Tuesday, 16 October 2018

TUESDAY, 16 OCTOBER 2018

TUESDAY, 16 OCTOBER 2018

The Speaker took the Chair at 2 p.m.

Prayer

Prayer

SPEAKER: Faakalofa lahi atu. I have invited the Hon Alfred Ngaro to recite the prayer in Niuean.

Hon ALFRED NGARO (National): Ko e Atua nae, kua ole mo e fakatokolalo atu a mautolu ke he Haau a takitakiaga mafola, kia tuku kehe e tau manako fakatagata, ka e ole atu ki mua Haau kia tonu mau e lilifu he tau tauteaga oti ki loto he Fale nei mo e ha mautolu a motu ne fakaheke ke he Haau a higoa Tapu, ke fakafetui mau mo e taute e tau fifiliaga tonu ki mua he lilifu ko e Patuiki Fifine, mo e lalolagi mo e tau tagata katoa, ke he mafola, mo e milino a Niu Silani katoa, ha ko e higoa ha Iesu Keriso, ko e ha malu Iki. Amene.

Speaker’s Statements

Jami-Lee Ross—Change of Parliamentary Membership

SPEAKER: Under Standing Order 35(1)(c), I have been advised by the senior Opposition whip that the National Party’s parliamentary membership has changed and that Jami-Lee Ross is no longer a member of the National Party for parliamentary purposes. Accordingly, under Standing Order 34(5), Jami-Lee Ross is, from 16 October 2018, regarded as an Independent member for parliamentary purposes.

Oral Questions

Questions to Ministers

Question No. 1—Prime Minister

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

Rt Hon JACINDA ARDERN (Prime Minister): Fakalofa lahi atu, Mr Speaker. Happy Niuean Language Week, and to answer Mr Bridges’ question, yes.

Hon Simon Bridges: Does she stand by her statement last week that, since October 2017, “petrol prices have risen roughly 39c, of which 6.8c at that point could be attributed to taxes and levies;”?

Rt Hon JACINDA ARDERN: The member will be referring to my press conference, the first time I made that comment. I stated “between 27 October 2017 and 28 September 2018—this is where we have data—petrol prices have risen roughly 39c, of which 6.8c at that point could be attributed to taxes and levies;”, so I absolutely stand by that statement.

Hon Simon Bridges: Is she aware that the tax figure she referenced—6.8c of the 39c increase since last October—is only the GST and emissions trading scheme component and did not include the new excise tax or the regional fuel tax in Auckland?

Rt Hon JACINDA ARDERN: Yes, which is why I indicated the data was through to 28 September, because that is the data I had available, and I was very explicit about that. What it would be nice to have the member opposite being explicit about is what transport projects he intends on cancelling, given he doesn’t want excise to exist in New Zealand any more—or he might not be in the position to have to cancel anything because it requires being in Government.

Hon Simon Bridges: Did she not include all of the relevant taxes and, in so doing, underrepresent the actual tax increase, given the Government has imposed a regional fuel tax of 11.5c and an excise tax of 4c a litre?

Rt Hon JACINDA ARDERN: Again, I gave the data that was available at the exact time that I stood up at the press conference. I can give the member the exact data today, which includes that fuel prices have risen now 46c, of which tax is 9.53c. The fact remains, there is an exceptional increase in fuel prices that cannot be reasonably explained, which is why this Government is changing the law so we can seek out some answers on behalf of consumers. Either that side thinks it’s acceptable that they’re paying that much or they don’t.

Rt Hon Winston Peters: Is it a fact that on the weekend—that’s yesterday—Shamubeel Eaqub had that same precise calculation in two papers?

Rt Hon JACINDA ARDERN: Yes, because he would have been relying on the Ministry of Business, Innovation and Employment (MBIE) data as well, which is what I have provided in public and, again, to this House.

Hon Simon Bridges: Does she now accept that her petrol taxes have had a significant impact on the cost of living of New Zealanders?

Rt Hon JACINDA ARDERN: I’ve been very open about the proportion that has been around excise and regional fuel tax—

Hon Dr Nick Smith: You haven’t been open.

SPEAKER: Order!

Rt Hon JACINDA ARDERN: —versus what cannot be explained. Now, this seems to be in direct contradiction to when that member was in Government. They undertook their own review and came out with a finding that said they could not reasonably determine whether or not consumers were paying a fair price. That’s not good enough on this side of the House, and we’re doing something about it.

Rt Hon Winston Peters: If petrol prices are so high, how could an individual afford to drive all the way from Auckland to Wellington just to deliver a message inside this building this morning?

Rt Hon JACINDA ARDERN: Mr Speaker—

SPEAKER: Order! The member has no responsibility for that.

Hon Simon Bridges: Does she now accept that her petrol taxes have had a significant impact on the cost of living for New Zealanders?

Rt Hon JACINDA ARDERN: I accept that fuel prices, at the moment, have had an element we cannot explain in the last 10 years. The importer margin has gone up. The importer margin has gone up and, clearly, that side of the House will not accept that excise and the regional fuel tax are only a small portion of what consumers are paying at the pump. I have to say, given that side of the House increased it by 17c, its now crying wolf over excise use seems pretty rich to me. There is a problem. There is a problem, but we’re trying to get to the bottom of it, because we know what excise is and the vast bulk of what consumers are paying is not about that.

Hon Simon Bridges: What will she do if it turns out that the regional fuel tax is being included in the importer margin and, therefore, is overinflating the increase of the importer margin she’s referring to?

Rt Hon JACINDA ARDERN: Well, I’m not going to leave it to an “if”. We’re sending in the Commerce Commission to find out exactly what is going on, unlike that Government, who, when they were in office, chose to just sit by when we could not determine whether consumers were paying a fair price or not. Again, I reiterate: if that side of the House thinks it’s all about excise and fuel tax, then I’d like them to tell me what they are going to cancel. Is it going to be the Penlink?

Hon Simon Bridges: So why was the regional fuel tax hidden inside the importer margin?

Rt Hon JACINDA ARDERN: Again, from the advice that I’ve received, there are explanations that do not exist around the inflated price that consumers are paying, which is why we’re having the Commerce Commission look at it.

Hon Simon Bridges: How can New Zealanders have confidence in her ability to deal with their cost of living rises when she is relying on numbers that do not even measure the increase of her petrol taxes that, as I say, her Government has imposed?

Rt Hon JACINDA ARDERN: I’m relying on the same data that member relied on when he was in Government, and what I’m also asking questions around is why—

Hon Simon Bridges: I didn’t put the taxes on.

SPEAKER: Order!

Rt Hon JACINDA ARDERN: —is MBIE automatically adding coupon and fuel card discounts to the rate of 14c to those numbers as well. But if you want to talk about the cost of living, this is a Government that put more than $5 billion back into the pockets of low and middle income New Zealanders, that increased the minimum wage, that has focused on lifting the incomes of those who need it most, and that is getting to the bottom of what’s going on with fuel.

Hon Simon Bridges: If she has already decided that the fuel companies are “fleecing” consumers, why is she not doing something about that now rather than undertaking a market study?

Rt Hon JACINDA ARDERN: We are. We need the evidence before we move forward.

Hon Simon Bridges: With inflation numbers out today showing petrol prices have increased more than any other item in the last year, why is she still going ahead with more than 24c worth of petrol tax increases in the space of just three years?

Rt Hon JACINDA ARDERN: I could probably find a quote from the Opposition for exactly the same set of circumstances.

Question No. 2—Finance

2. TAMATI COFFEY (Labour—Waiariki) to the Minister of Finance: What recent reports has he seen on the New Zealand economy?

Hon Dr DAVID CLARK (Acting Minister of Finance): Fakalofa lahi atu. Last week, Treasury released the Government’s financial statements for the year ended 30 June 2018, showing the Government’s books are in good shape. The results show a $5.5 billion operating balance before gains and losses surplus, $2.4 billion above Treasury’s Budget 2018 forecast—yes, it was $5.5 billion—and net core Crown debt at 19.9 percent, compared to the 20.8 percent forecast at Budget time. The financial statements are the first official check-in on the Government’s commitment to run surpluses, manage net debt, and keep expenses under control. We have clearly demonstrated that we are doing so.

Tamati Coffey: What factors contributed to this strong result?

Hon Dr DAVID CLARK: A variety of factors contributed to this result being ahead of Budget 2018 expectations. A number of one-offs led to core Crown expenses coming in 1.4 percent below forecasts, which Treasury says was largely due to timing issues. Much of this variance is set to reverse out in the 2018-19 accounts. A strong economy contributed to core Crown tax revenue coming in 0.9 percent higher than expected in the year to 30 June 2018. Corporate tax revenue was up due to profits for both large and small businesses being higher than Treasury had forecast at Budget 2018. This result indicates the continued strength of New Zealand’s growing economy.

Tamati Coffey: What do these results mean for New Zealand’s economic and fiscal resilience?

Hon Dr DAVID CLARK: These results confirm that our underlying economic fundamentals are strong and the Government’s books are in good order. However, it is important that we continue to run surpluses and manage debt. Economists are pointing to rising risks in the international economy, particularly from trade protectionism and stock market movements. We need to ensure New Zealand remains well placed to withstand and respond to these external risks.

Question No. 3—Finance

3. Hon AMY ADAMS (National—Selwyn) to the Minister of Finance: Is it a goal of this Government’s economic policy to make it easier for New Zealand families to get ahead?

Hon Dr DAVID CLARK (Acting Minister of Finance): Fakalofa lahi atu. Yes. This Government believes we all win when we grow our economy for the benefit of all New Zealanders.

Hon Amy Adams: With petrol prices hitting record levels, will he then reconsider the petrol excise increases and the regional fuel tax in light of comments by groups like Auckland Action Against Poverty that these taxes are taking food off the table of some of our poorest families?

Hon Dr DAVID CLARK: To make the essential transport investments that are needed in Auckland and around the rest of the country, after nine years of neglect, we will do what we need to do, and to close, of course, the Auckland Transport Alignment Project gap, which exploded under Simon Bridges’ watch as the Minister of Transport. I also note that the previous Government increased petrol excise duties by 17c per litre.

Hon Amy Adams: Well, given that answer, is he aware that the previous Government actually increased fuel excise taxes, on average, less than 2c a year, as well as abolishing the Auckland regional fuel tax, compared to this Government, that’s increasing fuel taxes by 24c in just three years?

SPEAKER: I’ll let the member answer it only on the basis that it hooks into a supplementary answer that he gave.

Hon Dr DAVID CLARK: OK. We saw petrol prices explode under that Government’s watch, with excise duties up 17c per litre, and still they were behind on infrastructure funding. We are committed to getting Auckland moving, to making sure that trucks can carry goods and that people can get on public transport to get to work. We know that it costs the economy, on average—well, it’s been estimated—a billion dollars a year in lost productivity because of the neglect under that Government’s watch.

Hon Amy Adams: Does it help Kiwi families to get ahead to impose housing policies that the Ministry of Business, Innovation and Employment (MBIE) have told the Government are likely to raise rents?

Hon Dr DAVID CLARK: I don’t have information on that in front of me—it’s obviously a wee way from the primary question—but I’m happy to answer in greater detail if the member wants to put it down in writing.

Hon Amy Adams: Well, has he read MBIE advice that said the policies—

SPEAKER: Order! Order! I probably have, but you’d better ask the Minister.

Hon Amy Adams: Has the Minister read MBIE advice that said that the policies of this Government are also likely to decrease the security and affordability of gas supply and possibly electricity, and how will higher gas and electricity prices help Kiwi families get ahead?

Hon Dr DAVID CLARK: This Government is committed to moving towards a more sustainable economy that benefits all New Zealanders, and we make no apologies for that. We’ve also got policies that will fill skills gaps and maintain New Zealand’s place in the world. We have desirable policies on this side of the House. We’re out to benefit the regions and grow the economy, and we make no apology for that.

Rt Hon Jacinda Ardern: Has the member seen advice around what difference the healthy homes guarantee and insulating homes for families will make, abolishing letting fees will make, and increasing Working for Families, bringing in Best Start and the winter energy payment, and lifting the minimum wage will make to low-income families?

Hon Dr DAVID CLARK: Without a doubt, this Government has policies that will benefit low and modest income New Zealanders and is putting them in place. We know that hundreds of thousands of New Zealand families will benefit from the Best Start package, for example, which will see those families $75 each better off when the policy is fully implemented.

Rt Hon Winston Peters: On the effect, Minister, of petrol price increases, whose calculations does he believe: those of Jami-Lee Ross or Amy Adams?

SPEAKER: Oh, no. I—

Hon Amy Adams: So why won’t the Minister just acknowledge that with new taxes pushing the cost of petrol to record levels, rising rents, and electricity price rises looming, New Zealanders are going to find it harder and harder to get ahead under this Government?

Hon Dr DAVID CLARK: Inflation remains controlled and below the Reserve Bank target mid-point. Wages are rising faster than inflation, meaning that most Kiwis are seeing real-term increases in their incomes. Of course we acknowledge that too many Kiwis are doing it tough after years of neglect, but no real economic data that we’ve seen moves us away from our goal of delivering a productive, sustainable, and inclusive economy where all New Zealanders share in the benefits of growth. I would note that Statistics New Zealand said that on an annual basis, fruit and vegetable prices fell; meat, fish, and poultry prices fell; clothing prices fell; and household appliance prices fell.

Question No. 4—Housing and Urban Development

4. Hon JUDITH COLLINS (National—Papakura) to the Minister of Housing and Urban Development: What advice, if any, has he received from MBIE on reforming the Residential Tenancies Act 1986?

Hon PHIL TWYFORD (Minister of Housing and Urban Development): Thank you, Mr Speaker. Fakalofa lahi atu. I have received advice from both the Ministry of Business, Innovation and Employment (MBIE) and the new Ministry of Housing and Urban Development. The advice was primarily about how we strike a balance between providing tenants with security of tenure and allowing them to make their house a home, while protecting the rights and interests of landlords. This advice was the basis of the consultation document that we released in August this year. Our tenancy laws are antiquated and this Government is committed to modernising these laws so that every New Zealander has a warm, dry, and secure home.

Hon Judith Collins: Has he seen advice from MBIE that cumulative changes may lead landlords to sell their rental properties and leave the housing market?

Hon PHIL TWYFORD: The advice from MBIE makes it clear that the policy changes that the member is asking about should have minor effects on the housing market. Landlords, of course, will make their own commercial decisions. However, if a landlord does sell, that property will either be bought by a first-home buyer or another landlord.

Hon Judith Collins: When he announced his changes to the Residential Tenancies Act, was he aware that his officials had advised him that supply in rental accommodation would decrease and lead to increased costs for tenants?

Hon PHIL TWYFORD: I want to acknowledge that this is a time of uncertainty for landlords. We have a big reform agenda in place to make life better for renters and landlords, and we are committed to striking the right balance between a tenant’s right to make a house a home, while ensuring that landlords can still get rid of rogue tenants and protect their asset. The Reserve Bank research shows that rents are driven primarily by supply and demand, not landlord costs, and that’s why we are firmly focused on building our way out of the national housing crisis and increasing the supply of housing, both for rentals and owner-occupiers.

SPEAKER: Before I go to Paul Eagle, I am going to ask the Minister to answer the question.

Hon PHIL TWYFORD: Mr Speaker, would you mind having the question repeated?

Hon Judith Collins: Thank you. When he announced his changes to the Residential Tenancies Act, was he aware that officials had advised him that supply in rental accommodation would decrease and lead to increased costs for tenants?

Hon PHIL TWYFORD: I was aware of advice that said that the effects of our reforms were likely to be minor, and that houses that were sold by landlords, for example, who are over-leveraged, or who owned rental properties that were in such poor condition that it would be too expensive to bring them up to the Healthy Homes guarantee standards—those homes would be sold on, either to renters or to other owner-occupiers, and that any effect on rents would be likely to be minor.

Hon Judith Collins: If, as reported by the department of building and housing, rents have increased by $25 per week since he has been the Minister, does he expect them to go up even more next year?

Hon PHIL TWYFORD: Well, MBIE data shows that average rents for new tenancies in Auckland sat at $543 a week in August, only $7 up from the same period last year, and down from $550 in June. In Wellington, they were at $442 a week in August, $19 up from the same month last year, but down from a peak of $516 in February.

Paul Eagle: Fakalofa lahi atu. What response has there been to the proposed changes to the Residential Tenancies Act 1986?

Hon PHIL TWYFORD: There have been over 2,000 completed submissions, and a further 1,800 submissions are under way. I want to encourage every landlord and tenant to tell us their views on how we can strike the right balance between a tenant’s right to make a house a home while ensuring that landlords can still get rid of rogue tenants and look after their asset.

Hon Judith Collins: Does he expect rentals to go up again next year?

Hon PHIL TWYFORD: Our goal—our policy goal—and my expectation is that the housing market under our policies will stabilise, both for house prices and rents. And as I said before, Reserve Bank research shows that rents are set by supply and demand, which is why we’re focused on increasing the supply of housing. KiwiBuild is ramping up, and we are increasing the number of public houses through Budget 2018. In Auckland, there were 12,959 new building consents in the year to August 2018, a record for Auckland that eclipsed the last record set in 2004 under the Clark-Labour Government.

Hon Judith Collins: Does he still say that if property investors don’t like the proposed changes, they should “put their money elsewhere”, as reported by media last month?

Hon PHIL TWYFORD: A country needs good landlords, and it’s lucky for us that most landlords are good people trying to do the right thing and provide a service. Our policy, in contrast to the party sitting opposite, is to set decent minimum standards for the 21st century that will professionalise the rental market and clean out the rogue operators at the bottom of the market who are undercutting good landlords and giving the whole industry a bad name.

Question No. 5—Education

5. JAN TINETTI (Labour) to the Minister of Education: What challenges, if any, does the Government face to ensure that there are enough teachers in classrooms next year?

Hon CHRIS HIPKINS (Minister of Education): The first challenge that we faced was a lack of reliable information on the extent of teacher shortages. On becoming Minister, I asked for a detailed model and forecast to be done and for the education sector to be consulted on that. That modelling shows that without further action we could be up to 650 primary and 200 secondary teachers short at the beginning of next year. With this information, we’re now able to work with schools with much greater certainty to address the shortage that we inherited.

Jan Tinetti: What announcements has the coalition Government made that will get the additional teachers needed for next year?

Hon CHRIS HIPKINS: We have made three significant announcements since becoming the Government: the first in December, another with the Budget, and then the latest over the weekend. As a result, we have fully paid for refresher training for 1,250 teachers whose registration would otherwise have expired. We’ve approved nearly 200 overseas relocation grants with a lot more to come, and we have provided better support for beginning teachers so we don’t continue to lose the one in five teacher graduates who have been finishing their qualifications but not making it to the classroom.

Jan Tinetti: What is the coalition Government doing to ensure a sustainable supply of teachers in the long term?

Hon CHRIS HIPKINS: The first thing we needed to do to ensure a long-term supply of teachers was ensure we had accurate forecasting and modelling. Now that we have that, the work on the longer-term workforce planning is well under way, and I’m confident that that workforce strategy will ensure we have a sustainable teaching workforce and an education workforce to support them well into the future.

Question No. 6—Transport

6. Hon PAUL GOLDSMITH (National) to the Minister of Transport: How much of the increase in fuel prices since the Government took office does he attribute to taxes and levies?

Hon PHIL TWYFORD (Minister of Transport): Since the Government came to office, it’s made two decisions regarding taxation on fuel. Legislation was passed allowing Auckland Council to collect a regional fuel tax of 10c a litre. This will fund projects including Mill Road, Penlink, and $550 million worth of safety improvements, at a cost of $2.60 a week to the average Auckland household. An excise increase of 3.5c a litre came into force on 1 October. This will enable the Government to make safety upgrades, invest in neglected regional roads, and tackle congestion, at a cost of 75c a week to the average household. For context, the pre-tax cost of petrol has risen by 35c in the past year, including a 9c a litre rise in importer margins.

Hon Paul Goldsmith: I raise a point of order, Mr Speaker. This was a question on notice: how much of the increase in fuel prices does he attribute to taxes and levies? He’s given us two figures but he hasn’t added them up and he hasn’t added any GST to it. So I haven’t got an actual answer to the question that I asked.

SPEAKER: Well, I think the member’s skills are—he could probably add them and divide them by eight, couldn’t he? Or by six or whatever one does these days?

Hon Gerry Brownlee: I raise a point of order, Mr Speaker. Questions on notice should be taken in a much more literal sense than perhaps a question that’s asked as a supplementary, where a Minister might—

SPEAKER: I think the member’s point is fair enough. I’m going to ask the Minister to have another go, and he can give us one of two figures: the percentage or the number.

Hon PHIL TWYFORD: Sorry, sir, could you repeat that again.

SPEAKER: I’m suggesting that the member answer the question directly. He can either give a number in cents or he can give a number in the percentage change.

Hon PHIL TWYFORD: The Government’s made two decisions regarding taxation on fuel. The first is 10c a litre plus GST, an excise increase of 3.5c a litre plus GST. In comparison to that, there is a 35c increase in the pre-tax cost of petrol.

Hon Paul Goldsmith: So does he agree that the Prime Minister’s summation on 8 October that taxes and levies amounted to 6.8c was wrong?

Hon PHIL TWYFORD: Well, I think the Prime Minister provided the context and should have eliminated any doubts the member had about her statement. In the press conference that the Prime Minister gave, she used figures for the share of the increase in petrol prices that had gone to central government in the year to 28 September—the latest for which data was available. This was made up of an increase in the emissions trading scheme charge and GST, both of which were set by the previous Government. Now, obviously at that point, the excise increase had not then come into effect. The regional fuel tax goes to Auckland Council, not central government, and, as the Prime Minister has said, accounting for fuel excise increases, New Zealand’s taxes are the sixth lowest in the OECD, and including the regional fuel tax Auckland’s are the 10th lowest. As the Prime Minister also pointed out, the lion’s share of the increase in petrol prices in the last year is due to the pre-tax cost, not Government revenue measures.

Hon Paul Goldsmith: So was the Prime Minister’s summation wrong?

Hon PHIL TWYFORD: The Prime Minister’s summation was correct.

Hon Paul Goldsmith: So is he proud that his Government is collecting at least an extra 10c a litre outside of Auckland and more than 20c a litre in Auckland at a time when households are already under pressure?

Hon PHIL TWYFORD: I’m proud that this Government is making the investments that the country desperately needs. In Auckland, to get the city moving, we’re addressing the infrastructure deficit that we inherited after nine years of neglect. We’re investing in safety, more than any other Government in New Zealand history, we’re building modern public transport systems, and we’re investing in the rail network. This Government is making the decisions to support economic growth for this country by investing in transport infrastructure.

Hon Paul Goldsmith: So why is he not prepared to accept that the Government-legislated Auckland regional fuel tax has not added extra costs to New Zealanders and their motoring?

Hon PHIL TWYFORD: I just reject the premise of the member’s question.

Hon Paul Goldsmith: Why does he not consider using other Government funds for significant transport infrastructure, as the previous Government did with the City Rail Link, rather than adding new taxes?

Hon PHIL TWYFORD: Well, I did note that the Opposition has called for an abandonment of the fuel excise and the use of one year’s budget surplus. I would point out to the member that since 1927, fuel excise has been the main funding source for transport, and since the last Labour Government, it has been fully hypothecated. Every single dollar raised by the fuel excise and road-user charges goes into investment in the transport system. It has provided a stable and dependable source of funding that was utilised very effectively when Simon Bridges was the Minister of Transport. Under that party when they were in office, six excise increases—17c, excluding GST—were added.

Hon Paul Goldsmith: I raise a point of order, Mr Speaker. The Minister is giving a speech on a totally unrelated topic—[Interruption]

SPEAKER: Order! It’s a point of order.

Hon Paul Goldsmith: I asked him why he did not consider using other Government funds for significant transport infrastructure, and he’s talking about something that the previous Government did with its fuel excise.

SPEAKER: Well, I think the Minister was talking about precedent, and I think that’s fair. Does the Minister want to continue? Is there a supplementary?

Question No. 7—Education

7. Hon NIKKI KAYE (National—Auckland Central) to the Minister of Education: Has the Government made a decision to rule out an increase in the pay offer for secondary or primary school teachers in the current collective bargaining negotiations?

Hon CHRIS HIPKINS (Minister of Education): The Ministry of Education is continuing to negotiate with the NZEI and the Post Primary Teachers Association (PPTA), and, as the former Minister I’m sure is aware, it would be inappropriate to comment on the ministry’s bargaining mandate.

Hon Nikki Kaye: Does he agree with the Ministry of Education’s decision to refuse to provide the financial breakdown of offers, despite NZEI and PPTA asking for this information on behalf of their 40,000 teachers?

Hon CHRIS HIPKINS: I reject the assertion in the question. That information is published on the Ministry of Education’s website.

Hon Nikki Kaye: Does he agree with the decision by this Government to spend $191 million of surplus funds on diplomats, such as New Zealand’s embassy in Stockholm, rather than additional teacher pay?

Rt Hon Winston Peters: How narrow and stupid is that?

SPEAKER: Order! Order!

Rt Hon Winston Peters: Ridiculous.

SPEAKER: Order! Those decisions are not those for this Minister.

Jamie Strange: Does he still consider that the current offer to NZEI was a good offer, and if so, why?

Hon CHRIS HIPKINS: Yes, I do. The current offer to NZEI, the primary school teachers, would result in a $7,043 increase to the top step, which is the step that most primary school teachers are on. To put that into contrast, the last three agreements put together resulted in an increase to the top step of $6,969—less than the amount that’s being offered in one agreement.

Hon Nikki Kaye: Does he accept that the additional funds through collective bargaining to resolve teacher shortages, given the Ministry of Education numbers alone indicate that over the coming years there could be a shortage of more than 4,000 teachers?

Hon CHRIS HIPKINS: The shortage that we inherited is very concerning, and it is an indictment on the track record of the previous Government that they cut funding for teacher-supply initiates, and that is the mess that we are cleaning up. With regard to the current teaching workforce, actually, retention rates are exceptionally high. The issue is that we haven’t been training enough teachers because there was a 40 percent reduction in the number of teachers being trained under the previous Government.

Hon Nikki Kaye: Mr Speaker, supplementary question.

Rt Hon Winston Peters: Mr Speaker, supplementary question.

SPEAKER: Nikki Kaye.

Rt Hon Winston Peters: Call her.

Hon Nikki Kaye: With inflation out today at 1.9 percent, what does he say to the secondary school teachers who’ve been offered 2 percent, given $5.5 billion surpluses, and are being told by the Prime Minister, “No more cash.”?

Hon CHRIS HIPKINS: Pay is not the only issue that teachers are negotiating about; they’re also negotiating about working conditions. In fact, the 2 percent is only for some of the secondary teachers. There is a range of percentage increases, and the 2 percent in the middle doesn’t take into account the fact that many of those teachers will move on the salary band as well.

Rt Hon Winston Peters: Supplementary question.

SPEAKER: The Rt Hon Winston Peters. I want to assure the member that he is noticeable and I do see him.

Rt Hon Winston Peters: Well, yes, but it goes that way and this way, and it goes on seniority. I don’t want to push the point.

SPEAKER: No, no, no. It goes on who I call—

Rt Hon Winston Peters: No, not quite. No, sir, it goes on precedent.

SPEAKER: I assure the member that the Standing Orders and Speakers’ rulings are very clear: the decision who to take for supplementaries is mine and mine alone. This time I call him.

Rt Hon Winston Peters: For a teacher to enter the teaching force in 2019, when would that teacher have had to enter the teaching training college to get skilled and qualified, and how many short were we back in 2016?

Hon CHRIS HIPKINS: There was a 40 percent reduction over the last decade in the number of people entering and completing initial teacher education. It is at least one year of specific teacher training to become a registered teacher. For some it is up to three years of training, depending on the qualification that they are doing.

Hon Nikki Kaye: Can he confirm he’s been advised of planned rolling strikes in November for primary school teachers and the potential of other strikes for secondary early next year, and at what point will he take any responsibility for no settlement?

Hon CHRIS HIPKINS: In answer to the first part of the question: no, because the NZEI are balloting their members and they cannot notify us until the ballot has been conducted. Generally that’s the way of things in a democratic system—you wait for the outcome before you notify people of the result. With regard to the secondary teachers—the secondary teachers have been very clear in their commitment to negotiating with the Government, and that industrial action would be a last resort. So with regard to accepting responsibility for the problem, I do accept responsibility for cleaning up the mess that I inherited from that previous Minister and her Government.

Question No. 8—Commerce and Consumer Affairs

8. ANAHILA KANONGATA’A-SUISUIKI (Labour) to the Minister of Commerce and Consumer Affairs: What recent announcements has he made on reforms to the Credit Contracts and Consumer Finance Act 2003?

Hon KRIS FAAFOI (Minister of Commerce and Consumer Affairs): Fakalofa lahi atu, Mr Speaker. Last week, the Prime Minister and I announced the Government’s reforms to the Credit Contracts and Consumer Finance Act that will protect families from debt spirals; irresponsible, predatory lending; and harmful mobile-trading practices. The key changes we are making include interest and fees caps, a fit-and-proper-person test for high-cost lenders and door-to-door salespeople, and stronger regulation of truck shops. The coalition Government is proud to be introducing measures that will halt the worst of those preying on vulnerable Kiwis, while enabling borrowing that meets their needs in a safe and affordable way.

Anahila Kanongata’a-Suisuiki: Why were these reforms needed?

Hon KRIS FAAFOI: The amendments made by the previous Government in 2015 did not go far enough to address the harm being caused to vulnerable consumers by loan sharks and truck shops. Before—and since—becoming the Government, parties of the Government had heard from people who were trapped in insidious and crippling debt about the stress this was causing families. I’ve heard time and time again of families getting caught in vicious debt cycles through excessive interest rates, penalties, and fees. Some lenders were charging up to 800 percent annual interest, offering loans that had clearly been unaffordable, and charging excessive penalties and fees. Our reforms will protect vulnerable communities from predatory lending practices.

Anahila Kanongata’a-Suisuiki: How will these reforms contribute to the coalition Government’s long-term plan to build a modern and fairer New Zealand?

Hon KRIS FAAFOI: The Government is committed to lifting the incomes of families and reducing child poverty. Protecting families from predatory lending will prevent debt spirals. For many families, this is key to realising the Government’s goals and reducing harm for those families. It is estimated that more than 200,000 borrowers use high-cost credit every year. This means too many New Zealanders are struggling to make ends meet, leading them to take out small high-interest loans that can create huge debt spirals for them and their families. These reforms sit alongside the work the Government is already doing to boost incomes through the Families Package, winter energy payment, increases to the minimum wage, extending paid parental leave, and other measures to make our country the best place to raise a child.

Question No. 9—Health

9. Hon MICHAEL WOODHOUSE (National) to the Minister of Health: Is he satisfied that the medicines funding provided for in Budget 2018 contributes to ensuring all Kiwis get world-class cancer treatment?

Hon Dr DAVID CLARK (Minister of Health): Mr Speaker, fakalofa lahi atu. Budget 2018 included a record $985 million for the combined pharmaceuticals Budget. I’m advised that, for each of the last two years, spending on cancer drugs exceeded $200 million, and that figure will continue to increase as more medicines become funded and more patients access new treatments. It is completely understandable, in my view, that people suffering from cancer want access to the latest treatments. There is rising demand for cancer medications, and there will always be pressure to fund more drugs. Decisions on which drugs to fund are, rightly, left to the experts at Pharmac. Pharmac is a world-leading funding model which allows more New Zealanders to get access to more drugs at lower costs than would otherwise be the case.

Hon Michael Woodhouse: Isn’t it true that Budget 2018 provided not a single dollar of extra funding for new medicines and, indeed, was reduced by $200 million?

Hon Dr DAVID CLARK: By its very nature, the Pharmac model delivers savings. As drugs come off patent and generic options become available, money is freed up, allowing Pharmac to buy more drugs. The Pharmac savings identified in Budget 2018 will be kept within Vote Health. This will be used to deliver better health outcomes for Kiwis.

Hon Michael Woodhouse: Has he spoken with any officials about the $200 million in reprioritised funds in Budget 2018 being redirected to nurses’ pay increases rather than the purchase of new medicines?

Hon Dr DAVID CLARK: There have been numerous discussions about different issues and where savings might be used. It is my understanding that the district health boards (DHBs) have the autonomy to spend that money, and they make the decision on where it goes. The issue is health funding and making sure that the money is retained within Vote Health to deliver better outcomes for New Zealanders.

Hon Michael Woodhouse: I raise a point of order, Mr Speaker. The question was very specific about whether he has had a conversation about the reprioritised funds being used for nurses’ salaries specifically, and that wasn’t addressed.

SPEAKER: I think, in the two parts, the Minister answered it. He said, in part one, that there’d been numerous discussions and, in part two, that the DHBs had the discretion to do it.

Hon Michael Woodhouse: Speaking to that point, there was only one part to the question—

SPEAKER: No—and two parts to the answer.

Anahila Kanongata’a-Suisuiki: Why is it important to protect the independence of Pharmac?

Hon Dr DAVID CLARK: Drug funding decisions should not be made at the whim of politicians. They need to be based on good evidence and expert clinical advice. We don’t want to make drug funding decisions into a political football—for example, I agree with the commentator who responded to a question about whether it was right to override Pharmac and extend the funding of Herceptin from a nine-week programme to 52 weeks: “I don’t think it was, actually, and I think history has shown that.” The comment, of course, was made by my predecessor in the health role, National’s Jonathan Coleman.

Hon Michael Woodhouse: Did he speak with any officials about the $200 million in reprioritised funds being redirected to nurses’ salary increases rather than the purchase of new medicines?

Hon Dr DAVID CLARK: I don’t have that detail with me today. I’ve certainly had conversations with people in my office, and I’d want to check whether that was an accurate representation of them. We did talk about different places the savings could be directed and where New Zealanders would see the best value in the health system from those savings.

Hon Michael Woodhouse: Is he aware of any briefings, aides-mémoire, or other documents that reference recommendations that the reprioritised funds be used for salary increases for nurses?

Hon Dr DAVID CLARK: I will have to check that because, as I say, I can recall having conversations about the savings, as I’ve noted in my previous answers, and I’d want to give the member an accurate response to that question.

Hon Michael Woodhouse: Will he heed the petition of Terre Nicholson, supported by 36,000 other New Zealanders online, for the funding of Ibrance and Kadcyla, both effective in extending the lives of women with advanced breast cancer?

Hon Dr DAVID CLARK: My understanding is that Pharmac do have a process under way to look at Ibrance and the other relevant drug the member just mentioned. They’re in a process now for assessment for funding.

Question No. 10—Energy and Resources

DAVID SEYMOUR (Leader—ACT): I raise a point of order, Mr Speaker. This question was put down to the Prime Minister, who transferred it to the Minister of Energy and Resources, who appears to be unavailable—

SPEAKER: And the member knows—is the member seeking to withdraw the question?

DAVID SEYMOUR: No, I’m seeking leave to ask it of the Prime Minister in light of the Minister of Energy and Resources’ absence.

SPEAKER: Previous Speakers have not allowed that leave to be sought.

10. DAVID SEYMOUR (Leader—ACT) to the Minister of Energy and Resources: What effect, if any, will Genesis Energy’s plans to import coal due to a shortage of gas have on carbon emissions?

Hon DAVID PARKER (Acting Minister of Energy and Resources): It is not yet clear whether Genesis Energy will import any coal. It is acting responsibly by planning for that contingency should it be necessary. This is not caused by a shortage of gas reserves; the main driver is pipeline faults and planned maintenance. We do not expect this to have any significant long-term impact on carbon emissions. Of course, the best long-term answer to carbon emissions is more renewables.

David Seymour: Is the Minister saying that the Government is indifferent from an emissions perspective as to whether electricity is generated with coal or gas?

Hon DAVID PARKER: No.

David Seymour: Then can the Minister think of any other policies his Government has that might lead to a shortage of gas in the future and perhaps a little bit more burning of coal to generate electricity?

Hon DAVID PARKER: I would say to the member, “I can smell the carbon on your breath.”

Question No. 11—Agriculture

11. GARETH HUGHES (Green) to the Minister of Agriculture: Will he ban calf roping at rodeos, in light of yesterday’s National Animal Welfare Advisory Committee’s report that agreed “neck pain and injury from lassoing was the key issue” with calf roping?

Hon STUART NASH (Minister of Police) on behalf of the Minister of Agriculture: Fakalofa lahi atu, Mr Speaker. On behalf of the Minister, two expert committees—the National Animal Welfare Advisory Committee (NAWAC) and the National Animal Ethics Advisory Committee—were independently established under the Animal Welfare Act to provide advice on animal welfare matters. This ensures the advice the Government receives is independent, trusted, and informed by science and good practice. The National Animal Welfare Advisory Committee’s rodeo report released yesterday looked into the seven rodeo events and found some areas of animal welfare that could be improved under the current regulatory system. As a result of the report, rodeo organisers with the SPCA, the New Zealand Veterinary Association, and the Ministry of Primary Industries (MPI) will establish an animal welfare committee to provide better oversight of rodeos. Their work will include considering the modification of events and equipment to improve animal welfare.

Gareth Hughes: Does the Minister agree with the 2017 Labour Party position to ban flank straps and the use of calves under 12 months old at rodeos?

Hon STUART NASH: On behalf of the Minister, under this coalition Government just last month there was a change to the regulation that states that equipment such as flank straps can’t cause injury. We are working with the experts to ensure that animal welfare is to the fore.

Gareth Hughes: What will the Minister do to protect calves—some as young as three months old—who are chased, lassoed, jerked off their feet violently by their necks, and wrestled to the ground, when the report says the physical pain from this persists after the event?

Hon STUART NASH: On behalf of the Minister, the independent NAWAC report calls for greater research into alternatives to mitigate risks for animals at rodeos—for example, using alternative equipment. NAWAC has asked for closer assessment of animals in the 48- to 72-hour period after rodeos so we have a better understanding of any injuries caused. The committee established to consider these issues includes vets, animal welfare experts, and MPI. It’s important that we work together to find solutions to animal welfare issues.

Gareth Hughes: On that point, with the rodeo season about to start, will he at the very least pick up the report’s recommendations and regulate to ensure that less dangerous bungy cords are used on calves instead of rope lassos?

Hon STUART NASH: On behalf of the Minister, rodeos must follow the welfare code, and the Ministry for Primary Industries and SPCA inspectors monitor compliance. It is paramount that New Zealand has the highest standards of animal welfare across all areas of our economy and society. Animal cruelty is unacceptable, and those who break the rules can expect to be fined or prosecuted under the Animal Welfare Act 1999 and its regulations. As mentioned previously, the animal welfare committee will work to include the modification of events and equipment to improve animal welfare.

Gareth Hughes: Following on from the Minister’s answer, is he really comfortable outsourcing animal welfare changes to the rodeos and to the cowboys association, and seeing continuing pain inflicted on animals for entertainment?

Hon STUART NASH: On behalf of the Minister, I depend on the independent scientific advice from NAWAC, and I thank them for their work. The rodeo welfare committee includes experts from vets, the SPCA, and MPI, so I’m confident it will be balanced in its work.

Question No. 12—Energy and Resources

12. JONATHAN YOUNG (National—New Plymouth) to the Minister of Energy and Resources: Has she seen reports that the wholesale price of electricity reached a peak of $192/MWh on 6 October because of low hydro levels and the continued outage of the Pohokura gas field?

Hon DAVID PARKER (Acting Minister of energy and Resources) on behalf of the Minister of Energy and Resources: Yes. But that peak of $192/MWh is considerably lower than the peak of $9,145.57/MWh in 2014. I’m further advised that this much, much lower figure of a peak of $192/MWh is mainly to do with constraints in the gas supply system and has nothing to do with gas reserves.

Jonathan Young: How long will New Zealanders be faced with higher electricity prices because of the Pohokura field being offline and when the Kupe gas production plant goes into planned maintenance later this month?

Hon DAVID PARKER: I’m advised by officials that the problems with the pipeline are expected to be remedied within about four weeks.

Jonathan Young: So will burning coal rather than natural gas, because of gas supply restrictions, increase or decrease greenhouse gas emissions?

Hon DAVID PARKER: I suspect I could say “Rhubarb, rhubarb, rhubarb.” today and it wouldn’t be reported, but I know that the Speaker wouldn’t approve of that and I like to take questions seriously. I’ve already answered that question in an earlier answer to Mr Seymour. Perhaps the member could review that answer.

Jonathan Young: I raise a point of order, Mr Speaker. I couldn’t have made the question more simpler for the member to answer, and surely—

SPEAKER: “More simpler”? Try again. It’s either “simpler” or “more simple”.

Jonathan Young: Thank you. Will burning coal rather than natural gas, caused by gas supply shortages, increase or decrease greenhouse gas emissions?

Hon DAVID PARKER: I’m very happy to repeat the answer that I gave to Mr Seymour: it’s not yet clear whether Genesis will import any coal, it’s not yet clear whether it will burn any additional coal, and it’s not yet clear that the gas constraints will cause that; what is clear is that New Zealand has a secure electricity system. We have—I think it’s the second-highest; no, the third-highest rate of renewable electricity in the OECD. Notwithstanding that, last week, the World Energy Council ranked New Zealand eighth in the world—the only non-European country in the top 10—for energy security, energy equity, and environmental sustainability.

Jonathan Young: I raise a point of order, Mr Speaker. I cannot think of a more simpler question—a more simple question—for such a complex and long answer.

David Seymour: Speaking to the point of order—

SPEAKER: Well, there isn’t one.

David Seymour: Well, on reflection, sir, he didn’t answer it when I asked it, either.

SPEAKER: Well, the member is far too late, again. Is there a further supplementary?

Jonathan Young: Does she remain in disagreement with official advice that a restricted natural gas supply may result in increases in electricity prices and a greenhouse gas emission increase?

Hon DAVID PARKER: I have—I’m not sure whether it’s the advantage or disadvantage of having been Minister of Energy back in 2007-08, when the member’s predecessor, the Hon Gerry Brownlee, also said that more renewables and—

Jonathan Young: I raise a point of order, Mr Speaker. He’s miles away from addressing the question.

SPEAKER: Order! I live in hope that he might get there.

Hon DAVID PARKER: —when his predecessor also alleged that you need more thermal for security of supply. Obviously, if you burn more coal, then you have higher emissions. We don’t—

Hon Members: Hooray!

Hon DAVID PARKER: Ha, ha! But, unlike the other side, we actually think the answer to that proposition is more renewables, not more thermal.

Jonathan Young: What is the Minister’s plan to resolve the looming energy price increases in New Zealand now that she is about to ban new offshore exploration permits?

Hon DAVID PARKER: Again, the Opposition often cries that additional renewables would put up prices. That hasn’t been the experience in New Zealand. Actually, if energy companies thought it was cheaper to build more thermal generation, they would do it. Instead, they choose to build more renewables because it’s cost-competitive.

Sittings of the House

Sittings of the House

Hon CHRIS HIPKINS (Leader of the House): I move, That the sitting of the House today be extended into tomorrow morning for consideration in committee of the Education Amendment Bill, the first reading of the Criminal Cases Review Commission Bill, consideration in committee of the Telecommunications (New Regulatory Framework) Amendment Bill, the Courts Matters Bill, and the Tribunals Powers and Procedures Legislation Bill.

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

Ayes 63

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

Noes 56

New Zealand National 55; ACT New Zealand 1.

Motion agreed to.

Bills

Commerce Amendment Bill

Second Reading

Hon KRIS FAAFOI (Minister of Commerce and Consumer Affairs): I move, That the Commerce Amendment Bill be now read a second time.

The Commerce Amendment Bill amends the Commerce Act 1986 and deals with three important issues to enhance the operation of New Zealand’s competition regime. These three issues are market studies, or competition studies as they are referred to in the bill; secondly, the regulation of specified airport services; and, finally, alternative enforcement mechanisms used by the Commerce Commission.

The Commerce Amendment Bill was introduced into this House on 28 March this year and was referred to the Transport and Infrastructure Committee for consideration on 1 May 2018. The committee received 24 submissions from interested groups and individuals and heard oral evidence from 10 submitters. I wish to thank members of the committee for their consideration of this bill and, in particular, the chairperson, Darroch Ball, for ensuring that the bill was reported back in such a timely manner.

The committee members have carefully considered a range of technical issues raised in submissions. It is unfortunate that the committee was not able to reach a consensus on all of these matters raised, but by majority it has recommended some very useful amendments which will improve the operation of the bill. So I thank those members for their work.

I will now briefly turn to some key issues in the bill as reported back. In terms of market studies, the ability for the Commerce Commission to undertake market or competition studies is a key element of this bill. Market studies are in-depth studies into whether competition in a market is working effectively and, if not, why not. Unlike an enforcement investigation, the Commerce Commission may look into the structure and performance of the market itself and, if required, make recommendations on how it could work better. The bill includes a non-exhaustive list of types of recommendation the commission may make. These market studies have the potential to identify opportunities for significantly improving market outcomes for consumers and businesses. Healthy competition in markets improves affordability of goods and services for consumers and promotes innovation and productivity for businesses.

An important feature of this bill as introduced is that it provides that both the responsible Minister and the Commerce Commission can initiate a market study. I see the ability of the Commerce Commission to initiate a market study as being critical to maintaining the integrity of the regime. It enables the politics to be removed from the decision on which markets to study. This is particularly important if a Government is active in the relevant market, either in a regulatory capacity or through its trading activities.

The committee, by majority, has also recommended that the responsible Minister should have to publicly respond to a Commerce Commission final report on a market study, and I welcome this change. The Government should be required to state its views on the commission’s findings and what steps it proposes to take in response to any recommendations. It adds to Government transparency and the integrity of the regime.

A further issue in the bill is measures to strengthen economic regulation of airports. The Commerce Commission currently has a programme of work under way to assess the latest price resets by the three major international airports. This bill does not directly affect that work. Rather, it provides that in the event that the Commerce Commission identifies that the current information disclosure regime is not working effectively, there is a statutory process for determining whether further regulation is desirable—that is, it provides a regulatory backstop.

The committee, by majority, has recommended minor changes to the bill. First, the majority recommends making it clear that if an inquiry is initiated into whether further services provided by the three major airport companies should be regulated, the Commerce Commission must consider the costs and benefits of imposing regulation on that service and market power of those airports. Secondly, the majority recommends clarifying that a new airport company may become subject to regulation under the Commerce Act following a full inquiry by the Commerce Commission.

I support these changes. The amendments in this bill will strengthen the regulatory regime to better protect users of airport services from misuse of market power by airport companies. These changes should impose no direct costs on the airport companies if they’re operating consistently with the purposes of the current regime.

Finally, the bill amends the Commerce Act to also allow the Commerce Commission to accept enforceable undertakings to resolve enforcement cases. This mechanism is a cost-effective and timely means to stop anti-competitive conduct and, if desirable, remedy any harm to competition. The committee has recommended amendments to make clear the matters that may be included in an enforceable undertaking, including when the Commerce Commission is investigating a potentially anti-competitive merger. These are very useful clarifications.

In conclusion, passing this bill will enhance New Zealand’s competition regime and protect the well-being of consumers and businesses. I commend the Commerce Amendment Bill to the House.

