Wednesday, 24 May 2017

WEDNESDAY, 24 MAY 2017

WEDNESDAY, 24 MAY 2017

Mr Speaker took the Chair at 2 p.m.

Prayers.

Points of Order

Estimates Debate—Editing of Questions Submitted by Opposition Members

CHRIS HIPKINS (Labour—Rimutaka): I raise a point of order, Mr Speaker. I would like to raise an issue with you, which I would like you to take away and give some further consideration to. It has come to my attention that a number of select committees have, by majority, voted to edit or amend questions that were submitted by members of the Opposition for the forthcoming Estimates hearings. The committee can, of course, by majority, determine which questions it wishes to lodge. However, the only recourse that an Opposition member then has to get that information is to lodge a written parliamentary question. Ministers have, in the past, used the written parliamentary question and answer system to refer members to the Estimates or the annual review question and answer process.

The thing that I would like you to give some consideration to is the situation where members are blocked from asking a question or from asking the totality of the question they wish to ask, by majority, at a select committee and subsequently ask that question as a written parliamentary question. I would like to seek some reassurance from you that there is an obligation on the Minister to answer that question fully and not simply refer the member back to the Estimates or the annual review process.

Mr SPEAKER: I will certainly have a look at the point the member is raising—very seriously, in fact—but my initial reaction to the comments about amendments occurring to questions by a select committee is that it becomes a select committee decision and, therefore, if the majority of a select committee votes in one particular way, that is it. But I would be very worried if the mechanism then became an attempt to subvert the obtaining of the right information by all members of Parliament. So I will look at the matter and come back to the member.

Oral Questions

Questions to Ministers

Housing Affordability and Availability—Commentary and Auckland Homeownership Rates

1. ANDREW LITTLE (Leader of the Opposition) to the Prime Minister: Does he agree with the Hon Alfred Ngaro that some of the media are manufacturing the housing crisis; or does he agree there is a housing crisis, given Auckland has a shortage of 40,000 homes according to Auckland Council?

Rt Hon BILL ENGLISH (Prime Minister): No, and no.

Andrew Little: Does he not see that threatening and intimidating NGOs falls so far below acceptable standards of ministerial conduct that if he fails to take action against the Minister who made those threats, it amounts to tacitly endorsing them?

Rt Hon BILL ENGLISH: That is a bit rich coming from the Labour Party, which invented intimidating and threatening people who do not agree with it. But I will tell you what is below acceptable behaviour. What is below acceptable behaviour is having a policy that says it wants more houses, but opposing actual developments, including voting against the Point England bill in this House yesterday.

Andrew Little: I raise a point of order, Mr Speaker. That was a question that referred to ministerial standards and, effectively, his position on them. It did not call for a discourse from the Prime Minister on his view about Labour’s policies on housing. He has not addressed the question.

Mr SPEAKER: When I reflect on the question, the suggestion of intimidating NGOs—the Prime Minister certainly took the opportunity to refer to that part in his answer. The latter part of his answer, I do accept, was probably not helpful to the order of the House.

Andrew Little: Who does he blame for the shortage of homes in Auckland? Is it the media’s fault, the Salvation Army’s fault, the council’s fault, Aucklanders’ fault, or does the buck stop with his Government, which has had 9 years to address the housing crisis and it is only growing worse every year?

Rt Hon BILL ENGLISH: All of those parties have contributed to what is now very significant positive progress building in Auckland. The one party that has not is the Labour Party, which has been opposing the Three Kings development and voting against the Point England enabling bill that will allow for thousands of houses to be built in Tāmaki on conditions appropriate to the local tenants. So if there is anyone most directly to blame for stopping developments, it is the Labour Party.

Andrew Little: Does this Treasury briefing, dated September 2016, to him show that the rate of Auckland housebuilding has been less than what is needed to keep up with population growth the whole time he has been in power?

Rt Hon BILL ENGLISH: There are all sorts of official guesses about how many houses Auckland might need. What we know is that there is the largest construction boom ever going on in Auckland, and house prices are flattening out and in some places falling, so, clearly, some demand is being met. But, of course, there needs to be a lot more build. That is why we have the $1 billion Housing Infrastructure Fund, and the Government building programme, which will, over the next few years, continue the very strong growth in building going on in Auckland.

Andrew Little: Do Statistics New Zealand reports show that homeownership has fallen in each of his 9 years in power, while housing costs have risen more than twice as fast as wages?

Rt Hon BILL ENGLISH: Statistics New Zealand reports do not cover the fact that the Labour Party’s opposition to two of the largest developments in Auckland is driving up costs and rentals. At the same time as in public it is saying it favours more houses, in private it is stopping two large developments.

Andrew Little: Taking that last answer as yes, does he expect to see a lift in homeownership this year?

Rt Hon BILL ENGLISH: That will depend on whether the Labour Party starts supporting the Point England development, which will have an impact on thousands of houses in Tāmaki, and whether it withdraws its opposition to the large-scale Three Kings development, which would enable well over a thousand affordable homes to be built for constituents who vote for the Labour Party, as it happens.

Andrew Little: Putting aside the Salvation Army, when will he finally apologise to Kiwi families for soaring house prices, skyrocketing rents, and growing homelessness during his 9 years; or is it someone else’s fault?

Rt Hon BILL ENGLISH: The people who should be apologising are the Labour Party members, for two reasons. One is that they gave the Auckland Regional Council the power in the early 2000s to set a rural-urban boundary, and from that time new building in Auckland was strangled. It has taken us a number of years to unwind the damage. The other reason they should apologise is that they are opposing large developments in Auckland. So their KiwiBuild policy is, in reality, a no-build policy.

Government Financial Position—Surplus, Treasury Forecasts, and Tax Rates

2. DAVID SEYMOUR (Leader—ACT) to the Minister of Finance: What are Treasury’s forecast OBEGAL surpluses for each year to 2021, according to the December Half Year Economic and Fiscal Update?

Hon STEVEN JOYCE (Minister of Finance): According to the Half Year Economic and Fiscal Update (HYEFU) the Crown’s operating balance before gains and losses surpluses rise from $473 million in the current financial year to $3.34 billion in 2017-18, $5.31 billion in 2018-19, $6.7 billion in 2019-20, and $8.5 billion in 2020-21. If the member would like me to read him the rest of HYEFU, I am happy to do so.

David Seymour: Does he agree with Prime Minister Bill English, who said “Lower personal tax rates reward [effort] and give people an increased incentive to up-skill, develop new products and services, and get ahead under their own steam. This has strong benefits for the economy.”; and if he does not agree, why not?

Hon STEVEN JOYCE: That sounds like an eminently sensible quote from the Prime Minister.

Hon David Parker: Does the Minister of Finance have any advice for the questioner, who is a member of Parliament earning more than $150,000 who cannot afford to save to buy a house?

Mr SPEAKER: In so far as there may be minor ministerial responsibility, does the Minister have any advice?

Hon STEVEN JOYCE: I would say that my suggestion to anybody in that situation would be to, first, probably put some money in the bank. [Interruption]

Mr SPEAKER: Order! I am just waiting so can I get a bit less interjection from my left.

David Seymour: Does he agree with former Prime Minister John Key, who said “the argument will be ‘why is the Government, when debt is well and truly on track for its target of GDP to be below 20 per cent, why is the Government building bigger and bigger surpluses?’ ”; if not, why not?

Hon STEVEN JOYCE: I do not recall that particular quote from the former Prime Minister, but I was generally in agreement with most of the things that he said.

David Seymour: Is it the case that the Minister really agrees with former Labour Minister of Finance Sir Michael Cullen, who said “$8.5 billion surplus and still no tax cuts. So? What’s the connection between the two? None.”? If he does not agree with that quote from Sir Michael Cullen, what exactly has changed in the last 9 years?

Hon STEVEN JOYCE: No, I find I generally do not agree with the quotes of the former Labour Minister of Finance Sir Michael Cullen, and I do not see any particular reason to change my view on that quote.

David Seymour: If Treasury is indeed forecasting surpluses that add to $24 billion over the next 4 years and he agrees that lower personal tax rates increase growth and productivity, then would he like to visit www.act.org.nz/tax and use ACT’s tax plan to find out how much he could save if he adopted ACT’s tax policy?

Hon STEVEN JOYCE: I thank the member for his advice. I have indeed visited that website, and one thing I found is that, actually, it had a lot more policy than the Labour Party website that I went to.

Budget 2017—Social Investment, Health Spending, and Government Medium-term Financial Position

3. MATT DOOCEY (National—Waimakariri) to the Minister of Finance: How will Budget 2017 make a difference to New Zealanders most in need?

Hon STEVEN JOYCE (Minister of Finance): Improving public services is one of the key priorities of this Government, and in this Budget, to ensure all New Zealanders have the opportunity to lead successful, independent lives. The Prime Minister announced the other day a $321 million social investment package that will form part of the Budget. This is an initiative that tackles our most challenging social issues by intervening early and using evidence and data to design the initiatives. The Government is focused on targeted investments in the areas where we can make the most difference. Too often past Governments have judged success only by what they spend rather than what difference the spending makes to people’s lives.

Matt Doocey: What investment has the Government made in the health sector?

Hon STEVEN JOYCE: As part of Budget 2017, the Government has made two announcements already: investing an extra $60 million over 4 years to enable Pharmac to provide more New Zealanders with access to new medicines. That will take Pharmac’s total budget for next year to a record $870 million, which is a $220 million increase in the annual budget since 2008. The Government is also investing an additional $59.2 million to ensure all road ambulance call-outs are double-crewed. This will create 375 new emergency medical and paramedic roles across the country over the next 4 years to ensure patients get the best ambulatory care possible.

Matt Doocey: How will New Zealanders retain access to entitlements during unexpected shocks?

Hon STEVEN JOYCE: The global financial crisis and the Christchurch earthquakes have taught us all that shocks can come along at any time. That is why it is important to build fiscal resilience to ensure that when shocks do occur the Government can continue to support New Zealanders. The Government has a target to reduce net debt to around 20 percent of GDP by 2020 and will set a new medium-term fiscal target of reducing net debt to between 10 and 15 percent of GDP by 2025 to build that resiliency so we can respond if and when required.

Matt Doocey: What risks does the Minister foresee to the Crown’s financial position over the medium term?

Hon STEVEN JOYCE: The significant investments that I have already talked about and, in fact, Budget 2017 overall rely on a couple of key factors. The first is making sure the Government’s books remain in surplus while restraining the State’s spending requirements. The second is a growing economy. The Government does need to ensure that its strong economic plan continues to deliver stable growth, and this momentum needs to be maintained to ensure that New Zealand is in the best position to weather future shocks.

Budget 2017—Spending Increases in Relation to Population Growth and Inflation

4. GRANT ROBERTSON (Labour—Wellington Central) to the Minister of Finance: Is Colin James correct when he says that a 4 percent increase in spending in Budget 2017 is required just to stand still, given population growth and inflation; if not, what increase is required?

Hon STEVEN JOYCE (Minister of Finance): No, I have seen Mr James’ calculations this morning, and I do not agree with his assumptions, because he leaves out the matter of productivity, and the Government is, of course, focused on boosting productivity, including in the public sector. We do not measure success by how much we spend but on whether it meets the Government’s needs for results and whether we are getting the results those investments are generating on behalf of taxpayers.

Grant Robertson: What percentage difference would including productivity make to Mr James’ calculation?

Hon STEVEN JOYCE: The Government does not just say: “Here’s the public sector and we should throw a lot more money at the public sector regardless of the results that investment would achieve.” I know that is the Labour Party’s approach. The Labour Party likes to say to the unions in particular “How much money do you need for the PSA?”, and when they give it the answer, it just hands over the money. That is how it works in a Labour Government but not in a National Government.

Grant Robertson: Can he guarantee that he will fund the health budget for the real cost of inflation and demographic change in this Budget and start the process of restoring the $1.7 billion of underfunding caused by his Government failing to do this for the last 6 years?

Hon STEVEN JOYCE: I completely reject the number that the member uses. It is absolutely wrong. And do you know how you know it is wrong? Because the performance of the health sector has improved under this Government—

Dr David Clark: That’s not true.

Hon STEVEN JOYCE: —improved—at exactly the levels of investment we have made, and I will give the member an example. A recent New Zealand Medical Journal article said thousands of lives have been saved by productivity improvements in hospital emergency departments after targets were introduced in 2009.

Grant Robertson: You’re not in the real world, Steven.

Hon STEVEN JOYCE: That is real productivity improvements in the real world, not like Mr Robertson, who would just throw money at whatever sector he saw.

Dr David Clark: I seek leave to table a report that says that there have been no productivity improvements in the health—

Mr SPEAKER: Order! I need the source of the report.

Dr David Clark: It is a Treasury document.

Mr SPEAKER: And is it publicly available?

Dr David Clark: It is, but the Minister clearly—

Mr SPEAKER: Order! I would be grateful if the member would not waste my time. It is publicly available. Members can look for it if they want.

Grant Robertson: Will any increased funding for the accommodation supplement in tomorrow’s Budget take account of the 10 percent increase in median weekly rents in the last year?

Hon STEVEN JOYCE: Well, the member is sidling up to asking me to reveal the details of the Budget tomorrow in any number of respects. Could I make a suggestion to him that within 24 hours he will get his wish and hear what is in the Budget?

Grant Robertson: Do schools, parents, and teachers deserve to see a real per-child funding increase in this Budget for schools?

Hon STEVEN JOYCE: Once again, he will find out in the Budget tomorrow. But, again, in terms of investment, it is not important about the inputs; what are important are the outputs. This Government has shown, over 8 years, that it is about results, and the Labour Party, it appears, is still back in 2008 and is all about pouring the money in and forgetting about the results.

Grant Robertson: Is it not time that he was straight up with New Zealanders about what his Budget numbers mean, given that the head of business for New Zealand Media and Entertainment, Fran O’Sullivan, said this morning: “He’s”—Mr Joyce—“already been caught out by Labour’s Grant Robertson when it comes to massaging numbers on … infrastructure.”? Modestly, I say that.

Hon STEVEN JOYCE: And thousands and thousands of New Zealand Herald readers said: “Who?”. [Interruption] But the simple fact of the matter is the member is wrong—and, actually, on this occasion, the eminent Ms O’Sullivan is wrong—because, actually, the infrastructure spend has gone up since Budget 2016, and when the member sees the numbers tomorrow, he will find out that if anybody knows who he is, it will be because he mucked up the numbers.

Freshwater Management—Water Allocation Prioritisation and Commercial Access

5. METIRIA TUREI (Co-Leader—Green) to the Minister for the Environment: Does he agree with Environment Canterbury councillor Lan Pham that the way water is allocated does not always prioritise public use over private gain?

Hon Dr NICK SMITH (Minister for the Environment): The law gives priority to water use for domestic supplies, for firefighting, and for stock drinking water. These uses have preferential access over commercial users like irrigators, industry, or bottled water companies. Our Government has also strengthened the public good considerations in water allocation with New Zealand’s first National Policy Statement for Fresh Water, which requires regional councils to set minimum flows in our rivers for ecological and recreational purposes. We have further work under way on improving New Zealand’s freshwater allocation system, with a technical advisory group doing work right now on how we can further improve it.

Metiria Turei: Does the Minister agree with Hurunui resident Colleen Johnson, who has put up with a permanently E.coli-poisoned water supply and says: “New Zealanders, we should have first priority; the high-quality water should be coming to us.”

Hon Dr NICK SMITH: In respect of the quality of water supplies, there is a job for councils to improve their performance in that regard. But I would caution the member against saying that as a consequence of water users taking water for irrigation and for other uses that are so important to the economy—that should not compromise, in any way, New Zealanders’ access to good domestic water supplies. I remind the member that total extractive use of water in New Zealand is only 2 percent of the total resource New Zealand has.

Metiria Turei: Does the Minister, then, think it is fair that private companies like water bottlers can access pristine, fresh water, while the public, like Colleen Johnson and her family, have to put up with E.coli contamination and dirty rivers?

Hon Dr NICK SMITH: Our law provides for any person being able to apply for a consent for New Zealand’s water resources. That same law says that if there is ever a choice between domestic water supplies or essential uses like firefighting, they take preference over commercial users, and that is appropriate. I am not satisfied that our councils are doing an adequate job of managing New Zealand’s freshwater resources. That is why our Government introduced the very first national policy statement providing clearer direction on the need for New Zealand to lift its game around freshwater management.

Richard Prosser: Will he support New Zealand First’s policy of any potential charge that is applied volumetrically to consented water takes being confined to a royalty only on the export only of water as water only; if not, why not?

Hon Dr NICK SMITH: I have seen New Zealand First proposals for a 10c-per-litre charge on all commercial water users. That would cost our dairy industry $600 billion a year, and effectively destroy New Zealand’s largest export industry. Those facts just reinforce the fact that in the discussion around allocation and pricing of water, we need to do it with a great deal of care and thought.

Richard Prosser: I raise a point of order, Mr Speaker. My question was: would the Minister support our policy of a charge being confined to a royalty on export only; not to some other policy that he claims to have seen, which he has not because it does not exist.

Mr SPEAKER: That is now very much a debating point. The member asked whether a New Zealand First policy would be supported by the Minister, and the Minister has taken his opportunity in interpreting that policy the way he sees it. It becomes very much a debating point. The general debate follows shortly, and I note that New Zealand First has the first opportunity to lead that debate.

Metiria Turei: If the technical advisory group on water recommends putting a charge on its commercial use, will he commit to supporting that recommendation?

Hon Dr NICK SMITH: No. The Government will consider the report on its merits. I would commend the editorial that was published in the New Zealand Herald this week, which rightly said that any approach to charging of water does need to be done with care, because for a very large portion of New Zealand’s export industries, a blunt approach like that—I have heard from the member’s own party—would do very significant damage to the New Zealand economy.

Metiria Turei: Does he, then, think it is right that water bottling company Antipodes pays only $99 a year for the right to bottle water but charges $7.67 per litre to its customers?

Hon Dr NICK SMITH: The member needs to be careful in making comparisons. For instance, Auckland Council, which has a very large consent to take water out of the Waikato River, pays a bare administrative fee for a consent that is more than 10,000 times larger than that. Too often, people are confusing the cost of the pumping, the filtration, and the piping of water to the natural resource. All users currently are paying only for an infrastructure cost, and not a cost for the natural resource.

Metiria Turei: I raise a point of order, Mr Speaker. It was a clear question as to whether he thinks that is right or not; he did not answer that question.

Mr SPEAKER: No. Can I just take the opportunity of asking members to look at two Speakers’ rulings that might help them in formulating their supplementary question. The member asked: does the Minister think that it is fair? If the member now looks at Speaker’s ruling 195/6 and 195/7, it acknowledges that we do allow opinion questions, but the chances of getting an answer that is satisfactory to the member are very slight.

Metiria Turei: Does the Minister think that it is right that water bottling companies tell their overseas clients that they can supply an infinite quantity of clean water, while the New Zealand communities that they take that water from have to put up with boil notices and dirty rivers?

Hon Dr NICK SMITH: Anybody who claims that they have got a consent for an infinite amount of water clearly does not, because every permit that is granted has some limit, albeit I would draw the member’s attention to the fact that water bottling companies make up such a small fraction of New Zealand’s overall water take that if we want to have an intelligent discussion about improving New Zealand’s water management, it is those very substantive users like irrigators and industry that should be the focus of our attention.

Budget 2017—Department of Conservation Funding

6. ANDREW BAYLY (National—Hunua) to the Minister of Conservation: What announcements has she made about increased support for the Department of Conservation in Budget 2017?

Hon MAGGIE BARRY (Minister of Conservation): I was very pleased to pre-announce so far that in Budget 2017 there will be a $76 million funding injection for new and upgraded visitor facilities and experiences on New Zealand’s conservation estate—that is the largest increase the Department of Conservation (DOC) has ever had in its 30-year history. This Budget package will let DOC get on with its job of providing quality experiences on conservation land while still maintaining the conservation work necessary to protect our natural environment and threatened species. We will create a predator-free New Zealand by 2050 and preserve our wonderful landscapes for everyone to see and enjoy. In addition, I have announced a $21 million Battle for our Birds, the largest predator control programme ever undertaken in New Zealand, and, as part of the Threatened Species Strategy I released 2 weeks ago, a $2.8 million injection into the sea lion threat management strategy.

Andrew Bayly: What projects will the new money fund?

Hon MAGGIE BARRY: The benefits of this funding injection will be felt right across the country. DOC will be upgrading facilities that are under pressure to ensure that the visitor experiences remain top class. We will be building two great walks and putting together a package looking for shorter walks with a new network of great day and great short walks. Importantly, this level of investment will deliver more visitors, who will have better experiences, and, therefore, it will deliver more revenue to DOC, which can then be reinvested in biodiversity and species protection.

Clayton Mitchell: Why does the Minister not keep it real about the situation and agree that under her leadership, DOC has been on a hiding to nothing, with this proposed increase in spending coming nowhere close to the $336 million—$336 million—National has cut from its coffers since it was in power?

Hon MAGGIE BARRY: The member is misinformed on this and on many other subjects. Expenditure for DOC—[Interruption]—and if you listen carefully, you will learn something, has increased by 20 percent, and that is from $311 million in 2008-09 to $374 million in 2015-16. That is an increase of $63 million. There is more species protection being done in New Zealand from DOC than at any other time in New Zealand’s history. We have a Threatened Species Strategy that points to and focuses on our most at-risk species. We are paying more attention to this than ever before. There has been no reduction in DOC spending and allowances.

Andrew Bayly: What other announcement has she made on increased funding for DOC’s biodiversity work?

Hon MAGGIE BARRY: I have also announced the $21 million funding increase to launch the Battle for our Birds in 2017. That is in direct response to a beech mast or seeding event. It is a major predator control operation, and what members need to appreciate is that predator control across 800,000 hectares will save a lot of species, protect a lot of habitats, and improve the lot for biodiversity. We will deal with the plague of rats and stoats that threatens our native wildlife, and with this money DOC will be able to carry out real predator control, in conjunction with the wilding predator control that we are doing across wilding pines. There are a whole range of species protections, and our species and our biodiversity are the real winners here.

Emissions Trading Scheme—Efficacy

7. DENIS O’ROURKE (NZ First) to the Prime Minister: Does he stand by all his statements?

Rt Hon BILL ENGLISH (Prime Minister): Yes.

Denis O’Rourke: If he stands by his statement that the emissions trading system (ETS) “tells us that if you pay the price for carbon, that helps us find the most efficient means of changing the climate”, can he cite any example anywhere where a tax has demonstrably helped to reduce the emissions causing climate change?

Rt Hon BILL ENGLISH: In answer to the first question, yes; in answer to the second question, the New Zealand electricity market.

Denis O’Rourke: Is his Government’s emissions trading scheme a reverse Robin Hood, given that it has already transferred over $2.3 billion from hard-working families, businesses, and farmers to foreign carbon traders?

Rt Hon BILL ENGLISH: No. In the past we have welcomed New Zealand First’s support for the carbon trading system. As I recall it, the leader of New Zealand First was an advocate for the forestry industry, which is one of the industries that have helped to contribute to the successful operation of the emissions trading system.

Denis O’Rourke: Why is his Government still transferring $1.4 billion every year to enrich foreign traders operating in a failed and immeasurable ETS?

Rt Hon BILL ENGLISH: I just do not agree with the member’s assertion.

Denis O’Rourke: How can he falsely say that the emissions trading system has “multiparty … support”, when New Zealand First would abolish it so that the $1.4 billion could be invested in a range of other actions, including research and development, insulating homes, planting forests, and implementing electrification in transport?

Rt Hon BILL ENGLISH: I would say it has multiparty support because it has. New Zealand First did support it when it came in, and, in fact, if the member wanted those things to happen, and they were worthwhile, then under the emissions trading system they will happen. In fact, some of them are happening now because of the emissions trading system.

Offenders—Monitoring

8. TODD BARCLAY (National—Clutha-Southland) to the Minister of Corrections: What recent announcement has she made regarding drug and alcohol testing for offenders in the community and defendants on bail?

Hon LOUISE UPSTON (Minister of Corrections): Yesterday the Minister of Police and I announced a new initiative in which Police and Corrections will monitor and test offenders and people on bail with conditions not to consume alcohol or drugs. It allows staff to target those with the highest risk of causing alcohol-related harm with more intensive testing and monitoring. The main form of testing will be urine testing, and police will use existing breath-alcohol testing technology throughout the country. Some high-risk offenders and people on bail will be fitted with alcohol-detection anklets as part of this monitoring. These anklets detect alcohol in sweat, and provide evidence if offenders or people on bail have consumed alcohol against their abstinence conditions. The new legislation empowers staff to get evidence about drug and alcohol consumption. Staff can then take action, giving further treatment or sanctions to offenders who have breached their conditions.

Todd Barclay: How will this new initiative help to reduce reoffending?

Hon LOUISE UPSTON: Harmful alcohol and drug use is a major driver of crime. About half of crime is committed by people under the influence of alcohol or drugs. Providing extra support to offenders who are struggling with addiction is a step towards helping them make a positive change to their lives. Negative tests can provide evidence of sobriety to employers and help offenders get a job, reducing their chances of reoffending. At recent employer breakfasts that I have hosted, I have met employers who are so keen to employ more offenders, which is absolutely great news.

Mahesh Bindra: What assurance can she give that this monitoring system for drug and alcohol use will be just as effective as the supposedly “uncuttable” ankle bracelets, which needed only a pair of scissors?

Hon LOUISE UPSTON: One of the clear challenges with the anklets is if an offender has an accident or if they have an illness that creates swelling. We absolutely do not want to be in a position that has occurred in other countries that has meant serious, serious injury because of the anklets. So, yes, there is the ability, in the case of an emergency, to have it removed, which means greater outcomes for the offender.

Mahesh Bindra: Why are taxpayers shelling out their money to pay a company in the United States to monitor Kiwi offenders, and just what does that say about our Government’s commitment to employing Kiwis and Kiwi technology companies?

Hon LOUISE UPSTON: We are serious in Police and Corrections about reducing levels of crime. We want to use technology that has been tested thoroughly overseas and is used by other countries. In this case, this technology is new to New Zealand, and I think it is an exciting opportunity to give offenders a new opportunity to support their compliance. We want to use technology that is tested.

Todd Barclay: What other interventions is Corrections targeting at offenders with alcohol and drug issues?

Hon LOUISE UPSTON: As part of an $8.6 million package from the Justice Sector Fund last year, Corrections is also providing extra support to offenders with alcohol and drug needs. These initiatives include a 24/7 alcohol and drug support line for offenders and prisoners, and that line will be staffed by experienced, registered alcohol and drug practitioners. The ‘RecoveRing’ support line goes live on 24 May. There are also 16 new alcohol and drug aftercare workers employed in prisons across the country since July last year, and, in addition, over and above the existing beds that are used for residential treatments, an additional 13 residential beds in treatment facilities with offenders with significant alcohol and drug needs.

Social Housing, Associate Minister—Statements on Homelessness and Commentary

9. CARMEL SEPULONI (Labour—Kelston) to the Associate Minister for Social Housing: Does he stand by his statement “The Government takes its responsibility around homelessness seriously”; if so, why did he say some of the media were manufacturing a crisis?

Hon ALFRED NGARO (Associate Minister for Social Housing): Yes, I do stand by my statement that we take our responsibility for homelessness seriously.

Mr SPEAKER: Order! There is a second part to the question. There are two parts to the question. The Minister has addressed the first part, not the second part.

Hon ALFRED NGARO: Yes, I do stand by my statement that we take our responsibility for homelessness seriously. That is why last year we committed $354 million for emergency transitional housing, the first time any Government has invested in the sector. We are on track to have, by the end of June, 1,598 of these transitional housing places available at any one time. This will help around 6,392 families a year. In Auckland we are on track to deliver 621 houses. This will support 2,484 Auckland families a year. Also, I apologise for my statements that I have made.

Chris Hipkins: I raise a point of order, Mr Speaker. As with yesterday this was a primary question on notice, and it asked why he said that some of the media were manufacturing a crisis. Whilst he had a long answer, he did not address the second part of the question.

Mr SPEAKER: The question has not been addressed. It is a question on notice. The way forward is that I am going to invite Carmel Sepuloni to start the question again. There are two very definite parts to the question, if there is an affirmative to the first part of the question. With questions to Ministers they have got plenty of time to prepare and they should be able to answer questions. Carmel Sepuloni—to start question No. 9 again.

Carmel Sepuloni: Does he stand by his statement “The Government takes its responsibility around homelessness seriously”; if so, why did he say some of the media were manufacturing a crisis?

Hon ALFRED NGARO: Yes, I do stand by my statement that we take our responsibility for homelessness seriously. In regard to the second part, I have apologised for my comments.

Chris Hipkins: I raise a point of order, Mr Speaker. The second part of the question asked him why he made the comment. He may regret it and he may have apologised for it, but it does not explain—he did not answer—why he made that comment.

Hon Simon Bridges: I think that in apologising, clearly the inference is that he was wrong in making it and that is the reason for that second limb. [Interruption]

Mr SPEAKER: Order! I do not accept the final point made by the Hon Simon Bridges. We have now had two attempts. At the end of the time, I am not responsible for the answers that Ministers give. My duty here is to attempt strongly to get an answer that addresses the question. I do not think it has been addressed. We have had two goes at it. The way forward is I will allow Carmel Sepuloni two additional supplementary questions as she proceeds through her supplementary questions.

Carmel Sepuloni: Why did the Associate Minister say that the media were manufacturing a crisis, with regard to the housing crisis we face as a country?

Hon ALFRED NGARO: I regret the comments that I have made, and I have apologised for those comments.

Chris Hipkins: I raise a point of order, Mr Speaker. An apology does not negate a Minister’s requirements to answer why he made a comment.

Mr SPEAKER: I am going to invite Carmel Sepuloni to repeat the supplementary question for the benefit of the Minister.

Carmel Sepuloni: Why did he say that the media were manufacturing a crisis, with reference to the housing issues we are facing as a country?

Hon ALFRED NGARO: I regret the comments that I have made. I made them ill-informed, I regret those comments, and I do apologise for them.

Carmel Sepuloni: Just answer it.

Mr SPEAKER: It was answered on that occasion.

Carmel Sepuloni: Has the Minister apologised for his comments about the media manufacturing a crisis because he recognises now that he was wrong, that the media have not manufactured a housing crisis, and that, in fact, his Government is responsible entirely for it?

Hon ALFRED NGARO: I own my own comments. I do apologise for them. They were ill-informed, and I have apologised for those comments that I made.

