Thursday, 21 November 2019
Volume 743
Sitting date: 21 November 2019
THURSDAY, 21 NOVEMBER 2019
THURSDAY, 21 NOVEMBER 2019
The Speaker took the Chair at 2 p.m.
Prayers.
Business Statement
Business Statement
Hon IAIN LEES-GALLOWAY (Deputy Leader of the House): Today, the House will adjourn until Tuesday, 3 December. Legislation to be considered in that week will include the first reading of the International Crimes and International Criminal Court Amendment Bill; the second readings of the Maritime Transport (Offshore Installations) Amendment Bill and the Ombudsmen (Protection of Name) Amendment Bill; the third readings of the Referendums Framework Bill, the Farm Debt Mediation Bill (No 2), and the National Animal Identification and Tracing Amendment Bill (No 2); and further stages of the Credit Contracts Legislation Amendment Bill. Wednesday, 4 December will be a members’ day.
Hon GERRY BROWNLEE (National—Ilam): I thank the Acting Leader of the House for that indication. The bit that we thought was missing was No. 18 on the Order Paper. Can we take it then that one more year will pass without the Kermadec Ocean Sanctuary Bill making the floor of the House?
Hon IAIN LEES-GALLOWAY (Deputy Leader of the House): Well, I note that when the member asking the question was the Leader of the House himself, that particular bill languished on the Order Paper for about a year. This is a busy Government. We will eventually get to the work that National put in the too-hard basket, but, in the meantime, we’ve got our own legislation to pass.
Hon GERRY BROWNLEE (National—Ilam): I raise a point of order, Mr Speaker. The Acting Leader of the House may like to know that when the words “second reading” are alongside a bill, it means that the Government has dealt with it at some point and sent it to a select committee. What it now means, of course, is that the current Government have done nothing with it for almost two years.
SPEAKER: Right, OK—
Hon Iain Lees-Galloway: Speaking to the point of order—
SPEAKER: No—no more. No more. The member got what he deserved and it’s going to finish there.
Bills
Kermadec Ocean Sanctuary Bill
Setting Down for Second Reading—Leave Declined
Hon Dr NICK SMITH (National—Nelson): I seek leave of the House for the Kermadec Ocean Sanctuary Bill to be set down for its second reading on the next Government sitting day.
SPEAKER: Is there any objection to that?
Hon Members: Yes!
SPEAKER: Right. Look, I know we’re about to have a week’s recess, but we don’t have to behave like we’re a class of school children heading into the holidays.
Oral Questions
Questions to Ministers
Question No. 1—Finance
1. Hon PAUL GOLDSMITH (National) to the Minister of Finance: What steps, if any, has he taken to ensure the integrity of ministerial decisions in the major spending programmes announced in the previous two Budgets?
Hon GRANT ROBERTSON (Minister of Finance): To ensure the integrity of ministerial decisions in the funding of major spending programmes announced through the Budgets, I direct Treasury to prepare the financial recommendations for the Budget Cabinet paper. This involves the recommendations being drafted by responsible agencies in line with the decisions made by Budget Ministers. It involves them being checked by Treasury vote teams to ensure decisions are accurately reflected and that the recommendations are correct. These recommendations are then checked and QA’d by a central team within Treasury, along with a separate review by experienced Treasury staff members who are not involved in developing the Budget. This is exactly the same process as when the member was in Government under Bill English and Steven Joyce as finance Ministers. The responsibility for the integrity of individual ministerial decisions rests with Ministers themselves on advice from the Cabinet Office as appropriate.
Hon Paul Goldsmith: Does he agree that two critical ways the public can be sure of the integrity of ministerial decisions are the register for pecuniary interests and the declarations of donations to respective political parties, so that the public can weigh up perceived or real conflicts of interest?
SPEAKER: This Minister is not responsible for conflicts of interest. I’m going to invite the member to rephrase his question.
Hon Paul Goldsmith: I raise a point of order, Mr Speaker. I am putting to the Minister of Finance a proposition that relates directly to the question, which is about the integrity of ministerial decisions—
SPEAKER: Yes, and I’ve heard enough. I listened very carefully to the question as to whether all of it was within ministerial responsibility, and I ruled that it was not all within this Minister’s responsibility.
Hon Paul Goldsmith: Has anything he has seen in the past three days caused him to question or doubt that the integrity of ministerial decision-making about major spending projects has been maintained?
Hon GRANT ROBERTSON: No. I continue, as all Ministers do, to comply with the decisions that have been made by Cabinet around elements of the Budget process, and with respect to that, and the matters for which I am responsible, no.
Hon Paul Goldsmith: So is he telling the House he has seen nothing in the past three days that causes him to question or doubt the integrity of ministerial decision-making about major projects for which he is responsible?
Hon GRANT ROBERTSON: As I said in my previous answer, for the matters for which I am responsible, no.
Hon Paul Goldsmith: Has he spoken directly to the Deputy Prime Minister in the past three days about real or perceived threats or questions about the integrity of ministerial decision-making?
Hon GRANT ROBERTSON: No, in respect of the matters that I am responsible for.
Hon Paul Goldsmith: Has he considered putting on hold major spending decisions involving New Zealand First Ministers until the serious allegations involving donations are investigated or resolved?
Hon GRANT ROBERTSON: No.
Hon Paul Goldsmith: Why not?
Hon GRANT ROBERTSON: Because I am doing my job, following through on the recommendations agreed to by Cabinet with respect to the Budget. For the matters for which I’m responsible, I continue to work closely with all of my ministerial colleagues.
Hon Paul Goldsmith: Does he have any concern about public perceptions about the integrity of ministerial decision-making on major spending projects in his Government?
Hon GRANT ROBERTSON: As I said, with respect to the matters for which I am responsible, I continue to keep an eye on those. I do not have any specific concerns. I can say one thing for sure: I’m not going to take advice from the National Party about transparency of political donations.
Question No. 2—Finance
2. CHLÖE SWARBRICK (Green) to the Minister of Finance: Will he issue a direction to ACC to divest the $920 million currently invested in fossil fuels?
Hon GRANT ROBERTSON (Minister of Finance): The responsibility for managing ACC’s investment funds does lie with the ACC board, which through its investment subcommittee regularly reviews and approves its investment guidelines, including its ethical investment policy. This independence is an important feature of the Crown entity model, which creates an arm’s-length relationship between Ministers and Crown entities as set out under the Crown Entities Act. While I am not intending to issue a ministerial direction, I have recently written to all Government investment funds to outline my expectations around investment practices. This includes regular reviews, reflecting best practice, and ensuring that we meet the highest ethical standards as New Zealanders would want us to.
Chlöe Swarbrick: Does he think ACC, as New Zealand’s largest Crown entity investor, should follow the lead of the New Zealand Superannuation Fund, who in 2017 divested $950 million from fossil fuels?
Hon GRANT ROBERTSON: As I said in my primary answer, those decisions are indeed for the ACC and the super fund and their investment committees to make. I think we can agree that this Government is taking climate change seriously, using our regulatory role on the emissions trading scheme to influence investment behaviours, and I’m sure all of the Government’s investment institutions will be well aware of the direction of travel.
Chlöe Swarbrick: Well, given that ACC has said they base their ethical investment decisions on Government direction and perception of the public, in his view is bipartisan support for climate change legislation strong enough a signal that the Government and the public would like to see ACC divest from fossil fuels?
Hon GRANT ROBERTSON: To repeat for the third time the answer, it is the responsibility of ACC to make their investment decisions. I do understand the point that the member is making—that the direction of travel around climate change policy, as we saw in the House, had bipartisan support. We have seen what the super fund has done, and I’m sure the ACC will also be aware of my letter that I have written to them as well.
Chlöe Swarbrick: Is the Minister aware of his powers to direct ACC to divest under the Crown Entities Act?
Hon GRANT ROBERTSON: As I said in my answer to the primary question, I’m aware of the power of ministerial direction. I’m also aware of the power of the letter of expectations that was written to our investment agencies. That is the approach that I took, and I wrote to them as recently as last month on these matters.
Question No. 3—Social Development
3. WILLOW-JEAN PRIME (Labour) to the Minister for Social Development: Is the Government’s Families Package supporting Māori; if so, how?
Hon CARMEL SEPULONI (Minister for Social Development): We know that Māori disproportionately experience lower incomes than non-Māori. Under the Families Package, low and medium income households have benefited significantly through a winter energy payment to help heat their homes over winter, a Best Start payment for families with a baby, a boost in Working for Families family tax credit payments, and increases to the accommodation supplement and accommodation benefit—action this Government is taking is helping to lift Māori whānau and tamariki out of poverty.
Willow-Jean Prime: What is the impact of the Families Package on Māori whānau and tamariki?
Hon CARMEL SEPULONI: I can report that the Families Package monitoring report released yesterday has shown us that 138,928 Māori main beneficiaries and superannuitants received the winter energy payment at the end of June 2019, giving them up to $31.82 extra per week over the winter months to warm their homes. Almost half of the 11,490 unsupported child carers are Māori and received the increase of $20.31 per week, as well as receiving up to $33.84 per week through the clothing allowance; and 91,240 Māori receiving the accommodation supplement received an increase, on average, of about $24 per week.
SPEAKER: Order! Order! That answer has now gone on for too long.
Willow-Jean Prime: Why is this important?
Hon CARMEL SEPULONI: We know that Māori are a much more youthful population, with huge potential. The median age for Māori is 23.9 years compared to 38 for New Zealanders overall. We also know that Māori have higher birth rates compared to the general population, particularly in urban centres. This means Māori will make up an important part of our future workforce, so ensuring that they have the best start in life is a priority for this Government, and we are heading in the right direction.
Question No. 4—Housing
4. Hon JUDITH COLLINS (National—Papakura) to the Minister of Housing: Are there any plans to sell unsold KiwiBuild homes to Kāinga Ora for State housing?
Hon Dr MEGAN WOODS (Minister of Housing): I have not been advised that Kāinga Ora are currently assessing any unsold KiwiBuild homes for purchase for State housing. If the member is referring to former KiwiBuild houses in Wānaka, Te Kauwhata, and Canterbury that were released to the open market at the KiwiBuild reset, the first broad assessment of Te Kauwhata and Wānaka was that they weren’t suitable as State houses. However, we continue to take a pragmatic approach in Canterbury, and, if the demand is matched with the specific needs of people on the State house waiting list, then they would and could be considered. I’d like to point out to the member that this Government is building a record number of State houses, with 2,178 extra houses added in the last financial year. Our Government is committed to increasing State house supply and ensuring that houses meet people’s needs. In fact, we’re a Government that’s built more houses than any Government since the 1970s.
Hon Judith Collins: How many current or former KiwiBuild homes have been built but not sold?
Hon Dr MEGAN WOODS: Of the current KiwiBuild homes, there are 75 that are not currently sold. Some of those have conditional sales attached to them. The number that have been on the market for longer than six months is around 18, and four of those have conditional sales. In terms of the former KiwiBuild homes, that was all released at the time of the reset.
Hon Judith Collins: What is the longest amount of time a KiwiBuild home or former KiwiBuild home has been unsold since the programme began?
Hon Dr MEGAN WOODS: If the member wants to put that question in writing, I’ll happily answer it, but, as I intimated in my previous answer, there are currently around 18 houses that are unsold and have been unsold for longer than six months, and four of those have conditional offers attached to them.
Hon Judith Collins: When she wrote in the Resetting the Government Build Programme Cabinet paper “Any development carries some risk and we may find we cannot sell some homes.”, what does she propose doing with those homes that cannot be sold even on the open market?
Hon Dr MEGAN WOODS: If the member had read through the Cabinet paper, not just that paragraph, what she would have seen is there is a clear process for the disposal of unsold KiwiBuild homes that was built into the reset—that is, they will not have the conditions of KiwiBuild first-home buyers or second-chance buyers attached to them; they will be open market sales.
Hon Gerry Brownlee: Sold at fire-sale prices.
SPEAKER: Order!
Hon Gerry Brownlee: It’s fair.
Hon Dr MEGAN WOODS: We have not had to see any former KiwiBuild homes fall into—
Hon Gerry Brownlee: Fire-sale prices.
Hon Dr MEGAN WOODS: —the category of unsellable at this stage.
SPEAKER: I indicated to the shadow Leader of the House that he should be quiet, and he defied me. He won’t again—at least over the next 10 minutes, I hope.
Hon Judith Collins: When she wrote in the same Cabinet paper “The homes are not generally suitable for HNZ as they have not been built to the public housing design standard and community housing providers have not expressed interest.”, does that mean that Kāinga Ora State tenants are not expected to live in former KiwiBuild homes?
Hon Dr MEGAN WOODS: I think the member is getting quite confused around different typologies. There are homes that are built for first-home sale, which are KiwiBuild homes. When it comes to the provision of State housing, there are quite different design standards, and I’ll talk through that. The bedroom size, for instance, is quite different in a house that is built for public housing needs. These are built with the intention of two or three beds being put in children’s bedrooms. This is not what the first-home buyer market is demanding. The fixtures also have a focus on durability so that maximum flexibility can be provided to the landlord. I understand very well that members on the other side of the House probably don’t understand what it takes to build a State house, given that they finished their last term of Government with fewer than they started with.
Hon Judith Collins: Does she not understand that there is a cohort of elderly people who need a State home that does not necessarily have three or four or five bedrooms; and, if she does, then why cannot they be considered as people who can be housed in these brand new and unused KiwiBuild homes?
Hon Dr MEGAN WOODS: Quite simply because they’re not the houses that are currently being offered on the open market. For example, if we look at demand in Canterbury, the majority of the demand is for one-bedroom units. These are not the former KiwiBuild homes that are being offered. We have looked very carefully at the demand of the public housing waiting list and register against the stock that is for sale, and they simply do not match.
Hon Judith Collins: Does the proposal to dispose of unsold KiwiBuild and former KiwiBuild houses mean a possible fire sale at a discount price on the build cost?
Hon Dr MEGAN WOODS: No.
Question No. 5—Health
5. Dr LIZ CRAIG (Labour) to the Minister of Health: What progress has been made rolling out the National Bowel Screening Programme?
Hon Dr DAVID CLARK (Minister of Health): More good news: last week, I joined the Prime Minister at Palmerston North Hospital to mark the start of the National Bowel Screening Programme at MidCentral District Health Board. That means the roll-out has reached the halfway mark with 10 out of 20 district health boards now part of the programme. The programme now covers a population of around 360,000 people aged 60 to 74, who are being offered screening every two years. The screening test itself is simple and can be done in the privacy of your own home, and it can save your life.
Dr Liz Craig: So what are the benefits of bowel screening?
Hon Dr DAVID CLARK: People who are diagnosed with early-stage bowel cancer and who receive treatment early have a 90 percent chance of long-term survival. Since it started just over two years ago, the National Bowel Screening Programme has screened more than 194,000 people. As a result, 434 cancers have been detected earlier than they otherwise would have been, giving those individuals a better chance of survival, and on top of that, hundreds of pre-cancerous polyps have also been removed.
Dr Liz Craig: So how does the National Bowel Screening Programme relate to the Government’s overall approach to cancer care and control?
Hon Dr DAVID CLARK: This Government has a comprehensive plan to modernise our approach to cancer. A key part of that is prevention and early detection through screening programmes such as the bowel screening programme. At the same time, we’re funding more cancer medicines and we’re purchasing 12 new linear accelerators, including plans to put machines into Hawke’s Bay, Taranaki, and Northland for the first time ever. We’ve appointed an interim Director of Cancer Control and we’re establishing a Cancer Control Agency to provide the strong, central leadership the sector has been crying out for. Improved cancer outcomes is a long-term challenge, but we are making real progress.
Question No. 6—Children
6. Hon NIKKI KAYE (National—Auckland Central) to the Minister for Children: Does she stand by her statements and actions regarding the Child and Youth Wellbeing Strategy?
Hon TRACEY MARTIN (Minister for Children): Yes, in the context in which they were given.
Hon Nikki Kaye: Can she confirm that schools have not opted into the free school lunches programme as part of their strategy because they are concerned about losing KidsCan and KickStart support?
Hon TRACEY MARTIN: I think it would be helpful to refer to page 67 of the strategy to help the House to understand my ministerial responsibilities: “There are legal and operational arrangements in place to ensure collective Ministerial and agency-level governance and accountability for developing and implementing the strategy ... The Minister Responsible for Child Poverty Reduction and the Minister for Children have shared overall responsibility for developing the Strategy with specific policy areas and actions co-led by other Ministers and their agencies.” As Minister for Children, I am responsible for the policy areas related to the work being progressed by Oranga Tamariki. The school lunches programme is being progressed by the Minister of Education.
Hon Nikki Kaye: I raise a point of order, Mr Speaker. Well, actually, I have got information which indicates not only that the briefings are jointly in the name of the Prime Minister and the Minister for Children but that development of the strategy is certainly the responsibility of this Minister.
SPEAKER: Well, that’s exactly what the Minister just said.
Hon Nikki Kaye: Can she confirm that in the development of the strategy, she considered that Ministry for Primary Industries officials were consulted only several days before the announcement and that a lack of funding for kitchen infrastructure was included as part of that development?
Hon TRACEY MARTIN: That is correct. As part of the development of the lunches in schools programme, there needed to be consideration and advice received around the capacity of schools to deliver the lunches in schools programme, and also we like to do rural-proofing on all of the policies that this Government does to make sure that we acknowledge rural communities need different solutions than urban communities.
Hon Nikki Kaye: Can she confirm that her child and wellbeing strategy is not on track to be delivered, given that a number of schools have said they will not opt into the programme because of poor planning and they will not take part until term 2 of next year?
SPEAKER: Any one of the three.
Hon TRACEY MARTIN: The strategy is on track to being delivered. The strategy is a large series of actions. The questioner has asked me about whether a specific action is on track to be delivered, and that specific action—the lunches in schools—is the responsibility of the Minister of Education.
Hon Nikki Kaye: I raise a point of order, Mr Speaker. This is a ridiculous scenario if the Minister responsible for the strategy has absolutely no relationship as to whether it’s actually going to be delivered, because she’s taking no responsibility—
SPEAKER: Well, the Minister read out the responsibilities very clearly in the way that they’re organised. And if the member does have something which relates to Speakers’ Rulings and the Standing Orders which differs or the member can point to, to require the Minister to answer something which she has indicated is not part of her responsibility, then the member should show it to me.
Hon Nikki Kaye: When she was planning her child, youth, and wellbeing strategy, did she consider that there would be a whole lot of kids that would be cut off from support, as part of one of her initiatives, at the age of 12 years old, as they are complaining in parts of New Zealand?
Hon TRACEY MARTIN: When we were considering the Child and Youth Wellbeing Strategy, when we were discussing it with the 10,000 New Zealanders that participated—6,000 of those being children and young people—we considered all avenues of how best we could support children, all children, as many children as possible, through the actions of the strategy. I’m happy to table the current programme of action for the member. But as she will know, as a previous Minister, there are limitations on budget. There are limitations on many other areas, including the capacity to have kitchens that can provide lunches in schools. So we work within the boundaries that we have to do the best for the children of New Zealand—all of them.
Hon Nikki Kaye: Can she confirm that she cannot deliver on her strategy because one of the core initiatives that was announced by the Prime Minister is behind schedule, plagued with multiple problems, and has a whole lot of people that don’t want to be part of it?