BRETT HUDSON (National): Thank you, Madam Assistant Speaker. It’s a pleasure to rise and speak on this bill in the second reading. Although not a permanent member of the Transport and Infrastructure Committee, I was fortunate to be able to substitute on for all of the business on the scrutiny of this bill, so I was able to hear from the submitters and I had the opportunity to ask some questions. The bill has been returned with some amendments, but there are problems that persist with it that we sought in the select committee to rationally set out to Government members of the committee and reach agreement on. Unfortunately, that could not be attained.

I particularly want to start in the area of market studies. The Minister introducing this second reading, Kris Faafoi, did point out that the market studies provisions will permit the responsible Minister to initiate a market study, or competition study, or the Commerce Commission to self-initiate. It was that self-initiation that we presented as an issue. Actually, prior to the last election, the National-led Government had endorsed pretty much this bill, certainly in terms of market studies. We had made a Cabinet process to place the fundamentals of those into legislation. But the point of difference was that that then National-led Government believed that such studies should be ministerial-initiated only, not self-initiated.

The Minister today and previously has justified those provisions on the basis that allowing the Commerce Commission to self-initiate market studies takes the politics out of those competition studies. Well, that’s remarkable, really, because last week, firstly, the Prime Minister on two occasions, and then Mr Hughes—one of his governing partners in a confidence and supply agreement—put the politics right back into them by stating that, first, they are going to put this bill through the House in some haste, and it’s yet to be determined if that also translates into parliamentary urgency, but urgency was the word the Prime Minister used. This bill would pass through its remaining stages in some haste so they could hasten a market study into fuel pricing in New Zealand.

The Prime Minister then went on to say the next day that the next cab off the rank could possibly be a study into supermarkets, and then Mr Hughes reiterated that call. So, I would argue, so much for the line that politics will be taken out of competition studies and competition regulation in the New Zealand marketplace under this bill.

What those comments, and, in fact, the Minister’s own comments as this bill went through select committee, showed is that we’re now looking at some haste for legislation that the Government doesn’t understand what it’s actually legislating for. In particular, the Minister, in the Estimates hearings, as this bill had entered select committee, stated in evidence that a market study would be expected on average to cost approximately $400,000. So he felt—and he said under evidence—that there should be enough in the previous Budget to permit about three, maybe up to four, of these studies a year.

Well, that’s quite remarkable, because in its oral submission the Commerce Commission made it absolutely clear to the select committee that the budget allowance of $1.5 million a year for these competition studies, as the Commerce Commission prefers to term them, would permit one study to be undertaken a year. They made it very clear that there would be no change to be expected out of a million dollars for each study, and they expected that there would be no more than one able to be afforded per year. But we have a responsible Minister that believes that three or even four of them could be done for that same budget.

Now, what that indicates is that the Minister’s brought a bill to the House and into select committee without actually talking to his officials about what the scope and implications of these studies are. They are clearly much larger, more expensive, and have more imposition on the businesses affected than the Minister is aware of, and, in fact, the Prime Minister made it clear in her comments around the fuel price inquiry she wants to set into motion quickly that they’ll be able to report back early in 2019. Again, the Commerce Commission made it very clear that these studies are comprehensive studies. They take a great deal of time. In fact, we can anticipate that each study would take the best part of a year to complete.

The Commerce Commission also made it clear in their submission that in order for a market study or a competition study to be just that, it requires broad participation, broad inquiry. So whereas the Minister responsible, in his evidence, again in Estimates, indicated that, perhaps, you know, you could talk to a couple of participants, the Commerce Commission were very clear under questioning that, actually, a market study requires a very, very broad look at a market, across a range of businesses, not just, for instance, in this fuel price inquiry, a couple or all of the major oil providers, or the likes of Z Energy but, indeed, across the range of fuel service vendors in New Zealand.

Remarkably, the Auckland business chamber informed us just recently—last week—that of the 1,500 service stations across New Zealand over 1,200 of them are fundamentally small business, or what we might call mum and pop operations. Now, the Commerce Commission made it absolutely clear that in order to be a competition study it is going to have to look at that breadth across the market. So what they are going to impose, through hastening this legislation, is an inquiry process that will take the best part of a year, that will look at a really broad range of business, and, in doing so, because the market studies have compulsory data acquisition powers, they are going to require small businesses to furnish the same sort of information in the same format to the same extent as they will require of the very largest businesses.

It is evidence that the Government does not understand the scope and the cost impost across small as well as large businesses that their legislation will impose. That is why it’s an absolute travesty that they refuse to listen to rational argument that the best way to manage this would be to limit the use of these powers, particularly the ability to compel businesses to provide data in specific formats and extents to that which has been either initiated at a ministerial level or endorsed by the responsible Minister.

By the way, look, if they really want to get a fuel inquiry under way, we’d be pretty happy to help with this. But, really, if they want do a fuel inquiry and it’s going to take a year, if they really want to be a kind and caring Government as they claim, the best way they can help New Zealanders tomorrow is simply by axing the tax that they’ve just put on—the recent excise and the regional fuel tax. Indicators in the Auckland market are showing that competitive pressures there are driving cost prices down, which, effectively, sees some of that recovered from outside of the Auckland region so that the impost of that regional fuel tax is in effect—not in reality, but in effect—being felt across broader parts of New Zealand.

But we do acknowledge that doing that inquiry is better than doing nothing. It is going to take too long. Every day that that inquiry goes on, New Zealanders are going to feel the pinch in their back pockets because of the taxes that are imposed on them as well as other global supply and exchange pressures. But at least it will be doing something along the way to help, so we are of a mind to want to offer our support to get that under way.

Before I finish, I would like to just touch on a couple of the other areas of the bill. The airport regulation—actually, before I just move on to the airport regulation, I intend to put a Supplementary Order Paper (SOP) in during the committee stage, which I call on the Government to support. It’s going to be a very simple SOP. It is simply going to require that where the Commerce Commission self-initiates a competition study, it will require ministerial approval. I call on the Government to support that, because it would bring us in line with the Australian Competition and Consumer Commission (ACCC). In Australia, market studies don’t have the ability to compel businesses to provide data; it is a voluntary data provision only. Where the ACCC is able to exercise powers of compulsion in the acquisition of data, they require ministerial approval, even when they’re self-initiated by the ACCC. So there’s a good reason there for the Government to keep us in sync, in harmony, with the regulatory practice in Australia. So I call on the Minister of Commerce and Consumer Affairs to support that SOP in the next stage.

But on the airport regulation, I’ll acknowledge that officials made some changes which made those provisions much more palatable, but they still didn’t meet the threshold of proving why the change was actually needed in the first place. We would like to see this inquiry get under way. We want to ease back pockets for Kiwis. We will support this bill and at second reading.

MICHAEL WOOD (Labour—Mt Roskill): I am very happy today to stand in support of the Commerce Amendment Bill, and I’d like to start by just acknowledging and congratulating our Minister of Commerce and Consumer Affairs, the Hon Kris Faafoi, for taking decisive action on this issue. I’m pleased to support this bill, because this coalition Government is on the side of Kiwi consumers, on the side of honest businesses, and on the side of functional markets. We are not going to make excuses for failures in those areas as the last speaker, Brett Hudson, and as the last Government did.

A good starting point, if we want to think about this bill, is a report—a very good piece of work—that was in fact done by the Hon Judith Collins in her stint as the Minister of Energy and Resources in the previous Government. What did that report tell us, which was published in 2017? It told us at that point, after she commissioned that report into activities in the consumer fuel market, that at that time, Kiwis suffered the highest pre-tax fuel prices in the OECD. That was back in 2017. That same report told us that there was not sufficient evidence to tell us that there was not a degree of collusion and inappropriate activity across our fuel markets.

When that previous Minister commissioned that report into retail fuel prices, two of the major players in the market refused to cooperate with the Commerce Commission, and that is why this Government and this Minister have taken decisive action. When Kiwis are being ripped off at the pump and potentially being ripped off in other markets, we’re not going to sit back and just let those major players rip-off those consumers and refuse to cooperate with the Commerce Commission. That’s what they did. When that previous Minister, who was one of the tougher Ministers in that previous Government—when they asked for information, those companies refused to cooperate with a study instigated by the Commerce Commission. We’re not going to allow that situation to carry on, and that is what this piece of legislation turns around.

It will ensure that when we undertake market studies into areas where we have a concern that consumers may not be treated fairly—we believe that market powers may be being abused—it will ensure that those companies have to cooperate and have to provide the same information. It will also ensure that the Commerce Commission has the ability to act and to self-initiate those studies. I have to say that the previous speaker, Brett Hudson, and the Opposition in their minority view in opposing this bill make a great play of believing that the process should be depoliticised and are having a go at the Government when they claim that we’re not acting in accordance with that idea, but then they’re opposing the idea that the Commerce Commission has the ability to self-initiate—so which one actually is it?

This bill gives the Commerce Commission the ability to self-initiate so that it can use its expertise and its judgment to carefully initiate studies where they might be required. I might say that in the future unfortunate event where we have another weak National Party Minister holding that portfolio, New Zealand consumers will be very pleased that the commission has the ability to act if a future Government does not.

In the House today, we have seen the Opposition turn from lions to lambs. In question time we heard no end of concern about fuel prices, and I think some of that noise might have been to make up for noise that they don’t want heard in other places. But now they are lambs on that issue, when it comes to this piece of legislation. This is a piece of legislation that actually gives us the capacity, if we look at places like the fuel market, to delve into why it is that Kiwi consumers have amongst the highest pre-tax prices in the OECD. And let’s remember, that was something that we came to understand back in 2017 when that Government first started looking into this issue. The difference is that this Government is actually prepared to do something about it.

One of the most important things to remember, as well, is that what we have when market studies are conducted is an ability for the Commerce Commission to make recommendations back to the Minister to actually take some action. Once again, over nine years under that previous Government—we had a study at the end, but we had no action on these issues.

Hon Dr Nick Smith: Fuel prices only went up by 1 percent per year.

MICHAEL WOOD: What we know, Mr Smith, as per that report, is that we had the highest pre-tax prices in the OECD at the end of that previous Government’s term.

One of the bits of scaremongering that happened in amongst the Opposition’s arguments against this bill was the suggestion that it was inappropriate for the Commerce Commission to have the ability to self-initiate. What is important to understand about this bill is that it gives the Commerce Commission, when it produces a market report, the ability to make recommendations which do go back to the Minister and do go back to the political process in order to make changes, if changes are justified. So that’s an important safeguard that I think is important for the House to be aware of.

The Transport and Infrastructure Committee considered this bill very carefully, considered the submissions carefully, and has made, I think, some very sensible changes, including, for example, the requirement for the Minister, within a certain amount of time, to give a response to any market study that is produced.

I’m absolutely convinced that Kiwi consumers are going to welcome this bill. As I said at the beginning of my comments, this is a Government which is on the side of Kiwi consumers, on the side of fair competition, on the side of good and ethical businesses, and this bill will support those outcomes. Thank you, Madam Assistant Speaker.

Hon JUDITH COLLINS (National—Papakura): Thank you, Madam Assistant Speaker. It’s a pleasure to speak in support of this bill. I think it’s quite interesting—we’ve had a few comments from the member who’s just resumed his seat, Michael Wood, about what was done last year in relation to fuel prices. Certainly, last year, for about ten months, I was privileged to be the Minister of Energy and Resources, and I really enjoyed getting stuck into an area, particularly around fuel supply—

Chris Bishop: Very good Minister.

Hon JUDITH COLLINS: —and security of supply, but also around—thank you very much, Chris Bishop. I almost said the Hon Chris Bishop, but that’s because I’m thinking ahead.

I think one of the issues, really, that struck me, was that the industry itself is quite challenged in some ways. And a lot of what’s around fuel prices is around the fact that we have three major suppliers that control and own the Marsden Point refinery, and that competition is primarily served or given to New Zealand from Gull, which imports its fuel already refined from Australia, and that even some of the smaller players like Waitomo Group and Allied Petroleum, some of the very small players who are often significantly cheaper than the big suppliers of fuel domestically, actually buy their domestic fuel from the big suppliers—and I always find it stunning that they can do that and still be able to sell it cheaper. So it was an area that I took very seriously.

I discussed the matter with my parliamentary colleague, now the Hon Stuart Nash, and he told me what his concerns were. He was a spokesman for the Labour Party at the time. We looked at the issue, I took it to the caucus and to Cabinet, and we agreed that we would have a survey done by the Ministry of Business, Innovation and Employment (MBIE) around the price margins and what was happening in the fuel supply, but also the cost to consumers. As soon as that survey was announced, the price of fuel came down. It was quite stunning. I don’t know whether or not it was as a consequence, but it was certainly noticeable. On the other hand, this year, when the Hon Megan Woods called the fuel companies in to give them a dressing down, the price went up, but I think that could be something to do with what happened in that room—who knows. Anyway, the main thing, I think, is that we took this issue very seriously.

We were also concerned around the ability of MBIE to get all of the advice and information that it needed from the fuel companies. So, to put it on the record: Mobil would not provide us with all of the information required by the people who were undertaking the work. Even though I went to see Mobil in Houston actually, at their head office, for various reasons, and discussed this with them, they would not provide that. Gull would not provide it either, and that was, they said, because they were in a sale from a private family to Caltex Australia. The companies that did provide full information as requested were Z Energy and BP. I think it’s good to put on record who provided the information.

We got a result back from MBIE and it said that basically it looked like there was cause for concern around those prices. I took this issue, along with my colleague the Hon Jacqui Dean, who was at that stage the Minister of Commerce and Consumer Affairs, the role that the Hon Kris Faafoi has now—and why that man has not been put in Cabinet I do not know, other than that he’s not a woman. What we did was we took that to Cabinet, and Cabinet agreed that we would give the Commerce Commission extra powers to undertake the market research and surveys that the Commerce Commission had been asking for, but we would limit it to areas where there was a ministerial or Cabinet direction to the Commerce Commission to undertake those, sort of, market study powers. The reason for that is that the market study power provision is extraordinarily costly to an industry and extraordinarily pervasive. If you bear in mind that the Commerce Commission also agreed to the sale of Caltex to Z at one stage, and therefore people would say that it was involved in actually making the market less competitive, you’d have to wonder sometimes at some of those decisions.

Anyway, the main thing is that this power is something that we think should be reserved for Cabinet to ask the Commerce Commission, or the Minister to ask the Commerce Commission, to look at these areas, because we should not underestimate how debilitating the cost and the time involved in complying with requests from the Commerce Commission can be. We’ve certainly seen that in Australia, and we took note of some of the issues that Australians had found with the Australian Competition and Consumer Commission, the ACCC, as they call it there, which can be extraordinarily difficult for anybody to comply with but also can go on for a very long period of time. What sometimes, I think, regulators and those in politics who’ve never been in business tend to forget is that every time there’s a cost imposed on an industry, the consumer ultimately ends up paying. It’s all very well to think, “Well, business can pay for it.” Well, business actually is there to make a profit too and they will pass that on in some way, in some form, at some time, to the consumer. So you’ve got to be very careful with this, that it’s not overdone.

We are ultimately only a country of—what—4.8 million people, the best little country in the world obviously. We are bigger than the whole of the United Kingdom in surface area. We are the sixth-largest economic zone in the world, but our population is smaller than Melbourne’s. I think that when we think about that, we should be very careful about the costs that we impose on businesses and therefore on consumers.

We know that this work was done by and approved by Cabinet last year—I think, from memory, it was about July last year, and then we had this issue called an election come in, and it stopped all that work done. That work has already been done, and the Minister has been praised roundly by her colleague Michael Wood—who would be much better at the role, frankly, in my opinion, than she is—for getting on with this. Actually, she sat on it for a whole year, more than a year. She’s really done nothing with it and all she’s done is she’s come back and given in to the demands of those who want to regulate everything without understanding the cost of it.

So we have decided in the National Party that we need to support this bill because we do need to get these issues dealt with. We have seen rising petrol costs and diesel costs this year. We know that a large part of that is from the extra taxes that the Labour - New Zealand First - Greens Government have agreed to, particularly in the Auckland region with the 10c a litre plus GST—so 11.5c a litre regional fuel tax added on to everything else that Aucklanders are expected to pay. For those who are not in Auckland: don’t worry, this tax is coming to you too.

So we are very aware that the Government has only now decided to slam around the big fuel companies because it’s easier to do so rather than to address the fact that so much of our transport taxes, paid for solely by petrol buyers and diesel buyers through the road user charges, are currently paying for public transport, paying for roads, paying for, apparently, a trolley bus or a tram going up Dominion Road, paying for cycleways, paying for walkways—paying for everything. The people in my electorate of Papakura and many other electorates are not asking about the Commerce Commission’s powers to do surveys and to look at things. What they are saying to me is “Why does the Government think we’re going to be fobbed off with this when they could actually stop the regional fuel tax and axe the tax?” People are wanting to axe the tax, and I think that even though there are some good things that could come out of this legislation, ultimately it is not going to deal with the major issue that it’s being used to try and be a salve for, or even a band-aid for, which is the extra petrol taxes and diesel taxes put on by this Government.

Hon SHANE JONES (NZ First): I stand to take a short call, and I’m eminently qualified to speak on this matter as a consequence of my forays into the world of supermarket predatory pricing.

Hon Dr Nick Smith: Went nowhere.

Hon SHANE JONES: We’ve heard from Mr Nick Smith, who took $240,000 from the taxpayer to defend himself against egregious and incorrect claims pertaining to the timber industry. He needs the protection of the Commerce Commission. The Commerce Commission, through the Minister, with these expanded powers can seek to resolve some of the issues that Mr Nick Smith, who on two occasions was funded out of the taxpayer for ultimately false claims—

Hon Dr Nick Smith: Because leaky homes was a real problem.

Hon SHANE JONES: —so the less we hear from him, the better, which is why as a consequence of today’s ructions he will soon be shown the back door. But let me come back to what I learnt through the episode of Countdown. The actual Commerce Commission was unwilling, incapable of delving into the behaviour of Countdown. So I congratulate Minister Faafoi for expanding the powers, shepherding this legislation. I’m willing to acknowledge quite a bit of what Judith Collins has said: that both parties have had concerns for quite some time as to how we give the Commerce Commission enough powers to intervene in these large monolithic—or sectors of the economy where enormous power is concentrated in a limited number of players.

Now, I accept that for the last 30-odd years we’ve got a laissez-faire approach and we’ve left things really to the Darwinist tendencies of the market. But I think that the recent episode that the Prime Minister is highlighting in relation to fuel companies shows that somewhere within the State we need to endow an institution with enough power of scariness to actually cause information to be brought forward. If we leave it to individual MPs, they fall disgraced. As I’ve said, the member from Nelson suffered and required a taxpayer bailout for fear of permanent penury.

Hon Dr Nick Smith: Rubbish!

Hon SHANE JONES: That is a fact—that is a fact.

Hon Dr Nick Smith: No, it’s not.

Hon SHANE JONES: Just google it, Madam Assistant Speaker, and you will see. The member doth protest too much.

On the question of which areas this institution is likely to focus on, well, it’s pretty simple: the cost of power—that has an inordinate impact on ordinary households; the cost of fuel—yes, most certainly, and especially within the context of the transition economy; the cost of insurance—it’s a pity that the member for Nelson didn’t have insurance when he put his hand in the taxpayer’s pocket, up to $300,000, several years ago.

Hon Dr Nick Smith: Rubbish! Untrue!

ASSISTANT SPEAKER (Poto Williams): Order! Let’s come back perhaps more to the substance of the bill. I think we’re starting to skate towards the edge a little bit here.

Hon SHANE JONES: I was only referring to insurance as a possible mitigating effect that Ministers or former Ministers could rely upon rather than raiding the taxpayer’s pūtea. But I will follow your admonition. Banks—obviously, the cost of fees, and I’ll have more to say about the predatory behaviour and the egregious rorts that, in my view, we’ve seen in Australia and must inevitably be found in some manner or form in our own New Zealand banking system.

But, given that they don’t like me talking about them, I’ll choose a time, which is somewhat biblical, like the Ecclesiastes. It is a season for all things. Then there is the general need for the State to remain vigilant on behalf of aggrieved parties or on behalf of politicians who have received accounts where things are not showing that a market is working as we, as parliamentarians, imagine a market should work. Why shouldn’t a backbench MP, if possessed of such information, have the ability to rock up to the Commerce Commission and invite them to use their expanded powers? Or a vigilant Minister, like Minister Faafoi, using these expanded powers so that those who are reluctant participants are forced to cough—whether it’s the fuel companies or Countdown or indeed the real estate companies, given the gouging that I suspect has been happening there.

So I’m a thorough supporter of this bill whilst also being a supporter of a market economy. But without rules and regulations, markets have a Darwinist effect and a very negative effect on consumers. Thank you very much.

Hon PAUL GOLDSMITH (National): I rise to speak on this, the Commerce Amendment Bill. I do state that obviously there is widespread support across Parliament for strong and robust and effective competition laws, because, obviously, our living standards and the health of our economy depend on vigorous competition within industries so that New Zealanders have access to the best price in whatever they are consuming. Whether it’s power, whether it’s an ice cream or a bag of lollies or a TV or whatever, it all relies on there being effective—

Hon Shane Jones: Peanuts. Peanuts.

Hon PAUL GOLDSMITH: —and robust competition. Peanuts are just as important.

If you look at what we’re trying to achieve in politics here in the National Party, we’re looking at trying to have a strong and robust economy that delivers high living standards for all New Zealanders. But as well as just generating high incomes—people only get ahead if their incomes are growing faster than the cost of living, and so you do need to also put a great deal of attention on costs. That’s why there has been so much concern around Auckland, particularly recently, with the extra costs that motorists have had to endure over the last little while. People can understand the global fluctuation of fuel prices, but they also are very much concerned about the Government costs that have been added to it, and so the net effect is quite considerable. Focusing on reducing the cost of living for New Zealanders is a fundamental focus of all politicians, and particularly of the National caucus, so it’s important, as part of that, that we have good, robust competition laws.

Now, we’ve heard a lot of what I would describe as flummery from the Prime Minister and various Ministers over the past few days in relation to fuel prices and the fleecing, apparently, that has been going on by fuel companies. I suppose the first point I would make is that we already have—and we have had for decades—strong laws in place to deal with any price fixing or collusion between companies, or cartel behaviours in any industry. So if there is any suggestion that there is some sort of anti-competitive behaviour going on within that industry or any other industry, the Commerce Commission right now—right here, today, and for the last 30 years or longer—has the strong, robust powers to go in and hold those companies to account and, if they find them guilty, put very, very substantial fines in their laps and, potentially, send them to jail. So that is the nature of competition law.

That’s not what we’re talking about here today. What we’re talking about here is the addition of the ability of the Commerce Commission to undertake market studies in a particular area. So if somebody has a look at a particular industry—say, the banking sector, or fuel—and says, “Well, there’s nothing in particular that creates a prima facie case for the Commerce Commission to go in and prosecute somebody. That threshold hasn’t been met, but we think there’s something not quite right here.”, then we’ll go and have a market study. Now, there are some countries around the world that do this, and there are some that don’t. We haven’t traditionally. This piece of legislation is introducing that market studies power, and, on balance, National will be supporting that addition to the armoury that our competition regulator has available to it.

The point that I want to make in the last half of my speech is that it does rely on a responsible Government and a responsible regulator, because it is a significant, wide-ranging power that we’re putting in their hands. There is a real risk, particularly in a small economy like ours, that particular industries right across the economy will be subject to drive-by shootings by unscrupulous politicians, in particular. That’s the risk. I wasn’t so worried about that risk when the National Party was in Government; I am more worried about that risk right now. The previous speaker, of course, Mr Jones, has a long and rather famous record—

Hon Shane Jones: Proud, proud history.

Hon PAUL GOLDSMITH: He would say it was proud; I would say it was something otherwise. But he has made a career of attacking particular industries and groups, as we said—the supermarkets, the airlines, Fonterra, the banks. In fact, there’s not too much in the way of big business in New Zealand that he doesn’t think is reprehensible in some way or another at a particular time. He’s made an art form out of just attacking them and getting headlines, and has had the gall, I suppose, right here in this House, in this debate, to say that when it comes to the banks, “I’ll choose the timing of when I mount my attack on them.” So arming that sort of Minister with this sort of weapon is a dangerous situation, and so that is why it is so important that any Government with this tool available to it is disciplined.

Of course, we all have come to accept that that is the way that Mr Jones operates, coming from a smaller party, but when we see the Prime Minister of the nation operating in that way, that’s when many New Zealand businesses and New Zealanders have been deeply concerned. We have the Prime Minister talking about introducing market studies but also acting as the judge and the jury, saying that the oil industry is fleecing New Zealanders. I don’t know why she needs to have a study, because she already knows the outcome. In the process of doing that, she has been very funny with her numbers, saying that there has been a big increase in the cost of petrol since Labour came into power, and that only 6.8c of it comes from the Government—which is complete nonsense. The figure is well over 10c a litre in most of New Zealand, and well over 20c a litre in Auckland when you include the regional fuel tax, and that is a very significant part of the increase in the price of petrol. Of course, it’s not all of it, but it is part of it. So the “Fleecer in Chief” certainly has been the Government itself in this area, but that’s the point.

So the only point I’m making is that, yes, this could be a useful part of our competition armoury in a well-regulated and disciplined Government, and so, on balance, we think this is a tool that we should have, but it does rely on the Government of the day and the bureaucracy, in the form of the Commerce Commission, being disciplined in the way that it goes about it, and not using this purely for political purposes when a particular Minister feels like they haven’t had as much media coverage as they would’ve liked in the last couple of weeks and that it’s time to ramp things up by attacking a particular industry.

Why is this a concern for the average New Zealander? I mean, lot of New Zealanders like to see our business leaders in trouble, but, ultimately, we as consumers pay for everything that flows through the system in terms of costs that are added. Just as when it comes to the fuel pump, the Prime Minister can rail about all sorts of things, but the Government is adding everyday costs to undertaking normal business activity in New Zealand, such as a 27 percent increase over the next three years in the minimum wage, and if you don’t think that that flows through to higher petrol prices, you’re dreaming. Of course it does, and if you add all sorts of other costs, as well as taxes and levies, these things flow through to the costs that New Zealanders pay. An undisciplined approach to market studies in a particular industry can lead to millions and millions and millions of dollars being spent by lawyers over an extended period of time to undertake these studies. Don’t for a moment think that these can be done for $25.50 down at Kmart or something like that; they are very, very expensive things. That cost will be passed on to consumers.

Again, my simple message is, yes, this is a potentially useful part of the competition armoury in New Zealand, as it is in many countries around the world, but it must—must—be accompanied by a disciplined Government. From what we’ve seen so far from this Labour - Greens - New Zealand First alliance, I am a little bit worried. Thank you, Madam Assistant Speaker.

GARETH HUGHES (Green): Kia ora, Madam Assistant Speaker. Nga mihi nui ki a koutou, kia ora. Fakalofa lahi atu. It’s that sort of speech—and, actually, the result of nine years of that former Government that has seen this trickle-down, hands-under-the-bum, not acting result, which sees Kiwis pay some of the highest—

Hon Tim Macindoe: What is a “hands-under-the-bum, not acting” result?

GARETH HUGHES: You know, it’s sitting on their hands, free market, trickle-down, Ronald Reagan - style politics that sees Kiwis pay some of the highest costs of living, work some of the longest hours, and receive some of the lowest wages in the entire developed world—because that Government wanted to take a hands-off approach to the economy. They were quite happy for the oil companies to fleece ordinary consumers, but the reality is that they were talking about where the costs are going to lie. The member who just resumed his seat, the Hon Paul Goldsmith, was talking about the costs to businesses, not the benefits to consumers.

Now, if the member only bothered to read the background documents behind this, what he would find is, sure, there is a cost to business, but that is minuscule compared to the opportunities, the benefits, for consumers. In fact, the data shows there’s a $62 million net benefit for the country as a result of making sure we’ve got competitive markets. Now, the member, the Hon Shane Jones, gave a quote about markets, and I agree. I think they’re a great way in certain circumstances to deal with scarce resources—markets do play a role. But I also agree with the quote from Bob Menendez in the US, a former senator, who said, “Free markets are good, but what you don’t want is a free-for-all market.” Now, what we want to avoid is the fact where we have markets that only operate for the few.

This legislation deals with airports’ regulations with the Commerce Commission, and gives the Commerce Commission new part 3A, in the principal Act, to deal with market studies—the power through the Minister of Commerce and Consumer Affairs, or the Commerce Commission to do a market study into an area. This is critically important, because what we don’t want is markets that only work for a few. Now, we’ve seen the argument in the petrol market when it comes to the fuel storage in the South Island in the port of Lyttelton. A valid criticism can also be levelled at the supermarket duopoly. Here you have two major players—Foodstuffs and Progressive Enterprises—exerting massive market power and influence and control for producers, but also for consumers.

So this legislation simply gives the Commerce Commission the power to conduct those market studies. It’s not to regulate. It’s not to set the prices or do anything like that. It’s simply to do a market study to look into how competitive it is. I’d point out that this power already exists in the Telecommunications Act 2001—and here is a classic case, and I wonder: is the previous speaker, Paul Goldsmith, actually moving away from the philosophy which has rapidly driven down telecommunication prices for Kiwis? The only other area where we have the ability to do a market study is in the Telecommunications Act 2001, and it was these powers that actually led to unbundling, the split-up of Telecom, the entry of 2degrees into the market—a third player which has massively dropped telecommunication prices for Kiwi consumers: a clear net benefit. But if we listen to Paul Goldsmith, the poor cost to Telecom would be enough to rule out this legislation. So simply having this new market studies power in the public interest, dictated by the Commerce Commission or the Minister, is an important point.

The previous member also did a world survey and said, “Well, you know, it only happens in a few countries.”—absolutely wrong. When the OECD looked into this, what they found is that of the 62 countries surveyed, only New Zealand and Chile—the only two countries out of 62 developing-world and other countries surveyed—didn’t have these types of powers. So I think there was a bit of a falsehood or an exaggeration. It’s very clear that the overwhelming majority of developing countries do use these powers because they bring benefits to their consumers.

So it’s good for consumers, but I would also put it that it’s good for business. Now, I have read the submission of Business New Zealand who are pointing out the cost. I’ve already talked about the benefit-cost ratio which is clearly beneficial for the country and the public interest. Those small business costs are vastly outweighed by the benefits to the economy. I would also urge Business New Zealand members that, actually, it’s good for all businesses in New Zealand when we have competitive markets that are working effectively, with competition.

When you look at the sectors where there are risks of adverse market powers—fuel, energy, transport, food, telecommunications—these are critical areas for all New Zealand businesses to operate. Surely it’s in all New Zealand businesses’ interests to make sure we have a competitive market.

The last word I’d say on the new market powers provision in this legislation is from a former Commerce Commissioner, Donal Curtin, who said, “Most countries have come to the conclusion that if you have a competition authority, it’s kind of sensible that it should be able to find out whether the competition is working in places,” Now, this is the message to the industry: if there’s nothing to hide, there’s nothing to fear. This is an important step forward to make sure we have competitive markets and a fair go for consumers.

When it comes to airport regulation, what this bill is doing is not jumping first to regulating airports—who currently are subject to information disclosure under Part 4 of the Commerce Act. It’s simply providing a credible opportunity for that going forward. What’s the point of asking airports, which are regulated monopolies—just for example: Auckland, Wellington, and Christchurch. Two billion dollars was the profit paid by Auckland Airport over the last 10 years. These three international airports, monopolies in their regions, have huge powers to influence our tourism industry, which is—what?—$14.5 billion. Ninety-nine percent of tourists fly in through these airports. There’s a huge power imbalance between these monopolies, who have all the power, and the airlines and the airline passengers who have no power to negotiate.

So this legislation isn’t jumping to a regulation approach setting the prices. It’s simply saying that if there is excessive price gouging or problems in these markets, the Commerce Commission and the Government should have the power to regulate. I think it’s important to have that credible threat if—and I’m not saying there is—in the future there are issues with those markets and if they’re abusing their monopoly powers.

I guess there has previously been a case—when you look at Wellington Airport’s pricing, the Commerce Commission found that its profits were excessive and unjustified. I believe that was in 2013—between $38 and $69 million. In 2012 to 2017, Christchurch Airport was found to be seeking excessive profits in the range of $21 to $35 million. So it is a live issue, and it’s important that the Government and the commission have those powers simply in reserve if it ever needs them.

So the Green Party is happy to support this legislation which is making sure that there’s a fair go for Kiwi consumers and that markets are operating fairly, but it’s not just a free-for-all, and we’re not going to see monopolistic or duopolistic price gouging at the expense of the New Zealand economy. Kia ora koutou.

Hon JACQUI DEAN (National—Waitaki): Thank you, Madam Assistant Speaker. National does support this Commerce Amendment Bill at its second reading. We do have some concerns about this bill on the way through. First of all, to just very briefly mention the various parts of the bill, there are, effectively, three parts in this bill. One relates to airports regulation. There are three airports that are currently required to be within that regime in New Zealand, and, interestingly, the changes in the bill around airports regulation does anticipate that in the future there might be other airports that are brought into a firmer regulatory regime.

There’s a relatively small part of the bill which relates to alternative enforcement provisions that the Commerce Commission can impose as part of their work. So, they could impose an enforceable undertaking regime in relation to settlements and with penalties if that regime isn’t adhered to. They also repeal the existing provision in the Act which is the cease and desist regime. It was more or less redundant, and is rightly a piece of work that’s been tidied up. But the most contentious part of this bill is around competition studies and the market studies power, which is now well on its way to be given to the Commerce Commission. If I think back to about 18 months ago or maybe 2 years ago now when the then Minister of Energy, Judith Collins, initiated an Ministry of Business, Innovation and Employment - led market study into the electricity sector as a result—was it electricity or was it petroleum?

Matt King: Electricity.

Hon JACQUI DEAN: Yeah, I think it was electricity—two years has gone by—and it was hindered by the non-compliance with the various industry players—

Hon Shane Jones: Nine years of idleness.

Hon JACQUI DEAN: —with that—

Hon Shane Jones: Nine wasted years.

Hon JACQUI DEAN: Gosh, there’s an awfully loud noise in this Chamber. Leaving nothing, I find it disgraceful behaviour from a Minister of the Crown, just sort of barking away over the other side of the House. When I can identify where the noise comes from, well, maybe it might make some more sense, but I suspect not. Because actually, the Minister who is barking incoherently over—

Hon Shane Jones: Jacqui for leader!

Hon JACQUI DEAN: —the other side of the House is the very person who—

ASSISTANT SPEAKER (Poto Williams): Order, Mr Jones!

Hon JACQUI DEAN: —in the past—Shane Jones—has really been a reason why we need to be very careful about having a regime of market studies given to the Commerce Commission because he is a serial threatener of New Zealand business, for no better reason than maybe it might make him sound good in the media and get himself a few more votes, which seems to be driving a lot of his party’s policy development in this House. So Shane Jones is barking over that side of the House, whereas members of this side make a contribution to this debate. It’s unseemly, but it also speaks to what drives him as a Minister and why I am fearful about some aspects of this bill, as introduced by the Labour-led coalition Government.

Now, the difference between what was promoted by the previous National Government is that while we had promoted a market studies regime which was to be initiated by the Minister of Commerce and Consumer Affairs and signed off by the Cabinet of the day, the Labour-led coalition Government have amended the bill and introduced it to have a provision where the Commerce Commission itself can initiate a market study. Now, that is a substantial difference, and it is a difference which we should all be aware of, and my colleague the Hon Paul Goldsmith has a very well-known aversion to market studies power, and that aversion has been only made greater by the fact that under the bill, currently, there is no ministerial direction—

Hon Shane Jones: Democracy. Democracy.

Hon JACQUI DEAN: See, there we are, barking—barking, barking, barking—probably trying to get a headline but making no better contribution than that. And so now we have a rate at—

Hon Shane Jones: Not today. The barking mad is somewhere else.

Hon JACQUI DEAN: I raise a point of order, Mr Speaker. The barking across the other side of the House has got so loud that I can barely hear myself think.

ASSISTANT SPEAKER (Adrian Rurawhe): Thank you. No, the level is rising but, in my opinion, was within the boundaries of which is OK.

Hon JACQUI DEAN: Thank you. Thank you so much for that ruling. We do appreciate that spirit of fairness coming from the Chair.

So what we have here is a market studies regime where the Government of the day—and the Prime Minister has already frightened the business community with her comments around a potential fuel market study and how people are being fleeced at the pump, conveniently ignoring the impact of the Auckland regional fuel tax GST to her calculations of how much the fuel companies are taking in the cost of petrol.

Now, the signal that the Prime Minister and other Ministers are giving to the business community is “Be afraid. Be very afraid, because the Labour-led coalition Government is out to get you.” And not only has the Prime Minister sent that chilling message to the whole business community, the electricity industry, and the fuel industry but also Shane Jones, who is making such a worthy contribution to my speech, has indicated that he would very much like to see that same sort of unfettered power be awarded against Air New Zealand, for example.

So what is next? The Prime Minister has invited other Ministers to put up bids about what other industries the Commerce Commission might have a crack at. What kind of signal is that to send to the New Zealand business community? What kind of impact will that have on confidence in our economy? Now, the view of this side of the House was that a market studies power is an important tool but it’s also a very powerful tool, and, being a party of largely constituency MPs, who are close to their communities and who go into small petrol retailers—in fact, a large percentage of petrol retailers in New Zealand are, essentially, husband and wife couples, and they might have a mechanic working for them. But in small town New Zealand, in the provinces—where I ply my trade, as do many of our colleagues—it is those people who also will be impacted by a fuel market study.

It sounds great when the Prime Minister is standing on the platform saying that we are being fleeced at the pumps. Well, I’d tell the Prime Minister, a lot of that fleecing has happened because of her Government’s new tax regime that is driving up the cost of petrol for New Zealanders.

So let’s not forget that a market studies power is a worthy tool, but under our proposal it would have been absolutely controlled by the need for the Minister of Commerce and Consumer Affairs to make the case to Cabinet to initiate a market studies power. All restraint is gone—all restraint is gone—because now we have a Prime Minister and coalition partners who are openly threatening various sectors that they will initiate and direct the Commerce Commission to undertake a market study, and, in my view, that is totally irresponsible behaviour, and the New Zealand economy and the players within that economy, both large and small, have every reason to be afraid.

Dr DUNCAN WEBB (Labour—Christchurch Central): Thank you, Mr Assistant Speaker. It’s rather odd to sit here and listen to the members for the other side, who are going to support this bill—as they should, because, fundamentally, it did come from their Government—and yet the very thing they object to, on the one hand, is that the Commerce Commission has the ability to instigate these market studies, and yet, on the other hand, they’re objecting to the very thoughtful steps taken by our coalition partners and others to scrutinise what’s going on in the market place. We absolutely need to have markets which are well disciplined, and you can’t know if a market is well disciplined unless and until you know what’s going on in the market. So of course we need these market studies.

There is a real concern—a real and genuine concern—in many markets in New Zealand that there are aberrations: that there are monopolies or duopolies, that there may be cartel-like behaviour, that there may be some kind of market collusion or price fixing, that there could be some kind of abuse of market power, or that, simply, there’s no clear and fair information about the nature of the products and their pricing. But do you know what? We don’t know that, because it’s complex. The markets—the way they work is complex. Even if we do look at the fuel market—we look at the 30c increase that has occurred which has nothing to do with the very useful levies which are being used to fix our infrastructure deficit. It’s just come from somewhere, and we’re not quite sure where. Is it fleecing? Well, it damn well looks like it, and we need to find out. But we’re not going to just make it up; we want to do a study.

Now, if you’re going to do a study, you can’t do that unless you have the ability to ask for and, ultimately, demand that information, and when you need that information, you need it now and you need it in full. So we can’t just send someone into the market to ask nicely; we need the Commerce Commission to have these powers. And, yes, they will be expensive. The Commerce Commission has extra funding to conduct these, and we must accept that there will be a burden on industries who are asked to respond to these questions. But if there’s nothing going wrong, they have nothing to fear.

Andrew Bayly: That is naive.

Dr DUNCAN WEBB: What will ultimately happen is that abhorrent markets will be fixed. And who will be the winner? I’ll tell you who will be the winner, Mr Bayly. The winners will be (1) the consumer, and (2) every honest business in New Zealand, because a good, honest, and competitive business will thrive, whilst we can pay attention to those who are breaking the rules, who are acting inefficiently or who are abusing their power, or where the market is simply broken and needs intervention. So that is why we need these powers. That’s why the Commerce Commission needs these powers. We need to understand a market before we take any steps in respect of it.

The other thing is this: it’s highly likely that once we know what’s going on in these markets—once this power has been exercised—no further steps will be needed, because what is going on will see the light of day. Consumers will know if they are being taken advantage of. Other businesses will know where other players are not playing by the rules, are cheating, or are simply making monopoly profits. So it’s absolutely imperative that not only Ministers have the ability to look and say the public needs to know, but also the Commerce Commission, because quite rightly there will be instances where we have to depoliticise this question, where in fact it may be something which the Government has a hand in. Air New Zealand, owned largely by the Government—well, maybe we need to look at airlines. That may well be the case. It may be a hard decision for the Government to make; the Commerce Commission can make it one step removed without any suggestion of political interference, and that is absolutely to be endorsed. The test is a public interest test: what is in the interests of the public of New Zealand, businesses, and consumers? And a fair, free, and properly regulated market is absolutely what is in the interests of the New Zealand public. This won’t be a fishing expedition. Businesses need not be alarmed that there’s going to be a whole lot of investigations that are unnecessary and expensive. No, this is going to be a tool which will be carefully exercised, modestly exercised, and absolutely exercised in the interests of New Zealand and our markets will be better for it. Thank you, Mr Assistant Speaker.

ASSISTANT SPEAKER (Adrian Rurawhe): I call Alastair Scott—five minutes.

ALASTAIR SCOTT (National—Wairarapa): Thank you, Mr Assistant Speaker. I think it seems we can at least agree that competition is a good thing. Competition enables resources to be allocated. And businesses—we’re talking about particularly—to be run efficiently and motivated to survive and earn a profit, must compete with each other. Costs are reduced; the consumer benefits. So, generally, competition is a good thing.

But as we’ve discussed, there is, from time to time, a need for the Commerce Commission—we’re talking about here—to investigate particular industries.

Hon Shane Jones: Eggs in the Wairarapa.

ALASTAIR SCOTT: But as noted by previous speakers, the concern that we have on this side is that the Commerce Commission or the Minister starts barking at the parked cars, starts barking at—I think Mr Jones wants to talk about investigating supermarkets, but he doesn’t know or understand that there’s a hell of a lot of competition already in that sector. For example, think of the fruit and vege market down at the wharves here in Wellington or on the local green in the provincial towns—lots of competition that consumers are able to access. So if we have a Minister like Mr Jones who decides that for some reason he wants to pick on an industry like supermarkets, then we’re wasting money. We’re wasting taxpayers’ money on fixing something that doesn’t need to be fixed.

So that is the concern that business has—that there is an additional cost, an unnecessary burden put on them and we’ve already talked about mum and dad businesses in the fuel industry, the service station industry, which is unaffordable, which is just another layer. Some of the members—not all the members—on the other side don’t seem to concern themselves with small and medium business operators and the costs that these types of regulations impose on them. The other risk of course—and Mr Jones mentioned real estate companies as a possible target. He doesn’t like real estate companies either. I tell you what: if you bought or sold a house recently, you will know you can shop around and you can get that fee down aggressively. These guys are competing with each other all the time. So, again, why are we going to be chasing a parked car and particularly the real estate industry when we know here that it is an extremely aggressive and competitive industry?

Perhaps, rather than focus on that, why not look at—no one’s talked about the cost of building a house and some of the roadblocks and some of the bottlenecks that are existing—

Kieran McAnulty: Like the last Government.

ALASTAIR SCOTT: Well, that’s the Government in charge but we haven’t heard anything about the cost of building a house from that side. So how about looking at something like that? How about looking at something about the allocation or the cost of water? Imagine looking at that and running that effectively and efficiently rather than a parked car like the real estate companies and the supermarkets.

The Hon Paul Goldsmith mentioned it wouldn’t be so bad if you could rely on having a responsible Government or rely on having a reasonable and responsible Commerce Commission to do the job that this legislation allows them to do. But our concern on this side is that it has room to go nowhere—for an inquiry to be a waste of time and space, to put a layer of costs on a small business unnecessarily. As I say, the Labour Government—coalition Government is what it’s called nowadays, I think—do not appreciate the costs already imposed by regulators.

And I tell you the reason why more regulations are a bad thing. Mr Faafoi’s got another idea to regulate loan sharks. He wants to put a cap—I digress slightly Mr Assistant Speaker, if I may—on loan sharks. But all that does is it puts the business under the table. It puts that whole industry under the table, because people will still want to borrow money, and if the loan sharks don’t give it to them above the table, you know what, Mr Faafoi? They’ll do it under the table where you can’t see, where the people will still be suffering, and that is the problem with more and more regulations from that side.

ASSISTANT SPEAKER (Adrian Rurawhe): This is a split call—five minutes. I call Willow-Jean Prime.

WILLOW-JEAN PRIME (Labour): Tēnā koe. Kia ora, Mr Assistant Speaker. I just want to bring a little bit of local and personal context to the debate that we’re having, and I won’t take too long to speak to this bill, given that I’m almost the last speaker. But I was recently contacted by a year 13 Bay of Islands College student who sent me a Facebook message and asked who deals with fuel prices, and a mother who tagged me in a Facebook post who is considering moving to Australia. She’s concerned not only about the cost of fuel but also about the cost of food and asked why our food is more expensive than Australia’s, and, in fact, those living in Australia said, “Why is it that we can get New Zealand food cheaper over here in Australia?”

So these are real concerns in my local communities, questions that I’m being asked on the street, and I support the second reading of this bill which provides us the ability to do market studies. It is simply one tool that will be available to us to make sure that the market is fair and that New Zealanders are paying fair prices, and that’s all that my communities want to be assured of. I support that this means that this can be initiated not only by Ministers but also by the Commerce Commission itself, and, as a previous speaker had noted, they have to prove that there is a public interest in initiating such a market study.

I want to thank the select committee that worked on this bill and all those that made submissions, and highlight one of the recommendations that is coming back from the Transport and Infrastructure Committee, which was to recommend the insertion of a new section 51E. That is to require the Minister to respond to the commission’s final report on the completion of the study within a reasonable time frame. I think that that’s an important addition to this bill, and I’m pleased that it was supported by the Minister in his opening remarks—that that change is welcomed and that the Government should be required to state its views on the commission’s findings and what steps it proposes to take in response to any recommendations. I think that that adds to the transparency and the integrity of the regime.

So with that, I’m not going to take up any further time, other than to put the local and personal context to this issue that we’re debating this afternoon, and say that there are situations where it is in the public interest, with the Commerce Commission having the ability under this proposal to be able to initiate market studies which will ensure that our people are paying fair prices.

DAVID SEYMOUR (Leader—ACT): Well, thank you, Mr Assistant Speaker. I rise on behalf of the ACT Party in opposition to the Commerce Amendment Bill. I have to say to the speaker who just resumed her seat, Willow-Jean Prime, that the intentions, as so often is the case with the Labour Party, are very noble. Of course people would like more affordable stuff. Of course we’d like a more competitive and efficient economy. Of course people would like more affordable living. There’s no question about that. But that’s not what’s being debated.

