Wednesday, 11 March 2020

WEDNESDAY, 11 MARCH 2020

WEDNESDAY, 11 MARCH 2020

The Speaker took the Chair at 2 p.m.

Karakia.

Voting

Correction—Abortion Legislation Bill

SPEAKER: Members, I need to advise the House of two corrections to the voting on Part 1 of the Abortion Legislation Bill in yesterday’s committee of the whole House. On the amendment in the name of Dr Deborah Russell on Supplementary Order Paper (SOP) 473 to amend clause 7 by inserting new section 19A, the correct vote is Ayes 19 and Noes 99. On the amendment in the name of Chris Penk on SOP 469 to amend clause 7 by amending a new section 20, the correct vote is Ayes 36 and the Noes 82.

Both these corrections are the result of one member casting his proxy vote one way and then voting another way in person. [Interruption] Order! Where a vote conflicts in this way, the vote made in person is the one counted. But I will remind members ahead of the continuation of the committee stage on this bill that they are responsible for how their vote is cast and should be certain that directions given to anyone casting a proxy are entirely clear.

Oral Questions

Questions to Ministers

Question No. 1—Finance

1. Dr DEBORAH RUSSELL (Labour—New Lynn) to the Minister of Finance: What recent reports has he seen on the New Zealand economy?

Hon GRANT ROBERTSON (Minister of Finance): Last week, international credit ratings agency Standard & Poor’s (S&P) published its latest forecast for Asia-Pacific economies, factoring in the potential impacts from the global economic disruption caused by COVID-19. S&P forecasts the New Zealand economy to grow at 2 percent in 2020, rising to 2.9 percent in 2021. This is in line with other guidance from economists in recent weeks. It is important to note that this is a rapidly changing situation. Treasury is currently undertaking detailed scenario analysis of how the global disruption from COVID-19 might feed through to the New Zealand economy as part of the Budget process. The good news is that the New Zealand economy is in good shape as we go into this: net Government debt is at 19.5 percent of GDP—

Hon Simon Bridges: Thank you, National.

Hon GRANT ROBERTSON: —and lower than what we inherited, Mr Bridges. We have forecast surpluses and data showing solid underlying momentum in the New Zealand economy.

Dr Deborah Russell: What reports has he seen on how COVID-19 is affecting different parts of the economy?

Hon GRANT ROBERTSON: Reports from the business community and official data show that the global disruption caused by COVID-19 is feeding through differently to different parts of the economy. The tourism and hospitality sectors and parts of the forestry industry continue to report the most significant impacts. Yesterday, Ministers Twyford, O’Connor, and Nash visited the Nelson region to be updated from businesses on the ground about the impacts of COVID-19. They have reported back that the region is in good shape, in part due to its diversified economy. Companies with exposure to China, like King Salmon, reported that while there had been some initial issues for their exports to China, business was rebounding, and Ministers were told that local businesses in those areas were actually concerned about a shortage of workers. Of course, we will continue to work with businesses in the Nelson region just as we are with businesses right across New Zealand, particularly in areas like Tai Rāwhiti, to ensure we support continued employment, income support, and redeployment options.

Dr Deborah Russell: How is the Government supporting all of New Zealand to work together to respond to the economic impacts of COVID-19?

Hon GRANT ROBERTSON: The best way to mitigate the economic impacts of COVID-19 continues to be our strong and world-leading public health response. Simple but effective tasks like washing your hands properly, sneezing into the inside of your elbow, and staying away from work or public events if you are sick is vitally important, and I think all New Zealanders can be proud of the personal responsibility New Zealanders are showing in regard to this. We continue to urge businesses to remain as flexible as they can for people who are sick, and we continue to work with them and business groups and unions on the business continuity package. This is not just a Government response; it is not just a business or individual response; it is a New Zealand response, and that’s where our values as a country are showing through: everybody prepared to muck in and do their bit to work together to respond to this outbreak.

Question No. 2—Prime Minister

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

Rt Hon JACINDA ARDERN (Prime Minister): Yes, especially the proactive work we are undertaking in response to COVID-19. On Monday, Cabinet agreed to quarantine measures which will mean medical officers of health can quarantine vessels or passengers coming to New Zealand if they believe there are passengers with coronavirus on board. This is in addition to the measures the Government has already implemented, which include travel restrictions, self-isolation, health staff meeting individuals disembarking from international flights at the border, and ensuring the public have information on how to keep healthy. The message I would share with this House is that we all have a role to play, and that does include all members of Parliament.

Hon Simon Bridges: What advice has she received on the number of job losses from the minimum wage increase on 1 April?

Rt Hon JACINDA ARDERN: If the member is referring specifically to any impacts in more recent weeks, we have not received any advice in that regard. As I said in this House yesterday, the most important thing that we can do through this period for businesses affected by COVID-19 is provide them with targeted support. A roll-back of the minimum wage not only hurts low-income workers; it won’t keep people in a job if they are experiencing a massive downturn in custom. Someone could earn less and still be out of the job, and that helps no one.

Hon Simon Bridges: Does she accept that increasing the minimum wage on 1 April will increase the number of people who will lose their job by at least 6,500 people?

Rt Hon JACINDA ARDERN: The Ministry of Business, Innovation and Employment has consistently given advice to successive Governments—including the member’s own—that every minimum wage increase will lead to job loss. Contrary to that advice, when we have increased the minimum wage, we have seen some of the lowest unemployment in this country in a decade. We stand by the fact that we have supported up to 200,000 people getting additional wages because of those increases, and minimum wage increases have a stimulatory effect in the economy—the last one up to a 0.1 percent increase for GDP.

Hon Simon Bridges: Has the advice on the number of job losses as a result of the minimum wage increase on 1 April been updated to reflect the additional impact of coronavirus, which will mean many more thousands of job losses?

Rt Hon JACINDA ARDERN: I already answered that, and if the member listened, I said no.

Hon Simon Bridges: Does she understand her top priority is to keep New Zealanders in jobs and off the dole?

Rt Hon JACINDA ARDERN: Actually, my top priority is keeping New Zealanders healthy, and that is the best thing that we can do for our economy as well. The public health response comes first and foremost, and in addition to that—because that is our best economic defence—and at the same time, we are getting ahead of the wider economic impacts. Not only have we rolled out those business advisory services, worked alongside banks to make sure that they’re supporting cash-flow issues, deployed our regional teams from the Ministry of Social Development, removed stand-down periods, and we are working on a business continuity package to make sure that businesses can keep their doors open through this period. I think it is utterly unreasonable and politicking of that member instead of supporting initiatives that will support business, instead calling for low-wage workers to earn less.

Rt Hon Winston Peters: Could I ask the Prime Minister as to what guidelines she has taken from other Western democracies dealing with coronavirus—[Interruption]—and where has she seen an Opposition politician attacking a Government for the effects of economic and social disasters of coronavirus? Where in the Western World has she seen that?

SPEAKER: No, wait. I want to know who it was who—

Hon Todd McClay: I withdraw and apologise.

SPEAKER: Well, the member is responsible for the punishment that’s going to occur.

Rt Hon JACINDA ARDERN: I have been looking around the world at different responses, both from a public health response but also an economic response. Most of the democracies we compare ourselves to have not put out specific packages like the one we are currently preparing. We have seen Australia talk about an infrastructure package—members in this House will remember it was only a few weeks ago that we put out a $12 billion infrastructure package that will have a stimulatory effect in our economy. I am confident, based on what I’ve seen abroad, that in terms of our economic response and our public health response, we are doing what is in the best interests of New Zealanders. In fact, we have 100 percent contact with all of the contacts relevant to our current known cases in New Zealand of COVID-19. That kind of contact tracing is critical to our current public health response.

Hon Iain Lees-Galloway: Can the Prime Minister confirm that the advice the Leader of the Opposition refers to does not predict job losses but predicts a potential restraint on job growth, but, in fact, still predicts job growth in 2020 of over 43,000 jobs?

Rt Hon JACINDA ARDERN: Again, the member well knows, of course, that we’ve had in excess of 80,000 additional jobs in the economy. So again, that is advice that that member would have received every time that Government increased the minimum wage as well.

Hon Simon Bridges: Does she understand that to keep New Zealanders in jobs, we need businesses in business, and that means halting the record-high minimum wage increases about to happen?

Rt Hon JACINDA ARDERN: For those businesses who are currently experiencing significant downturn in their bookings and in their patronage, what they need is much more than what the member is suggesting. They need wage subsidy and support, they need support with cash flow, they need support with provisional tax. That is a much bigger, more targeted response, and it doesn’t hurt low-wage workers at the same time.

Hon Simon Bridges: Does she have a specific COVID-19 health plan in writing?

Rt Hon JACINDA ARDERN: I want to read from page 1 of the New Zealand Influenza Pandemic Plan, which states—[Interruption]

SPEAKER: Order!

Hon Simon Bridges: I raise a point of order, Mr Speaker. I asked about a specific COVID-19 health plan. The Prime Minister’s—

SPEAKER: The member will resume his seat. The member knows well that he can’t take that sort of point of order until the answer is completed. The member can’t anticipate a complete answer. He’s been here for at least nine years and he should know that.

Hon Simon Bridges: Twelve.

SPEAKER: Twelve, I’m sorry.

Rt Hon JACINDA ARDERN: As I was saying, the New Zealand Influenza Pandemic Plan is comprehensive and states—

Hon Simon Bridges: That’s not a COVID plan.

Rt Hon JACINDA ARDERN: —if the member would like to listen—on page 1, “The New Zealand Influenza Pandemic Plan could reasonably apply to other respiratory pandemics, such as SARS.”

Hon Simon Bridges: UK, Aussie.

Rt Hon JACINDA ARDERN: It is totally relevant. Secondly—

Hon Simon Bridges: It’s generic.

Rt Hon JACINDA ARDERN: If the member is criticising it, he may wish to reflect it was produced in mid-2017 under his Government. Finally, I again want to point out this is a global issue, not the time for scaremongering and politicking like that member continues to do.

Rt Hon Winston Peters: Supplementary question.

SPEAKER: A point of order, the Rt Hon Winston Peters.

Rt Hon Winston Peters: No, it’s a supplementary question.

SPEAKER: Sorry?

Rt Hon Winston Peters: It’s a question.

SPEAKER: Oh, sorry. The member was drowned out—

Rt Hon Winston Peters: You mistook me for someone else, I know.

SPEAKER: That might be a miracle. It might be one of my wishes, but it didn’t happen.

Rt Hon Winston Peters: Anyway, supplementary question to the Prime Minister: in helping business and workers in this country, will she rule out an increase in GST, which Mr Bridges today would not rule out?

Rt Hon JACINDA ARDERN: Yes.

Hon Simon Bridges: Does the Prime Minister regard specific questions about COVID plans as “politicking”?

Rt Hon JACINDA ARDERN: I regard any suggestion that our public health system is not well equipped to deal with COVID-19 to not be in the best interests or a genuine question, because that member well knows that that influenza plan, which has been in place since 2017, is comprehensive. It’s designed for exactly these situations, and not only that; that member also knows we have experts who are, of course, tailoring all of the evidence that we have around COVID-19 specifically to our response now. That is why we are using, for instance, all of the self-isolation and testing regimes that we are—specifically for COVID.

Hon Simon Bridges: When will New Zealanders see a specific COVID-19 plan as Australians have, as British have, and other countries as well?

Rt Hon JACINDA ARDERN: It’s already in operation, and to suggest otherwise is irresponsible.

Hon Simon Bridges: So are reports from officials that they will develop a specific plan, because it’s necessary, wrong?

Rt Hon JACINDA ARDERN: Yes.

Question No. 3—Finance

3. Hon PAUL GOLDSMITH (National) to the Minister of Finance: Does he stand by all of his statements and policies?

Hon GRANT ROBERTSON (Minister of Finance): Yes, and in particular I stand by my statement that I’m proud of how New Zealanders are taking responsibility and working together as we respond to the impacts from the global disruption caused by COVID-19. I also stand by my policy to work constructively with businesses and workers as we continue our ongoing response to COVID-19 through the business continuity package.

Hon Paul Goldsmith: When will money actually reach affected businesses from any short-term wage subsidy he is planning as part of the business continuity package?

Hon GRANT ROBERTSON: As we announced after Cabinet on Monday, we will be releasing the full details next week.

Hon Paul Goldsmith: So can he be more precise: when will money actually reach the affected businesses?

Hon GRANT ROBERTSON: We will be moving as swiftly as we possibly can in designing a scheme that is appropriate to this situation, which is a targeted scheme. Businesses are already able, working through IRD and the Ministry of Social Development in terms of the support of their staff, to access money. There are businesses—

SPEAKER: Order! Order! The member will resume his seat. Some members think this is important, and I want to be able to hear the response. I think it is irresponsible for members, having asked questions, to shout down a Minister who is attempting, in this case, to give a straight answer. Question No. 4—Jan Tinetti.

Hon Paul Goldsmith: Excuse me. I raise a point of order, Mr Speaker.

SPEAKER: Sorry?

Hon Paul Goldsmith: I was raising a point of order.

SPEAKER: A point of order, Paul Goldsmith.

Hon Paul Goldsmith: I think that the reason why there was noise was that I’d asked a specific question about when we would have a date of when money would reach affected businesses from the subsidy, and he was talking about all sorts of other things not relating to the subsidy.

SPEAKER: And why does the member think that’s a point of order?

Hon Gerry Brownlee: Speaking to the point of order. Largely—

SPEAKER: Give us a rough idea of which Standing Order or Speaker’s ruling the member’s referring to.

Hon Gerry Brownlee: Well, surely the Standing Order that can be given that is relevant to the public interest and the public good would be a good place to start for a question. To simply say that we’re making an announcement next week about an announcement that we made yesterday, or some kind of never-never, doesn’t help all those tourist businesses in New Zealand that are suffering right now.

SPEAKER: All right. The member will resume his seat. What the member’s indicating is he doesn’t like the answer. That is generally the case with questions of this type in the House and has been for the last 30 years since I’ve been here. And that is not a point of order. Mr Brownlee knows it’s not a point of order, and he’s testing my patience.

Hon Paul Goldsmith: Supplementary?

SPEAKER: No, I’d called the next question. So the member wants to go back now?

Hon Paul Goldsmith: Yes, Mr Speaker.

SPEAKER: Well, I will—no, I’m not going to seek leave. I’ll go back. I’ll be generous to him. It’s against my inclinations but I will.

Hon Paul Goldsmith: Thank you, Mr Speaker. Is he worried that the window to save jobs is rapidly closing?

Hon GRANT ROBERTSON: As we speak, there is staff from the Ministry of Social Development and the Inland Revenue Department working with businesses. Banks right across New Zealand, which I would have thought the member would have realised are the first port of call for businesses, are working closely with businesses to make sure they stay in employment. Right around the country, the response from New Zealanders to this has been good. We are developing this package in line with business expectations.

Hon Paul Goldsmith: Will a further substantial increase to the minimum wage on 1 April add costs to many businesses?

Hon GRANT ROBERTSON: The increase to the minimum wage has been well signalled. Most businesses will have factored it in already. It is an important element of making sure that low-income New Zealanders are able to spend and provide for their families, and, actually, it’s in small businesses right across New Zealand that that money will be spent.

Hon Paul Goldsmith: Regardless of whether people knew it was coming, will a further substantial increase in the minimum wage on 1 April add costs to many businesses?

Hon GRANT ROBERTSON: Different businesses are affected in different ways by changes that the Government makes. What I do know is that when the minimum wage goes up, as it did under the previous Government and as it has under this Government, people spend more, and for many of those individual businesses, they will come out well and truly ahead.

Hon Paul Goldsmith: Why is he adding costs to businesses at a time when many are struggling to keep their employees in employment?

Hon GRANT ROBERTSON: I totally reject the premise of the member’s question. What we are doing is working alongside the business community to make sure that they are prepared for what may come and supporting low-income New Zealanders to have the money that they need to spend to feed their families, which supports demand in the economy. The member opposed the minimum wage increase for ideological reasons. Now is not the time to politick about it.

Kieran McAnulty: Does he stand by his statement rejecting the idea that this Government will increase GST; if so, why?

Hon GRANT ROBERTSON: I can absolutely say that, and I was quite surprised earlier today to see the Leader of the Opposition fail to rule that out, but I guess anything’s possible with Simon Bridges. [Interruption]

SPEAKER: Order! Is the member finished now?

Question No. 4—Education

4. JAN TINETTI (Labour) to the Minister of Education: What is the Government doing to support schools to manage the impact of COVID-19?

Hon CHRIS HIPKINS (Minister of Education): The Government is supporting schools with links to cases, and schools in general, by making sure that the most up-to-date information is provided to them. Another special bulletin went out on Friday evening to all schools and early learning services across the country, reiterating the key facts about COVID-19 in New Zealand. The bulletin set out the agreed protocol that the Ministry of Education and regional health services have—in particular, who will help schools through each stage of the process if a school, or someone associated with a school, comes into contact with COVID-19. Principals and school leaders have also been provided with templates that they can use to send information to their parent communities to reiterate the current facts around COVID-19 and the key health messages.

Jan Tinetti: What support is the Government providing specifically to supporting schools in Auckland with links to cases?

Hon CHRIS HIPKINS: There are currently four schools in Auckland with links to cases. The Ministry of Education, with support from Auckland Regional Public Health Service, are in frequent contact with the four principals in all of those schools to help them with any queries. Ministry support teams have also been offered to other schools to help on the ground if needed. Information has been provided to the wider Auckland regional schools to ensure there is transparency and that everyone is getting the same messages. The key message for parents to hear is that in the case of all four of these schools, the advice from Health is that it is safe for students to be at school and that those students have not been exposed to COVID-19. As has always been the case, when a child is unwell, they should not go to school.

Jan Tinetti: What is the Government doing to support the most accurate information going out to concerned parents?

Hon CHRIS HIPKINS: The Ministry of Education are working with Auckland Regional Public Health Services to provide tailored communication in a timely manner for parents where that is needed. Government agencies are responding with the latest evidence on COVID-19, and it’s important that everybody in public positions reaffirms this information. We understand and appreciate that parents will voice their concerns, but the very best thing that parents should be doing is getting accurate information from experts.

Jan Tinetti: What feedback has he seen from principals on the Government’s support for schools over the last week?

Hon CHRIS HIPKINS: I have seen some positive feedback from a very unlikely source, in fact. Auckland Grammar’s principal, Tim O’Connor, a known advocate for the Government, has said—

SPEAKER: Order! Order! No irony.

Hon CHRIS HIPKINS: —ha, ha!—that the Ministry of Education and the Ministry of Health have been superb in the advice that they have been giving to schools. I do want to take this opportunity to thank all four school principals for the degree of professionalism they have shown in responding to these cases. It gives great confidence that our education system will be able to respond in that way if there are other cases.

Question No. 5—Health

5. Hon MICHAEL WOODHOUSE (National) to the Minister of Health: Does the New Zealand Influenza Pandemic Plan describe the conditions for moving to the “Stamp It Out” phase as sustained community-level outbreaks in two or more countries overseas and a confirmed human case in New Zealand; if so, have those conditions been met?

Hon Dr DAVID CLARK (Minister of Health): It’s important to continue to keep COVID-19 out of New Zealand at the same time as our public health experts work to contain and stamp out the five confirmed cases we have had. The current version of the New Zealand pandemic plan was drafted under the previous Government and has been tested under this Government. It’s a timely reminder of the importance of everyone playing their part—politicians, businesses, and the public—in following that plan in response to COVID-19. So in answer to the member’s questions, yes and yes.

Hon Michael Woodhouse: When did New Zealand move to the Stamp It Out phase?

Hon Dr DAVID CLARK: It is not only possible but it is, in fact, inevitable that our response to this rapidly evolving situation will span more than one phase of the pandemic plan at a time.

Hon Michael Woodhouse: Can he confirm that the Stamp It Out phase includes an action to provide customised information to overseas visitors in New Zealand, and if so, why are the health cards provided at airports dated August 2014?

Hon Dr DAVID CLARK: The framework that the pandemic plan provides allows for a large number of decisions to be taken in response to specific situations, in response to the first part of the member’s question. In response to the second part of the member’s question, the advice that has been provided does pertain to symptoms of that illness and other illnesses about which the Healthline would like to hear.

Hon Michael Woodhouse: Has the Government considered exit assessment procedures and advice on the risk of exporting disease, as set out in the Stamp It Out phase, particularly given the number of Pacific visitors planning to attend the Pasifika Festival this weekend?

Hon Dr DAVID CLARK: We are receiving advice all the time, and I’m expecting to receive more advice on that matter soon. What I would say is that New Zealand acted decisively and early to put border restrictions in place and expectations of self-isolation, and that has meant that we are amongst the best-placed countries in the world in respect to COVID-19. Part of doing that was noticing and being cognisant of our concern for and desire to protect our Pacific neighbours.

