Tuesday, 8 November 2016

TUESDAY, 8 NOVEMBER 2016

TUESDAY, 8 NOVEMBER 2016

Mr Speaker took the Chair at 2 p.m.

Prayers.

Oral Questions

Questions to Ministers

Saudi Agri-hub—Legal Advice and Auditor-General’s Report

1. ANDREW LITTLE (Leader of the Opposition) to the Prime Minister: Why did he say, regarding the Saudi sheep deal, that “the view of Cabinet was that there had been a case that at least the investor could put up, that we may well have to fight that in court”, and was he aware when he made that statement that there was no legal advice assessing the legal risk from the investor’s case?

Rt Hon JOHN KEY (Prime Minister): I made that statement because Cabinet was advised that the Government was exposed to the risk of a between $20 million and $30 million legal claim. We accepted that advice. This is backed up by the Auditor-General’s report, which states that during negotiations Al-Khalaf Group indicated it could be paid compensation of $24 million. Cabinet was satisfied that the full partnership, as outlined in the Cabinet paper, resolved the prospect of any litigation. With regard to legal advice, Cabinet accepted the paper’s advice about the potential legal claim.

Andrew Little: Does he now accept the Auditor-General’s finding that there was no legal advice and no evidence of a legal claim against the Government?

Rt Hon JOHN KEY: I accept the words of the Auditor-General’s report when she says on page 8: “the Al Khalaf Group indicated that it considered it should be paid compensation of $24 million.” [Interruption]

Mr SPEAKER: Order! [Interruption] Order!

Andrew Little: Did Murray McCully inform Cabinet at any time that legal advice had been taken; if not, how did Cabinet form the view that it may have to fight a $20 million to $30 million action in court?

Rt Hon JOHN KEY: Cabinet was advised through the Cabinet paper by the Minister: “Saudi parties had received advice suggesting they pursue a claim of between $20 million to $30 million. The Government has made it clear it would not be a party to such discussions.”

Andrew Little: Did Cabinet insist on seeing legal advice to support that claim?

Rt Hon JOHN KEY: No.

Andrew Little: Was the Auditor-General wrong when she found a settlement of a grievance was provided under the guise of a contract for services—in essence, a sham; if not, why did his Government pay $4 million cash to a man to whom nothing was owed?

Rt Hon JOHN KEY: The only people who were wrong were the Opposition members when they went on and on about how the payments were evidence of corruption, bribery, or a facilitation payment. The Auditor-General found the complete opposite.

Andrew Little: Does he agree with Fran O’Sullivan that “Provost’s findings are a scathing assessment of the lack of transparency around this deal.” and that it does nothing to vindicate Murray McCully?

Rt Hon JOHN KEY: No, but I do find it somewhat amusing that the Leader of the Opposition is quoting the media when, according to Phil Twyford and himself—

Mr SPEAKER: Order! [Interruption] Order!

Economy—Legatum Institute 2016 Prosperity Index

2. BARBARA KURIGER (National—Taranaki - King Country) to the Minister of Finance: What reports has he received on New Zealand’s prosperity?

Hon BILL ENGLISH (Minister of Finance): Last week the Legatum Institute in the UK released its 2016 prosperity index, measuring 149 countries, and rated New Zealand No. 1. Among the subindices, New Zealand rated first in the world for social capital, first for economic quality, second for its business environment, second for governance, and third for personal freedom.

Barbara Kuriger: How is New Zealand’s social capital supporting higher prosperity in New Zealand?

Hon BILL ENGLISH: We have to keep in mind that all these so-called well-being measures have a degree of subjective judgment about them. In this report, the social capital index measures a country’s strength of social networks, social norms, and civic participation. For instance, in this case, it asked New Zealanders whether they have family or friends whom they can rely on in times of need, and 99 percent of New Zealanders say they do—one of the highest proportions in the developed world.

David Seymour: Does the Minister agree with the report’s attribution of New Zealand’s prosperity to “free markets and free people.”?

Hon BILL ENGLISH: Yes, I do, because it is certainly this Government’s view that when people take responsibility for themselves, their families, and their communities, and have the opportunity to participate in a market economy, the results are that they can realise their aspirations.

Barbara Kuriger: How does New Zealand’s wealth and prosperity compare with other countries?

Hon BILL ENGLISH: The point of the index is simply to demonstrate that prosperity is about a wider range of indicators than wealth. For instance, the United States has around 50 percent more wealth per person than New Zealand but ranks 16 places below New Zealand. In fact, 26 countries have higher wealth per capita than New Zealand but are ranked lower than us on the index. Of course, we cannot be at all complacent about this kind of rating, because many New Zealanders still want better opportunities to realise their aspirations.

Barbara Kuriger: What are some of the other factors supporting New Zealand’s prosperity?

Hon BILL ENGLISH: The common links among those countries that are rated higher tend to be free markets, lower non-tariff trade barriers, more competitive regulation, and a more flexible labour market. For instance, over the last 6 years on this index Australia and New Zealand have been moving in opposite directions, with New Zealand tending to rise and Australia tending to drop back a bit.

Grant Robertson: On the subject of that last answer, of Australia and New Zealand moving in opposite directions, can he confirm that the wage gap between New Zealand and Australia has increased since September 2008 to June 2016—now being a 27 percent difference?

Hon BILL ENGLISH: That may be the case; I have not checked the figures recently. Actually, I thought it was 30 percent, which, I think, makes it even more remarkable that the outflow from New Zealand, which was about 40,000 per year to Australia, of New Zealand citizens is now down to about 3,000 a year. There must be some reason why Kiwis are deciding to stay here when wages on average in Australia are significantly higher.

Drinking-water Supplies—Mayfield

3. RICHARD PROSSER (NZ First) to the Minister of Local Government: Does he stand by his statement on 23 September 2016, “It is imperative that steps are put in place to ensure core infrastructure including water, sewerage, and roads across New Zealand are well managed. Failures of infrastructure and service are unacceptable to New Zealanders”?

Hon LOUISE UPSTON (Acting Minister of Local Government): Yes, under the Local Government Act of 2002, local authorities are responsible for providing communities with good quality and cost-effective local infrastructure and local public services.

Richard Prosser: How does the Minister reconcile that answer with the fact that the Ashburton District Council has told Mayfield residents that their water supply will soon be coming from stock water because the bore is so low?

Hon LOUISE UPSTON: The responsibility of local water supply is for the Ashburton District Council. I am advised that the council is taking appropriate steps to manage this issue.

Richard Prosser: Does the Minister find it acceptable that a Resource Management Act - driven change in the type of irrigation consented ad infinitum by the Ashburton District Council has contributed to the depletion of the bowl that the Mayfield bore draws from?

Hon LOUISE UPSTON: I would refute the assumption that is made and repeat my answer that the responsibility of safe drinking-water for Mayfield and the community there is the responsibility of the Ashburton District Council.

Richard Prosser: Does the Minister acknowledge that access to Canterbury’s ample artesian water could be made available to towns such as Mayfield if local authorities had access to funding from a royalty on the export of water?

Hon LOUISE UPSTON: That is an interesting theory that that member has. As I said before, the responsibility for the supply of safe drinking-water is for the Ashburton District Council. I am not sure that, given the distance from Mayfield, the council is going to be driving bottles of water out to the community there, but I am sure it is considering all options.

Saudi Agri-hub—Auditor-General’s Report and Trade Negotiations

4. JAMES SHAW (Co-Leader—Green) to the Prime Minister : Does he accept all of the findings regarding his Government in the Auditor-General’s report into the Saudi Arabia Food Security Partnership; if not, which findings does he not accept?

Rt Hon JOHN KEY (Prime Minister): Yes.

James Shaw: Does he accept the finding in the Auditor-General’s report that “Settlement of a grievance was provided under the guise of a contract for services.”?

Rt Hon JOHN KEY: Yes, although the line I would rely on is one that says: “The arrangements entered into were a lawful use of public resources, and public money was spent with appropriate financial authorities in place.”

James Shaw: Does he accept her finding that the contract was “A convenient mechanism by which the allocated $10 million, later $11.5 million, was put towards achieving those unstated objectives.”?

Rt Hon JOHN KEY: Yes, but I would rely heavily on the statement she made when she said that payments did form “part of a legally valid contract for services. Public money was spent within the necessary financial approvals.”

James Shaw: Does he accept the Auditor-General’s finding that one of the purposes of the contract was to resolve a diplomatic issue between Governments?

Rt Hon JOHN KEY: Yes, the Government said that one of the objectives was to try to speed up the Gulf States free-trade agreement.

James Shaw: Is it now his Government’s policy to make financial payments to the tune of millions of dollars to any influential individual who can facilitate a trade deal?

Rt Hon JOHN KEY: No. As the report says: “The arrangements entered into were a lawful use of public resources, and public money was spent with appropriate financial authorities in place.” I think every New Zealander can see that Labour and the Greens completely over-egged this, and now they have been caught embarrassed and now they are foraging around in the asterisks and the sub-sub-prints because there is just nothing there that is wrong, according to the Auditor-General, in the more substantive parts.

James Shaw: Given his comment that—[Interruption]

Mr SPEAKER: Order! I invite the member to start the question again.

James Shaw: Thank you, Mr Speaker. Given his comment that this contract gets us “an agribusiness hub which allows us to promote New Zealand”, why was a cameraman employed by New Zealand journalists denied access to the farm, detained by the police, and had their equipment confiscated?

Rt Hon JOHN KEY: I do not have those details. You would need to direct them to the Ministers.

James Shaw: How is it that a Government that paid $11 million for a “showcase of New Zealand agricultural expertise and technology” has to ask for permission to even visit this supposed showcase?

Rt Hon JOHN KEY: We spend a lot of money in the intelligence and security area. I think you might need to ask permission to go and see some of that, as well.

Youth Unemployment—Beneficiary Numbers and Employment Support

ANDREW LITTLE (Leader of the Opposition): My question is to the Prime Minister. Has he sought an explanation from Paula Bennett as to why the—

Mr SPEAKER: Order! Could I just ask the—[Interruption] Order! Could I just ask the member to read the question as it is on the sheet. [Interruption] Order!

Rt Hon John Key: You have to ask the primary before you ask the supp—that’s the way it works.

Mr SPEAKER: Order! And none of us needs the advice and assistance from the Prime Minister.

ANDREW LITTLE: The Prime Minister might want to spend more time on the Cabinet Manual than he does on the Standing Orders. My question is to the Prime Minister—[Interruption]

Mr SPEAKER: Order! [Interruption] Order! We have now spent enough time, with interjections coming from both sides of the House. If I need to get a bit more forceful, I can do so.

5. ANDREW LITTLE (Leader of the Opposition) to the Prime Minister: Has he sought an explanation from the Minister for Social Development as to why the number of 18- to 24-year-olds receiving the Jobseeker Support - Work Ready payment who have been on a benefit for more than a year is rising?

Rt Hon JOHN KEY (Prime Minister): No.

Andrew Little: Why are there 30 percent more young people on the job seeker allowance today than in 2012?

Rt Hon JOHN KEY: I cannot verify that number, but what I can verify is that the number of 18- to 20-year-olds on job seeker support has fallen by 14 percent over the last 5 years.

Andrew Little: I seek leave to table a document from the Parliamentary Library showing the 18- to 24-year-old job seeker numbers calculation from 2012 to 2016, showing that 30 percent increase.

Mr SPEAKER: I will put the leave. Leave is sought to table that particular document. Is there any objection? There is objection.

Andrew Little: Why are there 11,400 more young people not in employment, education, or training now than in 2008?

Rt Hon JOHN KEY: I cannot verify those numbers, but the truth is that Labour cannot verify its own numbers, even when it calls it a policy.

Andrew Little: I raise a point of order, Mr Speaker. [Interruption]

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

Andrew Little: I seek leave to table calculations made by the Parliamentary Library showing young people not in employment, education, or training from 2008 to 2016 increased by 11,400.

Mr SPEAKER: I will put the leave. Leave is sought to table that particular document from the Parliamentary Library. Is there any objection to it being tabled? There is. [Interruption] Order! I have put the leave. [Interruption] Order! The front bench to my right and, certainly, some members to my left need to settle down and minimise the interjection.

Andrew Little: Why does his Government think these young people are, to quote Bill English, “pretty damned hopeless”?

Rt Hon JOHN KEY: Firstly, that is inaccurate but, secondly, actually, if one looks at the people in the category of 15- to 24-year-olds, what we know is that the number of people who are not in education, employment, or training has been dropping dramatically. In fact, the 15- to 19-year-olds number is nearly at the lowest that it has been since the series was collated. Given the strength of the labour markets, I would have thought the best thing to do is to ensure that those youngsters get an opportunity for a real job.

Andrew Little: Does he stand by his statement that unemployed young people “just cannot muster what is required to actually work”; if so, why has he given up on 74,000 young New Zealanders?

Rt Hon JOHN KEY: I raise a point of order, Mr Speaker. I just ask the Leader of the Opposition to verify that I made that—

Mr SPEAKER: Order! That is not a point of order. The question has now been disrupted. I think the only fair way forward is for me to invite the member to ask the question again.

Andrew Little: Does he stand by his statement that unemployed young people “just cannot muster what is required to actually work”; if so, why has he given up on 74,000 young New Zealanders?

Rt Hon JOHN KEY: If it is a genuine quote and not made up, I would have to see in what context it was made.

Andrew Little: When will he stop talking down our young people as lazy and drug-addled, and instead invest in their futures and get them ready for work—just as Labour is proposing to do?

Rt Hon JOHN KEY: Well, if one looks at the economic reforms undertaken by this Government and the results of them, you would have to say that they are pretty stunning. They include an unemployment rate that is the lowest since 2008; 357,000 more jobs since 2009—35,000 jobs in the last quarter; and more people in apprenticeship training than we have seen in a very long time—42,000. Far from talking down young New Zealanders, we are creating opportunities for them. Just because the Leader of the Opposition cannot actually get a policy right at his 100th annual conference, and is now being known as “Angry Andrew” with the—

Mr SPEAKER: Order! We have certainly gone far enough now. [Interruption] Order! I do not want to hear that interjection across the House.

Darroch Ball: Can he confirm that the National - New Zealand First coalition Government in 1996 included New Zealand First’s community wage scheme, which was aimed at providing minimum-wage work for long-term beneficiaries, like clearing waterways for the Department of Conservation (DOC)?

Mr SPEAKER: Order! No. There is just no prime ministerial responsibility for that at all. [Interruption] Order! I have made a ruling. It is not open to debate. If the member has a fresh point of order, I am only too happy to hear it. But if it is in any way questioning where we have just been—

Darroch Ball: Can I rephrase it?

Mr SPEAKER: I think that is a very wise decision by the member.

Darroch Ball: Has he seen any reports that can confirm that the National - New Zealand First coalition Government in 1996 included New Zealand First’s community wage scheme, which was aimed at providing minimum-wage work for long-term beneficiaries, like clearing waterways for DOC?

Rt Hon JOHN KEY: Yes. I have seen a report that said that when one looked at the calibre of the New Zealand First members that became part of that Cabinet, that truly was a make-believe—

Mr SPEAKER: Order! [Interruption] Order! If Mr Chris Bishop wishes to stay for the rest of the day, then, when I rise to my feet, he shuts up.

Darroch Ball: Has he seen reports that show that the New Zealand First community wage scheme from the coalition agreement bears an uncanny resemblance to a newly announced policy Ready for Work—the very policy that Labour scrapped in 2001—putting those 18- to 24-year-olds who were on the scheme back on the dole with nothing?

Rt Hon JOHN KEY: No. But what I can say is 20 years on if one looks at the state of the labour markets, given how many jobs are being created, I think the average New Zealander would say that it makes a lot more sense to put those youngsters into a real job, which they are actually in the process of getting in quite record numbers, as opposed to sending them bush.

International Education—Value and Effects

6. Dr JIAN YANG (National) to the Minister for Tertiary Education, Skills and Employment: What recent reports has he received on the value of international education to New Zealand?

Hon STEVEN JOYCE (Minister for Tertiary Education, Skills and Employment): Today I received a report that shows that the economic value of New Zealand’s international education sector rose to $4.28 billion last year—a 50 percent increase from what the sector was last measured at in 2014. The report, produced for Education New Zealand by Infometrics and the National Research Bureau, showed the industry supported 32,000 jobs in 2015, and the combined onshore and offshore delivery of international education is now New Zealand’s fourth largest export industry, overtaking the wood-processing sector. This report highlights that we are well on our way to delivering on the 2010 target to lift the economic value of international education to $5 billion by 2025.

David Seymour: What would be the effects on this industry of reducing net permanent and long-term arrivals into New Zealand to 15,000 as some have advocated?

Hon STEVEN JOYCE: The member asked a fair question. The definition of permanent and long-term migrants is anybody who is in the country for more than a year, particularly, the higher-level students—the degree, Master’s, and PhD students. They generally are in the country for longer than that period because it takes longer to actually achieve their qualifications. They are, of course, the sorts of people we want to attract. So if you dropped it to about 15,000, then, obviously, we would not be able to continue with that part of the industry.

Dr Jian Yang: Why is international education important to New Zealand?

Hon STEVEN JOYCE: Although the economic value and the jobs it provides are important, one of the other important areas is the wider benefits that the international education sector brings to our country. International students add a rich diversity to our learning institutions, and they help to connect New Zealand to the world. Right back to the Colombo Plan, the relationships and networks developed with people from around the world through international education play a vital role in New Zealand’s business relationships with other countries. The relationships being formed now will help to secure New Zealand’s trading, investment, and education linkages for our future prosperity.

Dr Jian Yang: What impact is the growth of international education having across New Zealand?

Hon STEVEN JOYCE: One positive highlight of the report is the widespread growth of the sector, with total student numbers up 25 percent from 2012, and all sectors showing an increase. Primary schools have gone up significantly, as have private training establishments, secondary schools, and so on. The sector also grew in all regions between 2012 and 2015. The largest value growth by region was in Auckland, which experienced a 55 percent increase. Canterbury grew 71 percent in the same period, Waikato grew 45 percent, and the South Island, excluding Canterbury and Otago, grew 152 percent. That reflects the efforts of education providers nationwide to deliver excellent education around the country.

Question No. 5 to Minister

ANDREW LITTLE (Leader of the Opposition): I seek leave to table a transcript from RNZ National from 5 September 2016 in which the Prime Minister states, amongst other things, in relation to young people: “or they just can’t muster what is required”—

Mr SPEAKER: Order! No. Those transcripts are available and easily sourced by any member if they want them.

Health Services—Funding and Access

7. Hon ANNETTE KING (Deputy Leader—Labour) to the Minister of Health: Does he stand by all his statements?

Hon Dr JONATHAN COLEMAN (Minister of Health): Yes, including my comment that you always have to check the facts, check the numbers, and ask lots of questions until you get the truth about any Labour Party claim.

Hon Annette King: Does he stand by his statement that “in ophthalmology there are one or two DHBs that need to lift their game,” when it has been revealed over the last week that there are huge delays in Counties Manukau District Health Board, Nelson Marlborough District Health Board, and Southern District Health Board for follow-up appointments, and that there is no time frame for follow-up treatment for thousands of New Zealanders with eye conditions that can lead to blindness?

Hon Dr JONATHAN COLEMAN: Yes.

Hon Annette King: Why did he not listen to Treasury and put in a bid for primary care reform last year, knowing that one in nine New Zealanders cannot afford to visit a GP, and the chair of his own working party advised that it had “left many low-income patients out in the cold.”?

Hon Dr JONATHAN COLEMAN: Actually, it is not Treasury that sets policy. [Interruption]

Mr SPEAKER: Order! We will just have the supplementary question.

Hon Annette King: How can he continue to claim that health has sufficient funding when the professor of orthopaedic surgery in Dunedin said yesterday: “Due to lack of resources about a third of referrals from GPs cannot be seen … [and it is] getting worse.”?

Hon Dr JONATHAN COLEMAN: Simply because health has had an extra $2.2 billion in the last Budget over the next 4 years for pressures and new initiatives, including a record $568 million. But, of course, the point is that we are focused on results.

Hon Annette King: Is the reason he is allowing district health boards to send letters to frail older New Zealanders telling them that their home help will be stopped unless they also require personal care services that that is the way to reduce costs, at the expense of very vulnerable people?

Hon Dr JONATHAN COLEMAN: No.

Hon Annette King: I seek leave to table a letter from MidCentral District Health Board to an older New Zealander telling them exactly what I have just said.

Mr SPEAKER: Order!

Hon Annette King: It is dated 1 November this year.

Mr SPEAKER: Order! It has been described. Leave is sought to table that letter from the district health board. Is there any objection? There is none. It can be tabled.

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

Emergency Housing—Government Initiatives

8. MELISSA LEE (National) to the Minister for Social Housing: What announcements has she made about the Government increasing support for emergency housing?

Hon PAULA BENNETT (Minister for Social Housing): Yesterday I was pleased to announce a funding boost of more than $300 million for emergency housing so that more vulnerable New Zealanders can get the help that they need. We have the funding to pay for an extra 1,400 places at any one time, which will be, I must say, an ambitious goal, but we have a cross-agency team set up to secure and build suitable properties. This is just another step in the Government’s comprehensive plan to secure more emergency social and affordable housing.

Melissa Lee: How will the $300 million be spent?

Hon PAULA BENNETT: The first thing we need to do is actually build the supply, because we have already paid for the current beds that are available, so $120 million is in capital funding—[Interruption] I am looking forward to Phil Twyford’s question—to build, buy, and lease as many houses as that will get us. There is $71 million in rental subsidies, which will be going to a number of providers to pay for the rent. [Interruption]

Mr SPEAKER: Order! Some of us might want to listen to the answer. The Hon Paula Bennett—does she wish to continue?

Hon PAULA BENNETT: Certainly I do, Mr Speaker. The good news is that we are also putting $102 million into the wraparound support for those tenants, and that is a component that manages the actual tenancy but also works on some of the issues that people might have around budgeting, debt, or some counselling services, so that we can stabilise them, put them into permanent housing, and then stick with them—and also some funding for front-line staff.

Melissa Lee: What other proposals has she seen to fund emergency housing?

Hon PAULA BENNETT: I have seen another proposal, which also claims to provide 1,400 new emergency housing beds, but it is worth only $15 million a year. This is because it does not pay to find new supply, which is the main problem, or pay for the much-needed wraparound services that these tenants desperately need. One policy equates to $67 million over 4.5 years, and ours, of course, is fully funded. I suggest you get your numbers right, Phil.

Phil Twyford: How much of the $300 million announced yesterday is recycling the $500 million that the Government has taken out of Housing New Zealand in dividends, and to what extent has the sudden discovery of a housing crisis been influenced by the Mount Roskill by-election?

Hon PAULA BENNETT: Unlike the other side, I am not playing politics with these people’s lives; I am actually doing something about it. So that $300 million, quite frankly—we are actually the first Government to ever, ever, step in and fund emergency housing beds, so although Labour ignored it, we are actually doing something about it.

Pike River Mine Disaster—Re-entry and Recovery Operation

9. RON MARK (Deputy Leader—NZ First) to the Prime Minister: Does he stand by his statement in relation to the Pike River Mine that “What I did promise is that we could do everything we can to get those bodies out”?

Rt Hon JOHN KEY (Prime Minister): Yes.

Ron Mark: Is he aware that non-mining contractors and personnel have been working on the reversible seal without breathing apparatus, which contradicts the risk assessment conducted by Solid Energy claiming that it could not be done, and vindicates the expert advice to the families of the 29 victims, as witnessed by Minister Barry in her last visit to the mine?

Rt Hon JOHN KEY: No. But what I am aware of is the advice that we have received from Solid Energy that the environment has not materially changed since the decision not to re-enter the drift was made in 2014.

Ron Mark: With recent testing results showing gas levels within the Pike River mine are safe enough for re-entry, will he now take steps to get the bodies out of the mine so that the families can have their men back and closure; if not, why not?

Rt Hon JOHN KEY: As the member will be aware, the decision to enter or not re-enter the mine is not one that I think a politician should make; nor have I ever claimed I could make. We have taken the best advice, or at least Solid Energy has, as the owner and occupier of the mine. As I have always said, one of the worst things we could do is now put at risk the lives of fellow New Zealanders, as a result of the tragedy.

Hon Damien O’Connor: Why will the Prime Minister not honour his commitment to the families and fund an independent expert to assess the situation at Pike River, not rely on the advice from Solid Energy, a company that the Government has, effectively, sold out?

Rt Hon JOHN KEY: I believe I have met all my commitments to the families.

Environmental Protection Authority—Chief Scientist’s Statements about Waikato River

10. CATHERINE DELAHUNTY (Green) to the Minister for the Environment: Does he agree with the Environmental Protection Authority’s Chief Scientist Jacqueline Rowarth’s comment that the Waikato River is one of the five cleanest rivers in the world?

Hon Dr NICK SMITH (Minister for the Environment): Dr Rowarth’s comments were made prior to her taking up her position with the Environmental Protection Authority (EPA), when she was a professor at Waikato University. I am advised by her that her comments were taken out of context. Water quality in the Waikato is superb and amongst the very best in the world in the upper reaches, like around Huka Falls, but deteriorates in the lower reaches due to nutrients, pathogens, and sedimentation, particularly below the confluence of the Waipā River. The data shows that in the lower reaches these problems have been increasing in recent decades, and steps are required to reverse those trends. That is why this Government has invested over $300 million in its clean-up. I do note the EPA does not have a role in the regulation of water quality, and its principal function is the regulation of hazardous substances and new organisms.

Catherine Delahunty: Does he consider that the comments of the new chief scientist at the EPA show a robust understanding of science and of a waterway that has more than $8 million of Government funding dedicated to cleaning it up because it is so seriously polluted?

Hon Dr NICK SMITH: The Government is spending a lot more than $8 million; it is spending over $300 million—such is the importance of Lake Taupō and the Waikato River to this Government. In respect of this particular individual, I think the member should be cautious of taking her comments out of context, because, actually, in the upper reaches, the water quality is very good at Huka Falls, and it would be wrong for the Green Party to run that down.

Catherine Delahunty: Given that the New Zealand Freshwater Sciences Society, comprising 400 freshwater scientists and professionals, disputes Dr Rowarth’s full claims, should we have faith that the EPA is able to make good decisions about hazardous chemicals and water and protect our environment?

Hon Dr NICK SMITH: Professor Rowarth, who is a new appointment to the EPA, is a well-qualified scientist. The decision as to her appointment has been made independently by the EPA, and I think this House should be cautious of being openly critical of neutral public servants, which is the new role she has, after completing her term as a professor at Waikato University.

David Seymour: Will the Minister rule in or out invoking section 142 of the Resource Management Act and appointing a board of inquiry for the Healthy Rivers: Plan for Change/Wai Ora: He Rautaki Whakapaipai, in light of complaints from farmers in the area that it will put them out of business?

Hon Dr NICK SMITH: The process under the Resource Management Act, where I as Minister can call in a planned change, is only time limited to a period prior to the notification. The notification of the planned changes on the Waikato River that are publicly available for submissions right now has passed that point where I could intervene, but it would be unusual for the Government to step in and, effectively, take over a regional council’s most important function of water quality. We did choose to do so in Canterbury; I am reluctant to do so in the Waikato.

Catherine Delahunty: So, to be clear, is the Minister saying that his new chief scientist at the EPA, who only just made that statement weeks before she started the job, is competent to make judgments about the environment when she says that Waikato is one of the five cleanest rivers in the world?

Hon Dr NICK SMITH: Firstly, I would dispute the claim that it is “my” Environmental Protection Authority. When this Government set up the Environmental Protection Authority, we quite deliberately made it independent, and it is the Environmental Protection Authority that has appointed the chief scientist. The second point I would make is that Professor Rowarth has made plain that her comments have been taken out of context and, actually, would be quite appropriate for the upper reaches of the river, such as the Huka Falls, where water quality is exceptional.

No

Question . 5 to Minister

Rt Hon JOHN KEY (Prime Minister): I raise a point of order, Mr Speaker.

Grant Robertson: To table the text?

Rt Hon JOHN KEY: Yes, exactly. I seek leave to table the full quote that the Leader of the Opposition used, and it says: “we have been trialling a domestic RSE scheme. But go in and ask the employers”—get them on the show—“and they will say some of these people won’t pass a drug test, some of these people won’t turn up for work”—[Interruption]

Mr SPEAKER: Order! [Interruption] Order! First of all, points of order need to be heard in silence. I was attempting to hear it, but I think I have heard enough, though. The point of tabling documents is to better inform Ministers and members of the House. What I think the Prime Minister is attempting to do is take the opportunity to politically engage with a quote that he thinks was not given in full. That is not the purpose of tabling a document, and I will not put the leave.

Hon GERRY BROWNLEE (Leader of the House): Speaking to the point of order.

Mr SPEAKER: I have already dealt with the matter, Mr Brownlee.

Hon GERRY BROWNLEE: Well, I would just ask, then, that you consider the Standing Order that makes it clear that if a member is misrepresented in the House, they have a right to take the floor of the House to correct that misrepresentation.