SPEAKER: Order! Order! The member is allowed to have two legs to a question. That one had four.
Hon TRACEY MARTIN: I cannot confirm that. I think what the member is alluding to is that the lunches in schools programme is supposed to be rolled out at the beginning of the 2020 school year. We are not yet at the beginning of the 2020 school year. For any further detail on that particular action, she will need to direct her questions to the Minister of Education.
Hon Nikki Kaye: Will she take responsibility for one of the flagship initiatives in her strategy not being delivered if it does not line up with 30 schools being part of the programme as part of term 1 next year?
Hon TRACEY MARTIN: I think that the difficulty that the member is having is the collective responsibility of Ministers in the Child and Youth Wellbeing Strategy. I do understand that this is a different way for a Government to work; that this Government is the first Government who is breaking down the silos of delivery and we’ve all purchased into the actions. And so the Minister of Education, the Minister for Children, the Minister for Child Poverty Reduction, we all carry responsibility for the individual actions of our individual ministries to deliver on the overall strategy for New Zealand.
Question No. 7—Regional Economic Development
SPEAKER: I just give a warning. I have been warned that the answer to this question is longer than the Minister generally gives.
CHRIS BISHOP (National—Hutt South): OK. Thank you, Mr Speaker. To the Minister for Regional Economic Development: on what date was N.Z. Future Forest Products Ltd’s application to the Provincial Growth Fund lodged—
SPEAKER: Sorry, I apologise. I have confused it with question No. 9. This one couldn’t possibly be longer than the Minister generally gives. Can the member start again—I apologise.
CHRIS BISHOP: Oh, I was getting very excited then. OK, I’ll start again.
7. CHRIS BISHOP (National—Hutt South) to the Minister for Regional Economic Development: On what date was N.Z. Future Forest Products Ltd’s application to the Provincial Growth Fund lodged, and when did he first become aware that N.Z. Future Forest Products Ltd had applied to the Provincial Growth Fund?
Hon SHANE JONES (Minister for Regional Economic Development): I am advised the application was lodged on 8 April. I found out that the application was coming to Ministers for consideration on 14 October.
SPEAKER: No, I’m going to—
Chris Bishop: Point of order—
SPEAKER: No, I don’t want a point of order. I want the Minister to answer the second leg of the question.
Hon SHANE JONES: April 8 was the date that the company’s application was lodged. I became aware that the company had applied to the Provincial Growth Fund on 14 October.
SPEAKER: Thank you.
Chris Bishop: What is the conflict of interest that meant he recused himself from any decision making about the application to the Provincial Growth Fund?
Hon SHANE JONES: When I became a Minister, I identified a relationship I had with Mr Brian Henry, and, at that point, upon learning an application was wending its way through the process, because I had identified that association when I became a Minister, I recused myself.
Chris Bishop: Is he saying to the House that between 8 April, when the application was lodged, and 14 October, when he declared a conflict of interest in relation to decision making about the application, he was not aware an application had been made?
Hon SHANE JONES: I repeat again: I became aware of a formal application coming to Ministers on 14 October. I have asked my staff to go back and to test—
Hon Amy Adams: When did the Minister know it had been made?
Hon SHANE JONES: —whether or not there had been any briefings—
SPEAKER: Order! Order! Order! The member will resume his seat. This is a very important question. I want to hear the answer, and Amy Adams is—
Hon Amy Adams: He didn’t answer it.
SPEAKER: Amy Adams is interfering with me hearing the answer. She will not interject again during question time. Sorry, I’m going to go right back and I’m going to ask for the supplementary question to be asked again.
Chris Bishop: I’m possibly paraphrasing a little bit. Is he saying to the House that between 8 April, when the application was lodged, and 14 October, when he recused himself from any decision making about the application, he was unaware that an application had been made?
Hon SHANE JONES: I became aware of this formal application on 14 October. I have asked staff to ascertain whether, in the wodge of papers that, from time to time, wash up in my office, there was any reference at all to Mr Brian Henry in any application, and they have told me zero—that there was no reference whatsoever to that application from that individual.
Chris Bishop: Was he aware informally between 8 April and 14 October that Mr Henry and N.Z. Future Forest Products Ltd had made an application to the Provincial Growth Fund?
Hon SHANE JONES: I repeat again: 14 October is a date of great significance. That is the date that I was formally notified of the application. Now, I must say that given the development of proposals and the gestation that proposals go through, I would not know, at the level of the officials, who is dealing, given that there are 2,500 proposals, and it’s akin to me being on the bridge—I’m not down in the boiler room.
Chris Bishop: Between 8 April and 14 October, was he aware that N.Z. Future Forest Products Ltd was in discussions with officials from the provincial development unit about a possible future application—a formal one—to the Provincial Growth Fund?
Hon SHANE JONES: As I’ve said, the life cycle of the Provincial Growth Fund application is that it’s akin to the life cycle of an insect. There is no shortage of people, throughout New Zealand, in particular provinces—because I am a crowd-pleaser in the provinces. I send all people interested in the Provincial Growth Fund to go and see the officials. The officials help them navigate the process. When an official decision is required, that’s when one exercises the judgment: are you in a position where you need to recuse yourself? So it is most important that the House focuses on the date of 14 October, when I was formally notified that an application was on its way to the Ministers.
Chris Bishop: I raise a point of order, Mr Speaker.
SPEAKER: I know what the point of order is. It was wonderful rhetoric but it did not address the question.
Hon SHANE JONES: Until 14 October, I was not formally notified of the existence of an application. I am advised, however, that officials have put in reports the name of the company they were dealing with. Unfortunately, I had no idea who that company was.
Chris Bishop: Was he aware of discussions taking place between N.Z. Future Forest Products Ltd and officials at the provincial development unit between 8 April, when the application was made, and 14 October, when he recused himself?
Hon SHANE JONES: As I said, I am not aware of the detail—the extent—of any discussions between Mr Brian Henry or a company I had never heard of and did not recognise until such time as a formal duty fell upon me to make a decision. At that point, I recused myself. Then it was turned down, which is how the process works.
Chris Bishop: Why did David Henry email his office on 21 September about the project, and why didn’t he declare a conflict then?
Hon SHANE JONES: There is no conflict between myself and a Mr David Henry, an individual I might have met once or thrice. I have clearly stated that I have a longstanding relationship with Mr Brian Henry, belonging to a family who has had 150 years of involvement in forestry. In fact, if any individual wants to contribute to the development of our forestry strategy and is looking for some support from the Government, they go through the formal process and they take their chances. In this case, they were unsuccessful.
Chris Bishop: Was he aware at any point between 8 April and 14 October that representatives from N.Z. Future Forest Products Ltd were in discussions about an existing application or possible future application to the Provincial Growth Fund?
Hon SHANE JONES: I repeat again: the point at which I became formally notified was 14 October. Now, the member has identified an email. I get so many of them; I have no recollection of it. Now, whether or not that individual or that company was talking to officials, as I said, that’s at the stage when the application is a larva stage, or the pupa stage—the time I wouldn’t be involved.
Hon Grant Robertson: Can the Minister confirm that N.Z. Future Forest Product Ltd’s application to the Provincial Growth Fund was declined?
Hon SHANE JONES: The application from the said company, I understand, was declined by fellow Ministers after I had recused myself. I would say that New Zealanders who may belong, or may have associations with politicians, are welcome to engage with the bureaucracy. It’s when a Cabinet Minister is required to exercise allocated authority—that’s when you recuse yourself, which, obviously, I have done, with considerable skill.
Question No. 8—Building and Construction
8. PAUL EAGLE (Labour—Rongotai) to the Minister for Building and Construction: Is the Government supporting regional building owners; if so, how?
Hon JENNY SALESA (Minister for Building and Construction): This Government is implementing changes to our earthquake-prone building regime. Provincial building owners will benefit from these changes because we’re relaxing the requirement for expected strengthening work to be done on low-value properties. Under the existing rules, if a building owner makes improvements worth more than 25 percent of a building’s value, they’re required to do a full earthquake seismic strengthening, even if the value of the building is low. However, the change we made by adding a minimum dollar value of $150,000 of building work to the criteria for substantial alterations before costly strengthening has to occur means that our Government has delivered a major break for provincial building owners.
Paul Eagle: How has the Government worked with regional building owners and councils on this change?
Hon JENNY SALESA: The Government has listened to regional building owners and councils. I heard from business owners who wanted to use empty buildings in small towns to open shops and cafes, but couldn’t under the previous law. I was honoured to stand beside the mayors of Manawatū, Rangitīkei, Whanganui, and Horowhenua, who wanted this change, when we made the announcement in Feilding. Thanks also to New Zealand First for their strong advocacy on this issue.
Paul Eagle: What feedback has she seen on these changes?
Hon JENNY SALESA: I was pleased to see comment from Masterton Trust Lands Trust’s general manager, Andrew Croskery, when he said that this change would help to keep central business districts alive. Mr Croskery went on to say—and I quote—“The ability to tenant buildings at significantly lower cost now, while planning for structural work in the future, will provide the cashflow needed to ultimately strengthen those buildings.” This Government is ensuring we continue to have thriving rural towns and communities.
Question No. 9—Justice
SPEAKER: This is a question with a slightly longer answer.
9. Hon Dr NICK SMITH (National—Nelson) to the Minister of Justice: Does he agree with the statement by electoral law expert Professor Andrew Geddis regarding the disclosure of donations at the 2017 election, “You can’t have a country’s political system run in this way and be considered the second least corrupt nation on the planet”?
Hon ANDREW LITTLE (Minister of Justice): Yes, and I agree that we can’t build a reputation for our political system which is based on electoral spending that is only “pretty legal”, a Serious Fraud Office investigation into a questionable $100,000 donation to the National Party, Ministers—
Hon Gerry Brownlee: I raise a point of order, Mr Speaker. You are quite insistent that the grammar in questions is precise so that you’re able to rule more easily on the answers being given by Ministers. This question refers to donations at the 2017 election. So far, the Minister, in his addressing of this question—or attempt to address this question—has, it would seem, missed the point of the question.
SPEAKER: I’m going to let the Minister continue, in the hope that he’ll get strictly within the bounds of the question soon.
Hon ANDREW LITTLE: I raise a point of order, Mr Speaker. The heart of the question goes to the reputation of this country’s political system—that’s what the quote from Mr Geddis refers to.
SPEAKER: Yes, and I’ve now looked at the question again carefully; it does have two legs. The first leg, the Minister has answered by saying “Yes”, and he can now answer the second leg, which goes to a much broader quote on the part of Dr Geddis.
Hon ANDREW LITTLE: To pick up where I left off, we were at: Ministers in a previous Government travelling on the taxpayers’ dollar to shill for overseas support, confusing private and personal interests in relation to—
Hon Dr Nick Smith: I raise a point of order, Mr Speaker. It is quite proper for a Minister to seek leave, and to notify the Speaker, to have a longer answer. I think it’s inappropriate for that to be used as an opportunity to have a go at the Opposition parties.
SPEAKER: Well, I think it’s a little bit rich for someone—[Interruption] Who laughed then, loudly? The member will leave the House. He can come back for question 11.
Hon Damien O’Connor withdrew from the Chamber.
SPEAKER: Yes, Upper Moutere, it was your member. It is a little bit rich for someone who asks a very political question to be unhappy when there is a political answer. Andrew Little, start again.
Hon ANDREW LITTLE: Yes, and I agree that we can’t build a reputation for our political system which is based on electoral spending that is only “pretty legal”, a Serious Fraud Office investigation into a questionable $100,000 donation to the National Party, Ministers in a previous Government travelling on the taxpayers’ dollar to shill for overseas support, confusing private and personal interests in Oravida, doing questionable deals over convention centres—
Hon Gerry Brownlee: I raise a point of order, Mr Speaker. The Minister answering the question knows full well that electoral rules have been changed on numerous occasions, and the rules that related to 2017 and the 2017 election are the rules that are in question. I think it’s quite unreasonable for the Minister to take a defensive position in support of his coalition partner by using this opportunity to have a go at the Opposition.
SPEAKER: Order! Order! There’s been no reference to any coalition partner at all that I’m aware of. Now, the problem I’ve got now is whether I get the Minister to start again, but I think I’ll just get him to wind back slightly rather than start from the beginning again.
Hon ANDREW LITTLE: Thank you, Mr Speaker. I only have one other point to raise in relation to our political reputation abroad, and that, of course, relates to the funnelling of candidate donations through the National Party head office to confuse their origins, which happened in the 2017 general election.
Hon Dr Nick Smith: Is it consistent for the Minister of Justice to refuse to make any comment about the front-page headlines of the last three days regarding his coalition partner, but express extensive views about matters that go many years back?
Hon ANDREW LITTLE: The issues that have been the subject of the front-page headlines for the last few days are the subject of, at the very least, a preliminary investigation by the Electoral Commission. The Electoral Commission is independent of the executive Government. It would be entirely inappropriate for me to comment on a matter that the Electoral Commission is investigating into, because I don’t want to end up like the member who asked the question, with a conviction for contempt.
Hon Dr Nick Smith: Supplementary—supplementary? He always goes after the person—
SPEAKER: Order! Order! The member will resume his seat. If the member wants a further supplementary, he can have one. He’s just had one ruled out.
Hon Gerry Brownlee: I raise a point of order, Mr Speaker. That is extremely unfair, in my view. You sat there and listened to a totally gratuitous flick coming from the Minister of Justice, someone who a higher standard might be expected of, particularly when dealing with members in this House—
Fletcher Tabuteau: Point of order.
Hon Gerry Brownlee: —and particularly at a time—I’m in the middle of one. Sit down, fella.
SPEAKER: Sit down.
Fletcher Tabuteau: This isn’t a point order; it’s a speech.
SPEAKER: I think for the first time since I’ve been Speaker, we’re going to have two out at the same time. Away you go.
Fletcher Tabuteau withdrew from the Chamber.
SPEAKER: He was, of course, right.
Hon Gerry Brownlee: Beg your pardon?
SPEAKER: He was right. It is not a point of order yet.
Hon Gerry Brownlee: No, but you’ve got to, of course, frame it, because otherwise, how could you rule?
SPEAKER: No. The member, I think it’s fair to say, is taking quite a big frame.
Hon Gerry Brownlee: Well, I’ll get right to the point. I think if you were to, at a later point, look at the Hansard, you’d find that it was an unreasonable comment, it doesn’t help the order of the House, and denying Dr Smith of some of the limited supplementaries that we get on this side of the House, I think, is unreasonable.
SPEAKER: And the member is aware of the fact—or should have been aware of the fact—that I shut the Minister down when he started his flick.
Hon Dr Nick Smith: Does he agree with the further statement by Professor Andrew Geddis, and I quote, “If what has been reported is both true and not a breach of the rules of political donations, then New Zealand’s reputation for being squeaky clean looks like a joke.”?
Hon ANDREW LITTLE: I’m aware that Professor Geddis takes a very close interest in the operation of our electoral systems, and he has made that comment; I acknowledge it. He made another one, too, in relation to the funnelling of donations through the National Party headquarters to National Party candidates, when he said, “After all, it’s extremely rare for this elite law enforcement agency”—the Electoral Commission—“to be asked to look at an electoral law matter, let alone one allegedly involving the Leader of the Opposition having some role in illegally funnelling six figures’ worth of cash to his party.”
Hon Dr Nick Smith: Are New Zealand electoral laws on disclosure of significant donations working to the satisfaction of Government when a party can avoid disclosure by having a separate foundation fund all sorts of campaigning activities, like fund-raising websites, guest speakers, and advertising?
Hon ANDREW LITTLE: I think it is most unfortunate that there is at least one party who thinks that it is acceptable to conceal the origin of donations to individual candidates by funnelling it all through their party headquarters. But I expect the Justice Committee, in its inquiry into the 2017 general election—an inquiry that has now been running for roughly 18 months—to report on all matters associated with that general election. I am still waiting for their report.
Hon Grant Robertson: Can the Minister confirm that the disclosure of donations regime in place at the 2017 election, as noted in the primary question, was a regime overseen by the former Government?
Hon ANDREW LITTLE: I can confirm that the law, as it is today, is as it was in 2017 under that previous Government. I’m not aware of any changes made to the donations regime under that Government. It is very clear that a principal objective of the donations regime, as it appears in our 1993 Electoral Act, is for a level of transparency, but that seems to be defeated when you channel all your donations to candidates through party headquarters and nobody knows who is supporting particular candidates.
Hon Gerry Brownlee: Does that then mean that the Minister is concerned that the $840,000 unexplained by the New Zealand First Party is of concern to him?
Hon ANDREW LITTLE: Well, I only work on facts, and I’m waiting to see whether the facts are established, but one fact is very clear: there are National Party candidates who received donations for their localised electorate campaigns, the entirety of which came from National Party headquarters.
Kieran McAnulty: What trends has he seen in New Zealand’s Corruption Perceptions Index?
Hon ANDREW LITTLE: A very good question. Transparency International’s Corruption Perceptions Index has been running since 1995. Overall, New Zealanders can be satisfied that we consistently rank amongst the least-corrupt countries in the world. However, in three different years we crashed right out of the top three—those years were 1997, 1998, and 2014, and I’ll leave members to guess which Government was in place during those years.
Hon Dr Nick Smith: Will the Government establish an independent inquiry into the serious allegations about non-disclosure of electoral donations at election 2017 to protect the number one ranking that National bequeathed to this Government from Transparency International in 2017?
Hon ANDREW LITTLE: I don’t share the chronic lack of faith that member has in parts of our Public Service, but we have an independent electoral commission; their reputation is absolutely outstanding. Their job is to deal with law enforcement issues in relation to our electoral code. They are doing that. They do it, they do a very good job, and I remain to see what they have to say about the matter.
Hon Dr Nick Smith: I seek leave of the House to table an email to myself and Simon Bridges, received today, from the Rt Hon Winston Peters’ lawyer, Mr Brian Henry, threatening to sue for $30 million if statements made in Parliament are repeated outside the House, with the exclusion of some personal information in that email.
SPEAKER: Is there any objection to that being tabled? There appears to be none.
Document, by leave, laid on the Table of the House.
Ginny Andersen: What other reports has the Minister seen regarding donations at the 2017 general election?
Hon ANDREW LITTLE: I may well have canvassed this, but there are quite a few interesting reports: one from a candidate that declared a total of $54,000 in donations, one that declared a total of $38,000 in donations, and one for $59,000 in donations—all from the National Party. And those reports were from Chris Bishop, Lawrence Yule, and Andrew Falloon.
Kieran McAnulty: Does he agree with the statement by electoral law expert Professor Andrew Geddis, regarding the disclosure of donations, that “It’s plainly a very bad look”?
Hon ANDREW LITTLE: As I’ve said before in this House—[Interruption]
SPEAKER: Order!
Hon ANDREW LITTLE: I have said before in this House, in relation to Professor Geddis, that I agree with some things he says; I disagree with others. But I agree with his very close interest in matters of electoral law and compliance with the donations regime, and I think his comments about the National Party funnelling donations through their head office I agree with entirely.
Hon Grant Robertson: To take the Minister back to the supplementary before last, is he saying that those members that he mentioned declared only a donation from the National Party headquarters and no other donations whatsoever, and how credible does he find that?