Hon Michael Woodhouse: Given that answer, has he seen the suite of measures just announced by the Australian Federal Government, including increased travel bans for Italy, and what of those does the New Zealand Government consider implementing?

Hon Dr DAVID CLARK: I will take advice from officials on the Australians’ moves. Of course, our advice is updated daily from the technical advisory group. The definition, I’m aware, is being broadened. I would also note that, of course, we moved ahead of Australia on restrictions around Iran, and that has proven to be a good move. We are acting on the best scientific and medical advice, on what doctors advise, at every stage.

Hon Michael Woodhouse: Is the Ministry of Health preparing a specific COVID-19 plan, as was advised by officials in a briefing to Opposition MPs yesterday?

Hon Dr DAVID CLARK: Of course, the pandemic plan that was drafted in 2017 under the previous Government and has been tested under the current Government continues to provide the framework, absolutely—though, of course, at every stage, we are going to tailor that advice to the situation around COVID-19. We are learning day by day new things about COVID-19, and because we’ve taken those stringent and early measures, we are better placed to plan for the situation as it evolves.

Hon Michael Woodhouse: I raise a point of order, Mr Speaker. The Minister did not address the question of whether a specific COVID-19 plan was being prepared, as was advised to members yesterday.

SPEAKER: I thought he said at the beginning that the plan that had been there since 2017 was being adapted on a daily basis.

Question No. 6—Social Development

6. PRIYANCA RADHAKRISHNAN (Labour) to the Minister for Social Development: What steps has the Ministry of Social Development taken to support the Government’s response to COVID-19?

Hon CARMEL SEPULONI (Minister for Social Development): The Ministry of Social Development (MSD) has already stood up rapid response teams in the four most impacted regions: the East Coast, Waikato, Northland, and Bay of Plenty regions. Additional teams will be stood up in additional regions before the end of the week, including Auckland; Central; Nelson, Marlborough, and West Coast; Southern; and Taranaki, King Country, and Whanganui. These teams are actively contacting employers and working with them to support their staff, explain the services and supports MSD can offer, and provide support for clients affected by COVID-19. We have also agreed to the temporary removal of stand-down periods from 23 March. This will ensure faster access to financial assistance for those that apply and are eligible for a main benefit. As I said in the House yesterday, my focus has been on ensuring that MSD remains poised and ready to support those who are able to stay in work, find alternative work, or enter into further upskilling and training if and when required.

Priyanca Radhakrishnan: What other steps has MSD taken to support the Government’s response to COVID-19?

Hon CARMEL SEPULONI: MSD continues to work closely with the Ministry of Business, Innovation and Employment (MBIE) to develop a wage subsidy for employers, as announced by the Prime Minister on Monday. Further advice will be provided to Ministers by the end of this week for discussion at Cabinet on Monday. MSD is also working with the Ministry for Primary Industries and MBIE to explore redeployment options to support people who have been displaced or have reduced hours to work in other local industries. MSD continues to work alongside other Government departments as a key agency supporting the Government’s response to COVID-19.

Priyanca Radhakrishnan: Why is this important?

Hon CARMEL SEPULONI: Ensuring that the welfare system is fit for purpose, which includes supporting people during adverse events by addressing financial hardship and supporting people into work, or upskilling and training, is top of my agenda as Minister for Social Development. It’s important to note that the additional measures I’ve mentioned also build on this Government’s investments in previous years to enhance income adequacy and support people into work through the indexation of main benefits, the lift in abatement rate thresholds, and increasing work-focused case management. All of these measures combined mean that in an adverse event such as the outbreak of COVID-19, the welfare system is better placed to support New Zealanders that might need our help.

Question No. 7—Workplace Relations and Safety

7. Hon TODD McCLAY (National—Rotorua) to the Minister for Workplace Relations and Safety: What advice, if any, has he received on the impact of the 2020 minimum wage increase on job losses?

Hon IAIN LEES-GALLOWAY (Minister for Workplace Relations and Safety): I’ve received no advice that the minimum wage increase will lead to job losses.

Hon Todd McClay: Is the estimate of 6,500 fewer jobs as a consequence of the increase concerning to him?

Hon IAIN LEES-GALLOWAY: It would be, if that was correct, but the member is wrong. What the advice shows is that there may be 6,500 fewer jobs created, but what it also shows is the prediction that 43,600 jobs will be created this year.

Hon Todd McClay: Does it concern him that official advice suggests that the minimum wage increase will impose a $300 million cost on businesses, at a time when businesses are already struggling?

Hon IAIN LEES-GALLOWAY: I think it’s important that we see that money flowing around the economy. At this time, when we need economic stimulus, one of the best things we can do is make sure that low-income people have money in their pockets so they can spend it in the small businesses in their community.

Marja Lubeck: What has happened to the unemployment rate since this Government accelerated increases to the minimum wage?

Hon IAIN LEES-GALLOWAY: Well, when we came to Government, unemployment was 4.7 percent; it is now 4 percent. I can also tell the House that the underutilisation rate has fallen to 10 percent, the lowest in a decade, and wages are rising at the fastest rate in a decade, at 3.6 percent—that’s well above the rate of inflation. All of this puts New Zealanders in an excellent position to weather the economic effects of COVID-19.

Hon Todd McClay: Has he requested any further or specific advice on the impact of this minimum wage increase on 1 April on job losses as a result of the economic impact of COVID-19, and if not, why not?

Hon IAIN LEES-GALLOWAY: What this Government is focused on is supporting businesses and workers. That’s why we have acted quickly to support the tourism and fishing industries—an extra $4 million for the regional business partner programme as well as support for workers and businesses that they will get from the Ministry of Social Development and IRD. Cabinet has approved work to develop a business continuity package targeted at affected businesses, workers, and regions. We can get through this without penalising the lowest-paid workers.

Rt Hon Winston Peters: Can I ask the Minister: is he prepared to share with the National Party the experience of Lee Kuan Yew’s Singapore, Taiwan, and the five Nordic countries who have denied and decried and destroyed this shibboleth decades ago?

Hon IAIN LEES-GALLOWAY: I would enjoy that conversation. I have to say, New Zealand is unlikely to take the kind of steps that Singapore used to short the labour market by having extraordinary increases to the minimum wage, but we will, in a measured way, work alongside businesses to ensure that working people in New Zealand get a fair deal and we focus on being a more sustainable, more productive, and more inclusive economy.

Hon Todd McClay: So the answer to the last question was no, he hasn’t sought any specific advice at all on the impacts of the 1 April minimum wage increase on job losses as a result of the economic impact of COVID-19—no advice at all.

Hon Members: That’s not a question.

SPEAKER: Yeah, very good point. Question No. 8, Jenny Marcroft.

Hon Todd McClay: I raise a point of order, Mr Speaker. I asked him to confirm, was his—

SPEAKER: No, no, no, you didn’t. You said “so”. So is—

Hon Todd McClay: “So has he”—can he confirm?

SPEAKER: The member—

Hon Todd McClay: “So is the answer”—

SPEAKER: No, look, the member will resume his seat. There was not—Jonathan Hunt used to say it in a way like an old quizmaster, and so did Lockwood Smith: the questions start with a question word, and “so” is not a question word. Jenny Marcroft.

Jenny Marcroft: Thank you, Mr Speaker.

Hon Todd McClay: I had one more supplementary, Mr Speaker.

Hon Member: So?

SPEAKER: All right. I think, in this case it’s “slow”, but we’ll let the member go.

Hon Todd McClay: Thank you. Does he agree with the economist Shamubeel Eaqub on the minimum wage increase in respect of COVID-19—and I quote—“I think they should delay it. It will add significant increase to wage costs for hospitality businesses that will be reeling from the tourism fallout and potential recession.”?

Hon IAIN LEES-GALLOWAY: I note that various economists have had various views. I agree with former BNZ chief economist Tony Alexander, who said that delaying the increase would not be the right move because doing so would affect businesses across the economy, including those feeling little effect from coronavirus. “It would not be a targeted response, and asking people on the lowest levels of earned income to sacrifice”.

Question No. 8—Seniors

8. JENNY MARCROFT (NZ First) to the Minister for Seniors: What actions is she taking to promote the use of the SuperGold card in regional New Zealand?

SPEAKER: She’s sending me on a trip, is she?

Hon TRACEY MARTIN (Minister for Seniors): Ha! On Monday, I was in Nelson to mark the start of an initiative to boost the SuperGold card in both the Nelson and Manawatū-Whanganui regions. Yesterday, approximately 5,000 people in Nelson and 17,000 in the Manawatū-Whanganui area were emailed to let them know about the SuperGold discounts and offers close to them. These are the first two areas where specific, dedicated regional pages have been created on the SuperGold website so that the cardholders can more easily see how they can stretch their dollar in businesses just around the corner. In Nelson, for example, there are around 200 businesses offering SuperGold deals and discounts, and in the Manawatū-Whanganui, that figure is closer to 500. This Government is dedicated to helping our 65-pluses get the best value from their SuperGold card via the new app and the website.

Jenny Marcroft: How have New Zealand’s over-65s reacted to the SuperGold app and website?

Hon TRACEY MARTIN: I think some of those people who are cynical about older people’s use of technology would be surprised. We know that around half of our 65-pluses use smartphones and over half a million use the internet. More than 108,000 people have now downloaded the SuperGold app, and there have been well over 340,000 visits to the upgraded website since 1 October, when these were launched by myself and the Rt Hon Winston Peters. We are going to continue to upgrade and make improvements to both the app and the website to continue to ensure they are both user-friendly. I want to ensure that every SuperGold cardholder knows that there are opportunities close to them to gain a discount, regardless of where they live in New Zealand. It’s also a way of reminding people that the app is here, it’s easy to download, and it was designed with over-65-year-olds to ensure that it is easy to use.

Jenny Marcroft: What has the reaction from business been?

Hon TRACEY MARTIN: Again, it’s been exceptionally positive. There are 775,000 consumers who are over 65 years old—775,000 consumers who have a SuperGold card. The businesses I talk to recognise that the card, the website, and the app provide them with a great way of reaching this group. During the process of revitalising the card and building the app, 500 new businesses signed up to provide SuperGold offers, and another 117 have joined since 1 October. There will be a business recruitment campaign in April and May, and I’m hoping that this will see more firms join the SuperGold family.

SPEAKER: What—no more?

Question No. 9—Regional Economic Development

9. CHRIS BISHOP (National—Hutt South) to the Minister for Regional Economic Development: Why did officials from the Provincial Development Unit spend $1.03 million in the 2018/19 year on travel, accommodation, meals, and other expenses, and how many launch events for Provincial Growth Fund projects did this spending relate to?

Rt Hon WINSTON PETERS (Deputy Prime Minister) on behalf of the Minister for Regional Economic Development: The member’s question is factually incorrect by $366,000. In total, $844,631 was spent on these expenses in the 2018-19 year; $187,389 on accommodation, meals, and incidentals.

Chris Bishop: I raise a point of order, Mr Speaker. What about the second leg of the question, which was about launch events for the Provincial Growth Fund projects?

Hon Chris Hipkins: Mr Speaker, if there are two legs to a question and the premise upon which the second leg of the question is the first leg of the question and the Minister has said that the first leg of the question is wrong, then he can’t really answer the second part of the question.

SPEAKER: I—

Hon Gerry Brownlee: Speaking to the point of order—

SPEAKER: No.

Hon Gerry Brownlee: Well, Mr Speaker—

SPEAKER: The member’s winning at the moment.

Hon Gerry Brownlee: Oh, OK then.

SPEAKER: I don’t accept the submission of the Leader of the House. The fact that the first part is not absolutely accurate does not rule out the second part. If the answer is something less than the first part, the second part can stand, even if there is an assumption in there that it all relates to launch events, which itself I don’t think has been authenticated.

Rt Hon WINSTON PETERS: On behalf of the Minister, these events are not parked up in Sydenham or Fendalton or, dare I say it, Remuera and Epsom; they are out in the real world, from Kaitāia to Invercargill, where we have people—

Hon Paul Goldsmith: It’s not real?

Rt Hon WINSTON PETERS: —placed all over the country, and despite that, on the ground—I know you haven’t been out and about in Epsom. You wouldn’t know what a hammer looks like, or a shovel, or, for that matter, what a business looks like. He has no business experience at all—at all. But my point is that in this year, 52 funding announcements were set around these events—52.

Chris Bishop: How did a unit of just over 100 people manage to rack up spending on flights and dinners and hotels of a million dollars in just a year?

Rt Hon WINSTON PETERS: On behalf of the Minister, again the member’s got his figures wrong. The figures are $844,000. So that’s not a million dollars. But I know that his only background experience is selling tobacco, so what would he know about a real business. Snapchat that. [Interruption]

Hon Gerry Brownlee: I raise a point of order, Mr Speaker. [Interruption]

SPEAKER: Hang on, hang on. I want some settling and I want to think about that one, but, while I’m thinking about it, I’ll hear from Mr Brownlee.

Hon Gerry Brownlee: Mr Speaker, at the moment, the Deputy Prime Minister is speaking on behalf of the Minister who has a delegation for regional development. The Minister for Regional Economic Development has answered written questions providing the numbers that are being used by my colleague Mr Bishop in this question and were provided to the Clerk’s Office in authentication of the primary question. Are we to take it now that the Minister answering for the Minister is saying the Minister himself was wrong all along?

SPEAKER: On that particular question, there’s clearly a matter of debate, and there may be an inaccuracy or people might be using different definitions, and I’d remind the member that the Deputy Prime Minister, who is currently acting to answer this, can occasionally work things around to a different way of defining things or pick up figures in different ways—he has some experience in it. But, if there’s a clear error, then I would expect either the Minister answering the question or, on the next occasion he comes to the House, the Minister in charge to deal with it. Having said that, while Mr Brownlee was on his feet having called a point of order, the Deputy Prime Minister continued and I think made an unbecoming reference to a member, and he will stand, withdraw, and apologise.

Rt Hon WINSTON PETERS: I withdraw and apologise. Can I answer the question? [Interruption] Can I answer the question, Mr Speaker?

SPEAKER: Hang on. I’m just trying to work my way back—yes, there was an interruption, so yes.

Hon Paula Bennett: He keeps being personally abusive.

Rt Hon WINSTON PETERS: Oh, listen to this.

SPEAKER: Order! The member will resume his seat. I made a ruling—all right?—and my ruling was the member was interrupted by a point of order. I don’t expect my ruling to be criticised by the member from her chair.

Hon Paula Bennett: I raise a point of order, Mr Speaker. I certainly was not questioning your ruling in one way or the other. I was making the point that all the Minister does when answering is be personally abusive because he doesn’t have answers. But that’s not questioning you, sir.

SPEAKER: That’s still not a point of order.

Rt Hon WINSTON PETERS: Thank you, Mr Speaker. Back to sanity. The costs of the Provincial Growth Fund’s development travel unit and accommodation are reflective of a dynamic programme which engages with the provinces and the regions and does not leave them to rot, stagnate, and decay. Now, here’s the challenge: in contrast, 20 Cabinet Ministers in last year’s Cabinet spent $1.2 million—that’s 20 Cabinet Ministers—116 officials, in the last year of comparison, spent $844,000. Now, the travel costs are the lowest admin rate possibly in the Western World’s democratic history—0.028 percent for a $3 billion programme. Stop being so mealy-mouthed.

Chris Bishop: What steps, if any, is he taking to rein in the travel activities of the Provincial Development Unit?

Rt Hon WINSTON PETERS: On behalf of the Minister, frugality and thrift is our middle name, and we spend all of our time telling our officials not to waste money, as they were wont to do under a prior administration.

Chris Bishop: How many staff attended the event to mark the reopening of the Napier to Wairoa rail line in June last year, which so far has had the grand total of three trains run down it?

Rt Hon WINSTON PETERS: On behalf of the Minister, that the member wanted to have an answer to that question, given there have been so many—that is, scores and scores of events—as to how many turned up to this one event, was an endeavour not seeking an answer but just to showboat in Parliament. However, what I can say is there were literally hundreds and hundreds—dare I say it, thousands—lining the railways from Wairoa to Napier as it was reopened. I know that because I’ve seen all the photographs and all the pictures. And, then, of course, you’ve got all the local government politicians and mayors, mainly whom are National, saying it’s a fantastic and very sound idea.

Chris Bishop: Why are the hundreds of people who apparently lined the route to welcome the reopening of the line not using the $6.2 million line that has just been reopened?

Rt Hon WINSTON PETERS: On behalf of the Minister, when you have a circumstance where the prior Government let a railway line cease operations on the basis that they wouldn’t spend one cent to fix it up, and when a Government comes along later with all that atrophied business and all that development commerce having been delayed, it takes a while to get things back going again. But he will not find one local body politician or mayor from Wairoa or Napier—nor the whole Hawke’s Bay, for that matter—who is not on this Government’s side in the case of that railway line. But if the National Party’s view is that it should be closed, why don’t they say so?

Chris Bishop: Does he think New Zealanders would find it galling that officials have spent $1 million on travel and expenses at a time of huge economic uncertainty?

Rt Hon WINSTON PETERS: On behalf of the Minister, having proven that that was false in the first place, when he said the word “galling” I wasn’t too certain whether he meant Gauloises, because that’s a French cigarette, and he would have been selling that in his past life as well.

Chris Bishop: Why does he continue to insist that my figures are wrong, when questions for written answer Nos 1906 and 1900 clearly state that travel, meals, and incidentals add together to $1.03 million?

Rt Hon WINSTON PETERS: The member just put his finger on the problem. He didn’t say “meals”; he said “travel”. Now, come on. He said, countless times, “travel”, and now—of course, he’s not of a very athletic business mind—he’s got caught out.

Question No. 10—Health

10. TAMATI COFFEY (Labour—Waiariki) to the Minister of Health: How has close-contact tracing work progressed for the five confirmed cases of COVID-19?

Hon Dr DAVID CLARK (Minister of Health): I’m advised that all known close contacts of the five confirmed cases have now been contacted. Daily contact is being maintained by Auckland Regional Public Health Service. As of yesterday, 193 close contacts have been traced and contacted and given advice on self-isolation; 763 casual contacts have been contacted by Auckland Regional Public Health Service. This is what good public health practice looks like. I want to thank all those who are working on contact tracing to help protect the public.

Tamati Coffey: Are all close contacts now in self-isolation, and how are they being supported?

Hon Dr DAVID CLARK: I’m advised that all close contacts have been told to go into self-isolation. They are checked in with daily. These phone calls are being done by Auckland Regional Public Health Service, and include symptom checks. In addition, close contacts are provided with Healthline contact details and links to the Ministry of Health and Auckland Regional Public Health websites for additional information.

Tamati Coffey: What additional work has been done with people who may have come into casual contact with confirmed cases of COVID-19?

Hon Dr DAVID CLARK: As of yesterday afternoon, 763 casual contacts had been contacted. Expert advice is that these people don’t need to be in self-isolation but do need to be alert to the symptoms of COVID-19 and get in touch with Healthline or phone their GP if they have any concerns. Auckland Regional Public Health Service have a team of people that support public and medical queries, and a case and contact team to respond to queries. In addition, Healthline contact details are available on the MOH—Ministry of Health—and Auckland Regional Public Health Service websites for people to access additional information.

Hon Michael Woodhouse: How many of the close contacts that the Minister referenced were identified from the mosh pit at the Tool concert last week?

Hon Dr DAVID CLARK: As the member knows, those people who were in that situation have been identified as casual contacts.

Question No. 11—Social Development

11. Hon LOUISE UPSTON (National—Taupō) to the Minister for Social Development: What, if anything, is she doing to prepare the welfare system for the impacts of the coronavirus outbreak?

Hon CARMEL SEPULONI (Minister for Social Development): The Government has already taken strong action to support the economy in response to COVID-19 and is rolling out a comprehensive plan, including: working with industry to support affected businesses, including an $11 million tourism package; agreeing to a business continuity package; and directing work on an economic stimulus package building on the already announced $12 billion New Zealand Upgrade Programme. As mentioned in my response to oral question No. 6, the additional measures announced to date that the Ministry of Social Development (MSD) is specifically leading or actively contributing to are: standing up rapid response teams in the most impacted regions; the temporary removal of stand-down periods from 23 March to ensure faster access to financial assistance; and working alongside the Ministry of Business, Innovation and Employment to develop a wage subsidy option for employers and on redeployment options. We will continue to monitor the situation to ensure that MSD is poised and ready to support those who are able to stay in work, find alternative work, or enter into further upskilling and training if and when required.

Hon Louise Upston: Why did she state in the House yesterday, and I quote, “I haven’t been alerted to the need for forecasts at this point.”, and has someone now alerted her?

Hon CARMEL SEPULONI: I said in the House yesterday that I had not received any updated forecasts with respect to jobseeker benefit numbers. That was the question that was put to me. I also said that we are expecting the forecasts—the benefit forecasts would next be completed as part of the Budget Economic and Fiscal Update, which is set to be published on 14 May 2020.