Mr SPEAKER: And that is done in a very different way. If the member thinks that he has been misrepresented, he seeks leave to make a personal explanation. I would then put the leave to the House. That is the way it is then tackled. It is not done by simply rising to table a document or a quote. We are moving now to—

Rt Hon JOHN KEY (Prime Minister): I seek leave to make a personal explanation so I can read the full quote, which will show that I was misrepresented by the Leader of the Opposition.

Mr SPEAKER: Order! [Interruption] Order! Leave is sought for the Prime Minister to make a personal explanation. Is there any objection to that being done? There is none.

Rt Hon JOHN KEY: OK, let me go back and read the full quote, then: “and we have been trialling a domestic RSE scheme. But go and ask the employers—get them on this show—and they will say some of these people won’t pass a drug test, some of these people won’t turn up for work, some of these people will claim they have health issues later on. So it’s not to say there aren’t great people who transition from Work and Income into work, they do, but it’s equally true that they’re also living in the wrong place, or they just can’t muster what is required to actually work.”

Economic Growth—GDP Per Hour and Wage Growth

11. GRANT ROBERTSON (Labour—Wellington Central) to the Minister of Finance: Does he agree with Nobel Prize-winning economist Paul Krugman, “A country’s ability to improve its standard of living over time depends almost entirely on its ability to raise its output per worker”; if so, can he confirm that real GDP per hour worked has not grown in New Zealand since 2012?

Hon BILL ENGLISH (Minister of Finance): In answer to the first question, yes. In answer to the member’s second question, the member keeps picking on the measure he can find that he thinks indicates lack of economic progress. GDP expenditure per capita is up 0.7 percent, and GDP production per capita is up 5.9 percent. Then the member picked on real disposable income per capita, which is up 7.9 percent. It is not surprising that GDP per hour has not risen much since 2012, for two reasons: one is that in the recession prior to that, including in Christchurch, where they had a massive earthquake, the number of hours worked dropped sharply, so then it had to pick up strongly from 2012. Unlike the member, we believe that having more people in work is actually a very good thing. More people working, with the highest participation rate in the developed world, is an indicator of success, and because it actually probably cannot rise much further, we are likely to see GDP per hour growing.

Grant Robertson: Is real GDP per hour worked lower as at September 2016 than it was in September 2012?

Hon BILL ENGLISH: I cannot confirm that or otherwise, but now that I see the member has outsourced his economic advice to the New Zealand Herald can I tell him this: The Economist has an introductory offer of $5 a week for 12 weeks, and I am sure that if the member tells it that he is the Opposition spokesman, it will throw in steak knives—

Mr SPEAKER: Order! [Interruption] Order! [Interruption] Order!

Grant Robertson: Is it correct that in the data released last week, average hourly earnings grew by 1.7 percent in the September quarter, approximately half the growth of the same time last year?

Hon BILL ENGLISH: Yes. The wage growth looks moderate when you look at nominal wage growth, but, of course, inflation has been upgraded to 0.4 percent—

Hon Steven Joyce: For the year?

Hon BILL ENGLISH: —for the year. So real wage increases have been occurring year on year for a number of years in this economy, which makes it pretty distinctive from many other developed economies. But what I have not figured out is how Labour’s tax on employing migrants is somehow going to fix this.

Grant Robertson: How does he expect New Zealanders to get ahead with pitiful wage growth and low productivity, and stacked up against an annual increase of 13 percent in housing costs and renters facing an average increase of nearly 800 bucks a year?

Hon BILL ENGLISH: I am very pleased for those—I think 135,000 New Zealanders—who have a job now that did not exist just a couple of years ago. So the difference for them between having no job and having a job does amount to getting ahead. As I pointed out to the member, the fact that we have had large numbers of people come into the workforce does mean that productivity per hour worked has been relatively flat, because there have been so many more hours worked. In an economic cycle you will see that as the entrants slow down, productivity per hour is likely to rise.

Small Businesses—Government Initiatives

12. KANWALJIT SINGH BAKSHI (National) to the Minister for Small Business: What steps has the Government taken to make it easier for small business to hire employees?

Hon CRAIG FOSS (Minister for Small Business): Small businesses are hiring more employees. Over the past year 144,000 more people have gained employment, and according to the recent ANZ Business Outlook survey a net 21 percent of businesses are expecting to hire more staff. This Government continues to make it easier for small businesses to hire employees, through policies such as implementing the 90-day trial and the starting out wage; reducing costs, such as lowering personal and company taxes; lowering ACC levies; and providing free online tools such as the Employment Agreement Builder. Those policies and more make it easier for small businesses to hire employees. That is why this Government is better for business.

Kanwaljit Singh Bakshi: What reports has he seen from small businesses concerned about additional costs on small businesses that hire employees?

Hon CRAIG FOSS: I have seen a report from Business New Zealand that is concerned that smaller businesses would suffer if they were charged to hire employees. I have seen a report from Tourism Industry Aotearoa that says putting a levy on small businesses to hire employees would fall on its face pretty quickly. I have seen a report where, when asked about taxing small businesses to hire employees, Labour MP Stuart Nash said, and I quote—

Mr SPEAKER: Order! [Interruption] Order!

Grant Robertson: I raise a point of order, Mr Speaker. The Minister has no responsibility for those matters or, indeed, misrepresenting policy.

Mr SPEAKER: Order! [Interruption] Order! No, I think on this occasion Grant Robertson is absolutely right. As I listened to the answer that was given, it was relatively clear to me that the question was put down as a question simply designed to attack the Opposition. That, of course, is a breach of Speaker’s rulings.

Hon CRAIG FOSS: I raise a point of order, Mr Speaker.

Mr SPEAKER: Order! I am certainly—[Interruption] Order! I am always grateful for assistance, but on this occasion I do not need it. I am always grateful to hear a point of order, but if it is in any way disputing a ruling I have just given, I would be most upset and would deal with it quite severely.

Hon CRAIG FOSS: No, I just wanted to better inform the House of—

Mr SPEAKER: Order! That is not the purpose of a point of order. [Interruption] Order! That is not what we use points of order for.

Urgent Debates Declined

Federated Farmers Waikato—Report on Farm Environment Plans

Mr SPEAKER: I have received a letter from Barbara Stewart seeking to debate, under Standing Order 389, the report prepared by a consultant for Federated Farmers Waikato on farm environment plans required by Waikato Regional Council under its notified plan change. For there to be an urgent debate, there must be a particular case of recent occurrence that involves administrative or ministerial responsibility of the Government. There is no ministerial responsibility for a report released by Federated Farmers, nor for the actions of a local authority, and I refer members to Speaker’s ruling 176/2. The application is, therefore, declined.

Bills

Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill

First Reading

Hon SIMON BRIDGES (Minister of Energy and Resources): I move, That the Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill be now read a first time. I nominate the Commerce Committee to consider the bill. This bill will encourage—[Interruption]

Mr SPEAKER: Order! [Interruption] Order! I do apologise. The Minister has the floor, so for other members who are leaving the Chamber, would they do so in a way that does not interrupt the Minister speaking.

Hon SIMON BRIDGES: This bill will encourage innovation, such as emerging energy technologies and business models, so that New Zealand has the ability to respond to its changing environmental and energy objectives. New Zealand’s environmental and energy priorities have been evolving. This Government is committed to improving the efficiency of our energy use and to meeting our climate change commitments. We need a shift in focus to reduce our emissions and improve our energy productivity, and transport energy and process heat are key areas where gains can be made. I am excited about the new and emerging technologies that can be used to realise these opportunities.

Ninety-nine percent of transport energy comes from non-renewable sources, so increasing the uptake of electric vehicles offers huge potential for reducing emissions. The energy that our industries use to create heat for processing—for example, for drying milk—is also largely non-renewable. There are opportunities to improve the efficiency of this energy use and to switch to using renewable energy sources or more efficient non-renewable sources, like gas, instead. Changing business models in the electricity industry are also part of the picture. The bill makes changes to ensure our legislation is fit for purpose and provides for innovation.

The legislative changes in this bill are not large or complex. We found that our legislation does not need much change to provide for this emerging innovation, but the changes we are proposing will make a significant difference. The bill is an omnibus bill in four parts. The bill will amend the Electricity Industry Act 2010, the Energy (Fuels, Levies, and References) Act 1989, the Land Transport Act 1998, and the Road User Charges Act 2012 to support this focus on reducing emissions and improving energy productivity, while ensuring our legislation can accommodate innovation.

The bill will achieve all this through four key measures. First, the bill will make it possible for the Energy Efficiency and Conservation Authority (EECA) to focus more on improving New Zealand’s energy productivity and reducing carbon emissions. EECA is the Crown entity that works to encourage, promote, and support energy efficiency, energy conservation, and the use of renewable sources of energy. Under EECA’s current funding model, its entire levy funding—almost half of its total funding—is recovered from the electricity efficiency levy, which can be spent only on electricity efficiency activities. The bill enables the cost of EECA’s activities to be spread across the levies for transport fuels and gas, as well as electricity. This move beyond electricity will enable EECA to use its levy funding to undertake a broader range of activities, giving it flexibility to focus on areas where the gain is the greatest.

An example of this is EECA’s electric vehicles promotional campaign and the low-emission vehicles contestable fund. The bill enables this flexibility in a way that recognises the importance of transparency and accountability, and how levy money is allocated and spent. Regulations will follow to further implement the policy intent. This change also complements parallel work I am undertaking to refresh New Zealand’s energy efficiency and conservation strategy, which drives EECA’s work programme, and the development of wider renewable energy targets for New Zealand.

Secondly, the bill clarifies that a road controlling authority may use its by-law making powers to give electric vehicles access to special vehicle lanes. This measure covers electric vehicles that are powered solely by electric batteries, as well as plug-in hybrid vehicles that operate on a combination of externally charged batteries and a petrol or diesel motor. Electric vehicles offer a way to leverage greater value from New Zealand’s renewable electricity and therefore offer the most potential for emissions reduction while ensuring economic growth. We have seen that allowing electric vehicles in special vehicle lanes is the single-most effective non-financial incentive we can put in place to increase uptake. This is evident in places like Norway and California. It will ultimately be a decision for road controlling authorities like the Transport Agency and the regional councils to balance other transport objectives when deciding which special vehicle lanes to allow electric vehicles access to. I encourage them to seriously consider these matters, but I believe that trials are a good way to initially test this around New Zealand.

Thirdly, the bill will enable heavy electric vehicles, such as electric trucks and buses, to be exempted from road-user charges. This mirrors the current exemption for light electric vehicles. Extending the road-user charges exemption to heavy electric vehicles is a transparent and efficient way to provide a financial incentive to encourage heavy electric vehicles over equivalent conventional heavy vehicles. The intention is that the exemption for heavy electric vehicles will be in place until they comprise 2 percent of the heavy vehicle fleet.

Lastly, the bill clarifies how electricity industry legislation applies to secondary networks. Secondary networks are smaller electricity networks that indirectly connect to the national grid, typically through a local distribution network. They offer a unique business model that is becoming more widespread. Owning and operating a secondary network offers business owners greater opportunities for integrating new energy technologies such as combining solar photovoltaics and battery storage on a residential subdivision and for supplying those to consumers. Such innovations should be encouraged. Consistent treatment under the legislation will help this business model endure. The bill will provide regulatory certainty and improve consumer and market outcomes. It will ensure that consumers on secondary networks have the same access to dispute resolution as consumers on local electricity networks.

The measures contained in this bill will assist the Government and New Zealand to respond to our energy-related challenges and climate change commitments. We need to ensure we target where the greatest gains can be made. The bill enables a focus on transport and process heat. It will encourage innovation by providing for emerging technologies, ensuring evolving business models in the electricity sector are accommodated. Alongside other work the Government has under way, and with concurrent changes to rules and regulations needed to give full effect to some of the bill’s changes, I consider that this bill will make a great contribution to New Zealand’s efforts to reduce our emissions and improve our energy productivity. I commend this bill to the House.

STUART NASH (Labour—Napier): Labour will be supporting this bill to select committee. I do believe that there are some great initiatives in here, but I am very keen to hear what the public has to say about this. One thing that I think the Government could really do to drive innovation is actually lead by example. It would have been a couple of months ago that Mr Bridges, as the Minister, was on television—it was actually a great photo and news opportunity—promoting the registration of the 1,000th electric vehicle. It was a great piece of news because we need to encourage this, but the interesting thing about this is that Mr Bridges turned up to this photo opportunity in this huge, big diesel BMW, got out, had the photo taken, cut the ribbon, jumped back in this huge, big diesel BMW, and drove back to Parliament.

I would have thought that the best way to really provide innovation, and the greatest way to show that the Government is serious about this—certainly when it comes to electric vehicles—is to at least have the Minister of Energy and Resources driven around in an electric vehicle. I would have thought that the Crown fleet should all be electric vehicles, and there is absolutely no reason why it should not be. In fact, I was talking to a gentleman who knows Elon Musk very well. Elon Musk is the chap who invented and owns Tesla Motors. These are incredibly efficient cars, they are very fast cars—they are actually very sexy cars—and they are fantastic cars. I was talking to this gentleman about the fact that the Government talks about electric vehicles and drives these diesels, and I said half-jokingly but half-seriously: “You know what? The Crown fleet should be Teslas.” And this chap said: “Well, I reckon that if the Crown went to Elon Musk and said that it wanted to replace its fleet with a fleet of electric Teslas, Elon Musk would be up for it.” He said: “I can’t speak on behalf of him, but imagine picking up global dignitaries at the airport in a Tesla—in fully electric vehicles.”

David Bennett: How much do they cost?

STUART NASH: Mr Bennett, that is leading by example—that is leading by example. Bringing a piece of legislation to the House is all very well, and I like the intent behind it, but the Government has a very important role to play in driving innovation in the sector. I do not know what the future is going to look like in this, but what I do know is that change is happening very quickly. What I also know is that the world of electricity is going to look incredibly different in 10 years’ time to how it does now. We need to be on top of this. So I think I would stand up and applaud the Minister if he had given that speech and he drove around—he could say “I drive an electric vehicle.”, but he cannot. He stands up and gives a speech about the importance of electric vehicles, yet he does not drive one. He stands up and says it is important that the Government is in charge of innovation, and yet it does not innovate.

The Government fleet, according to the Parliamentary Library, is around about 17,000 vehicles, give or take a few. Imagine if the Government had a policy where it said it was going to have an opt-out policy, as opposed to an opt-in policy, around every car in the Government fleet being electric. Let us make an assumption that there are 15,000 Crown cars in the fleet that have the potential to be electric. Let us also make an assumption that they are on three by 1-year leases, which is your stock standard corporate Government lease. Let us make one more assumption that they have a life span of around about 5 years after their 3 years of Government lease. If the Government led by example in this area, there could be 40,000 electric vehicles on our roads simply through Government behaviour—simply through the Government doing the right thing—and yet it does not, or it will not.

That is why I find it quite rich that the Minister of Energy and Resources can stand up here and talk about what those members are going to do with electric vehicles, and yet they do not use them. That is a real shame. I think they actually should. I think the Government should be really driving innovation—pardon the pun—in this sector. This plays into, actually, our global brand. We go out there with this “clean, green” image, and yet Sir Paul Callaghan himself once said: “We believe that we have a clean economy and a clean green image, and do not see the lack of honesty which surrounds this branding. We are merely a small population spread over a large area which provides an impression of clean and green.”

David Bennett: Like your fire truck.

STUART NASH: This is where the Government needs to play a role. This is where the Government can make a difference, Mr Bennett, and yet, it will not. Having said that, this legislation is a step in the right direction—a small one when it could take a giant one—but it is a small step. When the Minister, again, talks about what the Government is doing and the way it is innovating, I just go back to the facts. There is something called the World Energy Council. It is a highly renowned body, and the Minister often quotes the World Energy Council. It has something called the Energy Trilemma Index. Over the last 3 years, in terms of energy equity—that is, basically, the affordability of electricity for the whole population—we have dropped from 18th in the world to 28th. In terms of environmental sustainability, we have dropped from 36th to 42nd. We are not doing what is necessary to play into our global brand, which is, in essence, our global competitive advantage. It is why people overseas buy Fonterra milk and Fonterra cheese as opposed to milk and cheese from other countries around the world. The image that goes with our brand is worth—well, in 2005, the then Ministry for Economic Development valued our brand at $20 billion a year, and that was over 10 years ago.

The one thing that this Government has not done enough of is work incredibly hard to enhance that brand to play into our globally competitive advantage, but that is why we are supporting this bill, because it is a start—it is a start. I mean, if we can allow electric vehicles to drive down bus lanes, well, so be it. There are a thousand electric vehicles; there should be ten thousand. The Minister talked about Norway. Every taxi in Norway is a Tesla. This is the sort of stuff that the Government should really be doing to drive innovation in the sector. When I read that the bill is designed to expand the mandate of the Energy Efficiency and Conservation Authority (EECA), I have no problem with that, because I think EECA has done a pretty good job so far in looking at ways to drive energy efficiency, but what cannot happen is for EECA to become too diverse or too wide in its mandate but not be given the resources to do a really good job.

My personal view is that EECA dropped the ball when it did not provide a submission on the Government’s proposed transmission pricing methodology. Let me tell you one area where innovation really is driven in an era that has great concerns about the change this Government is making. It is called the Independent Electricity Generators Association. This association represents about 40 small businesses that own electricity-generation plants connected to the local distribution network. This brings diversity to local sources of energy. It drives innovation, and yet this sector is very concerned about the changes that the Government is bringing into the sector. But this is a sector where innovation occurs, and this is a sector we actually need to be providing a level of regulatory support for, not undermining it in a way that could, in effect, stifle innovation. There is no doubt that this is a very innovative sector and there is no doubt that, in some areas, we drive where we are at the top of our game. In terms of electricity generation, we are second behind Norway. We do very well there. We could do better.

In transportation, though—and I have no doubt my colleague Dr Megan Woods will talk about this. About 54 percent of our greenhouse gases come from our transport sector. Anything that will drive innovation in that space is welcomed. There is no doubt about that. But I will just go back to my final point, which I would like to have as the takeaway: the Government should be leading by example in this. This legislation is a case of “Do as I say; don’t do as I do.” The Minister would gain significant credibility not only with the Opposition but also with the general public, whom he is trying to convince, if he started driving a Crown car that was fully electric. That is a Government leading by example. Thank you very much.

MELISSA LEE (National): I thank the member Stuart Nash, who just took a seat, for his support of this bill to the select committee. But I have to say that I find it rather ironic to actually get a lecture from the Opposition, which cannot even do simple arithmetic on a policy that it announced over the weekend. Having said that, I have to say that Mr Stuart Nash is probably better at maths than Phil Twyford is.

It is a pleasure to take a call on the Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill, introduced by the Hon Simon Bridges today. This bill is an omnibus bill, and it amends the Electricity Industry Act 2010, the Energy (Fuels, Levies, and References) Act 1989, the Land Transport Act 1998, and the Road User Charges Act 2012. This bill also implements the Government’s electric vehicle programme (EVP). This is a comprehensive plan to ensure that New Zealand is able to meet its international commitments regarding climate change and that we can work to improve energy conservation and effectiveness in our transport sector. Positive gains can be made across New Zealand through the implementation of the EVP, and through this legislation, we can work together for the best opportunities on offer for the next generation.

Innovation in energy use and better transport productivity are important for us. Better energy use means lower costs and overall better outcomes for Kiwi families. This can be achieved by measures that will support greater accessibility—accessibility to renewable energy resources—and reduce New Zealand’s greenhouse gas emissions. Although New Zealand should be very proud that we have a very high renewable energy source, we can do more and become world leaders. Our legislation should be fit for purpose and support the future development of New Zealand’s changing transport and energy environment.

As the Minister outlined, there are four measures in the bill, which will be considered by the select committee. The first is that the bill will change how the Energy Efficiency and Conservation Authority (EECA) is funded. Under EECA’s current funding model, almost half of its total funding is recovered from the electricity efficiency levy and can be spent only on electricity efficiency activities like the television ads. This bill will enable the cost of EECA’s activities to be spread across a wider range and include the levies from transport fuels and gases alongside electricity. That would actually mean that we probably could do a lot more with the increase in the amount of money that we collect. It means that it probably will give more flexibility to EECA—how it can actually use its funds to support the promotion of things like low emission vehicles, contestable funds.

The second part of it is to allow electric vehicles to access the special vehicle lanes, for example. This amendment will clarify that road-controlling authorities may use their by-law-making powers to create special access lanes in situations where they may wish to support a non-financial incentive such as other countries have actually used to increase the uptake of electric cars and other vehicles in their authority areas. I believe that the Minister mentioned Norway as well as California in his speech.

The third measure is to allow exemptions to road-user charges as a stronger financial incentive for things like electric vehicle uptake, where heavy duty vehicles such as electric trucks and buses would be exempted from such road-user charges for the benefit of increasing their numbers among the wider transport fleet until they actually reach about 2 percent of the heavy vehicle stock in New Zealand.

The fourth and final main measure is that there needs to be clarification on how electricity industry regulation will apply to the secondary network—for example, for people who generate their own power, using batteries or using the sun, and they could actually feed into the electricity network. This legislation may, in fact, support the growth of further innovation from consumers instead of just from the electricity generators.

I believe that this bill is good for New Zealand, and I look forward to the submissions process and the discussions that the select committee will have. It is a good bill, and I commend it to the House.

SUE MORONEY (Labour): The Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill is the Government’s attempt to make it look as if it is doing something significant about addressing carbon emissions in this country, but of course the New Zealand public is not fooled by that. It does not matter how many times Simon Bridges goes and has a photo opportunity with an electric vehicle; no one is going to be impressed by his tiny target of having just 2 percent of the vehicle fleet being electric by 2021.

Brett Hudson: That’s not the target.

SUE MORONEY: That is his target. His colleagues do not even realise how tiny his target is. He wants to have only 2 percent of the vehicle fleet being electric vehicles—

Brett Hudson: It’s 100 percent wrong.

SUE MORONEY: It is not 100 percent wrong. It is 2 percent by 2021—that is what his tiny target is. It is 64,000 vehicles. That, Mr Hudson, represents 2 percent of the entire fleet—by 2021. So it is underwhelming. In order to bring about this underwhelming target by 2021, it is underpinned by this underwhelming piece of legislation. It is a tiny target.

I recall that back in 2008, when I was debating—and am still debating, actually—in Hamilton the idea of getting a commuter train service between Hamilton and Auckland.

David Bennett: Diesel.

SUE MORONEY: That is right—diesel. Diesel—because it is better than having 200 petrol cars on the road. It is much better for the environment than that.

David Bennett: Oh, you petrolhead!

SUE MORONEY: David Bennett cannot do that maths, but it is. So when we were debating this, David Bennett said in 2008 that that would be a waste of time because in 10 years’ time everyone was going to be driving an electric car—in 10 years’ time from 2008! Well, hang on. Let me do the maths. That would be 2018. David Bennett, National MP, said that by 2018 everyone would be driving an electric vehicle. How underwhelmed and disappointed David Bennett must be with his own Minister of Transport’s announcement that not everyone would be driving an electric motor vehicle by 2018. Not only that, but he wanted only 2 percent—2 percent—of drivers to be driving an electric vehicle by 2021. So I think the National Government has outdone itself. It used to be—what did it used to say—ambitious for New Zealand. I think it has completely given that away, and, now, just 2 percent will do.

Here is the piece of legislation that is going to bring about that tiny target. I agree with Stuart Nash, because what all the evidence and research say is that the thing that is going to really drive the purchase and procurement of electric vehicles by New Zealanders is the purchase price coming down substantially. That is the one thing that will make it really attractive for New Zealanders to do better than have 2 percent of the vehicle fleet being electric by 2021. What is one of the things that the Government could do? What is the best thing the Government could do to bring the purchase price of electric vehicles down? The best thing the Government members could do is to ensure that all of the Government vehicles, all of the Government fleets, as they are replaced, are replaced by electric vehicles. Will they do that? No. They have said: “Oh, we’ll think about it. Oh, we’ll look at a procurement policy.” But have they said: “As a Government, we will lead the way and we will ensure that as our large fleet of Government vehicles gets replaced, they will be replaced with electric vehicles.”? No. They would not even go that far. It is no wonder Simon Bridges will commit only to the tiny target of 2 percent by 2021.

As Stuart Nash said, 40 percent of the carbon emissions in this country come from the transport sector. So that tiny target—2 percent of 40 percent—is barely going to make the difference that we need to make in terms of reducing carbon emissions in this country. The one thing that the Government could do that would make a difference, it has failed to do. Instead, it is tinkering around the edges of things that we know actually do not bring about a big cultural change.

In this bill what it is doing is it is going to allow electric vehicles into bus lanes. How clever is that! Bus lanes set aside for public transport are now going to be cluttered up with cars. How is that going to help? How is that going to reduce carbon emissions? How is that going to ensure that New Zealanders go out and buy electric vehicles? Well, it is just not. We know that it is the purchase price coming down that will allow New Zealanders to go out and buy those vehicles, not any of these silly rules that are actually designed to congest the bus lanes, because that is what is going to happen next. The bus lanes are going to get congested and we know that in Auckland that is a problem already. We know that those bus lanes are already congested with buses. They are full up with buses. Now this Government wants to clog them up further with cars. It wants cars to go and use the bus lanes. It is just nuts.

It also has gone down this route of reducing road-user charges for the heavy electric vehicles. However, the regulatory impact statement tells us that that is already a failed policy. It is already a failed policy. The Government has already put this in place for light electric vehicles. Light electric vehicles are exempt from road-user charges until 2020. Has that made a difference? Has that meant that people have rushed out and bought light electric vehicles? No, it has not. What makes the Government think that this is the magic bullet that is going to address this for buses and trucks when its own advice that it has had is that it does not make any difference?

What the regulatory impact statement says is that electric vehicles currently make up a small proportion of the light and heavy vehicle fleet. In fact, they make up only 0.03 percent of the light vehicle fleet as at 31 January this year. The number of heavy electric vehicles in New Zealand at the moment is 60—six-zero of them are currently in New Zealand. However, what the regulatory impact statement points out is that even though the light electric vehicles have been exempt from road-user charges already, that has not made a blind bit of difference in terms of the uptake of them.

This is because—and I am going to say it again—we know that the thing that drives the uptake of electric vehicles is bringing the purchase price down and, sadly, neither of those two measures attempts to do that. What the Government has done is it has reduced the cost for light electric vehicles, with the road-user charge exemption of about $558 per vehicle. It has meant that there is less money available in the National Land Transport Fund to actually fund transport projects, but it does not mean that there has been any discernible increased uptake in the purchase of light electric vehicles. It has, though, under the regulatory impact statement, robbed the National Land Transport Fund of around $500,000 per year already. What we have got the Government coming to the House and proposing to do is to reduce the amount of money available for the National Land Transport Fund, which funds all of the other transport policies and all of our infrastructure, but it does not do anything to increase the number of electric vehicles that are purchased.

The one thing that will work in that area is bringing the purchase price down. The one way in which the Government can do that is to lead by example and use its huge purchasing power with the very large Government fleet—yes, I am talking ministerial cars—and, also, all the cars used by our core Government departments. This Government could have and should have said that it would use its procurement to buy electric vehicles in order to build the fleet up for second-hand car sales of electric vehicles, and, therefore, bring the purchase price down, but it has failed to do that. Instead, it has set itself a tiny target and has brought this underwhelming bill forward to underpin that.

BRETT HUDSON (National): It is a pleasure to rise in support of the Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill in this, its first reading. It comes as no surprise, after this past weekend, for us to realise that Labour and numbers just do not go together. Those members did not get them right on the weekend, and it is no wonder at all that they cannot get them right now, either. Ms Moroney does not understand the difference between a minimum and a maximum. The Government has a target of looking to stimulate the uptake of electric vehicles. It does not say: “Once you get to 2 percent, stop.” The other part of the 2 percent, of course, is that that is the threshold for when the road-user charge exemption will be removed. What the Government is looking to do is to stimulate the uptake of these vehicles, not pay for them for the rest of their lives.

The other thing the member clearly did not understand is the nature of total cost of ownership. By creating this stimulus for both heavy and previously light vehicles, the Government is helping to reduce the total cost of ownership for those early adopters—those people who choose to take advantage of this stimulus for their own reasons and purchase those electric vehicles. It is helping to drive adoption, without going to the point of just buying these vehicles for people, which is the Labour Party’s standard policy approach to most things.

But it is really odd: the member says in one breath that 2 percent is pathetically low and the Government should be criticised. In the very next sentence she says: “You’re going to clog up the bus lanes with your 2 percent, which is pathetically low.” How you square that circle is absolutely unknown to man or beast, I would argue.

The other point I would like to make, given the Labour members have said the Government should be doing this for its fleet, is wake up and smell the coffee, because back in August the Minister of Transport announced that the Government would be looking to pool the purchasing power of both the Government and the private sector to help to drive the capital cost of electric vehicles down by creating greater demand.

Secondly, let us make this clear. Mr Stuart Nash drives a Bedford TK fire engine, which spews belching emissions all over Hawke’s Bay, and he says we should be driving electric vehicles. Maybe he should try eating his own dog-food. Let us also point out that the ministerial BMW fleet that exists today was a pre-order from the previous Labour Government, and the reason it gave was low carbon emissions. Those people just cannot do anything with any consistency.

