Tuesday, 3 July 2018

TUESDAY, 3 JULY 2018

TUESDAY, 3 JULY 2018

The Speaker took the Chair at 2 p.m.

Prayers.

Sittings of the House

Sittings of the House

Hon CHRIS HIPKINS (Leader of the House): In accordance with what has now become a reasonably well-accepted practice around the House, I seek leave for the House to suspend for the dinner break following the maiden statement of Dan Bidois this evening.

SPEAKER: Is there any objection to that course of action being followed? There is none. I’ll just inform the House that it is my intention to do what has also become a practice of the House, and that is to interrupt the speaker at 5.45 rather than stopping before or afterwards, so that Mr Bidois has his appropriate time.

Oral Questions

Questions to Ministers

Prime Minister—Prison Population and Appointment of Deputy Commissioner of Police

1. Hon SIMON BRIDGES (Leader of the Opposition) to the Prime Minister: Does he stand by all of his Government’s policies and actions?

Rt Hon WINSTON PETERS (Acting Prime Minister): Yes.

Hon Simon Bridges: Is he concerned that his Minister of Corrections didn’t know about the November prison population figures publicly released last week when he made the Waikeria announcement?

Rt Hon WINSTON PETERS: I am concerned when someone in this House seeks to repeat the misinformation of a very tawdry morning radio show. The reality is that my colleague was well aware of the November and then 4 December calculations and figures and forecasts, on which the forward prison programme and planning was based. But he was asked about a different report—namely, the one he’d received just a few days beforehand, the more expanded report—and he was telling the full truth, and then he received the gibe, “But this report’s been out for months.” Right then, that was a false statement by the questioner, and that member has taken up on it as well.

Hon Simon Bridges: What is this other, earlier report he was basing what he’s said and done on, and can we see it?

Rt Hon WINSTON PETERS: The answer to that is that member’s party has already requested it under the Official Information Act, so he should actually read it. [Interruption]

SPEAKER: Order! I’m going to remind members of the Opposition that they are not to bring me into these questions, either directly or by way of interjection.

Hon Simon Bridges: Isn’t the reality that there’s only one primary report, the justice sector projections one, from November that, as I say, all Ministers, and certainly the corrections Minister—

SPEAKER: Order! The question’s been asked.

Rt Hon WINSTON PETERS: The reality is that that is precisely what this Government’s answer is. There was the November report, which was bedded down on 4 December last year at Cabinet, and that was what my colleague Kelvin Davis was basing his answer on. But, of course, the questioner, namely the Leader of the Opposition, is repeating the very false statement that was made by the interviewer yesterday on morning TV. And third, why doesn’t he ask his colleagues who’ve requested this information under the Official Information Act and get them to read it or, better still, himself read it?

Hon Simon Bridges: Is it concerning that the most senior Labour Party Minister can’t remember what the advice he received says and, instead, needs to google information that he was told about several months prior?

Rt Hon WINSTON PETERS: I’m afraid that the chronological evidence behind that member’s allegation simply fails. And, in failing on the first grounds, it gains no more size, weight, or evidentiary quality in the second and third round.

Hon Simon Bridges: In light of the justice sector November prison population report showing an extra 2,000 prison beds forecast and also Corrections’ estimates that more police will require an extra 900 prison beds on top of that, what are the Government’s plans to deal with this?

Rt Hon WINSTON PETERS: Well, first of all, the member should understand that it was not a target. It was a warning and a forecast that even now, with this visionary, responsible, far-sighted Government, has seen those forecasts being turned down, which surely points to this policy working in the long run and not beleaguering the New Zealand taxpayer at $100,000 a year per prisoner.

Hon Simon Bridges: In light of the Prime Minister referring to the long run, in the short to medium term will the Government now follow the evidence presented to it and build more prison beds required, or is the answer to soften the bail, the sentencing, and the parole laws? Which is it?

Rt Hon WINSTON PETERS: The member knows which it is because that policy has been announced by the Government with great clarity, and it has been backed up by the fact that for the first time for a long time, we’ve seen a turn down in the number of prisoners in this country. And, more importantly, when we apply more lawyers and more judges to deal more immediately with people who are offenders so the bail numbers aren’t there for 12 months, we will see the figures get better as well.

Hon Simon Bridges: In light of the prison forecast set to rise by thousands and the answer that the Prime Minister’s referred to, being a 600-bed prison, what more is he going to do to deal with this issue?

Rt Hon WINSTON PETERS: We know—

Hon Simon Bridges: Doesn’t know.

Rt Hon WINSTON PETERS: Well, 1,500 beds in the ensuing months, but we’re not going to build a 3,000 mega-prison, American style, so that he can have it privatised so that crime pays for the owner.

Hon Simon Bridges: Did any Ministers declare any conflict of interest in relation to the appointment of Wally Haumaha as the Deputy Commissioner of Police?

Rt Hon WINSTON PETERS: No, because no conflict of interest exists and, more particularly, the Cabinet Office has investigated this matter and that is their finding as well.

Hon Simon Bridges: Were Wally Haumaha’s comments in relation to the allegations against Louise Nicholas known by any Minister and raised during any discussions about his appointment?

Rt Hon WINSTON PETERS: Can I say that I can’t speak for all my colleagues because I don’t know who read the Austin report or not. However, I can only assume that he and his colleagues weren’t aware of it when they gave Mr Haumaha two honours, not one.

Hon Simon Bridges: Does the Prime Minister think there would be a conflict of interest if a Minister was appointed to initiate an inquiry into someone who was asked to run as a candidate for election from the same party?

Rt Hon WINSTON PETERS: How amazing—I know a lot of people who, first of all, try to be members of the National Party and then, very late in their desires for a professional career in politics, come to the light, come to their senses, and they never want to go back there again, and I understand why. So, no, we do not hold it against people for having a temporary association with a political party or temporarily flirting with a political party, which I know members over there have done countless times, in terms of the number who’ve come to me to ask me if I could help them out.

Hon Simon Bridges: When did he disclose to Jacinda Ardern that Wally Haumaha had been a New Zealand First candidate?

Rt Hon WINSTON PETERS: The first thing that we don’t do is make something up that’s not true. Mr Haumaha was never a candidate, and the Rotorua Daily Post is not accurate in this matter—plus it doesn’t actually say that, does it, Mr Bridges? It doesn’t say that. Come on, read it out and tell everybody. You’re the Crown prosecutor that knows everything about the law. Well, actually, the words are very important.

Hon Simon Bridges: Does he dispute the Rotorua Daily Post from 2005 when it said last month Mr Haumaha was announced as NZ First’s Rotorua candidate but then the party backtracked and said he was a representative but not a candidate?

Rt Hon WINSTON PETERS: Very sadly, Mr Bridges, that story is not true. We’ve been through—[Interruption] No, no, the candidate part—we’ve been through all the 2005 papers, the whole procedure. He was never, ever announced as a candidate—end of story. [Interruption]

SPEAKER: I’m just waiting for the House to settle in both front rows.

Families Package—Reactions and Targeting

2. TAMATI COFFEY (Labour—Waiariki) to the Minister of Finance: What reactions has he seen to the Government’s Families Package?

Hon GRANT ROBERTSON (Minister of Finance): The Government has received very positive feedback on the Families Package. I’ll take just one example of a person who wrote in and said, “I just wanted to say a heartfelt thank you for increasing the family tax credit. I received the increase today, and I cannot tell you what a relief it is to have some extra money to meet our bills. I have never felt motivated to contact an MP or the Prime Minister before, but this certainly deserves acknowledgement and thanks. I have not voted in years, such was my level of dissatisfaction in people available to vote for. However, I am so glad I placed my faith in you, and it was you who reengaged me to vote.”

SPEAKER: I’m going to warn the member that he will lose his supplementary if he does that again.

Tamati Coffey: What reaction has he seen from commentators on the impact of the Families Package on the economy?

Hon GRANT ROBERTSON: A number of commentators have pointed out the positive impact the Families Package will have on the economy. Last week, ANZ said that the economic cycle has further to run yet and that quarterly GDP growth will pick up later this year, boosted by income growth and fiscal stimulus. The BNZ said that they see a substantial boost to the economy as a result of the package, with growth climbing back up to 3 percent by the end of the September quarter. This Government’s plan supports hard-working families and growth at the same time.

Tamati Coffey: What reactions has he seen to the winter energy payment?

Hon GRANT ROBERTSON: I saw a very confused reaction to the winter energy payment on Morning Report yesterday. First, the person said he disagreed with the winter energy payment being universal, because he would prefer a more targeted approach. Then he reminded us that he supported a universal tax cut for the very same amount, for these very same people, who he just said didn’t need the support. In the end, he said, “This is a targeted Families Package. That’s not necessarily a wrong thing.” I thank Mr Bridges for his support of something that is not the wrong thing.

Hon Paula Bennett: What reaction has he seen from the public on a senior earning over $330,000 a year, plus superannuation, plus the baubles of office, deciding not to opt out of the winter payment?

Hon GRANT ROBERTSON: I haven’t seen a lot of reaction to that particular decision, but I’m interested to note that the member’s aversion to universalism is clearly a sign that New Zealand super would be gone if that lot ever got back over here.

Rt Hon Winston Peters: Does the member see any similarity, in terms of policy formation, between his policy and the universality of superannuation, or has he had reports that suggest we should means-test the whole darned lot, like the National Party did when they were last in power?

Hon GRANT ROBERTSON: It’s quite clear, from the comments coming from the other side of the House, that there is some enormous problem with universalism. On this side of the House, we actually believe that people in their retirement deserve a bit of support. We’ve given a bit extra for the winter energy payment; that lot want to take it away.

SPEAKER: Just before the member calls—because I saw some confusion from the backbench at my earlier interjection with regard to Mr Coffey—I want to remind members asking questions that their microphones are open and that they are therefore not allowed, when they’re called for a supplementary, to continue to clap.

Hon Amy Adams: Is he concerned by Treasury’s advice on the Families Package, that 1.7 million families—that is 75 percent of all households—will, in fact, be worse off as a result of this Government’s changes, given his new-found commitment to universality?

Hon GRANT ROBERTSON: A large chunk of those families are people like Ms Adams and myself, who would have got a $1,000 tax cut.

Hon Amy Adams: So why the winter heating bonus?

Hon GRANT ROBERTSON: On this side of the House, we are more than happy to stand on a record of redirecting the majority of that money to families with children, who have missed out over the nine years of her Government. In terms of the winter energy payment that she’s interjecting about, can I note that the “worse off” equates to 10c a fortnight because of an accounting treatment, nothing else.

David Seymour: Does the Government have any plans to make Working for Families universal at one rate for every household?

Hon GRANT ROBERTSON: No, we don’t. And if the member is suggesting that all payments in our system should be universal, that would make a remarkable transition for the ACT Party.

David Seymour: So is the Minister saying that some payments are universal and some aren’t; if so, why is the winter energy payment universal?

Hon GRANT ROBERTSON: The winter energy payment is universal for people on superannuation and for main beneficiary recipients. He doesn’t get it; so, therefore, it’s not universal overall.

Business Confidence—Actions and Reports

3. Hon AMY ADAMS (National—Selwyn) to the Minister of Finance: Does he stand by all of his statements, policies, and actions?

Hon GRANT ROBERTSON (Minister of Finance): Yes, in the context that they were given, made, and undertaken.

Hon Amy Adams: Will he pay more attention to the latest New Zealand Institute of Economic Research (NZIER) Quarterly Survey of Business Opinion released today than he has to previous reports of declining confidence, given that we now have a series of indicators showing a sharp increase in pessimism in the economy, with the decline in business confidence in this survey to a net 19 percent of businesses expecting economic conditions to worsen in the second half of the year?

Hon GRANT ROBERTSON: I take seriously the concerns of business and business sentiment, but we have to look at the economy as a whole. We’ve got a strong surplus, unemployment’s low, there’s going to be a sustained period of growth, employee confidence is up, consumer confidence is steady. There’s a lot more to the economy than one survey.

Hon Amy Adams: Well, given his repeated pointing to own activity measures, does he agree with NZIER, whose survey reported an 8 percent decline in businesses’ own activity, which they say, “point[s] to softer economic growth in the second half of 2018”, being now the second business survey in as many weeks to have own activity figures falling to single digits?

Hon GRANT ROBERTSON: The member’s statement at the end there is factually correct, but I continue to implore her to look at the long-term correlation between business confidence and GDP growth, and to note that in the years between 2000 and 2009 there was, on average, 3.2 percent growth, and around 82 of 99 months were seen to be pessimistically viewed by business.

Hon Amy Adams: Well, is he going to take any responsibility at all for businesses in the NZIER survey reporting that cost pressures have increased sharply, indicating these costs will be passed on to consumers at an increased cost of living?

Hon GRANT ROBERTSON: I’ll take responsibility for the fact that this Government is finally getting on with funding, for example, transport, which for nine years was ignored by that side of the House, who now cry foul because we’ve actually decided to fund our transport plans rather than the billions of dollars that Simon Bridges left as a gap in Auckland transport.

Hon Amy Adams: Will he be speaking with his colleague Shane Jones, the self-appointed champion of the regions, as to why, according to this latest NZIER survey, pessimism remained pervasive across the regions, and in particular in Taranaki?

Hon GRANT ROBERTSON: Nine months in, we’ve set up a Provincial Growth Fund that’s putting out millions of dollars into our regions. It will put a billion dollars out over this year and another $2 billion over the next two years. That means this Government will have done tenfold more than the previous Government to grow our regions.

Hon Amy Adams: When will he acknowledge that his Government’s policies, such as higher fuel taxes, shutting down oil and gas, and pro-union industrial relations reforms are a core driver of business confidence plummeting under his watch?

Hon GRANT ROBERTSON: I’ll repeat what I said in my first answer. There are a lot of measures of the health of the economy. One of the most important of those measures is the fact that we have a surplus, that unemployment is coming down, that we actually have sustained growth in the future, and that confidence is shared across the economy. Employee confidence is up, consumer confidence is steady, and we’re working with the business community to lift their confidence.

NCEA—Review and Consultation

4. Hon NIKKI KAYE (National—Auckland Central) to the Minister of Education: Does he stand by his statement that “Education is too important to be left to politicians”; if so, is he confident that he is listening to all of the voices in the education sector?

Hon CHRIS HIPKINS (Minister of Education): Yes, absolutely; and yes, in so far as practical constraints allow.

Hon Nikki Kaye: If he is listening to the NCEA coalition of principals, then will he agree today to extend the time line of the NCEA review, given the concerns raised by this group of principals?

Hon CHRIS HIPKINS: There’s a broad range of views amongst the principals, including from the coalition of principals who took out a full-page advertisement in the newspaper over the weekend to express their views. What I have said in response to that is that, at this point, I’m not proposing to extend the time frame—there’s still 2½ months to go on the consultation—but if, at the end of that consultation period, it is clear that people don’t feel that they’ve had an opportunity to have their say or have their voices heard, then I’m absolutely open to extending the time frame further.

Hon Nikki Kaye: If he is listening to the coalition of principals, will he ensure that there is greater balance on the ministerial advisory group, given the concerns raised by this group?

Hon CHRIS HIPKINS: The ministerial advisory group have, effectively, done the job that they were appointed to do, which was to produce the discussion document. We’re now in a broad and open and public consultation period, where we want everybody to have a say in that. That’s being overseen by a group of principals and the Ministry of Education. The feedback we get through the consultation period is being analysed independently, by the New Zealand Council for Educational Research. If the advisory group has a further role beyond the production of the discussion document, then, again, I’m open to considering whether other voices need to be involved in that process.

Hon Nikki Kaye: Why did he label these principals as having traditional views, and is he dismissing their views because they’re traditional?

Hon CHRIS HIPKINS: No, I think that’s actually a factual explanation of the views of some of the people who have expressed that. I want to be very clear that there is nothing wrong with that, and I believe that traditional voices need to be heard in this process, as I’ve made very clear over the weekend, when I was asked about that. Other voices also need to be heard. I don’t agree with the assertion put forward by the principals that the Government is placing too much emphasis on the voices of young people in this process, for example. I think young people’s futures are what we’re talking about and they have every right to be heard in this. I absolutely reject the assertion put forward by one of those principals yesterday morning that this is a matter for adults to discuss.

Jan Tinetti: What responses has the Minister seen from secondary school principals to the NCEA review?

Hon CHRIS HIPKINS: In addition to the feedback that I received over the weekend, at the time the consultation document was released, the Otago Secondary Principals’ Association secretary, Gavin Kidd, said, “I think there’s general agreement that this is a step in the right direction, and it’s well overdue.” Patrick Walsh, principal of John Paul College, said, “The NCEA directly affects not only students and their parents but employers, community groups, business leaders, sporting bodies and voluntary organisations, to name but a few. If we want a high quality change we must first have quality engagement and feedback.” I had not received any letters or emails from any of the current principals in the new principals NCEA coalition until this Sunday, but I welcome their engagement.

Hon Nikki Kaye: In light of the fact that, in the last half an hour, the NCEA coalition group grew to over 50 schools, does he consider Massey High School and Northland College as having principals with traditional views?

Hon CHRIS HIPKINS: As I’ve been very clear, some of the people on that group have very traditional views. There are a wide variety of views on the NCEA, and I think it’s very important that everybody with a view on the NCEA has an opportunity to be heard in this process.

Hon Nikki Kaye: If he is listening to the coalition principals, will he agree to personally meet with this group that now is over 50 schools; if not, why not?

Hon CHRIS HIPKINS: Up until they took out an advertisement in the newspaper over the weekend, that group had not asked to meet with me. I have been very clear that I am open to engagement. For example, I already had, prior to the weekend, meetings scheduled with the Secondary Principals’ Association of New Zealand, where over 100 secondary school principals will be in attendance. The Secondary Principals Council have already held a meeting with 50 secondary principals from around the country and have already provided feedback on that. I have also, in addition to that, as a result of the request over the weekend, set aside time—Friday, two weeks from now—to meet with any secondary principals from Auckland who wish to meet with me. That’s an open invitation, and I’m more than happy to engage with any of them.

SPEAKER: I’m just going to warn the Leader of the Opposition that the next time he interjects inappropriately, he will have to withdraw and apologise.

Housing—Ownership, Policies, and Reports

5. MARJA LUBECK (Labour) to the Minister of Housing and Urban Development: What recent reports has he seen on the increasing number of New Zealand families locked out of home ownership?

Hon PHIL TWYFORD (Minister of Housing and Urban Development): A report by Auckland Council’s chief economist released yesterday highlights the lack of affordable homes for families on middle incomes—people who were traditionally homeowners. The chief economist notes that these middle-income groups have been increasingly locked out of homeownership. The same report shows that families with a household income over $95,000, which is the majority of Auckland families, will be able to afford the first KiwiBuild homes, which are expected to cost $579,000. I also note that outside Auckland and Queenstown, the price cap is $500,000, making those homes affordable for most families.

Marja Lubeck: Which families have experienced the worst decline in homeownership?

Hon PHIL TWYFORD: Data from the household economic survey shows that the biggest fall in homeownership has been experienced by families who were traditionally homeowners in New Zealand—that is, young families on middle incomes, with children. The income range from about $80,000 to $189,000 comprises half of all families with children and has experienced the most severe decline in homeownership in recent years. Even couples such as teachers, tradies, and office workers whose combined household income may be in the range of $150,000 struggle to afford a home.

Marja Lubeck: What is the Government’s policy towards families on lower incomes who can’t afford to buy?

Hon PHIL TWYFORD: Homeownership is out of reach for too many people. That’s why we are improving renting by modernising the tenancy laws, implementing insulation and heating standards, and building more State houses. Also, there are families who would like to, but cannot, afford a KiwiBuild home, and that’s why we are developing a shared equity scheme that will make it easier for so many families to own their own home.

KiwiBuild—Eligibility and Costs

6. SIMON O’CONNOR (National—Tāmaki) to the Minister of Housing and Urban Development: Does he stand by his statement in relation to KiwiBuild that the Government will build “high quality, modest, affordable starter homes”?

Hon PHIL TWYFORD (Minister of Housing and Urban Development): Yes. For example, the homes that we’re building at McLennan will cost only just over half the average Auckland house price and will be affordable to more than half of Auckland families. At 99 to 112 square metres for a three bedroom home, they are modest starter homes compared to the average new home built today, which is 172 square metres. I’m confident that these will be quality homes that Kiwi families will enjoy for generations.

Simon O’Connor: Does he agree with Auckland Council’s chief economist that the “KiwiBuild scheme is likely to be out of reach for half of Auckland’s households”, and that such a household would need to be making over $105,000 a year and would have to have a 20 percent deposit?

Hon PHIL TWYFORD: It’s not new that houses in Auckland are out of reach for many Kiwi families. That is why we have the KiwiBuild policy to build homes for less than $650,000. It’s why we are intervening in a failed market.

Simon O’Connor: In light of that, does he agree with the Acting Prime Minister’s statement around affordability that it would be desirable to have house prices drop to five times the annual living wage; and if so, does this mean that people who already own their houses will see their equity collapse?

Hon PHIL TWYFORD: I agree with the Acting Prime Minister when he said that it would be good to reduce the median multiple, which currently stands at around 10 in Auckland and 11 in Queenstown—that is, the median price of a house in those markets is, in the case of Auckland, 10 times the median household income. I agree with the Acting Prime Minister when he said it would be good to reduce that multiple to five.

Simon O’Connor: Was the KiwiBuild eligibility criteria on the Cabinet agenda on Monday?

Hon PHIL TWYFORD: Yes.

Simon O’Connor: If it was on the agenda on Monday, how does he reconcile this with the Acting Prime Minister’s suggestion that there was no discussion of it, it was among a tranche of papers that went through automatically and had not been on the agenda?

SPEAKER: Order! I don’t think there’s any responsibility for—oh no, answer the question; it’s probably easier than having the argument.

Hon PHIL TWYFORD: There was no discussion of the item because it was adopted by Cabinet unanimously. All the discussion was had at Cabinet committee.

Simon O’Connor: So how can the New Zealand public have confidence in Ministers who seem to routinely slip things past their colleagues in unexamined, undiscussed heaps of paper?

SPEAKER: No, no—far too much irony in that.

Health Services—Counties Manukau District Health Board Review

JAMI-LEE ROSS (National—Botany): I seek leave for this question to be held over as a new question for the next time when Dr David Clark is available to answer it.

SPEAKER: I think you’d better add in the word “additional” if that’s what you really mean—

Jami-Lee Ross: Yes, yes.

SPEAKER: —because you can have a new question any day. You just write it down.

Jami-Lee Ross: I would like to add in the word “additional”. Thank you, Mr Speaker.

SPEAKER: OK, the question is that the question be held over as an additional question next sitting day. Is there any objection to that? There is objection.

7. JAMI-LEE ROSS (National—Botany) to the Minister of Health: When was he first told of the Beattie Varley review into audit matters at the Counties Manukau District Health Board, and what action, if any, did he take when those audit matters were raised with him?

Hon JULIE ANNE GENTER (Associate Minister of Health) on behalf of the Minister of Health: On behalf of the Minister, on 3 November 2017, the Ministry of Health advised me that it had commissioned a review into financial and management practices at Counties Manukau District Health Board. The first time I was notified that Beattie Varley was undertaking that review was on 17 November. On 16 December 2017, I confirmed that Beattie Varley were to proceed with the interview process.

Jami-Lee Ross: When Stephen McKernan was announced as Director-General of Health on 21 December, did he seek an assurance from the State Services Commission that Mr McKernan would appropriately manage any conflict in relation to the reviews of audits involving Mr McKernan’s time as the CEO of that district health board?

Hon JULIE ANNE GENTER: On behalf of the Minister, as I said to that member last week, I absolutely trusted Mr McKernan to manage any conflicts appropriately.

Jami-Lee Ross: When Stephen McKernan raised the Beattie Varley review into inappropriate salary transactions during Mr McKernan’s time as CEO of the Counties Manukau District Health Board with him as Minister, did he take any action to ensure Mr McKernan was properly managing his conflict of interest around the review?

Hon JULIE ANNE GENTER: I have every confidence that Mr McKernan was appropriately managing his conflicts during this time.

Jami-Lee Ross: Does he believe it acceptable for the former CEO of a district health board, when subsequently serving as Director-General of Health, to raise with him directly a review of an audit into inappropriate salary transactions during that individual’s time as the CEO of that district health board?

Hon JULIE ANNE GENTER: I’m sure that member is aware that Stephen McKernan was CEO of Counties Manukau District Health Board from 2002 to 2006, and the items that are under review don’t go back further than 2013 in the report. So I do think that the member is clutching at straws.

Jami-Lee Ross: Has the Minister taken an opportunity to appraise himself of the terms of reference of the Beattie Varley review, which does in fact show that the inappropriate salary transactions dating back to Mr McKernan’s time were matters under review by Beattie Varley and the former Solicitor-General Mike Heron and Deloitte?

Hon JULIE ANNE GENTER: The Beattie Varley report is one that is being managed by the Ministry of Health. Officials at the Ministry of Health understand the seriousness of all of these matters. They’re working through a proper process, and it’s not my role to interfere with that.

Jami-Lee Ross: Do Ministers, including him, have any responsibility to ensure conflicts of interest are appropriately managed by the chief executive of the department that reports to them, when that chief executive was involved in a district health board that was under review and an audit was being provided to that individual as Director-General of Health?

Hon JULIE ANNE GENTER: On behalf of the Minister, yes, absolutely.

Student Loans—Borrowing Limits

8. Dr LIZ CRAIG (Labour) to the Minister of Education: What action is the coalition Government taking to address cost barriers faced for New Zealanders studying medicine, dentistry, optometry, or veterinary science?

Hon CHRIS HIPKINS (Minister of Education): Yesterday, I announced that the student loan borrowing limit for those students in long undergraduate programmes such as medicine will be extended to a maximum of 10 equivalent full-time student (EFTS) of study. This means that those students who have been unable to complete their medical degrees because they have reached the student loan cap will now be able to finish their studies in a timely manner and get into the workforce.

Dr Liz Craig: What response has he seen to this announcement?

Hon CHRIS HIPKINS: The announcement has been very well received. The New Zealand Medical Students’ Association has said the announcement is “a huge relief for many of our students, who can now focus on completing their medical degrees and serving their communities.”, while the New Zealand Union of Students’ Associations has said, “This doesn’t just benefit students, but also benefits the health and wellbeing of New Zealand.”

Dr Liz Craig: When will this change come into effect?

Hon CHRIS HIPKINS: The Government was intending to make this change in next year’s Budget, to come into force at the beginning of 2020; however, after listening to feedback, we have brought that forward. This change will now take effect from 1 January 2019.

Overseas Ownership of New Zealand Property—Exemption for Te Ārai Development

9. Hon AMY ADAMS (National—Selwyn) to the Associate Minister of Finance: Does he believe all his conduct in respect of the proposed exemption for the Te Ārai property development from the Overseas Investment Amendment Bill meets the standards expected of a Minister?

Hon DAVID PARKER (Associate Minister of Finance): Yes, but I note for the benefit of the member that it is the Prime Minister who is responsible for that assessment.

Hon Amy Adams: Did he just take Shane Jones and Kelvin Davis at their word, or did he seek legal advice to back up the claim that not granting an exemption for the specific Te Ārai land would cause a Treaty of Waitangi grievance?

Hon DAVID PARKER: My decision was informed both by my conversations with ministerial colleagues and the advice that I had from Treasury, which was in itself informed by legal advice.

Hon Amy Adams: Given that four of the Te Ārai lots listed in his proposed exemption appear to have no iwi ownership at all, and a further lot is subject to a registered lease in favour of Mr Darby’s interests for much longer than the exemption period, why were these particular lots included in the exemption?

Hon DAVID PARKER: For the reasons that I explained last week. I think, as I acknowledged then, that either the select committee or I could have looked at that further, and, indeed, had the exemption been carried forward, we could have done. I would note that, in respect of the underlying proposition which I put to the House repeatedly last week, we were concerned about the position of the iwi. I looked at the accounts for the year ended 31 March 2007 for Te Uri o Hau Settlement Trust, and it records that the settlement trust advanced to their investment arm $20 million to facilitate the purchase of the Mangawhai land. It was intended to be repaid from the sale proceeds. Due to the loss in value—this was some time ago—of the underlying asset, they’ve already suffered impairments of $14 million. Even after a $14 million impairment, this remains the largest investment of that trust, and we have sympathy for their position.

Hon Amy Adams: I seek leave to table the certificates of title for lots two, three, and four on depositor plan 138522 and the certificate of title for lot two on depositor plan 478524 and the leasehold title for lot one on depositor plan 478524.

SPEAKER: Is there any objection to those documents being tabled? There is objection.

Rt Hon Winston Peters: With respect to alleged underworld influences, is it a fact that Steven Joyce was backing the development, that Sir John Key was lobbying for the development alongside Michelle Boag, and that the Te Ārai submission was written by last year’s National Party chief of staff Wayne Eagleson?

Hon DAVID PARKER: Well, I’m sure that the members of the House are aware that there was lobbying by the Rt Hon Sir John Key—I wasn’t aware of that until last Tuesday night. There is a parliamentary record of the involvement of Steven Joyce, and I wasn’t aware, and I’m not aware, whether Mr Eagleson was involved.

Hon Amy Adams: Does he consider that it meets the high standards required of Ministers to take a paper to Cabinet recommending an exemption of significant commercial value without first having verified the ownership of the land to be exempted, with Treasury saying they didn’t know who owned the land when they drafted the exemption?

Hon DAVID PARKER: As I also said last week, the exemption only applied to residential lots. The golf course, the sand mine, any lots over five hectares, and any of the land that is already sensitive does not fall within the scope of the exemption, and the member should know that, because she was on the select committee.

Hon Amy Adams: How was he made aware of Mr Kayne and Mr Darby’s involvement in Te Ārai, which he says occurred on 6 March?

Hon DAVID PARKER: No, I actually didn’t. That 6 March date was a date that I picked in order to make a question in order last week. I think the time that I received detailed advice from Treasury on the Te Ārai submission was 19 March 2018, although by then I had also received submissions from Cabinet colleagues.

Hon Amy Adams: So isn’t it more likely that the reason he told the House, in previous questions, that the first time he became aware of Mr Darby’s and Mr Kayne’s involvement in Te Ārai on 6 March was because that was the day the New Zealand Herald published a story about Mr Kayne threatening to pull the plug on the development if he didn’t receive an exemption?

Hon DAVID PARKER: I wasn’t aware of that article.

Electoral (Integrity) Amendment Bill—Consistency with Existing Legislation

10. Hon Dr NICK SMITH (National—Nelson) to the Minister of Justice: How is his Electoral (Integrity) Amendment Bill enabling a member of Parliament to be dismissed consistent with section 23 of the Parliamentary Privilege Act 2014, that states, “(1) The House has no power to make a member’s seat become vacant by expelling the member (whether to discipline or punish the member, to protect the House by removing an unfit member, or for any reason or purpose) from membership of the House”, and “(2) Subsection (1) overrides any law to the contrary”?

Hon ANDREW LITTLE (Minister of Justice): The Government’s Electoral (Integrity) Amendment Bill is consistent with section 23 of the Parliamentary Privilege Act, because it does not provide for any member to be expelled by the House.

Hon Dr Nick Smith: How can the Minister say it does not allow a member of Parliament to be dismissed from the House when section 55B explicitly says that a leader of a political party serves a notice to a leader and, at that point, the member’s seat becomes vacant?

Hon ANDREW LITTLE: The actions of a leader of a political party and, indeed, members of the caucus of a political party represented in Parliament do not constitute the House.

Hon Dr Nick Smith: Does his Government continue to support the principle established 330 years ago with the Bill of Rights and codified unanimously by this Parliament in 2014 that voters alone get to dismiss MPs?

Hon ANDREW LITTLE: Yes.

Hon Dr Nick Smith: If he agrees with the principle that voters alone get to dismiss MPs, why is he promoting a bill, in this House, that gives the power to party leaders for a member’s seat to become vacant?

Hon ANDREW LITTLE: That member is, yet again, wrong when he says that the Electoral (Integrity) Amendment Bill provides for a leader of a political party represented in Parliament to remove a member of the House. The leader of a political party represented in Parliament, under the Electoral (Integrity) Amendment Bill, has no such power.

Hon Dr Nick Smith: How can the Minister claim that the leader has no power to dismiss a member of Parliament when section 55B in his bill specifically sets down the process for a leader to do just that, when his own officials before the select committee say that that’s what it does, and when over 21 constitutional experts have said that is what his bill does?