Hon Louise Upston: Does she not consider it important to ask officials for the expected increase in the number on jobseeker benefit?

Hon CARMEL SEPULONI: That member will be aware of the fact that forecasts are done in line with Treasury at particular intervals, and at this point, I have not been alerted by Treasury—

Chris Bishop: Do your job.

Hon CARMEL SEPULONI: —for the need to update forecasts prematurely. [Interruption]

SPEAKER: Order! Order! The member will stand, withdraw, and apologise. Dr Smith.

Hon Dr Nick Smith: What for? What have I done wrong?

SPEAKER: For reflecting on me. The member knows—

Chris Bishop: I think it was me.

SPEAKER: I apologise to both members for mixing them up.

Rt Hon Winston Peters: Point of order.

SPEAKER: No, I’m getting a withdrawal and apology from this member first.

Chris Bishop: I apologise. Well, I withdraw and apologise.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. The Hon Nick Smith certainly made a comment during that question time, and he knows what it was.

Hon Dr Nick Smith: It wasn’t unparliamentary.

Rt Hon Winston Peters: Mr Speaker, do you want to hear what he said?

SPEAKER: No, I don’t. If the member thinks it’s unparliamentary, we’re not having—

Rt Hon Winston Peters: Well, it’s against Standing Orders. That’s why he should apologise.

SPEAKER: I’m quite certain that I’ll go back and listen to the tapes and look at the television on this, and if I need to take further action I will.

Hon Louise Upston: If she has no advice on the impact of coronavirus on jobseeker support numbers, how can she be preparing her department?

Hon CARMEL SEPULONI: The question in the House and the one that the member is referring to was whether or not I had received forecast figures around jobseekers benefit, and I haven’t. We are all, as a Government and Government agencies, making sure that we are prepared. It’s important, as a Government, that we do not panic and we do not incite panic from New Zealanders but that we respond accordingly. So the additional measures I talked about are integral to making sure that we are prepared. But can I say also that they build on some of the investments we already made as a Government to invest and ensure that our welfare system is fit for purpose, including the investment in 263 more front-line case managers to make sure that we can have that work focus that we need.

Hon Louise Upston: When will the Minister ask for an impact of coronavirus on the number of jobseeker benefits if she’s serious about preparing her department?

Hon CARMEL SEPULONI: If I receive advice from Treasury that that is required, then I will welcome that information. For now, I’m set on making sure that as a Government agency, we don’t panic, but that we are out in the regions, are supporting employers, supporting business, and supporting our clients and New Zealanders that may be affected to ensure that they are taken care of, whether it be through financial assistance or whether it be with respect to support into employment, upskilling, and training during this time.

Hon Louise Upston: Is she not concerned about the significant impact that this coronavirus outbreak will have on the country and taxpayers, with an increase on those going on to the dole?

Hon CARMEL SEPULONI: I think, as a House, we are all concerned about the potential impacts of coronavirus, but what we’re trying to do as a Government is ensure that we are poised to respond as the situation unfolds, that we are prepared, that we are proactive, and that we are putting appropriate measures in place. I believe that we are doing that. We want to make sure that we do not throw industry or New Zealanders who are in the workforce into panic. We just want to be there to support them and to ensure that we can get through this appropriately.

Question No. 12—Education

12. Hon NIKKI KAYE (National—Auckland Central) to the Minister of Education: Does he stand by all his statements and actions?

Hon CHRIS HIPKINS (Minister of Education): Yes, in the context in which they were made.

Hon Nikki Kaye: Does he stand by his statement, in response to fears regarding coronavirus that lost fees could wipe out the surplus of the entire university sector, that comments were alarmist given the sector is projecting up to $300 million a year in losses?

Hon CHRIS HIPKINS: Those comments are very premature. The overall impact on the university sector will largely depend on when the travel restrictions are removed and the proportion of students who had intended coming to New Zealand—the proportion of those who continue to come here.

Hon Nikki Kaye: Does he stand by his statement that comments were alarmist and that those comments were premature given that the universities of New Zealand have written to the Tertiary Education Committee projecting that scenario of $300 million of losses within the next seven or eight weeks?

Hon CHRIS HIPKINS: Yes, I do believe they are alarmist. I also believe they were premature. Of course, the position of the universities is that there should be no travel restrictions at all.

Hon Nikki Kaye: Is he ruling out a financial support package for education providers to deal with the impact of coronavirus?

Hon CHRIS HIPKINS: No, but at this point I believe that is premature.

Hon Nikki Kaye: Does he stand by his decisions around education providers and coronavirus given the real issues of delays around visas and returning students, and will he do anything to prevent that?

Hon CHRIS HIPKINS: If the member is arguing that we should remove the travel restriction, I think the majority of the country would disagree with her.

Hon Nikki Kaye: Does he stand by his statement regarding adequate support for education providers impacted by coronavirus, given the real communications by agencies and schools and the issues raised with that and the real need for greater financial support for tertiary institutions?

Hon CHRIS HIPKINS: I’m not sure which one of those questions the member wants me to answer. I am confident that the schools, early childhood centres, and tertiary institutions are being given very good, sound advice by public health officials about how to deal with any consequences of the coronavirus. I am also confident that there is existing financial means for the providers to cope with this situation in the short term. Of course, the overall financial impact is going to depend on how long it goes on for.

Question No. 13—Social Development

13. NICOLA WILLIS (National) to the Minister for Social Development: How many subsidies did Work and Income pay under the childcare assistance programme in the year ended June 2019, and how does this compare with the number of subsidies paid under a National-led Government in the year ended June 2017?

Hon CARMEL SEPULONI (Minister for Social Development): As at June 2019, there were 33,072 childcare and Out of School Care and Recreation (OSCAR) subsidies, including the guaranteed childcare assistance. As at June 2017, there were 42,989 subsidies. A key reason that the number of childcare and OSCAR subsidies has decreased is that many families’ incomes have increased under this Government. We are providing more support to families through our Families Package, which is the biggest boost in household income in a decade for thousands of families. We’ve also increased the minimum wage, rising to $18.90 as of 1 April, have increased the amount people can earn before their benefit is reduced, and have indexed main benefits to wage growth.

Nicola Willis: Does the Minister really mean to tell struggling Kiwi families that it is a good thing that fewer of them are receiving help with childcare costs?

Hon CARMEL SEPULONI: I do need to point out that since 2011, there has been a steady decline in those accessing childcare assistance subsidies. So it is not a new phenomenon. However, I will say that childcare assistance is one of the areas that we cited in our Cabinet paper on our response to the Welfare Expert Advisory Group as one of the areas that we should be reviewing, and we have highlighted it as an area that we want to investigate, explore, and review in our longer-term plan.

Nicola Willis: Can she confirm that while the number of Kiwis on the dole is increasing, her Government is overseeing a reduction in the number of families getting the childcare support that could help them stay off welfare and stay in work?

Hon CARMEL SEPULONI: I can’t confirm the numbers around that thing called “the dole”, because there is no such thing, but what I can confirm is that, actually, we’ve got an unemployment rate of 4 percent, which is the lowest that it’s been in a decade. We’ve got a working-age population on benefit, which is about 10.5 percent, which is relative to every year that the previous Government were in place, or better. And, as I said, we continue to monitor the situation, and we will be reviewing childcare assistance because we recognise the importance of it.

Nicola Willis: Does the Minister think that childcare costs can be a barrier for parents moving off the dole and into work, and is she concerned that, under Labour, around 10,000 fewer childcare subsidies are being paid to low-income families?

Hon CARMEL SEPULONI: What I can confirm is that there were actually 10,000 fewer childcare subsidies being paid out under the previous Government between 2011 and 2017. We recognise that there does need to be a review of childcare assistance and have outlined it really clearly in our Cabinet paper. We recognise the importance of childcare assistance with respect to supporting people into employment. I will say that we’re really proud of the fact that we’ve put additional money into the pockets of low- and middle-income New Zealanders through our Families Package.

Nicola Willis: Does she agree with Carmel Sepuloni MP, who said in 2015 that “We know that, at an operational level, Work and Income are making it as hard as possible for parents to access their childcare subsidy entitlement.”, and if so, is she proud of the drop in childcare subsidies on her watch?

Hon CARMEL SEPULONI: What I’m really proud of is that from April last year, the Ministry of Social Development (MSD) engaged in a proactive programme of phoning primarily sole parent beneficiary recipients to make sure that they were getting access to their full and correct entitlement—and this is above and beyond their business as usual—and making sure that they were getting access to things like childcare assistance subsidies. The fact that it has reduced because incomes have gone up is something we do need to keep a close eye on. We do need to review childcare assistance subsidies, but I’m proud of the fact that incomes have gone up under this Government.

Nicola Willis: Does she agree with Carmel Sepuloni MP, who said, “If more people are going to work, we should see some kind of increase in the number of people not on benefits receiving childcare subsidies”, and if so, what has she done about the drop in childcare subsidies on her watch?

Hon CARMEL SEPULONI: That member that she refers to was a good Opposition member, and she highlighted very important issues. Can I say, as I mentioned earlier, that there had already been a steady decline in the take up of childcare assistance subsidies under the previous Government. We haven’t been able to get on to everything that we would have liked to in the first two years, but I have already indicated in the Cabinet paper that responds to the Welfare Expert Advisory Group’s recommendation that it is part of our work programme—it is a commitment.

Nicola Willis: Why did the Minister make such a big deal about correcting her written answer yesterday when all she did was swap the word “client” for the word “subsidies”, and can she actually tell this House clearly whether more or fewer families are getting childcare support under Labour?

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. I know it’s getting late and we want to see the end of this question time, but that member has constantly got up and asked two separate questions, and we don’t feel like indulging her any longer. Either get a finger on the Standing Orders or don’t ask the question in the first place.

SPEAKER: Right. I have had requests from both sides of the House to be a little bit more flexible in my interpretation of the rules. I think it’s fair to say that it’s mainly been in respect of one member, but has also involved members not very far away from the member who took that point of order. It is a relatively rare occurrence for the newer members of the backbench to have supplementary questions, and I’m deliberately being kind to them—and a little bit loose—and I’m sure that over time they will get it right.

Hon CARMEL SEPULONI: I thought it was important because I think it’s important that we are accurate in this House, and there is a difference between the number of subsidies versus the number of clients, so I needed the accurate information. Can I say that I did receive 4,300 written questions over the last calendar year, and so I think the fact that we only had to correct one question in the House is actually something MSD and my officials can be very proud of.

Question No. 9 to Minister

CHRIS BISHOP (National—Hutt South): I raise a point of order, Mr Speaker. I just seek your guidance in relation to question No. 9 and the written questions that form the basis of the question. My office has just received an email from the Minister’s office—after the question was asked and answered by the Deputy Prime Minister on behalf of the Minister for Regional Economic Development—taking issue with the numbers used in the question. I won’t get into the details of it, but it goes into whether or not the overall number is inclusive or if you can add the two numbers together. I’m just seeking your guidance as to how that plays out in relation to the correction of answers or the correction of the primary question in the first place, because it was never challenged by the Minister’s office when it was put down on notice; in fact, it wasn’t even challenged last night or later on this morning. So I just seek your guidance on that.

SPEAKER: I’m not sure of the advice the member’s seeking. The member’s received an email after a question has been asked from a Minister’s office about the general subject area.

Hon Gerry Brownlee: Can I speak?

SPEAKER: Sorry, I’ll stand up, because that’ll mean that Nick Smith might stop interjecting while I’m attempting to rule. What I don’t understand is the matter that I’m being asked to rule on. I ask Mr Bishop to be more specific about the Standing Orders or Speakers’ rulings that I’m being asked to address. I will remind him, and I think it’s somewhere around Speakers’ Rulings 20/2 or 20/3, that the House doesn’t go back, and so I’m after what the Standing Orders issue is and the remedy that the member’s seeking.

CHRIS BISHOP (National—Hutt South): Well, I suppose what I’m saying is I’m uncertain as to whether or not the Deputy Prime Minister or myself have misled the House, and if you require from us any effective, you know, way of making that right so that we don’t fall foul of the Standing Orders.

SPEAKER: Right. Well, I think it’s fair to say that, on the first matter, I have accepted a question with the authentication which I considered appropriate, and, if I’ve made a mistake, well, I do apologise to the House. Therefore, I think it’s fair to say that unless there is a further misleading by way of supplementary questions, that member’s off the hook. If the member answering the question has made an error, he knows well how to sort it out, and there’s no matter for me to currently rule on.

Sittings of the House

Sittings of the House

Hon CHRIS HIPKINS (Leader of the House): I move, That the sitting of the House today be extended into tomorrow morning for the committee stages of the Taxation (KiwiSaver, Student Loans, and Remedial Matters) Bill and the Smoke-free Environments (Prohibiting Smoking in Motor Vehicles Carrying Children) Amendment Bill, the continued first reading of the Smokefree Environments and Regulated Products (Vaping) Amendment Bill, the first reading of the Electoral (Registration of Sentenced Prisoners) Amendment Bill, the first reading of the Regulatory Systems (Transport) Amendment Bill, and the first reading of the Organic Products Bill.

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

Ayes 63

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

Noes 57

New Zealand National 55; ACT New Zealand 1; Ross.

Motion agreed to.

Debate on Budget Policy Statement

Debate on Budget Policy Statement

Dr Deborah Russell (Chairperson of the Finance and Expenditure Committee): I move, That the House take note of the report of the Finance and Expenditure Committee on the Budget Policy Statement 2020.

I’m pleased to present the report of the Finance and Expenditure Committee on the Budget Policy Statement and the Half Year Economic and Fiscal Update, both of which were presented by the relevant Minister and ministries in December 2019. I’d like to thank the committee for the work they did reviewing these important documents, and I’d like to thank the Minister of Finance, the Hon Grant Robertson, and the Secretary to the Treasury, Dr Caralee McLiesh, for appearing in front of our committee to answer our questions.

I would especially like to thank the submitters who put in submissions on the documents. Forty-two individuals or groups took the time to present their views to us on the Budget Policy Statement and on what they thought we should be doing. Many of those were from representative bodies, so it represents a large number of New Zealanders who took an interest in what is happening in Budget 2020. I especially, though, thank those who came and spoke to us in person. It’s an important part of the Budget process and an important part of the functioning of our democratic system.

This Budget Policy Statement and, of course, the Half Year Economic and Fiscal Update were prepared last year. We reviewed them in February this year, just a month or so ago, and since then much has changed. In December 2019, I don’t think we’d even heard the term coronavirus in respect of the illness that broke out in China. By February 2020, when we were starting to review the Budget Policy Statement, we had just started to use the word COVID-19, and now, coming up for nearly a month later, of course, COVID-19 and its impact on New Zealand and on the world is being regarded as a very serious matter indeed. But what this report shows is just how very well we are placed to meet the challenge posed to us by COVID-19. Let me turn to the Budget Policy Statement to show why this is so.

First of all, I want to talk about how the Budget Policy Statement builds on the work that we did in 2019. It focuses on wellbeing, and that’s important because it means we are moving beyond measuring just the economy and focusing on what really matters to New Zealanders, the traditional things: housing, jobs, families, and so on—all those sorts of things that ensure that people have the capabilities to live lives of purpose, of balance, and of meaning to them.

This Budget in 2020 draws on the work that we did in the Wellbeing Budget of 2019, and it draws on a long tradition of considering what makes a life worth living. What we know when we talk to people—this is well-established in the literature—is it’s not money, though money does help. It’s family, it’s friends, it’s satisfying work, it’s security, and it’s health. Understanding that gives us our focus on wellbeing and it has enabled us to identify priorities for Budget 2020. So the Minister of Finance has identified those in the Budget Policy Statement and they are reflected in our report.

So what are the priorities for Budget 2020? They are a just transition, supporting New Zealanders into a climate-resilient future, the future of work, enabling all New Zealanders to benefit from new technologies, and to lift productivity. It’s the focus on Māori and Pasifika, lifting Māori and Pacific incomes, skills, and opportunities; a focus on child wellbeing; reducing child poverty and improving child wellbeing; a focus on mental and physical wellbeing; and improved health outcomes for all New Zealanders.

That’s the focus that is talked about in the Budget Policy Statement and it builds on the strong economy—a strong economy in which wages are up 4.9 percent, a strong economy in which the minimum wage will be going up to $18.90 an hour, a strong economy in which household incomes are up, a strong economy in which debt is low at 19.5 percent of GDP, a strong economy in which unemployment is at 4 percent, and a strong economy in which growth is ahead of our OECD partners. It was raised at 2.2 percent growth in December, and just today we’ve heard that it is still being raised, at 2 percent growth. At the time of our HYEFU, the Half Year Economic and Fiscal Update, it was predicted there would be a small deficit for the year ended December. In the event, the actual financials have shown a small surplus.

This is the fundamentally sound and strong economy, which means that we are very well placed to meet the threat of COVID-19. We are facing an international storm, but we can meet it. And why can we meet it? It will have a profound effect on us and we are responding. It is a health issue primarily, but it also is an economic issue, and we can meet it. Why can we make it? Because of the programme that is laid out in the Budget Policy Statement in 2019.

So what’s the best thing to do when facing that kind of economic storm? The Budget Policy Statement 2019 tells us what we are doing. We have the New Zealand Upgrade Programme, a Keynesian measure that will support our economy—$12 billion of infrastructure. So after the nine years of neglect, we are doing the work that sorely needs to be done in New Zealand. So there are upgrades for transport, for education, for health.

The Budget Policy Statement tells us that there will be $6.8 billion going into rail and roads, but not just roads for cars, but roads which have dedicated lanes for freight, roads which have cycleways and pedestrian walkways incorporated into them so that different modes of transport can be used to get us about from place to place.

In the Budget Policy Statement, we are told that there will be $300 million going into investment into our district health boards, that sorely needs investment to replace the rundown infrastructure that was left to us. There is $200 million going into reducing carbon emissions in the public estate, making sure that in the Government—in the Government—estate, in the public estate, we are moving towards a low-carbon economy.

Four billion dollars is going to the multi-year capital allowance to look at future spending and support future spending on infrastructure, and all of this will add 1.4 percent to GDP, a 1.4 percent that will be so needed in the face of COVID-19. So what we have here is fiscal policy that is supporting our economy.

Let me tell you how this works on the small scale, and it’s most easily seen in our schools package, the package where we have fired $400 million into repairs and maintenance and upgrading school property. That is affecting virtually every State school in the country. In my electorate, and in the electorate of every single constituency MP in this House and in the electorates where list MPs work, there are schools who are benefiting from this, schools who can at last replace the school pool, can get some painting work done, can get the roof replaced.

But it is not just the schools who benefit from that; it is the local tradies—the plumbers, the roofers, the builders—who will get work, the kind of work that enables them to employ people, and that will sustain us through this COVID-19 outbreak. It is a classic measure to support the economy.

The Budget Policy Statement has a whole series of other measures that we are building on. I just want to talk about that minimum wage increase. We all know that when it comes to low-income people, that extra money gets cycled straight back into the economy. If there is a simple way to support the economy, it is by lifting the incomes of the lowest paid. Why? Because they spend it to support a better life for themselves, and that spending cycles straight back around the economy. It is an excellent measure.

What this Budget Policy Statement shows is that we are supporting our communities, we are supporting our families, and we are working to support the economy that in turn supports all of us, and we are governing for all New Zealand. We are challenged by COVID-19, but this Budget Policy Statement and this coming Budget show that we are doing what matters—leading with a public health response and then leading with an economic response, an economic response that we are prepared for, thanks to our Prime Minister, with her concern for all New Zealanders, and thanks to the excellent work done by our Minister of Finance. He is insightful, courageous, and visionary—a worthy successor to Sir Michael Cullen. I commend this report to the House.

Hon PAUL GOLDSMITH (National): Thank you, Mr Speaker. Speaking on this Budget Policy Statement and the Half Year Economic and Fiscal Update, of course, which includes projections of future growth, and, of course, all those projections are now cast into the air by the impact of coronavirus, I just want to mention one or two issues there. Certainly, it is having a big impact and will have a big impact on the projections in this update. We’re seeing a lot of businesses around this country really finding it tough right now—tourism particularly, the hospitality sectors, forestry, international education, a lot of pressure on universities and that export education sector, which is an important part of the economy. We worry about potential job losses but also people losing hours and losing their income and their smaller businesses.

So we support the Government’s initiatives so far, in terms of the message they sent through IRD and the Ministry of Social Development (MSD) to help in the short term around payments, around provisional tax, and so forth. There’s been some particular work going on in the East Coast. We do note that the Minister of Finance, who will no doubt repeat it soon, is right in the sense that the first conversation that these businesses that are struggling should be having is with the banks, their own banks, in order to make sure that they’ve got the money to get through. However, not everybody will. So we do acknowledge that the Government’s announced that it will be coming up with a business continuity package that will include—they’ve indicated some form of wage subsidy to businesses directly affected, and it absolutely should be targeted to those businesses. Our point on that is that we think the Government should move with more urgency because those businesses have been under pressure now for a number of weeks. We know that it’s complicated, but we just encourage the Government to move swiftly in this area because we worry that the window of opportunity to save jobs is closing and we need to move fast.