SPEAKER: The first part he can answer.
Hon ANDREW LITTLE: Well, yes, that is correct. The only donations declared were those from the head office of the National Party.
Hon Dr Nick Smith: I raise a point of order, Mr Speaker. I seek the leave of the House to table the electoral return of Mr Tamati Coffey, which shows that Labour pooled, regionally, the donations in the candidates’ declaration of expenditure.
SPEAKER: OK—the answer to that is I’m not going to put it, because it is publicly available on the website, and, frankly, no laundromats are going to be tabled in here.
Question No. 10—Energy and Resources
10. JONATHAN YOUNG (National—New Plymouth) to the Minister of Energy and Resources: Does she think Kiwi households and businesses will be paying lower electricity prices in a year’s time?
Hon Dr MEGAN WOODS (Minister of Energy and Resources): As I’ve covered before, the price they pay will depend on a range of factors. These factors include the amount they use, retail overheads, distribution costs, the wholesale market transmission charges, and any other contractual terms that may apply. However, I note that the futures price for one year from today is lower than the current wholesale price, so the market is expecting to see some movement. At the same time, I have seen some industry commentary predicting price rises, so this is an issue of contested debate. I’m also aware of three trends putting downward pressure on prices: falling costs of capital, which will mean lower transmission charges; we are now seeing over $880 million being invested in new renewable energy generation over the coming year, which means lower prices for New Zealanders over the long term because they have the lowest levelised cost; and the Government has also started implementing the recommendations—
SPEAKER: Order! We have heard this before.
Jonathan Young: Thank you. So does she agree with the Electricity Authority who, two days ago, said that the increase in future prices for the next three to four years appears indicative of a change in the fundamental drivers used to price electricity—in particular, the increasing impact of a tighter gas market appears to be leading to higher longer-term wholesale electricity prices?
Hon Dr MEGAN WOODS: As I said, there is currently contested debate in the industry. What I’ve also said is the futures price today is lower than it will be in a year. I’d also point out that, in terms of the costs that a consumer sees on their electricity bill, 31.9 percent of that amounts from generation. I’d also note that, counted against that, we have the recent Commerce Commission decision on Transpower’s price-quality path, which should see consumers pay lower prices as a reduction in the cost of capital as reflected in lower revenue limits for Transpower, which are 15 percent less than the current five-year period. So there are many factors at play here.
Jonathan Young: So does she, then, disagree with Fraser Whineray, chief executive of Mercury Energy, who just last week said that the electricity sector is showing significant stress and that there is a risk of current and spot wholesale prices flowing through to households and residences?
Hon Dr MEGAN WOODS: As I said, there are many views in the industry. I’ve also had conversations with Fraser Whineray, who has told me that gas has got expensive because it was proved to be unreliable last year. So that fear is being priced into the market. The energy prices are going up in the wholesale market, but the retail flow-through is not clear. He has also commented to me extensively about the very positive signals being given to the industry to build renewable generation, which has the lowest levelised cost.
Jonathan Young: So does she or doesn’t she think that Kiwi households and businesses will be paying lower electricity prices next year?
Hon Dr MEGAN WOODS: As I have told the member on several occasions now, that depends on a range of factors. This is a competitive market and companies will make decisions about how they balance those inputs into their retail pricing to consumers.
Jonathan Young: Well, with the reduction in natural gas availability being replaced with more expensive imported coal for electricity generation, does she now regret not listening to the Ministry of Business, Innovation and Employment’s advice last year around the oil and gas exploration ban—that it would increase the price of electricity in New Zealand and increase emissions in New Zealand, as it has done?
SPEAKER: Again, any one of those.
Hon Dr MEGAN WOODS: I’ll address the leg of the question that was the increase in the price of gas because of a shortage of supply. That is patently just wrong. What we are seeing are some problems around contracting, but I am reassured by many parts of the industry that there is no shortage of supply. In fact, the estimates that we have around the security of supply of gas are the same as they have been for decades: 11 years.
Question No. 11—Agriculture
11. KIRITAPU ALLAN (Labour) to the Minister of Agriculture: What recent reports has he seen about the performance of the agricultural sector?
Hon DAMIEN O’CONNOR (Minister of Agriculture): There is a lot of good news for the sector. The recent ASB commodity price report, headlined “Rewriting the record books”—here it is—says that our farmers and growers are in a sweet spot. The ASB’s index for primary sector exports shows it’s at record highs above its 2011 level. So farmers and growers are getting better prices for their work under this Government than the last National one. Specifically, lamb prices have set fresh record highs in eight of the last nine weeks. Lamb prices cracked $9 a kilogram for the first time ever last week. Meanwhile, beef prices are not far behind, with AgriHQ’s beef index setting records each week since 11 October. Seafood prices have also been regularly setting fresh record highs since March. It’s all good news.
Kiritapu Allan: What reports has he seen about the sector’s prospects for next year?
Hon DAMIEN O’CONNOR: The ASB expects New Zealand commodity prices to continue to push higher over the remainder of 2019 and early 2020. In particular, dairy prices are set to lift over November and December as New Zealand production growth slows and global demand remains firm. In meat markets, we anticipate that prices will remain very high for that extended period, as the impact of African swine fever is likely to persist over 2020 and potentially into 2021. Similarly, we also anticipate that fruit and seafood prices are likely to remain near record highs. The low dollar, the low interest rates, and the high commodity prices mean that there is a very, very good future across all the agricultural sectors.
Kiritapu Allan: What actions is the Government taking to help this sector?
Hon DAMIEN O’CONNOR: We’re doing a lot more than the previous Government ever bothered to do. Firstly, we’re giving certainty to farmers with our recent agreement on agricultural emissions. Our just released skills work plan, developed with the sector, will attract workers—the workers that we require for the future. Our joint efforts with DairyNZ and Beef and Lamb to eradicate M. bovis are progressing really, really well, and, of course, with our $229 million Budget package to support farmers on the ground, through things like catchment management groups, updating Overseer, and boosting extension services—it’s all spectacularly good news.
Question No. 9 to Minister
Hon GERRY BROWNLEE (National—Ilam): I raise a point of order, Mr Speaker. You ruled before that leave couldn’t be sought for the tabling of an electoral expenses return, on the basis that the returns are public. All that is public on the website at the moment is long lists of members’ names, the total expenditure used in the participation in the election by each member, not the detailed returns that have been available publicly in the past. I’d ask you to perhaps consider whether or not that might mean that the return that leave has been sought for, for it to be released, could be sought.
SPEAKER: The answer to that is that I have seen in the last 48 hours publications of—I don’t know if it was a news website or some other website—the type described. If there is a problem with accessing the website for the lower-level donations, then that is something which I will consider at some stage in the future. But I know that they certainly have been available and I know that some of them—because, like other members, I look through the news reports and the linked documents—were certainly available over the last 48 hours.
Hon GERRY BROWNLEE (National—Ilam): I raise a point of order, Mr Speaker. Those sorts of returns have been referenced in the House this afternoon in relation to the National Party by a question from Grant Robertson to Andrew Little. The point is that those returns are not available now. The access to them appears to have been taken down, for whatever reason, and I think it is unreasonable that we are left in a situation where there are allegations against us, because some people have been able to access returns, yet we’re unable to table a return that is dealt with in exactly the same lawful manner.
Hon GRANT ROBERTSON (Minister of Finance): Speaking to the point of order, in this case, having just had a quick look myself, I think Mr Brownlee might be right that they were there and now they’re not available. I suspect what you’ve seen, as many of us have seen, Mr Speaker, are screenshots of what has previously been available. So I’m not sure if that changes your ruling.
SPEAKER: I can’t sort of tell the difference, but if there are screenshots of things which were previously available and the screenshots are available now and it’s got the information, it is publicly available.
Hon GERRY BROWNLEE (National—Ilam): I raise a point of order, Mr Speaker. There are not 120 screenshots of members’ returns. There are selected screenshots that have been used to illustrate some points. There is nothing illegal or wrong with the way in which people like me have accounted for my electoral expenditure. All big donations are declared through the National Party. All we are saying is we would like to be able to table one example of a Labour member’s expense where the same lawful process has been used.
SPEAKER: OK, all right. I think I’ve now got to the point where I am convinced, and, therefore, I am happy to have—I presume in this particular case, it’s a screenshot of an old thing from a website that Dr Smith wanted to table. Is there any objection to that old screenshot being tabled? There appears to be none.
Document, by leave, laid on the Table of the House.
Hon ANDREW LITTLE (Minister of Justice): I raise a point of order, Mr Speaker. I have a copy of returns, and I’m not sure whether they are screenshot copies or whether they’ve come directly from the website, but in light of the previous decision of the House, I seek leave to table the election returns for Chris Bishop, Andrew Falloon, and Lawrence Yule.
SPEAKER: Is there any objection to those being tabled? There appears to be none. They may be tabled.
Documents, by leave, laid on the Table of the House.
Question No. 12—Police
12. BRETT HUDSON (National) to the Minister of Police: What is the number of net new sworn police added to the force, when taking into account attrition, since 26 October 2017, and where have they been deployed?
Hon IAIN LEES-GALLOWAY (Minister for Workplace Relations and Safety) on behalf of the Minister of Police: Thank you, Mr Speaker. On behalf of the Minister, I thank the member for his question, which allows the House to celebrate the graduation today of the 1,825th new police officer since this Government took office. That brings the net number of police officers up by 1,000 since October 2017, which is an 11.3 percent increase in the number of front-line officers. Now, to the second part of the member’s question, Northland gets 96 new cops; Auckland gets 707 new cops; Waikato gets 158; Bay of Plenty, you get 146; central gets 153—
SPEAKER: No, no. Order! [Interruption] Order! I realise that this is not a Government patsy question, but it is going on for too long.
Hon IAIN LEES-GALLOWAY: I raise a point of order, Mr Speaker. This was a primary question set down. The member deserves the full answer.
SPEAKER: Yeah, and I have ruled that the answer is too long.
Brett Hudson: Does he stand by his answer to a written question that on 1 November 2017, just five days after the Government took office, there were 9,016 front-line officers in the force?
Hon IAIN LEES-GALLOWAY: On behalf of the Minister, I’ll have to take the member at his word that that is what the written answer said, and I can only assume that it is correct.
Brett Hudson: What is the number of front-line sworn officers on the force as of today?
Hon IAIN LEES-GALLOWAY: The police constabulary stands at 9,838 officers. That is an increase of more than 11 percent since the start of the 2017-18 financial year.
Kieran McAnulty: In reference to the answer to the primary question, what did other regions receive?
Hon IAIN LEES-GALLOWAY: Oh, thank you very much. The—
SPEAKER: The member may give us two or three examples.
Hon IAIN LEES-GALLOWAY: —eastern region received 61 new police officers, the Wellington region received 200 new police officers, and the Canterbury region received 171 new police officers. I could go on.
Kieran McAnulty: In reference to that answer, does the Minister have any other examples that he can provide the House?
Hon IAIN LEES-GALLOWAY: Just two more: the Tasman district received 24 new police officers, and the southern district received 109 new cops.
Brett Hudson: Given the Minister’s answers, what does 9,838 officers less 9,016 officers equal in the number of front-line officers?
Hon IAIN LEES-GALLOWAY: The difference between those two numbers is what it equals. But the point I would make to the member is that since the beginning of the 2017-18 financial year, there has been an 11 percent increase in the number of front-line police officers to a record total number of 9,838.
Brett Hudson: Shouldn’t the Minister, therefore, thank the National Government for the officers that they delivered while in Government, that he’s now claiming?
Hon IAIN LEES-GALLOWAY: I think what the good people of New Zealand should thank the coalition Government for is the fact that today there are more police officers on the beat, on the front line, than ever before.
Bills
Referendums Framework Bill
In Committee
Debate resumed from 20 November.
Clause 3 (continued)
CHRIS PENK (National—Helensville): Thank you, Mr Chair. Just resuming, obviously, this committee stage of the Referendums Framework Bill—and specifically the repeal section at clause 3. What we’ve looked at previously—and I believe it was last night at the point that we finished the discussion—was around the timing and also the very fact of the need, or disputed proposition that there be a need, for a repeal. I did wonder if the Minister of Justice could comment on the choice of word, actually, to talk about a “repeal” as opposed to an “abatement” or perhaps some other more neutral language that might talk about it no longer having effect, given that, as we’ve already discussed, we’ve seen a situation where, in fact, it’ll be, effectively, null and void in any case. So my question, really, is why it would be that we would formally repeal a piece of legislation that’ll have no meaningful effect after the next general election in any case. So if we could have the Minister sort of provide some further comment on that, that would be very helpful indeed.
Hon ANDREW LITTLE (Minister of Justice): Thank you, Mr Chair. I am somewhat curious about the National Party Opposition’s strategy on this bill, which is to denounce it, to say how horrible it is—“We should never have it; it’s a breach of the constitution.”—and then, in relation to the repeal clause, say “Why have we got a repeal clause?” It would be good if they would make up their minds, but it is there because this bill was conceived for the purposes of the 2020 general election only, and the referendums that this Government plans to run in relation to that general election.
It is clear from the submissions received by the Justice Committee in response to this bill that there are a lot of people saying, “Look, we ought to have a standing referendum frameworks piece of legislation.” I agree with that. I’d like there to be a longer period of time for consideration, both by officials and by the public at large and by Parliament, to do that. This has been conceived for, as I say, that single purpose for the 2020 general election, and I look forward to that member’s support in a future Parliament for the development of a standing referendum frameworks piece of legislation.
A party vote was called for on the question, That clause 3 be agreed to.
Ayes 64
New Zealand Labour 46; New Zealand First 9; Green Party of Aotearoa New Zealand 8; ACT New Zealand 1.
Noes 56
New Zealand National 55; Ross.
Clause 3 agreed to.
A party vote was called for on the question, That Schedule 1 be agreed to.
Ayes 64
New Zealand Labour 46; New Zealand First 9; Green Party of Aotearoa New Zealand 8; ACT New Zealand 1.
Noes 56
New Zealand National 55; Ross.
Schedule 1 agreed to.
A party vote was called for on the question, That Schedule 2 be agreed to.
Ayes 64
New Zealand Labour 46; New Zealand First 9; Green Party of Aotearoa New Zealand 8; ACT New Zealand 1.
Noes 56
New Zealand National 55; Ross.
Schedule 2 agreed to.
Clause 1
A party vote was called for on the question, That clause 1 be agreed to.
Ayes 64
New Zealand Labour 46; New Zealand First 9; Green Party of Aotearoa New Zealand 8; ACT New Zealand 1.
Noes 56
New Zealand National 55; Ross.
Clause 1 agreed to.
Clause 2
A party vote was called for on the question, That clause 2 be agreed to.
Ayes 64
New Zealand Labour 46; New Zealand First 9; Green Party of Aotearoa New Zealand 8; ACT New Zealand 1.
Noes 56
New Zealand National 55; Ross.
Clause 2 agreed to.
House resumed.
The Chairperson reported the Referendums Framework Bill with amendment.
Report adopted.
Bills
Public Service Legislation Bill
First Reading
Hon CHRIS HIPKINS (Minister of State Services): I move, That the Public Service Legislation Bill be now read a first time. I nominate the Governance and Administration Committee to consider the bill. At the appropriate time I intend to move that the bill be reported to the House by 28 April 2020.
The purpose of the bill is to build a more effective and unified Public Service. We live in a rapidly changing world. One could compare the state of our current Public Service legislation with the analogue system. We’ve moved into a digital era, and the legislation that governs the way our Public Service operates needs to be updated in accordance with that. The public’s expectations of what is possible have changed. Their expectations about what can be provided, when it can be provided, and how it can be provided have all changed, and our public services need to be able to keep up with those things.
The overarching aims of the bill are to enable the Public Service to deliver better outcomes and better services; to create a modern, agile, and adaptive Public Service; and to affirm the important constitutional role that the Public Service has in supporting New Zealand’s democratic form of government. To achieve these aims, the bill repeals and replaces the State Sector Act 1988, which was a watershed piece of legislation in its time. It also amends the Public Finance Act to reflect and support the changes that we are making.
We’ve reached the limit of what we can achieve within the confines of the current statute. The State Sector Act is 30 years old. It’s been amended 13 different times, resulting in a law that no longer sets out a clear and consistent vision for the Public Service. It was designed for its time, and since then, of course, there have been major social, economic, and technological changes, and some of those have been on a global scale.
The current Act—the State Sector Act—has provided significant benefits to New Zealand in terms of the efficiency and effectiveness of individual agencies, but it has not served us well when it comes to some of the larger challenges that require Government to act in a more joined-up way. It does not mean—and our work here does not mean—that we believe the New Zealand Public Service is in any way broken; in fact, New Zealanders are incredibly lucky to have a good, robust Public Service that delivers a consistently high standard of service to Government and to New Zealanders. This is about doing even better and about rising to the challenges of the future. It’s also about reconnecting with the spirit of service to the community that is imbued in so many of the people who work in our public services. It’s about unifying the Public Service around a common purpose, principles, and values—principles like political neutrality, free and frank advice, and merit-based appointments, those things that we take for granted but are not currently actually protected in our Public Service legislation.
To achieve these objectives, the bill changes the basic system settings, and it tackles the underlying issues that have increasingly become barriers to progress. It does this by clearly establishing the purpose, the principles, and the values of an apolitical Public Service as well as its role in Government formation. It does this by supporting the Crown in its commitment to its relationships with Māori. It provides a more flexible set of options for how the Public Service can organise itself to better respond to specific priorities, and in doing this, we continue the trend of successive Governments since the original State Sector Act was passed in providing greater flexibility. It allows public servants to move between agencies more easily, and it strengthens leadership across the Public Service, and particularly providing for system and future-focused leadership.
The current Act that we have doesn’t articulate the purpose or the role of the Public Service. Public servants have a vitally important constitutional role in supporting New Zealand’s system of government, which is why the new Act includes incentives to act as a more unified system. The bill states what the purpose, principles, and values of the Public Service are, and it acknowledges that the spirit of service is fundamental to the characteristic of our Public Service. It puts the responsibilities on Public Service chief executives to ensure that the principles of the Public Service are upheld. It allows the commissioner to issue standards and guidance on integrity and conduct. It allows public servants to have the same rights as all other citizens under the New Zealand Bill of Rights Act and the Human Rights Act—for example, the freedom of political expression—and it provides that Crown agents are part of a unified Public Service for some purposes. We have to recognise that we have a number of Crown agents that are delivering what could be regarded as core public services to New Zealanders.
The current Act is silent on the Crown’s relationship with Māori, and that is something we are changing. We’re requiring chief executives to operate as a good employer, recognising the aims and aspirations of Māori, the employment requirements of Māori, and the need for greater involvement of Māori in the Public Service. The bill puts this right. It explicitly recognises the role of the Public Service in supporting the Crown in its relationship with Māori under the Treaty of Waitangi, something that, again, successive Governments have signed future Governments up to a range of new commitments that we will have to uphold and fulfil. So, to carry out this role, Public Service leaders will be responsible for developing and maintaining the capability of the Public Service to engage with Māori and to understand their perspectives.
Under the current Act, each department has got a narrow focus on a particular identity and outputs. Officials are incentivised to focus on their own agency rather than encouraging a wider, more collaborative system approach. In order to address today’s very complex challenges and issues, we need to span agency boundaries in a more collaborative and cohesive Public Service. The bill provides for two new organisational forms within the Public Service, which will help the Public Service act as one when dealing with specific challenges and issues of the day.