Hon ANDREW LITTLE: That member has misunderstood or mischaracterised the provisions of the Electoral (Integrity) Amendment Bill. No leader of any political party represented in Parliament, under the Electoral (Integrity) Amendment Bill, has the power to remove a member of Parliament.

Hon Dr Nick Smith: Why is his Government refusing to release the advice of officials on whether his bill is compliant with the important bill of rights?

Hon ANDREW LITTLE: I’m not quite sure what the member is referring to. The Attorney-General has provided a section 7 certificate in relation to the bill and finds that it is consistent with the New Zealand Bill of Rights Act.

uestion No. 9 to Minister

Q

Hon DAVID PARKER (Associate Minister of Finance): I should have done this at the end of my question. I seek leave to table an extract from the 2017 accounts for Te Uri o Hau Settlement Trust showing the loss to which I referred and that this remains, after that loss, their largest post-settlement asset.

SPEAKER: I do want an assurance from the Minister that it’s not a document that’s publicly available.

Hon David Parker: Well, I got it from the web, but it’s certainly—

SPEAKER: Well, I’m not going to put that leave.

Families Package—Reactions and Targeting

11. PRIYANCA RADHAKRISHNAN (Labour) to the Minister for Social Development: Will there be a social impact from the Families Package measures that came into effect on 1 July; if so, what would it be?

Hon CARMEL SEPULONI (Minister for Social Development): Yes. By 2020-21, around 384,000 families with dependent children will be better off, and approximately 650,000 families without children. As of 1 July, 26,000 more families are eligible for Working for Families tax credits, our Best Start tax credits are expected to benefit around 65,000 children born in the year, and around 1 million people will benefit from the new winter energy payment. There have also been increases to paid parental leave, the orphans benefit, the unsupported child’s benefit, and foster care allowance. As a result of our Families Package, 64,000 children will be lifted out of poverty by 2021.

Priyanca Radhakrishnan: What feedback has she received from expectant parents?

Hon CARMEL SEPULONI: I spoke to a number of expectant parents on Sunday. They expressed to me their excitement and relief. More than one couple stated the increases in paid parental leave, Working for Families, plus the Best Start payment will mean they now have the option of one parent staying home for longer with their newborn baby. Many couples also shared that these changes will go a long way towards lifting the financial pressure and making their job of raising children just that little bit easier.

Priyanca Radhakrishnan: What reaction has she received regarding the winter energy payment?

Hon CARMEL SEPULONI: I’ve received so much correspondence from individuals expressing their genuine gratitude for the difference this payment will make. One woman wrote, “Thank you very much for the winter energy payment. My son has autism and lives at home and gets supported living payment. I really appreciate that the Government cares about the least-privileged members of our community. Families affected by autism are often struggling, so an extra help is great.” Numerous organisations, including UNICEF, the Salvation Army, and the Child Poverty Action Group have all expressed positivity towards our Families Package. The Children’s Commissioner has said that this is an incredibly positive first step.

Hon Louise Upston: How many people earning over $100,000 per annum will receive the baby bonus?

Hon CARMEL SEPULONI: We’ve been very clear that the Best Start payment in its first year is universal; in its second and third year, at that point then it is means-tested, and at $79,000 it is abated. That, to me, is a very clear response to that member’s question.

SPEAKER: Well, sorry; it’s not to me.

Hon CARMEL SEPULONI: I don’t have the exact figures on me. However, we have been very clear—it is no secret—that the first year of the Best Start payment is universal.

Hon Louise Upston: How many people earning over $100,000 per annum will receive the winter energy payment?

Hon CARMEL SEPULONI: The exact same number that are currently eligible for superannuation, and I do believe that that side of the House has not changed their view on superannuation being universal.

Hon Chris Hipkins: Can the Minister confirm that fewer people earning over $100,000 will benefit from the winter energy payment or the Best Start payment than would have benefited from the tax cuts that were repealed in order to pay for those things?

Hon CARMEL SEPULONI: I think that’s a very important point. Under the previous Government’s proposal for the tax cuts, $440 million would have gone to the top 10 percent of income earners, and I think that’s a very important differentiation to make.

Prisons—Prison Population

12. Hon DAVID BENNETT (National—Hamilton East) to the Minister of Corrections: Does he stand by all his statements and actions?

Hon KELVIN DAVIS (Minister of Corrections): Yes, in the context they were made.

Hon David Bennett: Does he stand by his statement that he hadn’t seen the forecasts when he made the announcement in relation to Waikeria Prison, and, if so, why did he correct his answer three hours later to say he had seen dozens of reports on the forecast?

Hon KELVIN DAVIS: We’d been working off the forecasts since late last year, but I hadn’t seen the report that was released last week.

Hon David Bennett: If he had seen dozens of reports on the forecasts, what does the November 2017 report say that the prison population will rise to in 2027 under the higher settings that are projected?

Hon KELVIN DAVIS: If nothing else is done, the figure will be 14,399. But let’s also just bear in mind that the forecast for this year is meant to be 11,600. We’re currently tracking over 1,000 below that.

Hon David Bennett: I’d like to just table the actual report, which says—

SPEAKER: Order! Not a chance. It’s publicly available.

Hon David Bennett: OK. How was the 900-bed increase estimated by the Department of Corrections, due to the extra police, included in the November 2017 report, given these projections weren’t created until months after the report was finished and that the report does not try to estimate or accommodate any subsequent announcements or future Government policies?

Hon KELVIN DAVIS: In relation to the police projections, the police gave advice to the Minister of Police, Corrections gave different advice, and what we’re doing is hoping that the police are right, but we’re planning for the worst possible scenario.

Hon David Bennett: When did the Minister approve the release of the report, which was made publicly available on Saturday?

Hon KELVIN DAVIS: I’m not responsible for releasing that report.

Jami-Lee Ross: Mr Speaker, I apologise for not being able to seek leave for this at the time of my question, but I wish to seek leave to table a letter from Beattie Varley Ltd to the Ministry of Health relating to the review they undertook. If you may allow me, Mr Speaker—

SPEAKER: Give me the date.

Jami-Lee Ross: 17 August 2017.

SPEAKER: Is there any—[Interruption] No, no, the member—[Interruption] Order! The member will resume his seat. We’ve had a number of Speakers’ rulings on this particular area. The member has covered the subject matter of it. The member has covered the date and who it’s from. Is there any objection to that letter being tabled? There appears to be none. The member may table the letter.

Jami-Lee Ross: Mr Speaker, I was trying to explain to you there is a redaction in this letter for natural justice around two individuals that are former executives, whose names are redacted from it because they’re subject of the review, around their salary transactions.

SPEAKER: OK.

Jami-Lee Ross: That is the case with the letter.

Rt Hon Winston Peters: That should have been told to us beforehand.

SPEAKER: No, no. Order! To be fair to the member, I did interrupt him. Now we have all the facts, I will put the question again. Is there any objection to it being tabled? There appears to be none, still.

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

SPEAKER: Any further supplementaries?

Hon David Bennett: Yes.

SPEAKER: David Bennett. We’re going back to question 12.

Hon David Bennett: So when the Minister said that the Department of Corrections had made its own estimate for the number of increased beds that would be required as a result of the increase in police numbers, what is that number of increase in beds that the Department of Corrections has estimated, and when will he release that report?

Hon KELVIN DAVIS: The projected capacity for 2027, including the Corrections and police numbers, is 15,049.

Hon David Bennett: That figure of 15,049—what year is that based on?

SPEAKER: Well, the member just told him.

Hon David Bennett: He didn’t.

SPEAKER: Well, the member just said exactly that.

Hon Gerry Brownlee: No, he didn’t.

SPEAKER: Well, can I check. Did the member say 2027?

Hon Kelvin Davis: Yeah.

SPEAKER: He did.

Hon David Bennett: In 2027, the Minister has said the total number will be 15,049. Where does that reconcile with any justice sector projections, which say that the number is much higher than that?

Hon KELVIN DAVIS: The justice sector predictions don’t say it’s higher. But what we’re also saying is that these forecasts—the previous Government treated them as targets, and their target was just to keep building prison after prison after prison. We’re treating them as warnings and we’re doing something about it.

Bills

Taxation (Annual Rates for 2018-19, Modernising Tax Administration, and Remedial Matters) Bill

First Reading

Hon GRANT ROBERTSON (Minister of Finance) on behalf of the Minister of Revenue: I move, That the Taxation (Annual Rates for 2018-19, Modernising Tax Administration, and Remedial Matters) Bill be now read a first time. I nominate the Finance and Expenditure Committee to consider the bill.

This wide-ranging bill builds on recent work and represents a significant step forward in the modernisation of New Zealand’s tax system. It supports much of the work the Inland Revenue Department is doing as part of its Business Transformation programme. It represents an opportunity for New Zealand to transition its tax system to one where it is easier to get your tax right, compliance costs are lower, and Government policy changes can be made more quickly and cost-effectively.

The Taxation (Annual Rates for 2017-18, Employment and Investment Income, and Remedial Matters) Act, passed in March this year, laid the foundation for a smarter, more responsive tax system by ensuring that the payers of employment and investment income provide better and more timely information to Inland Revenue. With that in place, Inland Revenue is now in a position to ensure the right amounts are deducted—

DEPUTY SPEAKER: I’m sorry to interrupt the member, but we seem to have people standing there talking. Could they please respect the member on his feet?

Hon GRANT ROBERTSON: You don’t want me to start again?

DEPUTY SPEAKER: No, no—you can continue.

Hon GRANT ROBERTSON: With that in place, Inland Revenue is now in a position to ensure the right amounts are deducted or withheld from individuals to meet their obligations and more accurately determine entitlements such as Working for Families. This is primarily what this bill is about.

The proposed changes will apply for the 2018-19 tax year end processes, and the full benefit of the changes will be realised from the 2021 year, when, for the first time, people will be able to see a full year of pre-populated information for PAYE and all of their investment income. Most people will pay what they need to and get what they are entitled to during the year, without having to do anything. The changes, which would come into effect on 1 April 2019, subject to the passage of this bill, will help individuals to use the right tax code so they pay the correct amount of tax during the year. They will remove unnecessary compliance costs, simplify filing obligations, and ensure refunds are paid out automatically for most wage, salary, and investment income earners.

The changes proposed to secondary tax codes are intended to address this Government’s concerns about the over-withholding caused by secondary tax. These changes will enable Inland Revenue to more closely identify workers with more than one job who have been overpaying their tax. Inland Revenue will then be able to suggest a more appropriate withholding rate for the employee’s second job. In this way, we will remove the negative impact of secondary tax for those affected workers. Inland Revenue will make it easier for taxpayers to see what they’ve paid and what they owe and will be better at detecting errors. However, while more people will have income reported on their behalf, they will continue to be responsible for reporting other income and deductions, assessing their liabilities, and meeting their obligations. A modern digital tax system will serve the needs of all New Zealanders. It will help people to get their tax and welfare entitlements right the first time, avoid errors, and give them a clearer view of what they’ve paid and what they owe during the year.

The tax system will be simple to comply with and responsive to people’s changing circumstances. People will spend far less time and effort ensuring they meet their obligations and receive their correct social policy entitlements, as tax will be correctly withheld and assistance provided at the time it is needed. This is the key thing: developing a tax system that responds in near - real time to changes of circumstances without requiring a wash-up at the end of the year.

The bill simplifies tax obligations for individuals who currently apply for a personal tax summary or file a tax return each year in order to get a tax refund. The changes in this bill will mean that many of these people will be able to get their refunds automatically. Under the proposed changes, around 750,000 more individuals who don’t currently interact with Inland Revenue will be given a tax refund without having to do anything. These changes will mean that most people whose only income is from salary, wages, or investment will pay what they need to and get what they’re entitled to without having to do anything. These improvements to how individuals have their tax assessed constitute the main part of this wide-ranging suite of measures to modernise and simplify the tax system, and they have risen directly out of the new technology that Inland Revenue has been rolling out as part of its Business Transformation programme. The Commissioner of Inland Revenue, Naomi Ferguson, has assured me and the Minister of Revenue that these changes as a result of the Business Transformation programme, as well as other Government priorities, will be delivered on time.

In addition to the changes benefitting individuals, a number of other important changes are being made to the Tax Administration Act, but, again, these changes are focused on ensuring a simple and fair tax system. A key aspect of these amendments to the Act is to clarify Inland Revenue’s ability to collect, use, and disclose information. The changes proposed in the bill will make the rules more efficient and transparent, which will improve taxpayers’ trust and confidence in the way Inland Revenue manages the information it holds.

This bill clarifies that information collected for one Inland Revenue purpose can be used for the department’s other functions. It also provides a more transparent and efficient process for collecting large sets of data, where this is done on a regular basis. The proposed changes in the bill will better focus the confidentiality rule, to protect taxpayer information and more clearly set out any expectations. These changes strike the right balance between the stewardship of taxpayers’ confidential information and improved customer service. These changes help affirm this Government’s commitment to improving openness and transparency, while continuing to protect individuals’ private information.

Another proposed improvement to the Act is the introduction of a short process ruling, where small businesses can more easily apply for a binding ruling from Inland Revenue on a broad range of matters. Binding rulings are where taxpayers can apply to Inland Revenue for a ruling on a specific tax matter. Currently, this service can be prohibitive to many small businesses due to the time and cost involved. The ability for a wider range of taxpayers to obtain binding advice from Inland Revenue on their tax positions will assist in the goal of first-time accuracy. Therefore, the bill proposes to extend the ability to obtain private binding rulings to taxpayers who are, in practice, excluded from this because of the complexity of the process and the fees charged. This aligns with work the OECD has been doing to encourage first-time accuracy in its members’ tax systems, but, more importantly, it opens up a key service that the commissioner of revenue provides to a wider range of taxpayers and businesses.

This bill also provides the Commissioner of Inland Revenue with more flexibility to correct anomalies in the tax legislation. The bill proposes additional tools for the commissioner so that anomalies can be resolved earlier, therefore reducing taxpayer compliance costs by providing earlier certainty. The proposed new tools, comprising regulations, determinations, and administrative actions, will be subject to a number of constraints, including being optional for the taxpayer to apply, and being for a period of not more than three years.

The bill also proposes a suite of improvements to KiwiSaver as a result of the Retirement Commission’s 2016 review of retirement income policies. These changes range from introducing more choice for employee contribution rates to making it easier for our older working population to join and stay in KiwiSaver.

Other changes proposed in the bill include amendments to add 13 charities to the donee organisations—

Hon Member: Oh, you’re kidding!

Hon GRANT ROBERTSON: —with overseas purposes, in schedule 32 of the Income Tax Act 2007. Mr Bishop’s been waiting for that for years. It will allow taxpayers to switch to the accounting income method from either the standard or GST ratio methods at any time during the income year. The bill also sets the annual rates of income tax for the 2018-19 tax year.

Finally, the bill contains a large number of mainly technical amendments, and while mostly remedial in nature, these measures are of major importance in making sure that the existing tax rules work well in practice. The proposals in this bill make paying tax simpler and clearer for Kiwi taxpayers, and it is therefore my great pleasure to commend this bill to the House.

Hon PAUL GOLDSMITH (National): I stand to speak here on the Taxation (Annual Rates for 2018-19, Modernising Tax Administration, and Remedial Matters) Bill. On this side of the House, we agree with many of the provisions in this bill. In fact, most of them were started by the previous National Government and were part of a long process of tax development. However, we will not vote for this bill for a simple reason, and that is that it is fundamentally an annual rates bill. It sets the taxation rates, and those taxation rates are the same as they were last year, and they weren’t the rates that would have been in place if this Government hadn’t taken away the modest tax cuts that the previous National Government had enshrined in law prior to the Government.

So what we have in this bill: it outlines that there are four tax rates for personal income tax—it’s worth reminding New Zealanders of that. So for the first $14,000 an individual earns, they’re paying 10.5 percent tax rate; from $14,000 to $48,000, they’re paying 17.5 percent; from $48,000 to $70,000, they’re paying 30 percent; and above $70,000, they’re paying 33 percent. Now, if it weren’t for this Government’s changes post the election, we would have been paying different rates by now. We would have adjusted those rates for inflation over the past few years. It would have been from zero to $22,000 that paid 10.5 percent; $22,000 to $52,000 that paid 17.5 percent; and then the upper rate wasn’t changed. So the net effect of that would’ve been that anybody that earnt $52,000 or more would have kept in their hands more than $1,000 a year extra. That was all taken away by this Government, and we will not support this bill, on the basis of that change.

It was a modest adjustment, cancelled by this Government on the basis that it was too generous to higher-income families—they didn’t need the money, apparently. But I suppose the thing that makes people scratch their heads in New Zealand is the incoherent nature of this Government, because the day after they took away those modest tax cuts because too much money was going to wealthier families, they then gave those very same wealthier families access to $6,000 or $7,000 worth of free tertiary education. So I couldn’t understand the logic behind that necessarily. And they’ve done a whole lot of other universal handouts at the same time. So they oppose tax cuts—they don’t like leaving more money in the hands of New Zealanders, but they’re happy to give them much larger sums for free tertiary education.

So it’s incoherent, but it’s also unbalanced, because we were at a stage when the books had been managed for nine years very well. We’d gone from a massive deficit situation after the Christchurch earthquakes and the global financial crisis. We’d brought the books back into surplus, and we had choices as a country. When you have budget surpluses, you’ve got three options: you can reduce taxes—not you, but a sensible Government—spend more, or pay back debt. And it’s only appropriate that there should be some balance in that. We had modest tax cuts, we had signalled some extra spending, and we were paying back debt. This Government, of course, has changed the whole emphasis, purely and simply to spend more, spend more on every occasion. So the answer to every question is to spend more, and they are implacably opposed to any reduction in tax—notwithstanding the fact that inflation grabs a little bit more every year.

Of course, on top of that, they have brought in the fuel taxes that Aucklanders are paying and are very angry about at the pumps as we speak. The only people that are happy with the regional Auckland fuel tax are the owners of petrol stations around Franklin and somewhere north of Ōrewa, where they’ve seen a massive increase in people coming in to their things in order to avoid the fuel tax.

So we believe we should be leaving money in the hands of New Zealanders. The tax rates which are referred to in this bill should have been what National had put in place, and that would have put more money back in the hands of hard-working New Zealanders, and it’s a shame that it’s been taken away.

Now, if I can turn my attention in my remaining time to the positive elements of this bill, which are a legacy from some of the hard work and policy analysis of the previous National Government, and I commend this Government for carrying them on. In particular, I think people will be interested in the changes around KiwiSaver. I’m looking forward to the opportunity of working through these matters in the select committee over the next few months to ensure that they’ve got the details right.

Some of the things that we’re going to be looking at with this legislation are around—well, one thing, allowing people over the age of 65 to join KiwiSaver. Now, you might think, well, why would they want to do that? Well, actually, the funds management business in New Zealand is not huge, but, actually, some of the lowest fees available for people investing in managed funds are actually through the KiwiSaver products that are now building size and scale. You can actually get access to some good managed funds—whether growth, or balanced, or conservative—at reasonable fees through KiwiSaver providers. The law at the moment didn’t allow you to join over the age of 65 if you wanted to put some money away. Of course, you can always take it out at any stage over the age of 65, but you couldn’t put it in. The primary reason for that was because of the kick-start payment that used to exist but no longer does. So we think that’s sensible.

It also adds a couple of extra rates to KiwiSaver contribution rates. So at the moment an individual can choose to pay into KiwiSaver at 3 percent, 4 percent, or 8 percent. That’s not all that flexible, and so this bill includes a 6 percent and a 10 percent opportunity as well. I think that’s all important because the broader idea for KiwiSaver is to make it easier for New Zealanders to put a little bit of money aside for their retirement, not to replace the universal national superannuation that we have as a country that works well but to augment it and to increase their savings over time. So we want New Zealanders to have the ability, in times when they feel they have the resources available to themselves, to put a little bit more into their KiwiSaver funding, and that will all add up.

It also slightly limits the time available for a KiwiSaver contributions holiday, and that ended up being five years. We think that’s actually too long, because people can get out of the habit of putting into KiwiSaver, and will reduce the available funds that they’ll have later in life. So the proposal here is to reduce that from five years to one year and to change the name from “contributions holiday”, which is something that everyone likes the idea of—having a holiday—to a “savings suspension”. It’s a minor thing, but it does send a signal that we’re not talking about holidays here; we’re actually talking about suspending the opportunity to put some money away for retirement options. So we think that makes sense and we’re looking forward to working in the select committee about that.

Some of the more mechanical areas around the short process ruling, which has been mentioned by the Minister in his speeches—it is actually a very important area, which will enable small businesses to more easily apply for a binding ruling from the Inland Revenue Department on any tax matter. So it’s just a matter of when there’s uncertainty and when a business is not clear about what it can do, whether it can claim a deduction here or what their exact tax liability is, the current process in order to go for a tax ruling is very expensive and time-consuming and cumbersome. This process is much better tailored for small businesses so that they can actually get some clarity around their tax position earlier rather than letting things fester and get out of control. That is, I think, a reflection of the fact that the vast majority of companies in New Zealand are small. When we talk about small business in New Zealand it is actually very small business, and the resources that they have available for complicated tax planning are not huge. So I think that’s a practical way we can make a real difference to New Zealand businesses and maintain the integrity of the system.

The final area is around the personal tax summary in order to get a tax refund. This will—on the basis of all the investment that’s been made in technology—enable about 750,000 New Zealanders to get refunds due to them without having to go through actually applying for them, and the complicated system there, and again that makes sense.

So when we look at this bill there’s much that we support and we will work collaboratively with the Government through the select committee process to ensure that that is as good as possible, but we will oppose it on the basis that it represents a real missed opportunity to give to New Zealanders a little bit more money back in their pockets as tax cuts, which they richly deserved and which were taken away from them by this Government.

Dr DEBORAH RUSSELL (Labour—New Lynn): This is a sad, sad day in the history of this House, and it is a sad, sad day because for many years we have worked collaboratively across the House on tax measures. We have debated them tooth and nail in select committee to get them right, but, by and large, when it has come to voting in the House, tax bills have been passed unanimously with all sides of the House agreeing. In fact, this reflects a pattern in the way that tax is done in this country. By and large, people don’t ask for special concessions. People don’t ask for special rules. The objective of the tax professionals, the tax experts within the Inland Revenue Department, within the large accounting firms, within law firms has been to get the tax law right. The objective between Opposition and Government has been to get the law right. So when bills have come to the House, the tradition has been that that collaboration, that collegiality, means that bills are voted on unanimously.

Yet this Opposition is seeking to undermine all that, and on this sad day they have said that they will vote against this excellent tax bill. It is an excellent tax bill because of the way it improves tax administration. It’s an excellent tax bill because of the way it works for the small New Zealanders, for the people earning salaries and wages, for the people who need to have their tax processes simplified. It is an excellent tax bill because of the way it improves some of the rules around KiwiSaver, but they are still going to vote against it because it is also the annual rates bill.

May I suggest to the members of the Opposition that they could have done this differently. They could, perhaps at a later stage in the debate on this bill, have offered a Supplementary Order Paper around those rates and have argued their case there, but have still agreed to the bill overall. They had an opportunity to argue about tax rates during the Budget debate. They’ve had plenty of time to talk about tax rates, and because of their ideological commitment to it—their ideological commitment—they are going to undermine the established tax practice in this House, and that is why it is a sad, sad day. Shame on them, I say. Shame on you for undermining the way we do tax in this country.

DEPUTY SPEAKER: Not me—not me!

Dr DEBORAH RUSSELL: I agree, Madam Deputy Speaker, definitely not you. So, members of the Opposition, I invite you to reconsider. Please, think again. Make sure you actively support all the—

DEPUTY SPEAKER: Don’t bring me into the debate.

Dr DEBORAH RUSSELL: I am sorry, Madam Deputy Speaker. Please, members of the Opposition, actively support the excellent measures in this tax bill. Perhaps consider putting in a Supplementary Order Paper if that desire to debate the tax rates is so strong. But, at the end of the day, do not undermine the way that we as a House have tried for so long to get tax right. I urge members of the Opposition to support this bill, to vote for it, and, because of the excellent measures in this bill, I commend it to the House.

ANDREW BAYLY (National—Hunua): Thank you, Madam Deputy Speaker. It is a pleasure to be talking on the Taxation (Annual Rates for 2018-19, Modernising Tax Administration, and Remedial Matters) Bill. I’m going to start out with the good stuff that’s in this bill—and I think there is some good stuff.

First of all, I want to just reflect on the KiwiSaver changes. It’s interesting; there was a report that’s just come out earlier today saying that many young people do not understand how KiwiSaver works. Of course, if we are to provide an environment where New Zealanders do save for and look forward to and plan for their retirement, then it’s absolutely essential that they do have a very clear understanding of KiwiSaver, even though we’ve got the New Zealand superannuation scheme in place, and I think some of the changes in this bill will go a long way towards addressing some of those issues with KiwiSaver.

In particular, there are five key changes—and, I’ve got to say, these all reflect, basically, the report that the Retirement Commissioner prepared in 2016. The first one is that it removes what’s called the “five-year lock-in period”, which is something we agree with because, for those people who start putting money into their KiwiSaver from 60 to 65, they have a five-year lock-in period; so if they retire at 65, in some cases they cannot actually access their KiwiSaver savings account until later on.

The second one is that we think it’s a good thing that older New Zealanders who may not have invested in a funds-management approach to their retirement can actually put their money into KiwiSaver after the age of 65. I had one particular constituent who came to me on this matter some time ago and suggested this because, by doing so, it’s a way for older New Zealanders to use a proven method and funds-management approach to look after their funds in retirement.

The third one is around increasing the number of contribution rates. At the moment, we’ve got a slightly weird situation where you can introduce funds into your KiwiSaver account only at 4 percent, 8 percent, or, in fact, I think it goes to 12 as well. What this bill proposes to do is give greater flexibility by adding 6 and 10 percent as rates that the Kiwi person can recommend they want to contribute to their KiwiSaver account, and it therefore gives more flexibility. What we hear from many people—and what we have heard from many people—is that the jump from 4 to 8 percent is too high and, therefore, the 6 percent, in particular, is a very useful start.

The fourth element is reducing the holiday period from five years to one year. Of course, the way that operates is that when people get into financial difficulty or their financial circumstances change, what they can do is actually decide to opt out of their KiwiSaver contributions. At the moment, it’s set at five years. What this bill will do is give better flexibility and require that opt-out to take place every year, because what we do want is New Zealanders to actively think about that opt-out clause every year, so that, if they can, they actually get back on to the saving regime and continue to contribute to their KiwiSaver.

The last thing they’ve done in the bill is change the term—and I think it’s a good thing—from “contributions holiday” to “savings suspension”. It adds a bit of nuance around the wording, but I think it’s useful in terms of making it clear that if you are going to take a holiday, in a sense, what you are doing is deferring your savings from that period onwards—and that’s why we want the annual review.

Also, there are some changes in it around business packages, clarifying IRD’s ability to provide taxpayers who are not tax agents with an ability to get access and lodge PAYE returns and GST returns. At the moment, to be registered as a taxation agent, you have to go through a process. What this does is give the commissioner more flexibility around that. Also, in terms of determinations, there’s always the point where the commissioner can make a determination, but the bill provides a bit of flexibility in terms of the interpretation of the legislation.

Then the third main element is around personal tax changes, which are good in the sense that they remove the need for people to provide a tax return and also make the ability to get an automatic tax refund much more easily. The IRD can, effectively, look at your historical financial information and anticipate what tax code you’re going to have, and all those are good things in terms of getting money out of the IRD and back to taxpayers on a much quicker basis.

But it is a sad, sad day because what this bill does do is lock in the tax changes that the coalition Government wants to bring in under the so-called Families Package. The issue around the taxation package is that it’s good if you have a young family and you’re a lower-income family—and the family tax package deals with that in the Budget changes that the coalition Government proposed—but the issue is that if you are a student trying to save and earn money so you don’t have to take on a student loan—

DEPUTY SPEAKER: Don’t bring me into it.

ANDREW BAYLY: —the student will still pay a high level of tax on the minimum amount of money that they can make to be able to save for their studies. If you’re a young family—a husband and wife, or partners—without children, then the Families Package provides absolutely no benefit to you at all. Or if you’re a superannuitant, you, in the first year, will only receive a portion of the so-called $400 or $700 winter energy payment, because in the first year that is a considerably lower sum—it’s closer to about $340 because of the way it’s been introduced. On top of that, what’s happened, as we’re all aware, is that the coalition Government has now brought in a host of new tax revenue since election day last year.

On the current basis, $2.3 billion of additional taxes have already been introduced by this coalition Government. They include the fuel tax that we’ve talked about significantly over the last few weeks in this House, both at a local Auckland Council level and also at a Government level. We’ve talked about the Amazon tax, we’ve talked about the removal of the average income earner tax cut, and there’s a whole range around some of the business changes. And this is against the backdrop of a Government that is now raking in $73 billion and the tax take from this Government, over the foreseeable future, will rise to just under $100 billion without any additional tax being proposed. We know that there’s a working party beavering away right now trying to drum up new taxes to impose on unsuspecting New Zealanders.

The worst thing about this bill is that it locks in the same tax rates that all New Zealanders pay, and the technical term is “fiscal creep”, which means that, with inflation, as your income rises, you increasingly get pushed into a higher tax bracket even though, in real terms, you are not better off. That is the travesty of this bill, because that means that those average New Zealanders who are out there working hard, saving for their future, looking after their children, and, generally, trying to get ahead will be locked into higher tax rates than otherwise should be the case.

If this coalition Government had put in place the tax changes that the National Government had said they were going to put in on 1 April this year, then they would be much, much better off, and that’s what New Zealand should be about: fairer treatment for all, not just looking after a certain category of people, but ensuring that all New Zealanders share in the wealth of this country and can get ahead. Thank you, Madam Deputy Speaker.

FLETCHER TABUTEAU (Deputy Leader—NZ First): Thank you, Madam Deputy Speaker. It’s a pleasure to rise on behalf of New Zealand First to speak to this, the Taxation (Annual Rates for 2018-19, Modernising Tax Administration, and Remedial Matters) Bill.

I’m glad I get to follow Mr Bayly, because what Mr Bayly has done for me is highlight some of the inconsistencies in the National Party’s positioning on tax. For example, Mr Bayly spoke to the House about “fiscal creep”—or fiscal drag, just in case we made the mistake of thinking he was talking about himself. What the member opposite forgot to mention was that, for years, lobbyists and people would come to National and ask them to address this very issue, but year after year after year they refused to act to do anything about it. Now the accusations fly that this Government is doing the same. Well, Mr Bayly, let me put that into context for you.

You speak of our refusal to shift or decrease the annual tax rates. Let’s analyse that from the perspective of a small- or even a large-business owner, Mr Bayly. What that member has to realise is that what was happening under the previous Government was that those employees were struggling to get to work. They were, literally, spending over a month per annum in traffic to get to work every day in Auckland, and those members opposite refused to address the issue. They couldn’t, because they didn’t have the revenue. They didn’t have the money to do anything about it. What that meant for business was that there were huge losses of productivity, especially for our businesses in Auckland—huge losses of productivity. It was affecting the bottom line.

What about the education of our employees? The member decried the leaving alone of tax cuts, but what that has meant is that this coalition Government is able to invest so much more significantly into our education system, so that those people working in our businesses, contributing to the bottom line of our businesses, are making those businesses better off. They are more productive, by definition, Mr Bayly.

I’ve spoken about transport, but what about housing? What does it do to a business’ bottom line when their workforce isn’t sure where they are living from day to day, from week to week, or when our employees are moving across the country, trying to find a place to live? What does that do to the bottom line of a business trying to find people to work for them? It makes it next to impossible to find and hold on to good employees. So, actually, what we’re trying to do here, on this side of the House—never mind all the social issues and the cost to the individual and the cost to families—is make sure that New Zealanders are in a position to contribute in a positive way to New Zealand business, and you don’t do that, right now, by cutting our tax rate.

I just want to finish on the health of the employees of our businesses. What does it do for a business if the health system is not looking after a business’ employees? What does that do to the business’ bottom line when people are taking sick days because they can’t afford to go to the doctor, they can’t even access our hospital system? That is bad for business. That is fundamentally bad for business.