We’re also particularly worried about the logic of helping those businesses, but, at the same time, making their job significantly harder by pressing on ahead with the 1 April minimum wage increase, which does make it harder for many businesses to survive in challenging times. Our proposal is that it be postponed—not cancelled, not unwound, not sent off to never-never land, but postponed for six months so that businesses have less headwinds to struggle against at a very difficult time. We don’t want to be making it more difficult for businesses right now.

As well as that short-term work to help businesses most directly affected by the outbreak that we’re dealing with, there is the wider question of whether some broader stimulus is needed across the economy if indeed the impact of coronavirus extends beyond what is short and sharp—which it already has—into a longer, more deeper impact on the New Zealand economy, whether it is indeed leading to a recession, whether it is a trigger to a much wider global slow-down. These things we don’t know yet, but the initial indications now are increasingly disturbing. So there may well come a time soon when wider stimulus is required. We’ll be interested to see what the Government has to say about that and when they will make those decisions, and we think some sort of direct tax relief will be part of that story.

In the meantime, we shouldn’t be losing sight of the more basic issues facing New Zealand. The Minister of Finance will no doubt stand up, like he has many, many times, and say that the New Zealand economy is great and we had strong momentum coming into this crisis—and that is wrong. It is completely wrong. We did not have strong momentum at the end of last year. This economy was growing at a rate of 1.6 percent, according to the Reserve Bank in 2019. Now, those figures may be up slightly or down slightly, but that is not strong momentum. In fact, the strong momentum that we did have as an economy, back in 2017, after nine years of good government by the National Government led by John Key and Bill English over an extended period time—that was strong momentum: over 3 percent growth, huge surpluses being generated, about 10,000 new jobs a month being created for the last two years. That was strong momentum. What we’ve seen in the first two years of this Government is the attenuation of that momentum, the slowing down of that momentum, the slowing down of the economy, the slowing down of job creation, and the disappearance of the Budget surpluses.

The Budget Policy Statement projected, prior to any coronavirus, prior to any droughts, a deficit for this year, and it projected no surplus for the year after that. Again, we hear the Minister of Finance talking about projected surpluses. Yeah, they’re two or three years out, and nobody believes that they would actually occur on the path that the Government was already heading. So that is what it is, and it’s just made it slightly more difficult for New Zealand to respond.

So as well as responding directly to the impact of the virus, we do need to have a clear growth plan and a focus on growth, and that’s what the National Party has delivered and continues to deliver. We’ve talked about the need in five areas: firstly, to reduce regulation, and we talked about that earlier this week—the need to take pressure off businesses so that they have more money to invest and grow and provide jobs for people, provide opportunities for New Zealanders to have good work, good opportunities, to look after themselves and their families and to do the things that they want to do. So we need regulatory reduction. We also need to have help for small businesses, and we’ll be talking about that more.

We often hear about the Prime Minister’s empathy. Well, I don’t feel like the Prime Minister has any empathy for the realities of the 500,000 small-business owners in this country who struggle, who get up early in the morning, work hard, try to employ people, and are confronted with never-ending costs and further regulations and further difficulties imposed upon them, while they’re also just trying to survive in business, which is hard, relentless, and requires great effort every day. Those people are the backbone of the New Zealand economy. We should be supporting them. We should be standing up for them and saying, “They are performing the public service that New Zealand needs.” They are the people that only survive in business if every day they give people what they want, at the right price. It’s a beautiful thing that they’re doing, and they should be supported by this Government, and we should be making their life easier, not harder.

So there’s regulatory relief, there’s a focus on small business, there’s the need to provide tax relief for hard-working New Zealanders when appropriate, and, fourthly, there’s the need for infrastructure and investment. This Government will no doubt, again—we’ll hear the Minister of Finance standing up on his hind legs in the next few minutes; he’ll be saying we will be spending $12 billion on infrastructure. But announcing is not the same as delivering, and that’s the basic lesson that they don’t seem to have learnt yet. When they arrived in Parliament, the first thing they did was they came in and said, “We don’t like National’s infrastructure. We’re going to stop it.” So they turned off all the roads, because they were going to build the light rail down Dominion Road. Two years later, they realised that they hadn’t even figured out what the purpose of the light rail down Dominion Road was, whether it was a—

Fletcher Tabuteau: I raise a point of order, Mr Speaker. Sorry, I was restraining myself, but under the standing rules of this debate, the member must confine himself to the content of the Budget Policy Statement itself—this is not a Budget debate—and not waffle on about unrelated matters.

TEMPORARY SPEAKER (Hon Tim Macindoe): I thank the member for his intervention, but this is a wide-ranging debate related to Budget policy matters, and I don’t believe that the member has strayed from that overarching framework.

Hon PAUL GOLDSMITH: A typical load of nonsense from New Zealand First. They are only sore because they don’t like the light rail project down Dominion Road. They don’t support the light rail project down Dominion Road, which is why it’s not happening. So two years later, they still haven’t got the support of New Zealand First for the slow tram down Dominion Road. We don’t know whether it’s about urban regeneration or a fast track to the airport—nobody believes it will be a fast track to the airport—and so they haven’t done anything. So two years later, having done nothing on infrastructure, they decided to turn the key on and start up National’s roading projects and the fourth railway line and all the things that we were going to do two years ago. So they’ve wasted 2½ years on infrastructure.

The final point is we need to help families. What New Zealanders will be deciding as the election comes up, in six months’ time, is: is there a difference between a party that thinks that announcing things is all you have to do and to have good intentions is all you need, versus a party that understands that it’s delivery that counts? And that’s where we stand.

Now, when we get to the Budget policies outlined in this Budget Policy Statement, what we see is a list of five goals: the just transition, the future of work, Māori and Pacific, child wellbeing, and physical and mental wellbeing—and they’re all very worthy. I’ve got no problem; they’re very worthy things to do. But my suggestion to the Minister of Finance is that they’re out of keeping with the time. The priority right now for New Zealanders is restoring growth and saving jobs, and that should be the overwhelming priority for this Budget: saving jobs and restoring growth in this economy. I don’t see too much about that in the Budget priorities as outlined. It might be somewhere in the future of work, but I’m not sure.

So I’d be very interested to see that, and I’d be very interested to see, after all the talk and all the announcements, when they’re going to deliver 100,000 houses, for example. I’d be very interested to know that, because it is quite true that the Prime Minister, with her intervention at Ihumātao, has stopped more houses being built there than the entire $2 billion KiwiBuild programme has delivered so far. I would love to hear how the Minister of Finance explains that. Thank you, Mr Speaker.

Hon GRANT ROBERTSON (Minister of Finance): I firstly just want to acknowledge the Hon Tim Macindoe for an excellent little spell in the Speaker’s Chair that he’s just had. He was, unfortunately, melding into the sheepskin behind you in a way that made him look a little unusual, but he did a very good job.

SPEAKER: The member knows that he doesn’t bring the Speaker into the debate, although I might say he merges less than he would’ve a few weeks ago.

Hon GRANT ROBERTSON: All right, Mr Speaker. The member opposite, the Hon Paul Goldsmith, started out pretty well in that contribution. He started out by endorsing a number of actions that the Government is taking in response to COVID-19. In particular, I think it’s very important at the outset to note that the first response to COVID-19 has to be a public health response. That is what New Zealanders expect of us. That is what we have prioritised.

He made a comment at the end about not being sure that the priorities in the Budget Policy Statement fitted with where we were at in terms of COVID-19. Well, I would say we’re very proud on this side of the House of the additional investments we have made into our health system. It is our health system, our health workers, who are at the front line of ensuring the wellbeing of New Zealanders during the COVID-19 outbreak, and that is one of the priorities in this Budget Policy Statement. So I think, on behalf of certainly the Government, I want to be able to take an opportunity to thank our front-line health workers, who are currently under quite a high degree of pressure, doing a great job in making sure that not only is New Zealanders’ health and wellbeing being protected but also that information is flowing.

As I say, the member, while he started out well, then ended up in a typical “Negative National” rant—not about the positive things that are happening in our economy, not about the things in the Budget Policy Statement that actually are about lifting productivity, are about making our economy more sustainable, are about making sure that more New Zealanders are included in our economy and benefit from the prosperity in our country, and that is at the core of the Budget Policy Statement. But, obviously, it is clear that we have this debate today in different times than when the Budget Policy Statement was written, in December 2019, and those times mean that we do, at all points, need to assure ourselves that what we’re doing in the Budget is in the best interests of New Zealand at this time. Over the coming weeks, we will be refining the Budget, which is delivered on the basis of this Budget Policy Statement, in line with what has occurred with COVID-19.

But the good news for New Zealanders is that we entered into this period in good shape. Our economic plan was showing benefits right across the economy, and in the face of the global headwinds we’d seen in the last couple of years with the US-China trade war and Brexit, we were coming through particularly well. We have been growing at a faster rate than many of the countries that we typically compare ourselves to, including Australia, Canada, the UK, the eurozone, and Japan. Looking across fiscal and monetary policy across our labour market, across consumer confidence, and even, in the last months of 2019, business confidence, we saw that the economy was on the improve.

The Government’s accounts, for the six months that ended December 2019, were strong. We had a surplus over the first six months of the fiscal year, and we were sitting $500 million higher than we expected. That’s due to a strong economy. That’s due to more revenue coming in as a result of more businesses doing well, making profits, and paying corporate tax, of more people being in work, of more people earning more, and paying their taxes in that regard, and of more people spending because they have confidence to spend in the economy. All of those things were ahead of forecasts at the end of December 2019.

We also had labour market statistics highlighted in the Budget Policy Statement where we now have 4 percent unemployment—historically low levels of unemployment. All of these things are signs that we enter into the face of COVID-19 doing well.

We often compare ourselves to Australia in this regard. Australia’s unemployment rate is actually back up to 5.3 percent. In New Zealand, and the Budget Policy Statement outlines this, we saw record wage growth in terms of the last 10 years in the period covered by year, with around 3.6 percent. We also saw Statistics New Zealand data in the last few days showing us that the total volume of manufacturing sales had its strongest quarterly rise in six years in the final quarter of 2019. We also saw trade data that showed that terms of trade hit a record high in the December quarter.

So all of those things are the reason why we say we are in good shape going into this challenging situation. We particularly say that because we have kept levels of net debt low. We have net core Crown debt now at 19.5 percent—19.5 percent of GDP. That is less than the 22 percent of GDP that we were left with when we came into office. That is what gives us the fiscal space to be able to respond, to be able to make sure that we protect the health and wellbeing of New Zealanders and plan for what may come in terms of the economy.

But the significant announcement made at the time of the Budget Policy Statement was the New Zealand Upgrade Programme. This is the $12 billion boost to New Zealand’s infrastructure. We’re able to do that because debt is low, because the cost of borrowing is low, and because the projects are there to do. This is a fully funded programme. This is not a wish list. It’s not a series of promises. It’s not a media statement put out just before the election. It is a fully funded programme, and it’s a programme that does get the balance right in our transport system. Yes, it supports major roading projects, but it also supports significant investment in our rail sector, in walking and cycling.

It also supports core investment in our education and our health systems. It is those hospitals right now that know that they’ve got a Government that’s got their back and has invested in them as they lead New Zealand’s public health response. That’s what a responsible Government does. It ensures that we invest in our health system. After nine years of neglect of that health system, we have come through with significant boosts, both in terms of what we’re building in hospitals and the support we’re giving, be it through the wages for nurses or be it through the increased investment in our DHBs. So that New Zealand Upgrade Programme, that infrastructure boost, puts us on the right footing as we move forward into this challenging period.

We’ve covered several times in the House in the last couple of days what we’re doing directly in response to COVID-19 of supporting our business community, of getting alongside workers through the Ministry of Social Development, through Inland Revenue, through making sure that the Government departments pay their bills on time. That issue of cash flow was raised directly with us by Kirk Hope of Business New Zealand. He said, “What’s one thing we can do? It’s make sure those bills are paid on time by the Government.” We signed that off within three days to respond to exactly that. We continue to develop the business continuity package alongside the business community.

Most businesses understand that right now we’re in the phase where it’s targeted responses that are needed, tailor-made responses that deal with the industries, the sectors, and the regions who are facing the brunt of this. At the same time, we plan. We plan for the possibility that this may go on longer, that the impacts may cut deeper. We are ready for that and we have the fiscal space to deal with it.

But all of the things that we’re doing for COVID-19, which we must prioritise and we are prioritising, stand alongside a Budget Policy Statement that fundamentally delivers on what the Government came here to do. Yes, we need a strong economy, and we’ve got it. Yes, we need to manage the books carefully, and we are, but we must deliver to our people and to our environment. That is why the Budget priorities that are in here are the ones that we must stick through, no matter what is happening.

Yes, we have to grow jobs. Yes, we have to make sure that we’re investing in our small businesses. All of that’s being done, but we must continue to deliver and prepare, make sure that the economy is able to get ahead in terms of climate change, make the most of the opportunities that exist there, address the future of work, support Māori and Pasifika aspiration, make sure we lift children out of poverty. We’ve seen the statistics that are proving that we’re doing that, and investing in our physical and our mental wellbeing.

I am extremely proud that we are now getting the focus right. Yesterday in the House, James Shaw, in his tribute to Jeanette Fitzsimons, raised the question of her views around how we needed to move beyond GDP. We are doing that. Yes, it’s important to grow our economy, but it is also important that we care about who shares in the success of that economy, that we measure our success in the wellbeing of our children, the health of our environment, our mental health, and our success in terms of work. All of those indicators are now clearly laid out in a Budget Policy Statement that gives a feeling of confidence to New Zealanders that we are on the right track, that we have the plans in place to make sure that they and their families feel safe and secure. We are in challenging times, but we are in very good shape to handle them.

Hon JUDITH COLLINS (National—Papakura): Thank you, Mr Speaker. Can I start by thanking all those people who have sent nice, kind words of support for Holly Collins, my dog, who is almost 17. Obviously, you know, dogs can get coronavirus, so I tell you, if I get a sniff, I’m not coming to work.

So I think it’s really important, though, that we look at this Budget Policy Statement and say, “Is this a Budget Policy Statement fit for present times and into the immediate future?” I’m sorry to say it: no, it’s not. So we have a Government that has talked about—and the Minister who has just resumed his seat just talked about—the Wellbeing Budget, and the business as usual, basically everything continuing the same, and looking to the future and climate change, everything else.

We can put our heads in the sand over this COVID-19 or we could understand that it is coming our way. When we see the panic that has occurred in supermarkets where people are buying toilet paper in New Zealand in great trolley loads—which is totally insane behaviour, frankly, given that we export toilet paper. I’ve just checked on the internet, and apparently in 2018 we, as a country, exported $54 million worth of toilet paper. So I’m pretty certain we’re covered no matter what, when it comes to the toilet paper.

But let’s not joke too much about it. That is a sign of people panicking. The reason they’re panicking is they’re not certain what to do, and so they race round and they think, “What might I need if everything’s shut and I can’t go out, or I’m stuck in isolation or something?” That’s what they’re doing.

Last night, or yesterday, rather, I should say, 168 people died in Italy of COVID-19. Now, the wave of death seems to have occurred in China over the last month, and now seems to be trailing off. That is a good thing that it is trailing off, but the wave now seems to be in Italy. Italy has 60 million people; we have 5 million people. That would be like us standing up in this House and saying that yesterday we lost 34 people to COVID-19.

I understand why people feel a bit panicked. If it was us with those numbers, we probably would, too. We don’t need to panic buy food. We export 95 percent of the food produced in New Zealand. We produce enough for 40 million people. My message to people is we don’t need to panic. But the big thing that we do need to have from the Government response is that we need to know that the Government knows what it’s doing and it is properly prepared.

We were not overly, as people, convinced that the Government knew how to deal with a pandemic when it couldn’t cope very well with the measles epidemic. We didn’t believe that that was something that should be happening in today’s world when we have immunisations available. There is no immunisation yet available for COVID-19, and I think that is one of the things that is causing businesses and staff to be very concerned about this and how this could impact on them, their jobs, and therefore on the economy.

In the National Party, we believe that the Government needs to reassess the Budget based on the fact that COVID-19 is impacting on New Zealand, not so much in numbers at the moment—and it most likely it will—but in the way that it’s affecting our exports. If we consider that tourism is a major export to New Zealand—such as people come to New Zealand for tourism—that is clearly having a serious impact right now on our tourism industry, which is one of our biggest industries. It has made a huge negative impact on our tertiary education providers, and, particularly, not only on our universities and the polytechnics but also on the private tertiary education providers.

We should not underestimate the impact of this terrible, terrible infection on not only people’s health, but, actually, on their mind-set. I’ve been looking for some words of inspiration, and I didn’t get them from Mr Robertson, but I did get some from Franklin Delano Roosevelt who, in 1932, during the Great Depression, when he took over as the President of the United States, said the “only thing we have to fear is fear itself.” It’s a bit trite, I guess, to say that, but I think part of what’s driving this panic is people are fearful, and they’re fearful if they see their Government not looking like they’re in charge and doing the best they can.

It is important that if people believe that they have some of the symptoms of COVID-19—which I have to say, look to me, when I’ve heard about them, remarkably similar to most other winter viruses that we often get—they should be able to get tested. We have people now self-isolating in what we’d consider a responsible way. The problem is they’re not at work either. And so workplaces and businesses are having to think of ways of dealing with it. People are putting in place, very responsibly, plans—and I understand that Vodafone were doing this today, or very soon—where people can work from home, so that they are not putting both the work and themselves at risk and their workmates. So these are good, responsible responses from people.

I don’t think it’s responsible, though, for the Minister of Finance to stand up and say, “We’re just going to continue on with everything that we were doing in exactly the same way.” I don’t think anyone needs to be a rocket scientist to work out that the world is in a situation of quite a lot of flux. People are very worried and certain countries are taking drastic measures, primarily because they have to. We now have countries like Samoa—one of our neighbours and very good friends—saying, “If anyone wants to come to Samoa, they need to have a doctor’s certificate to say that they’re not sick.” I mean, this is going to have a huge impact on Samoa’s tourism, which is one of its biggest earners. But then again, they need to do something because they don’t have a lot of confidence that other countries are doing what they should do to keep this virus at bay.

We also need to bear in mind that not everyone who gets this virus is going to die, but many are going to be very sick and some may not be very sick at all. But when we look at those mortality rates, they’re not enormous: about 3.4 percent of confirmed cases so far. But if you’re one of those 3.4 percent, you might think that’s a pretty enormous number.

But what I’m concerned about is listening to Mr Robertson talk about how everything’s just going along fine and dandy. Well, they’re saying it’s all fine and dandy as a tsunami’s coming at you. We’ve got an enormous tsunami coming at us, and that is our export markets—and thank goodness for the farmers, by the way. If we weren’t producing all this food—thankfully, people still have to eat, but they’re not necessarily going to be eating quite the same quantity or quite the same as what we have, because we’re exporting fine product. But if we didn’t have the farmers—if the Government had actually succeeded in undermining farmers so much they stopped bothering to produce—we would be in very, very dire straits. Thank goodness. Think about Air New Zealand, for instance, and what they’re going through at the moment: cutting flights—they and many other airlines. This is not business as usual. About half of Air New Zealand’s owned by the Government. We’re going to have a massive loss coming up there. We’ve got losses all over coming at us as a country.

I just think it’s important that we don’t panic, that we don’t race around buying up all the toilet paper produced at Kawerau and thinking we’re the only people there. I think it’s important that, when we look at our Australian cousins and that terrible video that I think we’ve all seen of those Australian women fighting over toilet paper—do you know my thoughts were? “Oh gosh, I hope they’re not New Zealanders and they get sent back here.” We’ve got enough trouble without that nonsense. But it’s just a sign of panic, and people do, and they don’t trust that the Government’s in charge; that’s one of the problems.

So I think that the Government needs to not be so low key about it that nobody thinks they’re doing anything, but telling people straight up what’s happening: how many cases there are, what’s happening here, what’s being done. I think, hopefully, an immunisation regime will be put in place—a vaccine will be put in place or found—before it comes to New Zealand in a major way—this COVID-19—but let’s be real here: this is going to seriously affect the economy, seriously affect jobs, seriously put at risk people’s work, seriously put at risk people’s wellbeing. This country doesn’t need a Wellbeing Budget, it needs a Budget about keeping our people well, and that’s something we’re not seeing from this Government.