Carmel Sepuloni: Is he aware that the number of people on the social housing register classified as homeless has doubled in a year; if so, does he apportion the blame for this to (a) John Campbell and the media, (b) Alan Johnson and the Salvation Army, or (c) his Government?

Hon ALFRED NGARO: I refer the member to the announcement made by my colleague Minister Adams earlier this month, which shows that our hard work is coming to fruition. We now have secured 870 places, which will increase emergency housing places by 133 in under 2 months. We have more coming on board all the time. In fact, we are on track to have 1,600 places available by winter. That will help around 17,000 people this winter.

Carmel Sepuloni: When he met with Alan Johnson from the Salvation Army, was his intention to discuss and seek advice on the significant homelessness issue, or was it to soften him up to prevent him from speaking out on the Government’s inaction in respect of an increasing number of homeless New Zealanders?

Hon ALFRED NGARO: I have met with a number of community groups, community housing providers, along with the Salvation Army, and the work that has been ongoing, in my role and responsibility as the Minister, is to continue to engage with the likes of the Salvation Army. Our conversations were about the work that we are progressing in partnership, together, with each other.

Carmel Sepuloni: When he met with Alan Johnson from the Salvation Army, was he trying to prevent its policy unit from “running riot and saying all sorts of things”, such as “the number of houses proposed does not appear to be sufficient to meet existing and projected demands.”, when talking about the Government’s embarrassing housing announcement?

Hon ALFRED NGARO: We have continued to have a strong working relationship with the Salvation Army. There is representation from a number of groups—the external focus group is one—and we are working with a number of senior executives and getting their input into the partnership strategies that we have collectively, together.

Carmel Sepuloni: Was the 110 percent increase in the last year in the number of homeless New Zealanders on the social housing register his motivation for the Government to “push back against some of the media”; if not, what was his motivation for that attack?

Hon ALFRED NGARO: I am proud of the work that this Government has been doing. We have also been piloting a Housing First initiative in order to address the issues around homelessness. We have been working in partnership with a number of community groups in Auckland. This is an internationally recognised model that helps rough sleepers by putting them into safe, secure, and stable accommodation, and then providing wraparound services to address these issues.

Carmel Sepuloni: When he said that the controversy last year over people having to live in cars and on park benches was from “an Opposition that chooses to use their constituents for political fodder”, was he implying that constituents like the Fa’avale family living under a tarpaulin, or Tracey Penny, a tetraplegic mother living with her family in a modified van, should have just waited patiently for Government support that was never coming?

Hon ALFRED NGARO: I am proud that the Government, since last July, has introduced the emergency housing special needs grant, which pays for accommodation for those who have nowhere else to go. Over the first 6 months it was available, we have helped over 4,500 households, and, again, we are the first Government to step up and offer this kind of help to those who are most in need.

Carmel Sepuloni: I seek leave to table an unpublished report from the Parliamentary Library showing a 110 percent increase in the last year in the number of homeless New Zealanders on the social housing register.

Mr SPEAKER: Leave is sought to table that particular information prepared by the Parliamentary Library. Is there any objection to it being tabled? There is objection.

Refrigerant and Air Conditioning Industry—Environmental Impacts of Synthetic Gases

10. JOANNE HAYES (National) to the Minister for the Environment: What steps is the Government proposing to address the environmental impacts of synthetic gases used by the refrigerant and air conditioning industry?

Hon Dr NICK SMITH (Minister for the Environment): Last week we announced a plan to reduce by 80 percent the importation of hydrofluorocarbon (HFC) gases over 20 years. These gases have a global warming effect up to 15,000 times more powerful than carbon dioxide. The plan will reduce New Zealand’s greenhouse gas emissions by over 1 million tonnes of carbon dioxide equivalent per year. The environmental benefit of this initiative is equivalent to shutting down the Huntly coal-fired power station or replacing half a million cars with electric vehicles. It is part of our plan for achieving the minus 30 by 2030 Paris target.

Joanne Hayes: What portion of the global warming problem is attributable to the synthetic gases used by the refrigerating industry, and what agreements have been reached globally to address the problem?

Hon Dr NICK SMITH: It is estimated that these gases make up about 14 percent of the global greenhouse gas emission issue, so they are about one-seventh of the problem internationally. Left unabated, the use of these gases alone would raise global temperatures by about 0.5 degree Celsius. New Zealand played a very active role in securing the Kigali Amendment to the Montreal Protocol to phase out these gases. The plan we have announced will have New Zealand exceed those obligations and be one of the first countries in the world to ratify the agreement.

Joanne Hayes: Does the Minister have confidence that the industry will be able to reduce the use of HFCs so that these ambitious 80 percent reductions can be achieved?

Hon Dr NICK SMITH: Yes, I do. The industry has shown that it is up to the environmental challenge over the past 20 years, in the way that it has responded to the problem of ozone-depleting chemicals and phased out their use. We have met our Montreal Protocol obligations, and this treaty’s success is seeing the ozone hole reduce. It is estimated that 2 million cases of skin cancer per year have been saved as a consequence of that agreement. It now makes good sense that, internationally and domestically, we are now employing those same tools that have been successful in addressing the ozone issue to now assist in addressing the problem of climate change.

Health Services—Capacity Issues in Waikato and Auckland and Funding

11. Dr DAVID CLARK (Labour—Dunedin North) to the Minister of Health: Has he received reports that Waikato Hospital is advising against sick people visiting their hospital; and is advising people not to attend hospital now an acceptable strategy under his Government for reducing the gap between service demand and service delivery in the health system?

Hon NICKY WAGNER (Acting Minister of Health): No, but I have seen reports of non-urgent people being asked to check with their GPs first. It is a well-established fact that hospitals across the world can reach capacity with seasonal influxes from time to time. The Waikato Hospital has a plan to deal with such incidents of seasonal pressure, and tells me that it is already largely back to normal. Managing seasonal demand is not new. In fact, I have a quote from Dr Mills from the Waikato Hospital, saying: “From our perspective, this is just an ordinary winter.” That was dated 20 July 2006—under the Labour Government.

Dr David Clark: What action will he take in response to reports that yesterday GPs were being asked not to refer patients to Waikato Hospital until the current crisis is over?

Hon NICKY WAGNER: As I have already reported, the district health board (DHB) says that it is back to normal already. But there is a well-established practice for how you should access your emergency departments. They are called “emergency departments” for a reason. The first thing to do if you are sick is to maybe talk to a pharmacy, or talk to a telehealth; the second thing is to go to your GP, or after-hours services. If you are too sick for that, you can go to the district health board and the emergency department will look after you, just as it has done forever.

Dr David Clark: What does he intend to do about the fact that all three Auckland DHBs are now under pressure and have all reported an increase in full-bed days over recent years?

Hon NICKY WAGNER: I know the member is new to health, but he should understand that there has always been seasonal pressures on DHBs, and that they have a plan to deal with them and are doing that effectively and well.

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

Mr SPEAKER: Order! I have a point of order from Chris Hipkins.

Chris Hipkins: The Minister began her answer with an insult, which meant that many other members would not have heard the substantive answer, which, in fact, did not address the question that was asked.

Mr SPEAKER: No, I listened very carefully to the answer—it was not easy. The reason it was not easy is the clamour of interjection coming from my left. I do accept the original start of the answer was not that helpful to the order of the House, but I do point out that throughout the answers that have been given by the Minister, the member that is asking the questions has not stopped to listen to the answers because he has been interjecting too hard himself. Further supplementary questions? [Interruption] Order! I do not need assistance from the front bench to my right.

Dr David Clark: So does he now think it is acceptable for this 79-year-old cancer patient, whose picture I hold, to wait at an Auckland hospital just yesterday until nearly 6 hours after his accident for his wound to be cleaned, and made to wait 10 hours for food before an assessment for surgery could be made?

Hon NICKY WAGNER: I am afraid I cannot give you the full details of this case, but I have been assured that the clinical care was appropriate and that the gentleman was looked after well.

Dr David Clark: How much more does he expect to announce in the health budget, beyond the additional $1 billion needed for district health boards (DHBs) to fund the aged care settlement and to maintain existing service levels for a growing population, and when will he begin to pay back the $1.7 billion beyond that that he stripped out of the sector over the previous 6 years?

Hon NICKY WAGNER: I am sorry, I did not hear the beginning of that question, but what I can tell you is that every year since National has been in Government we have increased Vote Health. Right now the official advice tells me that the spend per person has gone up from $2,000 per person to $2,500. That is not a funding cut; it is an about 21 percent increase since we have been in Government—ahead of inflation, which is 15 percent. So the Government has increased Vote Health by over $4 billion, and official advice, again, tells us that the DHBs have been funded not only for increases but for their population and inflation. I would just like to make one point—

Mr SPEAKER: Order! No, the question has been answered. We do not need it to be any longer.

Dr David Clark: I raise a point of order, Mr Speaker. I seek your guidance—[Interruption]

Mr SPEAKER: Order!

Dr David Clark: I seek your guidance. Earlier you stopped me from tabling a document that would have corrected the things that the Minister said, in terms of—

Mr SPEAKER: Order! No, I did not stop you—[Interruption] Order! I do not stop you tabling anything. What is the point?

Dr David Clark: The Minister is repeating those facts, which are clearly not true, by basis of—

Mr SPEAKER: Order! [Interruption] Order! The member is now getting into a matter of debate, but if he feels there has been a deliberate case of misrepresentation, then what he needs to do is haul out his Standing Orders and read Standing Order 359, and then he will know the course of action. It is not a matter of raising it as a point of order in this House.

Community and Voluntary Sector, Minister—Statements on NGOs

12. JAMES SHAW (Co-Leader—Green) to the Minister for the Community and Voluntary Sector: Does he stand by his statement yesterday that “it is not the way this Government works”, in relation to his comments threatening funding cuts for organisations that spoke against the Government?

Hon ALFRED NGARO (Minister for the Community and Voluntary Sector): Yes, I do.

James Shaw: Then will the Minister ensure that any NGOs that publicly critique Government policies and action are protected from the threat of having their funding cut?

Hon ALFRED NGARO: All agencies are able to advocate to give advice and support to any of the strategies that Government has.

James Shaw: Given that answer, Victoria University research found that 15 percent of Government funding agreements “stated explicitly that they must not make public comment on government policies and action …”, will he now advocate for the removal of such clauses in those contracts?

Hon ALFRED NGARO: I have not seen that report, so I cannot give any advice.

James Shaw: Will the Minister consider altering clauses in the contract negotiations being concluded this June and July to ensure that NGOs, such as those working with the homeless, are able to critique Government policy?

Hon ALFRED NGARO: I have no ministerial responsibility for the contracting of those particular services that the member is talking about.

James Shaw: If he heard that senior officials had contacted NGOs to imply a threat to their funding following public statements critiquing the Government, would he say that that was unacceptable behaviour and not how this Government works?

Hon ALFRED NGARO: I have not heard of any of those reports that the member has relayed. I know and trust that in the front line of all our workers, they do the best job possible.

James Shaw: I raise a point of order, Mr Speaker. The question was whether he would say that that kind of behaviour was acceptable, not whether he had heard of it or not.

Mr SPEAKER: Can I ask the member to refer to Speaker’s ruling 180/3. Members can ask hypothetical questions but it is not required that the Minister responds to such a hypothesis—a very learned ruling given by Jonathan Hunt some years ago.

General Debate

General Debate

TRACEY MARTIN (NZ First): I move, That the House take note of miscellaneous business. Kia ora, Mr Speaker. I rise on behalf of New Zealand First in defence—[Interruption]

Mr SPEAKER: Order! I can accept some interjection throughout a general debate but it is unreasonable this amount of interjection at the very start. The member can start her speech again.

TRACEY MARTIN: Thank you, Mr Speaker. I rise on behalf of New Zealand First in defence of Alfred Ngaro, because somebody has to. It is interesting—it is shocking—to see how Alfred Ngaro has been hung out to dry by his own political party.

No senior member has been placed next to a new Minister to support him in a situation where Mr Ngaro has, unfortunately, a character flaw: he is too honest. Mr Ngaro should be given a vote of thanks by all members of this Parliament and by the people of New Zealand for telling the truth. Mr Ngaro has sat for 6 years in a caucus where there is this behaviour of threatening NGOs; of suggesting that people should not criticise the Government, or “Watch out.”; of suggesting that if people want contracts with this Government, there will be clauses that say you will be gagged. Mr Ngaro saw this on a daily basis for 6 years, and all he did was articulate it, because he is an honest man. But where are his colleagues now? Where are his colleagues now?

Only a few months ago he was one of the “Three Amigos”; now he is on his own. Let us just go through some of the things that Mr Ngaro has already seen. For example, health Minister, Mr Coleman, decided that if you criticised his health policy, you were “a raving leftie”. Conservation Minister Barry calls people who badmouth the Department of Conservation underfunding “nutters”. A contractor who has drilled holes at Pike River has had a gagging order placed inside his contract so that if anybody contacts him with regard to what he is doing on site, particularly the media, he must alert Solid Energy.

The Rt Hon Winston Peters and fellow MPs of mine went to Kaikōura 14 days ago because they had been contacted as elected members of this Parliament by constituents who were concerned about the slowness with regard to the reconstruction there. The New Zealand Transport Agency (NZTA) then calls up the helicopter company and wants to know who hired the helicopter. What on earth makes NZTA think it has the right to ring up a commercial operation, which has been hired by a private organisation, and ask who paid the bill? It believes it can because that is the sort of practice that this Government allows to happen.

It goes on, though. Last week New Zealand First emailed St John Ambulance to ask about the new crewing proposals that this Government had announced. St John Ambulance came back in an email and said: “What do you want to know for?”. Well, actually, we want to know because we want to know. The Government has announced it, so we are just looking for the finer detail of it. But when it replied to us, it cc’d in the Ministry of Health. It cc’d in the Ministry of Health—

Hon Louise Upston: They’re the ones that are paying for it.

TRACEY MARTIN: I find it very interesting. The Minister obviously agrees that it is normal practice for this Government, because she is ranting on about it. It is like social providers. Social housing providers have been told that if they get approached by the media, they need to contact the ministry immediately. They are not free to speak—they are not free to speak.

In Northland, 2 years ago, Whangarei MP Shane Reti phoned up a resident and told her: “You’d better stop complaining about your dusty road or nothing will happen.” Unfortunately for him—unfortunately for him—she actually recorded the phone call.

What about the solo mothers who, with Paula Bennett, once they criticised her policy, ended up with their private data all over the internet? What about when the human rights commissioner criticised John Key about increasing spy powers and he threatened to cut their funding? What about Salisbury School when Hekia Parata lost her court case and since then she has been starving it to death? Mr Ngaro merely did what he was taught to do. Mr Ngaro merely articulated what he has seen being done. Mr Ngaro should be supported by his colleagues. It is a shame. It is a shame that you do not stand by your colleagues. But let it be a lesson to all of you backbenchers: make one mistake and your party leaves you alone.

Hon MAGGIE BARRY (Minister of Conservation): Moving aside now from the hysterical, shrill nonsense peddled by “Winston First” and his motley crew, we need to address some of the substance that occurs across this Government. Budget 2017 has already delivered the Department of Conservation (DOC) its biggest pay day in its 30-year history. This has been a remarkable year for the Department of Conservation. More conservation work is being done in this country now than at any other time in our history and DOC is spending more than ever before on natural history and on recreational work. Predator Free 2050 is gathering momentum. It is about to announce its new chief executive. There is going to be at least one, if not three, landscape-scale predator announcements that will be a game-changer for regional New Zealand within the next few months. These are very important—immeasurably important, actually—gains for New Zealand’s threatened and vulnerable species.

In the past 2 weeks I have announced a $76 million package that will not only allow DOC to provide a much better experience for visitors but also return much more revenue to DOC, which will be reinvested in species protection and biodiversity. One of the initiatives that we will be spending some of that money on is a new computer system, which means that DOC will be able to differentially charge. This means that international visitors to New Zealand will be paying more for staying on our Great Walks and a number of other facilities that the Department of Conservation has control over, and that will return excellent revenue to the department. New Zealanders who pay their rates and their taxes have already made a considerable investment in the Department of Conservation so they will be given a discounted rate. These are all mechanisms that we have put in place to enable predator control and threatened species management to continue at a great level.

Big business and philanthropists and other partners have also joined forces with DOC to the tune of $100 million in the past 6 years. If we listened to Labour and the Greens—which, of course, we never do; but if we did, if we were foolish enough to do that—then we would be spurning that $100 million because it would somehow be portrayed as being tainted. That is a very, very flawed approach to conservation. So we have, coming up, two more Great Walks and a new network of day walks and short walks.

I have also announced a $21 million funding increase to launch Battle for our Birds, which will be the biggest predator control operation in our history. When you kill the rats and the stoats and the possums and the other mammals that predate on our vulnerable species, you protect their habitats, you protect our biodiversity, and it is entirely significant that all of the landscape control that we have done really addresses that balance of the invaders that kill some 25 million native birds each year. So that $21 million will be well spent. We will continue to use intensive trapping programmes and aerial 1080 operations.

We have also unveiled in the last 2 weeks New Zealand’s Threatened Species Strategy. This is the first time in New Zealand’s history that we have ever pulled together all of our threatened species in one document. It is a discussion document, and I would urge all interested parties to contribute to that by the cut-off date of 31 July. This is an effort to ensure that all of the predator control that is going on in New Zealand should be focused on the species and on the habitats that really need the assistance, so this strategy has been very welcome and has landed well. Two weeks ago I announced a $2.8 million injection into the sea lion threat management, so we are concentrating on our taonga species.

A lot has been happening in other parts of my portfolios as well. Two weeks ago, along with the Hon Simon Bridges, we made a very significant announcement that is going to continue to increase the capacity of our film sector to do a terrific job to attract revenue to New Zealand, to attract big films to be made here, and to make sure that our domestic film-making environment, the people who work on the craft end—the film, the camera, and so forth—will have a true profession. So the $306 million to support the New Zealand screen industry, both globally and domestically, will make a huge difference. The $65.94 million remains available to ensure the domestic component of the grant continues. So since 2014, when the grant came in, it has supported around 50 international productions and has also supported 23 New Zealand productions like Pork Pie, Chasing Great, and so forth.

In terms of the pre-Budget announcements, it would be remiss of me as the Minister for Seniors not to mention the $2 billion pay equity settlement. That is a game-changer for our rest home and community carers and is evidence about how much this Government can and will make long-lasting and noticeable improvements for all New Zealanders, including our vulnerable seniors. Thank you.

JACINDA ARDERN (Deputy Leader—Labour): After 9 long years of a National-led Government, it is our view that there should be one word that people should be looking for in this Budget, in all of the Budget announcements, and that word is “solutions”. I think people will be tired, as we are, I am sure, of the constant blame game that you hear from this Government any time you raise a significant issue that needs to be addressed, but if there is one thing that you run out of after 9 years of being in Government, it is excuses—it is absolutely excuses. It is time—and we should be seeking it in this Budget—that we see the solutions to the major challenges that we are confronting here in New Zealand, and they are undeniable.

If you are looking for one of them, then you need look no further than the challenges that we obviously have when it comes to the most fundamental of provisions, and that is shelter—a roof over your head—because housing affects everything. It affects the quality of your health and your children’s health. It affects your ability to put food on the table. It affects your stability to keep your kids in education and enrolled at their local school. It affects the stress and tension that your family experiences. It affects everything.

That is why it has been such a focus for us, and yet what did we see in the House today, when we again raised the need for solutions in this area? We had a Prime Minister who could not decide whether he wanted to blame councils, the media, Aucklanders, or the Salvation Army for the issues that we are facing—all of which is inexcusable when you have been in Government for 9 years.

No one has said it would be easy. No one, not even on this side of the House, has ever claimed that resolving the housing crisis would be easy, but we have said that it is an imperative. We have offered up time and time again our new ideas, our fresh look at this problem—ideas like closing tax loopholes, banning foreign overseas speculators from being able to buy in our domestic residential market, moving the brightline test, and fundamentally getting on with the act of building houses at scale, which is something that we have promised to do. That is what a solutions-focused Government would have done.

But that is not the only area we need to look for solutions in in this Budget. I have a major expectation that this Government is going to do something to reduce inequality and the child poverty that we see in this country. I have looked for that in every single Budget. In fact, in one Budget, in 2011, we actually had a Government that stood up and placed cuts on Working for Families that amounted to $448 million. It said that was to pay down debt, and what did we see instead? An increase in Crown debt. What do we hear now? Rhetoric about this next Budget that those members are finally going to do something around fixing Working for Families after they have, time and time again, adjusted abatements and cut and cut and cut away at that provision. It will be insufficient just to reverse some of the damage that has already been done, so I will be looking for real solutions that ease the pressure on families.

I heard Steven Joyce today, though, say that when you look at a Budget, you should not look just at inputs; you should look at outputs—you should not just look at inputs; you should look at outputs.

Chris Hipkins: What about kids?

JACINDA ARDERN: You know, well, actually, if by “outputs” he means people, then, yes, I am really interested in what we are doing for people. I am interested in what we are doing for kids. I am interested in what we are doing about people’s wages. We have a low-wage economy. We need people’s wages to increase. We need investment in the early years—those fundamental years—of a child’s brain development. If that is what Steven Joyce means by “outputs”, then I am going to be looking at that, too, but I might put a human face to it.

But, finally, I will also be looking for solutions in the health budget. We have had $1.7 billion cut over time from health. When you have one out of every six New Zealanders suffering in their lifetime from a mental health - related issue, mental health is an area where we need sufficient investment, and there has been under-investment. Labour has fresh ideas and new solutions in this area. We have talked about primary mental health care. We have talked about comprehensive health in our secondary schools. These are ideas that we want to see, and those are solutions I will be looking for in this Budget. But, actually, what I think we need instead is just a change of Government.

Hon LOUISE UPSTON (Minister of Corrections): I have got great news for the speaker who has just resumed her seat, Jacinda Ardern, because there are loads of solutions that this Government has in place in terms of an area that is very important for Kiwis, and that is safer communities. New Zealand is, of course, the fourth-safest country in the world, but, no, our Government is not satisfied with that; we are aiming to be No. 1, and I want to talk about some of the solutions that our Government has put in place and the results that we are getting.

We believe very clearly that when offenders are in our custody, we should absolutely do our utmost to put them on a different path in life. We owe it to their families, we owe it to their communities, we owe it to taxpayers, and we owe it to their victims. Yesterday the Minister of Police and I announced a number of measures that are focused very much on one of the most significant drivers of crime. Fifty percent of all crime is committed by people under the influence of alcohol or drugs. This is a very targeted solution. It is very specific around looking at those who are out on bail, or offenders who have abstinence conditions, and making sure that by close monitoring and by more significant testing, we are able to identify early exactly what is going on. About 50 of the highest-risk offenders will be fitted with these alcohol detection anklets, which will detect alcohol in their sweat.

It provides a couple of things. Obviously, there is the compliance issue—we want to know that offenders who have conditions and are managed in the community are complying with the conditions that have been imposed by the Parole Board. More importantly, we actually want offenders to be successful in creating that new path in life, and that is the point that the Opposition members have clearly not got their heads around. In terms of rehabilitation, in terms of reintegration, this Government has spent $176 million in the last year alone on rehabilitation and reintegration. That is 13 percent of the Corrections budget.

But what is important is that we on this side of the House do not talk about how much money we are spending, because we focus very clearly on the results. I am going to talk to you about the results. The Minister of Finance clearly talks about outputs—outputs are results. We measure them through the Better Public Services targets. We change the targets when we reach them. We set new targets so that the taxpayers of New Zealand can absolutely see the outputs that we are achieving.

Yes, in terms of inputs, funding is part of that, but what is more important for New Zealanders—for hard-working New Zealanders—is what this Government is doing in terms of solving the very issues that have an impact on their lives, and we are tackling the hard ones. The previous Government was quite happy to leave prisoners inside with very few programmes in terms of supporting their drug and alcohol issues. One example alone: in our term in office, we have delivered drug and alcohol programmes and treatment to 22,000 offenders in the community and 6,500 prisoners. That is up from 230—230.

When we talk about solutions, we are talking about solutions for real problems for real Kiwis—some of the most challenged ones, absolutely, whom we are making a difference for. On this side of the House, we come up with solutions, whether it is getting prisoners qualifications—the big one at the moment is getting offenders into jobs, because we know that jobs provide them with stability and jobs provide them with an income. At the employer breakfasts that I have been hosting around the country, we have employers lining up to take on more offenders, because they know that they are drug- and alcohol-free, that they have got access to literacy and numeracy, that they got qualifications while they were inside, and that they are hungry for the opportunity to prove that they are set on a new path in life.

Over the last 4 years, under the Better Public Services targets, there have been 38,000 fewer victims—38,000 fewer victims. If that is not a result that Kiwis are interested in, I do not know what is. Thirty-eight thousand—that is the figure I am proud of.

CHRIS HIPKINS (Labour—Rimutaka): This is a National Government that has given up on the big challenges facing New Zealanders. After 9 years in Government, those members are just too tired. They have given up. They shriek, they yell, they patronise, and they bully, but they have given up on the big issues that confront New Zealanders. For all of the facts and figures that they are giving up, they have lost sight of the fact that they are here to govern for people—for people.

Here is a number that I am going to give to the Government today: 702. That is the number of schools in New Zealand that are either already overcrowded or are at risk of becoming overcrowded within the next year or two, because this Government has not kept up with population growth. It has been happy to take the extra tax revenue that comes from population growth, but when it comes to investing in the services that that increasing population needs, it has done nothing. It has not been willing to invest that money. As of today, by the Government’s own definition, there are 214 schools that are overcrowded. That means we have got kids having their classes transferred to libraries, halls, gymnasiums, and even old dental clinics because they have not got the classrooms that they need to keep up with that growth. There are another 488 schools that are at serious risk of becoming overcrowded in the near future.

The Government is now frantically playing catch-up. Yet we know that of the hundreds of millions of dollars that it has announced in terms of spending in the last 3 or 4 years, only a fraction of that has actually been spent, because the Government is constantly trying to catch up and it is not doing a very good job of it. That is why parents know that the learning conditions that their kids are facing simply are not good enough. Parents in early childhood education know just how much the Government has run down the early childhood education sector, because although participation is up—and that is a great thing—the funding on a per-child basis has gone backwards, not only in real terms, but in nominal terms as well.

Early childhood services are not getting the money they need to deliver quality education for kids. So if they were to catch up for the 9 years of National Government, they would be looking at hundreds of millions of dollars, if not a billion dollars or more, of back-funding to make up for the fact that the Government has not increased early childhood education funding, to keep up with the growing population and increasing costs. As for schools, the Government froze school operations grants last year, which meant that increasing salaries for school support staff had to be absorbed by cutting things somewhere else or by cutting the school support staff themselves, and that is not good enough. The Government, of course, has frozen student support for tertiary students for years and, in fact, in many cases, it has reduced the level of support available.

This generation of students leaving tertiary education now will be the most indebted ever in New Zealand’s history, and that is not good enough. And even within the debt, the Government is not willing to acknowledge the increase in cost. The amount that students can borrow for their living costs has not changed, I think, in the entire time the National Party has been in Government, and the result of that is now people cannot even borrow enough money to pay the rent on their flats let alone eat, and that is the track record of the current National Government. But it is not just education; we have seen woeful neglect in mental health and we are suffering the consequences as a society for that, and the Government has got nothing to say on that. It has simply given up.

When it comes to the challenge of homeownership, the Government has a lot of smoke and mirrors, it has got a lot of puffery, but it is not actually delivering results. Homeownership rates are the lowest—the lowest—that they have been in several generations. That is a whole generation of New Zealanders now completely shut out of the housing market. Something like 85 percent of the people who are renting today will never save enough for a deposit to buy their own home. That is the legacy of this National Government. It has robbed from the future by refusing to pay into the Superannuation Fund, kicking the can down the road and saying that the future retirement of New Zealanders is something for a future Government to worry about. This Government has completely washed its hands of it.

And while we are talking about washing things, one thing it has not washed, or has not cleaned up, is our rivers. It is quite happy to admit that New Zealand rivers are unswimmable. The birthright of New Zealanders to go down to their local swimming hole for a swim in the summer has been taken away increasingly in recent years, and this Government does not care about that. It seems to think that is good enough. I do not think that is good enough. I think it is time we have a Government that focused on the future. Remember the brighter future the National Party promised? It never arrived for New Zealanders. I think it is time we had a Government that is genuinely aspirational for New Zealanders, and that is what New Zealanders will get if they vote for a change of Government and vote for a Labour Government in September this year.

Hon NICKY WAGNER (Minister supporting Greater Christchurch Regeneration): I would like to take this opportunity to update the House on the regeneration of Canterbury, because it is a really bright future for our province and our city. We have made real progress, and it illustrates how important active support and resource from Government is in times of disaster. This is a $40 billion recovery and this is important for not just the people of Christchurch and Canterbury but the people of the South Island and New Zealand.

After the earthquakes there were numerous doomsday predictions, many from that side of the House. They said: “Everybody’s going to leave Christchurch. The city’s going to stagnate economically, and the well-being of Cantabrians will be dire.” And that is right, it has been a very long, hard road, but we have got there. There are challenges in front of us. But recent data—and it is important to have good data—is showing that Canterbury is well and truly on its own two feet.

We were told that people would leave Canterbury in droves. And there was an immediate exodus, but between 2010 and 2016 the population of Canterbury has increased by 5.7 percent; about 32,000 people have come to our area to enjoy our greater, brighter future.

We were told that businesses would close and jobs would be lost, but the number of businesses has increased and hundreds of jobs have been created in the last 6 years. We have got down to a level of just over 2 percent unemployment, and even today the unemployment rate is at 4 percent, compared with a national average of 4.9 percent. Our economy has grown. It has grown above the national average. It has grown 13.7 percent since the earthquakes. The average wages have increased. Before the earthquakes in 2010 the average wage was $726 a week; it is now $935 a week. Lots of young people have had an opportunity to be trained and get into jobs of their choice.

We were told there would be nowhere for people to live—and that was tough immediately after the earthquake—but we have built thousands of new houses and thousands have been repaired. We have managed to open up land and to build houses of good quality quickly. What that has meant is that Christchurch now has very good quality and well-priced houses. The average price for a house in Christchurch is $496,000, and the average weekly rental price is going down. It has dropped for the last 2 years, and it is now $386 a week.

We were also really concerned about the well-being of Christchurch people, but the Canterbury community has really come together. We have supported each other street by street, and we have also managed to develop the Community in Mind Strategy, which has brought all the service providers together and they have done a really good job.