This is a good bill. It will advance measures to help meet emission controls and targets. It will actually help to drive us to be a lower-emitting country, and I commend it to the House.

JULIE ANNE GENTER (Green): I am keen to speak on this bill because it does represent an area that I am greatly passionate about. In my whole career, I have been interested in finding positive solutions to climate change, because I care deeply about the future of our people and our planet. I know that most New Zealanders share that concern and share those values. They care about the long term and they want to see the Government implementing smart solutions that are going to look after our precious natural environment and our people.

Unfortunately, this National Government is letting New Zealanders down. I think it means well. Certainly, it does demonstrate that the Greens have shown enormous leadership over the past decade or two that now every party in Parliament is talking seriously about the need to respond to climate change and is in support of clean, green transport. That is a huge win for the Green Party, which has been talking about climate change and clean electric vehicle policy the longest, I think, of any party in Parliament. But the truth is that this National Government, although it means well and has changed its rhetoric, is far more focused on the short term and on getting those PR wins that make it look like it is taking action, when fundamentally its policy is not going to create the changes that New Zealanders really need. This policy in particular falls well short of one that would actually make it easier for more New Zealand families and businesses to afford electric vehicles.

The Green Party will support the bill because these changes that it is proposing to the Energy Efficiency and Conservation Authority (EECA) levies and transport levies are quite good. That is pretty straightforward. Basically, it is allowing the levy collected from the electricity industry to be spent on other areas, like transport—so energy efficiency, not just electricity efficiency—and allowing the existing petrol and diesel levies to be used to fund EECA. I think that makes a lot of sense, because, obviously, energy conservation and efficiency are more than just electricity, particularly with New Zealand’s profile, where about half of our climate pollution from energy comes from transport, not from electricity.

Of course, we need a strategy to ensure that we have a greater percentage of renewable electricity in New Zealand—that is something National is failing to deliver, unfortunately—and we need a smarter approach to transport. If the Government were really serious and really enthusiastic about electric vehicles, then it would implement policy that would actually accelerate the uptake of electric vehicles in New Zealand. But we know that its strategy is not going to do that. The very targets that it has adopted are actually lower than what Ministry of Transport officials forecast would happen without any policy assistance.

So although Simon Bridges, the Minister of Transport, is quite keen to be seen in every photo op with a new piece of electric vehicle charging infrastructure, the reality is that this Government has done nothing to incentivise or financially support the installation of that charging infrastructure. That is something that one could have reasonably expected it to do if it wanted to have more electric vehicles in New Zealand. That is what countries like Norway, which has succeeded in massively increasing the number of electric vehicles on the road, have done: they had Government support for electric charging infrastructure across the country. That would be the Green Party’s policy.

The next part of the policy that is incredibly short-sighted, and was actually very much discouraged by the officials, is the policy of allowing electric vehicles to use bus lanes and public transport lanes. If you want really efficient transport—transport that not only is energy efficient but also is going to move more people and goods in crowded urban areas—the smartest way to do that is to build a fast, modern public transport network and use rail to get goods to and from the port, not to put more trucks on Auckland’s already overcrowded roads.

Amazingly, that type of infrastructure is far more cost effective and entirely affordable, and yet the National Government has not been properly investing in it, even though it is going to give us the greatest bang for buck in terms of our next dollar spent in transport. In terms not just of reducing pollution but of actually making it easier for people to get to work and get to school and for those goods to get to and from the port, the best way to do that is to put more of our capital investment into our rail network and to protect those busways that we have already built. The Northern Busway is now moving as many people as all of the lanes on the Auckland Harbour Bridge at peak time. Why would we make that less efficient by allowing a few people in electric vehicles to use it?

I guarantee that that is not going to be the incentive that makes it easier for households to afford an electric vehicle. Ultimately it is going to be the well-off people who have the money—who are able to spend $60,000 on a new electric vehicle—who are going to benefit from being able to use the bus lane, and it is actually going to make it harder for 50 people on the bus to get to work. Does that seem fair? Does that seem efficient? No. It is a terrible idea, and that is why Norway, which actually had this policy, is phasing it out. It disrupts the provision of efficient public transport services, which can move many times more people. A busway can move 10,000 people an hour. A railway can move 20,000 people an hour. This is why electric vehicles cannot compete with public transport for moving people in busy, crowded urban areas like Auckland.

I have news for the National Government. I have been campaigning on the North Shore rail project on the North Shore. We have been surveying people of the North Shore. There is virtually 100 percent support for that project. That is what people want—and I would say half or more of the people whom we talked to voted for the National Party. So it is time to get with the programme and deliver what people actually want, what is actually going to work and be more cost effective.

Finally, the road-user charge exemptions for electric vehicles are not the most effective way of delivering affordable electric vehicles for businesses or households. Even Treasury said that in its advice to the Minister. We have, under the Official Information Act, advice from Treasury saying it does not make sense to spend this money exempting the road-user charges. We need those road-user charges to pay for the transport network. I mean, if you are going to have many more people using electric vehicles then it is going to create a whole lot of congestion. How are we going to invest in the capital infrastructure that is going to deal with that, if we are not charging for the use of the road? That does not really make much sense. What would make sense is using the money to reduce the purchase price of electric vehicles, and actually making it more affordable for people to buy the electric vehicle in the first place.

That is why the Green Party has a comprehensive electric vehicle policy, which will work. Unsurprisingly, since we were the first party that was really campaigning seriously on climate change and coming up with the solutions, we have the most practical policy. It is very simple: (1) Government invests in infrastructure that is going to move more people and goods; (2) Government invests in infrastructure, like electric charge infrastructure, and supports private business to do that, but coordinates both the public and private installation of that infrastructure to ensure that there is a network that people can use; and (3) Government procurement—I know my colleagues in the Labour Party have been talking about this, and it is incredibly important from a leadership perspective.

The Government is spending huge sums of money on vehicles, both for Cabinet Ministers and across the whole of Government, whether it is for district health boards or whether it is for Corrections, there are all sorts of Government vehicles. Where possible, we should be prioritising the purchase of electric vehicles and clean vehicles. It is better for New Zealand. It is better for the long term. It makes sense, and if we are going to spend the money, we might as well do it in a way that is going to look after the environment.

Finally, the Green Party looked at the policies that have been effective around the world at increasing the uptake of electric vehicles. In Norway they had a huge tax on vehicles—all of their new cars were subject to this big tax. They exempted electric vehicles from the tax, and now one out of four new vehicles being sold in Norway is electric. By 2025, one will not be allowed to purchase a diesel or petrol vehicle; it will only be electric. It has been incredibly effective, and it was that—reducing the purchase price of electric vehicles—that worked.

We do not have a big tax on vehicles here in New Zealand, but we do have the fringe benefit tax. In fact, 80 percent of the new vehicles that are brought into this country are company cars. So we said: “Why don’t we have an exemption for fringe benefit tax on electric vehicles for 7 years?”. It would really give that incentive to businesses to buy electric vehicles. They would save money on the operating costs as well. Giving that possibility of dropping the cost will make it much more attractive to buy an electric vehicle, and within 3 to 5 years we will have developed a second-hand electric vehicle market, so ordinary households in New Zealand can buy an electric vehicle.

FLETCHER TABUTEAU (NZ First): Thank you for the opportunity to speak on this Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill. Can I just say—and I know it is being a bit trite—but I can just imagine Mr Bridges in consultation with his ministry staff as they came into the office and told him: “Sir, we are going to call it ‘Energy Innovation’.” You can just imagine his excitement. You know, “Oh, that’s excellent! That’s fantastic!”—he would say—“It sends a message to New Zealanders about how innovative the Government really is. It does, doesn’t it? It sends a message, right? We’re more innovative than all the rest combined. Is there any way”—he would say—“that we can take an innovative photo to go with that?”. Here we are. It is not that innovative, and I think, unfortunately, the Minister of Transport has let the people of New Zealand down with this legislation. Although, to be fair, unlike much of the legislation that New Zealand First has opposed in the past—where the intent sounds wonderful, but, actually, the opposite effect would take hold—at least with this legislation I can, with some pleasure, stand up on behalf of New Zealand First and say that, actually, the intent is there. Once we have read the legislation and got feedback from industry, it might make a tiny, little bit of difference, and it will not actually do the damage that other pieces of legislation that this National Government has put through the House have. Here I am with great pleasure—

Jono Naylor: How gracious of you!

FLETCHER TABUTEAU: —great pleasure, Mr Naylor—saying that New Zealand First will support this piece of legislation through its first reading.

Jono Naylor: Finally.

FLETCHER TABUTEAU: That is another debate, but anyway—that is another debate. To be fair, this is taking some tiny baby steps in the right direction. We think we will support it all the way through. It is important to note that there was previously an engagement with industry and there was not much that was negative, but I will highlight what the feedback was because I think that the Minister needs to take that on board in terms of how to move forward with the support of business and industry, and not just the support of the energy sector. I will bring that up in a moment.

I think we have a bill designed to encourage the take-up of electric vehicles, if we listen to the Minister and those on the other side of the House. Can I say to the Minister that this bill will be as significant and as helpful as the 2 percent threshold placed on the heavy vehicle fleet. For example, when I first started reading the legislation, I was actually quite excited by the prospect of the road user charges exemption being moved up to the heavy vehicle fleet. I thought, as inefficient as it is—as noted by a previous speaker—it is something meaningful and tangible that industry could get its teeth into and move forward. Then you read further on, and—credit to the Minister, he said it himself—“Actually, we’ll only give it to 2 percent of the fleet.” When you do the numbers, given last year’s figures, there are several hundred thousand in that heavy vehicle fleet already, and so this would then apply to fewer than 3,000 heavy vehicle units on the road. From an everyday New Zealander’s perspective, I do not think that that—in their mind—would be a tangible take-up, or make any kind of significant difference. I would like to add to that that it is not the most efficient use of funding. I think that what you want to do is put some money down to actually encourage the uptake of commercial vehicles by private users. So it was disappointing, to say the least.

What I wanted to touch on were the broader issues. The Minister said—and I will find a quote here; here it is: “The transport and industrial sectors are areas where the most impact can be made on improving New Zealand’s energy productivity and reducing emissions.” What I would like to point out to the Minister is that he has, kind of, completely overlooked the area of transport where most gains could be made. I speak specifically about light rail, the electrification of the New Zealand rail network—and this is a Minister who has overseen the rail network being de-electrified. He said how important it is—he is quoted publicly as saying how important it is—to our commitments to Paris, and yet this is a Minister who has overseen the de-electrification of the rail network. Not only that, he has seen the closing down of sections of rail, and then—what do you know—a year or two later, the Government has decided that, despite its predisposed opposition to rail for some unknown reason, it would have to open up that link again because it was the most efficient way of moving goods on our national infrastructure.

The bill is quite narrow in focus, but, as I have said, I acknowledge today that National is taking baby steps in the right direction—although the business sector has already moved out in front of it quite significantly, so it is already behind the eight ball there and it needs to step up to the mark. It is probably the opportune time to point out that perhaps the Minister himself could at least make his limo an electric vehicle. That might send some signals, and it might be the start of a practical solution to the problem that the National Government has acknowledged that this country has.

We need the legislation, but, as I intimated earlier, what we had in engagement with industry slightly before this legislation came to the House was feedback from a significant number of those who were spoken to, who came back and said: “What you’re doing right now is expanding the Energy Efficiency and Conservation Authority’s (EECA’s) mandate. You’re giving them more money, and you’re taking it from different pools, but you haven’t told us how they are going to use those funds.” For example, this legislation broadens EECA’s mandate quite significantly, and in so doing there will now be a combined energy levy. It is going to consult and report annually, and I think, when you consider the background of the National Government over there, consulting and reporting annually is a huge, huge step forward in terms of transparency and accountability for the National Government—so we are halfway there.

What the industry wanted was a logical link to show how that money was being taken from it, and how it was being used for it. That is fair enough. They are not saying they need a plan—that we need a definitive plan. I think several members in the House have acknowledged the industry is innovative, and they want to move forward themselves. But they want some reassurance. They want what they coined as “rationality”. I think they have every reason to be concerned, and the Minister needs to take that into account. The legislation, bearing in mind this was a consultation document, has not done so in this first draft of the bill. So that is something for the Minister to consider. The Minister has much to consider. There is basically no time to delay. New Zealand does need to act, and we need to act quickly, which is why these mini steps are important. They will not do the opposite to what the intent says they will, so we will be supporting the bill at its first reading.

But the Minister described this bill as enabling great initiatives that empower and encourage the take-up of e-vehicles, such as non-financial options like allowing e-vehicles to use the bus lanes. This bill does not actually do that. We are going to need another Minister to enable that. Actually, by not mandating that centrally they are giving councils the right to make that decision. And there is another whole debating point for the House to consider, about whether central government is brave enough to say: “Let’s do it, or let’s not. Let’s not fob it off to councils.”

I would like to point out to the Minister for Tertiary Education, Skills and Employment and the Minister of Education that in doing some analysis for this bill we realised, when engaging with industry, that there are no—or so significantly few—electric vehicle mechanics right now in New Zealand that an uptake of any magnitude would not be taken up well by the industry itself. I put it as a question to the Minister, and to those Ministers: “Does the industry need help in terms of training and upskilling young New Zealand workers to cope with this?”. To conclude, this bill is a start. It could even be described as a good start, which is why New Zealand First will support it today. It does not make it any easier to buy an electric vehicle. It does not make access to charging stations any easier across the country. But for the National Party it is something slightly more than nothing. Thank you.

SIMON O’CONNOR (National—Tāmaki): I am very pleased to take a call on the Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill. I just have to take a little bit of umbrage with the previous speaker’s metaphors—talking about baby steps. I need to remind him that this is actually about cars and vehicles. You do not step in a car, unless you are a Flintstone, which might be representative of a party past. He also talked about being behind the eight ball. Again, it is very hard to be behind the eight ball on a road, because normally the eight ball is on a pool table, which is just to our left here.

Already we are seeing the Opposition being somewhat confused. We have also seen a whole lot of confusion, particularly from those members of the Labour Party who are great supporters of diesel trains and diesel-belching fire engines. They have been standing and standing and moralising, if you will, to a degree, around these important steps. I will come back to that in a moment.

This is an omnibus bill. It is in four parts, as the Minister has indicated. I am not going to go through all or each of them. One of them is ultimately around what the Energy Efficiency and Conservation Authority can do. At the moment you will be familiar with the ads on TV around how one conserves electricity. This bill basically allows it to extend. The other areas are around the use—as has been mentioned, mockingly unfortunately, many times—of bus lanes. I just encourage members to come to my electorate, to the likes of Tāmaki Drive, to find the T2 lanes and what the bus lanes are used for. They are not actually packed full. Maybe that works in the land that Labour and the Greens inhabit, but in reality they are not overly used and, actually, it would be a welcome opportunity, I would argue, for taxis and other vehicles to use them as well. These recommendations are very positive.

I just return to my initial theme around the moralising, particularly around the point that the Government should go out and buy 17,000 electric vehicles from Elon Musk. Firstly, as a negotiator in the past, I can say that you never tell the people you are going to buy from that you want to. It is a very quick way to get a very inflated price. I am just going to throw that out there—not that corporate experience is the strong point on the other side. But the other element too is that actually they will be the first parties to complain that we did not spend the extra millions of dollars that we spent on electric vehicles on the homeless and housing, on social welfare, and on education and the like.

The good news, of course, is that we are very prudent in the way we spend money on the vehicles in the ministerial and ministry fleets, and, really importantly too, we are already spending an enormous amount of money in the social services space. I know that the Minister who has recently announced $300 million for emergency housing is in the House. It is just tremendous. So cars, housing, you name it—I am going to end it there.

Mr DEPUTY SPEAKER: A 5-minute call on behalf of the Green Party—James Shaw.

JAMES SHAW (Co-Leader—Green): I rise to take a call on the Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill. I just want to start by talking about how excited the Government of course is about this announcement. It has been a long time coming, this piece of legislation. It was first announced on 5 May, and it was then announced again on 10 June, and then again on 12 August, and then again on 24 August, and then again on 31 August, and then again on 9 September, and then again, 3 days later, on 12 September, and then again on 14 September. This bill has been announced no fewer than eight times since 5 May, so it is great to see a piece of legislation that actually backs up the eight announcements of this policy in the last 6 months.

The Government having announced this bill eight times, of course, I need to draw attention to the Treasury advice, which is that it “will not be effective”. In particular, I am talking about the part of the legislation that relates to electric vehicles. I will come back to that in a minute.

First, I just want to say why it is important that we encourage the mass take-up of electric vehicles in New Zealand—that we really pull out the stops on this. First of all, transport makes up 20 percent of all of New Zealand’s greenhouse gas emissions, and 90 percent of transport emissions come from ground vehicle transport. So if we were able to click our fingers and switch all of New Zealand’s ground vehicle transport to electrics, then you would see an enormous decrease in our greenhouse gas emissions. On that front alone, it is very important that we encourage the mass take-up of electric vehicles.

The other thing, of course, is that it would do wonders for our balance of payments deficit. Our balance of payments deficit at the moment is running at just over somewhere between $7 billion and $8 billion, and we import about $6 billion worth of petrol and diesel into New Zealand—petroleum for our ground vehicle transport. The mass take-up of electric vehicles would virtually close our balance of payments deficit.

However, the legislation, as it has been supplied to us so far, will not do this. As Treasury says, it will not actually be effective in encouraging the mass take-up of electric vehicles, cutting pollution, and reducing our balance of payments deficit.

The single most significant policy that the Government could adopt in order to encourage the mass take-up of electric vehicles, is to remove fringe benefit tax from electric corporate fleet vehicles. Something like 80 to 90 percent of all new vehicles sold in New Zealand are corporate fleet vehicles, and they typically remain part of the fleet for about 3 to 5 years before becoming part of the second-hand market, which is, of course, where the vast majority of New Zealanders get their vehicles from. The research that the Green Party did at the end of last year and at the beginning of this year showed that around the world, in those countries that have got really significant take-up of electric vehicles—most notably Norway, but also others—removing fringe benefit tax was the single most significant thing that you could do. It would drop the upfront price of the vehicles by somewhere between 20 and 30 percent, which would put them on a par with combustion engine vehicles.

Companies want this. I mean, this policy was actually suggested by Business New Zealand, which, you would think, would be a natural ally of the National Party on this policy. So we think, and we are hoping, that in the select committee stage we can encourage the Government to change the bill in order to adopt this one measure that will actually do what the Government wants the bill to do, which is to encourage the mass take-up of electric vehicles.

I do have to reference this absurd notion saying that electric vehicles using bus lanes will somehow convert everybody in the country to go out and spend twice as much money on an electric vehicle as they currently spend on a combustion engine vehicle. It is going to increase congestion, but it is not going to encourage the mass take-up of electric vehicles. What it means is that people who have got a significant amount of money and can afford an electric vehicle will get a fast ride down the bus lane, and everybody else—the vast majority of people, who cannot afford one of these vehicles—will be stuck in congestion in the regular lanes. It is an absurd policy, and the only people whom it is going to encourage to buy electric vehicles are extremely well-off people who, frankly, if they want one, can buy one already. It is a ridiculous policy, which is presumably why Treasury said it will not be effective.

In conclusion, we are supporting this bill to select committee. We will be looking to make improvements to the electric vehicles clauses and the microgrids regulatory clauses, but, in the meantime, we support this bill.

DAVID SEYMOUR (Leader—ACT): I rise on behalf of the ACT Party to cautiously support this Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill in its first reading. I say “cautiously” because much of the bill seems to rest on a contradiction: that on the one hand, new technologies and electric vehicles are very, very good—but not good enough that people will use them without being prodded by the Government. The fact of the matter is that if we want a neutral treatment of different technologies so that consumers can choose—based on what is most efficient for their particular purposes, weighing up all of the costs and benefits using information about their preferences, known only to them—then we already offer a very significant subsidy to people adopting electric vehicles. That is just the very simple fact that electric vehicles do not use petrol and, therefore, are not subject to the major form of revenue, or the major tax, that the New Zealand Government puts on people driving.

So, acknowledging that, the bill actually seeks to further extend this subsidy to a class of vehicles that would, by happenstance, be exempt from that particular subsidy—and that is the heavy electric vehicle class, up to the point where they get to 2 percent. I have to concur with my colleague James Shaw’s comment in which he said that the use of high-occupancy and public transit lanes by electric vehicles is not a suitable inducement for people to buy electric vehicles. This is not because it will not be as effective—as James Shaw claimed—but simply because, to the extent that it is effective, it will be ruining the purpose of high-occupancy transit lanes, which is to increase the number of people who travel on a given section of road. So, all of a sudden, you have people purchasing electric vehicles to access a benefit that was actually designed to deliver a completely different policy outcome—which was increasing the capacity of a particular length of road.

This is a sort of omnibus bill, and the fourth section is much more interesting. I think that the various initiatives to increase the uptake of electric vehicles are, frankly, dubious at best. I have not mentioned the Energy Efficiency and Conservation Authority’s extension of funding to try to promote people to pick up electric vehicles, but it does seem ironic that the Government has various initiatives under way to suppress consumers finding information about nicotine and sugar and alcohol and all sorts of other things that they like to buy, and yet when we find something that is truly good, the Government has to spend money in order that people find out about that particular product. It is a very cynical view of New Zealand citizens: that we have to stop them finding out about things we do not want them to know about and then, when really good things come along, they need us to take their money and spend a million dollars a year encouraging them to find out about electric vehicles. As if there were really people—I asked the Minister of Transport about this in the House a few months ago, and he said he could not tell whether there were people out there who did not know electric vehicles were more efficient but none the less he is prepared to spend a million dollars on it.

The secondary network section, applying the same regulation as we apply to electricity distributors to secondary networks—private networks of electricity distribution that might take place in an apartment building or an industrial complex, and so on—is something that I think we really have to watch for the submissions that will come forward at the select committee stage. In principle, we have to acknowledge that there is enormous innovation going on in the electricity transmission, distribution, and retail space—absolutely enormous innovation. People are setting up peer-to-peer networks, selling and storing electricity with solar panels and batteries, and so on. However, the devil with these things is always in the detail, and it will be interesting to see what the select committee has to say or what it hears about the practical effects of bringing secondary networks into the traditional distribution regulatory scheme.

So it is an interesting bill, one that has tried to, I guess, pick winners and pick a particularly trendy technology to promote over others while distorting the regulatory framework. I think that is very regrettable, but on the strength of the secondary networks aspect I will be happy to see what people say at the select committee on this bill. Thank you.

KANWALJIT SINGH BAKSHI (National): Thank you, Mr Assistant Speaker, for giving me the opportunity to speak on the Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill at its first reading. Many, many viewpoints have been discussed in the past hour or so as we debate this bill. But I think it is a great bill, and it will encourage further—

David Seymour: Tell us why.

KANWALJIT SINGH BAKSHI: —I am telling you; just listen to it—innovation in the energy sector. As we know, and as the previous speaker, David Seymour, just mentioned, there is a lot of innovation happening in the sector, and new batteries are being built that can store a lot of energy. If we look at the capacity of electric vehicles, earlier it was very difficult for them to last a whole day, but today the technology available means that new electric vehicles can be driven for up to 500 or 600 kilometres in a day without needing to be charged. That means that the technology is coming, and this bill will help to encourage that innovation to continue.

National is committed to finding ways to reduce greenhouse emissions, and this bill is another step towards that. New and emerging technologies offer scope for us to improve the efficiency of our energy usage, which offers economy-wide benefits while also complementing efforts to meet our international commitments to global efforts to manage climate change.

One thing I would also like to mention is that the majority of the energy being used right now in transport is not renewable, but by having vehicles that are battery operated or electricity operated, we can use renewable energy. That will help us to reduce greenhouse emissions, and it will also enhance our commitment as a signatory to various treaties around the world.

I look forward to the select committee process when the bill comes to the Commerce Committee, and I hope that we will have good input from the stakeholders. That will help us to enhance the bill. With these words, I commend this bill to the House.

CLARE CURRAN (Labour—Dunedin South): I sit on the Commerce Committee, where this bill will come, and I am looking forward to the discussions at the select committee on this, but when I first saw the title of this bill and thought “Ah, what’s this about?”, I felt a frisson of excitement that—

Richard Prosser: A croissant—a breakfast of excitement.

CLARE CURRAN: No, not a croissant—a frisson. Ha, ha! I felt a little bit excited that there was a plan—there was a plan—and that Simon Bridges was finally going to come good. He was going to come good. He talks a big game sometimes and he gets very excited—electric vehicles are probably one of the things that he gets most excited about. I think James Shaw mentioned how many times he had announced this—not exactly this bill, but he made the same announcement eight times, because, I think, it was just so exciting. I thought that we were finally going to have a bit of a plan around energy innovation and that the Government is taking this seriously, that it is starting to practise what it preaches around curbing emissions and looking at how the energy sector and the transport sector can actually seriously contribute to that.

So I have been looking through and I cannot find the plan, but maybe when the bill gets to the select committee—because it is essentially a series of small piecemeal measures that, when they all add up, do not add up to a plan. It is going to be interesting when we get to the select committee as to what policy initiatives lay behind them. That is, I think, certainly what I will be asking at the select committee.

It reminds me of—every time Labour talks about its Future of Work project, which has just been announced at the weekend—a 2-year project, with nearly half of the Labour caucus involved. It is a very serious joined-up piece of work looking at a major issue. In the next 10 to 15 years, 45 percent of jobs that exist now in New Zealand are unlikely to exist. It reminds me of what Simon Bridges does every time the Future of Work gets some traction: he leaps up and starts talking about driverless pizza delivery cars—that that is somehow something to do with the Future of Work.

We make the point that we want New Zealanders to be having the ideas and designing the inventions behind new technology and new ideas in New Zealand, and not be the receivers of pizza through driverless cars—our Future of Work project is about the people who make those pizzas.

It feels to me very much as if there is a “small beer” approach being taken by the Government on all of these sorts of issues, and it is very much lip-service. You can imagine Simon Bridges speaking about this at Cabinet and saying: “Oh look, let’s give it a grand name like energy innovation and make it sound as though it is something much bigger than it actually is.” Well, there is no plan, and that is very disappointing. So that is the first point I want to make.

The second point is, essentially, that listening to my colleague Sue Moroney talk about the tiny targets of Simon Bridges, and also listening to the Greens talk, particularly Julie Anne Genter, about some of the energy innovation to do with transport that is coming out of Norway—and that is just one example—made me go and actually have a look. I have not had much time to do this, but, actually, if you want to talk about a plan for energy innovation related to transport, how about this? Norway is working on a whole series of projects, and I will give you the names of some of them: Nordic Sustainable Intelligent Truck Hub, Nordic Comparison on the Future of Road Freight Energy Efficiency and CO2 Emissions, Alcohol (Spirits) and Ethers as Marine Fuel, Nordic Sustainable Logistics Network, Sustainable Transport through Improved Actor Interfaces, Cleaner City Freight Transport, Nordic Incentives for Electric Cars—I think that is where the point that she was making was, and that is just one project; there is a lot of work happening in Norway on that—Electrifying the Seaways, Mapping Electric Fuel Stations, Testing the Driving Range of Electrical Vehicles, and a project called Nordic Electric Avenue.

That sounds like a plan to me. That sounds like a major plan where not only has there been a lot of research that has gone into the different parts of the economy that are impacted but it is about how Norway is using this kind of research and these kinds of innovative projects to build its own IP—that is intellectual property, for anyone on the Government side who maybe does not know what I am talking about—that it can then offer to the rest of the world and add value to the rest of the world when it comes to carbon dioxide emissions. But instead we have got this little piecemeal piece of legislation coming before us that takes a few measures and puts them in a framework that it calls energy innovation.

Well, I am putting the Government on notice: when this legislation gets to the select committee, we will be asking questions about what analysis has been done on what value this will add to our economy, what the carbon dioxide emissions are that will result from this, how this is being measured back to New Zealand’s commitment through the Paris Agreement, and where it fits in with a wider plan in New Zealand around reducing our emissions and what we have signed up to in terms of that.

Instead, we have got just a few small things: making changes to the levy funding for the Energy Efficiency and Conservation Authority (EECA)—I am not diminishing these things, but they are not exactly major strategies around energy innovation—and clarifying how electricity industry legislation applies to secondary networks. If you read the regulatory impact statement, that seems to be its major focus as to what the impact will be on secondary networks and how the legislation needs to take care around that. I am not diminishing the importance of that. We have got to get things right in legislation and we have got to do things the right way, but it does not sound very groundbreaking or earth-shattering when you are thinking where this is going to fit in a wider energy innovation plan.

Of course there is also creating new road-user charge exemptions, enabling electric vehicles to be exempted from road-user charges in the same way that light electric vehicles are, proposing that EECA is able to access funding through the Petroleum or Engine Fuel Monitoring Levy and the gas levy, and again going back to clarifying the application to secondary networks.

I am disappointed. I think the Green members are certainly disappointed, and I am hoping that they will make a major contribution at the select committee as to how we could be doing it better. I hope that that gets through to the New Zealand public, because it is, quite frankly, embarrassing to be standing in the House this afternoon, talking about a bill that is titled Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill when those “Other Matters” could actually be a plan that New Zealand could use to hold its head up high, show what an innovative nation it is, and actually use this piece of legislation to drive our economy, develop intellectual property and new inventions, and create new jobs. Instead it is all a bit pathetic. We support this bill, but it is a major disappointment.