What I’d like to do now is be a bit more positive and actually acknowledge the Opposition now, and acknowledge that, yes, this legislation originated with the Opposition and the Inland Revenue Department’s desire to modernise their operations. So what we have here is that Inland Revenue went to the National Party and said, “Actually, we think that our operations are quickly becoming outdated. People’s access to our services is becoming antiquated as modern technology progresses.” So, good on the Government of the time—National; they said, “Well, what do you need?” And here it is: the solution put to National around the modernisation of the Inland Revenue Department and, actually, the tax system itself. It was, and continues to be, a huge undertaking by the Inland Revenue Department. I myself, in Opposition, had concerns about the sums of money involved, but those concerns have been addressed, because the Inland Revenue Department has been able to mark their progress in a positive way over recent times. There is confidence going forward, because the Inland Revenue Department forecasts are being backed up by the very numbers that they have given this House.

This has been a logical undertaking. It is a move into the modern world. It’s almost ironic that I use those terms, because, basically, email has become a lot more accessible and more of a tool for people to interact with the Inland Revenue Department and vice versa. This is legislation that enables this modernisation, this transformation process. And, as has been spoken to on both sides of the House, the main gains from this are around compliance issues and the cost of subsequent compliance, and the timeliness of Inland Revenue to respond to those broader issues. So what this legislation does is enable these changes so that compliance is not so arduous on the individual or the business. We have more timely transference of information, and, if I get time, I’ll give examples of where the tax department itself will be proactive in supplying individuals with their tax obligations, rather than the individual stressing and worrying about their tax obligations.

What I did want to touch on—and I hope this is where my notes start—is that through this bill, individuals automatically will be given the right code in terms of secondary tax. Let me try to explain. It’s been difficult for individuals to have multiple jobs and to ensure that they comply with their tax obligations. They’re often found wanting at the end of the tax year in terms of their tax bill. So what this legislation does is actually be proactive in the reporting of an individual’s tax obligations, such that a person working multiple jobs will have their wages and tax forecast out for an annual period. In doing that, there won’t be a need for a secondary tax code. They will know what their tax obligations are at that time and going forward, and they will be taxed at the correct rate. For me, as the New Zealand First spokesperson for revenue in the previous parliamentary term, that was actually quite a frequent interaction with hard-working Kiwis who were confused by the system and were frustrated by the system.

So, for me, this is quite a timely moment. I’m proud to be part of a Government that sees where good things need to happen. That means the arduous nature of secondary tax codes will be dealt with, and those people who are obliged to work multiple jobs—and there are many of them still—will find this whole interaction with the Inland Revenue Department so much easier, hopefully. I personally think that the removal of this obligation will be huge for families.

Look, that’s just one of many examples of what this piece of legislation achieves. I’m grateful to be able to support this bill through the processes of the House. Madam Deputy Speaker, thank you very much.

IAN McKELVIE (National—Rangitīkei): I wouldn’t really need to talk about this bill at all—the ammunition the past two speakers from the other side of the House have given me to talk about—but none the less I will. I think that I want to pick up on the points that the last speaker—“the Professor”—made in his deliberations on this bill. I just want to comment on a couple of things he said. One of the things I was intrigued by—

DEPUTY SPEAKER: You do need to use his proper name. In fairness, you do need to use his proper name.

Fletcher Tabuteau: Say my name, ha!

IAN McKELVIE: I’m not sure who I’m talking about—sorry, Mr Tabuteau.

One of the things he said earlier in his speech was people are struggling to get to work. Well, I can assure him those people in Auckland are now struggling by a significantly larger amount to get to work because they’ve got a whole lot more money they’ve got to pay to get themselves to work each morning. That was one of the issues I thought was really quite interesting to take up on the point of this bill.

The other thing I wanted to talk about briefly was—I think that on this side of the House we agree with a huge amount of the stuff in this bill, and certainly around tax we are normally almost unanimous on that. I want to touch on why perhaps we’re not in this case in a moment. But I just want to talk briefly about an issue that Deborah Russell made in her speech. She talked about the ideological difference of the National Party, and frankly that’s exactly why we’re opposed to this bill. We’re only opposed to a little bit of this bill, and it is purely the ideological differences, because if didn’t have ideological differences, we wouldn’t need a Parliament, would we? We’d all be in the same place. So that’s the thing that I’m finding interesting about this.

I want to talk about one or two things that have created that ideological difference, and earlier in the day Paul Goldsmith spoke about one or two of them. One of them is a simple thing like the winter energy payment, where for want of something better to do the Government have cancelled some pretty meagre, effectively, tax cuts and put in their place a winter energy payment, which is universal for all over 65, unless they reject it. They’ve also put in place free tertiary education for the same students of the same families that they objected to so much over the potential for the tax cuts to benefit a percentage of our population that were better off. I find that very interesting because, effectively, they’ve made those families much better off than the tax deductions or cuts ever would have made them. So that’s the ideological difference that we’re faced with in the course of this bill.

I think everything else in this bill—and I agree absolutely with the last speaker around the modernisation of the Inland Revenue Department and the technology base they operate off. If we can get that to work in the manner that it’s predicted it will work, it’s going to make it a whole lot better. Despite some of my rural accountant’s views on it at the moment, it will eventually work a whole lot better for almost every taxpayer in New Zealand. It will make their lives simpler, it will make the roles of accountants and tax advisers simpler—in fact, this bill just extends that definition a little bit and enables some other people to provide tax advice. I don’t have any issue with that as long as they are qualified to do it and do it in a manner that is acceptable to everyone. So there’s some issues in this bill I think are very positive, but there are also some issues in here that we think are not so positive, and that’s the reason for us objecting to it.

I want to make a couple of other comments. I had the opportunity to go to Norway a few weeks ago, where they do pay extremely high rates of tax—much, much higher rates of tax than we do. But the same country has a $9 trillion investment fund, which enables them to put infrastructure in place for their communities. All that $9 trillion has come from the North Sea and a couple of pipes they run out of there. We no longer have that opportunity, so I think that it’s a very interesting philosophical debate as to how you extract money from people and provide it to the Government to give them the opportunity to put infrastructure and—

Fletcher Tabuteau: They still tax the wealthy more.

IAN McKELVIE: —the like in place for all of us. I get a lot of advice from the Opposition on how to speak. I’ve got to say also that I never imagined I would come to Parliament and spend hours and hours talking about tax bills; I always imagined I’d come to Parliament and spend hours and hours talking about sheep, but it’s different.

The other thing I want to speak about—and, again, Bayly pinched some of my words on it—was the changes to KiwiSaver. I think KiwiSaver is hugely positive for New Zealanders. I also think it’s a hugely positive change to make to enable people over 65 to continue—to enable those contributions to continue to KiwiSaver, and enable them to commence making contributions to KiwiSaver. When I was young, people at 65 always looked very old to me. I can assure you now they don’t. I have had people in my office talking about exactly this issue, because it is frustrating for people that at 65 years of age their KiwiSaver employer contributions stop, and also they can’t join KiwiSaver if they wish to. KiwiSaver is very positive for New Zealanders.

The other thing I think’s a positive change about the KiwiSaver thing is changing the levels of contribution to KiwiSaver. I think that’s a positive step for New Zealand too. I think also that whilst superannuation is superannuation—it’s been a great thing, universal superannuation, for all New Zealanders. I don’t think there’s any doubt that in the future there’s going to be a need for Governments to look at retirement age. I think we need to be looking at that constantly, not because of what happens to us or even to the next generation of us, but what happens to the generation after that. I think that’s the key thing we need to be thinking about, so that’s hugely important for us as well, and KiwiSaver plays a part—a very important part—in enabling us to ensure that future generations of New Zealand will have enough money to survive on. So that’s my lot. Thank you.

MICHAEL WOOD (Labour—Mt Roskill): Thank you very much, Madam Deputy Speaker. I’m really delighted to be able to stand up and speak strongly in favour of the Taxation (Annual Rates for 2018-19, Modernising Tax Administration, and Remedial Matters) Bill in this, its very first reading. At the beginning of my comments, I just want to give a little teaser: a little taster of some of the outstanding benefits that this tax bill is going to offer New Zealanders.

We’ve quite recently come past the time of year at which many of us do our tax returns, and those people who make charitable donations through the course of the year will be aware that, at the moment, we have quite a cumbersome process whereby you sort of have to save up your receipts from the charity that you gave the money to, you put them in an envelope somewhere on your desk, and at the end of the tax year you have to fill out a special separate form—you can do it only via hard copy—and you’ve got to mail the receipts in, stapled to that form, if you want to get your return.

DEPUTY SPEAKER: I thank you for the advice, but could you not bring me into it.

MICHAEL WOOD: I’m sorry, Madam Deputy Speaker. The people of New Zealand can do this—although I’ll leave it there—to get their tax return done and to get their return on their charitable donations. One of the things that this bill does is it makes that process far less cumbersome for New Zealanders. It will enable people to file their receipts from their charitable donations at the very time they make that donation, so that they don’t risk losing the forms and, therefore, probably won’t end up getting the benefit of that donation back. It then enables them, effectively, to get a credit against those donations in with their income tax return at the end of the year, effectively bringing the two processes together. That is one of the small benefits that this bill offers New Zealanders, and it really speaks to the broader theme of the bill, which is about making our tax system simpler for New Zealanders, easier to access, and making sure that we treat people more accurately through the tax system at all points.

We’ve heard a number of speakers in the debate so far speak not about that point but about a number of the other areas in which the bill simplifies and improves the tax system. That is why, to my mind—and echoing the comments of my colleague Deborah Russell—it’s deeply disappointing that the Opposition, at this point of the legislative process at least, is choosing to, quite unusually, vote against this tax bill despite all of those things in there which are actually going to improve our tax system. On this side of the House, we know that the Opposition takes a different view in respect of tax rates, but, by tradition, this is a bill in which members of the House from both sides engage in the process and engage in the issues but, in respect of confirming the tax rates for the year, which is simply about making the tax rates of this current tax year actually appropriated in a legal way, there is generally unanimity around the House.

I’d actually encourage some of the members on the other side of the House who have spoken against this bill because of the tax rates to actually reflect on the comments of the Hon Judith Collins, who, only a little bit earlier this year, in a New Zealand Herald story, said that she didn’t think that she would go ahead with tax cuts if it was up to her, that they were not a priority for her, and that—here I quote directly from the Hon Judith Collins, the previous Minister of Revenue under the previous National Government—“What they’re saying to me is, and certainly in my area in South Auckland … is we need infrastructure,”—that is, instead of tax cuts.

So when we hear the passionate arguments on the other side of the House against this bill, because of the current tax rates and in favour of those tax rates being reduced, that is the question: what is the trade off? What is the trade off? If those rates are to be cut, what are they going to trade off? Are they going to trade off infrastructure improvements? I don’t think so. Are they going to trade off increased investment in our education and health systems? Are they going to trade off those measures that Mr Bayly, in his speech, referred to as being good for low-income people or people who have families—those measures in the Families Package that are going to lift 64,000 kids out of poverty?

That’s the thing about the tax rates: we know, on this side of the House, that there is no free lunch—there is no free lunch. If we want to invest in the social and the economic infrastructure of our country, we need the revenue to do so. And I have not yet heard one speech from one of those members who are going to oppose this bill telling us how they will bridge that gap.

As I said, there are many, many positive measures in this bill, and I just want to touch on a couple more of those. The first one is that—and this is one of the things that I was asked about a great deal in a previous role as Labour’s revenue spokesperson—this bill moves us towards a position of New Zealanders not having to pay secondary tax through the course of the year. You could talk to tax experts, and they would say, “Well, actually, the secondary tax system actually all sort of washes up in the end. We have to tax people that way, but they can get a refund, and it all balances out.” But the reality is that those New Zealanders getting hit with the impost of a higher secondary tax rate through the year on low and medium incomes often really struggle.

What is happening through this bill is that we are harnessing the benefits of the Business Transformation process, we are harvesting the benefits of previous pieces of tax legislation which allow the IRD to collect more accurate and timely information, and we are giving the IRD the tools to more accurately tax people, who may be in two or three different jobs, at the right tax rate at the right time, so that they don’t have to apply a higher secondary tax rate to that taxpayer. That is going to make life so much easier to those people who are often struggling week to week, month to month to pay the bills from their pay. I think that is huge progress, and there are going to be many, many New Zealanders who are very pleased with that measure indeed.

The final measure I want to touch on is the way in which this bill makes further improvements to our KiwiSaver system. KiwiSaver has been an enormous success. Over $40 billion of savings are invested through KiwiSaver schemes in New Zealand—one of the signal successes of the previous Labour Government. What this bill does is pick up on a range of recommendations to improve our KiwiSaver regime, fundamentally, to give people more options to feed into KiwiSaver. So we introduced two new rates of 6 percent and 10 percent. I think one of the speakers opposite previously made the point that jumping from 4 percent to 8 percent was potentially quite a high bar for people who might want to consider increasing their savings. By providing that 6 percent option, I’m quite confident we’re going to see more Kiwis in KiwiSaver and more Kiwis saving more through KiwiSaver, and that has got to be a good thing.

I’m very pleased this bill is coming to the Finance and Expenditure Committee. It’s a very hard-working and talented committee, with members from all sides of the House, and we’ll give this bill the rigour that it deserves. Tax is a complicated area. We need to look at it closely, we need to listen to the advice of officials, and we need to listen to the feedback that we receive from the public through the submissions process, and I’m sure that we’ll all do an assiduous job of that and make sure that this bill returns to the House in as good a shape as possible.

A message I would just like to leave for those members opposite is to say this: that, actually, what they’re doing in voting against this bill at this stage in the House today is a very unusual thing to do—it’s a very unusual thing to do. If they want to associate themselves with the good things in this bill that are going to improve our tax system, that are going to make things easier for New Zealand taxpayers and better for New Zealand taxpayers, that are going to ensure that people pay their tax accurately—if they want to associate themselves with those good measures—they can’t have it both ways. They can’t vote against it and then also take the political benefit of supporting those measures. So I think, between now and the further readings of this bill, I would encourage those members—and Mr Goldsmith, who led off the debate as the Opposition revenue spokesperson—to just reflect on that a little bit, and I would encourage them to engage in this bill and the measures within it in a constructive way so that we can improve the tax system and make it as effective as possible for all New Zealanders, which is what this bill will do, and I commend it to the House. Thank you.

ALASTAIR SCOTT (National—Wairarapa): Thank you, Madam Deputy Speaker. I too am pleased to contribute to this debate. I’ll pick up where Mr Wood left off and talk a little bit more about the KiwiSaver, because that is a part of the bill which has given greater efficiency and greater access to more people to be able to save for their retirement. That previously those over 65 were not able to participate seemed to me to be slightly an ageist proposition, and I’m pleased to see that those over 65 can now join KiwiSaver.

Also, the holiday break is now no longer a five year minimum; it’s a one year minimum—that’s also a good thing. People’s positions change. They may not have been able to afford to contribute for a short period and therefore take a holiday, but to be locked into that holiday for five years does seem excessive, so I’m pleased to see that break is brought back to a one year minimum.

The 6 percent to 10 percent are interesting changes—remembering, of course, that we’ve always been able to add or put in lump sum payments. But it is always useful to be able to increase the flexibility around KiwiSaver and the contributions that are made.

One thing I would like to challenge or ask the Government to consider—the question is: are we having enough people contribute into KiwiSaver? Are we getting everyone in that should be in to KiwiSaver? We know that not everyone is in KiwiSaver, and perhaps those that can least afford to contribute and save are not in KiwiSaver. So there’s a little challenge for the Government of the day to think about.

Next point I’d like to touch on is the real time—or “near - real time”, I think Grant Robertson mentioned—measurement of tax liability. That’s a good thing—especially the fact that 750,000-odd people will no longer need to file a return—because, of course, the information’s already there. If you’re a salary or a wage earner and you’ve got some simple, straightforward investments, there is really no need for one to file a return, because the information’s already coming in to the IRD from other sources—from your employer or from the bank or the broker that’s declaring and showing through the other channels that are feeding into IRD exactly how much an individual is earning over a month or six months. And, again, there’s flexibility in this bill to allow provisional taxpayers to change the mode of provisional tax payments. And that’s also a good thing.

I know that IRD are turning their mind to it, but the challenge is to use this technology to catch up with the few people that are not paying their tax. Particularly, I’m talking about child support payments. I’m talking about fathers who go from job to job and, when they do get caught up by the IRD, they move on to another job simply to avoid their obligations to their kids, who are being looked after by, usually, mum—and certainly not them. So I know technology is changing within IRD. I know that that information is now available because we’ve got this bill which tells me that it is available from sources other than the employee. So the challenge is to make haste—I challenge the department and the Minister to make haste in rectifying what is a challenge for kids that are not being supported and could be supported by their fathers who choose to avoid their obligations.

The next point I’d like to touch on is Mr Wood talked about bridging the gap—how are we to bridge the gap about building infrastructure and social and physical infrastructure? We’ve got to tax, apparently—apparently, the only way is to tax. Well, I’ve got the answer, Mr Wood, and that is to prioritise properly—that is to prioritise properly. Do not waste—do not pour it up against the wall—when it comes to taxpayer funds. I’m talking, of course, about the priority that’s being given to tertiary students, I’m talking about the priority that’s being given to Shane Jones’ slush fund, and I’m talking about the priority that’s being given to Winston Peters’ foreign affairs budget. That’s how you bridge the gap. That’s how you do not need to increase—or maintain, I should say—and cancel the tax cuts that were proposed and put in this legislation by the previous National Government.

Remember, and I think we’ve already heard in this House around the fuel tax—about $500, $700 per family. It doesn’t really matter what the number is, but I think we all have agreed that that is a regressive tax. That’s a tax that hurts those who can least afford it. It affects them the most. It’s a fixed number, essentially, of a fixed fee, and we’ve agreed that it’s a regressive tax.

Now what this Government has done is to cancel a progressive tax cut. That is, the same sort of amount—about $1,060—that was going to go to any family that earned over $52,000, and a little bit less for those who earned less. But, essentially, it was a universal payment to workers. That is the opposite of a regressive tax—a fixed, lump-sum tax. It is called a progressive tax cut because it benefits—it benefits—those who can least afford it out there, because it means more to them than it does to someone on a very high income. It is exactly the opposite of the regressive tax that we’re talking about when we’re talking about the regional fuel tax.

So it is a shame and it is a sad day that we are continuing with the same old, same old fiscal drag tax rates and not taking the opportunity to introduce a progressive tax cut that affects poor people the most. It is disappointing to me that that is being revoked, and that is the fundamental reason—the fundamental reason—why we are opposing this bill. Despite the other good stuff that’s in there—the stuff that was introduced and kicked off by this Government—the fundamental reason is because the tax cut opportunity—a progressive tax cut that affects the people who need it the most—was rejected by this Government.

ASSISTANT SPEAKER (Poto Williams): I understand this is a split call.

Hon JAMES SHAW (Green Party): Thank you, Madam Assistant Speaker. I was just wanting to start off on the snappily titled Taxation (Annual Rates for 2018-19, Modernising Tax Administration, and Remedial Matters) Bill by responding to some of the comments from the previous speaker, the member for the Wairarapa, talking about regressive taxes like petrol taxes, and so on and so forth. I think I must have missed his speech in the House as a backbench MP in a National-led Government when the National Government put up our goods and services tax by 2.5 percent—which is also a regressive tax—and also put up petrol tax. I completely missed his speeches decrying those tax increases at that time—totally missed it. Maybe I wasn’t in the House that day, but as it turns out, it’s good to hear that he’s standing up for the little person. The next time that National is in Government, I look forward to him making absolutely sure that National does not ever again put up petrol taxes or GST, as it did in its last term of office.

But I just wanted to turn my attention to three key aspects of this bill, the first being the KiwiSaver changes, the second being around simplification, and the third being around the 2018-19 tax rates. One of the things that I’m most pleased about in this particular bill are the changes to KiwiSaver. There are two ones that I want to draw attention to. The first is scrapping the rule for people over the age of 60 that says that they have to be in the scheme for five years before they can draw down their money. I think getting rid of that rule and saying that once you hit retirement age you’re able to start drawing that down increases the value of the scheme and increases reasons for people to be in the scheme.

I also think, in particular, that having the additional 6 and 10 percent contribution rates added in makes the scheme far more flexible and far more attractive and, again, adds to that value and increases the chances that people will choose to be in the scheme—in addition to the existing 3, 4, and 8 percent rates. I know that those are recommendations of the Retirement Commissioner at the time, Diane Maxwell, and so I think there’s a solid evidence base for that. So I think we’re continuing to make improvements to KiwiSaver. I do think it has demonstrated its value to New Zealand, and I think that these improvements will do the same thing.

I also just wanted to finish by saying that the rules around simplification—

ASSISTANT SPEAKER (Poto Williams): No, I apologise to the member. We are having some technical issues with the clocks, but I can assure you, you’ve got two minutes and 16 seconds.

Hon JAMES SHAW: Yeah, I didn’t—

ASSISTANT SPEAKER (Poto Williams): We are taking care of it.

Hon JAMES SHAW: Well, in that case, let me just—[Interruption] Ha, ha! I can see that the members opposite are absolutely glued to every word. So around simplification, I think the technology that has been made available to us as a result of the New Zealand IRD’s Business Transformation programme does wonders for New Zealanders’ ability to interact or, in fact, not have to interact with the system in this case—particularly the ability of small and medium sized businesses to have their affairs simplified. For individual taxpayers, there will be 3 million taxpayers whose obligations will be automatically calculated, and any differential between what they’ve paid and what they’re obligated to pay will also be automatically managed. I think that that is fantastic because it removes the need for people to have to fill out a personal tax return in order to get a refund. We think that’ll benefit about 750,000 people, which I think is fantastic.

I think it will ensure that people have a much more pleasant experience, that all of that money that is currently available for refund that’s not getting drawn down will then be drawn down and people will actually get the money that they deserve. So I just kind of stand in admiration of the New Zealand tax system for being able to get to this point now with people that they’re able to interact in that way.

Finally—Madam Assistant Speaker, is that—

ASSISTANT SPEAKER (Poto Williams): Yeah, it’s correct.

Hon JAMES SHAW: OK. I just wanted to finish by saying that the tax rates for the next year remain unchanged and that I think that is a good thing because it means that we can fund the Families Package, it means that we can fund the Provincial Growth Fund, the Green Investment Fund, conservation, health, education, infrastructure, transport—all of the things that the previous Government left unfunded and made wild sorts of things saying that they were going to do all that stuff, but without funding it. This is a fiscally responsible package that ensures that we’ve actually got the revenue that we need to deliver—

ASSISTANT SPEAKER (Poto Williams): I thank the member. I’m sorry; your time has expired.

ANDREW FALLOON (National—Rangitata): Thank you, Madam Assistant Speaker. It’s a pleasure to be taking a call this afternoon in the first reading of the Taxation (Annual Rates for 2018-19, Modernising Tax Administration, and Remedial Matters) Bill. I will be joining my colleagues in voting against the bill this afternoon, and that’s, frankly, despite there being some good parts to the bill.

I just wanted to reflect on some comments made earlier this afternoon by Deborah Russell and also by Michael Wood. Deborah Russell’s contention was that because there’s some good things in the bill, National should vote for it—despite the fact that we want to lower income taxes, not raise them, we should vote for this bill—and then we should try and fix it up in the committee of the whole House. Well, actually, I have to tell Government members that it’s their responsibility to draft legislation. It’s their responsibility to talk to MPs across the House to gain their support and try and get other parties’ support. They didn’t do that with this bill. They didn’t come to us before they brought this bill to the House to try and gain our support. If they’d done that, we would have given them the advice to go off, split it into two bills, bring the KiwiSaver stuff as a separate bill—which we support—and bring the taxation rates as a separate bill, which we would have opposed. They didn’t do that, and for that reason we have to vote against this bill.

I just want to reflect on some of the good things in the bill, though, because, as I said, there are some good things. I’ve said in this House before that KiwiSaver is fantastic. I’m a huge supporter of KiwiSaver. It’s the reason I was able to buy my first house. Since I started work, I’ve put 8 percent of my income into KiwiSaver and that enabled my wife and myself to buy our first home, which I’m very grateful for. What the bill is going to do is expand that out to have more contribution rates, because, at the moment, as it stands, there’s a 3 percent rate, a 4 percent rate, and an 8 percent rate. There’s a lot of advice out there that the gap between the 4 percent rate and the 8 percent rate is too wide. There are a lot of people out there who’d like to be able to contribute a number in between that, but they’ve been required to put in a lesser amount, generally, which is the 4 percent, because they can’t quite afford that 8 percent. So I support that 6 percent rate being brought in.

The second rate that’s being brought in is a 10 percent rate, and I particularly support that because there’s a lot of people out there, particularly who have worked for a long time, who are able to contribute a bit more, and so that’s very positive.

But I do need to now come to the parts of the bill that we don’t support, and that’s in relation to the taxation rates that are contained in the bill. Just a bit of history on this: when we came into Government nine or 10 years ago, the country was deep in recession, the books were pretty shot, we were sliding into deficit, and, as a result, we had to take on a lot of debt to keep paying for core services. That resulted in blowing out debt, and then we were hit by the Canterbury earthquakes, which resulted in even more debt. So we set about growing the economy again, investing in the things that would grow the economy: investing in innovation, investing in education, investing in infrastructure, and that worked. We got growth back on track. We got unemployment down. We created 10,000 jobs every month. In my region of Rangitata, midland South Canterbury, alone, we’ve got unemployment down to 2 percent. That’s incredibly positive, and, frankly, it’s not down to the Government that that happened; it’s down to the people out there in the economy who made that happen: people working hard, people in their businesses, people on their farms, people investing in their businesses, growing the local economies—that’s how the economy succeeded, and they deserve some reward.

So, at the last Budget, in Budget 2017, this Government set out to reward those people. We gave them a tax cut. We gave the average worker a tax cut of $1,060 every year, aimed at the lower income earners—aimed at the lower income earners. This Government, this current Government, all of last year set about arguing for higher taxes—arguing for higher income taxes; arguing, funnily enough, for water taxes, which would have cost my region about $50 million a year. Now, fortunately, they lost that argument, but they have, unfortunately, gone on to legislate for higher taxes. This bill sets those taxation rates in place for the coming year, and we oppose it. Thank you, Madam Assistant Speaker.

ASSISTANT SPEAKER (Poto Williams): I understand this is a split call.

Hon KRIS FAAFOI (Minister of Civil Defence): Madam Assistant Speaker, there have been a range of emotions during this heated debate this afternoon. My colleague Deborah Russell was saddened by the position that the Opposition is taking; Michael Wood, disappointed. But I tend to disagree with them, and I’m sorry to do that to my colleagues but I actually think this is a good day for the Parliament. We are following through with an election promise that we made to not continue the tax cuts that the National Party made in their previous term of Government, to ensure that we had the revenue to invest in things like transport, like housing, like education, like infrastructure, because we knew that the public of New Zealand desperately was in need of support in those areas.

We’ve had members of the Opposition this afternoon decry things that have come about from this coalition Government, like the winter energy payment. But, as Mr McKelvie said, if he’s had plus-65s in his office talking about KiwiSaver, then I challenge them to have those over-65s in their offices and say that they don’t want the winter energy payment—that over-65s don’t feel the need for a bit of support during those winter months to make sure that they can keep their homes safe. So whether they’re in Hastings, whether they’re in Huntly, whether they’re in Martin, whether they’re in Kerikeri, whether they’re in Timaru or Masterton, those members across the hall at the moment, they can go back to their communities and say, “We don’t support the winter energy payment.” to those superannuitants who desperately need help to do a pretty basic thing, which we have at this House here, and that is to keep their houses warm. So that’s the challenge that I put across to other members of the House if they don’t support this piece of legislation.

They don’t support the fact that we went out there and made a promise to the New Zealand public that we wouldn’t continue with National’s tax cuts—which, to put Mr Falloon right, was targeted at high-income earners to make them better off. So, just to fact-check and bring this debate back to reality, those tax cuts, that we’re using to make sure that we’ve got the revenue to invest in all of those things that I’ve suggested, were to make sure that the National Party had a promise to high-income earners at election time to go out there and try and win an election—which, thankfully, they didn’t.

There are some even better things in this piece of legislation, and they are tweaks to KiwiSaver settings. Many members, I have talked to them about the changes to the contribution rates: we’re adding 6 and 10 percent. One thing—which is a small thing which I hope will make a big difference to the decisions that some KiwiSaver policy holders have now—is changing a small thing called a “contributions holiday” to a “saving suspension”. A contributions holiday sounds like something that you want to do, but I think about 42 percent of New Zealanders who are in KiwiSaver at the moment are on a contributions holiday. Mr Scott did put out a challenge to us, or put out the issue, about how do we get more people in KiwiSaver. The subsequent issue, also, is how do we get more people who are currently in KiwiSaver to put money into their accounts and actively manage it, to make sure that when they do turn 65 that, as well as the superannuation, they have enough money to get through retirement.

These are good changes in and around the KiwiSaver settings. I want to give credit to Diane Maxwell and her team at the Commission for Financial Capability, because those changes in this bill pretty much came out of a review that the commission did back in 2016. A point that I would like to make is that those recommendations came in in late 2016, and sat and gathered dust in the final year of the previous Government. So I’m happy that we’ve got this piece of legislation that follows through on some good advice from the commission that will make KiwiSaver settings better for New Zealanders and also follows up on our promise to make sure we’re investing in health, housing, education, transport, and other infrastructure projects that the previous Government wouldn’t have been able to afford if it continued on with its tax cuts for the rich.

ASSISTANT SPEAKER (Poto Williams): Just before I call the honourable member, I just want to remind people—I’m sorry if you’re being distracted by the malfunctioning time clocks. Rest assured that my clock is working perfectly well at the desk here, and I will give members the required time bell.

DAVID SEYMOUR (Leader—ACT): Madam Assistant Speaker, it’s no problem. As you know, I’m one of Parliament’s old-timers, and I can remember giving speeches before we had any such technology in this House, and we got along just fine.

I rise on behalf of the ACT Party in support of this bill. I had planned to oppose it but I listened to the very wise and apposite speech by Michael Wood—not something I say every day, I must tell you—and I decided he had a point. This is not a bad bill. The modernisation that is going on—I wouldn’t quite agree with James Shaw that he stands proudly in awe of the New Zealand tax system; who else could really say that but James Shaw? But it at least starts to bring the IRD’s administration of tax up to where the financial sector, the private sector banking system, was maybe about a decade ago—that things happen efficiently and electronically, so one needn’t pay secondary tax, so one needn’t keep those pesky receipts.

And that was another fine revelation from Michael Wood. Who knew that a Labour MP actually voluntarily gives to charity without it being prised out of their cold, dead hands by the IRD? It is a good thing that we’ll be able to pay less tax when we give to charity without having to keep all those pesky receipts that accumulate throughout the year. So these are positive things and reason to vote this bill through so that my fellow Finance and Expenditure Committee members and I can scrutinise the bill, have a look at it, and see where it might be improved.

I follow on from my friend and neighbour the Hon Paul Goldsmith in pointing out one area where this bill could be improved—that ACT’s future support of this bill will depend upon being changed—and that is clause 3 of this bill, the clause that sets out the annual tax rates; unchanged, again. Let’s give a little bit of history. These tax rates and tax brackets have not been changed for almost a decade now, since 2010. Once again, exactly the same tax rates, and the working people of New Zealand will find that, through no fault of their own, inflation has pushed their incomes into higher tax brackets. They can’t purchase more, but the same purchasing power that they used to earn 10 years ago is now taxed at a higher rate, thanks to fiscal drift, or fiscal creep, and they find themselves increasingly in the top tax bracket. Nearly half of New Zealanders pushed into the top tax bracket—over $70,000 paying 33 cents in the dollar—because nobody, including the previous National-led Government despite the protestations of its principal partner the ACT Party, has bothered to adjust the tax bracket for 10 long years.

Actually, the ACT Party has a solution to this. We heard from members opposite that it’s great that we are taxing, because we can fund a whole lot of things—some of which are somewhat dubious from a public policy perspective, but, nevertheless, many things can be funded with these tax rates. Actually, we could fund all of the things that the Government wants to spend—and, in some cases, waste—money on and significant tax cuts. ACT showed this last year, that we could have a beautiful three-rate tax system of 10 cents in the dollar—that’s down from 10.5 cents—up to $14,000, 15 cents in the dollar all the way up to $48,000, and 25 cents in the dollar after that. What would be the fiscal impact of that change? It would fit easily within the $20 billion - odd of surpluses that these tax rates will give the Government over the next four years. We could have tax rates where nobody would pay more than a quarter of their income in tax, simply by giving back the Government surplus to the people who earned it.