Interdepartmental executive boards will consist of groups of chief executives working together towards common outcomes, who are both individually and jointly responsible for that board’s work. The board will have the ability to employ staff, enter contracts, and administer appropriations. Public Service joint ventures will enable joined-up service delivery through vehicles that enable a smaller number of agencies to hold joint resources, including assets and staff and mechanisms to support sustained collaboration by larger numbers of agencies. The bill will allow public servants to move more freely between agencies by providing for the transfer of leave entitlements, and it also provides explicit recognition of the value of diversity, fostering inclusiveness, placing responsibility on chief executives to promote inclusiveness in employment and workplace practices.
Although steps have been made in the right direction to join up the leadership of the Public Service and put emphasis on system and future leadership, the current model for the Public Service emphasises leadership of discrete entities with a focus on short- and medium-term planning. We want to strengthen this system through the bill by requiring the commissioner to establish a Public Service leadership team: a team of Public Service chief executives charged with developing and driving the Public Service strategy for an agile, connected Public Service system—essentially formalising what is a current practice.
It provides for the designation of chief executives as system leaders, responsible for leading and coordinating work on a particular subject matter area across the Public Service—a system that was actually introduced, and I give them credit for this, under the last Government. This formalises that approach.
It allows for the appointment of a second statutory Deputy Commissioner of the State Services Commission, who will have responsibilities to achieve objectives in a designated area, and it requires chief executives, either individually or as a collective representing a sector, to produce long-term insights briefings—something that I think will improve the quality of debate in New Zealand as we make a higher quality of information available leading into an election campaign, rather than providing that information at the conclusion of an election campaign, as we do now.
In summary, this bill will transform the Public Service for the good of New Zealanders. It will make it easier for the Public Service to tackle the biggest issues that challenge the Government of the day. It acknowledges the spirit of service to the community. It enshrines long-held principles and values of the Public Service, such as political neutrality, free and frank advice, and merit-based appointment, and it will have a unifying effect on our public services. These changes will ensure that the Public Service operates with integrity and that it maintains the trust, confidence, and respect of New Zealanders—something we must never take for granted. I commend the bill to the House.
Hon Dr NICK SMITH (National—Nelson): National will be supporting the introduction and referral of the Public Service Legislation Bill to select committee. There is much we support in this bill, in the updating of our legislation that governs our Public Service. There are also areas of which we have some concern and look forward to scrutinising through the select committee process.
I want to firstly say that there is a huge amount about the New Zealand Public Service that is good. It is so important for New Zealand, and when I have—since holding this portfolio—looked at other jurisdictions, our Public Service is politically neutral, and, actually, that is not true for the senior office holders of many of our similar countries. The fact that our public sector has quite high levels of accountability, particularly in terms of expenditure of public money, was pivotal to the State sector reform of 1988. Also in terms of the thousands of New Zealanders who work in our Public Service and are dedicated to providing New Zealanders with first-class public services across so many important areas. I want to acknowledge the important work of Paula Bennett, who was the former State services Minister, who began the review of the 1988 State Sector Act and who, alongside the Rt Hon Bill English, initiated some of the important thinking of trying to get a greater degree of cooperation across Government agencies so that we get over the silo mentality in addressing some of the most challenging social issues that our country faces.
I want to talk about two particular areas where we are supportive of this bill, and then some of the areas of which we have concerns about. The first thing is that we have had situations where a Public Service department has restructured, the employees of that department then go and seek employment in another part of the Public Service, and the State incurs a substantive redundancy bill, even though the person is working for the Public Service the very next day. We think having a more unified approach across the public sector prevents some of those sorts of anomalies that to the average taxpaying and hard-working Kiwi do not make sense.
The second area of which I’ve indicated National is supportive in the new Public Service Legislation Bill is the new mechanisms that are proposed for getting cross-agencies to work more closely together. It is a natural response to the work associated with the Social Investment Agency that National established within the State Services Commission. The new provisions of this bill that we are supportive of will actually enable that sort of model to be expanded.
I want to talk about four areas where we have some concerns about the bill. The first is that pre-1988 we had a very inefficient public sector—the Gliding On programme, or Yes Minister in the UK context, that took the mickey out of just this massive, dysfunctional bureaucracy—
Hon Chris Hipkins: It was a documentary!
Hon Dr NICK SMITH: —was part of—Chris Hipkins interjects that Yes Minister was probably a documentary. I have some sympathy for that view, albeit it really challenges us in looking at this bill to ensure that the elected representatives do retain their authority and their important role in the Public Service.
But my concern is that in the Government provisions around the new principles that apply to the public sector, National is concerned that the importance of that efficiency—that importance of making sure that every dollar of taxpayers’ money is spent wisely within the Public Service—is not there. There are a whole lot of principles of which we agree with about Public Service neutrality, but, actually, one of the really important issues for our Public Service is that they are delivering value for money, and that every dollar that they spend on behalf of New Zealand taxpayers is spent as though that person themselves has had to earn that hard-earned dollar. The world and our own history is littered with examples of where public money is not spent wisely and why that is a really important part of the principles that we want to apply to the public sector.
The second area of which the Parliament has to find a balance is this: what level of flexibility do we provide in legislation for the reorganisation of State departments? Here are the two extremes. You’ve got some Governments around the world where there’s so limited capacity to be able to restructure the public sector that you end up with Government departments that are way out of touch for the changes that do occur in nations. And so I don’t want a very rigid public sector that’s not able to restructure and change with the times. But, equally, we need to be very careful that we don’t continuously turn the Public Service on its head.
I get quite frustrated—having been in the House for some time—that an answer to a public issue is to rename or to reorganise the public sector. It’s sort of the easiest exercise in the book—as if we change the name of the Department of Social Welfare to the Ministry of Social Development. And I could give you another hundred examples of where changing the name and reorganising the department becomes an excuse for, actually, the sort of reforms that will make a difference in New Zealanders’ lives. So Parliament, in this Public Service legislation, needs to provide a balance between enabling State sector agencies to change and be restructured, but not to have it so loose that we have a continuous sort of rolling maul of a Public Service always being reformed and restructured. My first look at this bill is that it goes too far down the road of making it too easy to be able to continuously change the public sector.
The third area in which National has some concerns about this bill is around the accountability of chief executives and those that work in the public sector, because here’s the trade-off. If we go pre-1988, in the old State Sector Act 1962, if there was some sort of a mess or appalling failure within the public sector, everybody ducked for cover. There were no clear lines of accountability and, in my view, that made for a weaker Public Service. You do need to have agencies that have very clear objectives. You need to have a clear chief executive who is in charge of that agency for delivering value for money for the public sector but also delivering the important outcomes that this Parliament has charged that agency with.
Our concern in respect of this bill is that that accountability is being blurred, and there is a trade-off, because if you want to provide the greater flexibility of agencies being able to work together, that is a good thing, but if it turns into everybody being involved and nobody being accountable, actually, the quality of the public services that New Zealanders have will be worse off. That is why National wishes to retain the strong public sector accountability that, in my view, was a very substantive improvement on the pre-1988 State Sector Act. We worry that in the provisions of this bill—of sort of creating everybody doing everything, holding hands together, and singing “Kumbaya”—we lose the focus and the accountability that actually is important to getting results.
The last point I want to note is a concern about the shortened report-back time that the Minister has signalled. We need to recognise that, actually, the legislation that governs the organisation and the management of our Public Service is incredibly important. We are talking about agencies that expend over $80 billion every single year. We are talking about an Act that was last reformed 30 years ago, and it is likely that this Act will, hopefully, serve our country for the next 30 years. A good period of the time between now and 28 April actually is the holidays. We think there is no justification, for such an important bill, for the shortened report-back period. The Government has been mulling over these issues for over two years. It’s not unreasonable on such a large bill with such huge public significance for Parliament to be able to have the normal six-month process. The Parliament should not have to pay for the Minister meeting a slower timetable than he had set out around the introduction of this bill, and so we would wish the Government to reconsider about the shortened report-back period.
Hon GRANT ROBERTSON (Minister of Finance): It’s my great pleasure to rise in support of this bill, and I want to start by paying tribute to my colleague and friend the Hon Chris Hipkins. This has been a very large piece of work, and—in reference to the member Dr Nick Smith’s comments that he’s just made—it’s one that’s already had extensive consultation.
I think Minister Hipkins would have been about the same age as the pupils from Akaroa who are up in the gallery today when the 1988 bill was passed. I think he might have submitted on it, even at that point, such is his interest in the State sector. But what Minister Hipkins has brought to the House today I regard to be one of the most significant legislative changes that we’ll be making in this term of Government. It is the complete rewrite and modernisation of our State Sector Act, and Minister Hipkins deserves a lot of credit for the work that he has done here.
Equally, as he himself noted in his speech, there have been changes to the State Sector Act over the years, including by the last Government, and some of those actually have been particularly useful for being able to make advances on what I regard as the core issue that lie behind this bill—that is, the ability to break down the silos of Government. All MPs will know that as we travel around the country, one of the things that is raised consistently with us is the issue of the siloing of Government. When people—as Minister Hipkins is fond of saying—wake up in the morning, they don’t think to themselves “I’m going to deal with the Ministry of Social Development, followed by the Ministry of Health, followed by Work and Income, followed by Oranga Tamariki.”; they think about their interactions with the Government, and what we need to do is create a Public Service system that responds to that.
Now, I want to be clear: there were some excellent things that occurred as a result of the 1988 legislation, and my particular area of interest here comes from its companion legislation, the Public Finance Act (PFA), which was passed the following year. Those two pieces of legislation did bring a lot more sharpness in the focus around accountability and, in particular, in terms of the PFA, around expenditure accountability and authorisation but also around the State Sector Act, around transparency of objective-setting within Government, who was responsible for what—clear lines of accountability and reporting. Those are good attributes of the State sector legislation, and we want to maintain those.
However, where the State Sector Act has proved to be inadequate, and, indeed, in some cases beyond inadequate to actually being obstructive, is in trying to meet the complex challenges of the world that we face today. If we want to address issues like climate change or like inequality, then we have to have a more joined-up Public Service. We have to have a Public Service whose objectives are clearly focused on those outcomes, rather than on the inputs that each agency might put in place.
This came into stark relief for this Government when we tried to do something different when it came to the elimination of domestic and sexual violence. Now, again, previous Governments had undertaken coordinated work in that area, but it wasn’t fulfilling, I don’t think, what any of us would want in terms of the objectives that we have around the elimination of that scourge in our society. So the Government set about putting together a single organisation or entity that comprised of eight different Government organisations to work together towards one set of goals and one set of outcomes, and that’s the work that Jan Logie has led as Parliamentary Under-Secretary to the Minister of Justice, and she’s led it tremendously well.
But, just as an example to highlight the difficulty in doing this, when we came to do this, there was no name for the entity. We couldn’t find anything inside the Public Service system that we could call it. We ended up calling it a joint venture because, I guess, that’s what it is. It’s a joint venture of eight different Government agencies and there are parallel NGO bodies that work with it, but that, to me, is a symbolic example of the fact that the system and the organisation and the legislation is not currently facilitating agencies working together on that way. So, as Minister Hipkins has already said, the legislation actually now allows for those forms to be properly recognised and to be supported by a structure that actually incentivises agencies to get in there and help solve those complex, multifaceted issues.
Through this bill that’s in front of the House today, we’ll make some further amendments to the Public Finance Act to support this. Essentially, what that means is that these new organisational forms like the joint venture will have the ability to administer appropriations and report against any assets and liabilities that they may manage on behalf of the Crown. That is important, because right now, if you go to the Government accounts and go looking for the joint venture on the elimination of domestic and sexual violence, you won’t find it. You will find it in eight different appropriations, and that just doesn’t make sense and it acts as a barrier to cooperation and collaboration.
So that change, facilitated through this bill, is, I believe, a significant and important one in allowing the Government to get on with the job of meeting the expectations of citizens around how their public services will work together and that they will be focused on the outcomes that they desire. So those changes are important. I want to reiterate we have kept in place within the Public Finance Act and, indeed, within the State Sector Act that clarity of role and clarity of accountability that the 1988 Act brought, but we are opening up some more flexibility for how that can be delivered in order to do it in a more coherent way.
Beyond that, I believe that Minister Hipkins has outlined in some detail what he’s been trying to do here. This is, effectively, to my mind, a significant modernisation of our legislation in an area where that’s been needed, and—Minister Hipkins has mentioned it—that is around the way that the Public Service thinks about issues related to Māori. It’s fair to say that, probably, in 1988, we were just at the point where those issues were becoming more prominent, and it’s timely, 31 years on, to be able to say that, actually, in a cross-party way across this House, we share an understanding of the importance of the relationship between the Crown and Māori, and we need to reflect that in our Public Service legislation. So the clauses in this bill that go in that direction are important, and they reflect, I think, where modern New Zealand sits today.
The other point I’d just like to make—and it’s to pick up on the comments made by former Minister Nick Smith—is around what actually is meaningful change in the Public Service. It is absolutely true to say that the system we have at the moment means that we have entities that are created not necessarily for the best reasons. Former Minister Smith used the example of the Ministry of Social Welfare. I would use the example of the Ministry of Business, Innovation and Employment (MBIE). I don’t believe the creation of MBIE was actually built on how the agency should best work together; I think it was built on how Steven Joyce wanted to build an empire. It has ended up—I have to say—as a fairly unwieldy entity, although it’s being well managed at this point in time. But we do actually need to make sure that the way we organise the Public Service is based around the outcomes that we want and the expectations of New Zealanders.
I want to just make a slightly longer reference to the point that I made at the very beginning of my speech around the report-back time for this bill. This is a piece of legislation—and the policy principles within it—that has been extensively discussed since we came into Government. There has been significant consultation, including with the Opposition, which is as is appropriate, and I do believe that the report-back time that the Minister has put in place is the correct one. We have heard from a lot of stakeholders, both inside the Public Service and outside of it, that they want us to get on with the job when it comes to this kind of legislation. We’ve done a lot of talking. We’ve done a lot of consulting. The issues are clear. I look forward to the select committee process and the feedback that we’ll get in there, but, actually, this is an issue where we have done enough work to be able to just get on with the job and make sure that we get some legislation back before us within a few months’ time.
So I am very pleased that this bill is before the House today. I think it represents, for this Government, the kind of legislation we want to put forward: one that emphasises the importance of collaboration within our public sector; that emphasises the importance of public services being responsive to the needs and interests of our community; that emphasises our commitment to making sure that Te Ao Māori, the Māori world view, is understood and is part of how our Public Service operates.
I also want to finish on a final point, and that is to say that despite the fact that this legislation is significantly changing the way we organise the public sector, it is by no means any kind of statement against the public servants who serve us today. We are incredibly well-served in New Zealand by our Public Service, who act without fear or favour—whomever the Government is—in the best interests of the people of New Zealand. We should be incredibly proud of our Public Service. Today we’ve talked a little bit about where we stand in the Transparency International ratings and where we stand in the ease of doing business ratings in the world. A lot of that is down to the hard work and the ethics of our Public Service. They deserve our congratulations. This piece of legislation will support them in everything that they do. I commend the bill to the House.
Hon JUDITH COLLINS (National—Papakura): Thank you, Mr Speaker. It sounds awfully as though peace has broken out. I’m sure it’s a good—
Hon Grant Robertson: Ha, ha! It won’t last.
Hon Chris Hipkins: It won’t last.
Hon JUDITH COLLINS: There’s no chance of it lasting that long, but it might last out for this bill. Anyway, I’d like to echo a few of the words, particularly of my colleague on this side of the House, regarding the political neutrality of the Public Service and how important that is. I think many of us know that the—let’s take the US federal system, where a new President comes in and 5,000 senior public servants lose their job that day. That’s not possibly a system—not that I’m ever about to criticise other countries’ systems—that’s going to embolden someone to be politically neutral when they’re making decisions. I think it makes it very difficult for those who work in the levels under those 5,000 to maintain any sense of political neutrality when they have that sort of situation happening. That’s just simply that our Public Service has moved on over the years in a slightly different way from some other countries.
There has been an awful lot of talk about the excellent work of the Public Service, and my experience as a former Minister has been that I have been consistently impressed by the decency, the hard work, and the commitment to fulfilling Government priorities over the years, in almost every case. I think when I look—and that’s probably like my colleague, the former Minister Nick Smith—at when we can have, actually, good, friendly relations with people who now serve another Government, that’s a very good indication as to the strength of the political neutrality, that there is, in fact, no patronage, no appointments to the senior Public Service based on, you know, political parties or personal friendships.
I think one of the things that I would like to say is that it has not always been quite like that. It may shatter the general peace that’s broken out, but I do want to acknowledge that a former chief executive Christine Rankin was extraordinarily badly treated by an Opposition in the 1990s. I think one of the things that we should always think about is that these public servants, who do the jobs that we as either former Ministers or Ministers ask them to do, have an accountability to try and do their best to follow Government policies and to do their best to do so. It’s not OK to take them aside and to take them apart, frankly, in a public way. That happened to Mrs Rankin.
When we look at working across agencies, the big issue is always around budgets, actually, and also priorities for those particular agencies. Certainly, when we were in Government, we brought in, in the justice sector, a working arrangement between the Ministers of Justice, Police, Corrections, and the Attorney-General. I’m not sure that the current Government does that, but we certainly found that a very useful way so that we could actually encourage—because our Ministers worked together—the chief executives to work together accordingly. That reached its pinnacle, really, frankly, in the Justice Sector Fund. That was a fund that each of those agencies—and certainly the Crown Law Office never had much to give in, I must say—could put any money that they hadn’t used from their last budgets in together so that other agencies could use that, those other agencies being in the justice sector. That was all around bringing down crime, which we had some very good success with, and also about looking at innovation.
Trying to get any innovative actions through the Public Service processes, particularly around Treasury, can be quite difficult, and so sometimes it needed something that we could actually try without having to prove it would already work, which is really hard with innovation. It’s very hard to prove it will work when you haven’t actually tried it. So we found that very useful.
I think too, though, that there needs to be another issue that we deal with in the select committee, and that will be the issue of accountability. It is very easy to say, “Well, we’ve all got to hold hands and work together in the Public Service. We’ll all just, you know, be happy with a common goal.” It is difficult to do that when someone is the chief executive of an agency and that agency then has to be held accountable for its performance, which is where targets actually are quite useful. It is important with that that the Government and the Parliament itself in the select committee looks at this and says, “So how do we have a situation where everyone can work together for the common goal? But, by the way, we want to make sure we can hold agencies accountable to do their part.” I do always have a little concern with all this holding hands and singing “Kumbaya” together, that we make sure that agencies do have accountability, because you can end up with situations where everyone is accountable, which means nobody is accountable. That’s the problem. So that’s going to be really interesting, teasing that out in select committee. I think that’s one of the issues we see with attempts that have been made in the past. It’s going to be really important that that accountability function is robust.
So, in general, we support this bill going to select committee. The Opposition will be taking a very constructive and helpful role in this. I think it’s something that we can all agree on. We can be proud of our Public Service, but we can also be awake to the fact that times change, technology changes, needs change, and there’s nothing wrong with being able to look to the future as well.
