Wednesday, 8 March 2017

WEDNESDAY, 8 MARCH 2017

WEDNESDAY, 8 MARCH 2017

Mr Speaker took the Chair at 2 p.m.

Prayers.

Visitors

Malaysia—Delegates, Sabah State Legislative Assembly

Mr SPEAKER: Honourable members, I am sure that members would wish to welcome Yang Berhormat Datuk Haji Ahmad Bujang and other delegates from the Sabah State Legislative Assembly of Malaysia, who are present in the gallery.

Oral Questions

Questions to Ministers

Pay Equity—Joint Working Group on Pay Equity Principles and Government Response

1. METIRIA TUREI (Co-Leader—Green) to the Minister for Women: When she said that she was “fully equipped to kinda leap in and tackle” the challenge of pay equity, why is she ruling out a law change to shrink the pay gap in the private sector?

Hon PAULA BENNETT (Minister for Women): Can I start by wishing the member a happy International Women’s Day. To be clear, I am not ruling out legislation. In fact, the Government is drafting legislation to implement the principles of the pay equity working group as we speak.

Metiria Turei: When she said that businesses should do gender pay gap audits and publish the results, why will she not make that happen with a simple law change?

Hon PAULA BENNETT: Because I do not believe that the Government is the answer to everything, and I believe that businesses that, perhaps, think that they do not have a gender pay gap should look at doing an audit and publish that if that is what they believe. But I think that we can educate. We can show them ways that they can close that gap. We can actually lead the way in the Public Service, which is what we did by publishing our own data last year, by department, and that is what we stand for.

Metiria Turei: Does the Minister agree with the Human Resources Institute’s chief executive who said that “gender pay audits are absolutely the right thing for organisations to do”; if so, will she now adopt the Green Party’s bill that will make that happen?

Hon PAULA BENNETT: To the first part of the question, yes, I do, and I think that that certainly is to say we have done it within the Public Service. I think what it did was really point to areas that needed improvement, and we are now able to put those processes in place. To the second one, well, that would be a decision for caucus. It will go to them in due course.

Metiria Turei: Given that the pay-gender audits in the public sector have helped to close the gap by half a percent this year, why will she not now make this change in the private sector so that all working women will benefit?

Hon PAULA BENNETT: As I have stated already, because I do not think that, at this stage, legislation is the answer. I think that publishing the data yesterday for the first time in 14 years actually gets the right information out there that has not been—because I think a lot of people think that there is not a gender pay gap and this research proves that there actually is. We have got ways that we can close it that are not legislative, and that is what we are pushing to do.

Metiria Turei: Given the law requires that she is paid the same as her male colleagues, why will she not afford other New Zealand women that same legal protection from bias?

Hon PAULA BENNETT: We have the Equal Pay Act, and, as such, as you know, they should not be discriminated against by gender. It is the same for them as it is for us in Parliament, and that is what we expect of our businesses.

David Seymour: I raise a point of order, Mr Speaker. I seek your guidance in respect of Speaker’s ruling 18/1, which refers to members wearing T-shirts and, in particular, T-shirts with motifs on them in the House, such as Metiria Turei is currently wearing.

Mr SPEAKER: Certainly, I have not had a good look at the attire the member is wearing, but it is a requirement that business attire is worn. I will watch it fairly carefully from now on.

Metiria Turei: When the Minister knows that Māori women are paid 22 percent less and Pasifika women 26 percent less than men for the same work, why will she not act to help these women get fair pay?

Hon PAULA BENNETT: We are acting—and that is the joint working group principles that are now being turned into legislation. Through that, though, we made an announcement about a week ago that we would actually be using those principles to work through two other cases that are before us that actually do affect, particularly, Māori and Pasifika women who are in low-paid work. We are committed to seeing equity in that area. We have been working in good faith, and I have confidence, actually, that those negotiations will come to conclusion at some stage.

Rt Hon Winston Peters: If, as the Minister says, she is “fully equipped to kinda leap in and tackle”, after 9 years, exactly what has she done with the huge 47,000 Public Service disparity under her administration, and when will she stop blaming business and set an example herself?

Mr SPEAKER: Order! There are two questions there. [Interruption] Order!

Hon PAULA BENNETT: I am actually really pleased to have that question from the member. So what we have done is increased the number of women in senior leadership roles within the Public Service. That is now at 45 percent. So 45 percent of senior leadership roles within the Public Service are now filled by women. We have set up a diversity and senior leadership promotional so they know what the paths are and the career paths and how they can get those promotions. The number of chief executives is higher under this Government—female chief executives—than it has been under any Government ever, and that is something that we are committed to. We have equally transparently put out there, by department, what the Public Service gender pay gap is. We have now done unconscious bias screening—

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. I asked a specific question. It was a very long answer. The question—

Mr SPEAKER: Order! [Interruption] Order! The member will resume his seat immediately. It was not a specific question; it was quite a long question and it has been addressed. [Interruption] Order!

METIRIA TUREI: Now that she has said that pay equity is one of her main priorities, does that mean she will finally make an offer in the pay negotiations to the 50,000 women like Kristine Bartlett who are waiting for the Government for fair pay?

Hon PAULA BENNETT: Actually, those negotiations are confidential, and the member would not know whether an offer had been made or not.

Metiria Turei: I seek leave for Jan Logie’s Equal Pay Amendment Bill to be set down as members’ order of the day No. 1 on the next members’ day.

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

Government Financial Position—Surplus, Spending, and Government Contributions to Superannuation Fund

2. MAUREEN PUGH (National) to the Minister of Finance: What progress is the Government making on keeping the Crown accounts in surplus?

Hon STEVEN JOYCE (Minister of Finance): The Government’s operating balance before gains and losses results announced yesterday for the 7 months to January 2017 showed the Crown accounts $1.1 billion in surplus year to date compared with Treasury’s Budget forecast of $517 million for those 7 months. Although these year-to-date figures can move around and Budget 2016 forecast only a small surplus for the full financial year, it does show the benefits of the Government’s continued discipline and focus on balancing the books, and the strength of the New Zealand economy.

Maureen Pugh: What is driving this better-than-expected result in the Crown accounts for this financial year?

Hon STEVEN JOYCE: Stronger tax revenues, as a result of a healthier economy, are flying through to the Government’s financial performance. Tax revenues year to date are just under 4 percent more than they were predicted to be in Budget 2016. Company tax, in particular, is higher than expected, and that reflects the good performance of New Zealand companies in what is still an uncertain world. It is important to note, however, that the full impact of the Kaikōura earthquake remains the largest unknown variable in this year’s accounts, but these stronger accounts mean we can afford to step in and help those communities and support them when they are most in need.

Maureen Pugh: If those drivers of stronger tax revenues persist, what would be the Government’s best use of an additional $1 billion?

Hon STEVEN JOYCE: Let us not count our chickens. The Government has four key areas in mind when considering its Budget priorities for this year: firstly, providing better public services for a growing country, which needs to be met through a combination of additional funding and productivity improvements; secondly, of course, building the infrastructure we need to support a growing modern economy; thirdly, paying down debt so it is around 20 percent of GDP by 2020, which will allow us to manage any further shocks that come along in the future; and, finally, it is very important to consider the tax burden on Kiwi families, particularly on lower- and middle-income families that face quite high marginal tax rates.

Grant Robertson: In light of that answer, can the Minister confirm tax cuts are a higher priority for him than restarting contributions to the New Zealand Superannuation Fund?

Hon STEVEN JOYCE: The Government has said that it will look to resume contributions to the New Zealand Superannuation Fund when net debt is down below 20 percent of GDP, but, actually, yes, we are very focused on supporting New Zealanders. The member might want to go out and say that he would rather put money into the Superannuation Fund than consider the tax situation for families in New Zealand. I invite him to continue doing that.

Maureen Pugh: What other uses for additional spending has the Government considered?

Hon STEVEN JOYCE: We have considered a range of things. In fact, I have seen proposals from other groups this week that the Government should pay more money into the New Zealand Superannuation Fund, even during the global financial crisis, in fact, when we were borrowing heavily to support New Zealand families. However, even if the Government had borrowed an extra $13.5 billion, as was advocated by some, to continue contributions through the global financial crisis and the Canterbury earthquake recovery, the Superannuation Fund would still be contributing only an additional $1.4 billion in 2041. That would leave the proponents of this idea short $2.6 billion in 2041 alone. Unfortunately, this idea does not stack up for a number of reasons, including financial.

Rt Hon Winston Peters: If borrowing to make contributions to the Cullen, or Superannuation, Fund is bad economics, why was borrowing to give tax cuts to his mates good economics?

Hon STEVEN JOYCE: With the greatest respect to the member, his short-term memory must not be as good as his long-term memory, because we did not.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. I do not intend to put up with insults like that. My question was direct. I did not impute anything to him, and he gets up and starts with a very wanton, nasty comment, which you and I know will surely lead to disorder.

Mr SPEAKER: I think the member makes a reasonable point on this occasion. Such a start to an answer will lead to disorder, as has been demonstrated. Would the Minister now please address the question that was asked.

Hon STEVEN JOYCE: Mr Speaker, happily. The member is obviously mistaken in this instance because, actually, the tax changes we made in 2010 involved making changes where the GST was increased and personal taxes were reduced. There was not a case where we were borrowing money for tax cuts.

Housing, Wellington—Supply and Affordability

3. ANDREW LITTLE (Leader of the Opposition) to the Prime Minister: Does he stand by his statement that the shortage of rental housing in Wellington is “a problem of success”?

Rt Hon BILL ENGLISH (Prime Minister): Yes, I stand by my full statement, which went on to say that the demand for Wellington rental housing was “certainly concerning for people who are looking for accommodation.” I also stand by the statements made by the Mayor of Wellington, “It’s encouraging to see the building of new homes is beginning to kick into gear.”, and, secondly: “For the last 2 years, growth in new consents has lagged behind our targets, but this year we are in a very strong position and tracking very well.” He said that by working with central Government to make it easier to build new homes, we are helping to address the lack of supply. That was the Mayor of Wellington.

Andrew Little: Putting aside the fine achievements of the Mayor of Wellington, when Andrew German, a student, has been looking for a flat since November without success, is the Prime Minister seriously telling him that not having a place to live when he studies is a problem of success?

Rt Hon BILL ENGLISH: As I said, the pressure on rental housing is certainly concerning for people who are looking for accommodation, but I could only repeat the positive statements of the Mayor of Wellington: “It’s encouraging to see the building of new homes is beginning to kick into another gear.” By working with central government—and that is through mechanisms like the special housing areas, the changes to the National Policy Statement on Urban Development—the Mayor says we are making it easier to build new homes, we are helping to address the lack of supply.

Andrew Little: Putting aside the fact that there is no special housing area at the top of Willis Street in Wellington, when couple Nicola Kellerman and Tim Hunter say “The house prices are just so phenomenal. It’s just crazy.”, is he seriously telling them that not being able to buy a place to raise their daughter is a problem of success?

Rt Hon BILL ENGLISH: I can only repeat the comments that I have already made, and that is that pressure for that family is of course concerning, but the Government is working with the council, as the Mayor has outlined, and, as he says himself, we are helping to address the lack of supply. There is a whole range of mechanisms in place by which the Government is working with councils to address the need for more supply.

Mr SPEAKER: Supplementary question—[Interruption] Order! [Interruption] Order! Mr Brownlee.

Andrew Little: When an 84-year-old gentleman has been paying $120 a week to sleep in an old shed in Henderson, is the Prime Minister seriously telling him that spending his twilight years in such conditions is a problem of success?

Rt Hon BILL ENGLISH: If there is any individual in housing that is obviously of very poor quality and unsuitable for them, they have the opportunity, for instance, to approach the Ministry of Social Development and be placed in the new Luke Street—[Interruption]

Mr SPEAKER: Order! The level of interjection means that it is impossible for the rest of the House to hear the answer now. Some members may not be interested in the answer, but show respect for the others who do want to listen to the answer.

Rt Hon BILL ENGLISH: It may be suitable for him to be placed in a new Luke Street house, a group of several dozen new houses built just since October when the site first became available, into which three or four families have already moved—a small part of the $300 million programme across New Zealand that will supply over 8,000 places for people in emergency housing need, and that has never been done before in New Zealand.

Andrew Little: When he says that success is students who cannot find a flat, young couples who cannot buy a home, and our elderly being forced to sleep in sheds, does not that just show how out of touch he is?

Rt Hon BILL ENGLISH: No. As I have just pointed out, the Government has $300 million expenditure on emergency housing, which is now beginning to roll out and will supply places for 8,000 people. I might say that when that party was in Government in the early 2000s when there were house price increases, it did not do anything to deal with the pressures of emergency housing, which is why this Government had to create a whole new system for it. But I must say it is pleasing to see that Wellington, after a period of relatively low growth, is now an attractive place to live, and I think we should be proud and the city should be proud of the demand for housing going on in the city.

Andrew Little: Which of Nick Smith’s so-called successes is he most proud of: building fewer houses than we did 12 years ago, falling building consents, selling off State houses during a housing crisis, the lowest homeownership in 66 years, the fourth most unaffordable city in the world, or foreign speculators buying more of our houses than ever before?

Rt Hon BILL ENGLISH: Dr Smith, along with the rest of the Government, is very pleased to see a consistently growing economy that is lifting incomes and has reversed the major outflow of New Zealanders to Australia, which is the single biggest thing that has changed in our housing market. Five years ago 40,000 New Zealanders per year were leaving this country; last year it was a net inflow of 2,000. That is the single biggest change in the housing market and Dr Smith, along with the Government, has introduced a whole range of measures from special housing areas, HomeStart grants, the National Policy Statement on Urban Development, Resource Management Act reforms, most recently the $1 billion Housing Infrastructure Fund—

Mr SPEAKER: Bring the answer to a conclusion.

Rt Hon BILL ENGLISH: —into which Wellington City Council has every right to bid if it wants help with its supply of housing.

Andrew Little: Is this not the truth—that with plunging homeownership, skyrocketing rents, and homelessness at unprecedented levels, what he calls a problem of success is actually a failure of leadership?

Rt Hon BILL ENGLISH: No, because those assertions are wrong. The focus of activity right now is that councils—because, remember, councils govern all the supply of housing. If they want to bring forward housing supply they can bid into the $1 billion infrastructure fund, and currently intensive negotiations are going on between central government and councils testing their capacity and willingness to bring forward housing supply as they have said they want to.

Justice Sector Fund—Initiatives

4. SARAH DOWIE (National—Invercargill) to the Minister of Justice: What recent announcements has she made about justice sector investment?

Hon AMY ADAMS (Minister of Justice): Today I announced that the justice sector has allocated $257 million of savings since 2012 into justice sector initiatives. The Justice Sector Fund enables underspends across all justice sector agencies to be retained and reused to fund projects that support the reduction of crime, and allows agencies to trial new initiatives that deliver better results for New Zealanders. Since 2012, 60 initiatives across the five justice sector agencies have been funded. Once the initiatives have shown that they are effective, they are then able to seek long-term funding through the annual Budget process.

Sarah Dowie: What are some of the key initiatives that have been funded by the Justice Sector Fund?

Hon AMY ADAMS: The initiatives funded by the Justice Sector Fund since 2012 include a suite of family violence initiatives totalling $15.4 million, including over $2 million for the roll-out of the Integrated Safety Response pilots in Christchurch and Waikato; $8.4 million into restorative justice programmes to reduce reoffending; $14.2 million into mental health services across the justice sector, and an additional $1.2 million for the alcohol and drug treatment courts; $2.3 million for community and iwi panels that respond to low-level offending and address factors related to offending; and the Department of Corrections’ Out of Gate programme to support the reintegration of prisoners on their release. These initiatives, alongside many others and the work that the five justice sector agencies do, make significant differences in how we protect New Zealanders.

Women, Employment—Gender Pay Gap

5. JACINDA ARDERN (Labour) to the Minister for Women: Does she stand by her statement that closing the gender gap is “one of my top priorities”?

Hon PAULA BENNETT (Minister for Women): Yes.

Jacinda Ardern: If closing the gender pay gap is a top priority, why was dumping the plan of action for pay equity audits one of the very first things her Government did when it came into office?

Hon PAULA BENNETT: You will be pleased to know that it is my top priority as Minister for Women, and I have been in the job for 2½ months and have already made a lot of progress there. So now we have 45 percent of senior leaders in the Public Service, and I reckon that is going to make a big difference, seeing women in those roles. Twelve of the 29 chief executives are actually women, as well. We have now published the information for the Public Service, which is making a big—

Jacinda Ardern: I raise a point of order, Mr Speaker. I was quite specific. I was interested in the rationale that her Government had for dumping the action plan around pay equity audits.

Mr SPEAKER: And as Minister she is certainly responsible for actions that have been taken by the Government throughout its term, so I invite the member to ask the question again.

Jacinda Ardern: If closing the gender pay gap is a top priority, why was dumping the plan of action for pay equity audits one of the first things her Government did when it came into office?

Hon PAULA BENNETT: Because we had other priorities right then, working into the global financial crisis. What I will say is that right now we are working on legislation around the Joint Working Group on Pay Equity Principles. We are working through, in good faith, negotiations on TerraNova Homes and Care and the work there with aged carers. We have also got two other claims that are in, where we are, as I say, working through the principles as the legislation is happening as well, and we are committed to making a difference in that area.

Jacinda Ardern: If closing the gender pay gap is a priority, has she reprimanded the Minister of State Services for the fact that the gender pay gap there is 22 percent and has gotten worse, not better, in the 3 years since she has been Minister?

Hon PAULA BENNETT: The Public Service gender pay gap is actually 13.5 percent. That is where it is. This is the lowest it has been since the measurement began in 2000, and so that is what we are focused on. The gender pay gap is actually decreasing slowly, overall. As I have also said, we have got an absolute commitment. We have now got 45 percent women in senior leadership roles within the Public Service. It is the first time we have actually published the gender pay gap by department within the Public Service, and we are committed to reducing it.

Jacinda Ardern: If closing the gender pay gap is a top priority, then what specifically has her Government done in 9 years as an employer and contractor to actually lift the wages of home-care workers and support workers?

Hon PAULA BENNETT: Well, as I have said numerous times, we have actually increased the minimum wage every year since we have been in Government, and that has made a difference. And we are currently in good-faith negotiations on TerraNova Homes and Care, which will affect over 50,000 women—predominantly—in that area.

Dr Parmjeet Parmar: What is being done in the public sector to promote women to leadership positions and to close the gender pay gap?

Hon PAULA BENNETT: There are some fantastic things that are actually happening within the public sector, and I think it can set an example, do better, and publish those results. For example, as I have already stated, 45 percent of all leadership roles in the public sector are now held by women, and we are well on track to get that to 50 percent. We now publish the gender pay gap by department so that we can see progress being made, and we are doing that transparently. The Police, for example, has a target of 50 percent of new recruits being women, and it also runs unconscious bias training, which is making a difference. Defence has also noticed that it may have been getting more women in at the lower end but they were not actually progressing up into senior roles, and so it has made a change to its processes and is taking proactive action there to make sure that it can get them in.

Jacinda Ardern: If closing the gender pay gap really is a top priority, can the public sector truly play a leadership role when the Ministry of Business, Innovation and Employment, which is meant to model this to the private sector, has a gender pay gap of 20 percent—higher than the national average?

Hon PAULA BENNETT: But that is exactly why we published it, that is exactly why we are going to make a difference, and that is why we are going to close that gap. My point is, and the point that we have been making—no one has been going out there and saying it is perfect. No one is going out there and saying that this is where it is at. What we are saying is that there will be significant improvements, and we will stand up and be counted for it.

Mr SPEAKER: Question—[Interruption] Order! Question No.—[Interruption] Order! If the members wish to carry on their discussion, they are welcome to do it outside the House.

Small Businesses—Roadshows

6. STUART SMITH (National—Kaikōura) to the Minister for Small Business: What recent announcements has she made regarding support for small businesses in regional New Zealand?

Hon JACQUI DEAN (Minister for Small Business): Today I announced that the Government is extending the small business roadshows, going to another 10 regional centres in 2017. These roadshows are for small businesses, to help them navigate the support and information available to them. Last year’s roadshows were very well attended, and reinforced how important it is to continuously engage with small businesses and how critical it is to increase the visibility of support that they can access. This is why I am committed to extending the small business roadshow programme.

Stuart Smith: How is she supporting earthquake-affected areas such as Kaikōura through the 2017 roadshows?

Hon JACQUI DEAN: Today I announced the first roadshow for 2017 will be held in Kaikōura. Kaikōura and the surrounding areas have a particular set of circumstances to navigate. This roadshow will support small businesses in the area, with a particular focus on earthquake recovery - related matters. I have also announced that the next roadshow will be held in Blenheim. Blenheim had a roadshow that was scheduled last year, but was postponed due to the earthquake.

Nuk Korako: How is she supporting Māori business and enterprise through the 2017 roadshows?

Hon JACQUI DEAN: This year there will be two roadshows specifically designed for Māori business. These will be held in Kaitāia and Whakatane. Māori businesses are a growing part of the economy, and it is important we support them. I am also talking to my ministerial colleagues and Government partners about further opportunities to support Māori business and enterprise.

Superannuation—Residency Requirements and Overseas Pensions

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

Rt Hon BILL ENGLISH (Prime Minister): Yes, in the context in which they were made. That is why we have taken the step of outlining a fair and reasonable process for increasing the age of New Zealand superannuation to 67, starting in 20 years’ time. We believe that it is an issue that is best dealt with well ahead of time, rather than pretending nothing should change and making harsh decisions when it is too late.

Rt Hon Winston Peters: If a proposal 2 years ago to require migrants settling in New Zealand to have been here for 25 years was racist, bigoted, and against the New Zealand Bill of Rights Act, as the National Government then claimed, how come a requirement for 20 years’ residency cannot be all of those three things?

Rt Hon BILL ENGLISH: I am not familiar with the assertions the member is making, but I do welcome his and the public’s support for the policy that the Government announced this week, that the residency requirement will be moved from 10 years to 20 years.

Rt Hon Winston Peters: Will he disown comments of his Cabinet colleagues such as “I think that a very generously targeted superannuation regime is where this country will eventually find itself.”, which is code for means testing superannuation?

Rt Hon BILL ENGLISH: If that is what the member thinks it is code for, then we would certainly disagree with that comment. The Government has no plans for means testing national superannuation.

Rt Hon Winston Peters: Why is the Government so opposed to abolishing section 70 of the Social Security Act 1964, which is so unfair to migrants in New Zealand who have an overseas pension arrangement?

Rt Hon BILL ENGLISH: I think the measure that the member is referring to is just a longstanding measure that New Zealand has had in place through successive Governments, because we believe that is what is fair and reasonable to both migrants and New Zealand taxpayers.

Rt Hon Winston Peters: What is irredeemable about a long-term arrangement if it is wrong, and rather than Kiwi taxpayers being ripped off by these reciprocal pension agreements, why do we not ditch them, adopt a 25-year residency requirement, and allow migrants to bring their overseas pensions here, intact?

Rt Hon BILL ENGLISH: We think the current arrangements involving reciprocal agreements with other countries work best, both with the citizens of other countries coming here and with New Zealanders going to other countries. The member is free to put up his own proposals about changing that if he so wishes, but I am pleased to see that he is not actually criticising the policy announced this week by the Government.

Rt Hon Winston Peters: Why on earth does he expect New Zealanders to trust him on superannuation certainty when his record is to campaign for a 20-year phase-in, renege on that—

Hon Dr Nick Smith: Look at the member’s record.

Rt Hon Winston Peters: My record? Unbelievable, actually. It is fantastic; wonderful. Thanks for asking the question.

Mr SPEAKER: Order! I do not want interjections from my right-hand side interrupting the member’s question so he gets diverted into responding to the interjections. Can we have the question again, please.

Rt Hon Winston Peters: Thank you, Mr Speaker, for your indulgence.

Chris Bishop: Tell us about when you sold Contact.

Rt Hon Winston Peters: That is a lie, as well.

Mr SPEAKER: Order! Chris Bishop, if there is another interjection from you during question time, you will be leaving for the balance of the day. I have just given a warning. [Interruption] Order! I do not like having to give warnings twice so quickly.

Rt Hon Winston Peters: Why does he expect New Zealanders to trust him on superannuation certainty and stability when his record is to campaign for a 20-year phase-in, renege on that promise, renege twice on the issue of the surtax, renege on superannuation’s relativity to the net average weekly wage, renege twice on the Cullen fund, and after campaigning to leave superannuation at 65 renege on that as well?

Rt Hon BILL ENGLISH: Look, we have put a proposition out there in front of the public, and they get the opportunity in election year to debate it, and so far, the indications show pretty good public support for it. But I know how difficult it must be for the member to maintain his manufactured outrage, because he cannot find anything he disagrees with in the policy that we have announced.

Rt Hon Winston Peters: Apart from being delusional, how is it fair to propose a policy demanding New Zealanders work 47 to 49 years for their superannuation and yet give someone from overseas superannuation with only 20 years, whether they have contributed to it or not?

Rt Hon BILL ENGLISH: I expect there could be some debate between the 20-year threshold we have proposed and the 25-year threshold that member has proposed. I am pleased to see that if that is the one difference of opinion, then perhaps our policy has more support than even the member is aware of.

Superannuation Fund—Government Contributions

8. GRANT ROBERTSON (Labour—Wellington Central) to the Minister of Finance: Does he agree with the former Minister of Finance Bill English’s statement, in regard to the New Zealand Super Fund, “when surpluses return we will resume contributions”?

Hon STEVEN JOYCE (Minister of Finance): I agree with the former finance Minister and current Prime Minister on the subject. The Government has outlined its position many, many times over recent years—that we will resume contributions to the Superannuation Fund when core Crown net debt falls below 20 percent of GDP. This is currently expected to occur in 2020-21. I seek leave to table question No. 7 of 18 October 2016 and question No. 3 of 30 November—

Mr SPEAKER: Order! I do not need any more assistance. If it has been asked in the House, then members can—

Hon Member: He asked the same question.

Mr SPEAKER: Members are allowed to ask similar questions at any time.

Grant Robertson: In light of his predecessor’s various statements that the Government would restart Superannuation Fund contributions when the Government reached surplus, that it would restart them in 2017, then that it would restart them in 2019, and now that it will restart them in 2021, is it not the truth that he never intends to restart them?

Hon STEVEN JOYCE: I feel obliged now to raise those questions from last year that were answered in exactly the same manner as this particular line of questioning today. Question No. 3 on 30 November and question No. 7 on 18 October were both answered in the affirmative—that the Crown intends to resume contributions to the New Zealand Superannuation Fund when core Crown net debt falls below 20 percent of GDP. I have not, in the time available, had time to go back further, but given Mr Robertson’s repetitiveness I am sure I could find more questions.

Grant Robertson: Has he had any advice on the impact of the Government’s failure to restart contributions to the Superannuation Fund on whether the fund will be able to begin paying out in 2032, as planned?

Hon STEVEN JOYCE: The member may not be aware that, actually, the paying out of the Superannuation Fund is set by a legislated formula, which was set up by the previous Labour Government, that actually has the fund not making contributions to people’s superannuation until the middle decades of this century. That will be in the order of a maximum of 10 to 15 percent, and the current schedule on that formula means there will not be meaningful repayments from the Superannuation Fund until the mid-2060s.

Grant Robertson: I raise a point of order, Mr Speaker. You will recall the question asked about advice that the Minister had received on that matter. He waffled on about some other things—

Mr SPEAKER: No, I heard the question very carefully and listened to the answer, and I think that by the end of the answer it was addressed—clearly not to the member’s satisfaction, but to mine.

Grant Robertson: Why does he continue to prioritise tax cuts over restarting contributions to the Superannuation Fund, or is he really not that serious about doing actions today that could address the rising cost of superannuation?

Hon STEVEN JOYCE: The member seems to be under the illusion that the only worthwhile public expenditure item is putting money into the Superannuation Fund. But, actually, I know many New Zealanders who might disagree with that approach, including families who are struggling and families who are saving to buy a home and who might want more income of their own, rather than actually giving it to the likes of Parliament to provide for them. That is a legitimate public debate, and I am sure there are many families up and down this country right now who are saying in their minds to Mr Robertson: “We wouldn’t mind a little bit more so we can save a bit more for a house, and we wouldn’t mind a little bit more so we can provide a bit more for our children.”, and those are the sorts of questions that we will be answering and asking as the year proceeds.

Grant Robertson: When he said earlier this week that in politics sometimes you had to do the right thing, why is it not the right thing to actually put some effort now into dealing with the cost of superannuation, or would he rather just dump that on to future generations?

Hon STEVEN JOYCE: With the greatest respect, the member’s maths is wrong. The simple fact of the matter is that, in terms of the Superannuation Fund, it does not start to pay out anything meaningful until the middle decades of this century. Under the law—

Grant Robertson: It’s 2032—you know that.

Hon STEVEN JOYCE: 2060s. And there are other legitimate concerns that people have. The member is lining up and saying that he is not interested ever in easing the tax burden on Kiwi families, and it is fine for him to say that. Others are entitled to disagree. I personally am very focused on the current needs of New Zealand families.

Tax System—Multinational Enterprises

9. BARBARA KURIGER (National—Taranaki - King Country) to the Minister of Revenue: What is the Government doing to ensure all companies operating in New Zealand pay their fair share of tax?

Hon JUDITH COLLINS (Minister of Revenue): Last week the Minister of Finance and I released three consultation papers proposing new measures to strengthen New Zealand’s rules for taxing large multinationals. A broad-based, low-rate tax system works very well for New Zealand overall, but it is important to keep it evolving. New Zealand salary and wage earners do not get to structure their arrangements to avoid paying tax and nor should big multinational companies. This is about making sure all companies operating in New Zealand pay their fair share.

Barbara Kuriger: How will the proposals address base erosion and profit shifting?

Hon JUDITH COLLINS: Base erosion and profit shifting, or BEPS, are tactics used by some large multinationals to minimise their exposure to tax and move profits out of a country. The proposals released last week are in line with recommendations from the OECD’s BEPS project, which has developed best practice measures for the global response to BEPS. We have taken a strong but measured approach, which prioritises the specific problems that the Inland Revenue Department has actually observed in its investigations of multinationals. The proposals are aimed at tackling concerns about multinationals shifting profits from their New Zealand sales offshore, even though these sales are driven by New Zealand - based staff; preventing multinationals using interest payments to shift profits offshore; and implementing New Zealand’s entrance into an international convention for aligning our double tax agreements with OECD recommendations.

Freshwater Management—Land and Water Forum Recommendations

10. EUGENIE SAGE (Green) to the Minister for the Environment: Does he agree with Forest and Bird president Mark Hanger, who said, “in putting the Forum’s recommendations to one side, the Government has undermined the good faith and trust that we put in the Forum to help address the freshwater crisis facing all New Zealanders”?

Hon Dr NICK SMITH (Minister for the Environment): No, and that view is not shared by the 65 forum organisations nor the majority of the environmental groups that are on it. The forum’s recommendations have been at the core of the national overhaul of freshwater management. We have put some recommendations to one side, such as the forum’s recommendations that the Government put Government appointees on all regional councils. Given the member’s vehement opposition to us doing this in Canterbury, I am not sure the member would want us to do that to every regional council.

