winston Peters to clause 5 be agreed to.

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

Ayes 58

New Zealand Labour 32; Green Party 14; New Zealand First 12.

Noes 63

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

Amendment not agreed to.

Part 2 agreed to.

Clause 1 agreed to.

Clause 2 agreed to.

Bill to be reported without amendment presently.

Bills

Environmental Reporting Bill

In Committee

Part 1 Preliminary provisions

Dr MEGAN WOODS (Labour—Wigram): I am happy to take a call in the Committee stage of the Environmental Reporting Bill. Specifically, I want to talk to new clause 3, the purpose clause of this bill, because I think that within new clause 3 of this bill—the purpose clause, and what we would expect of this bill, and what we will find through further contributions on this piece of legislation—we will see why it is that Labour is unable to support this legislation. It is not with any great happiness that we come into this Chamber unable to support this legislation. If we look at the broad purpose, at the fact that New Zealand is one of the only countries in the OECD not to have a robust environmental reporting system—if we look at the broad purpose, that we would have an independent check and balance on the state of our environment, these are all worthy aims and something that we could support. But, unfortunately, what we do not see in the detail of the legislation that we have before us is a piece of legislation that fulfils those lofty and worthy goals that we would be happy to support.

The purpose clause of this bill was the subject of a reasonable amount of activity for the submitters on this bill. Eleven submissions were received on this part of the bill in the submissions that were heard at the Local Government and Environment Committee’s deliberations. Most of the submitters did recommend some tidying up of the drafting that was in here. In particular, the Parliamentary Commissioner for the Environment gave a very good submission that proposed a much cleaner clause 3 of this legislation than the one that was in the early draft that went to the select committee. The suggestion of the Parliamentary Commissioner for the Environment was that there be just a very simple purpose statement put in here around what it is that the bill purports to do: “The purpose of this Act is to require regular reports on the state of New Zealand’s environment.” This was supported by a number of agencies. Not only did the Parliamentary Commissioner support this, but so did the Royal Forest and Bird Protection Society, Business New Zealand, the Environmental Defence Society, the Resource Management Law Association, and Fish and Game New Zealand. Indeed, Sir Geoffrey Palmer, in Fish and Game’s submission, wrote a very good opinion on why it was that that was to be the case.

But what needed to be done to the previous clause 3 is much of what is problematic throughout the rest of this legislation. It was muddled, it did not really do what it needed to do, and it was not in a logical way to achieve it. That is a problem that we will be referring to throughout our contributions at this Committee stage—what the problems with this legislation are. We did make some changes at the select committee. We did remove a very cumbersome purpose statement in clause 3 and replaced it with a much shorter, more elegant purpose clause, which now reads: “The purpose of this Act is to require regular reports on New Zealand’s environment.” It was good that we managed to tidy this up, but it was not actually what was asked for by the submitters, who had given very thoughtful submissions on the very purpose of this legislation.

There is a critical piece missing from that purpose statement, and it is for that reason that we will be supporting the Green Party’s Supplementary Order Paper 87, which seeks to insert “the state of”. It is not just about the environment. It is really important that this is about the state of our environment that we are reporting on, when we report on it. It is really important that we capture that in the purpose statement—that we have a very short, a very elegant, and a very well-crafted purpose statement, potentially, that we can put there that gets to the nub of what this legislation purports to do.

Some other changes were made at the select committee to Part 1 of the legislation. These were changes that we were happy to support, and they were unanimous changes for the committee. One of these was the recommendation to insert a Treaty of Waitangi clause at new clause 4A. The insertion of this clause was to make this legislation consistent with other legislation, and recognise the principles of the Treaty. The principles of the Treaty are really important when we are considering environmental reporting and reporting on the state of the New Zealand environment. We were more than happy to support those changes and the work that had been done.

It is a real opportunity that we are missing here. I think that these changes that we want to see to Part 1 and the inconsistencies that we are going to see throughout the legislation—because what we wanted when we first started talking about environmental reporting was independent environmental reporting. That is not what we are getting through this legislation. What we are getting is a piece of legislation where the Minister ultimately has control. That is a problem for us, no matter who sits on the Government benches. It is a problem when there is not independence attached to this kind of reporting. It is not a slur on any particular Minister. What it is saying is that we genuinely want independent reporting on the state of our environment in New Zealand. We have the opportunity to do this, with this legislation. There are some changes that could be made through Supplementary Order Papers that are on the Table and that, if agreed to, would mean that Labour could support this legislation. Fundamentally it is a good idea. But the execution that we are seeing in the bill that we have before us in the Chamber tonight does not fulfil the purpose that we are talking about in new clause 3 of this legislation.