FLETCHER TABUTEAU (Deputy Leader—NZ First): That was one of the most contrite contributions that this House has seen in a long, long time. The previous contributor, Judith Collins, stood up and spoke to this House about lacking consistency and she spoke about business as usual. And then she talked about applauding the measures of other countries in their efforts to shut down borders, whilst at the same time lamenting the fact that we’re having to slow down the number of international students coming into New Zealand at the moment. The consistency of the argument is lacking.

The member started giving us doomsday scenarios and talking about the end of the world, almost, and then she said, “But let’s not panic.” It’s just frustrating to listen to the members opposite politicise what is an incredibly important situation that this Government and the people of New Zealand—the people themselves and the businesses of New Zealand—need to work through together. I hope that as I stand in this House, I can give some reassurance to those businesses especially, but the people of New Zealand who have been told and updated and communicated to about what the situation is with COVID-19.

But firstly, I would like to address, actually, the Budget Policy Statement, which the Finance and Expenditure Committee addressed. It is an opportunity, despite my reaction to the contributions opposite, to acknowledge the committee and the work that we do—I being the deputy chair—together with regard to the finance and expenditure of this fine country of ours. So we heard and we wrote the report, obviously, which we’re debating now on, firstly, the Budget and the focus. And the member opposite spoke about not needing a Wellbeing Budget, and then finished, again, in a confusing way, saying, “We need to focus on the wellbeing of people.” That’s what this Budget does. That is what the policy statement has outlined, again, for this House and for the people of New Zealand to read, understand, and debate.

This is a Budget that, like the one before it, has said that GDP cannot be the sole measure of success. I think even the members opposite surely will acknowledge that the irony of GDP itself is that it is both too broad and too narrow a measure for us to use to measure the success of an economy. As I have said many times in this House, Kuznets, the economist who designed and created GDP, said himself, at the creation of this tool, don’t use it as a tool to measure the success of a nation’s economy. It is a useful number and it is a useful insight, but it is not a measure.

So we have said that we must work at understanding what else is it that we measure, because I’m not sure if the public at home will understand or realise that, for example, the rebuild of Christchurch, which was a necessary and important part of this country’s history, was actually good for GDP. It was a measure and a positive on the outcome, but that took mass destruction. So how do we underlie and analyse what is it that is good? What is wellbeing for New Zealanders?

Also within this work that we have undertaken in the Wellbeing Budget 2020, we are looking at “Just Transition—Supporting New Zealand in the transition to a climate-resilient, sustainable, and low-emission economy”. New Zealand First has always said—and we’ve worked with the farmers closely and come up with a good solution, despite the members opposite—that a good proposition for New Zealand exporters is to stand up in our world market and put the provenance to our buyers around the world and to have that story to tell about happy employees working and earning a good living in their job and about an economy that understands their world commitment to carbon emissions, so that our buyers around the world can take satisfaction and take pride and actually pay a premium for New Zealand products because they understand, actually, the contribution that New Zealand is making in terms of fighting against carbon emissions.

The second part is the “Future of Work—Enabling all New Zealanders to benefit from new technologies and lift productivity through innovation”. Again, New Zealand First, in particular, is proud of the efforts we made around the research and development legislation that we brought into the House in an incredibly important attempt, effort, and ongoing work where we have seen an increase in the investment and the incentivisation of investment into research and innovation by businesses in New Zealand. That, fundamentally, means more money in the economy but, long term, it means greater productivity.

The third tranche to this was “Māori and Pacific”, and as the Parliamentary Under-Secretary for the Provincial Growth Fund, or regional economic development, it has been a particular pleasure to work with Minister Jackson in our combined efforts to target work programmes in our regions where our Māori youth and Pacific youth but also our Pākehā youth can be supported—

David Seymour: Tell us about economics.

FLETCHER TABUTEAU: —into work where otherwise they were ignored. I would go on about the nine long years of neglect, but the others on the other side of the House just couldn’t bear to hear more about the truth there.

The fourth part was about “Child wellbeing—Reducing child poverty and improving child wellbeing”, and so the investment there from this Government has been unparalleled in modern times and it is already making a difference. I’m already running out of time.

The last part of that was “Physical and Mental Wellbeing”, and, actually, what I wanted to touch on there in another part of my speech, but I’m running out of time, was the investment that this Government has made into health. I think the Minister of Finance touched on it in his contribution when he spoke about a health sector that this Government has invested in to the tune of billions of dollars, which means our front-line staff and the facilities that they need are actually, finally, coming into a place where they’re up to the task of making sure that if COVID-19 becomes the health problem that we are seeing around the rest of the world, we are prepared. Our front-line staff and the facilities that they use are ready to go, and that is fundamental to making sure that New Zealanders and their wellbeing are looked after.

What I wanted to say in conclusion is to talk about what New Zealanders can expect from a Government in terms of an emergency situation like COVID-19 at the moment, and what I want to say and to talk about is the position that this country has come into as reported in the policy statement. We are at 4 percent unemployment and our wage growth is at 3.5 percent, while inflation costs are less than 2 percent, which, fundamentally, means more people are employed in the New Zealand economy and they have more disposable income to spend in the economy and to look after themselves and their family. That becomes a virtuous cycle as we move forward in making sure that the scare tactics from the Opposition don’t work—don’t panic people—and we move forward and give the confidence to New Zealanders that they can make sure that if they are looking after their health, we are looking after the economy and business, and doing all we can to make sure that we move forward productively and healthily. Thank you, Madam Speaker.

Hon MICHAEL WOODHOUSE (National): Well, thank goodness that’s over. That’s 10 minutes of my life I will never ever get back. That was a terrible wander through the broad subject, and I do hope that we get a better quality of debate and speech from the members on the other side than that.

What a difference three months makes, because when this Budget Policy Statement was written and analysed by the Finance and Expenditure Committee, things were very, very different. About the only thing that’s the same now is the fact that we’ve got the same Minister of Finance, although he’s got the wrong photo. He’s grinning from ear to ear about this document. He’s not smiling now. He’s not smiling now because things have materially changed, even in the three months since this statement was written.

Actually, there wasn’t a lot of good news, despite the gilding of the lily by the Minister in this statement, because things were already going sour on the Government’s watch. GDP growth was going down. Job creation was going down. Bear in mind that this Government inherited an economy that was creating 10,000 jobs per month, and, by sleight of hand, they managed to reduce that by 60 percent. Not in a recession and not in tough economic times, like the previous National Government had to deal with, but, actually, the very best of times, when commodity prices were high and growing, when inflation was low, and when the conditions for growth and supporting the very families that they describe their Budgets as about—being wellbeing—and they’ve managed to reverse that trend.

I, frankly, think one of the biggest mistakes the previous Government did was it didn’t put a big, flashy neon light sign on its Budget, because it knew that every single Budget was about wellbeing—every single one. Every investment that we make into the people of New Zealand is to improve their wellbeing. Well, words are fine; actions are what really counts when it comes to Budgets and Budget policy, and the fact is we are now looking at a very, very different picture. We started from a low base, a much lower base than our economy should have been at, and we’re going backwards. Some of those things are matters that the Government does not control—and I’m going to talk about COVID-19 and the impact on both the economic update and the Budget which is being prepared—but some of them are.

The imposition of significant costs on business and on families and on job growth is going to have a material negative effect and undermine—and, actually, we can throw this update out. In fact, I do feel—I almost feel—a bit sorry for the Minister of Finance in trying to come up with the mathematical alchemy that he will need to put together a Budget in May that he can still call “about wellbeing”. This will be about not wellbeing but about being well, because the COVID-19 outbreak has the potential to significantly undermine our country’s wellbeing in the short term.

It already has done economically, and the degree to which the economic pain lasts will be a function of the Government’s management of the health effects of the coronavirus outbreak, and I have to say, as shadow Minister of Health, that my assessment of the Government’s performance so far has been that it has been slow and lacking in energy. I want to compare what the Government has or has not done with the responses of countries with whom we and our friends compare ourselves. Even as recently as today, our neighbours across the Tasman have committed a billion dollars.

DEPUTY SPEAKER: Come back to the bill.

Hon MICHAEL WOODHOUSE: I’m sure they appropriated it, Madam Speaker, and it has a very significant effect—

DEPUTY SPEAKER: It needs to relate to this.

Hon MICHAEL WOODHOUSE: Well, it does because it is very much—

DEPUTY SPEAKER: You need to do that.

Hon MICHAEL WOODHOUSE: Well, it’s a broad-ranging debate, I would suggest.

DEPUTY SPEAKER: It’s not that broad.

Hon MICHAEL WOODHOUSE: Well, it’s broad enough.

DEPUTY SPEAKER: It is on the Budget Policy Statement. So relate it to that.

Hon MICHAEL WOODHOUSE: Right—I certainly shall. Things are bad and they’re going to get worse. That is the simple measure.

Anahila Kanongata’a-Suisuiki: Pessimist.

Hon MICHAEL WOODHOUSE: The member says I’m being a pessimist, and I think that was the accusation that was put by Fletcher Tabuteau to the previous speaker. I think there is a big difference between rhetoric and hyperbole and the reality of what’s going on. Call me a number of things, but you would never call me an optimist when it comes to the situation that we face and the conditions within which Budget 2020 is going to be written. All of the slogans and all of the fancy hyperbole that comes out of the Government is not going to deliver the improvements that this country needs and the strategies to keep New Zealanders well through a significant economic and health crisis.

In particular, the very immediate effects of that on the Budget Policy Statement has been on our balance sheet, because our ACC investments, our superannuation fund, the New Zealand Superannuation Fund, New Zealand fund investment vehicles are all taking significant hits to the point where the projections of income from those investments are going to be materially downgraded. That’s the stuff that, potentially, the Government doesn’t control.

What it does control is spending, and what Treasury also said in its economic update was that the financial risks to our DHBs in not meeting their eye-wateringly high projected deficits for 2019-20 are very real. Indeed, that’s been borne out by the fact that in the five months to date, the combined DHB deficits are now 24 percent higher than they were this time last year. So we could throw those projections out. Treasury were right that that fiscal risk is being realised and the Government is going to need to find, probably, I would predict—because they didn’t fund last year’s deficits—somewhere in the region of between $500 million and $600 million just to stand still. None of that is included in the numbers that underpin these two reports.

And that’s before we get to the effects of COVID-19, and what we’re hearing from the health sector is that that investment is not being made. We see our friends in Australia, in the United States, appropriating over US$8 billion over the weekend, taking dramatic steps to reduce the financial impact of that and appropriate it through their Budgets. We’ve done nothing.

We’ve got doctors telling the media that the DHBs are asking them to fund their own personal protective equipment (PPE), to keep those patients out of the very hospitals that the DHBs run. That is outrageous. It is penny-pinchy, and it is not the actions of a Government that portrays its budgeting as being about wellbeing. And we’re only at the start of the slide. I know that if we don’t get a sustained community outbreak, it will be because we got lucky. But if we do, it will be because we did not take energetic, proactive, nimble steps to prevent the virus being spread.

The Minister of Health in question time talked about how great the close-contact precautions to keep people safe from that virus were, and yet being in a mosh pit at a concert with lots of sweaty people around them, within a metre, doesn’t meet his definition of close contact. For that reason, the risks of a sustained community outbreak and the significant healthcare, social and fiscal costs to this country are significant, and none of that’s mentioned here. None of that is mentioned here.

Never mind what kind of response they’re going to give, not a single dollar of extra money has gone into prevention or control or recovery. We’ve got our fingers crossed on the Treasury benches, and that’s not good enough. This Budget Policy Statement is a relic. It is out of date three months after it was written. The conditions on which it was built, poor though they were, have changed for the materially worse. That worries me. I think the Government needs to be much more realistic. People like Tamati Coffey and Fletcher Tabuteau can actually be a little more measured and a little less of a cheerleader for a Government that’s failing to deliver for New Zealanders—because talk’s cheap; actions matter.

National delivers. It delivered through two earthquakes. It delivered through a global financial crisis, and it will deliver again, and the country will not need to wait. It will deliver from day one, and that day is about 197 days away.

Hon JAMES SHAW (Minister for Climate Change): Thank you, Madam Speaker. Just before I turn to the substance of the debate, I just want to take this moment to acknowledge the passing of Sir Rob Fenwick, who died, after a five-year dance with cancer, in the last 24 hours. I know that the House will want to mark Sir Rob’s passing in an appropriate way, but given the proximity of the event, I thought I would just take this moment. He was one of the greatest environmentalists our country’s ever seen. He was one of the most extraordinarily kind and generous, thoughtful and committed human beings that I’ve ever had the pleasure of knowing. I think his loss will be felt greatly, not just by his friends and family, for whom we give our condolences, but also by the whole country.

I want to pick up, in the spirit of this being an actual debate, on some of the comments of the previous speaker, Michael Woodhouse. One of the things that he said in his address is that there are things that are beyond the Government’s control, such as the arrival of the COVID-19 virus and the impact that that has, but there are also things that the Government can control. And one of the things that he said that the Government can control is spending. He is, of course, completely correct. Governments can use spending to keep the economy buoyant, to keep cash flowing through the economy, and, in fact, that is exactly what we are doing. So I’ve got good news for Michael Woodhouse in that regard.

There has been a multi-decade under-investment, particularly in infrastructure, particularly in social infrastructure and natural infrastructure in New Zealand, and this Budget Policy Statement directly refers to what our intentions are, what to do about that. Figure 2 on page 6 talks about net capital spending and actually shows the amount of money that this Government is planning to invest in the economy, not just to keep money going but also to make up for some of that extraordinary deficit in our water, in our transport, in our regions, in our cities, and in our natural capital.

I would actually have to say that when he talked about the job that National did in analogous circumstances—not similar, but analogous circumstances—through the global financial crisis and the Christchurch earthquakes: yes, they went from a position of no net debt as a percentage of GDP, and obviously leveraged up to deal with those and continued to spend, but, actually, being fiscally conservative probably had a dampening effect on the economy and kept those constraints on longer than was necessary. One of the impacts of that is that whilst central government might have kept its levels of debt low, actually, if you look at household debt, which shows up on page 9 of the Budget Policy Statement, what you will see is that that rose over the period of National being in Government. The reason for that is because there was not sufficient social spending going on in the economy over that period of time. So what has happened is that, because National doesn’t believe in paying people minimum wages and because they think that the costs should be borne by low-income families rather than by all of us equally, actually what that has done is driven households into debt. We see some of the consequences of that, and it’s going to take quite some time for us to unwind.

Mr Woodhouse says that every Budget is about wellbeing, and to some extent that is true. The reason why this Government’s wellbeing approach is different from previous Governments—not just the previous National Government but all previous Governments—is that by the “wellbeing approach” we’re referring to a very specific way of putting Budgets together. Many of the features are exactly the same as they have been for many years: Ministers and agencies put in bids, and so on, and those things have to have a benefit-cost analysis attached to them. But in the wellbeing approach that’s being used by this Government, and it gets extended through this Budget Policy Statement, actually what’s happening is that, in addition to those normal benefit-cost ratios, there are additional pieces of analysis where those bids have to demonstrate how they contribute to the stock of human capital or natural capital or both in Aotearoa New Zealand. So it’s actually a higher hurdle for Budget bids to have to go through; it’s actually a more scientifically led approach than Governments in New Zealand, of any hue, have done in the past. It is an added discipline to the Budget process.

Now, I’m not going to pretend that it’s perfect; we’ve only been at it for a few years. Every iteration over the course of the last three years has gotten more sophisticated and we’ve learnt from some of the, you know, holes and the patches from the year before. But it is a very significant development, and it’s one that I’m very pleased that we’re continuing, and to see it reflected through this Budget Policy Statement.

I just want to refer, also, to some of the things that are actually outlined in this Budget Policy Statement. Again, to, sort of, Michael Woodhouse’s point, the things that he seems to think that we shouldn’t be spending money on include major investments in rebuilding the health sector, major investments in core Crown education expenditure, addressing child poverty, lifting outcomes for Māori and Pacific peoples and communities that are traditionally excluded in our political economy, enhancing the Māori-Crown relationship as we move into a post-settlement world, strengthening the aspirations of Pacific peoples, strengthening our response to climate change, dealing with a 30-year infrastructure deficit. I mean, the idea that, actually, these things are somehow optional and that we shouldn’t do them is, to me, ridiculous. I’m very proud of this Government for investing in these things. Actually, when you have an economic downturn, when you have a risk presented such as with COVID-19 and you are looking at a period which is going to be tough for the economy to handle, these are exactly the things that we should continue to invest in—and I would argue actually invest more in—because it gets money flowing into the economy.

The one thing that Michael Woodhouse was correct on is that the thing that the Government can control is expenditure, and, actually, in continuing to invest in infrastructure and health and education, in the environment and in our people, not only are we building up the resilience of our people to be able to respond to crises like the COVID-19 challenge that’s in front of us; we’re also continuing to stimulate the economy. If you decide that you don’t want to do those things, you actually pull that money out of the economy at exactly the same time as businesses are facing a downturn. That’s when you really run into trouble; you actually make a downturn worse and you run the risk of tipping the country into a recession.

So I would say that, actually, this Budget Policy Statement is relevant. I know that, obviously, there is, you know, new information—shall we say?—that’s popped up since it was published and since it was written. But the fundamentals of this Budget are solid; they are important when times are good, they are also important in times of challenge like the ones that we have in front of us. So I think that this is a good start for the Budget process. I commend this and I commend the work of the committee to the House.

Rt Hon DAVID CARTER (National): It’s a pleasure to have a contribution in the Budget Policy Statement debate and particularly a pleasure to follow on from the Hon James Shaw, who correctly pointed out that the only thing the Government can do in this situation is control expenditure. So I suggest that the Hon James Shaw has a very quick word with his parliamentary colleague—in fact, his Cabinet colleague—the Hon Shane Jones, and starts controlling expenditure, because the revelation yesterday and again in the House today of over $1 million wasted by officials, going around the country, trying to solicit bids for the Provincial Growth Fund, trying to solicit bids for the slush fund developed by New Zealand First—absolute waste of money.

Darroch Ball: What did you guys do for the regions?

Rt Hon DAVID CARTER: Well, Darroch Ball will have his chance for a valedictory speech very shortly; he doesn’t need to start now. It’s not far away, Mr Ball. But I suggest that if the Hon James Shaw wants to do anything to help the situation that the Government finds itself in, start talking to his own Cabinet colleagues and start to control some of the expenditure that is clearly being wasted.

I do acknowledge that of the many Budget Policy Statement debates I’ve been involved in, none has been quite like this one when we’ve had such a short time lag between the publication of the Budget Policy Statement and such significant changes in the economic outlook, to the extent that the document we’re discussing today is completely outdated. Of course, it was signed off by the Minister the Hon Grant Robertson with a huge photograph and a smile on his face on 11 December 2019, and here we are less than three months on; the situation has changed dramatically.

We at the Finance and Expenditure Committee had the opportunity to talk to both the Secretary to the Treasury, the Governor of the Reserve Bank, and the Minister himself before we prepared the report. I note that Tamati Coffey’s in the House; he will have remembered my contribution and my question as we deliberated on this report. If he looks at page 5, there’s a bold heading there: “The outlook for the economy remains positive”. I took issue with this; I said, “I don’t think we’re being realistic in saying the outlook to the economy remains positive.”

We heard—in fact, we quote—the rate of economic growth is projected to rise in 2020 and beyond—the outlook for GDP growth to increase from 2.2 percent in 2019 to over 2.8 percent in 2021. I said to the committee at the time, “That headline is misleading.” But I think it might have been the chair herself who wanted me to then look at the next headline, which was—and I quote—“But the full impact of COVID-19 outbreak on the economy is unknown”. And with that I totally agree because I remember the questions we raised of the Secretary to the Treasury and of Adrian Orr, the Governor of the Reserve Bank. We were asking them: what about the effect of COVID-19? This is now three weeks after the outbreak had reached prominence in China, so it was early in the current worldwide development of COVID-19. Neither Mrs McLeish or Mr Orr had a clue as to how COVID-19 would affect the New Zealand economy.

I don’t say that as a criticism of those two officers. The world was in uncharted territory. We had a pandemic developing at that stage in Mainland China, the risk of outbreaks to other countries, and as we’ve all seen—in the months since we signed the report off before the Finance and Expenditure Committee—this pandemic has moved from Mainland China. In fact, Mainland China, I would suggest, has basically got it under control but you’ve got countries like Iran, you’ve got countries like Italy, you’ve got potential developments in the United States of America and the United Kingdom. You’ve certainly got cases in our own nearest major trading partner, of course, Australia, and we’ve got positive cases here in New Zealand.

So I say to the Government: the impression you are giving New Zealand voters is that as a Government, you’re scrambling to respond to the COVID-19 outbreak. In the Budget Policy Statement, we would hope we’d have some surety from people like Adrian Orr, but we didn’t get it. And I’ll give you an example of why I say this amateurish Government is struggling to respond. And we saw it today in the House with questions to the Minister for Social Development around the response of Social Development to the potential for people to be laid off from jobs and then their eligibility for the jobseeker benefit—the dole, which she won’t allow to be called the dole, but most people know it as the dole. The Minister informed the House, as had been actually made public probably a week ago, that they’d adjusted the stand-down period. Positive move—a good move. But what I was alarmed to hear today in the House in question time is that doesn’t become effective until 23 March—

Andrew Bayly: What?