What’s being debated here today is whether the Commerce Commission, who have more powers to inquire and subpoena information than the police, should have the ability to sui generis off their own initiative or with the instruction of a Minister—who is a politician—and be able to decide to go into an industry, demand information, and make recommendations that could lead to the restructuring of private businesses. Is that what should be allowed? On the one hand, you’ve got a situation where there are enormous problems in New Zealand with excessive bureaucracy, with too much Government holding New Zealanders back from being more productive, and this Government’s way to make the economy more productive seems to be to add yet another layer of bureaucracy, yet another layer of Government power, on the assumption that somehow the Commerce Commission—after they’ve used their powers to demand information from private businesses, under threat of criminal conviction—will somehow be able to recommend that the industry be broken up, have new competitors enter the market. Who knows?

The fundamental problem is that the Commerce Commission doesn’t know how many competitors should be in a particular industry. The Commerce Commission doesn’t know exactly what a particular industry, such as the retail fuel industry, should charge. You just have to ask yourself this question: if you knew what the correct time for a new competitor to enter a market such as supermarkets was, if you knew what the competitive margin for fuel retailers to charge was, would you be (a) working for the Commerce Commission, or (b) making a huge amount of money while delivering cheaper prices for New Zealanders? Well, of course, people who know what the structure of a market should be are not working for the Commerce Commission. If they knew that, they would be making a lot of money out-competing the current market and bringing down prices.

But it’s worse than that, because not only will this new market study provision allow the Commerce Commission to impose bureaucratic costs on businesses, not only will this new market study provision fail to make anything cheaper, because they don’t know what the right prices should be and they don’t know how many competitors should be in a market; it’s actually an invitation to corruption.

Imagine, if you will, a Minister going to a wine and cheese industry event at an evening where everybody in that industry knows that the Minister has the ability—at a whim, with no justification of his own—under this legislation to unleash a market or a competition study by the Commerce Commission that has more powers than a police inquiry. That is not the kind of position that New Zealanders would like to think a politician should be in. But that is the position that a Minister of Commerce and Consumer Affairs will be in under this legislation. That is why this bill not only will be ineffective, not only is a distraction from the real task of raising the standards of competition and productivity in New Zealand, but is actually dangerous because it erodes an inheritance that all of us have—a political body and a Civil Service that is supposed to be above suspicion and above corruption.

The way that this legislation is being rushed through, so that a market study into retail fuel can be done, when the Prime Minister has already announced the result—i.e., those industries are fleecing consumers—is yet another reason to oppose this bill and why it’s corrupt. I wish I could say that only the Labour Party think that this is the answer to high prices, but, of course, this is a bill that National agreed to in Government too. I’m proud to be standing for ACT—

ASSISTANT SPEAKER (Adrian Rurawhe): Order! The member’s time has expired.

ANDREW BAYLY (National—Hunua): Thank you, Mr Assistant Speaker. It’s a pleasure to be talking on the second reading of the Commerce Amendment Bill. I thought I’d just start out by just talking about what the Commerce Commission does, because I haven’t actually heard anyone say what it does. First of all, it regulates telecommunications, electricity, dairy, and the airports, and it also administers parts of the Commerce Act in terms of approving—or otherwise—mergers and acquisitions, particularly on the stock exchange. It also has a responsibility for the Fair Trading Act and the Credit Contracts and Consumer Finance Act.

In general, I think the Commerce Commission does a reasonable job in terms of fulfilling its remit. Of course, what we’re talking about today is actually a National Party bill, essentially. We are all about making sure that we have a healthy, competitive environment in which businesses can compete and go out and get consumers and supply the goods and services that they need at the price they require, and give them the choice that they require, as well. We also recognise the limitations of the Commerce Commission framework as it currently stands. Although, I’ve got to say, it does have extensive powers, particularly under section 98 of the Commerce Act.

The thing about this bill, whilst I think we were trying to deal with it—and when I say “we” I mean the National Party, when we introduced this bill—was it was trying to improve the framework. The thing that worries me most about this is how it’s suddenly become a very political bill. I think it’s actually an absolute smokescreen for the issue that is now besetting the Government—the Labour - New Zealand First Government—with the issue around fuel taxes.

I just want to talk about that for just a couple of minutes, because there are three reasons why fuel taxes have gone up. First of all, the price of fuel—ex Singapore or overseas markets—has gone up. When we were having this discussion back in April, if anyone from the Government had sat down and done a Google search, they would have already known that the fuel prices were going up, but they were mindless to that opportunity and what was going to happen and charged on with imposing the fuel tax rise.

The second thing is, no doubt, the increase in fuel taxes. I did a calculation in my own electorate of Hunua, where we don’t have access to public transport. We have large areas of rural communities who do not have any choice other than to use their cars. My calculation is it’s about $20 a week, if you’re travelling 100 kilometres a day, and that is very normal for most of my people living in my electorate. So that issue is increasingly coming to bite the Government.

The third one is the drop in the value of the New Zealand dollar. We’ve seen it plummet under this Government. The day that they came in it was at roughly US73c; now it is US65c. I’m sure there might be one or two on the other side that follow foreign exchange and probably think, “Oh well, a lot of that’s because US interest rates have risen.” Well, to some extent that’s true. But the issue is the New Zealand dollar’s fallen against virtually every currency—virtually every currency. You have to ask, why did it plummet from US73c to US65c today, in 12 months? The reason is that the international community 12 months ago had a different view on this economy. What they’ve witnessed over the last 12 months is a systemic and systematic attempt to disband and deal and create increased risk around this economy.

So we’ve seen things like the labour reforms that are coming through—I see we’re going to debate one soon. We’ve seen that. So businesses are looking at the environment, saying their cost structures are going up. We’ve seen the likely imposition of the fuel taxes. We’ve seen that this Government’s going to pile on an extra $16 billion of debt—$16 billion of debt—and they think no one notices. Well, I’ll tell you why: we’ve already seen our GDP drop from being one of the highest in the world to now middling, to the bottom end of the OECD. That’s why international communities look at New Zealand and go, “That’s a more risky place than 12 months ago.” That is why our dollar has dropped from US73c to US65c—through mismanagement of this economy by that Government, that Labour - New Zealand First Government.

I just want to move on now. We agree with most of the elements in this bill. But the key difference I just want to highlight is that this Government has made a change. They have made a change to the bill. That is, they have allowed the Commerce Commission to self-initiate market studies, giving the Commerce Commission unfettered powers with no oversight. I disagree with this premise.

It’s interesting, because if you look around the world and you look at the ACCC, or, in other terms, the Australian Competition and Consumer Commission, what is their jurisdiction? Their jurisdiction is that they can self-initiate competition or market studies, but they do not have the right under that circumstance to request or require the information to be supplied. They can only get it—they can only have those extraordinary powers—by actually going to the Minister and seeking them. With the ministerial oversight of that request, that’s when they have the power to require information, and, of course, that is a very significant power.

If you think about the UK Competition and Markets Authority—and I visited them 12 months ago to have this very discussion with them in London—they have the right to undertake market powers, but they, again, have been established with a system that has a check on it. The check is that the management of the UK’s Competition and Markets Authority can initiate an inquiry, but it must first get the approval of the board. That’s what we were talking about when we introduced this bill. It was to have ministerial oversight.

So in both those jurisdictions, which in my view—and I’ve studied this area closely over the years—are two very good examples, both of them have the ability for some independent oversight before you give any of those competition authorities in whatever jurisdiction—Australia, America, the UK, or whatever—the ability for someone to, say, check and pause and say, “Is that a relevant power?” But what this Government’s proposing is that we will allow the Commerce Commission to undertake these significant studies with all the rights and powers to require information.

I think it’s absolutely naive of the member for Christchurch Central, who spoke about the fact that if you’re in a business and you haven’t done anything wrong, then you’ve got nothing to fear. Well, commercially, that is absolutely naive, and I would have thought from a lawyer that we might’ve seen something a little bit more practical, because these market studies are incredibly invasive—incredibly invasive. When the Commerce Commission decides to do it—and I have been involved in these studies in assisting the Commerce Commission—they are extensive in terms of the requirement on the people that are involved in those businesses, not only in terms of their time but the nature of the information, the cost of compiling that, and the cost of having proper advisers, lawyers, accountants, and whoever you need to get to assemble that information to make sure it’s correct, because you cannot afford not to make sure that it’s correct.

The second thing is they are incredibly disruptive to businesses. They are incredibly disruptive because these studies take a lot of time. I’ve heard the Minister of Commerce and Consumer Affairs talk about it before and I heard his estimate of $400,000 for these studies. I’ve never heard of a study with a $400,000 cost. They are significant in terms of time. The cost involved for the Commerce Commission, as opposed to the people they are investigating, is absolutely significant. They are invasive, and, until you are proven innocent, there is an issue that everyone knows you are subject to a Commerce Commission inquiry. That is against the counterview of making sure that everyone is presumed innocent until proven guilty.

That is the reason why I think this bill is fundamentally wrong in terms of allowing the Commerce Commission to be able to do these studies in an unfettered manner. That’s why I will personally be supporting—and our party is supporting—the Supplementary Order Paper that Brett Hudson is proposing to put forward to say that these powers should be subject to ministerial oversight. That is world-best practice, and this Government doesn’t know that.

RAYMOND HUO (Labour): Thank you, Mr Assistant Speaker. Following that National member who has just resumed his seat, I got the strong impression that Mr Andrew Bayly might have got the wrong bill, because there was no reason for him to shout and there was no reason for him to be so emotional. Having said that, I do want to acknowledge the National Party for supporting this bill allowing the Commerce Commission to investigate petrol companies, despite that they voted against the bill’s first reading.

It’s a no-brainer for us to understand and acknowledge that consumers should be at the very heart of competition and consumer policy, and this bill intends to achieve just that. This bill will empower the Commerce Commission to undertake competition studies by carrying out research into the structure and behaviour of markets and to report its findings. Many consumers, for example, will want to know what’s behind the petrol price and how on earth New Zealand’s pre-tax costs would be so high. Surprisingly, as noted by speakers who took a call before this, in terms of a market study regime, among 62 countries surveyed, only Chile and New Zealand do not have such a kind of market study regime.

Market studies will allow in-depth investigation to be conducted by an independent competition authority, the Commerce Commission. So the real winner will be the consumers and businesses. I commend this bill to the House.

Amendments recommended by the Transport and Infrastructure Committee by majority agreed to.

Bill read a second time.

Bills

Equal Pay Amendment Bill

First Reading

Hon IAIN LEES-GALLOWAY (Minister for Workplace Relations and Safety): I move, That the Equal Pay Amendment Bill be now read a first time. I nominate the Education and Workforce Committee to consider the bill.

I am honoured to be speaking to the first reading of this significant bill, which makes history for women’s pay, a mere 125 years since women gained the right to vote in New Zealand. The bill amends the Equal Pay Act 1972 to expressly provide for a pay equity regime that allows parties to negotiate pay equity settlements. This bill is a vital step in addressing decades of discrimination, which has led to lower pay in many female-dominated industries, despite having similar working conditions and skill requirements to comparable male-dominated industries. This Government believes that a pay equity regime must be just and accessible. I believe that not only will this bill benefit women whose work has been subject to gender discrimination but it also has the potential to benefit their families and future generations of women.

I would firstly like to acknowledge the tremendous work of Kristine Bartlett, who, together with her union, E tū, brought the landmark Terranova case, which resulted in the Care and Support Workers (Pay Equity) Settlement Act 2017. That case demonstrated that the Equal Pay Act 1972 applied not only to cases of equal pay, which is the same pay for the same work, but also to pay equity, which is the same pay for work of equal value. The courage and perseverance of Kristine and her union resulted in a settlement to address gender-based undervaluation in the aged-care sector. They made legal history and breathed new life into a statute that was thought moribund.

I would like to acknowledge the work of the Joint Working Group—and the reconvened joint working group—on Pay Equity Principles. The joint working group was formed in 2015 to recommend principles to the Government for the implementation of a pay equity regime in response to the Terranova case. The previous Government decided it would be better for these principles to be decided by a broad-based group of workers, employers, and experts than to be left to the courts to decide. It was the right thing to do, and they deserve credit for making that call. The joint working group recommended a process for making a pay equity claim within the existing bargaining framework of the Employment Relations Act 2000. By using New Zealand’s existing bargaining framework, we will permit employers and workers to negotiate in good faith and to have access to mediation and resolution services.

By making court action a last resort, we will lower the bar for initiating a pay equity claim. We believe good-faith bargaining offers the best opportunity to build productive relationships through a collaborative process. Pushing parties into an adversarial court process in the first instance is not a way to build good employment relationships. Having started well by convening the joint working group, the previous Government stumbled when they introduced the Employment (Pay Equity and Equal Pay) Bill in 2017, which set unnecessary hurdles for employees making pay equity claims, including a high threshold for claimants to meet in order to raise a claim. They also ignored the joint working group’s recommendation to amend the existing Equal Pay Act 1972 and instead created a whole new Act.

This Government is committed to a fairer deal for women. We withdrew the previous Government’s bill and reconvened the joint working group in December 2017 to make further recommendations on determining the merit of a claim as a pay equity claim, how to select appropriate comparators when assessing the work that is subject to a pay equity claim, and the legislative vehicle. The reconvened joint working group recommended lowering the threshold for a claim and to make no changes to the principles on comparators, effectively determining that the hierarchy of comparators in the previous Government’s bill was unnecessary. It also recommended that these principles be implemented by amending the Equal Pay Act 1972.

The coalition Government accepted the recommendations of the reconvened Joint Working Group on Pay Equity Principles, and we have been working to amend the Equal Pay Act in a way that expressly provides for a just and accessible pay equity regime within this important piece of legislation. This bill aims to keep the equal pay and unlawful discrimination provisions from the Equal Pay Act as intact as possible and only makes minimal workability changes to these provisions. The intention is not to change existing rights, and we would welcome feedback on this in the select committee process.

In terms of pay equity, the bill uses the existing Employment Relations Act 2000 bargaining process as a framework for parties to address pay equity issues, provides employees with the right to raise a pay equity claim with their employers in the first instance, and provides access to dispute resolution services such as mediation and facilitation if parties cannot agree at any stage of the process. The bill moves away from forcing parties directly to the courts and instead puts negotiation at the forefront of the pay equity regime.

Litigation can be costly, time-consuming, and can create a barrier that may discourage employees from raising a claim. This bill uses our existing employment bargaining framework to enable parties to come to a settlement that provides for pay equity while still retaining the right of recourse to the Employment Relations Authority or courts through the dispute resolution process. For an employee to raise a pay equity claim with their employer, they no longer have to prove that their claim has merit. Instead, they simply have to show that their claim is arguable as a pay equity claim. A pay equity claim is arguable if the claim relates to work that is predominantly performed by female employees and it is arguable that the work is currently undervalued or has been historically undervalued.

If an employer decides that the pay equity claim is arguable, parties must proceed to bargaining. However, the bill is clear that although an employer may agree a claim is arguable, this does not mean that there is a pay equity issue or that there will be a pay equity settlement. Pay equity bargaining must ordinarily involve an assessment of the nature and remuneration of the work and of comparable work and must be undertaken free from assumptions based on gender. During the bargaining process, the work is assessed against the work of appropriate comparators. Appropriate comparators include work performed by male-dominated comparators that involves the same or substantially some of the work; work performed by male-dominated comparators that involves the same or substantially similar skills and experience, responsibilities, working conditions, or degrees of effort; or any other comparator that the parties or the authority consider useful and relevant.

The previous Government’s bill included a hierarchy of comparators that mandated which comparator groups employees had to refer to first. Claimants had to first consider comparators within their organisation before being able to consider comparator groups within their own industry or sector. This made the process more onerous for employees and set hoops for them to jump through. We believe in making this process as easy as possible for employers and employees to manage. Under this bill, there is no mandated group of comparators that employers and employees must use first. Instead, they are free from the outset to refer to whichever comparators best fit their claim. During bargaining, parties can agree to whatever terms and conditions they wish. However, they can apply to the authority for determination on matters that they cannot agree on.

In bargaining, parties are free to discuss and reach agreement on back-pay as part of their pay equity bargaining. If back-pay is considered and parties are unable to agree, the dispute resolution process is available. At the end of the process, the authority or the court will be able to make a determination on back-pay. Let me be clear about this point: this bill does not create the right to claim back-pay. That right has existed ever since the courts determined that the Equal Pay Act applies to pay equity claims.

The way in which back-pay will be determined by the authority or court for pay equity under this legislation is different from the process for determining arrears for equal pay. This reflects that pay equity is the result of systemic, gender-based undervaluation of female-dominated jobs. This is something that cannot be directly attributed to the actions of a single employer. However, increasing awareness about pay equity issues puts employers on notice about the possibility of pay equity issues within their workforce and creates a responsibility for employers to take action to address it. The treatment of back-pay for pay equity claims therefore balances the structural origins of pay equity with the responsibility of employers to address pay equity issues.

Under the bill, in the first five years after the law is passed, which is when we expect most pay equity claims to be settled, back-pay is available back to the date the claim was raised with the employer. This gives employers a chance to investigate whether there is a pay equity issue. After that point, back-pay can be awarded back to the five-year anniversary of the legislation coming into force, which in some cases may be an earlier date than the date the claim was raised to incentivise employers to look at and address pay equity issues earlier. The authority and courts are also able to exercise discretion in awarding back-pay, and the bill sets out factors that they must take into account. These factors allow the authority to look at the circumstances of each claim and to tailor its approach accordingly.

This bill is the next step in the great march of history towards a more equal and more just society. It will have significant benefits for all of society, and I’d like to thank our coalition and confidence and supply partners for working with us on this bill. In particular, I would like to thank the Minister for Women for working with me on this important work. It is an honour to commend this bill to the House.

Hon NIKKI KAYE (National—Auckland Central): I am delighted to be speaking on this legislation in the House today. At the outset, can I just agree with a number of things that the previous speaker, Iain Lees-Galloway, has said. Firstly, though, can I start by acknowledging Kristine Bartlett—what an extraordinary New Zealander, and she did not act alone. She had the fight, the courage, and the perseverance of a whole lot of other New Zealanders in what led to what was a very historic $2 billion pay equity settlement under the previous Government.

But I think it is important that we do look through the lens of history here, because, in the words of the current Minister for Workplace Relations and Safety, this is about justice and access to justice, and it actually is OK—in a year when we’re celebrating 125 years of women winning the right to vote, being the first country in the world—that we actually say we need to do a lot more. We have had some progress, and I think if you look at some of the measures that we judge ourselves by, there has been some progress. In fact, if you look at 1998 to 2018, we saw the gender pay gap go from about 16 percent to 9 percent. We are not proud of that; we want to do better, and that is what this legislation is about. But it is also a time to say things are heading in the right direction, and this legislation is, hopefully, a major game-changer for the thousands of women in particular out there that are not earning what they should—equal pay for equal work—and that is what this legislation is about.

I think it is time, as well, that we do acknowledge the working group. The Rt Hon Dame Patsy Reddy did a fantastic job. On this side of the House, National would say we would’ve hoped to have been here earlier. We do acknowledge the work of the working group, but we do believe that we are 12 months behind, in part—Denise Lee had a fantastic piece of legislation, and we’ve got a couple of amendments here, but we could’ve been going a lot faster on this piece of work, given that there has been really good cross-party agreement around changing the law. Again, this Government did spend that 12 months putting it back to the joint working group.

But just again, coming back to the main provisions in the bill, I mean, ultimately, we need to acknowledge as a country that in certain professions—and, you know, I’m involved in education, but every single day I meet teachers and support staff, predominantly in a female-dominated profession, for which, if you look at comparable sectors, the reality is they have not been valued as much as other men doing complex roles like, at times, being principals and teachers. And that’s what this bill is about.

Now, ultimately, if you believe in that goal—and everybody in this House does; that’s why we’re here, and we’ve got cross-party agreement—then the question is, what is the best policy and legislative machinery to be able to deliver that? As I’ve said before, I think there is a lot of agreement, but some of the core differences between the bill that my colleague Denise Lee put up versus this bill do relate, for instance, to the hierarchy of comparatives. And again, that was very clearly set out in previous legislation that National put up, and there is a difference in this legislation.

Again, if you look at the issue of back-pay, it is important—and the Minister has acknowledged the fact that back-pay is not new and the six-year provision actually is consistent with the Equal Pay Act. That is part of this bill and I look forward to being a member of the select committee and looking at these issues of back-pay. The reality is, there are people out there that are owed—and it will be shown—huge sums of money, because the reality is they have been undervalued for many years.

It has been a privilege to meet people like Kristine Bartlett and to understand the huge impact on people’s lives, not just financially but also at a self-worth level, of not being valued properly and having this discrimination. Again, it is very timely that we are doing this in the year that we’re celebrating women having the right to vote, 125 years on.

I think the other big provision that we will be talking about at select committee on this side of the House is this issue of the criteria—of which we had previously used the term “merit” and now that has been changed to be “arguable”. And again, this is a delicate balance, because everybody in this House wants justice and wants that access to justice, but what we will be focused on is ensuring that we have legislation that doesn’t create a situation whereby we have a whole lot of claims coming through that may not end up being of merit. Because that’s in nobody’s best interest that people’s time is wasted because potentially the system is clogged up with claims that aren’t of merit. So it is a delicate balance there and, again, the Government has chosen to change that term to “arguable”, and we will be asking significant questions about what is “arguable”, because, arguably, almost anything can be arguable. So we do want to hear from submitters around that particular provision, because I think it is really important because, again, if we want the most amount of effort on those claims that are of merit then we won’t be clogging up the system with other claims.

The other thing I want to acknowledge in the legislation is the fact that there has been a shortened time frame to give the employer to respond to the claim: from 90 days to 65 days. Again, on the face of it, that might seem like it’s quicker access to justice, but some of these claims are very complex and we need to acknowledge that. So that’s something else that we will be testing out in select committee—is that time period enough?

Then, I think, if we again step back and look at the bigger picture here, and we remind those people that are watching that there is cross-party agreement to put this legislation in. Again, it’s going to come back to the process. We think this issue of the hierarchy of comparators was the right approach. That has been changed by the Government, and we’re going to be very interested to see how that actually plays out in practical terms. As a former Minister of the previous Government, the reality is, you can imagine that you can get tied up with some claims that may not necessarily have merit, and that’s what we will be focused on.

Look, I think the other sort of bigger picture here is that we cannot have equity, we cannot have equality of opportunity, and we cannot have equal pay and equal pay for equal work in this country if we just think of this legislation alone. It will not just be a fair and practicable legislative process that will turn around historic discrimination. We also need to, at a leadership level, all speak to those business leaders, those community leaders, and also those parts of Government that may not have valued particular sectors high enough. I think that would be my plea: it’s not just about the legislation; it’s also about a cultural shift as a country that needs to occur.

That’s why I am proud of some of the things that we did in the previous Government. We were focused on greater flexible working, which is very important because it is about valuing a diverse group of people. We were focused on ensuring that we get more women into areas like science and technology, which is crucial—again, whether it’s the digital technologies curriculum. There are other things in Government alongside this legislation that we have to be doing to ensure that every young child, whether they are a boy or a girl or LGBTIQ or of different ethnicities, has the same equal opportunities, and that does not just involve this legislation. Again, I do want to acknowledge areas like the police force that have tried to be way more progressive in the last few years. The police have set a target of 50 percent of police recruits to be women by 2021.

So I’m very pleased to be standing in this House to be a member of the select committee to be considering these thorny issues that will, in my view, lead to thousands more people, who have been historically discriminated and undervalued, to be properly recognised and rewarded for their efforts. For some people it will be life changing. We saw that with Kristine Bartlett, and all of the people that ended up getting significant pay increases as a result of that. And that is what we are all hanging out for in this House: to be able to give that equality of opportunity and to be able to ensure that those people are properly recognised. But we must do more as a society, both culturally and also fiscally.

Hon EUGENIE SAGE (Minister of Conservation): Fakaalofa atu Fakatonu, Fono Taane.

[Greetings, Mr Speaker.]

I am proud to speak here on the Equal Pay Amendment Bill as the Acting Minister for Women. I am here because our Minister for Women, the Hon Julie Anne Genter, is on maternity leave, so I think it’s a great reason to be speaking today. I, like the Minister, want to acknowledge the work that she has done on this bill.

Ensuring that women are paid fairly is a key objective of this Government and of the Minister for Women and the ministry. The work that women in female-dominated industries do has long been undervalued, because it’s work that women do. It is administrative work and jobs involving people working with people: teachers, nurses, and support staff in those industries. It’s all underpaid because it’s predominantly women who have been doing those jobs.

The gender pay gap this year is 9.2 percent, which means that on average women are paid 9.2 percent less per hour than men for an hour’s work. That gender pay gap has certainly reduced since Statistics New Zealand started measuring it in 1998 when it was 16.3 percent, but it has been coming down too slowly, particularly in the last decade. Some companies, though, are making good progress. I was really pleased to see Air New Zealand in its sustainability report out today—that company has a gender pay gap of 0.41 percent, and the chief executive, Christopher Luxon, says that the company is continuing to drive a deeper understanding of the unconscious bias. So there I agree with the Hon Nikki Kaye—it’s that cultural change that we need to make as well, looking at gender bias, looking at what this does.

Of course we know that the gender pay gap is far worse for Māori women, Pasifika women, women with disabilities, and trans women. So these multiple intersecting barriers must be addressed. It’s in the Green Party’s confidence and supply agreement with Labour that we have got a commitment to eliminate the gender pay gap within the core public sector and to make substantial progress on that within this parliamentary term. This legislation that we are introducing today is part of that. It’s part of this Government’s objective to ensuring that New Zealand women are paid fairly.

But as others have said, it’s not just this bill that’s going to do it. To eliminate the gender pay gap, we need to do more, have more employers do as Air New Zealand is doing to measure the pay data of their employees, to understand the gender pay gap in their company, and to understand those unconscious bias issues. We need to normalise flexible working hours for both women and men, and we need more accessible and more affordable childcare. But we really need this bill, because it’s enshrining the principle that men and women should receive the same pay for doing jobs that are different, but of equal value, which require similar degrees of skill, responsibility, and effort. Enacting this pay equity legislation will help strengthen our economy in the longer term, because it will be valuing people and the work that they do—women—which has traditionally been undervalued, and it will improve the well-being of women and girls, because those people often on low pay will be spending money in their communities, so we all benefit.

There’ve been 63,000 working people who’ve now had a pay equity settlement or offer, and that’s all because of the work that they and unions have done in winning their cases. The Terranova case that Kristine Bartlett was the public face of—that Court of Appeal decision—was a landmark. It recognised that where it had been previously assumed that the Equal Pay Act gave protection against direct pay discrimination where a female staff member was paid less than a male staff member for doing the same job—that Terranova case opened up the possibility of a large number of pay equity claims in historically undervalued female-dominated industries such as, obviously, the aged-care sector.

So what this bill does is it amends the Equal Pay Act 1972 to expressly provide processes that will allow parties to negotiate pay equity settlements. Certainly, the previous Government did introduce legislation, but it was a very complex process that relied on court cases and was full of barriers to claimants. This bill is a vast improvement on that. And can I congratulate and acknowledge the huge amount of work done by both the Joint Working Group on Pay Equity Principles and the reconvened joint working group, and the contribution they have made as a tripartite forum for unions, for businesses, and for Government to discuss just how a pay equity process might work.

There were three key issues that went back to the reconvened joint working group: how high the bar should be for filing a pay equity claim, what comparators should be used, and what legislative vehicle was appropriate. So this Government, the Labour - New Zealand First - Green Government, agrees with the findings of the reconvened joint working group, because it provides for a pay equity claim to proceed if it is arguable rather than requiring that merit be proved, which was a much higher threshold in the previous Government’s legislation. The whole hierarchy of comparators was very contentious in the previous legislation. The reconvened working group looked at that, and, again, we agree with their recommendation that the comparators should be considered as part of a bundle rather than as a hierarchy.

So this legislation is much more straightforward, because it relies on using the existing bargaining framework. It encourages employers and workers to negotiate in good faith, with access to mediation and resolution services. The court process is still available, but it’s not the first option, as was the case under the previous legislation. It’s the process of bargaining rather than the court process, which is where those first conversations take place. Good-faith bargaining is the opportunity to build productive relationships through collaborative processes, and pushing parties into an adversarial court process, making that the default setting, would have been a way of undermining good employment relationships, so the bill is a significant improvement here.

Certainly, this whole issue of back-pay is really important, because parties will be free to discuss back-pay as part of the bargaining negotiations for pay equity. And they may also come to an agreement outside of the courts on their own which may include back-pay. But if they can’t agree, then the court is available to award back-pay for pay equity claims. This Government, though—can I make that very clear—has not introduced the concept of back-pay. It already existed in the current law. And in the bill, there’s a process to guide the court’s consideration of whether to award back-pay and what quantum should be awarded. So we haven’t done what the previous Government did and limited back-pay for existing claims. In fact, the way in which the bill deals with back-pay should provide an incentive for employers and workers to actually get on and deal with this.

Why is back-pay there? The undervaluing of women’s work has come about because of long-term structural discrimination that has suppressed the market rate in those occupations that are dominated by women. It’s been a societal failing, not just the failing of one single employer, so the settlements must strike a balance between looking at that historic structural discrimination and ensuring that women have a right to back-pay. So we do expect that the provisions in the bill will provide an incentive to resolve claims quickly and fairly, because the bill allows an increasing amount of back-pay after five years.

I’m very proud of this bill and the fact that the Government has worked really hard to introduce it, that we have the historic achievement of women winning the right to vote in Aotearoa New Zealand 125 years ago and now this bill being introduced on Suffrage Day in September and going now to select committee. I really look forward to the public making their submissions to improve the legislation if it can be improved and it being reported back and progressing through the Parliament. It is a significant piece of legislation, and I commend it to the House.

Hon LOUISE UPSTON (National—Taupō): I’m very pleased to stand and speak in this first reading of the Equal Pay Amendment Bill and say that the National Party will be supporting this legislation in the first reading and on its way to select committee. I do have to just put on record that this is the third attempt in a less number of years: firstly, with the legislation that was proposed by the Hon Michael Woodhouse, and then a very similar bill proposed by Denise Lee as a member’s bill. So I have to express, at the outset, some frustration in the delays. When the Minister for Workplace Relations and Safety spoke, he did refer to the joint working group that was set up by the previous National Government, and, in effect, the work was continued with the joint working group mark 2, if you like. I think it’s really important, because the work that was started in 2015 really was quite historic in terms of having the tripartite group of Government, unions, and business working very closely together to come up with agreed principles. And I want to come back to that shortly.

I do want to say, though, that legislation of this type—and as I say, this is the third attempt at it—is a step towards achieving pay equity, and that is a significant contribution to reducing even further the gender pay gap. This has been a focus of the previous Government as well as the current Government. That is an area we absolutely agree on. So we have a gender pay gap currently of 9.2 percent. The more it goes downwards, the better. This will not solve all of the problems of the gender pay gap, but it will provide a significant next step.

The other sorts of things that do make a difference, because women’s participation in the workforce is growing at 65.9 percent—absolutely fantastic to see the participation rate that high, but we’ve absolutely got to make sure that structural barriers to them performing well and being adequately rewarded for their efforts are also removed. As my colleague the Hon Nikki Kaye said, it is far broader than just legislation. So for those who are listening to this debate, the bad news is that legislation of this type, although it’s important, is still only a small part of the broader issues that affect women’s participation and their ability to fully and equally participate in the workforce. So I just wanted to make sure that was on record.

Some of the practical things that have been done in our time in office are very simple things like the right of every worker to request flexible work. I will just put in a plea for the Government to ensure that any further industrial relations changes make sure that the gains for women and participating in the workplace are not eroded and there are no unintended consequences for women in those employment relations changes. Another part—again, it sounds quite simple, but the ability to have keeping-in-touch days while women and men are on paid parental leave. Just the very ability to stay connected to their workforce has shown really great results in being able to stay connected and ease their return to the workplace.

I do want to talk though, as others in this debate on Equal Pay Amendment Bill have spoken, about the equal pay settlement: the $2 billion pay equity settlement for aged-care workers. I don’t think there would be anyone in New Zealand that would have disagreed with the fact that aged-care workers were absolutely not getting paid what they were worth, so the accolades have been flowing today for Kristine Bartlett and those that supported her—her union. The one thing I do want to say, though, is that that was an incredibly long and arduous process. So what we do want to see through the select committee process is I’m really hopeful that we will have the ability to pass legislation that means no one else, no other woman, will have to go through the type of battle that Kristine Bartlett did. But that $2 billion that came into effect on 1 July last year raised the incomes of 55,000 women—55,000 women benefited from that settlement. For some of them, that was a pay increase of 15 percent. For others, it was up to 50 percent.

So when I expressed earlier in my contribution my frustration at the delay in passing legislation around pay equity—that’s 18 months that women of New Zealand have not had the opportunity to be paid what they are worth. Every one of those days in the last 18 months, whether they got a 15 percent increase or a 50 percent pay increase, that would have made an enormous difference for them, for their families, and for their communities. So I just have to put on record that I accept that an incoming Government didn’t agree with everything in the previous legislation, but the reality is that when you compare it there’s actually not a lot different. There’s not a lot different. So there would have been ways to ensure that working women of New Zealand didn’t have to wait as long as they have. Unfortunately, it’s going to be a while before this legislation is passed, so they will be waiting even longer.

I do want to say that the Government have recently agreed—Oranga Tamariki has also settled their pay equity claim. That’s a 30 percent increase over a two-year period, and that will have a significant impact on them. The issue, though, that I do want to just put on record is that I’m hopeful the Government is considering the flow-on effect. So it’s fantastic for Oranga Tamariki workers—absolutely brilliant. They deserve it. It’s a pay equity claim, and 30 percent will make an enormous difference to them. But what I do urge the Government to look at is what the impact is on others providing social services, those who work in non-government organisations, or NGOs, who will struggle to adjust to that. So I am hopeful that the Government is considering what that means, what that means for the thousands of New Zealanders—a large number of them are women—who work in those sectors to ensure that they also have the ability to be paid what they are worth.

Of course, when we talk about women being paid what they are worth, this is not equal pay, this discussion. It is not the same pay for the same job; it is the same pay for a job of equal value, and that’s pay equity. I do want to say, having been involved in the early years on this particularly important piece of legislation—I do want to give my thanks to the joint working group members and those who joined for mark 2 of that joint working group.

I also want to pay tribute to officials, particularly in the Ministry for Women. Ministry of Business, Innovation and Employment officials and others have been involved, but the Ministry for Women is a small agency. On this particular piece of legislation, they’ve had a significant influence. They’ve worked incredibly tirelessly on it and they’ve always brought a very different perspective to the table, and I want to put on record my thanks for their work on this legislation.

As I say, National is pleased to support it to the first reading. I would encourage businesses, unions, and workers, to make sure that their views are heard in the select committee. The select committee is a critical opportunity to improve the legislation. So we are optimistic that some of the areas that we have concerns about currently—one is making sure that any additional factors into this, whether it’s the comparators, whether it’s the back-pay, don’t actually make it harder for employees who are currently undervalued to access pay equity and to be successful in their claims. So if there’s a message I can send the Government: please make sure it is accessible, please make sure it is practical, that it is easily understood by both employees and employers, and make sure there are not people who are fed into a process where they wouldn’t have success and waste a lot of time and energy on the way through.

I am pleased to support this Equal Pay Amendment Bill in the first reading, and I look forward to my colleagues’ hard work in the select committee.

Hon TRACEY MARTIN (NZ First): Thank you, Mr Speaker. I rise on behalf of New Zealand First to support the Equal Pay Amendment Bill 2018. There are times when I stand in the House and just shake my head, actually, at some of the things that are being said by the Opposition. I don’t know where Kristine Bartlett is today, but I can only imagine that it must irritate her something shocking to be lauded by the Opposition today, when she was required to take the court case, forced into a situation of years of having to fight for what was now apparently, according to the Opposition speakers, obvious all along. It was obvious all along!

I listened to the Hon Nikki Kaye. I totally support the acknowledgment of the joint working group—the joint working group that the previous Government put together, disbanded, and then completely ignored the majority of the stuff that they said should happen. The joint working group proved a lie to the fact that business and unions cannot work together for the betterment of all. Yet I would have to say to the public, “Go and have a look”, and whenever else the word “union” is mentioned by the Opposition, it’s not often with that same loving tone, I can tell you now. So I do want to acknowledge the joint working group.

I want to acknowledge—again, the last speaker talked about the pay equity deal, the pay equity arrangement that was reached by Oranga Tamariki and the Public Service Association (PSA). That was $114 million over five years—a 30.6 percent increase for statutory social workers employed by Oranga Tamariki. But that didn’t happen by accident. There are a couple of things that need to be acknowledged there. Tina Corrigan, my very, very dear friend Rachael Baxter-Mackay, and Pixie Stockman: three women who had to put their names on a court case to bring that forward under the previous administration because that was the only way this was going to get discussed—for women to actually go to court. What Oranga Tamariki and the PSA have proven, even before this legislation has gone through, is that the way to create comparators collegially, working together as employer and as workers’ representatives—working collegially together to find the comparators is not an issue.

It set the tone for the negotiations once that comparator was established—mutually agreed. So not only should the PSA and Oranga Tamariki be acknowledged for the collegial way that they actually worked through this issue, came up with the comparators the way that the joint working group had said that they should—there was never any drama in it. We need to recall that when, I believe, the Opposition is going to try and go back to what was their preferred way of coming up with comparators—the hierarchy of comparators or whatever—that removed that ability for those representing the workers involved and the organisations and the employers to come up with what is right and what is proper for themselves. They are grown-ups. They are actually able to work together, and we need to start breaking apart the myth that we cannot have this collegiality between employers and unions.

I also want to acknowledge the Rt Hon Jacinda Ardern and Chris Hipkins and this coalition Government, with supply and confidence partners, who did an historic pay equity settlement for education support workers. Hundreds of women who support some of our most challenging young people inside our schools with physical and behavioural needs—back in August 2018, they received their pay equity settlement. That’s going to take some of those support workers from between $16.77 and $19.87 per hour up to a new rate of around $25.70 per hour. That is an amazing lift for some of those women, and quite rightly—

Mark Patterson: Well deserved.

Hon TRACEY MARTIN: “Well deserved.”, my male colleagues shout from behind me, as they should.

I will acknowledge, again, the Hon Nikki Kaye, when she said that this is not just about money; this is about validation—validation of the work being done. Some of the work that women are doing for some of the lowest pay is among the hardest that we have inside this nation, so we needed to make sure that we not only acknowledge it in a dollar value but acknowledge it just across society.

I want to talk for a moment about the back-pay issue, because I know it is causing some people concern. I want to acknowledge the fact that people need to go and have a look at new section 13ZD, inserted by clause 18, which sets out limitation periods that will apply to awards for work performed before the date of the determination—e.g., before it was determined what the appropriate rate should be. It states that the maximum period for which back-pay can be sought is six years in all cases. And this is the point of it. We’ve heard again today, from way back in 1998 to today, that we still have an over 9 percent gap around what the value is of this work, and this has been since the late 1990s. We cannot wait any more. So this is to incentivise both parties to get together and deal with this issue. With 125 years of women’s suffrage, we need to move on and put this to bed. We need to get this sorted, and we need to get it sorted as quickly as possible.

I am very interested—and, again, the Hon Nikki Kaye—in how quickly one shifts position. The Hon Nikki Kaye spoke about, and I think the other speakers from the Opposition side have talked about, how slow this Government has been—it’s been here for 12 months—to address this issue. Nine years—nine years [Gestures to Opposition benches]; 12 months [Gestures to Government benches]. So I think we’re moving with a somewhat rapid speed.

I would welcome the members of the Opposition seeking to truncate the select committee if they think we’re going too slowly. If the Opposition believes that the Government is going too slowly, then I would suggest they can move a motion at select committee that it moves much faster through. Then we can return it to the House and get it into legislation and away we go—all will be right with the world, according to the Opposition. But, again, while sometimes I do stand and shake my head, what I do know about this side of the House is that this Government is moving forward to make New Zealand a better place for all New Zealanders, and this is another step in the recognition that women New Zealanders needed—52 percent of the public needed.

I’m going to make one last comment, and that is around the suggestion that this Government may not be aware of flow-on effects out of the Oranga Tamariki pay equity settlement. We are, and we are working on it, so it’s all right. Calm yourself—sorry, not you, Mr Speaker. The other thing though, too, is around this concept of how many women are in the workforce. I would like to make sure that we don’t decide to set up a target for women in the workforce that forces them into the workforce, unless they wish to be there.

So this is about making sure that we don’t see work as being the be-all and end-all with regard to your value to society. This is about making sure that when women do work, they are paid fairly for the work that they do. Kia ora.

Dr PARMJEET PARMAR (National): Thank you, Mr Speaker, for the opportunity to take this call in the first reading of the Equal Pay Amendment Bill. That was a very interesting contribution. In that contribution, the Hon Tracey Martin kept contradicting herself. On one side, she said that this needs to be quickly sorted, but then the second line was that, “Oh, why is the Opposition saying this needs to be rushed through?” Yes, in Opposition, we want this issue to be rushed through because we highly value this issue.

The whole world is actually working towards this issue that is to reduce the gender pay gap, and National has shown they are committed. We have already demonstrated our commitment, because we had legislation that was introduced in July 2017—July 2017—and that was in the name of the Hon Michael Woodhouse, who the Hon Tracey Martin forgot, actually, to acknowledge. That was the Employment (Pay Equity and Equal Pay) Bill, and the first reading of that bill happened in August 2017. This is now October 2018, when we are debating the first reading of this Equal Pay Amendment Bill. So, yes, there is this big lag. That is why we want to see that.

This legislation should have been progressed by now, which hasn’t happened, because when the Government changed in the last election and the Labour Government came in, the first thing they did was get rid of this bill—got rid of the bill that was introduced by the previous National Government. If they were really keen to quickly sort this issue, they could have worked with us on that legislation, but no. They decided to get rid of that bill, because I believe they have a political agenda behind this bill that is the Equal Pay Amendment Bill. It’s not about the issue; it’s all about their political agenda, because they wanted to own that space. They want it to look like they are the ones that are keen in this kind of issue that is to reduce the gender pay gap.

They thought that people would not remember what National did when National was in Government—but we were so determined. Yes, that had already gone through the first reading. When we came into Opposition, we decided that we would pursue this issue of gender pay gap, and that was through a member’s bill. Again, Government members decided to oppose that, because if they had supported that—

SPEAKER: Order! Order! Can we come to the bill now?

Dr PARMJEET PARMAR: Mr Speaker, I am building the ground for it.

SPEAKER: You’re heading towards it? Very good.

Dr PARMJEET PARMAR: Thank you, Mr Speaker. Thank you. It is important that we remind Government members of the work that National did, because this bill is not very different from the bill that was introduced by National. For Government members to stand up and take the credit, I think they should remember the work of the previous National Government.

Then what happened on the 125th suffrage anniversary? They came up with this bill, the Equal Pay Amendment Bill. If they had worked with us, then we could have actually implemented the bill on that day, instead of introducing a new bill to start all over again, and now we are debating the first reading of this bill. So, yes, we have wasted so much time. We really want to sort this a.s.a.p. We are really keen to sort this issue.

As other speakers have said, we have a gender gap that is around 9 percent. Yes, we have come down from the time we started measuring it, which was around 16 percent, and if we look at other OECD countries, we are on the lower side. Our gender pay gap is lower than so many other OECD countries, but we know that any kind of gender pay gap is not acceptable, so that’s why we want to work towards reducing the gender pay gap.

As we are determined to work on this issue, we have decided that we will support this bill in the first reading to the select committee, because we want to see what individuals and organisations will be saying about this bill, and we also want to have the opportunity to work with Government, to work on this bill to make it better. We do have some reservations, and that is why we are saying that we will be supporting this bill only in the first reading at this stage. We want this bill to go to the select committee because we understand this is a very important issue.

The issue of equal pay and pay equity, which this bill is to address, is a very complex issue—we all understand that. And this issue cannot be fully resolved by legislation, but, yes, legislation is needed. So there are different components of this issue, which is a very complex issue, where we need different kinds of legislation. And this is one kind of legislation that is to address that issue.

Looking at the contributing factors, we know that there are some professions that are female-dominated and there are professions that are male-dominated. Female-dominated professions are paid lower than male-dominated professions, and that needs to be addressed. We also know that we have fewer women in leadership roles, but reminding everybody that National worked really hard, and now we have a record number of women on State sector boards. So that was to highlight the importance of women’s contribution to our economy at different levels.

We also know that some women want to work part-time hours, and that is a reason why we have this gender pay gap. For that, we introduced flexible work hours, and also keeping-in-touch days, so that when people are on paid parental leave, they have this ability to stay in touch with their work, so that they don’t have to start again from the bottom, so that they don’t miss out on the opportunity to get promoted or have higher positions in the profession that they are in. So we did all those things, but then there was a study where it said that 80 percent of the reasons why the gender pay gap exists are unknown. And that is what makes me really curious, and I believe that comes down to some form of bias—some form of conscious or unconscious bias which needs to be addressed, too. For that, we need to have continuous dialogue about this issue, so that we are raising awareness along with working on legislation.

In this legislation, as I said, we have some reservations. One thing that I want to highlight is that this legislation is different from the legislation that we introduced, in, actually, a few parts. One part that is different is the system that we wanted the claim to follow. They have removed that structure, that system that we wanted a claim to follow. What they want is, when you’re looking at a comparable profession, they are thinking that you can go really wide. What we think is that the place where it should start should be from within the profession or sector, if appropriate, or if available. So that is the structure that we wanted to put in place through our legislation, which is not included in this legislation. So I believe that this change, actually, is not going to solve the problem; it is actually going to create more problems for those people who will be making claims. We want to make sure that the process is simple. To keep that process simple, people should know where to start and which industry to look into to start with, and then the direction that they can go in to make sure that they are not wasting their time and their employer’s or the court’s time.

The other thing I noticed in this bill is that they have reduced the time for the employer to respond, and I simply don’t understand the basis for that—reducing that from 90 days to 65 days. Why reduce that from 90 days to 65 days? I simply don’t understand that, because the employer needs to be given proper time so that they can respond to that claim. Putting that kind of pressure on employers I think is just unnecessary.

The legislation that was introduced by us was based on recommendations made by a joint working group—and yes, the joint working group had representatives from Government, unions, and employers. What happened? They came up with recommendations which were in line with our employment framework and also our labour market. Then what happened? Labour decided to reconvene the group. What happened was that group actually reconfirmed the recommendations which were made by the previous joint working group. So I don’t see the basis for these changes in this legislation and putting this unnecessary kind of pressure on employers by reducing the number of days that they get to respond from 90 to 65.

Overall, as we said, the aim of this bill is to address equal pay and pay equity issues. That is why we are supporting this bill in the first reading to the select committee stage. We are really keen to hear from the sector. We are really keen to hear from organisations that employ women, men, and, of course, sectors that are male-dominated, sectors that are female-dominated, and what they have to come and say on this bill in the select committee process. And we would be really keen to see that the Government is willing to work with us on this bill. Yes, we are in Opposition, but we are willing to work with them on these kinds of important issues. We have clearly seen that they are not, because they dismissed two bills that were put forward by National’s team—that was once when we were in Government, and the second time as a member’s bill. And they completely dismissed those bills. They didn’t want to work with us, but we are willing to work with them. So I am supporting this bill in the first reading so that it can go to the select committee. Thank you, Mr Speaker.