The latest survey tells us that 82 percent of Canterbury families believe that their quality of life is good or very good. These figures are important, because they are showing that we are making really good progress, and, on the whole, Greater Canterbury is regenerating and it is a great place to live, work, and play. Having good data allows us to find the solutions—the solutions that seem to be so elusive to the Opposition—for the issues that affect us most. The negative predictions about Canterbury have not come true. Christchurch is a real city of opportunity. Young people are flocking here. New businesses are opening every day. One of my priorities as a new Minister is to continue to drive these positive trends and to support the well-being of Cantabrians by continuing to progress this regeneration as quickly and as efficiently as possible.

The overall picture is big and complex, and I am releasing regular snapshots of information so everybody will be able to see what is happening in our city. It will be accurate. It will be transparent, and we will all be able to track the regeneration process. I want to ensure that Christchurch is a great city in a great province. It is the gateway to the South Island. It is important to the South Island people and all New Zealanders. Kia ora.

METIRIA TUREI (Co-Leader—Green): Parenting is the most important job in the world. It is the most important job in the world. As a mother who has raised a child to adulthood, I can tell you that, for me, it is the most rewarding job I have ever done. But some days it felt like the hardest job, especially in those times when I just did not have enough money to stretch. I had to choose between food and rent or food and power. There was just not enough to go around. Anyone who has been in that position, and there are thousands—thousands of parents, mothers and fathers—who have been in that position, knows the stress of worrying about how they are going to make ends meet, worrying about whether they can afford to feed their kids that week. We all know that that stress is immense for those families. So I was very pleased earlier this week to announce the “Budget for all mothers” as part of our plan to make sure—

Hon Member: The “mother of all Budgets”.

METIRIA TUREI: —the “Budget for all mothers”—to make sure that families do have enough of what they need to do a great job of being parents to their kids. All families need is a little bit more time and a little bit more money. The Greens’ “Budget for all mothers” delivers both to all families in this country, and we are very proud of that.

To make sure that all babies have the support and the care that they need when they are born, we will make sure that anyone who is not entitled to paid parental leave—and many are—will have access to the parental tax credit of $220 a week for the first 10 weeks after they bring their baby home. And the people who miss out at the moment are people who are on benefits—they may be working, but they are on benefits—people who are students, and people who are on ACC. The people who miss out now are the ones who have the least money at the time when they need it the most. The Green Party is going to fix that.

We are going to make sure that newborn babies and their parents have access to a wahakura, baby pod—every single one of them. Not all of them will take it up, but every single family will have access to a wahakura or a baby pod, a safe sleeping device with the things that the baby needs for the first 3 months of their life. We know that these safe sleeping devices will save babies’ lives. We know that communities who are weaving the wahakura and producing the baby pods want to contribute to the well-being of all newborn babies in this country, and that this is a way that they can do that, to show how much we as a society value every baby who is born in this country.

Every parent I know has to struggle to balance their work commitments with taking care of their children, so we will make sure that every worker gets a minimum of 10 days’ sick leave that they can use both for themselves when they are sick and also for domestic leave when they need to take care of their children when their children are sick. I will tell you, we talked to a lot of families about this policy before we announced it, just to check that it made sense, and this provision of making more sick leave available to those families was the one where they just went: “Oh my God, yes please. That would make such a difference.” They need that time to make sure that they can get their kids to a doctor if they need to, or so that they can stay home and take care of their children when their children are sick so that those children get well and can continue on with their education.

We know that families need a little bit more time and a little bit more money to be able to do the great job that they want to do. This is what social investment actually looks like—helping families at the time that they need the most help, so that they are never driven into abject poverty, like National’s “mother of all Budgets” did in the 1990s. The Greens’ “Budget for all mothers” will help to make sure that not a single family in this country is driven into poverty, and that is what voters get to choose in September of this year, when they get change the Government from one that will drive families into poverty to one that will make sure families never have to suffer it. Thank you.

KANWALJIT SINGH BAKSHI (National): Thank you for the opportunity to speak and participate in this general debate, Mr Speaker. First of all, I would like to start my contribution by paying tribute to those affected by yesterday’s bombing in Manchester: 22 victims who went to the event to enjoy it, but never came back home. That shows we are living in a very vulnerable situation, and I would like to pay tribute to our police and intelligence people and New Zealand’s defence forces, who make sure that we live in a very secure atmosphere in New Zealand.

On this note, I would also like to acknowledge the work done by the employees of Corrections, who are ensuring that the inmates who are there get the right opportunities to ensure that they get proper training and also get the opportunity to help themselves be extricated from alcohol and drug situations. That is because, as the Minister of Corrections, the Hon Louise Upston, mentioned, employers are looking for such employees, who are drug-free and alcohol-free, and can work. These inmates have got opportunities to prove themselves—to prove that they can work when they complete their sentences.

I am looking forward to tomorrow, when the Hon Steven Joyce will deliver his first Budget. That will be the ninth Budget by the National-led Government. These Budgets have been working for the brighter future of New Zealand: improving public services, investing in infrastructure for the needs of our growing economy, and sharing the benefits of the economy by working to reduce debt, to shore up our resilience to any further shocks. As the Hon Nicky Wagner mentioned, the earthquakes in Christchurch and Kaikōura and the recent floods in Edgecumbe show that we are at the mercy of mother Nature. Any incident can happen at any time, so we have to be prepared to face such situations.

One of the speakers from the Labour side said he cannot see what the Government is doing, but I can tell him that I have been visiting a number of workplaces, as well as construction sites, and I have been told that right now in Auckland we have got more than 60 tower cranes working in the construction industry. In comparison, in New York there are only 45, and there are 34 in London. That shows that the construction industry is at full boom in Auckland, and the highest investment is going into that area. It is not only that the Government is building infrastructure; houses are being built. Commercial establishments are being built. That shows the economy is doing very well.

I was also told that if you miss out on concrete delivery in Wellington, you have to wait for 1 week to get the next appointment. Similarly, if you miss out in Auckland, you have to wait for 3 weeks before you can get concrete for your construction site. These are the things that are really showing that this Government is working to ensure we have got infrastructure.

Chris Hipkins mentioned that schools are overcrowded. I can tell him that recently I went to the opening of Koru School in Māngere, which was rebuilt with a new facility. The kids in the school are so happy to see the new facility that they are very enthusiastic for when they are going to enter those classes. We have invested millions of dollars in Auckland alone to ensure that we have got facilities so that the kids, our future, can have the best education in days to come.

If we talk about the law and order and justice sector, the Government has announced that we will be spending more than half a billion dollars in the next 4 years, which will enhance the safety of people in their homes and in the community. We are making sure that all these things happen, and that will be under the strong leadership of the Rt Hon Bill English and his team. Tomorrow’s Budget will show that again. Thank you.

STUART NASH (Labour—Napier): We have heard some fine words from that member, Kanwaljit Singh Bakshi, and the Minister of Corrections, but what I would like to do is sort of put it in perspective. The way I will do that is by just putting the facts out there, because what I think we have got on 23 September is quite a big choice in society: whether we want a benevolent and compassionate society with solutions and ideas and innovative ways to move forward, or a divisive and rather punitive Government, which we have here, when it comes to the treating of the most vulnerable.

Let me give you a couple of statistics, if I may. It was the chief executive officer (CEO) of Corrections who told us this at the Law and Order Committee: 20,000 New Zealanders every year enter a jail—20,000 Kiwis. Of those, 14,000 are there for 6 months or longer. What he also told us was that 62 percent of prisoners who walk through a prison door—walk through the jail gate—have a mental health or addiction issue. What he also told us was that Corrections tests only 7,000 a year. So it tests only 35 percent of all prisoners who walk through the gates, and yet there are 8,680 who are there for 6 months or longer.

I said to the CEO, the man in charge of the operations of Corrections: “Mr Smith, are you at least putting in place—is Corrections at least putting in place—the programmes and processes to give these prisoners a chance to at least be productive citizens when they come out of jail?”. Do you know what he said? He said: “I don’t think we’re that ambitious.” He said: “I don’t think we’re that ambitious.” This is an admission that what we are doing with 20,000 New Zealanders a year is locking them up, leaving them in there—often, they come out a little bit angrier, a little bit madder, or a little bit badder, and we wonder why we have got recidivism rates going through the roof.

Then we hear from the Minister that we have got 16 new alcohol counsellors in prisons. Now, that is good news, but it is only a start—16 new counsellors, to cope with 8,680 prisoners with a mental health and/or addiction problem. It is not even scratching the surface. What this Government has announced is over a billion dollars on a new prison. Between 2005 and 2015 the Corrections budget has gone from $526 million a year to nearly $1.5 billion a year. That is a billion-dollar-a-year increase over 10 years on Corrections. The question that I would like to ask is: do we want to live in a society that actually locks people up and throws away the key, or do we want to live in a society where we at least deal with the issues that are facing our communities?

I think that if we had spent the billion dollars we are about to spend on a jail, and the extra billion dollars a year we are paying to Corrections—if we spend that money on education, on mental health and our health services, on community policing, and on housing, we would not need the prisons. We would not need these prisons, because we would be dealing with those who are most vulnerable in our communities before they get to prison. That is why I say that a Labour-led Government actually has solutions apart from “let’s lock ’em up and throw away the key.” Spending another $1.3 billion on a jail when we should be spending $1.3 billion on houses, on mental health, on police, on education—that is what I think New Zealanders want for a Government.

We had the Minister of Corrections also say that victimisations had dropped. I do not know where she got that statistic from, because in the last full year, between 2015 and 2016, victimisations had increased by—the exact figure—11,568. That is how much they had increased by. Assaults were up by 3,308, sexual assaults were up by 214, robberies were up by 18 percent, and there are burglaries up to $75,000 a year. Let me talk about meth, and I quote the Police: “New Zealand’s vulnerability as a destination for methamphetamine shipments appears to be increasing.”, “The number of children found in clandestine labs or assessments has increased each year since 2012”. But, worse: “Despite the increase in seizures, therefore the removal of methamphetamine from the market, there appears to be no visible impact on the availability of methamphetamine.” Unless we start investing in the processes and the resources to drive this out of our communities, it is going to remain. We need a benevolent Government, a compassionate Government; not a punitive one.

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

ANDREW BAYLY (National—Hunua): What exciting times we live in. We have got a country that is growing at 3 percent, and do you know what, the Reserve Bank projected that it is going to continue to grow at 3 percent for each of the next 4 years. We have got 130,000 jobs created last year. Again, Treasury projects that we are going to have 150,000 new jobs coming on stream over the next few years. We have got low inflation, we have got real wage growth—2.1 percent last year—and we have got a much more diversified economy. It is nice, and you have all heard us talking about the growth in the tourism sector, the ICT sector, wine—they just keep going on, and that is the good thing about the New Zealand economy and the hard-working business people and their employees. And we have got another large surplus, building on that $1.8 billion surplus last year.

So what does this all mean? Well, what it means for everyone is increased job security—well, for most; except for us here in Parliament. Second, there are more opportunities for graduates coming out of our tertiary institutes and, also, for the 50,000 people going through the apprenticeship schemes in New Zealand. There is more money in the pockets of families, and there is more available for spending on things like policing, infrastructure, health, and education.

Brett Hudson: Great country.

ANDREW BAYLY: That is what makes it a great country, as I have just heard from my colleague here. That is why people want to come and live here. That is why New Zealanders want to return to this country.

Now, today I want to focus on just a couple of areas. First of all: policing. I want to go back to that great announcement that the Hon Paula Bennett made: $503 million to be spent over the next 4 years to get 880 new sworn officers in place, plus an additional 245 people who will focus on solving crime, like forensic scientists—the right sorts of people who are going to help reduce our crime rate even more.

Secondly: infrastructure. We just heard the recent announcement of $11 billion more on infrastructure. Can I ask, do you know what we expect now to spend over the next 4 years? It is $23 billion worth of new infrastructure spend—$23 billion—roughly about $5 billion a year. And what is that going to be spent on? Roads, rail, hospitals, schools—the list goes on. Just in my electorate, I am really happy that we are going to see the completion of the triple-lane motorway down to Papakura and the start of the rail electrification from Papakura to Pukekohe. We are going to see safety improvements on State Highway 22 between Drury and Pukekohe. These are examples of where things are happening, and I am hoping for more. I have got new schools. Ormiston Junior College just opened at the beginning of this year. We have doubled the expansion round Ormiston Primary School, and virtually every school I have been through in my electorate—and I have got 38 of them—has had some upgrade to some extent, whether it is a new classroom or whatever.

Now: health. Dr Coleman made that recent announcement of the extra $59 million to go into the ambulance services, and I think that is a great thing. It is about the double-crewing of our ambulances as they do their great work. Only just on Monday night, I was meeting my Franklin team—I know they do a great job—and they said to me that that announcement is fantastic because in places like Waiuku they will now be having the ambulances that are based there double-crewed with professional staff. I think that is great.

Conservation: as I asked that indefatigable Minister, Hon Maggie Barry, earlier in question time—and she is sitting right in front of me—what an outstanding achievement, in terms of getting that extra $76 million to build on the Department of Conservation’s tourism and also the Great Walks. I think those are great things. That is what tourists come to New Zealand for, and here is some real money going into it. I cannot believe that she continues to get so much money for conservation—all the money that is going to go into the Battle for our Birds and the War on Weeds; all those sorts of things. I am lucky enough to have the kōkako in my Hunua Ranges. They are great, and these are the types of things that support them.

Last of all, the really exciting thing is that we have got even more to come tomorrow with the Budget, and I am really looking forward to it.

Hon PETER DUNNE (Leader—United Future): I want to say a word or two today about tolerance, a rapidly declining commodity in today’s world. But, before I begin, can I pay my tribute to those who lost family, loved ones, and friends in the horrific attack in Manchester yesterday. I hope that the British authorities are able to bring to justice those responsible quickly and swiftly before there can be further attacks. Inevitably, in a situation like this, there is a period of recriminations. That is where the issue of tolerance for diversity becomes important. This is an unacceptable act by unacceptable people—do not damn a whole race or a whole creed on the basis of the activities of a few.

We have overtones of that same extremism occurring in New Zealand when it comes to the debate about immigration. If you believe some people, immigration in New Zealand is depriving New Zealanders of jobs, preventing them from buying houses, tearing up our way of life, and destroying all that is good in this country. In fact, immigration is adding to our diversity, adding to our richness, and creating opportunities that we never had before. According to the Reserve Bank, New Zealand is going through one of the longest growth periods of the last 50 years. We are seeing employment growing 2 to 2.5 percent per annum, unemployment is falling, and house prices, after their huge surge, are stabilising and falling quite sharply—and in Auckland more sharply than anywhere else. So for all those who want to play the immigration or the race card for political advantage and cite those dire facts that they do, they are doing the Trumpist work of false news, of alternative information, etc.

This country was built on immigration. This country prides itself on its diversity. The fact is that we do accommodate a mix of cultures and a mix of people, and, as a consequence, become stronger as the people who live in these particular islands. It takes events like those in Britain to remind us of the dangers that we face in today’s environment, but also to warn us against overreaction, stigmatisation, and extremism as the reply to those horrific activities.

What underpins all of this debate in New Zealand—the bile, the prejudice, and the bigotry we see uttered by some—is that it is not about the facts, it is about what they see as short-term advantages, milking fear for political purpose. It is unacceptable in this country, and, when New Zealanders have a chance later this year to express their preferences, I strongly urge them to deny the bigots, the racists, and the peddlers of false truths the representation that they seek. They will tear this country apart. You cannot set person against person, culture against culture, and ethnicity against ethnicity and expect to have a strong and vibrant nation as a result.

We will grow as a consequence of the migration that has occurred over the last years—the influx of skills, the demand that those skills have created, and the fact that our children and our children’s children are going to become a much more cosmopolitan mix of cultures—which will mean New Zealanders will be able to play an even greater part in the world than they do today. Putting up the wall around our borders and trying to stigmatise those who are different as the cause of our problems are remarkably short-sighted, vindictive, and vile acts, and I do not think that a tolerant society should have any truck with the extremism, the bigotry, the intolerance, and the ignorance that lie behind those sorts of sentiments. They are unacceptable in this country, and I believe very strongly that New Zealanders ought to reject these absolutely negative, critical, irresponsible bigots there are amongst us.

ALASTAIR SCOTT (National—Wairarapa): Following on from Mr Dunne’s contribution, and endorsing every word the man says, I would like to—you are going to hear me saying a few repetitive words: “excessive and expensive”. I am going to say that a couple of times, and I am also going to use the word “credibility” a number of times through the next few minutes.

Excessive and expensive are descriptive words of the Opposition’s policies. It should, whenever it recommends a policy, run it past an “excessive expensive” test. Mr Robertson suggested to us this afternoon that there is plenty of Labour Party policy. But he has not run it past the “excessive” and the “expensive” test. If he had done so, he would find that he would reject half of the policies. It would help that side of the House gain credibility—something that we have on this side. We have oodles of credibility because our policies are practical, reasonable, and affordable, in contrast to the excessive and expensive policies of the Opposition. And it wonders why it polls at 20 percent. It is because of the excessive and expensive policies.

I am just going to give a couple of examples. Reflecting on Mr Dunne’s contribution just earlier, let us talk about immigration: the immigration policy enunciated by Mr Little just a few weeks ago, saying on Duncan Garner’s show that he wanted to cut immigration by 50,000 people—50,000 people. It was all there in colour, black and white—50,000 people. That is just an excessive and expensive policy, shooting from the hip. Excessive—how, really, is Mr Little going to do that? Is he going to put up a wall to stop Kiwis coming home? Is he going to kill off the international student market, which is a multibillion-dollar industry? Is he going to stop students coming in from various countries on a working visa, filling gaps in our peak tourism seasons? We, of course, have a reciprocal relationship with other countries—is he going to stop that from happening? Is he going to stop IT workers, engineers, or project managers from coming into New Zealand? They are the people whom we need to fill the gap to ensure that our economy continues to grow and continues to have opportunities for New Zealanders.

So what is the answer? I tell you what; he has been listening to Mr Twyford. He is going to stop people with Chinese-sounding names from coming into New Zealand because he has got to do something to get 50,000 fewer people into New Zealand—an excessive and an expensive policy. I do not know how the other members of the Opposition let him get away with it, because it does not make sense.

I am going to talk very quickly around a housing policy. These guys are going to build 100,000 houses, apparently—100,000 houses. Contrast that with the practical, reasonable, and affordable policy enunciated by Minister Adams just a few days ago, where 8,000 existing properties owned by Housing New Zealand will be turned into 34,000 houses. Mr Twyford wants to build 100,000. That is excessive and expensive. That is a $50 billion project. Remembering that Mr Twyford hates speculators and property investors—he keeps talking about them and talking about what a poor job they do and what rip-off merchants they are, yet he wants to be the largest one. He wants to be the largest property investor and the largest speculator in the country, because he is going to have to go to the private sector to buy the land that he needs to build his 100,000 houses. The effect of that will be higher prices in Auckland and across the country for properties—counter-productive, excessive, and expensive.

I want to talk very quickly around the free tertiary education policy enunciated by the Labour Party—again. That would mean that my parents could line up and get a free tertiary education on, I do not know, the history of tiddlywinks, funded by the taxpayer—excessive and expensive on that side; practical, reasonable, and affordable on this.

The ASSISTANT SPEAKER (Lindsay Tisch): Sorry, the member’s time has expired.

The debate having concluded, the motion lapsed.

Bills

Trade (Anti-dumping and Countervailing Duties) Amendment Bill

Third Reading

Hon JACQUI DEAN (Minister of Commerce and Consumer Affairs): I move, That the Trade (Anti-dumping and Countervailing Duties) Amendment Bill be now read a third time. I acknowledge the work of the Committee of the whole House yesterday, and commend it for progressing the bill to this stage and for adopting Supplementary Order Paper 289. I thank the members of the Commerce Committee, who have worked so hard, and those who have supported this bill.

The bill amends the Dumping and Countervailing Duties Act of 1988. The amendments in this bill will make the trade remedies regime more responsive to New Zealand’s best interests by ensuring that imposing anti-dumping and countervailing duties is in the interest of New Zealand in each case. It also gives the trade remedies regime more flexibility in the cases of natural disasters. This bill is common sense. New Zealand needs a trade remedies regime that considers the wider effects of taking action against dumping and subsidisation, including the effects on those who would be negatively affected by the imposition of duties, while continuing to protect our domestic industry appropriately against unfair practices.

To remind the House, dumping is when a product is exported for a price that is cheaper than it is sold at in its own country. When a complaint is made, the Government investigates whether dumped imports are materially injuring our domestic industries. If they are, duties can be imposed. Countervailing duties are similar duties that are imposed to level the playing field with products that can be imported cheaply because of subsidies by the exporting Government.

This speech gives me a final opportunity to emphasise some key aspects of the bill before the House. The bill does four things. Firstly, it inserts a public interest test into the trade remedies regime. Currently, the Act only allows the Government to consider the effect of a duty on the domestic industry. The Act does not allow the Government to consider the wider public interest before imposing duties. This means that the Government could impose duties even if the costs to New Zealand materially outweigh the benefits. The bill fixes this problem by introducing a public interest test, similar to those in the EU and Canada.

Secondly, the bill gives the Government the power to suspend, defer, terminate, or not impose duties in the case of a natural disaster or emergency. This will ensure that the trade remedies regime is flexible to New Zealand’s unique circumstances and will not become an obstruction to disaster recovery.

Thirdly, the bill extends the suspension of anti-dumping duties on residential building materials for another 2 years. This suspension is part of the Government’s commitment to making the construction of residential housing more affordable by reducing the import costs of building materials. This provision came to be part of the bill during the Committee of the whole House yesterday, through Supplementary Order Paper 289, and I thank the members who contributed.

Finally, the bill makes a number of minor and technical changes to clarify the Act in accordance with World Trade Organization requirements, and restructures the Act to make it easier to understand in a modern context.

I want to emphasise the importance of having a trade remedies regime that works for all New Zealanders. Currently the Government only considers the interests of New Zealand industries, which means that the Government can only consider half of the picture. This bill will allow the Government to also consider the effect on downstream industries and consumers before imposing duties. The public interest test has a presumption in favour of imposing duties. This means the public interest test will only prevent duties from being imposed if the costs to downstream industries and consumers materially outweigh the benefits.

When drafting this bill, the Government has been careful to promote dual objectives—supporting competition and consumer welfare, and maintaining an effective trade remedies regime. Canada and the European Union have both successfully introduced public interest tests in their anti-dumping regimes. Our public interest test takes features from both Canada and the EU, while adapting them to New Zealand’s particular economic, geographic, and commercial context.

I once again thank the Committee of the whole House for its valuable contribution to the development of this bill, and, particularly, the Commerce Committee, led by Melissa Lee. I am confident that the bill will provide a sustainable, responsible trade remedies system that meets the needs of New Zealand industries and consumers, and contributes to the prosperity of all New Zealanders, both now and into the future. I commend the bill to the House.

Dr DAVID CLARK (Labour—Dunedin North): This bill would be laughable if it was not so tragic. This Government aimed, it said, at the beginning of its time, to increase exports as a proportion of the economy to 40 percent. It is now below 30 percent and dropping. The Government has failed to generate an export economy, and here is yet one more measure that undermines our domestic producers.

This solution, if you can call it that, is a solution to a problem that does not exist. This solution is one that Australia has twice looked at and rejected resoundingly. They know it would undermine their domestic producers. They know it would undermine productive industry in the Australian economy. Over there they are willing to ban non-resident foreign speculators from their housing market, and they support their domestic businesses.

Across the House here we see, from the National Government, no such willingness. It backs non-resident foreign speculators in our housing market, and allows them to bid up prices beyond what New Zealanders can afford—to not even live in the houses—and it is today introducing to this House, this Parliament, a measure that will undermine the competitiveness of New Zealand’s domestic producing businesses. There it is, undermining New Zealand’s businesses, and the Minister could not even answer a simple question, or several simple questions, that I put in the Committee stage.

How does this affect upstream suppliers? The bill does not even address that question. The officials who spoke to us at the Commerce Committee acknowledged that it did not address that question. The Minister, it seems, is not even aware that it does not address the issue of upstream suppliers and the effect on their businesses in New Zealand.

This bill proposes that we put aside the normal flat rules that World Trade Organization (WTO) standards would suggest were the logical thing to do to create fair markets across jurisdictions—the kind of thing that New Zealand argues for in international fora: that there should be a level playing field, where there are no massive subsidies for businesses and there is no protectionism across the board. This bill proposes that we put that to one side when it suits us.

So when we go to argue at an international trade forum that New Zealand believes in a level playing field, the rest of the world is going to laugh at us and say: “No, no. You oppose those kinds of things when it suits you—when it suits you. Right here and now you’re saying that you will accept dumped goods from overseas if you think it suits you—if you think they will come into the New Zealand market at a time that you need them to.”

We know that when this has been needed in the past, as with the Christchurch earthquake, the Parliament was willing to sit and put through measures that allowed dumped goods, or ones that had a countervailing duty element to them, into the country. We did that as a Parliament. Why would we want to put that power into one Minister’s hands? Why would we want to put that discretion into one single Minister’s hands, particularly when pressure from foreign Governments could be applied to that Minister to take dumped goods or face challenges when trying to get New Zealand goods into their country?

We know that non-tariff barriers are one of the big issues in contemporary trade internationally, and this makes us more vulnerable as a country to pressure placed on one Minister. This is a much less robust regime. That is without even mentioning how the Government would assess when it was harmful to the domestic industry. How much does this Government know about emerging technologies, about innovative new companies?

This Government has allowed fewer new businesses to form than was happening under the previous Labour Government. New business start-ups have been much slower under this Government, and that is backed up. They sing loud and clear about the fact that this Government is bad for small business in New Zealand.

Here is another example. It is the innovative players that come in that spot goods that seem to be a bit too expensive coming into our market and that come up with innovative solutions and start new companies. Instead, this Government is saying: “No. If we don’t know about you or we haven’t heard about you yet, we’ll allow these goods to come in from overseas and be dumped on the market and that will squash your innovative idea.” That is the effect of this legislation. The Minister has not even addressed that problem in the speech that she made just now.

Of course, there is also the problem of the criteria that are going to be applied. They are subjective. We heard from officials at the select committee that they could not say, because they were subjective—and they used the word “subjective”—how these criteria would be weighted. There are eight criteria put forward by the Government—eight factors that will be considered when assessing whether dumping in the New Zealand market is appropriate.

Here are the factors: a focus on prices; product choice and availability; product and service quality; the financial viability of the domestic industry, not specified how; employment levels, not specified at what level; and competition in the market, not specified at what level. All of these things are not specified at any particular level. There are eight of them, and the priority given to one over the other is also not specified.

This is basically a blank cheque to the Minister to say, at the Minister’s will, that he or she can allow goods to be dumped in the New Zealand market, affecting whatever industry. Possibly if that industry speaks up, it will get worse treatment. That has been the track record of this Government in the last week or so. If anyone opposes what they do, they will knock them on the head and tell them that the Government will not be sympathetic to them. That is what has happened. That is the Ngaro effect. That is what New Zealanders are worried about with this kind of legislation that concentrates power in one Minister’s hands and says that the Government knows best about innovation in the economy.

The Government knows better than the World Trade Organization (WTO) about setting a level playing field! The Government should just leave the decision in the hands of one Minister—in the hands of one Minister—about how this regime applies! I do not think that is right, and I think most New Zealanders would say that this bill introduces something that is not ideal for our country.

What we need, actually, is a fresh pair of eyes. We need a fresh approach to these issues. We actually need a new Government that will look to make sure that small business is not disadvantaged in this way, a Government that actually listens when business submitters come in and say: “This will jeopardise domestic industries.” We need a fresh approach where, when approached by businesses that come in to make submissions, the Government will say: “We understand that this will make your capital decisions more expensive and risky, and that you will be considering going to Australia and not investing in New Zealand as a consequence of this legislation the Government is ramming through the House.”

We need a fresh approach. We need a Labour Government, because Labour will listen to those small businesses and to the big businesses and to those who produce exports for New Zealand. Labour will not be content to manage demise, as the Government has. It has watched exports as a proportion of the economy drop year after year under its watch, and it is projected to drop further still. This Government has been managing an economy that is based on speculation, because it does not understand how to support the productive sector, how to grow exports. It can talk a big game, it can publish glossy brochures, but the facts speak for themselves.

We need a fresh look at these things. We need a Labour Government, which will actually understand small business and will support people to generate the wealth we need as a country, so that we are not an economy based on speculation and selling houses to one another. That is not the way to get rich long term, and I think most New Zealanders understand that and can see that this legislation contributes nothing to that picture.

I have touched briefly already on the concern that will be in the international fora for our foreign affairs folks, who are over there arguing for a level playing field. As we say, this will take that level playing field under WTO rules except where it suits us to do otherwise, and will concentrate that power in the hands of one person. I have raised the issue of how this bill solves a problem that does not really seem to exist, because when it has arisen in the past—when there has been a need for goods affected by countervailing duties to be brought into the country—we have as a Parliament agreed that it was a good thing. That was in the case of the Canterbury earthquake.

In the select committee, it became abundantly apparent that the Government did not really have a rationale for this bill. It is not clear what pressure has been put on the Government or whose bright idea it was to bring this legislation to the House, but it is a solution for a problem that does not exist. Worse than that, it will damage our domestic industries and will make their investment decisions more costly, because it introduces uncertainty. They have an uncertainty as a result of this, which they will have to factor into their cost of production, and they may decide to set up in Australia, as well.

It is really unfortunate that this Government is sitting with these old ideas—that it cannot take a fresh look at these issues and say: “We need a Government that supports business to build exports in a real way.” But that is not what it is doing. It is managing a decline in exports as a proportion of our economy. Building a housing speculators’ paradise is not good for most New Zealanders. The Government knows that middle New Zealand is getting sick of its arrogance, and this bill speaks to that. It speaks to a Government that is out of ideas. We need a fresh approach.

MELISSA LEE (National): I just want to address a couple of things that the honourable member across on the other side, David Clark, has mentioned. He doubts whether one Minister can actually manage the decision-making process. I guess he comes from a party where its leaders cannot actually make decisions—it actually needs a consensus and a committee, and still cannot come up with a decision—so I do understand the member’s history and the reason why he has come to that sort of conclusion. But, on this side of the House, we have confidence in our Ministers. That member was concerned that this Minister, Jacqui Dean, might be browbeaten by foreign business people, who might actually beat her down into making an improper decision—that she might be influenced. I have to say that that member has never actually been in a room to have a discussion with this Minister. She is no pushover, let me just put it that way.