Eugenie Sage: What is the point of collaborative processes such as the Land and Water Forum, when he cherry-picks its recommendations, forcing major environmental organisations like Forest & Bird and Fish and Game New Zealand to withdraw?

Hon Dr NICK SMITH: I would note that important environmental groups like the Federated Mountain Clubs, Whitewater NZ, Ecologic, the Environmental Defence Society, and Landcare Trust do not share those views. I think it is fair to say that with Kevin Hague leading Forest & Bird, it has mistaken its role and is now an extension of the Opposition.

Tim Macindoe: What has been the response of the Land and Water Forum to the Government’s latest steps to improve water quality, including the goal of 90 percent of lakes and rivers being swimmable by 2040?

Hon Dr NICK SMITH: The forum said in its press release last week: “The proposals represent another important step forward in improving New Zealand’s [approach to] freshwater management.” It said that it particularly welcomed that the Government had adopted the stock exclusion proposals that were hugely important to improving freshwater and on which regional councils had made very little progress over the last 25 years. It also included areas that required further work over the detail, particularly around the issues of ecological health and nutrients and how regional councils should respond when those indicators show that things are not making progress.

Eugenie Sage: How can he say that the Government has made progress with the Land and Water Forum’s recommendations, when its own secretariat in its assessment shows that over half of the recommendations have not been implemented?

Hon Dr NICK SMITH: Yes, it is true that we have not implemented recommendations like establishing a new land and water commission or recommendations like the Government putting appointees on every regional council. But if you look at the core of what it recommended, and that was a national policy statement that this country never had until this Government—

Hon David Parker: That’s because you spiked the last one. You spiked the Sheppard one.

Hon Dr NICK SMITH: —regulations for stock exclusion, regulations—well, Mr Parker, you had 9 years and you did nothing, and we have made far more progress in 8 years and we are proud of it.

Eugenie Sage: Was lobbying from irrigators and the dairy sector the reason he largely ignored the forum’s recommendations on swimmability and ecological health, and came up with something very different?

Hon Dr NICK SMITH: No. The key issue about swimmability is standards that are practical. The reality is that New Zealand rivers regularly flood. During those periods, E. coli limits peak. And with the swimmability standards that are being proposed by members of the Opposition, you would end up labelling most of the rivers in New Zealand as unswimmable simply because they flood and that is illogical and we are the party of practical environmentalists.

Roading, Taranaki—Accelerated Regional Roading Programme

11. JONATHAN YOUNG (National—New Plymouth) to the Minister of Transport: What updates can he provide on the Government’s Accelerated Regional Roading Package?

Hon SIMON BRIDGES (Minister of Transport): The Government continues to make strong progress on delivering its package of accelerated regional roading projects across New Zealand. It was my pleasure to recently open a new section of State Highway 3, north of Normanby, in Taranaki. We have invested $18 million to realign and improve the capacity and safety on this important stretch of road. The local community has, as I know the member knows well, campaigned passionately for much-needed safety upgrades to the road, which has a history of serious and, indeed, fatal crashes. That is why I am proud that the Government has been able to step in and deliver a new road that will reduce the risk of crashes and significantly cut travel times for road users.

Jonathan Young: What other projects is the Government delivering through the Accelerated Regional Roading Package to improve safety and support economic growth in Taranaki?

Hon SIMON BRIDGES: Supporting the growth of Taranaki through the transport network is a real priority for the Government. That is why we are stepping in and investing $135 million on the Mount Messenger to Awakino tunnel bypass projects, as well as a range of safety improvements along State Highway 3. The bypasses and other planned safety improvements will ensure that this important stretch of road is safer and much, much more reliable to travel on. All up, this and other projects demonstrate the Government’s strong, ongoing commitment to investing in Taranaki and its transport development and economic growth.

Investing in Educational Success Programme—Funding

12. CHRIS HIPKINS (Labour—Rimutaka) to the Minister of Education: Does she stand by her statement in June 2014 with regard to the Investing in Educational Success initiative, “parents will be very pleased we’re making such good progress on something that will make a real difference in our schools and classrooms”?

Hon HEKIA PARATA (Minister of Education): Tēnā koe, Mr Speaker. Yes, and I would like to congratulate the member. This is the first full and accurate quote he has attributed to me.

Chris Hipkins: How is having 93 percent of the $359 million in funding that was appropriated back in 2014 remaining unspent in the Crown account making a real difference to schools and classrooms?

Hon HEKIA PARATA: Yes, I am very impatient about that figure, because it reflects the 1-year delay caused by the NZEI’s negotiations, and so a programme that was supposed to begin in 2014-15 did not get under way until 2015-16, and despite that year’s delay, which has the practical effect of hundreds of teachers being denied access to these new roles, we are, nevertheless, at a case of having 180 communities of learning formed, accounting for 15,003 schools and kura, and nearly half a million students in New Zealand.

Chris Hipkins: Does she think the delay could perhaps have been avoided if she had designed the policy better in the first place, given that after it was announced a survey of school principals found that 54 percent were opposed outright to the plan and 27 percent had serious concerns about the policy, while only 4 percent thought it was a good idea?

Hon HEKIA PARATA: No, I do not agree with the member given that the working group involved representatives from the peak bodies and from the unions prior to it being announced. We worked, nevertheless, at the pace that the unions wanted to work at, and we are now in the situation where, as I have said, over half of all schools are involved in this really exciting initiative. But the travesty here is that the delay has caused hundreds of teachers to not have access to these new roles.

Chris Hipkins: Why will parents be pleased that over $330 million remains sitting unspent in the Crown accounts given that since she became Minister in 2011 parental contributions to their kids’ education have increased by over 23 percent—almost five times the rate of inflation?

Hon HEKIA PARATA: Parents should be very concerned about that member’s ability to actually read Government accounts, or even survey information, because the figure that he persists with includes fees for private schools, whereas the facts based on the financial returns of schools are that parental donations have remained consistent, at about 1.8 percent. And they are donations—therefore they are voluntary, therefore parents are making them.

Chris Hipkins: Why have 32 percent of the allowances paid to teachers under the Investing in Educational Success initiative been paid to teachers working in the highest-decile schools while only 2 percent has been paid to teachers working in decile 1 schools?

Hon HEKIA PARATA: We are just heading past the 2-year mark of this programme. When it first began, higher-decile schools were the earlier adopters. But as of the end of last year, I am happy to relieve the member’s anxiety by telling him that we have 150 decile 1 schools, whereas we have 141 decile 10 schools. We have 156 decile 3 schools and 156 decile 8 schools. In fact, the distribution across all types of schools is pretty even. So the member will therefore have his anxiety relieved.

Chris Hipkins: Why does she continue to claim that school funding is at record levels when the analysis released today through Infometrics shows that, on a per child basis, school funding has increased by just 2.3 percent in real terms under her Government compared with an increase of 22 percent in real terms between 2002 and 2008 under the last Labour Government?

Hon HEKIA PARATA: I have not seen the Infometrics report yet, but there is only one set of facts, and they are in the Government’s Budget accounts. The member is invited to go to my website, where they are there in very simple terms to understand: that we have gone from just over $8 billion to $11.04 billion. In the period 2010 to 2016, inflation, I think, cumulatively went up by 10.9 percent while operations grants went up by 16.8 percent, and the number of kids—

Chris Hipkins: And the number of kids went up.

Hon HEKIA PARATA: —thank you, Mr Hipkins—went up by 3.6 percent.

Chris Hipkins: How has decreasing funding for school capital by 13.9 percent in real terms over the past 8 years, resulting in kids languishing in cold, damp, leaky, and overcrowded classrooms, made a real difference in our schools and classrooms?

Hon HEKIA PARATA: It is just hard to take this seriously. My Associate Minister, Hon Nikki Kaye, has done something that no other Minister has done, which is to commission and to have a condition assessment of every school building across New Zealand. That now gives us a basis against which to invest taxpayers’ funds and prioritise where we do redevelopment, refurbishment, address leaky building issues, earthquake strengthening, and so forth. What I can tell the member again is that, factually, we have spent a third more in the 8 years that we have been in Government than occurred in the 8 years under that previous administration, all of which is in the Government accounts, publicly available to those who can read them.

Debate on Budget Policy Statement

Debate on Budget Policy Statement

Chris Bishop (Chairperson of the Finance and Expenditure Committee): I move, That the House take note of the report of the Finance and Expenditure Committee on the Budget Policy Statement 2017. What does this Budget Policy Statement, which was presented to the Finance and Expenditure Committee last year, show? It shows four very important things.

Firstly, it projects growth of 3.5 percent for the next 2 years, and 3 percent over the next 5 years. In the New Zealand context, this is extremely good—far ahead of the long-run rate of average growth in New Zealand. Economic growth provides more opportunities for the Crown accounts, it provides more opportunities for New Zealand families, and it gives us choices as a Government.

Secondly, it projects more jobs—150,000 more jobs by 2021. At the moment, our employment rate is the third-highest in the OECD. It shows our labour force participation rate as one of the highest in New Zealand history at over 70.5 percent. Those are some of the key metrics that determine the long-run future prosperity of a country.

Thirdly, it shows rising wages. It projects that the average annual wage will hit $66,000 per year by 2021. We had 1.6 percent wage growth in 2016—far ahead of inflation. It is these kinds of moderate, sustained increases in New Zealanders’ real take-home pay that drive higher living standards.

Fourthly—and I know members of New Zealand First really do not like this—the Budget Policy Statement shows that people want to live in New Zealand. It shows that New Zealanders do not want to leave New Zealand any more. It shows that New Zealanders overseas want to come home to New Zealand, and it shows that people around the world are choosing New Zealand as the destination of choice because our economic outlook is far superior than many countries opposite.

What the Budget Policy Statement shows is a set of numbers that are the envy of the developed world. They are a set of numbers that any developed economy would love to show. That is why people around the world look enviously at New Zealand.

What does the Budget Policy Statement show about superannuation? What it states is that the Government will resume contributions to the New Zealand Superannuation Fund when net debt starts to decline below 20 percent of GDP. We have had this debate in the last few days, since the Government’s announcement on Monday about the gradual progressive rise in the superannuation age from 2037 onwards. We have had this debate about whether or not this is appropriate.

The Government did stop borrowing to invest in the Superannuation Fund in 2009. We maintain that this was the right decision. Borrowing money to invest in global equities is like a household putting money on the credit card to invest in the global share market. We know that when the Cullen superannuation fund was set up in 2000 by Michael Cullen, it was set up to invest surpluses. Michael Cullen was extremely clear about this. He said Labour was setting up the fund to fund the long-term cost of superannuation by pre-investing surpluses—not borrowing money and whacking it on the credit card, but investing surpluses. As members opposite are so proud to proclaim very often, there have not been many surpluses in the last few years. Now we have got the books back into the black and we have got these choices.

The other thing that members forget is that the Labour Party and the Green Party have done a flip-flop on this issue as well. It was David Shearer, in 2013, who actually decided that the Labour Party was going to agree with the National Government and not start contributions to the Superannuation Fund while the Crown books were in deficit. I can quote no more learned commentator on this particular subject than the former Green Party finance spokesperson Russel Norman, who said in 2013 that he welcomed the Labour Party’s backtrack, that the National Government was right to stop contributing to the Superannuation Fund while it was running a deficit—“it was always very strange that [the Labour Party] wanted to borrow money to put it into the Cullen Fund, and I’m glad that they have seen common sense on it.”

So the now sadly lamented, departed leader and finance spokesperson of the Green Party actually agrees with exactly the position that the National Government has advanced consistently for 8 years, which is that it makes no sense to borrow money to chuck it into the Cullen fund—into the New Zealand Superannuation Fund. Members opposite often say “Oh, well, look at the returns; look at the returns.”, and the returns have been great, but it is very easy to look back in hindsight and say: “If only we had done this.” Of course, investing in global equities, and investing in the global sharemarket—just because you put money in it, there is no guarantee of future returns. These things do have risk. Members opposite have no concept, no understanding, of the concept of risk.

It is a bit of a thought experiment, but it does beg the question: if we had continued to borrow this money and put it into the Cullen fund, and we were sitting around today and the size of the fund had actually decreased by $15 billion, what would members opposite be saying now? Well, they would be standing up and they would be saying: “That was a crazy decision of the Government; you should never have borrowed money at a time that you were running fiscal deficits to invest in the global sharemarket, because look at the consequences. Look what has happened. You have destroyed New Zealand’s future. You have mortgaged young New Zealanders’ future.” That is exactly what they would be saying, and they would be right. We would have been doing that. We would have been doing that. So it is all very well to look back on the past and say we should have done that, but it ignores the concept of risk. It ignores the fact that the fund could have gone down.

The other thing about this argument about the Superannuation Fund, when it comes to raising the age of superannuation entitlement, is that it would have required the Government to borrow $13.5 billion more than we were already borrowing. Again, I point out that members opposite often like to stand up and talk about how the Government is borrowing too much money, the Government has borrowed more money than Rob Muldoon, and we cannot possibly borrow any more money—neglecting, of course, to mention their own profligate and extravagant spending plans. So I just point out the interesting contrast there. They often try to imply, when it comes to dealing with the long-term costs of superannuation, that if we just funded the Cullen fund, that would have dealt with it. Nothing could be further from the truth. By 2040 the Government’s plan, which the Prime Minister outlined on Monday, saves the Crown $4 billion a year. If we had borrowed all that money and put it into the Cullen fund, it would have probably saved the Crown about $1.4 billion a year by 2040. So the big question for Labour and the Greens is: where is the other $2.6 billion coming from?

What the Government announced on Monday is a sensible move. I am 33. I do not know anyone my age, or of my generation, who thinks that superannuation at the age of 65, with the generous system that we have, is sustainable in its current form. That is because, at the moment, there are four workers for everyone over the age of 65. By the time we hit 20 years’ time, there will be two workers for everyone aged over 65. The long-term costs of superannuation are going up. It is projected to treble in 20 years from $11 billion a year to $36 billion a year. This fiscal earthquake is not something that is unique to New Zealand—it is why Australia is doing what we are proposing; it is why Denmark and other countries are doing it as well. It is time that the Labour Party went back to its policy—its admirable policy—of the 2011 and 2014 elections and got on board with this, because there are a litany of quotes from senior Labour Party members about the long-term costs of superannuation.

Andrew Little said the one thing that scares the bejesus out of him—very old-fashioned word—is the long-term cost of superannuation. David Parker used to go up and down the country to business audiences talking about raising the superannuation age being the very epitome of fiscal responsibility. Well, we agree. The much-vaunted new deputy leader of the Labour Party, Jacinda Ardern, said we need to ask whether the universal age of superannuation is set at the right place, and there are a series of quotes from her about that. Well, she is right; Andrew Little in 2014 was right; David Shearer in 2013, when talking about the superannuation age, was right. Parties opposite are playing populist politics on this issue, and they need to get on board with what this very fine Budget Policy Statement laid out by the Government provides, which is a great set of numbers that sets New Zealand up for long-term prosperity.

I just want to end my speech by talking about that, because, actually, the hard work is just beginning. We have done a very good job of getting through the Christchurch earthquakes, we had the fiscal headroom to get through the Kaikōura and Wellington quakes, we have got the books back into the black after the profligate spending years of the last Labour Government, and now we have choices. I, for one, am looking forward to campaigning later in the year on the choices that the Budget Policy Statement provides.

GRANT ROBERTSON (Labour—Wellington Central): I have a short phrase to respond to that speech from Chris Bishop: bring back David Bennett, because at least David Bennett would have tried to mount some kind of proactive support for the Budget Policy Statement. Instead, we have a range of Mr Bishop’s memories from 2011 and 2014. He managed to miss out a couple of them—in fact, I suspect he might have been responsible for the following quote from the then economic development Minister, Steven Joyce, who reacted to a statement from the Retirement Commissioner, saying that the nation’s superannuation system was affordable and no changes needed to be made. That is what Chris Bishop wrote for Steven Joyce. So if we are getting into the idea of who might have moved their position, Mr Bishop, the House is a very glass one.

When we look at the high-level numbers and indicators that are in the Budget Policy Statement, it would be easy to say the New Zealand economy is doing absolutely fine at that high level. I am reminded of what I did when I was a young university student and I managed to earn myself a little bit of money. I was very excited to buy a car—I wanted to buy my first car—and I went and bought a car from a very reputable used car sales yard. It was painted red, and that was the most important thing to me, even then, that the car was painted red.

Kris Faafoi: What was it?

GRANT ROBERTSON: It was in fact a Nissan station wagon, Mr Faafoi, and it looked fantastic. It looked brilliant. I drove it home from the used car yard and I drove along and it was going fine, and then one or two rattles started to emerge. So when I got back home I lifted up the bonnet, and then I saw the real story. That is what is happening with the New Zealand economy.

Tim Macindoe: Caveat emptor, Grant.

GRANT ROBERTSON: If we look under the bonnet, it is not quite so attractive, is it, Mr Macindoe? If we look under the bonnet, there are still 140,000 New Zealanders unemployed. If we look under the bonnet, there are 90,000 15- to 24-year-olds not in education, not in employment, and not in training, and, unlike the Prime Minister, we do not think they are drug-addled, hopeless people; we think they are New Zealand’s future, who deserve some support and some investment. But that is the statistic that is sitting in front of the National Party. Long-term unemployment has nearly tripled, to 44,000 under this Government.

Remember this every time the Government members get up to tell us something about unemployment statistics—remember this: in every region of New Zealand the unemployment rate is higher than it was when National came into office. It declared the global financial crisis over in 2012. Where are the benefits there? Under the bonnet of this economy, we have long-term problems going unaddressed. New Zealanders look at those high-level statistics and wonder “Where’s the benefit for me?”. Wage and salary earners who average ordinary-time wages are falling behind: 45 percent of Kiwis did not even get a pay rise last year; more than two-thirds of New Zealanders got a pay rise of less than 2 percent. At the same time, their housing costs were spiralling—on average an increase of 11 percent. Steven Joyce admitted in this House just a couple of weeks ago that the net effect of those low wage increases and those spiralling housing costs has been that for the average household last year, they were $1 a day better off—$1 a day.

That is the benefit of the so-called growing economy. That is what ordinary New Zealanders are experiencing, and that is why they are questioning whether or not these high-level statistics actually mean anything. Yes, GDP growth is at 3 percent; real GDP per capita is less than 1 percent. It is population growth that is driving GDP growth. We are not seeing the improvements in productivity that Bill English and Steven Joyce like to talk about. What we are seeing is New Zealanders working more and more hours and not getting ahead. That is what is happening in the real economy that the National Party members do not want to talk about.

So where does that leave us as a country, looking at this Budget Policy Statement? We should be seeing in this Budget Policy Statement some kind of vision for growing the wealth of all New Zealanders, some kind of sense of shared prosperity, because there is no point in an economy that delivers growth rates of over 3 percent if more than 5 percent of New Zealanders are unemployed. There is no point in growth rates of over 3 percent if people are living in cars and garages, and 41,000 New Zealanders are homeless. The economy is not an end in itself; it is the means to creating the kind of society that all New Zealanders can enjoy the benefits of, and that is what this Budget should be focusing on.

It is a Budget that should be focusing on how we grow decent work opportunities all around New Zealand. I was really pleased when Andrew Little went to both Dunedin and Gisborne in the adjournment that we just had and came up with practical ideas to create jobs in those areas: a centre of digital excellence in Dunedin and another wood processing plant in Gisborne. That is what will grow decent jobs, that is what will spread the benefits of a growing economy around the population: practical partnerships from an active Government in the regions of New Zealand growing those decent work opportunities.

In Dunedin, my old home town, we look now—with the Cadbury’s factory closing, with Hillside having closed—at cities and regions that have been left behind by this Government. We can do practical things as a Government about that: a procurement policy that actually gives New Zealand firms a fair go at bidding for contracts. We have not seen that from this Government, and places like Hillside have lost out. We can do better than that, and the Labour Party will make sure that we do.

We need to look at the drivers of productivity. We need to get more capital to our small businesses to allow them to grow and develop. It is hard work out there running a small business in New Zealand at the moment. The Government can do all the roadshows it likes with Jacqui Dean in charge, but in reality what those firms want is some support to actually be able to grow themselves. We also need to invest in skills and training. This is the most important thing we can do for the future of New Zealand—not write off a whole cohort of young people but actually do active programmes like Ready for Work, which Andrew Little announced at the Labour Party conference; like revamping our careers advice and guidance service so every single school-leaver has a plan about what they will be doing; like Dole for Apprenticeships where we take that money paid in the dole to 18- and 19-year-olds and convert it into a subsidy for apprenticeships. These are practical policies that are about giving young New Zealanders the skills that they need.

Relying on anecdote, relying on saying that everyone who comes into a business is failing a drug test and that is the problem is absolute rubbish and it is defeatist nonsense from the Prime Minister, who does not want to face up to the fact that after 9 years in Government he has left 90,000 15- to 24-year-olds outside of any kind of training or work. That is the kind of issue that has to be addressed head on and it is certainly what the Labour Government will do after the next election.

Then we start to look at the issue of housing, and this remains one of the most critical things. When you take a look at the Budget Policy Statement, once again the Government has failed to tackle the housing crisis. It has failed to tackle the fundamental issue that gives New Zealanders security—owning your own home or, at the very least, having some security of tenure in your rental property. That is the issue that, time and again, Budget after Budget, the Government has thrown its hands up and said it is somebody else’s responsibility. Well, that has to change and that is why the Labour Party has proposed a suite of measures, from the KiwiBuild programme of building 100,000 affordable homes over 10 years, through to a proper social housing agency in Housing New Zealand responsible for actually creating security for people who are not able to house themselves, through to addressing homelessness. All of those issues have to be addressed because they are core economic issues. If we do not get housing right, if people do not feel secure, then they will not be able to get ahead.

What this Budget Policy Statement reveals is a series of deficits underneath the surplus: an infrastructure deficit. We have a massive shortfall in housing. We have transportation issues in Auckland that are clogging up the roads and destroying productivity in that centre. We have a deficit in infrastructure that this Government has let rise, and that will need to be addressed and will be a significant priority for a future Labour Government.

But we have also got a massive social deficit. The under-investment in health, in education, in housing, and in addressing child poverty has to be dealt with in a Budget. This Budget Policy Statement from the Government lacks vision, lacks courage, and lacks the kinds of investments that will allow all New Zealanders to succeed. Under a future Labour Government we will prioritise security and opportunity for all New Zealanders.

Hon AMY ADAMS (Minister of Justice): I am very pleased to take a call on the Budget Policy Statement (BPS) as we build up towards Budget 2017. I would start my contribution by noting that, in my view, the core job of a Government is to make sure its people are safe and to make sure they have the opportunities to get ahead. I think I can safely say that, certainly on this side of the House, the reason that we have come into Parliament is that we care deeply about providing those two things: making sure that our country is safe and that our people have every opportunity to get ahead. When you boil that right down to its most basic, the one thing that we need to have if we are going to give New Zealanders the chance to get ahead is a strong economy that provides those opportunities. If there is one thing we know, it is that it is businesses that provide jobs, it is businesses that create opportunities, and it is the men and women of New Zealand who go out and invest their own money in creating businesses, creating opportunities, and creating jobs—who create jobs for New Zealanders.

It is not—it is not—a contest of how much money one political party or the other can spend. If this is a spending contest—if we want to measure successive Governments around how much you spend—Labour is going to win that race every day. This side of the House knows that real success looks like an economy that is creating jobs and that is creating opportunities, a system that is educating our people, and a system that looks after our most vulnerable, and that is why this side of the House and this National-led Government talk consistently and unapologetically about the need to have a strong economy, to have a strong education system, to have a strong health system, to keep our people safe, and to get back to surplus.

Why do we talk about getting back to surplus? Why does this Budget Policy Statement repeatedly talk about the strong progress we have made to turn the books around from the never-ending deficits that Labour left us to, now, projections of strong, solid, building surpluses? Why does that matter? Very simply, because surpluses mean choices. We are a Government that understands that you have to earn money before you spend it, and once you have surpluses it means the Government is in a position to sustainably make choices about how we can invest to better New Zealand’s future. What we are not going to do—what we are not going to do—is borrow to speculate and spend, to buy the votes of New Zealanders in election years. We are going to make sure we have money in the tin to invest in New Zealanders, and that is why we have worked so hard over an incredibly difficult period to get us back to a situation of surplus.

Let us just reflect on that. Let us reflect on the last 8 years in which we have done that. It was not enough that we came in and Treasury was forecasting never-ending deficits after the end of the Labour Government. If that was not enough, we also took on, of course, the global financial crisis. Of course, I am not blaming the previous Labour Government for that, but that is why you need to be in surplus, because then you have the ability to get through global shocks like that. Again we are looking at a period of great international uncertainty, and New Zealand needs to be in a position of economic strength to weather that. We are a very small player in a large sea of international economies that are a bit wobbly, frankly, at the moment, and New Zealand has to outperform all of those to continue to do well—and we will.

The most exciting thing for me in this Budget Policy Statement is showing not only that we have delivered on our promise to New Zealand to manage the economy well, to manage the Government books, to bring down net Crown debt by 2020, to create jobs, and to build a strong economy, but that this is now an economy—and this is not just the Government talking, and not just Treasury; every international assessment of New Zealand says this—that is growing faster than almost every economy we would measure ourselves against, and it is forecast to have stable, predictable, year-on-year growth of an average of 3 percent per annum for the next 5 years. That may sound modest, but when you realise that is faster than the EU, it is faster than Australia, it is faster than the UK, it is faster than the US, it is faster than Japan, and it is faster than Canada, you realise that for all the Chicken Little talk we hear from the Opposition, this is a country, thanks to the management of Bill English and John Key and Steven Joyce and the whole team of Ministers, that is growing strongly.

It is growing in a stable way, and we are seeing the results of that every single day. We are seeing it through jobs. We are seeing our unemployment rate dropping and our employment growth stronger, almost, than we have ever seen—now the third-highest in the OECD, as we heard from Mr Bishop. The Budget Policy Statement forecasts unemployment to drop to around 4.3 percent, which is an incredibly strong result, and the household labour force survey in the last completed quarter reported 19,000 more people employed just in that quarter—in 3 months; 19,000 more people employed in just 3 months.

And it is not stopping. We also see 150,000 more jobs coming into the economy over the next few years, thanks to the policies of this Government. That does not happen just by getting up in the morning and wishing and hoping and spending money on Government services. That happens by building an economy that businesses have the confidence to invest in. That is mums and dads and families putting their capital on the line because they see positivity in New Zealand, and that is why we are seeing so many New Zealanders wanting to be here, wanting to come home. We are seeing wages going up faster than inflation. We see it in the BPS, and we see that it is forecast to continue to rise, up to $66,000 for the average wage, by 2021. That is very strong growth, and, importantly, faster than inflation.

We have got, now, the largest ever construction workforce, thanks to the rapid period of building construction we are seeing not just in Christchurch post-earthquake but in Auckland, in Queenstown, in Tauranga, and right across New Zealand. The other thing that I really want to highlight is that this is not just a story of a strong economy in Auckland or a strong economy on the farm. This Government has overseen the development, now, of six, I think it is, regional economic development plans, covering areas like Northland, like Gisborne, like Manawatū, and like Southland. We have just released the most recent one in Tai Rāwhiti, which has gone down incredibly well. Every part—

Hon Maggie Barry: That’s good.

Hon AMY ADAMS: —West Coast, quite right—of the New Zealand economy has a positive future, and we are helping them to see, identify, and deliver the opportunities in their region.

What we do know, of course, is that that is very much underpinned by our strong commitment not only to educating our core workforce, which underpins all of New Zealand’s success and the fabulous work Hekia Parata has done in that area, but to building the physical infrastructure to support it. The ultra-fast broadband (UFB) programme and the Rural Broadband Initiative’s (RBI) $2 billion is making sure we are one of the best-connected countries in the world. I am incredibly proud of that, as I am of our investment in schooling, our properties and policing, and in roading projects to support it.

But I just want to end by going back to that comment I made before, which is that we do have a period where the international situation is uncertain, and we should not ignore that. We have to be mindful of it. But what it says to New Zealand is that it is even more important now that we stay on the track we are on, which is one of seeing our net Crown debt reducing to around 19 percent by 2020, having our strong economy growing, managing core Crown expenses, creating the environment for investment, and, most importantly, delivering strong, stable Government. That is what has got us through the global financial crisis, that is what has got us through the twin shocks of the Christchurch and Canterbury earthquakes and the Kaikōura earthquakes, and the other natural disasters, that is what is seeing New Zealand now being held up internationally as a leading light in what good fiscal management and good, stable Government can deliver.

I cannot count the number of times I have been told by international counterparts “Why can’t we do as well as New Zealand’s doing? What is your secret?”, and I can tell you it is very simple. The secret of this Government is the strong, stable, consistent leadership of the John Key and now the Bill English - led Government.

STUART NASH (Labour—Napier): Look, we did not think we would see it here. We read about the phenomena in the United States. You have just heard a post-truth speech from that Minister, Amy Adams. The Minister stood up and said that “Unlike Labour, we have produced all these surpluses.” Well, if the Minister knew her history, she would know that every single Budget that Michael Cullen delivered delivered a surplus. The first seven Budgets that that Government delivered had a deficit. How can you say that we did not deliver surpluses? That is simply not true.

The Minister stood up and said that there are two things that her Government is working hard to deliver: safer communities, where people can get ahead. Well, between 2016 and 2015, there were 11,000 more victimisations—11,000 more. The Police are woefully underfunded. They admit it themselves. In fact, both Police Ministers we have had in the last couple of years have admitted it. Ninety percent of burglaries go unsolved, and that Minister says we are creating a safe environment for Kiwis! How can she stand up there and actually say it when the facts simply do not bear that out? She said: “We wanted to create an environment where New Zealanders can get ahead.” We now have 140,000 unemployed New Zealanders. We have 90,000 New Zealanders between the ages of 15 and 24 who are not in employment. I believe that they have been let down by an education system that is not catering to 21st century learning. When you have 90,000 unemployed young people, you have got to have a look at what the Minister has done to the system and say that it is simply not working for young people in the 21st century.

Minister Amy Adams talked about the average wage increasing in 2021. Really? Do New Zealanders really care about what will happen to the average wage in 2021 when, at this point in time, they are struggling to put food on the table and petrol in the car, pay the power bill, pay the mortgage, and, if they are lucky, find a house so that they can pay the rent? They do not want to know about the average wage in 2021; they want to know what the Government is doing for them now. It was astounding—oh, I was shaking my head.

And we had Mr Bishop before that Minister, and Mr Bishop talked about hypothetical scenarios that simply have not existed. But Mr Bishop’s speech was actually quite revealing, because what Mr Bishop talked about was what the Government wants to do in the next year or two. I think there are fundamentally two major differences between Labour and National. The first is that Labour is not looking to where New Zealand will be in 2017, 2018, or 2019. We want to know—we have got a vision—where we want New Zealand to be in 2040. What we are doing is we are looking out to the future and saying we have got a vision.