Rt Hon DAVID CARTER: 23 March was what the Minister said in the House today. So there’s an opportunity for the Minister for Social Development to actually respond positively to the outbreak of COVID-19, both in New Zealand and the effect it will have on the economy, and again, either through laziness or through incompetence she hasn’t made an immediate announcement to fix the stand-down period. She hasn’t even asked her own ministry to update reports about what potential rise in numbers to the jobseeker benefit there could be because of COVID-19. And it’s that sort of response that you’re getting from this Labour Jacinda Ardern - led Government that New Zealanders have not got confidence in.

I say to the members on the other side of the House, the Government members, if you want to see an example of a crisis that hits quickly, go back to the earthquake situation in my city of Christchurch. The earthquakes occurred, from memory, on a Saturday, a Cabinet meeting on a Monday, and a wage subsidy announced at the end of that Cabinet meeting. There wasn’t time to put parameters around it. People were suddenly without regular wages. The Government needed to do something and it did something and it did something almost immediately. And then we had the Kaikōura earthquakes. Same response from the John Key - led Government.

So the Government needs to look at some of these examples because they’re relatively recent. The situation we have now is at least as critical to the New Zealand economy and it’s time for a response. And if you think back to what happened last Monday after Cabinet, the Prime Minister and the Minister of Finance called a press conference to announce a package of support for business. And you know the essence of the announcement: we will call another press conference next Monday and then we’ll give you details. Another week lost as businesses can’t afford to hang around while the Government flounders and struggles to find a response.

So I say to the Ministers sitting on the other side, I say to aspiring Ministers sitting on the other side—well, they haven’t got much hope because we’re nearly at election time. But I say to them “Don’t be too proud to have a look at the way the John Key Government handled a crisis.” because that’s what New Zealanders want to see. They want to see a response. They don’t want a press conference called, with all the palaver of the press conference being called, to be told, “Wait another week for this announcement.” I say to Grant Robertson that time is running out, because I know of businesses that are struggling.

I want to address my final minute to the fallacy that Grant Robertson continues to run—and he did it in his contribution to the House this afternoon in this debate—that the New Zealand economy is in good shape and it’s resilient enough to withstand this crisis. The New Zealand economy was in good shape before the country elected a Labour - New Zealand First - Greens Government. But the opportunities given by that strong economy, which this Government inherited, have been completely squandered with the likes of the wasteful expenditure we heard about in the House today from the Hon Shane Jones and his provincial slush fund. The economy was not resilient. It is not in good shape. That’s why there’s an urgency for this Government to bring a package together as quickly as possible, and if it doesn’t happen by next Monday, then it will be too late. New Zealand businesses are struggling. People will be unemployed shortly unless this Government responds.

DEPUTY SPEAKER: This is a split call.

TAMATI COFFEY (Labour—Waiariki): We’ll only have to put up with a few more contributions in this House from that member, the Rt Hon David Carter, and rightfully so, because he’s putting—so what we’ve seen a lot of in this House is we’ve seen a lot of scaremongering and actually we need to call it out because what it’s doing and the effect that it’s having on the people out there in New Zealand is not good. It’s making them panic buy, it’s making them panic—full stop—and we need to turn that around and we need to inform people with fact. And fact is really good. And here’s a fact for you: actually, the Budget Policy Statement said that the economic outlook is good. So I agree with my fellow Finance and Expenditure Committee member over there. It is good. They don’t want to believe it on that side of the House, though, because they just couldn’t fathom the thought that a Labour and New Zealand First and Greens Government just could have a handle on the economy. They just can’t believe it.

But let’s chuck some facts in there, because actually that was what was in the conversations that we had with the Reserve Bank and on our committee. Unemployment is down to 4.2. Māori unemployment is the lowest that it’s been in a decade. Annual wage growth is incredibly high. The minimum wage is going up. And at a time when, obviously, we are facing this crisis, you can do two things. You can either continue to invest in the people who are on the lowest wages in the country or you can pull back on that. And the Opposition ideologically would say that it’s time to pull back on it, but over on this side of the House we think that when New Zealanders have got more money in their pocket they head back out into the economy, into their local economy, and they spend that money around. So now is not a time to be frugal, as they would have you believe.

They would like to paint a picture of us being the all-spending Government. But actually, what we’re doing is we’re investing in this country like it’s never been invested in before. The Government’s priorities for the Wellbeing Budget 2020 are about “Just Transition—supporting New Zealanders in the transition to a climate-resilient, sustainable, and low-emissions economy”. That’s a great thing. There are people out there in New Zealand who would hear that and go, “What a noble priority that is. Push that up.” So that’s one.

“Future of work—enabling all New Zealanders to benefit from new technologies and lift productivity through innovation”. Again, a great priority that’s really hard to argue with. And here’s another one, and I’ll probably call these ones out together: “Māori and Pacific”—to have that as a priority in terms of “lifting Māori and Pacific incomes, skills, and opportunities” is just something that I find incredibly hard to negate and that’s what the Opposition will try to do. They’ll try to tell you that actually it’s not worth it. But actually we’re here saying that that is one of our priorities and that’s what we’re investing in. There is “Child wellbeing—reducing child poverty and improving child wellbeing” in our communities—and, of course, physical and mental wellbeing.

When we came into Government, we knew that we had a mental health crisis, because our people were telling us. They were telling us that they wanted change and they wanted our Government to deal with that. So, again, we have had unprecedented investment into mental health, and that’s something that I’m incredibly proud to be a part of this Government for. And it’s something that, actually, I tip my hat to the leadership of our Prime Minister, Jacinda Ardern, who has done a brilliant job of leading us despite the shocks that we’ve had as a country just in the short couple of years that we’ve been in Government.

As we sat on that committee, first of all I want to thank all of the submitters that came before our committee and put forward their different points of view. Of course, there was, as you would imagine, a spectrum of views, but I have got to say a common thread there that was coming through again and again in these submissions was that they felt that the Government was on the right track. They felt that we were the ones that were tackling the long-term problems, and they felt that we were the ones that had our priorities in order. Those Budget 2020 priorities are listed there. They engaged with them on behalf of their organisations that they represented.

One thing that has been talked about is the impact of COVID-19. The member opposite was right: this wasn’t a thing—we didn’t even know about it—when the Budget Policy Statement came out, but actually we took the opportunity in the committee to talk about it, and the reason that we’re going to be able to tackle it head on is because the economy is doing really well. We have gone and prepared ourselves the best we can for this, and yes, it is an evolving situation, and yes, we haven’t got all the answers, but yes, we’re going to make sure that New Zealanders are looked after in this process, during this outbreak, to make sure that they’re informed with facts and make sure that they’re looked after now and into the future.

TODD MULLER (National—Bay of Plenty): Thank you, Madam Speaker. I rise to take a short call on the Budget Policy Statement (BPS). Can I, first, begin by just critiquing Tamati Coffey’s observations. Firstly, he raises the issue around the levels of panic in this country. He’s right: they’re rising. But he’s wrong about the cause. The cause isn’t New Zealanders reaching that view because they feel that they’ve just naturally fallen into that state. They look at the capability that sits on the Treasury benches and they know that, fundamentally, they don’t have the ability to manage through it. They’ve got no trade experience. They’ve got no commercial experience. They have never in their own lives, in their lived experience, been exposed to something as complex and whole of country and economy of this scale—and, bluntly, they’re bereft of ideas as to how to do it. So they end up returning to process and platitudes. Last week, we were told that we were going to have an announcement, and a week later that it was coming in a week’s time. They’re out of their depth, and it’s their actions every day which is reinforcing the sense of unease in this country, and the sooner they realise that and actually grip it, the better.

What I would like to talk about—as has already been covered by a lot of speakers—is that the deterioration of the New Zealand economy in the few months since this statement was put on the Table is severe and acute. What I find quite remarkable is that, as the Government is flailing around looking for ways of protecting and buttressing the economy from the shocks that it is living in and is likely to live in over the next few months, they are turning to the very sector that they have spent the last two years trying to unwind, constrain, and whack, which is the agricultural sector of this country. As they see economic confidence eroding beneath their feet, as they see unemployment starting to rise, GDP growth stalling and going into likely recession, the one sector that could be the difference between a deep, deep recession and something which is bearable in this country will be the strength of our food exports to the world. How quickly has their tune changed, confronted with the reality that, actually, 70 percent of our country’s exports come from food and fibre, and actually they are sectors that deserve to be worked with, not condemned—celebrated and not looked to be constrained.

You have heard it in some of the conversations about the BPS already this afternoon. They have put in place over the last two years a view that freshwater management should be so acutely changed that fundamental land-use change should occur in this country. They talk about the importance of decarbonising the economy. In their own report in the last week, the Ministry for the Environment has made, looking forward to 2035, their assessment that there will be 20 percent less sheep and beef hectares in this country—a drop from eight million; 1.3 million hectares less—to about 6.8 million. Their own report! So here you have the dichotomy of a Government that is out of their depth in terms of knowing how to respond. The only sector which is buttressing the economy from freefall is the food export sector in particular, but their activity for the last two years has been to pull together a suite of policy initiatives—be it carbon tax, be it freshwater, be it biodiversity—all aimed to make that sector feel less supported, more vulnerable, more unable to see a way of continuing to produce what our historic competitive advantage has been. They put in their own Budget Policy Statement that their vision is just transitions away from sectors where we’ve been historically strong in. For goodness’ sake, wake up.

We are part of a world that has got 180 countries. The Government works on behalf of 5 million people whose economic interests are under pressure and under threat, and the way we get there is by producing food and fibre for the rest of the world. Start supporting them. Start working with them. Admit in this House that actually the policy prescription that your ideological hearts have driven you to is wrong and that what is required is a far more holistic approach around what are the strengths of this country. How do we work with those sectors to support them to ensure that the recession that looms in front of us over the next two, three, four, five months is not as acute as possible? For a party that says at its core it represents and cares for people, why don’t you realise that what actually matters for them is a job in an economy that’s working?

DEPUTY SPEAKER: This is a split call. I call David Seymour.

DAVID SEYMOUR (Leader—ACT): Thank you very much, Madam Speaker. Before I begin contributing to this debate on the Budget Policy Statement, I wish to acknowledge, as the member of Parliament for Epsom, the passing of Sir Rob Fenwick, a tremendous man that I was grateful to know, a fabulous conservationist, a fabulous entrepreneur, philanthropist, and New Zealander who will be sadly missed by our community and many others. Farewell, Sir Rob.

When it comes to this Budget Policy Statement, it is only weeks old but aeons out of date. This report forecasts 2.4 percent economic growth for the year—two weeks ago, that was slowing, but believable. In the last week, markets have dropped 15 percent and we’re heading into bear territory. Nearly every bank is telling us we’re in for a rough ride. ANZ has firms’ own activity expectations at the lowest since 2009, the BNZ was first to forecast recession this year, Westpac is forecasting a 28 percent drop in visitor arrivals—this correction has been coming a long time. We have had the longest expansionary cycle in the post-war era and we may be experiencing the greatest correction in that era too. And the anecdotes are scarier: I was talking to a guy who’s a motor vehicle dealer a couple of days ago. He’d just had an order for six utes cancelled after they came off the boat—and why? Because they were supposed to be headed for the forestry industry, and the forestry industry is at a standstill. Businesses up and down this country are moving to plan B because they see what’s coming.

The ACT Party—for two years—has said that we have a Government led by a Prime Minister who is the best marketer in world politics today but the worst deliverer. And what this sea change of the last couple of weeks means is that the day for gesture politics is over; the day for economic management and leadership has arrived. One only needs to look at the bullet points heading up this report on the Government’s Budget Policy Statement and see what they are talking about: “Just Transition … Future of Work … Māori and Pacific … Child Wellbeing … Physical and Mental Wellbeing”—all things that sounded good when times were good, all things that are noble aims if you have a Government that knows how to pay for it, but what’s absent from this Government’s economic strategy is a way to manage the economic downturn and pay for all the good things that they want.

It’s not just that the gesture politics of this Government are ineffective for the economy; they’re damaging. So many of the gestures actually sideswipe people trying to do productive things, which was a problem when we had relatively good economic conditions but is dire now that we face bad economic conditions. Banning oil and gas—the shock of that and the impact on the perception of New Zealand as a safe place to do business is unaffordable. The one-size-fits-all freshwater regulations imposed on the rural sector—which other speakers have rightly noticed is the one sector that can pull New Zealand through because people eat no matter what, even if they don’t holiday—is far too expensive and is forecast to reduce the number of jobs in dairy by 15 to 20 percent with good conditions. The zero carbon Act is a slap in the face for every single farmer in this country. The new tenancy laws mean that people are abandoning the rental market as landlords in droves, pushing up rents and making things harder. Wasteful spending—the fees free, the Provincial Growth Fund. These are nice to haves in good economic times that are unaffordable in bad. This year’s minimum wage increase—ACT started the chorus. Economists from across the political spectrum—Shamubeel Eaqub, Sharon Zollner, the National Party—have all joined the chorus, saying this minimum wage increase scheduled for April must end.

But, finally, if this Government is serious, it must cut taxes to stimulate the economy. The ACT Party has the numbers and the plan ready. If we want to have businesses succeed and keep employing people, we need three tax rates of 10, 15, and 25, and we can see how we do it—

Chlöe Swarbrick: What about poor people succeeding, David?

DAVID SEYMOUR: Poor people pay taxes, too. Chlöe Swarbrick asked about poor people—they pay taxes, too. That’s why you’ve got to cut the taxes. That’s the kind of management this Government needs.

KIRITAPU ALLAN (Labour): Madam Speaker, in times of strife, leadership is that that can turn a steady hand and steer the ship, and to that extent, I want to acknowledge the leadership of the Rt Hon Jacinda Ardern and our finance Minister in particular, the Hon Grant Robertson, for doing what they had always said that they would do—they had planned for a rainy day. At a time when the Opposition were throwing darts when things were well, because this side of the House weren’t spending enough, it was the Hon Grant Robertson that said, “Hey, let’s keep some change in our back pocket for when a rainy day comes.”

Now, if we look at the Budget Policy Statement—yep, the Budget Policy Statement was released in December 2019. That set forth our objectives—our vision—for how we would be, and how we are, approaching our economic growth, but also how we weather storms. We held the hearings with the Hon Grant Robertson, and we questioned him in February. Coronavirus, at that time, was already apparent, and it was an opportunity for all of us, from both sides of the House, to ask poignant questions about how New Zealand would weather the storm as we went into a time of uncertainty.

Now, I call on the Opposition to cease fire with the absolute scaremongering tactics because our populace deserve better in a time of strife. We have just heard from the spokesperson for agriculture for the Opposition—somebody who I’ve had time for in the past—but my patience is wearing thin because I have seen that gentleman go into rural communities and stir nothing but fear. The facts are, over the past two years this side of the House has held the keys to the Treasury benches, the rural economy has experienced a surplus of $6.9 billion. That’s not the scare and fear that the Opposition is touting up and down the country. So I implore those on the left, the right, the centre of the spectrum to find the calm and listen to fact.

The facts are that New Zealand has positioned itself to survive whatever it is that would come our way, and here comes that day. The facts are, at a time when GDP was stagnating across the globe, New Zealand survived that period well; our growth has been tracking comparatively to those of our comparable other countries, higher than most others, where we are sitting at around 2.8 percent. Our debt when we took over the Treasury benches, we were sitting up at around 22.4 percent. Well, under the steady management of this side of the House, that has tracked downwards—we’re sitting at around about 19.5 percent. Comparable to other nations, other nations in the OECD, we are well placed to survive today’s storm.

Now, if we look at the position that we actually find ourselves in, we are at a time of unprecedented—over the last decade—unemployment rates. They’re sitting at 4 percent; not once could the Opposition ever claim that statistic.

We are sitting at a time where New Zealanders are confident—and this is a thing that I think that the Opposition are also struggling with—all the polls are saying that there is a confidence in this side of the House.

DEPUTY SPEAKER: Look, I’m sorry, that has nothing to do with the Budget statement. Let’s not talk about polls.

KIRITAPU ALLAN: Let me turn to the Budget Policy Statement, because that is what is being said in the report that came back: that we are in a strong fiscal position. Now, we are at a time when we are investing, New Zealand, and I want to turn to what that investment means at a practical measure, not a hyperbolic one that the Opposition wants to cast aspersions across. But I want to turn to a real practical measure: investment in our communities. Rural and regional economies have not seen investment like they have experienced until this Government. I want to take Ōpōtiki as an example of that, to talk about the five criteria that we have hit. Māori and Pacific, we make up over 50 percent of the population in Ōpōtiki, and $79.4 million has gone into the Ōpōtiki Harbour investment, creating 1,800 jobs. That, there, is a country that is invested in its rural and regional communities. Thank you, Madam Speaker.

ANDREW BAYLY (National—Hunua): I’m sort of slightly reluctant to stand up because I know you have delicate ears, and, on this side of the House, we have just endured a speech that I think just demonstrates why this Government shouldn’t be on that side of the House, because that was from a person who did not understand the Budget Policy Statement.

Now, before I start officially, I just want to also acknowledge Sir Rob Fenwick. I got to know Rob about 20 years ago, through a business connection, and, during the 20 years I’ve known him, he was a wonderfully kind and great person to be with, and I know his family will be feeling his loss dearly today. But he was a great New Zealander, and it’s very appropriate that we pay tribute to him today.

The Budget Policy Statement: that was only released literally a few weeks ago—very glossy and it looks wonderful on the outside, and there’s a lovely photo here. And, you know, it talks about a focus on wellbeing, and the approach involves identifying areas based on their potential to provide the greatest opportunity to make a difference to the wellbeing of New Zealanders.

And, of course, you know, it’s full of hyperbole and it’s full of wonderful statements and glossy graphs, and they always seem to be going up and then they go down, and it’s got all the stuff that you would expect if you’re making a good political speech. But, actually—and if that member who has just spoken had actually looked at it—this is what it also said: it said that the operating balance before gains and losses, OBEGAL as it’s commonly known, is forecast to be in deficit for the 2019-20 year, and lower each year thereafter, than previously forecast. So by 2022-23, net core Crown debt is now expected to be $9.2 billion higher under the current framework that this Government—this New Zealand First - Labour - Greens Government—has put in place.

Darroch Ball: How much debt did National have? Answer that question.

ANDREW BAYLY: And I’ll tell you what—and I’m just hearing a question from the other side—you know what this figure does not include? Does not—

Michael Wood: I raise a point of order, Madam Speaker. The member has repeatedly and quite aggressively used the personal pronoun, which is out of order, while pointing at one of my colleagues, and I’d bring that to your attention.

ASSISTANT SPEAKER (Hon Ruth Dyson): Thank you.

ANDREW BAYLY: Thank you. And I’d just like to elucidate on that point. The member was asking about the debt figure. I’ll say to you, even though it’s $9.2 billion higher under your Government—being the New Zealand First - Labour Government—

ASSISTANT SPEAKER (Hon Ruth Dyson): Sorry, Mr Bayly, having had that drawn to your attention by the chief whip, it might be useful if you refrain from it now. Thank you.

ANDREW BAYLY: Thank you—the Government. This excludes the $7 billion that is actually off balance sheet and not in the figures—which, conveniently by the Minister of Finance, is excluded from his calculations. And that is very, very substantial. So the talk—and we heard it from the Minister before when he made commentary on this Budget that, you know, we’ve been facing these headwinds, and under our Government, prior to us going in 2017, we were averaging over 3 percent GDP, which is just figures to people listening in. But what has happened, and this Budget statement refers to it, we have seen a substantial drop in the GDP—virtually by half. Now, to put that in context, we have seen the economic growth of New Zealand drop by about $4.5 billion a year. That means we are seeing people—businesses, their profits are lower because they simply cannot sell as much as they might have done if National had continued in power.

We’re also seeing that the spending is lower because it simply is not happening. We’re also seeing that incomes of people are reduced because they have simply not had the money, and if you are running a business where your profits are down, you are not earning that amount of money. So all that $4.5 billion that’s just been disappeared out of the economy last year has just vanished. You can never get it back. It has gone into thin air. That is the problem with this Government. It has slowly ground its way down, starting from a position that was incredibly strong.

And the thing that’s most concerning, when you read the Budget Policy Statement—it talks about the record terms of trade. And what that means is that when we sell our products overseas, we’re getting a very high value for them and when we’re buying those products, buying products to come back into New Zealand—imports—we’re paying less for them. That is the issue that we’ve got. We’ve got record terms of trade for our exporters, so we should be achieving much higher rates of growth, and that has been squandered. That is the thing about this Budget Policy Statement that is so bad, that is so disappointing, because we are unfulfilled potential in New Zealand. We are losing the opportunity to grow this economy much faster as we need to be to be keeping in line with all those dynamic economies in Asia that we’re trying to trade with. That is how you create real wealth.