MARK PATTERSON (NZ First): I rise on behalf of New Zealand First to add our support to this Public Service Legislation Bill, and a fairly substantive bill it is too—190-odd pages. I commend Minister Hipkins for bringing this forward—a very busy Minister. I note I’m on the Education and Workforce Committee, and there are waves of legislation coming before us. It might suggest you need a hobby, Minister. But no, this is—
Hon Chris Hipkins: This is it!
MARK PATTERSON: —a substantive—ha, ha! Unfortunately, it may be for you. So we’ve heard the importance, of course, of the Public Service as the foundation stone of good, effective, and efficient Government, and, you know, the three tenets of this bill: creating a modern, agile, adapted Public Service; affirmation of the constitutional role; and the democratic imperative of it being apolitical. And I think that is the strength of our democracy, and, also, I think, for continuity, particularly if you’ve got a change of Government, if you’ve got that institutional knowledge that comes with it and is able to come with it without fear or favour, I think that’s incredibly important in terms of the continuity of good Government through electoral cycles.
I note that it repeals and replaces the State Sector Act 1988 and amends the Public Finance Act. The State services Act seems to have been amended some 13 times, which does mean that it is now quite convoluted. It does add a degree of flexibility which appears, at face value, to make a lot of common sense for staff to be able to move easily between agencies and to cross-pollinate their ideas. Of course, technology and systems development has moved on a lot from 1988, and it’s how do we utilise that for the efficient delivery of public services—this bill does provide the framework for that to happen more readily across the various Government services.
Actually, the four previous speakers, I note, have been former or current Ministers, and they have sung the praises of the quality of our Public Service that they have up to their level of experience. As a relatively new member, I must say that I’m constantly blown away by the quality and the depth of experience that we’re able to call upon within our Public Service. I guess coming into this, my perception was around that Yes Minister model where befuddled politicians were bamboozled by clever public servants who actually ran the Government. I’m not sure that that’s totally the case, but you can see that we as politicians do have to be on our game where we do have to be able to put up arguments against very well resourced and capable public servants who have, in the main, or, I’m sure, exclusively, New Zealand’s best interests at heart.
I note that this legislation also does look to update the Crown-Māori relationship and Treaty of Waitangi issues, and, of course, that’s appropriate. It’s important that that’s consistent across Government.
There are two new organisations formed with this. The interdepartmental board, where CEOs can work together, and it does have some capacity to employ staff, so that appears, at face value, to be a positive step. And the mechanism for Public Service joint ventures, so there’s the ability for joined-up Public Service delivery, and others have referenced this in their contributions. It requires the State Services Commissioner to establish a leadership team and it establishes a role of a Deputy State Services Commissioner.
Increasingly, we are, as a Government, facing significant, large, multigenerational public policy issues—and we had, of course, the zero carbon bill go through the other day—and, referenced also earlier, how we deal with intergenerational poverty and large social issues like that. And having joined-up mechanisms to deal with that outside of those silos will be incredibly important to modernise our public services so that we can respond in a nature that is proportionate with the scale of the problems that we’re dealing with. Even within my own sphere, in the agriculture sphere, I had, just before coming into the House, a meeting with a group of high-country farmers in terms of tenure review and issues around that. While ostensibly you would think that was a Ministry for Primary Industries issue, it’s actually a conservation department issue, a Land Information New Zealand issue. More and more we’re looking, when we talk about the agricultural space, with an environmental lens over it. So we need to make sure that we do have the ability to respond as a Government and that our Public Service has the mechanisms in place to be able to respond in a joined-up manner to those multifaceted issues that we are increasingly facing.
So I look forward to the progress of this bill through the select committee. It is a substantive piece of legislation, and they will have some work to do to make sure that it comes out the other end as intended, to make it the positive step forward to futureproof our Public Service, hopefully, for the next 30 years, as the previous legislation has done in the past. So, without further ado, I commend this bill to the select committee on behalf of New Zealand First. Thank you.
IAN McKELVIE (National—Rangitīkei): Thank you, Madam Speaker. Needless to say, we support this bill to the select committee. During the 18-odd years that I’ve been floating around in public life, you come to realise pretty quickly the value of the Public Service in whatever form it takes. I think it’s essential that we have a very strong Public Service, not the least reason of which is to make sure that when we elect various people to positions of power, the Public Service is there to control them. It’s not such a bad thing at times, because it’s necessary—and you certainly see that in local government. The Public Service is hugely important to us in New Zealand, and I, like the previous speakers, have great admiration for them.
I did want to come at this from a slightly different angle though, because it’s interesting—with the exception of my cricketing colleague, and I note that England are under a bit of pressure today again—all the speakers that we’ve heard from have been Ministers. You have a very different perspective of the Public Service as a Minister than you do as a backbencher in this place. I suppose I just wanted to issue a ward of worming—that was an interesting term, wasn’t it?—a word of warning to those backbenchers amongst us who have a penchant for attacking members of the Public Service when they come before select committees: you’ve got to remember that one day you might be on the other side of the fence, and the Public Service will take a very different view of you. I think it is something that people tend to forget in this place, and I’ve seen one or two of our current members of Parliament have that problem.
This Act replaces the State Sector Act that was put in place somewhere in the 1980s. As we’ve seen recently again in this Parliament, things that have been around 30-odd years or more do tend to date a bit. I think it’s necessary that it is brought up to date—and, I guess, I think the changes are positive.
I did want to touch on one change that I think is going to be tricky to deal with, and that’s—and I know the terminology is very general at the moment—where it talks about forming boards of State sector chief executives. I think those State sector chief executives are going to come to those boards with the best of intentions but they’re going to find themselves, from time to time, compromised. I think we’ve seen this on all sorts of boards that I’ve been around in my lifetime, where you have representatives of a group on a board, it’s very difficult to then become part of the whole and represent and take back to the bit of the whole the pieces that are important to make the whole work. I think that’s going to be very testing. I admire the aspiration of it, because I do think it’s good. But I do think it’s going to be very tempting to get that to work as it’s intended. I hope it does work, because I think, if it does, it will add a whole lot of value to what we’re trying to do here as parliamentarians.
A couple of other things that interest me as well are that it mentions in the course of this legislation the ability to restructure—or rationalise the nature of our district and regional branches and the boundaries that apply to them—of some of our State sector organisations. That really interests me, particularly in the Rangitīkei, because when you go to Taumarunui, you go out of Taumarunui for health to the Waikato, for social services to New Plymouth, for the police to Whanganui, for the regional council to Palmerston North, and, blow me down, you’ve got to go to Taupō to do your shopping. It’s extremely complicated and very confusing for people that live in those parts of rural New Zealand. We don’t realise in this place quite the challenges that they have, and I’m sure that the State sector departments have, in delivering a joined-up service or structure to those smaller communities that are more isolated in New Zealand. So I hope that that’s able to come out of this bill and work as well as it works—obviously, in built-up areas and cities, it’s much easier to operate these services, and I think they work differently, in my experience, in cities than they do in the regions, but none the less, it’s important.
There was one other thing that intrigued me about this, which was that in the build-up to it, and in some of the work that’s been done before, it talked about a lack of public interface in this bill. Well, the State services have a massive influence on what happens to us as people, and there might not necessarily be much public interface between the Public Service and what happens in Parliament, but what they do is hugely important because it impacts everyone in New Zealand and it impacts on all of our lives in some form or other. So it’s very important that members of the public peruse this bill and make sure that when it finally comes out for its third reading, or ends up in its third reading and comes out as law, it’s actually in a form that’s going to work for the rest of New Zealand. I think that’s very important, and I think it’s important that the people of New Zealand understand how the system works and why it’s established to work in the manner it does.
It’s no small piece of legislation. It’s a very important piece of legislation, and it will, I think, come in for quite a lot of scrutiny at select committee, even though it is operating under a shortened time frame.
So I look forward to the progress of this bill. I admire, I guess, the idea of it, and the thought that’s gone into putting it together, and I’m sure it will get great scrutiny, as I’ve said, and come out the other end in good shape. Thank you, Madam Speaker.
GARETH HUGHES (Green): Kia ora, Madam Speaker. Ngā mihi nui ki a koutou. Kia ora. I rise on behalf of the Green Party to support this legislation. I acknowledge the Minister, Chris Hipkins, who’s done a good job to get it to this point in the House, and the team behind it.
It’s always interesting to follow the member Ian McKelvie in his contributions. I think he’s quite an erudite member and brings down that real home experience to the debates in Parliament. I guess, two reflections: I found it quite interesting, the diversity of interactions that, say, someone in Taumarunui would have to have with New Plymouth and Palmerston North and a host of other centres. You wouldn’t design a system like that, would you? But that’s the system we have today. Also, his reflection around the interface of backbench members with the public sector. Now, it’s been one of, I think, the privileges of the Green Party, in our first opportunity to be in Government, to actually work much more closely with the public sector and public servants. I wonder if this is an opportunity for the House to actually encourage members of Opposition parties who haven’t had the privilege to be a Minister to have more ability to interface with who I believe—and I echo the sentiments of other members in the House—are incredibly dedicated, hard-working individuals. The old Roger Hall Glide Time cliché is well left in the past. These are high-quality public servants with the national interest at heart. Instead of just the two, maybe, interactions a year in select committee with annual reviews or, potentially, Estimates, I think we should encourage that, because these are the Ministers who will be working with them in the future.
I’d like to acknowledge the public servants in New Zealand. My father worked for the IRD for many, many years, so I saw it from that perspective. He always had the joke “It was a taxing job”, which he used at every single barbecue and Christmas. Now, he, alongside his colleagues, worked incredibly hard, but his career with IRD was in the wake of the big reforms of the 1980s, and, of course, our State Sector Act dates from 1988. I was seven years old at the time. This is something that is high due for reform and modernisation.
This, I think you can quite easily say, is one of the largest reforms to the public sector in New Zealand’s history, and I think it should be commended for its scope, for the scale, and for the intentions behind it. Every single issue that we have in New Zealand, be it swimmable rivers or climate change or transport or housing, has a Public Service dimension, and New Zealanders have to interface with the public sector many times across their lifetime, so we want to have a service which lives up to the high-quality expectations of New Zealanders. If we’re going to tackle some of these long-term systemic problems, we need a high-performing, agile, innovative public sector.
Three areas I’d like to touch on in particular. The first, I guess, is the structural, and while acknowledging this isn’t the most sexiest topic to be discussing, it is the foundation of a well-functioning democracy. I think many of our positive attributes as a country—and many other countries do look at New Zealand with a jealous eye—have come down to the Public Service, the apolitical nature of them, the fact of our low levels of corruption, high levels of integrity; again, not the sexiest topics to be debating, but fundamental for a functioning society. It’s something I’ve only really appreciated with the privilege of being an MP and interacting with so many people across my career. So establishing the values, the principles, and the purposes of an apolitical public sector is crucial in this large legislation.
Now, the second major area—and this is where I think the innovative aspect comes in—is changing the way that the 1988 Act provided for Government structures. Now, by allowing departments, that was very much par for the course with governance thinking of that time. However, what we’ve wanted and the public have demanded is the ability for the Public Service and the Government not to think in silos, not to just think of something as a discrete box that maybe on the margins interacts with other areas of Government department; they just want to see joined-up thinking. They don’t care about the structure of the body providing the advice or the service. They just want to make sure there’s good advice or a good service being provided. So the ability to reform this to add other structural categories from interdepartmental executive boards, to bring those heads together through interdepartmental ventures, to actually deliver those services, I think is a positive innovation.
I wasn’t aware that the 1988 legislation was silent on the Treaty of Waitangi. I think that shows the date and the genesis of that legislation. So I’m glad that is being included in this new legislation at the moment. From a Green Party perspective, you know, it’s something we’ve really urged Parliament to consider, actually taking that further so that this legislation actually gives effect to the Treaty of Waitangi, our foundational document, the heart of our modern constitutional relationship. So that’s something we’d like to see strengthened.
Now, this is the point where the public gets their say. I note it is a shortened select committee, but I do urge the public to have their say, because everything they care about—from rivers to transport to roads to climate change to jobs—has an impact on this legislation. So please, I urge them to have their say. Kia ora koutou.
ANDREW BAYLY (National—Hunua): Thank you, Madam Speaker. It’s a pleasure to be talking on the Public Service Legislation Bill. I just want to start by saying the New Zealand public sector is normally regarded as being top-notch, one of the best in the world. So I think, in that context, we should be looking at what this bill is seeking to achieve, which is a further improvement to make sure that our Government entities are the best that they can be. I think we’re all aware of the need to be able to have multiple entities working together to achieve a better and a more holistic outcome. We were certainly trying it and doing it when we were in Government, and, obviously, this bill is another way of furthering that intent.
I think sometimes we have missed out on the opportunity. A case in point: often when we are building a hospital—and Dunedin is an example of that; we’ve got a major hospital spend under way—I think in many cases, a lot of Government entities will regard that as a project in itself, which is to build a new medical facility at substantial cost, and that’s fine, and it needs to meet the needs of health and medical needs of New Zealanders going forward. But those sort of projects have the ability to offer much more than that. They could offer roading advantages and what that might mean—how a city layout is configured after the construction of the hospital. It might have an element of Housing New Zealand, where new houses are built. All those sort of wider economic projects and context, which often also have a council overlay, are an opportunity to actually achieve much wider outcomes rather than purely delivering a new hospital. I think this is the type of legislation that might help in achieving those sort of outcomes.
So in that regard, obviously, we are very supportive of it. We certainly have tried to do it ourselves. I think the ability to look at appointing leaders who will be appointed for their skills in functional leadership is another aspect that’s quite different, and I think to administer funding and employ people on a cross, sort of, service or functional lines is an additional element which is provided for in this bill.
But I think there are a couple of things we’re concerned about in the bill, and one is that there are times when certain entities will want to be very commercial in their approach. They won’t want to be fettered or, in fact, inhibited in making quick decisions and moving quickly, and I think there is a line that needs to be drawn about when that might take place—and also some of the provisions around the collective employment provisions, which, no doubt, will be thrashed out in the select committee. But I think, in general, I’m looking forward to seeing this come through to the Governance and Administration Committee. It’s an interesting concept. It also does raise the issue not only about how State services and public services are organised but also how Ministers are organised to actually manage this new type of entity.
But the last thing I would say is I think it’s a shame that this piece of legislation has been brought to the House so late in this parliamentary cycle and, consequently, there is a rush to see it pushed through the consultation process. I think that’s slightly unfortunate because it’s more worthy than that, and, certainly, hopefully, the select committee gets a good opportunity to assess it and to make some further recommendations. Thank you very much.
DEPUTY SPEAKER: This is a split call.
JAMIE STRANGE (Labour): Madam Speaker, thank you for the opportunity to take a call on the Public Service Legislation Bill. I’d also like to begin by acknowledging the Minister, the Hon Chris Hipkins, for bringing this bill to the House. I have heard him speak a number of times around the Public Service sector working closer together, rather than working in silos—coming together and, basically, working together, which certainly makes it better for the members of the public.
I’d like to begin by just sort of outlining a story that I’m sure many of us have heard from constituents who have been to our offices. The story goes like this: if somebody has a certain need they may contact an agency—for example, Work and Income. They will give all their details to Work and Income, and they’ll work through a process with Work and Income. Then, they would need to get in touch with Housing New Zealand on a related issue to their conversation with Work and Income. When they get to Housing New Zealand, they’ll have to relitigate all the information that they’ve given to Work and Income. Then they may need to talk to the IRD, or there might be an ACC aspect. And we’re talking about a person’s life here that has a number of different aspects to it, and if that person needs to engage with a number of agencies around different aspects of their life, it’s much more helpful and much more better—well, it’s much better for that person if the agencies are working together, particularly on the information they have.
So the first point I’d like to highlight is the aspect of how this bill unifies the public sector—having them working together rather than working in silos. The important aspect here is that this Government is taking a collective approach to our public sector. Rather than looking at one aspect of the public sector here and another aspect over here, we’re looking at it as a whole and at how can the public sector serve New Zealanders.
There was an excellent example last year of the public sector working together in the Wellbeing Budget, where we had 10 agencies that worked together on the family violence and sexual violence aspect of the Budget. It was called a joint venture. The agencies worked together to put their Budget bids in, and they are now working together to administer the money that was provided from that successful Budget bid. So this piece of legislation basically looks to embed that philosophy of the agencies working together.
The second point I’d like to raise is that I’d like to thank the public servants for the work they did. Last year, the Government instituted core State sector public servants receiving at least a living wage of $20.55. But the aspect is around future-focused leadership. We live in a world that’s constantly changing—it’s constantly evolving. Services are moving to an online model at times, but the question is: how can we provide a high level of service that at times may not be face to face? Now, I know for a lot of people they do prefer face to face, but we do have the aspect of online available to us. But how can the agencies work together to deliver a service that is diverse and that reaches a wide range of people, whether those people be urban or whether those people be rural? And future-focused leadership is important in this area, and leadership from all the agencies working together to provide that service.
I also was not aware—as the Green member, Gareth Hughes, said—that the 1988 legislation of the Public Service did not mention at all the Treaty of Waitangi. So I am also very pleased to see that the Treaty of Waitangi is embedded in this legislation, and that there is a focus on greater involvement of Māori in the Public Service, and also recognition of the Treaty of Waitangi as our founding document in everything that the Public Service does.
Just a couple of other quick points—this legislation allows public servants to move between agencies more easily. That links to the aspect around a de-silo—if that is a word—removing the silos that have existed; a wedding of the agencies so that people can move between the agencies. And I think that’s an excellent thing, because people will take experience from one agency to another agency and vice versa, from one agency to another. And people will be rubbing shoulders with people from different agencies and basically having a common understanding. So, an excellent piece of legislation; I’d like to commend the Minister and commend this bill to the House.
Dr JIAN YANG (National): I rise to speak briefly on the Public Service Legislation Bill. Now, the State Sector Act of 1988 has played a significant role in the past 30 years in regulating the Public Service sector. We now have a Public Service sector with an outstanding international reputation. But, nevertheless, over 30 years many things have changed, so I would like to go through some of these changes.
First of all, we have witnessed a change in our demography. Over the past 30 years, the population in New Zealand has changed substantially. We now have a much more diverse society, including the Chinese community—a much larger Chinese community in New Zealand. So with the change of population, we have a change of culture, so we now have a multicultural society. So this change means that we need to somehow reflect in our Public Service sector to reflect multiculturalism in New Zealand, so we need a more diverse public sector.
A second change—technological change. The change of technology in the past 30 years, we can see, is really extraordinary in our human history. Now, of course, we have digitisation, we have modern communication, and we also have artificial intelligence. All these are now being used in our Public Service. And, therefore, we need, somehow, to catch up, to make sure we are able to use our modern technology more efficiently.
And thirdly, with a change of modern society and demography, old values have changed. For example, we now have a stronger sense of human rights, stronger sense of gender equality, transparency, and ethnic equality. Again, our Public Service sector should reflect modern values.
With all these changes we also look at best practices. So we have seen the changes of best practice globally. We believe a unified Public Service is now best practice, and we need to have a cooperative approach with collective responsibility to tackle New Zealand’s big challenges. And, of course, the public now have different expectations—for example, they now expect a more efficient, more transparent, more diverse, more inclusive Public Service sector with a better gender balance.