We want to create a New Zealand that our grandchildren and great-grandchildren can inherit. We want to create an environment that is really good for them and an education system that is world class to make sure they have the training, to make sure there are the jobs available, and, when these young children now are adults, to make sure they have the ability and the skills and the competencies to take on tomorrow’s jobs. That is why Grant Robertson undertook the Future of Work project, and it was enlightening. Amy Adams said that people are looking at New Zealand and saying: “Why can’t we be as good as you?”. That is because Grant Robertson was the one who painted the future for where we need to be. We have a vision.

The other thing was Mr Bishop and Amy Adams kept talking about fiscal risk, but that is another one of the differences. For us, it is not just about the dollars and cents. For Labour, it is about the people. For Labour, it is looking and saying: “What do we need to do to that will serve all New Zealanders? What do we need to do that will create sustainable economic development—that will create jobs and wealth and will put more money in the back pocket of good, hard-working Kiwis—but will create jobs? We will look after our children and our elderly.” The Minister Amy Adams talked about our magnificent health system. It has been underfunded by $1.7 billion. Labour is looking at this and saying: “What do we need to do to make sure all Kiwis have the health system they deserve?”. That is the difference between Labour and National.

For us, it is about creating a vision. For us, it is about making sure that New Zealanders have a role to play and can buy into that vision. For those members, it is about dollars and cents, and it is coming to the fore now—there is no doubt about that.

But the other thing that Mr Bishop said that did make me smile was he said—and I quote—“The hard work is just beginning.”, and I think that was a very salient admission that for the last 8 years, this Government has not been doing much at all. Mr Bridges has—there is no doubt about that—but he is probably the only Minister on that side who has been working very hard. None of the other Ministers have. Oh no, no—Judith Collins has done quite a lot of work, as well. But, by and large, the hard work should have started the week after the election. That is why Labour has a plan for what we want to do in the first 100 days, not the first 2,000 days. We are going to start working hard the day that our feet hit the floor on that side, because we know what we want to do to create the vision that New Zealanders will buy into.

But another one of the major differences between Labour and National is that National believes that the market can control the outcomes—the market has got all the answers, so if you leave it to the market, everything will be OK. Labour believes that, in fact, in a country the size of New Zealand, with 5 million people, the Government actually has a very important role to play in economic development.

Again, if you look at the statistics, you know, they speak for themselves. Investment in research and development has dropped from 0.54 percent of GDP in 2012, to 0.52 percent of GDP in 2014. At 0.54 percent or 0.52 percent, it is still incredibly low, and I believe one of the reasons why it is so low is that the Government has not created the sort of environment that encourages small businesses, medium businesses, or large businesses to invest in research and development. Although the small business roadshow will go ahead, and they will sit down and they will drink some wine and they may have a couple of hors d’oeuvres, my experience is that what people in small businesses actually want is not a glass of wine. What they want is to know that the Government has a plan in place to allow them and to encourage them to invest in research and development, because that is what is going to drive jobs.

I do remember that the Prime Minister, when he was the Minister of Finance, actually came out and said something along the line of one of New Zealand’s competitive advantages is we have such a low wage rate. He said that—we have such a low wage rate. Our minimum wage is so low, it is cheap to employ workers. One of the major problems we have in this country is our low productivity. It really is dreadful. We need to create an environment that encourages business to invest in capital. That will grow capital. That will grow jobs. That will grow productivity. Mr Scott knows this because he is a businessman. He must look around and go “What do we need to do to actually grow jobs?”, and it is not about talking about them. It is not about roadshows. It is about creating the sort of fiscal business environment that encourages business to invest in research and development.

I remember when the Mosgiel plant for Fisher & Paykel closed down, with the loss of about 400 jobs, I think. At the time, the first reaction was “Goodness me! Four hundred jobs? That’s really going to gut a community like Mosgiel.” The next question was: why have we got an assembly plant with 400 people? Why is that plant not employing 100 people, working 24/7, and is a lot more efficient than the most efficient plants around the world? We are a country with low productivity.

Let me sum up. I want to start by saying that Labour has a vision for New Zealand. Labour has a vision for New Zealand that includes all New Zealanders. Labour has a vision for New Zealand that includes the education system, that includes the health system, and that includes funding the health system in a way that meets the expectations of all Kiwis. Labour has a vision for New Zealand where the tax system enables businesses and works with businesses to grow, as well as not disadvantage Kiwis.

We know that we have not got an education system fit for the 21st century. That is why we have come out and promised 3 free years of post - secondary school education. Unless we start treating New Zealanders, unless we start training them, and unless we start investing in their future, we are never going to reach our potential. I do not want to benchmark New Zealand against other countries. What I want to do is be part of a Government that always says: “How can we do better?”. Labour has a plan for that. Thank you very much.

Hon SIMON BRIDGES (Minister for Economic Development): It is fantastic to speak in this Budget Policy Statement debate. That is because there are so many good things to talk about at the moment. We are in such a purple patch as a country, and I am looking forward to talking all about that.

Can I firstly just refer to the last speaker, Stuart Nash. He is all right, actually, Stuart Nash. He is all right. I welcome him to the economic development role in the Opposition. I am highly confident that he is not going to be ducking and diving down the irrelevancies and the rabbit holes that the “Red Rev.”, David Clark, used to, every few weeks. He is going to be a much better Opposition spokesperson—of that I am confident—and so, as I say, I welcome him to the role. I like the nice words he said about me, actually. It was very good. That is not why we are delivering so much investment into Napier at the moment—but we are. There is $25 million in roading investment, and I look forward to being back there later this year and being involved in the progress of some of that, because we are investing in an increasingly confident part of New Zealand, just as all of New Zealand has momentum.

Actually, while I am talking about Napier, can I also say it was great to be in Hawke’s Bay just, I think it was, last week for the Taniwha Dragon Economic Summit. It was remarkable what iwi had done there, getting in, and involving themselves with some significant Chinese interests. There was $100 million of investment into New Zealand done in the Hawke’s Bay over that summit, and it just shows you, I think, that really it is a metaphor, if you like, for what is happening in New Zealand at the moment.

I believe that when it comes to this Budget Policy Statement, when it comes to the Government’s books, when it comes to New Zealand, we are in a period of real momentum. I remember our former Prime Minister John Key talking about us being on the cusp of something great. The other side scoffed; they laughed. Well, actually, we are in it. I cannot tell you whether we are at the start of it or in the middle of it, but I can tell you we are in it. We are in a really exciting period in New Zealand.

Actually, it is funny, whenever they start scoffing, the good stuff happens. They declare a manufacturing crisis, and we see the manufacturing numbers go up. They talk about unemployment, and it goes down. We are not just talking about being on the cusp of something great; actually, we are in a very exciting period of time in New Zealand, economically speaking.

I am really excited to be a new Associate Minister of Finance, with Amy Adams, who has spoken in this debate. It is an incredibly rewarding job and a great time to be in the role, with Steven Joyce, who of course had a very long apprenticeship in the role. He has built up a huge experience as an Associate Minister of Finance to our Prime Minister, Bill English, when he was finance Minister. I am really enjoying the role, given the state of the country that we are dealing with at the moment. It is one of momentum, one of confidence, and one of optimism.

After all the doom and gloom from the other side, let us just think about the numbers that we see in that blue book that James Shaw is putting up. What it tells us is that, actually, following the plan that the Government has had for the last 9 years, through a global financial crisis, through a period when the developed world has found it incredibly difficult, has led us into a period when we have got an incredibly positive outlook for New Zealand.

That is not to say there are not issues. There are always issues with growth. There are always issues that keep politicians relevant. But we are in a strong phase domestically, where business is growing, jobs are growing, and wages are growing—actually, much faster than inflation. At the moment, over the next couple of years, there will be 3.5 percent growth, which is the fourth-highest growth rate in the OECD. It is one of the strongest growth rates in the developed world. Actually, 3 percent—we are a bit over, I think—over the next 5-year period. It is an incredibly strong period, and we are one of the strongest developed economies in the world. That is because great individuals, great families, and great businesses, in all manner of areas—because we are seeing an increasingly diversified economy—are getting in. They have the confidence to get in, to invest, to work, to be creative, and to have entrepreneurialism, and that is doing the business, literally, for New Zealand. Of course, we can take some satisfaction on this side—not enough; we have got more work to do. But our plan, as I say, has been working, and we continue to have new, fresher ideas to take the country forward.

We are, I think, ultimately, as a result of those numbers and the growth that we are seeing, a more confident country. We are a creative country, an entrepreneurial country, a diversified country, and a hard, smart-working country. I think, increasingly, whether it is Hawke’s Bay, which Stuart Nash represents, whether it is Tauranga, or whether it is Canterbury, we know the benefits of being outward looking, having a positive outward focus that is pro-globalisation and pro - free trade with the rest of the world.

All of that success to date does not mean there are not potential dark clouds, and I will come to those, in terms of protectionism and some of the things going on. But it does give us options as a Government about how we can do an even better job for New Zealanders, with the growth that we have.

We are clearly going to want to deliver better public services. We have done a fantastic job, with the likes of Hekia Parata in education, Jonathan Coleman, and Tony Ryall before him, in health, and many other social sector Ministers. We have ensured, every year, that those areas receive more funding. But, more than that, we have not been lazy with that funding. We have ensured that it is better spent, and that through social investment it is being spent in a way that gets results. So Better Public Services is a big part of our budgetary process to date, and will certainly be, in this next upcoming Budget.

Delivering infrastructure for a growing modern economy will continue to be, and will have to be, a real focus—again, whether it is Napier, whether it is New Plymouth, whether it is Auckland, whether it is Canterbury, or whether it is Southland, that will be a focus. I am really proud to play a role in that as transport Minister and communications Minister. In Kaikōura, because of the good choices we have made, because of the plan we have followed when very significant earthquakes have come, we have been able to back that area, to reinvest $1 billion to $2 billion in a new corridor, both highway and rail, in that area. The work goes on at pace, and we will be continuing to work hard on that.

Auckland—we continue to invest, at the moment, more than ever before in our biggest city. These are the biggest projects that New Zealand has ever seen. Regionally, in Taranaki—I talked about that in question time today. Earlier—a week or so ago—in Gisborne there has been significant investment going in there. In Northland—half a billion dollars, and a four-lane highway to the port, to back the success that is happening there. Paying down debt will continue to be a real focus for this Government, to around 20 percent of GDP by 2020, which, again, will allow us options and gives us an intergenerational equity with others. And, fourthly, as we can, we will be reducing the tax burden when we have room to do so.

I am really proud that we, as a country, under Bill English—who has shown a new, fresh, and dynamic style of leadership—are able to make a difference. We are able take a long-term view, whether it is on the superannuation issue, where moderate, sensible decisions over time continue to safeguard our finances and give us options in areas like health and education, over time, as people like me, frankly, live longer and healthier lives—touch wood—and as we bring ourselves into line with other countries.

We are also able to move really nimbly and adeptly with new trade policies and strategies in what is a fragile and uncertain world. I think that gives New Zealanders a confidence that this side of the House in Government is able to have the answers that keep us moving forward and keep us confident even in the very uncertain time that we are in. In contrast to the doom and gloom on that side, on this side we are excited about where we are. We are not just on the cusp of something great; we are in a fantastic time to live in New Zealand.

JAMES SHAW (Co-Leader—Green): It is a great pleasure to have the opportunity to speak in the Budget Policy Statement debate. It is particularly a great pleasure to follow Simon Bridges, who has talked a great deal about growth and about the Government’s enormous investment in growing investment in transport—for example, the blowout in the costs for the Warkworth to Wellsford motorway, estimated to cost between $1.4 and $1.9 billion, with a—oh, he has left; how about that—

Mr SPEAKER: Order!

JAMES SHAW: —I beg your pardon, Mr Speaker; I withdraw—with a cost-benefit ratio of 0.25. And that cost-benefit ratio was estimated when the cost was due to be $494 million, as opposed to—oh, look at that—$2 billion. So, yes, growth, and increasing investment in things that were supposed to cost roughly a quarter of what they are now going to cost, at a time when, even then, they had a pretty weak business cost ratio.

So the kind of growth that this Government’s members have been talking about in this debate—they have gone on a lot about growth, so I will just sort of say a few things about the kind of growth we are experiencing. We are having growing numbers of polluted rivers; growing numbers of endangered species; growing numbers of people living in cars and garages; growing numbers of young families who cannot buy their way into their first home; a growing cost of living for the elderly, who are increasingly hit by accommodation costs; growing costs of living for the bottom 30 percent of income earners, whose cost of living is growing extensively, and far faster than their wages are growing; and growing greenhouse gas emissions. Since this Government came into office we have had 19 percent growth in greenhouse gas emissions.

We have had growing numbers of communities that are on water restrictions and boil notices at the same time as we have had growing exploitation of underground aquifers by large-scale irrigation projects and water-bottling plants. They take that water out of the ground for free, while those same communities are on those boil restrictions.

We have had growing congestion in Auckland. The average Aucklander now spends 12 business days a year stuck in traffic, and that congestion is only getting worse. And that is at the same time that Mr Bridges has been growing the so-called investment—funnelling good money after bad into roading projects, which does not solve the problem, and, in fact, expands the problem.

We have had growing oil and gas exploration at the same time as we are pretending to put in place some kind of climate plan. We have had growing unemployment. There was growing unemployment in the last quarter. Cadbury’s, of course, is the latest manufacturing plant in New Zealand to hit the wall.

So this is the kind of growth that we are seeing in this country. It is the kind of growth that if it was growing on your body, your doctor would send you off to see a specialist.

When I hear members on the Government side talking about GDP as this Holy Grail, you have got to remember that all that GDP is is an estimate of economic activity. It is just activity. It does not say what kind of activity. It does not say whether that activity is any good, whether it is useful, or anything like that. You have an earthquake and you have GDP growth—right? So let us have more earthquakes, because that grows GDP. If GDP is the be-all and end-all, then going to war tends to increase GDP, so let us go to war because that is great for GDP growth, and we should be all for it.

We have got the kind of growth, but we do not have prosperity. What good is growth without prosperity? That is my challenge to the Government.

I think I heard Amy Adams saying that our growth was growing faster than other countries’ growth. When you consider the kind of growth that we are having, it is kind of like boasting that “My melanoma is growing faster than yours.” That, to me, is an entirely unhealthy way of looking at the economy, or the kind of useful activity that we could be seeing here.

Hon Hekia Parata: It’s ridiculous.

JAMES SHAW: I would like to respond—it is ridiculous, is it not, that you have got this kind of growth in this country? It is ridiculous that we are having such appalling results for our environment and for our people, even while all this so-called activity is going on.

I do want to respond to one of the points that the new chair of the Finance and Expenditure Committee, Chris Bishop, raised before. He was talking about what a bad idea it is to borrow to invest—it is somehow a bad idea to borrow to invest. Well, I tell you what, I have worked in a number of businesses that grew because they borrowed to invest. That is actually what you do. Actually, for anybody who can afford a house, what do you do? You borrow money—it is called a mortgage—and you invest it, in a house, and that has actually been a runaway activity in this economy over the last few years, Mr Bishop.

People borrow to invest all the time, and Mr Bishop was saying: “Let’s not borrow from the credit card.” Well, credit cards are running at 15 to 20 percent interest, but in this country you can get long-term bonds at 2 percent for 30 years. That is not credit card rates of interest. So if you want to borrow to invest, now is as good a time as any in recent history for a Government to borrow to invest in the things that it needs, whether it needs transport and infrastructure—we have got a huge deficit in our water infrastructure that needs looking after. It is a good time to borrow to invest in the things that all of our people can use to grow their businesses, to support their families, and so on.

Mr Bishop also said that the Cullen fund was set up as a place to invest the surpluses that the Labour Government consistently ran in every single Budget that it ran, and he is absolutely right. In every single Budget, it ran a surplus, and then it invested those surpluses in the Cullen fund. He said: “We’re not going to borrow to put money into the Cullen fund because we’re not running surpluses yet.” Well, here is the thing: if you keep cutting taxes, you stop running surpluses. The thing that staggers me is that the Government keeps saying: “Oh, look, we’re not going to save for the future. We can’t run these surpluses. But, by the way, tax cuts, everybody.”, and that, to me—if you want ridiculous, that is ridiculous. If you cut your revenue lower than your expenses, then obviously you are not going to run surpluses, and if you do not run surpluses, you have got nothing to spend on the Cullen fund. So that is why you are in trouble on the superannuation, Mr Bishop.

So it comes down to: what are your priorities? What are the priorities in Government here? We have seen this Government cut core public services—some to the bone. In health, Annette King has done a superb job of unveiling the real-terms cuts to the health budget over the course of this Government. In education, how many schools still have the same swimming pools that they had when any people in this Chamber learnt how to swim? How many of those schools are still completely free to attend? I venture it is very, very few indeed.

And here is a question: how many of those schools still have kids from all walks of life? Have we stratified to the point now, as a result of this Government—it has cut, in real terms, funding to State schools while expanding it to private schools, so that it is able to say that the quantum of money that is going to schools has increased.

In the Department of Conservation, it has a $424 million, real-terms, lower spend now than it had in the last year of the Labour Government. In real terms, we are $53 million a year worse off in the conservation budget than in the last year of the Labour Government.

Hon Maggie Barry: Over and over you repeat the nonsense.

JAMES SHAW: We do say it over and over again because it is true. In addition, a huge imbalance in the economy—

Hon Maggie Barry: Every time you say it, it’s wrong.

JAMES SHAW: Well, forgive me for doing the job of Her Majesty’s loyal Opposition. In addition—[Interruption]

Mr SPEAKER: Order!

JAMES SHAW: —we have the ongoing imbalance in the economy—[Interruption]

Mr SPEAKER: Order!

JAMES SHAW: —thank you, Mr Speaker—which is that in this country, because the Government continues to refuse to deal with the enormous imbalance of the tax advantage that property has over other asset classes, not only does that mean that the Government misses out on a source of revenue but it also means that we have runaway house price inflation and huge accommodation costs, which contribute to massive blowouts in the cost of living, especially for the elderly and for people on low incomes.

So the National Government has got its priorities all wrong. It has restricted its own revenue at the same time as pretending that that somehow means that it cannot invest in the future of Government superannuation.

It was St Augustine who said “God, make me chaste, but not yet”. This Government makes announcement after announcement to make it look like it is doing something, without actually solving the problem. In superannuation, electric vehicles, clean rivers, becoming predator-free—all of these are huge announcements, but they are devoid of results. When the Green Party gets into Government, we will be measured not on announcements and activity, but on results. Thank you.

FLETCHER TABUTEAU (NZ First): Thank you for the opportunity to speak in this Budget Policy Statement debate. I could literally give the same speech as I did this time last year, and in fact—

Chris Bishop: Oh, please don’t.

FLETCHER TABUTEAU: —I note that Mr Bishop actually did. It was like listening to a broken record from Mr Bishop over there. The reason why I cannot give quite literally the same speech is that things have got so much worse—so much worse. It has got to that critical point that any action now from this Government is too late. Any action that it takes now will be too late, and Government members have just spent the last hour telling us how good they are at not doing anything at all.

I want to just start my contribution by addressing some of the points made by Mr Bishop. I did want to add to the chorus of calls of “Bring back Mr Bennett” but that would be far too painful, so instead I will wish the new chair good luck in his role. But I note—oh, no, I do not think I am allowed to say that. Mr Bishop spoke about—and these were his words—“extremely good GDP”. It was an eloquent contribution, and when you look at that nominal value, that face value, of that number, 3.2 percent, it looks good. There is absolutely no doubt about it. But the reality is that GDP per capita paints a completely different picture of the economy as we move forward, and I will go into that in far more detail.

He spoke about how well things were going for New Zealand families, but we have literally 140,000 unemployed people in New Zealand as of today. We have 90,000 young people between the ages of 19 and 24 not engaged in employment or training or education. That is the reality of the figures that Mr Bishop gave us. He spoke also about average wage growth, but whose growth is increasing by that average figure? It is not the low-income earner. It is those already making so much money that the increase in their wages and salaries has skewed the average figure. We are being sold a set of numbers that on the surface do look good, but any kind of superficial digging shows them up for the ridiculous sales pitch that they are and which they are being used for by the members opposite.

Mr Bishop spoke about contributions to the Superannuation Fund, and he spoke about—I think, Mr Joyce earlier today also spoke about the surpluses that would be used. But let us get something straight in everybody’s mind right now. The Budget surpluses that this Government is claiming we will obtain in the near future will not be enough to pay off the interest on the Government’s debt that this country owes as a total. It is just absolutely—well, I cannot say what I want to say. What I will say, though, is that he did go off message. He did go off the script because he actually spoke about how the National Government could not actually achieve surpluses for the last 7 years. He actually admitted it in the House. It was rather refreshing to see. Year after year the Government has not, and was not able—

Chris Bishop: It’s a fact!

FLETCHER TABUTEAU: Yes, I know it is a fact, but you guys seem to struggle to tell the people in the House what the real numbers are and what the real situation is. So it was really refreshing, Mr Bishop, when you used facts to tell the truth of the situation. Brilliant! I really respect you for that.

All I can say to the new chair, actually, is that he spoke about the—what was it—prudent and wonderful ideas around superannuation and contributions to superannuation. No, it was changing the superannuation age—that is right—about how sensible it was and fiscally prudent going forward. Leave it alone, Mr Bishop. Leave it alone, National Party. You came in and campaigned on not touching New Zealand superannuation. You told New Zealand that it would not be changed. So, Mr Bishop, leave it alone.

In the past year, I touched on earlier in reply to Mr Bishop, the fact that GDP per capita has—well, some pundits say about half a percent growth and others say it is literally flat at zero, that the economy is truly stagnant if you measure it with just a little bit more accuracy rather than talk about GDP in and of itself. Just dig a little deeper, and the economy is standing still.

How about debt? I think the sales pitch from that side of the House was to talk about prudent management and safe hands moving forward. Well, what have those safe hands achieved for New Zealand? They have achieved one of the greatest debts in this country’s history—the greatest debt in this country’s history. That is what those prudent experienced hands have achieved for the people of New Zealand, and that is the Government’s sales pitch to New Zealanders. It has gone over $100 million. Minister Joyce talks about the ability to pay down debt but, as I said earlier, those numbers just do not add up. The interest on the debt alone is billions and billions of dollars and our surpluses are not there yet.

I think what we are really missing from the Budget Policy Statement in this half-year period is a vision or a direction. We are like a country that is kind of broken up in parts—

David Seymour: It’s a chain of islands—so, yes.

FLETCHER TABUTEAU: —and the first and foremost example that comes to mind—apart from being broken and in parts in the ACT Party—is the Electricity Authority, which has skewed its thinking and reinforces the Government’s attitude to a broken plan going forward; region fighting region, cities fighting against other cities and not working together, and the Government does nothing about it. What will happen, probably, if the National Government remains in power—and I dare not think about it—is we will move forward as regions fight against one another, and the Government will argue it is economic efficiency as industries die in towns and cities potentially fade from view. That is National’s economic plan.

What this Budget Policy Statement is really about is a Government that is stuck, that does not have any new ideas and cannot even seem to manage what it has got already. Government members talk about diversifying and growing a new economy. They cannot even get it right for the industries, our primary industries, that are here now. Our manufacturing statistics and our export numbers are going backwards as of today. In the most recent report out this morning, the numbers are going backwards.

Minister Joyce came into the Finance and Expenditure Committee to give us his vision of the future, and all he could talk about was how he was going to manage the housing crisis, but he dare not describe it as a housing crisis. It was just unbelievable. I have got so much more to say. I am frustrated at the moment with the amount of things to talk about—

Chris Bishop: Away you go.

FLETCHER TABUTEAU: —and yet, well, is Mr Bishop going to offer me more time from his party? Is anyone over there offering another 10-minute slot? I am happy to take it. Come on, Mr Macindoe.

Tim Macindoe: So much time to say so little.

FLETCHER TABUTEAU: Ha, ha! So I had better get to the conclusion and make the final point, because Mr Macindoe is chaffing in his seat. I have not spoken about the depth of the very real housing crisis that New Zealand is experiencing right now. People in New Zealand know the truth; they know about it. They know what the situation is and they know that the Government is not prepared to act and will not act. Those members over there must first acknowledge that they have a problem. They must face their reality, but they refuse to do so.

Auckland is clogged. The rest of the country is struggling as people on low wages are trying to find real hours of work, not the employed statistics we get where it is 1 hour a week—that is how they spin the data. Household debt grows as people borrow from week to week just to get through the day. These people now know that the Government making its rich mates richer is not helping anyone.

ALASTAIR SCOTT (National—Wairarapa): Well, where do we start? It is so depressing listening to Fletcher Tabuteau for 10 full minutes. There is nothing refreshing. There is no oomphy, punchy policy that they espouse or they pretend they think they have. There is nothing to Mr Tabuteau’s speech at all that was constructive. I would like to comment, firstly, on a couple of things that the lone member on the Labour benches, Stuart Nash—because he must feel pretty lonely. He is the only one who suggested that Labour has foresight. He talked about foresight, but, believe me, he is on his own. He is on his own. There are no new ideas. There is only ad hoc, expensive policy coming from the Labour benches. So, unfortunately, Mr Nash, you are a party of one on the Labour side.

Where do we start? Well, we have got a whole lot of good news. Unfortunately for the Opposition, there is a lot of good news to talk about. It has already been mentioned that there is a greater than 3 percent growth in GDP, low unemployment, more jobs—more jobs than ever before—and one of the highest labour participation rates on the planet, and, of course, there are more apprentices in the economy than ever before. It is not, as Minister Adams said, just in the cities; it is in the regions. I can say that in my own electorate of Wairarapa there is building framing going up wherever you might be.

There are more consents—in fact, in the last 12 months, in dollar terms, there are more consents than in the last 10 years from the Wairarapa electorate. There are people moving into the Wairarapa electorate from Auckland, from Wellington, and from the South Island. Why are they moving? Well, for a start it is a great place; it is a great climate. But they are moving because it is connected. There is ultra-fast broadband being rolled out into the regions. There is connectivity. There are better roads. The railway system has a new operator. Things are working very well for the Wairarapa electorate.

The question is: how are we getting there? How do we get to 3 percent growth? How are we getting these people employed in jobs? Why is it that we are cutting the Labour Party’s lunch when we continue to look after those who are most in need? Well, I will tell you what it is. It is because we support free-trade agreements, for a start—that is one of the things. We are an open, small market. We must continue to trade with the world to survive, to prosper, and to get ahead. So any party that does not support free-trade agreements is working against small businesses. It is working against small operators, exporters, and the agricultural sector. All these people rely on trading with the rest of the world. So that is the challenge to the Opposition, and particularly the Labour members who are there or thereabouts but unfortunately—and I will talk a little bit more—have lost a lot of credibility because they have tied themselves to the Greens. They have tied themselves to the Greens, and, unfortunately for them, that really reduces their mana, their credibility to the general electorate.

This side of the House is full of new ideas. It does have step-change improvements, and I will give you just one. I will just give you one example of where we are eating the Greens’ lunch, and that is the recently announced freshwater policy. They hate it. They hate it because they know it is a huge improvement on what has been and what was from the previous Labour Government, where there were no standards—no standards whatsoever. They did not give a toss about the environment. Nothing was done.

In the last 8 years we have had Minister Adams bring in freshwater standards. We have had Minister Smith continue to develop and set the aspirational goal of 90 percent of waterways being swimmable by 2040. We are not talking about the 540 parts per million; we are talking about the median of less than 130 parts of E. coli per million. That is a standard. That is a tough standard, but we aspire, we are ambitious, and we aim to have 90 percent of swimmable waterways by 2040. At the moment that number is about 70 percent, so we have got a long way to go. But the Greens just hate it. I will tell you that they also hate the hugely aspirational goals set by Minister Barry to be pest-free by 2050. Again, we are eating the Greens’ lunch. We are eating the Greens’ lunch, and they do not like it.

There are a whole lot of new ideas coming from this side of the House, such as raising the age of superannuitants’ entitlement. This is sensible and pragmatic. We are living longer—why would we not raise it? Twenty years is a long time for people to adjust. I am—how old am I now? I am 52, and I never thought, when it was discussed in the 1990s, that I would ever receive superannuation, but I will do. We continue to grow older and live for longer and 67 is a very reasonable and fair age and, quite frankly, it is just the right thing to do.

I would like to talk a little bit more about why I think the Labour Party is losing credibility. There was a lot of discussion today, and in the last couple of days, around contributions to the Cullen fund, the Superannuation Fund and the disingenuous idea from Mr Robertson that we should have, could have, would have invested in the Cullen fund over the last 8 years. Well, I ask that member how much he borrowed to invest in the sharemarket on his own account—on his own personal account. How much did any of the Opposition members borrow to invest, on their own account, into the sharemarket if it was such a no-brainer thing to do and if it was so obvious that these contributions should be made by borrowing money?

And then the second question is: if he did not do any of that over the last 9 years, how about today? How about today? How much money has Mr Robertson borrowed today or how much is he planning to borrow for the next 12 months to invest in the New Zealand equity market or the Australian equity market or, in fact, any equity market on the planet? How much is he willing to borrow and how much is he planning to borrow for the next 12 months—just the next 12 months—on his own personal account because it is apparently such a no-brainer? It is such an easy way to make money—there is a free lunch and that is the way to do it! Well, I am sorry, Mr Robertson, but that is totally disingenuous and that sort of comment is why the Labour Party lacks credibility.

The people of New Zealand understand that that is a “Harry Hindsight” perfectly 100 percent global—what am I trying to talk about—crystal ball. It is a crystal ball and it is just a wish list. It is just Pixieland. He is a dreamer. It is like saying: “Oh, I should’ve put 10 bob on Donald Trump in 2008. It was so obvious that he was gonna win. I should’ve put 10 bucks on Donald Trump.” Well, that is why the Labour Party lacks credibility.

The Greens even talked about borrowing to invest in the equity market. The analogy was that lots of people borrow to invest in a house. Well, that is a completely different class of asset. It is a completely different leverage amount. What you are doing when you invest in a sharemarket is you are investing into instruments that are already leveraged. Companies already borrow on behalf of their shareholders. So for someone to borrow to invest in something that is already leveraged is just dangerous. It is just ludicrous that a Government would encourage that and borrow to do that.

So those two guys—the Greens and Labour; Huey and Dewey—investing and managing on the taxpayer’s behalf is just a scary thought, and that is why they cannot, and should not, be on the Treasury benches, and they will not be, post the September election. As I say, the people of New Zealand understand what is right, they understand what is fair—and I am talking about superannuation—and they also understand what is a reality. That argument that both those parties have put forward vis-à-vis the Superannuation Fund is a nonsense.

This side of the House is working every day for the benefit of all New Zealanders. We set aspirational goals for New Zealanders. We trust New Zealanders with their own money, and that is why the Minister of Finance today talked about tax cuts rather than doing other things—because we know that people can do the right thing for themselves, for their families, and for their communities if they are given a chance. And that is what Kiwis love—just to be given a chance. Thank you.

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

JULIE ANNE GENTER (Green): Tēnā koe, Mr Assistant Speaker. What kind of society do we want? That should be the question that we ask before we debate Budget policy. Do we want an Aotearoa where rivers are clean and safe enough for our kids to swim in them? Do we want an Aotearoa where every child has a warm, dry home, the ability to walk and cycle safely to school, and nourishing food that enables them to grow and learn? Do we want an Aotearoa where everyone has the basics that they need to live a good life and an opportunity for meaningful work with fair pay? Do we want a world with a stable climate? And do we want important contributions like looking after children or looking after the elderly, teaching, cleaning up pollution in our natural environment, cleaning up our offices after we work in them—do we want the people who do those jobs to be able to do that work at their best and to have the resources they need to live good lives? I think the answer to all those questions is, obviously, yes.