This is a sign that this is a Government that really has lost its way. It is failing to fulfil those objectives that it set out to do. It simply does not do it. It is not a piece of legislation that is fit for purpose, if our aim is to have independent environmental reporting in this country. It is not going to do that. It shows how far out of touch the Government has got on what it needs to be doing. It shows that it is absolutely failing in this task. It shows that this is a Government that has reached the peak of arrogance, when it will not even listen to sensible suggestions from some very well-crafted and thoughtful submissions from some very, very good thinkers who came before the select committee and asked that we did have genuine independence in our environmental reporting legislation. But those pleas, and they were pleas, from many of the submitters fell on stony silence from the Opposition members. They were not willing to think about the ways in which we could improve this legislation. It is an opportunity lost. We could have done it—

Sue Moroney: Government members.

Dr MEGAN WOODS: Sorry, you are quite right. Thank you, Ms Moroney. It was the Government members; the Opposition members were more than willing to listen to the voices of reason and to listen to very well made cases and very thoughtful submissions, as we always are when they come before select committees. Unfortunately—you are quite right, Ms Moroney—it was the Government members who were not willing to listen to those submissions.

This is where we think about the very purpose of the bill. As we go through the stages and go through this bill clause by clause, it is absolutely imperative that we keep that purpose firmly in our minds: what it is that this legislation should be doing and what it is, when we examine other clauses of this legislation such as clause 18, that we will see this legislation does not do, and that it simply fails at that task. I look forward to further contributions on this piece of legislation, but what we have to do is consider very carefully this purpose statement of the legislation so that we can consider the other clauses as we go through and consider it. Thank you.

Hon Dr NICK SMITH (Minister for the Environment): That was a member clutching at straws to try to find a reason to oppose a bill that will substantially improve the integrity of New Zealand’s environmental institutions.

Let me go through and cover each of the three points that Megan Woods raised. Here is the big amendment. The big amendment is that the member wants to add to the purpose clause to require regular reports on New Zealand’s environment, and she wants to add the words “the state of the environment.” This is as dicky as the only bill we have seen from the Labour Party in 6 years of Opposition. The big measure by which it is going to improve the protection of the environment is to add the words “protection of the environment” over and over again, as though somehow that will make things better. Adding the words “the state of the environment” is adding worthless extra words that actually achieve nothing.

Dr Megan Woods: Will you change clause 18?

Hon Dr NICK SMITH: Let us come to clause 18. The member mentions it. She says that it undermines the purpose. What she is saying is that somehow because this bill—

The CHAIRPERSON (Lindsay Tisch): Order! Sorry. No, no. We are not in clause 18. We are actually in Part 1, which is clauses 3 to 5. Just concentrate on that.

Hon Dr NICK SMITH: There has been a question by the member around the independence of the environment reporting. What she is saying is because this bill provides for the capacity for the Minister for the Environment to be able set down regulations in the area of the topics, that undermines the independence of the environmental regime in this bill.

Eugenie Sage: I raise a point of order, Mr Chairperson. The clauses dealing with the Minister setting the topics are in Part 2 of the bill, not Part 1.

The CHAIRPERSON (Lindsay Tisch): I have just asked the Minister to come back to Part 1, clauses 3 to 5, and I am listening.

Hon Dr NICK SMITH: In the purpose of the bill the key issue is that these environmental standards and reports are going to have integrity. My simple challenge for Eugenie Sage and members of the Labour Party is to read the Statistics Act. Every member of this House would have confidence in the independence of the statistics that are produced by Statistics New Zealand. And yet they wrote a law, passed a law, and voted for a law that lets the Minister of Statistics not have to consult, not have to write regulations, but to actually tell the Government Statistician they cannot publish a particular statistic—yes, just direct them—or that they have to produce some other statistic. So my simple challenge for Megan Woods and for Eugenie Sage, if they want to criticise the purpose of this bill and its content—the provisions in it are far more mellow in terms of the roles of the Minister than what there is in the Statistics Act, which they passed and which they would accept is independent.