Finally, we see that the structure of the Public Service sector also has changed. For example, we now have more agencies like ACC, New Zealand Qualifications Authority, New Zealand Transport Agency, Housing New Zealand, so these new agencies should be regulated. So I support this bill and refer it to the Governance and Administration Committee, with the aim of creating a modern, more agile and adaptable Public Service. Thank you.
PAUL EAGLE (Labour—Rongotai): Thank you, Madam Speaker. It’s a real pleasure to have the opportunity to talk about this bill; I rushed into the House because it’s important that I do, considering I am the member for Rongotai, including the mighty Chatham Islands.
When I look at my seat and the coverage of it, being a third of the city, it is, can I say, the home of public servants. It’s at least one-third of the city where many, many, many of the workers who live there work in some way for some entity as part of something, but when you talk to them, sooner or later you find out that they are actually working for the Public Service. I want to congratulate all of those who have put in work, but in particular, the leadership of the Minister, Chris Hipkins, because this has been a piece of work that’s a long time coming. And I know, when I look up into the crowd here, I see some young people from Te Kao—nau mai, haere mai, welcome.
But I was recently talking to someone in Kilbirnie, actually, who said that they had come from the provinces and made the transition to work in a big city like Wellington for the Public Service. I thought that was something that they had always aspired to because their relations had worked historically for the Ministry of Works and in other local agencies, and to be given the opportunity to come to the capital and work for the head office—for want of a better term—was a real privilege to do that. So kia ora to the whānau up there.
The one thing I really like, though, is the flexibility around what’s being proposed here, because what this does—and I learnt this in local government too—is sometimes you have a set of goals or visions or pieces of work that need to be done and the structure of the service delivery agents don’t go hand in hand; what’s being proposed here is that you can now bring people together from those agencies. I heard the Minister of Finance, Grant Robertson, talking about this: it breaks down those silos.
So I can see why the Opposition is supporting it, because they too know that when it comes to delivering on the promise, whatever that may be, you need a group of the very best people. Sometimes that means getting those from across the Public Service, regardless of entity. When you look at the structure, be it a ministry, a Crown entity, a State-owned enterprise, an independent Crown enterprise, and the like, you just want the very best people to ensure that they deliver the project.
We are in the year of delivery, the party of delivery, and so this is all part of that vision to ensure that the goods get delivered and the people of Aotearoa New Zealand ultimately benefit from the policies and visions that we’ve put in place. So, in terms of tackling those long-term challenges, putting in place things, it may take much more than just three years—maybe 30—but this is part of that structure of a Public Service.
Can I say, too, how proud people have been. They know this is coming. Some have worked on it, and they have said, “It’s great that we are now able to move more easily between agencies.” I am hopeful that that will extend to, say, their leave. I know some agencies have got it sorted. I know that within the police service, you can work across the many divisions and branches within that entity and you take with you your entitlements. I guess that’s important because it gives people hope and it also means that they feel valued, because often they may not get the credit for some of the work that they do because they’ve had to make a sudden transition or there’s been some restructure solely to deliver the project that they’ve been working on.
I know others want to talk about the commitment and relationship with Māori, and that’s being talked about too. That’s important because we are seeing a Public Service that is embracing things Māori. It’s taken 30 years, dare I say it, since the State Sector Act was put in place all that time ago. But it is relevant; it is timely. It’s well overdue, dare I say it. But what we do have now is it is enshrined where things will be considered and not just an afterthought. I commend this to the House.
LAWRENCE YULE (National—Tukituki): It’s my pleasure to take a relatively short call on this bill. This is a big step forward. I want to acknowledge the Hon Paula Bennett, and yourself, Madam Chair, and your Cabinet colleagues, who formed this view that the public sector needed to be reorganised and structured in a better way to work together. I absolutely believe that this is the right thing to do, and our party and this side of the House is prepared to support it because what it does is it futureproofs the Public Service and the way it operates.
I know in previous roles I’ve had, I’ve often seen silos of one department, another department, and another department. They won’t always talk. Many of them won’t work together, and often—and I acknowledge the Minister the Hon Nanaia Mahuta in the Chamber today—in the local government world, local authorities are trying to work with various Government departments, and it’s not always easy. So, I think any structure that gives leadership and the ability for Government agencies to work together more collaboratively and in a different way than they have in the past is a good thing.
I like this bill because it states the purpose, principles, and values of the Public Service but also talks about the responsibilities, how they’ll be carried out, and sets a framework for how that is all governed and managed. I give the House a couple of examples. In Hawke’s Bay, we tried to set up what we called an Intersector Leadership Group, to deal with issues in the community that intersected between local and central government. One of my major frustrations in the role I previously had before coming to this House was that you always heard from the Government departments how difficult it would be to get budget, reallocate resources, or make a change to policy without head office. So they’d invariably run off to head office, we’d have a meeting, head office didn’t really understand it, and it was almost impossible to get many of those things over the line.
So in an inability to work together, we pursued with that regime. It was led by a couple of pretty talented chief executives. I’m pleased to say that there are now some changes being made, and some of the central government agencies are now way more responsive. But if we are to sort out issues, particularly in the regions away from Wellington, then we need to have structures that allow collaboration, a certain amount of autonomy, and some overall direction and guidance. For that reason, I have great pleasure in supporting this bill.
GINNY ANDERSEN (Labour): Mr Speaker, I thank you very much for having the opportunity to speak on this bill. It’s great, too, as a former public servant, to be able to see great improvement in an area where there’s always room for more improvement. It’s good to see here a bill that really enables the Public Service to have far more flexibility. Before I move on, I’d just like to note that the Te Kao dairy does the biggest ice creams in New Zealand, and big shout-out to upstairs. Thank you very much for coming today.
In terms of funding, it’s really good to see an alignment between what the Minister of Finance and what the Minister of State Services are talking about, because we start to see how this Government is building a picture of where those pieces join together, to make not just the Public Service able to operate more fluidly but to enable the way that they are delivered funding and the way that funding reaches New Zealand to be more closely aligned. That has been a fundamental blockage in the system in the past.
It was only this morning that we heard in the Justice Committee, in terms of the reviews there, how there’s been some really significant improvements in terms of family violence, with all of those agencies that had been funded under the same budget that were able to work together with shared goals and shared outcomes, and to be able to deliver this in a way where they are all able to take recognition and be held accountable through that process. So that’s a new process as a result of the most recent Budgets and it’s enabling better services to be delivered to New Zealanders.
I’d like to use an example, and this is no criticism of anyone in particular, but it is to show how what we saw this morning in the Justice Committee has changed from previous practices. In terms of the establishment of something like the Gang Intelligence Centre, where we had eight different agencies, all with their different hats on, all with their different funding, all with their different priorities, who were trying to deliver outcomes, it was incredibly frustrating because from the ideas that were happening in Wellington to the practicalities that were delivered to New Zealanders, there was a huge gap. There was a problem, and so much of public servants’ time and consultants’ time can be wasted in terms of trying to argue where that alignment sits.
So being able to have one common goal in how that funding is lined up really stops those examples that we have seen time and time again in the New Zealand Public Service of not being clearly aligned in terms of what the outcomes are. Each of those different entities had their own accountabilities in the past. They had their own requirements and their own different ways of thinking, to be frank. So by aligning those from the outset provides not just better quality policy advice but also better deliverables when you translate from policy, from the idea into implementation and practice. And I think that saves money all round as well for New Zealanders. A good idea doesn’t always perfectly translate into a good practice, and the value of increasing the emphasis on collaboration, which is what this bill does exactly—what that does is it enables those parts of Government that do the policy development and those parts of Government that do the implementation to talk up front.
As a former employee of two public services, both the Office of Treaty Settlements and New Zealand Police, to see the benefits upfront of policy and operations being side by side and discussing how an idea will hit the road, how that idea will practically be implemented, can save the taxpayer so much money and can save New Zealanders wasted time in having to fill out forms or do things unnecessarily. There are huge benefits that lie in what this bill sets out, to enable delivery to people and a better use of Government funds to be set from the outright, and I’m personally really excited to see where that can take us.
While it’s great to see agreement from both sides of the House—and I’m pleased to always see that particularly in an area that I am passionate about, in an area that holds so much benefit for how we’ll be operating in the future—it’s been interesting to note the little points of difference we’ve heard today in this debate so far. One was, first of all, the Hon Dr Nick Smith, who spoke about the most important thing of the Public Service being “that I’m getting value for money; making sure that they’re not getting too much pay if they’re going from one agency to the other; or making sure we’re getting everybody working as hard as they possibly can, and not having a Gliding On situation.”, whereas I beg to differ.
I would see the best value in our Public Service being really good quality advice, and its people who have the confidence and the ability to work in an apolitical way, in a way that gives them the time and the research, the knowledge—all of those things that, put together, make a really good piece of advice that can inform ministerial decisions in the best way possible. By enabling that collaboration, that contest of ideas, by enabling that process to happen in the best possible way, that puts us ahead of the world in terms of the quality of our Public Service. And that’s something that I’m incredibly proud of having here in New Zealand. So I would say that the real value of our Public Service is the top-quality advice that we get, and it’s important to continue to improve how we do that.
I’d just like to note, too, that it’s really encouraging, on that note, to see some of those really fundamental values that the Public Service has always known now being sort of written in. So those areas of political neutrality, free and frank advice, and merit-based appointments are to be embedded into the new Act. I am really encouraged by seeing how well that goes.
In terms of, also, getting back to that robustness of advice, the best possible way is to enable officials, no matter where they’re from, to be able to do that. We have had many examples—and I’ll say, yes, they’re from both sides of the House—where what we’ve seen is an outcome delivered already to officials. I can remember one in particular around crushing cars where we were told straightaway to go away and do that, and you worked backwards. So I have to say, developing a regulatory impact statement that references German reality TV isn’t a good practice. It’s better-off to have some really good research to determine what a problem is, what other agencies are doing already, how the problem is working, and what the best course forward is.
So it’s having a far more transparent Public Service; having one that’s more able to be apolitical, to do the work, to have that area, that produces better quality policies, produces better quality laws, and produces better quality outcomes for New Zealand. It makes us proud to be a Government, to be an institution in New Zealand that can hold its head up and say, “We did a good job here. We understood this problem. We analysed this problem. We identified the risks. We identified the opportunities. And we made these decisions based upon good quality advice.” That is the real strength that the Public Service delivers, and this piece of legislation enables those strengths to go forward even more.
The last point I’d like to make is the fantastic piece in this bill that particularly acknowledges the role of Māori and our obligations under the Treaty of Waitangi. This has been previously silent in Acts, and it’s really interesting when you get your statements of intent from all your departments, you’ll see right up front that “We operate under the principles of the Treaty of Waitangi”. I’m always interested to ask, “How do you do that? How do you do that on a daily basis? How does that look in your staffroom or in your practices or in your policy work?” And you always get in Cabinet papers a statement that you’ve complied with the Treaty of Waitangi. But I’m always a little bit unsure of how that practically happens.
So by having a State Services Act, having a piece of equipment like this in legislation to put it really clearly that there is an obligation in the Crown-Māori relationship—and it makes chief executives operate as a good employer in policy, recognising the aims and the aspirations of Māori, the employment requirements of Māori, and the need for greater involvement of Māori in the Public Service, in their decision-making process—that it’s inclusive and you haven’t got people making decisions for other groups. This bill puts it right by explicitly recognising the role of the Public Service in supporting the Crown and its relationship with Māori under the Treaty of Waitangi. And in order to do this, Public Service leaders will be held responsible for developing and maintaining the capability of the Public Service to engage with Māori and to understand Māori perspectives.
The commissioner, in development with the implementation of leadership strategy for the Public Service, must also recognise the good employment requirements relating to Māori. So under the current Act, each department has previously had a narrow focus on its own identity, a narrow focus on its own goals. And what this enables is a greater platform for working together, for better outcomes for New Zealand, for better outcomes for our public servants to be able to use—
SPEAKER: Order! The member’s time has expired.
Bill read a first time.
Bill referred to the Governance and Administration Committee.
Hon CHRIS HIPKINS (Minister of State Services): I move, That the Public Service Legislation Bill be reported to the House by 28 April 2020.
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 of Aotearoa New Zealand 8.
Noes 56
New Zealand National 55; Ross.
Motion agreed to.
Bills
Credit Contracts Legislation Amendment Bill
Second Reading
Debate resumed from 19 November.
SPEAKER: When we were last discussing this bill, Deborah Russell had the call, and if she really wants it she has seven minutes and 30 seconds remaining.
Dr DEBORAH RUSSELL (Labour—New Lynn): Thank you, Mr Speaker. I do very much want those seven minutes and 39 seconds, because there are voices that have not yet been heard in this debate and I want to report them. In my earlier part of this speech, I talked about the collaborative work we had done in the Finance and Expenditure Committee and some of the authors of this bill, Mr Andrew Shann, a lawyer who worked on earlier versions of this legislation; of course the Minister, Kris Faafoi; and the very cooperative work done by Mr Brett Hudson, Mr Andrew Bayly, Mr Greg O’Connor, Dr Duncan Webb, and others in the select committee.
But from here, I want to turn to the voices of the submissions as to why this legislation is necessary. Minister Faafoi and Mr Brett Hudson have taken the House through some of the technicalities of the bill. Here are the voices of the people who we are legislating for.
When I last spoke, I referred to Mr David Seymour—unusually, taking one for the team and contacting a pay-day lender, one of these lenders that we are trying to regulate a little better. Just one contact, but from there he was badgered with texts and with messages urging him to take out one of these high-cost loans. I don’t believe he did. Nevertheless, that process of being badgered is something that all people who take out high-cost loans are subjected to.
We had many organisations speak to us, but just one person who had taken out a high-cost loan. Sarah Newham very bravely came and spoke to us about her own experience of what it had been like. She took out a pay-day loan in 2018. She’s a sole mum and she had kids’ birthdays coming up and she needed some cash and she thought she could manage. So she took out a high-cost loan, borrowed just $400. She said it was really easy. She went online, answered a few questions, and the money appeared in her bank account just like that—too easy.
She’d budgeted terribly carefully to make sure that she could manage the repayments, and she did really well for the first few weeks. She made the first couple of payments—nearly a quarter of her income—but then she missed the next one. She contacted the lender. She tried to arrange matters but she ended up getting penalties and getting higher interest. She got slammed with extra costs for this loan because she was late with one payment and things got worse and worse. She said there were weeks when she had to choose between paying electricity and paying for food. And it got to the point where she was begging them to send the debt to a debt collector because then at least it would be finalised, at least there would be no penalties. But they wouldn’t.
Eventually, she got the local budgeting service involved and they got the lender to send it to a debt collector, and from there, she was able to manage the debt. So she said it was terrible, and it was really hard to make the repayments. This was a woman who was trying to do the right thing. Eventually, she got it sorted. But here’s the kicker: on her birthday, she got an email from that high-cost lender who said, “Happy Birthday, Sarah. How about you treat yourself with a loan?” That’s appalling. That is appalling. A loan is not a treat. So that is a story from someone who actually experienced what it was like to be subject to the whims of a high-cost lender.
We heard a wonderful submission from Komiti Pasefika of the New Zealand Council of Trade Unions, a group of wonderful Pasefika men and women who came in to talk to us about what it was like in the Pacific community. There are some real cultural obligations in the Pacific communities: funerals, weddings, being a chief. People in that community can often be subject to the pressures of needing to get cash and get it fast, and then they end up subject to high-cost loans. What they begged us to do was to make sure that loan sharks were properly regulated—that if people did take out loans, it was done in a responsible fashion and their capacity to repay was properly assessed. So they asked us for regulation of high-cost lenders, similar regulation of retail truck shops, much more effective enforcement, and much stronger regulation of debt collection. Why? To protect members of that community.
We heard—and this is, I think, one of the most enjoyable submissions in a way—from the Josephite Justice Network, the Sisters of St Joseph of the Sacred Heart. I was a convent schoolgirl and I remember the nuns. I tell you, these nuns were the most radical ladies I’ve ever met. They were just wonderful. And so to Sisters Carmel, Adrienne, and Marie, thank you for coming in and speaking to us. They came from Gisborne and they talked of the difficulties that people were faced with in their communities when they had to manage these short-term, high-cost loans. Again, they talked to the people they worked with on a day-by-day basis in budgeting services, when people turned up just asking for assistance just to manage what to many of us is only a small amount of money. But if you are impoverished and caught with a high-cost loan, it becomes the end of the world, really. So they wanted a ban on retail truck shops. They wanted more effective enforcement. They wanted stronger regulation of debt collection. This legislation does keep faith with those radical ladies who came in to talk to us.
Finally, I wish to speak of FinCap and, in particular, of Tim Barnett, who is actually a former member of this House, who’s the chief executive of FinCap, and one of the people who works with him, Soraiya Daud. They came in and made a whole series of technical arguments, but the argument they made most strongly was that there should be a cap on the interest rates that can be charged by high-cost lenders. Now, that was not in the original legislation. Originally, we had a cap which was a cap of the total amount of interest that could be charged, but not a cap on the actual rate. But FinCap, which represents all sorts of budget services, argued strongly for this cap.
Mr Brett Hudson mentioned that it was not included in the original legislation, but as a select committee, we listened to what people in the sector actually wanted, what they felt was needed to ensure that some of our poorest and most vulnerable are protected, and that is why in the final version of this legislation that has come back to the House from the Finance and Expenditure Committee we do have a cap on interest rates. So now, if you have a high-cost loan, if a lender issues high-cost loans, the maximum interest rate that can be charged is 0.8 percent a day. Now, that’s still 230-something-or-other percent interest per year. I’d have to do the maths again. It’s still a very high interest rate, but nevertheless it limits it. It sets a cap on it. We are doing that because of the work of FinCap, and so they too are some of the authors of this bill.
NICOLA WILLIS (National): National supports this bill because we want to see more informed borrowers, we want to see more responsible lenders, and we believe that changes are going to be helpful to further both of those goals.
I want to talk, first, about the concept of more informed borrowers, because the lending of finance in the economy works within a market. But a market can only work effectively in this case if the borrowers are informed effectively, because if they are not informed, then the potential for unscrupulous practice is too great and the risk to individual consumers is there. So when we talk about more informed borrowers, we’ve had the previous speaker talk about the example of people who take loans, not knowing necessarily the way in which they will accumulate interest and that they will grow over time. I want to acknowledge here that while this bill does some useful things to help inform borrowers better, the other aspect of this that I think the bill really does rely on is increasing efforts to increase the financial literacy of New Zealanders, and I want to acknowledge the role the private sector, our banks, and financial institutions are actually playing in furthering financial literacy within our communities.
But the second thing, of course, that’s vital is that even if we have informed borrowers, we still need to guard against the possibility of irresponsible lenders, and the bill takes a number of measures in that regard—for example, around being far more prescriptive about what a lender must do when they’re assessing the affordability and suitability of a loan. I want to again take a particular example here, which is that of the mobile traders, which have been spoken about in this debate, and this is this practice that’s emerged of people taking trading entities around communities where there is deprivation or there is vulnerability and providing them access to household goods when they know that they’ve run out of cash at the end of the week, but doing so in very high interest arrangements that further get families into debt and can become a terrible burden for them.