What this Government has achieved is to settle us back into the old sort of slow growth rate that we were achieving back in the 1980s and the 1990s, which was subpar and had left New Zealand behind, and that’s why we’re falling behind Australia. That’s why we need to get back into a fast-growing economy, but the Government has the problem because it doesn’t quite know how to do it.

And of course, all that was before we suddenly have some real headwinds, which unfortunately is known as COVID-19. That is the issue—that is the issue. We now have people very, very worried in the economy. The thing is—and I spoke about this the other day and some members from the Government laughed at it. The real issue at the moment for those 500,000 small businesses in New Zealand—the issue that will be keeping the husbands and wives awake at night—is not the thought of whether they might get a dole payment, but simply whether they’ve got enough money to pay the wages tomorrow morning. That is the primary issue that our business owners in New Zealand, spread across all the small townships in New Zealand, rural New Zealand, as well as in the big cities—that is what’s keeping them awake at night. That is the fear. That is the fear for these people, because their employees are part of their family and they’re worrying about how they’re going to pay for them, how they’re going to pay for those wages.

So what we need is a Government that knows what it’s doing. And, you know, when you look at situations like this, and they are trying—you need to be able to look at what you are going to do to help. We’ve heard the Minister talk about how we’re going to make it easier for the IRD, more flexible about you paying your tax. Well, actually, if you’re worrying about your wages tomorrow and if you can’t pay your wages and you’re going to have to fire your best friend tomorrow, it’s actually a bit of an academic argument. And, by the way, the thing that tips businesses over is the inability to pay their wages, not actually whether they can pay their tax. It’s the wages that tip New Zealand businesses over. So having this Minister of Finance talking about “We’ll make it a little bit easier for you to pay our tax to us, who earn $83 billion as the Government.” is just the wrong thing and it shows a Minister who does not understand business.

We’ve also heard about these social welfare payments, about on the dole payments. Again, they’re academic. We need people in work, staying in work—staying in work. We don’t want people on the dole going home and telling their wives and their husbands that they have been made redundant, that they’ve lost their job of 20 years, and that’s the situation we’re looking at.

We need a Government that actually knows how to spend, and the trouble with this Government is that it has underspent on infrastructure, particularly on big projects. We’ve lost all the capability, so they’ve underspent at the time we should have been spending, and now when we want to do it, they talk about shovel-ready projects, which basically are National roads, but unfortunately all the people have left. It’s going to take a long time.

Dr Duncan Webb: Bridges to nowhere.

ANDREW BAYLY: Dr Duncan Webb says “No, it’s not.” Go and talk to Fletcher’s. They lost most of their people from Christchurch who went off to Australia because that’s where the current infrastructure boom is.

We also need a Government that will cut unnecessary spend—[Time expired]

Dr DUNCAN WEBB (Labour—Christchurch Central): Tēnā koe, Madam Speaker. It’s so disappointing to hear the usual old stuff: “Cut wages. Keep those minimum wages as low as we possibly can. Let’s have a year of austerity.” That is exactly the wrong thing to do. The Budget Policy Statement is called a policy statement because it sets a tone. It sets a signal.

What has happened? What this shows us is the wisdom of our Minister of Finance, who through good times was having a steady hand on the tiller, saying, “Let’s not be hasty. Let’s prepare. Let’s be in a good position should things turn sour.” And let’s be honest, there are some risks facing New Zealand. COVID-19 is a significant risk, but New Zealand is well placed. It is probably better placed than any other nation in the world because of the responsible management of the economy.

And as for minimum wage, this is exactly the right time to stick to our plan. There is a plan. It’s set out in the Budget Policy Statement and we will stick to it because it’s a good plan. It’s not one that’s going to change simply because circumstances change around us. That’s why it’s a policy statement. The minimum wage increase will ensure that workers are not alarmed, can still spend money, will still stay in their jobs, will go down to their shops, will go out on local trips in the holidays, and will keep the economy turning over. And what’s more, our health system—thank goodness our healthcare system is in good shape.

This Government has invested and will continue to invest in our health system. Our nurses are being paid more. There are, in fact, now 1,699 more nurses than there were, 677 more doctors than there were, and more health workers ready to respond than have ever been in New Zealand.

We’ve put $1.7 billion into a capital spending in our broken hospitals. Thank goodness we’re going to have hospitals that are equipped for any eventuality that comes forward—$1.9 billion into mental health. That’s just as important. Look, we’ve heard about the fear, the panic, the anxiety that’s out there. We need to be prepared. This Government is prepared. The Minister of Finance has rightly identified the weaknesses in our economy, has set a path to address those weaknesses, and that’s what we’re going to do. There is $2.9 billion into district health boards (DHBs), funding that has been desperately needed to make sure that our health workers and our DHBs are prepared for anything that may come their way.

What’s more, the economy isn’t going to come to a standstill. The $12 billion infrastructure programme will absolutely make sure that we have work, that our economy is moving, and not only that but that it’s the right infrastructure, infrastructure not only into some roads but, really importantly, into rail, walking, cycling, but also into clean energy. These are all absolutely fantastic projects that are going to keep our economy going. We’ve got an economy that’s got full employment. We’ve got an economy with low debt, one that’s been running surpluses. But there are clouds on the horizon. Now is the time to absolutely use those resources, with the tax packages, with the Ministry of Social Development, but keep on course. It’s not time to run away. It’s not time to change the programme, because the very thing we were allowing for has come upon us.

This Minister of Finance has prepared us well. This Budget Policy Statement sets out our plan and we are going to stick to it.

A party vote was called for on the question, That the House take note of the report of the Finance and Expenditure Committee on the Budget Policy Statement 2020.

Ayes 63

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

Noes 57

New Zealand National 55; ACT New Zealand 1; Ross.

Motion agreed to.

Bills

Election Access Fund Bill

Third Reading

CHLÖE SWARBRICK (Green): I move, That the Election Access Fund Bill be now read a third time.

I want everybody in this House to imagine for a second. Imagine that you can’t hear me. I’m sure that is something that many of my colleagues in this Chamber would invite and think that they’d very much like, but, of course, I would like them to remove the humour from that proposition. Seriously, I ask my colleagues to imagine that they can’t hear me, but that they can’t hear not just me. Imagine that you can’t hear the question time bells and you can’t hear the conscience vote bells, which echoed across Parliament last night, well past midnight, calling us to work and to vote in the Chamber. Imagine that you can’t hear points of order, questions nor the answers. Imagine that you can’t hear the whispers of colleagues as whips dart across the House and negotiate the day’s business and that you can’t hear interjections and heckles, nor the laughs and the bellows that follow.

Imagine that you can’t hear your co-workers in the office and the hallways, and you can’t hear them in caucus, in cross-party groups, or in select committees. That hearing, that access, that enabling of basic equality, is something that every single one of us in this Chamber, who is currently elected to the House of Representatives, takes for granted. It is proof that this place was made, was designed, for the likes of us. But it’s estimated that nearly 19 percent of New Zealanders experience a form of hearing loss. Thousands communicate via our official language—New Zealand Sign Language, but zero percent of the House of Representatives are currently living that experience. We make the rules for those deaf and disabled New Zealanders, but we regularly do so without any knowledge of their experiences.

Those experiences aren’t just of deafness nor of disability. They are a breadth and a richness of human experiences, of lessons learnt, of jobs done, of advocacy advocated, of lives lived. There is no such pigeonhole nor neat and tidy box of deaf and disability issues. In fact, every single piece of policy, every single debate in Parliament, every single decision that is made impacts the homes, the environment, the country, and the worlds that all of us live in.

Tokenism is someone without a certain experience asking those with that experience to comment on a perceivably niche, narrow something that the person without experience thinks is relevant to those with the experience. It’s permission to provide feedback on a specified little area of things that the person without experience is comfortable letting those with the experience see and participate in. It is paternalistic and it is patronising. It is controlling. Representation is an equal platform. It is not telling someone what affects them but asking them and shutting up and hearing the answer.

What we’re doing today is actually pretty basic, but it’s also hugely fundamental. We are removing the barriers that none of us in this place right now have had to wrangle with. That fact in and of itself is worthy of inspection. Who has been left behind and made invisible in the conversation because they didn’t make it in here?

Just today, I had my executive assistant, Tim Onnes, telling me of the difficulty of bringing people into this Parliament to witness this speech—this third reading speech—about accessibility, about democracy, and how difficult it was for those people to navigate through our Parliament and to engage in this process.

What political candidates didn’t make it in here because they couldn’t afford the unique travel arrangements, the translators, the costly barriers that we didn’t have to worry about? What New Zealanders didn’t even make it to contemplating being a candidate because of concern and fear of the excessive bills and the fuss? Which citizens didn’t even think of this as a possible place for them, and by them, because they couldn’t see themselves in it? Today, we are unanimously fixing a glaring hole in our democracy. If you haven’t seen, felt, or heard that vortex, it’s because it doesn’t affect you. But it just so happens, our official statistics belie that it affects the lives of around one in every four New Zealanders. Today, we are enabling the impartial and politically independent Electoral Commission to administer a fund to remove barriers faced by the deaf and disabled candidates in our general elections and our by-elections. Those are barriers that others do not face, barriers that not one of the 120 members in Parliament right now faced.

They are barriers that were faced by my friend the inspirational Mojo Mathers, the first Deaf member of Parliament here in Aotearoa New Zealand, who gives colour to the narrative that I have laid out this afternoon. It is not just a story, it is not myth; it is literally Mojo’s life. She brought decades of mahi in environmental protection and water quality and animal rights to our Parliament, but she became a disability rights champion because, to be frank, she was just a champion. Thank you, Mojo, for unlocking the doors for those who will come after you. Your law will not just change lives; it will change the face of places like this, and I hope that it will improve inclusion and the thoughtfulness of our society as well.

I also want to mention my mate Joe Boon, who was diagnosed in 2008 with something that I’m probably not going to be able to pronounce, but I’ll give it a shot: Friedreich’s ataxia, which is a progressive genetic neurological condition. This election, he is running—or wheeling, as I’m sure his sardonic sense of humour would allow—in Rangitīkei for the Greens. He is one of a number of deaf and disabled candidates who have stood for parties across this Chamber in the past, present, and, I am sure, the future. This bill gives those candidates—those potential politicians, those New Zealanders—an equal footing, because from the 2023 election, this law means that they no longer will have to shoulder costs that, again, none of us here did. That, quite frankly, is just a fair go.

I really deeply want to thank politicians across this Parliament who I’ve had the privilege to work with so constructively and so fully to bring this law to pass this afternoon. It is not every day that we get to pat ourselves on the back and say that we agreed on a vision for a better Aotearoa New Zealand and that we worked together to do it, but today is different. I know, having talked to many who have been involved in this conversation for so long, of the huge importance and symbolism that comes from all 120 members in this place being united in knocking down those barriers.

I want to say thank you to the Governance and Administration Committee. I want to say thank you to my colleagues in Labour and the National Party and New Zealand First and ACT and to Jami-Lee Ross. I want to say thank you to everybody who has fought so long for this. It can only be the beginning.

I asked my friend Henrietta Bollinger, who helped substantially in developing my thinking coming to this legislation but who is also an impeccable artist and writer in her own right, what on earth I should say to celebrate the passage of this law today, which has taken two years and a whole lot of work. She just offered that it is important that deaf and disabled people are no longer invisible in this conversation. They have a whole lot more to offer than just their disability, but the richness of humanity and experience that all of us have, which exceeds and extends far beyond any of our most obvious caricature.

I hope that I am done speaking on behalf of and instead of. Here is to a House of Representatives.

Hon Dr NICK SMITH (National—Nelson): Thank you, Madam Speaker. National is pleased to support this Election Access Fund Bill. That is a step in the right direction for including a wider range of people in this important institution that has responsibility for the lawmaking and the governance of our country. I want to compliment Chlöe Swarbrick and the way in which she has managed the legislative process around this bill, being a strong advocate for the rights of people with disabilities but also understanding the importance of electoral law and their conduct being in a fair way. I think it reflects well on this Parliament that there is sufficient confidence in the political neutrality of the New Zealand Electoral Commission to have responsibility for allocating these funds.

I also want to acknowledge the advocacy of Mojo Mathers, in her work as a member of Parliament, in making us all more aware of the challenges for the deaf community in being able to participate in parliamentary processes. This bill just actually represents a number of other steps, including providing subtitles and other provisions in our select committees, that have helped make our Parliament more accessible.

The core part of this bill enables the Electoral Commission to set up a fund that will enable candidates for central government elections, parliamentary elections, to be able to apply for the extra costs that they face as a consequence of their disability, and being able to be refunded for that. If there was a disappointment with the bill—and we discussed it at select committee—it was whether it could be included and extended to local government, because, actually, whether it be our deaf, whether it be our blind, whether it be people that have other physical disabilities, the ideal for us would have been to provide a fund that extended it further. We note that the Justice Committee inquiry into electoral law talks about better aligning our local and parliamentary electoral laws, and that is a future challenge from this bill.

Whenever it comes to issues of electoral law, National is of a view that you need to be very careful in the allocation of whether it be public broadcasting funds or others, that you do so in such a way that it doesn’t try and screw the scrum politically one way or other. We are satisfied, through the pursuit of the detail of this bill, that we are genuinely providing a fund that will meet those reasonable costs without the risk of it being used by one political party at a disadvantage of others.

I would have one more cautious view than the sponsor of this bill, in that money is just one of the disadvantages that we seek to address through this bill. Yes, whether it be the extra costs of travel, of accommodation, or of specialised and technical equipment that exist today that is able to assist people with disabilities, I don’t think we as a Parliament should pretend that that removes all of the barriers. I actually think there is equally an attitudinal issue, both for electors, for this institution, for public servants in our society more generally, that we are improving in the way in which we deal with people with disabilities. This bill is a step in the right direction, but I do think we would be a little overstating it in accepting that providing a fund would remove all of those barriers. We still have other issues to resolve, and those attitudinal things is something that Parliament can lead, that Parliament can talk about, but is not something that can be simplistically fixed by a change of law.

So, again, I compliment those that have been advocates for this bill. The Election Access Fund Bill is a bill that is going to improve the diversity of this Parliament. How this Parliament has changed over its 160-plus years in being more diverse in respect of the ethnicities that are represented here, the big change that has seen so many more women in this Parliament, and the hope that goes with this bill is that it will see the full range of people that have different disabilities also having a voice in this institution. I commend the member who has sponsored the bill, and particularly the law change. National looks forward to working with the Electoral Commission so that we can have more candidates for Parliament, and more members, that represent the diverse disabled community.

Hon PEENI HENARE (Minister of Civil Defence): Ka noho au ki roto i Te Reo Māori. Ka tāpae ake ahau i ōku mihi ki Tā Rōpata kua riro atu ki te pō ki roto i ngā hāora tata ake nei. Ka tāpae ake ko ngā tangi mōteatea ki te kaihautū tawhito o Te Pāti Kākāriki ki roto i ngā tau, Jeanette Fitzsimons. Ka tāpae ake ko tōku tuahine, ko Ataria Heta kua riro atu ki roto i te wiki kua pahure ake nei.

Kāti, ka huri tuatua ahau ki tēnei o ngā kaupapa. Ka tū au hei māngai mō Te Rōpū Reipa ki runga i tēnei kaupapa me te kī atu, e tautoko mārika ana mātou o Te Rōpū Reipa i tēnei o ngā pire. E tautoko ana mātou i tēnei Pire nā runga i te mōhio ko te mea nui o Te Kāwanatanga, ko te mea nui o tēnei Kāwanatanga, Te Rōpū Reipa, me Te Rōpū Kākāriki, hei whakararata mai i te hunga hauā, i te hunga turi, i wēnā momo āhuatanga katoa kei tēnei mahi ki roto i Te Whare.

Mehemea kei tēnei Whare, mehemea kei roto i ngā tāone me ngā wāhi noho a te iwi, ko te manako nui kia whakararata mai i te hunga e ngākau nui ana ki ngā mahi torangapū ki tēnei mahi. Koinā tā mātou hei tautoko ake.

Ka whakaaro ake ahau ki taku tamahine ki a Kainoa. He tamahine hauā. E aro atu ana ia ki ngā mahi e tutuki nei e tōnā matua, arā, ko au e tū nei, engari ki roto i ngā ture i a ia tonu nei, kīhai ia ka pā mai tana ringa ki ngā mahi torangapū e mahia nei e tōnā matua nā runga i tana hauātanga.

Nō reira, ka tautoko ahau i tēnei pire. Ka tautoko ahau i tōku hoa mahi e kawea nei te pire ki runga i te manako nui o Mojo Mathers e noho mai nei ki runga. Kāti e mihi atu nei ki a tātou. E tautoko ana mātou i te pire.

[I will remain in the Māori language. I acknowledge Tā Rōpata who passed away in the past couple of hours. I am much saddened by the passing of Jeanette Fitzsimons, former leader of the Green Party for many years. I acknowledge my sister, Ataria Heta, who passed away in the week just gone.

I turn to this particular issue. I stand as a spokesperson for the Labour Party on this issue and I say, we, of the Labour Party, enthusiastically support this bill. We support this bill because one of the main goals of Government, of this Labour-Greens Government, is to support the disabled community, the deaf community, and those types of groups to work here in the House.

Whether in this House, in towns or in other communities, we strongly support those who have a desire to work in politics. We endorse that.

I think about my niece Kainoa. She is disabled. She has taken a keen interest in her uncle’s career, in my career, but the rules as they are now prevent her from entering politics because of her disability.

Therefore, I support this bill. I support my colleague who sponsors the bill on the wishes of Mojo Mathers who is sitting up there. In conclusion I greet everyone here. We support this bill.]

Dr JIAN YANG (National): Madam Speaker, thank you. First of all, I thank the original author of the bill, the former MP Mojo Mathers. Also, I thank the sponsor of the bill, the MP Chlöe Swarbrick, for her skilful work and her hard work.

As the chair of the Governance and Administration Committee, I’m very pleased with the cooperative spirit that parties and members demonstrated in the process of considering this particular bill. I was thinking why we had this kind of cooperative spirit. I believe there were quite a few reasons. Firstly, of course, I thank the MP Chlöe Swarbrick for her skill and her genuine effort to consult these different parties. Secondly, I think this bill itself is quite well drafted—limited in terms of scope.

The reasoning behind the bill is well accepted and easy to understand but, more importantly, I would say it is because all members, all parties, have a genuine intention to support—to help—disabled people. These people are a very important part of our society. They are very close to us. We can relate to them very easily. So for that reason, I believe all members, all parties, are ready to work together to support this very important part of our society.

Now, this constitutes a solid foundation for Government strategies and policies towards disabled people. Our support has become increasingly comprehensive. We’ve given them support in terms of physical support, in terms of cultural or mental or financial support, but now we are moving even closer to what we call comprehensiveness, because we are trying to help them to participate in our general elections, to exercise their political rights, to facilitate them to exercise their political rights.

So for that reason, I believe this bill is a step in the right direction. As the Hon Nick Smith mentioned, this bill may not solve all problems, but it’s a step in the right direction. Also, I would say the committee made some changes, and these changes are useful. For example, the committee proposed by-elections to be included in this particular bill, and to make sure that any successful application to the fund would not be counted as a donation and would be exempt from income tax. All these are important in terms of improving the bill. So I commend the bill to the House.

PAUL EAGLE (Labour—Rongotai): Thank you, Madam Speaker. It’s a real privilege to be in the House to talk to this bill. Can I acknowledge Chlöe Swarbrick in particular and just the doggedness and the hard work to get this to where it is today. I think that takes real courage, but it comes easy for her, because she really took it all the way through, step by step. I was really proud that she took a piece of work that one of her colleagues Mojo Mathers had started. Many others had thought about it, but she’s actually the one that’s got it to the finish line. So more than a pat on the back for that, because this ultimately is about democracy and allowing all New Zealanders in Aotearoa New Zealand to have the opportunity.

I think back to my own father, who had political aspirations. He was a Methodist minister for just under 50 years, so everything was political in our home. But his hearing went, his health went, and so he never quite got across the bar. He said to me, “I don’t know whether people like me are match-fit for that place.” I hope I’m fulfilling some of his legacy, but, more importantly, for all those Kiwis who now have the opportunity to do and get the information and just get the tools—I think that was the one word that I saw in there—to make their opportunity to get into this place happen. We’ll add local government a bit later. That’s important, and I see some city councillors up there—Teri O’Neill—so, fantastic.