The third point that was raised by Megan Woods was this: she would prefer that we had the old-style, vague Treaty clauses that just refer to the principles of the Treaty of Waitangi. The difficulty with that—in fact, I have heard, probably, the most eloquent speeches by members of the Opposition—is that vague laws such as those that simply refer to the principles of the Treaty actually work better if we have, as we have drafted in this bill, a Treaty clause that is quite specific about the way in which that Treaty obligation is met. If Labour is back in the position of referring to vague principles, which was the drafting style back in the 1980s, it shows how far out of touch and how lacking in new ideas it is in writing new law. All of the new statutes passed by this Parliament now refer to the specific requirements that go with the Treaty clause so that it is more specific.

I am actually very proud that we are a Government that is implementing a system and putting in place a state of the environment reporting system, a good system, which means we are going to deal with the fact that we are the only OECD country—and my challenge to members of Labour is: where were you for 9 years? Actually, I will tell you where you were. The record is very clear that if you want to talk about interference in environmental reporting, I would ask Labour members to read the history in 2007 when that is exactly what their Minister for the Environment was caught out doing. That is one of the reasons why we committed to bringing this legislation to this House—so that just as in education, where we have open standards of education being reported, and just as we are proud of our history in terms of financial reporting with the Fiscal Responsibility Act, we are applying the same principles in this area, and that is why this part of this bill should be supported by members.

Hon DAVID CUNLIFFE (Labour—New Lynn): Occasionally in this House one comes across legislation with aims that are entirely laudable but implementation that is entirely mistaken. This is one of those bills. Labour and the Greens both supported this legislation to the Local Government and Environment Committee. We did so because we took the Government at its word. This was a bill that was ostensibly designed to improve the quality of environmental reporting. We take no joy, in the Committee stage, in now having to take the floor and say that the select committee’s analysis and the submissions to the select committee have revealed such fundamental flaws in the drafting that we can no longer support the bill. There are such fundamental flaws that we are forced to the position where we believe they are designed-in—let me be clear about why. There is some discussion that we will come to in later parts about clause 18. What so many submitters saw as a fundamental flaw is that Ministers, by regulation, can set the topic.

The ASSISTANT SPEAKER (Lindsay Tisch): No, no—

Hon DAVID CUNLIFFE: I said we will come to that later.

What I wish to turn our attention to is Part 1, clause 3, the amended purpose clause. It is very interesting that the bill as reported back from the select committee described the all-important purpose of the Act as to require—independent reports, perhaps? No, there is nothing about independence. Fact-based reports? No, there is nothing about evidence. It simply requires regular reports, and regular is a bar that is far too low for our precious environment.

The old version of the purpose clause had such radical language as to specify that it wanted regular reports on the state of the atmosphere and climate. It is no wonder the Government did not want that in. Fresh water—I can see why they did not want that in; just go ask Ruataniwha. Land and marine domains—just ask Māui’s dolphin.

The bill had a prior clause 3 that sought to “ensure that the producers of environmental reports act independently and provide fair and accurate reports”. Well, that was all too much for the Government. That got struck out by a majority. The prior clause sought to “ensure that the expertise of government departments is utilised”—that means that it is evidence-based—and to “affirm the role of the Parliamentary Commissioner for the Environment in reporting on environmental reports and the processes that produced the reports.” So the watchdog is not only the watchdog on the issue but the watchdog on the integrity of the process that defines the issue, and both are essential.

What do we find further down in the interpretation clause, clause 4? Well, we scan down, we go to e, f, g, and then we jump to i. The only i word is “impact”. There is no independence defined in the bill. The principle of independence is missing. It has been excoriated from the draft legislation, and the Minister has the temerity to ask why the Opposition can no longer support this mistaken piece of drafting.

It is no accident; this Government has a stock-in-trade technique. It is one that has been employed repeatedly in New Zealand. It is one that the same consultants have advised for Mr Cameron’s British Labour Party, and it is called taking an issue where your opponent is making—

Hon Dr Nick Smith: Mr Cameron’s Labour Party?

Hon DAVID CUNLIFFE: Mr Cameron’s conservatives. Take an issue where your opponents are making ground and cover it, like in a tacking duel of yachts; take the air off it by offering the “lite” version. This bill is “environmental reporting - lite”. It lacks teeth in its purpose clause. It lacks independence. It lacks integrity.

It is not the only time the Government has tried the “lite” version as a way of giving some public impression of progress while ensuring that the vested interests that stand behind it are not too threatened. It has an “emissions trading scheme - lite”, one that will not change behaviour for decades to come and where friends of the Government routinely pop up in the media and say that climate change is a hoax. It has a “capital gains tax - lite”, the one you have when you have not got a capital gains tax. [Bell rung] Mr Chairman?