ALFRED NGARO (National): I rise to take, I think, the final call on this bill, the Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill. Clare Curran has made a speech. I was a little bit sort of confused because the analogy that I heard was a croissant of excitement, which ended up in a disappointment.

Clare Curran: Frisson.

ALFRED NGARO: A “crisson”—a “crisson”, a croissant; it sort of sounded very similar—and then it went on to pizzas. I am not sure how they connect with electricity, but I do know that croissants are cooked in an oven, so that is electric, but pizzas—the best sort of pizza is cooked in a wood-fired oven, so I am not sure how that connects with electricity.

Look, some of the comments that were made by the member were quite interesting. She said that there is not a plan, and maybe if the members just talked about the bill in itself, then one could come to that conclusion. But if they look at what has actually been happening previously—I want to draw the member’s attention to some of the plans. The first thing you would do in a plan is you would have a feasibility study and you would engage with the sector. We know that on 31 August that is exactly what happened. Minister Joyce, along with Minister Bridges, announced the procurement changes to drive electric vehicle uptake. So that whole change was in consultation.

There was a feasibility study that was done, so the member might like to read that, because that has been part of what you would call formulating a plan. That was the consultation. There was what they call an all-of-Government panel, which was in discussion to talk about, in the procurement changes, how we could make it more affordable. Mr James Shaw talked about the fleet leasing of vehicles, which makes up about 70 percent of our new vehicles in New Zealand—what we could do in that regard.

So I would just like to let the member Clare Curran know that those are some—she is about to go, but just before she goes there are a few other things that she may want to be made aware of. We had the electric vehicles contestable fund. That was a way of engaging into the community to be able to talk about the importance of how this fund could be used in a way to, again, promote the key messages around electric vehicles—how they can be beneficial to communities and to consumers. Those things were important. There were 14 areas that were engaged on in the area. There was Electric Vehicle Day, when there was a campaign that was constructed to ensure that more of this information was out there.

I know the previous speaker, Clare Curran, talked about the lack of a plan. There was consultation with the sector, there was a feasibility plan, and there was engagement with regard to rolling out the key information to ensure that the community realises the benefits from electric vehicles. That has been carried out. There is a contestable fund of over a million dollars to ensure that we can have this part of that process ongoing, as well. This bill is only one part. It ensures that there is an exemption that will allow for electric vehicles—it also means there is an opportunity to use the lanes that we know are set aside for bus lanes. There are opportunities there.

I would say it is not about a lack of a plan. In fact, I think it is well-thought-out. I think it is putting it forward.

The previous speaker and the Labour Party are talking about Labour’s release on the focus on work, I think it is called, and yet in this Government we are just getting on and doing things that make the difference. For instance, in emergency housing, there is $300 million and 1,400 places available right throughout the country—600 in Auckland and 800 throughout the rest of New Zealand. Those are the sorts of things that this Government is about.

This Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill is about scoping more of that. We look forward to the submissions that will come forward from the sector.

We are glad to hear that right across the House people are supportive of this bill. We will support it going to the Commerce Committee. We have got a great chair, who will take us through hearing these submissions. We look forward to returning this bill and the report to the House. I commend this bill to the House.

Bill read a first time.

Bill referred to the Commerce Committee.

Third Readings

Third Readings

Hon JUDITH COLLINS (Minister of Corrections): I move, That the Bail (Drug and Alcohol Testing) Amendment Bill, the Parole (Drug and Alcohol Testing) Amendment Bill, the Sentencing (Drug and Alcohol Testing) Amendment Bill, the Public Safety (Public Protection Orders) (Drug and Alcohol Testing) Amendment Bill, and the Returning Offenders (Management and Information) (Drug and Alcohol Testing) Amendment Bill be now read a third time. This Government recognises the harm that drug and alcohol misuse can have on the community. Drug and alcohol use is a major driver of crime. Too many people are using substances at the time of their offending, and too many offenders on community-based sentences and orders suffer from addiction issues. To discourage this, courts may impose a condition of bail, sentence, or order to not use drugs and/or alcohol. The Parole Board may also specify that abstinence is a condition of release from prison or an extended supervision order. The enforcement of drug and alcohol conditions plays an important role in protecting public safety by ensuring that offenders and bailees can be held to account. However, under the current legislation there is no clear authority for police or Corrections to test people with abstinence conditions for the presence of drugs or alcohol.

This legislation addresses this gap by empowering Corrections and police to test people who are subject to drug and alcohol - abstinence conditions as part of their sentence or order. This will benefit the person being tested by deterring them from harmful substance abuse. It will also protect public safety by ensuring that agencies can hold people to account when they do breach their conditions.

During the Committee of the whole House, I tabled a Supplementary Order Paper that extended the testing regime to include returning offenders and provided for agencies to use an automated notification system to notify offenders of testing and clarified that an offender or defendant could be notified of their requirement to submit to testing via telephone or other electronic means. The Supplementary Order Paper also made minor technical changes to the legislation. I wish to thank members of the House for their cooperation in supporting this Supplementary Order Paper to ensure the legislation is fit for purpose and to ensure that the returning offenders regime is kept consistent with any changes made to the parole regime.

The legislation allows the Chief Executive of the Department of Corrections and the Commissioner of Police to make rules related to testing methods and procedures. The rules must adhere to three broad principles that uphold the rights of people being tested. They must prescribe procedures that are no more intrusive than necessary, ensure testing only occurs as often as necessary, and afford as much privacy and dignity as practicable.

The testing regime is expected to target the highest-risk people who are subject to abstinence orders and who pose a serious risk to public safety if they consume alcohol and drugs. The targeted approach aligns with international best practice that suggests that frequent testing of the highest-risk group is the most efficient means of detecting and deterring the use of drugs and alcohol. The Government recognises that we must do more than just hold offenders to account, and we must address the underlying causes of criminal behaviour and break the cycle of offending.

In accordance with the Government manifesto commitment, Corrections has successfully obtained $8.6 million over 3 years to develop and deliver a tiered approach to drug and alcohol aftercare support. Corrections has also secured $2.1 million from the proceeds of crime fund to develop and trial targeted methamphetamine screening and treatment in prisons. These programmes will enable us to support offenders in prison and in the community to leave substance abuse behind and lead crime-free lives. This adds to the existing range of treatment options available, which are very substantial and actually making a difference, but we can do better, which is why this legislation is here.

To sum up, and in conclusion, this Government has committed to holding people to account, but also to breaking the cycle of offending, which is actually much more difficult than just holding people to account. This legislation will make an important contribution to these goals, and will strengthen our ability to keep the public safe. And I would like to just put on the record, again, my thanks to the House for its support for this legislation. I commend the legislation to the House.

KELVIN DAVIS (Labour—Te Tai Tokerau): Labour supports this legislation, the composite parts of the Drug and Alcohol Testing of Community-based Offenders, Bailees, and Other Persons Legislation Bill. As the Minister of Corrections said, for this third reading the legislation is divided into the Bail (Drug and Alcohol Testing) Amendment Bill, the Parole (Drug and Alcohol Testing) Amendment Bill, the Sentencing (Drug and Alcohol Testing) Amendment Bill, the Public Safety (Public Protection Orders) (Drug and Alcohol Testing) Amendment Bill, and the Returning Offenders (Management and Information) (Drug and Alcohol Testing) Amendment Bill. The Returning Offenders (Management and Information) (Drug and Alcohol Testing) Amendment Bill, as the Minister said, was put in the legislation by Supplementary Order Paper 236 to make sure that when those people who have been detained or convicted of crimes overseas return here, they are under the same testing regime as people who have been released on bail into the community or people who have been sentenced into the community or people who are on parole after having spent time in prison or those people who are the subject of public protection orders—in other words, people who have committed serious sexual or violent crimes.

As we know, drug and alcohol misuse is a driver of crime. The number of people who have reported using drugs and alcohol at the time of their arrest is approximately 48 percent. Two-thirds of offenders on home detention, intensive supervision, and supervision orders have identified alcohol or drug abuse or other addiction issues, so it makes sense that we put in place a regime that monitors those people who have got an abstinence condition and make sure that they actually follow it.

Most offenders are not intrinsically motivated. They do not think to themselves: “Oh, crikey! I better not drink alcohol. I better not participate in consuming drugs.” Many of them are extrinsically motivated, meaning that they need external pressure put on them to make sure that they abstain from drugs and alcohol. That is why these conditions are put in place—to actually help them and to help the community to be safer. To me, it is a win-win situation. The offenders are helped, albeit extrinsically, to abstain from drugs and alcohol. Their families would probably be really grateful if they were kept off drugs and alcohol, so that they do not offend and so that they do not go back to prison, but, certainly, communities will be safer as well. So it is a win-win situation for the offender, for their families, and for the community. Some people may see it as an imposition on the offenders, but the reality is that we need to look after our communities and make sure that they are kept safe.

Every year there are thousands of offenders on community sentences and orders, and bailees who have an abstinence condition imposed. This legislation allows, as the Minister has said, the Commissioner of Police and the Chief Executive of the Department of Corrections to have their people test these offenders. If offenders know that they have got a high chance of being checked for drugs and alcohol, then the chances are that they will be more inclined to not take the risk of consuming both drugs and alcohol. On the flip side, if they believe that they have a high chance of being caught with drugs and alcohol in their system and that there will be consequences because of this, then the chances are that they will be less inclined to consume drugs or alcohol.

We can draw a comparison with our poor burglary resolution rates. Burglars know that they have a 90 percent chance of getting away scot-free if they commit burglaries, so there is a high probability that because of that they will go on to commit further burglaries.

We also need to have a look at what is going on in prisons. Yesterday I met with a couple of former prisoners—female prisoners who had, obviously, spent time in a female prison, in South Auckland. They made a startling claim that at any given time there were no more than a dozen or so prisoners who were able to attend drug and alcohol rehabilitation programmes. They also said—and I have heard this from other prisoners as well—that the reason prisoners attend the drug and alcohol programmes is that prisoners from other units will come together in one room and it is easier, basically, for them to exchange drugs and alcohol. They said that somebody who attends the drug and alcohol programme has to be a particularly motivated and determined person to actually break the habit, because of the fact that they really attend the drug and alcohol courses to actually exchange drugs. They also said that there was another place where they go to exchange drugs, and, funnily enough, that is to Church in prison. They are not just talking about participating in the communion wine; they said that when prisoners come together from other units to Church, it is just another—it broadens the market, I guess, for the exchange of drugs and alcohol.

So it is good to hear that the Minister said that, over 3 years, the Government is putting $8.6 million into addressing this and $2.1 million into meth screening. There is a real need in prisons for greater support to help prisoners kick the habit. As those prisoners told me, they have to be particularly motivated and particularly determined to kick the habit because, basically, the conditions in prisons actually encourage drug and alcohol consumption. The other thing they said is that they attend the courses and then they may have to wait 1 or 2 years before they actually get released into the community. They are told: “Attend this 3- or 6-month course and then sit around for 2 years, but make sure you remember what you were told 2 or 3 years ago on that drug and alcohol course and then apply it once you get out.”

As a former educator, I know that if people are going to learn things, they actually need to be able to apply their knowledge and what they have learnt almost immediately. The courses probably need to be more intensive, more regular, and include more prisoners. Corrections has more work to do in order to create the conditions where prisoners address their drug and alcohol issues both inside and outside the community, and this is just a small—actually, it is not even a small step. It is just another step to help monitor prisoners’ consumption of drugs and alcohol.

There was a concern around the equipment that is attached to the people and that it might give false positive readings in drug and alcohol testing. I am sure—well, I would like to think—that Corrections and Police have got the equipment to such a state that it will not give false positives, because one of the problems with false positives is that it is really hard for the prisoner to actually prove that they are innocent. I gave the example in the Committee stage of how police have used Listerine with children in schools to show that alcohol breath testing can pick up Listerine or can pick up the alcohol in cologne. It is very, very hard for an offender who is actually innocent, who has a false positive, to prove and be heard and believed that they did not actually consume drugs and alcohol if the testing equipment provides a false positive. The chances are that they will end up back in prison. They will be bitter, angry, and twisted if they think they have been treated unfairly. So it is important that offenders and the public have confidence in the use of alcohol-monitoring technology and its effectiveness.

We have got to make sure that testing for alcohol or drugs does not encroach on the right to be secure against unreasonable search and seizure. The Minister did say that the testing should be no more intrusive than is necessary, that it should be no more often than is necessary, and that it respects privacy. I think we have got to balance the rights of offenders with the rights of the community to be safe. Kia ora.

Debate interrupted.

Amended Answers to Oral Questions

Question No. 10 to Minister

Hon Dr NICK SMITH (Minister for the Environment): I seek leave of the House to make a correction to an answer in question time today.

The ASSISTANT SPEAKER (Hon Trevor Mallard): Is there any objection to that? There is objection. [Interruption] I will ask the member to sit down. I just want to remind members that it is extremely unusual to deny leave to a member to make a personal explanation for the purposes of making a correction. It is the right of any member to do so, but what it does is, effectively, leave on the record incorrect statements. I will also remind members that it is a gross abuse of the correction system to use it for any political purposes. I am going to put the leave again. Members do have the right to turn it down. Is there any objection to Nick Smith making a personal explanation in order to correct an answer? There is.

Third Readings

Third Readings

Debate resumed.

KANWALJIT SINGH BAKSHI (National): Thank you, Mr Assistant Speaker, for the opportunity to speak on the final stages of the legislation arising out of the Drug and Alcohol Testing of Community-based Offenders, Bailees, and Other Persons Legislation Bill. Before I continue with my contribution, I think the member who has objected to the personal explanation should go and get testing done. The purpose of the legislation is to amend the Bail Act 2000, the Sentencing Act 2002, and the Parole Act 2002 to enable the Department of Corrections and the police to require community-based offenders and bailees who are subject to the condition of a prohibition on the use of drugs or alcohol to undergo drug and alcohol testing.

We know that drugs and alcohol are two of the biggest contributors to crime in our country. Two-thirds of prisoners have substance abuse problems and half of the crimes committed are committed by someone who is under the influence of drugs or alcohol. Also, this is often a major factor in reoffending. We need to understand that we have to give the tools to the Department of Corrections and the police, who want to ensure that our communities and our people are safe in their homes, in their businesses, and in their communities. There was a limitation with the law. The police and Corrections staff were trying to ensure that offenders and bailees complied with their drug and alcohol conditions, but they were limited in what they could do and what they could not to. That was a big problem and that is why this legislation was introduced. I think we should congratulate the Minister on her leadership. Also, I would like to thank all the members of the Law and Order Committee who contributed during the select committee process, and the officials also.

This legislation establishes a legislative basis for bailees and community-based offenders with a drug or alcohol abstinence condition imposed by the court or Parole Board to undergo alcohol or drug testing or summit to continuous monitoring if directed by police and the Department of Corrections. Here I will also clarify that the chief executives of the Department of Corrections and the Police have to publish the rules and how these rules can be implemented on a case by case basis. It is very important for us to understand that these rules are set in a way that ensures nobody is abused while they are being tested or while they are being asked to come forward for compliance.

This legislation also establishes the principle that testing should not be more intrusive than is reasonably necessary to ensure compliance with the drug and alcohol conditions. That is important because we do not want people to be abused, and we do not want bailees or prisoners in prison to be abused. This legislation is another step to ensure the safety of our communities, and I commend these bills to the House.

Hon DAVID PARKER (Labour): Thank you, Mr Assistant Speaker, and could I thank the last speaker, Kanwaljit Singh Bakshi, for his contribution. I just want to elaborate on something that the last speaker averted to. One of the submissions that was made in respect of the drug and alcohol testing of people who are on bail was made by the Law Society, which said that it ought not to be in the power of registrars to impose a drug and alcohol condition as a condition of bail if the defendant did not agree to it, and that that sort of imposition on the person who was seeking or being granted bail should be left to a judicial officer. The Law and Order Committee agreed with that and it has proposed an amendment that says that a registrar must not impose a drug or alcohol condition unless the defendant consents to that condition being imposed. That, effectively, means that if the defendant does not agree and says it is not appropriate, then it is up to a judge to make a decision as to whether it is an appropriate condition to be imposed.

I think that is a wise change. We should remember that people who are on bail have not yet been convicted of an offence. Sometimes they are innocent, and they certainly have not had their guilt proved, so they are in a slightly different situation to someone who has already been convicted and is within the justice system, and the justice system can impose more—or there is more justification for imposing these sorts of conditions against the will of the person concerned if their guilt has already been proven. So I think it is appropriate that, in respect of bail decisions, the registrar should not be able to impose a drug or alcohol condition unless the defendant consents to the condition being imposed. That does not mean to say that it will not be imposed; it does not mean to say that it should not be imposed. It does mean that sometimes it should not be imposed, and where the line is to be drawn between those who should or those who should not have those conditions is, appropriately, a decision for the judge rather than a registrar.

The other concern that the Law Society raised was that continuous monitoring obligations, in its view, amounted to a major infringement of liberty that breached the rules. It said that it seemed wrong for police and corrections officers to be writing the rules that allow themselves to blood-test people who are not even in prison—so they could be on a community-based sentence. It thought that it was wrong that the police and corrections officers were the ones who were empowered by law to write the rules about testing in the community, given that they are the ones who are going to be applying them. It thought that that duality of roles was wrong. The Minister of Corrections at the time, Sam Lotu-Iiga, said that the principles were included in the bill to guide officials in setting up the drug-testing regime, and these included a requirement that the testing could not be unreasonably intrusive or frequent, and that the person who is being monitored should be given as much privacy and dignity as possible. That is an issue that we can delve into more at the Committee stage of this bill, and if I am in the Chamber at the time I will be asking that question.

The Law Society went further and said that it did not think that any person should be required to wear an alcohol-monitoring bracelet without a judge’s approval. The legislation, as it stands, in respect of someone who has previously had a conviction, puts that decision in the hands of the police and corrections officials, and, again, we will be asking the Minister to justify why—

Kanwaljit Singh Bakshi: I raise a point of order, Mr Speaker. I think we should remind the member that this is the third reading of the legislation.

The ASSISTANT SPEAKER (Hon Trevor Mallard): Yes. That is not the member’s role. I mean, he is the least likely member to be warned for being disorderly, but, actually, it is disorderly.

Hon DAVID PARKER: No, actually, I think that that was a fair comment. I will defend the member for saying that. So—

The ASSISTANT SPEAKER (Hon Trevor Mallard): The Assistant Speaker was attempting to signal to the member, and if he was looking and not reading, it would have been easier.

Hon DAVID PARKER: Well, it was certainly a less rude gesture than if you had been indicating it was the second reading, Mr Assistant Speaker, so thank you for that. Thank you for that assistance. I accept what the member who has just made that point of order said in his contribution to this debate—that that issue had been covered off by the Law and Order Committee and that he was satisfied, and so were the other members of this House, that the concerns of the Law Society were appropriately dealt with in the protections that are found in the legislation as to principles—and I am not going to inquire about that at the Committee stage because it has already passed.

So Labour Party members are supporting these bills, because I think most people in society would agree that for some people who have alcohol and drug problems, it is necessary for both their own protection and the protection of the community that we have some forms of intervention that ensure that, as people are transitioning from a custodial sentence back into society, they are encouraged to stay drug and alcohol - free. I would note that monitoring is only part of the solution, and the Police Association said that in order for these things to be effective, you actually have to have the drug and alcohol treatment courses that are available to people who have come out of custodial sentences. Sadly, a lot of them will not have had those treatment services available to them while they were in prison, because those services are still not broadly enough available. It is also true that some people whilst in prison may not be willing participants in them but once they get out into the community might have changed their mind and recognise that they need help with their drug and alcohol addictions, and they should have services that are available to them for their own betterment and for the protection of society.

It is a sad reality that one of the reasons—and it is only one of the reasons—why we have an increasing prison population in New Zealand is that we actually have not got those services under control yet in New Zealand. We have large numbers of our prison population suffering from drug and alcohol problems, which, as my colleague Kelvin Davis has already said, is a contributing factor to their offending. He does not present it as an excuse for their offending; he just states it as a fact that it is true that the people who have drug and alcohol problems are more likely to offend and that is ameliorated if they have the ability to deal with their drug and alcohol addictions through services that are available.

Of course, it is true also that disproportionately the number of people who are in prison also have other problems. Some of them are very, very poor. Some of them have psychiatric problems as well. A lot of the people who are in need of these services to deal with their drug and alcohol problems are less able to afford to pay for them, and if they are not provided by the Government at low cost or free they will not be accessed by them. That is one of the reasons why it is important that we as taxpayers, and we in this House, support the provision of those services in the community so that the drug and alcohol problems of people who have offended can be dealt with.

I do not think I have got anything to say other than that. There are three parts to this, really: people who are on parole, people who are on bail, and people who have had community-based sentences are all affected by this legislation. So long as there are appropriate safeguards this should work OK. I think if those who have these powers overuse them and use drug and alcohol testing to an excessive degree and it becomes oppressive, then it actually will not meet its social purpose of helping people to overcome their problems. In fact, it could have the opposite effect and it could amount to a post-sentence infringement of their liberties if taken too far. I trust that the authorities will be cognisant of that and I hope that these pieces of legislation work to improve outcomes for our society. Labour supports these bills.

TODD BARCLAY (National—Clutha-Southland): It is a privilege to speak on the third readings of these particular bills. I would just like to acknowledge the speakers who have gone before me, in particular our chair, Kanwaljit Singh Bakshi, for his sterling leadership of the Law and Order Committee and his interference in the House before, as well. I have to agree with Mr Assistant Speaker that it was quite unlike him, but it was a very sage point. I would just like to acknowledge also the previous speaker, Mr Parker, on a number of the points that he was making, on reflection, regarding some of the motives and the unfortunate characteristics of many of the offenders who are currently in prison for the first time and repeat offenders as well. We heard a statistic from the Department of Corrections that about 80 percent of inmates have drug-related or alcohol-related—or both—characteristics that are a negative part of their offending.

I think the fundamental part of this legislation, or the intent behind it, is not to say if you are an offender we are going to randomly slap a drug and alcohol testing regime around you. It is for the Department of Corrections and police to have a greater ability to actually monitor those who are on bail or out on parole, with a condition around drug or alcohol use—to actually enable them to enforce that and follow up. For most offenders who are repeat offenders, as we know, they have drug- or alcohol-related incidents. Part of this is to help try to protect them—while they are in prison and undergoing drug and alcohol rehabilitation—when they exit back into society again, it is to help that continuation of that treatment. If they know that there is enforcement around drug or alcohol use as a condition of them being released out into the public, they are less likely to offend and they are less likely to utilise those substances—which, in effect, means that there is a greater chance that they are less likely to offend in a criminal space that saw them put into the corrections system in the first instance.

One of the aspects of the legislation that the select committee expanded on was the inclusion of psychoactive substances as one of those, and to test the ability for police and Corrections to test. It is quite important because a couple of years ago, before the Government put in place legislation and restrictions around the use, there was a massive blow-up of that use in our community, and there is still a flow-on effect from that. Many of the offenders have evidence of using that. So, thank you. It was a privilege to sit on the committee and listen to submissions. It is a privilege to commend this legislation to the House.

DAVID CLENDON (Green): I am pleased to continue the Greens’ support for these five bills, which have been split out of the original bill as we first saw it at the first reading.

What the bills do, of course, is provide a mechanism whereby people who are at large within a community but are under some form of monitoring or some form of supervision can be measured for compliance with conditions—usually around banning any use of controlled drugs, psychoactive substances, or alcohol. We see that as a useful thing. We had some initial concerns. We initially undertook to support the legislation only to the select committee on the basis that there were some potential fishhooks in the legislation as it was initially drafted, but we are quite satisfied with the progress of the select committee, which was a good committee actually. There were some useful and thoughtful submissions and some conversations there, and I think it has delivered these bills in pretty good shape now.

I think one of the things that we relied on in the legislation is that it establishes three principles with which any undertakings in this legislation must be consistent. They are that testing should be no more intrusive than is reasonably necessary, that testing should take place no more often than is reasonably necessary, and that those liable to testing and monitoring should be treated respectfully, with dignity, and with as much privacy as possible. Those are pretty sound principles and I think the credibility of this legislation will depend to some extent on those who implement it respecting those principles and not using this legislation as a means to harass individuals or to make their lives unnecessarily difficult or complicated. I have no reason to think police or indeed corrections staff would do that, but I would hope that the people responsible for implementing these bills will keep those key principles at the top of their mind as they do their work around them.

There was some concern about some elements of this legislation, but we see value in it in part because of the degree to which it aligns with conditions that apply to those being held in custody. Clearly, inmates in prisons or under other forms of custody are subject to testing of alcohol or drugs or whatever it might be, and we thought that having those same compliance conditions in the community was not a particularly onerous imposition on people. The upside of that, of course, is that it gives judges another option, or indeed Parole Board members, who are making a call about whether a person should be given bail or not or whether a person should get parole or not. Knowing that these conditions are in place to ensure compliance or to monitor compliance with very necessary drug and alcohol conditions could make it more possible or more likely that people will be released into the community. We see that typically as a good thing, because the more time people spend in prison, the more likely they are to offend. So the sooner we get them into community care, the better.

There is also the factor, of course, that people who are in the community but subject to these conditions—it makes them less prone to what we might call peer pressure. They can present a solid argument if they are under some sort of pressure from acquaintances or friends or whatever to “Go on. Just have a beer or have a toke.”, or whatever it is. This will give them a very sound reason to say: “No, I cannot, because tomorrow I might get the knock on the door.” I think that is quite a valuable addition to our suite of tools to try to manage people in the community.

There is one point where I think the legislation could have been improved. Currently the chief executive officer of Corrections has an obligation to make rules prescribing the nature of monitoring, what sort of testing might take place, the levels of particular substances in a person’s blood or breath, or whatever it is, which would trigger some sort of breach, and various other rules that the chief executive officer of Corrections can make—specifically, I imagine, for people who are serving community sentences or who are on parole. The Commissioner of Police has similar powers also—where people are on bail, particularly—to set rules about the nature of the testing, the frequency, and the levels at which penalties or some breach might kick in.

I think we missed an opportunity when there was a Supplementary Order Paper before the House at the Committee stage that would have obliged the chief executive of Corrections and the Commissioner of Police to talk to one another. I think we can assume in the current conditions that they will talk to one another. They are both reasonable and sensible men, but I do think that it would have been helpful to have something embedded in the legislation—simply a line to say there is an obligation for them to consult with one another. It would be unfortunate if we ended up with one regime for people on bail and a different regime for those on parole. It just seemed that it would have added some value to put that small addition to the bill, but so be it. We simply have to rely on their common sense to make sure that the two regimes do align fairly closely because it would make no sense at all if they did not, particularly, I think, in terms of the levels that constitute a breach. If a person on bail is treated differently than somebody on parole, then that to me would create some tension and it would make no sense at all.

The only other points I think I would make is that these bills do provide some useful mechanisms, some tools, but, ultimately, they are a defensive measure, and Mr Parker in his contribution made a point along those lines. There was a very good submission to the Law and Order Committee from the Community Action Youth and Drugs (CAYAD), which is a national programme focusing on young people, obviously, and it was concerned about drug and alcohol use and abuse in the community. It, sort of, scoped out the range of issues around how it is one thing to monitor, to test, or to coerce people into not using drugs or alcohol, when obviously they have an ill-effect on them and their behaviour, but it is another thing again to provide support mechanisms and treatment programmes. The CAYAD submission was one of several that commented along these lines that monitoring, forcing, or measuring compliance is one thing, but we need to be actively providing means by which people can break their addiction to drugs or their dependence on alcohol or other forms of substance abuse.

It is a sad reality that at the moment we are seriously under-resourced in terms of alcohol and drug treatment in the community. I think you would struggle to find a treatment provider anywhere in New Zealand that did not have a waiting list. I understand that currently there is something like a 3-month delay in people getting treatment for methamphetamine addiction, in Auckland at least, and I suspect around the country it is similar. That is simply unacceptable, and it is plain stupid—if I may use that very simple word—to have a major drug and alcohol problem in this country, yet we are not resourcing the treatment that can serve to break the cycle of addiction, that can break the dependencies, and in the long term change people’s behaviours.

Although these are useful bills and they provide a useful addition to the tool kit, if you like, for managing people and hopefully managing them back into being useful, contributing citizens who move away from offending, I think that we cannot rely on defensive measures alone. We have to be proactive. We have to get real about resourcing the long-term solutions, which are very much about treatments and about providing the facilities that people do want and need in order to break their dependence in the cases where people do get hooked on drugs or whatever it might be and their behaviours are modified so seriously and in often violent ways. So, with those few comments, again, I just simply say that we do support this legislation and we look forward to its thoughtful and principled implementation.

MAHESH BINDRA (NZ First): It is a pleasure to rise on behalf of New Zealand First to speak to the legislation arising from the Drug and Alcohol Testing of Community-based Offenders, Bailees, and Other Persons Legislation Bill. We have supported the bill through its earliest stages and we supported it because we liked the intent of this bill. The intent of this legislation is to hold those offenders and bailees who are in the communities to account. Those bailees and offenders, and those on parole—earlier, before this legislation was thought of—used to get away with continuing their offending habits and continuing their addiction to drugs and alcohol. This legislation seeks to remedy that situation.