Hon JENNY SALESA (Minister for Building and Construction): Fakalofa lahi atu Fakatonu, Fono Taane.

[Much greetings, Mr Speaker.]

It’s language week for Niueans, and it is a great opportunity to celebrate Niuean language here in the House of Parliament. Fakalofa lahi atu kia mutolu oti.

[Much greetings to you all.]

Thank you for this call on the Equal Pay Amendment Bill, Mr Speaker. I would, first of all, like to acknowledge and thank Kristine Bartlett and her union, E tū, for her courage and perseverance, and thank the union for supporting Kristine to ensure that we get to this day and that we address equal pay. I’m humbled to be a woman who is a Minister in this Government, and really honoured to be speaking in support of this historic legislation today. The Equal Pay Amendment Bill will establish a fair and accessible process to address the historic pay inequities that women in Aotearoa New Zealand are currently facing.

One of the things that we’ve heard from the previous speaker, Parmjeet Parmar, as well as the Hon Nikki Kaye, was about how slow our Government has been to address this issue. We haven’t even been here 12 months. The previous speaker spoke about how they had a bill that was ready in 2017. The previous Government had nine very long years. If they were as committed to addressing equal pay as the previous speaker said they were, they should have addressed it within those nine long years. They shouldn’t have left it right until the end of their tenure of nine years before addressing it if, indeed, they were committed to addressing equal pay.

SPEAKER: Order! I’m now going to call the member to address the bill. I think that theme has got to the point of being tedious repetition.

Hon JENNY SALESA: The Equal Pay Amendment Bill provides clarity on what equal pay should be, what the process should be for addressing pay equity. We know that discrimination has led to lower pay for many of our female-dominated industries. We also know that this is despite having similar qualifications, having the same skill requirements, and, in many instances, for some women it’s despite having higher qualifications or many more years of work experience. They are still not being paid comparable pay to folks in a male-dominated occupation.

As a Government, we are committed to growing and sharing prosperity in a fair way. Taking action to close the gender pay gap, as well as to address this issue of historical undervaluation of work that is predominantly performed by our women, is one of things that our Government is doing with the introduction of this legislation.

It is of note that the Equal Pay Amendment Bill was, indeed, introduced to this House on 19 September—125 years to the day since the fight for women’s right to vote was won. The suffragettes that took the cause of pay equity in the 1800s understood the huge significance of equal pay. They saw the battle that would follow. After winning the vote for women, that was going to be their next fight. I don’t think they could predict that 125 years later, we would still be having this discussion. I don’t think they foresaw that 125 years later, we would still not be there.

New Zealand women, over the years, pressed hard for pay equity, and they achieved the Equal Pay Act of 1972. However, we’re still not there yet in terms of pay parity. This Equal Pay Amendment Bill will make it easier for workers to make a pay equity claim. It will allow workers to use accessible processes to raise their claim within New Zealand’s existing bargaining framework, setting negotiation rather than court processes at its core.

Poverty and inequality are real issues that are facing too many of our women nowadays. I wish to acknowledge that when we talk of equal pay, there are many of our women—especially Māori women, Pacific women, and ethnic communities women—who are bearing the brunt of this burden, in many instances. The hourly wage rates for men and women already show women at a disadvantage of 9.2 percent, but when we look into further details of that disparity, we know that many Māori, Pacific, and women of ethnic communities tend to earn sometimes $6 per hour less than women of other ethnic groups. This is not right. It is not fair. It is not equitable, and this bill is one way this Government is taking action to ensure that we address that.

My colleague the Hon Iain Lees-Galloway has already outlined the history and the approach for this bill, but I must note that the bill before us does not include any of the hurdles that were planned by the previous Government that would have made it too hard for many working women to raise pay equity claims in reality. The previous National Government’s bill took a limiting approach to pay equity claims. It was criticised by stakeholders, hence our decision to rework it with the assistance of the reconvened joint working group. This has resulted in a much better bill and a much more balanced and practical bill. I strongly support this bill, and I commend it to the House.

DENISE LEE (National—Maungakiekie): Thank you, Fono Taane. [Mr Speaker.] It is my pleasure to speak on this bill in Niue Language Week and to attempt to acknowledge that with my limited abilities.

It’s with a strange combination of déjà vu and frustration, I have to say, that I stand up to take a call, late this afternoon, on this bill, the Government’s newly introduced Equal Pay Amendment Bill. The frustration is driven not by an opposition to the bill itself, because we’ve clearly outlined that we will support it to its first reading. That’s the right thing to do. The National Party supports this bill because achieving pay equity is our next hurdle that we need to cross as a society, and we all acknowledge that. Closing the gender pay gap and achieving pay equity in New Zealand is incredibly important to us all. It’s a principle the National Party supports and one that we have championed. As you know, we got to this first, and, for reasons I’m about to explain, I have a sense of pride in seeing this legislation achieve its first reading today. So the issue is not the bill itself.

My frustration is instead because of the date. Today is 16 October 2018. It has been—let me get this right—eight months and 24 days since my member’s bill titled Employment (Pay Equity and Equal Pay) Bill was pulled from the ballot. It has also been one year, two months, and 20 days since my colleague the Hon Michael Woodhouse first introduced the content of that bill to this House. In that time period, spanning over more than one year, this Government has blocked progress on pay equity on two separate occasions, and you can’t escape that: once, when they blocked the bill from being reinstated back on to this Parliament’s agenda—the 52nd Parliament’s agenda, otherwise known as the Order Paper—and again when they voted it down on the first reading of my member’s bill. They railed against the bill back then in March, and their opposition was well-known.

SPEAKER: Order! Order! I’m going to bring the member to the bill currently before the House now, as I did with the previous speaker, Jenny Salesa. Thank you.

DENISE LEE: Will do so, Mr Speaker. I intend to refer to the joint working group’s principles, which the bill is undergirded with, and also point out the three main differences. So thank you, Mr Speaker—will do.

Jacinda Ardern mentioned very clearly, in regards to that bill—she said the words “How is it possible that we could introduce a bill that took an entire generation backwards in terms of our ability to achieve pay equity?” Well, you can imagine my shock when this bill here that we’re addressing this afternoon was tabled and I was able to see that 90 percent of that bill is word for word what we introduced, and that’s the reality and the stark reality—word for word.

Now, if you don’t believe me, I’ve got a copy of the bill here, and in it I’ve highlighted the yellow. That is exactly word for word what was in the bill that I introduced as my member’s bill. That’s a lot of yellow. The pages keep going. I think I’ve just turned my sixth or seventh page. The yellow is the exact—

Hon Member: You must have gone through one yellow highlighter.

DENISE LEE: —same content. Apart from the fact that I ran out of highlighter ink, it’s a cynical move by this Government. They slammed that bill when it was first introduced earlier in the year. They reconvened the working group that based the same principles—they did a shabby copy and paste job and introduced their own nearly identical version. Now, pay equity is an important issue for New Zealand, and the Government has delayed progress for months just so—and here’s the reality of the situation—they could grab their Suffrage Day photo op. That’s exactly what happened, and it’s shameful. They’re playing politics with pay equity. They turned it into a political game where both sides are trying to one-up each other, but all around and all the while women in New Zealand want and need real progress and real movement towards pay equity.

Now, if you go through this bill, you can see that the Government’s made changes, and we’ve heard them stand up and say that these changes were necessary to make it a better bill. But I want to point out that the Government could have easily made these changes at select committee or at committee of the whole House—again, another stark point of reality. Had they not blocked the earlier versions of this bill, remembering how similar the content is when I showed you it, highlighted in yellow, they would have had—I’ve clocked up—four opportunities to amend or make the bill into what they now see, and what we see here this afternoon, as their version.

Now, last month, Iain Lees-Galloway and Eugenie Sage stood outside Parliament on the steps announcing the introduction of this bill here this afternoon. Had they done the right thing months and months ago, rather than this bill just being introduced on Suffrage Day we could have actually signed this bill into law on Suffrage Day. Imagine that. On the 125th anniversary of women’s suffrage, we could have had the Governor-General, Dame Patsy Reddy, who also, incidentally, was the head of the joint working group—

SPEAKER: Order! Order!

DENISE LEE: —sign this bill into law. That’s what we could have had. What a symbol of progress that could have been, instead of what we now see as, between now and then, wasted time.

Now, I want to finish up my time refuting the claim that the changes that have been made in this bill have resulted in better outcomes than our version, and I’m going to go through the three main differences. I’ve talked at length about the similarities, because we can see, highlighted in yellow ink, exactly what those similarities are. So the main differences are—and I’ve got three—number one, the Government removed our hierarchy that should have been used when finding comparable professions. So was that cynical on our part to have that hierarchy? No. We needed a pragmatic method to ensure structure when looking at claims. It’s not easy, but you had to start with something. That’s gone.

Number two: they’ve loosened the criteria to determine if a job is undervalued. We had both historically and currently undervalued; this version says either. Where will the line get drawn? That’s a legitimate question. Why is it that Dame Patsy Reddy and the joint working group determined that it should be both?

Point three: they’ve changed the criteria, in this version, that a claim must have “merit”, to, now, must be “arguable”. Again, Dame Patsy Reddy highlighted—

SPEAKER: Order! Order!

DENISE LEE: —that merit was the way to go.

SPEAKER: No, sorry—[Interruption] Order! I’m just going to interrupt the member for a second. The convention in the House is that the Governor-General is not brought into the debate unless it’s absolutely necessary. I think if the member just refers to the chair of the working party, or something like that, that is an appropriate approach.

DENISE LEE: Thank you, Mr Speaker. I’m happy to do so. When we look at the word “arguable” versus “merit”, my main point here is who benefits from the word “arguable”—lawyers. That says it all, and in my closing comments the major change inside this version of the bill—well, the 10 percent that was actually changed—is that this Government has left the door wide open for the same long, protracted bouts of litigation, and breakdowns in negotiations that inevitably end up in court.

We support this through to select committee, but as a House we’re going to have to be honest and as a select committee—and I’m really grateful that I’m on the particular select committee that this will be going to—we’re going to have to be very, very honest with ourselves and ask if we are legislating for true change here or are we legislating for more of the same types of battles that we’ve seen before. We would argue that the small amount of change that has been introduced here this afternoon is going to send us down many of those same tracks; namely, long, protracted court battles, and the women of New Zealand not only deserve to have this brought into the House long before now; they also deserve to not have the same cycles of frustration. We support this bill to its first reading. Thank you for the opportunity to speak and to speak doing so in Niue Language Week. Thank you.

JAN TINETTI (Labour): That was quite an interesting contribution there from the previous member, Denise Lee, on that bill. I’m looking forward to it coming to our select committee because it might be an opportunity to help the Opposition understand just how powerful this bill is and what has been added to this bill. This bill has followed the recommendations—all of the recommendations—of the original and reconvened joint working group to make it fair and equitable, restoring fairness and equity into the workplace, and to get rid of the hurdles that had been put in by the previous Government.

This is actually a really good day that we are seeing here—seeing this bill coming to the House—and I’m really proud in this anniversary of the 125 years of suffrage that this Government is bringing this bill here. It was only last year in the campaign that I had a group of young women who came to me and asked whether I ever foresaw that we would one day see equal pay as being as being part of the norm, like voting is part of the norm for women now, like suffrage is a historical event—did I ever see that we would talk about that as a historical event? I said, “Yes, just watch what happens.”

Twelve months later, here we are as a Government that is putting this right, and I am really excited to be here in this House today talking about this bill. Well done to the joint working group. Well done on them coming up with these recommendations, and I am proud to be in the Government who have listened to this. I am very, very proud to say that I commend this bill to the House.

NICOLA WILLIS (National): Mr Speaker, fakalofa lahi atu in this Niue Language Week. I rise to speak on the Equal Pay Amendment Bill. What this bill is about is a very simple concept, and I thought about how I would explain this bill to my two daughters if I was to get them to understand the significance of this issue. It’s simple, isn’t it? A man and a woman should be given equal pay for the same job. If they are doing the same job, they should get the same pay. And a man and a woman who are doing different jobs but jobs of equal value should get the same pay. And those two simple concepts underpin this bill and are the point of connection between both sides of the House in this debate. Those two concepts we in the National Party agree with wholeheartedly and have taken considerable steps to progress during our time both previously in Government and over successive generations.

Having taken that simple concept, we then need to look at what progress there has been on those issues for New Zealand and why it is that this legislation is in fact required. In some senses, you could argue that the direction of travel is good. Even in my lifetime, progress on pay equity has increased dramatically. In 1998, when I was a 17-year-old, the pay gap was 16.3 percent, and that has now reduced to 9.24 percent. So I would say to my daughters, “If that much is possible within my lifetime, imagine how much is possible within yours.”

So we know that progress is possible, but when we look at where this bill came from, we have to acknowledge the history that has brought it about. In the Equal Pay Act 1972, we had a piece of legislation with good intent, and it was in recent history, in 2014, that the Court of Appeal found in the Terranova case that that Act did imply that the Equal Pay Act did include that concept of pay equity—that a man and a woman doing different jobs of equal value should be given equal pay. So the National Government established in good faith a joint working group to develop pay equity principles. That process led to the development of legislation that had been very well-thought-through, and that was introduced in 2017.

It was that same year that Kristine Bartlett had her incredible win, which led to a $2 billion pay equity settlement. I’ve heard in this House on many occasions when members opposite have brought into question that settlement saying, “Oh well, it doesn’t really count because National didn’t want to do it.”, and I just want to put on the record very clearly that National did it because we wanted to do it—

Hon Members: Ha, ha!

NICOLA WILLIS: —and that we believed that that settlement was the right settlement, and that we backed the 55,000 aged-care workers who benefited from that settlement. We take pride in the fact that that was the most significant pay equity settlement in New Zealand’s history and it was delivered by a National-led Government. [Interruption] Beyond that settlement, we did introduce legislation in good faith, and why did we do that?

SPEAKER: Order! Sorry, I am going to interrupt the member. I know that when members say something inflammatory, they can expect to have a degree of barracking coming back at them, but I think it has gone too far.

NICOLA WILLIS: Mr Speaker, isn’t is sad that it’s inflammatory to claim something which is true in the historical record—a settlement that was delivered by a National Government—and that it pains members opposite so much that they can’t put their Labour red flag to something that we too are proud of.

Now, when it came to introducing this legislation, the Government was very clear of what we were trying to do at that time, and that was to ensure that people wanting to progress pay equity claims in the future wouldn’t have to be tied up in an endless court process—that, in fact, negotiation could be a way through these sorts of claims into the future; the sort of bargaining process that exists elsewhere in employment law. So, of course, this bill that we are debating tonight picks up on that concept, and as previous speakers have said, including Denise Lee, whom I want to congratulate for her great work in progressing this via a member’s bill earlier this year, being thwarted only by members opposite, what we see is that this bill picks up on that and makes very minor changes that could be significant. A select committee will have to consider that in due course, but it really reminds us of how petty politics can sometimes be—that a Government would withhold a bill so that it could be reannounced on Suffrage Day, when in fact they couldn’t have it—

SPEAKER: Order! The member’s time has expired.

MARJA LUBECK (Labour): Tēnā koe e Te Māngai o Te Whare, and, because it’s Niue Language Week, fakalofa atu. I am delighted to take this call on the Equal Pay Amendment Bill, but I’m unsure where to start with the barrage of information that we’ve received from the other side.

Several members have talked about this being a third attempt. Well, if that is so, I would say third time lucky, because women would have been very unlucky had any of the two previous versions gone through. They in fact would have kept women in discriminatory low pay rates for a very long time. Now, the hierarchy of comparators is something that the member Denise Lee had highlighted, and, whilst this may have been a very small change in her mind, this, in fact, is an absolutely incredible difference to this bill. What the hierarchy of comparators in the previous bill did was deliberately reversing the court decision. That hierarchy of comparators was designed to keep women from ever being successful in future pay equity claims, so what this Equal Pay Amendment Bill does is much better. It includes the comparators that are completely in line with the recommendations of the working group and of the Terranova decision.

So let’s look at that Terranova decision, because mention was made by Louise Upston that nobody should go through the battle that Kristine Bartlett did. Kristine Bartlett and her union, E tū, went through a more than five-year-long battle and were dragged all the way through all levels of courts.

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

MARJA LUBECK: Tēnā koe, Mr Assistant Speaker. Before we had kai time I had a couple of minutes to speak on the Equal Pay Amendment Bill, and I appreciate the opportunity to add a couple more on to it, if the whip allows. So, just to recap, this is a good bill, unlike the versions that the National Party would like us to believe were just as good. In fact, what they would have done is they would have kept women on discriminatory low pay rates for a long time.

I talked about the fact that the member Louise Upston had mentioned that nobody should go through the same battle that Kristine Bartlett did. What really happened was that Kristine Bartlett and her union, E tū, were dragged through all levels of court over five years before a settlement was finally agreed to. Because the then National Government didn’t want to see any other women win the same battle that Kristine Bartlett and her union had just won, they tried to force legislation through that would stop any future claims—with a majority of one vote, I may add, they tried to force that through. So it’s a bit rich for the member Nicola Willis to stand up in this House and refer to the care and support workers settlement as something that the National Party wanted to do, because all actions prior to that settlement and all of the actions after the settlement reinforce the fact the National Party wanted to stop women from achieving any future pay equity claims.

When the member Denise Lee spoke in her speech, she referred to the previous National Government bill as a pragmatic structure, but, in fact, what this pragmatic structure was was a hierarchy of comparators that would have for ever kept women on their low pay rates. Shame on Opposition members for standing in this House and making the comments they have on this particular piece of legislation. They must have forgotten that pay equity campaigners and all those who were very closely involved with that settlement all disagreed with the National Government’s bill and disagreed with the member’s bill earlier this year. In fact, Kristine Bartlett’s lawyer in the pay equity settlement for the aged care workers had referred to the National Government’s bill as dreadful.

So, in a few bullet points, I’ll wrap up now what this bill does: it sets a lower threshold to raise a claim; it provides a simpler, easier, and more cost-effective process to progress a claim; it also allows parties to set their own comparators—that is a really crucial one—and it allows for back-pay. So, concluding, this bill provides an opportunity for our lowest-paid workers to have one decently paid job rather than having two or three to try and make ends meet. Instead of spending time to go from one to the other job, trying and struggling to feed and care for their whānau, they can have one decent job and spend time with their whānau. This is hugely important, well-overdue legislation. This is the bill that gets it right, and I commend it to the House.

DAN BIDOIS (National—Northcote): Fakalofa atu and happy Niue Language Week, Mr Assistant Speaker. I’d just like to also say a very special hello to my nephew—my godson Zion, who is part Niuean—at home: I hope you’re doing well and building on your Niuean language skills this week.

It is my pleasure to take a call on the Equal Pay Amendment Bill and to represent the other side, that is, the side of men who want to see women in New Zealand paid the equal value for the work that they do. It’s a privilege, certainly for the member for Northcote, which is where I represent—I certainly want women to be paid the equal value, not just in Northcote but, of course, in New Zealand.

I want to respond, firstly, to the dribble that I just heard from the Government benches. This member, Marja Lubeck, talked about what’s dreadful. I tell you, what’s dreadful is that we’ve lost 12 months of equal pay claims because this Government decided to turn down not one but two bills of a similar nature, just so they could bring their own bill to the House today. I just think that’s a waste of time and it’s disappointing for the women of New Zealand who have lost that opportunity to take their claims under what is, I think, a very good bill, and we’ll be supporting it at that.

I do want to commend the Minister, the Minister for Workplace Relations and Safety, Iain Lees-Galloway, for bringing this bill to the House. Its purpose, just to remind those watching at home, is to eliminate and prevent discrimination based on sex, and that discrimination in respect of remuneration or any other conditions of employment, whether it be fringe benefits and the like, and, in doing so, to promote an enduring settlement of claims related to sexual discrimination.

I do want to acknowledge that there is a problem, and although we have made progress—having a gender pay gap nationally going from 16.3 percent in 1998 down to a lower rate of 9.2 percent in 2018—there is much more to do on this. I do want to acknowledge that the problem exists not just at the company level but also at the industry level and at the country-wide level as well. I come from the private sector and I have had many colleagues who believe that they have been unfairly discriminated against in terms of their pay, but they haven’t had the right mechanism to address that. I certainly know that they will be supporting a bill like this through the House.

I do want to acknowledge, though, the work that is being done by the many businesses throughout New Zealand to address the pay gap for women in New Zealand. I come from a “big four” accounting firm, and they have made big strides in not only publishing and making widely available their pay gap by tenure in organisations but actively trying to promote cases where they can reduce the gap in gender pay. So I think something we are proud of in the National Party is that it’s not all up to Government legislation to address these problems. I do want to acknowledge the many businesses that are taking strides and making headway, and I think that from a values perspective we want to see more of these businesses make strides in the future with respect to gender pay.

I do want to just explain a little bit about the bill, as I see it, for the people at home. Absolutely an advantage of this bill is that it does make strides towards closing the gender pay gap. It provides a clear and step-by-step process by which people who are not happy with their pay or who feel like they’re being discriminated against can take their claim and make that widely shared. I want to distinguish three general buckets, if you please, of claims that the bill makes reference to. The first is around equal pay claims, which are claims of discrimination with respect to the dollar remuneration. There’s also unlawful discrimination claims that this bill also makes clear, which is discrimination based particularly around the fringe benefits and other conditions of employment as well. Finally, there’s the pay equity claim, which is a rate of remuneration paid for work that is mostly performed by females that is less than male-dominated professions of equal value. Currently, the Equal Pay Act is not equipped to deal with this and so we in the National Party recognise that this bill, in fact, provides a mechanism for claims in any of these three scenarios to be brought forward and resolved in a timely and accurate manner.

Why do I support this bill? I support this bill to select committee because I’m proud that our party supports equal opportunity and equal reward for work of equal value. We in the National Party encourage people to strive and we encourage people to use their best talents to the fullest, whatever your gender. Women deserve equal pay of equal value, and I want to acknowledge, of course, that we celebrated Suffrage Day, so it’s not lost on me, the importance of this bill at such a time that we celebrate such a momentous occasion. But the current process is difficult, it’s often expensive, and it’s cumbersome. I think the case of Terranova Homes and Care and the service and food workers’ union, which Kristine Bartlett led so amicably, demonstrated that we absolutely need to look at ways to make this a lot better—it’s certainly cumbersome and expensive and risky—and that’s what this bill does. It allows claims to be put forward and addressed in a timely manner, and this bill identically addresses that.

I do want to raise one very important note, which is: why didn’t the Government support previous bills like this one? As my colleague Denise Lee said, 90 percent of this bill is exactly the same as my colleague Denise Lee’s member’s bill that was put forward in the House several months ago. Why did this Government not support that bill? What about the—[Interruption] I’d call the members to outline it, because it’s not clear. I’ve listened to every speech in the House tonight, and it’s still not clear to me why a bill that was 90 percent of this bill wasn’t taken forward to select committee, which you guys could have made amendments to. They have the overwhelming majority on that committee and, unfortunately, they didn’t choose to do that.

Simeon Brown: Underwhelming.

DAN BIDOIS: Underwhelming. They also rejected a bill that we had put forward in the name of the Hon Michael Woodhouse which, again, was very similar, and there’s no evidence to suggest that they’ve done this for any other reason than that they want to claim the credit for this bill. I say to them, shame on them—that’s 12 months when women could have been able to advance their claim under this bill and, unfortunately, tonight, we’re 12 months into that delay.

National supports good bills, regardless of where they come from. We have supported the Comprehensive and Progressive Agreement for Trans-Pacific Partnership legislation, which is now going through the House. We’ve supported the military justice legislation. We’re going to support the zero carbon bill. We in the National Party don’t care if the Government gets the credit. We’re prepared to take pride for the benefit of New Zealanders so that they can have—

ASSISTANT SPEAKER (Adrian Rurawhe): Order! The member’s time has expired.

JAMIE STRANGE (Labour): Tēnā koe e Te Māngai o Te Whare. Faakalofa lahi atu. I’m proud to speak about the equity pay amendment bill. This Government is committed to growing and sharing prosperity more fairly. This includes taking action to close the gender pay gap and to address issues of historical undervaluation of work done predominantly by women. The Equal Pay Amendment Bill will make it easier for workers to make a pay equity claim—and that’s what’s at the crux of this bill—by using a more simple and accessible process within New Zealand’s existing bargaining framework. The bill establishes a just and practical framework to address pay discrimination in female-dominated occupations. It’s an important step in improving fairness in the workplace. The legislation clarifies what a pay equity claim is and what the process for addressing it is. Discrimination has led to lower pay for many female-dominated industries, despite having similar working conditions and skill requirements to comparable male-dominated occupations.

This bill followed all the recommendations of the reconvened and original Joint Working Group on Pay Equity Principles without any of the hurdles planned by the previous Government that would have made it too hard to raise pay equity claims, and that’s one of the key differences between these bills. The National Government’s bill took a pinched and restricted approach to pay equity claims. That is why it was widely criticised by stakeholders and why we decided to rework it with the assistance of the reconvened joint working group. This bill strikes a much better balance. There is a big difference between the two bills. I am very proud to commend this bill to the House. Thank you.

Bill read a first time.

Bill referred to the Education and Workforce Committee.

Bills

Education Amendment Bill

In Committee

Part 1 Amendments to principal Act

Dr PARMJEET PARMAR (National): Thank you, Madam Chair, for this opportunity to take this call in the committee stage of the Education Amendment Bill. I would like to talk about clause 4 and clause 5 in this bill, and for that I would like to speak to Supplementary Order Paper 121, which is in the name of the Hon Nikki Kaye.

So if we look at clause 4, it is to give effect to the objective of the bill—that is, to get rid of national standards. When I look at clause 5, again, the objective of clause 5 is to give effect to the same policy objective—that is, to get rid of national standards. What this Supplementary Order Paper in the name of Nikki Kaye proposes is to delete clause 4 and also to delete clause 5. I am taking this call to support that, because clause 4, as it reads, says it is to amend section 60A(1)(ba) to remove the requirement that the Minister publish national standards, and then clause 5 amends section 61(4)(a) so that a school charter is no longer required to include the board’s approach to assessing students against national standards.

We know that the Labour Government has been against national standards, so this legislation is to give effect to what the Minister actually announced last year—that is, in December 2017—that they will be getting rid of national standards in 2018. We oppose these clauses in this part because we believe that national standards actually help students with their basic reading, writing, and maths skills, and that national standards should be retained in our education system.

When we introduced national standards, there was a lot of work that was done to bring national standards in, in the form that they were introduced, because for any kind of subject interest for students, it’s necessary that they have some basic reading, writing, and maths skills. So national standards as a reporting mechanism for children’s achievement in reading, writing, and maths becomes important, and it becomes important because it’s important for parents to see how their child is doing in school. With that, I believe that the parent will want to get more involved with their school to help their child to do better, because they’ll understand in that big picture—that national picture—where their child actually stands when it comes to reading, writing, and maths.

Yes, I can understand the Minister—I’ve read some reports in the media. The Minister says that some children could be taking up some subjects like arts and other subjects. That’s fine, but give me a list of any professions that do not require those basic reading, writing, or maths skills. Everything requires some basic reading, writing, and maths skills, so why not have a proper measure in place where we can see what students are achieving in schools and have a proper reporting mechanism for parents to see how their child sits in the whole big picture? This is not to discourage; this is actually to encourage, to help the students do better so that they can understand where they are and where they need to work more to achieve better outcomes.

Everybody—yes, we understand—every individual has a different capability, and, similarly, students, even in one classroom, have different capabilities. We are not saying that everybody has to have the same capability. Children have different abilities to learn different subjects, and that’s why some form of reporting, that we had put in place through national standards, becomes even more important. What we have seen is that the Government is really keen on getting rid of national standards but we haven’t seen anything that is being put in place instead of national standards which gives that assurance that parents will get proper reporting of the progress of their child in school. We believe that this move is pushed by unions. Actually, the voice of parents should be taken into consideration in this legislation. So we strongly oppose these two clauses, clause 4 and clause 5, and I fully support the Supplementary Order Paper in the name of the Hon Nikki Kaye to delete clause 4 and also to delete clause 5.

National standards, we know—we implemented them when we came into Government. These kinds of things do take time to sink in, to show us some real results. We also know that the data that is held from the reporting is not that concrete, so I think the Minister of Education should instead focus on having better data so that we know where we should be targeting our resources.

SIMEON BROWN (National—Pakuranga): Thank you, Madam Chair, for the opportunity to take a call on the Education Amendment Bill. As Parliament debates this piece of legislation, I think it’s important to reflect on what this piece of legislation does. On this side of the Chamber, the National Party will be progressing a number of Supplementary Order Papers, covering a range of the issues in this bill, to try to ensure that we at least protect some of the provisions in the Education Act which are essential to our young people and to the future of our country.

What this bill does and what it seeks to do is it removes the national standards, removes the partnership school model, changes the council membership of our tertiary education councils and polytechs, and a range of other things. But I think the thing which Parliament will be incredibly interested in, and the public are certainly very interested in it, is the way in which this bill is being used to remove the partnership school model. The sad reality is that the Minister who’s sitting in the chair now, Chris Hipkins, has already done everything he can to undermine—before Parliament has even voted on this legislation, before it has even become law, he’s already gone and closed these schools down. He’s already ensured that this model is taken away from being able to be used. He’s ensured that the schools have had to go through a process where those schools are being closed down, and they have not had the opportunity for proper and good consultation throughout.

I think that’s clear by the way that we on the Education and Workforce Committee, part-way through the select committee process, had to take Supplementary Order Papers put forward by the Minister of Education to try and fix this legislation, to ensure that the shifting of these schools from partnership school models to other models would be able to be done with at least semi-satisfactory mechanisms. I can tell the Minister that even the provisions that are in this piece of legislation are still not satisfactory, and we on this side of the Chamber will be putting forward a number of Supplementary Order Papers to try to address some of the inequities which he is putting into our legislation, putting into law.

I think the saddest thing about all this is that while we are in this committee debating this legislation—and we’ll be talking about different clauses throughout the evening and into tomorrow—we look at these clauses, and, yes, they’re words on paper, but this legislation is going to make a dramatic impact on some of the children in our most disadvantaged communities. These are children who have failed year after year in education, for a variety of reasons, and partnership schools were the only thing which said that they’re good enough, that they’re smart enough, and that they’re able to succeed and have the opportunity to get an education in this country and be able to succeed as New Zealanders with the same opportunities that we have had—and this Government is getting rid of it. This Government is getting rid of that model.

There’s only one reason why they’re getting rid—well, there are two reasons why. One reason is because they know best. This Government knows best! This Government thinks they have all the answers to all the problems and that anyone else who might have a solution is wrong. Well, that is a completely flawed ideology to run our education system with, a completely flawed education system that this Minister is trying to envision for New Zealand. These schools have had a dramatic effect on these young people’s lives, a dramatic impact. The results speak for themselves but are being ignored by the Minister of Education. So I ask the Minister of Education to talk about the results that these schools are having, the positive impact that they’re having on the lives of the individuals, and the positive impact that they’re having on the communities which they are in, and to tell the committee whether he’s actually gone, during this consultation period, and visited one of these schools and whether the Prime Minister has visited one of these schools to try and really understand.

The second reason is because this legislation is being requested by the unions. This is a Government which is doing this and closing the partnership school model because the unions want to have control throughout our education sector. They don’t like the fact that in some instances, in some schools, there may be a slightly different way of running the schools where, actually, those schools might be able to choose registered teachers to work for them who are able to be paid slightly differently from what the unionised contract might be. They are closing this down so that the unions have complete and utter control over our education sector. That is the second reason why this Government is wanting to close down this model. Firstly, they think they know best, and, secondly, they want the unions—their union mates—to have control over the education sector.

The reality is that these schools have been making a positive difference, have been making an incredible difference in our community, and that is why we will be standing beside these schools, standing beside these young people, standing beside their families, and standing beside their future and saying that, actually, these young people know what is best for them. These young people know what they want from their future, and they know where they want to go. These families and these communities know and have aspirations for the young people and want to see them succeed and will be doing everything that they can, but this Government is taking away those opportunities.

So we’ll be putting forward a range of Supplementary Order Papers in this debate to amend parts of this bill. One of the Supplementary Order Papers that I am putting forward, Supplementary Order Paper 119, is to amend clause 2, which is the commencement date. That’s part of the debate. There’s another clause that we’ll be doing in regards to the establishment board of trustees for new State schools being opened to replace a closing partnership school kura hourua. It will be made up of the board and of the corresponding and closing partnership schools. So we’ll be addressing some of the inequities that this Government has put in place, because the reality is that when the Prime Minister stood up in the House, she said that there will be, essentially, three things in regards to these schools when they’re closed: that she won’t close the schools if they teach the New Zealand Curriculum, if they employ registered teachers, and if they also have results. Well, these schools met all of the three criteria that our Prime Minister told the House they should have, but the Minister and the Government have decided to close them down without proper and due consultation.

So I challenge the Minister to get up and explain to the committee and explain to these schools and explain to the children and young people who attend these schools the consultation process that has gone through, and tell us why he thinks it has been adequate, and tell us why he’s had to put Supplementary Order Papers through to the select committee to fix up this bill part-way through, and to explain to the committee whether he thinks those Supplementary Order Papers actually adequately address the issues which have been raised with him by the partnership schools. We sat on the select committee, and the schools were given limited time to respond to those Supplementary Order Papers. They were given very limited time to be able to actually have their say and speak to them, and the result, in what they said, was they weren’t happy. So I ask the Minister to actually explain how those provisions are actually going to address the issues which they have raised in the select committee process, because they had very limited time to be able to respond, and this is a significant issue. These are significant issues, because, as I have said, they address the future of our young people, the future of our children and our young people, and the opportunities that they have for their future.

So we have a number of Supplementary Order Papers that we’ll be progressing. There are also other issues that I’ll be focusing on in regards to the polytech and university councils and the numbers of representatives. Essentially, this bill is trying to weaken our institutions by ensuring that there are going to be elected members, and it’s going back to what we’ve had in the past. It’s going to weaken the governance by not requiring those people to actually have the governance skills that everyone else around the table is going to have, so we’re going to have some Supplementary Order Papers to address that, as well.

CHLÖE SWARBRICK (Green): E Te Māngai, tēnā koe. Tēnā koutou e Te Whare. It is my pleasure to rise and speak to, in particular, the Supplementary Order Papers in my name to this Education Amendment Bill. I just wanted to address the point made by the last speaker, Mr Simeon Brown, with regard to his proposition that we are going to see institutions weakened by way of restoring elected members to our tertiary education councils, and, also, actually, to refer to his point about how the unions want to have control—complete and utter control—of our education sector, to the claims of ideology, which, of course, the Opposition has none, in having removed elected members in 2015.

This Education Amendment Bill, obviously, in particular, does a broad range of things. But, in particular, I wanted to speak to the issue of representation on those tertiary councils. There were 481 submissions which commented on clause 12 and clause 14 of this bill around staff and student representation and the composition of those tertiary councils—451 submitters supported guaranteed places, and 449 submissions commented that there should be more than one of each. That is more than 90 percent of submitters on the issue of increasing staff and student representation who would like to see more than one of each.

On the point of those “evil” unions that the Opposition enjoys bashing so much, I want to point to the TEU’s petition—that is, of course, the Tertiary Education Union—that I received this morning, with 900 signatures from staff at tertiary education institutions calling for more than one staff or student representative on these tertiary education councils. Of course, these provisions were removed in 2015 by the Opposition, who was then the Government.

What we’ve seen, as highlighted, actually, in the open letter this morning, published by another union, NZUSA—the New Zealand Union of Students’ Association, which brought together 14 different student organisations around the country—was a call for that increase in student representation around tertiary councils. They noted, in particular, that what they were looking for from this legislation was genuine representation around those tertiary councils, not check-box tokenism. In particular, having more than one—indeed, a guaranteed two places around that council table would allow for the discussion of confidential information, allowing for robust conclusions, and supporting each other in fact in putting those conclusions forward to the council.

As has been noted by Opposition members, some of these elected members are not necessarily coming with a wide range or breadth of experience. The very reason that they are there is to represent views and perspectives of consumers of education—to use a piece of terminology so frequently bandied about. So that’s one of the Supplementary Order Papers that I’m putting forward—No. 104, which would increase student representation from “at least 1” to “at least 2”.

The second Supplementary Order Paper is No. 136. This one is slightly more technical in that it increases staff representation from at least one to at least two, but, of those two, at least one must be “a permanent member of the teaching staff of the institution” and the other must be “a permanent member of the general staff of the institution”. That is kind of technical or more granular in detail, thereby providing a guarantee of different perspectives, again, around that council table—so, too, what Supplementary Order Paper 136 does, which is to increase the size of those councils.

I presume, in response to that, we will hear the Opposition decry that this is a “waste of resources”. But, indeed, what we are doing here is ensuring and guaranteeing that the representation around the council table is a genuine representation of perspectives so critical to the sustainability and long-term thinking around this institutions—decisions that would’ve been made a whole lot better and more robust had these perspectives been around the table with decisions made over the past three years. Thank you, Madam Chair.

DENISE LEE (National—Maungakiekie): Thank you, Madam Chair, for the opportunity to speak here this evening, and I do so alongside my fellow colleagues on the Education and Workforce Committee on both sides of the House, and others who are joining us, for what promises to be really good debate, suggestions, and commentary on this particular bill and in the committee of the whole House stage.

I want to just get straight into it and refer to Supplementary Order Paper (SOP) 123 in my name. What it seeks to do is—“In clause 14(2), replace new section 222AD(5)” with a new subsection (5). That new subsection (5) would read: “An elected person specified in subsection (4) must have been deemed to satisfy responsible criteria to sit on the council, and have appropriate and relevant skill sets to contribute to the deliberations of the council.” So, obviously, this SOP refers to the make-up of councils, and it’s quite fitting that I follow the previous speaker, Chlöe Swarbrick, in regard to her commentary on the make-up of councils.

What this SOP is seeking to do is to recognise that the governing council of a polytechnic is actually quite a demanding and important role, and we’d all acknowledge that. But the suitability of an individual to contribute to those decisions and actions of a governing council needs to be a little bit more entrenched and set out in legislation. So what we’re suggesting here is that this particular SOP would ensure that the relevant knowledge, skills, and experience of those who sit on the council are high and entrenched.

Now, if you look in the current bill, what clause 14(2) is seeking to insert in the new section 222AD(5) is that “An elected person specified … (a) is to be treated as meeting any relevant knowledge, skills, or experience requirements;”. So there is an assumption there that this is seeking to step one step back and say, “Well, before we get there and make that assumption that they’ve got the relevant knowledge, skills, and experience, how can we get this piece of legislation to ensure that?” So if you step one step back, it’s about overall safeguards on suitability, or if we want to spin it a positive way, it’s about ensuring that we have positive criteria for those who sit on the council.

Now, I’ll refer to the previous speaker right before me, and her comments on membership of the councils. This is incredibly important, because if you look at, say, for instance, the Tertiary Education Union—and I’ve got a number of other submissions right here with me. Let me see who else submitted on this: Auckland University Students Association, Otago University Students’ Association, the Tertiary Education Union Tai Poutini Branch—so all of them, plus many, many others, are looking at increased membership. In fact, if you look at the Tertiary Education Union submission, they’re up to about 12 to 18 members. That’s a lot.

This is a question that I want to pose to the Minister: how can he assure us that this bill has appropriate mechanisms for ensuring responsible criteria in terms of governance suitability from what could be many council members, and knowing that the selection process can be very varied? Governance is everything, leadership is everything, and it’s entirely fitting and appropriate that if we’re heading down this track, we have appropriate mechanisms to ensure criteria. We need to get it right, and this is the chance to do so.

So I would like to see the Minister respond to this particular question around just switching out—it’s a proactive stance rather than a reactive clause that we see now in terms of eligibility and criteria. Thank you for the chance to start with this. As my former colleague said, we’ve got many SOPs to come.

SIMEON BROWN (National—Pakuranga): Thank you, Madam Chair, and thank you for the opportunity to, again, speak on the Education Amendment Bill. This Supplementary Order Paper I’d like to talk about is No. 127, which is a Supplementary Order Paper in my name that amends clause 15, which is in regards to the offence which is being created for those who take fees-free without reasonable excuse, and make a false representation for the purpose of receiving, or continuing to receive, free tertiary education from a tertiary education organisation. This clause in the bill is a direct response to the Government’s policy that they implemented at the beginning of this year, which was fees-free for the first year, and will eventually, under their proposal, if they wish, continue that to three years. And it does the right thing: it puts in place an offence for the amount of $5,000 for someone who commits the offence of making a false representation.

Now, we dispute the amount here. We do think it should be higher, and I’d like the Minister to explain to the committee why he believes that amount should remain that amount and not have it as a higher amount, because the amount which could be taken by a student who makes a false representation could be greater than $5,000 under this policy. But my Supplementary Order Paper seeks to remove the words “without reasonable excuse”, and the argument for doing so is that we do not think the court should have discretion to decide whether or not a person who has committed the offence of false representation has a reasonable excuse or not. Essentially, we believe this should be strict liability. If someone has made a false representation, then they are guilty of that and they should face the consequences, because this is public money, this is Government money, taxpayers’ money—and the hard-working people in my electorate in Pakuranga don’t want people to be able to just get free cash from the Government, making false representations and then being able to drag it through the court and try and come up with a reasonable excuse. That is completely unfair and slaps them in the face. What a waste of money that would be if we don’t change this.

So I ask the Minister in the chair to explain to the committee why, and what he thinks a reasonable excuse could be, and how he justifies the range of reasonable excuses that could be made up. Is it “because I forgot”? Is it “because my dog ate my lunch”? Is it “because I left it at home”? You know, there’s a whole range of excuses which could become—from the absurd to the more reasonable. But what does “reasonable” actually mean in the context of making a false representation? A false representation is something which is a very serious thing to do, and I guess the question here is, in making that false representation, where does the bar get made? I’d like the Minister to seriously address that issue in the backdrop of the fact that this is potentially incredibly costly to New Zealanders.

I think it’s important, also, for the committee and those listening to remember that when the Government actually set this scheme up in a huge rush, they didn’t even have the ability to actually check whether someone has enrolled previously and actually had tertiary education prior to now getting free education. And so I would ask the Minister to potentially take the opportunity to explain to the committee what the situation was when this policy was implemented, the actions they have taken since then, and whether the Minister is satisfied that there has been none or very little, in terms of taxpayers’ money, going to those people who shouldn’t be getting it under the policy that he has set up.

The fees-free eligibility criteria are easily outlined as part of the application process. When students go and enrol and they are trying to seek to have their education paid for under the fees-free process, the information is very clear on the website, and in our view there is significant information available for those students to know that they have an obligation to make a true declaration as to what their position has been. And that’s not a high expectation; that’s just asking those students to tell the truth. So what we’re proposing is saying, well, actually, it’s not a hard obligation, there is actually no real excuse for this, and what these students need to do is tell the truth, and, if not, pay the fine.

JO HAYES (National): Thank you, Madam Chair. This is my first contribution on the Education Amendment Bill, and I’m standing here. I want to support the kōrero on this side around kura hourua and partnership schools. I, for the life of me, cannot understand why any Government would want to get rid of a school programme and schools that are actually responding to the needs of Māori and Pasifika students that have failed within mainstream schooling. Why on earth would you want to do that, Madam Chair—not bringing you into the discussion, but I do not understand the thinking around the Minister’s ideology around what partnership schools are doing. I do not understand that. I have talked with the teachers there, I have spoken with the students—which I think is a little bit more than what the Minister has done with these schools—and the case that has actually gone for a Treaty claim, it stands with great merit.

So as I stand here and still wonder what on earth this bill is all about, at the end of the day, it seems to me that this particular bill, this Education Amendment Bill, is like the Government just wanting to stamp their mark on perfectly good legislation that this side of the House actually implemented and did the work on. Yes, we needed to review it, but really going at it, slashing it to pieces, isn’t really the way that a Government should be behaving. I’m really disappointed in the way that this Government has approached education per se. This particular amendment bill, to me, just flies in the face of what this country could actually produce through its education system.

So I stand, I’m disappointed, and I just want to make sure that the amendments in the Supplementary Order Papers that this side of the committee puts in are considered—are considered by the Minister. Without that consideration, making this bill a bill that everybody in this Parliament can be proud of will not actually wipe on this side of the Chamber.

My Supplementary Order Paper that I want to speak about is Supplementary Order Paper 126. It follows on from my colleague Denise Lee’s around the constitution of combined councils. It’s clause 14A, “Section 222AM amended (Constitution of combined councils)”. I don’t understand in this bill why the Minister must ensure that at least 50 percent but not more than 60 percent of members of the combined council are members appointed by the council. I think that this particular clause of the bill—I believe it’s actually very poorly crafted. It conflates the issue of appointments to combined councils. What it also does is it puts the council—should the council opt for between 50 percent and 60 percent, as soon as they go over that 50 percent mark we have an imbalance. We have an imbalance.

The Minister must ensure that combined councils are evenly balanced. That’s how organisations are run. There’s got to be an even balance on these councils. I believe that this particular clause 14A should actually be deleted from this bill. It’s not a good piece of legislation for this particular part. I think that the Minister would have too much say. I think that the Minister needs to stand up and answer why deleting clause 14A will be an issue for him. I don’t think it will be an issue. I think we must make sure that our combined councils, the polytechnics etc., the tertiary area will actually have their ability to be able to appoint evenly across their organisation for council members.

Obviously, he doesn’t really have faith. He wants to have some say in there, and I think that that’s very unfair. I think they’re very capable of being able to do this. I think it’s a waste of time. I would like to see this clause in the bill, clause 14A, deleted from this bill—not go back there. Give the kudos to the council, to the council members, to be able to do the right thing, to get the nice balance that they have always done in previous years. So I don’t know what the Minister thinks that he needs to actually figure out.

Hon TIM MACINDOE (National—Hamilton West): Thank you very much, Madam Chair. Kia orana to you. In the first and second readings of this bill I spoke predominantly about my great concern about some of the significant aspects of this bill, this Education Amendment Bill, such as the removal of national standards and also, effectively, the abolition of partnership schools. There is a huge amount in this bill, and as we go through the committee stage of the bill it is clear that this is fundamentally flawed legislation for which this Minister will be remembered, and history will judge him very poorly for it. I say this to the Minister: I have respect for him, but there are ideological decisions that are being reflected in just about every clause of this bill that are not what the public of New Zealand is asking for. They may well be what some of the union leaders have asked for, but they are certainly not what the people in my electorate and those in the electorates of my colleagues are hearing from our constituents.

Since we’re in the committee stage I want to commend some of my colleagues who are around me and behind me tonight for the very considered amendments they’ve put forward. And as other members have done, I want to ask the Minister, please, to take a call. It is good that he is here but he must respond to a number of the questions and the concerns that are being raised by him. If we look for a few moments at the fees-free regime, on one level that sounds very attractive. After all, who wouldn’t want to have the opportunity to enrol in a course of study that he or she might not be able to afford were it not for this policy? So on that level, it sounds attractive.