This bill had a significant amount of debate in the Commerce Committee. As the Minister has alluded to, we also had that during the Committee stage in this Chamber. I would just like to thank the members of the Commerce Committee. We are a tied committee and we often do have differences, but, I have to say, we do try to work through our differences, and have the mutual respect that is deserved during the committee stage. I appreciate all the work that the committee has done, and particularly, too, our secretariat. Our clerks have worked tirelessly and do actually help us a lot—and, of course, the departmental assistants whom we have had.

As the Minister alluded to earlier in her speech, when disaster strikes or an emergency takes place, we need to be able to have practical rules in place to support New Zealand families and businesses. Giving the responsible Minister the discretion to take leadership and to take action is an important thing, and can only be done through the implementation of this bill. In the legislation we hope to pass today it says, in new section 13B(3), inserted by clause 15, that “if the Minister considers that the users of the goods subject to an anti-dumping or countervailing duty have been significantly impacted by a natural disaster or emergency, the Minister may, by notice, terminate or suspend, in whole or in part, the imposition of the duty.” I note that this wording is important, because there will be occasions where goods may need to be completely free from duties due to the nature of the emergency, and how we should still be held accountable to our trading regimes that are not vital during disaster periods.

Consistently across our legislation, this has been a key goal during this Government. Part of the reason why we have a Minister for Regulatory Reform—now the Hon Paul Goldsmith, who is also the Minister formerly in charge of this bill. This bill allows for us to strengthen the Government’s capacity to respond to disasters by, effectively, tying it together with the Civil Defence Emergency Management Act, ensuring a consistent approach to handling emergency management needs across all of our legislation.

The Minister and the member opposite have also touched on the subject of public interest tests. The consumer test is a really important aspect of this bill, and one that I am very proud to support. I am glad that we have actually come to this position in this bill. We need to ensure that when we impose an at-the-border duty, we actually take into account the potential costs to users of the product when the duty is imposed and how that might affect the wider market for those goods. If a duty is imposed and it results in the market becoming fragile, or in a severe limitation of access to the necessary product, it is important that the tools are there to revise the decision prior to implementation and to provide a fair process.

This has been a very productive process, through the select committee process, and I thank the members once again. I believe that this is a good bill, and it will certainly make a difference for better New Zealand trade law. I commend this bill to the House.

Hon DAVID PARKER (Labour): I cannot do better than repeat the words of New Zealand Steel and its very clearly expressed concerns about this bill, when it described why this bill takes New Zealand backwards and undermines the interests of New Zealand producers facing unfair competition from overseas. It said: “New Zealand Steel does not support the Bill. In our view this bill, as it is currently drafted:”—and it has not changed materially in this regard—“(i) is an unnecessary and radical shift in New Zealand’s trade policy: there is no principled reason why New Zealand producers should be expected to compete with goods illegally dumped here below their cost of production offshore; (ii) will result in a materially weakened anti-dumping regime which does not protect local producers and which may chill investment in manufacturing capacity. In that regard, the Bill moves away from what is prescribed in the WTO anti-dumping rules, which do not require an unfettered ‘public interest’ exception; and (iii) is a significant threat to New Zealand industry. The Bill will, in its current form, result in unintended and significant consequences including the chilling of investment and possible closure and job losses for many major businesses unless amendments are made as outlined in the submission that follows.”—and those amendments were not made.

This legislation is not only unnecessary, it makes the situation worse for major New Zealand producers of goods that face dumping risks. This opens New Zealand Ministers up to being heavied by some of the biggest players in the world. There is a changing world dynamic. China is, quite rightly, taking its place as one of the global forces in the world. It was, until the 1800s, one of the major superpowers in the world. It went through a period of relative decline. The ascendency of America saw it as the ascendant global power. Russia was up there for a while. Russia fell. China is on the rise, and it truly is one of the world’s superpowers. With those powers also come responsibilities, and those responsibilities should be able to be met if they comply with World Trade Organization rules.

We know—not from what the Government has told us, because this lacking-transparency Government is often hiding the true reality of what is happening from New Zealand. We only know that there were threats against New Zealand corporates as a consequence of the suggestion that New Zealand would investigate whether there was dumping of steel within New Zealand because Vernon Small at the Dominion Post broke the story. It is pretty obvious, if you read between the lines, that the reason he was able to break that story is that there are people within the arms of government who do not like what is happening under the governance of National, in respect of issues like this.

Hon Jacqui Dean: Oh God.

Hon DAVID PARKER: No, that is correct. That is correct. The Government is still redacting and refusing to disclose to the public the correspondence relating to threats that are alleged to have been made against New Zealand exporters into China in the kiwifruit industry and the dairy industry, if New Zealand investigated Chinese steel imports and looked at whether we should have anti-dumping additional tariffs on imported steel as a consequence. Is that something that New Zealand should be able to look at? Most clearly it is.

As New Zealand Steel says in this same submission, there is between 400 and 700 million tonnes of excess steel production in the world every year at the moment. Other countries, like the United States and the whole of Europe, have actually decided that some of the steel exports from China are being dumped on overseas markets. China has excess steel-making capacity, and it is selling—according to the Americans and the Europeans—into other countries at less than cost. The tariffs in America, in respect of some subsets of steel, like stainless steel, have been increased to as high as 160 percent. The higher tariffs that have been introduced in Europe, if my memory serves me correctly from what I looked at last night, have ranged from about 18 to 60 percent. The New Zealand Government has not been willing to look at it, despite complaints from New Zealand Steel.

What is the effect of this legislation on it? The effect of this legislation is very unwise, because it makes it easier for large players in the world—and I am not saying that China would ever do this, but we know from our history that big players occasionally do, whether it is the United States or Europe, we have seen their actions in respect of some of their exports over the years as well. We know that some of these big players do throw their weight around and try to pressure New Zealand, saying: “Oh, look, if you do something over there, we’re going to prejudice you in some other area of trade.”

This bill sets up a system that encourages it, because it introduces discretion for the Minister not to prevail with either an inquiry or anti-dumping duties, even if there is evidence that they would be justified. That is bad law, and that is why Business New Zealand, as well as New Zealand Steel, have come along, together with other submitters, and said: “This is wrong. This is wrong for New Zealand manufacturers.” Then the Government says: “Trust us. Trust us.” Well, why would we trust this Government, when its record on exports is so absolutely appalling?

We have a country that is investing far too much in selling houses to one another at ever-inflated prices—which is where so much of the investment capital is wasted in New Zealand—and not enough in the productive sector that grows exports to the rest of the world. That is why New Zealand’s productivity growth is virtually zero. Our productivity is not going up. As a consequence of that appalling record on productivity, our exports, as a percentage of the economy, are going backwards—backwards.

When the Government was elected in 2008, it promised to increase New Zealand’s exports from 30 to 40 percent of GDP. What has happened? It is the opposite: they have gone backwards. They went back to 26 percent of GDP; they are around 27 percent of GDP. What has the Government done? It has actually changed its targets. Have you noticed that? It has changed its targets. It has put “getting to 40 percent of GDP for exports”—you never hear it talking about that. Now its new target, which is just about meaningless, says it wants a certain percentage of our exports to be covered by free-trade agreements. Well, yeah, good. We actually like free-trade agreements. We do not like the Government selling out—

Melissa Lee: Really? You didn’t vote for TPP.

Hon DAVID PARKER: Well, actually, they bring the Trans-Pacific Partnership (TPP) into this. I am glad they have.

The ASSISTANT SPEAKER (Lindsay Tisch): No, that is outside the—

Hon DAVID PARKER: No, Mr Assistant Speaker. They cannot yell out “TPP—put that on the record.”, and you deny me the right to respond to that point, Mr Assistant Speaker. The TPP is different from the Chinese free-trade agreement that we negotiated, because under the Chinese free-trade agreement we did not trade away the right of a future Government to ban overseas buyers of our land, but the National Government has in the TPP. Even now, it refuses to try to renegotiate that, having broken the bipartisan approach on trade in respect of that important aspect of sovereignty, the Government members sit there and pretend that they are superior. They cannot escape the fact that exports are going backwards, that their failed policies—after 9 years in Government—have exports lower as a percentage of GDP, when they promised to increase them from 30 percent upwards to 40 percent of GDP.

This is very poor legislation. Business New Zealand is right. New Zealand Steel is right. This is going to take New Zealand manufacturers backwards over time. The Minister is creating pressure points that can be used to distort what should happen when dumping is found to occur.

BRETT HUDSON (National): It is a pleasure to rise in support of this bill, the Trade (Anti-dumping and Countervailing Duties) Amendment Bill, in this its third reading. There are three things that I would like to cover today. The first one is actually what brought this bill about. We had a set of circumstances. The circumstances actually accrued from a natural disaster. After the Canterbury earthquakes, we determined that it would be a good idea to free up the ease of bringing building materials into New Zealand, because of the high volume of construction that was going to be required, which, ordinarily, would otherwise cause prices to rise. What the Opposition members do not realise, because they think—and you can hear it in their speeches throughout this bill’s passage—that it was because of the Christchurch earthquake. Well, the Christchurch earthquake was a set of circumstances under which the problem arose. The problem was the volume of construction required and what that would otherwise do to material prices.

In making a legislative change then, to allow us to act the way we needed to, we realised that, actually, there was an opportunity to put a framework in place to allow a Government of the day to adapt and respond to whatever sorts of events might be facing whatever part of our industry or economy at a given time. It is not just earthquakes or floods; there could be dry seasons that lead to growing issues. There could be any number of things that might occur that could lead to a shortage or a situation where allowing more free flowing of goods from outside New Zealand would be a good thing for consumers, in particular. So what we look at here in the Opposition’s opposition to this is that they are saying that every time something happens, pass another bill—get together in Parliament, take up time, do more legislation. What that shows us is that they are an issues-based group. They are down in the weeds at a detail level. If you want to be nice about it, we could say they are trying to manage things, whereas this Government, by putting in a proactive framework, is showing that we are about governing—governing, not simply managing.

The second part I would like to cover—and it was raised by the Hon David Parker yesterday, and I think he touched upon it again today, actually—is showing a failing of understanding of how the processes under the bill would work. In fact, it is a misunderstanding of how the process works today. It was raised, particularly yesterday, that the passage of this bill, when enacted, could mean that dumping would not be investigated. Well, that is simply not the case, because the process today is that if a complaint is made about a suspicion of dumping, an investigation is undertaken and it is determined whether or not it exists in fact. When this bill is passed, that will remain 100 percent the same: if there is a complaint that dumping could be occurring, an investigation will be undertaken. It will be determined whether or not that is happening in fact, and only then—then and only then—will it be decided whether a public interest test should be assessed. So this does not compromise the investigation into dumping nor the finding of fact as to whether it is occurring; it simply then gets to a point to say: “Right, we know it’s there. We know we now have a right to take action. Do we want to make an assessment as to whether there’s a public interest to set aside the action that we’re allowed to take?”.

The third part I will touch on before finishing is the idea that somehow the Minister is responsible for that. Again, it shows a complete lack of understanding of the bill and how the processes that flow from it work. The Minister gets to determine, yes, whether we should have a look to see whether there is a public interest in the situation, but it is officials who actually undertake the public interest test. They are the ones who publish the findings of that public interest test. Yes, the Minister will make a decision as to what to do, but they will make that decision with the information in the public domain. So, in fact, it is not really the Minister who will be determining, at their whim, whether or not a public interest will apply; they will be deciding whether to investigate that particular aspect and then making a decision based on official material that is supplied back.

So, very simply, this is a very good bill. It is a bill that shows a governing approach to the country not a management one. It is one that I wholeheartedly support, and I commend it to the House.

BARRY COATES (Green): Tēnā koe e Te Māngai. Is it really too much to ask for a New Zealand business to call for a level playing field so that it can compete internationally, so that our businesses that invest their time, their capital, their skills, often their houses—everything they have—in their businesses are able to succeed in competition with international competitors? That should be the basis of our support for business—the fact that we will make sure that they have the opportunities to compete at least on a level playing field. However, in this world some companies compete unfairly. We have international competitors that dump their goods in New Zealand markets at below the market price in their home countries and below their costs. When they do that they adversely affect our New Zealand companies. That is why we have anti-dumping laws.

However, today we are considering a bill that is not about protecting New Zealand companies; it is actually about saying: “Let’s not apply these anti-dumping rules if we come up with some arcane public interest test that says we shouldn’t support New Zealand companies.” This bill removes that protection of New Zealand companies from predatory dumping by foreign competitors and exposes them to greater uncertainty, higher costs, and extremely long delays in order to get any remedies when they are being driven out of business by unfair competition.

The bill has three steps. Firstly, a company has 180 days—6 months—for its claim of anti-dumping to be processed. It has to provide a huge amount of information, which is a real burden on small to medium sized enterprises (SMEs). Secondly, then there will be a determination of whether it has a case and what the anti-dumping duty should be that is applied on the imports. What this bill does is it adds a third stage. After that it says: “Well, the Minister is then going to apply a test, and that test will say: ‘Should we completely disregard this whole analysis and should we just feed our local companies to the wolves? Should we just allow them to be predated and forced out of business by foreign competition?’ ”.

So what did the submitters say about this? Well, Business New Zealand is strongly against it. So is the Manufacturers and Exporters Association, so are the wood processors, so is Horticulture New Zealand, the Flower Growers Association, and virtually every other business group. They do not like this bill, and neither do we. It is a bad bill. The New Zealand Flower Growers Association says it rejects that there is a “need to tilt the playing field” in favour of dumped and subsidised goods from overseas against local business. What is this? We are tilting the playing field, not in favour of our small business but against it. What kind of support is that from the Government for small business?

So what happens if you create a bill like this? If you say to foreign companies “You can dump your products and then, actually, if you’re able to stay there for a while the Government may well then allow you to continue without duties.”, what kind of incentives does that create for foreign companies? They will come into this market in their droves. They will dump their goods, they will drive the local company out of business, and then what will they do? They will raise their prices again. And you cannot just turn around and recreate a company.

As the peach-growers association says, you cannot just turn the supply of peaches on and off. It takes 6 or 7 years to grow a proper peach crop. Their case, the Hawke’s Bay producers, was that they lost $15 million when Greek imports of peaches were dumped. They made the point that this is not just something that affects the peach growers; this affects the whole community. It affects the whole supplier base, the whole economy, and the whole community. This is what we are losing by leaving our local companies at the mercy of foreign predation.

We could also be talking to New Zealand Steel. The dumping by Chinese steel exporters has been proven in the United States and the European Union. They came here and, New Zealand Steel says, the price dropped by 82 percent on the New Zealand market. What is New Zealand Steel to do? It makes a complaint on anti-dumping. Now we have a law to say: “Well, you know, that’s OK. The consumers are actually benefiting from lower steel prices.” And what does that mean? It means that another New Zealand company may be driven to the wall if we apply a public interest test and we say that they should not be protected from unfair competition from overseas.

So in order to try to correct some of the worst aspects of this bill, which by the way we voted against, we put down some amendments. In one of the amendments we said: “OK, if you’re going to do this, you need not only to look at the short term; you need to look at the long term. What does it mean in terms of a dynamic economy?”. You cannot just take a snapshot in time. Actually, you have to understand the dynamics over many years—over the full life cycle of firms that may go bust and then a whole supply chain falls over, because there are interconnections between different industries through the supply chain. We said you have to look at that. You have to look at employment, you have to look at skills, and you have to look at a whole lot of factors that the Government is not looking at in its supposedly independent view of a public interest test. Our amendments on this bill were rejected, as were the recommendations in all of the submissions.

We are seeing a decline in manufacturing in New Zealand. This is not a short-term issue; it is a long-term issue. We are seeing a decline in productivity. We are falling down the rankings in the OECD on productivity. We are seeing a drop in exports as a proportion of GDP. The apparent success of our economy is built on services, on tax havens, on real estate, on speculation, and on the financialisation of our economy. We are seeing a hollowing out of the productive economy in New Zealand, we are seeing a productivity growth that is one of the worst in the OECD, and what are our young people going to do? Instead of going into high-skill, high-value manufacturing jobs, which are being hollowed out, they are going to have to flip hamburgers. This is the kind of economy that you have when you do not support the New Zealand manufacturing businesses and when you allow things like this bill to predate our local companies.

So we need to support our local business and SMEs. At the moment, what they are facing is not only this bill; they are facing a lack of protection against foreign companies and foreign multinationals that do not pay tax in New Zealand or anywhere else around the world, which have an inbuilt advantage. They are facing online products being sold by Amazon and others that do not have 15 percent GST, and now Amazon is setting up in Sydney. What is that going to do to New Zealand companies? It is going to wreck more New Zealand companies. And we are seeing trade agreements that do not look after small and medium sized producers, and we are looking at procurement rules that are tilted against small companies.

In each of these ways, this Government is failing small business. It is failing the productive economy. It is time that this Government actually started to realise that this is not the way to build a New Zealand economy of the future. It is a short-term, reckless, speculative economy, and it is time that this Government left. We will do better when we are in Government, on 23 September.

RIA BOND (NZ First): I am proud to rise on behalf of New Zealand First, and actually on behalf of my colleague Fletcher Tabuteau, to speak to the third reading of the Trade (Anti-dumping and Countervailing Duties) Amendment Bill. When the bill was first read, we in New Zealand First made it clear that we would support this legislation only to go into the select committee process, and that was because New Zealand First had major concerns about how this bill put up by that National Government would ultimately, in the end, make New Zealand made products vulnerable to unfair, predatory pricing by international companies.

This bill will affect the innovation of small businesses. Kiwi businesses actually have to compete around the world, globally, and this is no easy platform for our Kiwi businesses. What this Government has done through this legislation is add another hurdle into the mix, which will cause more risk and more uncertainty. Not only will our small businesses in New Zealand suffer through this but so will our manufacturing and export sector.

Let us talk about the public interest test, or, as Minister Jacqui Dean said last night, the consumer interest clause. I want you to listen up. I want you to listen up, National members on the backbenches today—

Chris Bishop: Oh, righty-o.

RIA BOND: I want you to listen carefully, Mr Bishop. The public interest test is the most damaging clause in this legislation—

Chris Bishop: This’ll be good—trade expert, Ria Bond.

RIA BOND: If you Government members had bothered to understand this, Mr Bishop, and actually listen and do some homework yourself, then you would have known by your research that this actual clause—and it is clear as crystal—gives foreign companies and Governments that are considering dumping into the New Zealand market a green light. The protection that should be there to protect our New Zealand market, which would have had the ability to kick-start a protection mechanism to alert foreign companies and Governments considering dumping, is simply not there. It is not there in this bill. Ultimately, sanctions against us are actually weakened.

This is the reason New Zealand First supported this bill to go into the select committee process. The reason why was so that members on the Government side of the House could actually hear the submitters, hear their voices, and hear how this bill will affect the market, which this bill presumably is meant to protect. What I am talking about, as other members have also said in this House today, and what was overwhelmingly obvious from the submitters, like Horticulture New Zealand, Business New Zealand, New Zealand Steel, Foodstuffs, and many more—what we heard was that, ultimately, this bill would be no good for them. At that stage, as other members have also said, we in the select committee did work really hard on this bill. We looked through all avenues and looked at the risk, we sought the advice of advisers, and the bill was returned to this House with no changes.

At that point, that should have indicated to the Minister that there was a real issue here. There should have been an indication. The Minister should have pulled this bill—as other members in this House have already said—and taken it back, had a look at it, and actually given careful consideration as to the limitless risk that this bill would put the New Zealand market through. Did that happen? No, it did not. It did not happen at all, and the Government kept pushing this bill through. What this bill will do—and I am going to repeat myself, I am sorry—is tilt the level playing field of dumped or subsidised imports, rather than support local producers and local jobs.

The submitters categorically told us that this bill was bad for them and bad for New Zealand. The public interest test—it was an absolute risk that the Government actually even had it there. Submitters wondered why—and other speakers have said this already—the Australian Government tried twice to have a similar type of regime to this, and both times it had listened to its businesses. It listened to the people who actually help import and export into that country. It listened to the risk that the small business owners faced—like the Kiwi business owners; the people whom we know in this country—and it said “Uh-uh, no deal here.”, and it flicked it off.

What we wanted to know—and what we have heard throughout the calls taken in this House—is why the Government is still supporting this. Why are the Government members still supporting this bill? Why are they still supporting the public interest test, which is almost like a bit of a cannonball that is going to come right through our market and shatter it over time?

On this side of the House, the Opposition did put forward a minority view, and what we did was we outlined the absolute risk involved in this bill. Actually, it could not have been any plainer. It could not have been any more crystal clear why this bill is not good for this country, and why this bill should have been taken away, taken back, and amended significantly to put the best interests of New Zealand first. But that has not happened.

I also want to say that the Minister produced a Supplementary Order Paper yesterday. I went through that Supplementary Order Paper and I was absolutely astounded that that Supplementary Order Paper only makes this bill worse. It only makes this bill worse. I sat there and I thought: “What is this Government doing? What are you doing to your businesses here in New Zealand?”. I thought “This is absolutely crazy.”, and I kind of sat here and thought: “I know automatically that this bill and the Supplementary Order Paper will actually take New Zealand businesses backwards.” It will take them backwards, not forwards. Someone with half a brain would have known that straight away.

New Zealand businesses are unnecessarily and radically—through the Supplementary Order Paper, without principle—materially weakened. It has absolutely weakened the anti-dumping regime. It is a move away from the World Trade Organization (WTO) rule and it will cause significant risk to all business closures and jobs.

I want to touch on what other members have actually mentioned throughout the time of the passage of the bill through the House. One of the members, Dr David Clark, summed it up nicely last night when he said that this bill is tragic. The solution undermines the New Zealand domestic producers. It undermines New Zealand businesses and their competitiveness. He also said that it also moves away from the WTO guidelines. That is why I sat there and I was astounded, and New Zealand First was absolutely astounded, when we saw that Supplementary Order Paper.

Other members also said, I think, from memory—we have all mentioned the fact that the Australian Government had the good sense to realise how bad the public interest test was, and it got rid of it because it did not want to create uncertainty in its market or have a crippling effect on the Australian market in terms of anti-dumping and countervailing. I have to say, and we say on this side of the House, that National cannot deny that there will be pressure put on the Government, that there will be all sorts of threats from around the world, and that flak will actually happen. As Mr Parker outlined earlier, we have seen evidence of it here already in recent New Zealand history.

I have got about 2 minutes left, and I want to talk about the fact of the general feeling about this bill. From the time that it came through the House for the first reading, through the select committee process, the second reading, and the Committee of the whole House last night, New Zealand First has not shifted its position. This is an absolutely appalling bill to this New Zealand country, which has been put forward by this Government. This bill will actually create absolute uncertainty throughout our market. It will not support local New Zealand businesses, and it will not support local people who need jobs in this country. It will actually cause mass job losses. New Zealand First absolutely does not support this bill.

KANWALJIT SINGH BAKSHI (National): I stand in support of the Trade (Anti-dumping and Countervailing Duties) Amendment Bill. This bill is in accordance to a World Trade Organization (WTO) agreement, and New Zealand is ratified according to the WTO agreement. This bill will introduce the test of an anti-dumping regime, which will be a better balance for consumers’ interests and those of manufacturers threatened by unfairly priced imports. We have to understand that we want to ensure that the consumers benefit from healthy competition, and this will create healthy competition for them. As we have seen in many areas, particularly in the construction area, competition has been unfair. We can import products on a cheaper base so that we can have healthy competition for the manufacturers over here, and this will go a long way. I hope that this bill will benefit not only the consumers but also others.

This bill introduces the public interest regime, which considers whether consumers are benefiting from the lower price, more choice, availability, and quality, and whether this outweighs the effects on industry. There are checks and balances available in this bill that will help both industry and consumers. I commend this bill to the House.

The ASSISTANT SPEAKER (Lindsay Tisch): The next call is a split call. Mojo Mathers—5 minutes.

MOJO MATHERS (Green): I would like to take a call on this Trade (Anti-dumping and Countervailing Duties) Amendment Bill. As someone who has sat through some of the select committee hearings and heard from the submitters, I have to say that it is extremely frustrating to see their concerns—very valid concerns—being completely dismissed and ignored by the Government. Previous speakers have outlined some of the very real risks and threats to local New Zealand industries.

They have also outlined very well why dumping is such a damaging practice. It is destructive, damaging, predatory, unfair—it is all of these things. That is why the original law that this bill would amend put in place a system of protections, of imposing anti-dumping duties and countervailing duties on the products that are deemed to have been dumped on the New Zealand market. This predatory practice is destructive, no matter which way you cut it, and, as my colleague said, once we lose manufacturing expertise in an area, it is very difficult to re-establish that at a later date when that product is no longer available at rock-bottom prices.

At the moment, New Zealand’s economy is already dangerously reliant on exporting large volumes of low-value commodity products. The last thing we need is a law that will immediately increase investment risk and undermine other value-added industries, especially in manufacturing and construction, which are the very areas that we need to help diversify the economy and increase economic resilience. Our largest economic trading bloc is Australia; they have decided against going down this path, and it is ridiculous that we in New Zealand, being a much smaller economy, are instead going ahead and weakening our already minimal protections for industries in New Zealand. It is almost like National is putting up a great big sign saying: “Do not invest here. Go to Australia instead.”

Losing local industries in the manufacturing sector also makes it much harder to monitor issues of quality control and accountability. Cheaper is not always better, especially when it comes to building or construction materials, when poor quality materials threaten people’s safety and homes. That was evident all too recently, when 1,600 tonnes of steel from China was found to be too weak for four bridges on the Huntly bypass project. Officials have already acknowledged that adding a new public interest test will make the Acts more complex, reduce the overall effectiveness of the New Zealand anti-dumping regime, and increase uncertainty into the process.

It is really important to realise that at the moment, right now, it is already a high threshold to reach to determine whether dumping is occurring. It is expensive and it is time-consuming. Industries only do that when they really have their backs up against the wall, they know they are not going to be viable, and they have a rock-hard case to bring. Now, when they bring that case, what is going to happen? All that effort could go down the gurgler because there has been an extra test introduced that says: “Oh, but there could be some benefit to consumers.” There will always be some benefit to consumers in the short term.

What we have to look at is the long term; what is in the national interest, not just what is in the interest of a few consumers buying that product right now. Where are we headed as a country? What is our long-term economic vision for the country? Do we want strong, resilient, robust New Zealand - based industries? We need that. That is what the Green Party supports. That is why we oppose this bill.

MICHAEL WOOD (Labour—Mt Roskill): The Trade (Anti-dumping and Countervailing Duties) Amendment Bill is the ultimate example of a solution that is looking for a problem—the ultimate example of a solution looking for a problem. I have sat here and listened to speech after speech from the Government members, I have read departmental statements and media releases, and it is still unclear to me what the public policy problem is that we are trying to solve here. I will give some credit to Brett Hudson, when he got up to speak before, because he has been the only member from the Government benches who has actually tried to define what the problem is. It was painful—it was like Mr Magoo groping around during a power cut—but he came up with one reason why he thought that we needed this bill, the Trade (Anti-dumping and Countervailing Duties) Amendment Bill. He said, somewhat perplexingly, that if we have a drought, there might be a need to have cheaper products in our economy.

That spoke exactly to the problem, in fact. We have vulnerable producers in our country, vulnerable producers in our agricultural sector—people like the peach-growers, who have submitted to the select committee on this issue—who face issue after issue, challenge after challenge to keep their businesses sustainable without the threat of dumped goods coming in from overseas and entirely wiping out their businesses and their livelihoods. That was the closest we got to a reason for this bill, and I challenge any of the members who guffaw across there to actually put forward a reason for why we have this bill.

When you read the departmental disclosure statement, there are, I think, a sum total of seven current cases where we have anti-dumping duties and countervailing duties in place at the moment—about seven. Again, what problem are we trying to solve?

The other thing that has not been explained to me—I think it is absolutely mystifying and curious—is the fact that the public interest test runs directly counter to the point of anti-dumping duties. Here is the thing: why do you dump goods in a market? You dump goods in a market because you want to be able to sell them under the market price and you want to knock out the market producers. So the dumping relies entirely on your being able to sell your goods very, very cheaply. Yet, in the public interest test that the Minister considers, she has to consider the effect of the duty on the prices of like goods produced in New Zealand.

This runs directly counter to the point of us having duties in the first place. It would be like a robber standing before a judge before sentencing and the judge having to consider the injustice on the robber’s family of that family not being able to keep the stolen goods. The mischief here is that goods come in below market price, they knock out local producers, and here we have the Minister being able to consider that those low, below-market prices are a good thing, and she has to weigh that against the damage that is done to our producers. That is completely counterintuitive in a public policy sense.

We heard submission after submission from organisations that you would normally count as part of a solid National Party constituency: the agricultural producers, Business New Zealand, Horticulture New Zealand, and the peach-growers, and time and time again they raised the risk of this bill to their businesses and to their livelihoods. They made two very important points, which, again, have not been responded to by the Government benches. They raised these two points: that often, particularly in the agricultural sector—and I would have thought the National Party would be sensitive to this point—if dumped goods come in and they destroy businesses, that is it for a long time. Once the trees have been cut down because your peach orchard has been undermined by dumped goods, that is it. You cannot grow the trees and have peaches again next year; it is a 5- to 10-year downtime for that industry.

We heard from Business New Zealand as well about the downstream effect, something that is not considered in the public interest test, because many of these industries in horticulture and in manufacturing do not just employ people in their locale; they have a huge number of businesses and entities that supply them and rely on them and supply employment to large numbers of people. That will not be considered, and we have not heard a response to that from the Government.

This is going to be another kick in the guts for our exporters, who already have a hard time of it. We heard before from my colleague David Parker that this Government had a goal of increasing our exports to 40 percent of GDP. It has quietly dropped that one, as exports have dropped to under 30 percent of GDP, and this will make it more difficult for our exporters. This bill goes to the fact that this Government has no ideas to support our productive exporting economy, and it is time for a fresh start with a Labour Government after 23 September.

SIMON O’CONNOR (National—Tāmaki): I am always struck by how those on the other side of the House have to sort of get their pre-set political lines out at the end, to keep manufacturing a crisis. In fact, this bill is nothing to do with any crises in the sectors.

What we are dealing with here is, actually, a piece of legislation that is dealing with exceptions. This is why it has been designed—it is to deal with exceptions and to allow a Minister, obviously working with advice and with prudence, to make some decisions when exceptional circumstances are required. And so that is particularly to do with duties, obviously, as we have heard from a number of speakers.