When it comes to the Budget, this National Government is continually claiming that we cannot afford to do the things that matter most. It frames the questions in such a way that we are always asked to make impossible trade-offs. So we are asked to give up the idea of protecting our pristine natural environment—the place that is most precious to us—for some jobs. We are asked over and over again to give up critical Government services that help make our society fairer so that the most well-off people can pay much less tax. And we are told we cannot make long-term investments into clean infrastructure that would benefit the whole country in the long term—like keeping and extending the use of our electric freight trains, or investing more rapidly in affordable rail and light rail public transport in our towns and cities—because it would cost billions and billions of dollars. Well, the Government is already spending billions and billions of dollars on infrastructure; it is just not clean and it is not going to help us in the long term.

We have an unfair system of allocating resources at the moment, and it results in the concentration of wealth, which means that some people will never have the equal opportunities to live a good life. And National is actively choosing to allow that unfairness to persist by prioritising tax cuts over critical public services or prioritising asset sales over critical public services. We want people to have access to the public services they need to be able to have meaningful work and to have equal opportunities, and we can do that if we have a Government that shows leadership.

National’s refusal to do anything to truly protect and clean up our waterways, to incentivise sustainable, diverse agriculture, is quickly eroding the things that we love most about Aotearoa so some vested interests can continue making some short-term profits without having to do the hard work of protecting our waterways. We want to protect our natural environment; most New Zealanders want to protect our natural environment. They know it is a birthright for our kids to be able to swim in our rivers and lakes. We can create jobs by doing so if we have a Government that is willing to show leadership.

Budgets are all about priorities, and the people of Aotearoa do not have a difficult choice to make. Vote with your values. Vote for the things that matter most to you. Do not let anyone tell you that we cannot afford clean water, that we cannot afford fair pay, that we cannot afford ending child poverty, and that we cannot afford to invest in the long term for a clean, stable climate and the infrastructure that is going to enable us to create the jobs that will not rely on increasing fossil fuel pollution. We can do all of these things. We have the opportunity to make those choices.

The Green Party is not afraid to say that we will show leadership. We have the policies that will prioritise the things that matter most to New Zealanders, that will protect the things that New Zealanders care about for the long term. Kia ora.

The ASSISTANT SPEAKER (Lindsay Tisch): I call Jami-Lee Ross—5 minutes.

JAMI-LEE ROSS (National—Botany): It is pleasing to speak on this Budget Policy Statement. We miss Julie Anne Genter on the Finance and Expenditure Committee. I am sorry that she got bumped off, for James Shaw. She was pretty good on that committee.

She talked a lot about leadership. I want to say I am proud of the National Government and the leadership that we have been showing—the leadership that we have been showing to see more kids being educated in this country, to see more New Zealanders are healthy, and to see more elective surgeries in this country, to see 1,100 more police officers going on to the streets of New Zealand, to see literally—listen to this, Julie Anne Genter—hundreds of millions of dollars committed to cleaning up waterways in New Zealand. We are showing leadership, and the Budget Policy Statement that Bill English, as finance Minister, put together and now Steven Joyce is presenting as finance Minister shows the leadership that we are showing.

We are also showing leadership on responsibly managing the economy and not spending up large trying to buy elections, like we have seen in the past. I love this graph. I love this graph in the Budget Policy Statement. It shows red lines, which was Labour’s additional spending, and it shows blue lines showing National’s additional spending. We have committed to another $1.5 billion in operating expenditure over and above the previous year, through this Budget Policy Statement.

There is a huge line in 2008 showing Labour’s $7 billion spend-up to throw at the 2008 election. Labour can never stand in this House and say it was responsible with the Budget, when it threw literally billions of dollars trying to win an election. We are responsible, we are doing things properly, and we are delivering for New Zealand as well.

Leadership, Julie Anne Genter, is seeing 130,000 people gaining jobs in the past year. Leadership is seeing the average wage going up at a much faster rate than the rate of inflation. Leadership is seeing more children succeeding and fewer children living in benefit-dependent homes. Leadership is showing that there is an opportunity for people out there and that welfare dependency is not the future. Lowering the long-term welfare costs to the Crown by $10 billion, because we are getting people off welfare, getting them into work—that is leadership.

When the Minister of Finance appeared before the Finance and Expenditure Committee we focused quite a bit on migration during the interaction with the Minister as we examined the Budget Policy Statement. One of the brilliant things about the past 8 years is we are seeing New Zealanders returning home. We are seeing New Zealanders vote with their feet, decide that they want to back New Zealand again, and come home to live here. They have decided that the golden days that they saw in Australia and other parts of the world are no longer golden days compared with New Zealand, and they are deciding to vote with their feet. We are seeing literally tens of thousands of people, who previously were leaving our country every year, now deciding to come home.

If the Labour Party and the Green Party want to ask themselves “Do New Zealanders decide that the National-led Government is showing leadership?”, the answer is “Yes.”, because tens of thousands of them are returning home. That has its challenges on infrastructure, it has its challenges on housing, and it has its challenges on Government services, but the bottom line is that we are doing better for New Zealanders and we are showing people there is a brighter future here in New Zealand.

Housing is, of course, a challenging area that we must maintain. I was pleased to see that the Minister of Finance has not ruled out debt-to-income ratios but he has also not said yes to the Reserve Bank on that. I highlight that in my speech here in the House today because it was an area I took a lot of interest in when the Finance and Expenditure Committee was examining the Budget Policy Statement.

We need to ensure that there is more supply of housing for New Zealanders so we can buy houses. We need to ensure that there is assistance for first-home buyers, and we are doing that as well. Allowing the Reserve Bank too much rope, which it may use in a way that may be detrimental to New Zealanders’ ability to buy houses, we need to be cautious on. I was pleased that the Minister of Finance did not jump at the debt-to-income ratio scenario that the Reserve Bank was putting in front of him.

The bottom line is that New Zealand is achieving more and more every single year under Budgets put together, firstly, by Bill English—now he is Prime Minister—and that will continue under Steven Joyce. I am proud to be part of a Government that is showing leadership. I am proud to be part of a Government that is investing appropriately in New Zealand. We will continue to see tens of thousands of New Zealanders voting with their feet into the future as well, coming home to their home country.

DAVID SEYMOUR (Leader—ACT): It is a pleasure to speak in this honourable House on behalf of the ACT Party in this Budget Policy Statement debate. I mean that quite sincerely, because to have a Budget Policy Statement published by the Government, required by statute, to actually set out what the Government’s intentions are, how much money it intends to take out of the private sector as a percentage of GDP, how much it expects to spend, what it expects its net position to be in terms of debt and liabilities—to have those transparently displayed for all to see, months before the Budget is actually brought down, makes us a sophisticated country with transparent and open Government that is accountable to the people. I think we should never forget to pay tribute to those of us who went before us in this House, such as Ruth Richardson, who put in place the public finance frameworks that we have today that make us a well-governed country. I think we should all agree on that, no matter which side of the House we are from.

Putting that aside, I think it is worth actually looking at what those numbers tell us. One of the things they tell us, which runs counter to the narrative that we hear so often from the Opposition and out in public, is that this Government has very, very low net public debt. At around 23 percent of GDP, it is among the lowest net public debt figures in the world. This Government has more room on its balance sheet than just about any other developed country, and far more room than the really troublesome countries such as Greece and Portugal, which have around 180 percent of GDP—almost nine times more debt on their Governments’ books than we do.

What is interesting, and is not included in the Budget Policy Statement but perhaps should be, is the level of private debt—that is, household debt held by people other than the Government who live in New Zealand and have borrowed. That figure is truly alarming. Although we have some of the lowest public debt in the developed world, we also have some of the highest private debt—that is, people borrowing on their mortgages, borrowing on their credit cards, borrowing through their banks to do a variety of things, and borrowing through finance companies. We are among the most indebted countries on the planet. That lends you to ask: what should we be doing when the public sector balance sheet is in fantastic shape and the private sector balance sheets are looking a bit edgy?

Also in this Budget Policy Statement is the observation that the Government is about to go into surplus, not just little surpluses but huge surpluses—$20 billion of surplus, nearly 10 percent of GDP over the coming few years. I just have to laugh when Fletcher Tabuteau gets up and says that the surpluses will not cover the interest on the Government’s debt. Well, if Government debt is 23 percent and the Government’s cost of borrowing is 4 percent, that means that the interest repayments are about 1 percent of GDP, and the surplus is coming down the line at 2 or 3 percent of GDP. Clearly, the surpluses are going to be far greater than the interest on public debt. If Mr Tabuteau wondered about that, he might have asked himself a simpler question, which is: why is the forecast for debt as a percentage of GDP to go down by about a percentage point a year for the next 4 years? Well, it is either because the economy is going to grow very, very fast or because the overall amount of debt is going to reduce. But I digress.

If we have got a public sector with a very strong balance sheet and a private sector with a little bit of a stressed balance sheet, then there is a very clear thing that should happen when those big surpluses start coming down the line, and that is that it is time for tax relief. When Michael Cullen introduced the top tax rate of 39 percent, it was for only so-called “rich pricks”. Only 5 percent of taxpayers were to pay it. Coming into this year, we are going to see half of all taxpayers earning over $70,000 and paying the top tax rate. The Government’s refusal to adjust those tax brackets for inflation has meant more and more hard-working Kiwis drifting into the top tax bracket, with someone on $71,000 paying the same top tax rate as a billionaire in New Zealand. That is wrong. The ACT Party says that nobody on a five-figure salary should be paying the top rate of tax. We need to move those brackets and give people tax relief. Not only is it right to reward people for their effort by letting them keep more of the money that was theirs in the first place, but it is also the sensible thing to do given the high levels of private debt and low levels of public debt that we currently have.

You have to pay tribute to Bill English for that scenario, because we have actually had a period of fiscal restraint and relatively smart investment in public services over the past 8 years with Bill English as the finance Minister and now as the Prime Minister. That is why when the parties line up in this House, I am very proud to be leading an ACT Party that keeps those people over there and these people over here. I am very pleased to see Bill English, and now Steven Joyce, as finance Minister because I know from the Finance and Expenditure Committee how hard Grant Robertson works and how strong his grasp of the detail is. That is why we have got to keep him over there, so he never becomes the Minister of Finance.

That does not mean that everything is rosy under the current Government. One thing that is not in the Budget Policy Statement but perhaps should be is superannuation. It has been a big topic this week. The Budget Policy Statement says that when public debt returns to 20 percent of GDP or below, we will resume contributions to the Cullen fund, or the New Zealand Superannuation Fund. That is nutty economics. Nobody in this House, if they have got a brain, would borrow money against their mortgage or forgo mortgage repayments in order to trade in the global sharemarket. As Chris Bishop made the point perfectly adequately earlier, it is always easy to have 20/20 hindsight in markets. If anybody in this House knew what the sharemarket was going to do in the next 10 years, they would not have to fundraise for their political party ever again. If they are not prepared to do it with their own money, they should not be investing taxpayers’ money in the global sharemarket.

Whatever happens with the New Zealand Superannuation Fund, we still have a serious problem with the long-term affordability and sustainability of NZ superannuation, and particularly with the fairness. People can always say: “Oh, well, you can afford anything if you make it a priority.” That is true—that is true. We could put the age of entitlement for superannuation back to 60 years, and people in my generation could pay the taxes to fund that for the rest of their lives. Technically true—that is possible, but it is not fair. That is why it was a fantastic revelation this week that the National Government does understand that the scheme requires adjustment, but, sadly, yet again it has missed the point of intergenerational fairness. By ensuring that there will be no change for the next 20 years, we are going to see younger generations paying $58 billion of extra tax to maintain superannuation at 65 for the baby boomers. As soon as they have all retired, the adjustment will be made.

New Zealanders under 45 are spewing, not just at the money and the mathematics of this but at the injustice and the snubbery that they have experienced at the hands of the Government with this proposal. If they had the guts, if they had the leadership that we heard about from the previous speaker, they would do it fairly; they would start gradually, incrementally increasing the age of entitlement to New Zealand superannuation, and they would do it starting as early as 2020. That would bring us into line with Canada, the UK, the US, Belgium, the Netherlands, Australia—all of the countries listed in the National Government’s own puff piece on its policy, all of whom are adjusting their ages of superannuation entitlement in the 2020s. It is not because they cannot afford to do it later, but because they have regard to fairness between generations and they want to make the adjustment now rather than waiting until all baby boomers have retired.

In conclusion, we are fortunate in New Zealand to have a Budget Policy Statement, to have the level of transparency we have, and we are very fortunate about the figures that it shows. We are in a good space publicly, but we need to have tax relief for our private sector, and we need a little bit more gumption when it comes to confronting our long-term challenges, such as those we regard in superannuation.

MICHAEL WOOD (Labour—Mt Roskill): It is a pleasure to speak on the Budget Policy Statement. There are two things that I want to focus on in my statement, and the first is quite a unique one, given some of the speeches we have heard from the Government benches, and that is to actually talk about the Budget Policy Statement, which is this document here. The second one that I want to bring to the House’s attention is one that we have not heard much of from the Government benches either, and that is a little trip I want to take outside the comfort of this Chamber, out into the real world, a little bit later in my comments, to talk about what people out there actually living real lives in New Zealand might have wanted to see in this Budget Policy Statement.

I sat through the first couple of speeches from the Government benches. I heard from Mr Chris Bishop and the Hon Amy Adams before premature rigor mortis set in. I managed to hear their comments, and I just want to reflect on some of the comments that they put forward there.

The first came from Mr Bishop, and it was like trying to grasp at a pillar of smoke over in the corner there, because as I looked towards him, I wanted to grab on to something to respond to in respect of this debate, but there was precious little in terms of the Budget Policy Statement. In fact, I timed it. I timed it, and we got to 9 minutes and 33 seconds until Mr Bishop actually mentioned something substantive about the Budget Policy Statement. The first 9 minutes and 33 seconds were all about the Labour Party and, of all people, Russel Norman. I know Russel Norman has grown a spectacular and luscious beard, which Mr Bishop may well be very interested in, but it was not really that relevant in respect of the Budget Policy Statement debate.

What he did get on to talking to was another matter that is of substance but, of course, it does not actually relate to the Budget Policy Statement, and that was the Government’s lack of contributions to the Cullen superannuation fund here. Even though that matter does not relate directly to the Budget Policy Statement because the Government is not contributing, the sheer intellectual dexterity and gymnastics that Mr Bishop put into constructing his argument do warrant some form of response. What Mr Bishop put up was this contention—he put up this contention. In justifying the Government’s lack of contributions over the last 8 years, he argued that if the markets had not gone up and if we had not received consistent returns, then that lack of investment was justified.

So what he was actually doing was constructing a parallel universe argument, because the fact is that we have had consistent returns of 8 percent every year, compounding, over the last 8 years. It is not a matter of hindsight; it is a fact that that was the case. If the Government had had the foresight to put that investment in instead of blowing it away in a smoke of tax cuts in the 2010-11 Budget, we would be significantly better off in terms of meeting our future obligations to future superannuitants. We know that out there somewhere in the universe, in a parallel universe, there is “Planet Key”, and now there is a small satellite circling it called “Bishop 33”, in which the Cullen superannuation fund did not earn compounding returns of 8 percent per year over the last 8 years, like it actually did here in the real world.

To give her her due, the Hon Amy Adams did engage in the substance of the Budget Policy Statement, and I think—like the Government in many respects—what she put forward were some words that sounded good. I believe that she is a well-intentioned Minister, as are many of the Ministers and members opposite. But what you get when you actually delve into those words is a significant gap between the rhetoric, which sounds good, and the actual delivery for real people on the ground.

So let us take some of the statements that she made. The first one she said—and we can all agree with this; every member from every party in this House—was that one of the jobs of the Government is to keep New Zealanders safe and to help them get ahead. Of course we would want to see that, but what do we actually see on the streets of my electorate and of many electorates around the country? Record numbers of burglaries in our community, a 94 percent rate of burglars getting away with it, police foot patrols that have been reduced over the last 5 years, and in Auckland—our biggest city, our growing city—about 10 new cops, net, over the last 8 years, and it was only after wrestling between Judith Collins and the Prime Minister over the last year that we finally got some action on that. So, fine rhetoric there, but no action.

What about people getting ahead? Well, again, we would all agree with that. We all agree with the notion of opportunity so that New Zealanders can reach their full potential in life and contribute to society. That is what everyone wants. But what does it actually mean when we have got 90,000 young people not in education, not in work, and not in training? That is 90,000 young people full of potential, full of ideas, and with the ability to do good things, if only they had the support of a Government that would actually back them and put the resources in to make a difference in their lives.

We also heard from the Hon Amy Adams that we want a system that creates opportunities and looks after our most vulnerable. Well, tell that to the Māngere budgeting centre. Its people are actually out there in the community doing the mahi, looking after our most vulnerable, and helping low-income people do what this Government tells them they are supposed to do—getting their financial affairs in order. What does the Māngere budgeting centre have to do under this Government to keep itself going? It has got to run sausage sizzles at the weekend because this Government fails to provide the support to those essential community services, and there are many groups like this in my community, as well, that are struggling under the fiscal constraints of this Government.

We heard that this Government supports wages rising. Well, what about the 45 percent of New Zealanders who, in amongst that fog of the average statistic, did not get any wage increase last year? And you can bet your bottom dollar that most of those people were people on relatively low incomes.

We heard from Minister Bridges, as well. He is a fellow Gen Xer—a bit like me, I think. We grew up through the 1990s, and for that reason I give him the Seinfeld award for irony for describing the new Prime Minister, Bill English, as “new, fresh, dynamic leadership”. Then Minister Bridges, in 10 minutes, and this is the finance Minister—sorry, maybe he wants to be the finance Minister. The Minister of Transport, in his 10-minute speech on the Budget Policy Statement, at the same time as Auckland faces a transport crisis and is grinding to a halt, did not say one thing about investing in public transport in our biggest city—not one thing.

So it is on that note that I want to take members in this Chamber on a little bit of journey through the real world of my constituency in Mt Roskill, where many ordinary, decent people live who want all of those things that we have just talked about. My day in Mt Roskill might start with a morning trip down Dominion Road, where thousands of people—thousands of people—are stuck in congestion. They are annoyed, frustrated, and are having their time and their economic energies wasted, just like people on major arterial roads across Auckland.

All the members in this Chamber who live in Auckland know about that, and they know that it is not good enough, but what do we get from this Government? Do we get a transformative vision, a transformative plan, to actually invest in modern public transport like every other smart city around the world? No, we get more roads. We have just heard, of course, about the big investment in the road heading up to Northland. What is the cost-benefit ratio coming from this Government, which boasts about its fiscal responsibility? It is 0.25. For every dollar we invest in it, we get 25c back, but no investment in public transport.

After my journey down Dominion Road, I will get to my office, and I guarantee you this, because every day I get into my electorate office there are cases waiting. Cases are waiting. People in desperate housing need, usually young families with children, are often living in overcrowded conditions with relatives, with their kids getting sick. Can they find the social housing place that they need? No, they cannot. There are 4,000 families in Auckland—4,000 low-income families who cannot get the social housing places that they need.

On that note, when we heard the Budget Policy Statement submissions in the Finance and Expenditure Committee, we had a very good submission from Caritas, and it noted this about the social housing places offered by this Government. In 2013-14, there were 69,000 of them. Today, in 2016, although we all know that the housing crisis mounts and mounts every day, there are now 61,000 places—a reduction of 8,000.

The Minister for Social Housing will stand here and tell us about the Government’s great plans to invest in 6,000 more income-related rent subsidy (IRRS) places. Well, let us take her at her word. If this Government puts its money into 6,000 more IRRS places by 2020, we will still have 2,000 fewer social housing places in 2020 than we had in 2013-14, and that is the measure of this Government’s commitment in that area.

A man whom I admire very much, an American theologian called Jim Wallis, said that Budgets are moral documents, and that is because they have a very real role in shaping the lives and the aspirations of the people of our country. What New Zealanders deserved to see, and needed to see, in this Budget Policy Statement was some vision, some idea of transformation, and a plan for tackling the housing crisis so that young New Zealanders who work hard can actually have some hope and can have some belief that they can get a house and make a start in their lives. Aucklanders need to see a transformative vision around transport so that we truly can become the first city of the Pacific, as we should be, and small-business owners deserve to see investment so that they can get into housing and so that they feel safe in their small businesses instead of being plagued by crime.

We did not get that. We deserved better. But I hope to come back to this House next year and hear Andrew Little presenting a Budget Policy Statement that delivers just that. Thank you.

ANDREW BAYLY (National—Hunua): That hope expressed by Michael Wood will be a forlorn hope. It is a pleasure to be talking on the Budget Policy Statement but, before I do so, I just want to turn my attention to the events that are unfolding in my electorate of Hunua. They are also happening in Coromandel and Waiheke, and that is the extent of the flooding that is occurring in my electorate, which covers the areas of Hunua, Clevedon, Beachlands, Maraetai, Kawakawa Bay and Ōrere Point.

There is significant damage, but I have spent the afternoon talking to the fire chiefs and the police. They are doing a fantastic job in terms of helping those communities. Luckily, the 350 children who were at two camps have been rescued safely and no one has been injured, with the help of not only the fire brigades and the police but also the army. We have also had a number of vehicles recovered, including the police vehicle that was reported on by the media. That has now been recovered by the Clevedon Fire Brigade. But the hard work that all those five fire brigades have been doing has been fantastic. Since midnight last night they have been out helping everyone, and I just want to pay my tribute to all their hard work.

There are still a number of road closures, although I have just been made aware in the last few minutes that the road from Kawakawa Bay to Clevedon has now been opened. But the area of Ōrere Point south to Kaiaua is still closed and we have got the closure of a road around the Maraetai coastal route. The extent of the stock damage and loss of property is terribly significant. Luckily, everyone is in good order but we do have more rain forecast and we are all hoping that everything will be OK. My only words of wisdom and guidance are: “Make sure you look after your neighbours. Check them tonight. Don’t use the roads unless you have to. Keep safe, and we will all get through this together.”

I now want to turn to the Budget Policy Statement. I have got to say this is a great statement at any point in time. If we were in any country everyone would be holding up this statement saying: “These are great results.” When you look at the average GDP growth rate for the next 4 years—well over 3 percent—that is fantastic, given the international context that all countries are currently operating under, and we are well aware of those pressures that we are seeing across whole swathes of countries overseas. We have got an unemployment rate of 5.2 percent, but Treasury is now predicting that is going to reduce to about 4.5 percent over the next few years. We are generating surpluses, and it is interesting that the financial statements of the Government just released—just released—show that for the 7 months to the end of January we reported a surplus of $1.14 billion, which is miles ahead of the budget that Treasury forecast, which was close to about $440 million.

That is a significant advancement, and a lot of that is coming through higher taxation revenues and prudent management—and of course we do have to acknowledge the fantastic work that our Prime Minister did as the finance Minister but it will continue under the new finance Minister, the Hon Steven Joyce. I think this is all about managing an economy appropriately and with fiscal responsibility. So our debt level is below what we anticipated. It is 24.1 percent. And, as everyone knows, I believe—hopefully, across the House—we are trying to get to 20 percent by 2020, which is very low by comparative standards.

So why does all of this matter in terms of economic outcomes? Well, what it provides is money for investment, and I just want to look at three areas. The first one is around infrastructure. It is interesting that if you look back over the last 5 years, this Government has invested $18 billion into infrastructure projects. That includes things like modernising our hospitals all around the country. It is about upgrading our broadband—and only in February we announced another major initiative so that we are seeking to get 85 percent of all New Zealanders connected to ultra-fast broadband by 2024. That is a fantastic achievement when again you compare that with other countries around the world.

We have got schools. What the Hon Nikki Kaye is doing in building new schools is phenomenal. I have got one just announced this week, Flat Bush South, and I have also been and visited a brand new school that opened in Ormiston just in early February, and it is a fantastic building.

And, of course, roads, and I heard the previous speaker talk about roads. Well, actually the plan for the next 10 years is $43 billion to be spent on roads. Although that sounds a lot of money—it is—it does not always deal with all the pressures that we are experiencing. But in Auckland we have still got the Waterview tunnel coming on stream, in operation, in the next couple of months. We have got the commitment to the Pūhoi to Wellsford road, we have got the Government taking over the Onehunga road—about a $700 million road—triple laning down to Papakura, and the electrification of the rail line down to my electorate in Pukekohe. This is all good stuff, but we also are seeing massive investment in roading all around the country. The Hon Simon Bridges seems to be constantly out there opening new roads, which is great, and that is what New Zealanders demand and want.

The other thing is that there is a significant investment in social infrastructure. There is the work that the Hon Paula Bennett and the Hon Anne Tolley are doing around this, and obviously now, with the changes we are making, the work is about changing the culture around vulnerable children and putting the child at the centre of how we organise ourselves. That is a courageous move, it is a tough move, it will be hard to achieve, but I am glad that people like Anne Tolley are doing that.

There is also the $350 million that we put up for social housing initiatives to help vulnerable people, particularly women with young children. It is appropriate that we put money up, and a substantial amount of money, to look after them and keep them in safe places until we can find them proper homes. There is also the $2 billion that we spend every year—$2 billion that we spend every year—supporting people to rent properties all around the country. The $2 billion is so that they can have good houses and look after themselves and their families.

The other thing that we have heard reference to is the $500 million that has just been announced into policing, and that was a great announcement in January. There will be 880 new sworn officers all around the country. Also, on top of that, there will be all the people who will be hired to help with forensic scientific investigation around crime—all that good stuff. That is phenomenal, and of course all of us would like to see it happen earlier but we do have to go and recruit 220 new officers every year to achieve that outcome. Of course, what we are trying to achieve is to make sure that every New Zealander lives within 25 kilometres of a manned police station in New Zealand. That is a great thing and makes our communities feel much safer.

I have got to say that yesterday we witnessed a dismal display. In fact, I was quite shocked. One of the important roles of the Finance and Expenditure Committee is to deal with tax matters, and we had a whole lot of proposals we were working our way through with regard to closing tax loops: stopping foreigners using certain vehicles, stopping base erosion profit shifting, and interest rate charges and use of branches—a whole raft of things. Also more recently we have discussed the changes to the way that small companies can pay their tax as they go.

What we heard from members of the Labour Party was, in fact, the complaint that we were doing too much—the complaint that we were doing too much. I could not believe it. I was absolutely appalled. I listened to the Opposition spokesman on finance as he sort of robotically rode his way through a debate speech that seemed to be of interminable inconsequence. I was horrified. Where is the Labour Party of old? Those members are the ones who should be holding a Government to account in terms of making the tax system fairer, but no.

And then we turn our mind to some members of New Zealand First. Mr Fletcher Tabuteau has been a good member at times, but you know that when we came to this issue and working through the detail, where the real work takes place—who did the heavy lifting? Who? It was the National Party members on that Finance and Expenditure Committee, and it was dreadful to hear the Opposition members talking about too much, too fast. Well, what I say is: bring on the hard work, because we want to achieve great outcomes for New Zealand. Bring it on.

A party vote was called for on the question, That the House take note of the report of the Finance and Expenditure Committee on the Budget Policy Statement 2017.

Ayes 63

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

Noes 57

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

Motion agreed to.

Bills

Crimes (Increased Penalty for Providing Explosive to Commit Crime) Amendment Bill

First Reading

Debate resumed from 7 December 2016.

The ASSISTANT SPEAKER (Lindsay Tisch): Members, when we were last debating this bill, Alastair Scott had the call, and he has 6 minutes remaining to speak, if he wishes.

ALASTAIR SCOTT (National—Wairarapa): I had a couple of minutes explaining some of the problems with the—

Kris Faafoi: Start again—start again.

ALASTAIR SCOTT: I am not going to start again. I would not want to put you through it all. I will do the last 5 or 6 minutes, and we were talking about the inconsistency in the Crimes Act. Providing an explosive to someone for the purpose of an offence is objectively worse than carrying an offensive weapon—that is what the bill is all about—so the maximum sentence should be higher. A maximum 5-year imprisonment is needed to adequately reflect the seriousness of the offence and to deter others, without being unnecessarily harsh. The offence does not have a minimum penalty, and so when sentencing of this offence arises in court a judge can impose a fair and reasonable penalty without being restricted to a maximum of 2 years’ imprisonment.

The Government is committed to reducing crime and making our communities safer. We are boosting police staff by 1,125, including 880 extra front-line officers as part of our half-billion-dollar Safer Communities package. This means increased staff numbers across all 12 police districts—

The ASSISTANT SPEAKER (Hon Trevor Mallard): Order! [Interruption] Order! The member will resume his seat. There has been some criticism, especially in submissions to the Standing Orders Committee, in relation to what might be described as sort of slack chairing with regard to relevance for debate. I am going to be quite strict and ask the member to speak to the bill, rather than—[Interruption]—having a more general debate. When I sit down, I am going to ask the member who interjected when I was on my feet to withdraw and apologise.

Kris Faafoi: I withdraw and apologise.

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

ALASTAIR SCOTT: I raise a point of order, Mr Speaker. My understanding was that a second reading speech should be very specific to the bill, but a first reading speech could be broader and more wide ranging than a second reading speech.

The ASSISTANT SPEAKER (Hon Trevor Mallard): It can be wide ranging around the bill, but it cannot be a rehearsal of Budget debates or debates that have been held earlier in the year.

ALASTAIR SCOTT: Thank you, Mr Assistant Speaker.

Stuart Nash: That is one way to wind down the clock. Just do not say anything.

ALASTAIR SCOTT: I want to be specific, so just give me a couple of seconds.

The ASSISTANT SPEAKER (Hon Trevor Mallard): Should I make it clear to the member that there is not an obligation to use the full time if the member is not prepared?

ALASTAIR SCOTT: No, I accept that. I accept that, Mr Assistant Speaker. I will summarise. This is about the inconsistent sentencing guidelines in the Crimes Act. Under section 202A, individuals simply carrying or possessing dangerous weapons unlawfully are potentially liable for a longer imprisonment term than an individual who knowingly provides explosives intended to endanger people or property. That is the nub of it, and that does not make sense to me. A person carrying an offensive weapon, even when they do not cause any harm, can face a term of imprisonment of up to 3 years, and yet a person who provides an explosive such as a bomb, knowing it will be used to commit a crime, can be imprisoned for only up to 2 years. That is the nub of it, and I will resume my seat.

The ASSISTANT SPEAKER (Hon Trevor Mallard): I call Stuart Nash. Sorry, we are having some problem with the clocks here. We will get there.

STUART NASH (Labour—Napier): Look, I actually felt for the member Alastair Scott—you know, when he stood there silent for 20 seconds—because I have got to speak for 10 minutes on this bill as well, and if I read this bill out very, very slowly, including the explanatory note, I think I would make it to 4 minutes and 22 seconds. So making a 10-minute speech out of a 4-minute bill is actually a real challenge, but it is one that I will take up with gusto.