But, unfortunately, what this does is it creates an incentive for some people who are not really suited to a course of tertiary study to enrol, because, effectively, there is no consequence for making the wrong decision. I would have thought that it made more sense to create an incentive for commitment and achievement and application during the course of study. If you were going to introduce one year of fees-free, why not put it on the end of the course of study to say, “We recognise that over the course of study you’ve accumulated a student loan debt.”—and in some cases it’s quite significant.

Both of my children have substantial student loans. In fact, they are quite eye-watering, and I know that that’s true of many of their friends as well. Had they had an opportunity at the end of their course of study, after they had done well and passed all of their papers—not necessarily passed every paper but shown that they were really committed to the study—it would have sent a message about applying themselves. To have this policy applied at the final year—and it’s not just for university study; it’s also for trades courses and all sorts of things available through the polytechs—would have created at least the message that if you apply yourself and show that you are really making the most of your opportunity, we’ll reward you at that point. But, oh no—here we have something that sends an incentive at the beginning, which may be good for some but is certainly not good for all.

So I want to ask the Minister: how much fraud is he aware of in the tertiary education fees-free regime? Because I don’t think we’ve had an answer to that question, and yet New Zealanders would be very interested in hearing the answer, and they would expect the Minister to be able to tell them. So how much fraud is already apparent and has become known to the authorities in our tertiary education fees-free regime? Next comes the question to the Minister: how concerned is he personally about that issue? Is that sufficient for him to say, “Well, perhaps it’s time just to take a step back, to think again about whether we’re heading down the right path here.”, because I can assure him that there are many New Zealanders who do feel that this is something that should be looked at very carefully.

New Zealanders are forced to be very generous in supporting our tertiary students because of this particular policy. We were already very generous, because, on average, tertiary courses are subsidised to the effect of around about 75 percent. That was before this particular policy was introduced. While, again, that sounds pretty attractive, what we have to look at is the fact that the sons and daughters of people who are earning some of the highest incomes in this land are being subsidised by people on the minimum wage and benefits through the tax system, and there is something fundamentally wrong about that, I would have thought. Again, it’s a sort of one-size-fits-all approach to an issue where that is just inappropriate. So I would ask the Minister to comment on that as well. Why should the sons and daughters of people who are earning the figures of, say, a member of Parliament, a Cabinet Minister, a leading doctor, a specialist, a magistrate, a District Court judge—I’m showing my age in using that term. Why should people who are in a family of that sort receive the subsidy from the people in my electorate who are really struggling to make ends meet on the minimum wage? That is what is happening at the moment.

Now, one answer to that—and it’s an answer I accept—would be that this is a way of helping people to reach a level where they can support themselves and have a better life for themselves and for their families. That’s great—no argument with that. I don’t think anybody in this Chamber would argue with that, but the way in which it is being achieved is fundamentally flawed. And I hope that the Minister will explain why he thinks that is fair to the people who are doing it tough in our country at the moment.

Could I turn to commending two of the Supplementary Order Papers that, I think, in this area are particularly meritorious, because as we look at the fact that the wrong signals are being sent, another wrong signal is surely being sent about there being no consequences for fraud. Simeon Brown, the member for Pakuranga, has introduced Supplementary Order Paper 127, a very good Supplementary Order Paper. We spoke about it earlier, and I want to commend his comments and add my support to it, because what he is saying is: why should there be, in a particular clause, the phrase “without reasonable excuse” in respect of making a fraudulent declaration? Mr Brown’s amendment removes that phrase, as it’s a very serious offence. It’s not just an offence against legislation; it’s an offence against the taxpayers of this country. It is an offence against those people who, as I’ve mentioned, are doing it tough in our communities and earning the minimum wage. If we say there won’t even be a sanction for committing that sort of behaviour, then the law is, frankly, an ass, and I hope that Mr Brown’s Supplementary Order Paper therefore will achieve the support of members across the Chamber.

Let me also add my support to Supplementary Order Paper 132 in the name of Jo Hayes, which would see, in clause 15(2), the insertion, after new section 292A(4), of this provision: “ (4A) A person who commits an offence against subsection (3) will, on conviction, become ineligible to receive a loan interest write-off under section 137 of the Student Loan Scheme Act 2011 for the balance of their student loan.” Well, I would be fascinated to hear if any member opposite is going to argue against that very sensible amendment.

I am concerned that we are not hearing from members opposite. We have, at least, heard from the Green Party member, but we are not hearing from Labour members opposite, and I would like them to stand up and explain—if they’re not going to support Jo Hayes’ very sensible Supplementary Order Paper, why not? I say to those members opposite that they owe the public of New Zealand a very clear explanation, because why on earth should somebody who has defrauded the taxpayer, who has willingly and wilfully supplied totally inaccurate information, not face some sort of consequence? Nobody else, in any other area of life, would be able to get away with that sort of behaviour. Fraud is fraud. A false declaration if given wilfully and knowingly is a very serious offence, so I call on the Labour members opposite either to explain why they wouldn’t support that Supplementary Order Paper or just to get up and do it—give it their support.

So I look forward to taking calls later in this committee stage on some other aspects of the bill, but in this call I wanted to focus on those aspects related to our tertiary fees-free and loans policies, because they are serious. They haven’t had a lot of attention prior to now because there have been some very big issues that have dominated the first and second readings, but in the committee stage, members on this side of the Chamber are very concerned to get these finer points of the legislation right. There are ways that this bill could be improved. I hope that the Minister and his colleagues are listening. I look forward to their support for the Supplementary Order Papers that my colleagues are putting forward.

Hon CHRIS HIPKINS (Minister of Education): Thank you, Madam Chair. It is a good time to respond to a few of the issues that have been raised by members of the Opposition thus far. I’ll work backwards through those, perhaps, and start with the contribution from Tim Macindoe.

The first part of his contribution, or the first half of his speech, largely was an ideological argument against fees-free, which doesn’t actually relate to the bill, which, of course, is a very narrow and technical aspect of the implementation of the administration of fees-free. Now, I accept that the Opposition are ideologically opposed to fees-free, and we can have that argument on another day, but with regard to the specific provisions in the bill which are around the making of a declaration, the intention of these provisions is to make it easier for someone to make a declaration.

I utterly reject the claim that the member made, which is that there is no consequence for fraud. In fact, the bill creates a consequence for fraud. That is one of the purposes of the bill, and that’s exactly what it does when it creates an offence and a fine that goes with committing that offence. He did ask me how much fraud I’m aware of. None is the answer to that. I’ve not been informed of any fraud associated with the fees-free policy. This is about making compliance with the requirements of that easier. We do have systems in place to detect when people are making false declarations or false applications.

Just to pick up a couple of the other points that have been made—Simeon Brown, I think, continues to make the claim that charter schools are being closed. They are not being closed; they are transitioning into the public education system. The Supplementary Order Paper, Supplementary Order Paper 50, that deals with transition measures responds to issues that were raised by those existing charter schools in the transition process. Now, not all of them agree with one another on these, and there was certainly some disagreement about that, but, actually, the intention of the bill is to remove the ideology of privatisation and deregulation from the school system that was introduced.

Now, I think Simeon Brown and Tim Macindoe both didn’t get the memo from Nikki Kaye about the teachers when they talked about our union mates, because it seems to me that the union mates—of course, these are teachers that they are talking about. On the one hand, the National Party is trying to cuddle up to them at the moment, so I am surprised that their ongoing attacks on teachers are continuing, in light of that. It does seem to be somewhat contradictory. The allegation is that we are giving teachers too much power over what happens in classrooms. Now, I think that we could give teachers a bit more power over what happens in classrooms, and that would probably have quite a positive effect on kids’ education, because, actually, these are people who have devoted their lives to educating kids, and they do actually know what they are talking about, as opposed to some of the contributions that we’ve had in the debate so far.

The final point that I wanted to respond to was Parmjeet Parmar’s question: without national standards, how will parents know how their kids are doing? Well, the requirement for national standards has been replaced with a requirement for schools to report to parents regularly and in plain English about the progress their children are making in all aspects of the curriculum. So it’s not just about literacy and numeracy. Actually, parents want to know how kids are doing across the board, and not just in literacy and numeracy, and there is a multiple range of tools that schools can use in order to give parents very accurate information—much more accurate information than they got through national standards, which research reports clearly demonstrated were neither national nor standard. So they were getting bogus information previously, and now they will actually get reliable information.

Now, just with regard to the various Supplementary Order Papers, I did do the Opposition the courtesy of reading them all and considering them all, which is something that the committee is not particularly accustomed to, because certainly for the nine years that I sat in Opposition, having tabled many Supplementary Order Papers myself, I don’t think Ministers in the previous Government ever troubled themselves to read them. But I read them and I considered them. Now, none of the Supplementary Order Papers put forward by the Opposition enhance the bill. Most of them express opposition to the bill, which is an understandable thing, and therefore seek to delete various parts of the bill, but, actually, they don’t improve the bill in any way. Many of them are inconsistent with the policy intention of the bill—i.e., trying to delete clauses in order to thwart the policy intention of the bill. But none of them—and I have considered them—in my view, enhance the bill, and therefore, certainly, the Government intends to vote against them.

NICOLA WILLIS (National): I rise to speak on the Education Amendment Bill in this committee stage. I want to acknowledge the Minister of Education for addressing us in this committee, and I suggest that it would have been nice if he also took the time to address the students in the partnership schools, who very much have the view, Mr Hipkins, that their schools are being closed.

The Minister can stand up in Parliament and say that those schools aren’t being closed, but I have sat down with the students of Vanguard Military School and I have sat down with Nick Hyde, the leader of that school, and his very clear view is that the school that he established to transform the lives of young people at that school has been irrevocably changed by this Government. It will no longer remain in its current form, and the magic that allowed it to do great things for dozens of young people may well have been destroyed completely by the flexibility that is being taken away by this legislation and by the legislation that preceded it. So let us be very clear today about what is happening.

Now, I want in this contribution to first talk about the bit of the mishmash of amendments that we have in this bill. Of course, what happened for the Education and Workforce Committee, of which I am a member, was that we had one amendment bill come that we received submissions on in good faith and that we considered, and then we had the Supplementary Order Papers (SOPs) land. The SOPs, in fact, established this entire section relating to how partnership schools should treat their employees as they move to becoming designated character schools. Did the partnership schools who would be affected by those clauses have the opportunity to present to the committee and show their views on what impact they would have? No, they didn’t, and that is relevant.

I want to thank and call out and acknowledge Mark Patterson from New Zealand First, who joined National members of the committee—

Hon Tracey Martin: No, not quite right.

NICOLA WILLIS: —in writing to the Business Committee. That’s exactly what happened, Tracey Martin. He signed a letter to the Business Committee outlining our shared frustration in the report-back date and the timetable for this bill, which meant that caucuses weren’t able to properly consider it and which led to a shortened process. I want to thank Mark Patterson, because it was a simple matter of what’s right and wrong in terms of parliamentary process, and we weren’t given ample time to consider this bill.

I would warn the Minister today that if there are unforeseen consequences with some of the amendments here relating to the way staff are treated, then be it on his head, because there wasn’t ample consideration of them. They were last-minute amendments and there are still real questions to be asked about them.

The second point I want to raise is about this whole issue of what this transition to designated character schools means for partnership schools, because we have this delightful suggestion that, actually, they will remain just as they were. I want to draw your attention to the amendment in clause 9A to section 156AA, which allows that a designated character school may “name a body that has a special affiliation with the school or has responsibility for the different character of the school:”. So partnership schools have had taken away their ability to have a governing body of the composition they choose running the school, leading the school, and deciding who teaches in the school, what hours it runs, and how funding is used, and, instead, what they’re allowed is that a body is allowed to be named that, actually, just has a special relationship. Somehow, the Minister thinks that that sop will be enough to maintain partnership schools in their form, and I think that it is beneath him to make such a claim for such a small and meaningless amendment.

We also, of course, in this bill have the question of national standards. Of course, the point that the Minister neglected to mention was that there is now no requirement for system-wide reporting on how children are achieving in schools. So while an individual child might get some progress about goodness knows what benchmark—it will depend on which school you’re at and which principal is in charge and what teacher is teaching as to what sort of information is conveyed—there is now a very real question that Treasury officials have raised with the Minister and that other officials have raised about how we, as a country, will track system-wide progress of students from one school to another. The Minister still, in this bill, hasn’t come up with amendments to replace that, and that is very disappointing.

In further contributions, I’m going to discuss a number of SOPs that I have brought to the House that I believe would improve this flawed bill, but before I do so, I do want to draw attention also to this question of fines for students who make a false statutory declaration in order to gain access to fees-free tertiary education. If there was ever an indication that the fees-free policy was rushed in in an ill-thought-through manner, it is this clause that seems to latterly realise that people might actually be prepared to take quite significant steps in order to get free tertiary education, that, in fact, free tertiary education could be worth thousands of thousands of dollars, and that the Minister might have an obligation to protect taxpayers from abuse of that.

It is disappointing that here we are, many months into the application of the fees-free policy, and only now is there going to be punishment for people with false statutory declarations. As previous members have raised, there is a real question about whether or not a $5,000 fine is sufficient. I want to draw your attention, for example, to the fact that someone going to aviation school might expect to spend up to $18,000 in fees in order to get their pilot’s licence. Well, weigh that up against a $5,000 fee and you might find that the incentives for people to make false statutory declarations remain, despite this amendment. But, most importantly, I’m interested in where this amendment came from, because we never had it addressed at select committee why this hadn’t been raised in earlier legislation and why it hadn’t come up earlier.

So my specific question to the Minister is: does he have any concerns right now that there are students who have made false statutory declarations in order to get fees-free tertiary education? If the answer to that question is yes, then New Zealand taxpayers deserve to know, because that is a gross abuse of public money. It is not something that should be countenanced, and it is something that we should have public knowledge of.

Of course, the Minister could have taken the opportunity in this bill to make other amendments to the fees-free policy. I make a regular practice of engaging with students in Wellington. Last night, in fact, I attended a pot-luck dinner with a number of students at Victoria University of Wellington, and the subject of fees-free tertiary education—as it does—came up. What these students said to me was “We just can’t understand why you would get it in first year, when everyone knows that’s the year when half of the people drop out. Really, if the Government wanted to help people out, why wouldn’t they be helping out the people who make it to the very end, who study hard and pass their courses? Why wouldn’t the Government help the people out who are actually from the homes that didn’t have the financial or material support? Why wouldn’t the Government help out the students who attend schools and have had teaching and circumstances that mean they don’t even have the grades to attend university?” Those questions were asked by the students. I looked them in the eyes and I said, “Those are good questions. You need to put them to the Minister.”

But, instead of debating those sorts of issues in the House today, we are debating the Education Amendment Bill, and it is, in summary, a bill that seeks to remove good progress in terms of the national standards sections and the partnership schools sections. It then puts in the requirements around statutory declarations for fees-free tertiary education, and then, of course, there are the issues relating to council composition.

I want to draw the committee’s attention to the fact that at the select committee we had wānanga submit to us, saying that they felt that the provisions around council composition were inappropriate for them, particularly because they didn’t want to have to have requirements around staff and student representatives because it was very important that they had iwi representation and tikanga-competent people. Those views were heard, and there have been subsequent amendments to the bill.

But what wasn’t responded to in a similar fashion were the concerns from Māori leaders, who came forward and said, “We have grave concerns that there are sections of this bill that represent a Treaty of Waitangi breach.” A question for the Minister today I have is: what consideration has he given to the potential that this bill re-entrenches a Treaty of Waitangi breach? What consideration has he given, or what advice has he received, about the potential Treaty of Waitangi implications of this piece of legislation? If he has had that advice, we in this House deserve to know, and members opposite deserve to know before they put their votes to it.

Finally, before I sit down—but I will rise again to speak on my SOPs—I want to just say to Chlöe Swarbrick, if you’re prepared to listen to 900 people submitting from the Tertiary Education Union, what about the more than 1,000 students at the partnership schools, who have spoken very clearly—[Time expired]

SIMEON BROWN (National—Pakuranga): Thank you, Mr Chair, for the opportunity to take another call on this legislation. I just want to commend the challenge that Nicola Willis put to Chlöe Swarbrick to explain to the committee how she is prepared to listen to the 900 or so people who signed a petition through the Tertiary Education Union, and not the over 1,000 students and young people who are studying at our partnership schools and their families and the lives which they are changing and impacting. So I think that challenge also should be put to the Minister, Chris Hipkins, today, as well.

I’d like to take a moment to speak in support of my Supplementary Order Paper 122, which amends clause 9 of the bill. I know the Minister has sort of tried to explain, with a broad brush, that he doesn’t agree with a range of these Supplementary Order Papers, but he didn’t actually go into any detail. He simply just said, “Oh, look, I don’t agree with these and I’ll just go throw them in the bin.” So that’s essentially what he’s done.

So what this Supplementary Order Paper seeks to do is, essentially, protect the intent of what he’s tried to say that he’s doing for our partnership schools. He said, “We’re not closing them down. We’re letting them continue.” But what this actually tries to do is put some action to the words that he’s tried to use in explaining this to the public, which, I can tell the Minister, the public aren’t buying.

But, anyway, let’s get to this Supplementary Order Paper. So there are three things. The first thing it does is that it ensures that “The establishment board of trustees for a new State school”—which these schools will be transitioned to; closed down and then restarted as—“will be made up of the board of the corresponding and closing partnership school”. Now, the reason for that is to ensure that the intent and the purpose and the people who make up that partnership school—the purpose of it; who are the driving force behind what that partnership school is all about—are able to continue, and will be the same people as at the closing partnership school. They will be exactly the same people.

That ensures that there is that continuity which is required and which will allow those schools to actually transition, rather than close down and start as something new. What the Minister’s trying to do is he’s trying to say, “Well, we’re just going through this transitionary process.” Well, he’s actually closing these schools down and restarting them under a different model with a different board of trustees, with a different structure, with different rules, and a whole range of different things. So this, essentially, means this provides for a smoother transition for those schools.

The second is: “In the event a designated character school is established to replace a closing partnership school … the construct of an alternative constitution would retain the option of appointing no Ministry of Education nominee to the designated character school’s governance”. And this is to ensure that that partnership school, which will then be transitioned, or closed down and opened again, would remain and retain its independence and allow it to be able to continue to pursue the purpose that it has.

Now, I ask the Minister to explain why he feels the need to interfere with the purpose and the direction of these schools. The results that they’ve had speak for themselves. The lives they’ve changed speak for themselves. The ethos that these people bring, the way that they engage with these young people and engage with students who would otherwise be disengaged and would become statistics later in life—these are the type of students that these schools are re-engaging and are getting into our education system and turning their lives around. So I challenge him: why does he need to mess with their structure if they’re doing such a great job already?

The third part of this Supplementary Order Paper 122 is around “State schools established in the place of partnership schools [would] retain the ability to employ staff on individual employment agreements outside of any teachers’ collective agreement.” That’s what they can do now. Why can’t the Minister allow these schools to be able to employ teachers on the conditions that they are on? We heard the big rally cries by the Government where they said there are going to be teachers in these schools who aren’t registered. This is not talking about unregistered teachers; this is talking about teachers, and is simply allowing them to be employed under an individual employment agreement outside of the teachers’ collective agreement. There’s no problem with that. Or is it simply because the unions are trying to ask for more power? We on this side say the unions don’t need that power. This can be done differently.

Hon NIKKI KAYE (National—Auckland Central): Look, I’m very pleased to speak on this bill, but, firstly, can I just, though, take a moment to acknowledge all of those children and the families of those children who have been at partnership schools, which are some of the most successful schools in New Zealand, that have been terminated by the Minister of Education. He is driving through a piece of legislation that will remove a model of which the facts are very simple.

Firstly, iwi leaders are opposed to this. This Government has talked a lot about how much they care about Māori education. People like Sir Toby Curtis, people like Dame Tariana Turia, and people like Dame Iritana Tāwhiwhirangi—all of them have opposed this, especially when there is a Waitangi Tribunal claim currently being processed. This Government is moving, ignoring iwi leaders, ignoring the families, and ignoring these children, and pushing through this legislation and ignoring the Waitangi Tribunal.

The other thing that I would like to say is on those videos from those children. The facts are, again, that the Prime Minister and the Minister of Education, post the election, have not bothered once—not bothered once—to go and visit these partnership schools, and they have been terminated, and now this legislation is going through which removes the model. Many of those children have had really tough backgrounds. Many of the sponsors have worked for many years in education, doing an incredible job. So it is a very sad day for New Zealand. That is why the National Party will bring back partnership schools. We will expand the model. We will provide opportunities for children with incredibly complex needs, and that’s why we oppose this legislation in terms of partnership schools.

The second part of this legislation that we oppose is, ultimately, around accountability of achievement. We all believe in this House that, actually, what every parent wants to know is the progress of their child. But what we also understand—or most of us on this side of the House understand—is that, in order to be able to be confident of a nationwide picture of achievement, it is important to have information reported back to the centre, to the Ministry of Education, so that we can actually target some of our most vulnerable children who are in schools and so that we know where there are major numeracy and literacy issues. What the Government did—again, it’s part of their ideological agenda; it’s part of what they do in terms of bad process—was, late last year, instead of consulting with the million parents out there about what they think in terms of reporting and school reports, they scrapped national standards, and now what this bill is doing is making sure that any reference to national standards is gone from law.

The question that I have for the Minister is why didn’t the Minister consider consulting with the million parents before he amended the guidelines last year? Why is it now that we have a situation where legislation is going through and he isn’t confident that we’re going to have individual reporting back to the centre, to the Ministry of Education? How is it that he is confident that we will not be the laughing stock of the world in terms of not having a nationwide picture of achievement at an individual school level? Why is he confident of that? Why did he do it at the end of last year—again, without that consultation of parents? That is, again, why the National Party opposes this bill.

We want to work cross-party. We believe in a system of progression. I was the Minister, actually, that put that decision through. But instead of working across the House, instead of accepting that we don’t want to have a ping-pong between National and Labour in education, and instead of working cross-party, this Minister not only got rid of partnership schools by terminating the contracts but also pushed this legislation through despite huge opposition from parents and families and many iwi leaders but also has now removed every reference to national standards and hasn’t put something to replace it with in terms of basic accountability of our education system.

So I would like the Minister to stand up and talk to this House about why he doesn’t believe that there should be that basic accountability around our education system and information that comes to the centre, to the Ministry of Education, so that we know where we need to put additional resource for some of our most vulnerable children. And I ask the Minister to do that, again, on the back of the fact that some of our most vulnerable children in New Zealand, who have been at partnership schools, are missing out as a result of this law.

Hon CHRIS HIPKINS (Minister of Education): Nikki Kaye claims that the removal of national standards would make us the laughing stock of the world. I think what the world potentially is laughing at is the fact that subsequent to introducing national standards, the achievement of New Zealand children declined in international studies, because they clearly didn’t work. They weren’t national, and they weren’t standard.

Nikki Kaye then claims that we didn’t consult about the removal of national standards. I can give her an absolute guarantee that there was a lot more consultation about the removal of national standards than there was about the introduction of them, because they were introduced under urgency without any select committee process at all. We at least had the decency to put it through a full six-month select committee process in order to remove those national standards.

Basically, Nicola Willis and Nikki Kaye both repeated many messages that we’ve already heard repeatedly through this debate, which, effectively, trash the schools that are going to be replacing charter schools. I think they should take care, because if they do care about the children who attend those, then trashing the reputation of the schools that will open at the beginning of next year and saying that they are not going to be the same and they’re not going to be able to deliver quality education for the kids in the way they have been in the past isn’t going to be in the best interests of those kids and of those schools. So I’d encourage them to think again about that particular approach.

With regard to Nicola Willis’ claim that the Supplementary Order Paper was not given to the select committee in time for there to be adequate consideration, that’s simply not true. What the committee chooses to do with that, and the fact that they chose whether or not to hear submissions, is a matter for the committee.

With regard to the claim both Nicola Willis and Nikki Kaye made that removing national standards will mean no system-wide monitoring, again, that’s a complete fiction. There was system-wide monitoring for national standards, and there’ll be system-wide monitoring after national standards. In fact, it will be genuinely reliable and it will be robust, unlike national standards, which study after study showed was neither national nor standard. So trying to say that there was a comparison between school A and school B using national standards was nonsense, because we know that the subjective judgments that school A and B were using in order to assess national standards were often different, and so the same child would be assessed differently by different schools. National standards were a fiction. They didn’t live up to the label on the tin, and that is one of the reasons why we removed those.

Finally, the other point—which, again, I’ve already made several times—is that there has been no evidence of fraud with regard to the implementation of fees-free. Most of the arguments being raised by the opposition are about the fees-free policy itself. That is not what this bill deals with; it deals, quite narrowly, with the offence provision for fraud. There is no evidence of fraud; this is a precautionary measure. The measure is here, first of all, to make it easier to comply with the fees-free requirements for a declaration and, second of all, to introduce an offence if there was any evidence of fraud—and as I’ve indicated, there hasn’t been. So it’s about simply safeguarding the public’s interest.

Hon NIKKI KAYE (National—Auckland Central): I just want to make a couple of points in response to the Minister of Education’s comments. The first point is I would like the Minister to consider releasing to the people of New Zealand the time line that he gave us around that Supplementary Order Paper (SOP) that went into the select committee. The reality is our committee ended up scrapping with other Labour members to be able to even let the partnership schools know that this SOP had been put into the committee. So that’s the first point. It was completely rushed, it was something that was going to affect the lives of staff members, and it was going to affect the way that these schools ran. The process was absolutely appalling, and I challenge the Minister to release that time line so that New Zealanders can actually see exactly what that process was.

The second thing is I completely object to the characterisation that the Minister has raised that somehow on this side of the Chamber we are trashing the designated character schools. We are not doing that. We are pointing out that under the model that there was in terms of partnership schools, it was a model that was successful. It was successful. We know that because there was an independent evaluation by Martin Jenkins—there were several reports—and it not only showed there were great things happening in terms of children with complex needs; it showed a lift in achievement with many of these children. It showed incredibly good things in terms of both student achievement and staff morale.

So our point is we can stand in this House and say that model was working and that model was successful, and, on the other hand, we can say we are very hopeful for the designated character schools but acknowledge exactly what many of these schools have said in the select committee which is that they won’t have the flexibility of funding, they won’t have the flexibility of teaching resources, and they won’t have the flexibility of management. We are absolutely capable of distinguishing between what was a great model and then what is a model that is going to be very different for these schools. So I absolutely object to the member characterising that somehow we are trashing the designated character schools, because we are not doing that.

The third point that I want to raise is around this issue of nationwide achievement. Again, the question I have for the Minister is that—it is correct that he put through a change to the guidelines around national standards last year. He did not consult with a million parents on that. He did that last year before this legislation came through the House. That is an absolute fact. It is an absolute fact.

The second point that I want to make is that he has not clearly articulated, and that’s why he’s got an advisory group—one of the many, I think there are 15 now—that is looking at how they might have additional reporting. He has not put a system of replacement in there. Again, we have said we were quite happy to move to a system of progression. I know this because I put a Cabinet paper through that said, “Let’s move from national standards to a system of progression.” But do you know what we acknowledged? We acknowledged several things. Firstly, in order to be able to support schools and not have chaos—I’ve received the many emails from principals and teachers around New Zealand, some of which think they’ll still keep national standards, some of which don’t know exactly what their system will be in the future but they know that parents want national standards—you need to transition a system through.

So the smart thing to do would have been to do what that Cabinet paper said last year, which is to invest the tens of millions of dollars in ensuring that the progress and consistency tool was up to scratch, to invest in other curriculum resources, and to agree with the National Party, or other people in Parliament, on what a decent system of reporting would be. That would have been the intelligent way to go about this, but also the thing that would have meant that many other teachers and parents out there could have had confidence in some kind of cross-party agreement around parental reporting. Instead, what the Minister did was he scrapped national standards via the advisory guideline last year and this legislation is cleaning that up, and it’s been a sham of a select committee process when he knows that that decision was made last year.

So I did want to address those three issues: that issue of the fact that National are very supportive of what designated character schools are doing, but we do believe the partnership school model was very successful; secondly, we absolutely stand by our position that is there needs to be accountability around parental reporting and the data and the nationwide picture of achievement; and thirdly, we totally object to the process that that Minister created around the select committee and the SOP, because it affects a whole lot of schools.

Hon RUTH DYSON (Senior Whip—Labour): I move, That the question be now put.

Hon TIM MACINDOE (National—Hamilton West): Kia ora, Mr Chair, and thank you very much. I am outraged that the senior Government whip would be taking a closure motion at this point in a debate on such a significant topic.

CHAIRPERSON (Adrian Rurawhe): Order! Members have the right to do that. It is the sole decision of the Chair—

Hon TIM MACINDOE: Mr—

CHAIRPERSON (Adrian Rurawhe): No, the member will turn his attention to the bill, to Part 1.

Hon TIM MACINDOE: Mr Chair, I just want to assure you that in no way was I questioning your decision; I was simply pointing out that I’m outraged that the senior whip was trying to do that, because this is a very important measure. This is going to affect the lives of some of our vulnerable young people. This is going to have a major impact on the education system in this country, and the very least that the Government should do is engage in this debate. I do acknowledge that the Minister has taken a couple of calls, and I appreciate that. He didn’t answer all of the questions that were put to him, but he certainly did respond to some of the matters that have been raised. I also thank the Green member Chlöe Swarbrick, who has taken a call.

What else have we heard from members opposite other than that one closure motion? Absolutely nothing. There are teachers over on that side of the Chamber. The Associate Minister of Education Tracey Martin has been here for much of the night. She’s been chirping away. We’ve heard lots of interjections; most of them have been difficult to decipher, but we certainly know it’s been her making the noise. So I want to ask the Associate Minister: since she is so keen to interject, why won’t she take a call? It’s not as if she has no interest in this matter; she is an Associate Minister of Education. Surely she should be able to defend this legislation.

CHAIRPERSON (Adrian Rurawhe): And the debate is not about her participating in the debate; it’s about Part 1 of the Education Amendment Bill and the member should turn his attention to it.

Hon TIM MACINDOE: Mr Chair, I do want to ask the Associate Minister of Education what she would say to the parents, to the whānau, to the tamariki who are currently enrolled in partnership schools. That is very much part of this section of the debate. When they can point to such significant evidence of their success, why does the Associate Minister claim that she knows best in telling them that the model that they have developed and proven to be successful is not in the best interests of those children? All of the evidence suggests to the contrary.

That Associate Minister’s party recently voted to entrench the Māori seats. Now, how does the Associate Minister of Education reconcile that clear contradiction of New Zealand First’s long-held, clearly articulated policy to the contrary—

Hon Tracey Martin: Why are you talking about me?

Hon TIM MACINDOE: —and how will she now tell her supporters—is the Associate Minister denying that her party recently voted to entrench the Māori seats? That’s exactly what that party did with Rino Tirikatene’s bill.

CHAIRPERSON (Adrian Rurawhe): And the member, again, needs to come to this bill not the other bill.

Hon TIM MACINDOE: I’m trying to point out the total inconsistency in the Associate Minister’s position on issues that are relevant to this bill. She is now ignoring the clear evidence of widespread support for partnership schools especially in the regional communities of New Zealand that her party has spent at least the last year telling us that they are championing.

Hon Tracey Martin: That’s rubbish.

Hon TIM MACINDOE: Well, talk is cheap; the action speaks volumes to the contrary. When did the Associate Minister of Education decide to take her instruction from the unions on education matters, because that certainly wasn’t the approach that her party signalled in their education election policies last year? I listened to New Zealand First candidates in my area giving very different ideas. Suddenly, however, she is happy to let the lead Minister of Education completely dominate all the decision-making. She has capitulated on matters that should be important to her party. She should be prepared to differentiate herself from the Labour Party on this matter, because these are things that matter in the lives of young people.

Partnership schools have made an enormous contribution in their short time of existence—for the better—for tamariki the length and breadth of this country. I’m incredibly proud of that; I’m incredibly supportive of that. I’m supportive of it first and foremost because those were young people who had fallen through the cracks, who were already on the path to very grim futures, and those partnership schools have picked them up, turned them around, given them a sense—[Time expired]

Dr PARMJEET PARMAR (National): Thank you, Mr Chair, for this opportunity. I would like to start by responding to the call the Minister of Education took earlier. So, yes, we are grateful that the Minister is taking calls. The Minister actually said that he has gone through all the Supplementary Order Papers (SOPs) put forward by us, which is really good. But, with due respect to the Minister, I want to say to the Minister that he might have read them but he hasn’t understood them, because, firstly, he said that about reporting—yes, there is another way of reporting put in place, which will be done twice a year or something like that. But what we mean is something that is sensible, something that means knowing the place where the child is in the big picture. So if the report is going to read that, yep, your child can read but can also improve, what does that mean? Can the child read or can the child not read? That is what a parent wants to know. Just getting a paper twice a year or thrice a year is not helpful.

Hon Tracey Martin: At what level? At what age? What reading age?

Dr PARMJEET PARMAR: We need to be able to measure their learning against something, and that is what national standards did. The member, if she wants to take a call, she should actually stand up and take a call. So, yes, take your time and make your point in your time.

So, coming back to my point, what parents want to know is how their child is doing in comparison to the whole system. They don’t want to receive a piece of paper that they have to sit there and interpret and understand where their child is in the whole education system. Because that means a lot—reading, writing, and maths mean a lot for a child’s future.

Hon Tracey Martin: Science? Arts?

Dr PARMJEET PARMAR: Yeah, for arts. For any kind of trade, there has to be some reading skills, there has to be some writing skills, there has to be some kind of maths skills. I don’t think anyone can be a successful tradesperson without knowing how to read, how to write, or having some basic maths skills. If that is what this Government wants to promote, we are definitely not supporting that. Of course we want to see that national standards are kept.

The second point I want to make is the Minister said that our SOPs are saying that there are no consequences. We are not saying that there are no consequences if someone is misrepresenting—that is clause 15. We have two SOPs and members on this side have already spoken to those SOPs—SOP 128 and SOP 127. SOP 128 is Denise Lee’s SOP and SOP 127 is Simeon Brown’s SOP. Today, the Minister said there are consequences. We know that the consequences are there in the legislation, but what we are saying is that the consequences are not enough. That’s not going to actually help people, people that would feel tempted to take this opportunity to misrepresent and take advantage of something that is freely available. That’s what we are saying. We are saying that the offence that is in clause 15(4), “a fine not exceeding $5,000.”, is not enough.

The other SOP, which was about removing “without reasonable excuse”. Why we are saying to remove “without reasonable excuse” is that if there is this clause the way it is, that is, keeping the wording “without reasonable excuse” in the clause, that means the person is misrepresenting willingly, knowingly. If that person is willingly and knowingly misrepresenting, then there should be severe consequences. The consequences that are listed here in clause 15 are not going to deter anyone from taking advantage of this free system that is available, at the cost of $2.8 billion of taxpayers’ money. So this is taxpayers’ money; it cannot be taken lightly. There can be temptations by people. If the Minister wishes to keep “without reasonable excuse”, then the Minister should take a call to explain why he thinks that, when that person is convicted, a fine of up to $5,000 is going to be enough.

In other legislation we have seen there are fines of up to $55,000, and this is along with the possibility of imprisonment. So this is a serious fraud, if somebody is misrepresenting and taking advantage of the education system at the cost of taxpayers’ money. If that person actually goes through with it, the benefit for that person will be huge. If that person is caught, if it is going to be just up to $5,000—it could be $50, it could $100, it could be $1,000—that will mean nothing. So the Minister needs to put a system in place where people know that if they try to take advantage of the system that is freely available, then there are going to be some serious consequences.

So no one is saying that there are no consequences listed in this legislation; what we are saying is that the consequences listed in this legislation are not enough, and we want to make sure that people are not committing fraudulent activity and we want to make sure that the consequences are serious enough so that they realise—[Time expired]

Hon TRACEY MARTIN (NZ First): I move, That the question be now put.

Hon JACQUI DEAN (National—Waitaki): Oh, thank you, Mr Chair, because I’m very keen to make a contribution to this debate. I want to speak to the Supplementary Order Paper (SOP) 109, in the name of Erica Stanford. It makes quite a significant change to clause 18. When I go to the bill and have a look at clause 18 and look at inserted clause 12A of new Part 6 of schedule 1 of the principal Act, it says “Transitional arrangements for employees of specified partnership schools …”—the SOP inserts a new clause 12AB.

I do congratulate Erica Stanford for this clause, because it’s a very well-thought-out humanitarian type of clause which is for the benefit of the children of partnership schools as they transition into designated partnership schools, which in itself is a travesty. That is something that’s been well canvassed by members standing up in this committee tonight and at the Education and Workforce Committee, as flawed as that process was, thanks very much to this Government not allowing people to have their say on something which is so very important to our children in New Zealand. But Erica Stanford has stood up for those children, as have a number of other colleagues on this side of the Chamber.

So if I have a look at this new clause 12AB—“Transitional arrangements for funding of specified partnership school …: The funding arrangements that existed under the terms of the contract of a specified partnership school … that is, or is to be, replaced by a specified State school must be carried over to that specified State school for up to 5 years.” Well, how sensible is this SOP? Because what it means is, for those children who are already in those partnership schools, they will have the certainty and the security of knowing—well, they won’t know, hopefully, because they shouldn’t have to bother themselves with details like this, but we do and we should and we are. They will have the comfort and security, and certainly their parents and supporters and caregivers will, that the funding is in place for the next five years, so that if the 13-year-old child is in one of these schools which is transitioning, then they will know that until they leave the school at the age of 18 or earlier, that level of funding that is there to support them in their learning will be there for them for the time of their school learning.

One would hope that in the time of that five years, upon the passage of this SOP, there will be a change of Government and we will take a different approach to those children in our education system who need that extra support which has been provided by partnership schools.

So I want to commend the member for this SOP. It is a humanitarian approach, which I have to say is sadly lacking on behalf of this Government, on behalf of this Minister—Chris Hipkins—who has been deaf, dumb, and blind to the impacts and the implications that will be brought about by the passage of this Education Amendment Bill. This Minister has been concerned not so much with the welfare of these children but, instead, has been absolutely concerned by the look—by the look—of partnership schools. How dare there be partnership schools in New Zealand’s education system, which are providing an outstanding support to those children who need their care. How dare they, in the eyes of this Government—

Hon Tracey Martin: Whangaruru.

Hon JACQUI DEAN: —and the eyes of this Minister and this Associate Minister, who’s had a lot to say but most of it has been unintelligible this evening—how dare they?

So I want to congratulate this SOP in the name of Erica Stanford, and there are others on the Table. There are other SOPs that myself and other members who care about children, who care about children’s education, are very keen to pick up and speak to. But in this debate on Part 1 of the Education Amendment Bill, just simply inserting, in clause 18, new clause 12AB, transitional arrangements providing security of funding for the next five years surely must give rise to a sigh of relief from the teachers, from the parents, from the supporters, and from the caregivers of those children in New Zealand in those partnership schools which are being forced to transition through to specified partnership schools; this must be giving them hope that on one side of the House there are people who care about the children.

Hon Dr NICK SMITH (National—Nelson): As a former Minister of Education, I want to particularly focus in on clause 9 in Part 1 and question the Minister of Education on the ideology behind getting rid of the charter schools and replacing them with this notion of special designated character schools. My concern is that the election and the rhetoric from the Government since has been dominated by this notion that New Zealand needs to do better with our disadvantaged young people and to provide them with more opportunities in education. There’s absolutely no question from this side of the House on that objective, but the part that I find extraordinary, and that’s been so well highlighted by my colleague Nikki Kaye, is that the very schools that are making such a material difference to the lives of our most disadvantaged children are those charter schools, and yet for purely ideological reasons—and let’s not be cute about it. Who’s funded the Labour Party has resulted in them wanting to change—

Hon Tracey Martin: Oh, hey!

Hon Dr NICK SMITH: Well, the member from New Zealand First interjects. Tell me I’m not correct that the teacher unions are the paymaster for the Minister in the chair and that as a pay-off, want to get—

Hon Chris Hipkins: I raise a point of order, Mr Chairperson. Those allegations by the member speaking—the longest-serving member in the House—are completely out of order and unacceptable. I take offence to them and, of all the people in the committee, I didn’t think the National Party would be talking about where money comes from today. [Interruption]

CHAIRPERSON (Adrian Rurawhe): Order! I’m on my feet.

Chris Bishop: That’s outrageous.

CHAIRPERSON (Adrian Rurawhe): I’m on my feet—OK? Let’s not get too excited over what’s happening in the Chamber right now. I would say to the Hon Dr Nick Smith, though, that I think he has crossed that line and that he should withdraw that comment.

Hon Dr NICK SMITH: I withdraw, but I challenge the Minister: can he please give me a logical explanation as to why we would want to advance legislation that nails charter schools that even his own parliamentary colleagues accept are making a material difference in the lives of those New Zealand children that are doing the very best and which need to improve. You see, I heard Willie Jackson prior to the election championing the cause of charter schools, I heard Kelvin Davis championing the cause, and I genuinely believed that they were here to advance the cause, particularly of young Māori, and what we were seeing in these charter schools making such a massive difference in children’s lives.

Here’s the other part: why is it that the Prime Minister has refused to visit any of the charter schools when she says that she cares so much about our kids? I was Minister of Education, and I was repeatedly challenged by members opposite at every single school, and I did close some schools for non-performance and some that didn’t have sufficient roll to be justified. I visited every single one of them. Why is it that the Prime Minister, who’s wanted to wear her heart on her sleeve around the issue of our disadvantaged children, has not been prepared to visit the very schools that are being changed by provisions in Part 1 of this bill and is compromising the education of those children who we on this side of the House want to give opportunity to and want to break the cycle of disadvantage?

I make no apologies for saying that the reason the Government is doing this has nothing to do with the welfare of children. It has nothing to do with “Education” in the title of this bill. It has nothing to do with trying to address some of the social challenges that our country has. It has everything to do with the association of the current Government and their close relationship with the teacher unions, who only see a single model of education, even where that fails kids. That’s why members on this side of the House take such strong objection to the provisions in this bill that actually are bad for children and actually are going to make it more difficult for New Zealand to find the solutions, to find the innovation, and to do the work that’s going to make the difference for those children’s education that this Parliament owes more than anyone for.

So I just want to hear from the Minister in the chair: give me a good reason. If it’s not because of the close association with the teacher unions, give me one good reason why we should be getting rid of these schools and imposing these extra constraints on them when the record is quite clear that they are giving a better result for our children.

Hon RUTH DYSON (Senior Whip—Labour): I move, That the question be now put.

CHRIS BISHOP (National—Hutt South): Thank you very much, Mr Chair. You know, the funny thing about partnership schools around the world is that they are not the preserve of centre-right parties like the National Party—typically not the preserve; they are actually institutions advanced by progressive parties—or, at least, parties that like to call themselves progressive. I have not taken a call yet in this Education Amendment Bill debate, in either the first reading or the second reading, and I just want to put it on the record that partnership schools in New Zealand will go down as progressive institutions of achievement. It doesn’t matter what the Labour Party says about them and it doesn’t matter the defamation that Tracey Martin can fling about—

Hon Tracey Martin: Ha, ha, ha, ha!

CHRIS BISHOP: —and it doesn’t matter the insulting things that Tracey Martin—

Hon Tracey Martin: That member should know about misleading statements. If anybody knows, that member knows.

CHRIS BISHOP: Well, that member laughs, but it is a matter of record that Tracey Martin stood in this House and compared charter schools to what people send their dogs to—what people send their animals to. It is a matter of record that Tracey Martin likened partnership schools to dog kennels. I just want to put that on the record. [Interruption] My colleagues are saying, “We were there.”, and she’s gone all quiet again because she knows that that—

Hon Tracey Martin: That member’s not misleading the House again, is he?

CHRIS BISHOP: —deeply defamatory and insulting remark—

CHAIRPERSON (Adrian Rurawhe): Order!

Hon Tracey Martin: That member’s not misleading the House?

CHAIRPERSON (Adrian Rurawhe): Order! The Hon Tracey Martin will withdraw that comment. It is wrong to accuse someone of misleading the House.

Hon Tracey Martin: Hmm, hang on. I’ll think about it.

CHAIRPERSON (Adrian Rurawhe): Ah—

Hon Tracey Martin: I withdraw and apologise.

CHAIRPERSON (Adrian Rurawhe): No, you do not make a comment to the Chair like that. You stand, you withdraw and apologise, and that’s it.

Hon Tracey Martin: I withdraw and apologise.

CHRIS BISHOP: Thank you very much, Mr Chair. It is a matter of record that the associate education Minister did that. It is a matter of record that she defamed and insulted these partnership schools and the teachers and the students who go there. My colleagues and I, unlike Ministers and members opposite, have actually gone and visited these partnership schools. Anyone just needs to take a look at the speeches given by Nicola Willis and Erica Stanford and our spokesperson for education, Nikki Kaye, to realise how passionate they are on behalf of the students and teachers and principals of these great schools.

These are not institutions advanced by centre-right parties. The biggest advocate for partnership schools—or “charter schools”, as they call them in the United States—is not Donald Trump and it’s not the Republican Party; it was President Barack Obama. It was President Barack Obama who started his State of the Union speech in 2012 by promising a massive expansion of partnership schools around the United States. Why? For exactly the same reasons they were introduced by the National Party and the ACT Party in New Zealand: because traditional schools don’t meet the needs of all students, because there’s a cohort of students for whom traditional schooling has failed; there’s a cohort of children for whom the innovation and flexibility provided by partnership schools, which have the ability to wrap themselves around individual students and tailor their educational offering to those particular needs that they have—they know that that works. Barack Obama promised the expansion of partnership schools, or charter schools, throughout the United States for exactly the same reasons that we did, and it is, frankly, reprehensible that we are standing in the House tonight debating in committee stage a bill that will get rid of schools that do so much good.

It just is worth reflecting on that: we have a small number of schools, set up with the best of intentions, doing a good job for students who so desperately need them. It’s just worth reflecting on that. These are not students who don’t need assistance, like the students who get the fees-free. These are students whom the Labour Party purports to represent. These are the poor, the downtrodden, and the indigent; the students who have struggled the most at school, from the hardest backgrounds, from the least well-off families in our country. Go to South Auckland Middle School and look at the students who go there, and don’t tell me that they don’t need assistance. These are the pupils the Labour Party say they represent, and they’ve come down here and rammed a bill through that does away with the very institution that is trying to allow these kids to escape their backgrounds.

Denise Lee: How does that add up?

CHRIS BISHOP: “How does that add up?” says Denise Lee. I don’t know how members opposite look themselves in the mirror in the morning.

Hon NIKKI KAYE (National—Auckland Central): Look, I want to pick up on Chris Bishop’s speech, and I want to just remind us for a moment of some of the moments that we had in the Education and Workforce Committee: Sir Toby Curtis turning to the committee and saying, “Could the Prime Minister show some aroha?” I do want to address the Prime Minister this evening. I want to address her because she made comments to our previous Leader of the Opposition, Bill English, to the effect that there could be a pathway for these partnership schools if they followed the curriculum, if they had comparable funding, and if they had registered teachers. Here is the reality: these schools were following the curriculum. Many schools in New Zealand don’t have registered teachers; they have limited authority to teach. These schools had comparable funding. But the reality is not only did the Prime Minister not follow up on that commitment but also she never turned up. She morally failed these children. That is the truth here. She did not visit the schools, she did not keep that commitment publicly, and that is not only it.