So just think about it, fellows on the Government benches. I realise most of the members present are on the back benches and don’t have a huge amount of influence over these things but, nevertheless, maybe speak to Grant Robertson, the Minister of Finance, and ask him—

Hon David Parker: More influence than you.

DAVID SEYMOUR: And here’s David Parker. He can affect things. David Parker—he’s got some influence. Think about it, David Parker. Let’s try having a top tax rate of 25 cents, which can be afforded within the surpluses put forward by Treasury, under the tax rates in this bill, and if the Government is prepared to give real tax cuts, real tax relief, let the people who earned the money keep it—

ASSISTANT SPEAKER (Poto Williams): I apologise to the member. Your time has expired. Thank you.

LAWRENCE YULE (National—Tukituki): The mere fact that this bill is called the Taxation (Annual Rates for 2018-19, Modernising Tax Administration, and Remedial Matters) Bill in itself highlights the point that, actually, there should be two bills. There should be two bills here, because part of this bill is fantastic, and part of it we, philosophically, on this side of the House, object to, and that is our right to do so. The good parts of this bill are changes that help taxpayers. They are changes that reduce compliance costs and the amount of time taken to complete taxation returns; they automate tax refunds and—something that I find particularly pleasing—they cut out third parties which at the moment have set up business models based simply on what IRD will soon be able to do. So agents that use technology to give you a tax refund but actually take fees for doing so—many of those will be taken out of business in the simplest form.

I also acknowledge the changes to the donations legislation. This is modernising the environment—no different to what members of this House actually do with expense claims. They’re lodged, photographed, and sent in, and they’re all done appropriately. I also think the tailored taxation codes are going to make a fundamental difference to how people deal with taxation when they have multiple income streams, or when their taxation position changes.

There is also an ability for proactive changing of the tax codes to represent people’s particular circumstances, and, importantly, the Retirement Commissioner’s views in 2000 and 2016 have been brought into this by raising the possible contribution rates and the fact that 65-year-old people can enter KiwiSaver. I also agree with all members of the House that the savings suspension in terms of its minimal time—reduced from five years to one—and its title is appropriate.

But I do really want to go on to what Deborah Russell said right at the beginning of her contribution to this House: that this was a shame. We are vexed by her objection, because that very Government, with this very Prime Minister we have now, promised no new taxes—no new taxes—but on 1 July, what did we have? Regional fuel tax implemented in Auckland. So of course we object on this side of the House, because what you said you were going to do, you’re not actually doing.

ASSISTANT SPEAKER (Poto Williams): Not me.

LAWRENCE YULE: Sorry. What the other side of the House, or the Government, said it was going to do, it is not actually doing. It also removed legitimate tax cuts that were made by this side of the House when they were in power. They went through the Parliament, they were legitimised, and then from 1 July they were meant to come in. And despite what the honourable member Kris Faafoi said, most of our tax cuts were actually aimed at lower-income people. It wasn’t all for upper-income people; it was actually specifically targeted.

I also want to comment on what some of the expenses are and the choices that this current Government have made: $2.8 billion to students, not one extra student enrolled; $3 billion to the Shane Jones fund, and it’s going to be really difficult to spend that level of money; and a billion dollars to foreign affairs.

But I particularly want to comment because this is about tax rules and tax amounts for the coming year. From 1 July, Sunday, people in Auckland are paying 11.5 cents a litre more for their fuel. This Government has also signalled they will pay another 12 cents a litre for fuel over the next three years, and members on the other side—members of the current Government—said, “We needed to do all that because we’ve got to fund everything.” If that’s the case, why did you strip $5 billion—

ASSISTANT SPEAKER (Poto Williams): Order!

LAWRENCE YULE: Why did the Government—

ASSISTANT SPEAKER (Poto Williams): Thank you.

LAWRENCE YULE: —strip $5 billion out of the State highway network across New Zealand? Places not my own are going to pay more and get nothing. It’s outrageous, and you wonder why we on this side oppose this bill—because it’s all being put together in things we feel strongly about.

We have a philosophy in the National Party that people are better able to spend their money than any Government. That’s why we brought in tax cuts. And, actually, those tax cuts were cancelled. I also remind members of the Government benches, as you look at this new piece of legislation, remember, you talk about tax promises, or you talk about election—sorry, I apologise Madam Assistant Chair.

ASSISTANT SPEAKER (Poto Williams): Thank you.

LAWRENCE YULE: The Government talks about election promises, but, actually, the Government forgot about one fundamental promise it made in that election campaign: there would be no new taxes. And from 1 July, that fundamental promise has been breached and broken, and that is why this side of the House is so upset at this piece of legislation. Thank you, Madam Assistant Speaker.

WILLOW-JEAN PRIME (Labour): Thank you for the opportunity to be the final speaker in this debate on the first reading of the Taxation (Annual Rates for 2018-19, Modernising Tax Administration, and Remedial Matters) Bill. I am a member of the Finance and Expenditure Committee, and I look forward, as a member of that committee, to receiving this bill shortly.

I wanted to talk about a couple of things, because a lot has been covered already. We know that the intent of this is to modernise our tax system and that earlier in the year we passed the Taxation (Annual Rates for 2017-18, Employment and Investment Income, and Remedial Matters) Act 2018, and this bill is in addition to that. I wanted to focus on two parts in particular in here, where we talk about remedial matters that need to be addressed to take into consideration and incorporate the changes we’re making in the Families Package, and in particular with the Best Start payment. I’m really proud that on 1 July the Best Start payment has now kicked in for those families who have babies born after 1 July.

Now, there is a new clause in this bill which will deal with that new payment that we’ve got, and ensure that the policy which we intended, which was that from the time that paid parental leave expires, the Best Start payment will kick in—and that’s another thing that I’m very proud of, that paid parental leave has increased now to 22 weeks, as well. So those remedial change matters are dealt with at clauses 259 through to about 264.

The other part I want to talk about is the other end of life, where we are focusing on KiwiSaver, and that’s saving for our retirement. I’m very proud of the changes that we are incorporating into this bill to enhance the KiwiSaver scheme that we have, and those come as a result of the review that was done by the Retirement Commissioner, and that most recent review in 2016. Some of those changes have been summarised, but we’re introducing the additional KiwiSaver employee contribution rates of 6 and 10 percent; reducing the minimum contributions holiday period from five years to one year—and, actually, as a member earlier said, not referring to it as a contributions holiday but more a saving suspension; allowing over-65-year-olds to opt in to KiwiSaver, acknowledging that many of our over-65s are in fact still working as well; and removing the five-year lock-in period, which currently affects those who join KiwiSaver between the ages of 60 and 65.

I only intend to take a short call on this draft legislation. I commend this bill to the House, and I look forward to looking at it further at our select committee.

A party vote was called for on the question, That the Taxation (Annual Rates for 2018-19, Modernising Tax Administration, and Remedial Matters) Bill be now read a first time.

Ayes 63

New Zealand Labour 46; New Zealand First 9; Green Party 8.

Noes 56

New Zealand National 56.

Motion agreed to.

Bill read a first time.

Bill referred to the Finance and Expenditure Committee.

Bills

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

Second Reading

Hon DAVID PARKER (Minister for the Environment): I move, That the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill be now read a second time.

The bill corrects an error in legislation that governs the management of activities in our offshore environment and ensures that a cost recovery regime that charges the applicant can fairly operate. A new board of inquiry process for dealing with some marine consent applications was added to the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act, which I will shorten to the EEZ Act in future. This was added in 2007 through the Resource Legislation Amendment Act, and an additional provision is needed to allow recovery from an applicant of the board of inquiry costs that are applied under that Act.

Now, members who were in the House during the last term will remember that there was quite a controversy around that piece of legislation. It had a shambolic passage through the House. It lay around at select committee for about a year because the Government couldn’t put together the numbers for the bill. The chair of the committee was Scott Simpson, and he was having to turn up time and again—it wasn’t his fault; it actually wasn’t his fault, but he had to turn up time and again because his Minister didn’t have the numbers for the bill, because it was opposed not just by the Labour Party but also by New Zealand First, by the Green Party, and by two of their then coalition partners, United Future and the ACT Party. They couldn’t even get support from the Māori Party for it until they did a trade on some other legislation.

Now, throughout this, the bill was lampooned as being overly complex and ill-considered, and this is one of many examples of where it was flawed. So the effect of it was that taxpayers were left footing the bill in respect of applications for consents within the EEZ area that went to a board of inquiry, and this bill fixes that, relieves the long-suffering taxpayer of having to do that in the future.

The select committee’s now heard this, and can I thank the Environment Committee for doing that and for the scrutiny that they gave it, at the end of which the committee has unanimously recommended that the bill should be passed, with one minor amendment which corrects a cross-reference. Can I also acknowledge the New Zealand Law Society, who wrote to the Environment Committee and to me about another area that they’ve suggested clarification for. They’ve suggested that it would be easier to follow the legislation if there was another provision put into the Act by this amendment bill to make it clear that existing cost recovery provisions in the EEZ Act will continue to apply, and we’re intending to do that at the committee of the whole House stage.

There are other issues that are more substantial, for me, in respect of the EEZ legislation that are not in this legislation. I find it hard to understand why we have a different legal test and a different set of rules applying to sea areas out to the edge of the territorial sea compared with the rules that apply within the EEZ. It’s unnecessarily complex to have two different sets of legal principles and two different processes that apply inside and outside that boundary of the territorial sea. It makes no sense, and, indeed, that’s been made clear in some applications that have had to make applications at the same time for consideration under the Resource Management Act out to the territorial sea boundary and a separate application for the same activity in respect of the portion of the sea outside the territorial sea to the EEZ. We can’t fix that in this bill, but it does point to more work needed on this in the future.

The bill also sets out criteria: the Minister must have regard to, when recovering costs from an applicant—those who have sat on the Regulations Review Committee in recent years will have seen complaints from applicants where some of the board of inquiry costs have run to millions of dollars and they haven’t felt like the board of inquiry has had appropriate controls on the way in which they incur costs which are eventually recovered from the applicant.

I don’t think any more needs to be said, other than that. After this amendment bill passes through subsequent stages, applicants will be subject to the cost recovery provisions they ought to have been subject to. I make the point that we’re not applying this retrospectively, and anyone who’s filed an application before this law comes into effect, effectively, does so at the cost of the taxpayer. That’s appropriate, given that we ought not to be imposing these things retrospectively. I commend the bill to the House.

Hon SCOTT SIMPSON (National—Coromandel): Thank you, Madam Assistant Speaker. I just want to acknowledge the—I thought—very thoughtful contribution of the Minister for the Environment, in whose name this bill appears before the House. It’s a pleasure to rise and take a brief call in the second reading of this Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill, which the Minister abbreviates just to the EEZ bill, and I think that’s probably a right thing to do.

This is a technical tidy-up. The original piece of legislation, as the Minister said in his comments, related to work that was done in the previous Parliament around the Resource Legislation Amendment Act. That was a very significant piece of legislation. It ran to over 700 separate clauses and some 250 pages in the statute book. So it was a pretty grunty piece of legislation by any measure, and it had a vast array of moving parts in it. There were lots of pieces of the Resource Management Act (RMA) that were amended and changed and modified, and it also made amendments to the Conservation Act, the Reserves Act, and the Public Works Act. So there were many moving parts to this legislation.

I don’t blame at all the hard-working and diligent professionals at the Parliamentary Counsel Office (PCO) who actually have to draft all this stuff, get it finely tuned, interpret and understand the directions that come from both the Minister driving the legislation—and that comes through a process of Cabinet approval and Cabinet minutes and Cabinet notes—but then, also, the directions and interventions that are made at select committee, and the various submissions that are made. It’s a very big job.

I think the other thing to remember is that when the good folk at the Parliamentary Counsel Office are drafting legislation of this sort, it’s usually not just one piece of legislation that they have on the go at one time. Most of the time they’ve got multiple pieces of legislation, and I think it takes a very special kind of educated brain to actually do that work and do it as thoroughly as they do. Now, notwithstanding that praise for the good work that the PCO officials do, in this instance a mistake was made and, through a human drafting error, a direction that was made by Cabinet, approved by Cabinet, and that had the intent that is being achieved by this amendment bill today was simply omitted. Now, that’s a kind of human mistake that can be made from time to time, and I don’t want to apportion any blame for it, but a mistake, none the less, was made, and so Parliament needs to just address that issue, and that’s what we’re doing.

I think a very good question that arose during a truncated select committee process was why we needed to have a special piece of amending legislation to achieve this outcome. Parliament will very shortly consider what’s known as an annual Statutes Amendment Bill, and that’s usually the place where errors of this sort, that occur from time to time, are fixed and are resolved. A special piece of legislation is usually not required, in its own right, to be made to take up the time of the Parliament in sitting time, or indeed the time of a select committee. But, in this case, the Government decided to do that.

So at first reading the Opposition acknowledged that it was an honest mistake, an error in drafting, and we were prepared to simply move the changes through all stages at first reading. That invitation was declined by the Government, and we then moved to a select committee process. That process was truncated, shortened, and, at select committee, there was agreement amongst select committee members—it was a unanimous decision—that we wouldn’t take submissions, but that we would, actually, invite the New Zealand Law Society to give us the benefit of their views and opinions on the changes that were proposed.

Then, before we had had an opportunity to receive that advice and submission from the Law Society, the Environment Committee, in its collective wisdom, decided to report back to the House, and the committee did that in terms of where we thought it was. We had received advice from PCO draftspeople that told us that what we sought to achieve was being done by the amendments that they had proposed. Then, subsequent to the report coming back to the House, the select committee received from the Law Society a very useful and helpful submission that actually went beyond what we had expected, I think, from them in the first place. Then, as a result of that, having reported back to the House, we found ourselves as a select committee having to say, “Well, actually, the Law Society makes some pretty jolly good points. Maybe we should reconsider a couple of those things.”

So we find ourselves now with an amended amendment, slightly—and, again, not the fault of anyone in particular. I think the intention and good will of the select committee was well-made. I don’t think there was any malicious intent at all; I think this is just one of those things where it’s been a bit of a comedy of one thing on top of another.

So the Law Society made a submission to us, and they suggested three things: firstly, that the proposed new board of inquiry cost recovery provision actually differed from what was in the RMA, and that was, of course, what we had designed this amendment to do. We wanted it, actually, to essentially be a cut and paste and to apply a board of inquiry cost recovery model that was replicated in other statutes and other parts of the legislation. We found that that actually hadn’t occurred, and it was the Law Society that drew that to our attention. The Law Society considered that there was a need for a greater alignment, and that that would be appropriate in terms of fulfilling requirements of the legislation. So that was one area that they brought to our attention.

The two other areas that they brought to our attention—the first related to cost recovery criteria. Although this piece of legislation is designed to ensure that people who are making applications for marine consents in the EEZ, essentially for a private gain, should pay. The logic of that, I think, is fair and reasonable, but the Law Society pointed out that that might not always be 100 percent the case—that there may be a public good from a resource consent, a marine consent, in the EEZ, and that the bill should actually accommodate that in some meaningful way. They used an example of, perhaps, a private enterprise that was seeking to lay submarine pipelines, for instance. Now, that’s essentially a commercial enterprise, but the net result of it provides a degree of public good in terms of public service and betterment of public usage from the installation of such a pipeline. Now, what the Law Society suggested was that that should be somehow recognised in the bill. The Minister’s indicated that he wants to address that at the committee of the whole House stage, and I think that’s a sensible thing.

The third point that the Law Society made was in relation to an objection process. They said that at present, and unlike the RMA, there’s no formal objection process enabled in the provisions of this bill, and the Law Society, I think, made a good argument on the basis of reasonableness that an objection process should be included. It’s my hope that the Minister will consider including that suggestion from the Law Society also, by way of Supplementary Order Paper, at the committee of the whole House stage.

So, on this side of the House, we support this bill. It’s a minor technical tidy-up, but it’s been a little bit of an adventure and a bit of a learning curve for us all, I suspect. I commend it to the House.

Hon JENNY SALESA (Minister for Building and Construction): Thank you so much, Madam Assistant Speaker, for this opportunity to speak on the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill. This bill is, essentially, about supporting good governance of our marine environment; however, it is also about fairness—especially, fairness to our taxpayers in carrying that task out.

Our marine environment has significant value to Aotearoa New Zealand. It encompasses social, spiritual, and cultural dimensions. Last year, we went through this particular process of passing this legislation and, as you heard the Minister for Environment, the Hon David Parker, address this House just earlier on, this was a process that was not only long but it was a process that all of us on this side of the House this year were actually against. One of the reasons why our side of the House was against this particular bill at the time was the fact that we wanted the bill to be fairer on our taxpayers.

As you would have heard described—especially from the other side of the House as well—the principal Act, which the bill actually amended last year, unfortunately did not take into account the fact that there was an oversight in cost recovery, which the member opposite, Scott Simpson, has just spoken about. The Resource Management Act actually allows for cost recovery to happen; however, a mistake was made last year. That was not included. That is one of the reasons why we are passing this legislation, under urgency, as fast as we can. When you look at some of the examples from the select committee, one of the examples that was given was the fact that, in terms of the boards of inquiry, when they’re dealing with applications for the marine environment—one of the examples that was given to the select committee was that it cost over $1 million for a board of inquiry. Now, when the benefit that is actually proposed is a private benefit, when that benefit is not met by the private applicants but instead, as it is right now, is actually met by the public purse or by taxpayers overall, that is not fair, and that is one of the reasons why we are discussing this particular legislation now—fixing it.

However, can I just make a point as well that fixing legislation like this when mistakes have been done in the past is time-consuming and it does take all of us in the House to ensure that the mistakes are fixed. My hope is, as we move forward, that this particular bill that we’re passing today actually fixes a lot of the mistakes that were made in the past. I strongly commend this bill to the House. Thank you.

SARAH DOWIE (National—Invercargill): Thank you, Madam Assistant Speaker, for this opportunity to rise in support of the second reading of this Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill. Firstly, I want to take the time to congratulate my colleague the Hon Scott Simpson on his précis of the process and how this bill came into being: the fact that, in the last Parliament, we had the resource management reform. It was a complex set of reforms. As you heard from Mr Simpson, there were over 700 clauses amended, over 250 pages of material, of various moving parts, and it was very complex.

One thing that I think was unfairly lobbed towards this side by the Hon David Parker was that this was our error. As anyone can see, when you have a complex reform bill, it’s only natural—we hope it doesn’t happen, but it can happen—that certain things get overlooked when time pressures are on the table. I support the Parliamentary Counsel Office, but it was a drafting error and it has resulted in this very minor and technical bill by way of a tidy-up. I’ll certainly say to the Government at the moment that that criticism is certainly unfounded and unfair, and I would simply draw their attention to their 100-day plan, where they extended paid parental leave, which, certainly, I was supportive of, but when they did so, and that was a relatively minor bill, they overlooked extending the keeping-in-touch hours at the same time, which resulted in me putting forward a Supplementary Order Paper and the Government adopting it. So that is simply a highlight of the fact that, when we are drafting legislation—when we are doing it and it is complex or when we are doing it in a hurry—even the best of us can overlook some minor elements, and we need to go back and tidy up.

So here we are. We are here with a bill that is tidying up a technicality, and it is minor. There is no substantive change here; it is a policy decision that was signed off by the previous Cabinet, and we are making good on that promise in that it is only fair that when a private individual is looking to seek a private benefit in the marine space, that when they apply for that consent and through a board of inquiry process, they pay for the cost incurred of that assessment. This is what that bill does. It also enables the applicant to ask the Minister, through the Environmental Protection Authority, for an estimate of those costs. Again, a fair mechanism to have and certainly not a policy change. And it also allows the Minister, in considering that assessment and the consent—any offerings from the applicant that would reduce the costs as part of that application process. So the Minister can assess that and bring that into the mix when they are providing the estimate and their assessment of the reasonable costs for that application process.

So, as you’ll see, it’s a very minor and technical bill, which has resulted in this truncated process that was before this House and then before the Environment Committee. I am a little bit amused that this process wasn’t truncated further. We had debate in this House at the first reading that the first, second, and third readings should be taken as one because it was so minor and technical. Regardless, it was referred to the Environment Committee, where it was again unanimously decided that no submissions would be taken. And, as the Hon Scott Simpson pointed out, we did seek further consideration from the Law Society, which resulted in a very good submission to us that detailed three points. Two of those points we did decide were verging outside of the scope of the bill and verging into a new policy arena, but certainly the first, with respect to drafting and making the bill clearer with regard to cost recovery, was taken on board.

So, anyway, we are here now. We have our bill in front of us and it is supported by this side of the House. I’m certainly not going to take any more time in discussing this bill, given that my colleague gave such an excellent précis of where we are to date, and we support this bill in its second reading.

JENNY MARCROFT (NZ First): Thank you, Madam Assistant Speaker. It’s a privilege to stand and speak on behalf of New Zealand First on this, the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill. I too will take a relatively short call on this as we progress this bill through the House.

I’d first like to make note of Minister David Parker and thank the Minister for bringing this bill to the House; noting that he mentioned that the original Act—this is why this amendment needs to happen—had a bit of a shambolic passage through the House. But he also noted, to his credit, that the former chair of the select committee—actually, it was not his fault; so it was good to hear that as well. It was an overly complex Act—the original one—and more work definitely needs to be done on that, and we will be seeing that work come through the House at some later stage.

I’d also like to acknowledge my fellow colleague from the Environment Committee, the Hon Scott Simpson, for his contribution on this bill today. As a new member to the House who was not here in the previous Parliament, I appreciate your contribution, as you saw the original bill coming through the House; so thank you for that. In fact, it really is a pleasure to work in the Environment Committee on pieces of legislation like this where we can work together effectively and collaboratively. That’s something that I’m really enjoying—being a part of that team.

Just noting that this bill, as has been mentioned already by all the previous speakers, is a sensible, housekeeping piece of legislation. It has a very narrow scope and it corrects an error. So there is no point delaying its passage through the House. It will amend the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act 2012, and the Minister for the Environment will be able to recover the costs of a board of inquiry when an applicant applies for a notifiable marine consent. Now, those costs of the board of inquiry are substantial. They can go into the hundreds of thousands of dollars, and that’s why it is important that we tidy up this piece of legislation so that the taxpayer, the Crown, doesn’t have to foot the board of inquiry costs.

So as we looked through this piece of legislation when it came into the select committee, we noted that we did not seek to have submissions on it, but we did hear from the New Zealand Law Society. Their contribution to this piece of legislation, although it was asked to be a shortened, truncated process, actually ended up being quite important, and I note that they pointed out one amendment to this amendment, and that will correct a cross-referencing error. It is a very tiny, very minor cross-referencing error, but wouldn’t it be a tragedy to have an amendment and then have to find another amendment if we didn’t get this piece of legislation through the House with this correction? So the cross-referencing error comes through in clause 4: “In section 14, [replacing] ‘Parts 3 and 4’ ”, and then we delete Part 3, so it will just read “with … 3A and 4’.” So it’s a very tiny amendment there that the Law Society pointed out; so it was a very fortunate thing that we did have that period of time where they could make a submission.

This amendment bill will enable the Minister for the Environment to recover the costs of the board of inquiry, but it will also enable the Minister to delegate power to the Environmental Protection Authority to recover the real and actual costs on his behalf, and that’s a very important part of the process.

I won’t delay any further my contribution to the House, other than to note that the Government will be introducing a range of other short-term changes to the Resource Management Act over the next period of the year, and a more comprehensive, longer-term view of the resource management system will be considered next year. In fact, there has been one submission which will have a board of inquiry. The first application, in fact, to the exclusive economic zone board of inquiry process has recently been lodged; so that is already under way, but there will be no further once this piece of legislation passes through the House.

So we cannot penalise people who, in fact, have played by these rules, but this is a cost which will go into hundreds of thousands of dollars, and it’s really great that we’ll be able to get this through the House over the course of the next few days so that there will be no further cost burden to the taxpayer. The environment Minister, as I’ve mentioned, will be introducing more of these amendments as the Government proceeds, logically, to tidy up other pieces of legislation that need some technical fix-ups.

In conclusion, New Zealand First supports the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill as being a very sensible piece of housekeeping legislation. It’s the first step in correcting a series of legislative mishaps and pointing towards more important work on the Resource Management Act, and so I commend this bill to the House.

ERICA STANFORD (National—East Coast Bays): Thank you, Mr Assistant Speaker. I’m pleased to take a call on the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill at the second reading. I really am not going to take much time on this speech; a lot of what has needed to have been said has been already said by my learned colleagues, especially Mr Scott Simpson and Sarah Dowie.

In the end, this is a very minor technical amendment to fix up what is a drafting error in the original legislation. The intent of this bill is to give effect to existing policy settings and decisions, and it was always intended that this bill provide for cost recovery of boards of inquiry in a manner consistent with boards of inquiry under the Resource Management Act. As sometimes happens in large complex bills such as this one, errors can be made, and, indeed, it was made in this bill. The upshot is that at present the costs of a board of inquiry fall on the Crown, even when the applicant is applying for a marine consent for private benefit. Of course the intent was that in this instance the costs of a board of inquiry be carried by the applicant. So this amendment bill is to amend the drafting error; it correctly puts the costs back on the applicant.

As expected, there weren’t any public submissions on this bill, as it really is just a straightforward fix-up bill. The select committee process was very short in that case, and it was led by our fine chair, Deborah Russell, in her usual extremely capable manner. The only thing that was really worth noting was the advice by the New Zealand Law Society, who made a number of recommendations. It was an interesting process to be part of as a new MP, because I would’ve expected that we had this advice in before we reported. Unfortunately, we didn’t. The Law Society did make a number of really interesting and quite important recommendations, one of which I know is going to be taken up as a Supplementary Order Paper by the Government but I would encourage them to look at some of the other recommendations made by the Law Society. They were good recommendations that I think we need to look at quite seriously, perhaps in the committee of the whole House stage.

So that’s really all that needs to be said about what is very much a small technical amendment to fix up what is a mistake that can often be made in such large bills. Thank you, Mr Assistant Speaker; I commend this bill to the House.

Hon EUGENIE SAGE (Minister of Conservation): Tēnā koe, Mr Assistant Speaker. Thank you. Similarly, I will not be taking very much time to speak on this bill, the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill. It’s a very slender bill: three pages with an explanatory note.

It’s all very well to say that it was always intended that this happen, but the former Opposition opposed the Resource Legislation Amendment Bill quite strongly for being quite shambolic in the way it went through select committee and in the House under the former environment Minister, the Hon Dr Nick Smith, because of the scale of the changes and the fact that they weren’t integrated. So this is yet another example of the Government having to fix up some problems created by the former administration.

So of course it makes sense that the cost of applications for marine consents, which are publicly notified under the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act (EEZ), should be borne by the applicant, because unless this bill goes through, those costs are borne by the Crown. When applicants are seeking a private benefit—

Hon Scott Simpson: A very sanctimonious hill the Minister’s climbing.

Hon EUGENIE SAGE: —for the use of public space, it’s appropriate that they pay for those costs. Now, Mr Simpson’s saying it’s a sanctimonious bill—

Hon Scott Simpson: No, it’s a sanctimonious hill that the Minister’s climbing.

Hon EUGENIE SAGE: The issue is that we get this fix to the legislation. Mr Simpson obviously isn’t interested in listening at all with the number of his injections.

So this is moving to ensuring that under the EEZ Act, we have the same regime as under the Resource Management Act: that the costs of the boards of inquiry are recovered from the applicant. So it is a very short and simple bill. The sooner it goes through the better, because already there is one application which is before the Environmental Protection Authority, and the Crown will have to bear some of the costs of that. So it’s a good fix and it should proceed.

IAN McKELVIE (National—Rangitīkei): Thank you, Mr Assistant Speaker. It’s a pleasure for me to take a short call on the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill—one which I didn’t sit on the select committee for, but it does affect an area that I have a specific interest in.

I suppose I’m quite relieved, really, that I spend my life looking forward not backwards. I don’t think there’s much point in looking back, but I did want to briefly outline a couple of issues that have been raised in the course of the speeches, and one of them was by the Hon David Parker when he talked about the challenges that he has with the rules being slightly different whether we’re inside or outside the New Zealand exclusive economic zone, or in New Zealand territorial waters. I thought that made a bit of sense, because, if you think about the area of interest that I’ve got, particularly around aquaculture and the things that happen with the fishing industry, there’s a high likelihood that you could, in due course, have consents being applied for or use applications being made for factors that are certainly affected by both of those areas of interest. I think there’s a lot of sense in what the Hon David Parker said about trying to rationalise that challenge that we have with our current legislation.

The other thing, of course, that this particular clause does, and the bill does, is have a significant impact on the way we consent aquaculture particularly, and how we then recover those costs. I think the encouraging thing for me in this bill was the fact that the authorities or the Government have to give an accurate—or the consenting authority, I guess—view of what those costs might be. Of course, that’s quite challenging, as some of these applications are very expensive. But it will be very reassuring for those applicants to know that they have the opportunity to at least get some sort of an estimate of the costs and, I guess, hold that consenting authority to account later on if those costs are not necessarily adhered to.

The other thing I think that’s interesting in the course of this bill, and it doesn’t apply to this part of the bill, is that if you look back at history, it shows how important it is to put complicated pieces of legislation—and even simpler pieces of legislation—through the select committee process, because it’s so easy for mistakes to be made, and we’ve seen a number of times in my time in this place where we’ve had to bring legislation back to the House. Only the other day we were talking about local government legislation where we have challenges with legislation for setting rates and things like that where they’re not set properly and have to come through the House to be reviewed. So I think that this will probably just epitomise the importance of putting all legislation through the select committee process. I don’t think there’s an excuse for not doing that, and even when we do put it through the select committee process, it’s still possible—and no matter how diligent and how long it’s there for—for mistakes to be made in the course of implementing that legislation.

I won’t waste the time of the House any further. I think it’s important that we do have these sorts of pieces of legislation and we have them in the order they should be—that they are correct. I also think that it’s important that we look to the future around this type of legislation and think as to how we might review it in the future, because there’s no question it will need reviewing in the future. I don’t know that we have our environmental legislation in the right space at all in New Zealand, and it will be interesting to see where future Governments get to with that. Thank you, Mr Assistant Speaker.

ASSISTANT SPEAKER (Adrian Rurawhe): This is a split call. Five minutes—Dr Deborah Russell.

Dr DEBORAH RUSSELL (Labour—New Lynn): Mr Assistant Speaker, we’re talking about the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill, but, to be honest, I think we should really call it the “Well, We Could Have Done That Better Bill”, because, actually, it’s kind of characterised it all along. To be honest, it did start from a drafting mistake in the big set of legislation that went through the Resource Management Act in the previous Parliament, and drafting errors do occur in complex legislation—there’s no doubt about it—but, well, we could have done that better.

Then it came back into the House so that we could fix it, and as part of that process we had a very truncated select committee process. Now, in part that was driven by the report-back dates, in part by Parliament’s sitting schedule, and because of that very truncated process as a committee, led by me, we elected not to hear submissions on the bill. Frankly, looking back, I’m going, “Urgh! Well, we could have done that better.” We asked for some advice from the Law Society, but we had to report back to the House before it came in and, again, if perhaps if we’d waited—well, we could have done that better.

I think the fact is that there are a lot of lessons to be learnt in this. It is only a minor matter but we could have done it better. And although I’m saying “we”, at some stage of this I’m going to say, “I could have done this better in terms of the leadership of the select committee.” A week or two ago, we heard Speaker Trevor Mallard in this House talking about how when he got advice from officials it was advice, but if he signed his name on it, then it was his decision. I signed my name to that in the select committee so, actually, I could have done that better.

But so be it. We’ve got it in front of the House now, back in the House. We think we’re going to get it right this time. We’re certainly working on it hard—all of us together—to get it right. And here I’d like to especially acknowledge the words that the Hon Scott Simpson spoke earlier this evening about, really, the hard way we worked together to try to get it right even though we could have got it better. I think it augurs well for the process that we’ll be going through talking about climate change legislation later this year. As a committee we do work well together, we try to get it right, and we’re hoping that we won’t be coming back on that one saying we could have got it better. I’d also like to acknowledge the deputy chair, Mr Todd Muller, who is great in terms of advice and actually helping that committee to work effectively.

So we could have got that better; could have done it better. What we’re trying to do now is get it right. We’re doing our best on that and we want to get it right because it is about our environment, which is critical to us. We’re doing the best we can.

ASSISTANT SPEAKER (Adrian Rurawhe): A five-minute call—I call Maureen Pugh.