Those on bail and other offenders in the community—in the absence of such good and potentially effective legislation—got away with recidivism. So we like this legislation, although it has some anomalies, which are yet to be answered. We did have some questions, which were not answered. However, the overall intent of the legislation is good, and that is to keep our communities safer. This legislation will go a long way in addressing the reoffending habits of offenders in the community.

Having been trained as a drug-testing officer some years ago, I have a fair bit of an idea how the drug-testing regime works inside the wire, inside prison. It is not perfect, but it is fairly effective. I have seen thousands of prisoners going out and coming back through our prisons’ revolving doors.

About the drug-testing regime within the prisons—those tests are carried out within the close confines of the prison, but, still, some prisoners are able to manipulate the results. They are able to falsify the samples. That percentage is not very high, luckily, but there are a few prisoners who have managed to falsify their drug results and the Department of Corrections has no means to stop that, unless the officers who collect the samples are very alert and they comply with the rules that have been set down for those tests.

Also connected to the drug-testing system are the drug-treatment units that are being run by the department, and I would like to congratulate the Department of Corrections on being very effective at addressing the drug addiction of prisoners within the wire. This legislation will now bring the offenders who are on parole, on bail, or on temporary release in line with the prisoners who are in the custody of the Department of Corrections. So they will be as responsible for addressing their offending and their drug and alcohol use as the prisoners inside the walls of the prison. I think it will be a situation where the prisoners, whether they are in prison, in custody, or outside in the community, will be responsible for their behaviour.

Other than that, the other issue that we had was about the modalities of how this drug-testing regime is going to work. We were told that the bailees will be administered by the police, and those on parole or on temporary release will be managed, as it is, by the Department of Corrections. So it will be up to the Commissioner of Police to formulate the rules for the police, and the Chief Executive of the Department of Corrections will be responsible for laying down the rules for the department.

Our fear was what happens if they do not coordinate with each other. For that purpose, I had to fix that anomaly. I lodged Supplementary Order Paper (SOP) 163 proposing that it becomes mandatory for the police commissioner and the chief executive of Corrections to talk to each other and to consult each other while formulating the rules for their respective areas of work. However, I think only the Greens saw the wisdom in supporting that SOP, and I thank them for that.

The Minister thought that it was not necessary for such an SOP to be supported by the Government. She reckons that Corrections and Police do talk to each other, so it is not necessary for this legislation to make it mandatory for them to talk. If that is the case, our question is what happened when Phillip John Smith escaped the country? What happened when Tony Robertson raped and killed Blessie Gotingco? In both these cases the two departments did not know what the other was doing. It took them about 48 hours to talk about the escape by Phillip John Smith.

To fix that situation the SOP was put through, but it was not supported by the Government. The Minister went to the extent of implying that the Chief Executive of the Department of Corrections and the Commissioner of Police share information and work very well with each other, and therefore there is no such need for an SOP like that.

Although we support the legislation, given the intent behind it, we have some questions that are yet unanswered. Those questions, again, are about how it is going to work, about the modalities of the drug-testing regime. We want to make sure that the offenders who are on parole are kept in line with the bailees, so that there is no unfairness in administering this legislation. Overall it is good legislation and we support it.

JONATHAN YOUNG (National—New Plymouth): I am very pleased to stand and speak in support of this legislation, five bills divided from the Drug and Alcohol Testing of Community-based Offenders, Bailees, and Other Persons Legislation Bill. I think the people of New Zealand would be pleased to hear that there is agreement across the House for such a good piece of legislation, which has some very positive outcomes for everybody involved in this.

For instance, for those people who are community-based offenders or bailees who do have an addiction, either to drugs or to alcohol, they have some supported remedy to that. It might seem to be the strong arm of the law, but many people who are caught in those addictions need that level of support, and the legislation is quite clear that that work by Corrections and police needs to be done in a reasonable manner.

Secondly, the people who are most affected by bailees and community-based offenders who are under the influence of drugs and alcohol are often their families. We see an effect on domestic violence in this country that is driven by alcohol and drugs. If this legislation can bring greater protection to families because there is greater accountability to the conditions of bail or community-based sentences, that is a very good thing.

Thirdly, there is the general public, as well. The general public deserves to be protected. This is what law and order is about. We have a very good Minister of Corrections in the Hon Judith Collins, who believes very strongly that New Zealanders must be protected from crime. This legislation serves them.

Fourthly, it also gives our police and corrections staff a greater degree of understanding and clear authority around this particular area. At the moment, police and corrections staff are trying to ensure offenders and bailees comply with drug and alcohol conditions, but they are limited in what they can do. This legislation will give them clear authority.

The bills create a legislative mandate for alcohol and drug testing of eligible offenders and bailees. In my final thoughts, New Zealanders want to see the law in New Zealand upheld. We really do. We want our law to be respected and we hate it when the law is flouted, because law creates safety for everybody. The degree of accountability in a positive way, in a responsible way, and in a reasonable way through this legislation will help do that. Thank you.

The ASSISTANT SPEAKER (Lindsay Tisch): The next call is a split call. Julie Anne Genter—5 minutes.

JULIE ANNE GENTER (Green): I want to pick up where that last member, Jonathan Coleman, left off in saying that New Zealanders want the law to be upheld and respected. I completely agree with that. I also think New Zealanders want to live in a society where everyone has a fair go and where everyone suffering from various challenges—whether it be alcohol or drug addiction, or other challenges in their personal and professional lives—is looked after in the community, because that is the way to ensure that we have a happier, healthier, safer country for everyone to live in.

Addiction is not just a personal, individual problem; it is a social and environmental problem, in many ways. Drug and alcohol abuse obviously affects people beyond the people who are suffering from the addiction, so this legislation will, hopefully, enable more help and support to be given to those community-based offenders and bailees who are struggling with addiction and will enable them to turn their lives around. That is why the Green Party is supporting this legislation.

I think it is particularly important, as my colleague David Clendon mentioned earlier in this debate, that the three principles established by this legislation are upheld in the implementation—that is, that testing should be no more intrusive than is reasonably necessary to ensure compliance with a drug or alcohol condition, that testing should take place no more often than is reasonably necessary to ensure compliance with a drug or alcohol condition, and that those liable to testing and monitoring should be given as much privacy and dignity and respect as is possible. I think those are incredibly, vitally important principles in this legislation, because if those principles are not respected in the implementation of the legislation, then there is the risk that this sort of testing could be used to harass people in the community or to infringe on their civil liberties. I think it is really important that we protect that, and that we recognise that it is not just about identifying that people have relapsed and that they are still partaking in drugs or alcohol when they have been released back into the community but about providing the wraparound support of the health system to ensure that people are able to overcome their addictions.

It is really interesting. The latest research on addiction actually suggests that people are far more susceptible to it if they are living in conditions that are not great, and so it is not surprising that some people who are homeless suffer from high levels of addiction. You could say: “Well, that’s the reason that they are homeless—because they suffer from the addiction.”, but, actually, if you provide people with homes, it is much easier to treat them and for them to overcome their addiction. So it is really important that we embrace this paradigm shift in how we approach alcohol and drug addiction and crime, and recognise that all of these problems are interrelated and that we are not going to get anywhere by blaming individuals and trying to take a punitive approach to discourage them from engaging in behaviour that really is not necessarily of their choice.

We have to take a social and environmental approach to public policy, which would reduce the harm for all people in Aotearoa and is simply more effective, and so I am happy that this legislation is going in that direction. It is not just about testing and punishing people who are suffering from drug and alcohol addiction but actually—hopefully—about providing the wraparound support that they need so that they can overcome their addiction and, in fact, live happier, healthier lives, in which they are not offending and are not interfering with the ability of other New Zealanders to live happy and healthy lives. That is, ultimately, what we all want. Certainly, what the Green Party wants for Aotearoa is a happier, healthier society with less crime, less inequality, and less addiction to things like drugs and alcohol. Thank you.

The ASSISTANT SPEAKER (Lindsay Tisch): Peeni Henare, tēnā koe—5 minutes.

PEENI HENARE (Labour—Tāmaki Makaurau): Tēnā koe, Mr Assistant Speaker. Thank you for this opportunity. I rise to take a 5-minute call on behalf of the Labour Party and express its support in the third reading of this particular legislation. Interestingly enough, as I was sitting there listening to the debate—and we know that the bills have come all the way through the processes of this particular House; we are now at the third reading—you always think of extra questions that, perhaps, you should have asked throughout the entire process. I was wondering how—if we are sending those who are released from prison back into homes that are contaminated with P—that affects their chances of staying sober, and of not being tested and found positive for having traces of P in their system.

One year ago the media reported that a 10-year-old child was found to have P in their system, simply by living in a P-contaminated house. This time last year, according to the reports—the numbers released under the Official Information Act—it was estimated that there were approximately 600 State homes, managed by Housing New Zealand, that were contaminated with P. I wonder, given some of the testing regimes and some of the questions asked about some of the testing regimes to discover whether or not your house is contaminated with P, whether or not that will have an impact somewhere along the line when testing comes around for those who are released into homes under supervision—some strict rules around drug use and, of course, alcohol. This House has already expressed how these types of provisions ensure that communities are safer.

I wonder whether the Government remembers its 2009 Tackling Methamphetamine: an Action Plan. In that action plan it talks about how intensive the counselling is that is required to break somebody from the habit of P, in particular, but also from alcoholism. I wonder whether those support services have been increased, to make sure that those who are susceptible to using drugs and abusing them—and, of course, alcohol as well—will get the support services that they require; or are we simply setting them up to fail? We are putting them back into communities where, arguably, the use of drugs such as P is on the increase. We know that in parts of South Auckland that liquor stores are more convenient than McDonald’s—and we wonder then whether we are setting them up to fail. We know that this is a step in the right direction, but we need to take a very broad view of this particular issue—a very broad view of this particular issue. We are in support of this. I referred to the Tackling Methamphetamine: an Action Plan from 2009—but it is 2016 now. A lot of years have passed by, and I am wondering, exactly, whether or not we have met some of the challenges with drugs in our communities.

As to the purposes of this particular legislation, we know that this is a step in the right direction. Communities must be kept safe, where possible and at all times, and we want to make sure that the legislation in this House will certainly lend itself towards that safety in the community. I cannot help but think about the lack of services that are out there to make sure that we are actually dealing with these issues and making sure that those who are released from prison do get the services, especially when the Government’s Tackling Methamphetamine: an Action Plan report in 2009 acknowledged just how hard it is to provide the counselling and the services that those people require. In the third reading, we support these bills. Kia ora.

IAN McKELVIE (National—Rangitīkei): It gives me pleasure to take a brief call on this legislation, which pretty much has the unanimous support of the House, and I think that is pretty encouraging. Every little incremental gain that we can make in rehabilitating our prisoners or people convicted of various crimes is a significant gain. I think it is really positive that we can move in that direction as a House, and I think it is positive that as a community we can accept that this is good for what goes on in our community. I would make the point that the New Zealand Trotting Cup is on right now. These bills do not preclude prisoners from having a small wager—and I wish I knew what the result was.

These bills do move into a complicated and difficult area for Corrections, that of rehabilitation, as has been pointed out by many speakers before me. The issues of drugs and alcohol are significant contributors to many of our offenders’ problems that they face. The ability of Corrections and the police to be able to drug test and manage the process of reintegration into our society for these people who have committed various crimes is a great move forward, in my view. The authority that this legislation provides will only apply when being drug- and alcohol-free is a condition of bail, home detention, or other community-based sentences, and will help ensure that these conditions are met.

I have been pleased to see the support for this legislation across the House during my time in the Law and Order Committee. I have followed with interest the challenges of reintegrating prisoners. I think, as I said earlier, any little gain we can get in that area is significant. I am pretty confident that this legislation will make a little bit of difference. If it makes a difference to only two or three people over the course of a year then we have had a major gain, when you think of the cost to society and also to those families, in terms of not being able to move themselves out of the net of crime. I have got a great deal of pleasure in supporting this legislation as it proceeds to become law today. Thank you.

Su’a WILLIAM SIO (Labour—Māngere): My colleague Kelvin Davis has already indicated to the House our position regarding these bills—the Returning Offenders (Management and Information) (Drug and Alcohol Testing) Amendment Bill, the Public Safety (Public Protection Orders) (Drug and Alcohol Testing) Amendment Bill, the Sentencing (Drug and Alcohol Testing) Amendment Bill, the Parole (Drug and Alcohol Testing) Amendment Bill, the Bail (Drug and Alcohol Testing) Amendment Bill, and the Drug and Alcohol Testing of Community-based Offenders, Bailees, and Other Persons Legislation Bill. I do not resile from the position that Kelvin Davis has put forward.

I do want to start my remarks by referencing what Jonathan Young said earlier in his contribution. When he said—I think it was an appeal and I am paraphrasing what he said—that all of our communities need to live by the law, I do not think that there is anyone in this House who disagrees with that. I have to then say that what Peeni Henare said was something that this House needs to consider when we are laying down legislation with the intention of preventing people from recidivism. The reality is that we are giving new powers to the police and to the Department of Corrections to be able to impose bail conditions on drugs and alcohol upon offenders who have been released.

Here is my concern: alcohol is freely available—alcohol is freely available throughout our country. In some communities, such as mine, despite efforts of the community to say “No more outlets.”, the rules that govern outlets and the sale of alcohol—rules that were passed by this Government—prevent the community from stopping new alcohol outlets in our community. There is a dilemma here. On the one hand, we are saying that we do not want released offenders to continue with the alcohol consumption and the drug consumption, but on the other hand, we make these things so readily available out on the streets and in the community. That is almost saying to a bull: “Here’s the red flag; don’t run after it.” We have got to look more broadly than simply saying that this is going to address recidivism. Yes, I note that the report says that these bail conditions are very effective in the United States, but then you have got to consider the type of society that the United States is. I have seen people on the streets of Los Angeles walking backwards and walking all over. When you ask somebody “What’s that person doing?”, they say that they are on some kind of drug.

I think that if we are genuinely sincere about offenders who are released and on parole conditions, then we have got to also have some thought about ensuring that these things that we are wanting to prevent these parolees from accessing are not so readily available in the community. At least we have been able to define the controlled drugs. But I think there is a debate that we still have to have about ensuring that these released prisoners do not end up returning to prison because of their inability to control their desires towards alcohol and drugs.

There is a woman who is in prison at the moment. Her name is Vicki Letele. She was imprisoned in March of this year for fraud. She is serving a 3½ year term. My colleague Louisa Wall has been engaging with the Department of Corrections and with the Parole Board to implore that group to release this woman so that she can be with her family. This woman, Vicki Letele, has been diagnosed with a terminal disease, cancer of the stomach. I raise this issue because we are giving the Parole Board some significant powers to make decisions on when it can search these parolees. I am saying that I think we have got to be very, very careful with the kinds of unfettered powers that we give to some sectors of our public service.

With Vicki Letele, I would have thought it was just plain simple. A woman is in her twilight hours. She is dying. Her dying wish is to be with her children and to be surrounded by her family. Corrections and the Parole Board say that she should remain in prison because that is where she can get medical care, in the hospital prison. The family says that she is dying. Is it not better to save taxpayers’ money and release her, and have her spend time with her family and with her children? I just think it is bizarre, and I am imploring the Minister of Corrections, the Prime Minister, and members of Cabinet, given that we are discussing these powers—they have the power to release this woman if they so want it. I am imploring the Minister of Corrections and the Prime Minister to do so. These are the dying days of Vicki Letele, and surely she deserves to be released so that she can spend her dying days and hours with her children and with her family.

Our politicians, our Ministers—

The ASSISTANT SPEAKER (Lindsay Tisch): This is not in the bill.

Su’a WILLIAM SIO: —have the ability to listen to and to observe what is happening on the ground. I sometimes think that the Parole Board does not have its eyes and ears close to the ground. That is the concern that I raise today. It was a concern that was also discussed by the Law and Order Committee. I note in the report that it says that “the drug and alcohol testing proposed by the bill may engage the right, under section 21 of the Bill of Rights of Act 1990 to be secure against unreasonable search or seizure.” and that the committee “considered that, because the drug and alcohol testing had implications for human rights, drugs, and alcohol conditions for bailees might be more appropriately imposed by a judicial officer, rather than a registrar.”

I raise the point that we are giving these significant powers to certain parts of our Public Service, and the experience that we have had is that they are often disconnected from the realities of what is happening in the community. Again, I want to put it on the record that tonight, this week, the Minister of Corrections, the Prime Minister, and Ministers in Cabinet can do a good thing. They can do the right thing, and support what my colleague Louisa Wall is asking the Department of Corrections and the Parole Board to do. But I say they should just simply release Vicki Letele and have her spend her dying days and hours with her children. That is the right thing to do. It is a good thing to do.

JOANNE HAYES (National): I stand to take the final call on this legislation. It is very good legislation. There has been a lot of discussion across the House in support of it. I too support it and commend it to the House. Thank you.

Bills read a third time.

Bills

Trans-Pacific Partnership Agreement Amendment Bill

In Committee

PEENI HENARE (Labour—Tāmaki Makaurau): I seek leave for all provisions of the bill to be taken as one debate with separate votes on each question at the end of the debate.

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

Parts 1 to 12, schedules 1 to 4, and clauses 1 and 2

GRANT ROBERTSON (Labour—Wellington Central): I raise a point of order, Mr Chairperson. I raise this point of order now, so that there is perhaps some time while the debate goes on, and over the dinner break, for a considered ruling from you. I am raising this point of order under Speakers’ ruling 130/2 around the issue of commencement dates. Speakers’ ruling 130/2 says: “An amendment to a commencement date must provide certainty about when the Act is to come into force. An amendment that relies on an indeterminate event is not in order.” The amendment that has been made to clause 2(2) of the bill—the commencement date—says: “That date must be the date on which the Trans-Pacific Partnership Agreement, done at Auckland on 4 February 2016, enters into force for New Zealand.” As is well known, and perhaps dependent on events that might take place tomorrow in the United States, that is not a date of which there is any certainty at this time. I am concerned that the amendment that is proposed in the legislation, under clause 2(2), in fact breaches Speakers’ rulings and would be out of order. So I would seek your guidance on that, and perhaps a considered ruling.

The CHAIRPERSON (Lindsay Tisch): Thank you for that. I will seek some guidance on this matter. This was a provision that was put in place by the Foreign Affairs, Defence and Trade Committee and agreed to at the second reading. It happens to be here, but I do take on board what you are saying. I am happy to seek advice on that matter.

GRANT ROBERTSON (Labour—Wellington Central): It is a pleasure to take a call—the first of a number of calls I hope to take—in the Committee stage of the Trans-Pacific Partnership Agreement Amendment Bill. I want to start my contribution—or I would have done had we been doing a clause by clause debate—with clause 1, which is the title of this bill. This emphasises part of the problem that we have here today. This bill is called the Trans-Pacific Partnership Agreement Amendment Bill. As is the nature with legislation like this, there is not actually any one piece of legislation to amend. There are a series of very small and in many ways inconsequential amendments to a number of different Acts: the Agricultural Compounds and Veterinary Medicines Act, the Copyright Act—actually, the amendments to the Copyright Act are not inconsequential, and I will come back to them in the fullness of time—and also around the various trade provisions in Acts that we have.

That is part of the issue here, because many New Zealanders have been concerned about something called the Trans-Pacific Partnership agreement (TPPA), as named in clause 1 of this bill. But, as such, it does not exist in New Zealand law. That highlights the problem of the fact that this Parliament has not had an adequate opportunity to debate the overall nature of the TPPA, and of the ability for New Zealanders to reflect their concern about that.

I think, over the years, it would be fair to say that I have changed my views somewhat around Parliament’s role in looking at agreements like the TPPA. This is because as trade agreements themselves have changed and developed from being fairly basic agreements about market access and services, and access of goods and services to markets, to the more complex agreements like the TPPA—the 6,000-odd pages of it—I think there is a greater case for more public scrutiny and more public debate on whether New Zealand should be part of these agreements. The issue we have today, as we come to debate this, is that New Zealand has already signed up. New Zealand has already signed up—this is the ultimate box-ticking exercise; this is the ultimate arrival in Parliament, where—

Todd Barclay: Sit down—sit down.

GRANT ROBERTSON: Ha, ha! Todd Barclay has just told me to sit down. That is not going to happen, Mr Barclay. In fact, Mr Barclay, if you keep that up, you are going to be here for a very, very long time because this piece of legislation is not supported by a lot of New Zealanders—not because of the detail of the amendments to the Acts that are contained within here, but in part because Mr Barclay and his Government have decided not to take New Zealanders with them, have decided not to have a proper discussion with New Zealanders about the benefits and the costs, but rather to sign up and then come looking for a rubber stamp from this House. That is not what we are elected for. We are elected as members of Parliament to actually represent our constituents, and to debate and decide upon what is best for New Zealand. This is the sovereign Parliament of New Zealand, and I am sorry to say that the way that the National Government has approached this agreement means that the sovereignty of this Parliament has been undermined.

I would say, when I look at the title clause and I see the “Trans-Pacific Partnership Agreement”, I wish that we were really debating that agreement; that we were really debating the pros and cons of that—the costs and the benefits. But instead the legislation is actually a series of technical amendments to various pieces of legislation that are affected. There should actually be, I would say, considerably more bits of legislation being amended here—were it not for the fact that New Zealand has actually largely removed most of the tariffs that would potentially have been in another country’s piece of legislation ratifying the Trans-Pacific Partnership agreement. Over the years, our lay down misère approach, as I discussed in the second reading, to trade negotiations means that New Zealand ain’t got much left when it comes time to negotiate in trade agreements. That is the case for New Zealand when it comes to the TPPA.

The second point I want to make about the name of this piece of legislation is that, actually, in some ways it is a bit more honest than some of the commentary from the Government has been about what is actually happening here. We keep getting comments from National Government members about how anyone who is opposed to this is opposed to trade. Well, what utter and complete nonsense. I have stood in this House before and debated free-trade agreements (FTAs), and they have been called free-trade agreements or free-trade ratification agreements. This one does not say that. This one calls it the “Trans-Pacific Partnership Agreement”. That is actually a reasonably fair reflection of an agreement that goes well beyond actual market access, the actual tariff debates—in fact, we do not have a lot of that in here. What we have are things like amendments to the Overseas Investment Act, because, actually, the Trans-Pacific Partnership is an agreement—yes, about some market access provisions—but also about the way Governments regulate and about the way Governments make their decisions; the kind of decisions that this Parliament should be making.

The frustration for members on this side of the Chamber is that we are not actually in here today debating, for instance, the decision of the National Government to deny a future Government the right to say who it is who should be able to buy residential property in New Zealand. In other Parliaments around the world when they are debating the ratification—when they are in Australia or when they are in Vietnam—it will be debated; in Singapore, it will be debated. This is because those countries decided that “Yes, we will actually reserve the right of our sovereign Parliament to make a law in that way.” But that is not here. That is actually not one of the clauses that we get to debate today because the Government did not come to this Parliament before it signed up to that—or, in fact, signed away the right for New Zealanders to do that. So this agreement, the TPPA, is fundamentally different from the New Zealand - China free-trade agreement or the New Zealand - Korea free-trade agreement, which we have debated before in this House and which the Labour Party not only initiated but, in the last 8 years, has been prepared to support—the ratification of those agreements. This one goes further.

This one goes further, and at the same time, the Government has done as little as possible to take New Zealanders with it in going further, in explaining what some of those benefits might have been, and being honest about what the cost might have been. I do want to say this now that the Minister in the chair, Todd McClay, is here—because he was not here when I said this in the second reading—and that is that, actually, I think he has started to do that now that he has got into the job. He has actually started to get out and get around New Zealand and say: “This is what’s happening.” Well, sorry, it is too little, too late, because the previous Minister, Minister Groser, knew so much more than the rest of us did—

Hon Member: About everything.

GRANT ROBERTSON: About everything, actually, but about this in particular. He did not need to do it, he knew everything; free trade was in his blood. This is the man who once said that Closer Economic Relations (CER) should be called GER—“Groser Economic Relations”—because he was the third secretary in the embassy in Canberra when it was passed. It is that attitude from Mr Groser that typifies what is wrong with this agreement: negotiated without being transparent for New Zealanders about what was involved, and relying on “constructive ambiguity”, as he told Mrs King and myself in a meeting where he said we could talk about everything he said. When we questioned whether or not New Zealanders would pay more for medicines because of the changes that were being made here around patent law, he said there was constructive ambiguity. Constructive ambiguity—that is as good as it gets from this Government when it comes to the TPPA.

So it is difficult for members on this side of the Chamber to be able to stand up and make the contributions that we need to make on this, because, actually, the legislation in front of us does not give the full picture of what the TPPA is, and we have not been included in the debate at the appropriate time. I know from when we did less complicated trade agreements like the New Zealand - China FTA that we worked hard in Government to make sure that stakeholders knew. We met with unions, we met with environmental groups, we met with businesses, and we talked through what we were doing. We trusted those people to have New Zealand’s best interests at heart and to be part of the discussion. Not this Government—total veil of secrecy, and then Mr Groser telling us at the end to trust him and that he knew everything.

The sad reality is that he told us this would be a gold standard agreement. It is not a gold standard agreement—it falls miles short of that in every respect, and, at this stage, it does not even look like it is going to enter into force anytime soon. So here we are, debating to ratify something that probably will not ever exist, that will be renegotiated, and that was put forward by a Government that did not do for New Zealand what it should have. This could have been done so much better than it has been.

Hon ANNETTE KING (Deputy Leader—Labour): I am surprised that the Government members, who are so proud of this agreement, have got their bottoms stuck in their seats. I wonder whether they are going to, at some stage, get on their hind legs and contribute to the debate. I am looking forward to hearing from them, because I have listened to a lot of blatherskite—my favourite word—from this Government over the last few years on trade policy. One of things it has tried to do is paint the Labour Party as anti-trade. Well, I think we could probably give it a few lessons on how you go about negotiating a trade deal.

The Government likes to come into this House on a regular occasion and trumpet the wonderful things that have come out of the China free-trade agreement, negotiated and passed under a Labour Government—the only thing, I think, that is probably holding up our economy, in fact. When we were in Government, we negotiated a free-trade deal that got wide acceptance. But what happened when we got to the Trans-Pacific Partnership? Many of us started off thinking: “This could be a really good idea. This could be an extension of the China agreement into other countries. This could be good for New Zealand.”

But what we managed to get from this Government and from the negotiation was to allow a number of other things to be included in an agreement that has nothing to do with trade—it has nothing to do with trade. So it is not a free-trade agreement; it is a free-for-all agreement. It has got everything in it. The fundamental error the Government made was to rely on Mr Groser to be the advocate and the negotiator for this agreement. I have to agree with my colleague Grant Robertson that Mr Groser came across, to me, as a person who was far above the rest of us, who knew more than anybody else in this entire Parliament—in fact, he created the world in 6 days. I found his attitude appalling. I was at the meeting where we met for the confidential briefing after it was all signed and sealed, and we were told that we could speak about what we were given at that meeting. When we did go out and speak about it, we were attacked for speaking about it. The words that he used when it came to patents—

Grant Robertson: Constructive ambiguity.

Hon ANNETTE KING: Constructive ambiguity. What is constructive ambiguity? It sounds like an oxymoron to me. What is constructive about the ambiguity that he wanted to put into this agreement? I think we could be wasting our time, because tomorrow the 45th President of the United States will be elected. If you have been watching what is happening, both Trump and Clinton have said this deal will not be passed in their Government. So what we are relying on, when we are ratifying this, is the slim hope that Obama somehow is going to, in the lame duck period, pass the legislation. Well, I put this to the Minister, Todd McClay: why would the Republicans give him a thing? They have denied him every move he has tried to make in Government. They have blocked practically every move he has ever made. Why, at the last moment, would they capitulate and give a win to Obama?

So I would say that we are probably wasting New Zealanders’ taxpayer money holding this debate now. Would it not have been more sensible for us to have waited to see what the next President of the United States would do? My understanding is that you have to have 80 percent agreement to this deal, and if you do not have the Americans in, then you have not got 80 percent. We were also told by others—in fact, I think Hillary Clinton said: “We’ll renegotiate it.” Well, we were told by Mr Groser and others—I think, even by the Minister in the chair, Todd McClay—that you cannot renegotiate it. So who is telling the truth here? Can we renegotiate this or can we not? Todd McClay said we cannot. Of course Mr Groser—who knew everything—said we cannot. Mr McClay said we cannot. Hillary Clinton said we can. I hope we can believe our Minister, that what we have got, we are stuck with. So, in fact, the things that are wrong in here are now set in concrete. What is set in concrete and is wrong, as far as I am concerned, is the way it has been negotiated.

One of the things that really appals me—and the Minister might like to explain—is that we capitulated and rolled over like pussycats to have our tummies tickled on the whole issue of foreign non-resident buyers in our housing market. Why did we not have the guts to stand up like Australia, like Singapore, like other countries that said: “We have sovereign rights over what happens to our land and property in our country.”? Why did we roll over and allow that to be carved out so that we cannot have the same deal made by Australia and Singapore and other countries that showed considerable stamina and courage and ensured they looked after the sovereignty in their countries? I do not understand that, Minister.