I look at the Ministry of Education’s regulatory impact statement, and I object to it. It says that the Labour Party campaigned on getting rid of partnership schools. That is not true. Where were Kelvin Davis and Willie Jackson, who both publicly, prior to the election, said that they believed in partnership schools? In fact, Kelvin Davis said that he would resign. This regulatory impact statement by the Ministry of Education is false. It’s wrong. The reality is that not only has the Prime Minister failed these children but also a number of these processes around getting rid of partnership schools have been completely wrong, incorrect, and legally improper, and I want to talk you through them.

The Minister of Education put the Crown potentially at legal risk by announcing that they would all be gone anyway before he had terminated the contracts—process error number one. The second thing is that, for months on end, these schools did not know what their future was and they were left in a situation of limbo. The next question that I have for the Minister of Education is: not only has this been a moral failure; it has been a fiscal failure, and I want the Minister to front up. I want him to front up on the exact compensation cost for these schools, and also the running costs, because I tell you what I’m hearing: I’m hearing that, actually, there were a number of agreements made by the Minister and the Ministry of Education that are not being upheld. So not only have these schools been terminated but also there’s been some deals behind the scenes that are not being honoured.

I hope that there is a journalist listening. I hope that there are some journalists that will try and uncover that and ask the question: is it the case that not only have these schools been terminated but we’ve got legislation being rushed through when there’s a Waitangi Tribunal claim being opposed by a number of iwi leaders, and also that it might be that the Crown is not living up to its deal in terms of some of the things that it offered these schools to become designated character?

I would argue that not only is it a moral failure but it is a fiscal failure. Is it $10 million? Is it $20 million? Is it $30 million? What is the cost of the ideological drive of this Government to shut down schools that are helping some of our most vulnerable children? Well, we want to know, and we don’t want this legislation to go through. We want the Minister of Education to stand up now in this House and tell us what is the cost of that, particularly at a time when we’ve got the Prime Minister and the Minister of Education saying to the teachers that there’s no more money—there’s no more money. But there’s billions of dollars of surplus and there’s been a whole lot of money for diplomats, but there’s no more money for teachers. So why can’t the Minister of Education then confirm exactly how much it has cost the Crown, the Government, the people of New Zealand to close these schools? How much has it cost? We want to know that. It’s a moral failure, it’s a fiscal failure, and it’s a legal failure.

I want to deal with this Waitangi Tribunal claim. I do have Supplementary Order Papers that try to deal with this, and I would love the Minister to tell this committee why it is that he needs to push this legislation through this week. Why can’t he meet with Sir Toby Curtis? Why can’t he meet with Dame Iritana Tāwhiwhirangi? Why can’t he meet with Lance O’Sullivan? Why can’t he meet with these people? Why can’t he meet with the claimants that have put in a number of iwi leaders to discuss the issues at hand? Why does the legislation need to go through now? Why won’t he do that? I have put amendments which, effectively, say, “How about we give the respect to these iwi leaders and let that process happen?” That is the right thing to do. Forget the moral and the fiscal failure that has already happened. Why are we pushing this legislation through at a time where you have this Waitangi Tribunal claim?

Finally, I just want to finish on national standards. Again, as I’ve said before, ultimately, there are a few policies that would affect parents so much, but something that involves reporting about their child’s achievement, you would think that there would be huge consultation on that. Well, I have just again gone back to the regulatory impact statement, and it’s really clear. It says national standards were, effectively, scrapped on 13 December of last year by this Minister, and, again, in that regulatory impact statement it says there was no systematic stakeholder consultation. So again I make this point to the Minister: not only is there a moral and fiscal failure around partnership schools but he has morally failed parents on national standards.

Hon PEENI HENARE (Minister for the Community and Voluntary Sector): I move, That the question be now put.

CHAIRPERSON (Adrian Rurawhe): I am going to take another call, but I am going to let members of the committee of the whole House know that we’ve had several contributions and the contributions around partnership schools have been well traversed, and I haven’t heard any new arguments from members. Members might want to turn their attention to other parts of Part 1 or come up with new arguments.

DENISE LEE (National—Maungakiekie): Thank you, Mr Chair. I appreciate the chance to take this call. It is just my second call tonight. I spoke on my first Supplementary Order Paper (SOP), and I intend to speak now on my second SOP, and it is not on the subject of partnership schools. But I would want to start, if you’ll indulge me, Mr Chair, by using just a quick Niuean greeting, because it is Niue Language Week, and that’s Fakatonu Fono Taane, which hopefully says, “Mr Speaker”. Ha, ha!

One of the drawbacks, of course, of the committee of the whole House stage is that you’re up on your feet and you hope that you can talk following someone else so that there is a theme, and a definitive and very undergirded theme, but that doesn’t always happen. It’s been a good passage of time since my colleague Simeon Brown spoke on his SOP 127, and I’m going to just make a couple of remarks on that before I head into my SOP 128. Now, of course, they are on the topic of the penalties, I guess, and the newly inserted and created penalties for those who would wish to do something untoward in regard to fees-free tertiary criteria and if they choose to—and they shouldn’t, but if they choose to—commit an offence of a false representation.

The SOP in Simeon Brown’s name which seeks to amend clause 15 would ask to remove the phrase “, without reasonable excuse,” from the new section 292A(3). So we don’t think that the court should have discretion to decide whether or not a person who has committed the offence of false representation has a reasonable excuse or not. That’s just stating something very obvious. But it is very obvious, because there is no reasonable excuse for committing an offence. There never has been and there never should be. The fees-free eligibility criteria are clearly outlined as part of the application process, so where is the excuse in not knowing what is clearly outlined?

If you go and look on the Government’s fees-free website, it is there in plain English and black and white for everyone to see. You should never be in doubt whether you are sure or unsure about meeting eligibility criteria; it’s there in plain language for all to see. Now, if that be the case—switching now to my SOP 128—in clause 15(2), I’d like to suggest that we replace subsection (4) of new section 292A with the following words: “A person who commits an offence against subsection (3) is liable on conviction to a fine of the higher of—(a) $5,000;”—and that’s, of course, what we see in the current wording—“or (b) the amount of money gained from false representation.”

Now, this is an interesting point. Perhaps $5,000 is actually not enough. In this case, perhaps committing an offence and receiving a fine of $5,000 is nowhere near the sum total of what someone gained from false representation monetarily. If that’s the case, then why are we not sending an incredibly strong signal? And if the Labour-led Government saw fit to put in a new offence in the first place, why not make that a very strong and very clear signal that it’s not just one capped figure but there is scope to send a bigger monetary consequence?

I note that the Minister of Education said earlier on, when he was speaking and addressing the House, that none of our SOPs improve the bill in any way. Really? This does exactly that. If we want to ward off and if the Government wants to ward off anyone falsely declaring, well, then here’s a really practical way to do that, and I hope they pick this up.

CHRIS PENK (National—Helensville): Thank you, Mr Chair. It’s a pleasure to be able to speak to the Education Amendment Bill, specifically Part 1, obviously, as we are engaged in this committee stage. I will speak very narrowly, if I may, on clause 11 of the bill, which relates to section 159 of the Education Act. It’s to do with interpretation. I did promise you it’s going to be pretty narrow—it’s narrower than a you-know-what’s you-know-what. Specifically, it’s only one definition at that, and it’s the phrase “permanent member”. The significance of that, which I’ll return to in a minute, goes to the appointment of a person, or, rather, the consideration of the appointment process by the Minister, in terms of making an appointment to the council.

But to the interpretation itself—to that particular definition, which will flow to a question that I’d be very grateful if the Minister would address, as he’s shown willingness to do throughout the debate, for which I thank him in anticipation—the definition of “permanent member” in this bill relates to “teaching or general staff of an institution,”. And I presume that the intent of the drafting there was to capture that it could be any staff member whatsoever. So I just note in passing that perhaps it could have been expressed to be “any staff member”, as I understand that the phrase “general staff” probably means any staff other than teaching staff, and we’ve already got teaching staff, thereby including the whole lot. But, in any case—moving on.

So an institution’s staff of any kind, then, and a member thereof who fits one of three different categories—the first is pretty clear: on a basis that is neither casual nor a fixed-term contract. I think and hope that I’m right in saying that’s pretty clear. Obviously, I’m happy to stand corrected if the Minister has a different view, but we’re talking about full-time or part-time basis and a period ending either on resignation or retirement—neither of which event is ordinarily known or, indeed, specified in terms of a calendar date. So that much is clear in terms of the first criterion.

The other two options relate to employment: either, again, full-time or part-time and whether under an employment agreement. That could be, in fact, a fixed term in this case, but here we see that it must be for at least three months. So if we’ve got a fixed-term contract, then, in addition to that first criterion, it must be at least three months that that particular member, in order to be considered a permanent member, must have already been, by the relevant time, employed. Now, lest there should be any doubt about the possibility of someone being selected by the Minister in circumstances where they’ve been employed for less than three months, well, then we’ve got a third criterion there.

I’d just like to pause at this point and just ask the Minister to reflect on the significance of three months. I don’t know if that was a particular time frame, based perhaps on ensuring that they would have served at least one school term in the institution and therefore have at least some sort of appreciation for something of the life cycle of a period of time within the school, or perhaps not. Perhaps the word “term” there is something of a red herring and I’m reading too much into that. In any case, there is scope for the consideration of a person who’s been in for less than three months in the circumstances, however, where, for the chief executive of the institution—and I haven’t checked to see whether that aspect is defined, but, in any case, it’s probably clear enough whether a person holds that role or not—it occurs to them that it’s likely to continue for at least three months from the date of commencement of the operation. So all bases seem to be covered; although, as I say, I’m quite curious on that point about the significance of the three-month mark.

The context of this—as I alluded to earlier on and, as promised, have returned to now—is that under section 222AD, as it will be, amended, in clause 14, the Minister must seek and consider nominations from the relevant council, and then, when appointing members of the council, at least one member is a “permanent member”—that, of course, being the point that we’re defining in that other clause, again, of the teaching or general staff and so on. Similarly, at subclause (2) there, one member is a permanent member of the teaching staff, and so forth.

So that’s the significance of that particular definition. I think the clarity would be helpful just to ensure that we understand that that is the most appropriate time period. I’d welcome any advice that the Minister can give us in that regard, and I hope that I’ve gone some way to help clarifying that quite narrow aspect of the legislation, whether it shall pass or not.

Hon PEENI HENARE (Minister for the Community and Voluntary Sector): I move, That the question be now put.

NICOLA WILLIS (National): Thank you, Mr Chair. I’m glad that I have this opportunity to speak, as I have a number of Supplementary Order Papers (SOPs) in my name which I haven’t yet had a chance in this debate to address, and which I hope to address in this speech. But before I do so, I do want to respond to comments that have been made by the Hon Tracey Martin this evening, who said that my comments relating to the support by her good party member Mark Patterson, in relation to the process followed by the select committee on this matter, were not accurate. So I do want to draw her attention to the amendment bill commentary and report from the Education and Workforce Committee, which is on the Table of the committee, and which quotes a motion that was agreed to by the committee: that the committee would write to the Business Committee outlining frustration with the report-back date for this bill, in particular the reduced time frame for parliamentary counsel to draft the revision-tracked version of the bill and the inability to take the report to caucus. I want to note, for the member, that Mark Patterson did agree to that letter being written, and that refers directly to the process issues that we had with this bill.

I also want to quickly take the opportunity to respond to comments from the Minister in the chair, Chris Hipkins, who said that I was trashing the future of these partnership school students, and I take particular issue with that, because I absolutely back the students who are in partnership schools. I back them to succeed. I want them to do very well indeed. I hope that their schools continue to do a good job for them into the future, but I am concerned that the Minister, by his actions, is removing the ability of those schools to act in the way that they have in the past. And I would put to him a couple of questions: will he commit that the performance of those schools will remain on par with where it has been—is that a commitment that he is prepared to make? And what responsibility will he take if the performance of these schools does reduce following the changes that this bill makes to the scope with which those schools can deliver for their students? I put to the Minister that, in fact, if there is anyone who is putting risk in these children’s way, it is he who is putting the risk of changing the structure of the schools they attend for reasons which are still to be outlined in the debate in this committee tonight.

Finally, I want to just address this issue of system-wide reporting, because we have the Minister asserting in relation to national standards clauses, “Oh, system-wide reporting will continue to occur.” This is the classic case of having your cake and eating it too. Say you want to get rid of national standards on the one hand, to placate one group of people, and on the other hand tell parents “Don’t worry, the system-wide reporting will continue.” So my question for the Minister is: what will be the common benchmark that schools will be reporting against in future if not national standards? What will that common benchmark be and in what form will they be required to make system-wide reports? In what form will they be required to provide information about the achievement of their students over time? And with what regularity and against what benchmarks? If the Minister won’t address those questions, we will judge his silence accordingly.

So I have two SOPs. The first SOP relates to clause 18, which of course is the new section that was introduced by a late SOP introduced by the Minister, which relates to the way in which designated character schools are required to take on the staff of partnership schools. It’s worth noting that every principle of a New Zealand school right now has the discretion and ability to recruit and employ their own staff as they see fit, because it is acknowledged that that right to hire teachers that are appropriate for the class and the students, that are appropriate for the school and its community, is a key way in which a school goes about its business. But, of course, the clauses in this bill that we’re debating tonight take away that power from this particular class of schools and dictate that they must take on the staff of previous partnership schools. So what this SOP does is it inserts a new paragraph that allows the principal or the board, if they consider the employee to be wholly unsuitable for appointment due to the character of the school, not to make that hire. We see this, on this side of the Chamber, as an appropriate safeguard that gives discretion to ensure that, where people are hired for teaching roles, they are appropriate for those roles. That’s SOP 106.

SOP 129 deals with this question of fines for students making false statutory declarations in order to gain access to the fees-free policy. What we’ve put in numerous speeches is the fact that, actually, if you are able to get free fees, which could be many, many thousands of dollars, a requirement that—[Time expired]

Hon NIKKI KAYE (National—Auckland Central): Look, it’s really good to have the opportunity to run through a number of Supplementary Order Papers (SOPs), which I actually haven’t even had the opportunity to speak about yet. So I’ve got a lot to say on a lot of SOPs, as do many of my colleagues who haven’t had the opportunity to talk to a number of those SOPs.

I want to start with a series of SOPs, of which one or two of them have been mentioned but, again, not gone into in detail, and it does cut to the heart of this fees-free issue. We know it’s $2.8 billion, we know that all of the figures show there’s not going to be great participation or major increases in participation, and that’s equivalent to paying—just so all New Zealanders can understand the scale of the funding that we’re dealing with, because it cuts to the heart of SOP 127, 128, 129, and 130, which I’m going to run through. If you’re going to give $2.8 billion of funding, which is equivalent to paying, potentially, 50,000 teachers a 15 percent pay rise, then you would want to make sure that this system was watertight in terms of accountability.

There are a number of SOPs here that I want to walk through. As I say, you look at SOP 127, put up by my colleague Simeon Brown, and this is all about deleting the words “without reasonable excuse,”. We actually believe that if you have, effectively, made a false representation, there isn’t a reasonable excuse. You have made a false representation. We are not going to accept a reasonable excuse if you have been in the act of doing something inappropriate in an area of fees-free. We’re talking about huge amounts of money, potentially, for students, so I would ask the Minister to consider SOP 127 very seriously.

You look at SOP 128, again, by my colleague Denise Lee, and her point is very simple. Again, I do want to quote the Minister back, because we would love to hear from him on this issue. He himself has admitted that it’s a very difficult situation to try and design proper scrutiny of a fees-free system, and so he’s gone and tried to develop this penalty, through which we can see multiple holes. One of the issues that Denise raises is that we should, as a principle, not enable or let someone benefit from that false representation. So, again, SOP 128 does cover that: that a person is liable for $5,000, but also, potentially, the amount of money gained from that false representation. I think the Minister should adequately consider SOP 128.

The other SOP that I want to mention is actually in my name, and that is, again, SOP 130, for which the argument goes like this: if you are a student that is about to benefit from $8,000 to $9,000—and we do have, again, many holes in this policy. There are potentially 50,000 people that may be filling out these statutory declarations, and I do want to hear from the Minister: can he confirm that there haven’t been any situations that he is aware of whereby there have been major issues around the statutory declarations? We may be hearing—

Hon Chris Hipkins: Yes. Yes, I can confirm that. I already have.

Hon NIKKI KAYE: Yeah, but we would like to know the scale of that. We would love him to talk to us about that in the House.

Hon Chris Hipkins: I answered that earlier.

Hon NIKKI KAYE: Well, we would like him to give us more detail, because we have serious SOPs on the Table. The one in my name, again, is SOP 130, which I would love for him to talk to. Can he confirm why he wouldn’t consider a penalty of $10,000, given that many of the fees that we’re talking about would be over $5,000 anyway? Why won’t he consider that as a possible option? That’s what my SOP does: it states that “A person who commits an offence against subsection (3) is liable on conviction to a fine not exceeding $10,000.”

Again, this is not about us bashing students. Actually, we know how many students work incredibly hard out there, but what we’re saying is that if you are putting up $2.8 billion, then you would think that you would have much stronger policies in terms of accountability. We have put up some options in this committee in the form of SOP 127, 128, 129, and 130, and we would like to hear from the Minister on the range of issues that I have raised.

Debate interrupted.

Sitting suspended from 9.55 p.m. to 9 a.m. (Wednesday)

TUESDAY, 16 OCTOBER 2018

(continued on Wednesday, 17 October 2018)

Bills

Education Amendment Bill

In Committee

Debate resumed.

Part 1 Amendments to principal Act (continued)

CHAIRPERSON (Adrian Rurawhe): Fakalofa lahi atu. Good morning, members. The House is in committee for further consideration of the Education Amendment Bill. When we suspended last night, we were considering Part 1. The Hon Nikki Kaye had the call, and she has eight seconds remaining if she so wishes.

Hon NIKKI KAYE (National—Auckland Central): Look, I wanted to just make the point that I really do want to hear from the Minister regarding Supplementary Order Papers (SOPs) 127, 128, 129, and 130. This side of the committee has a lot of SOPs that we haven’t spoken to, so we’ve got some really good speeches coming, which I’m sure we’ll have the opportunity to—[Time expired]

Hon CHRIS HIPKINS (Minister of Education): I will keep this reasonably brief. There are two things to respond to: one is all the additional typescript amendments that were tabled at 9.25 last night. I did go through those after the committee rose last night to check through them. They are, largely, what I would describe as filibuster amendments. I’m well familiar with those; I’ve done plenty of them myself—things like replacing “5 years” with “3 years”, replacing the word “may” with “shall”, replacing the word “must” with “may”, all basically amendments designed to ensure the committee spends its time voting on amendments rather than debating the content of the bill. And so the Government will be opposing all of those.

Nikki Kaye, in her contribution just late last night, did raise issues around false declarations, and I think she raised some substantive issues, which I’d like to respond to. In the debate last night, I indicated that I was not aware of any fraudulent activity, which was absolutely true at the time. I thought I’d better go and check to see whether there has been any and was informed last night that there are a couple of cases that are being investigated. If you put that into context, we’re talking about 50,000 or 60,000 - odd applications. If you considered it in proportion to, say, welfare applications or ACC applications or so on, there is nothing in there that suggests that there is a significant problem, and they are actually being detected. I’ve asked for more details of that, so if the member does want to put down some written questions, for example, I’m happy to supply the information to that. I haven’t had the information myself yet, but I will be getting it.

The question she asked was “Why not a $10,000 fine?” Why settle it at that $5,000?” And I think the point to make clear is that the $5,000 fine was recommended—because I asked this myself, actually, and I was initially inclined to go with a higher fine—by the Ministry of Justice as being consistent with fines of comparable offences in other parts of the law. And an important point to respond to, which the member raised around “What if the fees were more than the fine?”, is that they still have to pay the fees back. So the fine is in addition to the fact that they would have to repay whatever they had obtained through the fraudulent activity. So the fine is comparable to fines for comparable offences, and that answers that point. So I hope that addresses the issues that have been raised thus far.

Hon RUTH DYSON (Senior Whip—Labour): I move, That the question be now put.

A party vote was called for on the question, That the question be now put.

Ayes 63

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

Noes 55

New Zealand National 55.

Motion agreed to.

The question was put that the amendments set out on Supplementary Order Paper 121 in the name of the Hon Nikki Kaye to Part 1 be agreed to.

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

Ayes 56

New Zealand National 55; ACT New Zealand 1.

Noes 63

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

Amendments not agreed to.

Hon NIKKI KAYE (National—Auckland Central): I raise a point of order, Mr Chairperson. I’m really reluctant to do this, because I can’t actually think of a time in my political career when I have stood up and been on the edge of questioning a ruling, but I am looking at the scale of the Supplementary Order Papers (SOPs) that have been tabled, and there are a number of members who have individual SOPs who haven’t even had the opportunity to talk to them. I would just, potentially, like, firstly, to put this on record for all of New Zealand that is watching: that this side of the House has spent hours drafting legislative amendments—literally hours—many of which are in individual people’s names here. You’ve got members of the Education and Workforce Committee, you’ve got other National MPs, and we have not had the opportunity, from my perspective but also from my colleagues’ perspective, to adequately outline them to the committee. So I just want to put that on record. I don’t know whether the Chair wants to make any comments about that?

David Seymour: Speaking to the point of order?

CHAIRPERSON (Adrian Rurawhe): No.

David Seymour: I raise a point of order, Mr Chairperson.

CHAIRPERSON (Adrian Rurawhe): No, I’m going to make a ruling now, and I’m on my feet. The member will be seated.

David Seymour: Are you now saying that we—

CHAIRPERSON (Adrian Rurawhe): No, sit down. I am ruling on a point of order.

David Seymour: This is outrageous.

CHAIRPERSON (Adrian Rurawhe): I am ruling—

David Seymour: You don’t even know what the point of order is.

CHAIRPERSON (Adrian Rurawhe): Mr Seymour?

David Seymour: Yes?

CHAIRPERSON (Adrian Rurawhe): You need to be seated.

David Seymour: Do you know what the point of order is?

CHAIRPERSON (Adrian Rurawhe): I am ruling on a point of order—

David Seymour: That’s completely outrageous. I mean, you actually do have to take—

CHAIRPERSON (Adrian Rurawhe): No, what is outrageous is when the presiding officer asks a member of this House to be seated while he is making a ruling on a point of order—to try to stop that. That will lead to disorder, and the member will be seated.

David Seymour: Well, the presiding officer would have more authority—

CHAIRPERSON (Adrian Rurawhe): I have got two sanctions available to me: one is to send the member out of the Chamber; the other is to name the member. I will use one of them if the member is not seated within the next five seconds. I will use at least one of them.

David Seymour: Well, if there’s no debate, then there’s no point.

CHAIRPERSON (Adrian Rurawhe): The member will leave the Chamber now, thank you.

David Seymour withdrew from the Chamber.

CHAIRPERSON (Adrian Rurawhe): My comment is that the honourable member Nikki Kaye has put her view on record. That is now on record. The point of order is actually out of order. I have made that ruling. For the member’s benefit and for members of the whole committee, we have had at least 33 calls on this part of the bill. I would say that I believe I have been very generous in allocating calls. I will also put on record as well that I gave several warnings last night. I did not accept five of the six closure motions; I could have, and I have this morning, OK? And that’s the end of that matter. I will not be entertaining any other interjections or points of order that could lead to disorder.

Barbara Kuriger’s tabled amendment to Supplementary Order Paper 122, amending new clause 9(6), is out of order as not being in the form of legislation.

The question was put that the following amendment in the name of Barbara Kuriger to the proposed amendment set out on Supplementary Order Paper 122 in the name of Simeon Brown to clause 9 be agreed to:

in new section 146(7), remove “would retain” and insert “may retain”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Barbara Kuriger to the proposed amendment set out on Supplementary Order Paper 122 in the name of Simeon Brown to clause 9 be agreed to:

in new section 146(8), after “collective agreement”, insert “despite any clauses in that agreement to the contrary”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Barbara Kuriger to the proposed amendment set out on Supplementary Order Paper 122 in the name of Simeon Brown to clause 9 be agreed to:

in new section 146(8), after “kura hourua”, insert “may, if they choose,”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Barbara Kuriger to the proposed amendment set out on Supplementary Order Paper 122 in the name of Simeon Brown to clause 9 be agreed to:

in new section 146(7), replace “In the event” with “Where”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of the Hon Nicky Wagner to the proposed amendment set out on Supplementary Order Paper 122 in the name of Simeon Brown to clause 9 be agreed to:

in new section 146(8), replace “State schools” with “Any state school which is”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 122 in the name of Simeon Brown to clause 9 be agreed to.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 137 in the name of David Seymour to insert new clause 10A be agreed to.

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

Ayes 56

New Zealand National 55; ACT New Zealand 1.

Noes 63

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

Amendment not agreed to.

The question was put that the amendments set out on Supplementary Order Paper 136 in the name of Chlöe Swarbrick to Part 1 be agreed to.

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

Ayes 8

Green Party 8.

Noes 110

New Zealand National 55; New Zealand Labour 46; New Zealand First 9.

Amendments not agreed to.

The question was put that the amendments set out on Supplementary Order Paper 104 in the name of Chlöe Swarbrick to Part 1 be agreed to.

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

Ayes 9

Green Party 8; ACT New Zealand 1.

Noes 110

New Zealand National 55; New Zealand Labour 46; New Zealand First 9.

Amendments not agreed to.

The question was put that the following amendment in the name of the Hon Nicky Wagner to the proposed amendment set out on Supplementary Order Paper 124 in the name of Nicola Willis to clause 14 be agreed to:

in new section 222AD(4)(a), replace “is” with “may be”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of the Hon Nicky Wagner to the proposed amendment set out on Supplementary Order Paper 124 in the name of Nicola Willis to clause 14 be agreed to:

in new section 222AD(4)(a)(i), delete “permanent”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Matt King to the proposed amendment set out on Supplementary Order Paper 124 in the name of Nicola Willis to clause 14 be agreed to:

in new section 222AD(4)(a)(i), after “elected”, insert “by majority in a secret ballot”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 124 in the name of Nicola Willis to clause 14 be agreed to.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment not agreed to.

The question was put that the following amendment in the name of the Hon Nicky Wagner to the proposed amendment set out on Supplementary Order Paper 123 in the name of Denise Lee to clause 14 be agreed to:

in new section 222AD(5), delete “have been deemed”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of the Hon Nicky Wagner to the proposed amendment set out on Supplementary Order Paper 123 in the name of Denise Lee to clause 14 be agreed to:

in new section 222AD(5), delete the word “An” and replace with “Any”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 123 in the name of Denise Lee to clause 14 be agreed to.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 126 in the name of Jo Hayes to clause 14A be agreed to.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment not agreed to.

The question was put that the following amendment in the name of Matt King to the proposed amendment set out on Supplementary Order Paper 125 in the name of the Hon Nikki Kaye to clause 14A be agreed to:

in new section 222AM(2), delete the word “must” and insert the word “may”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Matt King to the proposed amendment set out on Supplementary Order Paper 125 in the name of the Hon Nikki Kaye to clause 14A be agreed to:

in new section 222AM(2), delete the word “50%” and insert the word “60%”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Matt King to the proposed amendment set out on Supplementary Order Paper 125 in the name of the Hon Nikki Kaye to clause 14A be agreed to:

in new section 222AM(2), delete the word “50%” and insert the word “66%”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Matt King to the proposed amendment set out on Supplementary Order Paper 125 in the name of the Hon Nikki Kaye to clause 14A be agreed to:

in new section 222AM(2), delete the word “1” and insert the word “2”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Andrew Falloon to the proposed amendment set out on Supplementary Order Paper 125 in the name of the Hon Nikki Kaye to clause 14A be agreed to:

in new section 222AM(2), delete the word “1” and insert the word “3”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 125 in the name of the Hon Nikki Kaye to clause 14A be agreed to.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 127 in the name of Simeon Brown to clause 15 be agreed to.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment not agreed to.

The question was put that the following amendment in the name of Andrew Falloon to the proposed amendment set out on Supplementary Order Paper 128 in the name of Denise Lee to clause 15 be agreed to:

in new section 292A(4), delete “the higher of”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Andrew Falloon to the proposed amendment set out on Supplementary Order Paper 128 in the name of Denise Lee to clause 15 be agreed to:

in new section 292A(4), before the word “amount” insert the word “total”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Andrew Falloon to the proposed amendment set out on Supplementary Order Paper 128 to clause 15 be agreed to:

in new section 292A(4) delete “$5,000” and insert “$7,000”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 128 in the name of Denise Lee to clause 15 be agreed to.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment not agreed to.

The question was put that the following amendment in the name of Andrew Falloon to the proposed amendment set out on Supplementary Order Paper 129 in the name of Nicola Willis to clause 15 be agreed to:

in new section 292A(4), delete “$5,000” and insert “$7,500”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Andrew Falloon to the proposed amendment set out on Supplementary Order Paper 129 in the name of Nicola Willis to clause 15 be agreed to:

in new section 292A(4), before the word “amount” insert the word “total”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 129 in the name of Nicola Willis to clause 15 be agreed to.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 130 in the name of the Hon Nikki Kaye to clause 15 be agreed to.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment not agreed to.

The question was put that the following amendment in the name of Nuk Korako to the proposed amendment set out on Supplementary Order Paper 131 in the name of Erica Stanford to clause 15 be agreed to:

in new section 292A(4A), after “a tertiary organisation” insert “for a period of 15 years following the date of conviction”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Nuk Korako to the proposed amendment set out on Supplementary Order Paper 131 in the name of Erica Stanford be agreed to:

in new section 29A(4), delete “a tertiary” and insert “any eligible tertiary”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 131 in the name of Erica Stanford to clause 15 be agreed to.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment not agreed to.

The question was put that the following amendment in the name of Nuk Korako to the proposed amendment set out on Supplementary Order Paper 132 in the name of Jo Hayes to clause 15 be agreed to:

in new section 292A(4A), after student loan” insert “for a period of 15 years following the date of conviction”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 132 in the name of Jo Hayes to clause 15 be agreed to.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 105 in the name of Simeon Brown to clause 18 be agreed to.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment not agreed to.

The question was put that the following amendment in the name of the Hon Nikki Kaye to clause 18 be agreed to:

add to new clause 12 the following subclause:

(4) The board of any specified State school that has previously transitioned from a partnership school kura hourua must provide half yearly reports to the Ministry of Education summarising the response from parents of that transition

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment not agreed to.

The question was put that the following amendment in the name of Dr Shane Reti to the proposed amendment set out on Supplementary Order Paper 106 in the name of Nicola Willis to clause 18 be agreed to:

in new section 12A(2)(c), replace “principal or the board” with “principal and the board”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Dr Shane Reti to the proposed amendment set out on Supplementary Order Paper 106 in the name of Nicola Willis to clause 18 be agreed to:

in new section 12A(2)(c), delete the word “wholly”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Melissa Lee to the proposed amendment set out on Supplementary Order Paper 106 in the name of Nicola Willis to clause 18 be agreed to:

in new section 12A(2)(c), after “board” insert “by majority resolution”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 106 in the name of Nicola Willis to clause 18 be agreed to.

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

Ayes 56

New Zealand National 55; ACT New Zealand 1.

Noes 63

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

Amendment not agreed to.

The question was put that the following amendment in the name of the Hon Nikki Kaye to new clause 12A(2) be agreed to:

insert new clause 12A(2)(c).

(c) The employee’s contract with the specified partnership school kura hourua was due to expire before 1 January 2019.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment not agreed to.

The question was put that the following amendment in the name of Dr Shane Reti to the proposed amendment set out on Supplementary Order Paper 107 in the name of Erica Stanford to clause 18 be agreed to:

in new section 12A(2A), delete all words after “provided” and replace with “they make a written undertaking to become a registered teacher as soon as is practicable.”

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Dr Shane Reti to the proposed amendment set out on Supplementary Order Paper 107 in the name of Erica Stanford to clause 18 be agreed to:

in new section 12A(2A) replace “undertaking the process of becoming” with “eligible to become”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Dr Shane Reti to the proposed amendment set out on Supplementary Order Paper 107 in the name of Erica Stanford to clause 18 be agreed to:

in new section 12A(2A), replace “not a registered teacher” with “not currently a registered teacher or who was previously a registered teacher”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Nuk Korako to the proposed amendment set out on Supplementary Order Paper 107 in the name of Erica Stanford to clause 18 be agreed to:

in new section 12A(2A), replace “may” with “shall”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Nuk Korako to the proposed amendment set out on Supplementary Order Paper 107 in the name of Erica Stanford to clause 18 be agreed to:

in new section 12A(2A), replace “undertaking” with “have started”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 107 in the name of Erica Stanford to clause 18 be agreed to.

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

Ayes 56

New Zealand National 55; ACT New Zealand 1.

Noes 63

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

Amendment not agreed to.

The question was put that the following amendment in the name of Kanwaljit Singh Bakshi to the proposed amendment set out on Supplementary Order Paper 108 in the name of Erica Stanford to clause 18 be agreed to:

in new section 12AB, replace “may” with “shall”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Kanwaljit Singh Bakshi to the proposed amendment set out on Supplementary Order Paper 108 in the name of Erica Stanford to clause 18 be agreed to:

in new section 12AB, replace “5 years” with “7 years”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Kanwaljit Singh Bakshi to the proposed amendment set out on Supplementary Order Paper 108 in the name of Erica Stanford to clause 18 be agreed to:

in new section 12AB, replace “5 years” with “3 years”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Kanwaljit Singh Bakshi to the proposed amendment set out on Supplementary Order Paper 108 in the name of Erica Stanford to clause 18 be agreed to:

in new section 12AB, after “A chief executive” insert “or equivalent”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 108 in the name of Erica Stanford to clause 18 be agreed to.

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

Ayes 56

New Zealand National 55; ACT New Zealand 1.

Noes 63

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

Amendment not agreed to.

The question was put that the following amendment in the name of Melissa Lee to the proposed amendment set out on Supplementary Order Paper 109 in the name of Erica Stanford to clause 18 be agreed to:

in new section 12A(AB), replace “must” with “may”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Melissa Lee to the proposed amendment set out on Supplementary Order Paper 109 in the name of Erica Stanford to clause 18 be agreed to:

in new section 12A(AB), replace “The funding” with “All funding”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Melissa Lee to the proposed amendment set out on Supplementary Order Paper 109 in the name of Erica Stanford to clause 18 be agreed to:

in new section 12A(AB), replace “5 years” with “7 years”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Melissa Lee to the proposed amendment set out on Supplementary Order Paper 109 in the name of Erica Stanford to clause 18 be agreed to:

in new section 12A(AB), replace “5 years” with “3 years”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 109 in the name of Erica Stanford to clause 18 be agreed to.

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

Ayes 56

New Zealand National 55; ACT New Zealand 1.

Noes 63

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

Amendment not agreed to.

The question was put that the following amendment in the name of Andrew Falloon to the proposed amendment set out on Supplementary Order Paper 110 in the name of Jo Hayes to clause 18 be agreed to:

in new section 12AB, after “carried over to” insert “or an equivalent policy implemented in”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Ian McKelvie to the proposed amendment set out on Supplementary Order Paper 110 in the name of Jo Hayes to clause 18 be agreed to:

in new section 12AB, replace “must” with “may”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Ian McKelvie to the proposed amendment set out on Supplementary Order Paper 110 in the name of Jo Hayes to clause 18 be agreed to:

in new section 12AB, replace “5 years” with “7 years”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Ian McKelvie to the proposed amendment set out on Supplementary Order Paper 110 in the name of Jo Hayes to clause 18 be agreed to:

In new section 12AB, replace “5 years” with “3 years”.

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

Ayes 55

New Zealand National 55.

Noes 63

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

Amendment to the amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 110 in the name of Jo Hayes to clause 18 be agreed to.

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

Ayes 56

New Zealand National 55; ACT New Zealand 1.

Noes 63

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

Amendment not agreed to.

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

Ayes 63

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

Noes 55

New Zealand National 55.

Part 1 agreed to.

Part 2 Amendments to other enactments

Hon TIM MACINDOE (National—Hamilton West): I raise a point of order, Mr Chairperson. I’m just seeking your guidance in light of an earlier ruling, and I’m in no way questioning that, but in light of the fact that partnership schools were the policy of the ACT Party and the member for Epsom was the Parliamentary Under-Secretary to the Minister of Education in the previous Parliament, who did much of the work on this, I’m just seeking clarification as to whether he is able to take part in the debate on these particular amendments, given that partnership schools are a significant aspect of the bill we’re debating, and I’m not quite sure whether he is allowed to return to the Chamber in order to take part in the debate.

CHAIRPERSON (Adrian Rurawhe): I thank the member for his point of order. The rule is that it’s solely up to the presiding officer as to when the member returns. I will discuss this matter with the Serjeant-at-Arms, and he will be informed of that decision.

Hon CHRIS HIPKINS (Minister of Education): I’m happy to take a call on the second part of this bill, which is on changes to the education update legislation passed by the previous Government. I hope most of the provisions in this second part will be less controversial than those in the first part, although I’m always open to being surprised.

The Education (Update) Amendment Bill, among other things, passed what are some of the most significant changes to school planning and reporting requirements, compliance requirements, that New Zealand has seen in quite some time, and replaced the requirement for schools to have a charter with the requirement for schools to have a four-year strategic plan setting out the board’s strategy for achieving its objectives. It requires them to prepare an annual implementation plan to give effect to the strategic plan, and to prepare an annual report.

The amendments in this bill make some minor but significant, you could argue, changes to that. The first thing it does is it moves out the requirement for these new provisions to come into force, from the beginning of next year, 2019, to the beginning of 2020. As I indicated, these are quite significant changes, and schools have indicated that they would like to have more time in order to prepare for those. I think that that’s reasonable, given the significance of the change.

It changes the term of the strategic plan from four years, as proposed, to three years. One of the arguments that schools and boards have made in favour of that is that that would align that with the board of trustees’ electoral cycle, and that’s something that I think does make sense.

It reinstates a requirement that the Secretary for Education consult with the Auditor-General on the form of the annual financial statements. This was a mistake in the previous legislation, in that it was omitted, so we are fixing the mistake in that. And it supports the transition to the new arrangement by allowing, for example, a school that has only recently adopted a charter to adopt that charter as its first strategic plan and not have to go through the whole exercise all over again.

So these are relatively straightforward, I hope, and common-sense amendments to what is quite a significant change to schools’ planning and reporting requirements.

Hon NIKKI KAYE (National—Auckland Central): Look, I want to take a call on this, and I just want to comment on a number of things that the Minister Chris Hipkins has said. As I’ve said before in this House, as much as possible, we want to try and get cross-party agreement on areas that shouldn’t be contentious. The reason that National members on this side will want to take a number of calls around this part is because the provisions, while there aren’t that many of them, are hugely significant in the context of the accountability of our education system.

Now, I agree with the Minister in terms of what he’s just outlined: it was National that put through the Education (Update) Amendment Bill 2017 to shift to this new framework around accountability. But let’s just talk through some of the amendments. I do have a range of questions for the Minister, and I’m glad that he’s in the chair so that he can take a number of calls on them, but, again, let’s just remind ourselves what we’re dealing with here. We’re moving to a new reporting framework.

So the first question that I have is around this amendment, which is “We’re just going to shift out the transition from January 2019 to January 2020.” Look, I’ve been in this House; I’ve seen many pieces of legislation. People tend to pluck out January as the month. Now, that may make sense in this context—we have a school year; many schools come back at the end of January or early February—but it would be good for this committee to know, given that as much as possible we want to support amendments that make sense, why it is that we need those additional 12 months. I know that we’ve had a bit of discussion in the Education and Workforce Committee, but it would be good if he could talk to that.

Then, I guess, one of the parts I am very supportive of, and I’m sure my colleagues will have a number of things to say about it—I was swayed by the New Zealand School Trustees Association, and can I acknowledge Lorraine Kerr—is just this issue of shifting from a four-year cycle to a three-year cycle. Again, there were several submissions on that. On this side of the committee, we think that does make sense, but really the devil is in the detail. Again, I just want to raise a couple of issues that were raised in select committee and by officials, and it comes back to the process, and particularly the powers of the sector. While that three-year cycle might make sense for schools in the normal course of their business, of course, in the select committee process, many of us were sitting there and recognising that schools will be established outside that process.

There will be multiple issues, when you’ve got 2,500 schools, which will occur that mean that they may need to fall out of cycle. There is a provision in the bill that addresses that, but it’s not detailed in terms of the criteria that the secretary might need to take into account. We didn’t have a whole lot of advice, from my perspective, around what those situations may be, and it is really important because, again, we need to be thinking about those schools that could be in a vulnerable situation or in a situation whereby they’ve been established mid-cycle. There is a provision there. There’s not a lot of detail around the exercise of the secretary’s powers in this particular situation. I am interested in the Minister’s view: has he had advice around how often we think that we may see something done mid-cycle?

I think the other issue that I want to raise—which, again, has been dealt with in the amendments in this part—is this issue of, effectively, financial sign-off. We’ve gone from two board members to the board member and principal—and, again, I have huge respect for the many principals out across New Zealand. At an operational level, I would love them to be spending less time on things like infrastructure and potentially financial issues, so that the board could get on with their job, but clearly there has been a shift, as part of this legislation, to go from two board members to a principal and a board member. So I think it is worthwhile for this committee to traverse that, and I would love the Minister to stand up and take a call and talk us through that.

I think the other thing that I did also want to raise is just around this issue of 2020, and the fact that, effectively, the strategic plan will become the charter at that point. I think that, again, the conversation that some of my colleagues and I have had has been around the shift—[Time expired]

DENISE LEE (National—Maungakiekie): Thank you very much, Madam Chair. I appreciate the opportunity to take this call. We’re in Part 2. It’s my first call on Part 2, and I have an amendment that I wish to speak to. It’s one of those amendments where you could possibly say, “What’s in a word?”—and in this regard, a lot. It seeks to amend clause 21(13). In new section 9A(2) in clause 21(13), replace the word “may” with “must”. So there’s the word, but wait until you hear my rationale around replacing the “must”.

Tamati Coffey: Give it to us, Denise.

DENISE LEE: I’m going to give it to you. It’s going to be good. It’s very weighty—very weighty.

What this amendment does is it ensures that when amending the strategic plan of a board—so this is very important—the board “must” consult with the community, not “may” consult with the community. Now, that is weighty, and we’ve got nodding heads on the other side of the committee. The board must consult with the community, not may. It’s not just the community either, to the other members on that side of the committee; it’s also staff and students, and all this must take place before that approval of the strategic plan be given by the secretary.

Now, if we just step back a little bit, at a higher level, I guess you could say, what this is doing is—and we’re, obviously, on the part where we’re looking at amendments to the Education (Update) Amendment Act of 2017. So that’s where this takes place. In that particular Act, “In section 158(2), [and] after the new clause 9 of schedule 6 of the principal Act,”—that’s where in this current bill that we’re debating this morning—there is an insertion that’s about strategic plans. It says in new section 9A(1) in clause 21(13), “A board may amend its strategic plan, but if a proposed amendment is significant the board must obtain the Secretary’s approval of the amendment before amending the plan.”

So this is new. And while I agree with the intent here that if an amendment to a strategic plan has enough gravity—I guess you could say—that it’s going to require the secretary to look it over, that’s a good principle, I think. But I do have a query and a question for the Minister of Education around the word “significant”. How will it be deemed to be significant? What’s that bar? Where’s the test? Where’s the line if a proposed amendment is “significant” to warrant the secretary stepping in at that stage and approving the amendment? It’s a query. While I think the intent is right, it could be quite interesting and variable to determine where “significance” kicks in.

Now, back to my one word change. New section 9A(2) says, “Before approving an amendment, the Secretary may require the board to consult the school community, staff, students, or any other person or body [that they deem] should be [considered].” Why is it “may”? Shouldn’t it be “must”: “the Secretary must consult”. Now, this is a one word change of absolute gravity and gravitas, right? Why should it be “may” consult? Of course it should be “must” consult. If you look through all of the education bills that we’ve debated over the last couple of months—and, indeed, the content of this—you will see, scattered all throughout, the principle of consultation.

We’ve heard members on the other side of the House speak strongly, vigorously, and often on principles of democracy. To my mind is coming the Education (Teaching Council of Aotearoa New Zealand) Amendment Act and how much the other side of the committee really underscored the principles of consultation. Well, here we are. We’ve got a chance—right here, right now—to agree that if the secretary deems that the bar is such that they should step in and be part of a school changing its strategic plan, well then, it should be a “must”. Why would it just involve the board and the secretary? Why not—and again it’s the school community, the staff, the students, or any other person or body that the secretary considers should be consulted.

I would like to underscore, one last time, the principle of consultation, and remind the other side of the committee that it’s a principle that they have said that they hold dear. I don’t think that we should be apologetic about putting in the word “must”. If the secretary thinks that there’s something going on in a school that requires their oversight, well then, it should require the oversight of the all-important and very integral members that make up the school community, the staff, the students, or any other person that the secretary sees fit.

I’m hoping that when we get to voting, this will be something that the other side of the committee pick up. I’m not sure they’re going to pick up much else, especially after—[Time expired]

ERICA STANFORD (National—East Coast Bays): Thank you, Madam Chair. I want to speak to my amendment that I have just tabled, which, in clause 21(13), after new clause 9B(2) of schedule 6 of the Education (Update) Amendment Act, inserts new clause 9B(3), which basically states that the strategic plan for a school which has transitioned from a partnership school to a designated character school expires five years after the plan takes effect, rather than three which is currently there.

There are many reasons for this, but I want to go back to the fear that we’ve always had about the transitioning of charter schools—that is, that all of those good things about charter schools that make them so successful will be lost. I had a number of Supplementary Order Papers in Part 1 that I didn’t get a chance to speak to today—and it was very sad—where I wanted greater transitioning of these charter schools into special character schools. I didn’t get to do that, but the only way that I feel that I can now do that is in this amendment, by extending out that strategic plan to five years.

Now, the reason that I want to do that, and I want the other side of the Chamber to consider that, is because of the learnings that we need to take from charter schools and why they’ve been so successful: why Māori achievement has been so good; why smaller class sizes, why pastoral care have been so good to these students; why, for example, at Vanguard Military School, exercise and discipline has been so good; why respect for your elders—and if we look at their results, low levels of truancy, and high achievement, they have been so successful. If we take a three-year plan and we put that out to five years, I think that we will have a much better chance of taking the amazing things that made those charter schools so successful and carrying them on.

One of the most worrying things that I and my colleagues have about this transition period is that there are all of these learnings from these charter schools that will disappear, because what we’re trying to do is take a square peg and fit it back into a round hole by this so-called transition. We keep bandying this word “transition” around. The Government are saying “transition” but, actually, what they’re doing is not transitioning at all; it’s just squashing something that doesn’t fit into something else. If we had a longer period for that strategic plan to take place, I would feel better about the fact that some of those learnings, some of the values, some of the things that make those charter schools so successful will actually be able to be carried on.

There are many things that have been stripped away from charter schools that we’re not going to get back. There will be changes in staff, the CEO won’t be there, the boards will be different, and the unregistered teachers will be gone. So there are a whole lot of things that made charter schools so successful that will be stripped away. All we’re left with is the strategic plan. It’s the only thing that we have left to make sure that we take the learnings, and we take the things that made charter schools so successful, and we implement those for as long as we possibly can.