The long and the short is that discretion has been given in this bill to a Minister, in this case the Hon Jacqui Dean, to make a decision about whether a duty is or is not required, through the use of a public interest test. It is something that is not in play at the moment.

And, yes, we have heard from various people and organisations that are concerned it might impact their business. The important thing is that their voices still remain. There is still that opportunity to raise those issues, and the Minister will act accordingly.

I view this bill, particularly coming out of what has happened in our natural environment—those various disasters that have hit New Zealand. We saw, particularly in Canterbury, that part of the response was to remove duties in some areas, to make sure that we could get the goods required, particularly in the building sector, into the country quickly and at a lower price so that we could develop the rebuild.

So several members of the House have sort of asked: “Well, why is this being done? What’s the point of it? It’s just nonsensical.” In fact, it arises out of a very particular situation. And so while the bill, on one hand, is talking about the public interest test, the bill is also strengthening or learning, for want of a better word, from what happened in Canterbury as to how we better handle duties around natural disasters. I will not bore the House, for want of a better word, by going through some of the particular details, but those who know the bill well, know that we are also looking, through this Act—or, rather, Act-to-be, if that is not overly presumptuous of myself—to extend the suspension of anti-dumping duties for a couple more years. Again, it is coming out of the natural disasters that New Zealand has faced. We understand how we acted then, and we see that this is a bill that puts the mechanisms in place, whether there are further disasters or just simply a need that is in the public interest, so that the Government can act. So I heartily commend this bill to the House.

CLARE CURRAN (Labour—Dunedin South): There has been a lot spoken about on this bill in the House over the last couple of days, and I think it is pretty clear that it has come down to the fact that, while New Zealand already has an existing system in place to apply these countervailing duties on dumped goods, what this bill is doing is applying a ministerial discretion, not only about whether or not a public interest test investigation can be undertaken but then, once that investigation is undertaken, what the outcome of that is going to be.

What the big concern is, not only on this side of the House but throughout our productive economy, from Business New Zealand down to the small flower-growers in New Zealand, is that this puts too much power in the hands of a Minister to make a decision based on a competing set of priorities with the concern that there might be the ability for influence provided by big countries with interests in putting their dumped goods into our country, which will have an adverse effect on our productive economy and on our industry.

That is the crux of it, and I have not heard any arguments provided from that side of the House—from the new Minister of Commerce and Consumer Affairs, Jacqui Dean, down through the National members who have got up and defended this bill as to what the overriding reason is. I think the last speaker, Simon O’Connor, got up and talked about the Christchurch earthquake as needing to bring in building goods—6, 5, or however many years later, that is no longer the case. Brett Hudson got up and talked about the fact that “Oh well, we don’t want to do it on a bill-by-bill basis; we need to take a governing approach to this.”, and yet there is no actual justification for this.

Our nearest neighbour, Australia—the Australian Productivity Commission looked at this. In fact, it has had two goes at this, and both times the Australian Parliament decided that it would not go down the course of action of introducing a public interest test. We are undertaking a lot of harmonisation legislation—moves towards harmonisation and different sorts of regimes, whether it is the accounting, the intellectual property, the patent attorneys, or the training regime for that. There are many other kinds of areas where we are looking at harmonisation with Australian law. Why is it that we are not doing that in this case—that we are not looking to be more in line?

The argument used by the Government is “Oh no, Canada has a public interest test.” Well, I went and looked up what that test has resulted in. Since 1990 the public interest test has been considered by Canadian authorities in five cases, with a further 12 requests that have been rejected. A reduction of duties was recommended in four, and the Canadian Government accepted this in three of the cases.

I do not know what the overriding argument is. What is the issue here? I think Michael Wood was right to say that this legislation is a solution looking for a problem. So there are many things to be very concerned about in this legislation. I am not going to relitigate all of them; I just want to touch on the fact that there are deep-held fears that the public interest test will harm our domestic industry. Introducing what is called a consumer test or a public interest test may end up harming our productive economy. How can that be a good thing, especially when our exports are not going forwards; they are going backwards? This Government claims to have a goal, although it has gone quiet on it, of having exports at 40 percent as a percentage of GDP. As David Parker, I think, pointed out earlier today, we are back under 30 percent, and around 27 percent. So how is it that this is actually good for the New Zealand economy? What is actually the benefit here?

The other issue that I am concerned about is the time taken. A number of the submitters on this bill talked about the time taken to undertake an investigation, and the impact that has on their industry while that happens. We heard from the steel industry that this legislation could actually end up sending it out the door. If there is a glut of, for example, Chinese steel on the New Zealand market, it will affect the New Zealand steel producers. If there was to be a public interest test undertaken—if there was to be the time taken to do that—what impact is that going to have on industry while we wait for the outcome of that?

The eight factors to be taken into account and the lack of prioritisation or any sense of what the weighting is of those factors—whether it is lowest price, or whether it is increased choice, or whether it is the quality of the product and the impact on the producers—there is no sense in the Government’s intent in this legislation as to whether any of those factors are to be considered any more important than any others. Therefore, it provides more uncertainty for our producers. It makes us wonder why on earth we are having this legislation in the first place.

So Labour opposes this bill. We supported it at first reading because we thought, you know, it was worth having a discussion about. We realised very quickly, as submitter after submitter after submitter came before us, and pleaded with us, and wrote to us afterwards with more information, how concerned our producers were in our country. As a result of that, the Opposition took the view that this was an ill-thought-out exercise. As the Commerce Committee is a split committee, the bill was sent back to the House unamended, and at the Committee of the whole House stage the Government used its majority to force it through.

So here we are in the third reading, having a debate about a piece of legislation that could have a significant adverse effect on the New Zealand economy and our ability to be a more productive economy. You have to ask yourself why that is, what the influence is that is being brought to bear on the Government in order to introduce this public interest test and to potentially allow large amounts of products to be dumped in our market and affect our economy. I think that is the $64,000 question before this House today. The Labour Party absolutely opposes this legislation.

ALASTAIR SCOTT (National—Wairarapa): I was not on the Commerce Committee during this process, and so I am a fresh set of eyes. I find it quite an interesting bill, and one that is extremely commendable—commendable—to the House. It has a new piece with regard to public interest, and that is what we do with everything we pass through this House. We should always have public interest in mind. The original Act, the Dumping and Countervailing Duties Act, does not have that aspect, which is being introduced with this bill, so for that reason alone that is a good thing. The example of the peach-grower or the orchardist was painted by the Opposition, and it was a little bit of a scaremongering example. It was like, you know, you bring in some cheap peaches and the whole peach industry is going to collapse. Well, that is not in the public’s best interests, to have the peach industry of New Zealand collapse. So, of course, that would not be an example where tariffs would be removed or allowed to be dumped if the result was that the peach industry would collapse.

Of course, the price of the domestic product is considered. The resilience of the industry and how it might affect that industry is considered as part of the public interest. It is not just about getting cheaper goods in here. You can imagine talking about a product—it does not really matter where it is from; coming in from China has been given as the example—that is going to be cheaper. The question is should we tariff it or should we not. Is it in the public interest to allow that stuff to come in? It may compete with other product from, say, Australia, or, say, from America. Why should it not be in the public interest to allow the Chinese product to come in and compete aggressively with, say, the American product or the other product? It is an excellent bill. It considers public interest, and I commend it to the House.

A party vote was called for on the question, That the Trade (Anti-dumping and Countervailing Duties) Amendment Bill be now read a third time.

Ayes 60

New Zealand National 58; ACT New Zealand 1; United Future 1.

Noes 59

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

Bill read a third time.

Bills

Taxation (Annual Rates for 2017-18, Employment and Investment Income, and Remedial Matters) Bill

First Reading

Debate resumed from 23 May.

ANDREW BAYLY (National—Hunua): It is a pleasure to be talking on this Taxation (Annual Rates for 2017-18, Employment and Investment Income, and Remedial Matters) Bill. This bill is another in a long continuum of bills that we have brought to the House in terms of modernising and improving the settings for the administration of our tax system—which, as we all know, is one of the best in the world—and improving the current tax settings within a broad based - low rate framework.

What I just want to highlight is three areas of the bill. The first one is around employment share schemes. What the bill seeks to do is better align the tax treatment around these with other forms of employment income tax. One of the key changes now is that employees will be taxed on the value of their shares at the time when they meet all the necessary conditions to earn them, rather than when they are initially granted and put in trust. It is common practice that when employment share schemes are set up they are put into a trust and then, over time, the employee gets a benefit once they have met preconditions. In essence, what we are seeking to do is address the concerns that employment share schemes can be used to give employees, basically, tax-free remuneration.

The other area is in employment income. What we are trying to do is reduce the compliance costs for employers by making them, at the time they file their PAYE on a monthly basis, ensure that all the details are then supplied to the IRD at that point, which is a more regular threshold. It reduces the threshold at which companies must, on a mandatory basis, file using electronic means, from a threshold of $100,000 down to $50,000. These are a couple of really good measures. I am really looking forward to debating and discussing this bill at the Finance and Expenditure Committee.

BARRY COATES (Green): Tēnā koe e Te Māngai. I rise to speak about the Taxation (Annual Rates for 2017-18, Employment and Investment Income, and Remedial Matters) Bill—quite a mouthful. It is good to see this bill arriving at the House before the finish of the tax year. We recall that last year’s bill on annual rates, to be set for 2016-17, arrived in the nick of time before the tax year actually started, so at least this year we have the tax rates, which are unchanged, apparently, in the next financial year. Although, given the fact that this is the day before Budget day, who knows?

So we accept this bill as it is. Broadly, it is a bill that makes a number of minor changes. Modernisation, I think, is the theme that is spoken of, and the Green Party broadly supports most of the measures. We support this bill to the select committee, and there are a number of aspects of the bill that we will look to scrutinise. We hope that there will be a degree of accountability on key issues. One of the key issues in this bill is that we can identify a number of measures that will support small and medium sized enterprises (SMEs)—and that is good; it may help reduce compliance costs in some areas. However, there are some worrying aspects of the bill and some things that we have concerns about, with regard to the potential compliance cost for SMEs.

A second issue that concerns us is the potential link from this bill to social policy and social investment measures. While we recognise that income in the hands of beneficiaries should be able to be accounted for and the tax aspects handled as simply as possible, the linking of this tax bill with social policy gives rise to some concerns. We are certainly going to be looking closely at those measures. Through the bill, there is reference to a number of areas where there may be links to child support, KiwiSaver, Working for Families, and also to student loans, and we are going to be looking at those links to ensure that this bill helps simplify and support rather than impose additional burdens, compliance costs, or unwarranted conditionalities on recipients of those Government grants.

Thirdly, we will also take a particular interest and a look at employee share ownership schemes. Employee share ownership schemes are a significant part of this bill. We are going to want to look closely at the changes that this bill introduces for employee share ownership schemes. We have, as the Green Party, a reflex support of share ownership schemes, of ways to give staff, particularly in small business and start-ups, a stake in the companies where they work, a material investment of their time, of their expertise, and of their investment in the company. So the degree to which we can support these companies being a shared enterprise, I think, the greater the linkage in satisfaction for those who work in these businesses, and also the greater the chances of success of the businesses themselves. So we are going to be looking very closely at those changes in the employee share ownership schemes. There are already a couple of things that we see in there that would give us cause for concern.

A fourth area that we want to look closely at is petroleum mining decommissioning. We understand that what this bill aims to do is, instead of spreading back the cost of decommissioning over prior years—a complicated arrangement—it would create a system of tax credits. That, by itself, is not a cause for concern, but we are going to be looking very carefully, especially given the experience in mining companies and oil production companies of the end of life, the decommissioning, and the remediation not being paid for by the companies themselves but creating a public liability after the private sector enterprises have made an enormous amount of money and then walk away from their social and environmental responsibilities. So we are going to be looking very closely at that aspect of the bill.

Fifthly, the bill creates provisions for Lloyd’s of London tax simplification and pharmaceutical company tax simplification. Again, the tax simplification in itself is not necessarily a bad thing, and we will certainly be interested in how that operates. We do have concern that the formula that is being applied is that 10 percent of Lloyd’s premiums are going to be used as the basis for assessment of a company tax of 28 percent. We are going to be wanting to understand closely, with evidence, how that figure of 10 percent is arrived at and the degree to which it is the appropriate tax liability for Lloyd’s of London and, similarly, for pharmaceutical companies.

I should say that the bill also provides for new charities that come on for donee status. There are five companies that will receive charitable tax deductions. Having previously managed one of those organisations that had donee status, it is an important step for organisations to achieve that. I am very pleased that Médecins Sans Frontières is one of those organisations, having worked closely with it in the past. I think it is an immensely important organisation internationally. It is great to see it having a base in New Zealand, and it is great to see it having donee status. We also welcome the four other charities that have gained donee status.

Finally, we see in the wording around this bill that the reforms will minimise “the biases that taxation introduces into economic decisions.” Unfortunately, we do not see the broader examination of those biases to include issues like ensuring that multinationals pay tax in this country, or equitable treatment of GST so that online companies supplying the New Zealand market from overseas with products actually have to pay their fair share of taxes, as New Zealand companies do; nor do we see the inherent regressivity that has come into the tax system being reversed. So while the bill is making a number of very minor tweaks and changes to the Act, we note that the big issues have not yet been addressed. We do not think that they are going to be addressed in the Budget tomorrow, but who knows—maybe we are going to be surprised?

Hon Member: Doubt it.

BARRY COATES: Doubt it—thank you. I think, overall, this bill is welcome. I will not welcome it if, instead of these benign aspects, we see the bill being used for an intrusive administration with social policy. We have already seen social policy coming into our privacy provisions, with NGOs that receive grants having to divulge who their client base is. So we would not like to see that kind of approach adopted in the system under social policy. We have concern about the pre-population of tax returns, in so far as we should not necessarily move back to a situation of tax returns being mandatory for all. With those caveats around the kinds of issues we are going to be looking at in this bill, we will support it to committee stage. Thank you.

RICHARD PROSSER (NZ First): I am very pleased to rise on behalf of New Zealand First and on behalf of my colleague Fletcher Tabuteau to make a reasonably brief statement on the Taxation (Annual Rates for 2017-18, Employment and Investment Income, and Remedial Matters) Bill. I am pleased, as Mr Bayly was, but not necessarily ecstatic. Tax bills are not something that we generally get excited about, which is kind of anachronistic, because they are a major part of the business that this House concerns itself with. Members of the public watching do, I think, have to have confidence that in amongst all the other shenanigans that go on, particularly during an election year and particularly in Budget week, Parliament is actually debating matters that do affect them, and have the potential to affect them seriously, and tax and revenue is one of those issues.

I do want to pick up on something that my colleague Mr Coates mentioned with regard to considerations around remediation and decommissioning of oil, mining, and so forth. I think that those are certainly very valid observations, but we do have to be cognisant that in the grand scheme of things, such operations can run for decades, and the cost of cleaning up, decommissioning, and remediating has to really be seen, if it is going to be done—if it is going to be, as the concern was raised, carried out by the private corporate in question that has profited from the undertaking, the cost of that decommissioning and cleaning up has to be taken as part of an overall view of the costs and losses and profits of that operation over its lifetime. So it is important that whilst we are not seen to be favouring foreign corporations, we also have to be fair to them because, like any other business operation, the scale, the nature, the scope, and the time frame of their business and the undertaking, and so forth, has to be taken into account. Many businesses that run for generations such as farms and so forth do have annual costs, but they do not then have a 50-year or a 70-year decommissioning period.

So that is an important aspect that will be examined in the Finance and Expenditure Committee. I am not a member of that committee, but I know that members from across the House will be very keenly investigating the submissions from concerned people—both those who support taking a more aggressive approach and those who perhaps take a more conciliatory view based on the long-term nature of those businesses.

So, going back to brass tacks, one of the important matters of this bill is that it does set the annual rates for 2017-18, and, as Mr Coates pointed out, the last one of these bills that we passed—I am not sure it was quite in the nick of time; I think it was actually a little bit late—squeaked through, and we do have to dot the i’s and cross the t’s and make sure that the legislation under which the Government operates and sets tax rates and collects revenue is backed by the appropriate rules being in place at the right time. So it is a necessary thing to be doing.

In a general sense, we have no major issues with the broad aspects of this bill. We will be supporting it to select committee. It is unlikely, we feel, at this point that much will crop up to give us concern to the point that we would withdraw our support for it, but, as with any bill of this nature, there will be details that come to light, there will be suggestions made, and there will be perhaps things that even the officials—despite all their many hours of work in the background—have not considered, and there will be tweaks and refinements that can be made to it. At the end of the day, with input, with reason, and with support from across the House, we will, I am sure, end up with a bill that is fit for purpose and one that takes us forward.

That is important, because when we look at the criteria against which the options for change that are outlined in this bill have been assessed, they are quite simple. They are fairness and equity, efficiency of compliance and administration, sustainability of tax and income-related social policy, and a basis for improved social policy and other Government services—all of which are fine goals, and we support them.

I am intrigued by this statement, which pretty much seems a summation of the way that we need to approach these things—and which this bill appears to do. Under the heading “Proposed changes to PAYE and GST”, it simply says that taxpayers need a tax system that is easy to comply with so it is easy to get it right, and I think that is true. Everyone grumbles a little bit and resents paying tax, but I think people understand that if it is a fair amount collected in the right way, although they might not always agree with the way in which various Governments spend tax revenue, they do accept and understand that we—all of us here, voters and taxpayers—have a stake in the nation and we do have a responsibility to pay our share. If it is fair and is done simply and equitably, and in a way that does keep up with changing workforce types and with changing technology, then people are more inclined to accept that.

I do have a concern—and, as I say, I am not on the select committee—about some of the figures that have come out as a result of this, which I was not aware of off the top of my head. The PAYE system raises 37 percent of tax revenue and GST raises 36 percent, and that is two-thirds of the total Government revenue coming from, essentially, sources that—notwithstanding that there are many well-paid individuals in the PAYE system—do not involve corporates.

Of course, we have seen a lot of conversation in the media just of late about, particularly, foreign corporations—not about the amount of tax they pay but about the amount of tax that they do not pay. I am hoping that bills of this type and the structure that comes about through their passing—transparency, adoption of technology—will make it an easier task for the nation to have a look at the structure of how foreign corporates are taxed. Perhaps we can learn some lessons from the way that this bill goes through the select committee process, by which those concerns could be addressed again in a manner relating to, as I said in the earlier example, the decommissioning of oil and mining operations and so forth, so that we can look at those in a more long-term, broad-spectrum light, and so that they will also come to find a way in which they can see a simple track through the tax system and be motivated, shall we say, to provide a fairer share of Government revenue relative to the amount of business they do.

With those comments, I do not wish to tie up too much of the time of the House. As I say, we will be supporting this bill through to the select committee, and very probably beyond, and I imagine that my colleague will be very much looking forward to going through that process in the committee. So I commend this bill to the House. Thank you.

BRETT HUDSON (National): I rise in support of the Taxation (Annual Rates for 2017-18, Employment and Investment Income, and Remedial Matters) Bill—and that is quite a mouthful. It has been said, time and again, that the two things that none of us can escape are death and taxes. That is why it is so important that we continue to focus on getting taxation matters, treatment, and processes right, here in New Zealand. I have only just had the recent fortune of joining the Finance and Expenditure Committee, and I am actually very much looking forward to going over this bill in the select committee.

It is amazing—I think members, probably, from across the House will have seen this, but we are all pretty much involved in our electorates with, particularly, party members. One thing that is for certain is that as soon as you hold a policy discussion on matters pertaining to taxation, everyone comes out of the woodwork with ideas as to how we can run our system more efficiently, how we can use it to generate the sorts of behaviours we would like to see from people, and how we can make their lives simpler through the application of taxation compliance, collection, and processes.

I am particularly interested in looking—as we go through the PAYE changes that will see business employers having to submit, electronically, the details around their employees in a more timely way, at the time of the pay runs. I am interested to see whether that can help us to help those employees who may have more than one job and who often have issues, or have had issues in the past, with secondary tax payments at the end of the year causing a large balloon payment and causing them some angst. I just wonder whether we might be able to use this change, while it might not have been intended for that purpose, in a way that helps those employees with that obligation in being able to meet it in a way that is much easier for them to manage in their lives.

I am also very pleased to see the work that we are doing around employee share schemes and the way that these would be treated as income, both from the employee’s perspective but also for what it means from the employer’s perspective. So I am very much looking forward to this bill progressing through select committee, and I commend it to the House.

GARETH HUGHES (Green): Kia ora, Mr Assistant Speaker. Ngā mihi nui ki a koutou, kia ora. As everyone knows, tomorrow is Budget day. If there could be a perfect entrée for a National Budget, I would wager this bill was it. What is it? A small, innocuous, non-strategic, and entirely technical bill to tweak around the edges, avoiding all of the big issues regarding tax in our country. That is exactly what we are going to see in tomorrow’s Budget. We have seen nearly 9 years of it—a Government that is prepared to kick the fiscal, the economic, and the social issues down the road, and ignore the big issues.

Once again, in this, the Taxation (Annual Rates for 2017-18, Employment and Investment Income, and Remedial Matters) Bill, it is the same thing. What do we see? We see some small technical changes around how tax is recovered from petroleum companies, Lloyds, and big farmer/employee share schemes. But they are ignoring the big issues.

Let us just focus on one area, the petroleum changes. Currently, here is an area where petroleum companies, when they decommission their oil rigs, have an existing tax regime where they can go backwards in terms of their losses. The Government is trying to change it.

Why the Government is trying to change it is that, as we recently uncovered in an Official Information Act request to Judith Collins, the Minister of Energy and Resources, the Government is looking at a 42 to 48 percent taxpayer liability—up to $960 million relating to their obligations to oil rig decommissioning. I was absolutely shocked, and I think the Minister was too when she saw the scale of the taxpayer public liability—up to $960 million, because the taxpayer has to fork out 42 to 48 percent of that liability. We are making a tiny technical change around it, but avoiding some of those ginormous issues facing not only the environment, from climate change, but particularly the fiscal impact on taxpayers.

That raises the second question. Why on earth is the taxpayer subsidising one of the most profitable industries on the planet? What I am referring to is the $46 million annual tax breaks and subsidies estimate produced by the World Wide Fund for Nature. Why on earth is the taxpayer subsidising big oil $46 million a year? We have got a wealth of clean energy resources that could be growing four times more jobs—well, that is according to the official estimates. But instead we are looking back to the past.

When we talk about tax, we are talking about tiny technical changes on the margins and no doubt this is exactly what we will see tomorrow. Why on earth are we not using Parliament’s time right now to debate the big issues, like a capital gains tax on other than the family home? We saw last week that the International Monetary Fund said that the housing market and the bubble there was the biggest fiscal risk to our economy.

The ASSISTANT SPEAKER (Hon Trevor Mallard): Order! I have sort of waved the bill around towards the member on a number of occasions, suggesting that he might want to address it. The first reading debate is a relatively narrow one. Large discourses about what is not in the bill and what should be done are not relevant.

GARETH HUGHES: I did appreciate the visual prompts, Mr Assistant Speaker.

The ASSISTANT SPEAKER (Hon Trevor Mallard): Well, it would be good if the member took notice as well.

GARETH HUGHES: There is a lot that could have been in this bill, that we should have been discussing but we are not. But when we talk about the petroleum part, which we will be looking at in detail in the select committee, I note the regulatory impact statement produced a number of options. I think the preferred option, which unfortunately was not taken into account, was the idea of an environmental restoration account. That way, an account could have been built up over time.

As I outlined, the fiscal liability for the taxpayer is significant. As I questioned the Minister in question time, she referred to the fact that these companies pay taxes and there are royalties going into the Crown account. While that is true, the fact is that that money has been spent. As I asked the Minister, when it comes to the tax liability that the taxpayer faces, none of that money has been put aside.

There are a lot of really important things that have a call on the taxpayers’ income—for example, housing and benefits. But because none of that money has been put aside into, for example, an environmental restoration account, the taxpayer has got to come up with it. So we will be asking lots of questions as to why the changes that are in the legislation were picked by the Government, and why the environmental restoration account, which was identified in the regulatory impact statement, was not adopted. Why was this gigantic sum not flagged earlier to the Minister? It was never in any other briefing documents. There is a lot of detail that we want to go into. We urge the public to make submissions to the select committee. Thank you very much.

PEENI HENARE (Labour—Tāmaki Makaurau): Tēnā koe, Mr Assistant Speaker. I rise to take a call on the Taxation (Annual Rates for 2017-18, Employment and Investment Income, and Remedial Matters) Bill. I want to just briefly echo the sentiments of colleagues across the House about a tax system that is robust and that is fit for purpose. While it is very prescriptive, it is also agile to the ever-growing needs of Aotearoa New Zealand.

Many of the members across the House have focused on different matters in this particular bill. I want to focus in particular on the fact that the bill proposes that payers of interest, dividends, and taxable Māori authority distributions will be required to provide detailed recipient information to the IRD on a monthly basis. The bill proposes a new model for the collection of information on the part of the IRD. I wonder also about the introduction of the big changes to Te Ture Whenua Māori Bill, which might seem quite separate to this, but all of those Māori authorities and Māori entities operate under that particular legislation.

When it comes time for Māori authorities to pay dividends, to make distributions to their beneficiaries, it is always quite a difficult time for Māori entities. I, for one, have been an administrator of Māori entities. Besides the practical challenges in connecting with beneficiaries, just the mere fact of paying out a distribution is very hard. What we know and what I have experienced is that for every dollar that you pay, it costs almost another dollar, if not slightly more, in compliance—not just for tax but also for administration purposes. I wonder, when I look at this particular bill—one of the parts of it is asking for more frequent, more comprehensive information from Māori entities to inland revenue, on a monthly basis. It also provides a provision that says it is optional for those Māori entities on 1 April 2019, but it will be compulsory the following year, in 2020.

With the big changes coming with Te Ture Whenua Māori Bill, which is currently in front of the House, a lot of the challenges around compliance will be around the fact that Māori entities will need to have a better engagement with their beneficiaries. While that might sound like an easy thing to do, I can tell you, as a land administrator for Māori trusts, that it is actually very hard.

I wonder, when we talk about a robust tax system—we should always be careful about heaping so much compliance on entities such as Māori land trusts and others, because, first of all, their resources are limited, and, secondly, their capacity is limited. When we consider the task that is being asked of them, through this particular bill, of providing monthly regular information for IRD records—I understand the purpose of it, but I would be interested to hear, as this bill progresses, input from the likes of the Federation of Māori Authorities and the likes of some of the large Māori land trusts that actually do pay dividends to beneficiaries.

Here is an example of just how difficult it is. If you go on to the Ngāti Hine forestry website and you look through the list of beneficiaries, if you search for a gentleman by the name of Peeni Henare, it will come up with—

Simon O’Connor: Who’s that guy?

PEENI HENARE: Oh, some quite famous fella from up north. You will find that “Peeni Henare” will come up, and he will be a large beneficiary. Then you will have a look at that gentleman’s birth date and you will find that he was born in the early 1900s. So those records are actually very, very old.

Simon O’Connor: You’re looking really well.

PEENI HENARE: Yes. You know, I did think about a vampire stint. But look, the point is this: it is easier said than done—updating that type of information. My namesake died in 1979, months before I was born, which is why I am named after him, yet his shares are still there. I wonder how that information might come across the desk at the IRD.

Just in conclusion, because I am mindful of the time, there are a whole bunch of technical changes here. We, like the Green Party, will be looking at the employment share schemes a lot closer. We are looking forward to hearing some of the submissions on those. Once again, I would encourage the Federation of Māori Authorities and other Māori land trusts to make sure that they make a submission on this bill. But otherwise, we support this particular bill and look forward to it going to the select committee.

SIMON O’CONNOR (National—Tāmaki): I am not sure how long this will last.

The ASSISTANT SPEAKER (Hon Trevor Mallard): The time has come for me to leave the Chair for the dinner adjournment.

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

Hon CLAYTON COSGROVE (Labour): I am reliably advised that the previous speaker, Simon O’Connor, who preceded me at the dinner break, made a Commonwealth record of a speech that lasted, I think, less than a minute. That may be because—and I congratulate him on his recent marriage—now that he is under the influence of a higher authority, shall we say, he has become far more efficient and eloquent than prior to the nuptials. This is yet another tax bill brought in by the Government. I note the Minister—oh, congratulations, I say to Simon O’Connor. I hope you were not late for the wedding. Anyway, this is yet another tax bill that the Government has put before us in respect of annual rates and other matters. I note the new Minister in charge of revenue, Judith Collins, is present.

As we go through this bill, I note that the first part is a substantial section that deals with the Business Transformation project and the technological changes within the Inland Revenue Department. We will give notice, on this side of the House, of one thing we will explore, and we have explored, as the IRD has come before us in various guises over the last few years—and the IRD commissioner, in fairness, has been quite forthright in respect of outlining the Business Transformation programme that the IRD is going through. But one thing that the Finance and Expenditure Committee, of which I am a member, has touched on and wanted to explore and gain assurances on is that such a wide-ranging and extremely expensive technological input is on time, on budget, and will actually work. We are mindful of Novopay. We are mindful, going back to the 1990s with the then National Government, of INCIS and other programmes.

To be fair, I acknowledge that IT programmes are particularly difficult—or they seem to be far more difficult—to manage within the Public Service than they do in the private sector. We have had many experiences, of course, of spec creep, where at the end of the day the product you actually get has a whole series of other added bells and whistles that the consultants have persuaded the department to put on it, except the difficulty is it does not work. We have seen that with Novopay. We have seen that with INCIS, as I say, in the 1990s. So I would be grateful—and give notice to the Minister that we will ask questions and seek assurances as to the nature of that programme.

I agree it is vital. It is appropriate that—for instance, the IRD, I think, only recently started communicating with taxpayers in respect of email. In the old days, the law did not allow that and you had to communicate in writing. One of the bugbears, I think—and I think perhaps some of these issues in terms of business simplification may be dealt with in part in this bill—especially that small business has, is that when there is a tax difficulty, 9½ times out of 10 with a small business, it is a mess up; it is a mistake. It is not an issue of criminality or fraud; it is just a mistake, because, in respect of most small businesses, often it is the partner who sits at home under the bad light doing the books.