This Minister probably is not to blame, but why were we so keen? We did not need to give that away. There were other countries that did not give it away. But, you know, if there is one thing that has got up the nose of New Zealanders, it is the fact that we were prepared to say: “Anyone can come here and buy what they like. Doesn’t matter if you don’t live here, you can buy up the houses—none for New Zealanders; doesn’t matter.” So that, I think, has offended many, many New Zealanders, and it certainly offends me.

But the one thing that I think needs explaining is the whole issue of patents. I think it is interesting if you go back and read the regulatory impact statement from the Ministry of Business, Innovation and Employment and what it said about the whole area of patents. It set out what had been negotiated. It said that it was to enable a reasonable delay in terms of a patent being applied, and if there was a reasonable delay, then there could be a response from that.

But what was more interesting to me was what the ministry thought about this whole issue. It said this: “13. An obligation to provide patent term extensions could result in costs to the New Zealand economy. 14. New Zealand is a net importer of patented technology. Most (85 – 90%) of the patents granted in New Zealand are granted to offshore applicants. If the terms of any of these patents are extended, this could impose a cost on the New Zealand economy as local businesses and consumers would have to pay higher prices for longer on products using patented technology. The cost could be particularly high if a patent related to a pharmaceutical were to be extended. When the patent on a pharmaceutical expires, the price may drop as much as 80 – 90% as generic versions of the patented pharmaceutical enter the market.”

A large number of the pharmaceuticals that Pharmac can afford in this country are generics. The reason why we have a large supply of pharmaceuticals is that they are generics. I have concern over this issue, and the concerns are not just mine. Our top health professionals around this country have raised their concern over this issue. I have to say that it is still not clear to me what would constitute an unreasonable delay. They say it could be the delay between when it is lodged and when a decision is made. What if something happens in between that is not of the making of those making the decision? I can see this being used by those companies that wanted to take away the 5-year patent on data exclusivity—to use this to in fact attack New Zealand and to ensure that they get a longer patent on their products. That will cost us in money. It will cost us in the health of New Zealanders.

I do not think this has been properly explained by the Government. I do not know how much notice it took of the ministry when it wrote this regulatory impact statement, but what I do know is that with these new biologic drugs, if we cannot get access to the data of that so that other companies can use the data and start creating generic drugs, we will see more of the problems we had with Keytruda, because we will not be able to afford the drugs that are still on patent. I think that this Government is going to cost us a lot in terms of the health of New Zealanders and the taxpayer.

Dr MEGAN WOODS (Labour—Wigram): It is my joy to take this slot, just before the dinner break.

Grant Robertson: Drive time.

Dr MEGAN WOODS: Drive time, as you say, Mr Robertson. It is nice to see that the Government benches have realised what we have long known about the Hon Annette King. She is a force of nature. We have these staunch proponents of trade who are all firmly glued to their seats, unwilling to take a call in this Committee stage to debate this very important piece of legislation that we are told over and over again by Government members is so critical and so good. But, obviously, the powers of the Hon Annette King have persuaded them all there.

As has been said by the previous speakers, Labour cannot support the ratification of the Trans-Pacific Partnership agreement (TPPA) through this bill that we are here debating today, because the bill’s passage through this Parliament facilitates the final ratification of the agreement. As my colleagues Grant Robertson and the Hon Annette King have talked about, what we have in this is an omnibus bill that puts together a lot of small changes—some of them not so small—but in and of itself there is a broader issue that does need to be discussed.

I do want to look at some of those broader issues, but also in the course of this contribution I want to have a look specifically at clauses 66 to 70 in Part 7 of this legislation: “Amendments to Overseas Investment Act 2005”. I, more specifically, want to have a look at what this is not covering, what these clauses from 66 to 70 do not cover, because I think by and large that is of a great interest to this Committee as well.

What we have said time and time again is that Labour is a party that supports free trade when it is about trade.

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

Dr MEGAN WOODS: It is always a pleasure to take a call split by the dinner break. When we last tuned in, I was outlining how Labour had always been a party that supported free trade, but what we have in front of us today is not about trade. What we have in front of us is some enabling legislation for something that goes much broader than that. My colleagues, before the dinner break, have touched on several of Labour’s concerns and objections to this legislation.

Before the dinner break, Hon Annette King was talking about our concerns in regard to Pharmac as well as other areas and the ability of New Zealand to have the kind of health system that we want to have with the kinds of expansions put around patents under this, and, in particular, our ability to be able to afford the next generation biologic drugs that we will need. We have already seen that we are starting to need these in our country.

One of the things that has also stood at the centre of Labour’s inability to support this agreement and the subsequent legislation that we are here debating today is that when you looked at it, the case just did not stack up. We were sold by Minister Groser, when he was going off to negotiate this, on what a huge benefit to New Zealand this was going to be. But when the national interest analysis that accompanied this treaty came back, we saw in stark reality what it did mean.

Was it going to be the huge win for dairy that the Minister said it always had to be or he was going to walk away from this? No, it was not that huge win for dairy. Instead, we saw very minor gains for dairy. We saw that the increased access, not the profit, would be the equivalent to the output of only three large dairy farms begs the question why he did not walk away. The gains that were promised simply were not there. But more than there just not being the gains there was an alarming analysis that was undertaken by Tufts University that talked about how it could be that 6,000 jobs within New Zealand could actually be lost because of this legislation. So not only would New Zealand be not making the gains that were originally sold to them when people first came to look at the idea of the TPPA, but actually some people would be worse off. It is as the Hon Annette King said. When this idea of the TPP first came up there were lots of people who thought “This could be good, let’s have a look at what it has to offer for New Zealand.” But the simple and stark reality is that it just did not pan out.

I know that everyone will be remembering before the dinner break that I said that I was specifically going to talk to Part 7 of this legislation, and particularly clauses 66 to 70. These are the clauses that amend the Overseas Investment Act 2005. What the bill commentary says is: “Clause 69 would insert new section 61A and provide a regulation-making power to implement alternative investment screening thresholds for overseas investments in significant business assets. Under the Agreement, and under the most-favoured nation obligations in certain international agreements listed in new section 61A, the threshold above which an overseas person must get approval to invest in significant business assets in New Zealand must increase from $100 million to $200 million for non-government investors from parties to those agreements.” I could go on but I will not, in terms of reading from the description.

What is contained in these clauses 66 to 70 is that the Government did not stand up for New Zealand, and Tim Groser did not stand up for New Zealand when he was off doing the hard negotiations around this. When he came back he said that we simply could not put in the protections so that we would not lose the ability to restrict the sale to foreign investors of our homes, our farms, and our businesses. He said that it could not be done—simply could not be done.

The reality that New Zealanders have to face is that our Government did not fight for us in the way that other Governments fought for their countries. So when Tim Groser said that one could not do it, well, other countries did. Other countries did exactly that. Australia did that and Singapore did that. Other countries got agreement that there would be the ability to put those kinds of restrictions in place. But where in clauses 66 to 70 is there the evidence that our Government stood up for us as New Zealanders when they were negotiating this agreement? It is nowhere. That is the answer to that. It simply is not in that because that is not something that this Government was interested in doing. It should have stood up for New Zealanders and they simply did not. Minister Groser said that it simply could not be renegotiated, but we have people around the world now saying it could be.

So there are a number of issues that have been brought up around this, and Grant Robertson brought up a point of order at the beginning of this debate around the clause that is actually dependent on something that we do not know that it is going to happen. We wait with bated breath to find out whether or not that is indeed in order, because we are all going to be glued to our sets tomorrow to find out what the outcome in the States is. But the reality is that both candidates in the US presidential election have said they are not in favour of this agreement. So why is it that New Zealand is steamrolling ahead, putting in place this enabling legislation for a treaty that we do not even know is going to pass the threshold? If the United States is not going to come to the party on it, then it is a dead duck itself. It will not get over the line. So I would like to hear from the Minister in the chair exactly why it is that we are pushing ahead at the pace we are, when we do not know the context that we are going to be dealing with and whether it is even going to be required.

When we look at this Trans-Pacific Partnership we can see the Government has promised so much from it, but what we are seeing here today is a Government that now just wants to be quiet at every turn around it. Government members tell us that it is going to be the boon for business. They have small businesses telling them that they are not in favour of it. Just over a third of small businesses actually want to see the Trans-Pacific Partnership enacted. The rhetoric simply has not stacked up with the reality and with the analyses. This is why Labour, a party that does back genuine free trade where it can be shown to have a benefit to New Zealanders, is unable to support this legislation, which would be the enabling legislation for the Trans-Pacific Partnership agreement. That is something that we will stand by and stand up for New Zealanders on.

FLETCHER TABUTEAU (NZ First): I thought I would start this evening, in terms of a contribution, around the title and the commencement date because I would like to acknowledge an earlier contribution from my colleague on this side of the Chamber. I will speak first to the commencement date and make reference—well, I will not go through the specific Speakers’ ruling, but it does say that if the commencement date is amended, which it has been in this legislation, then, actually, the vagueness of the start date is not only inappropriate but not acceptable under the House’s rules. I note that it was changed in this version when it was brought back to the House, so that we could make some vague statement around the date on which the Trans-Pacific Partnership agreement (TPPA), done in Auckland on 4 February enters into force. It is not specific enough, according to Speakers’ ruling 130/2. I think the consideration asked for by the member earlier is not only valid but needs serious consideration and it calls for the House to come back and hear the Speaker’s ruling on that.

I then thought I would speak to the title, and what I thought was that what we have got currently is the Trans-Pacific Partnership Agreement Amendment Bill, but I thought the “Trans-Pacific Partnership (Agree Anything) Amendment Bill” might be more appropriate. I say that because I have never had the privilege of speaking to Mr Groser, and I do feel like I have missed out on a wonderful opportunity, but what I have had the opportunity to do is speak to previous employees of the Ministry of Foreign Affairs and Trade. The conversation ran around the fact that the previous Minister of Trade’s stance on trade agreements was: “Let’s sign up to anything, and then come back home and sell it to the people as something that’s great for this nation.” I think the TPPA is perhaps the prime example of an agreement being brought back to New Zealanders as a gold standard—and it could be a gold standard only if it was agreed to by the Minister—and I think New Zealanders will find that it is absolutely not that, at all.

I will quote a word, really, from one of the submitters. They were “flabbergasted” by the analysis and numbers used in the interest analysis, which they used to inform their submission to the select committee. I make that reference because in our analysis of this partnership agreement, the select committee was essentially forced to use an analysis that was abbreviated. It was a shorthand and, to be quite honest, it was insulting at times in the numbers that were given to us and what we were expected to take at face value, especially when we were able to contrast it with overseas analysis done and actually, to be fair, with some contributions from academics here in New Zealand.

The point there is that we are talking about amendment legislation to the Trans-Pacific Partnership agreement, which in the main, I have to say, is quite technical and quite small, because we are a country that is already set up to go in the main. But that word—that they were “flabbergasted” by the analysis and numbers used—was a direct quote from one of the submitters, and that is what we are having to go through now. When we look at the submissions and when we look at the enabling legislation in front of us, we were not given the information that we required to truly understand what the implications of this were or what the enabling legislation would bring about, such that—for example, the copyright terms and the patent procedures.

The Hon Annette Sykes—Annette King, sorry. What a Freudian slip—sorry. That was not intended—[Interruption] Yes, yes. She spoke about the Pharmac transparency model, and I would have to agree with her completely. The situation with that model, which is part of the enabling legislation, is such that we now have requirements on Pharmac to produce reports that can be used by any interested party in an analysis of Pharmac’s decision-making procedures. The conversation around that was in the uncomfortable state in that we know—and I use that word strongly, I admit—that a lot of those overseas international corporates will be using that facility to attack Pharmac’s decision-making on behalf of the people of New Zealand. I have had some debate online with some pretty reputable people who know a lot about the Pharmac model, and they tried very vehemently to dissuade me from my thinking, but this is the truth of the situation.

There is that whole question mark around transparency, and what I want the Committee to realise is that, actually, without even going into a renegotiation round—because we do not know what the Clinton or Trump blocs will do in terms of the ratification process—right now it is our understanding that there are side letters being circulated around the member State countries trying to circumvent what is a locked-in agreement such that we will be obliged to extend those patent extension periods even further. So these side letters are being circulated—that is what we are being told—but in an agreement where the American administration, by way of its process, has locked it in. We have said we will not renegotiate, and yet these side letters are being circulated on Pharmac, so it is a huge question mark as to what will happen with our biologics, and we know how critical they are as we move into the future.

So the issues are technical, as I said. They are minor, a lot of them, but there are a few significant changes where many of the submitters, especially around copyright and access to technology—I will find the technical term for a later contribution—were almost at odds in their contributions to the select committee. It was a confusing piece of legislation for both sides of the argument. Even those who supported it would often tell the select committee that there was a great deal of confusion and a lot of unnecessary detail in terms of the law and that it made for a confusing read, and many of the submitters said: “Let’s just not do it. Let’s wait for the ratification to go ahead, so that we actually know what it is that we are signing up to.”

I just want to finish this contribution by saying that we are here today after having completed the second reading quite precipitously. We are here now going through the motions, and yet we have Japan, which is going to run this through its Lower House very quickly to beat us to the goalposts in terms of supporting Obama’s attempt to push this through in the lame duck period—but, actually, that has fallen by the wayside. We have got Canada, which has been prepared to stand up from the start and say “We’re not going to say anything about this until we’ve had genuine engagement from the public of Canada.”, and it means genuine. It is still going. A year later, it is still engaging with its community base. We have got Vietnam, which had a great level of support from its public, actually—from its people—but the Government has decided that it is not in a position, and it does not want to be in a position, to race through the ratification. That has sent a quite strong message to the Obama administration with regard to his efforts in the lame duck process.

I say to the Committee this evening that we do not need to be here—we should not be here. The submitters themselves have talked about the confused nature of what it was they were submitting to, because of the interest analysis, and so much of what we see here is confused, it is unnecessary, and, as I said at the start, the timing of it is entirely in question. Thank you very much.

Hon TODD McCLAY (Minister of Trade): Can I thank colleagues for their contribution to the debate so far. I think it is a respectful debate and a very, very useful one, and I think anybody listening in will be enjoying it because this is very much the way that this House should conduct discussions about trade, more directly.

I want to go through a few of the points that have been raised by colleagues around this, but, before I do, I very much want to speak in favour and in support of the Trans-Pacific Partnership agreement as negotiated and signed, and certainly pay a very big compliment to the previous trade Minister, Tim Groser, for over 7 years having negotiated what many people said would not be possible and actually reaching agreement with 11 other countries that represent 800 million consumers—almost 40 percent of the world’s economy—spending $27 trillion of GDP every year. It gives unprecedented access for New Zealanders, New Zealand goods, and New Zealand services to these very important markets to us. I guess I would argue that the only country for which we have better access to through a comprehensive free-trade agreement would be Australia through Closer Economic Relations (CER), something that has been in place for so very, very many years.

It is pleasing to hear from members that they do support trade and recognise the importance of trade to New Zealand. You know, we are a country of 4.5 million people that can produce in an area of food—food alone—to feed 40 million people. I wonder, if it were not for our ability to sell internationally, whether or not generally we would run out of things to do after about March in the year. If without preferential access—or, in many cases, just fairer access—to countries because of free-trade agreements (FTAs), whether or not around about February—about the time this Parliament comes back to start work—the economy would run out of things to do.

I do want to pay credit to the previous Government in starting the negotiations, and Phil Goff, actually, for starting the negotiation of the Chinese free-trade agreement, because that has been exceptionally important to New Zealand over the last 8 years since it has been in place. And the China free-trade agreement is very similar to the Trans-Pacific Partnership agreement (TPPA) in as far as it is a comprehensive free-trade agreement.

Mr Robertson mentioned that this is more than just around the liberalisation of tariff schedules, and he is correct—it is. But actually, it has been quite some period of time since New Zealand—or any other country, really—has gone out and negotiated a trade agreement based just on tariff lines and tariff schedules. Actually, it is very important for our economy that we are more ambitious than that. The reason for this is we are not only a country that produces goods and sells them overseas; we are a country that also now provides services, increasingly, significantly, around the world. We are also a country now that invests overseas, and so on and so forth. So, it is important, I think, that our agreements are comprehensive. It is also important that they deliver for all parts of our economy.

I do want to say that when it comes to consultation and engagement—it has been said before; I will repeat it—this was a widely consulted-on free-trade agreement. Some of the people who were consulted in the very early days—I accept it was 7 or 8 years ago, and it is a very long period of time. But I asked the Ministry of Foreign Affairs and Trade to have a look for me to make sure—when I stood up in public in one of the more than 50 meetings I did around the country, as part of the 18 roadshows and hui that we did up and down New Zealand, including more when people asked us to do them; to talk about the agreement, to explain it, and to go through it with them—that it had been widely consulted on. I was informed it was, and I accepted it was.

But what I would say is, since becoming Minister and since having signed this agreement, I do believe and accept there is a difference between consultation and engagement. I think that is quite important. So I have been talking a lot about a trade policy strategy refresh that we are working through now, and that is very much about trying to engage as well as consult. With members of this House, I would be very keen to find better ways to do this going forward. But, I do believe that even if we had engaged differently, consulted differently—it would have been hard to consult more, but if we had done that—I do not think we would have had a different outcome, or would have come to this House with a different agreement than the TPPA, because I do believe it delivers for us.

We heard Ms Woods say that dairy was a big loser in this, and, yes, it is fair to say—

Dr Megan Woods: I said it wasn’t a big winner. Not a big winner.

Hon TODD McCLAY: Well, if it was not a big winner, that is almost the same, I guess, as saying it is a big loser, as others have. However, all right. I will accept, therefore, that the All Blacks were not big winners the other day when they played rugby, but in this instance, I think, dairy did do very well.

Yes, it is correct that we did not get full liberalisation of dairy access to other countries. It is also correct that we got lower tariff rates and new quotas into a number of those countries, which means that we do have better access now than we did in the past, and we do have the ability in the future to keep challenging and looking for more from this at some stage in the future with our trading partners. However, dairy is one of the most heavily protected industries in the world—it is certainly very heavily subsidised—and New Zealand always goes to argue for a fairer deal for our farmers into these markets.

Of current trade volumes or flows, by value, into Trans-Pacific Partnership (TPP) nations, when fully enforced, there will be a $274 million tariff saving. Dairy is almost $100 million of that, and, actually, to our dairy farmers, that will be quite welcome. Is that enough? Do we think people should continue to liberalise? Do we actually want to see less protection of dairy around the world? Absolutely, we do. Do we believe there should be less—if not, no—subsidy in dairy and other agricultural products around the world? Absolutely we do, and we go and argue that in our free-trade agreement negotiations, we argue that in the World Trade Organization. But an almost $100 million saving for dairy on current trade values is, I think, significant.

But what we also see in the TPP are some areas where there was full liberalisation around dairy—not as a commodity, but as a product where we add value. So into the US, for instance, if you want to sell cheese or add value to milk products here—a little bit of sugar, some flavour, or maybe some kiwifruit, and you want to sell it to the US as ice cream—in many areas there is full liberalisation, and so there are opportunities for New Zealand to add value to products here and export them overseas, creating and protecting more jobs in New Zealand and actually growing our share of trade. A total of $274 million of tariff savings on our current trade values, not taking into account any extra trade that we will do as a result of this—that is a win for New Zealand, and it is a big win. I think those tariff savings will be greater because, in many cases, we will end up selling much, much more.

I will take a call later in this discussion to go into more detail, but I just want to address something that Mrs King said. I think it is very important—and we have paid a lot of attention to patent term extensions. She is correct that if we had to extend patents automatically or just because other countries wanted us to, there would be a cost to New Zealand. But in the text from the regulatory impact statement that she read—she was probably a touch selective in that, because if she went on a bit further it does show that the Government has been consistently clear that the patent term extension provisions of the TPP are likely to have a very limited impact in New Zealand. This is because the Intellectual Property Office of New Zealand and Medsafe are already very efficient—among the most efficient regulators in the TPP. So what this means is if there is an unreasonable delay, then that period of delay that is unreasonable can be tagged on to the end by way of an extension, and—

Grant Robertson: How do you define that?

Hon TODD McCLAY: —the analysis says that is not likely to happen very much at all. So how that will be defined is that Pharmac can go away, do some work, and it will set some regulations around this. But, ultimately, we have agreed that because it was important to some of our other partners. But there will be TPP countries where the delays are very, very long—many, many years long. So, for reasons of transparency and fairness this was agreed, but the impact upon New Zealand will be negligible and, indeed, I think Pharmac has said it will be about a million dollars a year, including some of the work it has to do to comply.

A final part in this is what Mr Tabuteau said around other parts of Pharmac and what it would do. Well, Pharmac has said that in as far as—there are only two changes to Pharmac. There will have to be a review process for any declined application. There is not a problem with that because, actually, just as people took a case to the Waitangi Tribunal to make sure that the Government was meeting its obligations to iwi, to Māori, under the TPP exclusion, it is right that if something is declined there is the opportunity for judicial review. The only other change is that Pharmac can set the time frame in which it will make a decision, and it is currently consulting on this and proposing 3 years; so it can make a decision over 3 years. If it is turned down, somebody can appeal the decline, but there is no need for it—

BARRY COATES (Green): I rise to speak on the Trans-Pacific Partnership Agreement Amendment Bill, and I would like to address the amendments to the legislation through, initially, an economics perspective. I think we have heard some generalities about this agreement and some assurances that I think are sadly lacking in terms of any rigorous analysis. In particular, I think the national interest assessment undertaken by the Ministry of Foreign Affairs and Trade (MFAT) was rather like giving the fox the keys to the hen house. Of course, the Ministry of Foreign Affairs and Trade would attempt to undertake an analysis that justified its negotiating position, and I think it is about time we started having some more objective analyses of these international treaties.

The economics of the Trans-Pacific Partnership agreement (TPPA) primarily rest on some very dubious assumptions. Those assumptions have been critiqued by the US Government in its International Trade Commission report, which directly criticised the modelling undertaken for the New Zealand analysis. They have been criticised by the Tufts report, from Tufts University, and by expert research in New Zealand published on the Trans-Pacific Partnership (TPP) legal website. The analysis by MFAT showed relatively modest economic benefits. The benefits were 0.9 percent of gross national product, which would be increased by the year 2030. By then, without the TPPA, gross national product was projected to have risen by 47 percent. So we are talking about the difference between 47 percent and 47.9 percent, which is a relatively small differential.

It calls into question the analysis, where on one side there were these relatively limited benefits and the other side there were completely unquantified costs and risks associated with many of the other obligations under the TPPA. But even that analysis of 0.9 percent by 2030 was grossly exaggerated. Only a quarter of that actually resulted from the tariff reductions that the Minister has just referred to. Those tariff reductions are real and there will be a benefit to some exporters, but, unfortunately, the effects have been grossly exaggerated.

Most of the benefits cited in the Government’s figure of $2.7 billion relate to non-tariff barriers. Over 60 percent of the economic benefits are from non-tariff barriers, and if we look at what these non-tariff barriers are, it is not clear as to whether these non-tariff barriers are actually legitimate regulations or whether in fact they are illegal barriers to trade, or barriers to trade that one would want to remove. There is no analysis between whether or not they are legitimate or otherwise. That is one of the reasons why the International Trade Commission—the US Government’s report—excluded those benefits. However, they were included in the New Zealand analysis and, at over 60 percent of the benefits, that was most of the economic benefit that was derived.

So if we then look at the effects of the economic analysis. Colleagues have previously referred to the Tufts University report, which showed that the modest amount of economic benefits would actually be associated with a drop in employment and a rise in inequality. These are accompanied also by additional costs that are the subject of the legislation—the amendments that we are talking about here tonight—costs of copyright, patents, and consumer costs from higher consumer prices.

One of the things that the TPPA should have taught us by now is, firstly, the problems with 7 years of secrecy in negotiations, where there was not adequate consultation during the negotiations on some of the important aspects that have come to light only afterwards. Secondly, what the analysis has shown us is the importance of objective research to be able to inform negotiations, particularly around areas of agriculture. Overall, the export benefits for New Zealand, in terms of additional exports to the countries that we export to—it is an average of a 2.2 percent increase. If we look at that 2.2 percent, it is significantly less than average monthly movements in the New Zealand exchange rates. It is significantly less than many movements on the Global Dairy Trade index. So an increase in benefits to New Zealand farmers of 2.2 percent is not going to drive production behaviour especially in the face of many other uncertainties.

Against this, there are the costs to the New Zealand economy. As has been referred to, the TPPA is not an agreement that is primarily about tariffs and quotas; it is an agreement primarily about the rights of Government to regulate in the internal economy. Significantly, it gives rights to foreign investors in many areas that are prejudicial to competitors in New Zealand. The TPPA will particularly harm small to medium sized enterprises (SMEs) that are struggling to survive against their multinational competitors, which often benefit from tax havens, and which often benefit from a lack of international competition policy. The New Zealand SMEs that are struggling to compete internationally with a flood of imports in many of their products now face enhanced difficulties in their competitive challenge.

One of those mechanisms is the investor-State dispute settlement (ISDS) mechanism, which allows foreign investors to take cases against the New Zealand Government over regulatory measures that might adversely affect the profits of those investors. I shall come back and talk a little bit more about ISDS related to the regulation tonight.

I want to talk a bit more about the agricultural trade implications. The TPPA has focused on reducing tariffs, and if we look at the dairy sector this is not a gold-standard agreement. The aims for this agreement fell well short. In fact, what happened was that because they fell well short, we have locked in artificially high tariffs in the dairy sector, which are way higher than the average tariffs for most goods traded internationally.

The second thing that we have done is we have ignored the major trade distortions. The major trade distortions affecting agricultural trade are not tariffs; they are primarily the subsidies that large agricultural producers receive, particularly in the United States, the European Union, and Canada. If we look at the level of agricultural subsidies in the United States, for example, the Congressional Budget Office estimates that the 2014 farm bill in the United States might account for US$1 trillion of subsidies over a 10-year period. Furthermore, dairy producers in the United States will be able to receive subsidies of up to 40 percent of their production costs. At a time of volatility in dairy prices, that vastly outweighs the measures that are addressed under the TPPA in terms of tariffs.

What has the TPPA done about removing those agricultural subsidies? Absolutely nothing. The difficulty here is that the only way those agricultural subsidies are going to be removed is through multilateral negotiations in the World Trade Organization (WTO). So immediately after signing the TPPA, the United States entered the WTO negotiations and said that it would like to end the negotiations within the WTO, including on agriculture.

This agreement is not in the strategic interests of the New Zealand dairy farmers. This agreement has many flaws in it, and I will come back to talk a little bit more about the costs at a later date. Thank you.

CLARE CURRAN (Labour—Dunedin South): I am pleased to take a call in the Committee stage of this bill. It has really been a very troublesome period in New Zealand history. Much of that is actually down to the awful process that has led to the bill’s gestation and coming to this House, and the awful process that was driven by this Government.

I would like to start, though, by giving the Minister in the chair, the Hon Todd McClay, a bit of a tick for—it is a bit late—his acknowledgment of the importance of engaging with the New Zealand community and actually listening to them. The problem is that it is a bit of an “after the horse has bolted” situation, but at least he does seem to have a different approach as the trade Minister, and, hopefully, that will lead to a less divisive situation in our country in future. But that is about all of the tick that I would give to the Government on this.

I have a couple of points to make first, and they will be made over and over again on this side of the Chamber by the Labour Party. The Labour Party is the party of free trade. We have always sought to deliver the benefits of free trade to New Zealand and to reduce the barriers to growth for our firms and for the workforce, but this deal is an example of how a Government did not trust the New Zealand people, did not talk to the New Zealand people, and instead chose to negotiate the deal in secret and to exclude the New Zealand people. That lack of trust and that, I guess, ultimate approach of being out of touch has helped contribute to where we are at now.

We are also in a situation of great farce because we are debating a bill in the Committee that gives effect to something that we have already signed. The second reason it is a farce is that we have a US election and we have two candidates who do not support the Trans-Pacific Partnership agreement (TPPA), and so who knows what is going to happen next. This is likely to all be a complete waste of time. It is also a farce because we traded away things that we should not have traded away, for very little gain. I think pretty much everyone in New Zealand acknowledges that. There remains a lot of distrust in the community, with 39 percent of exporting small businesses supporting the TPPA, says Mind Your Own Business in its 2016 survey of a thousand small businesses. That is very disappointing for the Government.

The Minister of Trade, in his contribution before in the Committee, talked about how this is about services. Yes, it is about services, and a lot of the services and the future of this country lie in its ability to innovate and in its ability to protect its own intellectual property. A lot of that is in software development in the tech industry, and it feels as if this agreement got negotiated on a wavelength that was very much rooted in the past. I hope that this is what the Minister is learning as he is going around the country talking to the likes of NZRise that represent some of the innovation companies that are New Zealand - based. We need to protect them and ensure that we are enabling them to have the best possible start so that they can build our economic development, but, unfortunately, that is not what happened.