I mentioned in many speeches before now that I worry that the Minister and the Government and the ministry won’t take into account the learnings from these charter schools. They’ve had some incredible successes in terms of their successes with Māori students and Pasifika students with achievement, with truancy rates, and we’re never going to understand why that occurred, because the model’s gone. If we have this longer period of transition with a longer strategic plan, I think that the ministry will have a much longer time to be able to take a look at the things that made charter schools so successful, and perhaps that can then spill over into special character schools.

There are so many learnings that we are not taking and if we had a five-year period under my amendment, I feel that the ministry and officials would have a much greater period of time to actually take a look at some of those really amazing successes, and perhaps, as I say, with other special character schools, maybe take those learnings and put them across them as well. We’ve seen the incredible success of many students at charter schools and it would be such a shame for us to waste that. I think a five-year period of transition, rather than a three-year period with a strategic plan is a much better idea and I hope the Minister takes that into account.

Hon TIM MACINDOE (National—Hamilton West): Thank you very much, Madam Chair. Kia orana. May I begin very quickly with a word of thanks. Last night, in a separate part, I asked Minister Hipkins some questions relating to fraud and the potential for fraud within the student loan scheme. At the time, he indicated he was unaware of any. He did go away and ask some questions, and I thank him for doing that. He has, nevertheless, now indicated that there is some, so I encourage him to continue to investigate that very serious issue, but I do want to acknowledge that.

However, I was concerned that a short time ago this morning he described the Opposition’s Supplementary Order Papers as filibustering. I want to assure him that this is a very significant bill. The Opposition is not filibustering. We’ve had three excellent speeches so far, since we started this debate, which have demonstrated the range of important issues that are under consideration—

Simeon Brown: Here’s the fourth speech.

Hon TIM MACINDOE: Thank you very much, Mr Brown, I appreciate that. Education matters. We all want the best schools in our communities, and what we’re talking about in this part of the debate relates very much to quality education. Could I just quickly acknowledge the outstanding schools in my own electorate, up in Hamilton. I’m very proud of them, and I thank each and every one of those who’re working in our schools, either in the teaching side or as board of trustee (BOT) or as parent teacher association members—that sort of thing. They all make a great contribution.

The Hon Nikki Kaye kicked off this particular debate in talking about the new reporting framework, which is obviously crucial to what we are now discussing, and she raised a question: why has January been reached as the date? Now, it isn’t a frivolous question, and I just want to add to the point that she made by pointing out that school staff, particularly management teams, have to work incredibly hard on a wide range of administrative matters, and, clearly, this strategic reporting is an administrative requirement.

Realistically, the only time in the year that they can have a bit of a break is over the Christmas holidays, leading into the early part of January, when most New Zealanders are enjoying a bit of a summer break. Therefore, while it may be, as the Hon Nikki Kaye has pointed out, logical to have a date in January, I want to ask the Minister whether he has actually consulted widely with school authorities—boards of trustees, management, etc.—in order to ascertain whether that will work for them, because it might be—I’m not saying it will be, but it might be—that a reporting date, say, to coincide with the end of the financial year, on 31 March, would work better or would at least be preferred. So I just want to endorse the Hon Nikki Kaye’s question and echo the great respect and appreciation she uttered for principals, boards of trustees, and teachers right around the country.

But I’d also want to endorse very strongly the amendment that has been put forward by my colleague the member for Maungakiekie, Denise Lee. Government members scoffed when she talked about an amendment which moves from the word “may” to “must”, and it appeared, at least to Tamati Coffey, to be of no consequence, but I want to ask the Minister: what is the reason for the vagueness? In fact, those two words are fundamentally different, and I do believe that members of the community in my area who do have a strong interest in the way their schools are managed might want to support Denise Lee’s amendment very strongly.

Now, let me give Tamati Coffey an example. He’s now an electorate member. A large number of people in his constituency and in mine will not care about this. Let’s acknowledge that at the outset. But there will be some—

Tamati Coffey: Very serious. Very serious.

Hon TIM MACINDOE: OK, so Tamati Coffey, who’s clearly not being serious at the moment, is nevertheless feigning interest. I do hope that Tamati Coffey will get up very soon to explain why he considers this is significant, because he owes it to Denise Lee to debate this particular clause.

I give the example to Tamati Coffey of those who may have stood for election in the last BOT elections but been unsuccessful. They may have had very genuine and strong reasons for seeking election, and they will no doubt continue to be watching their schools with great interest. One of the things they’ll be watching in particular will be the strategic planning, because that may well have a fundamental impact on the way they feel about how the issues they were concerned about are being resolved and as to whether they should put themselves forward in the next BOT elections in order to try to continue arguing for whatever it was they wanted to change. So there could be very good reasons for them to do that, and that is why I believe the word “must” must be inserted. Why have the vagueness of “may”? That simply says to a school that isn’t functioning well, “You don’t need to consult your community.” That is ridiculous and mustn’t be accepted.

CHAIRPERSON (Poto Williams): Before I call the next member, I just want to encourage members that it’s not really good practice to just repeat arguments that have already been presented. I’m looking for new material. This is quite a specific part of the bill—we’re dealing with clauses 21 and 22—and, while the arguments are well made, I don’t necessarily want to hear them several times. So I would encourage us to be looking to provide new arguments to these two clauses in Part 2.

Hon NIKKI KAYE (National—Auckland Central): Thank you very much, Madam Chair. Look—a few comments at the outset. I would, though, just acknowledge, at the beginning of my speech, that I haven’t had answers from the Minister to a range of questions that I have asked that are very specific to clauses 21 and 22. Just to recap in terms of the answers that I haven’t had answers to, they’re around both the 12-month period, which is going from January 2019 to January 2020, and I’ve also asked about this issue of shifting from two board members to, effectively, a board member and a principal. So I do want answers around that. One of the things I also want to deal with in this speech, and the reason I would say to Madam Chair this is so important, is that while people might think, “Well, these are minor amendments.”, this is about 2,500 schools and what the accountability framework is for those schools. So one word does matter. The process does matter.

I want to come back to a part of that process that is about, in the event that the board want to amend their strategic planning framework, the way that they go through that process with the Secretary for Education, what a significant issue is, and when it needs to be consulted. This is really important because it cuts to the heart of an aspect of our education system, which is that boards are the masters of their own destiny. We now are writing into law a process that does involve the secretary having greater power, in my view. I think we should have an explanation from the Minister about what his interpretation is of the word “significant”, because that cuts to the heart of how often we think that boards are going to be told by the Ministry of Education, “Well, you need to go out and consult on this.” That is important because that means it’s community time. As I say, I completely support Denise Lee’s very specific amendment around changing that word, but this is another issue. This cuts to the heart of the word “significant” and what that actually means, because that will determine how many boards are, effectively, being rejected by the ministry and may need to go out and consult. So I would like the Minister to answer whether he’s had any advice on that.

The other thing I want to say, specifically around that, is it’s not uncommon in our education system for the Secretary for Education to delegate that power. We know how busy she is: we’ve got 2,500 schools. At the moment, part of the whole aspect of these provisions is now timing it to this three-year cycle, which does mean that we are compacting a process whereby we may have approval of the strategic planning frameworks. So what I am worried about is just to understand whether the Minister has sought advice as to whether the secretary may delegate that power—whether he thinks that’s likely. You know what it’s like: we get all of these strategic planning frameworks trying to be signed off at the same time. Is there an issue there in terms of workload, and should we be considering, actually, whether we should be having an amendment right now to make it explicitly clear that the secretary could delegate that to a deputy secretary?

I think the other thing that I did want to raise, specifically around the strategic plan and the transition that we’ve got under clause 21 and 21(13), is that this, again, cuts to the heart of exactly what the transition is. I do note that through the select committee process, we had this discussion about the statement of variance and what will actually occur as of January 2020 if, for schools, effectively, their charter becomes their strategic planning framework. So if we have a situation where a school hasn’t met its objectives and targets around achievement or, potentially, well-being, what do we actually think is going to happen there? Is it the case that some schools are going to get off scot-free in terms of not being able to report around major variances? Can the Minister give an absolute assurance to the committee that every community can expect, at the changeover of that transition, to see that variance? Again, there’s been a little bit of confusion in the Education and Workforce Committee about whether there will be a mandatory requirement for that to occur. Again, I’m looking at one of the provisions here—[Time expired]

SIMEON BROWN (National—Pakuranga): Thank you very much, Madam Chair, for the opportunity to take my first call on Part 2 of the Education Amendment Bill. I’d like to focus my contribution on clause 21 and in particular, firstly, in regards to the change of date from 1 January 2019 to 1 January 2020. I know this has been covered by a number of members on this side, but the question I want to ask the Minister is: why he is making this change so late in the piece? We understand that this bill—yes, it’s been before Parliament throughout the year, but schools and boards of trustees have been working towards 1 January 2019. They have been working towards a date which has been in law for a couple of years now. They have been putting together plans around the changes which the Education (Update) Amendment Bill put in place. As he outlined, he thinks these changes aren’t that significant. We would dispute that; they are significant, they do make some substantial changes. So why make a change so late in the piece?

The second question which follows on from that is in regards to the change in the cycle—the four-year cycle or three-year cycle. Why is he making this change when he currently has the Tomorrow’s Schools review under way, which will potentially make substantial changes to the ways that our boards of trustees are managed, potentially how they’re elected, potentially how the community’s involved, how the school is involved—there are a range of different decisions which are being looked at as part of that review. So is this bill pre-empting that review? Is this bill making a call which that review may require further law changes towards? Is this legislation meaning that that will need to be looked at again?

I think the Minister owes our schools, our boards of trustees, our principals, the unions, and our teachers and parents the opportunity to understand where he thinks this is going so that there is an understanding as to whether there may be a further change in the future and potentially back to a four-year cycle, maybe to a five-year cycle, which has been recommended by other members such as Erica Stanford on this side of the Chamber. So I think the Minister has some big questions to answer, particularly in light of all of these reviews that he is currently undertaking in the education sector.

The other contribution that I’d like to make at this stage is in regards to the changes being made in section 43 of the Education (Update) Amendment Bill—this is in clause 21(3) and (4)—which basically repeals two sections in the principal Act; that is, the new section 61(b), which was put in through the Education (Update) Amendment Bill and also replaces new section 62(2) of the principal Act. Essentially, what these changes do is they remove any reference to national standards in the principal Act and the reason for that would be because he’s removing the whole basis of national standards. But I think the issue here which is—you know, the Minister said these aren’t significant changes; this is a very, very significant change because this goes to the crux of how schools are monitored and how they are held to be accountable.

What the changes do, essentially, is remove reference to national standards and change it, in new section 62(2), to “Monitoring and evaluating must include, but is not limited to, monitoring and evaluating the performance of the students in relation to—(a) any foundation curriculum policy statements and national curriculum statements in force under section 60A;”. Essentially, what that does is that it says, well, we’re not going to measure schools according to national standards because we’ve got rid of them, but we’re going to measure them according to any foundation curriculum policy statements and national curriculum statements.

Is the Minister satisfied that this is going to provide accountability for parents and students to ensure that they know where their child is at, how their child is doing with numeracy and literacy, and to ensure that they are progressing positively along the educational journey? So I challenge the Minister to actually explain to this committee why he thinks that’s just some sort of minor inconsequential amendment when this is a significant part of this legislation that removes significant accountability measures from the bill.

Hon CHRIS HIPKINS (Minister of Education): I’ll respond to the arguments that have been raised so far. There’s been quite a lot of comment on why extend the requirements out by 12 months for the new strategic plans to be in place. There’s a couple of reasons for that. One is that schools have indicated that they’d like more time, but one of the other ones that’s quite significant is that there is an interrelationship between the schools’ strategic plans and the statement of National Education and Learning Priorities (NELPs), which the Government is now required to put in place as well. There are some consultation requirements around that and the Government, of course, has begun to fulfil its commitments under the requirements to put NELPs in place. There is quite a lot of logic in having the NELPs in place before schools have to adopt their strategic plans, so this will allow for a better sequencing of that work to take place.

Nikki Kaye asked about why have a principal and a board member having financial sign-off rather than two board members. The reason for that is it simply reinstates the status quo that applied prior to the mistake being made. So, basically, it isn’t making a change; it’s reinstating what was the previous status quo. The requirement around two board members applies to other Crown entities, so this was intended to reinstate the status quo.

Erica Stanford covered a number of issues around charter schools which we have talked about at length already in the earlier parts of this debate, but, particularly, she wanted to extend the charter school plans to apply for five years rather than for three years. There isn’t really any good justification for treating one group of designated character schools—which is what most of them will become; some of them will become integrated schools—differently to the others, and so I wouldn’t support that.

Tim Macindoe asked why the calendar year. It is simply because it aligns with the school year and, actually, it would be impractical for schools to have a year that was based on something other than a calendar year. It does create some accounting challenges for government, of course, who run a different year, and so school years are split across two calendar years, but we’ve been doing that for years.

Simeon Brown asked why make this change so late. The answer is we’re not, actually. We introduced this legislation some time ago. It’s been through a full six months’ select committee process—in fact, longer than six months, because the select committee asked for extra time to consider it—and, therefore, we had foreshadowed well in advance to schools that this extension of time was coming.

Then, finally, he referenced the review of Tomorrow’s Schools and asked whether this would pre-empt it. No, it doesn’t. Actually, pushing out the time frame allows more time for any implications from the review of Tomorrow’s Schools to be considered.

With regards to the powers of the Secretary of Education and the issue around consultation and what’s significant, there are always going to be subjective judgments around what is deemed to be significant. Ultimately, I think if we wanted to set very specific criteria in that, it would kind of defeat the purpose of the flexibility that we’re trying to build in. We do want to be a little more flexible. If you set really rigid criteria, you get absurd situations where a school finds that they are trying to make what is a relatively insignificant change to their strategic plan, but because it happens to hit a particular criterion, you end up with a bizarre situation where they can’t make what are relatively minor changes.

So there’s going to be an element of subjectivity. Any law change like this does create subjectivity, but, of course, there’s a democratic answer to that. If school communities don’t feel that their school boards are consulting them sufficiently, then they have a board election every three years, and aligning the strategic plan with the three-year electoral cycle actually enhances that level of accountability.

Dr PARMJEET PARMAR (National): Thank you, Madam Chair, for this opportunity. When we look at this whole bill, there are five main objectives. Part 1 covers some of the things that are to support these main five objectives and there are things in Part 2 that support these five objectives. I want to focus in Part 2 on clause 21(4) because out of the five main objectives, one of the objectives, I believe, is a very important one. We can say, yeah, it’s resolving errors and omissions—we can fully understand that; we have no issues with that—but there is the objective that says that it is to strengthen the quality of school education by removing the provisions relating to national standards and the partnership school model from legislation. In this, I’m really passionate about the reporting system in our education system, so I would like to talk about clause 21(4), because that is actually to give effect to the policy objective of removal of national standards.

I repeatedly hear, when we talk about national standards from the Minister, that there is no evidence that national standards have improved the performance of students. I actually—

CHAIRPERSON (Poto Williams): Order! Dr Parmar, we have traversed this discussion quite fully in the previous part. I will ask you to stick specifically to clauses 21 and 22, and your arguments for the discussion on clause 21(4). Thank you.

Dr PARMJEET PARMAR: Thank you. So what I’m talking about is clause 21(4). In subclause (4), it says, “In section 43, replace new section 62(2) of the principal Act with: ‘(2) Monitoring and evaluating must include, but is not limited to, monitoring and evaluating the performance of the students in relation to—(a) any foundation curriculum policy statements and national curriculum statements in force under section 60A; and (b) any qualification systems referred to in section 61(c) that are offered at the school.’ ” So this comes to the fact that in the Education Act 1989, section 43 is about requiring monitoring and reporting of national standards, and that is where my argument comes—that, repeatedly, we hear that national standards are not helping in the improvement of students’ performance. What I would like to ask the Minister is to give us some evidence, because we haven’t heard the evidence that the Minister has used to base this argument on.

We haven’t heard about the evidence. This is a reporting system that we are talking about, and what we are saying is that we want to stick to that reporting system, but what the Minister has jumped to is the performance of students. So that is another effect that we can see from having a good reporting system. But when the Minister says repeatedly that there is no evidence that student performance has improved because of the system that he is replacing with this new subclause (4) here in clause 21, I want to know what the evidence is that the Minister is basing his—

CHAIRPERSON (Poto Williams): Order! Dr Parmar, we’ve had this discussion in Part 1. We are not having it again. Please move on.

Dr PARMJEET PARMAR: Because this clause 21 and subclause (4) relates to—

CHAIRPERSON (Poto Williams): Do I need to repeat myself? We are not having this discussion again. Please move on to other arguments.

Dr PARMJEET PARMAR: So I actually thought that it would be good to get that answer from the Minister—that’s why I raised this, because we are really passionate about this part in this whole bill.

Now, we also know that, yeah, we can fully understand that maybe there is no data available because from day one, Labour has been against national standards. We know that they wanted to replace national standards with another kind of reporting system that we are seeing through this legislation, and this was even before someone could evaluate how that system was going to work. So, from day one, when someone is totally against a system, then we do not know if the time that has been given for the national standards to work was enough for its evaluation, and we do not get any kind of answer from the Government on this big change that the Government is making in this legislation, which, of course, is divided in Part 1 and Part 2 to give effect to the objective of the policy.

Now, the important point here, as some of my colleagues have already discussed, is clause 21(2), where we are talking about the commencement date replacement, and, again, yes, I’ve heard the Minister—

CHAIRPERSON (Poto Williams): Yes, and the Minister has answered that question. Thank you.

Dr PARMJEET PARMAR: I’m just responding to the Minister.

CHAIRPERSON (Poto Williams): I have already made a ruling that I’m not wanting us to traverse arguments that have already been expressed by your colleagues in this part, and the Minister has already answered that question.

Dr PARMJEET PARMAR: Madam Chair, I fully appreciate that, but then we don’t have the opportunity in this debate to actually go back and ask another question on the same subclause to the Minister.

NICOLA WILLIS (National): Thank you, Madam Chair. I rise to make a contribution on this Part 2 of the Education Amendment Bill, and in doing so I want to focus in this contribution in particular on those aspects that relate to the national standards provisions that have been removed. It’s worth noting right from the outset that these amendments in Part 2, of course, amend the Education (Update) Amendment Act 2017. That amendment Act in 2017 was all about putting the progress and achievement of children and young people at the heart of the education system, and in doing so it set out clear objectives and a clear framework which schools were to implement in order to ensure that the information they provided parents and their community about the achievement and progress of students was clear, was comparable, and was meaningful across the country over time.

So when we turn to what this amendment in Part 2 does, we see at new section 62(2), inserted by clause 21(4), new requirements around monitoring and evaluation, and what that monitoring and evaluation must include. Madam Chair, you will see that this monitoring and evaluation relates to curriculum policy statements and relates to the qualification system, but what is not there, and what this amendment removes, is the requirement for the provision of a base against which the board’s actual performance can be later assessed. And I want to raise this point because it goes to the heart of what national standards provide as a reporting framework for a school board, which is now removed in its entirety with this legislation.

Of course, monitoring and evaluation is only as effective as the objective measures against which it occurs. So what we will now have, if we are to read Part 2 and the amendments that it puts in place, is a situation where, up and down the country, there will be statements of variance that vary hugely from school to school. So we see, in new section 87(7)(a) inserted by clause 21(5), that “any variance between the school’s performance and the achievement of the school’s objectives set out in its strategic plan and annual implementation plan; and (b) any matters required by regulations …”. So, of course, the question that this raises is: what is the one true thing that schools will be reporting against? Because one school might do one form of assessment; another school might do a different form of assessment. One school might choose to report in some detail on literacy and numeracy, and another school may choose not to. And so that is what is lost with these amendments.

It is the systematic unpicking of that Education (Update) Amendment Act that concerns members on this side of the House, because, of course, that was a bold piece of legislation that said, “Actually let’s fundamentally update our education laws to ensure the best possible information is available and that students’ achievement is put at the heart of the education system.” And here we have an unpicking that is of the nit-picking variety and, I think, adds very little on the scale that we have seen previously.

I want to turn to the other amendments that we find in this Part 2. In particular, we’ve already had some debate about the movement of the commencement date, but I just want to add to that that isn’t it symbolic of this Government that, when it comes to progress, when it comes to change, what they like to offer is pushing things out further into the future. So we had a National Government come and amend an Act to put student achievement at the heart, and say “Let’s make sure that all this is in place by 2019.”, and then we had a Labour Government come in and say, “Oh, well, we’ll nit-pick around some of the details of that and we’ll push it out to 2020.”—entirely symbolic of a Government whose whole approach is to set up working groups, have grand discussions, have lots of hui, but not actually get on with the important work of improving what’s happening in our schools.

We then have this question of what happens with boards if their strategic plan is not replaced, and we have this idea that they will just continue to have effect. We have this concept that boards will be enabled to amend their strategic plans and that boards will be required to get approval from the Secretary of Education for any significant alteration.

Now, all of these subclauses simply go to highlight that, actually, a strategic plan and the planning that a board of trustees is doing on behalf of a school and its community is significant. It’s significant enough that we have big expectations around how often those plans are reviewed, the role of the secretary in reviewing them, and we do expect that from time to time significant amendments will occur, and yet it is not considered serious enough that we would have a baseline of what we expect to be reported, and I find that incredibly concerning, and it is these sorts of details at the expense of the big picture—[Time expired]

Hon RUTH DYSON (Senior Whip—Labour): I move, That the question be now put.

DAVID SEYMOUR (Leader—ACT): Well, thank you, Madam Chair. It’s nice to be back, and it’s nice to see you in the Chair. This committee stage debate is put in place by the Standing Orders so that a committee might debate whether or not the bill, as reported from the second reading, actually aligns with the intention of the House at second reading, and I intend, of course, Madam Chair, to stick very closely to that brief.

I’d like to draw your attention, for instance, to clause 21(9), which amends the treatment of a partnership school charter and, effectively, makes it the plan of a new special character or a new integrated school. I think that if someone was to ask themselves why exactly is this necessary, you see the Government’s intention and what it said it was trying to achieve in the second reading was actually the closure of partnership schools.

The Minister’s stated intent in public since he received his warrant has been that the partnership school model has no place in the New Zealand education system, and yet we are now seeing a proposal in the text of this bill which tells us that, actually, it’s all just exactly the same—that, actually, a charter school’s philosophy and ethos will simply be brought on and turned into the strategic plan of a board. I make the case that, actually, this part of the legislation does not reflect the Minister’s stated intentions. It does not reflect the agreement of the House at the second reading. What it does is it gives the lie to the rhetoric of the Minister and the Government, who have told us at great length that these schools are a failure when they put in legislation clauses that are there to ensure the smoothest transition possible. What it shows is that, actually, the Government accepts—contrary to what they’ve brought to the House at second reading—that the partnership school model worked, so much so that the provisions that were operating under a partnership school should be facilitated to continue as flawlessly as possible under new models, be they special character or be they integrated.

I go back one clause before that to clause 21(8), which says that the principal Act will say, instead of “for each 4-year period”, that charters will be “for each 3-year period”. Now at no time has it been made clear by the Government why a three-year period of planning for a school is better than a four-year period. We often have that debate in New Zealand politics about the term of this House, and there are good arguments for why a longer term actually allows educators to plan with greater certainty. Bear in mind that some of these schools cover seven year levels of students, so three years is nothing. Arguably, they should be able to plan over longer periods than even four years, but there’s never been an expression from the Government of why it is necessary, as clause 21(8) states, to actually shorten the time horizon of planning in these schools. I would argue that that is something that should be struck out of this legislation. Our educators need less bureaucratic interference and longer time horizons over which to plan, not shorter ones.

I’d also take you to clause 22, which considers amendments to other enactments. We could go through a few of them. The State Sector Act amendment, I think, is absolutely critical to debate in this stage because it seems to reveal perhaps a political difficulty for the Government but also a contradiction in the direction of this bill. We’ve heard considerable debate about how the Minister has said that national standards were not national and they were not very standard. Well, you know, he’s entitled to that view, but I think what he was trying to express was that education workplaces are eroding the goodwill of teachers through a lack of autonomy—through a lack of choice about how they conduct themselves and how they educate students—and I’m a bit sympathetic to that view. I think the Minister may actually have a point on national standards.

But we come to schedule 2 and amendments to other Acts—and, in particular, the State Sector Act—where we are going to remove the possibility of a State-funded school that is outside of the State Sector Act. You only have to look at the discussion and the debate over the last several weeks over teacher shortage, and it is precisely the inflexibility and the frustration that teachers feel that is making it more difficult to have teachers.

Now, again, I don’t believe that the Minister and the Government have been clear in their intention with this legislation that the real objective of abolishing partnership schools was nothing to do with funding, it was nothing to do with profit, and it was nothing to do with teachers’ registration status with the Teachers Council—no. This State Sector Act amendment tells us what it was really about, and it was really about ensuring that teachers would have to be employed upon a collective agreement if they were to work for a State-funded school. That’s what it was really about. It is incredibly pertinent to the political debate about schools and their teacher shortages today, as well as to whether or not this Act truly fits the stated intentions of the Government and what was debated at second reading, because we simply have not heard enough from the Minister about why it is that the State Sector Act must be amended so that all schools, including partnership schools—or whatever form they take—become a part of the State sector and, therefore, are bound by collective agreements.

Let me give an example of why this might be problematic. A well-circulated story in the New Zealand Herald just recently told the story of a woman from the Waikato who is about 60 years old. Her son is 30 years younger than her. They both have the same education. The only difference is that due to the grade inflation—which is another topic we could go into another time—her son was awarded a degree and she was awarded a diploma. Now, under the State Sector Act, that, of course, is what you expect. That is the result of decades of collective bargaining and one-size-fits-all agreements. In a partnership school, that would not be a problem because, being outside the State Sector Act, it would be possible to negotiate a contract based on the sponsor’s judgment or the principal’s judgment of the value of that particular teacher.

This part here, amending the State Sector Act, is going to take away that possibility, and I don’t think the Government has been remotely transparent in its public utterances or in its second reading speeches that the real intention of this legislation is not anything that they’ve talked about. It wasn’t about funding, it wasn’t about teachers’ class sizes, it wasn’t about registration, and it wasn’t about any of these other standards. It wasn’t about the curriculum. It was, fundamentally, about whether or not people employed in schools funded by the State would have to have union contracts, and, ironically, the Government is shooting itself in the foot because, contrary to the assertions that it’s made about national standards, it’s actually requiring teachers to work in a less flexible work environment. I would suggest that a good start to improving this bill before the third reading would actually be to remove that State sector—[Time expired]

Hon RUTH DYSON (Senior Whip—Labour): I move, That the question be now put.

A party vote was called for on the question, That the question be now put.

Ayes 63

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

Noes 56

New Zealand National 55; ACT New Zealand 1.

Motion agreed to.

The question was put that the following amendment in the name of Denise Lee to clause 21 be agreed to:

in new section 9A(2), replace “may” with “must”.

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

Ayes 56

New Zealand National 55; ACT New Zealand 1.

Noes 63

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

Amendment not agreed to.

The question was put that the following amendment in the name of Erica Stanford to clause 21(13) be agreed to:

in new section 9B insert the following subsection:

(3) The strategic plan for a school which has transitioned from a partnership school kura hourua to a designated character school expires 5 years after the plan takes effect.

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

Ayes 56

New Zealand National 55; ACT New Zealand 1.

Noes 63

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

Amendment not agreed to.

The question was put that the following amendment in the name of Erica Stanford to clause 21(3) be agreed to:

in new section 9A insert the following subsection:

(4) The Minister of Education must be consulted if the strategic plan to be amended is for a school that has transition from the partnership school kura hourua.

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

Ayes 56

New Zealand National 55; ACT New Zealand 1.

Noes 63

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

Amendment not agreed to.

The question was put that the following amendment in the name of Denise Lee to clause 21(13) be agreed to:

in new section 9A insert the following subsection:

(4) When amending the strategic plan of any schools that have transitioned from the partnership school kura hourua model, the board must include in the proposal a report on how this change is in line the values on which the partnership school kura hourua was originally founded.

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

Ayes 56

New Zealand National 55; ACT New Zealand 1.

Noes 63

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

Amendment not agreed to.

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

Ayes 63

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

Noes 56

New Zealand National 55; ACT New Zealand 1.

Part 2 agreed to.

New Part 3

CHAIRPERSON (Poto Williams): Members, I have received a tabled amendment from the Hon Nikki Kaye to insert a new Part 3 to require a review of this Act. This is out of order as being more properly associated with another part, consideration of which has been completed.

Schedules 1 and 2

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

Ayes 63

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

Noes 56

New Zealand National 55; ACT New Zealand 1.

Schedule 1 agreed to.

The question was put that the following amendment in the name of the Hon Nikki Kaye to schedule 2 be agreed to:

delete Part 1 of schedule 2.

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

Ayes 56

New Zealand National 55; ACT New Zealand 1.

Noes 63

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

Amendment not agreed to.

The question was put that the following amendment in the name of the Hon Nikki Kaye to schedule 2 be agreed to:

delete Part 2 of schedule 2.

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

Ayes 56

New Zealand National 55; ACT New Zealand 1.

Noes 63

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

Amendment not agreed to.

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

Ayes 63

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

Noes 56

New Zealand National 55; ACT New Zealand 1.

Schedule 2 agreed to.

Clauses 1 to 3

Hon NIKKI KAYE (National—Auckland Central): I have Supplementary Order Paper (SOP) 120, around the commencement of the provisions relating to partnership schools, and I am hoping, Madam Chair, and this is a bit of a plea—hang on, we’re going to have Mr Chair, who’s coming in to the Chair—that this is taken very seriously. The reason that we need to take my SOP, which argues the provisions around partnership schools to, effectively, not kick in until three months after the Wai 2770 claim has been heard—there’s multiple reasons for this.

The first reason is the Government talks a big game around Crown and Māori relations, but at the same time, and I want to go to the Minister’s actions with regard to this, a series of actions by the Crown have been not only arrogant and negligent—and I’d ask all members in this committee to listen to this time line, because it relates to the SOP that I have. Not only from a legal perspective should we be agreeing to my SOP but from a cost perspective, this claim is going to cost the Crown a lot more at the end of this because of the Crown’s actions, and I want to take you through them.

The Crown is served by a number of iwi leaders. They are served regarding this issue of partnership schools. Multiple grounds, from consultation to the impact to young Māori—a range of different issues are set out in a claim. The claim is made public. Many press releases are put out by iwi leaders. The Minister puts his head in the sand. He doesn’t bother to read the press releases, doesn’t bother to read the claim, and then, extraordinarily, in response to written questions from me, after months of iwi leaders being out there, like Sir Toby Curtis and Dame Iritana Te Rangi Tāwhiwhirangi, and people like Lance O’Sullivan, he claims—which creates another grievance for many of these iwi leaders—that the Crown has not been served.

Now, subsequent to that, we all know that he admits his error, and I want to acknowledge the reply that he gave to written question No. 15640. He threw Crown Law under a bus and said, “Well, actually, do you know what? Even though there are all these press releases, even though the Waitangi Tribunal claim’s on record,”—and even though he now claims he’s been getting weekly updates that monitor the claim—“I didn’t believe iwi leaders that this claim was served.” We now understand that Crown Law advised him of the error of advising him, even though he didn’t bother to do any due diligence himself, which does create bad blood between iwi leaders but also a number of people who have fought for this claim in the Waitangi Tribunal.

So I am asking the committee to please consider the relationship with iwi leaders and many Māori leaders who support this claim. Why are we pushing ahead with getting rid of the model when all the Minister needs to do is call them into his office, have a conversation, show them the respect that they deserve, and also acknowledge that he made some fundamental errors, instead of sending out a corrected question to myself?

Then, the other question that I have for the Minister is: he does say to me in parliamentary questions that he’s receiving weekly updates, so can he confirm for me that there has been discussion about an urgency application? I think journalists listening to the House today should be asking the questions of those iwi leaders, which is what is the contact between Chris Hipkins and those iwi leaders regarding the claim. What contact has the Ministry of Education had? What contact has Crown Law had? Has Andrew Little, as Minister of Justice, been involved in this? Have the Crown, in any shape or form—particularly given their negligence around process on these issues—bothered to contact those iwi leaders to talk about the claim?

I have a very substantial SOP that asks that the provisions of the partnership schools are delayed while these basic issues of decency and process are worked through, through the Waitangi Tribunal claim Wai 2770. I am asking the Minister in the chair: please, this is our last opportunity as a Parliament to understand what is going on and what you are thinking around the respect and the mana of these iwi leaders. Why are you ignoring this claim? Why won’t you just do the decent thing and delay those provisions until you’ve had an opportunity for the claimants to be heard?

Why can’t we do that? I don’t understand why we wouldn’t do the decent thing in this particular instance and give the mana and respect to those iwi leaders.

DAVID SEYMOUR (Leader—ACT): Thank you, Mr Chair. I want to put the arguments behind Nikki Kaye’s amendment on Supplementary Order Paper 120, because it goes to the heart not just of this legislation but actually to the New Zealand identity. You see—Mr Chair, I’m sure you’ll be familiar—there’s a debate over what the Treaty of Waitangi means. Does it mean, as it literally says, that our property rights are safe and that we all have the same rights and duties, and the Queen is sovereign? Or does it mean, as the courts have interpreted it for the last 30 years, that it is a partnership between two peoples coming together? So I’d like the Minister of Education to just tell us what the Government’s position is these days. Is it what might be described as the Don Brash description of the Treaty, one which I and ACT have some sympathy for—or is it the one that came out of the lands case in 1987? Is the Treaty a document giving individual rights or is it a partnership between two peoples? I’d very much like to know what the answer to that is.

Once the Minster’s answered that basic question—what does Te Tiriti mean to this Government?—then here’s another question: what is the standard for respecting a Treaty claim? This is not some vexatious claim put up to claim radio airwaves or make trouble or test the system; this is a claim with some of the most respected leaders in Māoridom publicly putting their name to it: Dame Iritana, Sir Toby Curtis—serious leaders of Māoridom who you would think, if the partnership principle of the Treaty has any weight, would be taken quite seriously. That’s the question: is this a high enough threshold for the Government to take notice?

Let me put some other context around this. In the Speech from the Throne of this Government, they said that there would be no more irrigation contracts except the ones that were in place, which would be honoured. I asked the Prime Minister in this House why the Government was honouring contracts with people creating irrigation channels—bits of concrete on farms. The Prime Minister said, “We’re honouring them because they’re contracts.” I said to her, why does that not apply to partnership schools kura hourua, and she had no answer. So what is the standard here? The Government says it believes in the Treaty as a partnership. It should be respectful of major figures in Māoridom bringing a Treaty claim over a piece of legislation, and yet it applies a lower standard of respect to this legislative process, to those claimants, to those students and sponsors and staff in partnership schools kura hourua than it does to irrigation schemes.

And here’s another standard. This Minister of Education in the chair has spent $1.5 million consulting people about what he thinks education should be like. He very magnanimously sends education officials to my office—I’m not sure if that’s a blessing, but he sends them anyway—and they ask me what I think, as a party leader, should be the future of NCEA or Tomorrow’s Schools. This is a Minister who is quite prepared to consult people, in a Government that’s quite prepared to honour contracts, but somehow the standard is that when senior figures in Māoridom come along and say “We don’t like this. We think this is a breach of the partnership principle of the Treaty.”, there’s no attention whatsoever.

Well, the Minister can stand up today and remedy that, and, if he doesn’t, I suggest some members of the Māori caucus might like to stand up and put him in his place, because they’ve got the power. You know, I’ll say to the Minister, “The only real important skill in politics is the ability to count, and 46 minus 13 is not a big enough number, mate.” So I’d ask the Minister: is he committed to sanctity of contract? Is he committed to the Treaty as a partnership? Will he commit to due process as he has with the rest of his education portfolio on this legislation? And, ultimately, will he support Nikki Kaye’s Supplementary Order Paper 120 so that this legislation goes through after we have heard from the Waitangi Tribunal on the future of partnership schools kura hourua?

Hon CHRIS HIPKINS (Minister of Education): The arguments around the establishment or disestablishment of charter schools were well canvassed earlier. The question before the committee is around two amendments put forward by the National Party—one in the name of Simeon Brown and the other in the name of Nikki Kaye—to delay the commencement of the provisions relating to the removal of charter schools. The Government does not support either of these amendments.

With regards to Simeon Brown’s amendment, he seems to have plucked a date out of thin air, 1 August 2020, from which they would apply. Actually, there are two separate issues here: one is that there’s a contractual process that the Government is going through with those schools at the moment. The timetables for that are all clear and have all been agreed, and I don’t want to create further uncertainty for those schools. There’s no need for an extension in the timetable for that, because the transition provisions cover any issues that have arisen from the existing contractual discussions.

With regard to Nikki Kaye’s amendment around the Waitangi Tribunal claim, I’m not going to break with the previous practice, which is that I’m not going to comment on a claim that is before the Waitangi Tribunal. That’s not been the practice of Ministers in the past, and my intention, as is the Government’s intention, is that we will follow the standard processes and practices that the Government follows in responding to that claim.

CHAIRPERSON (Adrian Rurawhe): Before I give the call to the Hon Nikki Kaye, can I just say that this is a very narrow debate on clauses 1, 2, and 3. I have allowed the discussion to go a fair way beyond those clauses, but I’d like to encourage members to speak and relate their arguments to those clauses.

Hon NIKKI KAYE (National—Auckland Central): Mr Chair, when the Minister makes a number of comments in response to this Supplementary Order Paper (SOP), I think I do have the opportunity to respond to those comments. The first comment that I want to make is that he has referred to uncertainty around contractual processes. That is not a legitimate argument, from my perspective, because what we also know is that he is not someone who should be lecturing us about contractual processes, given that he actually publicly announced the termination of all of the schools before he had even gone through a legal process. That’s the first point that I would make.

The second point that I would make is that the schools themselves have already made the decision to go into a designated character model. They’re very aware of what the processes are in terms of transition. There is no argument around the fact that they do need that certainty. They have that certainty; that’s been made public. They’re communicating with the Ministry of Education. But I do want to raise that I am aware that there are some multiple issues whereby the ministry has said one thing and now the schools are having to go back and ask for clarity around aspects of where schools are going to be located in the future and what they were promised financially. So I don’t agree with the Minister around the fact that, somehow, we need to pass these provisions for some certainty for schools, given they’ve had uncertainty for a period and also given his actions previously around the contractual issues.

The third point that I want to make is: let’s talk about the tradition. The reality is that he knows very well that Ministers have, in the past, commented on Waitangi Tribunal claims. That is not correct. They have commented on Waitangi Tribunal claims. The second thing that I would say is that this is a Government that has argued for a new era of Crown and Māori relations. The reality is that he has been negligent, as has already been set out, around the process of this claim, and all that we’re asking—even if he doesn’t want to comment on the nature of the claim—is whether this claim is progressing, from the Crown’s perspective, even a vanilla statement that says why the Crown wants to pass a law in the midst of that claim being considered.

The reason New Zealanders need to understand this is that if my SOP does not pass, New Zealanders need to understand there is a strong likelihood that the grievance of the people who have made the claim will be significantly more. That is the reality. The Crown has an obligation to consider this claim in good faith, and what members of the committee need to understand is that the action of not even meeting with the claimants, but also having negligent issues around process, and then passing a law in the midst of that claim being considered, could cost the taxpayer additional funds. That’s the reality. That is what the hard, cold reality is of the Minister deciding to progress with the legislation at this time. We have not had a satisfactory answer about, one, what other Ministers may be doing in relation to this claim. And there is no argument that they can’t say they are considering the claim, they’re meeting with the claimants, they’ve got a time frame whereby the Crown is going to respond—that does not at all jeopardise the nature of the basic elements of the claim. And, also, I think there’s a basic decency that they need to know that.

The other point that I made—and, again, I would like the Minister to respond specifically to this—is totally separate to a normal claim that’s going through the Waitangi Tribunal process. As I understand it, there has been an application for urgency. So does the Minister have a view around this? Because, ultimately, this Minister’s warrant will be in question if the taxpayer has to pay an extra $20 million to the schools and to iwi leaders as a result of the Minister deciding to push the legislation through rather than wait for the legislative provisions to be considered properly as part of the Waitangi Tribunal claim. Then people in this committee need to understand that and properly consider my SOP, which says, “Why don’t we wait until that claim has been properly considered and then effectively let those provisions go through?” We don’t agree with the provisions; we believe the schools have been doing an amazing job for vulnerable young people. We completely disagree with the Government’s actions in this regard, but at the very basic level, why not show respect and mana to those iwi leaders and allow due process? It’s not OK to hide behind a claim that somehow Ministers have never commented on Waitangi Tribunal claims.

KIRITAPU ALLAN (Assistant Whip—Labour): I move, That the question be now put.

DAVID SEYMOUR (Leader—ACT): Well, thank you very much, Mr Chair. Look, I think that there may be time to accept a closure motion from Kiritapu Allan, but it should be after the Minister has responded to some very serious questions that have been raised that he appears to have skirted around. I sometimes wonder what his caucus colleagues think about that.

Really, you can boil down the questions I asked in my last speech—what’s the standard for honouring contracts; what’s the standard for honouring the Treaty of Waitangi; how does this Government see the Treaty of Waitangi in New Zealand’s constitutional arrangements?—to a more practical question that Nikki Kaye has alluded to just now, and it’s this: what will the Minister do if he has passed this legislation and finds that the Waitangi Tribunal has an adverse finding? It’s going to be very difficult legally, but what about politically? Will he have the political capital within his own caucus to steamroll the Waitangi Tribunal? How will it make his Government look if the Minister for Treaty of Waitangi Negotiations, sitting here, said, “Well, look, the Waitangi Tribunal is something that we take seriously some of the time.”? I think that’s a real problem. And what will it look like for his ministerial warrant if he ends up having to go to court or pay out compensation as a result of that tribunal finding?

I think that the committee, before members vote on this amendment by Nikki Kaye, deserves answers, because if Nikki Kaye’s amendment was to pass, then the problem that’s being highlighted that the Minister doesn’t seem to have an answer for would be alleviated. It would be simple. The potential problem of the legislation being contradicted by the tribunal would be solved simply by not having the legislation come into force for three months after the tribunal finding. That would give the House three months to make any necessary amendments, to give respect to the Waitangi Tribunal. It’s actually not particularly complicated.

But I’d also like to talk about the commencement date more generally. If we imagine for a moment that the Waitangi Tribunal claim and all of the problems—political and legal—that it presents were not in place, then we might ask ourselves: well, what does it mean for New Zealand generally to have a commencement date that would make partnership school contracts illegal while many of them still have several years to go?

If you will excuse me, it is necessary to introduce a little philosophy. F A Hayek, when he tried to define liberty in his 1960 book, The Constitution of Liberty, saw that there were real difficulties with restraining the State in a principled way. He found that sometimes it was necessary for collective action to take place, that sometimes it was necessary for rulers and Governments to take arbitrary action. Liberty wasn’t as simple as just saying, “Every man is an island and nobody can coerce anyone else.”, because there are such things as public goods. There are such things as useful regulations. He sought to answer the question: well, how is it that people can be free and live in a free society? And Hayek’s answer—which is pretty standard, it has to be said, through most of the legal profession—is that we don’t know what arrangements people will make individually or collectively, but they do need the ability, as Hayek said, to plan their futures without concern for arbitrary coercion by another or others. In other words, people would not be bullied and would not have the rules changed on them.

Funnily enough, children in the playground, including at partnership schools kura hourua, are aware of this. They know it’s not fair to change the rules mid-game, but what this legislation is doing by making partnership school contracts illegal while they still have several years to go—some of them go through to 2023, 2024—is violating the rules that Hayek outlined, that most of the legal profession agreed with, and that children in the playground understand: that it is wrong to arbitrarily change the law and screw up people’s plans. I could go on—[Time expired]

Hon NIKKI KAYE (National—Auckland Central): I seek leave to table a press release that has gone out in the last four minutes by Sir Toby Curtis, entitled “Urgency sought for hearing to address Māori being prejudiced by the Crown’s destruction of Kura Hourua Partnership Schools”.

CHAIRPERSON (Adrian Rurawhe): Leave is sought for that purpose. Is there any objection? There is objection.

Hon NIKKI KAYE (National—Auckland Central): I raise a point of order, Mr Chairperson. This is an extraordinary situation and I would like the time of the committee to be able to read this press release that has gone four minutes—

CHAIRPERSON (Adrian Rurawhe): No. Order! I’ve put the leave. The committee has not accepted it.

Hon Nikki Kaye: But it’s a separate point of order.

CHAIRPERSON (Adrian Rurawhe): Yes, and I’m ruling on both of them. We’ve put the leave. The committee has not accepted that. As far as I’m concerned that’s the end of that matter. If the member has another point of order she can make it.

Hon NIKKI KAYE (National—Auckland Central): I raise a point of order, Mr Chairperson. So I accept that Labour members—I hope that it has not been Green members—have denied leave around me tabling the press release. Now I am asking the committee to have leave to be able to read out a statement by iwi leaders, which involves them putting an urgency application to the Waitangi Tribunal in the last 10 minutes.

CHAIRPERSON (Adrian Rurawhe): Leave is sought for that purpose. Is there any objection? Yes, there is objection.

SIMEON BROWN (National—Pakuranga): Thank you, Mr Chair, and I think we just need to take some time to reflect on what’s just happened. The iwi leaders have just put out a statement requesting urgency to the application to the Waitangi Tribunal. This Government continues to push this legislation through regardless of the fact that the iwi leaders have taken this application through and that there is potentially a claim which will need to be settled, and they are continuing their ideologically-driven decision to push this legislation through Parliament, which is going to shut down the partnership schools and destroy that model which has had a massive, incredible difference in some of our most disadvantaged communities.

I would have thought that members opposite, on the other side of this Chamber, would have had a little bit more heart, a little bit more kindness, and a little bit more aspiration for some of our most disadvantaged communities—the ones that they purport to represent, the ones that they are elected in many of their electorates, and what do they do? They come here and they ignore them. They come here and they ignore them and they have no compassion, no kindness, and no actual diligence to do their job as representatives of those communities.

So it’s a shame that we in this Chamber are going through this committee stage, where we are debating the issue of the title and commencement of this legislation. This is the most critical part that this Government could show some leadership on, in delaying the implementation of this legislation to allow for that Treaty of Waitangi tribunal claim to be heard and to be decided upon.

I have a Supplementary Order Paper which will give this Government some time to do that. The Minister sitting in the chair could take some notice and actually delay the implementation of this legislation until 1 August 2020, which is what I recommend in my Supplementary Order Paper, which would not only allow these partnership schools the time and the opportunity to be able to properly transition—not be shut down and then be made to reopen as a new model with very little time—but give them the opportunity to actually transition and then to actually be able to address some of these challenges. But it also allows for that Treaty claim to be heard.

But what do we see? We see silence from the other members of this committee. Not one member opposite has taken a call to explain what they are doing. I ask the Hon Peeni Henare to take a call. He represents the Auckland Māori seat Tāmaki Mākaurau, and I challenge him to stand up and take a call and talk about why he is not going to allow the Treaty of Waitangi tribunal claim to be heard urgently, why he is going to vote for this bill to go through quickly without that Treaty of Waitangi claim being settled first.