The interesting thing is that the member before Mr Scott, Andrew Bayly, stood up, and he spoke passionately. He was really passionate. He talked about finance and expenditure, and he talked about closing tax loops, and he talked about foreign companies, and he was raging. He was on a roll, but unfortunately he was stopped. He was stopped. When he talked about all the great things and the meaningful things the Government is doing, he was stopped so we could debate the Crimes (Increased Penalty for Providing Explosive to Commit Crime) Amendment Bill.

As a member of Parliament I take my role very seriously, and I take seriously the fact that passing legislation in this House is one of the privileges that we actually get when we are members of Parliament. Debating legislation and giving it a full debate is very, very important, and I think that is what New Zealanders expect. But the thing is that we have a bill in front of us now that is five clauses long. Maybe it is important, because the last thing we want, to be honest, is, you know, cowboys riding horses down the main street and blowing up safes after stealing dynamite from the local goldmine.

Kris Faafoi: Is it a member’s bill, though?

STUART NASH: Well, Mr Faafoi has a very interesting point. There may well be a discrepancy in the Crimes Act if a person provides explosives for the purpose of committing a crime. The last thing we want as New Zealanders is for criminals to say: “Well, you know, I might as well just give this bloke explosives, because if I give him a gun, I could go down for 5 years, but if I give him a stick of dynamite I’m only going to go down for 2 years.”

I have not seen evidence, and that is why—I suspect this is going to go to a select committee I am on—I would be very keen to hear evidence from the police as to whether, in fact, the term of only 2 years for providing explosives for the purpose of committing a crime has been either a deterrent or an enabler in terms of the weapons people use to commit crimes. Maybe what we will find—and only the police will know, because I must admit we have not got a regulatory impact statement or anything like that—is that the police will say: “Hey, no, this is a real problem. We do have a real problem with this, and what we’ve seen is around about a thousand people a year providing explosives for the purpose of committing a crime. And what we want is—we need the ability to lock them up for 5 years, because 2 years isn’t enough.” If that comes across a select committee table—if the police provide that evidence to our committee that shows that the law is an ass, because people are not providing guns, they are providing explosives—then Mr Scott will have done us a favour.

But I suspect—and I have nothing to go on this, and we have just done a firearms inquiry and we have heard a lot of evidence from the police and a whole lot of different interest groups—that, in fact, there have not been many New Zealanders over the last 10 years who have actually provided explosives to commit crimes. And I also agree with Mr Scott on one point, though, which is that the sentence has got to fit the crime. But what happens in this House, as we are well aware, is there are a number of amendment bills. There are, you know, Crimes Act amendment bills. There are statute amendment bills. There are a whole lot of amendment bills—

Kris Faafoi: Statutes amendment bills.

STUART NASH: —yes, sorry; statutes amendment bills—and omnibus bills—that actually have a look at these sorts of things, and our officials are forever going through pieces of legislation because, of course, when one piece of legislation changes, then it affects another piece of legislation. If a new crime is introduced and the penalty is X, you know, we have to get things in whack—of that there is no doubt. But I am just saying that the time we are going to spend on this bill, I think, could have been better spent if, in fact, this was part of a Crimes Act amendment bill, because I suspect that next Crimes Act amendment bill—and this goes back to 1961. I do not know how many amendment bills there have been for the Crimes Act, but I suspect there are a whole lot. But what I think could have happened is in the next crimes amendment bill, there will be—let us figure—15 or 20 different amendments to penalties for different crimes, because what we are seeing with the advent of things like P, with new weapons, with Tasers, and with all this debate going on in the community is that people are looking at the different penalties for different crimes.

I mean, let me give you an example. One of the recommendations that we have made—and this has not been passed by the committee yet—is that in terms of firearms offences, we need to look at the penalties, and not only do we need to look at the penalties in a New Zealand context but we also need to look at the penalties in a global context. What are the Australians doing, for example? What happens in Canada? What happens in the UK—so different Commonwealth countries. But when it comes to this bill, when the only purpose of this bill is not to redefine explosives, it is not to look at a different type of weapon—because the irony is that we are not only amending a certain section of the Crimes Act, we are amending a subsection of that section in the Crimes Act. We are amending section 272 of the Crimes Act, but, in fact, section 272 talks about “explosive substance,” which, of course, is what we are dealing with here, but also a “dangerous engine, instrument, or thing with intent to use or enable another person” to commit such an offence. There are a whole lot of different things within the specific clause. So, really, if the crime does not match the time, there is a much better way to deal with this, which I think could have really optimised members’ time in the House.

You know, the cynic in me says that Mr Scott put this in the ballot. He was told by his whips to put this bill in the ballot. He knew it was not going to get drawn out, because there are, what, 120 bills in the ballot. When this was drawn out, I can imagine Mr Scott in his office going “Oh, my gosh! What am I going to talk about?”, and the reason I can imagine that is that when he was actually standing here charged with speaking about the bill, there was a 20-second gap. Twenty seconds is not long if you are holding your breath or you are doing something else—

Peeni Henare: Enough for an explosive.

STUART NASH: —yeah, ha, ha, exactly, Mr Henare—but when you are supposed to be giving a speech on your own bill, after about 3 minutes, it is a long time, because there is nothing much to say about this bill.

Of course we support it. Of course we are going to support it. I mean, I do not want someone who provides explosives for the purpose of committing a crime to get away scot-free or to go down for only 2 years. In fact, I wonder—and we will find this out at the select committee, and I think the member gets another turn to speak on this later on, does he not—whether this is actually being led by the judiciary. Maybe a member of the judiciary has approached Mr Scott—and he can enlighten us in his last speech—and said “Mr Scott, as my local MP, I have a real concern, because I’ve had a whole lot of people in front of my bench in my court who have been done for providing explosives, and I can put them away for only 2 years and it is just not right, because the potential harm of their actions if they had not got caught would have been significant.”, and maybe that is why we are here. Maybe this is a really important piece of legislation, and Mr Scott just forgot to elaborate when he was giving his speech.

But, again, I suspect that there has not been a well-meaning judge. I suspect there has not been a constituent delegation that has approached his office and said: “We have this issue.” In fact, I suspect that if Mr Scott actually spent some time in his electorate, he would find that there are a lot of issues that people in Waipukurau and in Masterton have that are more important than this.

In fact, I suspect that Mr Scott will not be putting out a press release after we conclude the reading of this bill, stating that his member’s bill on Crimes (Increased Penalty for Providing Explosive to Commit Crime) Amendment Bill has gone through. And I suspect that if he did, it probably would not make the front page of the “Masterton Star” or the Wairarapa Times-Age. It might, but I suspect it probably would not.

So, at the risk of sounding a little arrogant—and I do not mean to at all, because I think that is a most ugly trait—could I suggest to Mr Scott that perhaps in future he concentrates on things that are really important in an electorate.

Aupito William Sio: Like housing.

STUART NASH: Like housing, like jobs, like economic development, like growth—

The ASSISTANT SPEAKER (Hon Trevor Mallard): Order! The member will resume his seat.

MAUREEN PUGH (National): Mr Assistant Speaker, I do seek your indulgence while I attempt to make a comparison of the consequences of using explosives for the committing of a crime. This bill did remind me of a significant explosion event that happened quite some time ago, if you:

Remember, remember!

The fifth of November,

The Gunpowder treason and plot;

I know of no reason

Why the Gunpowder treason should ever be forgot!

So we do not forget this example of the use of explosives for the purpose of committing a crime. Even though it happened in 1605, 412 years ago, it is emblazoned in the night sky every year on 5 November. However, it may not be well-known that the ringleader in this crime, Mr Guy Fawkes, was one of 13 conspirators in the crime of using explosives to commit a crime—as is mentioned in the amendment bill before us tonight. But because poor old Mr Fawkes was the one who was foiled in his attempt, he was found by the King’s guard and imprisoned and was tortured for several days, until he confessed to the crime and dobbed in his comrades.

The ASSISTANT SPEAKER (Hon Trevor Mallard): OK, the member is now 30 percent of the way into her speech. I would like her to now start speaking to the bill.

MAUREEN PUGH: I was just about there, Mr Assistant Speaker.

The ASSISTANT SPEAKER (Hon Trevor Mallard): Well, I am very pleased. You showed no sign of it.

MAUREEN PUGH: Now, to relate to the consequences, the traditional penalty for traitors in the 17th century was to be hanged from the gallows, then hung, drawn, and quartered. However, Mr Fawkes did not do that, because he took things into his own hands and leapt off the gallows and broke his own neck. However, the consequences today fall well short of those, and all we are looking to do is increase the penalty for the use of explosives, from 2 years to 5 years.

Individuals who carry dangerous weapons can look forward to longer prison terms than they would if they were supplying explosives for the committing of a crime, and explosives can have much more dire consequences, such as the intention of destroying people or property. This is an anomaly that needs addressing, and, thanks to my colleague Alastair Scott, we can look forward to these harsher penalties. It makes absolutely perfectly good sense when the consequences of using explosives are so extreme, and they cause immeasurable harm to innocent bystanders and, of course, disastrous consequences and damage to property.

National has an impressive track record not just on toughening sentencing laws but also on putting the victims of crime at the forefront of our thinking, by investing in our Safer Communities package and putting more law enforcement on the ground—880 new police on the front line, with 245 more—

The ASSISTANT SPEAKER (Hon Trevor Mallard): When I stand up, the member sits down. That is one of the rules of the place. For members on both sides, when they have got on to things that sounded like research unit notes, in one case I terminated the call and in the other I asked the member to come back to the bill. I am going to do the same for the member now and ask her to speak to the bill.

MAUREEN PUGH: We are back to talking about the clauses in the bill. I would like to refer to clause 4, which sets out that the purpose of this bill is to increase the maximum penalty from 2 years’ to 5 years’ imprisonment for the use and supply of explosives for the commitment of a crime.

I commend my colleague Alastair Scott for his initiative in having this bill put into the ballot and for his good fortune in having the bill drawn from the ballot. So that is divine intervention in making sure that we address these issues that are of importance to our communities. I commend this bill to the House.

DAVID CLENDON (Green): In recent times we have seen some useful members’ bills from the National Government. They have had substance, they have identified gaps or flaws in legislation, and they have sought to put those right. Sadly, in the view of the Green Party, this is not one of those bills. Its great virtue is that it is succinct. It is a brief bill. If brevity be the soul of wit, if Polonius had it right, then the drafter of this bill is a man of remarkable acumen, is all I can say. I have not seen a bill before where the title exceeded the substance. The title of this bill runs to 11 words; the substantive change manages only six words and three numbers. That is a remarkable balance, in terms of the content of a bill.

The bill rests essentially on three assumptions. The first one is that the penalty for providing explosives to commit crime is not comparable to similar offences. That is not a view shared with any enthusiasm by justice ministry officials. The Minister of Justice was kind enough—it only took a month—to respond to an Official Information Act request for a document entitled Comments on a Member’s Bill; Crimes (Increased Penalty for Providing Explosive to Commit Crime) Amendment Bill. The opening line from a senior official in the ministry states: “Our original assessment of the bill is that the bill is not outside the range of comparable offences.” OK. The point has been made, quite rightly, that individuals carrying or possessing dangerous weapons, if that is the charge, are liable to longer sentences. But the official goes on to say that section 202 of the Crimes Act, which the member referenced, broadly defines offensive weapons to include explosives. So anybody carrying explosives could be subject to those higher penalties. Indeed, the police are fairly bright in this sort of stuff. They would almost certainly bring charges under the Arms Act, which do carry significantly higher penalties. So the opinion of the Ministry of Justice is that their primary assumption fails—that there is an issue of comparability. There is no such problem.

Secondly, one would expect to see, with a bill of this sort in front of the House, that there had been some upsurge in offending, that there are people all over the country busily providing explosives to commit crimes. Our friends at the Parliamentary Library provided a very useful table showing the number of convictions against section 272 and, specifically, convictions of people who were charged and found guilty of providing explosives to commit crime.

In the year 2015-2016, the most recent year for which we have numbers, the number was zero; there were none. There was a dramatic increase in the year 2014-2015. There was one conviction for that offence. We then had a rather dry spell. In the 5 years from 2009 to 2014 there were no convictions for this offence. There was a real peak in 2007-2008 and 2008-2009. In each of those years there was one conviction. What we are looking at is three convictions for this offence in the last decade. That, to me, is not a crime wave. I do not actually see that we have a serious problem with the criminal element thinking they can get away with this because, after all, it is only a 2-year penalty.

The third assumption made here is that longer sentences are a deterrent. We have known for at least the last 15 years that all of the research says that longer sentences are not a deterrent. The first substantive bit of work done, around 2000, 2001 by Canadian researchers, challenged that. In fact they started to indicate “Hang on. What’s going on here?”. More recent research, done right here in New Zealand, indicates that longer sentences almost invariably lead to higher recidivism rates. So the connection between longer sentences and the deterrent effect has been broken for a number of years.

The reason we put people in prison for a long time is to keep them off the streets. That is the only deterrent value, and actually it is disabling them from offending. There is no sense of deterrence in it. There is no evidence. In fact, the evidence is all to the contrary—that in fact putting people away for longer is not a helpful thing. This bill, in our view, addresses a problem that does not exist and offers a solution that will not work. So, sadly, we cannot support it.

KANWALJIT SINGH BAKSHI (National): First of all, I would like to congratulate the member on bringing this bill to the House. I know it is a great honour to have a bill drawn from the ballot. In 9 years I have had one bill drawn. Some members have good luck; they get a few bills drawn, consequently.

The main purpose of this bill, the Crimes (Increased Penalty for Providing Explosive to Commit Crime) Amendment Bill, is to increase the penalty from 2 years’ to 5 years’ imprisonment for providing explosives to commit an offence.

It is important, and we need to understand that we have to make sure members of our society feels safe in their homes and their communities. It is very important because if we do not feel safe in our homes or in our communities, it means that we are not safe anywhere. This Government has been having this agenda to increase the resources and increase the penalties for people convicted of committing crime. National has been building on this for the last 9 years, and this is a good gesture, on behalf of the Government, from the member who has brought this bill to the House.

This bill will ensure that nobody provides tools to commit crime. This bill will be a deterrent. The previous speaker was saying that convictions have been low, but I think it is important that we should have the appropriate provisions whereby a person who is convicted is given a proper conviction and penalty, so that he is not going to reoffend. That will really help us to reduce reoffending, because this Government has got a target of reducing reoffending by 25 percent.

We hope that the tougher sentences provided by the courts will help to make society secure. This bill is a part of that. National has removed the eligibility for parole for first repeat violent offenders who commit the worst crimes, with the three-strikes law. Mr Assistant Speaker, I am coming back to the bill, but I am just adding that what we have done in the past 9 years is relevant to the bill. It is part of the deterrent that we think will reduce reoffending. These are the things that we have to understand.

We have to think about a few things that are set out in this bill. The legislation is to commence “on the day after the date on which this Act receives the Royal assent.”, as clause 2 states. We hope that in the select committee there will be some interest from the public in making some submissions. The committee is excited to have this bill in front of it, to process it, and to report it back to the House as soon as possible. Once again, I acknowledge the member Alastair Scott for bringing this bill to the House. I support this bill.

RON MARK (Deputy Leader—NZ First): Far be it from me to traverse some of the terrain that has been debated and discussed in the House this evening, but I cannot go—on behalf of the people of the Wairarapa—without complimenting the member Alastair Scott for the hard work. I read in the newspaper that he sweated many long hours over this issue, which clearly has vexed him for quite some time! He had the courage to put his very lengthy bill into the ballot, in the hope that it might be drawn so that everyone in the Wairarapa could sleep easier knowing full well that the member for the Wairarapa, Alastair Scott, was on the job!

I know much has been made of his bill this evening, and it was treated somewhat lightly, but I do have to remind the House—if I could come to his assistance in some way—that the use of explosives in New Zealand is not new in commissioning crimes. Mr Scott brings to the attention of the House the 1984 bombing of the Wellington Trades Hall on 29 March, at 5.19 p.m., when caretaker Ernie Hall and his dog were blown up, and he was killed. One could argue that had this bill been around at the time and had the perpetrator of that bombing been caught, then a far tougher sentence might have been made available.

But when we in New Zealand First look at this bill and we consider the fact that Ernie Hall was killed—

Alastair Scott: Ernie Abbott.

The ASSISTANT SPEAKER (Hon Trevor Mallard): Ernie Abbott.

RON MARK: Sorry, Ernie Abbott—I wrote that down wrong. When Ernie Abbott was killed, the charge that the perpetuator of that bombing would have faced would have been murder, with the full weight of the law and the full range of sentences available.

I guess one of the things that concerns us is why, when Mr Scott put this bill together, he did not make the 5 years mandatory. He has left it open-ended by making the sentence one of not exceeding 5 years. One would have thought, and I know in the Wairarapa people are asking this, that if their MP, Alastair Scott, spent so many nights staying up late—until 3 a.m., I might have been told—drafting this bill, he would have thought, if it was so serious, that the minimum penalty would be 5 years, and not, as we currently have, a proposal to increase the sentence from 2 years to a period not exceeding 5 years. So we are probably going to address that issue in select committee and try to encourage Mr Scott to accept an amendment to his bill.

I guess Mr Scott might well have been thinking of the Rainbow Warrior, the bombing of that vessel and the death of a person there, but, once again, we are going to have to ask Mr Scott: “Well, did the other aspects of New Zealand law not take care of that crime in an appropriate manner?”.

We are trying to be as generous as we can to Mr Scott, because we know how much time he has put into this. And I know that he has put aside the issues of homelessness in the Wairarapa—he is not so worried about the 74-year-old who came to my office who cannot get accommodation anymore because the member’s National Government sold off all the State houses over there and there is nothing to rent. He is not worried about the fact that small businesses are screaming at him about the fact that this bill does not contain anything to alleviate the pains they are suffering from the earthquake legislation or the health and safety legislation.

We will try our best to get Mr Scott to look at a couple of things. I know that he still reflects on the Rainbow Warrior, I know that he still reflects on Ernie Abbott’s death, and I know that it pains him and worries him that people might use explosives to commission crimes. But we would hope that in the investigations—which will be very thorough and very expensive, let me assure the taxpayer, as the select committee progresses through this bill—he would look to make the penalty mandatory, and we would hope that he would examine the other penalties available for people who commit crimes of terrorism, which cause murder and which cause grievous bodily harm to innocent citizens. We would hope that he would pay the same attention that he has clearly got in the back of his mind, in that respect, to other such policies, and maybe come forward with an amendment to some of our Immigration Act policies, because it is there that some of us believe these risks most appropriately lie.

JONATHAN YOUNG (National—New Plymouth): I would have to say that this bill is about a very serious topic; that seems to have eluded some members of this House who have laughed at different aspects of it. Even the faux gravitas of the previous speaker, Ron Mark, is somewhat alarming. I say this because we actually live in a nation of relative safety, compared with other nations of the world.

I hold in my hand a report from the Parliamentary Office of Science & Technology from the Houses of Parliament in London. This paper speaks about explosive injury. None of us would laugh about this subject if we were in the House of Commons; we would be quite serious, I think. I think that we ought to have a degree of sobriety around this topic, because it is speaking about a form of injury of people. We are not talking about somebody sticking a bit of dynamite on to a safe and running away and blowing it up; we are talking about how explosives are used these days to create multiple severely injured casualties in a single incident. We are talking about the form of injury that explosives create and that we want to do something about that so that the supply of them is seen in a far more serious light than a maximum penalty of 2 years.

If I can, let me speak just briefly about a few aspects of this horrendous form of injury that would help us, I think, understand that this is something that the select committee ought to seriously consider. I probably do agree with the former speaker Ron Mark, who looked at this length of term of imprisonment of 5 years, and I think that, because of what these sorts of injuries can do, we need to look at something a little bit greater than that.

There are multiple forms of explosives, as we know. There is an initiator of an explosive, there is gas, and there is ejecta that happen. “The trigger excites the explosive main charge, and a chemical reaction converts the explosive into a hot, high-pressure gas, producing a shock or high pressure wave. The shock wave and the hot, high pressure gas released by the explosive propagates through its surrounding [casings].” This is quite interesting because modern technology—not ancient technology—is quite devastating. “Gas: expands [rapidly] under pressure typically in excess of 1 million times that of the Earth’s atmosphere, at 6,000°C.” So let us have some, I guess, consideration of those issues. “If trapped, the gas vents through gaps in the fractured container and soil at [approximately] 4 km per second,”.

So what I am saying is that these elements are devastating, and we ought to have, in regard to this bill, I think, some consideration around how we can see the sentencing around people who perpetrate knowingly, who are involved in the supply chain of such elements, who have no regard for the fact that it can create impartial injury. We ought to ask the select committee to look at this with great seriousness and look at whether those sentences are indeed adequate. Thank you, I am very happy to commend this bill to the House. Thank you very much to Alastair Scott for bringing it to the House.

Aupito WILLIAM SIO (Labour—Māngere): The previous speaker, Jonathan Young, said that we should not be treating this like a joke, and we are not. And I hate myself for laughing. I hate myself for laughing, but when Mr Bakshi got up and acknowledged his colleague for bringing this bill in, all I saw Mr Alastair Scott wanting to do was to hide. When Mr Kris Faafoi says that this is one bill that will not be publicised and there will be no publicity around this—

Stuart Nash: That was me.

Aupito WILLIAM SIO: —we could see—oh, maybe it was Mr Stuart Nash. We could see Mr Alastair Scott sort of hide. So I cannot help it, and I hate myself for laughing because it is a serious matter, but it is just the way that this bill has been brought about. Most people would stand up and be very proud of this occasion, and then I saw Mr Alastair Scott stand there in silence for 20 or 30 seconds.

I just happened to read about the Wanganui Computer Centre bombing, and this is serious because it was a young man in 1982, a 22-year-old, Neil Roberts, who was killed during the Wanganui Computer Centre bombing. He was antiracist, he was an anarchist in the peace movement, and what he did was he targeted the computer rather than the police personnel, but he has died as a result of the explosion. He left a graffiti message and the graffiti message says: “We have maintained a silence closely resembling stupidity.” I am not trying to belittle Mr Alastair Scott. It is just that sometimes we in the House, or in this case the Government—I see Mr Scott holding this flag, holding up this bill called the Crimes (Increased Penalty for Providing Explosive to Commit Crime) Amendment Bill whilst everything is burning around us in this House. Everything is burning, and here is Mr Scott holding up the flag on this particular bill.

This is the bill that I am holding up—on one piece of paper. That is the bill that this Parliament is now charged with debating and referring to select committee, and then it will come back to the House for the second reading and the final reading. I do not know how much it would cost for that particular process, but I would suspect—as Mr Ron Mark says, what about the other issues? What about the more meaty issues that our communities are facing?

If we look at clause 1, that is the title clause. Clause 2 is when the bill will commence. Clause 3 is referring to the principal Act, which is the Crimes Act 1961. Clause 4 sets out the purpose of the Act, which is increasing the penalty from 2 to 5 years, and clause 5 is section 272, which he is amending. There is nothing further. So I now understand why Mr Scott sort of stood there in silence and was not sure how to complete his 10-minute speech. He was stunned. I was stunned, you know, because this is his bill.

But I want to take on board what the Green Party said about increasing the penalty from 2 to 5 years. If we look to Florida, where they have this rule called 10/20 life rule—if you produce a firearm to commit a crime, it is 10 years. If you fire a firearm during a crime, it is 20 years. If you shoot somebody, irrespective of whether that person dies or not, it is life. We know how harsh those penalties are, and I suspect that that is what Mr Scott wanted to do with this bill, which is to make the penalty harsher. But has it reduced crime in those countries? No. So I am not quite sure what he is trying to do with this bill. It would have been better if he looked at reviewing the whole Crimes Act of 1961.

I also note that in the original bill it refers to providing explosives. So we are not talking about people blowing things up. We are talking about somebody walking down with a stick of dynamite, but where do they get those? It would be pretty hard to get, and, as the Green Party has pointed out, there have been three convictions in the last 10 years. Is it really appropriate for this Parliament to spend resources and time when we have got meatier matters? The original Act talks about “explosive substance”. There is no definition in the original Act, so we do not know what that means. The original Act talks about “dangerous engine”—

The ASSISTANT SPEAKER (Hon Trevor Mallard): Order! The member’s time has expired. I do want to compliment him for being both relevant and original.

IAN McKELVIE (National—Rangitīkei): I want to start by congratulating Alastair Scott on being lucky enough to draw a bill from the ballot. I have had a go at it—cannot draw one. A number of other members of the House have had a number of goes but cannot draw them, but he has drawn this one, and I think it is a very interesting bill. When you think about the history of parliaments around the world, explosives have played a large part in the dealings of parliaments. In fact, one of my very own constituents turned up here a year ago and tried to burn the place down. It is dangerous stuff. So I congratulate Mr Scott on drawing this bill from the ballot, and I concur with the last speaker, Aupito William Sio, that it has taken a lot of trees, a lot of paper, to get it to the House and to have some impact.

I want to pick up a couple of issues that have been raised by other speakers, particularly David Clendon. I want to take issue with his records, for a start, because I do not think his records are entirely correct. But I also want to take issue with the research he had done that told him that increasing the penalties for a crime that is committed only once every 2 or 3 years really is not worthwhile. I think from a police perspective a more serious penalty may well give the police more encouragement to prosecute, for example. I have a bill in the ballot myself on livestock rustling, and I am pretty sure that with more serious fines we would see much more reporting and much more serious note taken of those crimes, and perhaps we would get more prosecutions and, as a consequence of that, less crime.

I would also like to take issue with Mr Mark, for a moment, because he spent a lot of time talking about the great effort or the length of time that Alastair Scott had put into designing this bill. I am quite sure it did not taken quite as long as Mr Mark thought, as he is an intelligent man. I then want to take issue with Mr Mark’s, I guess, veering into areas that were clearly the responsibility of Mr Scott as the MP for Wairarapa. Mr Mark had no business dealing in some of the issues that he started to talk about during the course of that epistle that he gave us.

When I was young explosives were a great game, and we used to blow all sorts of things up, right from the test tubes in the laboratory at school to trees of all sorts, and explosives in those days were much more freely available than they are now.

The other issue I want to raise in respect of these issues—and it is a common issue for a lot of the electorate MPs in this area and I am sure for the member for Hutt South—is the issue of fireworks and the terror, I guess, that they create for animals. I think it is not so bad having 1 or 2 days a year when we can blow things up, but I think to have it broadly across the sphere is not so good.

So I think this bill is worth bringing to the House. It is part of the National Party’s and the National Government’s policy to strengthen law. And, as I said in the debate last night on another law and order bill, every little piece of titivating we do to legislation related to law and order is a great assistance to the police and to the law and order and enforcement authorities. You just never know when the critical initiative around legislation is going to make a great deal of difference to the way we treat things and the way we look at the harm done and the damage done by, in this instance, explosives; last night it was done by sexual offenders. And we are constantly dealing with these law and order issues in this House.

So I think Mr Scott has done a pretty good job bringing this extensive bill to the House, and it will, as I said earlier, complement the Government’s efforts to just tighten up the law and order area a little bit. I did wonder when I first saw this bill whether this was meant to penalise the person who blew the thing up or just the person who gave the explosive to the person to blow the thing up. I find it is really just to penalise more seriously the person who gives the explosives to the criminal who then blows the thing up, which I think is quite interesting. Hopefully, that person who does use the explosive will get seriously penalised for the crime.

So I will wind up my short contribution to this very interesting piece of legislation by saying that we will look forward to it—I assume it will come to the Law and Order Committee under the very confident chairmanship of my colleague in the next seat, Kanwaljit Singh Bakshi—and we will look forward to the debate that we will have during the course of it. I congratulate again Mr Scott and look forward to hearing his summing up. Thank you.

MARAMA DAVIDSON (Green): I always stand in this House and declare what an honour and a privilege it is to speak on legislation. In this case, it is a duty. The crimes amendment—

Hon Members: Ha, ha!

MARAMA DAVIDSON: Oh, catch up, everyone. The crimes amendment bill, which is the Crimes (Increased Penalty for Providing Explosive to Commit Crime) Amendment Bill—on this international day for women, I think about the accountabilities that I would have and the criticism that I would receive if I were to introduce a bill that I think is not a wise and fair use of the resources of the House, of our debating time, and of our analysis and resources. So I will make that very clear from the start.

We are opposing this bill for its substance, and I also want to make it clear that I think that there are far more important areas of justice that we need to be utilising our time for—particularly at a time where communities and constituencies are really struggling to find and connect and find relevance to what we here are doing in this House. This bill will increase the maximum penalty for the provision of explosives to commit an offence from 2 years to 5 years. As my colleague David Clendon said, there is no obvious concern at present about the growing use of explosives, and in 10 years there have been three convictions and the majority of those were farther away ago in time.

Recently, in the past 8 years, there has been one conviction. So there is no obvious concern—then, why? Why has this bill come to this place, particularly in the event that there is little evidence that criminals even respond to harsher sentences in the way that we would like them to? If there is some evidence that they do respond to harsher sentencing, then it is concentrated in the first few years, even, and that is the first 2 to 3 years that is already the current situation’s maximum penalty for this particular crime. This increasing maximum penalty comes at a time when in New Zealand our incarceration rates are disgraceful. We have reached 10,000 prisoners now. We are the seventh highest country in the OECD when it comes to churning out billions of dollars of resource to put people in prison, which does not have the effect of creating safer communities and certainly does not reduce reoffending.

Instead, if we did want to spend time on legislation and debate and working together across the House, it should be a move to things such as restorative justice. The National member Mr Jonathan Young spoke before about maintaining sobriety when we discuss the harsh and violent nature of explosive crime. The thing with restorative justice is that it puts victims at the centre of the process and seeks to really heal the harm. [Interruption] Thank you, Mr Assistant Speaker. It also has a focus on community involvement and it gets the offender to take true responsibility for what they have done.

Bringing this legislation to the House, in my opinion, was not just an unwise use of our resources but also does not attack the core of how to properly heal from the harms of the crimes that take place from explosives. Instead of the mismatch between supposed sentences in legislation, we should be looking at other mismatches in justice—for example, between sentencing Māori and non-Māori young people, where doing the same thing can bring a non-Māori and a Māori a completely different sentence. I will just end by saying again that we should be looking at what actually will bring reoffending rates down and create truly safer communities. Thank you.

ALASTAIR SCOTT (National—Wairarapa): In reply, I would like to say a couple of things. We are not talking about how Māori are treated differently in the justice system. We are not talking about earthquakes. We are talking about a very simple piece of legislation—in fact, a one-pager. It is a one-pager. All it does is allow the penalty to be increased for those who are interested in possessing explosives to blow someone up, obviously. So that is it. That is it. It is very, very simple, but it is very, very important, and I will tell you why. It sends a message. It sends a message to the community, and it sends a message through the judiciary, to say that this is a serious matter.

Mr Clendon is right. It might be that a person in possession of explosives could be caught under some other category of the Crimes Act. But this makes it explicit, and those categories do not have a maximum of 5 years’ imprisonment.