While this bill will do some important things to reduce the possibility of that by increasing the requirement on lenders to assess whether or not people can take on that loan, I also want to acknowledge the role of other entities here—for example, the Salvation Army, who have said, “Well, obviously, there is a need here in the community for the availability of mobile goods. People are prepared to take out these excessive loans in order to access household goods at certain times in their pay cycle. How can we step into this breach? How can we step into this space to make sure that if lending dries up in this area, there is an alternative for these families?” I do want to take this opportunity to commend the Salvation Army on that action.
But the third thing, that I know the Finance and Expenditure Committee considered carefully in examining this bill, was the balance between regulating appropriately but then the possibility that over-regulation actually creates a black market that is completely unregulated. It’s for that reason that previous speakers have noted concerns about the introduction of the interest rate cap, which officials had advised against. The questions, I understand, that were asked at the select committee were simply: would that push some forms of lending underground? I think it’s important that the House notes the need to watch that carefully, because the potential there, of course, is that there are a group of consumers, a group of borrowers, who end up in worse situations, more pernicious situations, because the availability of credit on the regulated market is so constricted.
So, as I said at the outset, National wants to have more informed borrowers. We want more responsible lenders. This bill furthers a number of small steps forward that further those goals, and, for that reason, we support it.
FLETCHER TABUTEAU (Deputy Leader—NZ First): Thank you, sir. It’s a pleasure to rise on behalf of New Zealand First to speak to the Credit Contracts Legislation Amendment Bill. I just want to acknowledge, firstly, the constructive approach from the Opposition in select committee. I think it has been mentioned by previous speakers, but it’s worth noting again because in the Finance and Expenditure Committee, there is often heated debate, but, actually, that heated debate is, in my opinion and observation thus far, always constructive and seeks to come to an agreed outcome where all of those members on that committee see the best interest of New Zealanders at the forefront of the efforts of their endeavours in that committee.
When I say that, this legislation has been about a Government, but I say a Parliament. Efforts were made previously, actually, by the previous Government—I think in 2015, if memory serves—to take legislation down this track. I think those on the other side have acknowledged that there was a genuine attempt made but the effort didn’t go far enough, and so here we are. That’s not to disparage those on the other side of the House. Here we are, though, together, looking at how we can do this better in a way that is beneficial to New Zealand consumers who have need of these short-term loans and credit. But how is it that we look after their best interests and have consumers’ interests at heart?
The context in which we come to the House is that, as others have said, we have unfortunately experienced—I think all of us—firsthand, in the respective electorates, those people who have suffered at the hands of loan sharks or short-term debt collectors, short-term loan providers, and have come into our offices and told—you don’t want to say stories, because that implies that it’s fiction. This is not fiction. This is real people suffering through incredible hardship because they have been restricted in their access to money.
I suppose there’s one way to put that in context: 40 percent of New Zealanders do not have access to credit cards. What that illustrates to those in the House and those listening is they’d likely not have access to short-term loans from the banks either. So where do they go? There has been and is a service provided to New Zealanders that meets a need.
But what I want to say—and perhaps it’s time to get into the specifics of some of those conversations that we had in the committee—is that we have said, yes, there is an opportunity and there is, unfortunately, a need for access to credit, but what does that look like? One of the things that we spoke about in the first reading—not because of submissions but from conversations that we’d had around the country; all of us have had them—was this conversation about the fact that the bill didn’t come to the House with the interest rate cap. That immediately generated lots of public discussion, and I myself pondered on that in the first reading, and I know others did too. So, subsequently, you can picture the contributions in select committee. They were robust, and they were fulsome, and, actually, what they were able to do is provide examples from around the world of interest rate caps being applied.
The select committee and all members asked the question, “Well, what is that going to do to people who need these short-term loans? If you put on an interest rate cap, doesn’t that make it prohibitive for providers to lend out money?” Actually, what we learnt from the cases provided to us from Britain was that, post analysis of the implementation of an equivalent cap in Britain, the conversations with those people who used to use those short-term loans, unfortunately, on a frequent basis—post analysis, they themselves realised that they were actually a lot better off for not having access to those loans.
I put that in context. This debate needs to focus on the wording around debt spiral. A debt spiral is all about people having access to money and then needing more money to pay for that previous access to money, and maybe even needing more money again to pay for the access to that previous money. Actually, what the select committee did, by way of example, was have a conversation around that debt spiral and access to money, and what the committee recommended to the Minister and to the House and what we see here in this legislation is that, actually, one of the triggers, or one of the issues that needs to be part of this legislation—and, as I said, it is—is that we must make sure that those people who have used short-term loans cannot access more and compound the problem and, variably, drive themselves into that debt spiral.
That has been just one of the many constructive contributions from the select committee in terms of—I’m going to say—improving the legislation. I think all of those in the House would agree that it has come out of select committee. We have listened to the hundreds of submitters who made the effort and took the time to put themselves in front of the select committee to have their say and to talk in great detail about the fine differentiations between what is an effective interest rate cap and what is not and what is the definition of a short-term loan and what is a long one.
I think it’s appropriate to end my contribution on that note. Not only do I commend those who took the time out on submission to the select committee, but again, as I started, I commend the select committee as a whole—not only the Opposition, of course, but the work of the Government members. It was an example of collaborative and positive constructive work. On that note, I commend this bill to the House. Thank you very much.
IAN McKELVIE (National—Rangitīkei): Thank you, Mr Speaker. I’ll take a brief call on the Credit Contracts Legislation Amendment Bill. It’s a very interesting piece of legislation, this, because, on the face of it, it looks like it’s dealing with some terrible problem we’ve got—and, to some extent, it is—but, also, what really interests me about the submission process was it’s not necessarily all bad. Some of the short-term loans that this deals with are actually very necessary for families to deal with issues that, in fact, are very short term—nonetheless, quite expensive.
I also had this view of, I suppose, what we’d call the trucks that go around New Zealand, or vans that go around New Zealand, hawking stuff off. When I was a young fella living down a no-exit metal road, we used to have the same thing, but it was the butcher bringing a bit of bacon down the road and the milkman bringing the bread and the milk and the whatever down the road, and they sent a bill at the end of the month generally, and they got paid.
It’s a very different environment we live in today, and that’s an issue that this bill sought to deal with. Frankly, I think there certainly are some interesting practices with respect to the way that these loans are put out there, and this bill, I think, has managed that through a cap that we don’t necessarily support, although I think there’s some merit in it, and also through regulating and managing the fees that are able to be charged on these loans. So that’s pretty good.
Just getting back to the direct sales people, you don’t see them going down the no-exit metal roads any more; you see them going down the streets in town where people can ill afford to use the services they provide at extortionate rates. This bill has moved to get some influence in that area and to put some controls on it, and I think it’s a very worthwhile piece of legislation from that perspective.
The select committee process was quite interesting because, as our chair mentioned, David Seymour decided to get a loan halfway through the select committee process, and by the end of the first select committee meeting I think he had about 300 or 400 offers. So it’s pretty easy to get a loan out there, and that was the point that was made. And it’s also pretty easy to get a loan without any proof of the fact that you can repay it, and I think that one of the challenges we face in New Zealand, one of the challenges we face in the world, is that not everyone is born or has the ability to attain equal financial literacy. So some of these things become very challenging, and that’s what causes Governments to need to legislate and regulate in those fields.
So I’m not going to say much more about this bill. I think it is a good piece of legislation. As I said, we were challenged to some extent by the cap, not so much because we don’t like the idea of a cap but because one or two of the submitters pointed out that the cap can then have an impact on the ability of people who desperately need some short-term money. It might only be for a month to get that money and move on. I don’t necessarily agree with that, because I do think that there’s the ability for them to do that under this bill’s current situation. So I commend it to the House. I think it’s a very good piece of legislation.
GARETH HUGHES (Green): Kia ora, Mr Speaker. Ngā mihi nui ki a koutou. Kia ora. I rise on behalf of the Green Party to support this legislation, this very good legislation which is going to make a real difference to people’s lives. Now, I hear the comments of the previous speaker, Ian McKelvie, and I think it’s important to acknowledge this is a relatively modern phenomenon, these third-tier market lenders, pay-day lenders. New Zealand’s first one only emerged in the year 2000. This is something new and is having a huge impact on New Zealand.
I acknowledge there’s a small market for short-term, high-interest loans—maybe, you know, a business example—but the vast bulk of people receiving these pay-day loans, or these short-term, high-interest loans, aren’t business people. They’re not trying to carry over. It’s disadvantaged families, in many cases being taken advantage of by predatory lenders. We just have to say that, because that’s the actual truth, and what we know is the latest figures show there’s $120 million being taken out of some of our poorest and most disadvantaged families—many of these families with children—as a result of these high-cost, predatory loans. We’ve seen annualised interest rates of 600 percent, 1,000 percent, 2,000 percent. We saw evidence in the Finance and Expenditure Committee of interest rates at an annualised basis of 2,600 percent. That is simply outrageous, simply unacceptable, and I’m glad this legislation is doing something about it.
I’d like to acknowledge the committee because they have improved the legislation. Often, committees can improve legislation with technical fixes, transitional provisions. This has been fundamentally transformed by including an interest rate cap. Now, the original legislation was around capping the total cost of borrowing. That was worthy. That was a very positive step forward. But there was a chorus of experts and those who work at the coalface of the high-cost lending sector that it wasn’t going to be enough, that you would actually still see low-income families paying way too much, being taken advantage of, if the total cost of borrowing wasn’t also supported with the other wall, the other protection, which was an interest rate cap. So I’d like to acknowledge the committee. They’ve fundamentally improved it.
I’d like to acknowledge those people who have played a role advocating for this for an awful long time. I’m thinking of Andrew Shann, who I’ve met with, who’s previously drafted legislation to this effect, I understand with Carol Beaumont, a former member who’s no longer here, who was at the forefront of this campaign. But most of all I would like to acknowledge FinCap and the Salvation Army, who tenaciously and very assertively campaigned for an interest rate cap. I’d like to acknowledge their campaign. They presented evidence such as this that pointed out how many other countries had the protections of an interest rate cap: Australia, the United Kingdom, United States, Canada—in fact, they referenced 76 other countries that had interest rate caps.
This wasn’t something new, something novel where we were going out on a limb into an experimental environment. This was something which is the norm overseas, and I’m glad that New Zealand is taking a step towards joining the rest of the modern world that has said there are social ills and huge economic problems when you refuse to cap interest rates. So I’d like to acknowledge FinCap and the Salvation Army. Of course, they did a huge amount of work, including working with Business and Economic Research Ltd (BERL) and contracting BERL to publish the substantive report, which made the economic case for what a huge impact high-cost, high-interest loans was having on New Zealand.
Now, this issue was something the Green Party has been raising consistently; it’s something we’d previously voted for when it was before the House in previous Parliaments. It’s something we lobbied the Minister on. It’s something we used our ability to speak in the media to advocate for. While I wasn’t privileged to sit on the select committee, I was still reading the submissions, meeting with the submitters, working out how we could support the Government to do the right thing, and I’m so glad that the Government parties, including the National Party, are supporting it today.
Now, I think 0.8 percent is still too high. On an annualised basis, that’s still quite a large figure. I guess, because this is a new regime, there is the ability to review it in the future, which I think is great. I wouldn’t be surprised, in fact, if we find 0.8 is too high, but this is a great first step. I really want to acknowledge the Minister, Kris Faafoi, who’s been wonderful to engage with, who’s been constructive, who’s listened to the evidence and acted. This is something that I drafted a Supplementary Order Paper on, and I’m glad that there is no need for that any more because the select committee has improved this legislation by including it.
So while I’d like to thank everyone who’s been involved, I just want to reiterate that this is a concrete example of how this House today is helping people who are facing these horror stories, which the committee heard, where kids are going without presents at Christmas, where people are having their weekly pay cheques mostly eaten up by these high-cost loans, where capping the total cost of borrowing would simply see these predatory lenders increase the number of loans. It would rapidly increase the size of the initial loan to get around this. So this prediction is making a real difference.
Now, when FinCap talked to me, they talked about the 70,000 people that they work with every year and the $700 million in debt that hangs like a millstone around those New Zealanders’ shoulders. This is a great, positive, concrete step to make a real difference. This Government often talks about wellbeing, and I think here is a concrete, tangible example of how the wellbeing of everyday New Zealanders who work hard—I note the previous comment around financial literacy, and I acknowledge there is more we could be doing to encourage financial literacy in New Zealand, but make no mistake: these people are using very sophisticated marketing techniques. They are making the most of psychological research on how to encourage their business, and they’re in the business of trying to get as much money out of some of the poorest New Zealanders as they possibly can. They’ve been stunningly successful, but that has gone on for too long, and this Government is acting.
I believe the Government in the future can actually do more, because while I thought the risks of a black-market, third-tier lending scenario arising were overblown, and we haven’t seen that occur overseas, we still know that there are people out there trying to take advantage of some of our most vulnerable New Zealanders. Perhaps there’s a role, I think, for the Government to in future consider how they can support responsible lending and access to capital tools for those families who need it. So thank you once again to all the members on the committee. This is a very proud day for our Parliament. Kia ora koutou.
LAWRENCE YULE (National—Tukituki): Much of this legislation is way overdue, and I’m very happy to support it. I want to reflect on comments from previous speakers and members of the Finance and Expenditure Committee, and Fletcher Tabuteau, I think, summed it up pretty well for me. There has been a lot of conversations in the committee. There has been a couple of chairs while I have served on it, and I want to acknowledge Deborah Russell for her work, because I think we all acknowledge across the Parliament and across the select committee that there has been a problem and it needs to be sorted.
Now, while this particular side of the House may have some issues with an interest rate cap, I think that is sort of, in many ways, around the edges. What I found and what we found, and even before I came into this place, is there is a lot of what I call predatory lending going on, and all it is doing is further causing people misery and harm. And in certain parts of my electorate, those trucks are simply a curse.
So we have looked at options to try and really protect the more vulnerable people in our society. I think it’s a great day when this legislation can get to this point. I think the select committee has done a great job. I have talked to a number of budget advisers in my own electorate who have shared with me, even now, how people are trying to find ways around what’s being proposed. I think most of those loopholes have been sorted. When I went to a place in Gisborne recently and I talked to some employers, they said that as soon as they have a job, even if they haven’t started work, the loan is made available. They go and buy a TV. They go and buy a whole lot of other things without any money actually physically going into their account, but, based on pre-emption of pay-day lending, they are lent a whole lot of money.
So I think this bill seeks a really good balance, and personally I’m very supportive. I’m pleased that our party is supporting it, because it will make a difference to a number of people who, quite frankly, are being ripped off. There are some people that need help from time to time—short-term help—but for many cases, that turns into long-term misery. A role of this Parliament and the legislature is to find a solution for that. For that reason, I’m very happy to support this bill.
KIRITAPU ALLAN (Labour): Can I just say it’s a real delight to be able to follow on from the member Lawrence Yule on the opposite side. He articulately, I think, stated what many of us felt who sit on the select committee and heard the submissions from those many advocates who work in budget advisory services, right through to those, as my colleague Dr Deborah Russell mentioned earlier before, who had been people that were subject to the predatory loans and found themselves in quite a rough time. I think we all collectively shared—around the Finance and Expenditure Committee over the several months that we did consider this bill. I think there were some really clear lines that you could see: that there are specific people within our communities that are vulnerable, and that our job as legislators is to find that balance that the member Lawrence Yule just spoke to prior, and exercise our collective will. So it’s quite nice when you get to get up at the end of the week and agree with all of your colleagues across both sides of the aisle when we’re acting to protect some of those most vulnerable people within our communities.
From my own perspective, and coming from the East Coast, we had a number of really persuasive submitters from Gisborne—in particular, the fierce women, and they are mostly women, from the budget advisory service who not just in the select committee process, but they did participate in that, but on several occasions called me into their office to lament or really share their frustrations and concerns, as have been shared in this House this afternoon, about just how hard some of these pay-day lenders pursue vulnerable clients. They then took the time to walk me through what they did as advisers working alongside those families that were stuck in those cycles of debt. These are people from a whole range of walks of lives. I’m talking about the advisers who volunteer at the budget advisory service—but just the real pain that they shared on behalf of just family after family after family. So I really want to take my time this afternoon to acknowledge those volunteers up and down the country who work alongside some of our community members that really are having a rough time, and, yeah, they give so much.
So too we heard earlier about some of the sisters, the nuns, from Gisborne that came down to share their experiences. Gosh, they were quite radical. I didn’t grow up with nuns as a big part of my life—my experience was through that movie Sister Act, so I knew that they’re a little bit radical, but geez, they were. But they really sort of set us on the map, and made us really think about families in all sorts of walks of life. It’s not just those that are continuously at the lower end of the socio-economic rungs. For example, in our communities at the moment, we’ve got a lot of agricultural families that are in immense financial strife. On the wrong day, at the wrong time, with a little bit of persuasion—an act of persuasion by some of these predatory loan companies—they were being pursued. So they spoke on behalf of those families as well, as did the rural women’s association.
I think too though, for me, as we were engaging in this process and trying to strike the right balance, I want to acknowledge the Hon Kris Faafoi. We worked really closely with him and his whole team of advisers around the interest rate cap. So I can only commend Tim Barnett, the former member of this House, his team, Soraiya Daud, and their whole crew that they brought together and the campaign that they ran to, I guess, really walk us through how we could implement an interest rate cap that struck that balance that still enabled financiers to be able to provide short-term loans as appropriate, but to be able to limit those interest rates to a state that was manageable. So I commend him. But as we were considering this legislation, another change that was made through the committee process was bringing mobile traders into the Act and made them be—anyway, I want to acknowledge Carol Beaumont, because she came to mind. I commend this bill to the House.
SIMEON BROWN (National—Pakuranga): Thank you, Mr Speaker, for an opportunity to speak at the second reading of the Credit Contracts Legislation Amendment Bill, which the National Party does support. This is a piece of legislation which I wholeheartedly support, with a couple of reservations. But it is important because this is the type of predatory loan shark behaviour that we see in our communities, where people target those who are living in poverty, those who are struggling to get by. Targeting them to charge high interest rates to make them dependent is something which I find personally incredibly abhorrent. I’m pleased that Parliament is taking further action against that type of behaviour.
I do want to acknowledge the legislation passed by the last National Government, which did make significant reforms in this area and made huge improvements. This piece of legislation will continue in that spirit, and will continue to protect consumers, and provide more support to ensure they understand the consequences of the lending that they are undertaking and to ensure that the people who are lending to them actually meet proper tests, such as the fit and proper person test, which will now also be required to be met by mobile traders. But this piece of legislation also does include a cap on interest rates, and that is something which I personally don’t support. I do think that they will, as some submitters said, become a target instead of being something which we can regulate through other mechanisms. An interest rate cap will become something which becomes the default rate. At 100 percent interest—essentially, that’s what it ends up being—that is a significant rate which will, for some people, mean they end up in a worse situation, potentially paying a higher interest rate or having to take out longer-term credit because shorter-term credit becomes less available.
The decisions we make and the intent that we have always has unintended consequences. I think that, unfortunately, one of the things we will see happen when this bill is passed into law is we will see unintended consequences, and this is an issue which this legislation will not mean goes away and I’m sure future parliaments will have to grapple with again to ensure that we do protect our most vulnerable, whilst at the same time ensuring that there is finance available to those who do need it. National does continue to support this legislation through the House.