I challenge him to talk to his community and explain in this committee why he is going to make those schools close down before this legislation has been properly considered and before the Treaty of Waitangi tribunal has been able to conclude and hear the arguments. I challenge him to stand up and take a call, because I think of South Auckland Middle School. It’s a school which is in his electorate, a school which has made a massive difference in many of the young people that he represents, many of the young people who have been failing in the State school sector and whose lives have been turned around by that school.

I think of a family friend, Haimona, who has been a student at that school, who is one of the students there who has had his life turned around. He was going to James Cook college and his life was falling apart. He had the opportunity. His mother was someone who believed in her children, who wanted to see her son not go down the same path that the other children and other people she knew were going down. She had the opportunity to send her child to South Auckland Middle School, and that was the biggest decision she could make, and had the biggest difference in that young man’s life. I’m proud of where that young man is today. He succeeded at that school. He succeeded after that—going to Manurewa High School. He succeeded, and now he’s working for Air New Zealand and has a successful career ahead of him, all because of what South Auckland Middle School could do for that young man. The aspiration for that young man that that mother had and that school had turned his life around and changed his life, and he is one of the people who lives in that electorate of the member opposite, and I ask him to take a call.

Hon PEENI HENARE (Minister for the Community and Voluntary Sector): I move, That the question be now put.

CHAIRPERSON (Adrian Rurawhe): Members, relevancy is becoming an issue in my mind, but I will call the Hon Nikki Kaye.

Hon NIKKI KAYE (National—Auckland Central): Mr Chair, thank you very much for the opportunity. The reason why I want to read out this statement from iwi leaders is it is directly relevant to my Supplementary Order Paper (SOP) 120, and it does change my SOP, potentially, in the committee’s views, and I want to raise this issue with the committee.

In the last, sort of, 15 minutes, Sir Toby Curtis, but other iwi leaders, have issued this press release. The heading is “Urgency sought for hearing to address Maori being prejudiced by the Crown’s destruction of Kura Hourua Partnership Schools”. Again, the committee needs to remember that my SOP is arguing that these provisions should wait until consideration of the Wai 2770 claim. What the iwi leaders have done is they have watched what this Parliament is doing. They are watching us on TV. They have done that. They have realised this bill has now come to the House and it’s being pushed through. They don’t get informed by the Minister’s office, and they have gone and worked with their lawyers to—effectively, while we are debating this bill—file an urgency application in the Waitangi Tribunal. So all members should be taking a call and standing up, and it’s good to see the Minister of Justice in the chair, because I expect Andrew Little to make a statement, after I have spoken, about what involvement he may have had in the process around the consideration of Wai 2770.

So this is what they say: “Claimants Sir Toby Curtis, Dame Iritana … Dame Tariana Turia and Pem Bird have filed for their Treaty of Waitangi claim, Wai 2770, to be heard by the Waitangi Tribunal with urgency.” Again, my SOP was tabled before this action occurred, but it does strengthen the case for my SOP. This has only happened in the last 15 minutes. “Their claim, on behalf of themselves and Maori generally, takes issue with the acts and omissions of the Crown in respect of the closure of Partnership Schools | Kura Hourua. Notable Maori educator Sir Toby Curtis said ‘the state system has been failing our kids for 178 years, we finally get a schooling system that works for our young people and Minister Hipkins acts unilaterally,’ ”—that’s right, unilaterally—“ ‘without considering evidence of their success, and without consulting with our people, to destroy them. This Minister has resorted to bullying to have his way, and in so doing has disproportionately prejudiced Maori compared to non-Maori. From where we stand, [the] Government’s claims that the reduction of child poverty and the welfare of young people is a paramount focus lacks substance, in the face of Kura Hourua being closed they are empty claims. Educational success is key for our whanau who have aspirations for a better life for their children and who are seeking to escape deprivation and poverty. The State Education system might be working for a lot of people, but for the last 178 years it hasn’t addressed Maori and Pasifika educational under-achievement, which these Kura Hourua were’, he said. ‘[The] Minister has decided without consultation to close all 11 Kura Hourua by Christmas, while shortly after committing to extensive consultation around the review of Tomorrow’s Schools and NCEA. Minister Hipkins has acted in concert with the [teacher] Unions to treat Maori differently and decide unilaterally to close 11 schools that were achieving extraordinary results for our young people, that is inequity, pure and simple’, Sir Toby said.”

So my SOP stands. The question that I have—[Bell rung]

CHAIRPERSON (Adrian Rurawhe): David Seymour.

David Seymour: Thank you, Mr Chair, but could I just say I thought Nikki Kaye had a minute to go, but I’ll keep speaking in support of her in any case.

CHAIRPERSON (Adrian Rurawhe): My apologies.

David Seymour: Would it be OK to give her minute back, Mr Chair?

CHAIRPERSON (Adrian Rurawhe): Yeah, I apologise to the member. My vision of the clock was quite clearly incorrect. I should not have given the call to the member, but I will give it to him. I would encourage members not to jump up, because I should have looked at the clock, and members had risen to their feet.

Hon NIKKI KAYE: I raise a point of order, Mr Chairperson. I seek leave to have my minute of my previous speech.

CHAIRPERSON (Adrian Rurawhe): Yes.

Hon NIKKI KAYE: OK. So the point is that we have this SOP before the committee, and I plead with Labour and Green MPs. This is an issue of process. You’ve already terminated the contracts of all of these schools. All that these iwi leaders are asking for is due process here. They have watched Parliament. They have gone to the step of filing an urgency application in the Waitangi Tribunal. Why do we need to proceed today?

I would very happily stand up shortly and move a motion that we, effectively, halt this bill while we enable Ministers of the Crown like Andrew Little and like the Hon Chris Hipkins to consider this urgency application. That is the decent thing to do.

I am now looking at Gareth Hughes. Please, Gareth, understand that this urgency application has been lodged. You could stand up and take a point of order, recognise that urgency application, and, at the process level, please allow my SOP to go through. New Zealand First, wherever—there you are. Why can’t you consider these iwi leaders and the mana and respect that they have?

DAVID SEYMOUR (Leader—ACT): Thank you very much, Mr Chair, and for accommodating those circumstances that just arose.

Look, I’d just like to come back to the commencement clause and, again, the fact that it is almost immediate, and the contrast between that and the term of contracts. All of the Round 5 schools—you see, there were five rounds of partnership school authorisations—go through to 2023, if I remember rightly. Around four go through to 2022, and so on. The first partnership schools that were contracted back in 2014—their contracts only end at the end of 2020. So every partnership school is going to have its contract made illegal in the term that it was supposed to be valid. That’s quite aside from the fact that this legislation prejudices any possibility that those contractees to the Crown might have had in respect of renewal, because they were supposed to be six by six by six year contracts.

It goes to the heart of the theme that we’ve heard from Nikki Kaye—and I’ve mentioned it—about what it means to have a contract, what it means to have a partnership. It’s now being violated at two levels: one we’ve heard about, which is the contract between Queen Victoria and a number of iwi leaders back in 1840—widely known as the Treaty of Waitangi—but the other one is the contract between the Crown and a number of sponsors of partnership school kura hourua, which we call partnership school contracts.

I developed a little bit, in my last speech, why the ability to carry out your actions and make choices without concern for arbitrary coercion by another or others, as Friedrich Hayek I think very eloquently put it, is so important to the prosperity of our society. It’s not just people who are in partnership schools who might be concerned about the Government legislating away a contract. This is actually much bigger than a Treaty issue. It’s bigger than a partnership school issue, an education issue; it goes to the heart of whether people in New Zealand can trust Parliament and whether they can trust the Crown to do what they say they’re going to do. As I pointed out, even school kids playing pick-up games at lunchtime intuitively get it: that it’s not fair to change the rules halfway through the game just because it suits the people in power.

Now, if schools kids can work this out, then I wonder whether the Labour Party caucus can work it out, because so far in this debate they’ve made two contributions. I was very excited when Peeni Henare stood up to his feet—as I always am, but particularly in this circumstance—and I thought he was going to give a speech. And he said, “I move that the question be now put.” Now, he may have read the Standing Orders and understand that technically that is a speech, but I think he is capable of saying a lot more than that. He’s capable, but the question is, will he? Does he have the gumption to stand up and say, “Actually, I think my party’s wrong. I think the Treaty is more important than anything we’ve discussed in caucus. It’s part of my soul and the reason I’m here, and I’m going to cross the floor on this.” That’s the question. Will he or Kiritapu Allan stand up and say, “I move that the question be now put.”?

CHAIRPERSON (Poto Williams): Order! Order! Come on; let’s get to the substance of the debate, please.

DAVID SEYMOUR: Absolutely, because if they were to do that, then they would be upholding the basic principle that in the Treaty of Waitangi, in partnership school contracts and in a whole lot of other contracts with the Crown, people can trust that the Government will do what it says it’s going to do.

And this applies to people who contract to the Crown in the welfare provision space. It applies to people who have commercial contracts to build infrastructure. It applies to anybody doing business with the Crown of New Zealand. If we have this particular commencement date that makes contracts with the Crown illegal before they end, then that is taking this whole country to a very dark place indeed.

NICOLA WILLIS (National): I rise to make comments on a range of matters relating to both the title and the commencement of this bill. In doing so, I want to first respond to some comments by the Minister of Education, who, in referencing the debate around whether or not this bill’s commencement should be paused until the Waitangi claim has been heard, said that it was not appropriate for him to comment on a claim before the Waitangi Tribunal. I would contrast that with what he thinks is appropriate, which is that he believes it’s appropriate to progress a piece of legislation that is subject to that very claim.

He thinks it is appropriate to move through the House a bill which will commence as soon as the Royal assent is given and which will, at that point, contravene the wishes of those making the claim. So it is very precious, I think, of the Minister to say that, oh no, he can’t make any comments but that, yes, he can act in a way that so clearly defies the wishes of the claimants in this case, particularly because what we are debating here in this clause is simply that this should be delayed—that the commencement shouldn’t occur until the claim has been heard. The application has been put in for urgency, it would be possible for this claim to be heard quickly, and it is appropriate, therefore, to consider that this bill should not come into effect for partnership schools until a later date.

The second point that I want to make—having canvassed that point, which has been well-canvassed by previous speakers—is this question of when, in fact, this legislation should come into effect, because, of course, it does have a number of other provisions relating in particular to polytechnics and universities and to national standards at primary and secondary schools. In relation to a number of those sections, there are very detailed transitional arrangements in the bill.

So it is always relevant when we’re looking at the commencement of a bill to question whether the commencement is the right commencement date, given the huge breadth of transitional arrangements that will be triggered at that point, because those transitional arrangements take significant effort of implementation for all of those involved. I am talking about the mums and dads sitting around school boards of trustees who, the minute that this commences—which, if we are to believe the Minister, will be the minute that this bill is given the Royal assent—will then be required not only to get their heads around what this new piece of legislation means for them and their schools but to get their heads around the transitional arrangements that will occur prior to the specific clauses coming into effect for universities, polytechnics, and councils. This means distracting themselves from the business of how to improve the rankings of our universities in international eyes and distracting themselves from the business of the pastoral care of their students in order to look at the transitional arrangements that need to be put in place.

The third point that I want to make is around this question of extensive consultation, because the Minister, in briefly mentioning the title and commencement, was clear that he believed that extensive consultation had taken place on each of the matters here. I want to contrast that and suggest that this is yet another reason why the commencement of this bill should be delayed, because we look at the Tomorrow’s Schools review which is currently under way—and which has been under way for many months—we look at the review of the education system in general, and we look at the strategic review of early childhood education. All of these reviews have been going for a number of months, and their report-backs have been delayed because the Minister is of the view that there is sufficient view in the community that needs to be heard and that it is not time yet for him to report. So, given the level of debate that we have had about these partnership schools’ clauses and given the statement today by Waitangi leaders in relation to their claim, would that not suggest that more consultation is required and that this commencement date is inappropriate? I would put it to you that it would.

I want to briefly mention an amendment in my own name. That is an amendment that would change the title of this bill. The title of this bill is particularly lacking in imagination and particularly lacking in any sense of vision or an idea for the future. It is simply the “Education Amendment Bill”—very dull indeed—and I think it speaks to the fact that the Minister doesn’t actually have a central governing idea or vision for what he will do for our students. There isn’t a concept of progress or achievement that he’s able to put in lights in his title to the bill, and I’d suggest to him that the prosaic title of “Education (University and Polytechnic Council) Amendment Act”, as suggested by my amendment, would quite properly describe the contents of this bill.

Dr DUNCAN WEBB (Labour—Christchurch Central): I move, That the question be now put.

A party vote was called for on the question, That the question be now put.

Ayes 64

New Zealand Labour 46; New Zealand First 9; Green Party 8; ACT New Zealand 1.

Noes 55

New Zealand National 55.

Motion agreed to.

The result corrected after originally being announced as Ayes 63, Noes 56.

The question was put that the following amendment in the name of Denise Lee to clause 1 be agreed to:

replace “Education Amendment Act” with “Education (Abolition of National Standards) Amendment Act”.

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

Ayes 56

New Zealand National 55; ACT New Zealand 1.

Noes 63

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

Amendment not agreed to.

The question was put that the following amendment in the name of Erica Stanford to clause 1 be agreed to:

replace “Education Amendment Act” with “Education (Abolition of Partnership School Kura Hourua) Amendment Act”.

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

Ayes 56

New Zealand National 55; ACT New Zealand 1.

Noes 63

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

Amendment not agreed to.

The question was put that the following amendment in the name of Nicola Willis to clause 1 be agreed to:

replace “Education Amendment Act” with “Education (University and Polytechnic Council) Amendment Act”.

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

Ayes 56

New Zealand National 55; ACT New Zealand 1.

Noes 63

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

Amendment not agreed to.

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

Ayes 63

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

Noes 56

New Zealand National 55; ACT New Zealand 1.

Clause 1 agreed to.

The question was put that the amendment set out on Supplementary Order Paper 120 in the name of the Hon Nikki Kaye to clause 2 be agreed to.

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

Ayes 56

New Zealand National 55; ACT New Zealand 1.

Noes 63

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

Amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 119 in the name of Simeon Brown to clause 2 be agreed to.

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

Ayes 56

New Zealand National 55; ACT New Zealand 1.

Noes 63

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

Amendment not agreed to.

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

Ayes 63

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

Noes 56

New Zealand National 55; ACT New Zealand 1.

Clause 2 agreed to.

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

Ayes 63

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

Noes 56

New Zealand National 55; ACT New Zealand 1.

Clause 3 agreed to.

House resumed.

Bill reported without amendment.

Report adopted.

Bills

Criminal Cases Review Commission Bill

First Reading

Hon ANDREW LITTLE (Minister of Justice): I move, That the Criminal Cases Review Commission Bill be now read a first time. I nominate the Justice Committee to consider this bill.

Miscarriages of justice unjustly deprive individuals of their freedom and undermine public confidence in the justice system. It’s therefore vital that we have robust mechanisms to identify and remedy miscarriages of justice where they occur. This bill advances those objectives by establishing a criminal cases review commission.

Currently, a person who believes they’ve suffered a miscarriage of justice may apply to the Governor-General for the exercise of the royal prerogative of mercy. By convention, the Governor-General acts on the formal advice of the Minister of Justice. Work on the prerogative of mercy applications is undertaken by lawyers in the Ministry of Justice’s office of legal counsel, and assistance is sought, where required, from an independent adviser such as Queen’s Counsel or a retired judge.

This process has, in many ways, served us well. However, for some time, experts and members of the wider public have had concerns about our systems for identifying and remedying miscarriages of justice. The concerns expressed have principally related to the independence, timeliness, quality, and fairness of investigations into miscarriages of justice under the status quo. Further, as Sir Thomas Thorp highlighted more than a decade ago, our current system does not adequately encourage applications from Māori or Pacific peoples. As we know, Māori and Pacific peoples are imprisoned disproportionately, making up some 60 percent of our current prison population, yet the rates of applications for the royal prerogative of mercy from these populations is estimated at somewhere between 11 and 16 percent.

Other jurisdictions have grappled with similar concerns and have, in response, established criminal cases review commissions. The experience of these overseas bodies, while not without difficulty, suggests that establishing a criminal cases review commission may significantly enhance the process of identifying possible miscarriages of justice.

The Criminal Cases Review Commission will be a new, independent Crown entity with between three and seven commissioners, including a chief and a deputy chief commissioner. The independent Crown entity model will enable the Criminal Cases Review Commission to operate within a coherent, well-established framework that is sufficiently independent of Ministers, the courts, and relevant State sector organisations. At least one-third of the commissioners will be legally qualified, and at least two-thirds will have a background in the criminal justice system. The appointment of commissioners will also take into consideration the desirability of diversity and an understanding of Te Ao Māori in particular. This membership composition will enable the commission to have the necessary mix of skills and experience for its decision making and governance, while avoiding the risk of ongoing expansion of membership beyond what may be necessary.

The primary function of the commission will be to review convictions and sentences and decide whether to refer them to the Court of Appeal. The courts remain the body that determine a person’s guilt or innocence. The way this operates is that the judiciary decides guilt and sentences accordingly, and it must be the judiciary that, ultimately, undoes the decision if it is found to be erroneous. The commission will be able to receive applications from any living convicted person or their representative. The commission is also able, where it is in the public interest, to make initial inquiries on its own initiative, though it must seek the consent of the individual concerned to proceed to a full investigation.

Investigations will be thorough and will involve, for example, examining large quantities of relevant files, interviewing applicants or witnesses, and, very commonly, forensic testing or instruction of experts. This role will help to remove some of the burden that currently rests on applicants. If, in investigating a case, the commission finds evidence of a matter that may be causing or contributing to miscarriages of justice, it will be able to launch a thematic inquiry into these issues. One issue commonly raised currently is the use of jailhouse witnesses in relation to purported confession evidence, and that may be something that is the subject of a thematic inquiry at some point in the future.

The result of the commission’s work will be a report to the Minister of Justice, who will be required to present that report to Parliament as soon as practicable after receiving it. The intent of this power is to add a quasi-preventive function to the commission’s work. The commission also has a duty to promote public awareness of its functions. I see this as an important element in signalling to the commission the need to engage with potential applicants, especially Māori and Pacific peoples, in order to encourage meritorious applications.

Arguably, the most important and complex aspect of the design of the commission is the test for referring a case back to the courts for a fresh appeal. Clause 17 of the bill provides that the commission can refer a conviction or a sentence to the Court of Appeal if it considers referral is in the interests of justice. In deciding whether to refer, the commission must have regard to a number of points: firstly, whether the convicted person has already exercised their rights to appeal against conviction or sentence; secondly, the extent to which the application relates to argument, evidence, information, or a question of law previously raised or dealt with in the proceedings relating to the conviction or sentence; thirdly, the prospects of the court allowing the appeal; and, finally, any other matter that the commission might consider relevant.

The experts we’ve consulted in developing the test have, unsurprisingly, had a variety of views on this construction. Many believe the test strikes the right balance, providing the necessary flexibility while clearly signalling the relevant considerations involved in making a referral. However, others were concerned that the test is overly prescriptive and that the use of factors as listed may be interpreted in a manner that has a chilling effect on referrals. In my view, the test strikes an appropriate balance. It has been specifically designed for the New Zealand context. In the interests of justice, it provides a broad discretion to refer, while the factors that the commission must have regard to acknowledge important constitutional principles. The existence or non-existence of one factor is not in itself determinative of the application. I anticipate—and I welcome—comment on this aspect of the bill, and I will gladly consider any improvements that can be made so that the commission may effectively carry out its core function.

Similarly, I expect the commission’s information-gathering powers will be of particular interest to submitters and to the committee in its deliberations. The bill makes it clear that consent and cooperation should always be the preferred means of seeking information, but allows the commission to compel information from public entities and private individuals where necessary. Where a person has failed to provide information, the bill includes a civil enforcement process in the District Court. The drafting of the information-gathering powers attempts to strike a careful balance between the need for the commission to access all relevant information and to safeguard the rights and freedoms of individuals and relevant protections for privilege and confidentiality.

I note in particular that the bill expressly provides that the commission cannot access information that is protected by existing privileges or confidentiality. This is an important difference from commissions overseas, which are able to access information even if it is privileged. The scope of the information-gathering powers, including whether or not to allow the commission to access privileged information, will be important for the committee to consider, and I look forward to their conclusions in this respect.

Another important aspect of the bill is how it interacts with the royal prerogative of mercy. The effect of the bill is that the Governor-General will no longer play a role in referring cases back to the courts. However, as the royal prerogative of mercy remains in force, the bill recognises that the Governor-General will continue to have the power to, for example, grant a free pardon. The bill provides that where the exercise of the royal prerogative of mercy is being considered, the Minister of Justice, as the Governor-General’s adviser, may request the commission’s opinion on any matter relevant to the case.

This bill meets an important Government commitment, responds to long-held concerns from a variety of New Zealanders, and will dramatically improve our system for responding to miscarriages of justice. It will create an important safety valve that is presently missing from our system. In closing, I note the finding of the United Kingdom’s House of Commons Justice Committee in assessing the work of the Criminal Cases Review Commission there, that, “If a bolder approach leads to five more failed appeals but one additional miscarriage being corrected, then that is of clear benefit.” I agree with that sentiment, and I believe that this bill will enable us to achieve such a benefit. I commend this bill to the House.

CHRIS PENK (National—Helensville): Thank you, Madam Assistant Speaker, for the opportunity to lead the contribution to the debate on this side of the House. I acknowledge, first, the laudable intention of the Government and Minister Little, who’s just given an introduction to the intent of the Criminal Cases Review Commission Bill, and indeed some of its operation.

Minimising miscarriages of justice—it almost goes without saying—is indeed a laudable intention. I use the word “minimising” in deliberately broad terms because a couple of options are presented to us as policy makers—one being to prevent as many as possible from occurring in the first instance, and then, second, how to deal with the prospect that there might have been miscarriages of justice that have taken place. Of course it goes without saying, again, that both of those aims should be taken into account by policy makers, but I would like to place on record that we believe that it may be fruitful, if reform is required in this space regarding the possibility of miscarriages of justice, to do everything that is possible to reduce the possibility that they take place in the first instance.

That acknowledged, I’d like to go on to structure some remarks around a couple of different themes—one being matters of constitution and the other being matters of construction. On this side of the House we have some concerns with the relationship of the respective branches of Government—executive, legislature and judiciary, although not particularly the legislature in this part—and the way that those interact and how those would be affected by the operation of this bill if it is passed into law. As for matters of construction, there’ll be some particular matters that we’d like to highlight and hope that these will be taken on board by the Government through the legislative process, assuming that it does pass the reading and beyond.

We will be speaking—I hope and expect—on a number of a different aspects of the bill. I’ll just summarise those briefly before going into a bit more detail on a couple in particular. We’ll be talking about the features of the commission, as advertised in the bill itself, and some pros and cons of those as we see them, also the question of discretion, the membership of the commission, the possibility of introducing delays into our justice system—I note that it seems to be a matter that is generally accepted as true that there are already unacceptable delays in our court system and in our justice system more generally—expense, the possibility of floodgates opening, the prospect of duplication, and the establishment of another Government agency, which is not a step that should be taken lightly. Others are consideration of the standard required for referral, and I do acknowledge that the Minister has already made some comments on that, and those are duly noted and understood—there is possibility that a lack of accountability will arise from this mechanism. Again this is perhaps in comparison, particularly, with the current arrangements whereby the Minister himself or herself has something of a role. There is the place of victims too, and their voice within this process as having been established is something we’re also keen to discuss, along with the particular investigative powers and the ways that the bill would operate in practice through the commission itself, of course.

So without going into those in more detail in the hope and expectation that others on this side of the House and perhaps others too on the other side of the House will comment on those, I’d like to turn more particularly to examining the features of the commission as set out by the bill itself in the explanatory note. First, it is to “receive applications from eligible persons or their authorised representatives”. “Eligible persons” are defined—again, I acknowledge the Minister has made this point—as living persons who have been convicted, they feel, unjustly, or indeed their representatives, but not on the other hand by those who feel as though a miscarriage of justice may have taken place. It is the other way round, so to speak, so that if a miscarriage of justice has occurred such that a person has not been convicted in circumstances that they would have. So I just note for the record something of a lack of balance in that regard.

Second, the element of promotion of its own activities in relation to the functions of the commission: that will be something that the commission is mandated to do. It is appropriate, of course, that its functions be known, so that those who might be able to take advantage of it have the opportunity and the ability to do so—an aspect of the access to justice element of our rule of law. But I wonder if more thought could be given to improving the ability for members of the public, in particular those to whom it might apply, to actually know what the current arrangements are. So if phrases such as the “Royal prerogative of mercy” are somewhat inaccessible to those who might be in a situation of having suffered a miscarriage of justice, then perhaps some thought should be given to that in relation to particular ethnic groups that the Minister has mentioned, who are not availing themselves of that opportunity as it currently already exists.

The undertaking of thematic inquiries in relation to miscarriages of justice in general: again, laudable in intent but I wonder if that’s not already a function of other parts of the executive, and indeed the legislature. There is nothing to stop this House, or indeed, including via select committees and so forth, and the Minister of Justice and the Law Commission and various other bodies—Government and non-government agencies and entities alike—making such inquiries, so I wonder what the relationship of the commission will be in relation to those.

The powers to obtain information are quite intriguing. I do fear that not enough thought has been given to how these will play out. The Minister has mentioned the question of privilege; he’s not mentioned, however—and I hope I am incorrect in saying—that the question of contempt of court is not raised in the bill. I don’t know if standard judicial functions will apply to this body, which is judicial in nature—at least to some extent. It does have the ability to review and it does have the ability to refer, albeit not ultimately to decide. So that’s something that I would encourage the Minister to consider as at least a matter to clarify one way or the other in terms of whether such standard aspects of criminal procedure will apply to the operation of the commission.

I’d like to move now in my remaining time to a couple of other points. One is, perhaps, a matter of drafting more so than policy intent, but it is none the less extremely important. At clause 17(1) of the bill we hear that, “The Commission may refer a conviction or sentence to the appeal court if the Commission, after reviewing the conviction or sentence, considers that it is in the interests of justice to do so.” I think I understand the intention, which is to establish, effectively, a set of criteria such that referrals will be made, but the word “may” after the word “commission”, saying that the commission merely may refer a conviction or sentence in those circumstances seems to me the wrong word. Surely if the commission, having reviewed the conviction or sentence, does consider that it is in the interests of justice to do so, then it shall or must refer such a conviction or sentence to the appeal court. Such is my view, and on this side of the House—and, again, I would encourage and request that the Minister and his team take a close look at that aspect. No doubt there will be other opportunities to thrash out particular details of the bill, but that’s one that did strike me as rather significant at this early stage.

My final comments relate to the membership of the commission. I’ll just note reasonably briefly that the qualifications of the commission perhaps are intended to strike a balance between those who are legally qualified, as that term is defined, and those who are not, but I will be making some suggestions—perhaps not in my remaining minute, but perhaps through other means—by way of suggestion about how that could be tightened up a lot more to ensure that we actually have robust processes that reflect the very real needs of those who are engaged in the criminal justice system—not only those who believe that they have suffered a miscarriage of justice in the sense of being criminals but also those who are affected directly in terms of victims and, of course, the State and the people of New Zealand as a whole.

Criminal law, by definition, involves us all—at least at a theoretical level, and less involved than those who are, sadly, in the thick of it—but with these comments I’ll bring my contribution to a close. But, as I say, I hope that the contributions on this side of the House along the lines of constitutional matters, and also matters of construction of the bill, will give pause for thought for the Minister on the other side of the House in proposing a bill that we see as somewhat flawed in terms of the way it interacts with the current system and as to specifics as well.

Hon AUPITO WILLIAM SIO (Associate Minister of Justice): Teina Pora is a case that many of us in South Auckland are familiar with. Here, a young man who was charged with rape and murder spent 20 years in jail, and then finally that conviction was quashed after a couple of people spent the entirety of their careers finding out the truth, getting the information out, until it was finally recognised that a miscarriage of justice had been carried out.

That is only one example of why an independent criminal cases review commission is required. Too often, I hear from others who say that access to justice is about sending criminals to prison. The reality is that access to justice is about doing the right thing: making sure that the people that we are charging with offences or criminal behaviour do get charged. We spend an awfully significant amount of money making sure that offenders are convicted, but we don’t spend equally enough energy and resources making sure that justice has been done.

I want to point out to this House why I am supporting this particular bill and supporting what the Minister of Justice is doing, because there are a number of people who have been identified, particularly people who do not have the means to be able to embark on a particular appeal where they feel that the wrong thing has been done. So I’m supportive of this.

I note that the association of the legal fraternity also welcome this, and there are many in the legal fraternity who have been advocating for such a commission. It needs to be independent. I note also the recommendation of having three to seven members sitting on this review commission. I also acknowledge that there is a line of thought that there should be more than three, and a tendency to look towards having a membership of seven. I’m keen to understand better from the general public and those who are in the legal fraternity to know what the arguments are for that.

I’m of the view, also, that if we are concerned about Māori and Pasifika, people who are categorised as those who do not have the economic means to embark on a particular appeal where they believe injustice has been committed, then those people—who may not necessarily have a legal background, but who are our peers in society—should also be part of this commission. But I would be keen to hear what the public have to say about the make-up of that particular commission.

So when we talk about access to justice, it also means making sure that the timeliness, the quality, fairness, and independence of our current system is upheld. Therefore, I believe that setting up this Criminal Cases Review Commission Bill not only achieves what this particular Government is prioritising, but I think it will achieve what many in society generally want to see, and that is that when we send somebody to jail, we all need to be confident that justice has been done.

I want to conclude by making reference again to Teina Pora. The artists of South Auckland—musicians—developed a video that was played and circulated and promoted because—and it revealed also just the appalling view that’s held by many people who don’t have the means to hire a judge for themselves. A lawyer, sorry—a lawyer for themselves. Ha! Ha!

SPEAKER: I think that’s a—I note the correction!

Hon AUPITO WILLIAM SIO: Yes. They were appalled that it took 20 years for full and complete information to be made available, and once that full and complete body of evidence was made available, they were able to quash the convictions of this young person here. The fear amongst the low-income—the fear amongst these artists in South Auckland—was that if they could do it to one of ours, they could do it to the rest of us, which meant that there’s a perception out there that if you don’t have money, you’re not going to get justice. Therefore, I think this Criminal Cases Review Commission goes towards eliminating that fear and reaffirming, once again, that justice is for all, including people in this House. Thank you.

Hon Dr NICK SMITH (National—Nelson): One of the most important areas of legislation for Parliament is in the area of criminal justice and ensuring that we meet the objective of where people cause harm and commit criminal offences, they are held responsible, serve appropriate penalties for those, but equally that our society respects innocence and respects those long-established principles of law in ensuring people get a fair trial. So it is timely with this bill that Parliament debates these core issues about how we improve and eliminate imperfections in our criminal justice system.

Now, where I would differ a little in emphasis from the previous speaker and Government Minister, the Hon Aupito William Sio, is that as important as it is that we ensure that no innocent person is locked up, equally important for members on this side of the House is that our communities are safe and that where people commit crimes, they’re held accountable and that the community is kept safe from them. So as we debate this bill, let us be open and transparent about that real balance that we have to strike in terms of our criminal justice system.

I would also want Parliament to be realistic about that old saying “Bad examples make for bad law.” If I reflect, for instance, on one of the very good justice Ministers, and an interesting Prime Minister, David Lange, in his valedictory speech, he said that he had so often seen Parliament chasing after bad examples and passing bad law as a consequence of those. While you can quote examples—of course there will be—where our criminal justice system failed, I’d urge the Government and Parliament, as it considers this bill, not to fall into that trap of bad examples making for bad law.

Now, the previous speaker also quoted the example of Teina Pora and the injustice that he suffered and the process that has been followed through the exercise of the Governor-General’s prerogative of mercy to resolve that issue. We on this side of the House need to be satisfied that this new Criminal Cases Review Commission is actually going to be able to more effectively deal with that sort of case of injustice than the process that exists under our current law. Let’s, firstly, focus on ensuring that before we create a fourth tier of judicial process for dealing with difficult cases, we make the first three tiers work—that is, where there is a case of murder or significant criminal offending, we provide for a High Court trial, we provide for a Court of Appeal, and we provide for the Supreme Court.

So before we simply jump to the easy conclusion of adding a fourth process through the Criminal Cases Review Commission, Parliament should be focused on making sure that those first three steps are as robust, as fair, in delivering justice as possible. So, for instance, if there are issues with our legal aid system, if there are issues around our evidence law, if there are issues to try and get as many cases right as early as possible, this is, firstly, where National would wish to go.

Some of the concerns that National has in respect of this bill are, firstly, the very low threshold for taking a case to the Criminal Cases Review Commission. While any judicial system will be imperfect and will not get every case right, the truth is that our justice system deals with tens of thousands of cases every single year, and if we’re going to open up with a very low threshold and an additional area of appeal under this bill, in my view there needs to be a high-level threshold for cases being able to get to that point that exists currently under our Crimes Act under the exercise of the royal prerogative of mercy. This is a far wider gate, and is, effectively, adding a fourth level of appeal for criminal cases in New Zealand.

I further want to raise concerns about the make-up of the commission. It is National’s view that if you are to add this extra tier, we need to be absolutely sure that there is a high level of legal expertise going into any fourth-level appeal. What is provided here in this bill is that two-thirds of the members of the commission can have no legal training at all. If we really are intent on improving the quality of the judicial system and the decisions that come out of our courts, we would want to be sure that there is the highest level of judicial expertise, of legal skills, going in to ensure that those decisions are indeed correct.

We also would note that this bill is going to provide for a cost of about two and a half million dollars to establish the commission, and an extra cost of $4 million per year. Now, we are, on this side of the House, keen to know, actually: is that a better response? The simplistic response of “Oh, we’re prepared to pay anything to ensure our justice system”—actually, we need to spend the money where we’re going to get the very best of improvements, and we have a question mark about that, and particularly in respect of the low threshold for cases being able to be taken to the Criminal Cases Review Commission.

The last point I would want to make is that in these really difficult cases, and we can all think of the Arthur Allan Thomases or the David Bains or the Scott Watsons or the Mark Lundys, or the Ewen Macdonalds, and we can think of all those examples, when there is an injustice, is the more flexible mechanism—and there have been a number of commissions of inquiry that Cabinet and the Government can initiate, where there are very specific terms of reference that are able to focus on the particular aspects. Here’s the truth: if, having gone through the High Court, the Court of Appeal, and the Supreme Court, the judicial system has still not got it right, then that actually asks questions about the effectiveness of those three steps in the justice system.

Now, the gain we’ve got at the moment of the more flexible approach of the Government being able to have a commission of inquiry, that’s occurred in a number of those controversial cases, is that you’re actually able not just to resolve the issue of the injustice that may have occurred for the individual, but to scrutinise the systematic error that’s occurred within the justice system and provide a mechanism by which that can be improved. I’ll make a bet for this Parliament: even if we proceed with the establishment of the Criminal Cases Review Commission, there will still be examples in our justice system where there are failures and there will be commissions of inquiry and the exercise of justice in the provision of the prerogative of mercy being exercised.

So my challenge for the Government as this bill progresses before the House is that National wants to be satisfied that we are first making sure that the first three steps of our justice system are working properly, and that our principal focus should be on ensuring that those issues are resolved. Secondly, if we are going to spend many more millions of dollars in creating a permanent, effective fourth level of appeal for these criminal cases, we need to be satisfied that we are improving the quality of justice, and we are going to take some convincing, particularly with the low thresholds, particularly with the lack of legal skills on this new commission, that we indeed are going to improve the quality and the effectiveness of New Zealand’s important justice system.

SPEAKER: Before I call Darroch Ball, I’ve had quite a few complaints about visual pollution in the House from all sides, with the named boxes. The rules are very clear, and that is that members who are in the Chamber are allowed one—thank you, Mr Ngaro; can you take one of yours down? Thank you.

DARROCH BALL (NZ First): Thank you, Mr Speaker. It’s a pleasure to rise on behalf of New Zealand First to speak on the Criminal Cases Review Commission Bill and in obvious support of it. It’s part of the commitment of the coalition agreement of this highly successful coalition Government. I would just like to make a few quick points that I’d like to highlight, but before I do I’d just like to thank the Minister for bringing the bill to the House. In his speech, he actually outlined, in quite a lot of good detail, how the commission would work, why it would work, the progress of the bill going forward, and the entity itself.

New Zealand First has actually campaigned on the need for this entity for quite a number of years—at least for the last two elections that I’ve been involved in—but I think it’s quite important to note that this isn’t actually a reinvention of the wheel that we are trying to achieve here. This sort of independent entity is established in several jurisdictions around the world, including the United Kingdom, Scotland, and Norway, and they provide some very good examples for us about the strength and the need in the basis for an independent sort of commission that we are wanting to achieve here in New Zealand through this legislation.

The main reasoning behind why we are pushing for this commission, I think, is quite obvious. We’ve heard from both sides of the House already about the number of cases in recent years, and quite high-profile cases, of miscarriages of justice. I think the point is that often those who are convicted feel that there are quite severe miscarriages of justice, and, unfortunately, it is just a reality that they do occur. What we need to do is try to minimise those and have, I think, most importantly with this commission, those people who are convicted not having to have ad hoc associations of their supporters brought together and trying to raise funds to try and correct something that is wrong in the justice system, and instead have a process that doesn’t rely on just how much fuss they can make about it and how much money they can raise. This is one way of doing that, and we can learn from overseas jurisdictions, as I have noted previously, where it works.

It’s important to note and for people to understand that the primary stakeholders within this jurisdiction were consulted with. There are a number of them, but they range from the convicted individuals themselves, the Governor-General, police, academics, lawyers, and the public themselves. The justice officials undertook targeted consultation with the investigative bodies, being the Independent Police Conduct Authority, the Office of the Privacy Commissioner, and the Inspector-General of Intelligence and Security, and all of their comments were positive and in support of the establishment of this independent commission.

New Zealand First is obviously pleased that this bill is going through the House as part of the coalition agreement. We fully support it, and I commend this bill to the House.

Hon MARK MITCHELL (National—Rodney): I’m very happy to stand and take a call on the Criminal Cases Review Commission Bill. I just want to address very quickly the last comment that the last speaker, Darroch Ball, made around the consultation that was done. It has actually been very broad. I think that, in principle, all of those groups would actually agree that if we could see a mechanism put in place that is likely to prevent or stop miscarriages of justice inside our justice system, that would be a good thing to do. The only concern I have is that the one group that’s missing—and it seems to be a trend that is developing in the debates we have in this House around our criminal justice system—is victims and how this process is going to fit alongside them and what sort of voice they are going to have.

One of the big concerns that I have with the legislation is the application of the Official Information Act (OIA) 1982 and the fact that the commission is going to be exempt from anyone being able to make an OIA application to actually get visibility on the communication that is happening between the commission and anyone that they’re engaging with. I think that that is a poor step in the wrong direction in terms of having at least some transparency around how the commission is working and what they’re doing. I think the reason why this is so important is that if you look at the proposed make-up of the commission, you are going to have commissioners sitting on there—and, of course, they can range anywhere from three through to seven. If, for example, we did take the scenario where there are three commissioners appointed, and one or two of those had no legal background, then you’ve now got a commission with extraordinarily wide-ranging powers that are not subject to the OIA and they’re going to be making decisions on cases inside our criminal justice system.

These are important points. These are points that I want to raise. I would invite the members opposite to take a call on this and, if I’m wrong, point out to me where I’m going wrong and give us some confidence that we’re not going to create a situation whereby we’ve got a commission with extraordinary powers that is making decisions on our judicial system with people who don’t necessarily have a legal background or the proper training or background to be able to do that. At the same time, the people of New Zealand are not going to be able to get visibility on what’s actually happening, because the commission is exempt from the Official Information Act. I think these are important questions that need to be answered. The fact of the matter is—and I’ll come back again to the comments that were made by the New Zealand First member who spoke before I did—that if you’re going to set up a commission like this and they’re going to investigate possible miscarriages of justice, which is very important, you can almost guarantee that behind every crime there are victims and there are stakeholders and people who have an interest in it, and they should be entitled to have a clear understanding of what is happening and what is going on inside of that review.

The other thing that I am very worried about—and the Hon Dr Nick Smith raised it—is the thresholds involved. In my view, this commission, if it’s established, is going to be swamped very, very quickly with a lot of applications from a lot of people who have been convicted of something and feel aggrieved and feel like there’s been a miscarriage of justice. So I’d like someone to take a call on this and explain to us in this House how that process is going to work before we have a commission that is going to cost $2.3 million annually to run and is going to be so bogged down with its own workload that what’s going to happen is it’s actually going to slow down justice for everyone. It’s going to create blockages in the system, because part of it isn’t going to be able to actually process and deal with cases that are brought to it to be reviewed. So I think that this is actually a really important, critical, part of the bill. Explain to us what the criteria are going to be. Is it going to be people who have faced minor charges under the Summary Offences Act? Is it going to be only for people who have been charged with serious offences with prison terms of two years or more under the Crimes Act? This is going to be critically important to how this commission is going to function.

So these, really, are the two main issues that I wanted to raise in the House today. I would ask the next Government member that takes a call on this bill to just talk us through the issues that I’ve highlighted, so that we could at least have some comfort and start working through this bill to see whether or not we land in a place where we think that it’s actually going to add something and it’s going to bring some added benefit to our criminal justice system and how we deal with miscarriages of justice. Although we’ve got one of the best criminal justice systems in the world—without a doubt—it is not perfect. Anything to do with human beings will never be perfect. There are going to be mistakes made, without a doubt.

But, please, someone take a call and address the issues that I’ve raised and show us clearly, demonstrate clearly, how the Criminal Cases Review Commission Bill is actually going to make our criminal justice better, safer, and isn’t actually going to clog it up and isn’t actually going to create a body that (1) has not got the expertise in it to be able to start making these decisions and (2) why there’s not going to be transparency around it—why they’re not going to be subject to the Official Information Act. Thank you very much, Mr Speaker.

GOLRIZ GHAHRAMAN (Green): Thank you, Mr Speaker. It’s exciting for me to rise to speak in support of the creation of the Criminal Cases Review Commission today. I advocated for this as part of my role on the executive of the Criminal Bar Association of New Zealand for some years, as we watched the fairness of our justice system decline under the types of cuts that were implemented by the previous Government. I think most people in New Zealand would be shocked to find that there is actually a Court of Appeal judgment ruling our legal aid system unlawful for the damage that it was doing to access to justice in New Zealand. That was under the National Party Minister the Hon Judith Collins. I was part of that case, and it was heartbreaking—

Hon Dr Nick Smith: What are you implying?

GOLRIZ GHAHRAMAN: —to watch a fair and free criminal justice system—what am I implying?

Hon Dr Nick Smith: Yeah.

GOLRIZ GHAHRAMAN: The Court of Appeal ruled the legal aid cuts unlawful; that it is hard to find fairness in a system where access to justice is only available for the rich. I’m not implying that; I’m saying it outright. The Court of Appeal found it, and the judgment stands. The judgment stands. So we’re trying to fix that. We’re trying to make justice available.

Part of the right to justice is the right to fair process. Most people know about the right to defence counsel, the right to fair and transparent proceedings, and the right to impartiality, but another aspect of that right is the right to appeal—appeal against unfair convictions and sentences. Part of the legal aid cuts that made our system of justice unfair was that the costs of an appeal were cut—I think they’re down to about $1,700.

Now, to bring an appeal, you have to have counsel that’s at least as senior as the trial counsel. That lawyer has to go through the transcripts of the trial, through the evidence that was disclosed before trial, look at possible new evidence—and Teina Pora’s case has been raised; that was complex new evidence—look at the possibility of new witnesses, and see if any unfairness occurred as the result of the conduct of either the sitting judge or the previous trial counsel. That’s a huge job, and we’ve seen people languishing in prison because they don’t have access to that right. It’s not being facilitated properly. It’s not being funded properly, and they are the victims, actually. So when you think about “Are we thinking about the victims?”—unfairly tried, wrongfully convicted accused persons are the victims, and we owe it to them to rectify that.

Now, this commission will sit not as a decision maker—this was one of the questions raised by the previous speaker, the Hon Mark Mitchell. This isn’t a body that’s going to be making decisions in our criminal justice system; this is a body that will filter these cases and see if there is cause to have the case raised before our appeal courts. The appeal courts will still remain the judges and the decision makers on appeal cases, but this is a way that experts can actually have a look at the case and can make decisions about whether it is likely that a miscarriage of justice occurred. We haven’t had that, so people do languish in prison, waiting for a lawyer, waiting to find someone that’s willing to do it on the measly pay that the legal aid system now allows for appeals—it treats it like it’s a bit of admin on the side, and that’s just not true.

We need experts to assess whether or not a miscarriage of justice has occurred—whether it’s likely—and to refer them up to the court. It will actually filter out cases, also, that shouldn’t be before the court. So sometimes we do have abuses of that process with overly litigious convicted persons, and we get them constantly before the court, and this will filter that out, as well. So it will make our criminal justice system much more efficient, much more accessible, and much more fair and expert, which is why this is a good day. We’re starting to go down the road that other like-minded nations have gone down, whether that’s England or Scandinavian countries, who do actually prioritise fairness and who do recognise that unfairness sometimes does occur for lack of resources, and that that’s not OK.

So I commend this bill to the House. It is a proud day for our system of justice. Thank you.

KANWALJIT SINGH BAKSHI (National): Thank you, Mr Speaker, for the opportunity to participate in the first reading of this bill. I stand in opposition to this bill. There are a few points which I would like to touch upon. If we go through some of the notes which I have been provided, one group which has been left out is the group of victims. It is very important. We need to understand that they also have got the right.

As has been rightly pointed out by the Hon Nick Smith and Mark Mitchell, this group should have been consulted when this policy was being formed. The consultation, which has been mentioned, has been taken with the convicted individuals, which is important. We understand that everyone has got rights—they should get the real justice. The Governor-General was consulted for this. Courts were consulted. Māori and Pacific people were consulted. No doubt we need to consult with the people who are most affected. Civil society was consulted, lawyers and members of the judiciary were consulted, but victims were left out. That is my point: we should have had this consultation done before this policy or the bill was formulated.

The second thing which I would like to touch upon is the composition of the commissioners. I see that this commission is going to play a very important role. I can see the chair of the Justice Committee sitting over here. He himself has got a legal background—that’s why he is the chair of the Justice Committee. During the select committee process, I would like to bring to his attention that the composition of the commissioners without legal background will be a challenge. We want to have a system, if it is being formulated, that is formulated in a manner where everyone has access to justice. If the commissioners don’t have a judicial background at all, or a law background, then it will be a challenge for them to deal with some of the complex cases which have been mentioned in the Minister of Justice’s speech and by other members of the Government. But I want to make sure that the composition of the commission is equally important, whereas it is important to get the victims into this role.

This commission has been formulated in the UK, Ireland, and other European countries from where the idea has been taken. I think that makes a real challenge for us. We should have learnt some of the things which those commissions—

SPEAKER: Order! This debate is interrupted and set down for resumption next sitting day. The House stands adjourned until 2 p.m. today.

Debate interrupted.

The House adjourned at 1 p.m.