So, for those who say “Oh, it’s never happened.”, “It’s hardly happened.”, or “It’s not going to happen.”, well, let us just imagine if it did happen. Let us imagine that if the guy who was out on the pavement just recently with a carload of fuel for the purpose of blowing this place up—imagine if that had happened. He is up for only 2 years at the moment. He is up for only 2 years, but we have spent a lot of money around this place on putting in bollards to protect ourselves from numbskulls who have some idea that they want to blow people up.

You know, I cannot understand, Mr Clendon, your view that because there have been only half a dozen people arrested or charged or locked up—that is just not relevant. It is absolutely not relevant. That is like saying: “Oh, no one’s ever going to drive two planes into a tower and kill 5,000 people, because it has never happened before.” Well, Mr Clendon, get into the real world.

There are new technologies out there. There are real scary people out there who are interested in blowing this place up. Whether it be gangs out there, whether it be on just a political basis, whether it is protecting their P patch, whether it is protecting their tinny house, there are ways and means that people will take on, and they will use explosives to make their point or to defend their patch. For someone to be able to provide explosives for that purpose and walk away with only 2 years maximum is just a nonsense. It is just a nonsense, and it demonstrates again that you guys are soft on crime.

You may say that some sentences should be this way and that way and that we should not lock people up for ever, and all that sort of carry on, but let us get it right. Let us get it right with regard to a degree of the importance of the sentence.

Mr Mark had a point. Mr Mark had a very reasonable point. Maybe it should be 5 years minimum. Maybe it should be 5 years minimum. I am not going to agree or disagree with Mr Mark at this point, and that is why it is important that it goes to a select committee so that people can discuss and consult. Perhaps we will get Mr Clendon’s vote in the second reading, after he has actually understood the issue and the risks that are involved in having people carrying around explosives, letting them off with smart phones.

You know, this technology has moved on since Ernie Abbott’s explosion. Technology has enabled people to get away with a lot more things. But also, obviously, with surveillance and so on, it is a good thing as well. Nevertheless, there are people out there who are interested in harming others, and we need to send a clear message that carrying explosives and using explosives for the purpose of damaging property and humans is unacceptable and will be punished.

A party vote was called for on the question, That the Crimes (Increased Penalty for Providing Explosive to Commit Crime) Amendment Bill be now read a first time.

Ayes 105

New Zealand National 59; New Zealand Labour 31; New Zealand First 12; Māori Party 2; United Future 1.

Noes 15

Green Party 14; ACT New Zealand 1.

Bill read a first time.

Bill referred to the Law and Order Committee.

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

Bills

Domestic Violence—Victims’ Protection Bill

First Reading

JAN LOGIE (Green): I move, That the Domestic Violence—Victims’ Protection Bill be now read a first time. I nominate the Justice and Electoral Committee to consider the bill. My speech today is for every victim of domestic violence who ever felt trapped and for every person who knew a workmate was being abused but did not know how to help.

It is no secret that I used to work at Women’s Refuge, and the resilience and the strength of the women I worked with has always stayed with me. I remember one woman in particular who left with her children when the violence escalated. She had been living under siege for years but he said he would kill her if she left. It was incredibly brave of her to leave, and she was not sure it was the right thing to do. He had racked up debt in her name, and she was struggling to imagine how she would pay rent, childcare, and everything else as well as pay off that debt. She was also understandably scared that he would kill her or her children. She needed her job to pay off the debt and look after her kids. She was a sitting duck at work. I called her boss and explained the situation and tried to organise time off for her, a change of shift, or a different worksite for a while. They said no.

I remember that night driving her up to the door of her work, and she was lying down in the back of the van as I drove up to the door. Her fear was palpable, and I suspect mine was as well. She went back to him the next day, and I do not know how things worked out. This situation will be different in some workplaces today but not all. People ask: “Why do women go back?”. This is why—victims of domestic violence are in the most danger when they leave. I absolutely understood her decision to go back, and I still feel the frustration and powerlessness of not being able to help her.

Most victims, however, find it really hard to stay in work. The impact of the abuse has a profound impact, and often they struggle to concentrate at work. Their partners actively try to make them quit, or try to get them sacked by using all the petrol when they need to go to work or by disappearing instead of taking the kids to school etc., etc. Without a job victims become more isolated and dependent.

Domestic violence reaches into workplaces all over our country. Evidence shows that stalking, constant emails, phone calls, and attacks in or outside the workplace happen. Recent research, funded by Women’s Refuge, of New Zealand women who had been in a violent relationship showed that 60 percent were in full-time work before the relationship but that fewer than half of those women managed to stay in work through the relationship. At any one time in this country over half of New Zealand businesses could have a staff member experiencing domestic violence. Workmates are often the only people who know, but we cannot expect them to automatically know what to do.

This bill is about saving lives. It provides victims with a pathway to safety and protects them from the effects of abuse in the workplace by providing up 10 days’ leave every year, which can be used to cover time lost through injury or other impacts of the abuse. It can also be used for counselling, moving house, settling kids into a new school, dealing with the Family Court, or safety planning. It also clarifies that victims can request flexible working arrangements to minimise the impact of the abuse outside or in the workplace, that domestic violence is a workplace hazard, and that employers should create the environment to be able to identify and mitigate. Finally, it adds being a victim of domestic violence as grounds for non-discrimination to the Human Rights Act so victims cannot be sacked or otherwise penalised for the behaviour of their abuser.

International research has found that although CEOs think domestic violence is a major problem they underestimate its impact in their companies. I suspect the same is true here. The argument that these policies will cost businesses too much is amoral, and it assumes that domestic violence is not already costing businesses. Well, it is. It is costing them great staff and it is reducing productivity. Economist Suzanne Snively’s research shows that the provisions in this bill, if we get them right, will provide a net benefit to businesses in terms of increased productivity as well as, I hope, knowing that they are doing the right thing.

Last year former Prime Minister John Key said: “It’s easy to think this [family violence] is someone else’s problem. But it’s not [someone else’s problem] … if you are a New Zealander who cares,”. In this case I agree with him. This bill helps workplaces and employers show they care and make sure every victim of domestic violence gets the support they need. If someone is in danger and we can help, we should. That is the right thing to do. Everyone deserves a safe workplace where they can get the support they need to leave a violent relationship. Being protected at work and getting the help to leave should not come down to luck. We need a standard across all of our workplaces.

Last year, after hearing thousands of submissions, the Victorian Government’s Royal Commission into Family Violence found that having a supportive workplace provides financial security to victims at a major time of need and that work colleagues are among the most common source of support for victims. It recommended national employment standards and specific leave provisions—pretty much what this bill intends to do.

I bring this bill to the House in the context of social change. This bill did not just appear out of the brilliance of my own mind. Progress is being made internationally and here at home. I really want to acknowledge the New Zealand Public Service Association, who started championing and providing an evidence base for these policies way back in 2011, and all the other unions, including FIRST Union, E tū, the New Zealand Post Primary Teachers’ Association, and the New Zealand Nurses Organisation, that have been putting these policies on the table at bargaining for a long time now. It has been wonderful to see Countdown, The Warehouse, GCSB, GNS Science, ANZ, and many other smaller businesses and agencies responding and putting these provisions in place. The chambers of commerce and Business New Zealand publicly supporting this discussion, I think, is a milestone for this country. Of course, I want to acknowledge Shine and Women’s Refuge, who have been working with businesses for years to develop supportive policies as well as research to support this work.

The National Council of Women of New Zealand, Zonta International, and the New Zealand Federation of Business and Professional Women have all been championing this cause for a few years now too. Equal Employment Opportunities Commissioner, Dr Jackie Blue, has set up a business work network using her power to promote these policies. That is the context of this bill. All of these groups and people get that we are in this together, that domestic violence is something that we all have a stake in reducing.

For me, politics becomes inspiring when we work in partnership with communities to solve problems and create social change. For me, that is the Green way of doing politics. But I really want to acknowledge with gratitude and appreciation all of my parliamentary colleagues who are supporting this bill tonight. My faith in humankind has really taken a leap. I think it is a testament to the importance of the issue, but it is also a signal to survivors who are watching this that we care, and we should. Today we are starting a process that, if we get it right, will save lives and support victims, so that going back or quitting their job is never again the better option.

Today is International Women’s Day, and although this bill will apply equally to victims of domestic violence, regardless of gender, the majority of victims are women and children, so it seems a very appropriate day to be having this debate. I hope everyone listening will go away thinking that in Parliament we are prepared to listen, engage, and get this right. Let us be bold together.

Hon AMY ADAMS (Minister of Justice): I am very pleased to come and take a call on this bill tonight and on this issue, and can I begin by just acknowledging the member whose name the bill is in, Jan Logie, for her very genuine commitment to this issue. I know that it is one that the member feels—and has felt for a long time—very strongly about, and I want to acknowledge her not only for her work on the bill but for her work in the area and the work that she has done with me as we have discussed issues around domestic violence in the time that I have been the Minister of Justice.

Can I just reflect on one of the aspects of Ms Logie’s speech, which is to share in her joy when Parliament can recognise issues that are of importance to us all. In the time that I have been working on these issues—which is the entire time I have been the justice Minister—right across Parliament, actually, it is probably the one issue, more than any other, on which I have found that the party affiliations go by the by, and I want to just acknowledge not only Jan but all of my colleagues across Parliament for their work on the issue.

I have got to say that I have been utterly appalled, as I know other members of the House have been, at the sheer scale of this issue in New Zealand. I have said from the outset that I certainly do not claim to stand before any group and suggest that I have all the answers, but what became patently clear to me very early on was that, as a country, the first thing we have to do is ensure that right across New Zealand the conversation is had about the importance of the issue, the scale of the issue, the severity of the issue, the trauma it causes, and the intergenerational flow-through effects of those families that experience family violence. Let us be quite clear that whether or not the victims are getting physically assaulted and whether or not the violence is interpersonal violence between partners, everybody in that family, everybody in that whānau, is affected—particularly when it involves children. They suffer tremendous trauma.

This House, I am sure, will know that last year in New Zealand we had notifications to police of family violence upwards of 105,000 times over the year. That is about once every 5 minutes. And if that is not appalling enough—and it is—the police will tell us that, actually, on average, a woman victim, where it is a woman victim, will often have suffered episodes of violence up to 21 times before an initial reach out for help is made. When you think about those two facts, beyond anything else, 105,000 to 110,000 notifications a year represents the very smallest part of the scale of the problem.

I must say that I never thought I would be in this House long enough to hear a member of the Green Party quoting John Key with respect. Ka pai to you—I think that is a great step forward, Jan.

Jan Logie: Building bridges.

Hon AMY ADAMS: Building bridges. But you are absolutely right, and the former Prime Minister was equally absolutely right when he said that this is a problem for everyone—everyone.

I am not in any way shying away from the responsibility of Government to lead in this space, or the responsibility of this House, but, equally, we kid ourselves if we think that this Parliament or any Government can fix this on its own. If there was a bill that you could pass or if there was a programme you could fund that would put an end to it, no Government would have said no to that, and we all acknowledge that. That is not to say that we cannot do more, and that is why, with my colleagues—Anne Tolley, in particular, but colleagues across all the portfolios that impact on this space; 16 in total—we are overturning every rock and asking every question about what we can do better, because we have to do better. But it has to be more than the Government. It has to be a problem for New Zealand and every New Zealander.

The point I made when I made the commitment on behalf of the National Government to support the bill—certainly through the first reading and through to a select committee—was that what we do know, and what we must know, is that whatever the answer is, business has to be a part of it, and that is the absolute agreement I am in with the member. I think, actually, there is far more that the member and I share in common ground on this than we may differ on, which is not a bad starting point. But, none the less, it is incumbent on us to test carefully everything we do, because although the issue is significant and serious and real, as with anything in this space, we have to be very careful to ensure that we get our responses as right as we can.

But what we absolutely know—and what I agree with the member on, and what we have a chance to discuss—is that that does have to involve how we support these victims in their employment. I agree with the statistics that the member quoted around the impact on victims, and the additional trauma and difficulty and challenge, if they also lose contact with employment relationships. Equally, we know that someone going through particularly serious domestic violence when they are trying to get out of an abusive relationship, or trying to stay in one safely and successfully, will put needs and pressures and requirements on that victim and their support network that are unique to them, and, again, it is incumbent on us to think about how the system supports that. So although, in terms of the Government, we are not yet sure whether the answers in the bill as drafted are exactly the right mix, we are very happy to have an open conversation and explore that.

Can I also say and put on record my—“delight” is the wrong word in this context, but my great pride, I guess, in New Zealand, that so many parts of New Zealand, in the public and private sectors, have already taken steps down this road. You know, I have been an employer. I have run businesses. What you know when you run businesses is that your staff are your biggest asset, and, frankly, it is just good business and good economics to look after them. It is not about doing something because you have to do it; it is about investing in the people who pay you far more in dividend when they have a happy and productive and successful life. But I also know, as a mother of young children who has had to balance things, that when businesses are prepared to be flexible with you, it engenders a loyalty and a commitment and a productivity that I have always thought paid itself off in spades.

I do want to acknowledge with pride in my fellow countrymen the businesses that have seen this and that do work—and I know they are many and varied—to support their employees when they are in situations of domestic violence. I also want to acknowledge that across the Public Service we are seeing a tremendously strong response in this respect. We tested it with our 10 biggest Public Service agencies and 84—no, I think all of them, sorry. Those agencies, covering 84 percent of all public sector employees, all had arrangements in place to think about and work through how they would respond to an employee in this situation.

What I think will be very valuable through the select committee process is to hear more and learn more from those businesses that have put arrangements in place—what has worked, how they have found it works best, and what has not worked. The member, in her introduction, made reference to the five pieces of legislation that this bill amends, and each one of those will have its own impacts, which we need to carefully understand. I will admit to some nervousness around, for example, the width and the concept of the domestic violence document and how we frame that—how it works, how we set it up, and what impact that has on victims—and we do have to tread very carefully around how that is simply operationalised. So these are things that I think are worth exploring.

It is also worth reflecting, I think, that if those 110,000 incidents that I calculated last year would have qualified under the domestic violence document heads—and that would be a conservative estimate, because we know only what is formally reported—there is a huge continuum of circumstances in that. Parliament and laws are, by definition, blunt instruments. I think we have to be very careful to ensure that our response is not so blunt across that huge continuum of circumstances for New Zealand men, women, and children who are represented in those 110,000 incidents, but to ensure that we are able to arrange a framework that is proportionate, responsive, sensitive, and appropriate for that whole continuum. All incidents are serious, and we take none of them lightly, but there is a very different support system required, for example, when the police are called out to a very heated verbal argument, compared with, obviously, where a woman and her children are desperate to get out and to keep themselves safe. We have to ensure that our responses recognise those differences and reflect the needs of parties in each case.

So this is a discussion that we are interested in having because, as I said, how we think about and support domestic violence victims is a multifaceted approach. We have a huge programme of work under way looking at a number of aspects, but we are never so closed-minded that we are not prepared to consider other aspects.

What I will say, though, is fundamentally—and on International Women’s Day, I am going to be unashamedly gender-biased for one moment because, actually, in most of the serious cases, it is women who are the victims. Yes, men are victims, but more often than not, it is women who are victims, and if you want to know when the women of New Zealand will be safe, it will be when the men of New Zealand respect them and stop beating them. Fundamentally, we can keep women safe and we can do what we can to support the women, but if we want to stop this, we have to change the behaviour of the men who beat the loved ones in their life, and nothing will change until we change that.

Can I just end by, again, welcoming the discussion and welcoming the debate. We are going into it with an open mind and registering some genuine concern about the bill as drafted, but very happy to engage in the process.

POTO WILLIAMS (Labour—Christchurch East): I have to first acknowledge my dear colleague Jan Logie, who is an absolute champion for women, and I have to say, Minister Amy Adams—I am actually rather taken aback by the emotion you expressed at the end of that speech. I have to say for many women in the House, this is a very personal issue. I just want to tautoko my daughters and granddaughter in the gallery. Heaven forbid that anything that happens to many of the women in our country happen to those beautiful children up in the gallery. I must acknowledge Heather Hēnare, champion of this particular cause and supporter of many victims of domestic violence. Your work will go on and you will continue to be recognised for the amazing work that you do.

What this bill, I believe, attempts to do is to really start to normalise the conversations that we must be having in each and every workplace about domestic violence. It must bring it down to the point where we stop being scared of opening the door and shining the light on what is going on in many of the families that we occupy—that we live in. Each of our families is touched in some way by the abhorrence of domestic violence—whether we are impacted personally, whether our children experience it, or whether we are supporting our sisters and our brothers through difficult times. This legislation is saying: “You know what? It happens. Let’s own it. Let’s get real about this, everybody, because it happens, and because we are good employers, we are going to allow people the time that they need to address those issues.” Ten days is not much but, you know what, it is a heck of a lot more than we used to get, and it is a good start. This bill actually says: “Yep. We have a responsibility here. We have a responsibility as employers to support our employees through this, and you know why? Because they are good employees and we want to keep them and it actually adds to our bottom line at the end of the day.”

Let us get real—it is all about the cost-benefit for the employer. It is about the social benefit for that employer too, and I want to acknowledge all of those refuges, all of those family violence services, and all of those networks that have managed to stay together, despite some very difficult times, because that is where this work has come from. It has come from the grassroots family violence services, every single day, out there, not only supporting women, kids, and men but actually finding those creative solutions, those opportunities to actually make a difference, whether you have got funding or not, because this is New Zealand’s biggest issue. It is our biggest handbrake in terms of our productivity and in terms of our safety. In terms of being a great little country, this is our biggest handbrake.

I want to acknowledge the work that some of our people do at the very grassroots. I can remember a few years ago when I was part of the west Auckland family violence movement, not only in refuge but in network services, where there were a couple of women who went out knocking on the doors of all the businesses to say: “Hey, we think family violence is a bit of a problem in our community. As an employer, what do you think you can do in response?”. And do you know what? Many employers, including a large supermarket chain, said: “Well, we’ll take this one step at a time.” The first thing they did was they actually had the white ribbons on White Ribbon Day and they handed them out over the counter—step 1. Step 2: the next year they actually joined the White Ribbon march and they got engaged with some of the family violence services to learn a little bit about what was going on. That is how these things start—one step at a time—and then they get to the point where they are businesses that acknowledge that family violence occurs within their staff and they want to do something about it.

I am really pleased that the Health and Safety at Work Act is involved in this and that we will be looking to train people to recognise that family violence is a hazard in the workplace. I am so pleased that this has come to the House for us to discuss and debate, and I am so pleased that we are actually now able to throw open the doors and the cupboards and shine some light on what happens, because, yes, there are 100,000 family violence callouts to the police but the problem is three or four or five times greater than that—we all know that.

Just in my final few seconds—I wish I had more time—I just want to tautoko you, Jan. This is an amazing bill, and it is definitely worthy of all the time that we can devote to it in the House. I really want to thank you very much for bringing it to the House.

SARAH DOWIE (National—Invercargill): I too join in the line-up of people here today who are very pleased to be speaking in support of this bill, the Domestic Violence—Victims’ Protection Bill, in its first reading—to see it through to the select committee stage and to have some honest conversation about how we move forward in protecting the majority of women who are subject to domestic violence and those men, in the workplace. I am pleased that Ms Jan Logie has referred this bill to the Justice and Electoral Committee. I think that our committee is up for the challenge to have these discussions, and, as I said before, I am very pleased to be part of this movement right now, which has unanimous support in the House.

I do want to pay tribute to Jan Logie. Contrary to popular belief, MPs do speak to each other outside this House, and I can also report that I had a conversation with Jan Logie just before we came into the Chamber here tonight. I could see her genuine excitement that (a) her bill had been pulled from the ballot, and (b) that she would receive unanimous support to see this bill through to the select committee phase. Well done, Jan, for championing this issue, and well done for this achievement.

Also, well done to our Minister of Justice, the Hon Amy Adams, for leading the charge on this side of the House in respect of the issue of domestic violence. It is an absolutely insidious, abhorrent thing that occurs in our society—an issue that is intergenerational and ingrained in our community, and one that is completely and utterly unacceptable. The only way that we can start to get on top of this issue is to have these honest conversations, to be upfront, and to empower women. I think that is a really important thing to say: to empower women—and also men, but to empower women to come forward and talk about this issue and to feel safe enough to seek help to remove themselves from abusive relationships and put in place measures to make their lives and their children’s lives safe, so that they can go on to lead successful lives and do what they want to do, free of fear of harm.

As I said, I am really pleased to be speaking on this bill, and, as the chair of the Justice and Electoral Committee, I am very pleased that it is coming to us to have that conversation. We have been upfront with a few of our concerns about the drafting of the bill, and we will have those conversations at the select committee. We will hear from advisers, hear expert evidence on the changes that are mooted, and also, of course, call for submissions from the public on these issues.

To create a safe environment at work is of course important, but we need to make sure that there is a balance in the workplace. I actually happened to be on the Transport and Industrial Relations Committee at the time that this Government made changes to the Employment Relations Act, and there has been some concern voiced that there may be a risk that the way this bill is worded would actually limit the flexibility arrangements that employees may have when seeking flexible arrangements at work. That certainly does need to be debated, because, if there is an issue, we certainly want people who are experiencing harm to be able to go to their employer and ask for flexible work arrangements until they can put in place measures to keep themselves out of harm’s way and keep their children safe. That is one of the issues that we need to explore.

There are other issues around the other Acts that this bill would change, but let us have those honest conversations, let us talk about the issue, and let us get in place something that works for our people, to prevent and, basically, eradicate this awful crime. Thank you.

The ASSISTANT SPEAKER (Hon Trevor Mallard): Before I call Clayton Mitchell—I chose not to interrupt the member—I do want to remind people of the rules of how people address other people in the House, in involving their surnames. I feel a little bit like Judy Small—you know, “Don’t be too polite.”

CLAYTON MITCHELL (NZ First): It gives me great pleasure to stand on behalf of New Zealand First to, first of all, acknowledge you, Jan Logie, for bringing this bill to the House. With tongue in cheek and with serious sincerity, I think divine intervention has played a little part in this. Being International Women’s Day today says a lot, and the only time I have seen that happen again was with Sue Moroney’s bill, when it was to do with paid parental leave. It was just again that the stars aligned, so well done and great courage. It just goes to show that the passion that you have for resolving this comes through with your speech and you speak very, very eloquently of that.

I would also like to acknowledge the Minister for her words and her sincere thoughts, along with all other members who have spoken here today, and it gives me great pleasure as a male to stand up and speak to this. The fact is that New Zealand First wholly supports this. We certainly would encourage the conversation to continue in select committee. I think there are some potential drafting issues but that is not here nor there. We would like to hear from small and medium sized businesses to see what their take is with regard to the period of time, the 10 days, that has been allocated for people who are suffering at the hands of domestic violence.

Let me just go to a couple of statistics, because people back home may not be aware of how big this problem is. Currently in New Zealand the Government puts $1.4 billion a year into dealing with domestic violence and sexual violence in homes. It is a problem that is probably costing the taxpayers $8 billion and that is made up of a raft of things. A study that was done—New Zealand research—shows that for every 100 workers experiencing family violence and domestic violence 94 percent will take 1 extra sick day, 78 percent will be unable to concentrate at work, 60 percent will be late by more than half an hour at least five times a month, 60 percent will also be harassed at work via the phone, 50 percent will miss on average 3 days a month of work, and 44 percent—nearly half of them—will lose their jobs because of domestic violence. This is a huge problem for New Zealand.

I think in the 1990s when we saw a terrible depiction—well, a good depiction but a very horrific and brutal depiction—of family violence at its worst, Once Were Warriors, for many people it was categorised as just in a certain group, but it is not in a certain group; it is actually very, very broad reaching within our communities. It does affect women particularly, but it also affects men. I do particularly like that this bill does have a neutral gender bias. It is about domestic violence in its entirety and not specific to women, although we all understand that the larger sufferers of domestic violence are women and that needs to be addressed in the way we deal with it.

Certainly what we have been doing for many, many years is clearly not working. In the OECD, New Zealand is the worst for domestic violence and it does not seem to be getting any better—the statistics we have access to have shown that. We would like to see a new, fresh look at the problem and we know that workplaces are in many cases a sanctuary for people who go from their home, where it is unsafe and they feel very, very vulnerable, to a workplace where they can confide in workmates and work colleagues, their bosses. This bill allows them to actually deal with it in their own space and time, giving the person suffering at the hands of domestic violence the flexibility and security at the same time to deal with this problem absolutely upfront.

This is a situation that I would like to take a moment to acknowledge and “hero” the businesses in New Zealand and internationally—but specifically here in New Zealand—that have taken a forward-thinking approach in dealing with this problem and have already implemented this policy within their business. That is the ANZ bank here in New Zealand. The Warehouse has also got that. Countdown is also very, very aware of this problem and I believe in Australia it has actually got an app that you can push, which is a confidential alert to senior management with regard to dealing with it. We have got the University of Auckland, which has addressed this problem, and the bill has certainly been very well supported and certainly supported through to the select committee by Business New Zealand and the chamber of commerce in Auckland.

We hope that this progresses through. I see the absolute genuine passion that Jan has and congratulate her on bringing this bill to the House. We are very pleased that this has got 100 percent support throughout the House this evening. It does not often happen, but when it does it is for good reason, so congratulations.

JONO NAYLOR (National): There is no doubt that domestic violence is an absolute scourge on our society. There is absolutely no doubt in my mind that we need to do absolutely everything we can to, firstly, eliminate it to ensure that we do not have victims of domestic violence in New Zealand, but also that we as a society do everything that we can in the meantime to support victims of domestic violence.

I think it is all too easy at times for those of us who have been fortunate enough to grow up in households where we have not experienced that and maybe have just been untouched by it, and certainly we have things to be thankful for in that. But, despite the fact that it is so prevalent in New Zealand, there are a whole lot of people in New Zealand who really do not understand the full ramifications for victims of domestic violence. Yes, there are the physical scars, there are the emotional scars, but then often there are a whole lot of other practical things that have to be dealt with.

For example, if you need to shift house because you are the one who has to move out, you do not just do that in your spare time after work, necessarily. Those things take time. If you need to visit your children’s school to explain to the principal or to their teachers about what is going on, to be able to help them manage their way through it, you do not just do that in your spare time after work. If you need to even change schools or go to appointments or otherwise, there are the really wide ramifications of a whole lot of practical things that victims of domestic violence have to endure on top of the abuse itself. So it is important that we have within our employment structure the opportunity for those people to be able to have the flexibility to do some of those things.

In an ideal world, we would not be here this evening having this discussion, because in an ideal world there would not be any domestic violence; also in an ideal world, even if there was domestic violence, all employers would be understanding enough to be flexible enough to ensure that this would happen anyway and there are, as has been said this evening already, many good employers out there who are already doing that. But sadly we do not live in an ideal world, and so we do need to ensure that there are some systems and some mechanisms in place to ensure that our victims of domestic violence in New Zealand are getting every amount of support that they can get.

I have to say, when I initially saw and heard of this legislation, I could see how for a large employer this would be relatively easy to implement. I thought, actually, when I first heard the idea of 10 extra days off per year, of how that might be difficult for a small employer. And so there will be some things, I am sure, as this goes through the select committee stage, that may need a little bit of nuancing for us to be able to figure out how we can ensure that those people are supported, while at the same time ensuring that the employers, and particularly smaller employers who are struggling, are not unnecessarily affected by that. I think, ultimately, we will be in a position where through what we do in this House we send a very clear message to employers so that, actually, an employee perhaps never has to invoke this clause, because they will be able to have the kind of relationship with their employer where they can actually go and talk to them about what is going on, and their employer will respond; but there obviously needs to be a backup for them if they have an uncooperative employer.

I also just want to acknowledge the delegation of people whom I had come through my office door in Palmerston North a couple of weeks ago, the local representatives from the National Council of Women of New Zealand. They came to me and said: “Jono, we’d really, really like you to support this bill, at least to the first reading stage, to ensure that this very, very important conversation gets on the table in Parliament and is debated, so we can work through all those different sort of nuances”—as I referred to before—“to ensure that we get the very best legislation we can.” I am really happy to support this, at least at this stage, to ensure that we have that very positive discussion, because, as I said when I opened this speech, it is clearly incredibly important that we not only eliminate domestic violence from our communities but do everything we can to support the victims of it, and I commend this bill to the House.

SUE MORONEY (Labour): At the outset, can I first of all acknowledge that this is International Women’s Day. What better day to be debating this bill than International Women’s Day, which is a day when we all stand in solidarity with women right across the world in order to, yes, celebrate how far we have come, but also to pause and think about what we have yet to do. This bill clearly falls into the latter bracket. I want to congratulate the member Jan Logie on her foresight in bringing this bill forward. As we all know, with the luck of the draw of the ballot—I think this is the ballot goddess at work again today. It is the ballot goddess at work again to make sure that this got debated on International Women’s Day, because, sadly, this is an issue that does affect women, in more numbers than it does men. In fact, what we would wish is that it affected nobody.

I agree with the last speaker, Jono Naylor, in that all of us would want to not be dealing with this end of domestic violence. All of us would want to be putting our energy into preventing it from happening. That is the world we really want to live in: where there are respectful relationships and people can deal with the pressures in life and the stresses in life without battering the people closest to them—the people who should be able to rely on the love and support of family members, but instead are hurt and have violence meted out against them from the people whom they should have the most trust and warmth and understanding from. Sadly, that is not the world we live in, and I will not rest until we actually address the front end of this, and actually stop that domestic violence from happening in the first place. But it does happen, and so this bill is going to be something that will be a huge relief for those people, predominantly women, whom this happens to.

Imagine how distressing that situation is of having to deal with that hurt, having to deal with that destruction, having to deal with all of the things that happen in a family unit when that occurs, and then having to turn up to work, put on your smiley face, pretend it is not happening, and get on with life. Actually, that would be an excruciating thing, and so to have this provision in place, where people know that they are not required to be subhuman and pretend that things are not going on that are; where people know that their jobs are not at risk because they are a victim of domestic violence, and that they cannot be victimised all over again because they are having to deal with the fallout of that, and therefore their job is at risk, so they get victimised all over again; where people know that they can attend court hearings; where people know that they can find alternative accommodation—and, boy, I do not know whether in this day and age 10 days is quite enough for that, quite frankly.

I am dealing at the moment with a situation where a woman who has been a victim of domestic violence has lost her home as a result of that—actually because the violence damaged the house, and so she has been kicked out of the house. She is in so-called emergency housing, and has been for 4 months now—moving from motel room to motel room to motel room with her daughter for 4 months. Imagine being in that situation and keeping your job going and supporting your family while all of your belongings are in a car and you are moving from motel to motel. These are the very sad situations that exist for far too many New Zealanders today. That is the harm we have really got to address. We have got to stop those situations from happening.

But in the meantime I am very pleased to stand to support this measure today. Thank you, Jan Logie. Thank you for thinking of the most vulnerable in our society and the ability that everyone should have: the ability to be able to continue in their employment and to be able to do that with dignity and with respect. This will be a very practical measure that will help out some of the most vulnerable in our society—help them to keep their jobs so that they can actually build that future for their families that they all deserve and that we all want them to have. I really look forward to continuing this debate. I look forward to the bill’s speedy expedition through Parliament. I want to see this in place before the election, so that it is voted on all the way through and we can know where the Government stands at every step of the way along this journey.