GINNY ANDERSEN (Labour): Thank you very much, Madam Speaker, for the opportunity to speak on this important piece of legislation, the Credit Contracts Legislation Amendment Bill. The main aim of this bill is to stop private sector practices which cause or deepen hardship which already exists. It’s one of those things that, to be frank, really sticks in my craw: taking advantage of people who need some extra help and support—profiting off someone in a position where they need some assistance. There have been many examples through the select committee process where there are practices that are technically legal in New Zealand law that, quite frankly, prey on those who can’t fight back, and that really gets to me.
I’m encouraged to see that these protections complement longer-term work to really try and lift children out of poverty and increase people’s financial capability to be able to look after themselves and look after their families, and not leave people stuck in a cycle that, quite frankly, not only leaves people hungry but leaves people in situations where their mental health suffers because, every day, people don’t know how they’re going to be feeding their families. They get themselves deeper into debt, and then people prey on that vulnerability, and I do not like that.
So, in particular, I’m really happy to see that mobile traders will be brought within the scope of the Credit Contracts and Consumer Finance Act. I know those red trucks when they’re around and I know you can pay $30 for a pack of Weet-Bix and that’s just wrong—that’s just wrong. Not only do you pay $30 for your pack of Weet-Bix but you’re paying interest on that $30. So while it’s great that we have private companies like progressives, who send out trucks in some parts of New Zealand to be selling groceries at a shelf rate alongside to try and compete on these predatory practices—I commend companies for doing that—we need to do more than just rely on the private sector to fill that space.
So it was good to see at the Finance and Expenditure Committee that there was widespread support from submitters for tighter regulation of these mobile traders. They’re quite clearly creating harm in our communities and they put people in situations where they, quite simply, can’t repay debts. That contributes to New Zealand children going to school without lunches or not attending school because they don’t have a lunch or haven’t had breakfast, and that’s the kind of cycles that we want to move away from as a Government.
Debt is a major concern for New Zealanders, and we know that. We know a lot of households in New Zealand spend more money than they earn in a regular cycle, and we need to be working effectively to make sure that there are checks and balances on those short-term loans to make sure people know what they’re signing up to, people know what they are committing to, and people know what those repayments are. That’s just fair.
Some people might want a short, quick loan for certain reasons before pay day, and that’s fine—everyone has the freedom to do that. But, as part of that freedom, people need to be clearly understanding what they’re having to repay in the future and how that impacts, and it also helps families to plan for the future. When you know what the next instalment’s going to be and when you know what the penalties are, that’s a strong way of making sure that families are able to budget in a way that gives people the confidence and the reassurance that they can get back on their feet if they’re going through a tight patch.
I think it’s also important to note that there were submissions around car loans as well, because, for me, I’ve seen situations in my own area—in Hutt South—where I’ve had families who have purchased a vehicle unaware of the details of that contract, and the repayments on some of those financing areas have been, quite frankly, unfair. So it’s good to also see some improvements in that area.
I think it’s important to note that there is a debt spiral there and that having a bill that takes clear actions to try and prevent that debt spiral from kicking in is really stopping situations where we’ve seen 803 percent per annum interest rates, where people are charged fees that range between $5 and $5,000 for no apparent reason, and also, really, the failures by loan sharks to disclose what is in all the parts of that contract that someone is signing up to. So by having clear areas where we know that this package will deliver and by having these changes, it will reduce the problem, I believe. It will reduce debt and the harm it does for people.
In order for these reforms to be effective, we’ve also strengthened the penalties where the law is breached, and I think that’s incredibly important. It’s all very well having the law there, but I think those who were benefiting in this area under the previous law also need to be held accountable for when, going forward, they haven’t complied with the new legislation. Stakeholders throughout the consultation commented on both the stronger enforcement and penalties that were needed in the lending industry for serious breaches of the law. It’s great to see that the select committee have listened to that feedback by including new and tougher financial penalties and statutory damages and by improving banning orders for breaches of the law.
So I’m encouraged to see that this is an area that where New Zealanders have been preyed upon, it’s great to see a select committee that has really listened to people and made improvements to the law, and it’s an area we can continue to work on to make sure that people who earn money and who want to live a good life in New Zealand get the opportunity of getting back on their feet and that debt is not used as an opportunity for those who wish to profit from it. I commend this bill to the House.
HARETE HIPANGO (National—Whanganui): Thank you. I take the last call for the National Party this afternoon, and although I didn’t sit on the Finance and Expenditure Committee, I did substitute in in a period of time to listen to submissions coming from community groups such as the Citizens Advice Bureau and another local group, the Wellington Community Justice Project. It took me back to the days when I practised in the criminal jurisdiction with a number of my clients, particularly in the role of duty solicitor applying for legal aid. The majority of my clients, when it came to declaring what their debt situation was, would often record some of the debts with these loan shark organisations—particularly, the red trucks that would drive around in a predatory way and park themselves up in our lower socio-economic communities.
So this bill, the Credit Contracts Legislation Amendment Bill, is about addressing those usurious lending practices. Now, I had to look up what that word meant. Here I am, as a lawyer of some years of practice, but my role wasn’t in the commercial sector; it was about helping our vulnerable people. “Usury”—the definition of that, for those who may be watching this debate and for the benefit of my colleagues in the House, is an unusually high interest rate or the lending of money at an unusually high interest rate.
An example: usury is an interest rate of 30 percent when normal rates are at 15 percent. So at the end of this debate, people who have been listening would have picked up that this was about the inflating and the inflammatory practices that go with these loan sharks and their predatory practices, prowling on the poor—how’s that for alliteration at the end of the week?
This bill, as is known, amends the Credit Contracts and Consumer Finance Act. It’s strengthening the requirements to lend responsibly, especially in relation to how affordability and suitability tests should be conducted. So as my colleague Simeon Brown alluded to, the National-led Government, back in 2014, passed the Credit Contracts and Financial Services Law Reform Bill. That was responsibly picked up and the work carried on under this Government. That’s certainly to be commended, because we are here in this House to make a difference, particularly to our communities. We talk about wellbeing, and this afternoon this is very much addressing those who are particularly vulnerable, who are the desperate, and who are the disparate.
So, in keeping this brief, just to say that in the short time that I was on the committee, the summary is that there were 173 submissions that were made to the select committee, oral evidence heard from 50 submitters, and I would have been present to hear at least seven or eight of those. That this is something that we as a House are united in: commending this bill to the House. I conclude my debate endorsing that.
Dr DUNCAN WEBB (Labour—Christchurch Central): Well, thank you very much, Madam Speaker, and kia ora to the last speaker, Harete Hipango, who put it really very well, I thought. I’ve really got two things I wanted to say here today. The first is that this is a really good example of when we’ve got to intervene in people’s free choice, because obviously these arrangements that are entered into, in many cases—well, in all of those cases—the people enter into them apparently freely. Both debtor and creditor come together and the creditor is happy to offer loans at a thousand percent interest, and it appears that the debtor is happy to take the money.
Now, that strange arrangement that most of us would think is absolutely, you know, nonsensical happens for a number of reasons. Probably the first one is the massive imbalance of power. At one end, there’s simply desperation that if someone can’t get their kids to school because their car is broken, and they need $300, then they put, as anyone would, getting that $300 ahead of the disaster that’s looking at them down the road in terms of how they’re going to repay that. The other thing is that we know that people, actually, in those kinds of situations, strange though it may seem, are optimistic. They think, “Oh well, I’m sure I’ll be able to work it out. I’ll sort that out later. I’ll be able to find the $600 in three weeks’ time that I have to pay back, the interest and the principal and all of the fees that have accumulated.” So what we have there is the fact that people make erroneous decisions.
As Ginny Andersen said, there are predators out there. Some of those people, the lenders, look at that knowing that things are going to go bad—knowing that a high proportion of those loans are not going to be able to be effectively repaid. Quite apart from that, to lend that money, as Harete Hipango said, is usurious. It is immoral. It is absolutely appalling to do that. So we have the Government stepping in in a number of ways to address that, to address the power imbalance, to address the poor decision-making that goes on, the information asymmetry, and all other kinds of market failures that occur in these instances. That’s the first point I want to make about the appropriateness of market intervention here.
The other real point I want to make is that this is a fantastic example of democracy. Minister Faafoi brought a great bill to the select committee—a bill that did a whole lot of good things in many, many ways—but what happened at select committee was that there was a very strong voice from pretty much across the board, from all of the consumers, all of the consumer advocates. The only people who didn’t like it were the profiteers, to say that there should be an interest rate cap. To his eternal credit, Minister Faafoi listened to that, did further work, took further advice, and came out with a much stronger bill. There have been some reservations expressed across the other side of the House, but I must say, on this side of the House, there’s absolutely none. This is absolutely the right thing to do; 0.8 percent per day is still a very, very large interest rate. I find it flabbergasting that there are lenders out there that tell us they can’t make money at 0.8 percent per day.
Simeon Brown: It’s not about the money. It becomes a target.
Dr DUNCAN WEBB: If they can’t make money, if they can’t run their businesses in that situation, then—look, Mr Brown, I can tell you that I went to a lender. It was a great trip with the Hon David Carter. We sat down for over an hour and they told us that one aspect of their lending, their short-term lending, they would simply shut down because at these rates, they wouldn’t be able to make the money they need to make it worthwhile. Now, to me, that’s not a bad thing, because what we also heard through the evidence was that, in fact—whilst people might desperately need this money in the short term—when one stands back, the debt spiral that people get into is absolutely catastrophic. So in the wider scheme of things, prohibiting this kind of money, at absolutely usurious interest rates, is the right thing to do.
In terms of the democracy—to come back to my point—it was outstanding to see a well-organised, carefully thought-out, elegantly presented campaign marshalled by Tim Barnett, ex-MP for that fabulous electorate Christchurch Central and a very good advocate for FinCap, and a whole lot of other people, and it worked. Not some huge lobbyist, just a group of passionate people who had something relevant to say, and something to say in a well-thought-out way, turned it around, got a result that’s better—better for all of New Zealand. So with those two points, that’s really all I want to say. This is a bill that makes our finance and lending law stronger for everyone. I commend it to the House.
Amendments recommended by the Finance and Expenditure Committee by majority agreed to.
Bill read a second time.
Bills
Ombudsmen (Protection of Name) Amendment Bill
Second Reading
Hon ANDREW LITTLE (Minister of Justice): I move, That the Ombudsmen (Protection of Name) Amendment Bill be now read a second time.
This is a very simple bill. It does a very simple job, which is to protect the value—the mana, you might say—of the name of our Ombudsmen. It does so because even though there is a provision in the current legislation that allows others to apply for the use of the name “ombudsman”—and it tends to be in dispute resolution type of services—there was a recent Court of Appeal decision that, effectively, said that because permission has been granted to two outfits to use the name “ombudsman”, therefore any decisions by the Chief Ombudsman to allow the use of that name in the future have to take into account the market advantage the current licensees, if you like, of that name have. It is, in a sense, contradictory to the prima facie prohibition contained in the current legislation on the use of the name “ombudsman” without the permission of the Chief Ombudsman.
So this bill is about protecting the integrity of that name, and I’m going to come to, shortly, what that is actually about. But it is about recognising that the Office of the Ombudsman holds a very important and special place in our constitutional framework and our Public Service framework because they are the kind of go-to people when somebody has a complaint or an issue about the conduct or the service that they have or have not received from a Public Service.
The name goes back 200 or 300 years, apparently. It originates from Sweden, I understand. It means, in its original language, champion for the people or advocate for the people—which is what an ombudsman actually is. It is a person who you can go to for not necessarily low-level but reasonably good advice and a mediatory approach to resolve your problems.
Before I go any further, can I thank the members of the Governance and Administration Committee, who took the submissions on this bill. That select committee received 11 submissions, and six of the submitters spoke to their submission. The submitters engaged with the bill very well. I’m pleased to say that the committee has taken one consideration on board, and recommended a helpful change to the bill. In that respect, the select committee has recommended clarifying the scope of the savings provision of the bill, which allows two existing private sector entities—the Banking Ombudsman Scheme Ltd and Insurance and Financial Services Ombudsman Scheme Inc.—to continue to use the word “ombudsman” in their names; they were granted permission to use the name some time ago, and they will continue to use it. What the select committee has recommended is a form of words that means that if all those entities do is change their corporate structure, they continue to use the name, but if they sell themselves or, you know, they want to get out of the business, then they can’t transfer that name. It applies to the entities, in whatever corporate structure they feel, that currently have the rights to use the name.
As highlighted during the first reading, the bill makes important changes to uphold that public confidence in this very important public role. As I say, the name is meant to be protected, but as a result of two decisions taken by previous Chief Ombudsmen and now this Court of Appeal decision—that, in my view, has distorted the intention of the original provision in the Act and turned it into sort of a presumption that permission to use the name will be granted. Whereas, actually, the presumption is meant to be the other way, and it doesn’t matter if two have got it and other people apply for it and don’t get it—that should not be a relevant consideration.
The easiest way to deal with that is simply to say it’s not going to be used—the name is not going to be used—and it should not be left up to the Chief Ombudsman to be making that decision. So what it will do is, effectively, come back to the Minister of Justice, who is responsible for the ombudsmen legislation, to make any future decision about that. So the name is now restricted. It can only be used by a parliamentary Ombudsman appointed under the Ombudsmen Act, or a person appointed to a position established by the Chief Ombudsman, such as an assistant or deputy ombudsman, or a public sector department or organisation approved by the Minister of Justice. So it will retain its Public Service sort of ethos that goes round the role.
As mentioned, the bill includes a savings provision for two existing entities. They’ve got the name. They’ve used them for a while. We’re not going to take that away. But that is it—that will be it. In future, only public entities can use the name. It includes a savings provision in respect of the private sector entity Financial Services Complaints Ltd. That entity had an application to use the name. It had been knocked back once. They went to court. That led to the Court of Appeal decision. Their right to continue that application is allowed, but that is it. That is the right that is preserved for them, because up to that point, they, in fact, had not been granted permission to use the name, but the Chief Ombudsman must consider that application, in any event.
I’ve laid out the importance of the role, why it is important, and I just think it is important—the two private entities that use the name, the reality is that I get variable commentary about the quality of the service they get. They do not operate to the quality of our Ombudsmen—the genuine public Ombudsmen—and I think it is important, given the totemic role that that office plays as a safety valve, as a place where people can go when they are aggrieved by the conduct of anything in the public sector, that the status of that office and that role of Ombudsmen be maintained. That’s what this bill seeks to do.
So on that note, this bill will continue to signify the uniqueness of the parliamentary Ombudsmen and therefore uphold public confidence and understanding in it, and on that basis, I commend the bill to the House.
CHRIS PENK (National—Helensville): Thank you, Madam Speaker, for this opportunity to speak on the Ombudsmen (Protection of Name) Amendment Bill from the National Party perspective. There’s not a lot that is objectionable about what we’ve just heard from the Minister, except to say that on this side of the House, we don’t regard the need for this legislation in the same way that, clearly, the Government does. We regard it as something of a solution in search of a problem. Notwithstanding that there are situations in which, at least theoretically, there might be a problem arising, I think it might be one of those classic cases where we say, sure, a thing works in practice, but does it work in theory?
It seems to us that there’s not a lot of danger of real, genuine confusion between different offices of the Ombudsmen, official versus unofficial, and so forth, such that there would be a harm that needs to be corrected on the statute book. I note various remedies existing in our law—passing off and fraud, as well, is, as the Minister’s already referred to, in statute already—that prescribe ways that the usage can already be limited. So I think it’s probably sufficient, simply, that we rely on those.
I think as well that it’s worth considering a broader approach to the protections of names if this is an interest that the Government has in terms of law reform. For example, one can have judges of competitions. One could be asked to judge any manner of different things without being a judge with a capital “J” who sits in a courtroom wearing a wig and so forth—at least in the way that we popularly conceive such characters. So it doesn’t seem to be part of a coherent framework of law reform, and, in any case, it would be a relatively minor example of something that would need changing. For all those reasons, we’re not proposing to support its passage and any more use of the House’s time accordingly.
PAUL EAGLE (Labour—Rongotai): Thank you, Madam Speaker. It’s a pleasure to take some time to talk about this, the Ombudsmen (Protection of Name) Amendment Bill. It was brought through the hard-working Governance and Administration Committee, which I am a member of.
Fletcher Tabuteau: Cry me a river.
PAUL EAGLE: A proud member, of course, Mr Tabuteau. But I want to just say that I think the heart of this was around public confidence, and I guess that whilst we may have been led to believe that this was maybe time-wasting or going down a track where we were simply filling up time, it’s important to get this right.
It’s interesting that the term “judge” was used as a comparison, because that’s exactly why we wanted to clarify it, in terms of making sure that for anyone hoping to attach such a name to their operation—entity, or an individual—there was some clarity around that. Certainly, I remember during the submissions process we had several people come in and just talk about their views. We had people who referred to different terms, even around the gender aspect of the name “ombudsmen/man”. So even that was debated, where we were able just to get some clarity on that as a word, have a look at the global context for that term, and then also pick apart the context of those who are using it in Aotearoa New Zealand. So that term, and particularly being led by those, obviously, that are holding the name now, came through. Then we were able to make a decision on saying, “Look, here’s what we have now.”
So we heard the Minister, the Hon Andrew Little, talk about that in terms of keeping those who have it now, let’s keep that, and they gave some very good reasons why. But anyone new or anyone wishing to tag it on—and if I just reflect globally, again, there were several, some humorous, additions for different sectors where people had put the name “ombudsmen” on to the name of the individual or given it some credibility and, therefore, led the public to believe that that entity or that role had probably more, I don’t know, jurisdiction, maybe, or more status, more mana, than the role really should have had. That’s why I think—going back to what I said at the start, in terms of upholding public confidence and why the Governance and Administration Committee spent some time looking at that and the formation of this bill.
We also look at it in terms of the coalition Government’s position. We look at the prohibition—and just to reinforce that, it is to prevent the risk of proliferation. So I’m glad that that was debated, teased out, and sorted. Also, in terms of setting precedent—and the example was the term “Anzac” and, again, public confidence and trust in what the word is attached to. We clarified that. Also, we talked about the uniqueness of the constitutional role in New Zealand that Ombudsmen hold—
Hon David Bennett: Mate, you’re going to do a speech on this?
PAUL EAGLE: —that’s right—and we need to ensure that the significance of that is not undermined by the confusion. So I’m certainly proud that that was talked to, too.
We amend the 1975 Act that’s in place and sort that out, and we went through that on the select committee too. Of course, I’ve mentioned, too, around those who have got the existing—the name that’s been tagged to, now, the Banking Ombudsman’s one. She certainly does a great job and came in and talked through her reasons, and the Insurance and Financial Services Ombudsman, too. So, currently permitted, and they will continue to be used by those two entities. Finally, just the protection of the right of the Financial Services Complaints Ltd [Interruption]—I commend this bill to the House. Kia ora.
Hon DAVID BENNETT (National—Hamilton East): Thank you, Madam Speaker. I thought that the time had nearly elapsed, but this is completely a bill that is of no necessary need and the people of Hamilton won’t want to see this bill progressed at all.
Debate interrupted.
The House adjourned at 6 p.m.