In the old days, I recall with the IRD you could actually go—and it has been done away with now, essentially, but it was a highly efficient process—to the IRD and get in front of a human being, a tax specialist, with your files, and sit there. Many of us have sent people and had really good responses, I have to say, from the Inland Revenue Department in terms of sending small-business people there to solve problems. You could get in somebody’s face, you could explain the difficulty without letters flying back and forth through accountants and other representatives costing an immense amount of money, and you could get the problem solved. Sadly, to a large extent, we do not have that ability for a business to make an appointment and see a human being. It has to go through the call centre, all these wonderful automated processes, which are great, but if you are a small-business person out there and you are a specialist in making a widget or installing a product or whatever—that is your total focus—anything that gets in your way, especially trying to deal with your tax arrangements, can be laborious, and many small-business people would admit that they do not have the skills to do that. Equally, they do not have a lot of money often to go and just take the briefcase full of receipts and bills and bits and pieces, hand it to the accountant, and say: “Can you sort it for me?”.

So my hope in respect of the Business Transformation project and my plea to the Minister would be this. As we drive for wonderful technological efficiency and wonderful technical innovation, often with Government agencies many of those innovations are fantastic when it comes to the productivity, the efficiency, and the ease of doing business for the agency. Often there is a gap between that and the practical effect, and we lose touch with the practicalities of the customer, the client, the taxpayer, the small-business person actually having to interface with the bureaucracy and interface with that technology. Not every small business is on Mind Your Own Business (MYOB). Not every small business can afford automated processes that will, at some point, plug into the IRD’s Business Transformation programme. Many small businesses still get the ledger book out, because that is what they do. As I say, I hope that in this wonderful transformation that there will be some thought or has been some thought given to the practical application for that small individual called the taxpayer, the client, the customer.

In respect of the costs of that, it would be helpful, I think, as we go through—and as this bill is examined in the Finance and Expenditure Committee, I know, under Mr Bishop’s sound stewardship, we will be asking for justification in terms of cost. There are hundreds of millions of dollars utilised within this transformation programme. We also know about the budget for the Business Transformation programme under a number of Ministers. The longest-serving revenue Minister in the history of any Commonwealth Parliament, I believe, the Hon Peter Dunne, presided over it at a time when there was a cost blowout. We found out about that, of course, only when the Hon Todd McClay got the high ball. “Mr Head-High Tackle” got the department under his portfolio and we actually found out that there were some difficulties with this programme, and that the budget had blown out, I think, by several hundred millions of dollars. I think I debated that when I was our revenue spokesman some time ago.

The torch has now been passed to the Hon Judith Collins, and I know that in her own colourful, diligent, and snappy way—

Hon Ruth Dyson: Modest. Humble.

Hon CLAYTON COSGROVE: “Modest. Humble.”, Ms Dyson says—and with the ability to crack the whip, I am sure the Minister will be all over the expenditures, and she will be asking her officials at her weekly meeting: “Is it on time? Is it going to work? Is it on budget?”. And I hope that if her officials, as other Government agencies have done—i.e., Novopay—come to her and say “Oops, sorry, Minister. We have given you a series of assurances but now we have got a problem and we need a few more pingers, a couple of hundred million bucks more, perhaps.”, or whatever, she may go back to them and say: “No. This is the commitment you made. Take it out of your baseline.”

Perhaps a bit of fiscal discipline around those sorts of projects—particularly Novopay—may have focused the minds of those who administer them, because there is another difficulty, I think. I have never been able to understand why certain Government agencies, unlike the private sector, can contract—particularly for IT projects—can procure them, but somehow lose control of them. When they do not work, again, unlike the private sector, which would go and either sue or have a very tight contract so it could gain recompense or compensation and pursue the supplier, for some reason our procurement standards or our procurement policies—Defence, I would say, is another one that has had an interesting and colourful set of experiences over the last 20 years, particularly around boats and other things—are such that the taxpayer cannot get recompense. The contract is too fuzzy, too muddled, too complicated, and we cannot actually nail down who is responsible.

The average person looks at these sorts of arrangements and says: “Well, if I buy a car and the car does not work, I am entitled to a new car or my money back, and perhaps some compensation for my time and suffering.” It is a very simple principle. It actually works in the private sector reasonably well, but, for some reason, we get into such a tangle with these sorts of transformation and technology projects that often the poor old taxpayer is left holding the bill, but, of course, then there is a question of accountability.

We will support this through, as we always do, in respect of tax bills. I look forward to a robust examination of the features therein.

Bill read a first time.

Bill referred to the Finance and Expenditure Committee.

Bills

Land Transport Amendment Bill

Second Reading

Hon SIMON BRIDGES (Minister of Transport): I move, That the Land Transport Amendment Bill be now read a second time. The Land Transport Amendment Bill has six parts. The bill will enable innovative small passenger services to operate and deliver benefits to consumers while managing safety risks. It will also introduce mandatory alcohol-interlock sentences for repeat offenders and first-time drink-drive offenders with high alcohol levels. The bill will create more effective deterrents to reduce the number of fleeing drivers. It will also strengthen the framework managing evasion of public transport fares. It will create opportunities to increase productivity of heavy freight and passenger vehicles. Finally, the bill will make a range of minor amendments to make sure that the Land Transport Act is clear and operating as intended.

I want to thank the members of the Transport and Industrial Relations Committee for their work on the bill. I also want to thank those who took the time to make a submission on it. The committee’s report includes many sensible recommendations that will help ensure the bill achieves its objectives.

Small passenger services: the bill, together with amendments to land transport rules and regulations, will overhaul small passenger services by removing outdated provisions and bringing the sector into the 21st century. Safety will be maintained in the future system with the retention of the P endorsement, certificate of fitness, and work-time limit requirements. Although mandatory signage is being removed, small passenger services will still be required to have a transport service licence card displayed in their vehicle’s window, and drivers will still have to display their driver identification cards.

The changes are intended to encourage innovation and better services, while managing safety risks. There is already scope for the use of electronic logbooks, and I encourage the industry to take the opportunity to implement this and other technology to improve services. As reported back from the select committee, the bill contains several changes that will help ensure that the new system for regulating small passenger services can be implemented effectively.

As I said, it also deals with alcohol-interlock sentences. This is another important part of the bill, and it ensures the alcohol interlocks are a highly effective tool for reducing the incidence of recidivist drink-driving. To increase their use, the bill proposes to make alcohol interlocks mandatory for high-risk and recidivist drink-drivers. As reported back, the bill contains three changes that will help balance the desire to have as many qualifying offenders as possible using alcohol interlocks, with other policy considerations. These changes relate to the way in which alcohol-interlock sentences apply when being considered alongside other concurrent offending; the resentencing of offenders to an alcohol-interlock sentence if grounds for an exception no longer apply; and extending the distance-based exception from 30 kilometres or more to 70 kilometres or more. The greater use of alcohol interlocks by high-risk offenders will help improve road safety outcomes and support the Government’s road safety objectives.

Fleeing drivers: the bill will also increase the penalties for drivers who fail to stop for police. Increasing the penalties for fleeing drivers will send a clear message that this behaviour is unacceptable and will not be tolerated. As introduced, the bill would have extended the ability of an enforcement officer to impound the motor vehicle where the enforcement officer suspects on reasonable grounds that the owner, person in lawful possession, or hirer of the motor vehicle knows the identity of the driver who has failed to stop for police and the person has failed or refused to provide information, or has provided false or misleading information in response to a police request for this information.

In his report under section 7 of the New Zealand Bill of Rights Act 1990, the Attorney-General concluded that this creates an inconsistency with section 21 of the New Zealand Bill of Rights Act, the right to be secure against unreasonable search or seizure. To address this inconsistency, the revised bill reported back from the committee relies on the existing power available to police to impound a vehicle if they believe on reasonable grounds that it has been used in a fleeing driver incident. The Attorney-General has advised that he is satisfied that the revised bill has addressed the inconsistency of some of the fleeing driver provisions with section 21 of the New Zealand Bill of Rights Act. What a wise man indeed.

Fare evasion provisions are also in this bill. Another important part of the bill is that it strengthens the legislative regime for managing public transport fare evasion by giving enforcement officers new powers to require passengers to provide evidence that they have paid a fare, provide their contact details when a valid ticket is not produced, and/or order a passenger to disembark the public transport service. As reported back, the committee has ensured that the bill is futureproofed by amending new section 79M(4) to remove reference to ticket vending machines. Clause 31 has also been struck from the bill because it is now considered redundant.

The bill also complements the recent changes to the vehicle dimensions and mass rule and corresponding regulations, by making technical amendments to clarify existing provisions, address operational enforcement issues, and correct anomalies.

Finally, the bill includes a range of minor amendments to clarify interpretations or the intent of the legislation, improve its operation, remove inconsistencies, and make minor technical adjustments, with the committee making a series of changes here that I will not go into, given the minor and technical nature of them. But worthy work it was, indeed, from the committee.

The bill includes other minor and technical changes that I have not explicitly covered. These changes are, of course, set out in the committee’s report. They are consistent with the overarching objectives of the bill, which are to provide better regulation for a more effective, efficient, and safe land transport system. I am proud of this bill. I think it futureproofs our land transport regime, and I commend the Land Transport Amendment Bill to the House.

SUE MORONEY (Labour): I rise to respond to the speech just given by Minister Simon Bridges, the Minister who should really be spending his time this evening wondering why he did not pay more attention to the fraud happening in the Ministry of Transport. But, instead, he is talking about this series of changes. The Land Transport Amendment Bill will be supported by the Labour Party, but with serious reservations, actually. If I can say at the outset, many of the technical changes that the Minister described before are things that will make a small amount of difference. They are sensible. They are practical.

In particular, we want to support the mandatory sentences for alcohol interlocks, which is something that we think will improve this Government’s poor record on the road toll, which has started increasing—it now looks like this year will be the fourth year in a row that the road toll will increase, against the trend of decades of coming down. In fact, it is against the international trend where other countries similar to us are experiencing their road tolls coming down year after year. Under this Government’s regime, we have got the opposite happening with the road toll going up, and all of the grief and tragedy that that causes for the friends and family of the deceased. So the alcohol-interlock measure in this bill will be an improvement to road safety, as are some of the provisions about overloaded trucks. Although, I have got to say, that if the Government was really serious, it would not keep introducing larger and larger trucks on our roads, which just are not fit to carry those larger trucks, therefore increasing the incidence of crashes and fatal crashes on our roads.

So there are many areas that we do support. The area that was probably the most contentious, though, of this bill was the bit about the small passenger service vehicles. This is the part—and I think the intention is correct, which is to ensure that as technology improves and changes, some of those new services are now captured and that there is a level playing field that is going to be presented. That is admirable in its intent, but I am not sure that this bill actually brings that about in a very safe way, because it is my view and it is Labour’s view that the role of this Parliament when it comes to small passenger services—and these are not services for small passengers; these are small passenger vehicle services—is to ensure public safety. That is our primary role. The Labour Party does not feel that this bill goes far enough in doing that, so we have some amendments that we will be proposing at the Committee stage, and I am going to outline them now.

The two areas of most concern to us exist around the removal in this bill of Braille signage and, also, the removal of the requirement for in-vehicle cameras. These are two major public safety issues. The reason why we are so concerned about public safety is that we know that the track record of deregulation under National Governments has caused this country great grief in the past. We have only got to think about the Pike River mine, where a National Government deregulated and removed mining inspectors, and that was a significant cause of what happened at the Pike River mine. We have only got to think of the thousands of New Zealanders whose livelihoods and lives have been affected because they have weather-damaged buildings—houses—because the weathertightness is not correct, because, again, a National Government deregulated the building industry and the standards and, therefore, we ended up with a leaky-homes crisis in New Zealand. We have only got to look at those two examples to know that we have got to be very careful when a National Government deregulates in the way that this bill in fact does.

Deregulation is the catchcry of a National Government. National members love deregulating, but they ain’t so keen to put their hands up to actually be accountable for the results of it. With small passenger vehicle services the fact is that people who are using the services—apart from MPs who are using taxis and maybe Ubers from the airport and back to Parliament, but, for the majority of people they are using these services when they are impaired one way or the other. In fact, the largest number of submissions that we had on this bill came from people who were from organisations that were representing people with disabilities, because they are utterly—in many cases—dependent on these services for every movement that they make. They do not have the ability to drive themselves, and, often, taking public transport is not an option for them either.

So they are utterly dependent on this service, and these services need to be safe for them because they are extremely vulnerable. That is the reason why we want to ensure that the requirement for Braille signage is not stripped out of these services, because people representing those who are sight-impaired told us how important that was for them to have certainty over what vehicle they were in so that if anything untoward did happen they could report it. That was something that was very important to them for their security.

But the other group of people, of course, when we talk about impairment is often people who are using these services because they have been out and they have had a bit too much to drink, or they have certainly had too much to drink to drive themselves home, or they may be involved in other substances, and they are using these services. Again, they are very vulnerable when they are in those situations. So this is the reason why we are insisting and asking this Parliament to back our call to ensure that the current provisions for in-vehicle cameras remain. After all, those provisions were brought in only in 2011. That is not very long ago. It was the National Government that put that requirement in place. Why did it do that? Well, it did it on the back of two vicious murders of two taxi drivers: Hiren Mohini in 2010 and Abdulrahman Ikhtiari in 2008. Those two men were brutally murdered. They were taxi drivers, and those murders led to the decision by this Parliament to insist that in-vehicle cameras were installed in certain circumstances.

The Government may well argue that that is no longer necessary because new technology is going to fix all this and it is going to be all fine because, you know, you are going to use your app, and you are going to dial up the Uber or the taxi, and they are going to know who you are and you are going to know who they are, so it is all sweet—except that we had a man come and do a submission to our select committee. He came into our select committee and said: “I’m Rod Stewart.” He clearly was not Rod Stewart, but he had been able to register himself as an Uber driver using the rock star Rod Stewart’s actual photo and calling himself Rod Stewart. Uber accepted him as being Rod Stewart, you know, with the hair and all. He clearly was not Rod Stewart; he looked completely different to Rod Stewart. I do not know what his singing voice was like—he did not demonstrate that to us—but you could see that he was not Rod Stewart. However, he was able to become an Uber driver as Rod Stewart and pick people up as Rod Stewart. They did not say “Hey, you’re not Rod Stewart.” when they got in the car.

But, worse than that, he actually then lodged a complaint against himself as Rod Stewart. He lodged a complaint against himself, and he still was able to keep driving Ubers. Nothing happened. So I think this shows us the folly of relying entirely on new technology to give us an assurance of public safety. It clearly will not do that. Since the 2011 amendment that brought in the in-vehicle cameras, not only have we not had any murders happening in taxis but, in fact, the findings were that just 2 years later the number of violent incidents that have happened in taxis dropped by 40 percent, simply because the in-vehicle cameras were there. So this is something that we should be embracing, not getting rid of, and that Government, I fear, is going down its good old deregulation track again, where deregulation becomes the captain to it all and it forgets about public safety.

Thank goodness for the Labour Party, because we are here to remind it that our job in regard to regulating these services is public safety first—public safety first. If it means a little bit of compliance cost, public safety comes ahead of that, because that is the mistake that was made in the Pike River mine, where safety was put behind compliance costs. It was also the mistake that was made with leaky buildings. So let us please learn from those mistakes and not repeat them, and let us get it right this time round. At the Committee stage I will have those two amendments to put forward. I do believe that they are things that will make a considerable difference to public safety as we move to ensure that there is regulation across the board that captures all of those services.

The other thing that I want to say is that the media had a little bit of mischief during our select committee process and pretended that the problem with MPs is we just did not know what an app was—you know, those of us who are on our cellphones all the time do not know what an app is, do not know what Uber is. Despite the fact that Uber staff are in our offices pretty much all the time telling us exactly what Uber is, and that they came to the select committee and told us several times over what Uber is, apparently we are just a bit thick and we do not know what Uber is—absolutely untrue. But what we do—

Mr DEPUTY SPEAKER: I am sorry to interrupt the member, because I was interested to hear the end of the story, but your time has expired.

Sue Moroney: Maybe Committee stage.

JONATHAN YOUNG (National—New Plymouth): Yes, maybe at the Committee stage Sue Moroney can carry on with her story. I just have to say a couple of things regarding Rod Stewart. Rod Stewart is quite a common name, I am sure there are plenty of people around the world who are called Rod Stewart—

Sue Moroney: Who look like that?

JONATHAN YOUNG: —and no doubt there are plenty of people who dress up like Rod Stewart, as well. So to say that that is—

Mr DEPUTY SPEAKER: Here’s one.

JONATHAN YOUNG: Not you, Mr Deputy Speaker. But to say that that is a reason why there are objections to this bill is ludicrous.

In terms of safety, this was a big, big issue that, of course, the previous speaker raised. I remember on one journey from my residence to the New Plymouth airport, I spoke to the taxi driver and I said “You’ve got this Braille sticker on the side of your car, so tell me about that. Who uses that?”, and he said: “Yes, there is a person who uses it, who hops in my car every week, and it is the same person every week.” It is the same person every week. He said “He is a regular customer.”—and, look, the reality is that people who have some degree of impairment most often use the same driver. The companies understand their need. The companies provide a personalised service, and good on them for that, because that is caring for their customers. There is a huge connection between those drivers and their customers. They know each other by name.

When it comes to using, for example, a company like Uber—and when I was overseas, I used Uber a number of times. On your app—which can speak to you, by the way; it can talk to you if you have a sight impairment—is the name of the driver, their rating, the identification of the vehicle, and the type of vehicle, so there is ample acknowledgment of identity in terms of the people you use. So what this bill is doing is not minimising or disregarding safety of the public or safety of the drivers, but it is responding to technology that is already amongst us and that people are wanting to utilise.

I understand that as you read the Labour minority view in the report, it acknowledges that there are benefits around ride sharing, or benefits around some of these modes of private transport services, that will reduce congestion and reduce issues around environmental pollution. So in many regards, I think that what the member—and, you know, kind regards to her for caring for people, but I do not believe that this bill puts in jeopardy public safety, nor does it put in jeopardy driver safety. Even though that mandatory legislation regarding video cameras in taxi-cabs was put in place, it still remains the choice of taxi drivers, if they want that technology in their cabs, to put it there. So if they want to have that degree of, I guess, backup in terms of their safety about the identification of their customers and clients who travel in their taxi-cabs, they can still do it, and the price of that technology has reduced, as we know. All technology is reducing in cost.

So I think that the comments of the Opposition—and I appreciate that the Labour member and those members of the Transport and Industrial Relations Committee are, by and large, supporting this bill. But I do think that their objections do not warrant the level of concern that they vocalise.

So I am keen to speak on many other aspects of this bill, and I am going to do so when we have a little bit more liberty around the time in the Committee stage. But I believe this Land Transport Amendment Bill takes us forward into the world. The future has already come our way and is meeting us, but the bill brings legislation into place that puts sensible regulation around those advancements and those technology opportunities and advantages to our society. So I am very pleased to stand in support and commend this bill to the House. Thank you.

IAIN LEES-GALLOWAY (Labour—Palmerston North): As my colleague—

Peeni Henare: It’s Rod Stewart.

IAIN LEES-GALLOWAY: —definitely not Rod Stewart—Sue Moroney has said, we support the bill overall, but we do have some reservations about it. We support the bill because the fact is that ride-sharing technology apps like Uber—Uber is not the only one, but it is the one that is most prevalent worldwide, and certainly most prevalent in New Zealand. It is the one that we hear from most often. You know, that technology is here and it has a lot of benefits.

The challenge for us is not to deregulate in response to it, but to make sure that we have appropriate regulation that allows the benefits of ride sharing and the benefits of the mobile technology that goes with it and that enables it to be most effective while still ensuring that drivers and their passengers are as safe as they possibly can be. There is a balancing act there, and, especially when you are dealing with new technology and fast-changing technology, it can be a real challenge for us to land in the right place.

On the one hand you have got the taxi drivers with their very valid concerns, and on the other hand you have got the like of Uber wanting—legitimately, I think—to be able to conduct its business and provide a new service without being tied up in unnecessary regulation, but, to be fair, perhaps overlooking some of the things that we need to do to make sure that we keep public safety as much of a priority as it needs to be.

I think we need go no further than the example of the Uber driver who, at the end of his shift, having worked a shift in Auckland, picked up some passengers from Auckland and drove them nearly non-stop to Wellington. That was a breach of the work-time requirements. I know the New Zealand Transport Agency is investigating this, and the driver claimed that he took the necessary breaks, but what is for certain is that he worked a total of 16½ hours, when the rule is you work a total of only 13 hours before you have a proper break. Because of the way the technology is set up and because of the difficulties we have in enforcing the rules when dealing with an outfit like Uber, that would never have been detected had it not been for the unfortunate circumstance—for the driver—that the passengers were so happy that they went to the media about it and he was hailed as a hero. He was hailed as a hero.

It was really obvious from the outset that it was likely that rules had been broken, that he had put himself at risk, that he had put his passengers at risk, and that he had put all the other drivers whom he came across on that journey from Auckland to Wellington at risk, and yet the initial story was “What a hero.” Well, that tells us something about our culture towards safety in the workplace and safety amongst people who drive for a living, and it tells us that there is something wrong and we need to make sure we get our regulations right.

One thing that this bill does away with—and we have decided not to challenge it—is any signage on the vehicle, because Uber drivers make the case that that is their own personal vehicle, they use it for personal use, and they do not want to go around with Uber signage all over their car all the time. The truth is that with the first Uber I ever took, when we went to put our bags in the boot, there were all the taxi signs that had been pulled off. So now it was a blank, white vehicle that we were getting into, but, actually, it was a taxi. They had just taken all the magnetic strips off the car, put them in the boot, and, all of a sudden, it was an Uber.

But if they take the taxi ones off, why can they not just pop an Uber one back on there and, hey, we know it is an Uber, and the people who are tasked with enforcing these rules have one more thing that alerts them to the fact that this is actually a vehicle that is being used in a commercial way and it needs to adhere to commercial rules? Now, yes, they have got a little certificate on their windscreen so that if you go around with a magnifying glass and you are Inspector Clouseau and you get up really close and you check to see whether that is all correct, you will know that that is an Uber. But otherwise, if it is just driving down the street, you would have no idea that it is a commercial vehicle.

We are not challenging it, but, personally, I think that that is a bit of a flaw. I understand that they are not rank and hail, that they are not going to be pulling up and sitting at taxi ranks waiting for people to get in, that they are using their own cars, that they get called up by the app—I get all of that. But from an enforcement perspective, I think it would be useful to have that on there. That is, ultimately, where I think the challenge is going to lie—not so much in the regulations themselves, but in how we enforce them, and we should make it as easy as possible for enforcement to occur. By the very nature of this business, it is going to be harder and harder for us to ensure that drivers are sticking to the rules and passengers are safe.

I understand the whole thing about how the app works—that you know who the driver is, you know who the passenger is, and everybody rates each other. If a passenger does something untoward in the vehicle, then that driver will put that on their rating and future drivers will know that, or not. If a driver acts in an inappropriate way—like another time I took an Uber and the driver took a phone call on the phone, not hands-free, whilst they were driving, I was able to report that through the app. I get all of that, but it does make enforcement of the rules an awful lot harder, and just being able to see who are Uber drivers would help.

The other thing that I think is incredibly important is those cameras in the cars. It was only a few years ago that the Government thought it was so important that taxis had cameras in the vehicle that it made it mandatory—whether the drivers wanted that expense or not, the Government made it mandatory. OK, technology has changed. We now have the ride-sharing app. That gives us an opportunity to pause and ask the question: are the cameras still important? I think they are. Regardless of what information you can share on an app, whether you are or are not Rod Stewart—if a driver can use a pseudonym, then a passenger can certainly use a pseudonym and then maybe attack the driver, or whatever—having the camera in the vehicle just provides that extra level of safety.

It actually provides safety for the passenger as well. That was the argument that was made when the Government made this mandatory; why not carry on with that argument? There is an expense attached to those cameras, but it is coming down all the time. I think the fact that the Government made them mandatory meant that there was plenty of demand for them in New Zealand, and the cost of them has come down. If someone wants to use their vehicle as an Uber, whether it is full-time or not, then installing a camera for their own safety and for the safety of their passengers is not, I think, a particularly onerous requirement. So we will certainly be supporting Sue Moroney’s amendments around that at the Committee stage.

I just want to say one last thing, and that is around the behaviour of Uber. It has lobbied for these changes. That is perfectly legitimate. Everybody has the right to come to Parliament, to come to the Government, and say: “We don’t think the rules, as they are, are appropriate for the modern environment. Let’s make some changes.” But what Uber has done in its arrogance is flout the rules as they currently are and just act as though the rules are what it wants them to be. This is the way it has operated all around the world. Frankly, the response from the Government has been weak, extremely weak.

The approach this Government takes to actually enforcing the rules in so many different areas suggests that it does not actually think there should be rules. The enforcement of requiring Uber drivers to have their P endorsement, the enforcement of requiring them to have their vehicles properly certificated, has been extremely lax. This is a Government that tells New Zealanders that it believes in the rule of law, that people should abide by the law, and that there will be consequences for breaking the law, but in the case of Uber it has sort of just gone “Oh well.” and shrugged its shoulders: “Nothing we can do about it! It’s a very difficult area to enforce. Let’s just let Uber act in the way it wants to, and, hey, we’re going to change the law in its favour eventually, so why worry about it?”.

Why worry about it? Well, because there are other perfectly legitimate operators out there—taxi drivers—who have abided by the law, and I can understand why they are aggrieved by the way this Government has approached this legislation. We support it, but it sure ain’t perfect.

Dr PARMJEET PARMAR (National): I am taking this call to support the Land Transport Amendment Bill in its second reading. This bill was considered by the Transport and Industrial Relations Committee, and when this bill was going through the select committee process, my observation was that there was a huge amount of interest in one particular part of this bill. That is the small passenger service industry provisions. If we look at this whole bill, it is quite wide ranging. It covers provisions to minimise fare evasion, to put some effective deterrents in place, to reduce the incidences of fleeing drivers, and to bring in alcohol interlocks to reduce drink-driving offences. It includes changes to heavy vehicle regulations, and also updates regulations regarding the small passenger service industry.

The select committee received 79 submissions, and we had the opportunity to hear from 32 submitters. When I say that there was a huge amount of interest from the small passenger service industry, that is based on the fact that out of 79 submitters, 54 had something to say about the small passenger service industry provisions in this bill. I can understand this huge amount of interest in this particular part of the bill, because we have thousands and thousands of people employed in this industry across New Zealand, and people, schools, hospitals, and businesses use small passenger service providers from time to time to get transported. Yes, public safety and passenger safety are important, but it is also important to see that our regulatory framework is providing effective measures for all operators to be in the sector and work where they have a level playing field.

During the select committee process we heard about passenger endorsement calls, we heard about taxi stand issues, we heard about logbook and time sheet issues, and many of these issues that came up during the select committee process are addressed in the land transport rules. This sector, the small passenger service industry, is just like any other business. Businesses want to cut their compliance costs, they want to be innovative, they want to adopt technology, and by updating these regulations for the small passenger service industry, we will be giving this opportunity for the small passenger service industry to be innovative, to adopt technology, and to have new ways of interacting with its customers and providing services to its customers.

The other thing that I believe attracted a reasonable amount of interest was the alcohol-interlock provision in this bill, and 24 submitters had something to say about alcohol interlocks. The overall view was that alcohol interlocks will prove to be an effective tool to reduce the incidences of people getting drunk and driving. This part of the bill is based on evidence. We know that alcohol interlocks will definitely reduce such incidences, and there will be more use of alcohol interlocks after this legislation is passed. On fare evasion, this is an issue that we thought is mostly seen in Auckland, so there were several suggestions made to put more effective deterrents in place to reduce fare evasion cases.

Overall, there was a huge amount of suggestions, so I want to thank all submitters for their contributions. I also want to acknowledge our select committee chair, Jonathan Young, for his leadership during the select committee process, and I want to acknowledge our Minister, the Hon Simon Bridges, as well. This is a bill that this industry, the small passenger service industry, is very much looking forward to. This bill will strengthen safety and will make our land transport system more effective. I support this bill and commend this bill to the House. Thank you.

JULIE ANNE GENTER (Green): Tēnā koe. Tēnā koutou e Te Whare. This bill, like so much that National has done since it has been in Government, is OK; it is not great, it is definitely not world-changing. There are some things that are definitely not ideal about it. When it comes to transport, I think it does some of the bare minimum things that probably should have happened a few years ago, for example, updating the heavy vehicle regulations to align with the changes to the land transport rule around vehicle dimensions.

The Green Party has not supported bigger, heavier trucks because it is not very good for our roads and it is not very good for safety on our roads, but some of the changes around vehicle dimensions have to do with accommodating the reality of passenger transport services in Auckland, particularly bus services. Fully loaded buses and double-decker buses were not able to comply with our rules. Even though we knew that it was happening, bus companies were not able to buy buses that were in accordance with the law, and the law had to change to reflect that. So we support that.

Some of the changes around strengthening the legislation covering alcohol interlocks is good, and I think the Transport and Industrial Relations Committee made that even better, because there were some issues that were raised by the Law Society and I believe the select committee made quite a huge improvement. The legislation, as drafted, would have enabled the police to confiscate a vehicle from someone just on the basis that they believed they knew who might have disobeyed the law. So there was a serious issue around people’s rights that was affecting the way the legislation was originally drafted. We heard from the submitters. We heard that there were issues around that, and we amended the law to improve it. I believe it has been improved. So we can still support that.

Most of this debate has been around the changes to the regulatory system for small passenger services to accommodate the disruptive services and technology like Uber. I have to say, when it comes to Uber, it is really good technology. What is really great about the app itself—the software—is that it enables better utilisation of the vehicles that are on the road and it means that people can start seeing car transport as just one tool in their transport tool kit. That is something that the Greens have been advocating for a long time: a much more balanced transport system, where you have got decent, reliable, frequent public transport in our major towns and cities, safe walking and cycling, which means people do not have to own a car—they do not have to shoulder that expense—but they do have access to a car when they need to use it. Uber is one example of how a car suddenly just becomes another tool in your transport tool kit. You are looking up what is the best option to get from A to B, you have got some passenger transport options—bus and train or ferry services, or walking and cycling, and you combine those. Or, at some times of the day, a car is going to be the best option.

But the issue with Uber as a company is that it is actually not a very ethical company, and although its software is very, very useful—and I do believe it will end up being implemented and adopted by other transport mobility agencies and probably taxi drivers—the way it has gone about it has been quite bad and it is eroding the wages of taxi drivers. So, you know, I think the reality is that if we get self-driving cars in the next 10 or 20 years, driving will no longer be a profession, and that is one example of how, with increasing automation, we need a tax system and benefit system that recognises that and shares resources more fairly, which is very off-topic from this bill. Ha, ha!