CHRIS BISHOP (National): Can I firstly acknowledge the sponsor of the bill, Jan Logie. I was not privileged enough to see her first reading speech, but I understand it was quite a remarkable speech, and I want to pay tribute to you, Ms Logie, for your sterling work in bringing this bill to the House. As someone who has also had the luck of the ballot smile on me, I suppose, and had a bill pass its first reading unanimously, as it looks like this will, it is a great feeling, so please enjoy it.

One of my favourite songs is a song by Pearl Jam called “Rearviewmirror”. It is on their 1992 album, and it is about domestic violence. The title refers to the protagonist in the song driving away, and the lyrics talk about driving away and the time for emancipation. The lyrics talk about dealing with the effects of family violence. It is one of my favourite songs not only because it is a great rock and roll song but also because of the lyrics. It is a song, I think, that first made me think seriously as a young person about family violence or about domestic violence. I guess it is a tribute to the power of music to make people think about issues that are really important in society. Pearl Jam is a great feminist band, as I know members in the Greens will know, and it got me thinking about it as a teenager.

It is not an issue that has ever touched me in a real, literal way in society. I have been very fortunate that it is not something I have ever had to deal with, except, I suppose, in a remote way, and I am very privileged to have not had to experience that, but for too many people in New Zealand, and for too many people in the Hutt Valley, it is a very real thing. “Joy” is the wrong word, but one of the things I have been very privileged to have done since I became an MP just over 2 years ago is to go and spend time with our women’s refuge in the Hutt and to deliberately get out there into the community, to some of our marae and to some of those community organisations that are dealing with the front end and the hard edge of this issue. It has been an eye-opener, and that is one of the things I think you can do as an MP, actually. You get the privilege of learning and growing in the job, and that is something that I have deliberately tried to do.

One of the things—I suppose the biggest lesson—that I have taken away from those visits and those conversations is that the size of the problem is truly remarkable. You know, it is just almost unfathomable, the extent of violence—almost always by men against women—in our communities. As Minister Amy Adams said in her excellent speech, which I watched in my office, it is not just going to take the Government to do something about this problem; it is a whole-of-society issue that we need to address. The Government will do its bit and we will lead on this, and I hope, actually, that we will look back on the 2014 to 2017 Parliament and people will say that was the Parliament—the 51st Parliament—when the New Zealand Government and elected representatives got serious about family violence. I do not want to besmirch or cast aspersions on the efforts of other parliaments that have gone before, or indeed other Governments, because I do not think this is actually about party politics, but I hope people will look back and say that it was the 51st Parliament that put a marker in the sand and took serious action on family violence.

I think the package that the Government has outlined, which—again, I do not mean to be party political, but we are in Government, so that is what has happened. But the package that Minister Adams has put together, and I know it enjoys widespread support across the Parliament, will, I think, make a substantive difference. The work across greater penalties, the work across early intervention work, some of the work that is going on with the Integrated Safety Response pilot—other speakers have made reference to it.

Those are all very worthy things, and the aim of this bill is very worthy as well. I am a member of the Justice and Electoral Committee and I am looking forward to discussing it on the committee. I think it is a worthy bill, and I am looking forward to the discussion. Kia ora.

IAIN LEES-GALLOWAY (Labour—Palmerston North): I would like to start where others have started, by congratulating the member in charge of this bill, Jan Logie. She was very humble in her first reading speech, by recognising that the work—as is always the case with these things—started outside Parliament with Women’s Refuge, with unions bargaining for changes through collective bargaining, and with all the other groups that, I am sure, have worked closely with Jan Logie on formulating this bill. But the truth is it does actually take someone in this Parliament to put the bill into the ballot, and then, when it comes out of the ballot, to actually champion it, to have the negotiations and to work with colleagues around the House, especially the hard work to get to the point where it appears we will have unanimity when we come to the vote on this first reading. So I want to acknowledge that work by Jan Logie. We all like to be humble in this place, but we have a job to do, and when those opportunities come up—when that bill comes out of the ballot—it does take a lot of work to get to the position that this bill has got to. So congratulations to Jan on doing that.

I also want to acknowledge the Minister of Justice, Amy Adams, for her leadership, because—I will say this gently, and like the previous member, Chris Bishop, I do not want to be party political—the Government’s initial response was negative. The Government’s initial response was that this would cost too much, and Michael Woodhouse, as the Minister for Workplace Relations and Safety, stated that on the record. Clearly, some conversations have gone on within the National Government, aided, I am sure, by the lobbying from the member in charge of the bill, and it is pleasing to see that Amy Adams’ leadership has won through and the Government has decided that this is a worthy piece of legislation to at least take to a select committee, where we can have the conversation.

And there has been some conversation tonight about what the Government’s role is in this. I think the Government certainly does have a role, but at the very least our role as a Parliament is to lead the conversation and to show the way. By getting this bill to a select committee, where businesses will have the opportunity to come and speak with us about the challenges that it may present to them but also the opportunities, and I hope they will work with us on how we can make this work, because we have heard from some organisations that the cost may be unbearable for some businesses, particularly small businesses. I implore them, please, come and speak with us about how we can make this work. Do not simply come to the select committee and say: “This can’t work. We’re not supporting it.” Parliament is of a clear mind that we want to make this work, so I ask everybody who is planning to submit to the select committee to come and speak with us about how we can work together to make this work.

I would actually like to look at some of the provisions in the bill, because much has been made of the leave provisions—the additional 10 days’ leave that would be available to victims of domestic violence—but the bill does much more than that, particularly in the area of flexible work arrangements, which allow people who have been victims of domestic violence to have flexibility around their hours of work, their days of work, their place of work, their location of workplace, etc. Again, I think the member in charge has been a little bit conservative on this—and Sarah Dowie touched on this—and we actually might just need to loosen things up a little bit here to make this allowance for flexibility at work more permissive. I think those of us who are in the Opposition tend to be a little conservative so that we can try to get the Government’s support and get it on board. I took Sarah Dowie’s comment as quite a constructive one and a positive one that, actually, we might be able to get that part of the bill to exactly where Jan Logie would like it to be. So that is good.

Obviously, there are the changes to leave. The changes to health and safety at work—I think those are incredibly positive. To actually acknowledge domestic violence as a workplace hazard—that is a bold step forward. Again, it speaks volumes as to how important this issue is, and the type of leadership that Parliament can take.

So I do encourage people to see this bill in its totality. This is not just a bill about leave. This is a bill about how businesses and employees and the Government and Parliament can all work together to say that we do not accept domestic violence and we will take every step possible not just to mitigate it but to stamp it out. The last point I want to make, as others have made, is that it is important that men take leadership and take ownership and acknowledge that when men stop committing violence towards women, we will make a significant step forward.

MAUREEN PUGH (National): I too stand in support tonight of the Domestic Violence—Victims’ Protection Bill, in the name of Green Party MP Jan Logie, and I add my congratulations to Miss Logie on her initiative in writing this bill and also on her good fortune of having it pulled from the ballot. I did hear her speech tonight. It was an impassioned speech, and I congratulate you, Miss Logie, on your dedication to this cause.

I too believe there is a lovely quirk of fate that sees this House debating this Domestic Violence—Victims’ Protection Bill today, because we are celebrating International Women’s Day, and the theme for International Women’s Day 2017 is “Be Bold for Change”. It is a call on the masses or individuals to help forge a better working world—a more gender-inclusive world. So there is a lovely irony in what is happening here today. As we have also heard here tonight, this is an issue that we all agree needs to be tackled by everyone across this Parliament. We will enjoy, I am sure, united support to get this bill through this first reading today.

The purpose of this bill looks to introduce a new leave entitlement for the victims of domestic violence. It is an omnibus bill that seeks to amend five pieces of legislation: the Domestic Violence Act, the Employment Relations Act, the Health and Safety at Work Act, the Holidays Act, and the Human Rights Act. I do have to confess that I did not quite understand how the Health and Safety at Work Act actually could be introduced into this bill. But, on reading the background, I do appreciate the need to have it included.

From my own conversations with NGOs that work with victims of domestic violence, there is a clear need to support women at work who have fallen victim to domestic violence. For women who work in front-line roles where they must interact with the public, it is essential for them to have their privacy protected, especially if a woman bears the marks, the bruises, the impacts from a domestic violence episode. Also at work an abuser makes it very easy for a woman to be trapped, to be captured in her workplace, and to become yet a further target for abuse. The most effective way that an abuser does that is through violent or abusive phone calls or emails. But also it becomes a risk for others in the workplace, and therein lies the impact on employers in terms of making their workplace a safe workplace.

I also acknowledge the work, as others have done tonight, of the Hon Amy Adams, who has also been working on a substantial programme of work, looking at the ways we address family violence and the type of support that can be offered to victims of domestic violence. I too am looking forward, as a member of the Justice and Electoral Committee, to furthering the work on this bill, under the leadership of Sarah Dowie. I also look forward to speaking with the wider community on the details of this bill, and having those conversations through the submissions stage.

New Zealand has a shameful record of domestic violence and one of the things that I certainly look forward to is the day when women are empowered, to the point where we no longer call them victims. I have great pleasure in supporting this Domestic Violence—Victims’ Protection Bill in its first reading. Thank you.

JAN LOGIE (Green): It gives me hope to stand up tonight after having listened to all the speeches in the House. I could think of it as personally gratifying that this bill, with the community we have brought to the House, has this support. But mostly what I am feeling is the message that you are sending to survivors in the country—that we are, together, committed to making their lives better. We have heard their experiences and we are committed to making their lives better in every way that we can. I think that, for me, at least is a moment to mark in time.

I have heard really clear support for wanting to eradicate domestic violence and for us to use what tools we can as a country to do that and to support the victims and survivors in the meantime. I have also heard a very clear articulation from all members in the House that, yes, this is not just the business of Parliament or Government, but all of us have a role to play in that, and that part of being a good employer is caring for your staff, and this is one way to do that and it will pay off for businesses.

I have heard mention that there needs to be some work around the drafting of the bill, and I am really happy to acknowledge that. Part of the reality of it was that I actually had different legal opinions on the current status of the law in relation to flexible working hours, but particularly in relation to the Health and Safety in Employment Act and the extent to which it covered domestic violence. So what we have drafted is something—it is quite hard to get something right when you are not actually sure of the status of the existing law. So I really do see it as an offering for us to be able to work together to come up with the best solution. When we are all on the same page about the outcome, then that gives me hope that this process is going to get the result that we need, and—I will say it again—it is a result that could save lives, so it is absolutely worth hanging on to.

I did appreciate the comments that maybe we could loosen up a little bit. That is not something that people usually suggest to me, but the flexible working arrangements and the need for the domestic violence documents in the bill were based on some legislation from overseas—from the UK. But, yes, we do not want to make it more difficult. We want to clarify that the flexible working arrangements should be used and should be available, and that needs to be visible, I believe, to be able to have that intent realised, but we do not want to make it more difficult.

Somebody did mention the point about the fact that perhaps this would be too onerous for small businesses, and I thank the member Iain Lees-Galloway for asking businesses to come with solutions if that is of concern to them. But I am going to push quite hard on this, because the international research—in Australia, 1.6 million workers are already covered by these provisions, and although the provisions are there, most of them do not take them. It is very rare. They will take some—they take what they need—because it is not a mandatory 10 days. It is up to 10 days, and you use it when you need it. The experience overseas, as well as in businesses here, is that people do not exploit that. It is a relationship of trust, which is working. So I want to put people’s minds to rest on that point.

In the final few seconds—just for all those people who have been fighting for this for so long, and for those women who went back because they had no other choice or felt that they could not get out, I hope tonight gives you some courage. Kia ora.

Bill read a first time.

Bill referred to the Justice and Electoral Committee.

Bills

Housing Corporation (Affordable Housing Development) Amendment Bill

First Reading

KELVIN DAVIS (Labour—Te Tai Tokerau): I move, That the Housing Corporation (Affordable Housing Development) Amendment Bill be now read a first time. I nominate the Social Services Committee to consider the bill. The population of New Zealand is 4.2 million, and I can guarantee that just about every single one of those 4.2 million people knows that there is a housing crisis in New Zealand, except for 59 of them. There are 59 people in New Zealand who, I know, do not realise that there is a housing crisis in New Zealand. They all sit over there.

Pita Paraone: Where?

KELVIN DAVIS: Over there, on the other side of the House. Everyone else in New Zealand has seen the pictures on TV of people living in their cars. They have seen the pictures on TV of children trying to do their homework by the interior light of the vehicle. They have seen pictures of people living in tents on their relatives’ back lawns. They have heard the stories about marae having to open their doors to allow whole families to stay for a number of weeks because they have nowhere to live. All New Zealanders have seen those stories, except for those people sitting on the other side of the House.

When it comes to a plan to address housing, those people have employed what I call the ostrich strategy. They have put their heads in a hole in the sand and tried to pretend that things are not happening around them. The trouble is, when you have got your head in a hole in the sand, the part that everyone can see is the posterior sticking up at them. What we would call that in Māori is whakapohane. When you show your backside to the people, it is a sign of contempt, and, to me, that is what this National Government is doing to the 41,000 homeless people in New Zealand—it is just showing contempt for the situation and the predicament that those people find themselves in.

It is the Government of see no evil, hear no evil, and speak no evil. The Government members do not want to see the problem that is staring them in the face. They do not want to go out and see the people down on Lambton Quay living in doorways. They do not want to see the people living in tents on their relatives’ back lawns. They do not want to see the people down at the marae. They do not want to see any evil. They do not want to hear any evil—they do not want to hear what we are saying, that there is a crisis. Their modus operandi is deny, deny, deny. They do not want to speak any evil—they do not want to say the “c” word: crisis. They do not want to acknowledge that there is a housing crisis. If they see no evil, hear no evil, and speak no evil, then, in their minds, no evil exists. But let me tell you that a housing crisis does exist in New Zealand.

We know that we have a new Prime Minister, and we know that he is no leader; he is a follower. Here is his chance to actually follow a plan from the Labour Party. The architect of that plan is my learned colleague sitting to my right, Phil Twyford. It is a plan that will see 10,000 houses built every year, for 10 years.

All we have heard from the 59 people across the way—who see no evil, hear no evil, and speak no evil—is a mishmash, hodgepodge, patchwork of random thoughts and ideas that are going no way to addressing the issue of homelessness. Let us have a look at some of their stunts and stupidity. There is Bill English selling off State houses, taking $1.8 billion out of Housing New Zealand, blowing the budget, and putting homeless families in motels. There is Nick Smith announcing that he would build houses on land that turned out to be unsuitable for residential housing—I think there was a cemetery; I think there was a power station or a pump house or something—

Phil Twyford: Government House—the Governor-General’s residence.

KELVIN DAVIS: The Governor-General’s residence.

Hon Members: Ha, ha!

KELVIN DAVIS: You may think that I am joking, but that is the truth. John Key declared that there would be 65,000 social houses, but he had no plan and no money because all he wanted was a big number in his speech, which he was delivering to a group. Then, remember Paula Bennett’s flying squads—they flew out and they could not see the problem. They failed to find the record number of families sleeping rough; they obviously did not look hard enough. Then Bill English abolished the housing portfolio. Is there actually—[Interruption] I am getting there, Mr Assistant Speaker. Is there actually a Minister for housing?

What this bill does—it is really, really simple, and the people across the way should take note—is it “amends the Housing Corporation Act 1974 to increase the supply and affordability of housing and land by requiring the Minister of Housing to undertake an affordable house construction programme that will build 10,000 affordable houses per year.”

Now, here are the two clinchers—everyone should take note. The first part of the plan is that the Minister must prepare a plan—must prepare a plan to build 10,000 affordable houses. Here is the real clincher—and I think everyone should take out their pens and their notebooks. The second part of the plan is to implement the plan. Develop a plan—such as the one Phil Twyford has developed, called KiwiBuild—and build the houses. That is all it takes.

It is pretty simple. In clause 4 inserting new section 50T: “(1) The Minister of Housing must prepare a plan in consultation with the Corporation for the building of 10 000 affordable houses per year for first-home buyers. (2) Within 6 months of the completion of the plan required under subsection (1), the Minister must present a copy of the plan to the House of Representatives.”—so that we can all see what is in the plan, and then—“(3) The Minister of Housing must—(a) ensure that all targets set out in the plan are met; and (b) report to the House of Representatives annually on its progress.” It is pretty simple: if you want to build houses, you have got to have a plan. Like I say, all we have seen is a mishmash, a hodgepodge, and a patchwork of random ideas, and the situation has not improved.

The second part of this bill, new section 50U inserted by clause 4, is that “The Corporation will be responsible for managing the development of affordable housing under the plan …”. This is what the plan means: the Housing New Zealand Corporation must ensure that the houses that are built are, first of all, affordable, because people have to actually be able to afford to buy them. We are talking about homeless people here or people renting, who need to be able to afford to buy houses; we are not talking about people who have already got one or two or three houses and they want more in their portfolio. The houses that are to be built must be sold to first-home buyers—those young people, and maybe some not-so-young people now, who do not have a house. These houses are not to be used for speculation. It is pretty simple stuff. The Housing New Zealand Corporation must ensure that all the houses built must meet all legal standards required, and are warm, dry, and safe.

It is a pretty simple plan, and the members of this Government over there need to open their eyes, open their ears, and, when we have the vote, open their mouths and say “Aye”—that they will support this bill.

In the last quarter there were 2,500 houses built in Auckland—2,500—and people said: “Wow, that’s a lot of houses.” The sad reality is that in the last quarter in Auckland alone, 4,000 houses needed to be built, so there is a shortfall of 1,500 houses. Let us extrapolate that over 6 months: that is 3,000 houses that we are falling behind with. Over a year that is 6,000 houses that are not being built that need to be built. And that is in just Auckland alone—we are not talking about the rest of the country.

As I have said, there are 41,000 homeless people in New Zealand. The most common complaint of constituents who come to my offices—after they have had a moan about Child, Youth and Family, the other most common complaint is about the lack of housing. They want us to help them to get into homes. In fact, I saw a guy the other day in a backyard in west Auckland who is living in a tent on his relatives’ lawn. That is unacceptable in 21st century New Zealand—that we have people these days who will never ever be able to afford a home to call their own. Imagine how soul-destroying that must be, knowing that you are going to raise your kids for ever living in someone else’s house. That has got to stop. All it will take is for this Government to support this bill. I commend it to the House. Kia ora.

JOANNE HAYES (National): I stand to take a call on this bill, and, first of all, I just want to bring to the attention of the previous speaker, Kelvin Davis—

Mr DEPUTY SPEAKER: Order! Sorry to interrupt. I should have said: the question is that the motion be agreed to.

JOANNE HAYES: OK, first of all I just want to talk about the so-called Labour KiwiBuild plan. I am sure that the previous speaker omitted in his speech to mention an interview with his leader by a guy on The AM Show—who is that? Mr Duncan Garner. He asked Mr Little whether or not the Labour Party’s KiwiBuild policy—building 10,000 houses per year as the target—would actually occur. What did Mr Little say? He said no. He said they would never achieve 30,000 homes in the first 3 years. He said: “Maybe 20,000 homes.” He also said that in order to do that, they would have to bring in foreign workers—foreign workers—to do this. Considering that Labour is a party that goes around and looks at Chinese names of people who are buying homes in Auckland, it is a little bit rich—when the Labour member gets up and has a crack at this Government about our comprehensive housing plan that has got results on the ground, is it not?

It is whacking 10,000 houses per year around the ears—that is what our comprehensive housing plan is doing. So when we start looking at the great things to do with our comprehensive housing plan, 5 years ago in this country we were building 13,000 homes a year nationally. We are now building 30,000 homes a year nationally. That is more than what Labour is promising within its KiwiBuild programme. In Auckland alone we have gone from 4,000 a year to 10,000 homes. That is whacking—this is what I am saying about Labour’s KiwiBuild programme. National’s comprehensive housing plan is actually whacking your one around the ears left, right, and centre, and a poke in the front, Mr Deputy Speaker.

Mr DEPUTY SPEAKER: I don’t have one.

JOANNE HAYES: We are actually training people in New Zealand in the construction workforce. Our construction workforce is numbering over 40,000 people in training, and the Building and Construction Industry Training Organisation is actually bursting at the seams in making sure that it has got all of these apprentices working within the building and construction sector.

We just need to look at the rebuild of Christchurch. Let us have a look at that. Let us have a look at how difficult it was to start with to get the rebuilds and the new builds done there. We had to find building people. We had to find carpenters and builders. We had to find construction companies to come in and do that rebuild. What did we find? Yes, we needed to build the workforce. We did not target overseas workers. We came within New Zealand itself—those who live in New Zealand.

Sue Moroney: What? Which Christchurch are you talking about?

JOANNE HAYES: Yes, we had a few, but we did not rely on them solely, Ms Moroney. We have not relied on them solely.

Sue Moroney: You’re completely out of touch.

JOANNE HAYES: So therefore we are building our workforce within our country itself, Ms Moroney. We need to start to listen about what is actually happening under our comprehensive housing plan, Ms Moroney.

Sue Moroney: Have you ever been to Christchurch?

JOANNE HAYES: We are looking at the Resource Management Act (RMA) reforms, Ms Moroney. Let us have a look at the RMA reforms that we have been slogging away at in the Local Government and Environment Committee, because these reforms are going to improve and fast-forward the building consents in New Zealand. I know that there is lots of yelling from across the way, but if you just hush up a bit you will be able to learn quite a bit about our comprehensive housing plan.

Let us start talking about our KiwiSaver HomeStart. There are 20,000 people who have received HomeStart grants. That is more than $89 million that has been paid out in subsidies to first-home buyers, to couples who actually qualify for this grant. When we start to look at the KiwiSaver funds, for those buying their first home, we are looking at 31,400 in the year to March 2016. That is $486 million of savings put towards homes, people’s first homes.

I tell you, this comprehensive housing plan that we have on this side is working for the people of New Zealand. We are getting people into their first homes. That is what it is all about—that is what it is all about. Our residential building activity has increased 19 percent nationally and 27 percent particularly in Auckland, to 2016. This is an amazing comprehensive plan. You must admit that, must you not, because so many people are benefiting from it.

Not only is Housing New Zealand Corporation involved in this but there is also the local government as well. This bill states that the corporation will monitor and implement the plan that is developed. Of course, we are working in partnership with them, with local government, to make sure that affordable housing is going ahead in this country. There are 213 special housing areas that have been opened up under this Government—213. How many special housing projects were opened up when Labour was in Government? Oh, that is right, Labour did not have any because it did not see it as an urgency, and we did, and we have taken the bull by the horns.

We back up everything in this comprehensive housing plan. We have the numbers, we have the people, we have everything that you do not have in your KiwiBuild. You do not have it and you never will have it because your plan has got too many flaws in it. There are too many flaws. First of all—[Interruption] Asian—

Kris Faafoi: I’m enjoying it—keep going. Keep talking. I’m enjoying it.

Mr DEPUTY SPEAKER: Order! We only need the odd indication that you are having a good time, Mr Faafoi. We do not need it repeated 15 times, or we will wonder just what you are up to.

JOANNE HAYES: Thank you, Mr Deputy Speaker. Let us move on to insulation. Let us move on to Warm Up New Zealand. That has been a National Government policy. Let us warm up New Zealand. We are actually making sure that social houses receive subsidies to insulate the houses and we are looking at that also with landlords as well. These are the things we have promised over the 9 years that we have been in Government, and we will continue to keep this plan going.

All in all, when I start to look at all the great things that have happened in our comprehensive plan, I doubt that it would ever happen under a Labour housing plan, because it does not have a housing plan. There is nothing, is there? There is nothing, absolutely nothing. When you have got a housing person who really does not like people with Asian-sounding names, then you are pretty much done for, are you not? You are pretty much done for.

In closing my speech, I will never support this bill. I will not support it going to the Social Services Committee. It is a waste of time. It is a waste of parliamentary time to try to even put a bill forward that is actually going to hamper the fast growth of housing in this country. To be quite honest, it would be shameful should it go ahead, because it is just wasting Parliament’s time. It will slow down everything that we have currently done. We are speeding up, we are going forward, because that is what this side of the House does. We are a party of action. We plan. We do our action and we do it for the benefit of everybody in New Zealand—even for you guys over there and all your whānau. All right? So, without any hesitation, I do not support this bill. I will never support this bill. Kia ora.

PHIL TWYFORD (Labour—Te Atatū): I want to thank Kelvin Davis for bringing this bill to the House. If the National Government had a scrap of sense, it would grab Kelvin Davis’ bill with both hands and run with it, but it will not. I know it will not, just like it will not tax speculators; it will not cut back on immigration to ease the demand pressures in the Auckland housing market; and it will not shut down negative gearing tax breaks that last year allowed property investors to write off $650 million in losses. It will not genuinely reform the planning rules or the way that infrastructure is financed, even though people like Nick Smith and Bill English have been blaming the Resource Management Act for 10 years for expensive housing but have done nothing about it after 8 years in Government. It will not rewrite the rules for renting, even though more than 50 percent of New Zealanders now rent but have no virtually no security of tenure. It will not apply decent, modern minimum standards that would ensure that all rental properties are warm and dry, even though 50,000 kids go to hospital every year with preventable infectious and respiratory diseases that are caused by poverty, overcrowding, and cold, damp homes. It will not stop the State house sell-off and instead build more State houses, even though that Government is now spending millions of dollars every month housing thousands of homeless New Zealanders in motels.

It will not do all of those sensible things, and for that reason the National Government will not tonight vote for Kelvin Davis’ bill, which would implement Labour’s policy—our KiwiBuild policy—of building 100,000 affordable homes for first-home buyers. It will not even admit that there is a housing crisis when the census data tells us that there are 41,000 New Zealanders who are homeless and living in severe housing deprivation, and that our biggest city has the fourth-most unaffordable housing in the world. Apparently, according to the Prime Minister, Bill English, when 40 Wellingtonians line up on the side of the street just to look at a rental property, that is a problem of success.

This bill, Kelvin Davis’ bill, is based on the simple truth that when you have a housing shortage, you build more houses, and that is Labour’s policy: to build more houses. And it is a policy that successive Governments in this country followed over decades. They did things like the State Advances loan policy, the capitalisation of the family benefit, that members actually, I would bet on all sides of this House, benefited from—their families, their parents and their grandparents benefited from those policies that gave New Zealand the highest rate of homeownership in the Western World and housed generation after generation of Kiwi families, and that is what Labour’s KiwiBuild policy would do.

When we change the Government, we will build 100,000 affordable homes—high-quality but modest affordable homes for first-time buyers. That will ease the housing shortage that is partly responsible for driving house prices sky-high, and locking out a whole generation of young New Zealanders from the dream of affordable homeownership. Under this policy and under Kelvin Davis’ bill we will set up a $2-billion revolving loan fund that will be spent approximately 20 times over a 10-year period and will be fiscally neutral at the end of it. The taxpayer will come out even, but we will have added 100,000 affordable homes to the housing supply.

We are going to crank up the construction industry and run it at the top of the cycle for a decade. We are going to train thousands of young Kiwis in the construction trades. We are going to have an affordable housing authority that will cut through the red tape and provide master-planned communities with all the amenities that people need that will be full of high-quality, affordable KiwiBuild homes. The National Government used to be ambitious for New Zealand, but now it is tired. It has run out of steam. It has run out of ideas. It does not believe that it is the Government’s job to ensure that all New Zealanders have a decent roof over their heads. They are so woefully lacking in ambition, they do not even believe that a Government can build decent houses for New Zealanders to live in.

MATT DOOCEY (National—Waimakariri): I am rising in opposition to the Housing Corporation (Affordable Housing Development) Amendment Bill. Just in response to that last speaker, Mr Twyford, who wanted to give almost a scorecard approach to the Government’s wins versus the Opposition’s losses—all you would need to weigh up is the Warm Up New Zealand housing programme; look at the Residential Tenancies Amendment Bill last year, which introduced insulation standards for social housing; and look at Budget 2016, which actually increased the number of places available for social housing. So I think what we can do is look at the reality of the argument. When you look at this bill, it is solely premised on the belief that it takes the Government’s intervention—the State’s intervention—to construct houses. But when you actually look at the constraints on housing and affordable housing at the moment, it is to do with two key things, and that is what I will be touching on in my call tonight.

I first just want to tell a story, if I can, that will illuminate my call tonight. Many years ago in the late 1990s I travelled the Czech Republic. I was on the outskirts of Prague ordering my coffee and my lunch and I was struggling to speak the language, but luckily there was a lady next to me who spoke quite a bit of English. I started having a talk with her over lunch, and I naively said to her: “Well, it’s been quite a few years now since the velvet revolution and the velvet divorce. It must be great to live in a country now where you have such freedoms.” And she said to me: “Matt, well, yes, we have freedom now, but we must never forget every day we must focus on people who say they want to support us but actually just want to take power away from us.”

This bill underpins very much the Opposition’s approach, not so much about housing, but this is about centralising power—it is only the State that can intervene; it is not the hard-working builders. They are the ones who are the experts on the ground and they know how to get out there and build. This bill is pitched as a very benign: “If you don’t plan to fail; you fail to plan. You need to have a plan.” It has nothing to do with that; it is purely the Opposition’s ideology that it knows best and only it can deliver the houses to those vulnerable New Zealanders.

Look at that track record of my region. Look at the track record of my electorate in Waimakariri. What the Government did was intervene to free up that sector so they could go on and build affordable housing for the people. We lost 23,000 houses in the earthquakes. They have been rebuilt and what that was about was the Government intervening under the Land Use Recovery Plan and freeing up land. This is not an issue around construction of houses; it is an issue around land availability. Even if the Government intervenes, it would still need to free up the land, and that is what we did in Canterbury. Not only that, we incentivised and sent signals to the building sector about how it can deliver homes under the cap of $450,000 for affordable housing. When we had the KiwiSaver HomeStart roadshow not only was the one in Rangiora town hall packed with young families looking to see how they could buy their first house, but it was packed with building companies and builders wanting to learn how they could build houses under the cap so they could get KiwiSaver HomeStart loan applicants. That is the framework that the Government should be providing.

This is a false argument. When you look at it, what are the terms? Under this bill, it is pretty weak. It is pretty light. Where are the definitions of affordable, first-time buyer, and speculation? What is the difference between someone speculating versus someone who just needs to sell their house when life changes for them? And that is why I do not support this bill.

MARAMA DAVIDSON (Green): I am very proud to rise tonight in the House to support my colleague Kavin Delvis—

Kelvin Davis: Oh, kia ora, Marama.

MARAMA DAVIDSON: Kia ora, Kelvin Davis—sorry. The Housing Corporation (Affordable Housing Development) Amendment Bill proposes to build 10,000 affordable homes, which is, over 10 years, 100,000 affordable homes. We absolutely need more affordable homes. This country is facing a housing crisis the likes of which we have not seen, and the Government owes it to New Zealanders to admit that we have a housing crisis, to actually just say the words: “We have a housing crisis.”

Homelessness is driven by a lack of affordable housing. Again, that is what this bill is wanting to fix. Again, this Government will not commit to ending homelessness, because by denying that there is a housing crisis in the first place, that lets it off the hook for actually trying to sort it. At the moment the homelessness we are facing, again, is a detriment that we have never seen before—41,000. In 2006 homelessness was at a level of 1 in 120. Now it is 1 in 100 people who are homeless. So the cost of doing nothing, which is what has happened to our country under the leadership of the National Government, is incredibly expensive and morally and disgracefully wrong.