MAUREEN PUGH (National): Thank you, Mr Assistant Speaker. I stand to speak also to the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill in its second reading, today. And this really is an odd bill to be debating in the House here today, and I consider it a waste of the House’s time, to be perfectly frank. It was a waste of time of the select committee, it was a waste of time of the advisers, of the parliamentary counsel, and of the committee’s secretariat that supported the select committee, to be making such a non-controversial amendment. All parties here agreed to the change. However, that side of the House insisted that it be put through this process, consuming valuable staff and committee time and also this House’s time.

It’s such a minor amendment to be making and it could have been easily dealt with as part of a statutes amendment bill. And as was suggested by my very astute colleague here beside me—the Hon Scott Simpson, in his first reading speech even sought leave of the House that this bill proceed forthwith through all remaining stages without debate and on one vote. But that side of the House wouldn’t go there, and we may wonder why. It certainly wasn’t in the interests of expediency or efficiency and it certainly wasn’t in the interests of openness and transparency that we hear so much about but we are yet to witness in practice. And it wasn’t in the interests of any potential submitters, because the process was so truncated that no submissions were called for.

But the irony of it is that prior to the bill being introduced, there were seven organisations that were contacted and they were invited to make comment. These seven representatives were from the petroleum and seabed mining industries, and five of them came back and said that they were also in support of the minor changes in this bill. But the irony is that they were invited to make comment on such a minor amendment to this bill, which is absolutely laughable when you stack it up against the consultation on something else of far more consequence and importance to that sector: their future and the future of the oil and gas industry here in New Zealand—a decision that has no justifiable basis. It’s certainly not rational, it’s certainly not an environmental benefit, it certainly has no economic sense, and the most bizarre thing is it actually has no benefit in terms of improving global emissions.

So we need to ask ourselves: is this a stalling tactic in getting this bill across the line? I’ve noticed over several weeks that we are dealing with such minor legislation here, or we are dealing with legislation left over from the former National-led Government. This goes to demonstrate yet again the gaping hole that there is in the work coming before this House and what is actually stacked up on the Order Paper.

This bill is simply putting right a drafting error in the original bill. We’ve heard all that today. Clause 5 inserts a new section 52A entitled “Cost recovery for boards of inquiry”, and that simply means that there may be recoverable costs from an applicant for the actual and reasonable expenses incurred in relation to a board of inquiry. These actual and reasonable costs are already recoverable under the Environmental Protection Authority in relation to their receiving, processing, and deciding on applications for marine consents, and so this bill simply brings it into consistency. It now aligns with the Environmental Protection Authority and the Resource Management Act of 1991, and I commend it to the House. Thank you.

ANGIE WARREN-CLARK (Labour): Thank you, Mr Assistant Speaker. I rise, and—let’s face it—this speech is going to be probably about as long as the name of this bill. It’s a pleasure to take a short call on this second reading of the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill (EEZ), which amends the principal Act of the same name in 2012, which was in turn amended by the Resource Legislation Amendment Act in 2017 to include, basically, a board of inquiry for marine consents. We all have heard that there has been an error that was left off and there’s been no cost recovery. So, quite simply, this EEZ amendment bill adopts a user-pays system.

Now, it’s been a real pleasure to listen across the House. We’ve all accepted, except for the member Maureen Pugh, that there has been error across both sides, and I’d actually like to acknowledge Dr—

Tim van de Molen: I raise a point of order, Mr Speaker. I draw your attention to Speakers’ ruling 59/1, with regards to the member Deborah Russell who interjected on the previous speaker. I didn’t want to interrupt her speech at that time. She interjected while she was on her feet, moving about the Chamber, and was encouraged by those members around her at that time. I’d just like to, I guess, commend Maureen Pugh for her professionalism in continuing through that. I remind members that that is actually disorderly and would encourage, through you, Mr Assistant Speaker, reflection on that Speakers’ ruling.

ASSISTANT SPEAKER (Adrian Rurawhe): Thank you for bringing that to my attention. I didn’t witness Dr Russell on her feet. I did hear the interjection, but the member is correct. I’ll take some advice on what the correct course of action will be. I thank the member for his intervention.

ANGIE WARREN-CLARK: I would just, finally, like to make the comment that Dr Deborah Russell made a comment with real humility and acknowledged that there was a different way that we did these things and perhaps we can do better. Actually, I think that mea culpa on her part was probably a little bit overblown. She did a really good job chairing, and I think we across the floor can acknowledge that.

Finally, I would just say, in commending this bill to the House, that our Government values our marine environment. We have committed to a genuinely sustainable approach to the management of our seas and sea life. Let’s get on with it. I commend this bill to the House.

MATT KING (National—Northland): It’s a real pleasure to speak on the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill. I’d like to acknowledge, in the public gallery, supporters of Dan Bidois that are here not to hear me but to hear him in 20 minutes. They’ve got to put up with me in the meantime.

We support this bill. It’s one of many bills—many, many bills—that we’ve supported in this Parliament, in this current term. This bill is actually just correcting a simple drafting error in the Resource Legislation Amendment Act passed last year. We support it—the whole House does. But it does not warrant a stand-alone bit of legislation. For the benefit of those people in TV land, legislation has a first reading and then goes to select committee, second reading, and then committee of the whole House, where Supplementary Order Papers (SOPs) are brought in and changes are made. There is the third reading, then we vote, and then it becomes law. This coalition Government could simply move a motion that we move from stage one to the endgame, and we would have supported it—job done. Or, failing that, they could have included it in an actual statutes amendment bill that’s tracking through Parliament right now.

Now, this bill is going to save the Government $1.6 million a year, so I support that, but, ironically, the cost of getting there—getting this legislation through the House—is going to come close to that. So the bill is either being used to kill time because they’re disorganised or going to be used as a Trojan Horse to bring an SOP in at committee stage, and I’m still undecided about which it’s going to be. But Minister Parker has hinted that he wants to make Resource Management Act (RMA) changes such as reinstating appeal rights on residential boundary issues. So it’s one or the other: it’s going to be used as a Trojan Horse, or it’s just a waste of time because they’re not organised. I don’t know which one to pick.

Introducing an SOP to introduce RMA reform would be a cynical lack of transparency, which this Government is known for—like the oil and gas ban.

Hon Member: That’s right.

MATT KING: Yes. Fixing a drafting error simply ensures applicants for marine consents pay the costs of any board of inquiry. So it’s a mistake that was made, and it’s just crossing the i’s—sorry, dotting the i’s and crossing the t’s. Ha, ha! I knew I’d get that mixed up. These changes are minor and they don’t require any more parliamentary time.

Jamie Strange: You’re just warming up.

MATT KING: I’m just warming up. We supported this right at the get-go. In fact, we moved twice to move to the endgame to get it over and done with. We even suggested making it part of a statutes amendment bill. You didn’t take our sensational advice.

Angie Warren-Clark: Who didn’t?

MATT KING: This Parliament—sorry, the coalition Government. In 2014, it cost $310 a minute to run Parliament. This Government is wasting time and money on a bill that we all agree on. Being a relatively new MP, I’m seeing this blatant waste of time on bills, and it’s just plain wrong. The RMA amendment itself was 700 clauses, 250 pages—40 significant changes. It’s a big bit of legislation, and someone made a mistake. Mistakes happen. The coalition Government have made them. We’ve made them. We fix up our mistakes, but we don’t have to go through a full process to get the job done.

But given this Government’s recent cases of dodgy behaviour, I have grave concerns. Is it a Trojan Horse or is it just incompetence? This Government is a closed shop, an evasive shambles of a Government this country has ever seen. You cannot blame us for having zero trust in this current Government. I commend this bill to the House. Let’s get on with it.

JO LUXTON (Labour): I just have to say, Mr King, that it’s so not like you to be all full of doom and gloom. It’s a bit depressing.

Hon Member: Disappointing.

JO LUXTON: Yeah. But, anyway, thanks for the opportunity to speak on the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Amendment Bill. I want to acknowledge the Hon David Parker for his work on this. I think it’s important to acknowledge the Environment Committee, which I am not a part of, but it sounds like it’s been a process that they have worked well together on to get to this point.

So what the purpose of this bill is is just to allow the Minister to recover from an applicant the costs incurred in relation to a board of inquiry appointed under the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act 2012. Whilst this is a minor and technical amendment, it’s actually a really important amendment to this bill because, without this amendment, it will cost taxpayers hundreds of thousands of dollars. As Minister Salesa mentioned, it is about fairness. It’s about the taxpayer not having to foot the bill for this, but it also allows the opportunity for those that are applicants of a publicly notifiable marine consent to seek an estimate of costs likely to be recovered by the Minister; so it makes it fair for everybody all round.

As Angie Warren-Clark said, this Government values the marine environment and is committed to a sustainable approach to the management of our seas and sea life. This is something that I think is important to all New Zealanders, now and moving into the future. So when we have people that want to do something to the seabed that may be disruptive in some way, it is really important that we have these boards of inquiry to look at the potential implications or things that may happen because of it. So it’s important that the taxpayer doesn’t foot this bill—that it is a user-pays system when it comes to this. So I’m not going to go on for any longer. I just wish to say I commend this bill to the House.

Bill read a second time.

Bills

Maritime Powers Extension Bill

First Reading

Hon MEKA WHAITIRI (Minister of Customs): E Te Māngai o Te Whare, tēnā koe, otirā, e ngā mema katoa, tēnā tātou katoa. I move, That the Maritime Powers Extension Bill be now read a first time. I nominate the Foreign Affairs, Defence and Trade Committee to consider this bill.

Today, high schools all up this country descend on Palmerston North to compete for the grand national title of secondary kapa haka. So, on behalf of this side, the Government, we extend our warm wishes to every single kapa, their tutors, their whānau, and their supporters over these next few days in the very good electorate of Te Tai Hauāuru and the general electorate of Palmerston North.

Back to the bill, the Maritime Powers Extension Bill seeks to provide a domestic legislative framework for responding to drug-smuggling activity in international waters, beyond New Zealand’s territorial seas. New Zealand may be a small country in terms of its land mass, but it is responsible for the security of a vast area of surrounding ocean. We have the world’s fourth-largest exclusive economic zone, just to give an idea of the scale. Historically, this vast area of sea has acted as a barrier and protection from many of the ills and threats that affect other parts of the world. New Zealand has simply been too far away. In this regard, the tyranny of distance has served us well, but distance is no longer our friend when it comes to drug-smuggling.

In our long and often isolated coastline is our vulnerability. We can no longer rely on our geographical isolation as a deterrent. We have seen a marked increase in the number of smuggling operations taking place across the South Pacific over the past two years, including those targeting or implicating New Zealand. It is critical that our agencies have the tools to respond effectively to organised crime groups using ships on the high seas to bring drugs in large quantities to our part of the world, without impeding the legitimate movement of people, goods, and services.

Australia now has the legislative ability to intercept these shipments in international waters. New Zealand is increasingly likely to be seen as a softer target. The fact that illicit drugs tend to attract a high price in New Zealand also makes this country an attractive market. Currently, we have no law that explicitly makes smuggling drugs via international waters an offence in New Zealand. We have no legal framework that allows our Customs Service—or any other agency, for that matter—to take enforcement action against those who are involved in drug-smuggling on the high seas, 24 nautical miles out from our coastline, beyond our territorial waters and contiguous zone.

New Zealand is a signatory to the United Nations Convention on the Law of the Sea and the United Nations Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances. These conventions provide New Zealand with rights and obligations to supress the smuggling of illicit drugs in international waters. This bill would both address the gap in our legislative powers to deal with seaborne drug-smuggling and help us meet our international obligations under those United Nations agreements.

Specifically, this bill will give customs the statutory power to board, search, and, if evidence of offending is found, take necessary enforcement actions in respect of vessels in international waters beyond the contiguous zone in line with the powers that apply within New Zealand’s contiguous zone. That will include, in certain circumstances, the power to seize the vessel itself. It will also make it an offence, under the Misuse of Drugs Act 1975, to knowingly be involved in an effort to smuggle drugs to or from New Zealand. It will also ensure that these powers can only be exercised where customs have reasonable cause to suspect that a ship is involved in drug-smuggling. Customs will work with other agencies, such as the New Zealand Defence Force, to exercise these powers far offshore from Aotearoa New Zealand. However, customs’ new vessel, the Hawk V—the launch of which I was fortunate enough to attend as one of my early official duties as customs Minister—also bolsters customs’ capability to enforce our powers at sea.

I want to acknowledge the support of New Zealand First and the Green Party of Aotearoa / New Zealand for this bill. Collectively, we are committed to stopping the flow of illicit drugs that are causing lasting harm to New Zealand whānau and communities. This bill provides an additional option for customs to disrupt and dismantle the networks that are responsible for these harms. I also would like to acknowledge the Hon Nicky Wagner and the Hon Tim Macindoe, who as previous Ministers of Customs provided their support during the early development of this bill. Thank you also to the Government departments and agencies who have assisted with the preparation of this bill.

It is vital that our law enforcement agencies have all the tools available to combat drug-smuggling activities. As the risk of maritime smuggling is at its highest in the summer season, I think that we can all agree that there is a need to enact the bill as quickly as possible. I am therefore grateful for the support indicated by other parties and the chair of the Foreign Affairs, Defence and Trade Committee in making this happen. I commend this bill to the House.

SIMON O’CONNOR (National—Tāmaki): Thank you very much, Mr Assistant Speaker. As I begin, I just want to acknowledge all those who have kindly turned out in the gallery from the National Party today to hear this speech. It’s a bit of a surprise to me, but I’m thrilled. Thank you very much, everyone!

Hon Member: The good and the great!

SIMON O’CONNOR: The good and the great. No, in all seriousness, I will assure the House that in taking this call, I will end at the right time to enable Dan Bidois to make his maiden speech, and I am very much looking forward to that, as we have, welcoming him to the House.

This is a good piece of legislation, and I am very pleased to stand—as the Minister Meka Whaitiri already knows, I acknowledge that the National Party will be supporting this bill in its first reading and, all things accepted, through the House. Look, as the chair of the Foreign Affairs, Defence and Trade Committee and also the National Party spokesperson for customs I’m very aware of the import—all puns intended—of this bill and the powers that customs need.

Minister, thank you for the work that you have taken here, also acknowledging our former Ministers Tim Macindoe and Nicky Wagner—they have worked hard in this portfolio, and you continue to do so.

At the moment, it’s ambiguous whether or not the New Zealand Customs Service has authority and jurisdiction to intercept and interdict vessels in international waters. It’s very clear that customs can board and seize vessels inside New Zealand’s territorial waters, arguably even into our exclusive economic zone, but beyond that it is not clear. I think, fundamentally, what this bill is seeking to do is to stop any particular legal challenge that might come if New Zealand was to try and enforce what we believe to be our current laws around this. So this tidies things up. It makes things very specific that New Zealand will have the rights to board, to search, and, where needed, to hold ships that are bringing contraband into our country.

Really importantly, it once again aligns New Zealand with our international obligations. It’s no surprise to anyone who sits on the Foreign Affairs, Defence and Trade Committee that we have a numerous number of treaties. We’ve been looking at a number of them of late, but these ones are particularly around the law of the sea—what’s often known as UNCLOS, the United Nations Convention on the Law of the Sea. We have signed up to that, and the long and the short of that is that New Zealand, as a responsible international player, seeks to ensure that drug trafficking is minimised in the world. So I suppose, put in a different way, it’s not really simple for us to just await the drugs to arrive at our border and to try and interdict them there. We have a responsibility, and rightly so, to work with our international partners in international waters—and importantly too. In fact, there are customs officials working in overseas countries who look right from the source of supply. And, really importantly, and I think most in the House would already know or understand this, a lot of the drugs, while they are coming out of Asia, are actually coming from North America as well. Canada I believe is a relatively popular spot. So we are working with those countries as well.

Look, the scourge of drugs—and this is not going to be a long anti-drug element—is a major problem. But, really importantly, it’s the precursors which are coming into New Zealand which are of particular concern at the moment. A couple of weeks ago, I had the good pleasure of being able to take the Foreign Affairs, Defence and Trade Committee members to visit the New Zealand Customs Service, particularly in their Auckland base, and it was good to talk to the officials and leading officers there about the work that they are undertaking. One of the most notable elements is around precursors, which are being brought in for drug manufacture, particularly for MDMA, or what we would know as ecstasy—sorry, I don’t want to presume that members here would know what’s that’s about; I don’t want them to perjure themselves in the House, privileged or otherwise. But working on these precursors is relatively important and, if I might, I will acknowledge those officials, who now have a successful prosecution for that diamanté horse’s head—a major drug-smuggling there.

So important work is ongoing. Customs, though, needs greater powers, and I think from the National Party’s side—the Opposition side—we are keen to support this. One thing we will be looking at very carefully is how these powers can be used. It probably goes without saying that we, as a Parliament, will not just want to give unfettered powers to the Customs Service, regardless of the good work they do, but unfettered powers for them to interdict ships in international waters is a substantial power that they will be given. We will look closely at the regulations in this bill. We’ll also want to be very clear of how that is reported back, both to the Parliament but also to the Minister, to understand when it’s used. I suppose the fundamental element when great powers are given is that we also expect quite a high level of responsibility as well in that regard.

Importantly, this bill doesn’t sit alone. It is working on a range of legislation that has been passed of late, and particularly by the former National Government. We had worked quite hard as a Government to increase the powers and influence of customs to make sure they protect the borders. I should probably add within that—and quite importantly—something which came through when the select committee was visiting the Auckland Airport side of things, which is that our customs is not simply working on stopping drugs coming into the country. You’re also looking at elements such as objectionable materials, and I suspect too, when it comes to some of the international waters elements, it could be around people-trafficking as well.

So I suppose the encouragement remains that we support the Customs Service in their work. They are keeping us safe through their efforts, and when they come to us—in this case, in a request for a change of legislation to help their work—we say yes, but we do it with caution, as I’ve been saying. Bills like this provide enormous power to a Government agency, so in the select committee we’ll be very interested to hear from, obviously, customs themselves to understand exactly what they’re after, but I, for one, and certainly as the chair of the committee, will be very interested to see what safeguards are in place to ensure that those powers are carefully used. In particular, it’ll be interesting, Minister, as to how they’ll report back either to the Minister or to the Parliament around how those are used.

So, fundamentally, we have a good bill here. As I say, it’s something which needs clearing up. There’s been too much ambiguity to date and I, for one, don’t want to see the Customs Service exercising their current powers and then finding that challenged in the court, and some drug-smuggler is let off on a technicality. I think it’s also fundamentally important that we respect the United Nations. If we’re going to sign up to these treaties, then we need to make sure that we put them into our domestic law as quickly as possible.

But look, as a politician and certainly as a National Party member, I do believe in trying to keep my word. I think, I say to the whips, I have managed to maintain—in fact, the clocks are broken—about the eight or nine minutes required, but I also promised that we wouldn’t keep talking. We wouldn’t keep talking to—even despite what the Speaker might be indicating to me, I won’t keep chewing into Dan’s—[Interruption] They want me to keep going for two—[Interruption] Oh, good Lord! Oh, all right. All right. Well, this is a good insight for people watching at home into how this Parliament works.

Returning to the bill in this last one minute and 40 seconds, look, UNCLOS—there’s always a problem with using acronyms. Look, it’s the United Nations Convention on the Law of the Sea. Now I’m sure that has just brought an amazing insight into a number of people in this House, but the other one we haven’t talked about is another—

Hon Gerry Brownlee: How many members?

SIMON O’CONNOR: Well, actually, there’s not enough members at UNCLOS, but the other one is the United Nations Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances. Obviously, narcotics are well understood to us—not, I’m sure, by practical experiences—but the psychotropic side of things is more those which are going to have an effect on your mental state. So the likes of ice—or meth, as we know it—falls into that. The upcoming scourge that’s coming—not, fortunately, to New Zealand at the moment, but it’s harassing America—is the use of fentanyl. That would strike itself more as a narcotic, but that’s our response to the United Nations Convention Against the Illegal Traffic in Narcotic Drugs and Psychotropic Substances.

So, again, I suppose the fundamental element is that this bill in the name of Minister Whaitiri is an opportunity for us to align ourselves appropriately to our UN resolutions and to make sure—

SPEAKER: Order!

SIMON O’CONNOR: —that this speech concludes in good order and time.

SPEAKER: Thank you. The member will have a few seconds next time the bill comes up.

Debate interrupted.

Maiden Statements

Maiden Statements

DAN BIDOIS (National—Northcote): Tēnā koutou katoa. Ko Tainui te waka. Ko Waikato te awa. Ko Ngāti Maniapoto te iwi. Ko Ngāti Huiao te hapū. Ko Kakepuku te maunga. Ko Te Kauae te marae. Ko Michael Bidois tōku pāpā; nō Hangatiki tōku pāpā. Ko Leah Harding-Bennett tōku māmā; nō Hokianga tōku māmā. Ko Dan Bidois ahau. Nō reira, tēnā koutou katoa.

[Greetings to all. Tainui is my canoe. Waikato is my river. Ngāti Maniapoto is my tribe. Ngāti Huiao is my kinship group. Kakepuku is my mountain. Te Kauae is my marae. My father is Michael Bidois; he hails from Hangatiki. Leah Harding-Bennett is my mother; she is from Hokianga. I am Dan Bidois. Therefore, greetings to all.]

Today, I rise in the House for the first time to speak on behalf of the people of Northcote. I’m here as the result of a by-election that was held on 9 June, after the departure of the Hon Dr Jonathan Coleman, a man who held this seat for 13 years, with nine of those as a Cabinet Minister. On behalf of the people of Northcote, I wish to thank Jonathan for his service to the Northcote electorate. I wish to thank the people of Northcote for their support and confidence in me. It’s truly an honour to be your representative in this House.

To the National Party—in particular, party president, Peter Goodfellow; leader, Simon Bridges; Paula Bennett; Alastair Bell, Andrew Hunt, David Patterson, the Young Nats; the delegates that chose me as their candidate; all of the volunteers and staff who helped out on our campaign; and to the Northcote electorate executive—thank you for your dedication, for your support, and for your encouragement. I am indebted to you all. To the departing member of the Northcote electorate executive, Gavin Cook, thank you for your service to our party over the 40-plus years that you have been in the position, and to your wise counsel offered to me in the past few months. To my family—Mum, Dad, Wayne, Fleur, Chontelle, and Rob—thank you for your ongoing support for my often crazy and unconventional endeavours.

Northcote is the hidden gem of Auckland and an area that I could not be more proud to represent, with its diversity, collective aspirations, entrepreneurial spirit, and strong sense of community and identity. What began as a place with only a handful of settlers in the early 1800s developed into a fast-growing, ambitious, and compact electorate, especially after the construction of the Auckland Harbour Bridge in 1959. Today, the tight-knit communities of Birkenhead, Glenfield, Beach Haven, Birkdale, Chatswood, Hillcrest, and Northcote continue to thrive.

The proximity of Northcote to downtown Auckland attracts many young professionals and aspirational families to the electorate. It is a diverse electorate in terms of ethnicity, socio-economic groups, professions, and generations. And yet despite this diversity, the people of Northcote share some common threads; they are hard-working, entrepreneurial, and family-orientated.

Like many other parts of Auckland, Northcote has its fair share of challenges. With the scale and pace of growth on the North Shore over the past 20 years and in the foreseeable future, investment in key infrastructure such as public transport, schools, healthcare services, car parks, and sporting grounds have yet to match this growth. Congestion is a big problem for many in my area, and the apex of this congestion is Onewa Road, the main arterial route to the CBD. I’m committed to ensuring that Northcote gets its fair share of investment to manage these challenges and to being vocal on all matters, local and national, which impact the people of Northcote.

I come from a place far removed from this House, both literally and figuratively. At nine months old, I was lucky enough to be adopted into a humble, working-class family. My parents are small-business owners. My dad drives trucks and my mum is a saleswoman. They didn’t grow up with much, yet they made a better life for themselves through hard work, personal responsibility, and private enterprise.

Two women shaped my life views in particular: my late grandmother, Millicent, and my mother, Leah. Millicent grew up poor in Hokianga and was widowed at 35 with two young daughters after her husband, Bill Harding, died from an injury that he sustained during World War II. A devout Catholic, she never remarried or dated and instead dedicated the next 60 years of her life to raising her two children and to helping to raise my siblings and I.

My interest in politics stems from my grandmother Millie. She was a staunch National Party supporter ever since her local MP, Sir Robert Muldoon, helped her into a State house in Glen Innes in the 1960s. Surviving on only a modest widow’s pension, having access to a State house meant that she could dedicate herself full time to raising her two children and, later on, to helping to raise my sisters and I. She was a person of deep contrasts—for example, even though she was a National supporter, she did have a soft spot for Winston. I guess none of us are perfect. And even though she was poor, Māori, and doing it rough as a widowed mum, she believed in personal responsibility and freedom of choice. She believed in a hand up, not a hand out. Her values became my values, and I know that she would be most proud to see her grandson serve in the House today.

The other woman was my mother, Leah, who attended boarding school in the electorate that I now represent. My mother faced her fair share of challenges ever since she adopted me, from taking care of a sick baby, later dealing with a troubled and misbehaving kid, watching her son battle cancer, struggling with a separation, and raising three children. I’m inspired by the grit and determination my mum displayed to rise above her challenges and provide for her family. And she worked hard, at one stage holding down eight different jobs in order to make ends meet. My mother’s story is indicative of the promise of living in New Zealand: that anyone can get ahead and make a better life for themselves and their family if they work hard and they have the determination to follow through.

Despite this loving family, I was far from a role model growing up. I spent most of my high school years either in detention, chasing girls, or getting into mischief. I was probably on the pathway to prison if it weren’t for an intervention my high school principal made, which changed my life for ever. My high school principal convinced a local butcher next to my high school to take me on as a butcher’s apprentice. Through this job, I developed discipline, customer service skills, discovered the joys of earning a pay cheque, and later discovered my passion for economics. After completing a butcher’s apprenticeship, I was mentored by a senior leader of Woolworths to go to university and ended up with three degrees in economics, marketing, and commerce from the university, before later completing a fourth degree in public policy at Harvard University.

That a high school dropout can later graduate with a Master’s degree from Harvard University speaks to the promise of growing up in a free and equitable country like New Zealand, where any kid, no matter where they come from, whatever their skin colour, or what school they attend can succeed if they have the determination, the aspiration, and the work ethic to do so. New Zealand is one of the few places where this story is even possible, and it’s this aspect of our society which I seek to uphold and strengthen.

An upwardly mobile society based on merit and equal opportunity is the endeavour that brings me into this House today—where every Kiwi kid has the opportunity to reach their potential and fulfil their God-given talents; where every Kiwi kid receives a great start in life through education and gets ahead through private enterprise.

Like all of you, I’m here today because I want to improve the lives of New Zealanders and improve the social, economic, and environmental future of this great nation. But New Zealand’s future success first and foremost depends on creating a vibrant, dynamic, and knowledge-based economy, for it is only through a strong economy that we’re afforded the opportunity to strengthen our environment and address our social issues.

I’ve always believed in the power of free and competitive enterprise to transform lives and lift all of our communities to a better place in life. It certainly worked for me, from working for $6 an hour as a butcher’s apprentice, then as a strategy consultant with Deloitte, then as an economist at the OECD, and most recently as a senior executive for Foodstuffs. It’s also worked for my family, from seeing my parents work their guts out to get ahead and from seeing my older sister’s struggle from pay cheque to pay cheque. Through my life and through the life of my family, I’ve witnessed the engines of economic growth in our society and its ability to reward hard work, incentivise people, and, ultimately, improve lives.

Yes, saving rates, interest rates, unemployment rates, real GDP growth rates, and bond yields are all important measures of economic progress at the macro level. But, more importantly, a strong economy is about individuals: the young kid who’s employed and earning money instead of roaming the streets looking for trouble; the father who takes pride in the fact that he is providing for his family and ends each day with a sense of accomplishment; the disabled person who feels included in society and that they are contributing to something larger than themselves; and the single mother who feels empowered, free, and independent, and is able to provide for her children.

I am proud to be a member of the National Party: a party that backs Kiwi businesses and strives for a strong economy first and foremost, where everyone can get ahead and improve their lot in life; a party that favours free, competitive enterprise, where Government sets the rules of play and then just gets out of the way.

My time overseas, living and working in America, France, Kazakhstan, Ukraine, and Malaysia, gave me an immense appreciation for having grown up in this country. It made me proud to call myself a New Zealander, and it also gave me the opportunity to reflect on some of the great challenges that our nation faces in the coming years: climate change; rapid advances in automation and artificial intelligence; a population that’s getting older and living longer; a shifting centre of geopolitical and economic power from the West to the East; and accelerating globalisation that’s calling into question the role of the nation State. Responding effectively to these challenges and opportunities will determine whether our great nation endures or declines. This is going to be a monumental task, but I relish the opportunity to play a small part of this effort.

I’m positive that New Zealand can and will rise to the challenges we face to prosper well into the next century, provided we take a long-term perspective to policy development and effectively capitalise on our natural advantages as a nation. We are small enough to be nimble and agile in our policy responses. We are not straddled by the chains of history; we are young and forward-looking as a nation. We dare to dream big and we are not afraid of rolling up our sleeves and mucking in.

I’m immensely proud to call myself a New Zealander and to call this place home. I’m proud to represent the people of Northcote in this House in what is the best part of Auckland to live in and raise a family. And I’m proud to be a member of a party that unashamedly backs Kiwi businesses and entrepreneurs to show us the better pathway to a better life.

There’s a Māori proverb that says that a person with a narrow vision sees a narrow horizon, while a person with a wide vision sees a wide horizon. The horizon I see for New Zealand is positive, full of economic opportunities for our kids and their kids, and prosperous. It’s my purpose in this House to ensure that the people of Northcote are included in this horizon and that our nation’s actions reflect these aspirations.

Tēnā koutou, tēnā koutou, tēnā koutou katoa.

[Applause]

Waiata

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

Bills

Maritime Powers Extension Bill

First Reading

Debate resumed.

Hon WILLIE JACKSON (Minister of Employment): Kia ora, kia ora, Madam Deputy Speaker. Tuatahi, e tika ana ki te maumahara tō tātou rangatira kātahi anō kua hinga, te pāpā a Shane Jones, Munro Peter Jones. Nō reira e te pāpā, kei te mōhio mātou tō āhua, ko koe te pukumahi i ngā wā katoa. Nō reira e te pāpā, moe mai, moe mai, a moe mai rā.

Ka nui tēnā, ka nui tēnei wā hoki ki te mihi ki a Dan Bidois mō tana kōrero ātaahua i tēnei rā, nō reira tēnei te mihi ki a ia me tana whānau i tēnei rā, nō reira ki a koutou Te Rōpū Nāhinara, tēnā koutou. Ngā mihi ki a koutou.

[Kia ora, kia ora, Madam Deputy Speaker. Firstly, it is only proper to remember our recently deceased chief, the father of Shane Jones, Munro Peter Jones. Therefore, sir, we know what you were like: hard-working all the time. Therefore, sir, rest in peace.

Enough of that, and this time is also important to congratulate Dan Bidois for his lovely speech today, so I acknowledge him and his family today, therefore to you the National Party, greetings. Greetings to you all.]

Kia ora, Madam Deputy Speaker. I just wanted to acknowledge, first and foremost, our colleague and friend Shane Jones for the loss of his father in the last day. I was just doing a mihi to him and the whānau and wishing them all the best in the North. I’m sure everyone in the House would support that. I also, just before continuing on, wanted to mihi to the young man Dan Bidois, who did a tremendous speech. He did a good job here today. I think he is a role model for Māori; it’s just a shame he chose the wrong party to represent. But well done to him and to his whānau today. Those are always special moments.

I mention Shane Jones because Shane Jones is so anti-drugs—anti-drugs. This Maritime Powers Extension Bill is all about stopping the drug dealers coming into the country. We’re seeing international crime groups targeting New Zealand by smuggling large quantities of illicit drugs into the country. So this bill is needed to give authorities the powers to act outside our territorial waters. This will allow customs officials to intercept mother ships. They sit outside the 24-nautical mile zone with a supply of drugs and they send in smaller boats to try and smuggle their rotten cargo ashore.

Our country’s become more and more appealing for these drug-smugglers who don’t care about communities—don’t care about the communities that Shane Jones represents in the North. Why the Hon Shane Jones is so vigilant in this area is because we have had our communities ravaged by these drug dealers. Sadly, we see intergenerational drug use along with intergenerational unemployment. We see it in the North. I’ve seen it myself in South Auckland. So it’s time that we get a strategy together, and that’s what this bill’s all about.