But the reality is that we can agree with most of the changes, because I think they have struck a good balance, but we will be supporting Sue Moroney’s Supplementary Order Papers (SOPs) when the Committee stages of this bill come up, and particularly the SOP around the requirement for Braille signage in passenger transport services. I do think this is really important. Jonathan Young gave this example of a taxi driver in New Plymouth, which is a very small town with very high car ownership and very few people using taxis. But the reality is that people who are vision impaired might rely quite heavily on taxis, and the reality is that this is not about: “Oh, well, it’s only a small percentage of people who need this Braille signage, so, on balance, we don’t think that everyone should have to pay for it.”

That is not how it works in this society. We actually want to lift everyone up to the same level. And just because someone is vision impaired does not mean that they should not have the right to know what is going on in the vehicle that they are getting into. You cannot make that kind of crude cost-benefit analysis: “Oh, it only benefits one person in New Plymouth, so we don’t really need it because they know their regular taxi driver.” Well, you could not say that in Auckland, because there is no chance in a city of 1.5 million people that somebody who is vision impaired and regularly using taxis is going to have the same taxi driver every time. That is just not how it works. There are heaps of taxi drivers in Auckland.

We heard from the Blind Foundation that it is extremely opposed to this change, and I just think that the test of a decent society is how it treats its most vulnerable people, and people who are vision impaired deserve that our laws and regulations meet their needs, at a bare minimum. The rest of us can put up with a lot of additional cost or additional disruption. We can do that because we can see and things are quite easy for us, but we should be designing the system around the people who have the greatest challenges. So the Green Party will 100 percent be supporting Sue Moroney’s SOP, and we support the minority report that the Labour Party has put in.

So, on balance, I would say that the Green Party can support the bill. We would really like to see this SOP that would look out for our most vulnerable people go through. And we would like to see some greater vision. I know the National Party try—and it is great that the rhetoric has gone there and that it is embracing technology and it is embracing the future, but the reality is that, with the overall approach to transport funding and policy, it is pretty far behind and it is still orienting everything around private car ownership. The vast majority of the transport budget is going on a few extremely expensive stretches of highway. We have not actually seen National embrace technology and the reality that cities are most effective when they are designed around people, not cars.

The Green Party will continue to advocate for our transport policy, which would probably actually be incredibly popular with everyone in Auckland and our other major cities—but particularly in Auckland, I think, people have realised. No matter who they vote for, they support Green Party transport policy because we have realised that the only way to enable people to get around Auckland now is to invest in public transport. National has, sadly—I know not all of their members agree with this—due to Steven Joyce as transport Minister from 2008-11—

Mr DEPUTY SPEAKER: Stick to the bill, please.

JULIE ANNE GENTER: —gone down the route of spending most of the money on private infrastructure that supports private car ownership but actually results in a whole lot more congestion.

The Green Party supports this bill. We believe it could be better and that National could do a whole lot more for transport in this country if it embraced a more balanced approach to transport spending.

DENIS O’ROURKE (NZ First): New Zealand First will not support this bill further. We do support, of course, some of its purposes though, and mandatory disqualification for drink-driving offences and, especially, indefinite disqualification for repeat drink-driving offences are some things that we would definitely support, and also the offence of failing to pay for bus or train tickets, which has become a pretty large problem, especially for rail services in Auckland. We would definitely support that as well.

Concerning the impounding of cars of fleeing drivers, we do agree that it is necessary to delete the proposed provision because it is inconsistent with the New Zealand Bill of Rights Act, and that is in respect of the right to be secure against the unreasonable seizure of property. In any event, it is already possible for vehicles to be impounded under section 96(1AB) of the Land Transport Act, which has the power to impound vehicles for up to 28 days for failing to stop. So that is already there, and it is a serious issue because fleeing drivers were involved in 29 deaths in the 5 years to 2014-15 and 2,735 fleeing driver incidents were recorded in that year alone. That is an increase, in 1 year, of 371. So it shows that this is actually a problem that is getting worse and worse. New Zealand First would like to see the police use those powers that they do have more than they currently do. This is an offence that has to be stamped out.

When it comes to small passenger services, however, this is the part of the bill that New Zealand First cannot support. We do agree, of course, that it is silly to have separate rules for taxis and Uber services and others involved in the industry. One set of regulations ought to mean a level playing field, and we support that. But that does not mean that we have to lower standards to provide a carte blanche for Uber services. In that respect, we say in New Zealand First that the taxi-driver industry does have a valid complaint, relating to the wholesale lowering of standards across the board that this bill will inevitably result in. That is especially in relation to the safety of passengers and drivers.

It does seem that this is a price that the Government is willing to pay in order to have and encourage Uber services, but we in New Zealand First say: “Safety first.” We say the safety of drivers and passengers comes before that. We agree with the accusation made by the taxi drivers through their organisation that Uber drivers have been getting away with blue murder as far as the services that they provide without compliance to the current regulations are concerned; whereas, on the other hand, the taxi drivers actually have a very fine record of compliance, and we should be encouraging that and not discouraging it.

Following the Transport and Industrial Relations Committee process, Uber drivers will now be required to obtain a P endorsement, but they should also have to do what taxi drivers are now required to do. One of those things is to have a good standard of English. I would have thought that is absolutely basic for a passenger service provider—absolutely basic for that. Another is an area knowledge test, something that is also absolutely basic for somebody who drives people from A to B. How on earth can they provide a proper service without doing that? Those are the things that are being removed by this bill, all to accommodate Uber.

Another issue is the removal of mandatory signs on and in vehicles. We say they should stay. Uber vehicles should have the same mandatory signs on and in their vehicles as taxis now do. After all, the signs on the exterior of vehicles could easily be removable, in this day and age. Magnetic signs are very easy to obtain, and that could be done without any inconvenience and with very little cost to the Uber drivers. Passengers need to know that a vehicle that is providing a transport service is an authorised passenger service. People are entitled to know that, and they will not know that if the vehicles are not signed. In addition to that, it assists vehicles in being identified as such, so that enforcement when necessary can easily be carried out.

We also deplore the deletion of Braille signs. I could not believe my ears when I heard Jonathan Young say that because of his experience in his home town, where apparently he thinks that only one taxi with Braille signs in it should be needed—well, surely, he has been to larger towns than that, where there are a lot of people who need that service, and all vehicles should be required to have Braille signs inside them. After all, how difficult is that to do? There is very, very little difficulty, and very, very little expense, in comparison with the huge benefit for sight impaired people.

The same applies to interior security cameras. Passengers like that idea, and, most of all, the drivers like that idea, because it is a safety measure and it provides a record of events that would not otherwise be available—a well worthwhile thing inside taxis as they now are. Why should Uber drivers be exempt from that? Is it the expense? Is it inconvenient? Or do they just not like it in there for some reason? I do not understand why that is being deleted by this bill. It just does not make sense, and it is another reason why New Zealand First will vote against it.

We also regret the loss of the approved taxi organisations—because that is what it will be—which ensure compliance and the maintenance of standards and compliance with regulations. The loss of those is going to mean a loss of standards across the board, especially when it comes to the safety of passengers and drivers, all because Uber could not comply with that. So, as a result, we are going to see the demise of those organisations, and that is a sad thing, because it means more drivers taking risks and cutting corners. It is not something we should be agreeing to, and yet this Government is doing it just to make sure that we get these Uber services. It will do anything, apparently, to do that.

We say in New Zealand First that this country is not yet ready for a free-for-all Uber service in the way that you see operating overseas, and that is what this bill is going to do. It is going to do that. It is going to lower standards, and that is all because the Government thinks we need to accommodate Uber. Well, actually, Uber needs to accommodate our legal system and our standards. We deplore that these safety levels will be reduced, and we deplore also, by the way, that Uber takes profits from New Zealand to benefit overseas owners. That is not the case with most taxi providers.

However, having said all that, it sounds pretty anti-Uber, but in fact New Zealand First is not anti-Uber. In fact, all we actually want is a fair deal for taxi operators. That is not what the parties that are supporting this bill apparently want. All we want are these things, and they are pretty simple—they are pretty simple to provide: first of all, exterior vehicle signage; interior security cameras; interior information in Braille; a P endorsement for Uber drivers, as well as for all others providing a passenger service; an English language test; and an area knowledge test. Not until we get those things are we actually going to get a genuine level playing field and a transport system for small passenger service vehicles that will be sustainable, that will be safe, and that could be supported by all parties in the House.

Without those things, New Zealand First will not be voting for this bill, because it is substandard. It is substandard in terms of safety and it is substandard in terms of providing the great level of service that taxi drivers have built in this country over many years. That is all going to be destroyed, simply because this Government has had its arm twisted up its back by people who want to provide Uber services. Well, they should be coming to the party and providing the level of service and safety that our standards currently demand—nothing less. We will be voting against.

Dr JIAN YANG (National): I rise to support this bill. This bill aims to promote safety. First let us say that it will strengthen the regulations relating to alcohol interlocks, to make the alcohol-interlock programme mandatory for repeat and very serious first-time drink-driving offenders. Also, it will increase the penalties for drivers who flee police and for those who provide false information or refuse to provide information that may lead to the identification of the fleeing drivers.

I am particularly concerned about road safety, because we do have a large number of vehicle crashes in New Zealand. I had a look at the 2015 calendar year: we had 291 fatal road crashes, 9,446 injury crashes, 319 deaths, and 12,270 people injured. So these numbers are quite high. Of course, each death and each injury will cause huge emotional and financial harm to families, and also, broadly, to societies. We have here the Social cost of road crashes and injuries. Basically: “Road crashes impose intangible, financial and economic costs to society. These costs include reduced quality of life; reduced productivity; medical and other resource costs.” So, if you convert this into the actual dollars, the numbers are very high. For example, here the updated value of statistical life is $4.14 million per fatality at June 2016. So it is particularly important for us to strengthen our regulations to promote road safety.

This bill also aims to promote greater economic growth and, also, productivity by introducing a new regulatory framework for small passenger services. It will enable innovative small passenger services to deliver benefits to consumers while managing safety risks. It is important for us to make changes to accommodate the advance of modern technology. Smartphones have been so popular and it is so easy for us to use, for example, Uber, so it is important for us to have an updated regulatory regime for small passenger services. A better management of small passenger services would potentially have the benefit of managing congestion and, therefore, has the potential to improve the productivity of our economy. So I commend the bill to the House.

Mr DEPUTY SPEAKER: David Clendon—a 5-minute call on behalf of the Green Party.

DAVID CLENDON (Green): In this short call I would just like to touch on a few provisions of this bill. I do not know it well; I have not been on the Transport and Industrial Relations Committee, but a few things jump out. One of them is the changes made to the enforcement of weight limits on heavy vehicles. It enables police to more easily require overloaded vehicles to be offloaded, and it increases the penalties for taking overloaded, heavy vehicles on the road. Those are good things, in terms of safety and protection of our roads. It is interesting, though, that in the first reading the Minister introducing the bill, Craig Foss, talked about the introduction of more productive freight vehicles. Certainly, allowing larger, heavier vehicles on the road is, in a sense, more productive. It is better for the vehicle operator and, perhaps, for the customer, but it is a classic example, actually, of socialising cost and privatising profits. The impact of those extremely heavy, large vehicles on our roads means a much higher maintenance bill for the taxpayers, traded off against the benefits to the vehicle operators. It is an unfortunate compromise.

There is this wonderful technology called trains, which this Government seems somewhat oblivious to. They are tailor-made and wonderfully designed for carrying large loads over long distances at relatively low cost—social, economic, and environmental. Unfortunately, this Government has gone down the road of bigger trucks, more impact on our taxpayer-funded roads. This bill takes one small step to improving road safety and enforcement, but a much better proposition would have been heavy investment in rail transport.

This bill also does something interesting in the fact that it enables police to better monitor and enforce regulations about weight limits on bridges. It seems there was a little bit of an ambiguity in legislation, and so the possibility of prosecution and enforcing load limits on bridges was much reduced. That is an unfortunate reality, of course—collapsing bridges is something we do not want. So it is a good thing that the Government is now tidying up that little corner of the law. Living in Northland, bridges are something quite close to our heart, of course. There was that one shiny moment of hope when we thought some of our old, single-lane, broken bridges might actually be replaced—10 of them, in fact, if I recall. Sadly, not a spade has been in the ground. We continue to manage with single-lane, tired, broken things. The promise was cheap. Unfortunately, it turned out to be just that—a promise. One day, perhaps.

More seriously, I would like to reference the provisions in this bill that allow for more available use of alcohol interlocks on cars. I think it is probably a good thing that people who are busted drunk-driving for the first time who are seriously over the limit can be obliged to put alcohol interlocks on their car for a period of time. After that has expired, they can then apply for a zero-alcohol licence for a period of, perhaps, 3 years, before they are trusted again to be drivers just in the normal sense of the word, with a standard licence. That is a good thing. If a person does that once—offends a drunk-driving law once—their behaviour is likely to be changed by that serious inconvenience of cost of the interlock.

Unfortunately, the Government seems to think that the interlocks will also work for recidivist drunk-drivers. The fact is that they will get compliance, perhaps. A person who has been caught drunk-driving four, five, six, seven times and possibly has even done prison time for that—they will comply, perhaps, for that period, but technology does not change behaviour. What is missing out of this picture? This is a technical fix for a social and often psychological problem. People who repeatedly offend, who are repeatedly caught drunk-driving, have a deep-seated problem with their behaviour that has to be revealed and dealt with. Technology will not actually solve that problem. Again, it is a characteristic of this Government that it thinks that technology can solve personal and social and, indeed, environmental problems. The alcohol interlocks are a useful strategy in the short term. In the longer term, if we are serious about recidivist drunk-driving, let us get busy and roll out the drug and alcohol courts, which actually deal with the root causes of repeat drunk-driving. Thank you.

DAVID SEYMOUR (Leader—ACT): I rise on behalf of the ACT Party in support of the Land Transport Amendment Bill, and I would like to quibble with the previous speaker, David Clendon, who said that the alcohol-interlock aspect of this bill will not make a difference. Well, the member lives in Kerikeri. The member is familiar with rural New Zealand—in fact, he talked about rural New Zealand in his speech. The change that is being made in this bill, coming back from the Transport and Industrial Relations Committee—and that is what second readings are about—means that this bill will apply the alcohol-interlock policy to people even if they live more than 30 kilometres from a major centre. I support that because drunk-driving has taken so many lives, and we should be using technology evenly across New Zealand to restrain all of those who reoffend.

Going from the rural areas to the urban, this bill would also ensure something that is long overdue. In representing the Epsom electorate, at the centre of Auckland, our largest city, I know that we are in a transition from being an archipelago of provincial towns to a country of large cities. That is right, Paul Foster-Bell, there is still some—

Paul Foster-Bell: Archipelago.

DAVID SEYMOUR: Archipelago—thank you. That is right; I am very sorry—archipelago. The fact of the matter is that as we become larger, we need some of those big-city laws and regulations.

We need to ensure that the transport companies and the police are able to enforce fare evasion on our public transport networks. We need to ensure that it is a criminal offence that can be punished when people use our public transport networks without paying, not just because it takes revenue to run a public transport network, not just because everybody should pay their fair share, but because fare evaders tend to be people who are up to no good. We have seen this in the Epsom electorate, where people commit crimes and evade the detection of the authorities by saying: “We are going to use the free train.” That is what the local police will tell you they call it—the “free train”. So it is critical that this bill makes it illegal and gives the authorities the power to police people who would evade fares on our transport networks in our growing metropolitan cities.

Far more interesting and exciting in this bill, in my view, is the change to the regulations for shared transport. Oh my God, are we not so far behind the times in this Parliament when it comes to the idea of people sharing rides for money. You see, the Cancer Society of New Zealand in Auckland has 500 volunteers who ferry patients backwards and forwards between their homes and their treatment without charging anything. That is wonderful, but we have the opportunity to become world leaders in people who share rides in their vehicles with other New Zealand citizens and are given remuneration in the form of cash for performing that duty.

We are starting to see this with Uber, with Chariot, and with Zoomy up and down this country, but the select committee that heard this bill did not understand any of it. Had the members understood what this bill was about—

Sue Moroney: Ha, ha! What rubbish—what rubbish.

DAVID SEYMOUR: There is Sue Moroney. She was one of the worst offenders. She had no idea. She was ridiculed from Northland to Southland for her lack of understanding of basic modern technology.

Sue Moroney: Did you not hear my speech?

DAVID SEYMOUR: Bye-bye in September, Sue. What we need to do is ask ourselves what the role of Government is in ride-sharing regulation. The Government knows what your criminal record is—not yours, Mr Assistant Speaker—and it knows what a person’s driving history is. Those are the only two questions the Government should ask when it authorises somebody to share a ride for money. If we were to make that the only test, then becoming an Uber driver, or a Chariot driver, or a Zoomy driver would become something that almost every New Zealander would be doing. We could lead the world in technology. We could increase the vehicle occupancy rates in our cars, but this bill does none of that, and it is a terrible shame.

PAUL FOSTER-BELL (National): It is a pleasure to take a brief call in this Land Transport Amendment Bill second reading debate. It will be brief because whilst I do not normally sit on the Transport and Industrial Relations Committee, I did have the pleasure of sitting in on the now notorious session of public hearings where, unfortunately, the media did mischaracterise—and I think it was a mischaracterisation—the level of understanding that the members in this House have of ride sharing. Whilst I was very pleased not to be one of those members who was mischaracterised as being ignorant of how an app or a modern ride-sharing system would work, I think it was rather unfair. I do not think the questioning by Ms Moroney was quite as atrocious as was made out in the press.

I want to respond to a couple of things that were said by a member in a previous speech, Denis O’Rourke. I want to respond to his comments about the modern ride-sharing systems. I appreciate the member Mr O’Rourke probably does not recognise a mode of transport unless it is steam powered or piston driven, but the reality is that the changes that have been brought in are very balanced, and I think they do present a balanced approach to reconciling the need for public safety with enabling and underpinning modern, technologically driven services such as Uber.

So, for instance, when it comes to cameras in taxis—Mr O’Rourke referred to the safety aspect around cameras—I think if you go into an accommodation provider in the country or if you go into a backpackers, you can make some informed decisions around whether they have cameras in the lobbies, whether they have card access, and whether they have lift controls and these sorts of things. This is something that the consumer can make an informed decision on. And, actually, given the person booking an Uber, or equivalent ride-sharing ride with their smartphone, has access to an emergency call that they can make directly from their smartphone—their smartphone does contain a camera, and this Government, it should be remembered, is bringing in a 111-equivalent system to enable people to access the emergency services via their smartphones—I think the argument made by Mr O’Rourke was completely specious and it should be dismissed as the piffle that it was.

So I think this is a good bill. It does many other worthwhile things. It does crack down on drivers who flee police—the committee made a sensible amendment so that it does so using existing powers already in existence under sections 7 and 21 of the Bill of Rights Act 1990. There were some concerns about introducing new powers.

I think, taken as a whole, this is a sensible measure, and it does go some way to really underpinning and enabling those new technologies, which I am pretty convinced will be only the start of the transformation of our transport systems in New Zealand. Thank you.

PEENI HENARE (Labour—Tāmaki Makaurau): Tēnā koe, Mr Assistant Speaker. In the vein of much of the contribution earlier this evening, I would like to start with a theme. From the 1976 album A Night on the Train, tonight is definitely the night. Tonight is the night when we debate this particular bill, the Land Transport Amendment Bill. My colleague here, Sue Moroney, talked about Rod Stewart and how “Rod Stewart” presented to the Transport and Industrial Relations Committee and really pointed out the flaws, the discrepancies, and the ease with which he was able to exploit this particular system. For the purposes of natural justice, his particular case was shared with Uber and others who are involved in this particular space, and none of them had an answer. None of them were able to rebuff the fact that this particular gentleman actually flouted the rules, flouted the system, and was able to get away with it.

So, sticking with the Rod Stewart theme—

Hon Member: Oh really?

PEENI HENARE: Well, you know, he is a great singer and is married to one of our locals, so we might as well stick with it.

Sue Moroney: Was.

PEENI HENARE: Well, he was—he was, yes. I could give a bloody good quote of his—but anyway.

I am glad to hear the member for Epsom mention how tonight the good people of Epsom will be able to sleep well this evening, without fear of fare evaders storming through Epsom—running riot across Epsom. There is no ability in the old legislation to actually hold them accountable for evading fares, so we support that particular part of the bill. What we did question during the select committee process was—OK, we can allow for more police officers and other officers of the council to crack down on fare evasion, but that only works if you actually resource them to do it. We certainly do not expect our upstanding policemen and policewomen across the country to be standing outside a train station waiting for anybody who happened to evade a fare of $4 and make sure that they throw the book at them and that the heavy hand of the law comes down on that person who, for one reason or another—who knows—might have caught the train in South Auckland and had no money. We understand the poverty issues. But I digress. We support this particular part of the bill but wonder whether or not it comes with the resources to make sure that the legislation as described here in this bill is actually carried out.

I also want to pick up the point made by Mr Young, the chairman of the select committee, about how he mentioned that some of the apps that are currently available for those who are vision impaired are able to talk to them—are able to talk to them—so there is not a need for Braille. When the submitters came to the select committee they made it very clear that a lot of that technology for those vision-impaired people is still very expensive—very, very expensive. Many in the vision-impaired community were unable to afford many of those particular pieces of technology to allow them to be able to enjoy a passenger service, in particular in Tāmaki-makau-rau, in Auckland. Just to the point that the chairman of the select committee made, it is all fair and well to say that the technology exists and is available there for them, but the fact of the matter is that it is not available to all of them. That is why we will be supporting wholeheartedly the amendments that will be proposed by my colleague here, Sue Moroney, about the small compliance cost to make sure that there is Braille available on a taxi so that those who are vision impaired are able to actually understand that this is who this person is, this is the service that they provide, and, should anything happen to them, they will know who that person is.

We heard, I thought, a quite harrowing story from one submitter, who actually feared for their life as a vision-impaired person catching a taxi. They explained how they were taken to a place where they were not comfortable—the kind of conversation and the inability of the driver to explain exactly what was happening and where they were going left this particular submitter in fear for their life. So we will be supporting the amendment that will be proposed by Sue Moroney to ensure that that small compliance cost surely can be met, to make sure that that community is looked after.

There is also the other one—cameras being available in all taxis. The chairperson of the select committee talked about how technology is the now, it is the future. We do know that with this technology and the market the way that it is, cameras and such apparatus for a taxi are actually quite cheap and easy to install. It is important for the matter of the safety of drivers and passengers that this actually be a compliance that is required for all who are operating in this space. So we will be supporting the proposed amendment from Sue Moroney on that matter.

The other ones are pretty straightforward. Of course we support the drink-driving interlocks, right across the House, and I take the point made by the member Julie Anne Genter. I think we actually made the bill better.

Sue Moroney: We did.

PEENI HENARE: We did. The select committee worked hard. There was rigorous debate. Those who came to explain the technology and the science of it—I think that through the debate in the select committee it was made better and stronger. We all agree that we want to take recidivist drink-drivers off the roads—drink-drivers, full stop, off the roads—to make sure that those who use our transport system are safe.

To another point that I think my colleague Julie Anne Genter touched on, and that is the sad fact that this Government looked at this particular bill as almost in a silo, when, really, what we should have been considering when we looked at this bill was actually a broader look at our transport system, in particular in Tāmaki-makau-rau. We need legislation that will force a change in the way we think about our transport network in Tāmaki-makau-rau. While this particular bill goes some way to doing that, it is only a small part, which is where I take the point made by Mr O’Rourke in saying that this bill is, in some parts, quite substandard.

But the Labour Party will be supporting this bill, in particular the amendment proposed by my colleague Sue Moroney that will come up, no doubt, in the next stage of this bill. That one, of course, is about cameras—about making it compulsory to have cameras in taxi services—and also about the relatively small compliance cost to make sure that Braille is available to the visually impaired community, which relies on these services. Julie Anne Genter explained it quite well, that they are quite vulnerable. In fact, they are very vulnerable. They rely on a sound, strong transport system that looks after their safety but also allows them to participate in our communities far and wide.

Without going on for too much longer, I just wanted to stand up in support of this bill. I would also point out some of the flaws that we encountered as this bill went through the select committee, and I hope that, in its next stage, further debate will be able to take place and we will get the support needed across the House for the sensible and smart amendments that will be proposed by Sue Moroney. Certainly the Labour Party will support this bill.

A party vote was called for on the question, That the Land Transport Amendment Bill be read a second time.

Ayes 107

New Zealand National 58; New Zealand Labour 31; Green Party 14; Māori Party 2; ACT New Zealand 1; United Future 1.

Noes 12

New Zealand First 12.

Bill read a second time.

Name changed to Land Transport Amendment Bill (No 2).

Bills

Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill

Second Reading

Hon JUDITH COLLINS (Minister of Energy and Resources): I move, That the Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill be now read a second time. I want to acknowledge the work of the Commerce Committee and thank its members for their thorough and robust consideration of this bill. In particular I note the chair of the select committee, Melissa Lee, and her contribution.

To improve the efficiency of our energy use and to meet our climate change commitments, we need a shift in focus to reduce our emissions and improve our energy productivity. Transport, energy, and process heat are key areas where gains can be made. The bill has four parts and will amend the Electricity Industry Act 2010, the Energy (Fuels, Levies, and References) Act 1989, the Land Transport Act 1998, and the Road User Charges Act 2012. It will support our focus on reducing emissions and improving energy productivity, while ensuring our legislation can accommodate innovation.

The bill will expand the purposes for which the existing electricity efficiency levy, the gas levy, and the petroleum or engine fuel monitoring levy can be used. It will enable the Energy Efficiency and Conservation Authority (EECA) to use all three levies to encourage, promote, and support energy efficiency, energy conservation, and the use of renewable sources of energy. Giving EECA access funding from three levies will enable the cost of EECA’s activities to be spread across the levies for transport fuels and gas, instead of being confined to electricity. This move beyond electricity will enable EECA to use its levy funding to undertake a broader range of activities, giving it flexibility to focus on areas where the measurable gain is the greatest. The bill also promises to improve the operation and administration of the levies.

Electric vehicles (EVs) offer a way to leverage greater value from New Zealand’s renewable electricity, and therefore offer the most potential for emissions reduction while ensuring economic growth. This was the rationale behind the Electric Vehicles Programme—a package of proposals announced by the Government last year to increase the uptake of EVs. This bill contains two initiatives from the EVs programme. The bill will clarify that a road-controlling authority may use its bylaw-making powers to give EVs access to special vehicle lanes. Trials in places like Norway and California have shown that allowing EVs in special vehicle lanes is one of the most effective non-financial incentives we can put in place to increase uptake.

The bill also encourages the uptake of electric vehicles by extending the road-user charge exemption to include heavy electric vehicles such as electric trucks and buses. This change is a transparent and efficient way to provide a financial incentive to encourage heavy electric vehicles over equivalent conventional heavy vehicles.

The bill also clarifies how electricity industry legislation applies to secondary networks. Secondary networks are smaller electricity networks that indirectly connect to the national grid, typically through a local distribution network. They offer a unique business model that is becoming more widespread and is attractive to business owners. Owning and operating a secondary network offers business owners opportunities for integrating new energy technologies such as combining solar photo, photovoltaics—sorry, I always have trouble with that one; in other words, solar panels—and battery storage on a residential subdivision and supplying those to consumers.

Consistent treatment under the legislation will help this kind of innovative business model to endure and thrive. The bill will provide regulatory certainty and improve outcomes for consumers in the market as a whole. It will ensure that consumers on secondary networks have the same consumer protection and access to dispute resolution as consumers on local electricity networks.

The Commerce Committee has made some sensible recommendations that will improve this bill. I will touch on some of these now. There have been some concerns raised regarding a road-controlling authority’s ability to effectively enforce the use of special vehicle lanes by EVs. The committee has recommended a change to the bill to permit an image taken by approved vehicle surveillance equipment—or, in other words, an automated camera—to be evidence of the unauthorised use of a special vehicle lane.

Once a number plate of a vehicle has been recorded, information about it can be accessed on the motor vehicle register. The motor vehicle register is in the process of being updated to show whether or not a vehicle is electric. It also shows who owns the vehicle, so that, if necessary, the owner can be sent an infringement notice. This change will provide another option to enabling road-controlling authorities to enforce the correct use of special vehicle lanes.

The bill, as introduced, will also allow heavy EVs to be exempted from road-user charges (RUC) for a period of time by Order in Council. The committee has recommended a change that requires the relevant Minister to be satisfied that any Order in Council under this section has the purpose of encouraging and supporting the uptake of heavy EVs. The committee has further recommended that the initial RUC exemption would expire no later than 31 December 2025 and that any subsequent exemption would last for no more than 5 years.

With regard to the changes the bill makes to expanding existing energy levies to recover funding for EECA, the committee has also made some sensible recommendations to improve operation and administration of the gas levy provided under the Energies (Fuels, Levies, and References) Act 1989. These changes include placing liability for the gas levy on retailers alone to improve recovery of the levy. It has also recommended shifting the existing exemptions to the levy to regulation, to enable them to be kept up to date, and removing the current exemption for a sale of less than 10,000 gigajoules of gas in a quarter so that every retailer is treated the same.

Finally, the bill as introduced makes changes to clarify how electricity industry regulation applies to secondary networks. It does this by adding new definitions for “secondary network” and “secondary network provider”, and a statement that a secondary network provider is to be treated as if they were a distributer for the purposes of the Electricity Industry Act.

During consideration of the bill, submitters raised concerns that the new definitions were too broad and could inadvertently include things they should not. The committee has recommended a minor change to the drafting to more closely match the policy intent, which is that the owners of secondary networks who are undertaking activities that are akin to those of an electricity distributer are subject to the same requirements under the legislation. The committee noted that there were a range of exemption options already in place and that obligations or requirements can be developed or amended to ensure that they are appropriate for secondary network owners.

This bill will encourage energy innovation such as emerging energy technologies and increase variation in energy-related business models, so that New Zealand can respond to its environmental and energy objectives. I commend this bill to the House.

Dr MEGAN WOODS (Labour—Wigram): It is my pleasure to take a call on this. Labour is supporting this Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill. We supported it at its first reading and we think that there was a good select committee process. I would like to congratulate the Commerce Committee, which I had the pleasure of sitting in on for some time on this bill, the chair of that select committee, as well as all the other members. The Minister has outlined very ably the three main things that this bill—that is packaged up as energy innovation—does. While there are some necessary and good changes in here, let us not over-egg this as being the innovative answer to everything.