The Labour Party supports Gareth Hughes’ Supplementary Order Paper 240, which is the insertion of the “fair use” amendment, which he also has as a member’s bill. I want to say that this is not only sensible; it is actually playing catch up with the major partner that we are trading with and negotiating this TPPA with, which is the US—which already actually includes fair use in its copyright law. In the explanatory note of his amendment, it says that this bill “extends and introduces United States-styled copyright terms without the corresponding United States-styled fair use copyright protections.” Just so people know what the definition of “fair use” is—the basis of which is in US copyright law—it is “the doctrine that brief excerpts of copyright material may, under certain circumstances, be quoted verbatim for purposes such as criticism, news reporting, teaching, and research, without the need for permission for or payment from the copyright holder.” This is not something that we should be arguing about. It is something that should just be sensibly included.

I want to refer to a report that came out of the University of Auckland written by Louise Longdin just over a decade ago, which talked about the Statute of Ann—and I am sure everyone in this Committee knows what the Statute of Ann is—and said: “Ever since copyright was conferred on authors by the Statute of Ann in 1709 for ‘the encouragement of learning’, one issue in particular has troubled and divided the world’s trading nations. This is the problem of how to fairly balance the interests of creators and owners of copyright material against the needs of those who wish to use and build on that material (or maybe even just parody or criticise it).”

Another quote from this report—and this goes to the importance of supporting the innovation economy in New Zealand—and this is a quote from Justice H Laddie, says: “The whole of human development is derivative. We stand on the shoulders of the scientists, artists and craftsmen who precede us. We borrow and develop what they have done: not necessarily as parasites, but simply as the next generation. It is at the heart of what we know as progress. [B]orrowing and developing have always been acceptable.” But one of the things this bill does is that it extends the term of copyright from 50 years to 70 years without any corresponding fairness and balance that acknowledges the digital environment on which our future economy needs to be based, and it trades away something of which we do not get anything back. We are poorer as a nation for that, and my concern is that when this deal was negotiated, there were people who did the negotiating who did not seem to get that. I hope that as the Minister is going around the country talking to people—and I hope that he is talking genuinely to communities of interest in all parts of New Zealand and in all industries, in our universities, and talking with our researchers, with our librarians, and with our teachers—he understands just what the importance of that is.

Although this amendment by Gareth Hughes is not the most major thing that has come before the Committee, it actually would be a step forward. It would be an acknowledgment to the people of New Zealand that there has been a shift in thinking and that there is the ability for the Government to acknowledge that perhaps it could have done things a bit differently. And perhaps it would rebuild some trust between the communities that were so upset and anti about the lack of acknowledgment of their views, and it might rebuild some trust back in that direction.

CATHERINE DELAHUNTY (Green): Tēnā koe, Mr Chair. Tēnā koutou katoa ko tēnei pō. I will just take a short call. I just want to lay down a couple of issues around this bill because, as others have said, it is technically obscure. I am sure the people tonight listening to it would like us to talk in a way that is comprehensible, just because the Trans-Pacific Partnership agreement (TPPA) itself has been obscure for many people. I went to a number of briefings where I came away none the wiser—because there is a lot of rhetoric and there is a lot of promotion and there is a lot of jargon, but, actually, there is not a lot of common sense and clarity.

I want to focus on one particular aspect of this, which, I think, is most disturbing and which we have an experience of in other countries that we should learn from. It also irritates me when everyone says that we are “pro - free trade”—as if there is no such thing as fair trade. The Green Party believes that trading is an inevitable and important human activity that has always and will always take place. Communities of all sizes have always traded. That is one of the critical ways in which we interact. It is not rocket science, and it can be fair. Free trade is the myth. There is nothing free about privileging corporations over community rights—it is not free. It is a misnomer, just like the TPPA is not a trade deal; it is an investment deal. It would do the public a service if we actually talked about things in an honest way, and actually talked about the need for fairness. I do not know whether anyone in this Committee wants to deny it, but some corporations own more than the economy of this entire country, and have enormous powers. Why would we privilege them over the needs and rights of citizens?

Marama Fox: Any more than they already are.

CATHERINE DELAHUNTY: Any more than they already are, as Marama Fox says. It is already an unequal playing field. One of the ways in which this is played out in this bill—and I am going to talk about the bill; fear not—is investor-State dispute settlement, which Barry Coates began to talk about. I want to talk about one example of why we are opposed to the TPPA and this provision, which our Government has been adamant in including. That is the experience of other trade deals in other countries.

Take, for example, the company known as OceanaGold, which owns the Waihī mines—the Martha Hill pit and the mines underneath people’s homes in Waihī. It has owned other mines, particularly in Reefton, in Aotearoa New Zealand. It tried to sue El Salvador for $301 million recently in a trade court. It lost, but guess what? It took 7 years: 7 years when the El Salvador Government—not the wealthiest Government in the world—had to defend its people’s right to object to gold mining polluting their water. It cost their Government $12 million. It will be compensated for some of it, but it cost it more than the money: it cost it a whole lot of energy, time, and sovereignty rights in defending in a trade court. And what is a trade court? Who are these people? They are not lawyers. They are not people’s representatives. They are not citizens. They are trade courts. I am fascinated by how they can invent these things, these mechanisms, through the World Trade Organization, etc. to suit the purposes of the corporates. It just happens to be this time that El Salvador won and OceanaGold—not my favourite company, because it is ruining my area and has ruined other areas—actually managed to lose this case.

There was something that has been described by, for example, Marcos Orellana of the Centre for International Environmental Law. I think it is important to quote, because this is what investor-State dispute settlement does. It is not a game. It is not a picnic. It is not something that countries need to waste their energy on, but these deals impose it. He said: “Regardless of the outcome, the arbitration has had a chilling effect on the development and implementation of public policy necessary to protect the environment and the human right to water.” That is how basic this is: the human right to water. Fair trade would protect the human right to water. Free trade, which is free only for the corporates, does the exact opposite. What matters in this world—[Bell rung] Mr Chair?

The CHAIRPERSON (Hon Chester Borrows): Catherine Delahunty.

CATHERINE DELAHUNTY: I will not take a full call, but I will finish my sentence. What matters in this world is water. If the corporates get control of these things, even more than they already have, this country will become yet another casualty, as El Salvador may well still be, despite winning in this obscure trade court.

I just want to briefly touch on the ideology behind the TPPA in this bill—I acknowledge that there have been some useful Supplementary Order Papers put up to help modify the impact—and one ideology is the fantasy world that the economy is more important than people. Free trade is riddled with this fantasy. The economy is more than a person! It is a giant person, who sometimes has a bad day—the economy had a bad day! The economy was struggling; the economy needed help! We give the economy this enormous power over people, and give it more validity than people, because otherwise the economy might become unstable. We do not control the economy; it does not work for us. We need these trade deals because the economy is so important and powerful and huge that we cannot break it down and recognise that it is about people and their rights to trade fairly.

That is what I object to about the TPPA. It pretends that these investments are going to benefit people who cannot and have not been able to maintain their rights to trade fairly. The economy, my friends, is just a subset and a tool of human beings’ right to live sustainably on the planet with each other and with the environment. These deals undermine that right and put the economy as if it were a super-god—a superhuman force that cannot be allowed to have a bad day.

We are opposing this bill because we believe that the economy should work for the people and trade deals should be fair. We believe that it is more than possible to design rules and regulations that are fair, that acknowledge Te Tiriti o Waitangi as a fundamental issue of sovereignty, and that will acknowledge the rights of citizens to determine their own relationship with the environment, to protect your own services and goods, and to maintain the privilege of living in your own country and saying that you will be considered first, rather than some multinational. But I can understand why we are not considered first, because the economy is God, and so the economy must be free! But the people do not get fairness when the economy is God, and that is the problem. We are modelling ourselves, supposedly, on a model that is failing people all over the world. Why do you think—sorry, Mr Chair. Why do people think—

The CHAIRPERSON (Hon Chester Borrows): I do think.

CATHERINE DELAHUNTY: —that there are massive protests in every country? Because we are all stupid, all of us who protested? Some of us have been doing this since the Multilateral Agreement on Investment, which failed and fell over because of confusion, public objection, and brilliant campaigning by some people. We will persist. The TPPA has not been won yet, no matter what game the New Zealand Government thinks it is playing. Globally, including in the United States of America, as I speak, people are opposing this. Many, many people have doubts that their own ability to trade fairly will be upheld by this deal. So talk as much as they like, we do not trust it, and why do we not trust it? It is because we have had this fantasy game going on for quite a few years now, and we are still living in a world of gross inequality, gross environmental degradation, and increasing unrest. The plan is not working, the economy is not God, and the TPPA is not what we need. Kia ora tātou katoa.

MARK MITCHELL (National—Rodney): It is my great pleasure to take a call on this, the Trans-Pacific Partnership Agreement Amendment Bill. Can I acknowledge the Minister in the chair, Todd McClay, and can I open by saying that I would like to acknowledge the Hon Tim Groser and the role that he had in delivering this free-trade agreement. I also want to acknowledge the advisers and our head negotiator, David, ah—

Hon Todd McClay: Walker.

MARK MITCHELL: —Walker, sorry. Thank you, Minister. I want to highlight one point. Former Minister Groser has copped a bit of criticism in the Committee tonight around transparency and around consultation. I just want to say that I remember when we were hearing submissions at the first go-around with the treaty. We had the trade unions come in to the Foreign Affairs, Defence and Trade Committee, and one of the things that they raised and were quite upset about was that there was no consultation. Of course, there was a fair bit of public debate going on about that and we were trying to listen very closely to it, but, on closer questioning, it actually turned out that there had been a fair bit of consultation and that the trade unions had actually been given three meetings with the negotiators and with the Minister to discuss what was in the free-trade agreement. That was a trend that continued throughout the process. I just want to set the record straight a little bit, in terms of former Minister Groser and the work that was done around consultation.

I do, however, want to acknowledge Minister McClay, because on taking over the role as our Minister of Trade, he embarked—it was very clear, I feel, that we had listened, and there were genuine concerns in the community about the lack of consultation and transparency around the agreement—on a series of over 50 public meetings around the country. He took other senior Ministers with him. He took David Walker and our officials who had been dealing with the free-trade agreement, and he embarked on a very comprehensive programme of public meetings.

I think the best way to highlight the effect that these public meetings had is to talk about the number of submissions that were received on our first go-around with the treaty, and then the number of submissions that we received when we actually had the legislation come to the Foreign Affairs, Defence and Trade Committee. In the first go-around, when the committee went out and asked for submissions in relation to the treaty, it received over 10,000 submissions. Admittedly, many of those were pro forma submissions, but it received over 10,000. When we went back out and asked the submitters as to who would like to actually come in front of the committee and make an oral submission, we had about 300 people come back and say that they would like to make an oral submission to the committee. We went to Auckland, we heard submissions in Wellington, and we travelled to Christchurch in the South Island, to make sure that everyone had easy access to the committee.

I want to acknowledge the committee. I would like to acknowledge David Shearer and David Clark from the Labour Party, Dr Kennedy Graham from the Green Party, and Fletcher Tabuteau from New Zealand First. On the Government side of the committee, we had Shane Reti, Lindsay Tisch, Todd Muller, Jami-Lee Ross, and David Bennett. Although it was very obvious that the Labour, Green, and New Zealand First members had taken a position against the agreement, and that, of course, the Government members were in support of it, I have to say that the committee decided right from the get-go that submitters who were coming in front of the committee would be listened to very, very carefully, that their issues would be recorded, and that we would address those with our advisers. That was a process that worked very, very well. I want to acknowledge the whole committee, which came together and worked in a spirit of making sure that the submitters were heard and that their issues were addressed. I am not a cynic—some people would say that that was just purely part of the process. Yes, it was part of the process, but it was an important part of the process in terms of giving people an ability to raise their concerns and have their say.

I just want to address one issue that was raised—I think it was by Dr Megan Woods—and that was around Pharmac. Yes, in relation to Pharmac, there are some additional costs. For a programme that is funded at about $800 million and growing—and I do not have all the details in front of me; I may need to be corrected, and the Minister can do that if so—from memory, the only real change to the Pharmac model is that there is allowed to be an additional review asked for inside the model. That meant that, basically, we had to budget around $2 million as a one-off cost up front. When you think about the size of the actual programme—over $800 million annually—that is a very, very small and insignificant cost. It does not change the Pharmac model in itself, at all.

I would just say too that in relation to support for the Trans-Pacific Partnership (TPP), of course we are all watching with bated breath to see the results of the American elections. I would have to say that in the House tonight it has been stated that Senator Clinton has taken a position against the TPP. That is not entirely true. She has actually stated that they would have a fresh look at it. However, it is true—and I do agree with the Opposition members—that Mr Trump’s policy in relation to the TPP is very closely aligned to the Labour policy on the TPP.

The only other point that I would make is that there has been some support for the Trans-Pacific Partnership from the Opposition parties—from highly respected leaders within the Labour Party—and that is, of course, the Rt Hon Helen Clark and the Rt Hon Mike Moore, both of whom have come out publicly and very clearly in strong support of the TPP. So it is with great pleasure that I stand and support, in this Committee, the Trans-Pacific Partnership agreement. Thank you.

RINO TIRIKATENE (Labour—Te Tai Tonga): I am pleased to speak in opposition to this bill at this Committee stage. I do so as a proud member of the Labour Party, which is the original party for free trade. But this bill is not a trade deal.

David Bennett: Tell us another lie.

RINO TIRIKATENE: It is not. It is not a trade deal, because this Trans-Pacific Partnership agreement (TPPA)—what does it do? It works in favour of the American multinational pharmaceutical companies. It works in favour of Silicon Valley technology companies. It works in favour of Japanese manufacturers. But it does not work for New Zealanders. Sure, there are benefits that we may have in the primary sector that we are seeing, but we have not had a full, proper analysis to really have a full assessment of the impacts of this agreement on New Zealanders as a whole. That is why we are opposing it.

Sure, if we look at it, protected dairy markets are still largely intact as a result of this, and yet it was lauded at the time that this would be a breakthrough deal for our dairy industry—our world-leading dairy industry. Well, that is not so much the case—not so much the case.

But I really want to shift the focus of my contribution at this time to look at the impacts of the TPPA on Māori, and in particular, on that groundbreaking Waitangi Tribunal report that was Ko Aotearoa Tēnei, into the Wai 262 claim. That was a groundbreaking claim all about the place of Māori culture and identity and traditional knowledge and its recognition within New Zealand laws. It covered big questions about who controls traditional knowledge and who controls artistic and cultural works—for instance, our haka, our waiata; our culture. Who controls the environment that created our culture, and that emerged from the natural environment? Those are big issues to Māoridom—big issues—and it took 20 years from 1991, when the original claim was lodged, through to 2011 for the Waitangi Tribunal to issue its landmark report, a whole-of-Government report, the first of its kind, where it looked into and made strong recommendations in this whole area. This is the real concern that Māoridom has: that by signing away this TPPA, we are losing control, even more control, over our taonga—and this is what it gets back to, our taonga—which is there in the Treaty that was signed. That was the basis of Wai 262. The fear for Māoridom is that we will lose even more control of this by signing away our rights in this TPPA.

I would like to give an example of that, because within the TPPA there is an obligation on New Zealand under Annex 18-A: Annex to Article 18.7.2 to either adopt the International Convention for the Protection of New Varieties of Plants or legislate for our own rights system that gives effect to that convention. That obligation could be very problematic to Māori, and yet we are getting no clear signal from the Government whatsoever as to what its plans are as to how we will give expression to that. The Government needs to be more up front, and that is what Māori are concerned about. It needs to be more up front so that we know exactly what that entails.

This goes to the point of ratification. Why is this Government racing—wanting to dive headfirst—into ratification of this agreement when these very important side issues have not been cleared off? The Government has not been up front with iwi Māori katoa as to what it intends to do around how we implement our obligation to this. I note there is the Treaty of Waitangi exemption, and it is the standard, boilerplate provision that is in there. But, again, words can mean a lot of things, but these are obligations that we apply.

I would just like to give an example. What say a Mexican cigarette manufacturer wants to put my ancestors’ tā moko on that company’s cigarette packets? What is to stop them from trying to make money off my tīpuna and off our collective cultural intellectual property (IP)? What will our Government do? If our Government tries to move in, to step in to try to—what will our Government do to try to protect our IP in that situation? How will the Treaty of Waitangi exemption apply in that scenario? Will we be hauled before some secretive international tribunal whereby another foreign State can lay claim against us for them being denied the ability to make money off our IP? I mean, these are serious questions that are of deep concern to Māori. The Government has not made the case. It has not made a clear case, and it has not been up front as to how it will protect our cultural IP in these matters, when it has already signed away its obligation to ratify and implement or, indeed, put in place its own regime. I certainly hope that the Government will be doing something that is accommodating of Māori concerns and that, in fact, aligns with its Treaty of Waitangi obligations.

But again, we have heard nothing from this Government on these matters—complete silence. Sure, it might be buying a little bit of time to try to implement these obligations that are imposed on it now that it has signed away and is wanting to ratify this agreement. But, again, it is of deep concern to Māori, to ngā iwi katoa, and I think it should be of deep concern to our whole country. We do not know the impacts that this will have on our cultural IP, and that Wai 262 claim is still sitting with this Government. It has done nothing on it. The Government has been sitting on it for close to 5 years, and in the meantime it has been rushing aside, trying to go behind secret doors, in complete secrecy, to ram through this deal, when that Waitangi Tribunal decision, recommendation, and report has just been sitting there, and ngā iwi katoa are waiting. We are still waiting. We want a response. We are deeply concerned at what this Government will be doing and the impacts that it will have.

As I have said before, Māori are very well aware of signing things when things can go very, very wrong. We are all too aware of the loss of our sovereignty, of losing what we think we have, when a piece of paper is put in front of us. That is why Māori are very concerned about the TPPA. Sure, there might be other positive parts to it. I do support those. Anyone wants to support things that will help our primary sectors, our productive sectors. But we need to have the full picture, as to what the implications are on copyright, on IP, and on cultural IP, especially in light of the Wai 262 report.

I was speaking to the daughter of one of the original claimants over the weekend. They are deeply concerned that the Government has done nothing around Wai 262 and yet it is rushing—rushing with all the gusto that it can muster—to ratify this deal, which we know is a redundant exercise because we do not know what is going to be happening tomorrow with the US elections. So why the rush? Why the rush? The agreement will not be coming into force until a couple of years from now, and that is provided all the countries that are a party to it ratify it. That is far from a certainty—far from a certainty. We should not be rushing this. We should not be rushing this. There are far too many very important issues to iwi Māori. The foreshore and seabed was a lesson for Labour, and I think Wai 262, the TPPA, and Māori cultural IP rights should be of concern to this Government. That is why I deeply oppose this bill. Kia ora.

The CHAIRPERSON (Lindsay Tisch): Members, at the beginning of this debate, Grant Robertson queried whether the commencement date in the bill was in order. A commencement date must provide certainty about when the Act is to come into force. It may not rely on an indeterminate event. That is Speakers’ ruling 130/2. Clause 2 of the bill provides that it comes into force on the date appointed by the Governor-General by Order in Council. That is a relatively common method of providing for a commencement of an Act. However, it goes on to say that the date of the Order in Council must be the date on which the Trans-Pacific Partnership agreement (TPPA) enters into force for New Zealand. That is an unusual feature.

It is important that the House knows, when it is legislating, the determinate event that will cause a bill to come into force. The House must also ensure that, where a bill commences by Order in Council, the Executive Council knows when it must act. It does not seem to me that the event that would cause this bill to come into force lacks clarity. It is always possible that the TPPA or any other treaty will not come into force if member States do not agree with it. However, the bill provides that if the treaty does come into force, then the Order in Council bringing the bill into force must name the same date for commencement. The commencement provisions, in my view, make it clear what event would cause the bill to come into force, but not whether it will come into force. That is a matter somewhat beyond the control of this House. I am satisfied that the current commencement date does not infringe against Speakers’ ruling 130/2.

As I noted earlier, the commencement date is already part of the bill, recommended by the Foreign Affairs, Defence and Trade Committee and agreed by the House at the second reading. Although this Committee could amend the commencement date and I could rule on the relevance of an amendment, it is not within the power of the Chairperson to rule out of order something already agreed to by the House. However, for the reasons I have just given, that is not a course of action that needs to be contemplated.

EUGENIE SAGE (Green): E Te Māngai o Te Whare, tēnā koe. Thank you, Mr Chair, for that clarification. But I guess it is like a lot of things in this bill: it gives the executive greater power than the power of the Parliament, and I will come to talking about that in a moment, in terms of the changes to the Overseas Investment Act.

Before Mark Mitchell spoke, it seemed obvious that the National backbenchers were stuck like limpets to their seats and really unwilling to rise and defend this bill, given the huge public opposition to it and the opposition from this side of the Chamber. I think it is a bit rich now that the Minister, the Hon Todd McClay, is conducting a trade refresh with businesses, iwi, and the public, because it is rather too late to be consulting about the Trans-Pacific Partnership agreement (TPPA) and trying to restore the faith of the community in the Government’s negotiations of trade agreements when we have this bill before the House and when the whole process of negotiating the TPPA has been so mired in excessive secrecy both by officials and the commercial side.

The public has not been allowed to see the text until very, very late in the process. It was a 6,000 page text. The submitters got very little time to consider it before the date for closure of submissions. That whole process within the select committee, for deliberating on the bill, was truncated by about a month. We have had a very different process here in Aotearoa New Zealand than that which has existed overseas in places like Canada, where there is much more extensive public consultation and public engagement on trade agreements.

It is the Green Party’s view that there should be a non-binding referendum on the TPP and that we should engage the public and not have the executive able to negotiate these agreements without actually having the Parliament even able to consider them and consider whether they should be signed. This bill is making changes to legislation. The Parliament has not had a chance to express itself, other than by the select committee report, on the actual agreement itself, and to veto the executive or engage in that debate there.

This is a noxious bill. As my colleague Barry Coates described, the Government has gone after it because it believes that the economic benefits from it are substantial, but the analysis that has been done has shown that it is within the margin of error in terms of any economic benefits within the normal flux of the economy. So it is not guaranteed to deliver the claimed benefits that the Government talks about.

One of the major disadvantages of the agreement, of course, is the investor-State dispute settlement provisions, because in this agreement, supposedly about trade, only six of its 27 chapters deal with tariffs. The bulk of it is actually dealing with investor rights, and it is those investor rights that will fetter the ability of the Government to actually pass legislation to protect New Zealand’s interests. The Government has gone into this talking about economic interests, but it has been prepared to put second the ability of the Parliament to regulate and the ability of the Parliament to legislate on behalf of all New Zealanders, because it is allowing, through these investor-State dispute settlement provisions, for private corporations to sue the Government, to pre-empt a judicial process, and to have huge corporations taking on our small Government.

Of the hundred largest economies, 50 are countries and 50 are corporations. New Zealand is 364th in that list. We are 54th amongst Governments. So when private corporations seek to sue the New Zealand Government, as companies like Chevron have done when the state of Quebec decided that it did not want any more gas fracking—the oil company Chevron sued the Canadian Government for almost $400 million. Similarly, in Ecuador, Chevron used the investor-State dispute settlement provisions to try to get out of a previous ruling that that Government had put in place to stop Chevron polluting the Ecuadorian environment.

So it is this undermining of national sovereignty, the undermining of the power of Parliament, that is at the heart of the Green Party’s opposition to this bill. The bill will allow foreign corporations to seek compensation from the Government if they see things like mining legislation, things like biodiversity standards, things like controls on land use to protect water quality undermining their rights and their investment certainty. It is going to have a chilling effect, potentially, on the Parliament.

One of the other major reasons for the Green Party’s opposition is the changes in the bill around the Overseas Investment Act in Part 7. Again, this is where the executive is giving itself the power to amend the threshold that triggers the Overseas Investment Office to look at private corporations seeking to purchase New Zealand companies and getting involved in the New Zealand economy. Under the TPPA, there is a requirement that the Government double the threshold from $100 million in the current legislation, which triggers the scrutiny of the Overseas Investment Office, to $200 million, but the bill, in Part 7, allows the Government to pass regulations to change that investment threshold at the say-so of the executive. So that is having subsidiary, secondary legislation power done through regulation rather than through primary legislation that is debated by the Parliament. That, again, is reducing the sovereignty of Parliament. It is reducing our ability to protect our economy against foreign investment.

One of the other major weak provisions of the bill is that we cannot extend the categorisation of assets and land holdings that are subject to the Overseas Investment Act. That means that there is no ability for the Parliament to ensure that foreign speculators who are speculating in urban residential property can be controlled through a change to the Overseas Investment Act. The bill prevents that from happening. It is keeping the classes of transactions that are subject to the scrutiny of the Overseas Investment Office—it restricts those to what is already in the legislation. Again, it is a chilling of Parliament’s ability, a restriction on our national sovereignty, and a putting of the interests of foreign corporations ahead of the ability of the Parliament to act on behalf of all New Zealanders, to act on behalf of our economy.

It is the foreign corporates that win under this bill. It is the view of masses of New Zealanders who made submissions on the agreement that they oppose this bill. We oppose this bill. We want our Parliament to have sovereignty. We want our Parliament to be able to act on behalf of all New Zealanders to protect our environment and to protect our economy against overseas speculation and investment, but this Government is set on undermining that so that foreign corporations are much more able to sue and pursue their interests. The Green Party is opposed to this bad bill.

JULIE ANNE GENTER (Green): I want to start my contribution to this debate by talking about values, what I in particular value and what the Green Party values, and why I stood for the Green Party. What we value is a world where our climate and our environment is protected for the long term, where people are able to have meaningful work and able to live happy, healthy lives—a world where there is peace. This is not unrealistic. This is something that we could create. With all of our knowledge and our technology, human civilisation should be able to achieve this.

Trade could and should be part of achieving this, of protecting our environment and protecting people and achieving a peaceful civilisation, but it currently is not. Why is that? It is because along with trade has been exploitation of natural environments and the exploitation of poor people, all for the benefit of some very wealthy investors. It will continue to happen this way if we do not stand up and say that we want a better world. I know that most New Zealanders agree with this and would like to live in a peaceful world, would like to protect our natural environment, and would like to live in a society where everyone has a fair go and we do not have increasing inequality.

But the National Government is letting us down, not only because its policies are not achieving this but because it is not even facilitating an open and frank debate about its policies. The Trans-Pacific Partnership agreement (TPPA)—we have not had a proper debate about this, and any time anyone raises significant concerns about the provisions in the TPPA and how they are going to make it more difficult for us to protect our natural environment, to protect the public health of our people, and even to protect the interests of taxpayers when it comes to the cost of medicines, we are accused of being anti-trade. Well, let me say, right here, right now: I have no problem with trade. We believe in trade. We want trade agreements that protect the things that matter most to us in this world, and that is our children’s future, that is the water that they should be able to swim in and drink, that is the air that they breathe, and that is the climate that we need to be looking after.

I know that those National Government members understand this, because their Government signed up and ratified the Paris Agreement. The Paris Agreement says we cannot keep doing business as usual. We have to change how we are doing things. Yet the TPPA is very much about protecting business as usual.

Our three main concerns about the provisions in the TPPA are: the ISDS clauses—that is, the investor-State dispute settlement provisions, which give investors the right and ability to sue Governments simply because they have legislated in the interests of protecting the environment or public health. That is the truth of how these ISDS clauses work—70 percent of all the ISDS cases that have been taken have been about environmental regulation, and there are countless examples of these. For example, when the German Government tried to phase out nuclear power after the Fukushima disaster in Japan, it got sued for NZ$6.2 billion by a Swedish nuclear energy company. When the state of Quebec decided it did not want any more gas fracking, Chevron Oil Co. sued the Canadian Government for almost $400 million. Chevron Oil Co. also used ISDS to sue Ecuador because Chevron was trying to get out of a previous ruling that said it owed billions of dollars to Ecuador for polluting the Ecuadorian environment.

Anyone who cares about protecting the environment in the long term will have concerns about the provisions in the TPPA that are, effectively, giving foreign investors the right to potentially sue future New Zealand Governments for regulating in the interests of protecting our environment. I have not heard a single National member stand up and give any defence of this.

It is not just the environment. If we care about public health and the ability of future Governments to pay for medicines, then we should be concerned about the copyright provisions in the TPPA that could affect the ability of Pharmac to negotiate affordable prices for medicines. In fact, National has already admitted—John Key has already admitted—that it will cost us more. Maybe it will not cost New Zealanders more when they go to pay for it at the pharmacy, but it will cost New Zealand taxpayers more because we are going to have to pay more for those medicines.

How is that in the interests of New Zealand? It is definitely in the interests of the big pharmaceutical companies in the United States. They are some of the most profitable companies in the world; their margins are incredible. I am not saying that we should not be looking to get a better deal for our exporters—we absolutely should—but what we have got in the TPPA is simply not worth the cost, the way this trade agreement has been written.