So I want to congratulate our Minister Meka Whaitiri on her vigilant work. Part of the reason why she does this is because she knows the type of damage that drugs and drug dealing can cause in Māori communities, particularly communities that she represents in the Ikaroa-Rāwhiti. So I say well done to her. Also well done to the Foreign Affairs, Defence and Trade Committee, who sat on this, led by Simon O’Connor over there, who went on and on and on before the Dan Bidois speech. Well done to our select committee—

Hon Ruth Dyson: Excellent speech!

Hon WILLIE JACKSON: Thank you very much—for moving this through, but the essence of this is to protect our communities and you cannot doubt that—a structure of support for our customs people, a strategy in place to stop those dirty, rotten drug dealers. We’re talking about $1.8 billion in social harm that’s happening annually, and this includes police involvement, courts, and prison beds. So, 45,000 Kiwis receive support each year to reduce their alcohol and drug use. We are now on the way in terms of turning that around, all thanks to this Government. So I have no hesitation in recommending this bill to the House. Kia ora.

DEPUTY SPEAKER: I’ll just point out to the member resuming his seat that it is actually a first reading. It hasn’t yet gone to the select committee.

KANWALJIT SINGH BAKSHI (National): Thank you, Madam Deputy Speaker, for your contribution also. I was about to throw a point out that the Hon Willie Jackson is on the second reading of this bill, and the rest of the House is on the first reading, so that shows how much involvement we have got from the Ministers. So that was a really, really good contribution, Hon Willie Jackson. I really appreciated it.

Before I go further, I would like to acknowledge the contribution of our newest member, Dan Bidois. He did very well, and I hope he will have a very long innings in this House. Whereas Hon Willie Jackson said that he was in the wrong party, I think he is in the right party, because whatever he did, that is what is expected from a National Party member.

I would also like to pay my condolences to the Hon Shane Jones on his father’s passing away. I hope that when we see him, we will do it in person also.

It’s my privilege to stand in the first reading of the Maritime Powers Extension Bill and support it during the first reading. As the previous speaker from our party, Simon O’Connor, mentioned, we will be supporting this bill through the first reading and the process, and, hopefully, during the select committee there will be some more changes. I would also like to acknowledge the Hon Nicky Wagner and the Hon Tim Macindoe for their contribution to this bill, which was developed during their leadership.

We live in a country which we feel is a fortunate opportunity for us. It is a neat and clean place to live in and to welcome our tourist guests with open arms. Some of these people who want to enter New Zealand through our various ports of entry have malicious intentions. Due to these bad intentions, over the years there has been a rapid increase in the number of attempts to smuggle drugs into New Zealand. The New Zealand Customs Service does a good job to stop that and they have a mandate to stop harm to New Zealanders.

The New Zealand Customs Service plays an important role in this. We want to ensure that New Zealand takes all steps possible to make it harder for the global criminal groups to target New Zealand. We know that each year, the use of illicit drugs, particularly methamphetamine, is estimated to cost New Zealand $1.8 billion in social harm. The criminal networks don’t care about the devastating effects of these drugs. They are motivated by greed and a relatively high price in New Zealand, and they are getting more sophisticated.

Customs is seeing more and more importation of these drugs, and the number of attempts to smuggle these drugs has increased in recent years. Last year, it is estimated customs did a great job in stopping these drugs. It is estimated that more than a tonne of methamphetamine was prevented from being imported into New Zealand, and the street value of that drug was around a billion dollars. In 2015, the seizure of these drugs almost tripled, with customs and police intercepting 293 kilos compared to 105 kilos in 2014.

Keeping methamphetamine off our streets and away from our communities was a big priority for the National Government. That’s why we were taking the initiative to make sure that this bill went through as soon as possible. Most importantly, these seizures have protected our families and the wider community from a considerable amount of potential harm.

We hope that this bill progresses as soon as possible and that it stops such importation and gives the authority to customs to work in international waters so that we can intercept such consignments coming through to New Zealand. I commend this bill to the House.

DEPUTY SPEAKER: Just before I call the next member, I’ll just point out to members that the time isn’t working. So we’ll go back to the old-fashioned way in which I’ll ring a bell at two minutes.

Hon RON MARK (Minister of Defence): Thank you, Madam Deputy Speaker. Look, it’s a pleasure to be able to speak on behalf of New Zealand First on the Maritime Powers Extension Bill. I know that—

Brett Hudson: The old sea dog, Ron Mark.

Stuart Smith: Are the P-8s on the way, Ron?

Hon RON MARK: It was a good dinner, was it? It shows. It’s an interesting bill—

Hon Christopher Finlayson: Yeah, like your leader after lunch.

Hon RON MARK: —because I know the reasons and the rationale behind the bill, a bill that was put together under the Hon Chris Finlayson’s Government—and he’s obviously enjoyed dinner as well. I’ve got to say of young Mr Bidois, knowing some of his family: it’s good to see him here.

It’s an interesting bill, and it doesn’t surprise me that most of the focus in the debate thus far has been around what I would describe and New Zealand First would describe as the scourge of drug trafficking and the methodology by which international drug traffickers seek to get their wares into New Zealand. We know—the documentation and the papers are all very clear—that one of the reasons we’re seeing an upswing in the illegal importation into New Zealand of illicit drugs and their precursors is because of the profitability. The National Party, more than any party in this House, understands the market forces, or says it understands the market forces, and if you look into that sort of philosophy, it’s easy to understand why drug barons, drug lords, drug traffickers see some lucrative gain to be harvested here in New Zealand by peddling their wares amongst our vulnerable.

It’s an easy argument to put up in support of this bill, and New Zealand First supports that, but, as the Minister of Defence, one of the things that concerns me is the fact that, for this bill to have effect, it needs an enabler. The enabler in this case is and always will be the Defence Force, particularly the men and women in the navy and in the air force.

Brett Hudson: Replace those Orions.

Hon RON MARK: Mr Hudson, I know—he’s commenting to me across the House, and that’s because I know he understands maritime law. He’s probably going to make a far better contribution on this bill than I will, because I do not profess to be an expert in maritime law, but I do know a little bit about the responsibilities that skippers, captains of warships, must bear, and the responsibility of ensuring that their crew, firstly, themselves do not contravene international law; secondly, that they do not jeopardise the safety of the vessel that they are in command of; and, thirdly, that they do not jeopardise the lives of their sailors, of the service personnel on board in the execution of their duty. I understand also that there is a line of authority that exists between the customs officers who are placed on board those vessels—and let’s be clear: the bill we’re talking about empowers customs officers to exercise their authority, but from a naval vessel. The lines of authority are very clear and set down in international law, and it doesn’t matter what the customs officer may think, what sort of intelligence that person may have, and what their aims or goals may be; the skipper of the vessel cannot breach the international laws of the sea.

The reason that this piece of legislation is important is because it gives the power for the skipper of the naval vessel to actually put aboard or to—I think the naval term is to “visit”—visit a foreign vessel that is believed to be engaged in illicit trafficking activities or illegal activities on a scale and a size that is recognised internationally and is specifically noted in the convention that this bill seeks to ratify.

So as the Minister of Defence, it concerns me that when we pass laws such as this, we are cognisant of the duties and responsibilities that we’re now asking our naval personnel in particular to exercise and that what they have is the full toolbox of law on their side to enable them to assist customs to (1) pull alongside, (2) board or visit that foreign vessel, (3) search it, (4) detain the people on board, and (5), at worst, to confiscate—either take into tow or take command of—that vessel and return it back to New Zealand waters and to New Zealand authorities. Understanding the lines—and I’m really looking forward to the select committee looking into these questions to make sure that we’ve got it covered off right, because this is a bill that started, for all the right reasons, under the previous National Government, which this Government is responsibly picking up and advancing. So it will be encouraging for me as the Minister of Defence to know the select committee has cast its eyes across these questions of legality to make sure that our Defence Force personnel are not jeopardised and that they are not short-changed in terms of their powers. So I’m keen to see that.

Essentially, the key points that the law is going to address are the questions around the fact that the current international law doesn’t provide for the right to visit vessels on the high seas—that is, in international waters—that one suspects of smuggling drugs unless they have flag-State consent. This bill provides that if one does have consent, or if the vessel doesn’t have a flag—and I’ll get into that—then one can not only board and take off the drugs but also prosecute under New Zealand law. This would require bringing the people to New Zealand, which is another question again, if that vessel has been apprehended, let’s say, for argument’s sake, just outside of the Fijian exclusive economic zone (EEZ) or just outside of, you know, Vanuatu’s EEZ or maybe off the coast of the Horn of Africa.

So those are questions, and we know, from our operations that the navy’s been engaged in to date, that New Zealand Defence Force personnel, particularly from our Royal New Zealand Navy, have been involved in some massive drug busts. I think there was one—$235 million worth of drugs apprehended. Now, that was not actually just an operation involving our navy. That involved air force capabilities as well, which, I guess, brings me to the next point, and I’d ask the House at this point in time, as we pass this first reading, to consider, going forward, what capabilities the Defence Force is going to require to do this sort of work. The combination of intelligence, surveillance, and reconnaissance, of a P3 or a P1 or a C Hercules or a P8 to do that sort of work, concurrently with a naval frigate or an offshore patrol vessel on the water, jointly staffed, manned, crewed by customs, police, and naval personnel, is what actually delivers the punch at the end and actually enables us as a nation to protect ourselves. So we have to have a capability. We have to have a capability that can deploy over long ranges and have that level of endurance, but we also must have the law that protects our personnel when they finally do make that decision.

The point to note in here is that if the vessel we’re talking about in this legislation is unflagged, this law is quite clear: the skipper has the authority to put the customs police and his own crew aboard and to do what has to be done. Where the grey area is is when the vessel is flagged. At that point, the communications have to come from the skipper, back through joint force headquarters, and then out to the flag nation, where we are required to ask for consent to board. Now, all things being equal, if they’re all signatories to this UN convention, they’re going to give that consent. The question then becomes a little murky if they do not. We know there are many nations out there who are not too good when it comes to the corruption indices, who turn a blind eye to drug trafficking, and we’re seeing quite a bit of that on the news lately with a certain particular nation.

So I’d just say to the House: I’m looking forward to this bill coming back from the select committee, looking forward to the select committee giving some consideration to the legalities as they affect the navy, as they affect our skippers, who will be the ones held accountable for decisions that are made—either rightly or wrongly—as to whether or not there are gaps in the legislation, or whether there are some things that we just have to accept where the legislation and the Treaty don’t quite go as far as we might well have liked. Fundamentally, at the end of the day, this is about protecting our nation, and it’s about protecting our service personnel who will be doing this work.

HARETE HIPANGO (National—Whanganui): It’s quite timely that I am scheduled to follow the speech of our Minister of Defence. Before I do though, in taking this short call, I first of all acknowledge my colleague Dan Bidois in giving his maiden speech and well supported by his whānau here today. Secondly, the last time that I spoke in this House was on the evening of the tragic seven-death car fatalities in my electorate of Whanganui, north of Waverley. So my thoughts again are with the grieving families as they—the final passage of their loved ones. So this is the ebbing and flowing of life, and as grief washes over the families, I now turn to speaking and addressing the House on the Maritime Powers Extension Bill.

So the Minister of Defence has shared with us his insight and analysis of the bill. Just last evening, there was a gathering of many of us from here in the House, courtesy of the American ambassador, for the Fourth of July celebrations. I had the opportunity to reconnect again with Rear Admiral John Martin, chief of the Royal New Zealand Navy. At the time I didn’t know that I’d be speaking to the House on this bill. Had I, I would have addressed these issues, but I certainly acknowledge the Minister in terms of heeding the service and the regard that we have for our service personnel. This bill is very much about those who will be giving service on those surveillance vessels within the navy. I also seized the opportunity because last night I briefly met with the Chief of Defence Force on his first official appointment and occasion last evening—Air Marshal Kevin Short. I make reference because, Aotearoa, we are a small nation, and these are the relationships that we have, and we are able to duly acknowledge each other for the contributions that we make.

In being a small nation, Aotearoa New Zealand has a vast, vulnerable, and exposed coastline. Our coastline is 15,000 kilometres; that is 9,300 miles. It’s the ninth-longest in the world—just a little bit of information there—following behind Canada, Norway, Indonesia, Greenland, Russia, the Philippines, Japan, Australia, and the USA. So because of the expanse and vastness of this coastline, we are terribly exposed and vulnerable. Drugs are a plague and a scourge in our society. This is an area that—having worked in the criminal law field, I know what a scourge it is, and it needs to be purged from our communities.

This Maritime Powers Extension Bill will enable—picking up on the word “enable”. A key focus is about preventing harm to those in our community. So this bill amends the Customs and Excise Act 2018, and also the Misuse of Drugs Act 1975. It has the following objectives: “to provide the New Zealand Customs Service … with an additional option to disrupt drugs smuggling.”; also, “to establish clear jurisdiction over offences under the Misuse of Drugs Act”.

So there was reference to the detail, which will be canvassed and scrutinised with keen eyes. Seated here in front of me is my colleague Chris Penk, who is a former naval officer of both the New Zealand and the Australian navies. My colleague Chris serves on the Foreign Affairs, Defence and Trade Committee and will have a particular investment in terms of this and the service that he’s given there.

So a key focus is about preventing harm and making it harder for transnational criminal groups targeting New Zealand. Many of us will recall that on the news—I certainly do, very clearly—there was an incident back in 2016, I believe, where—Operation Frontier it was—there was some 449 kilograms of methamphetamine that had been located in the back of a campervan, with a further 52 kilograms that were buried at Ninety-Mile Beach. There was another incident in February 2017 where a New Zealand - flagged yacht was intercepted off the Australian coast, just east of Sydney, with 1.4 tonnes of cocaine. Now, the fiscal value of that was $320 million, but it’s about the value, and the scourge, and the imposition on the health and safety of our community.

So my call is short this evening. The detail will be scrutinised before our select committee before it comes back. I look forward to hearing speeches and addressing the House at the second reading. Thank you, Madam Deputy Speaker.

LOUISA WALL (Labour—Manurewa): Tēnā koe e Te Māngai o te Whare. Thank you for the opportunity to speak. Sorry, I’ve lost my voice after last night, I’m not sure why. Anyway, on this, the Maritime Extension Bill, on this, the first reading—and I do so as a member of the Foreign Affairs, Defence and Trade Committee. Like my colleague Harete Hipango, I too want to talk about the context and the need for this piece of legislation. It really does stem from a 2015 Cabinet paper, and then a 2018 Cabinet paper that essentially has highlighted that it’s true—that 17,000 kilometres of New Zealand’s coastline is providing a bit of a highway for drugs to come into our country.

Just a bit of context out there: so, in 2015, we intercepted meth—258 kilograms. It had a street value of $219.8 million, and ephedrine at that time was the other big player—761 kilograms valued at $87.8 million. As Harete Hipango pointed out, in June 2016, 448 kilograms of meth valued at $438 million was found in a campervan in Northland. So this trade is growing and expanding, and it’s growing and expanding here because we have the highest prices for cocaine and ecstasy in the world, which I find fascinating. So a gram of cocaine in New Zealand, based on the Global Drug Survey in 2018—it’s outrageous—is $360. One pill of ecstasy costs $35. So, wow, what an amazingly lucrative business.

So where are these drugs coming from? Well, we know they’re coming from Hong Kong, from Zhangzhou. They’re also coming from Myanmar, Laos, and Cambodia. These are based on reports from the United Nations and other international monitoring agencies. So the other interesting part of all of this—and I didn’t realise this, and I do and I should reference that this bill also incorporates New Zealand’s rights and obligations under article 108 of the United Nations Convention on the Law of the Sea, and article 17 of the United Nations Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances into our domestic legislation. In international shipping law, actually, vessels can seek shelter in New Zealand waters and bays and inlets without clearing customs. So that’s a really interesting situation, I guess, that we find ourselves in.

So the intention of this piece of legislation is to make sure that our agencies, and namely—as my colleague the Hon Ron Mark has highlighted—those agencies, our Defence Force and our Customs Service, who will provide the vehicles that will patrol our waters, are going to help detect these illicit drugs.

I also neglected to contribute the actual harm to New Zealand of these illicit drugs. We’re talking about a social cost that’s estimated at $1.8 billion in social harm annually. The Drug Foundation have said that that involves 45,000 New Zealanders who receive support for their drug and alcohol addiction. So that combined cost also looks at the investment by the police, by our courts, and by our prison beds. These illicit drugs actually are costing us a lot of money. So this legislation, I believe, and we obviously believe, is part of a solution to detecting these drugs while, hopefully, not just detecting but providing some sort of—you know, with increased patrols maybe not so many people will get into the trade. So who knows? It may prove to be a deterrent. Time will tell. The reality of us having the vehicles out there on our waters patrolling an extension of our borders to make sure that these drugs do not enter our territory is incredibly important.

I don’t really want to speak for much longer. I don’t think it’s going to be valuable for the House’s time for me to do that, but can I just say I look forward to hearing from the submitters and, actually, us quantifying a bit more the actual damage to our country through this trade, and us all working together to stop these drugs coming into New Zealand. I do have to read this because I did do a bit of research, but heroin apparently is coming mostly out of Afghanistan; cocaine from South America; and amphetamines from China, South-east Asia, West Africa, and the Americas. And the other context that we should all be really interested in is that drugs are also coming to New Zealand via the Pacific and from New Zealand to the Pacific and to Australia, but the countries where we we’ve detected these illicit drugs have been Fiji, Samoa, Tonga, Papua New Guinea, Vanuatu, and Timor-Leste. So, obviously, if we can stop the flow of those drugs we’re also going to stop the impact on our Pacific brothers and sisters.

We know that there is an increasing drug problem in the Pacific. So this legislation isn’t only relevant for us but it’s also relevant for our Pacific Islands Forum nation partners, I’ll call them, and I also want to highlight that. This also provides a really good opportunity for us to work with our Australian colleagues and other colleagues around our Asia-Pacific area so that we can work collectively to get this rubbish off our streets. Kia ora.

CHRIS PENK (National—Helensville): Thank you, Madam Deputy Speaker, for the opportunity to rise and speak in this, the first reading of the Maritime Powers Extension Bill. I wish to make a relatively brief contribution focusing on the context of this proposed legislation, its purposes, and ways in which it can, hopefully, achieve the aims that it sets out to.

As for the legislative context, we’ve already heard on both sides of the House some good background regarding this, including that it will change our Customs and Excise Act and the Misuse of Drugs Act. I’ll note only in passing that various colleagues have spoken eloquently on the scourge of drugs and the desire that we must have as a Parliament, and, indeed, as a nation, to reduce—ideally eliminate, but, of course, at least reduce by every means possible—their flow on to our shores.

The context of this legislation also includes the fact that we are a maritime nation, of course. While it might truly have been said that no man is an island—or, perhaps, today we’d say no “person” is an island—New Zealand is, of course, a succession of islands and yet we’re not an island in the sense of being isolated. It is very much in an international context that we will be passing this legislation; if indeed it does proceed all the way through beyond the select committee to a second and third reading. It will be precisely for the reasons that the member Louisa Wall has outlined in relation to those international conventions that we will be making these changes.

I think it’s appropriate that the Minister of Defence has acknowledged the role that our Defence Force will be playing in implementing this legislation—effectively, doing things that they already do so well but with certain additional powers. It will be entirely appropriate for the select committee, which I’m very pleased and privileged to say I’m a member of, to examine exactly how it is that they will be able to carry these out in accordance with international law, again, as Minister Mark has said, and also in accordance with rules of engagement that do give them the tools that they require to do exactly that.

I acknowledge as well the other agencies involved—customs and police—and in doing so it is, of course, the customs Minister, Meka Whaitiri, who is bringing this bill to the House. I acknowledge her and her work and that of her department so far. No doubt we’ll work constructively with various advisers and, indeed, those who have drafted the bill at select committee along with those who will be making submissions in relation to seeing exactly what we can do by way of clarifying and strengthening the law so that it is fit for purpose.

Speaking then of the purposes, it’s been outlined already that the provision of the Customs Service with the opportunity to disrupt drug-smuggling will be important, as is the jurisdictional matter that has, again, already been touched upon in relation to clarifying the position of vessels that are not flagged, or maybe have different flagged or unflagged statuses, and are within and beyond our exclusive economic zone.

Briefly, on the subject of protecting our shores and, indeed, our people from the harm caused by illicit drugs, the bill is reasonably careful, it seems to me already—but, again, we can examine it to ensure that it remains as robust as it can and should be—to set out that there will be reasonable cause to suspect that a drug-smuggling offence has been committed or is likely to be committed, and it is that forward-looking opportunity, that ability, that rather hefty tool in the tool kit of our various agencies that will be very important. So, again, it’s exactly the parameters of that type of operation that will be significant to give to our respective services.

As well as the navy, I’ll also mention the air force, as has already previously been acknowledged. On a slightly parochial note, it’s no doubt various members of my electorate of Helensville, specifically the Whenuapai airbase and its residents, who will be conducting much of this good work. Also, on a parochial note, having had some background in the navy, I recall, perhaps on a light-hearted note, if I may, that we used to joke that the word “navy” was in fact an acronym for “never again volunteer yourself”, but I can assure you that the good men and women of the navy will be volunteering and happily carrying out their tasks to do such work as this because they know, as indeed we all know—I hope, indeed the whole country knows—how important this work is to support and to protect our people from the scourge of these drugs.

My final comment is just to note that setting out the purpose of the Act and referring specifically to those international conventions has a threefold purpose. One is that it makes the Act accessible in terms of showing exactly what it is that the Act is setting out to do. Second, in “related purposes”, that it will be an aid to interpretation so that we will see, hopefully, our lawmakers and those carrying out its provisions do so in accordance with the United Nations Convention on the Law of the Sea, for example. Finally, it will also signal to the rest of the world—again, going back to that point that New Zealand is not an island except in the geographical sense—that we are ratifying and taking seriously and implementing those international obligations.

So, with that, I join all members of the House, it seems so far, in commending the bill to the House and saying that I look forward to our work as a select committee in ensuring that it is fit for purpose.

DEPUTY SPEAKER: This next call is a split call and you’ll get a bell at one minute. I call Jan Tinetti.

JAN TINETTI (Labour): Thank you, Madam Deputy Speaker. Not being on the select committee where this bill is eventually heading to—and it sounds like it will eventually be heading there after tonight—I had to do a bit of research around this bill, more so than normal for me. So I thought what is this bill about? Is it just a little bill, the Maritime Powers Extension Bill? But then when I did my research I found that, actually, this is a really, really important bill that we’re putting through here tonight in its first reading, because, as we’ve heard here from every member that has spoken so far, we are a country that is in the midst of a drug epidemic.

Why I think it’s so important for me personally is that we’ve seen this—more so probably than in a lot of places—in the middle of Tauranga. Everywhere I go in Tauranga, one of the main issues that people talk to me about is the rise in the use of methamphetamine. People are really, really concerned about the access to the boats, the drugs coming in from the boats, and the spreading of that use of those particular drugs throughout the community. This was really brought home to us last year, in November, when there was a $20 million cocaine seizure. That was horrific for our community, to actually hear that that was so close to being distributed throughout our community, and had that happened it would’ve caused significant destruction within our community.

We need to see, and we are seeing, a commitment from all sides of the House here to attack this issue from multiple angles, and that’s what’s so exciting: to see that people are on board with actually attacking this. The powers contained in this bill will make it harder to get illicit drugs into New Zealand. We need to do whatever we can to protect vulnerable people who use the drug. So it’s about not just stopping the illicit drugs getting in but also protecting those vulnerable people, and on that I will commend this bill to the House.

TIM VAN DE MOLEN (National—Waikato): Thank you, Madam Deputy Speaker. All right, now—I’m looking forward to this call, of course—we’ve seen that a number of the aspects that are relevant to this bill have already been traversed tonight, some in shorter calls than others, but tonight I just wanted to touch on a few of those aspects. Really, what we’re looking at here is trying to provide greater flexibility to our fantastic men and women in customs to carry out the duties required of them in their roles—in particular, protecting our borders from the transition of a broad array of illicit drugs coming in or going out of New Zealand. This is a scourge on our society, and we’ve heard about that already somewhat this evening, but I just wanted to expand a little on that.

We’ve already got a vast array of laws under the Acts we’ve heard about tonight, covering those obligations or options that customs can deploy, at their disposal, as necessary, within our territorial waters or in the contiguous zone further out—again, another 12 nautical miles past those territorial waters. This bill is about expanding that and providing that flexibility to go beyond that, as necessary, to ensure that we can carry out those functions for any situation that is impacting on us in New Zealand, or has the ability to take these drugs offshore and provide further detrimental impacts in other nations. So I think it’s really important that we do extend this to give that flexibility, because otherwise what we can see—and at the moment we’ve seen—is a vast array of diverse manners in which drug traffickers are able to bring their products into New Zealand, or, indeed, look to take them out. So this provides that capacity to reach a little bit further, to capture them, perhaps, in staging areas outside zones that we’re not currently able to reach into.

I’d just like to take a moment to acknowledge the great work of the New Zealand Defence Force—primarily the navy and, indeed, also the air force—in supporting customs through this role. They do some fantastic work, and work that’s nearly as good as the army! I have to put that plug in, of course, with some background in the army myself.

So, look, the drugs are the issue here. It’s about getting tough on crime, and that’s a stance that, in the National Party, we have long supported. We’ve seen, over a number of years now, and not just in New Zealand but internationally, an increase in the volume of drugs coming into different jurisdictions, and an increase in the ingenuity, perhaps, of members of the illegal drug trade looking to bring their product in with different innovative approaches—and we’ve already heard some of those tonight, during the debate, with the hauls that have been intercepted. So this is about trying to adapt, to evolve, and to ensure that we remain able to best respond to this ongoing threat to our society—and, indeed, it is a significant impact on our society. You can look all around the country and, unfortunately, see the negative impact of drugs in our communities. I think every member here who represents an electorate would be able to agree with that and point to instances in their areas. Certainly in the Waikato we are not exempt, either, despite some of our areas being some of the most inland in New Zealand.

That aside, what we’re looking at, just to recap here, is providing the additional discretion to operate outside current jurisdictional boundaries and to respond in an appropriate manner. Now, this is quite succinct, around seizure options, boarding vessels, to ensure that, actually, there is some restriction to what we’re proposing when we’re operating outside our boundaries, because that is important to give context and confidence internationally that we’re operating in accordance with international law in this regard.

I think that’s probably about enough on those aspects, but I just want to recap that we are here, really, trying to evolve and to adapt, to ensure that we can continue to provide the best options to our team and to customs to carry out their great work. And I’d just like to finish on a wee trivia point if I may: customs was actually the first Government department in New Zealand, set up in 1840, actually—around the time of the Treaty signing, I believe. So it was really interesting to see that as the first department. Here we are now, continuing to evolve, continuing to ensure their relevance and their ability to conduct their duties in a professional and succinct manner. So I commend this bill.

GOLRIZ GHAHRAMAN (Green): Thank you, Madam Deputy Speaker. It’s a pleasure to get bills come through the Foreign Affairs, Defence and Trade Committee and connect this Parliament to international law in that way, so I do look forward to hearing submissions on this bill. As others have said, this is a law that proposes to bring our domestic law and the powers that we have for monitoring this area in line with two UN conventions: article 108 of the UN Convention on the Law of the Sea, and article 17 of the UN Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances.

It is a technical bill, and it will amend the Customs and Excise Act and the Misuse of Drugs Act in a way that just extends the jurisdictional area of those two Acts. One of the things that was important for me to look into was that we weren’t, in fact, substantively extending the powers to search. So I was pleased to see that the bill only proposes to extend the powers in terms of the geographic area and customs are still required to show a reasonable belief that one of the offences under their ordinary powers has been committed.

So in terms of search and seizure law, when that reasonableness standard is applied it means that there is an objective standard, where customs, just like New Zealand Police, would have to meet an objective evidential standard if they were tested, and the “belief” rather than “suspect”—all these words, very technical, but they do mean a lot in terms of the power to search. So I was concerned that we weren’t allowing a broad power to just board vessels and search them based on, sort of, a hunch. But we are still upholding the rule of law in terms of search and seizure law at sea; we’re just extending the geographic area, which is something that we have agreed to do in terms of doing our fair share to monitor an area of the sea in our neighbourhood—essentially, in our Pacific neighbourhood—based on our agreement in assenting to those UN conventions.

As others have said, this is something that will protect our Pacific neighbours who are being used, at the moment, as sort of transiting points for the dealing of drugs at sea and importation of some seriously expensive narcotic drugs, as we’ve heard over and over again. So this is something that we know: if drug trafficking is happening in a country, it will give rise to other types of criminal activity as well, and our Pacific neighbours are vulnerable to that.

Working on the defence portfolio, I learn every day that a lot of the work of the New Zealand Defence Force is done in monitoring in the Pacific for things like fishing and environmental offences. So that’s something that New Zealand is really active in, and this is extending that role for customs, which is important because we have those resources here, and we’re going to be cooperating more with our Pacific neighbours and also with our Australian counterparts to keep the area safe.

So we have heard over and over again that drugs cost New Zealand an estimated $1.8 billion in social harm annually. So it is important that we make sure that drugs aren’t imported regularly into New Zealand and into the Pacific. It is something that we do need to invest in, but it is only part of a more nuanced approach, as we know this Government has to all criminal offending but especially to drug offending.

We know from recent reports that came out in the annual reviews that the class A controlled drug methamphetamine is about to, this year, overtake its prevalence in our criminal justice system—it’s about to overtake cannabis. We’re not just talking about possession of small amounts; the kind of methamphetamine offending that’s coming up as being so prevalent as to take over cannabis is the supply, manufacture, and importation offending. This is a type of offending that has life imprisonment as its maximum penalty, and, regularly, we are sentencing people to imprisonment of up to 20 years, 18 years—and that is enormously costly. Drugs, once they’re imported into New Zealand, of course, then draw in all sorts of other counterparts to the offending that kind of disseminates drugs throughout the community, and our criminal justice system bears the brunt of that.

It’s costly in terms of policing. It’s costly in terms of the court system, which affects access to justice for victims of other types of offending. It is, in fact, one of the only criminal offences outside of homicide that our High Court hears any more. Everything else has been relegated down to the very busy District Courts because class A drug offending is now so prevalent. And it is costly in human terms. It’s costly to our communities. It’s costly to victims of addiction. It’s one of those types of offences that have as their victims the actual user as well. So we know that this is happening, and this monitoring of our seas is part of the way that we’re going to keep our communities safe but also our Pacific neighbourhood.

But beyond that, I do want to highlight that this isn’t the only kind of remedy that this Government will be looking to. We’re not only going to be policing the seas, and we’re not only going to be policing even within New Zealand. What we are going to focus on is addressing the causes of drug offending, which, actually, is the demand point. So we are going to invest in drug and alcohol addiction services and mental health services. We know drug addiction is often caused by more serious mental health concerns—anywhere from anxiety to behavioural disorders to mental illness to brain injury, that cause people to become addicted—and we’re going to invest in addressing those causes of this type of offending as well as creating jobs and housing and all of those things that keep our communities connected enough that they don’t fall prey to drug offending.

As we do all of that, we are also committing to passing this rather technical bill that does that little bit which is actually incredibly important in terms of monitoring and controlling the transport and the dealing of drugs internationally. It is part of what we’ve signed up to do. It is doing our fair share, so I am very pleased to commend this bill to the House.

NICOLA WILLIS (National): I rise to speak on the Maritime Powers Extension Bill at this, its first reading, with National in support. Before I speak on this bill, I do want to acknowledge our new colleague Dan Bidois, who gave a wonderful maiden statement this afternoon, and it has been a pleasure to be able to celebrate his entry into the House—and, in fact, to have Minister Ron Mark, as well, comment on the contribution he will make.

I, in speaking about this bill, also want to acknowledge former National Party Ministers—in particular, Tim Macindoe and Nicky Wagner—who had a hand in bringing this legislation to life. It is a sign of the goodwill of this House that we do have a tradition of this sort of legislation shifting from one Government to the other where it is to the benefit of New Zealand. If only Labour could see fit to do that with a few more bills which New Zealand could benefit from.

Now, what this bill does, of course, is empower the good people of the New Zealand Customs Service. It is very important that, where we have people who we are putting into enforcement roles on behalf of New Zealand, we ensure they have clarity over the powers they have, the jurisdiction in which they can use them, and the circumstances under which those powers are lawful. There is nothing worse than being someone in possession of powers that are vague or ambiguous, because this means that expectations are unclear and people aren’t sure about what actions they can take. In this instance, the bill makes powers explicit, giving additional options to disrupt drug-smuggling, and establishing clear jurisdiction over offences under the Misuse of Drugs Act 1975.