Let us go through what each of these three changes mean. The new road-user charge exemption applying to heavy vehicles as well as light vehicles, which the Minister has outlined, is going to be increasingly important as we think about not only how it is that we uptake electric vehicles (EVs) but how it is that we uptake EVs so as to minimise our greenhouse gas emissions. Fundamentally, this bill is part of a patchwork of options that need to be put in place in order for New Zealand to address its greenhouse gas emissions. It is part of a patchwork. I stress that because, personally, I would like to see an analysis of how this bill and its measures fit within a carbon budget so that we can have an idea about how all the component pieces fit together. How does a change in transport impact on what the overall reductions in our greenhouse gases are going to be?

Changing to electric vehicles makes sense in New Zealand more than most other countries in the world. What we see in New Zealand is that every time someone makes the decision to use an electric vehicle there is a direct switch from fossil to renewable energy. Unlike some other countries where people are opting to move from a petrol-powered or a diesel-powered vehicle to a vehicle that is powered by electricity but that electricity is indeed generated by the burning of fossil fuels, in New Zealand it is a straight—usually a pretty much one-for-one—swap between fossil and renewable energy. So we have huge potential to address our greenhouse gases through our transport emissions. Transport emissions currently make up about 20 percent of our entire greenhouse gas emissions in this country, so the potential is immense. Of our transport emissions, 60 percent come from light passenger vehicles, so there certainly are savings that are going to be made here.

But it is not just in terms of the good of the planet and the need to reduce our greenhouse gas emissions—it also makes huge economic sense. If you think about some of the things that New Zealand does well, it is the production of renewable energy at relatively low cost, if you compare this with other parts of the world. Renewable energy is roughly the equivalent of 30c a litre in New Zealand, so just do the math on that of what you are currently paying at the petrol pump. You are over $2 a litre for fossil fuels when you fill up your car, and you can see that there are immense savings for people to make.

If we are saying that 60 percent of all our transport energy consumption comes from our light passenger fleet—the cars that drive around and that people use to go from point A to point B in the course of their day—we also need to turn our attention to thinking about the other 40 percent, and that is our heavy-vehicle fleets. That is why the provision that we have here in this bill and the first measure that this does, which is about enabling the road-user charge exemption to heavy as well as light passenger vehicles, is a very important measure.

The other thing that this bill does is it allows the Energy Efficiency and Conservation Authority (EECA) to use its levy in a broader way, not just in terms of electricity. This is a good thing, allowing EECA to have a broader remit. We need to think about energy not just in terms of electricity but across a range of things. But this cannot be at the expense of the other very important work that EECA does in New Zealand. My fear is that we are seeing the reduction of funding to some other very important programmes within EECA, such as the ability of homeowners to access home insulation funding, which I think is important.

The other measure that this omnibus bill does is to allow electric vehicles to travel in bus lanes. As you can imagine, this was a part of the bill that attracted some attention from submitters. I think the important point to acknowledge here—the point that, understandably, people brought and were worried about at the select committee phase—was that just letting cars into the bus lanes is going to subvert the purpose that those pro - public transport lanes are there for, which is to allow non-congested routes through our cities where people can elect to take public transport and not be bogged down in the congestion that cars are in. This certainly was a concern that I had around this measure.

But there are some measures in this that do give me a degree of certainty around that. We heard from Auckland Transport, Greater Wellington Regional Council, and Waikato Regional Council, so this was a widely held view. But there are a couple of measures in here that do give me some peace of mind around this. The first is that it is an opt-in provision for individual road-controlling authorities. It is not mandatory now that under this legislation every bus lane in the country will be opened up for EVs, or electric vehicles, to be able to travel in them. This is something the individual territorial and road-controlling authorities will be able to make decisions around. There well could be routes in different parts of cities or throughout the country that just make no sense to allow electric vehicles to go in. It is going to subvert the whole point of having them there, which is actually to free up our roads and to allow people to travel in a less congested manner. So that is certainly something to consider.

At the moment, allowing electric vehicles into bus lanes is not going to cause a huge amount of congestion, for the very simple reason that we do not have that many of them. There are, I think, just over 1,000 electric vehicles in New Zealand at the moment, so we are not going to wake up the morning after this legislation is passed and find our bus lanes across the nation clogged with electric vehicles. The other important provision that this legislation contains is the ability to phase that by-law out. So it will make sense at the beginning, as we are encouraging people to buy electric vehicles, but this is not set in stone for ever. It can be a temporary provision while it makes sense.

Obviously, this is legislation that is put in place to try to sit alongside the Government’s aim of having 64,000 electric vehicles on our roads over a period of time, which, incidentally, is pretty much what the Ministry of Transport’s modelling shows us would happen if we did nothing—if we just allowed nature to take its course and there was not any Government intervention. So in terms of being a radical disruption, this bill certainly is not. This is what I like to call a “standing still measure”. This is what is going to happen anyway. So what we do have, though, is the ability for road-controlling authorities to opt out of that over time. I think that these are important concerns and ones that the committee certainly listened to.

Another issue that did tax the committee for quite some time was the issue that the Minister touched on, and that was around the ability to enforce who should and should not be allowed in a bus lane, which cars should be in there, how we are going to demarcate which cars were indeed electric vehicles, what measures we could put in place that could not be ripped off—so that those who should not be in the bus lane were not putting in place a wrong sticker on their car, or a similar measure, and sneaking into the bus lane and getting a quicker ride to work.

We spent quite a long period of time considering measures around that in the committee. We looked at different models around the world and different things that could happen. It seems to be that the ability to use the photography and the images taken there could be something that can act as a deterrent. But that is something we need to keep a watching brief on, because as we get more and more EVs on our roads, as technology changes, as electric vehicles and normal combustion engine vehicles cease to look different from each other, this could become a problem. I think this is something that as legislators we need to keep a watching brief on and check that that is in check.

This is a bill that brings into place some measures that are important. The third provision very much reflects the need to keep the regulatory framework up with the technology and the different ways in which electricity is now being generated. These are necessary. They are a small part and a small start, and Labour will support the bill for that reason.

MELISSA LEE (National): It is a great pleasure to rise to support this second reading of the Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill. Before I actually begin, I would like to thank the member who just took her seat, Dr Megan Woods. I am very glad that she enjoyed her time at our Commerce Committee.

This bill is an omnibus bill that was brought before the Commerce Committee last year. During its time before the Commerce Committee, we received and considered 40 submissions—11 of those were oral submissions that we heard. We also received advice from the Ministry of Business, Innovation and Employment, as well as the Ministry of Transport. This bill proposes to expand the ability of EECA—the Energy Efficiency and Conservation Authority—to use its existing levies for wider purposes. The bill also provides incentives and encouragement for the greater uptake of electric vehicle use, through road exemption charges and clarification of the by-laws that are relevant to electric vehicle usage in our towns and our cities.

One such option at the local level that this bill would allow is for the high-occupancy bus lane that the member who just took her seat talked about and for other special vehicle accesses to be implemented by the road controlling authority. And it is an opt-in situation. This is important as it would provide a key incentive, particularly in high-volume traffic communities, to buy into new innovative vehicle technologies that benefit the environment and wider community.

We also recommended that a new clause be inserted into the bill to allow vehicle surveillance equipment to be used on our roads and highways to track unauthorised use of special vehicle lanes. As Dr Woods actually said, we had many amusing discussions as to how those vehicles would be identified—whether it was going to be stickers or whether it was different coloured number plates. So it was a very thorough discussion that we had. This is because the motor vehicles register is in the process of being updated to show whether a registered vehicle is, in fact, an electric one, and this would reduce bureaucracy in the processing of infringement and compliance notices.

The way we have got it, the bill will also make changes to clarify how electricity industry regulation applies to secondary networks, as the Minister has in fact spoken about. The committee recommended clarifying the definition of a secondary network provider, to better match the policy intent of the bill, to make sure that it is clear that if the secondary network provider undertakes activities and practices—if they in fact undertake practices like an electricity distributor—then they should be subject to the same regulatory oversight requirements. The committee also supports the allowance for Orders in Council, which the Minister talked about.

Another important area that this bill covers is the collection of the gas levy. The committee has recommended allowing for regulations to be made for exemptions from the gas levy so that the liability of the gas levy is solely where the gas is sold by the retailer—that is, where the collection is. This would make it clearer as to who is in fact liable for the levy, increase transparency, and not require a complete restructure of the levy liability rule.

Our economy is diversifying, and our choices of travel are diversifying as well, in fact. More public transportation options, more car-share services, as well as more choices in our private vehicles, with better, more fuel-efficient and eco-friendly options at reasonable prices, will continue to benefit New Zealand. As technology progresses, those vehicle costs will come down as well. We are an innovative country with leading science in our R & D industries. An energy innovation amendment bill like this one will continue to see our country embrace greater opportunities for New Zealanders. I commend the work of the previous Minister of Energy and Resources, Mr Bridges, and also the current Minister, Ms Collins, for bringing this bill to the House. I commend the bill.

CLARE CURRAN (Labour—Dunedin South): Having sat on the Commerce Committee as well, alongside my colleague Megan Woods and my colleague across the House and chair of the committee, Melissa Lee, we had a number of interesting discussions around this bill. I want to thank Megan Woods for her considered and quite proactive and constructive comments around the bill. I think she is being very polite in a lot of ways in describing its potential as being a starting point.

Can I just say, though, that this is a bit underwhelming, after 9 years, to be looking at this as being the harbinger of a great strategy to help reduce emissions and to be the introduction of the new technology, the new way of driving—electric vehicles. I know that the previous Minister of Energy and Resources, the Hon Simon Bridges, talked—and no doubt still continues to talk—a lot about how electric vehicles are the future, how this is what we are all going to be doing in the future, and how this is what we can be doing. But if this bill is it, in terms of how we are going to enable and encourage that to happen, then it is, as I said, a bit underwhelming. You could sort of tell, actually—the way the Minister who gave the speech initially in the second reading really did not seem hugely engaged. I am disappointed about that because there is so much more that could be done.

The predictions are that by 2021 there will be 64,000 electric vehicles on our roads, and the part of this bill that deals with how that is going to be acknowledged really is around enabling them to use the special bus lanes. If you live in Auckland, if you live in Wellington, and no doubt in a few other parts of the country, that is just going to create more problems in terms of congestion on our roads if we are not dealing at the same time with a comprehensive public transport strategy and the introduction of light rail in Auckland. There are a whole lot of other infrastructure things that we need to be doing alongside a measure that allows and gives a special status to electric vehicles to be able to travel in the bus lanes.

The reason they are called “bus lanes” is so that the buses can travel in them and there can be a lack of congestion, enabling people to travel backwards and forwards to work—or wherever they are going—using the public transport system on the road and enabling that travel time to be less. If you put 64,000 electric vehicles—or the proportion of them that are in our major cities by 2021—into those lanes, then there are going to be problems without doing anything else. So let us give it a tick as being a start—a good start, a bit of a start—but also let us say it really is not enough.

I want to actually refer back to 2008 under a previous Government, the Labour Government, when the Hon David Parker, who was the Minister of Energy and the Minister responsible for Climate Change Issues at the time, initiated a strategy, the New Zealand Energy Strategy, which was actually quite “big picture” and had some really strong goals in this area and of course in other areas. He established in April 2008 a vehicle energy and renewables group of nine industry and research experts who were looking at promoting the use of renewable energy and transport, especially in the areas of electric vehicles and biofuels. You know, there was some really good thinking happening then. It seems to have gone into a bit of hole.

I want to read a bit from a speech that he gave, I think in April 2008, when he said: “To ensure the best cooperation between industry and government the Minister of Transport has appointed a group of individuals to meet regularly with Ministers and officials.”—that was the vehicle energy and renewables group—“Our goal is to position New Zealand to leverage the benefits of our highly renewable and low carbon electricity supply to provide for our transport needs once electric vehicle technology reaches maturity. Electric vehicles can provide a positive contribution to our trade balance and energy security. We believe it will be beneficial for New Zealand to be one of the first nations to adopt plug-in hybrid and purely electric vehicles. There is a unique opportunity to combine electricity and transport sectors with net benefits for both.” That scenario assumed that there would be a high percentage of the public sector fleet that would be plug-in hybrid, and growing up to 60 percent by 2050.

Where are the Government’s targets in that and where is the big-picture thinking? Is this it in terms of expanding the way that the Energy Efficiency and Conservation Authority levy is used and enforcing the use of special vehicle lanes, enabling special vehicle lanes to be used for electric vehicles, and changes to the collection of the gas levy and regulations made under the Road User Charges Act? These are all small measures. I think Megan Woods described them as small pieces in a bigger strategy, or a strategy that does not really exist.

Labour supports this bill because we see it as being a step. We heard the submissions. We listened closely to what was being said. We heard particularly the submissions from Auckland Transport, the Greater Wellington Regional Council, and the Waikato Regional Council, which did stress the negative effects on the ability to deliver public transport services by allowing electric vehicles access to those special vehicle lanes. What else is the Government doing in this space? That is what I would like to hear. That is what I would have liked to hear from the Hon Judith Collins, and I am hoping that we will hear a bit more about that. It is a pity that Simon Bridges could not have given us a passionate speech about his plans for the future of electric vehicles, but this piece of legislation is pretty underwhelming.

BRETT HUDSON (National): I rise in support of the Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill in its second reading. It was actually a very good bill to sit on the Commerce Committee for. I think we are all, on both sides of the House, looking for a good means to provide incentives for people to increase uptake of electric vehicles. The measures were first proposed, obviously, by the Government and agreed to, after some discussion, by the committee. If you look at what we are doing, in modern economics parlance they call it behavioural economics. Of course, this is one of the most egregious tautologies ever to disgrace the English language, but, setting that aside for a moment, it is based on this idea of nudges—gentle ways of steering people into decisions that are good for them and good for our society.

This legislation, or proposed change, is an example, I think, of nudging at its best, where we are offering some small but tangible incentives where people might decide that buying an electric vehicle is, obviously, not only good for the environment through a reduction in emissions but is good and sensible in New Zealand, because the very next watt of power we generate is going to be renewable energy. Unlike, perhaps, in the United States, where their electric vehicles are actually coal-powered, in New Zealand it is most likely that the next watt generated will be renewable, and therefore you are in fact reducing emissions not only in the vehicle propulsion system but also in the electricity that it takes to charge it. This just provides some small incentives that give people further reasons to move in that direction. So the idea of using a special vehicle lane, or at least giving councils the ability to permit electric cars and electric vehicles in special vehicle lanes, is just a small but meaningful way that might help people to say: “I’ll make this investment instead of another form of a fossil fuel - powered vehicle.”

We had some really good discussions about how we could be sure, if we were going to do something as simple as permit the potential use of these lanes, that only the right vehicles were using them. Ultimately, you know, the future is technology-based, and ultimately we have suggested that permitting the use of technology to monitor that compliance is the way to go. Stickers or even coloured number plates might have given a visual reference, but that, in some respects, is possibly the way of the past, not the way of the future. So I think we have returned a very positive bill to the House.

I think the other “little nudge” aspect that I quite like is the exemption from road-user charges for these vehicles—both passenger vehicles, which we did some time ago, and also heavy electric vehicles. Again, it is just another small but tangible incentive that might help people to make a decision now to move to a vehicle propulsion system that is probably going to be our predominant propulsion system in just a few years’ time. So I commend this bill to the House.

GARETH HUGHES (Green): Kia ora, Mr Assistant Speaker. Ngā mihi nui ki a koutou, kia ora. I rise to take a call on the Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill. I do not know whether there has ever been a more misnamed bill put in front of this House. This bill is not about energy innovation; this is about energy tinkering around the margins. This is about energy bureaucracy. This is not about energy innovation. I do not even know whether the Minister has actually looked up in the dictionary what the definition of “innovation” is, because it is not contained in this legislation.

Look, the bill does three things—three pretty reasonable, small things. We will vote for it because they are pretty reasonable things, but they are small things. They are not innovation. The bill moves around the levies that the Energy Efficiency and Conservation Authority (EECA) can use. That is not innovative. It allows an extension to the road-user charge exemption to include heavy vehicles. Look, it is reasonable, but it is not innovative—not when you look at what is happening in Europe and America and Asia. Then it clarifies how the electricity industry legislation applies to secondary networks. Again, that is just a bureaucratic tweak and hardly innovative.

Let us go through it. Sure, EECA can now access some old levies and put them together, which is probably a good thing. The big problem is, though, that EECA has been consistently underfunded by the Government. We now see the home insulation scheme, run very well by EECA, at the lowest point ever in 9 years. I am proud of what we achieved in working with the Government to insulate 300,000 homes, but now we are doing only 6,000. The funding is running out. It has been left up to absolutely no one at all. The fact is we still have more than 700,000 substandard homes in New Zealand—homes where our kids are getting sick from the damp and cold. There are 40,000 trips to hospital made by New Zealand children because they are sick as a result of their housing, and 1,600 additional wintertime deaths. If we are going to be innovative, let us set a target of upgrading the million substandard homes in New Zealand. It is not innovative to just cap the funding and move some levies around.

We have got a huge opportunity in the energy efficiency and conservation space. The fact is that experts have shown the economic cost of investing in energy efficiency is 0.6c per kilowatt hour. The cost of new generation for New Zealand is, on average, 8c per kilowatt hour, or higher. It is an order of magnitude cheaper. This is why, instead of focusing on burning coal at Huntly or on new gas-fired power stations in the Waikato built from gas drilled from fracking and new megawatts, we should be looking at what are called new negawatts, or using electricity more efficiently. So it is hardly innovative.

When we look at encouraging the uptake of electric heavy vehicles by extending the road-user charge exemption, this is surely one of the most modest electric vehicle initiatives around the world for countries that are adopting it. Look, that is a reasonable thing, but I would point out the deep irony that at a time when the Government is waving a bill around the House and calling itself innovative when it comes to energy, we are seeing our fully electric trolley buses disappear from Wellington’s streets and we are seeing diesel locomotives and the de-electrification of our main trunk rail line.

On the other side of the ledger regarding this bill, the Government is trying to encourage electric vehicles by opening up bus lanes. I know that my colleague the Green Party transport spokesperson, Julie Anne Genter, is going to touch on this and on how it can be detrimental to mobility in our cities. I would point out that we did hear this message very consistently in the Commerce Committee. Why I called it an energy bureaucracy bill is because what we heard from councils was that because this legislation will not give them easier, common-sense ways to enforce it, we are, basically, going to be once again putting another fiscal burden on to local government. Local government is going to go out and will have to buy expensive cameras and will have to monitor which vehicles are in the bus lane or not, in order for us to use electric vehicles. Instead of spending money to support electric vehicles by, for example, investing in infrastructure—and I note that some of our councils are doing a fantastic job of doing that—we are going to be seeing the money being spent instead on bureaucratic monitoring.

If we were really going to be innovative about electric vehicles, we would be looking at measures such as changing fringe benefit tax rates, we would be looking at having a modern State highway infrastructure network, and we would be looking at a symbolic step from this Government—instead of seeing it buying and driving around diesel limousines, we would see it going to the future and driving, perhaps, the Tesla S. This is why—

Hon Simon Bridges: We’re doing all of that.

GARETH HUGHES: Simon Bridges, you know, has launched the same policy eight times, because it is more about spin, right? The Government is looking like it is spinning its wheels, and that is simply all it is doing. It is not really moving anywhere; it is simply spinning its wheels. It is a Government based on spin.

The third thing is that the bill is clarifying how electricity legislation applies to secondary networks. Small, reasonable—but look, you cannot call yourself innovative when you are standing by when solar homes and businesses are under attack by the old power incumbents.

Look across the country—we have got citizens in Rotorua, Taupō, and the Hawke’s Bay facing solar taxes from the companies that are scared of solar, and what has Simon Bridges done? What has Judith Collins done? Absolutely nothing. You cannot wave around a bill and call yourself innovative on energy when you are standing by while the old-fashioned incumbents are trying to squash a competitor.

If we were going to have an energy innovation bill, I think it would be more along the lines of the energy policy the Green Party launched recently. Here are five areas where we could be innovative when it comes to energy. We could be dealing with the inefficiencies in our distribution sector. We have got 29 different lines companies across the country, all duplicating things, duplicating back-end services, reinventing the wheel—29 different pricing schemes, which means we maybe have 100,000 different retail accounts from the electricity retailers, because there are so many electricity lines companies.

What we see is that they are very good at investing in expensive poles and wires, but less so in investing in cheaper, smarter—Simon Bridges, this is for you—more innovative options like batteries, energy efficiency and conservation initiatives, and solar. What I would like to do is encourage them to be able to work together, to collaborate, to amalgamate. I would like to give them a requirement that they must consider smarter, more energy-efficient and innovative ways of doing business before investing in traditional poles and wires.

I would like to see a more transparent electricity market. I want to see a competitive market where people are operating on a level playing field, but what we hear very clearly from the smaller retailers is that they do not have the ability to compete because they cannot access the hedge markets in Australia, which limit and lack serious liquidity compared with Australia or the US. What we would make sure we can bring is transparency to the wholesale electricity market, so that those cheaper prices can flow through to retailers. When it comes to pricing, what we see is, instead of focusing on the real issue—which is how we encourage more cost-reflective, real-time pricing, for example, in the lines networks; for example, encouraging what Flick does. The Green Party would like to see the big retailers offer that as a tariff, because that way we can see consumers save money, and we can see the country save tonnes and tonnes and tonnes of carbon.

But what is the Government focused on? Well, Judith Collins announced yesterday that she is going to review the low fixed user tariff. This is the only price signal a consumer faces in the New Zealand electricity market to use electricity more efficiently, to encourage conservation. If we can do that, particularly at the peak, we do not have to burn coal at Huntly, we do not have to burn fracked gas in the middle of the Waikato, because we would have smarter ways of doing business. We want to see inefficiencies reduced, alternatives encouraged, more transparency, and fairer, more realistic pricing.

Just lastly, if we can get them right, we can not only have a more innovative electricity system but we could be saving consumers money—those consumers who we know are going to hospital; who we know, sadly, are dying during winter, those who should be using more power. Also, we could see a cleaner electricity system.

The Green Party has got a vision that we could get to 100 percent renewables. It is affordable, it is achievable, it is eminently desirable, but what do we see under National? We see Huntly continue to burn more coal into the next decade. We see a new, massive application get a consent because climate change could not be considered, and National refused to use the power to consider climate change, which is going to increase our emissions by a full 1 percent at a time when our emissions are already going in the wrong direction. What we see is fewer renewables than we had under Sir Robert Muldoon, fewer renewables than we had in 1990. We could get to 100 percent renewables. This is the Green Party vision: cleaner, cheaper, smarter energy—this is the real innovative approach when it comes to energy.

TRACEY MARTIN (NZ First): Kia ora, Mr Speaker. I rise on behalf of my colleague Fletcher Tabuteau to speak on the Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill. I agree with my colleague Gareth Hughes that there is nothing innovative about this bill. Can I just ask—hands up all those inside the House who own an electric vehicle.

Hon Member: Oh, look at all those hands!

TRACEY MARTIN: Oh my goodness. Put hands down now—hands down now. Hands up all those who own an electric vehicle under $20,000. Right. Hands up all those who were on the select committee who own an electric vehicle. Oh, nobody. Righty-o.

Hon Jacqui Dean: Showing off, Tracey.

TRACEY MARTIN: And where it is going, Ms Dean—let us get real about the changes inside this bill. The opportunity to travel in a bus lane, which this bill does not actually do—what it does is it gives the council an opportunity to have an argument with the owners of electric vehicles about their ability to travel in bus lanes. That is the first thing. And it will have to be repealed or phased out within a 5-year period, based upon the numbers of electric vehicles (EVs) that are coming.

So, ultimately, it is completely useless. Ultimately, it is completely useless. What electric-vehicle owners actually want is more charging stations. The biggest barriers to people buying electric vehicles are (1) access to second-hand vehicles so they are under $20,000 and (2) distance anxiety—it means: “Can I get from there to there, and can I recharge my vehicle to go from there to there?”.

The North is quite well served, and thank you, Vector and Chargenet.co.nz—thank you very much. But if you go south from Auckland, you cannot go very far. There are no bus lanes in rural New Zealand, and rural New Zealand cannot participate and cannot take advantage of the lower cost of running an electric vehicle, because the ability to charge it up and the amount that it costs to charge up your vehicle are so much less than a petrol-driven vehicle. A bus lane will make no difference to anybody in Northland, but Northland has got the most charging stations. But Northland also has some of our most poor inside New Zealand.

What did this Government decide to do in this bill that regards energy innovation, electric vehicles, and other matters? It decided to let urban dwellers drive in a bus lane only if their council or regulatory body decides that they can do so, and it is not going to do so. Auckland has already indicated that it is highly unlikely that it is going to allow electric vehicles in the bus lanes. Ultimately, the Government has done nothing. Ultimately, with regard to electric vehicles, the Government has done nothing. It has extended the lack of registration, or whatever that fee is, for heavier electric vehicles, but for current and future electric-vehicle owners this does nothing.

Let us get real. New Zealand First will support the bill because there are other bits and pieces inside of it that are better than nothing, but this is not a bill for electric vehicles. There is absolutely no mention—no innovation—with regard to, say, Tesla solar roofing tiles. There is no capacity to expand inside of that industry, or whatever. There is no capacity to expand the charging network, because the Government will support it to happen. There is no capacity to expand and encourage people to purchase electric vehicles. There is no capacity to actually say: “What are we going to do with the electric vehicle batteries once they”—and I will use a bit of EV speak—“get down to 10 bar or 5 bar?”. What that means is the recharging capacity of the battery that is underneath the car.

In other nations, they can take it off and place it on the wall of their wash house or whatever, and they can use solar power to recharge that battery at lower capacity and then run their houses. Where is that innovation? It does not exist inside this bill, and it obviously does not exist inside this Government. So, again, on behalf of my colleague Fletcher Tabuteau, I take a call to say that New Zealand First will support the bill because it is better than nothing. But the word “innovation” should be removed from the title, and probably when we get to the select committee we might just suggest that. And, also, somewhere along the line, “electric vehicles” should probably be removed—

Hon Simon Bridges: I think you’ll find it’s been to select committee.

TRACEY MARTIN: —from the title because it does nothing, Mr Bridges. It does nothing. It is another piece of spin by the Government to suggest to the New Zealand public that it has actually taken this issue seriously. It has not done a thing.

I am not going to go any further. I think I have made my point perfectly clear. We will support the bill because there are bits and pieces that actually make a slight difference, with regard to the secondary networks, but with regard to electric vehicles, let us not kid ourselves and try to kid the New Zealand public. There is nothing in this bill.

SIMON O’CONNOR (National—Tāmaki): I was a little bit concerned about that last speech by Tracey Martin. It was sort of like one of those early versions of electric vehicles. It sort of ran out of puff after 20 kilometres.

I am very pleased to take this call on the Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill in this, its second reading. It was a real pleasure to sit on the Commerce Committee. There was actually a lot of robust debate, and, you know, the differences aside, actually it was a very interesting set of discussions. A lot of it focused around probably those tangible elements that we as MPs can identify with, which is cars, how they are going to work in their special vehicle zones—a lot of discussion about how we might identify these things.

Clare Curran: Bus lanes.

SIMON O’CONNOR: Some person over there said “bus lanes”, but, actually, there are more than just bus lanes within the category of special vehicle lanes. In fact, the member is very welcome to come to the great seat of Tāmaki to see some of those.

A lot of the focus easily moves towards where the electric vehicles are going to drive, but I think it is relatively important in this somewhat short contribution to note that the bill actually has four purposes. One, certainly, is around how we better encourage the use of electric vehicles, but one really important one is actually around the Energy Efficiency and Conservation Authority (EECA). Most of you will know that the ads on the television—the very short 20- or 30-second ads that encourage us to think about energy conservation—are funded by a group called EECA. Many people probably do not know what that stands for. That is the Energy Efficiency and Conservation Authority, and this bill, quite importantly, is changing not only its focus, if you will, but, really importantly, how it seeks to get its levy. At the moment the levy for EECA is paid purely through electricity use, and so this bill is expanding how that levy can be sought—importantly, something like gas, if someone is going to use that. So that is, I think, relatively important. As I said, it is a chance to really spread across a variety of areas of how this levy is to be sought. It really is a way to introduce some flexibility and transparency into the sector. I think that is particularly—particularly positive—

Kris Faafoi: Come on, take us to 10.

SIMON O’CONNOR: —particularly positive. Colleagues across the House are very keen that I keep talking for a while, but, you know, this is about energy efficiency and conservation, and so because of that interjection I am going to conserve some energy and allow my colleagues across the House to continue this debate.

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

JULIE ANNE GENTER (Green): Kia ora. Tēnā koe, Mr Assistant Speaker. Tēnā koutou e Te Whare. What I want to speak about in this bill has to do with the Government’s spin on electric vehicles, because it is very, very clear that the Minister of Transport, Simon Bridges, would like to give the appearance of supporting a transition to electric vehicles. That is great. I applaud him for having the ambition to at least demonstrate that he is supportive of the idea of electric vehicles by showing up to all the photo opportunities every time a charger station is opened or announced. Of course, his Government had nothing to do with funding them or investing in them.

What is really sad about this bill is that it actually is not going to do anything to make electric vehicles more attractive to people who would like to purchase them. Treasury gave that advice to the Minister and to the Government. It said, very clearly, that the major barrier to people buying electric vehicles is the upfront purchase price, and so unless we have a policy that does something to reduce the expense of buying a new electric vehicle, people are not going to be able to do it. So I think it is a bit disingenuous and a bit hypocritical, really, for the Minister, who is on a very high salary and can afford to buy an electric vehicle himself, to go out there exhorting people and businesses to buy electric vehicles when he has not actually done anything to make it more affordable and realistic for them to make that purchase.

Of course, the worst part of this bill—the one part that we really do not support—is allowing electric vehicles to use bus lanes. That is actually going to be incredibly disruptive to the operation of public transport in our major towns and cities. That is completely counter-productive when we are trying to reduce carbon pollution from transport and we are trying to create cities that are more livable, more affordable, and easier to get around. The facts are that allowing electric vehicles to use bus lanes will make traffic worse for people in the bus lanes and people outside the bus lanes. We have the numbers to back that up. It is funny, because Minister Simon Bridges said to me earlier that the reason Auckland Transport and all the transport planners did not support the policy was that they were left wing. I informed him that in fact—

Hon Simon Bridges: And now you wonder why I can’t be honest with you, Julie Anne.

JULIE ANNE GENTER: Geometry is not right or left wing, Simon. It is not right or left wing; it is just geometry. And the geometry of it is that buses move many more people than cars do, so buses are a far more efficient way of moving lots of people around towns and cities than individual cars are.

Debate interrupted.

The House adjourned at 10 p.m.