We saw how expensive it is, for example, with the emergency funding blowout, where this Government is putting people up in motels because there is not enough housing, State housing, social housing, or affordable housing to be able to have everybody in a home, so $2 million was set aside for the year earmarked for this particular emergency cause. But, instead, nearly $8 million was spent in only a few months—in only a few months—because this Government does not have a handle on the extent of this crisis and what is actually happening around our country.

Another example of how this Government is trying to undermine exactly what is happening can be seen with the major discrepancies in the number of social houses and how social housing places are even counted. We have the Ministry of Business, Innovation and Employment saying that there are just shy of 61,000 social housing places; except social housing Minister Amy Adams says that there are 66,000 social houses, so undermining the extent of the crisis as well as trying to make the fix-up look better than what is actually going on. Also, we have a waiting list of 6,000 people for a State home amidst a Government State house sell-off. We could go on all night about the failure of this Government to address housing and to ensure our people in our communities do have a warm, dry, and secure home to live in.

But it all goes to the Government’s denial of the crisis so that it does not have to fix it. Why does it not want to fix it? Because it is more important to protect speculation, which is the buying of houses as a business, than it is to actually uphold the core responsibility to ensure everyone has a good home.

Building more affordable homes in the thousands, in the numbers that we actually need, is absolutely the step that we need to be taking. The Government owes it to properly commit to having a plan to actually get us there. It was unfortunate to hear the member Joanne Hayes feeling quite outraged at this bill—she was quite outraged by the end of her speech. She drew some pretty long bows and compared this legislation with wasting time in the House. What is this House for if it is not to debate the housing crisis? She said: “This Government works for all New Zealanders. We have got everything sorted.” That is offensive to the realities of what is actually happening to our people in our communities today. I am quite appalled that she stood to say that. Thank you.

JONO NAYLOR (National): Firstly, tonight can I just start with where I agree with Kelvin Davis. The first, obviously, is that Te Tai Tokerau is a pretty awesome part of New Zealand, and I am certainly happy to agree with him on that. I am also happy to agree with him that it is important for parts of New Zealand to have more houses built. I do not think there is any denying that. We would all agree that there are parts of New Zealand that do need more houses to be built. We are seeing house prices going up in particular areas in New Zealand at quite a large rate, in large part due to a lack of supply of housing and the inability to get those houses built. We have seen a couple of circumstances where this has occurred in New Zealand in past years; the first one was in Christchurch.

If we look at the reason for that in Christchurch, obviously there were a couple of very devastating earthquakes, which meant that there was an absolute housing shortage at the time. So the Government responded in an appropriate way to actually work through ensuring that we could speed up some processes to get houses built quickly and ensure that land was freed up. We have seen bills come through this House to do with the Riccarton Racecourse and others to free up land so it would be available for the private sector to be able to meet the growing demand for housing in Christchurch. What has happened as a result of that is that now we have seen a stabilisation of housing prices in Christchurch—because the Government responded in a way to allow the private sector to address some of those issues.

In Auckland we have had similar issues with a constriction of the amount of land available. It is not rocket science to know that when you have planning processes that put an urban limit around an area so you cannot spread out further but you cannot actually then subdivide smaller and increase the density of housing, there is only one way that prices will go—because you have choked supply. Demand continues to increase and, of course, the prices go up.

This Government has responded to that. The Auckland Council—and credit to the Auckland Council—has responded to that. It has made appropriate changes to its unitary plan, which is now allowing for a widening of that urban limit and also for greater intensification of housing, and that is freeing up some land. We have obviously been putting through special housing areas, over 200 of those, and we have seen that an estimated 70,000 new homes are to be built in those areas. We are on track. We have got some things in train, and we are addressing the issues that will allow us to be able to increase the supply and, therefore, address some of the housing issues in a place like Auckland.

This evening, earlier, we had another member’s bill before us. It was the Crimes (Increased Penalty for Providing Explosive to Commit Crime) Amendment Bill. On the other side of the House I heard a number of speakers decrying the length of the bill. They said: “Oh, this is a short little bill. It can’t mean much. If it is just a short little bill it really isn’t going to achieve much at all.” This is how big this one is. It is about the same size. What it smacks of when you have a bill like this is it simply works off this principle: if we say it, it will be so. If we say it often enough that we will build 100,000 houses, then magically 100,000 houses will appear. That is what this bill does—it says we are going to magically make 10,000 houses per year appear in the places where they are needed most.

You cannot magically make houses happen. Actually, I have heard criticism that things are not moving fast enough, that you cannot live in consents, and all these little pat lines that come out from across the House. Guess what? Even if the Government was to build those houses, the Government would still be subject to the Resource Management Act. The Government would still be subject to the planning processes and everything that it takes to get houses done.

This Government is not sitting idly by. This Government is not just leaving it entirely up to the market. We have seen the KiwiSaver HomeStart package, which has seen greater numbers of young people able to access it so they can buy their new home. We have put up $1 billion worth of infrastructure funding to ensure that those growth areas will get the infrastructure that they need. It is not simply just a case of saying: “If we say it will be built, it will be built.” No; what needs to happen is the appropriate measures need to be put into place to ensure the market is able to respond. That is what this Government is doing, that is why we are seeing so many more houses built, and that is why we do not need this bill. Thank you.

DENIS O’ROURKE (NZ First): I think we need to consider this bill with reference to the background facts, because one thing is for sure, and that is that this Government has been trying to hide the size of the housing crisis in New Zealand for several years, it continues to do so, and it actually denies that there is a housing crisis at all. However, Treasury reported just recently that the housing shortage in New Zealand, as a whole, is 60,000 houses, approximately, right now—60,000 houses right now, today—and it is growing by 40 houses per day. That is the size of the deficit. That is the magnitude of the crisis. But the Government’s response has been to deny the figures, as it always does, and it continues to deny that there is a housing crisis at all.

Last September the International Monetary Fund—another independent source—put New Zealand top of the class for housing unaffordability in relation to how much we earn, compared with 30 other developed countries. We also topped a list of 64 countries for house-price growth in the past year. So what is the Government’s answer to that? To fiddle with the figures, as it always does, and to try to fiddle with the Resource Management Act, which will actually make little or no difference to the supply problem for housing in New Zealand, despite the claims made by Nick Smith and others on the other side of the House.

In fact, this crisis is one that the Government actually created. It created it through poor policy and a failure to intervene effectively, and it has been in power for coming on to 9 years. That poor policy-making and that ineffectiveness has been at the root of the housing crisis, and yet those members want people to elect them again. Well, people would be crazy to do so, because this problem is only going to worsen, and one of the drivers for that, despite claims to the contrary from those across the other side of the House, is that immigration continues to run at a net gain of 71,000 a year. We in New Zealand First think that is at least 10 times too high. It is putting massive pressure on prices of houses, on rents, on infrastructure, and on services like health, education, and social services. In the last 5 years alone, Auckland has swelled by 188,000 migrants. Where on earth will they live if there is not a genuinely comprehensive housing plan to house them? House prices in Auckland have jumped a staggering 29 percent in the last 2 years because of this Government’s poor policy-making and ineffectiveness.

The Government has scrambled to try to look as though it is doing something. It wants to appear to be solving the housing crisis, even though it denies that there is one. The truth is that most people on that side of the House and their supporters do not really want to solve the housing crisis, because they feel that they get an advantage from it. They do not care about others who cannot afford to buy a home in New Zealand, and those are the ones whom New Zealand First does care about.

These facts are the background facts for why this bill is so needed. We need 140,000 houses over the next 7 years, and that means we need 20,000 houses per year, not the 10,000 in this bill. That is the truth of the matter for the whole country. Auckland alone needs more than that, so it is really not a very adequate bill as far as that is concerned.

Mr Doocey said that the Government policy solved the problem of unaffordability in Christchurch and Waimakariri. No, it did not. Many, many thousands of people there cannot buy their first home, as is the case in many other parts of the country. We do need a system that allows people to buy houses on equal terms, as well as making sure that the number of houses is available. New Zealand First has policies to do that by providing sections and built houses to be sold to them over 25 years on easy terms. That is what affordability means, and that answers Mr Doocey’s question on that.

Dr PARMJEET PARMAR (National): To start, I want to acknowledge the member in charge of this bill, Kelvin Davis. The Housing Corporation (Affordable Housing Development) Amendment Bill, as we know, is inspired by the Labour Party’s KiwiBuild policy. We know that under the KiwiBuild policy, Labour would allocate $2 billion to build 100,000 houses over a period of 10 years. In this bill, the member is proposing to build that exact number of houses—10,000 houses per year—improving the supply of houses to make houses affordable, and improving the supply of land. But if you look at Labour’s policy that is allocating $2 billion to build 100,000 houses over a period of 10 years, and if you do the maths properly, with $2 billion we can build not 10,000, not 100,000, but only 4,000 houses. That means you have to recycle your funds. Recycle, recycle, recycle—not five times, not 10 times, not 20 times, but 25 times. Is that practical? No, that is not practical.

As this bill is based on this flawed policy of the Labour Party, I am taking this call to oppose this bill. I can understand the intention behind this bill. On this side of the House, we value homeownership highly as well, and that is why we are continuing our focus on improving the supply of houses. To make houses affordable, yes, we need to have a strong supply of houses, but it is also about quality and it is also about choice. I visited a special housing area development in Three Kings, which is in Mount Roskill. What I saw there was this really nice building coming up with lots of houses in there. There was a real community feeling. There was a lot of choice. We do not want to see house after house that look like clones of each other. We want to give first-home buyers the choice. There should be choice, there should be quality, and they should, of course, be affordable. We know that it is about improving the supply of houses, and that is why we have a wide programme under way, which includes freeing up Crown land, which, as I have already mentioned, has special housing areas. We are also constraining building material costs, and then we have the KiwiSaver HomeStart package, which helps people get into their first home. That will help 90,000 people get into their first home.

The other thing is the Resource Management Act reform that is coming before the House. If the member is really serious about making houses affordable, I urge the member to go and talk to his caucus colleagues to support the Resource Management Act reform, because that will definitely reduce complexities and cost. That will definitely improve affordability of houses. If the member is serious about it, I urge the member to talk to his caucus colleagues to come and support Resource Management Act reform.

Yes, there is a $1 billion infrastructure fund. We know that housing development needs to be supported by infrastructure. I was in Hamilton a few days ago. The mayor there was really looking forward to the process. We know the applications are closing at the end of this month. I would like to see the same thing happening in Auckland as well.

Supply of houses is one side. There is another thing that we need to do to help people get into their first homes. That is, people need to have a reliable source of income, because they have to pay their instalments, their mortgage. For that, they need jobs. Under the National Government, in the past 3 years we have created 250,000 new jobs. The forecast is that there will be 150,000 new jobs by 2021. The other thing is that if you have employment now and then, casual or temporary, that does not help. You need to have a consistent source of income to pay your instalments. If you look at people who are in paid employment, 90 percent of them are in long-term permanent employment under this National Government. This is a very important aspect because this gives the confidence to people to go out and commit, because buying a house is not a simple thing. It can be a 15-year or 20-year kind of commitment.

As I said, this bill has good intentions but it will not deliver what it intends to. This National Government is already running a very comprehensive housing plan, and we are already starting to see results from our comprehensive housing plan, so I do not support this bill.

JAMES SHAW (Co-Leader—Green): I rise to support the Housing Corporation (Affordable Housing Development) Amendment Bill, in the name of Kelvin Davis, and am pleased to do so. This morning’s New Zealand Herald carried yet another story—yet another story—of a house in Auckland that had been flipped on for a ridiculous price. It sold for $819,000—itself a fairly eye-watering price for a lot of families—and it was resold for $900,000 the same day. It sold for $819,000 in the morning and $900,000 in the afternoon, making an $81,000 profit over lunch. It is pretty impressive. It is a pretty impressive way to make a living. I think most people in this country should be houses. If you were a house, you would make a lot more money than you would earn in a job, and, of course, we also know that you do not have to pay much tax if you are a house; you only have to pay tax if you work for a living.

The thing about houses in New Zealand is that they are no longer homes to live in; they are financial instruments that are being traded by an investor class who enjoy a privileged tax status that does not apply to any other asset class in this country, nor does it apply to people who have to work for a living. But the thing about this average Papakura house—built in the 1960s, made out of brick; a fairly average house, which sold for $819,000 in the morning and $900,000 in the afternoon—is that it should not have even cost $819,000 in the morning. Right? It is a pretty average house. The median income in this country is just shy of $50,000, so this house—this fairly average suburban house—was 16 times the median income of the average person. That is an extraordinary statement of failure in terms of the New Zealand housing market.

House prices in New Zealand, on average, are roughly 10 times the average income. By one measure, New Zealand is now the fourth-most unaffordable country for accommodation in the entire world. We have a very low population density, but we have this extraordinary unaffordability. By another measure—and I think it was the International Monetary Fund measure that was mentioned earlier—we are the most unaffordable. By one measure, we are the fourth-most unaffordable, and, by another measure, the most unaffordable country in the world when it comes to housing.

The thing that I like about this bill, actually, is its simplicity. The Government keeps saying that it has a comprehensive housing plan. It says it over and over and over and over and over and over and over and over and over and over and over and over and over, and yet we have this extraordinary market failure after 9 years of this Government.

One of the things I like about this bill is that what it says is that the Government should have a plan. Well, if it has a plan, it has got nothing to fear from this bill; it could just submit the plan that it has got. The problem is that this bill also calls for actually building houses, not just having a plan. In that, I can see why the Government does not support the bill. It might have a plan, but it is not actually building any houses, and so I can see why it is not all that keen on this particular bill.

But the simplicity of this bill—the idea that, when it comes to one of the most important responsibilities of Government, it is to ensure that our people actually have accommodation and housing and a roof over their heads—is, I think, its great strength. It says that in Government one of our primary responsibilities is to ensure that our people are not living in cars and garages, that they have adequate accommodation, and that, therefore, in a very simple way, we should instruct the housing Minister to come up with a plan and start building some houses.

It is absurd that we have gotten into this situation in the first place. It is because this Government does not have an interest in actually building houses. It actually has an interest in maintaining this speculative economy, because that is good for its voter base—the same people who benefited from the superannuation adjustment announcement the other day. It wants to appear to look like it is solving the problem, which is why it makes announcement after grand announcement, but its actual results are nothing—lots of heat and light and noise, signifying nothing.

This Government, when it comes to housing, is, as they say in Texas, “all hat and no cattle”. This bill would ensure that it actually went out and built some houses. I am pleased to be able to support it.

STUART SMITH (National—Kaikōura): This bill, the Housing Corporation (Affordable Housing Development) Amendment Bill—I mean, it is a laudable name. No one could really complain about the aims of the bill and the name of the bill, and, as the previous speaker, James Shaw, said, it is a simple bill, and he argues that its simplicity is its greatest strength.

When you look into the bill, it says it will ensure that homes that are built are affordable, but there is no definition of what affordable means. Minor detail, you might think, but it has no practical sense, other than a laudable aim. That simply will not work. It is a shame. The bill goes on further to say that the homes must not be used for speculation. Quite what speculation is—as my colleague Matt Doocey said before, people’s life circumstances can change, so is it going to require people to hold a house for a set period of time, during which they cannot sell it? When their circumstances change, how does that work? I can see another Government department coming out to make all the measurements on that, so perhaps there is some method in Labour’s madness on that one; I am not sure. I am not having a real crack at the member, because I think he has had a good go on this, but he has not really gone into a lot of detail. That is really where the whole thing falls down.

We have looked at the things that are causing the issues—talking about the cost of housing, which is referenced a lot by people in here. It is not the cost of building the house that has caused houses to go up in price in Auckland—and they are significantly in Auckland; it is happening a little bit elsewhere, but it is mostly in Auckland—it is a shortage of supply. I think Jono Naylor actually gave a pretty good explanation of the guiding principle of economics, which is supply and demand. And I think that, really, we have got a shortage of supply, which has driven up demand, and that has driven up price along with that.

But costs have gone up due to building costs as well, and a lot of that, and the shortage of land, comes back to the Resource Management Act (RMA). The Productivity Commission estimated that the RMA had added $15,000 to a house cost on average and extra costs added $30,000 on average to an apartment, and that over the last 10 years $30 billion had been added to the building costs for homes in New Zealand. Over that same period 40,000 fewer homes have been built—40,000 homes. If they were available in the market today, or had been produced through that period, we would not have the shortage that we do today. So you would think all those who are speaking in favour of this bill would be queueing up to help pass our RMA legislation; but anyone who thought that would be sadly mistaken, because they are not, and yet that is very clearly one of the key drivers of the shortage, which has driven the prices up, causing all of the issues, really, that this bill aims to solve.

In the meantime, another issue that is going on for us is the construction boom. It topped $19 billion last year in the construction industry, and there has been a huge number of houses built—30,000 homes in New Zealand, 10,000 of which were built in Auckland. Of course, that is constraining the supply of workforce to build those houses—and there is also a commercial construction boom, as well—but there has been a huge growth in jobs. There are 240,000 people working in the construction industry, and there are 10,000 apprentices being trained, so it is a huge opportunity to get more people into the workforce, build better homes—we do need better homes, and more homes. We have seen what has happened in Christchurch when supply really builds up momentum, where the terraced houses in Christchurch that were built for the so-called affordable end of the market are having difficulty selling now because of the supply and demand. The suppliers of demand are immutable, as is well known in the economic sector, and that has certainly shown up with what is happening in Christchurch.

To sum up, I think this is a bill with great aims, but it is fatally flawed because of its lack of definitions, and it really skirts around the main issue, which is supply and demand driven by poor RMA legislation. I urge other supporters of the bill to support the RMA legislation. Thank you.

Mr DEPUTY SPEAKER: Kelvin Davis—5 minutes in reply.

KELVIN DAVIS (Labour—Te Tai Tokerau): Oh—I am devastated, I am traumatised. You know, I am broken. I really thought that the National Government members, when they heard all the great arguments and heard the stories about people living in cars and families having to live in maraes and children doing homework by the interior light of a car and people living in tents on their relatives’ backyards, I really thought that they would say: “Kelvin, thank you very much for bringing this awesome bill to the House. This bill’s beauty is its simplicity in that we have got to have a plan and then we have got to implement that plan—a plan to build houses and then implementing that plan to build those houses.” Instead, I hear from their speeches that they are not going to support this bill. I am surprised.

I am very appreciative of the support from the Greens and New Zealand First and my colleagues here. It is very sad that the National Government is going to condemn yet more people to living homeless and not being to afford their own houses. Forty-one thousand people, we hear, are homeless, and that looks like it is going to continue.

At question time today I listened to the leader of the Labour Party, Andrew Little, ask the Prime Minister which of Nick Smith’s so-called successes he is most proud of: (1) building fewer houses than we did 12 years ago, (2) falling building consents, (3) selling off State houses during a housing crisis, (4) the lowest homeownership in 66 years, (5) that we have got the fourth-most unaffordable city in the world, or (6) that foreign speculators are buying more of our houses than ever before. I listened to the Prime Minister’s quite lengthy answer, and I guess I can summarise it in these three words: “Rhubarb, rhubarb, rhubarb.” He had absolutely nothing of any sort of intelligence to say about the National Government’s housing successes.

That is reinforced by what I heard from the members speaking now. First of all, Jo Hayes says to us that the National Government’s housing plan is whacking our housing plan around the ears. Well, there is a reason I never felt those whacks, because there is nothing in their housing plan, so it is a bit hard to get whacked with nothing. Then there are those words that they come out all the time with: “a comprehensive housing plan”. When I was sitting down that end of the House there, next to Megan Woods, we had a little thing going that every time we heard the National Government members say that they had a comprehensive housing plan we would say “skol”—you know, like the old drinking games at university. Well, the Speaker told us off because we were saying it so often that we were actually drowning out what the members on the other side were saying. So we started just sipping water quietly. Well, if it had been anything stronger than water we would have been rolled out of the House instead of walking out of the House at the end of question time.

Actually, it was really strange, the contradictions between what the members were saying: Jo Hayes was saying something; Matt Doocey was saying something else. It is really poor form for party members to contradict each other. Jo Hayes was saying how much they are doing, how much this Government is doing. This Government is doing this, this Government is doing that. Matt Doocey says it is not the role of the Government to fix the housing crisis. So what is it? Is it the role of the Government and the Government is doing heaps or is it not the role of the Government? We are a bit confused by the responses from the other side.

Then there was Dr Parmjeet Parmar. She said: “We’ve got to provide people with choice. People don’t want to be living in houses that are basically identical to the one next to them.” I heard her say that just now, and I am thinking to myself: “You know, if I was homeless I don’t care what the house looks like. I don’t care if it looks like the one next door or the next 10 houses down. It’s better to live in a house that is identical to the neighbours’ than to live in a car, a tent, or on a marae.”

It is really upsetting that the National Government does not want to pick up this KiwiBuild plan that will see us build—we are helping them out, and yet they do not want to accept the help that we are offering them. It is really sad, but it is not surprising, because this Government is just going to continue to condemn more people, more children, and more families to homelessness. The 41,000 who are homeless now—that number is going to rise. Thank you.

A party vote was called for on the question, That the Housing Corporation (Affordable Housing Development) Amendment Bill be now read a first time.

Ayes 59

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

Noes 61

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

Motion not agreed to.

Bills

Student Loan Scheme (First Home Repayment Diversion) Amendment Bill

First Reading

GARETH HUGHES (Green): Kia ora. Ngā mihi nui ki a koutou. Kia ora. I move, That the Student Loan Scheme (First Home Repayment Diversion) Amendment Bill be now read a first time. I nominate the Education and Science Committee to consider the bill. A home of your own used to be the Kiwi Dream. For many, particularly Generation Rent, it is just that—a dream. This bill asks the House a question: should the State, as soon as people start working, demand that they pay back their student loan as fast as humanly possible, with compulsory weekly deductions locking them into rental accommodation, or should it give those people the choice to maybe prioritise saving for a first home while working and saving in New Zealand?

We are facing a housing crisis in New Zealand. We are seeing prices rising at unsustainable levels. We heard some of the cases when the member Kelvin Davis’ bill was being debated previously. People are living in garages and speculators are getting rich flipping off houses. We heard from James Shaw that a house rose 80,000 bucks in value in the space of an afternoon. Deposit requirements have risen to over 20 percent, and getting a deposit together, particularly for young Kiwis, is harder than ever before. Once upon a time we had a homeownership culture in New Zealand. Now, with homeownership at the lowest rate in 66 years—and in Auckland twice as many people having multiple properties as there are first-home buyers—we have moved from that homeownership culture to a landlord and tenant culture.

There are countless couples who have studied at university or polytech, and they are just trying to get ahead and do what is right for their country and their economy. These countless couples are sitting around their kitchen tables, going over their numbers, and they are wondering how on earth they are ever going to get together a 20 percent deposit in this housing market.

It is incredibly hard to save for a deposit when 12 percent of your income is taken out in compulsory student loan repayments every week. Currently, anyone earning over the ridiculously—and, compared with other countries, incredibly—low income threshold of $19,000 has that 12 percent disappear every week. Then there are still taxes, saving for retirement, and the rising cost of living to pay for. I know how frustrating and insecure it is when you know that you are paying someone else’s mortgage but cannot get into a home of your own.

I want to point out that this bill is not a silver bullet to fix the student loan or housing crises, but it is a practical measure that we can enact now to help people get into their homes. My bill would allow people with student loans—and there are more than 700,000 New Zealanders in this basket—the choice to divert part or all of those 12 percent compulsory deductions into a nominated first home savings account for a period. This would make a huge difference to young people who are struggling to get together a deposit. I will give you just one example. A Bachelor’s degree graduate on the median wage in New Zealand could save $18,000 after 5 years. Add that to KiwiSaver, the HomeStart grants, and some private savings, and a deposit is actually looking realistic. At the moment that horizon is receding far off into the distance.

Practically, under this proposal, the first home savings account would be administered and held by the IRD using the existing student loan repayment scheme. The IRD would approve the money to be spent on the purchase or building of a first home. If the funds were not spent on a first home, they would be transferred back into the student loan account. I have delegated the limits to the Government to decide what they should be—a savings cap or a nominated period of time; for example, maybe 5 years. I have given those considerable powers to the Government in the spirit of compromise, so that the Government of the day can set those barriers.

I want to urge members to just stop and reflect for a second, because currently borrowers who travel overseas can access a student loan repayment holiday. Those who stay in New Zealand—who want to work, who want to save, who maybe want to start a family—they cannot access that. I think it is entirely fair and reasonable that we should give those who want to stay and work and save in New Zealand the opportunity to have a repayment break as well. Currently there are 341,500 New Zealanders making those compulsory 12 percent weekly loan repayments, and I believe we can help those thousands of young Kiwis into homes. That is going to encourage them to stay in New Zealand, which is actually, in the long term, going to help with the current student loan repayment.

The bill, basically, says, in a nutshell, that secure housing is important. We need to give people a pathway into their own home, and, look, if it takes a little bit longer to pay off their student loan, I think that is reasonable. Trying to make life easier should not, however, be seen as support for the student loan scheme. Student loans, and the outstanding $15 billion in debt, are themselves deeply unfair, and need to be drastically reformed. I believe that students should not be borrowing to live, and we should be returning to fee-free education. There needs to be much, much more done to fix the housing crisis—starting with building homes, a capital gains tax not on the family house, and rental law reform—but in the short term, under the current National Government, I am proposing this bill as a practical solution to help hundreds of thousands of Kiwis right now.

I began this speech saying that I was asking a question: should we demand that loans are paid as fast as possible, or should we allow people to save their own income for their own home? The bill also asks this House a broader question: is this House committed to intergenerational equity? For my parents’ generation, there was guaranteed superannuation at 65, support to get into a house, free education, and universal student allowances, but for my generation, superannuation at 65, an affordable education, and, most of all, a home to call your own are considered luxuries. I have got a bit of a personal example. Probably in contrast to the vast majority of members in this House, I had to borrow to study, I paid interest on my student loan while I was studying, I received no State support to help buy a home, and I am going to have to retire later than many members.

I believe in intergenerational fairness, and I hope this bill, and the consideration by this House and a select committee, can take us a little bit closer to intergenerational fairness. This House can help hundreds of thousands of people who are sitting around those tables, looking over their receipts, looking over their incomes, and seeing their 12 percent taken out compulsorily every single week. They want a little bit of hope. They want to have a bit of that Kiwi Dream, which is a home to call their own, to raise their family in. I hope that this House can help.

Dr JIAN YANG (National): This bill intends to assist New Zealanders with student loans in purchasing their first homes. I respect the intention of the member Gareth Hughes. As a former university lecturer, I have always believed that we should support our graduates—and, whenever we can, we do that. But this bill has some fundamental problems. The No. 1 problem, of course, is that it is simply too expensive. It is estimated that this legislation would have an operating cost of about $80 million or $200 million—that is the operating cost—and then you could have a one-off impairment cost of about $1.2 billion.

This is on top of the huge investment the Government has put into supporting our university students. This Government, in the past financial year—the 2015-16 financial year—has spent over $1.14 billion on financial support for our university students. We should remember that the Government covers 82 percent of the full cost of the tertiary education provision for our students—82 percent of the full cost. That is a lot of money.

The dilemma here is that, on the one hand, we believe it is necessary to have wide access to our tertiary education system, because we can see the benefit. We understand that with a higher level of education, New Zealanders will have better outcomes, and it will also have a major social and economic benefit for society. For that reason, we believe our student loan scheme is doing well. It is particularly important in encouraging students to come to universities, in enhancing higher-level education participation.

But, on the other hand, we have a major challenge, and that challenge is sustainability—whether we are able to retain this kind of scheme, whether we are able to afford it. That is a major challenge. We should remember that this Government is committed to retaining the interest-free student loan scheme, and also that it is very expensive. At the same time, we should also remember that the Government is currently writing off about 40 percent of each dollar lent through that scheme—about 40 percent of each dollar, we are writing off. That is a huge cost to this Government. On the one hand, as I said, we would like to support our students; on the other hand, we need to consider the sustainability issue. This is a dilemma.

Currently, we believe, our student loan scheme is working well. We are able to retain a balance between affordability and helping our students, so there is no need to make any significant changes at this stage.

There is another issue: the interests of future generations. If we are overspending today, our future generations will have to take responsibility to pay it back, so it is important for us to make sure that we are using money responsibly—and this is a responsibility not only to our current generation but also to our future generations. For that reason, this Government has been trying to manage its finances very, very responsibly.

That is the first problem with this bill—that it is too expensive. The second problem with this bill is that it is not necessary. There is no statistical evidence to support the claim that student loans are, basically, somehow deterring people from having their first home or starting their family. There is a linkage between the size of a student loan and the size of a mortgage, and that is that if you have a large-sized student loan, you may need to consider the size of your mortgage. But there is no clear evidence to support the claim that the presence and size of a loan would perhaps deter people from having a home. There is no clear evidence to support that. Similarly, there are also people who argue that student loans are somehow deterring people from having families or having children earlier, or that they may have an impact on the number of children. This, again, is not really scientifically supported.

I will digress a little bit here. In China we had a one-child policy for generations, and then we had the problem of an ageing society and also the issue of gender imbalance. So the Chinese Government abolished the policy, and people in China can now have two children. But in the major cities in China, people are not having two children; they prefer having one child. This is not because they have student loans, but because of other social or economic factors, such as the pressure of work. So we do have to consider many other factors when it comes to some phenomena.

Back to this bill—I would say that education is a kind of investment. You borrow now, in the hope of getting more return in the future. There is evidence to support this claim. The higher the level of education you have, the better income you will have in the future. People with a Bachelor’s degree will earn 40 percent more, on average, than national median earners, after 5 years in the workforce.

According to Universities New Zealand, research shows that a typical university graduate will earn around $1.6 million more over their working life than a non-graduate. This is much higher for medical doctors, at $4 million; professional engineers, at $3 million; and information technology graduates, at $2 million—and it is still high for arts graduates, with an average earnings premium of around $1 million to $1.3 million. So education is a kind of investment: you borrow today for a higher education, and, in the future, you have a better income. This means that people with a higher education tend to be able to afford their living, their homes.

Also, a question here is whether borrowers are left with large debts for many years. This bill is related to those who are staying in New Zealand. Borrowers who remain in New Zealand—for example, of those people who graduated in 2014 but stayed in New Zealand, half of them will settle their loans in 6½ years, while three-quarters of them will have repaid their loans in just over 11 years. This is a kind of forecast for our students, for graduates.

Also, I would emphasise that this Government has made a consistent effort to enforce payment. Basically, this Government has made it clear to all student loan borrowers that it is their responsibility to repay. An information-sharing agreement between Australia and New Zealand last year has helped us to locate 50,000 student loan borrowers in Australia with a combined loan balance of $1.2 billion. That is what we have been trying to do. Also, since 1992, when this scheme began, more than 500,000 borrowers have now repaid in full. We need to respect those people and we need to make sure that our policy is fair to those people. Thank you.

Debate interrupted.

The House adjourned at 10 p.m.