It goes without saying, and has been acknowledged by previous speakers, that drugs are a global issue. They’re not an issue that New Zealand can overcome by acting alone; we have to act in cooperation with other nations. It’s here that we see, in this bill, a very good working example of New Zealand being a member of a rules-based international order in which we seek to cooperate with other countries, through international conventions, to ensure that rules that are to the benefit of people across the world can be enforced.

In reflecting on that, it’s appropriate that we have come from a GLOBE-NZ conversation this afternoon, where we have had members of the House, across the Parliament, talking about how the international rules-based order applies when it comes to climate change legislation. Here we can see that, in New Zealand, we are giving effect to our rights and obligations under article 108 of the UN Convention on the Law of the Sea. Of course, that these conventions are in place and that we, as a good State actor, adopt them shows, I think, the relevance of the UN continuing throughout the world. Similarly, it allows for the adoption of article 17 of the UN Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances—the drug-trafficking Act.

Now, of course, the reason this is necessary is that we have a difficult context, and it is good to hear the acknowledgment by the Greens speaking just now that drugs, illicit drugs, do considerable harm in our community. It is therefore to the dismay of us all, I am sure, that the number of attempts to smuggle drugs into New Zealand and past our maritime border have increased significantly in recent times. We know that behind these efforts are transnational criminal groups, and, of course, they are becoming increasingly sophisticated in their efforts to bring illicit substances into New Zealand. It’s therefore appropriate that we update our law to ensure that, just as those criminal groups become more sophisticated, our enforcement agencies have clear and unambiguous jurisdiction with which to go against them.

So, with this bill, the customs agency has an enhanced tool kit that will allow them to fight against those international drug traders. The clear framework is really explicit about how customs can stop and in what circumstances, how they can board vessels and under what circumstances, and how they can search those vessels and then what enforcement actions they can take. And, of course, it’s very important that those are set out in law so that there aren’t questions after the fact about whether or not actions have been appropriate or not. The rules apply in both New Zealand’s territorial waters and in our contiguous zone. Of course, they allow for reasonable cause to be established, and flag States have to have authorised the implementation of these laws.

In a sense, we could say that this piece of legislation allows for more preventative action by the New Zealand customs agency, and that is because it allows our customs agents to respond before a ship has entered New Zealand’s territorial waters. That’s significant because having that made explicit means that customs can make better operational decisions about when enforcement action would best occur and most efficiently occur. Of course, the bill also allows for enforcement action to be taken after a vessel leaves New Zealand’s waters, and, again, this is significant because, in some instances, evidence may only come to bear or become clear after a ship has left New Zealand’s waters and after smuggling activity has occurred.

So, ladies and gentlemen, we are in agreement across the House today, I think, that illicit drugs do considerable harm in our community. We want to reduce the amount of illicit drugs coming on to our shores. This bill empowers the good men and women of the Customs Service to take better enforcement action and makes New Zealand, once again, a good actor within the international rules-based order, and we commend this bill to the House.

Dr DUNCAN WEBB (Labour—Christchurch Central): Thank you, Madam Deputy Speaker. It gives me great pleasure to be the last speaker in this first reading. I don’t want to go too much into the detail of the bill, but I do want to touch on the matter of—

Hon Members: Oh, do it. Come on!

Dr DUNCAN WEBB: —I expected that kind of response. I want to talk about the principle underlying this bill, because it’s a very important one. It’s really a principle about freedom of navigation on the high seas. What this bill does is it, essentially, curtails freedom of navigation. It says, “Yes, everyone has freedom of navigation on the high seas, except in certain instances.” I want to sound a word of caution, because freedom of navigation has been a pretty fundamental element of international law since it was first propounded by Hugo Grotius in 1609. The idea that trading nations can freely ply the seas is absolutely pivotal. What we have here is a recognition that trafficking in drugs, along with some other serious maritime offences, is an incursion into that.

The bill, as we’ve heard Minister Mark explain, has some constraints—the fact that a flag State must give consent for a vessel to be boarded—but, nevertheless, what we have is an extension of sovereignty of one State on to the high seas. I’m sure that, when this matter comes before the courts, as it inevitably will, that will be viewed with caution, that any extension of a power to encroach on this freedom of the high seas will be restrictively interpreted.

This is the interface between both the United Nations Convention on the Law of the Sea and the United Nations Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances. It’s recognised in the UN convention that, firstly, there is freedom on the high seas, but that that is for peaceful purposes—it is for navigation, for trade—and that no State can exercise sovereignty on the high seas. However, that convention itself recognises that there are limits on that, in terms of piracy and also in terms of narcotics.

So, really, all I want to do in this final contribution on this bill is to say that this is an important piece of legislation. We do absolutely want to confer these powers on our customs officers, in cooperation with other States, but let us also recognise the very high value of these ancient principles of navigation. On that basis, I commend this bill to the House.

Bill read a first time.

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

Bills

Military Justice Legislation Amendment Bill

Second Reading

Debate resumed from 28 June.

DEPUTY SPEAKER: When the House was considering the Military Justice Legislation Amendment Bill last time, Chris Penk had the call. He has nine minutes and 45 seconds remaining to speak.

CHRIS PENK (National—Helensville): I look forward to resuming my contribution on the Military Justice Legislation Amendment Bill. I might take the liberty, effectively, of starting over, only having had a 15 second run-up initially—15 seconds of fame, I understand, just to tweak that slightly, is accorded to us all, but I’m going to be greedy and take just a little more to discuss this piece of legislation.

It amends, of course, the Armed Forces Discipline Act—as those who were watching with great intent and interest, no doubt, last week will recall—and also the Court Martial Act and the Court Martial Appeals Act. Before proceeding any further, I’d like to acknowledge the good women and men of the New Zealand Defence Force. They are, of course, the “Military” in the title—the Military Justice Legislation Amendment Bill—and I think it’s worth noting that the matters contained in this bill and referred to are somewhat exceptional. They’re exceptional in that the rule of the operation of the Defence Force and its fine people is, of course, very much law abiding, so these are circumstances in which we are deciding how conduct is to be regulated and determined when things are outside those bounds and an exception occurs. So that’s something I just wanted to place on the record, lest anyone listening to the debate were to gain an impression that these are more regular matters than in fact they are.

I acknowledge both Ministers involved in the passage of this bill, by which I mean the present Minister but also his predecessor, on our side of the House, at the time that we were in Government and this legislation was first contemplated. I acknowledge too the Foreign Affairs, Defence and Trade Committee, those who had been drafting the bill, and also those who have submitted on it.

There are three things I’d like to touch on briefly in the remainder of my contribution, and they relate to the things that I believe this bill does achieve pretty well. The first is that it aligns, the second is that it updates, and the third is that it strengthens. Taking each of those briefly in turn—the first is “aligns”. This bill aligns the military and the civil law, at least to some extent. The key aspect of this is that it sets out in a way that is similar—in fact, in certain respects identical—to the civilian, that is non-military, law, how we are to regard the burden of proof in a trial.

The burden of proof here relates both to the onus and the standard of proof, such that whereas currently the Armed Forces Discipline Act provides that the onus is on the accused to prove, on the balance of probabilities, any excuse, etc.—any exculpatory consideration, I believe, might be the phrase, and any Queen’s Counsel in the area will no doubt correct me if I’m wrong on that. But that onus is different in the sense that it’s not for the accused to prove that thing, but indeed for the innocent to be presumed guilty, so that will change, and also the standard of proof will be going towards “beyond reasonable doubt” as opposed to “the balance of probabilities”, which is the more normal civil standard, to use the word “civil” in a different context. So that’s a valuable thing to me, it seems, in that this bill aligns the military and the civilian justice systems.

The second thing that it does is that it “updates”. Here I refer to the fact that, actually, not the bill so much as the report back from the select committee allows an update whereby this bill will be subject to a Supplementary Order Paper to bring it into line with the general legislation that will come before the House, the Courts Matters Bill. Just by way of explanation, the select committee that was considering this bill did not know what exactly the Courts Matters Bill would look like when that came back to the House, and yet the committee, desiring that those two things would be aligned, contemplated that a Supplementary Order Paper might go in, and ensure that once the Courts Matters Bill has progressed through, that this one could be amended, effectively, to ensure that it is along similar lines. So that’s the background for that one, and that particular change that I’ve referred to will go to the question of a mentally impaired person, as defined in other legislation—whether they are fit to stand trial, that being the first thing to determine, and then to see whether they’ve in fact committed the offence, as opposed to the other way around, which is presently the case.

The third and final thing is that this bill “strengthens”. I refer to victims’ rights, which are strengthened in the case of the information that’s to be provided to them on their request. That’s set out in new section 155A, inserted into the Armed Forces Discipline Act 1971 by clause 10, a new provision that will be included in this bill; certainly, at this stage, the legislation is looking like that will be so. That’s something that we as a party support—indeed, we supported it, each of our members on the select committee.

I’ll finish by saying that the process of getting to this stage has been collegial and constructive—no doubt that will continue—and so it’s with no hesitation that I commend this bill to the House to proceed to the next stage.

GOLRIZ GHAHRAMAN (Green): Thank you, Madam Deputy Speaker. Again, it was a pleasure to sit on the Foreign Affairs, Defence and Trade Committee while we heard submissions or advice on this bill, and the lawyers among us took some pleasure in questioning the experts on some of the finer points. This, essentially, is a bill that brings the military justice system in line with the civilian justice system, and that’s important because one of the central tenets of the rule of law is that the law is clear and knowable before it applies to anyone. In this case, the discrepancies between the procedural safeguards, the standards for fitness to stand, and even victims’ rights were not in alignment and therefore, I would argue, not really knowable to those who they apply to. And that kind of discrepancy really kind of undermines the rule of law across those jurisdictions.

I would like to start by talking about the victims’ rights issues. This bill brings the military justice system in line with the 2002 Victims’ Rights Act—that’s been in application in the criminal justice system at large for some time now. Victims of certain serious sexual and violent offending have had the right to be informed about not only the application of bail but also breaches of bail, release, and escape of offenders that have offended against them in the civilian justice system; whereas in the military justice system, victims of those same types of serious offences have only had the right to be advised and to give their input on bail being granted. So, to look at that and think about it carefully, even if an offender escaped custody, victims in the military justice system were not advised. They were not advised of bail breaches, whilst they’d be consulted on whether or not bail is granted. And they’re not advised when the offender is released.

So those types of offending, when you think about the power and control dynamics and when you think about how traumatic these offences are to a victim and their whānau—when you think about that and realise that, actually, by leaving them in the dark about the release or escape or bail breaches by those offenders, we’re actually re-traumatising those victims. To find out later—to find out through seeing the offender—whether the bail breach is actually against the victim the next time it happens. It’s enormously traumatising for victims not to know and not to be involved in that process, at least by being notified. So the military justice system, thankfully, is now coming into line with what we’ve known is necessary for victims to have access to justice in the civilian system in those ways.

Next is the procedural safeguards, and I was somewhat aghast to find that the onus of proof is reversed in the military justice system, so that if charged with an offence, an accused person in the military system has to prove their innocence to a balance of probability standard; whereas in a civilian system, as we all know, the prosecution bears the onus of proof—they have to prove the charges beyond a reasonable doubt. That exists because, of course, every accused person is considered innocent until proven guilty so that fairness prevails in a criminal trial before we can sanction someone. And, I mean, it is considered incredibly serious to be convicted of any crime in any jurisdiction and to be sanctioned—for an accused person’s whole life to be affected, whether it’s through their career or through imprisonment. Where they’ve not had the benefit of presumption of innocence, it goes against, again, another central tenet of our criminal justice system. So, gladly, this bill will bring that procedural safeguard to protect those accused of criminal offending in the military justice system.

Lastly, the other important standard that’s being adopted in this bill, through the civilian system, is the standard of requiring two expert psychiatric reports before someone is, essentially, declared or considered unfit to stand trial. In the criminal context, “unfit to stand trial” means that someone has proven that they suffer from a disease of the mind that renders them unable to know the nature and quality of their actions. So it’s a very high standard, and this will require the same procedural framework as in the civilian system, where we have two psychiatric reports before that’s proven. And that, again, is something that’s important for consistency and sort of clarity of our law where someone’s being sanctioned or, indeed, being excluded from ordinary criminal sanction.

So I am very happy today to commend this bill to the House, because I was so shocked at the complete lack of consistency between these two criminal justice systems for, essentially, no clear reason. But our law is, after the passing of this bill, going to be far more consistent and logical across those two jurisdictions, so I’m glad to commend this bill to the House.

TIM VAN DE MOLEN (National—Waikato): Thank you, Madam Assistant Speaker. So, look, it’s a privilege to take a call on the second reading, now, of this Military Justice Legislation Amendment Bill, following on from the call I took in the first reading. It’s great to have seen this progress and the recommendations we have received off the back of that. Fundamentally, we’re talking about alignment—looking to align more closely the military justice system with the New Zealand civilian criminal justice system.

There’s a number of aspects in this that have already been touched on tonight that are in need of an update because there has been disparity between these two different justice systems. I would like to acknowledge, of course, that there are some unique aspects of the military justice system that are not applicable in a civilian setting. One quick example that springs to mind is “UAD”, as it’s called in the army—an unauthorised discharge—where a weapon is inadvertently discharged during the course of any operations or training without the intent to have done so. Now, of course, that ranges on a spectrum, and within that, this would not, necessarily, be one of the most serious offences but is an example of something that is specifically unique to a military environment. And, of course, there are numerous examples of how that can happen, whether it is inadvertent, through an inability to conduct the correct drills with your weapon system, or through, perhaps, a miscarriage of that weapon system throughout the training procedures you’re in. These things can happen from time to time, and that is an appropriate element that needs to be captured in the military justice setting but, of course, is not applicable to the civilian or mainstream criminal justice setting.

Now, before I carry on, I would also like to acknowledge the fine members of the New Zealand Defence Force: those men and women who, every day, put on their uniform and perform their duties to the best of their ability on behalf of our country. I’d also like to echo the comments made by Chris Penk, highlighting that, whilst we’re talking here tonight about amendments to this military justice legislation, it by no means suggests or indicates there is a high level of use for this particular piece of legislation. Indeed, it captures those very few scenarios that we have to have an appropriate set of laws in place for, but, by and large, the conduct within our defence forces is exemplary, and so I’d like to commend them on that as well as their service.

There are a couple of key aspects that I want to highlight in particular, and one is the victim’s rights. And we’ve heard extensively about that from the previous speaker, Golriz Ghahraman, from the Green Party. That’s a really important aspect and we need to make these updates to bring these into line with civilian law and provide better support for those victims or confidence around knowledge or information, in particular. One of the reasons I think that is of particular importance is that any victim needs to be supported, of course, but in this system, typically, victims—and I’m a very passionate supporter of the defence forces, and anyone who has committed to being a part of that, I believe, is going above and beyond in their service, whether they get offshore or not, and should indeed be extended additional victims’ rights to ensure that they are being supported in every manner possible, given what they have done or offered to do for their country. So it’s great to see some improvements being made in that space. Onus of proof, as well, of course: an important change here to make sure that we are bringing that into line. Changing that onus of proof from the defence to the prosecution is an important and relevant change to make across these pieces of legislation, as well.

Another aspect I do want to touch on, which hasn’t been widely traversed tonight, is fitness to stand trial, and that, for me, is one particular area that we, I think, are still learning a lot more about. When you look at some of the mental wellness issues that have presented over time in military settings, and in any manner of settings as well, it’s important to note that we have perhaps not had an appropriate or advanced understanding of those issues to the level that we might desire or have now, if we were to reflect on some of those decisions made previously. So this is a great way to acknowledge that we do need to take greater account of those particular impacts that are not necessarily visible on the victims or the perpetrators of these crimes as well. So that’s one area I’d just like to finish on, and I commend this bill. Thank you.

ASSISTANT SPEAKER (Poto Williams): I understand this is a split call. Dr Liz Craig—five minutes.

Dr LIZ CRAIG (Labour): Thank you, Madam Assistant Speaker. It’s a pleasure to take a call on this bill. While it’s actually quite a non-controversial bill, I think it’s really, really important in terms of what it does for those serving in the armed forces. What it does is it makes sure that the victims of serious offences of a sexual or violent nature get the same rights as they would in the civilian justice system, and that’s absolutely crucial because I think experiencing these things as a victim is the same wherever you are in terms of your workplace.

One of the rights—the right to be consulted on the accused’s release from bail—is actually in the military justice system already, but there’s a whole lot of other things that we’ve talked about tonight that actually aren’t. So what this bill does is it adds a whole new lot of things and rights for victims, and it adds a new section to the Armed Forces Discipline Act 1971. While the onus is still on the Director of Military Prosecutions to consult the victim when they’re talking about whether the offender should be released on bail, it adds a whole lot of other things in terms of informing those victims and keeping them in touch with what’s happening with the process.

Some of the important ones are actually informing the victim if the accused or the offender is indeed released on bail, because I think that has a whole lot of safety and security issues for those victims, and, if they are released, informing the victim if there’s any conditions about the release that are to do with the safety of them or their family, and, in particular, things like any conditions about the accused not actually contacting them or members of their family. Also, if the offender does breach these conditions, making sure that the victim is aware of that, plus also if the accused escapes or the offender dies in custody—being aware of those things is crucially important.

What research suggests is that if you are a victim of a violent crime, then you experience further trauma if you’re not kept fully informed and up to date with what’s happening and taken through the process about what’s happening now and why. But, in contrast, if you are informed, if your views are taken into account, and if you’re consulted, it can have significant therapeutic effects for the victim and it can also help with their recovery. I think it’s also got other spillover effects, because if other people who are thinking about potentially stepping forward with their own experiences see other victims having good experiences in terms of being kept up to date and knowing what’s going on, they may be more likely to actually step up themselves and engage in a process. I think some of this is the culture change. When the National Council of Women submitted in support of this bill, they were thinking about some of those effects in terms of what’s happening in our military system at the moment.

So, just to sum up, I think ensuring the victims of serious crimes receive the same rights in the military courts as they do in the civilian courts is really, really crucial because it will ensure better outcomes for the victims in our armed forces. So I, therefore, commend this bill to the House.

MATT KING (National—Northland): It’s a real pleasure to speak on the Military Justice Legislation Amendment Bill in its second reading. First of all, I’d like to acknowledge and welcome to the “class of 2017” our newest MP, Dan Bidois, who made an exceptional maiden statement a couple of hours ago. I think he’s going to be a great MP.

I’d like to acknowledge the Hon Mark Mitchell for bringing this bill to the House, and I’d like to acknowledge the Hon Ron Mark for taking it through the House. It’s an omnibus bill. The purpose of this bill is to update the military justice system and to align it with the criminal justice system in certain respects, including enhancing victims’ rights. It amends the Armed Forces Discipline Act 1971, the Court Martial Act 2007, and the Court Martial Appeals Act 1953.

I’ve got a bit of experience with the criminal justice system—

Hon Kris Faafoi: How long have you got? You’ve only got 10 minutes.

MATT KING: Remember that interjections are meant to be witty—that’s what the Speaker said. I am particularly interested in victims’ rights, based on my time as a police detective. I felt that the victim had no rights and that everything was weighted towards the offender. I can recall many times while I was taking a serious sexual offence case through the court process, it felt like it was myself and the poor victim against the rest. So I’m really interested in anything that progresses victims’ rights. Many times I felt that it was wrong and many times I felt like chucking it in. Eventually, that’s why I left the police. I felt a little burnt out, and I felt someone else could pick up the load. Thankfully, times are changing and good law is being made to address these issues.

Part 3 of the Victim’s Rights Act 2002 confers rights on the victims of certain serious offences of a sexual nature or that involve violence: the right to be kept informed, to be consulted, and, most importantly, to have their views taken into account in respect of decisions around bail. So this legislation seeks to align victims’ rights and protections in the military justice system with those in the criminal justice system.

This bill also amends some aspects of the procedures of the Court Martial of New Zealand. This bill aligns provisions governing whether an accused is unfit to stand in the military justice system and steps associated with that determination with the provisions of the Criminal Procedures (Mentally Impaired Persons) Act 2003.

It cleans up some procedural issues relating to courts martial. A key improvement, in my view, is the change to the onus of proof. I understand that, under the Armed Forces Discipline Act, the onus is on the accused to prove, on the balance of probabilities, any excuse, exception, exemption, or qualification that the accused relies on as a defence to a charge. Provisions placing the onus of proof on the accused have largely been removed from the criminal justice system following the decision of the Supreme Court in R v Hansen in 2007. There is no good reason for members of the armed forces who are tried under the military justice system to have an onus of proof imposed on them that is not imposed in the criminal justice system. Accordingly, the bill repeals section 3(2) of the Armed Forces Discipline Act 1971.

This, along with the improvements to victims’ rights, in my view, are the most important changes in this bill. Accordingly, I commend this bill to the House.

ASSISTANT SPEAKER (Poto Williams): Before I call the next member, I just want to encourage members who have been in the House for several months now that it’s the expectation that members will not read speeches and that, when they are in the debating chamber, they will actually deliver arguments from notes only. So this is the last time I’m going to mention it. Next time, I will be stopping members from reading speeches, except for our newest member, who arrived in the House today.

LOUISA WALL (Labour—Manurewa): Tēnā koe e Te Māngai o Te Whare. Tēnā koutou katoa. It’s my pleasure to speak on this, the second reading of the Military Justice Legislation Amendment Bill, as a member of the Foreign Affairs, Defence and Trade Committee.

I just want to highlight one aspect of this bill, actually, and it’s the matter of principle that this Government believes that the military justice system should grant to our armed forces personnel the same rights enjoyed by civilians in the criminal justice system. So, in wondering why we would state that, which is the intention of this piece of legislation, I found some international research, and it is by Arne Willy Dahl from the University of Oslo. It was published in 2011, and it’s called International trends in Military Justice.

The interesting thing in all of this actually stems from a European Court of Human Rights case called Findlay v the United Kingdom, dated 25 February 1997. Essentially, it was a challenge to the independence and impartiality of the court martial system, and a challenge to the UK Army Act of 1955. In this particular case—and I think we all should know where the history of philosophies come from and changes come from. But in this case, the governing officer who played a central role actually decided what the charges were. He convened the court martial. He appointed the members and the prosecuting and defending officers. All military personnel were subordinate to his rank as convening officer. And so this whole human rights case in the European Court of Human Rights was about conflicts of interest, power, and the military actually having a system that did not uphold this individual’s rights as a civilian. So if he’d gone through a civilian court—obviously, we’d take care of conflicts of interest. We make sure that people are adequately represented. There’s fairness and justice in the system.

And so the reason I highlight that is because it seems that all the changes in the military justice system aligning the military justice system—and it actually has gone through several iterations. From courts martial convened for individual cases, standing military courts, specialised civilian courts, general civilian courts in peacetime, to now, which is kind of like this intersection between a stand-alone military and our—what I would call a normal and ordinary court system, but the coming together of those to uphold these principles, which is that people deserve the right to be heard, to be represented in a fair and just way. But also, central to everything we do now is putting victims at the centre of a criminal justice system where we’re innocent until we’re proven guilty.

And so this piece of legislation that has gone through the Foreign Affairs, Defence and Trade Committee actually made no recommendations, but with a caveat that there does have to be a cross-reference between our legislation and the Courts Matters Bill that is going through this Parliament at the same time, so there may be a Supplementary Order Paper introduced by the Minister at committee stage. We’re fully aware of it as a committee. So I won’t speak any longer, other than to commend the bill to the House. Kia ora.

HARETE HIPANGO (National—Whanganui): Thank you. Look, I stand to attention to take this call on the second reading, and I’m grateful that I’m able to address the House again—because I did in the first reading—on this Military Justice Legislation Amendment Bill. I’m grateful because of the fact that I do have a connection, personally and professionally, in speaking to this legislation: professionally, having practised law, and this is a piece of legislation, proposed law, soon to be passed—I am confident that it will be—where there is a better alignment of the military justice system with, as my friend across the House there, Ms Louisa Wall, mentioned, a “normal” court or a “usual” court; I would say that it’s our criminal justice system. So it’s an alignment, and the purpose of this legislation is around aligning, updating, and enhancing.

The other personal connection that I have is very much, as I’ve indicated and shared with the House before, my military background. My family has given military service since the 1850s through to date; so this is quite personal, but it’s also professional in being able to address the House and members of the public in this reformation—reshaping—of the military justice legislative system.

Being the last speaker, most of the significant messages have been conveyed to the House and the public, and my time is limited. I’d be grateful, Madam Assistant Speaker, for you to keep a check on my time, because I’ve just lost it on my phone.

ASSISTANT SPEAKER (Poto Williams): You can be assured I will. You have eight minutes and 22 seconds left.

HARETE HIPANGO: Thank you. I’m taking a brief call on this, but the three key areas that I would wish to address the House on are really along the lines of the areas that I have practised in. One is around victims’ rights, and this legislation is certainly acknowledging and enhancing victims’ rights under the bill—the Act to be. It’s also, as we’ve heard, around repealing a provision in the Armed Forces Discipline Act that has placed the onus of proof on the accused. Now, this is reshaping and aligning it with our criminal justice system so that the onus of proof is on the prosecution and no longer will it be just on the “balance of probabilities”; it will be “beyond a reasonable doubt”. That’s so significant and important.

So victims’ rights there have been addressed in detail, and that is covered specifically in the bill itself, in new Part 10A, in clause 19, outlining, for example, victims’ rights; having views about release on bail of the accused or the offender. As a criminal lawyer for many years—also a family lawyer, actually—representing many women and sometimes men who were victims of domestic violence, they are entitled to be enlightened about what is happening in terms of the offender and the conditions that they may be released on bail under. New Part 10A of the bill, soon to be Act, addresses that in detail.

The other part that I do wish also to speak to—and I mentioned it in the first address to the House—is the provision of fitness to stand trial. So the bill is aligning where an accused is deemed to be unfit to stand trial—and noting also that, under the Courts Matters Bill, it is seeking to amend the Criminal Procedure (Mentally Impaired Persons) Act, where I’ve represented, and there’s been the fact that a hearing had to take place to establish whether a person was unfit or otherwise before it was deemed that the act had been committed or omitted. So this is very much aligning, and with an amendment to the bill before the Justice Committee, I believe, there will be a reversal of the sequence. So it will be very much about first determining whether the person who has a mental impairment is fit to stand trial, then determining whether the defendant was actually involved in the commission or the omission of the offence.

I have been instructed to take a brief call on this. The details are there within the bill. I have spoken and addressed those particular provisions that I’ve practised in law, and it’s significant now that the military justice system be aligned and in accord with what everybody else is entitled to, in terms of our criminal justice system. I commend this bill to the third passage of the reading. Kia ora.

ANAHILA KANONGATA’A-SUISUIKI (Labour): Kia orana, e Te Māngai. It’s an absolute privilege to take the last call on the second reading of the Military Justice Legislation Amendment Bill.

We’ve been in the House now for a while, and we’ve heard members speak on how collegial it’s been and how we can all work together in this House. There is one thing that I’d like to bring to members’ attention, which is that the men and women—in fact, all genders—of the military, of the Defence Force, take the Oath of Allegiance just like we do, just like members of Parliament do, but the difference is that the men and women and all genders who are in the armed forces are there to lay their lives on the line to defend this nation we call Aotearoa New Zealand. So it is only fair that a justice system is provided to ensure that all behaviours conducted in the forces are fair and integral in terms of the men and women who have chosen to give their service, their lives if they have to, to defend this country. Like all the other members of this House, I want to acknowledge the honour that those members of our society have chosen to take on our behalf.

I believe that the amendments actually make sense, and I believe that these amendments are exactly about this: they are about justice and they are about fairness of behaviours expected of everybody that serves our country. I’m not a member of the Foreign Affairs, Defence and Trade Committee, but I am a person who subs into most committees.

I want to conclude by reading a caution from the National Council of Women of New Zealand, where they said that although they agree with the bill, they “have reservations about possible conflicts of interest …”, and if the select committee can take note of the last paragraph of the select committee evidence provided by the National Council of Women of New Zealand. Other than that, all members have actually covered most points, and I’d like to commend this bill to the House. Malo.

Bill read a second time.

Bills

Courts Matters Bill

Tribunals Powers and Procedures Legislation Bill

Second Readings

Hon AUPITO WILLIAM SIO (Associate Minister for Courts): I move, That the Courts Matters Bill and the Tribunals Powers and Procedures Legislation Bill be now read a second time.

At the outset, I want to thank my ministerial colleagues of the coalition Government and support partners for working constructively with me and my staff to ensure that the necessary policy changes were made to improve these bills and to approve the necessary funding that’s going to be required to implement the changes that this bill will entail.

I also want to acknowledge the efforts of the Justice Committee members in examining the bill. I want to thank the committee members for their hard work in ushering this particular bill through the select committee stage. The committee received 48 written submissions and heard 15 oral submissions. The submissions came from the judiciary, professional organisations, interested groups, and individuals. I want to thank those who took the time to present to the committee. I want to thank them for their energy and for sharing their experiences. I believe that, by sharing their experiences, they were able to add value to the final outcome, as presented to the House this evening.

People’s experiences with courts and tribunals shape their views of the integrity of our justice system. Some of the legislation governing the courts and tribunals system is outdated and does not meet public needs and expectations, and, therefore, it needs to be changed. These two bills contain relatively small but important changes to the courts’ and tribunals’ powers and processes.

The Tribunals Powers and Procedures Legislation Bill, which I will hereafter refer to as the “tribunals bill”, amends the powers and procedures of 21 tribunals which the Ministry of Justice administers. These tribunals include the disputes tribunal and the Tenancy Tribunal, which almost 30,000 New Zealanders accessed in the 2016-17 financial year. The tribunals bill will also disestablish the defunct Birdlings Flat Land Titles Commissioner, the rarely used Health Boards of Appeal, and the Maritime Appeal Authority. The District Court will hear any future cases of the latter two tribunals.

I will highlight some of the changes to the tribunals bill that the Justice Committee has recommended. I consider these will improve the bill’s effectiveness. One of the most significant changes being made through the tribunals bill is a result of the actions that this Government has taken to address the backlog of cases at the Human Rights Review Tribunal. The Human Rights Review Tribunal provides important services for people who may have had their human rights, rights to privacy, or health and disability services rights breached. Since 2015, the number of claims filed with the tribunal has exceeded its resources. A significant case backlog has developed over the past several years. Between the 2014-15 and 2016-17 financial years, the number of new cases received by the Human Rights Review Tribunal grew by 92 percent. This led the number of backlog cases to grow by 144 percent—from 52 cases, as it was at the end of 2014-15, to 127 cases at the end of 2016-17. As of 30 June 2018, there are currently 135 active cases before the tribunal.

Following advice from the Ministry of Justice, including that of submissions made by the public and, notably, by the chairperson of the Human Rights Review Tribunal, Rodger Haines QC, I took a paper to Cabinet to get agreement to amend the Human Rights Act 1993 to enable the appointment of deputy chairpersons to the Human Rights Review Tribunal. I want to thank the Minister of Justice, and also both New Zealand First and the Green Party, for working with me and my office to reach agreement quickly so that we can collectively work towards a solution that will address the backlog of these cases.

The Justice Committee has incorporated the Government’s proposal to reduce the case backlog at the Human Rights Review Tribunal. The tribunals bill now authorises the appointment of one or more deputy chairpersons to this tribunal instead of a second chairperson. The new deputy chairpersons will be able to perform the same functions as those of a chairperson. This will help to reduce the unacceptable backlog, because much of this tribunal’s work has to be undertaken by the chairperson and will provide people with greater access to justice. The tribunals bill will now also include procedural changes to help further reduce the Human Rights Review Tribunal backlog. For example, the chairperson or deputy chairperson will be able to decide minor matters on the papers instead of a hearing being held.

The reported-back bill has amended the procedures governing the awarding of compensation for financial losses arising from a real estate agent’s unsatisfactory conduct. This amendment will reduce duplication of effort. In addition, the bill now clarifies that compensation for financial losses caused by a real estate agent’s poor behaviour must be an order that a court could make. There are currently no constraints on the nature of the compensation that the Real Estate Agent Disciplinary tribunal can award.