It is not just the Green Party that is raising concerns about this. The EU Trade Commissioner—who is in the middle of negotiating the Transatlantic Trade and Investment Partnership (TTIP), which is an Atlantic version of the TPPA—said “We want the rule of law, not the rule of lawyers.”, and is calling for ISDS reform. The Australian Productivity Commission, set up by John Howard, recently came out strongly against investor-State dispute clauses because of the unquantifiable financial risks to Governments. It said ISDS creates “potentially large unfunded contingent liabilities dependent on decisions by international arbitration tribunals.”, “substantive appeal rights available to foreigners not available to domestic firms, risk impeding domestic regulatory reform … lack transparency and have inadequate parliamentary scrutiny.”

So the concerns that the Green Party has are not about trade—let that be clear—we are concerned about the ability of New Zealanders to use their democratic right to regulate to protect in the interests of the environment and in the interests of public health. I think that is a perfectly legitimate concern to raise, and it is a debate that should have been had here in New Zealand. We should have been talking about that. Not everyone who raises concerns about the way this has been drafted should be castigated as being completely anti-trade or against jobs in New Zealand. I mean, honestly. In the Government’s own analysis it shows that the TPPA is likely to lead to a loss of jobs in New Zealand.

So again what we see here is a pattern. That pattern is that law is being made in the interests of the few, in the interests of the powerful, and in the interests of those who are already benefiting from the status quo. We know we want something different and something better, and we have every ability to create that for ourselves. So for all the young people out there in Aotearoa who want a peaceful world with a stable climate and a fair society, I say to you: you can make a difference. Get involved in politics. Get involved and help us create this fairer society and better world, because these people in power are not going to do it for us.

Hon TODD McCLAY (Minister of Trade): I thought I would take another call on the discussion and the debate so far. I want to start where I started in the first call so that, actually, New Zealanders will genuinely be enjoying this conversation and debate. Largely that is because quite a lot of the politics around the Trans-Pacific Partnership (TPP) that we have seen over the last year is not present in the Committee, and I think that is a good thing when it comes to talking about trade and trade policy and the importance of trade for all New Zealanders. So I am grateful to all members, on both sides of the Chamber, for the way the discussion and debate have been conducted so far. I pledge to ensure that it is not me who changes that with my comments at the moment.

I would say to Ms Genter that I largely agree with some of the sentiments she has made, maybe not all of the detail, but I do also agree with her that it is important that we find ways to make the case to New Zealanders. Certainly, the process that we have seen—the treaty examination and also the legislation—in as far as the Foreign Affairs, Defence and Trade Committee has been, I think, important. The committee has done a very good job. It did receive a lot of submissions and did its very best to allow submitters as much time as it was able to. Indeed, in the first roadshow that I held around the TPP in Auckland, where there was a very large turnout—it might have been the largest turnout of the 18-odd roadshows and hui that we did, not the largest group that I spoke to as part of the 50-plus events I did around the country, but of the formal roadshows and hui, that would have been the largest one.

Ms Kelsey, from the floor, raised her concern that she would not meet the deadline imposed by the committee for submissions. Indeed, that would be a concern, but it was not because the information—the document—had not been available. For the first time the Trans-Pacific Partnership agreement (TPPA) was released before the legal scrub has taken place, soon after it was agreed and long in advance of the signature. Often, with other agreements, we have released it to the House after signature, and, indeed, the rough text was released last year, and then I released the scrubbed text before signature. But I said to Ms Kelsey at the time that she should get in touch with the chair. There was all of this year to have this conversation with New Zealanders and through the House—this is a place for scrutiny. We heard soon afterwards—it was a decision of the committee, but it happily extended the period of time for her and some others to make submissions. So I want to compliment the committee for its approach to this. I think it has been mature and I think it has helped, certainly in the sense of the debate here today.

I want to touch on a couple of issues that members have raised, and because this is one debate on all parts and sections and we are coming to a vote, I will also speak about a couple of the Supplementary Order Papers (SOPs). I want to explain why I think some of them are not necessary but some of the things they are trying to achieve will already be achieved, or there is another way. The first thing I would say is that Mr Tirikatene spoke earlier about Wai 262 and his concerns there. The Government shares his concerns, and that is why under the TPP we are the only country that has an exclusion to be able to make decisions around Wai 262, or at least the International Union for the Protection of New Varieties of Plants (UPOV) agreement, and implement that outside of TPP. So all other nations have made commitments and are bound by those—many of them have already signed up to UPOV or have implemented them—but, in the case of New Zealand, we have carved out space for that internal domestic dialogue to take place in many areas, including with iwi, before decisions are made.

We have had to say with our partners that we will put things in place within 3 years. Actually, to Mr Tirikatene, I think that is probably a good thing because it does give emphasis and momentum to the necessity of having this conversation, but it is also 3 years after entry into force. So—roughly, three plus two—the Government has 5 years to work through this. That is an area, as with the Treaty exemption, where we carve out the right for the New Zealand Government, the Crown, to meet its obligations to iwi, to Māori. That is something that we take seriously.

In all agreements, for a very long period of time—in fact, there was a previous Labour Government quite some time ago that consulted widely on the Treaty of Waitangi exemption, and it has been in all trade agreements since then. But I would say to members that it is not just accepted by countries overseas that we have a right in New Zealand and must, therefore, have a right in our agreements to meet our obligations to iwi—we have to go and explain this and negotiate it. We have been successful so far all of the time, but we should not take for granted that all of those whom we negotiate with would merely accept that. We have to work very hard for it. I have had six meetings with the iwi leaders and their trade group this year to talk about the TPP and to talk about trade. I am committed to continuing that conversation with them as we go forward. I would say that the dialogue we are having, again, is working very well for both sides.

Around investor-State dispute settlement (ISDS), I agree with the European trade commissioner as she wants to look for reforms to ISDS. TPP is one of those reforms. As far as ISDS is concerned, it is the most advanced investor-State protection system that we have successfully negotiated. I accept that people have different views on this and will not all agree with me but this is the first one where we have openness, we have transparency, the public can see what happens, and we have carve-outs for the Government. So the first area is that no tobacco company can take a case against New Zealand under ISDS. Secondly, we reserve the right to pass law and regulation. Thirdly, where two parties of countries disagree that an ISDS case—if they believe an ISDS case would go against the spirit of what has been negotiated, those two countries can decide to not allow it to go forward, to dismiss it. But it is very open, it is very transparent, and in future agreements I think we will continue to look for ways to make this more open, more transparent, and better for us as we can. But the reason we do this is not to allow others to come here to New Zealand, take issue, and seek legal redress in some way, it is so that New Zealand investors overseas can have greater certainty. Not every country of the world respects its courts or its law in the same way that New Zealand does. It is important that our investors know that there is a framework they can work within.

Finally, just around the SOPs—and I will go through these fairly quickly because I do not want to take another call and deprive members of an opportunity. There are a number. The first is from Gareth Hughes, SOP 240 on fair use. Some submitters requested that we introduce a fair-use exemption as part of the select committee’s process of the bill, and I think this is to do with copyright. As the departmental report said: “TPPA does not require New Zealand to introduce a ‘fair use’ exception into the Copyright Act. The introduction of a fair use exception is best considered within the context of a wider review of the Copyright Act.” If that review takes place and happens, it would be allowed and it would actually impact upon TPP. So the place to do this—I have this conversation not as part of TPP, just those 11 other countries—is in any wider review of the Copyright Act, and we have the space there for if domestic legislation changes for that also to impact upon TPP.

The second one from Barry Coates—this is SOP 241—would create a discrepancy between exceptions for copyright and exceptions for performers’ rights in sound recordings. My view is that this would lead to confusion and additional compliance costs for people wanting to use the exception in this area.

The final one, SOP 242—also from Mr Coates—is around the overseas investment SOP. Clause 69 is the power that will enable the part of TPP relating to overseas investment to be implemented. New Zealand cannot be compliant with its TPP obligations unless regulations are made or a new bill is passed. So the regulation-making power under clause 69 is clear on its face as to the limits of the power and the purpose of that power. It is limited to the implementation of the obligations under the TPP. So to limit it to $200 million as a threshold for business assets acquisition, it does not speak to sensitive purchases or sensitive land and so on. For this reason the Government does not consider that it is necessary—sorry, we consider it is not inappropriate to delegate to the executive the power to make detailed regulations that we need to meet this obligation. But the draft regulations, as proposed to be made under clause 69, are already open for consultation—that has been called for by the Minister—and it is intended to allow transparency input from the public. The regulations, once decided, would be subject to the usual scrutiny and the other powers of the Regulations Review Committee. As Miss Genter said earlier, it does not allow the amount of that threshold to go up; that is set in the TPPA. It merely is around the rules of how to implement it. So it does not mean the Government can say “Let us double it or triple it.” It is only to allow us to implement obligations under TPPA, and that is at the rate of $200 million.

GARETH HUGHES (Green): Kia ora, Mr Chair. Ngā mihi nui ki a koutou, kia ora. You really know what grinds my gears? It is that Minister talking about, and I quote him, “openness”, “transparency”, and “we are having a conversation.” A conversation, after the thing has been negotiated; a conversation, openness, and transparency, after the thing has been decided. That Minister came down to this Chamber and said “What are you moaning about? You’ve had 50 roadshow meetings.”, after the thing was decided. He said to MPs and unions “You’ve had access to negotiators.”, after the negotiations had finished. You cannot have a conversation with someone who cannot budge, who will not budge.

This has been a terrible process, and here is the Minister trying to defend it by saying that it has all been about openness, transparency, and a conversation. That is absolutely ridiculous. This has been a secret process throughout a number of years. The only way citizens, unionists, businesses, and NGOs could find out information about what his team was negotiating was through WikiLeaks. That is not openness. That is not transparency. That is not a conversation. That is being dictated to.

This is a bad bill, which the Green Party will not be supporting. The Minister was talking about my amendment, and I want to touch on this. My amendment: a positive amendment for fair use. Under this legislation, we are being forced—

The CHAIRPERSON (Lindsay Tisch): Order! The member’s Supplementary Order Paper 240 is out of order. It is out of scope. I know you have been informed of that. So if could you confine your comments, as you have already started, to other substantive matters, but your Supplementary Order Paper (SOP) is out of order. I will be ruling it out of order when we come to have the vote, and you cannot talk about it because it is out of scope of the bill.

GARETH HUGHES: I raise a point of order, Mr Chairperson. I just seek clarification. I am aware of that fact, but why was the Minister not required, on mentioning my SOP—

The CHAIRPERSON (Lindsay Tisch): No, well, he actually just commented on your SOP. You are the one who is now speaking to it, and I am telling you now that it is out of scope. There are some very small technical agreements that are in scope, those required to implement the Trans-Pacific Partnership agreement (TPPA), but your amendment seeks to extend the copyright provisions to mirror American provisions. I know that you have been informed that it is out of scope. I am telling you that I will be ruling it out of scope when the vote comes, but I am also saying now that you cannot talk to it, because it is out of scope.

GARETH HUGHES: So under this legislation, under the copyright provisions of Part 2 of the Trans-Pacific Partnership Agreement Amendment Bill, New Zealand is forced to enact US-style copyright rules, US-style copyright term extensions. This legislation is all about New Zealanders facing US costs, with none of the US benefits that US citizens can access, such as modern copyright legislation. Because, currently, what this legislation does is keep our 1994 Copyright Act stuck in the past, stuck in the pre-internet age where it was written, in the early 1990s.

Under this legislation, New Zealand copyright has been moved towards the balance of rights holders. Everyone involved in the copyright debate, in New Zealand and around the world, agrees we need balance when it comes to copyright. However, what this bill does, in Part 2, is put all the balance on one side: on the rights holders’ side. When we see the impact this has on New Zealanders—I researched the impact it is going to have on New Zealand music and New Zealand literature, which would be coming out of copyright, but because this Government is extending terms along the US lines, with none of the corresponding US benefits or protections. We are going to see some iconic New Zealand literature such as New Zealand’s first gay novel, some incredibly famous music such as the song of the century, Fourmyula’s “Nature”, stay locked out of the public domain, which means New Zealanders cannot access it. We cannot have a richer creative public space, because it is being locked away.

This is exactly what we see in this legislation, which is all about balance that is tilted towards one side, which is the corporate interest, not the public interest. That is why we should be having the conversation. If we are having US costs, why can we not have US protections? This was a key message we saw in the select committee process. Although we are criticising the process that sees us at this point—which was the secrecy, being consulted on and engaged with only after nothing could change—we saw that exactly in the select committee process, which went through a very constrained time line and did not listen to the people.

Here we are in Parliament, racing ahead, passing a law literally on the eve of the US election where both major candidates have said they will not be supporting this legislation. New Zealand is racing ahead. It is disappointing that we cannot access those protections that other citizens can. The Green Party is going to continue to push for it, because as we had the copyright conversation we should be talking about balance, not just costs for New Zealanders, which we know have been estimated to be in the order of $55 million a year. Thank you.

BARRY COATES (Green): Tēnā koe, Mr Chair. I would like to speak to Supplementary Order Paper 242 on the foreign investment provisions of the Trans-Pacific Partnership Agreement Amendment Bill. This Supplementary Order Paper proposes the deletion of clause 69. Clause 69 would insert a new section 61A, and that section would give powers to the executive that we believe should be reserved for Parliament. What it does, basically, is it takes away the powers of Parliament to determine the rules around foreign investment regulation. I think this is a particularly problematic part of the Trans-Pacific Partnership Agreement Amendment Bill. As previous speakers from the Green Party have discussed, the Green Party does not agree with the ratification of the Trans-Pacific Partnership agreement (TPPA) as a whole, but even if it went through we would be deeply worried at the loss of democratic and parliamentary scrutiny over the important issue of regulation of foreign investment.

There is, as members of the public and members of the House know, considerable public interest in Government approval of foreign investment, and growing public concern about foreign investment of New Zealand’s iconic landscapes, of agricultural land or primary production, of value chains, and of strategic assets. The foreign ownership of New Zealand’s assets is increasing, although we would decry the lack of proper analysis and a database to show that clearly. We believe it is wrong for democratic oversight of that investment to be taken away from parliamentary scrutiny under this amendment, so this Supplementary Order Paper proposes to delete the amendment that would remove these parliamentary powers.

Let us look at why we might want to have public and parliamentary scrutiny maintained over foreign investment in New Zealand. Members of the public know that there has been deep concern over foreign purchase of residential homes, for example. The right to restrict foreign investors from purchasing New Zealand residential homes would be, essentially, ruled out under the TPPA.

But there are many other aspects of foreign investors that give rise to concern. The journalist Rod Oram wrote, in an expert paper analysing the TPPA, about the loss of control of agricultural value chains. The problem is that if we cede control over value chains in, for example, infant formula to foreign investment and foreign ownership, then, essentially, New Zealand producers get locked into the role of low-value commodity production, without the means of owning the full value chain and without the ability to be able to strategically direct New Zealand’s future in agriculture value chains. This is a recipe for New Zealand to be locked into a low-value commodity - producing role in the economy.

There are many other reasons why foreign investment may want to be restricted. For example, in the episode when schedule 4 of the Crown Minerals Act was threatened to be opened up by the Government, there was concern from industry that that would be restricting foreign investment. Industry said that the value that was locked up was $200 billion—a figure then repeated by the New Zealand Government. So the “locking up”, so to speak, of mining assets that are, in fact, on conservation land could be the subject of challenges from foreign investors on the basis that it would restrict their access to New Zealand’s resources. That is exactly the kind of restriction that we think the New Zealand public needs to have a voice on to ensure—[Bell rung] Mr Speaker. Thank you—sorry, Mr Chair.

There have been debates also over strategic assets such as Auckland Airport. There is public concern over the use of New Zealand’s groundwater. There is public concern over the sale of agricultural land and iconic places. What we are seeing internationally is that agreements like the TPPA, which introduce a mechanism such as investor-State dispute settlement (ISDS), open up decisions of Government to challenge in an international arbitration panel that has shockingly bad judicial process. That is very dangerous, because these decisions are being decided above Parliament. They are being decided above New Zealand’s judiciary system. We are opening ourselves up to key issues that affect the functioning of democracy being decided in an international tribunal that can override our democratic processes.

We look at some of the international cases. Some of them have mentioned by my colleagues, but they have not talked about the most recent case, where President Obama’s Government is being sued over the Keystone XL pipeline carrying oil from tar sands off Alberta. It is being sued by TransCanada for US$15 billion. So we see the size of some of these agreements. We know that, for example, Occidental Petroleum took the Ecuadorean Government to ISDS and was awarded $2.3 billion over oil drilling in lands sensitive both for indigenous peoples and for ecological fragility. We have seen the case where Quebec is being sued by the US company Lone Pine Resources for $250 million over its moratorium on fracking. Because Quebec wanted to do further research on the implications of fracking on geology and the groundwater, it was sued under ISDS for $250 million. These are the kinds of cases that New Zealand may well face under ISDS.

We have heard previously that these cases have not yet occurred for New Zealand under agreements that we have already signed, but the agreements that we have signed are with countries that are not nearly as litigious as the corporations from the countries we are about to sign the TPPA with. For example, I do not think Brunei’s corporations are about to take New Zealand to ISDS, but the US corporations have been highly litigious in using mechanisms like ISDS to take countries like Canada to an international tribunal. Therefore, under the TPPA we would not only be losing parliamentary oversight of foreign investment decisions, and not only be delegating that to the Governor-General by Order in Council—which is a key loss of parliamentary scrutiny—but we would then be opening ourselves up to challenge by multinational corporations over decisions that were taken by this Parliament, which could potentially cost New Zealand an enormous amount of money.

I think what we have seen from the New Zealand public is a very loud “No” to this agreement. The most credible public opinion poll, in November last year, said that 60 percent of people who have an opinion on the TPPA reject the TPPA. That is 60 percent of the New Zealand public. People have been asking for a referendum on this agreement. This is a vitally important agreement for New Zealand’s sovereignty. It is a vitally important agreement for our economic future, for our right to regulate. I would say to Minister McClay that when he says that the right to regulate is protected, he should read out the whole sentence, which says: “We reserve the right to regulate, except where it is inconsistent with this agreement.” It is this kind of skating over the reality of this agreement that we have seen far too much of. I would say that this agreement should be rejected. The Green Party rejects it.

The question was put that the amendment set out on Supplementary Order Paper 239 in the name of the Hon Todd McClay to delete Part 1 be agreed to.

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

Ayes 92

New Zealand National 59; New Zealand Labour 31; ACT New Zealand 1; United Future 1.

Noes 28

Green Party 14; New Zealand First 12; Māori Party 2.

Amendment agreed to.

Part 1 not agreed to.

The CHAIRPERSON (Lindsay Tisch): We now move to Part 2, and we have Gareth Hughes’ amendment as set out on Supplementary Order Paper 240. This is out of order, as being outside the scope of the bill.

The question was put that the amendments set out on Supplementary Order Paper 241 in the name of Barry Coates to clause 28 be agreed to.

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

Ayes 57

New Zealand Labour 31; Green Party 14; New Zealand First 12.

Noes 63

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

Amendments not agreed to.

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

Ayes 61

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

Noes 59

New Zealand Labour 31; Green Party 14; New Zealand First 12; Māori Party 2.

Part 2 agreed to.

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

Ayes 61

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

Noes 59

New Zealand Labour 31; Green Party 14; New Zealand First 12; Māori Party 2.

Part 3 agreed to.

The CHAIRPERSON (Lindsay Tisch): We move to Part 4, and the question is that Part 4 stand part. Those of that opinion will say “Aye”, to the contrary, “No”. The Ayes have it. The—

Fletcher Tabuteau: Party vote.

The CHAIRPERSON (Lindsay Tisch): All right, a party vote is called for. If you want a party vote, you must call for one. It does not automatically happen.

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

Ayes 61

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

Noes 59

New Zealand Labour 31; Green Party 14; New Zealand First 12; Māori Party 2.

Part 4 agreed to.

A party vote was called for on the question, That Part 5 be agreed to.

Ayes 61

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

Noes 59

New Zealand Labour 31; Green Party 14; New Zealand First 12; Māori Party 2.

Part 5 agreed to.

A party vote was called for on the question, That Part 6 be agreed to.

Ayes 61

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

Noes 59

New Zealand Labour 31; Green Party 14; New Zealand First 12; Māori Party 2.

Part 6 agreed to.

The question was put that the amendment set out on Supplementary Order Paper 242 in the name of Barry Coates to clause 69 be agreed to.

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

Ayes 57

New Zealand Labour 31; 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.

A party vote was called for on the question, That Part 7 be agreed to.

Ayes 61

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

Noes 59

New Zealand Labour 31; Green Party 14; New Zealand First 12; Māori Party 2.

Part 7 agreed to.

A party vote was called for on the question, That Part 8 be agreed to.

Ayes 61

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

Noes 59

New Zealand Labour 31; Green Party 14; New Zealand First 12; Māori Party 2.

Part 8 agreed to.

A party vote was called for on the question, That Part 9 be agreed to.

Ayes 61

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

Noes 59

New Zealand Labour 31; Green Party 14; New Zealand First 12; Māori Party 2.

Part 9 agreed to.

A party vote was called for on the question, That Part 10 be agreed to.

Ayes 61

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

Noes 59

New Zealand Labour 31; Green Party 14; New Zealand First 12; Māori Party 2.

Part 10 agreed to.

A party vote was called for on the question, That Part 11 be agreed to.

Ayes 61

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

Noes 59

New Zealand Labour 31; Green Party 14; New Zealand First 12; Māori Party 2.

Part 11 agreed to.

A party vote was called for on the question, That Part 12 be agreed to.

Ayes 61

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

Noes 59

New Zealand Labour 31; Green Party 14; New Zealand First 12; Māori Party 2.

Part 12 agreed to.

The question was put that the amendment set out on Supplementary Order Paper 239 in the name of the Hon Todd McClay to delete schedule 1 be agreed to.

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

Ayes 92

New Zealand National 59; New Zealand Labour 31; ACT New Zealand 1; United Future 1.

Noes 28

Green Party 14; New Zealand First 12; Māori Party 2.

Amendment agreed to.

Schedule 1 not agreed to.

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

Ayes 61

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

Noes 59

New Zealand Labour 31; Green Party 14; New Zealand First 12; Māori Party 2.

Schedule 2 agreed to.

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

Ayes 61

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

Noes 59

New Zealand Labour 31; Green Party 14; New Zealand First 12; Māori Party 2.

Schedule 3 agreed to.

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

Ayes 61

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

Noes 59

New Zealand Labour 31; Green Party 14; New Zealand First 12; Māori Party 2.

Schedule 4 agreed to.

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

Ayes 61

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

Noes 59

New Zealand Labour 31; Green Party 14; New Zealand First 12; Māori Party 2.

Clause 1 agreed to.

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

Ayes 61

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

Noes 59

New Zealand Labour 31; Green Party 14; New Zealand First 12; Māori Party 2.

Clause 2 agreed to.

House resumed.

Bill reported with amendment.

The CHAIRPERSON (Lindsay Tisch): I move, That the report be adopted.

A party vote was called for on the question, That the report be adopted.

Ayes 61

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

Noes 59

New Zealand Labour 31; Green Party 14; New Zealand First 12; Māori Party 2.

Report adopted.

Bills

Civil Defence Emergency Management Amendment Bill

Third Reading

Hon NICKY WAGNER (Minister of Customs) on behalf of the Minister of Civil Defence: I move, That the Civil Defence Emergency Management Amendment Bill be now read a third time. This bill was introduced in November 2015. I would like to start by acknowledging the Hon Nikki Kaye. She was the one who developed this bill and did a huge amount of work towards it, and I am sure she would have liked to be here today for its final debate. Before I start, I would like to thank parties across the House for their support of this bill. I would particularly like to thank the Government Administration Committee, chaired by the Hon Ruth Dyson, and all the members of that committee for their work on this bill. There were a number of changes recommended by the committee that have, I think, strengthened the bill.

The bill recognises that more legislative tools are required to enable communities to recover from emergencies more efficiently and more effectively. The bill meets this need, particularly in regard to small and medium events, and, of course, these are the most frequent events and emergencies that we experience in New Zealand. But the bill is not limited to small and medium types of emergencies, and can be used on a large-scale emergency—although, hopefully, we will not need it—until any bespoke legislation is created.

The bill sends a clear signal that planning for recovery is important, as historically the focus has been on preparing and responding to an emergency. Planning, of course, is extremely important, and it is only with good plans that we can underpin good recovery.

To summarise the key provisions, I believe that they significantly support local communities. Firstly, the bill provides for local civil defence emergency management groups, made out of local councils, to initiate formal transition periods. During these times, group recovery managers, on behalf of the community, have access to powers designed to assist the recovery phase. These powers include things like the ability to close roads, the ability to keep areas clear of the public, and the ability to carry out any necessary works.

Secondly, the bill emphasises the need for civil defence emergency management groups and their communities to discuss and plan for recovery. Of course, planning for recovery should always occur prior to an emergency, and communities need to be part of that planning conversation. The planning for recovery requirements were strengthened during the Committee of the whole House debate by an amendment by Clare Curran, and that was supported by all, so I thank Clare Curran for that. The bill now provides that civil defence emergency management group plans must include strategic recovery planning. That makes it expressly clear that planning for recovery must be undertaken.

There are also additional supporting provisions, such as the ability for the Minister of Civil Defence to become involved if local communities lack capacity. Transition periods can also be initiated at a national level.

The next steps: once the bill has been passed, the Ministry of Civil Defence and Emergency Management will actively support the implementation of the bill and work with local groups and communities to make the most of its provisions, in both planning for and responding to recovery activities.

Finally, I would like to thank all of those who have been involved in the development of this bill. It is a sensible approach. It is focused on increasing community resilience and on speeding up recovery after an emergency. It puts more tools in the tool kit for local communities and the Government, and I commend this bill to the House.

CLARE CURRAN (Labour—Dunedin South): It is a pleasure to speak in the third reading of this bill, the Civil Defence Emergency Management Amendment Bill. I too would like to acknowledge the Hon Nikki Kaye and her work in this area and in general in civil defence, and the work of the Government Administration Committee. I also want to acknowledge the good work of the officials and the Parliamentary Counsel Office. There was good work. I do not say that every time I get up to speak on a bill, but there was good work done. I think that the bill is better for it, and the New Zealand public listening or watching tonight can be a little bit more reassured that New Zealand is more prepared for emergencies and for the recovery phase in emergencies. It was a very good committee.

I am going to give a very short recap of the key elements of the bill and how we approached the bill on this side of the House in the Labour Party. We supported the intent of the bill, right from the beginning, which was to improve the way that communities recover from emergencies and for there to be a seamless and timely transition from response to recovery. Of course, that is a no-brainer, but we did end up with some concerns during the select committee process, when the bill came to the Government Administration Committee. Largely, those were concerns focused around the balance between ministerial powers and consultation with communities, and the ability for local governance to be able to exercise decision making without being overridden by ministerial powers, and around how that communication could work better. I think that the bill is better for the work that was done in the committee on that.

We also noted that the bill is the first stage of a wider review being undertaken into the legislative framework in this whole area for recovery. This bill focuses on small to medium sized events, and I do not want to diminish the importance of those, because they still have huge impact in the communities that they affect. Every year there are several events that occur in different communities around our country that have lasting impacts, and this bill will make dealing with them and recovering from them better. But this bill does not address the bigger events and the work that we need to do around that. My message tonight to the Government is that we need to hurry up and get that process started, and to ask how that engagement with the community happens—engagement right across the community with all of the important stakeholders.

I really do urge the Government to give us a bit more detail about that. I know that during the Committee stage the Acting Minister, Gerry Brownlee, gave us a little bit of a clue and said some positive things about that, so our ears are open. We are ready to have discussions on that and to ensure that all of our communities are.

We did retain some concerns about the bill when it came back from the select committee to the House, and we proposed a Supplementary Order Paper (SOP), which the Government supported, as did all the other parties. It was generally a good decision and a good agreement. That SOP required the National Civil Defence Emergency Management Plan prepared by a civil defence emergency management group to state and provide for strategic recovery planning. This was originally in the bill at the first reading, and then it got taken out during the discussions at the select committee on the recommendations of officials. We have put it back in again. Although it is not specific about what those strategic recovery plans should include, it is there as a strong signal, and we believe that is important.

Basically, there were other matters that we discussed a lot in the select committee—the inclusion of a permanent legislative authority, which we described as a sensible mechanism after having heard from Treasury about how that works in other areas. It is a flexible mechanism for reimbursement of expenses during an emergency and for providing ongoing authority for such expenditure.

We are pretty happy with this bill. I want to make a couple of observations, and I know that I will not get through, I am sure, all of them before the end. There is more work to be done, and, as I said, we hope that that engagement will begin soon as to how the next phase of this work will occur. Right around the country, there are 16 civil defence emergency management groups. There is work to be done in ensuring that they are fit for purpose. This is not to be critical of them individually, but the world is changing. The way that our New Zealand communities operate has changed. The old style of civil defence emergency management, where in some areas that turned into personal fiefdoms, has changed.

It is absolutely critical that every single one of those 16 civil defence emergency management groups is modern, that they have quality people, the relationships and the networks that they have—that there are living plans and not just plans that have been written and then put on the shelf, because this is about more than words on paper, that those living plans are tested and retested, that there is the utmost professionalism, and that they have the resources that they need when things go pear-shaped.

Debate interrupted.

The House adjourned at 10 p.m.