The ASSISTANT SPEAKER (Lindsay Tisch): The Hon David Cunliffe—but just concentrate. We are not talking about climate change and other things. Just focus on the bill.

Hon DAVID CUNLIFFE: You are quite right; we cannot talk about climate change, except in so far as climate change was specifically struck out by the Government from clause 3 in Part 1. In fact, clause 3(b) required “regular reports on the state of the air, atmosphere and climate”. It no longer does, because the Government took it out. That is why climate change is in the scope of this debate. In the same way that the emissions trading scheme has been watered down and in the same way that paid parental leave was watered down, the role of the Parliamentary Commissioner for the Environment is, in this very section, watered down. The parliamentary commissioner should be the one who is specifying what topics get reported on. The parliamentary commissioner is the independent, evidence-based, and highly qualified agent who can say what should be in the reports. We do not believe it is appropriate that a Minister, a political actor in the Government of the day—and it does not matter whether it is the current Government or the next Government—play a quasi-watchdog role. It is a conflict of interest for the Minister to be the Minister’s own watchdog, and that is why this bill is so fundamentally—

The CHAIRPERSON (Lindsay Tisch): That’s Part 2.

Hon DAVID CUNLIFFE: In Part 1—

The CHAIRPERSON (Lindsay Tisch): Yes, focus on Part 1.

Hon DAVID CUNLIFFE: —the purpose has been reduced in clause 3 to take away anything other than regularity. If I might, this is yet another example of the kind of, to use a big jargon word, reductionism—take a concept as worthy as protection and enshrinement of our environment and then reduce it to something economic, and then reduce that to a business growth agenda, and then reduce that to a private balance sheet, and then privatise the resources of the State so the ability to effect change is more limited. That is the stock-in-trade of this Government.

We are opposing this bill because we are sick of “Government-lite”. We are sick of “environmental protection - lite”. We are sick of “purpose clause - lite”. We want real environmental reporting that is truly independent, not only in the statistics that are employed from report to report—I concur with the Minister on that. Nobody on this side of the House is criticising Statistics New Zealand or its chief executive or its Minister; that is not the issue.

The issue is one of scope, integrity, and the avoidance of the impression of a conflict of interest. The Minister should not constrain the reporting of the Minister’s own outputs. That is why this bill is fundamentally flawed and why it does not, and cannot, achieve its twin objectives of providing independent advice and conveying the public impression of integrity based on evidence—and truly systemic independence, not only in the outputs but in the choice of those outputs. It is in clause 3 in Part 1 of this bill that the reader gets the first clue about what is really going on here. This is a dance of the veils, and the veil that has just come off is that of the Government’s true intent.

Clause 5 in Part 1 is the shortest clause in the bill. It simply says: “This Act binds the Crown.” I believe that that is one reason that the Minister wants to retain the power to set the breadth of the reviews—because the Act does bind the Crown. The Minister does not want the Crown being bound by a report that is directed or defined by an agency independent from it, but in so doing—in imposing the constraint that the Minister has imposed later in this bill—the Minister has actually reduced the perceived value of the reporting exercise to something that, frankly, is not worth the trees that died to produce the legislation.

Clause 4A is also important. It is the Treaty of Waitangi/Te Tiriti o Waitangi clause—and it requires that “In order to recognise and respect the Crown’s responsibility to take appropriate account of … Te Tiriti [it must] provide for te ao Māori”—the Māori world view—“[as] an impact category in preparing synthesis …”. You know, I think future generations of New Zealanders are going to really thank—

Chris Bishop: The National Party. The National Government.

Hon DAVID CUNLIFFE: I was going to say Māori, but it is all New Zealanders and successive Governments, Mr Bishop, whom they will thank for the Treaty of Waitangi. They will thank successive Governments for honouring the Treaty with the return of resources, because they are not resources that are going to leave the country. The Treaty is perhaps the one provision—

The ASSISTANT SPEAKER (Lindsay Tisch): I am sorry; it is time for me to report progress.

House resumed.

The Chairperson reported the Social Assistance (Portability to Cook Islands, Niue, and Tokelau) Bill without amendment, and progress on the Environmental Reporting Bill.

Report adopted.

The House adjourned at 9:56 p.m.