The amended bill has also addressed other anomalies. For example, the bill has authorised the enforcement of fines, fee refunds, and compensation that the Legal Complaints Review Officer has ordered. It is currently unclear if these orders can be enforced. This bill has also removed the requirement for these orders to be enforced in the High Court if the amount is more than $12,000. In future, orders of up to $350,000 will be able to be enforced in the District Court. Enforcement in this court is simpler and cheaper.

The reported-back bill has authorised insurance companies to be represented at disputes tribunal hearings by agents as well as by employees or officers. This will achieve a better alignment with the way that insurance companies operate. Insurance companies are party to around one-third of disputes tribunal cases.

I will now turn to the amended Courts Matters Bill, and I will highlight some of the changes the Justice Committee has recommended to this bill. The Courts Matters Bill amends 15 Acts that govern court security, fines enforcement, and criminal and Family Court procedures. The reported-back bill makes further amendments to criminal court procedures. This bill is now amending the Courts (Remote Participation) Act to enable judges to allow any participant in a criminal procedure hearing to appear via audiovisual link technology, or “AVL” as it is commonly known, if AVL is available and it’s use is not contrary to the interests of justice. This will enable participants such as counsel witnesses to appear by AVL during criminal procedural hearings. Currently, defendants who are in custody must appear in criminal procedural hearings via AVL if it is available. AVL can be used in criminal sentencing hearings or in civil proceedings.

The committee has removed the amendments for the Court Matters Bill that authorise the Minister for Courts to extend the scope of the Courts Security Act to include further courts and tribunals through a Gazette notice. Instead, these decisions will continue to be made by regulations. I plan to progress regulations to extend the scope of the Act to include further tribunals that the Ministry of Justice administers.

The committee has recommended changes to the Care of Children Act to limit the release of psychological report writers’ material so that a party can only obtain information about themselves. The court will be able to impose any conditions concerning the release of the information it considers necessary. This will give judges greater powers around the release of this information. I note that the psychological report and any associated materials belong to the court. The committee has recommended this House consider further changes in the committee of the whole House to entirely prohibit the release of psychologists’ notes and other materials. The Minister of Justice is leading a review of the 2014 family justice system reforms. We’ve discussed this matter and are in agreement that this important issue is better dealt with in the review. This will enable consultation with the Family Court judiciary, the report writers, and the Law Society to ensure that changes made are the right ones. I commend this bill to the House.

CHRIS PENK (National—Helensville): Thank you, Madam Assistant Speaker. It’s a pleasure to begin the contribution on this side of the House in relation to the Courts Matters Bill and the Tribunals Powers and Procedures Legislation Bill, taken as a cognate debate, of course. I will say at the outset that my party supports the intent of this legislation—and, indeed, the legislation itself, I should clarify. Indeed, it was originally from our side of the House, or at least our party, when in Government, that this legislation was proposed, so I acknowledge Minister Adams, as she then was, but also the current Minister and his colleagues, who have seen the continuation of the legislation to this stage.

There are a number of different purposes of these bills, and I intend to step through those now rather than delve into the detail of each those two specific bills. No doubt my colleagues on this side of the House and, indeed, the other will get into that detail—

Rt Hon Winston Peters: This will be fascinating.

CHRIS PENK: It is a case very much that the devil is in the detail. I don’t know what brought that phrase to my mind when I looked up, but perhaps the interruptions coming opposite put the word “devil” into my mind.

There are, as I say, a number of different purposes of the bills, and I think perhaps, at a sort of a higher level, it would be appropriate to talk about those each individually and then see where we come to terms of time, whether we should get into, perhaps, the Courts Matters Bill at that stage.

The first thing is that the bills will reduce the time that it takes to hear and resolve matters. That’s an important aspect of our justice system, of course. It’s a well-known phrase, to the point of being a cliché or perhaps a truism, that justice delayed is justice denied.

Chris Bishop: That’s right—well said.

CHRIS PENK: That’s right. I think that the reasons for that are many, the first of which is actually a practical reason. It’s harder to determine the truth of a matter some time after an offence or a possible offence or an act or an omission in a civil context have actually taken place, so the sooner that matters are able to be heard by our courts and, indeed, our tribunals, the more likely it is that we will have a just outcome.

The second reason is that the players of the game, those involved, whether litigants—again, in a civil context or in a criminal context. For their sake, it’s important that these matters are heard quickly, and so the bills, to the extent that they are able to reduce the time that people are affected by our justice system, to the extent that these bills do achieve that purpose, they are very worthy changes. Similarly, in terms of reducing the costs associated with the service, the administration of justice, this too is a worthy aim because, naturally, the State—and, indeed, it is always the State involved in these matters when a dispute of some sort does reach our courts. It’s to the benefit of the State and therefore the citizens of the State that these matters are heard quickly and efficiently.

Finally, the stakes are increased, often, when matters are delayed, and so in a civil matter, for example, if a matter is not resolved quickly, there might be interest, for example, applied to an amount that’s in contention, and so the longer a matter goes on—the more time, in other words, that it takes to be heard by our courts—the harder it will be, perhaps, for a resolution to be found. I’ve heard from a very good lawyer who’s a friend of mine that a bad lawyer can delay a case for weeks but a really good one will delay it for months. So, perhaps, in that spirit, with a bit of tongue-in-cheek involved, I note that it is in the interest of almost all players in the justice system to have speedy resolution of their cases—

Greg O’Connor: Are you extending or delaying this debate?

CHRIS PENK: So I move now, to the relief of all present, no doubt, including even Mr Gregory O’Connor, to the second purpose, which is to improve users’ experience of the courts and tribunal system. It is an intimidating process to be involved in, no doubt, for many, and so, to the extent that these bills can provide some relief and some remedy in relation to the substance of the case but also relief in terms of the process and the smoothness of that, again, we regard that, on this side of the House—and I think they do on that side of the House, too—as a very positive thing indeed.

Third, to enable a greater use of modern technology. This is pretty well self-explanatory, so I shan’t dwell on it any further, except to say that efficiency and effectiveness, which I might define as the passage of a dispute in the most expedient way possible, and effectiveness meaning, on the other hand, the most robust process possible to achieve the right result in any given case, and timeliness, which I’ve already touched on and I do not intend to belabour that point further.

The fourth is that we will simplify and standardise the statutory powers and procedures of various offices by passing this legislation, albeit that it’s subject, of course, to a further reading and, indeed, a committee stage, at which some changes might be made. But I do acknowledge at this point that the select committee, the Justice Committee, has paid considerable care and attention to the legislation that had come to them after the first reading. Many submitters gave their time very freely and generously in suggesting amendments, and so it is I think that, in terms of simplification and standardisation, we have a better result now for that process having taken place. No doubt colleagues, again, on both sides of the House, will have an opportunity to set out some of those changes that they agreed to, actually, in their select committee report, and as reflected in the departmental report, often as a direct result of various key players in the profession and in the industry, if I may use that word, as to the reality on the ground for these different courts and tribunals.

Finally, to provide better consumer protection and redress and greater access to justice. So much for the purposes; as to the substance, I won’t go through it all in detail—

Rt Hon Winston Peters: Why not?

CHRIS PENK: —and, indeed, I would’ve if time had allowed, but it certainly doesn’t. Some of us are on a tight time frame, Mr Peters. We don’t have the luxury of as much time as you seem to take to get things done. The Courts Matters Bill amends—

ASSISTANT SPEAKER (Poto Williams): Order!

CHRIS PENK: —excuse me, Madam Assistant Speaker—no fewer than 14 Acts—

Chris Bishop: How many?

CHRIS PENK: Fourteen, that’s right—that’s right; no fewer. Courts security, criminal procedure, fines enforcement, and other court processes. So there’s a lot in there, obviously, and the Tribunals Powers and Procedures Legislation Bill naturally relates to tribunals, as the name would suggest.

Rt Hon Winston Peters: Do tell.

CHRIS PENK: The clue’s in the title; it does what it says on the tin. And I shall tell. I shall at least tell to the extent of saying that there are 21 tribunals that are affected, and there are even more pieces of legislation than that on our statute book that will have consequential amendments. Of course I won’t go through them all, but they range very widely from the Accident Compensation Act, Customs and Excise Act, Immigration Act, Social Security Act, and Weathertight Homes Resolution Services Act. I’m sure that many members of this House and, indeed, the vast number of New Zealanders who are watching this debate will be able to think, in each of those cases, of specific tribunals that relate to each of them.

It’s a measure of the nature of the bill, I think, that the departmental report on the Courts Matters Bill alone contains an entire page of acronyms and abbreviations. Any piece of legislation that includes a CSA, a CDA, and a CPA I think is a force to be reckoned with, and we’ll continue reckoning with it in this House by grappling with its subtleties, its intricacies, getting these things right, because they are important for the people of New Zealand.

Rt Hon Winston Peters: Who wrote this?

CHRIS PENK: Who wrote this stuff, Mr Peters asks. It’s all up here, sir—it’s all up here. Yes, sir, it is. Mr Peters, I don’t know where Mr Peters gets his speech from, but I think I can guess.

With that note, I will draw my speech to a conclusion. I look forward to hearing other members’ contributions and, indeed, to the legislation continuing its passage through this House. Thank you.

Hon Dr MEGAN WOODS (Minister of Energy and Resources): Thank you, Madam Assistant Speaker. I’m very happy to take a short call on this bill and to follow the member Chris Penk, who certainly did take the bait that was laid out for him. Look, I would like to congratulate my colleague, the Hon Aupito William Sio, for bringing this bill back to the House in the state that we are seeing it today. It is a vastly improved bill than when he took over as the incoming Minister. What we have is an important piece of legislation, and what we are doing is updating and modernising—

Chris Bishop: He’s had literally nothing to do with it.

ASSISTANT SPEAKER (Poto Williams): Order! [Interruption] Order! Mr Bishop—[Interruption] Order! I cannot hear the member delivering her speech.

Chris Bishop: You’re not missing much.

ASSISTANT SPEAKER (Poto Williams): Mr Bishop, settle.

Hon Dr MEGAN WOODS: Thank you, Madam Assistant Speaker. This is important. This is where over 30,000 New Zealanders accessed justice last year—

Greg O’Connor: A new rival arrived in the House.

ASSISTANT SPEAKER (Poto Williams): Mr O’Connor, you are not helping.

Hon Dr MEGAN WOODS: The previous Government had allowed a backlog to build up within our tribunal system, and it had not adequately resourced them. So I congratulate my colleague, the Hon Aupito William Sio, for actually making the necessary changes.

It is clear to see that some of these needed updating. When we have a look at one of the bodies that—[Interruption]

ASSISTANT SPEAKER (Poto Williams): Order! Order! [Interruption] Order! I apologise to the Minister—[Interruption] Order! Now, when I ask for order, I expect it straight away. I cannot hear the member delivering the speech. I will ask for members to interject if it is witty and relevant, but not for a general barrage across the House.

Hon Dr MEGAN WOODS: Thank you, Madam Assistant Speaker, and I understand this is important legislation, but it’s good to see what lights the Opposition’s fire—that this is what brings them down to the House tonight to get them so riled up in terms of that. But as I was saying before I was so inadequately interrupted by the Opposition, actually, it was obviously time for some modernisation for some of the tribunals on our book. I would like—given the member sitting next to me, Kris Faafoi—to make special mention of the Birdlings Flat Land Titles Commissioner, who is being disestablished under this bill. He was telling me that this was a favourite place of his as a child to go surfcasting. So a proud Cantabrian could not stand by and watch that.

This is important legislation. These are the tribunals where ordinary New Zealanders do access justice. We need to make sure that we do adequately resource them, and we don’t allow the kind of backlogs to build up. When we hear the submissions such as Mr Rodger Haines QC who came to the Justice Committee and said, “For the past three years, a workload of now five full-time decision-makers has been carried out by one person, i.e. the present chairperson.”, we can see that this was just another area of neglect from the previous Government. Thank you, Madam Assistant Speaker.

Hon MAGGIE BARRY (National—North Shore): Thank you, Madam Assistant Speaker. I rise to speak to the Courts Matters Bill and Tribunals Powers and Procedures Legislation Bill at their second readings. Of course National supports this bill, because it was conceived and gestated under our watch. I commend the member Aupito William Sio, who introduced it to the House tonight, but it’s got Amy Adams writ large all over it.

When I look at a thorough and comprehensive approach—which we are well used to on this side of the House, dealing with Amy Adams; how incredibly thorough she is—we see something that is worth modernising. The other side of the House, they never modernise, and this may be very fresh territory for them—an arcane and unknown territory. But modernising and getting around things to ensure modern and efficient practices are used, along with efficient courts and tribunals, are very much what the former Government was all about; so I do commend this member for bringing, in his own way, this piece of legislation to the House.

So the Courts Matters Bill alone, as Chris Penk mentioned earlier, amends 14 Acts.

Rt Hon Winston Peters: He said that!

Hon MAGGIE BARRY: The Tribunals Powers and Procedures Legislation Bill standardises and modernises—something that would be unknown to Mr Peters. Modernising is something that he probably couldn’t even spell, let alone deal with on an intellectual level—

ASSISTANT SPEAKER (Poto Williams): Order! [Interruption] Order! [Interruption] Order!

Hon MAGGIE BARRY: So we have legislation that deals with that across 21 tribunals. It has been alluded to before. It is such an important area that I’ll bring it up again: the Birdlings Flat Land Titles Commissioner. Now, this has been noted by the Opposition as a job that has been finished. It has now moved on; so the authority will be disestablished. These are good things. This is why National supports it. The Health Boards of Appeal and the Maritime Appeal Authority also are probably unknown to members of this House because they were seldom used, and their functions will instead be taken up by the District Court.

So when we work through some of the extraordinarily rich detail of the amendments—I could dwell, for example, on the Real Estate Agents Act 2008, but I choose not to; I would rather look at the Disputes Tribunal Act and the clarification of the Chief District Court Judge, who is wholly responsible for rostering and training disputes referees. Others may mock the detail of this legislation, but it’s extremely important to the smooth workings of our judicial system.

I think that updating the range of legislation that fails to keep pace with modern practice is something that the former National Government concentrated on a lot. Coming up to speed with the 21st century practices is something that the Hon Amy Adams was devoted to. I’m glad that the Government is now picking up on it, because they are slow to acknowledge and embrace consistency, transparency, and efficiency in everything, including the courts. So it is good that they’ve picked this up.

I think the Government has made a number of recent reforms to our justice system that will make that system far easier for people to deal with. There will be fewer backlogs and there will be fewer people waiting. The flexibility and responsiveness and transparency of our court system depend on this piece of legislation going through. I know the Hon Mark Mitchell is right across the detail of this bill and will speak to it with a level of conviction that will astound and astonish this House, because it is really something that he believes in implicitly and to his core. He’s had a lot of experience in this, unlike other members on the opposite side, who have not.

My colleague Chris Bishop had pointed out that the Justice Committee worked long and hard on this and with a lot of intellectual rigour and grunt—“grunt”, do I dare say that word in this House?—and have done tremendous things. My colleague is now nodding sagely, having spent much of his youth embracing the changes that this piece of legislation is about to usher in. It is very important that we modernise and that we are thorough and comprehensive.

I see, unfortunately, that my time is almost up with this call. Although I’m being robbed of, you know, a longer dissertation on the many, many arcane and fascinating elements, I can see someone poised on the opposite side of the House, like a coiled spring, with venom exuding from him, about ready to pounce. So I will commend this bill to the House because it came from us, it makes sense by us and for us, and it’s good for New Zealand. So I commend this bill to the House. Thank you.

Rt Hon WINSTON PETERS (Acting Prime Minister): I move an extension of time, because we like a good joke over here, and that’s been the most comedic half-hour I’ve heard for a long, long time.

ASSISTANT SPEAKER (Poto Williams): That’s very generous of the honourable member, but I don’t think we’ll be taking up that offer.

DARROCH BALL (NZ First): Thank you, Madam Assistant Speaker. I was actually looking forward to coming down and speaking on this bill tonight because it’s quite an important bill—

Barbara Kuriger: I raise a point of order, Madam Speaker. Was that the New Zealand First call? This is the second New Zealand First speaker.

ASSISTANT SPEAKER (Poto Williams): Actually, it wasn’t. The honourable Acting Prime Minister was actually making a request on behalf—he was actually seeking a procedural motion.

Hon Member: Was he doing it under a point of order?

ASSISTANT SPEAKER (Poto Williams): He didn’t call a point of order, but he sought the will of the House to make an extension to the Hon Maggie Barry’s call.

DARROCH BALL: Thank you, Madam Assistant Speaker. Like I was saying, I was actually quite looking forward to coming down and speaking in this House, not necessarily because they are very, very important bills but because I wanted to hear what the Minister had to say in bringing these changes that have been made to these bills in the previous Government, and about the very good changes coming through. But the excitement actually dissipated from me when I had to hear from the Hon Maggie Barry and the ridiculousness that was coming out of her mouth and the viciousness—the venom that was coming out of her mouth in regards to the insults coming across to this side of the House.

You know, I have been known once in a while to be a bringer of fact. It’s not a nice job, but some people have to do it in this House. Obviously the speeches in the House from the National Party tonight have been absolutely and totally bereft of fact, but the reason why it is absolutely necessary for this legislation to be brought to this House—not only that, but the changes that have needed to be made by the Justice Committee and by this side of the House. Here are a couple of facts: as of June this year, there’s been a backlog. There has been a backlog 135 people to the Human Rights Review Tribunal—135.

Rt Hon Winston Peters: How many?

DARROCH BALL: One hundred and thirty-five, but that’s just the start of it—that’s just the start of it. This incompetent National Party, when they were the Government, the incompetence was palpable. One of the facts in regard to this topic was the fact that between 2014 and 2017 the backlog jumped 144 percent.

Hon Member: How much?

DARROCH BALL: One hundred and forty-four percent. So we can hear all of the nice one-liners that they seem to want to repeat, because they hand around the speech notes that they’ve been given because they’ve run out of speechwriters for them because they’re in Opposition right now. They want to start talking about the one-liners: how it was the Hon Amy Adams who brought this to this House and how it was the National Government that brought this important legislation to this House. Well, that may be true—that that member who said she did actually did. That may be true, but why was it nine years? Why did it take nine years? If this was such an important piece of legislation that those National Party members have been standing up and saying was so essential and that it was the National Party and the previous National Party Minister that had the initiative to bring it to this House; why did it take nine years? Why did it take nine years? Not only that fact, but the stats that I’ve read out were from June this year and 2017. You can’t get any more current than that. If it was one of the reasons why the Minister brought it last term, it was because of the reactionary nature that that Government was producing for the people of this country.

These are a couple of bills that are very important, and that is why—and they’re very similar bills. For those that have been watching that have heard the term “cognate bills”, it’s because they are similar in nature, but very, very important. One of the major reasons is because of the technology that, obviously, this country and society, and Western society in general, especially in our courts, have needed to update, but over the past 10 years there has been under-resourcing and neglect from the National Party to be able to achieve that. That’s what this piece of legislation is going through right now in the House and it’s taken us less than nine months to do so. We are willing, as a Government, as a coalition with the support of the Greens, to make sure that our courts and our justice system—and that includes the police, Mr Mitchell—are all fully resourced to ensure that the continuum of the justice system is 100 percent working for the people of this country.

There are a couple of things that I just want to point out before I finish on my short call, and it’s quite important. We’ve been hearing that these bills do one major thing and that’s speed up the process: saving time or reducing the time and making sure it flows for the people of this country. As you all know, the foundation of a robust democracy is a functioning, fair, and accessible justice system, and that’s what this piece of legislation does. But I think it’s very important to point out that even though one of the main intents and objectives of this bill is to speed up the process, it needs to be ensured that it’s balanced with the process being fair and robust. I think that this bill does that.

Lastly, I just wanted to go through the report. Unfortunately, I’m not sitting on the Justice Committee at this point. I would love to dearly, but I’m just going through the report of the Courts Matters Bill, and one of the most important things—and there’s many points that have been pointed out from all of the speakers in the House today; that it’s quite a detailed bill of smaller changes, but I think one of the most important ones that I’m interested in is about Youth Court proceedings.

At the moment, as the legislation stands, if a conviction of a young person has come to its conclusion in the District Court, that conviction would stand even if there was a filing error and that young person shouldn’t have been in a District Court in the first place; that young person should’ve actually gone through the Youth Court, and, at this stage, the conviction was found. That is clause 40, and the recommendation from the Justice Committee is that it be removed, because we feel that that is wrong.

I’d just like to finish there, and I’d like to thank the Minister and the Labour - New Zealand First coalition Government for bringing this forward in such a timely manner—with the support of the Greens. Thank you, Madam Assistant Speaker.

Hon Kris Faafoi: “Deputy Dawg”!

ASSISTANT SPEAKER (Poto Williams): I call the Hon Mark Mitchell, and I will just caution the member Kris Faafoi to remember to use a member’s proper name.

Hon MARK MITCHELL (National—Rodney): Oh, he’s been waiting for this all night, Madam Assistant Speaker. Let him have his fun.

It is a pleasure to stand and take a call on the second readings of the Courts Matters Bill and Tribunals Powers and Procedures Legislation Bill. Can I acknowledge the Associate Minister of Justice, Aupito William Sio. I’m sure he felt that all his Christmases had come at once when he saw the quality of this bill and he realised that he was going to be given the opportunity to actually shepherd this bill through the House. He wouldn’t have seen work like this in his nine years in Opposition, and he came into Government and he thought, “Wow, look at this—the quality of the bill.”

Hon Aupito William Sio: Madam Assistant Speaker, I’m leaving!

Hon MARK MITCHELL: No, stay, please—don’t go! I’m only just getting started. I just want to acknowledge the Minister and also the ministry staff that have worked on putting this very good bill together.

In all seriousness, it is very important, actually, especially for victims. Going to court can be a pretty traumatic experience; so any work that can be done around making sure that that experience is actually eased for them a bit more is actually a very good thing.

I just wanted to talk, too, about the tribunals briefly. I want to talk about the disputes tribunal, because I actually brought a private member’s bill to this House back in 2013, I think, and it was around the disputes tribunal, and it was about raising the threshold from $15,000 to $30,000.

Rt Hon Winston Peters: What happened?

Hon MARK MITCHELL: Well, the reason why I did that is because—well, it got taken up as part of this bill. It’s now in this bill.

Rt Hon Winston Peters: Really?

Hon MARK MITCHELL: Have you read the bill?

Rt Hon Winston Peters: In 2018?

Hon MARK MITCHELL: Yeah, it’s right there. It’s been taken up by the Government, and it’s a very, very good piece of the bill. The reason it is is because, at no other time in the last nine or 10 years, have businesses ever needed more help than right now. The reason for that is that we have a Government that doesn’t like business. They’re implementing policy after policy, and they’re finally starting to get some of their own legislation into the House tonight. I have to go back to the comment made by Mr Ball, which I found fascinating, that, after nine months in Government, finally they’re starting to get some of their own legislation into the House. Up until now, they’ve been passing all ours; they’ve been bringing in all our legislation.

Look, I do want to acknowledge Mr Ball as well. He’s got a very good bill that he’s proposing to bring to the House. We had a meeting—myself and Mr Bishop—with him on it the other night. It’s the Protection for First Responders and Prison Officers Bill. It’s an outstanding bill, because what it’s going to do—

ASSISTANT SPEAKER (Poto Williams): Order! Can we come back to this bill?

Hon MARK MITCHELL: If you can bear with me for just a minute, I’ll be very quick, Madam Assistant Speaker.

ASSISTANT SPEAKER (Poto Williams): No.

Hon MARK MITCHELL: OK. Well, I’d just like to say that it was a great bill. I have to say that Andrew Little didn’t seem that happy about it, but certainly we support it. So, coming back to the disputes tribunal, we extended the limit from $15,000 to $30,000. It’s actually a great idea, because what it means is that, with this change, especially small businesses, which, really, had to almost give up a claim because the threshold was not high enough—so they had to give up large parts of their claim—they can now take it to the disputes tribunal. So they can stay away from lawyers, they can stay away from the costs associated with actually trying to get that hard-earned money back, and they can take it straight into the disputes tribunal. Wouldn’t you agree that that’s a great part of it?

Hon Dr Megan Woods: Why didn’t you do it while you were in Government? Why didn’t you do it?

Hon MARK MITCHELL: Isn’t that a fantastic part of the bill? We have done it; this is our bill. We have done it; it’s in the House. It’s our bill; we have actually done it. I’ll tell you what, tell me about clause 40. Do you think clause—

ASSISTANT SPEAKER (Poto Williams): Mr Mitchell.

Hon MARK MITCHELL: Sorry, I apologise. I get a bit over-excited with this stuff, Madam Assistant Speaker. I apologise. So can I ask the member—actually, can I ask the Rt Hon Winston Peters: do you think that removing clause 40 from the Courts Matters Bill was a good move?

Rt Hon Winston Peters: I raise a point of order, Madam Speaker. Now look, I know it’s late at night and some of those of those members over there are getting tired, but they must not bring you into the debate.

ASSISTANT SPEAKER (Poto Williams): Thank you very much.

Hon MARK MITCHELL: So let me rephrase it: does the Rt Hon Winston Peters think the removal of clause 40 was a good decision on this bill? What does he think?

ASSISTANT SPEAKER (Poto Williams): Continue with your speech.

Hon MARK MITCHELL: Oh, I’m very interested to know, because he’s had a lot to say. He wanted the detail. He wanted to know the detail.

Hon Member: Take another call.

Hon MARK MITCHELL: Take another call? Someone take a call and come and talk to me about clause 40. I’ll tell you what: I’ll let you off the hook and I’ll tell you what clause 40 is all about. Clause 40 was taken out and, actually, I think it was a good move because, fundamentally, what it meant was that they were trying to—it related to section 380, which meant that if, by mistake, the prosecutor lodged the information with the District Court, which meant that you had a youth that should have been tried in the Youth Court taken into the District Court, clause 40 was proposing that, actually, if it was discovered during the case, then they’d have to remain in the District Court. But actually what happened was that—

Rt Hon Winston Peters: That’s what he said.

Hon MARK MITCHELL: Well, you were very silent a minute ago when I was asking you.

ASSISTANT SPEAKER (Poto Williams): Order! Order!

Hon MARK MITCHELL: So I’m a bit confused—did you know or didn’t you know?

ASSISTANT SPEAKER (Poto Williams): Order!

Hon MARK MITCHELL: Sorry, Madam Assistant Speaker. I thought it was polite to engage. But, anyway, clause 40 was removed because, actually, it was decided that you don’t want to remove the right for a youth to actually have access to all the support services in the Youth Court. So that was a very good decision; one that we supported, in this bill. [Interruption]

ASSISTANT SPEAKER (Poto Williams): Order!

Hon MARK MITCHELL: The other thing that I wanted to talk about very briefly was around actually giving court officers more powers in their ability to do their job. They are now able to deal with drug paraphernalia under the Misuse of Drugs Act, which is very important.

It expands the definition of “court” to include “any space between the building and the road”. I’ll tell you why this is important—and it comes back to talking about the rights of victims and the trauma that they experience when they go into court—very often you will get the family of defendants, or if it’s a gang member or multiple gang members that might be facing charges in court, they will all accumulate outside the court. They do that for one reason and one reason only: to intimidate the victim or the victim’s family or the victim’s friends when they are entering the courthouse. So what it means now is that the court has got jurisdiction and control over that area, which once they did not; it was a public area between the courthouse and the road. So that means that they’ll actually be able to make it a bit safer and control that area a lot more, which means that victims are not going to have to face the intimidation that I’ve often seen myself when they are just trying to do a basic thing like get inside the courthouse.

They are also going to be able to have the power to use reasonable force when pursuing an escapee, and I think that this is—[Interruption]

Hon Tracey Martin: Ha, ha!

Hon MARK MITCHELL: Well, it’s funny that Tracey Martin finds this funny. I don’t want to get started on her—a politician that should be in Somaliland rather than New Zealand, with her foot soldier there sat beside her, but we’ll wait for a general debate on this one. Why don’t we wait for a general debate on this one, right?

Chris Bishop: How’s the inquiry going?

Hon MARK MITCHELL: Yeah, the inquiry—exactly. Well, let’s wait for some other time on that one. Anyway—[Interruption]

ASSISTANT SPEAKER (Poto Williams): Order!

Hon MARK MITCHELL: A court security officer is able now to pursue someone that is trying to escape court. Fundamentally, I think this is—

Hon Tracey Martin: Spell my name right. Spell my name right, for goodness’ sake!

Hon MARK MITCHELL: It’s very hard. It’s like nails on a blackboard. It’s very, very hard to—

ASSISTANT SPEAKER (Poto Williams): It is indeed a disorderly session tonight. Can we just settle, please? We’ve only got a few more minutes till the end of the evening.

Hon MARK MITCHELL: Thank you, Madam Assistant Speaker. So this is another very good change that’s being implemented in the bill, which will actually discourage offenders from thinking that they can decamp from the courthouse, because now the court officers—and many of them are ex - law enforcement officers—have got the ability to stop that. This is a very good bill. I’m very happy to have taken a call and recommend this bill to the House. Thank you.

GOLRIZ GHAHRAMAN (Green): Thank you, Madam Assistant Speaker. It’s a pleasure to rise to speak to both these bills and leave aside the great raging dispute that’s gone on in the House tonight, between members from both sides, about who, in fact, is responsible and should be commended for bringing these reforms to our criminal justice system or justice system as a whole. Leaving all of that aside, I wanted to focus on some of the details, in terms of the Courts Matters Bill, that jumped out to me.

This is a bill that covers matters from the very functional powers of security guards to the very complex procedures that apply where a person is claiming mental impairment and fitness to stand trial. That particular process is one that I’ve got some experience of and I know was absolutely nonsensical under the previous law. I was very happy to see the procedure reversed. Previously, where a person was potentially unfit to stand trial—suffered from a disease of the mind, which is the very high standard—the court would first hear, in an actual disputed hearing, whether or not the actual crime is likely to have occurred, before that person had access to expert reports on their sanity. So, as a lawyer, where a client was potentially not fit to stand trial, it was very hard to adduce from them, for example, alibis and things like that so you could even have that hearing. So, essentially, that’s being reversed so that the expert psychological reports come first, and if the person’s not fit, then the matter is disposed of—far more efficient.

Many of the matters covered by this bill go to efficiency. One of the main ones is the procedure to use audiovisual links (AVL) in all sorts of new ways—so video linking to accused persons from where they’re held, for example, for types of hearing where there’s no need for them to attend. This does expedite proceedings, but I would just note, from the front lines of the justice system, that not all procedures, not all matters heard by the criminal courts, are actually suitable for this kind of process. So while this is available and it will help to address the backlog in our courts, it would be good to see the new funding that this Government is going to put into our justice system so that we do, in fact, have enough judges to hear things that do require a higher level of procedural safeguard, like opposed bails, for example, that actually affect a person’s rights not to be arbitrarily held. Where a person is using AVL in a process like that, they very rarely have access to counsel, who are in court and not able to speak with them via AVL.

So, moving on to the Tribunals Powers and Procedures Legislation Bill, I would like to focus on the effects that this will have on the Human Rights Review Tribunal. We’ve heard tonight a few mentions of Rodger Haines QC, which I was very happy to hear. He’s just been honoured in the latest Queen’s Birthday honours. He has been a world-renowned human rights lawyer, focusing on refugee law, which I wish most New Zealanders knew something about. He was the previous president of our refugee appeals authority and changed the world when he recognised the rights of the rainbow community to asylum. He is now the president of the Human Rights Review Tribunal, and the Justice Committee has heard from him about the backlog.

Now, those of us who have worked in the human rights sector know that the right to justice itself is, in fact, denied when it is so delayed that victims are waiting two years for a hearing and up to three years now for a decision. When we think about the types of cases that go to the Human Rights Review Tribunal, these are discrimination cases, privacy cases, and cases that affect the disabled community.

The last one that I had anything to do with was actually involving the family carers’ case. So just to put into context the kind of cases that are coming through this tribunal and are so badly delayed, the family carers case involved family members caring for their profoundly disabled loved ones without proper financial support. Where their family members were placed into corporate care, they would get up to $70,000, but the family carers were fighting to get minimum wage. So they brought a discrimination case—discrimination based on family relationship is unlawful in New Zealand—and they eventually won. It took them years. They won and the National Government passed legislation, under urgency, to cut the family carers off from the Human Rights Act’s remedies regime—under urgency, in the dead of night, without consultation. These are important cases, these are important issues, and they are so delayed as to be waiting two years for hearing—two years, vulnerable people.

Debate interrupted.

The House adjourned at 10 p.m.