Hon TIM MACINDOE (National—Hamilton West): Thank you, Madam Speaker. Just before I address the bill, could I add my words of condolence to the families and friends of both Jeanette Fitzsimons and Sir Rob Fenwick, two very dedicated conservationists, environmentalists, and very fine New Zealanders. I know all members of this House share a great sense of loss at the passing of two very highly respected people.

I thoroughly enjoyed Chlöe Swarbrick’s speech, and I don’t always say that when I listen to her speaking. I’m sure it would be utterly churlish for me to say that I took some pleasure at her invitation to imagine a world in which we couldn’t hear her at all. I want to assure her that sometimes I do look forward to hearing her again.

Today, of course, there have been some very sensible and sensitive contributions from across the House in this particular debate, so I don’t think I need to add much more. I would simply like to endorse the comments that have been made. I do have a very strong personal commitment to supporting disabled New Zealanders to be able to gain access to representation both at the local government level and in the Parliament. I have done everything I can in recent years to support some disabled candidates in my city of Hamilton to achieve representation or election, rather, to our local authorities. I’ll continue to do so until they are successful, because I really believe that that will strengthen the quality of our democracy and ensure that they and those who share disabilities have genuine representation.

Equally, I want to see that happen in this Parliament. I look forward to the day when we see wheelchairs here, not just because somebody is showing sensitivity to a paralysed New Zealander but because a paralysed New Zealander has earned the right to be a representative in this Parliament. That goes across a whole gamut of disabilities. It is the next development in the evolution that Dr Nick Smith spoke about before, so I hope it will happen in my time. We should all work towards that goal, and this bill will help in a small way. I have great pleasure, therefore, in adding my support to it.

Hon TRACEY MARTIN (Minister for Children): Kia ora, Madam Speaker. My contribution is going to be short. It’s not going to be short because I don’t care. It’s going to be short because, actually, we need to release those in the gallery at 6 o’clock so that they can celebrate this moment with Chlöe Swarbrick.

I want to say two things, though, before I sit down. The first thing is that Chlöe Swarbrick has shown, through her actions around this piece of legislation, through the changes made, through the collegial way that she has worked with those from different political poles, how to bring members together and how to work together constructively—and, even, at times, to compromise, because that’s how the world works—to make sure that the goal to improve the world has been achieved.

I particularly want to ask the Young Greens and other young political parties to recognise what Chlöe has done and to acknowledge that it’s hard work but you have to keep doing it because in the real world, you’ve got to play with others. So I want to acknowledge Chlöe and her persistence, but her true maturity around the way that she has worked this through.

The other thing I want to do is I want to acknowledge Mojo Mathers in the gallery. I want to say that I remember when Mojo came, and I remember the fight she had to put up to find the resources to actually do her job, the job she had been elected to do. I remember New Zealand First, when it came to our caucus, saying, “We’ll take a cut in our party budget if everybody else does too, to make sure that Mojo has the technology that she needs.” The Speaker at the time managed to find the cash at the end of the day, so we were all good.

But now I say to the parliamentary precinct, you need to prepare for the inevitable. It cannot be that now that we pass this piece of legislation, the next person who is differently abled has to come into this House and fight, the way that Mojo had to. So let’s prepare the precinct for the multitude of diversity that we have among our population so, again, this House can say that it is a House of Representatives. We endorse the bill.

DAVID SEYMOUR (Leader—ACT): Well, thank you very much, Madam Speaker. I rise on behalf of ACT in support of Chlöe Swarbrick’s Election Access Fund Bill. I’d like to congratulate Chlöe Swarbrick—not a bad effort for an MP to get a member’s bill through in their rookie term in Parliament, and for a very noble cause. I should thank my colleagues in the National Party for letting me speak on this. I didn’t have a call in this debate but I wanted to speak on it because I think it’s an important issue.

I believe that it is important that we have equal opportunity in circumstances where we’re disadvantaged for reasons beyond our control. And it’s not because members of my family have lived and live with disability; it’s a belief in the role of Government—that when we are faced with risks and faced with situations or disadvantages that we have no way of controlling whatsoever, and there’s no way to privately insure against them, that’s actually an area where the Government should provide support. In the case of disability, that is an area where I actually think the Government doesn’t do enough and should be providing more acute support.

I had the experience in the End of Life Choice Bill debate of funding some people with disabilities to come to Wellington and campaign for the bill, and the costs involved were absolutely eye-opening and, frankly, eye-watering for somebody in a wheelchair with their carer to come and engage in our politics. As Chlöe Swarbrick said in her opening speech, no doubt many people in that circumstance who either couldn’t afford it or didn’t have benefactors who were prepared to support them simply wouldn’t see representation in Parliament as an option, and I think that’s wrong. I think that’s one area where the State should be an insurer of last resort, so I’m supporting this bill, first and foremost, because it is good public policy, but, secondly, because it is something that makes us a more inclusive, humane, and compassionate society to put on our statute book that we as a society are committed to helping people participate in our democracy if they have additional challenges that are experienced as absolutely no fault of their own, then that’s when there’s a role for us to help.

So well done Chlöe Swarbrick. Thank you, Madam Speaker. I commend this bill to the House on behalf of ACT. Thank you.

ASSISTANT SPEAKER (Hon Ruth Dyson): The next call’s a split call—Jamie Strange.

JAMIE STRANGE (Labour): Thank you, Madam Speaker, for the opportunity to take a brief contribution on the Election Access Fund Bill. We hear a lot about a representative Parliament—a Parliament that represents all of New Zealand. Tonight we’re seeing some action around that, and I’d like to acknowledge Chlöe Swarbrick for taking a stand and also Mojo Mathers before her.

I was privileged to be part of the Governance and Administration Committee for a brief period of time when Chlöe Swarbrick was working on this bill. Look, she’s certainly done a great job bringing this to the Parliament, and I’m excited to speak on the third reading. This is a victory for democracy and it’s a victory for inclusion in New Zealand. We’ve sort of heard a lot of the content of the bill from various speakers, so I’ll probably finish my contribution there. But I’d just like to reiterate: we hear a lot of talk, but tonight we’ve seen practical action, and it’s really encouraging to see that, so well done.

SIMEON BROWN (National—Pakuranga): Thank you, Madam Speaker, and thank you for the opportunity to take a short call on the Election Access Fund Bill in its third reading. I too just want to acknowledge the sponsor of the bill, Chlöe Swarbrick. We see eye to eye on so many issues, in particular this issue. I also want to acknowledge former Green Party MP Mojo Mathers, who was instrumental in putting forward this issue which this Parliament is now unanimously supporting. I’m really proud to be a member of Parliament on days like today when we do unanimously support pieces of legislation which make a practical impact on people’s lives.

One of the really interesting things about this bill is it’s not just about people who are standing as candidates to be members of this Parliament but actually people who are putting their names forward to be candidates in the party processes or candidate selection processes. We’ve all had to go through those processes as candidates to be selected by our respective parties, and we all know how difficult those processes can be, and the fact that this bill will also support those with disabilities to be able to access this fund and to be able to put their name forward to represent their party and then their community is something which I’m particularly proud of. So I commend this bill to the House. Thank you very much.

GINNY ANDERSEN (Labour): Thank you very much, Madam Speaker. It is great to see this bill reach its third reading in the House today. I’ve watched this as a select committee member on the Governance and Administration Committee and watched the good work that was done by the subgroup that was formed to nut out the policy detail of what shape this bill would take.

I would like to, first and foremost, acknowledge Mojo Mathers for bringing this bill and the shape and also for Chlöe Swarbrick for her continued advocacy for those in the community that cannot always have the same voice and impact as they probably should do. I guess my point in my speech tonight is that while it’s great to see a bill that provides further access for people who deserve it and need it and don’t always have it, it is a shame that that always takes such a big fight. I’ll look forward to the day when we have equality in New Zealand and not every step of the way has to be such a struggle.

I was, I guess, educated on this by a local member of the Hutt community by the name of Mike Grigg who is, sadly, no longer with us. He was a very strong, vocal advocate for the rights of people in the disability community and he was a constant battler to any local member of Parliament or council member that would listen. It is through his continued advocacy and talking with him that I learnt how difficult it can be for people to get what they deserve and have that equal representation with those around them.

So we support the Election Access Fund Bill because of the fact that it facilitates participation of people with disabilities in general elections, and that is only right and fair. It enables disabled people to be given appropriate tools and the ability to be able to compete on an even ground—to run as a candidate, to attend an election event, and to participate as a party member. It is estimated that it is around 9 percent of the population of New Zealand who have some form of hearing loss alone as one area, and it is only right that there should be an ability to engage in debates and communication and have those abilities for the members of our democracy to share and understand what those ideas are.

The Government is working hard to build a more inclusive New Zealand, but we have a lot more to do. We want to be a country that creates opportunities for people with disabilities and that is why I am supporting the bill and why this Government supports this bill.

The Election Access Fund Bill was originally sponsored by Mojo Mathers, and it was back in 2011, I understand, that she became New Zealand’s first Deaf MP. In some ways, while this bill, I’ve said, is a good thing, it is a bit sad in some ways that it’s taken us to 2020 to reach making steps like this, just to enable people to be able to fairly engage and be part of an election process. I’m really looking forward to seeing this bill form part of how we will continue to have elections in the future and to see what differences it brings, what types of candidates we see, and the ideas that they bring into New Zealand. I think we can only be a stronger and more robust democracy with the more voices that contribute to that debate, and I am proud to see a bill that further enables that action to take place. I commend this bill to the House.

LAWRENCE YULE (National—Tukituki): It’s a pleasure to rise and speak to the Election Access Fund Bill, and I want to first of all acknowledge and congratulate Mojo Mathers, who’s sitting behind me, I understand, in the gallery, because it took a lot of courage. I remember the debates and the news articles at the time, and the cost and all the things that were incurred, which was really difficult. But as we stand here tonight, across this Parliament there is universal agreement that this is the thing to do. I wholeheartedly support it, and I wish to thank Chlöe Swarbrick for what she has done, and for the maturity, sometimes I would say, beyond her years of getting everybody together—

Chlöe Swarbrick: Thanks, “Dad”!

LAWRENCE YULE: —you know—to get everybody in the room to agree, and I’ve watched her come into the meetings and get agreement. I think this place would be by far the better place if we had as broad a section of society as we could, including good and participatory representation from the disabled community. Anything we do to go towards that, I think is very worthwhile.

I also would be very supportive in the future of taking this into the local government realm, because I think that is the next stage. We couldn’t do it this time, but it should be done in the future.

This is a complete no-brainer. It’s taken a lot of work to get here, but I am happy to commend this bill to the House.

MARAMA DAVIDSON (Co-Leader—Green): It’s my absolute delight to be the final person in this House tonight to stand as we pass through the third reading of the Election Access Fund Bill, because when we have a House that is truly representative—when disabled people can participate fully in the electoral processes that we all should be able to participate in—it means that Governments are better held to account, it means that we can make better law, and it means that we can make law that actually reflects the realities of people who are of disabled communities. It means that we can build a vibrant, inclusive democracy, if everyone is able to actively and equally engage in it.

I’m so proud tonight of my colleague Chlöe Swarbrick and the deserved attention and accolades that have come from across the House for the way that she has nurtured and carried this piece of good law to us here tonight. I’m profoundly proud of my colleague, ex-Green MP Mojo Mathers, the first Deaf politician for New Zealand, and all of the NGOs and advocacy that has come from years and years of hard work and pressure being kept on this place. I think, for example, of my friend Kim Robertson, chairperson of Deaf Action New Zealand, who is consistently asking us where are our interpreter services for public announcements and for question time in the House, and I hope we can see this legislation tonight as a step to move towards the rest of the things that we have to clean up, especially here in Government and here in Parliament, where we can lead.

I wanted to note that the Disabled Persons Assembly strongly recommended that this fund was not going to be restricted and limited to be diagnosis-specific. I am pleased to say that the Government and Administration Committee worked hard to ensure that it is a wide, contestable fund so that we don’t need to be guided by restricted definitions and can merely focus on what is needed. It is also accessible to non-profit organisations and political parties to start to make sure that we have a wide, round focus on ensuring equal access to these electoral processes, not just from a parliamentary perspective.

This bill affirms that New Zealanders want a fair electoral process. The reason why it has taken so long is not because of nasty intent but because when you do not have people with lived experience, the default is we are going to be coming from a perspective that we are used to, and when you do not have people with lived experience of the barriers to this world which are disabling, it means that we are less capable of making law that realises what those barriers are, understands what is needed to shift those barriers out of the way, and understands that at every step of our world at the moment there are far too many assumptions that are made that we are all the same.

So I’m pleased that this bill, while not the final answer, is an impressive and important step for us to reflect as a country, and, indeed, as a world, to say that this is what needs to happen in every sphere of our public and political life—that we need to make sure that there is equal ability for everyone to participate in what is so-called public life. So I am proud. Congratulations, Mojo; congratulations, disabled community; congratulations, Chlöe Swarbrick; and congratulations, all of us for this work here tonight. Kia ora.

Bill read a third time.

Bills

Auckland Regional Amenities Funding Amendment Bill

Second Reading

Dr PARMJEET PARMAR (National): I move, That the Auckland Regional Amenities Funding Amendment Bill be now read a second time.

It’s a real privilege to take this call to highly commend this bill that I am the sponsor of, the Auckland Regional Amenities Funding Amendment Bill. I would like to start by thanking the Government and Administration Committee for their input. I want to especially acknowledge the chair, Dr Jian Yang, and the deputy chair, Ginny Andersen, and, of course, I want to thank all of the members on the committee as well for working in such a collaborative manner on this legislation.

I also want to thank all the advisers and I want to thank all submitters. We received 14 submissions during the select committee process, and we had the opportunity to hear from one submitter here in Wellington. I would say that that one submitter covered the whole bill really well—the background and the need for this bill.

We did make some changes to this legislation in the select committee process, and those changes can be grouped under two main headings. I will talk about them, but before that, I want to say that I had the opportunity to sub on to the select committee as and when this bill was on the select committee’s agenda. So I’ve been through this whole process, even on the select committee, and I have been in touch with one of the Auckland regional amenities to ensure that we were able to deliver what the objective of this legislation has been.

This bill is to see that the financial reporting standard in the Auckland Regional Amenities Funding Act 2008—the principal Act—aligns with the financial reporting standard that is there in the Charities Act 2005. So, according to the Auckland Regional Amenities Funding Act 2008, the specified amenities are required to prepare financial statements in accordance with New Zealand’s equivalent to International Financial Reporting Standards. According to the Charities Act 2005, they are required to prepare their financial statements as per generally accepted accounting practice.

Now, the important point to note here is that the New Zealand equivalent to International Financial Reporting Standards are part of generally accepted accounting practice, but that is mainly for entities that are for profit, not for entities that are not-for-profit, and these Auckland regional amenities are registered as charities under the Charities Act 2005. These entities are not-for-profit, and so the standard which is required as per the Auckland Regional Amenities Funding Act 2008 should not apply to them, but at the moment they have to in order to comply and prepare their financial statements as per this New Zealand equivalent to International Financial Reporting Standards as well.

So it is, basically, just doubling up their work, and I would say that this should have been fixed when section 42A of the Charities Act 2005 commenced in 2015. But, at that time, that got overlooked, and that’s why these amenities have this issue of non-compliance because they are complying with the Charities Act 2005, because if they don’t comply with the Charities Act 2005 reporting standards, they will lose their charitable status.

We have these amenities. They are really active and are really important to our Auckland community. These amenities are the Auckland Philharmonia, New Zealand Opera Ltd, Auckland Theatre Co., the Auckland Festival Trust, Auckland Observatory and Planetarium Trust—which is based in Mount Roskill at the moment—Coast Guard Northern Region, Surf Life Saving Northern Region, Auckland Regional Rescue Helicopter Trust, and WaterSafe Auckland.

I said that the Auckland Observatory and Planetarium Trust is based in Mount Roskill at the moment, where I’m based. That is because, as we know, we are undergoing boundary changes, and it is quite possible that this amenity may not remain in Mount Roskill. It is not that the amenity is moving out, but the boundary might change, and so this might mean that this amenity will go into another electorate. But that doesn’t matter to me, because this is about helping these amenities that are there in Auckland, and it’s a real privilege to have the opportunity to support this amenity and other amenities—

ASSISTANT SPEAKER (Hon Ruth Dyson): I’m sorry to interrupt the member, but the time has come for the House to adjourn for the dinner break.

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

Dr PARMJEET PARMAR: Before the dinner break, I was saying that one of the Auckland regional amenities that is currently located in Mount Roskill may actually become part of another electorate as we are undergoing boundary changes. But that doesn’t matter, as I was saying, because this is about supporting these amenities, not just one amenity but all Auckland regional amenities.

I also explained why this bill was needed, why the alignment of financial reporting standards in the Auckland Regional Amenities Funding Act 2008 was important to be aligned with the Charities Act 2005.

So now I would like to focus on changes that are proposed by the select committee. In the select committee, as I said before the dinner break, the changes that were made can be grouped under two headings. The first one is around the clarity of the commencement date, because as the bill was proposed there was no clarity around transitional provisions. In the select committee process we thought it was important for us to provide that clarity. So we propose adding a clause, clause 4A, which provides the clarity around the commencement of this change that is proposed through this legislation. This would apply for a financial year that was in progress or recently completed, and that makes full sense.

The second change that was made in the select committee process is actually a very important one, a change that is really important to all these Auckland regional amenities, and that change is about retrospective validation. I’m mindful, and all members on the select committee were mindful, that it’s not a common practice for us in Parliament to make any changes that have a retrospective validation, especially where there is some non-compliance. But in this case, it’s a very different case because this is a minor, a technical, change that we are making to benefit all these Auckland regional amenities. This non-compliance is not harming any other entity or third party. I have already talked about this before the dinner break—that the standard that is required as per the Auckland Regional Amenities Funding Act 2008 doesn’t apply anyway to these Auckland regional amenities because they are registered as charities under the Charities Act 2005. So this is actually something that we should have fixed when section 42A of the Charities Act 2005 commenced, but it got overlooked. That’s why the Auckland regional amenities are required to prepare their financial statements as per these two different standards that are prescribed in these two different pieces of legislation. But they have been complying with the Charities Act 2005, and they have been preparing their financial statements in accordance with public benefit entity standards. So this is something that we must note: that they have been complying with one of these two standards, and they have been complying with the Charities Act 2005.

So the retrospective validation that we have allowed in this legislation, in this bill, in the select committee process, is only for amenities that are non-compliant with the Auckland Regional Amenities Funding Act 2008 as long as they are complying with the Charities Act 2005. So if they are complying with the Charities Act 2005 then we say that retrospective validation will apply. This makes full sense, again, because these amenities don’t want to have any non-compliance in their record. We want to help them because this is actually something that Parliament overlooked when that change was made in the Charities Act 2005. This retrospective validation will apply from that time; that was 2015, so the 2014-15 financial year we are talking about. As I said before, if they are complying with the Charities Act 2005 then only this retrospective validation will apply to these Auckland regional amenities.

So, going forward, I really hope that all sides in the House will support this legislation because this will save a lot of work for these Auckland regional amenities that is not adding value to anyone and, actually, is just duplicating the work that they have to do to prepare financial statements as per these two different standards under these two different pieces of legislation. So I highly commend this bill. Thank you, Mr Speaker.

MICHAEL WOOD (Labour—Mt Roskill): Thank you, Mr Speaker. I’m very pleased to be able to speak on the Auckland Regional Amenities Funding Amendment Bill. It is an important bill. As someone who’s a constituency MP in Auckland, and he’s had a little bit to do with the local government scene in Auckland over a number of years, I have an awareness of just how important these institutions are and the governance and legislative arrangements within which they work as well.

I’m very pleased as well to be able to speak on the bill because one of the amenities that is covered by the provisions of the bill that is what we colloquially call the Stardome, but officially is the Auckland Observatory and Planetarium Trust Board, sits within my electorate. It is within Cornwall Park, on the eastern edge of my electorate. It’s an extremely popular and well-used amenity, and it’s covered by this piece of legislation.

I’ve got to say, one of the best experiences of my life ever, was going along to the Stardome with my wife, having a couple of glasses of red wine, and they put on this marvellous show where they play the two best rock albums of all time, which are by Pink Floyd, of course: The Dark Side of the Moon and Wish You Were Here. Then you sit back and the ceiling of the Stardome is just sort of a psychedelic array of lights, colours, and all sorts of things. It’s a legal buzz, I’d have to say. I’d encourage anyone who’s in Auckland looking for a good night out to go and do that. So I’ve got a strong connection to at least one of the amenities that’s covered by this piece of legislation.

I do want to talk a little bit about some of the background to this, because it is important, I think, to actually understand why it is that we have this piece of legislation that sort of coagulates this big range of cultural and other institutions in Auckland, and, therefore, why we need to ensure that we’ve got the accounting treatment right, as per this private bill, which is amending a principal Act from 2008. That piece of legislation that it’s amending is the Auckland Regional Amenities Funding Act 2008. It was brought through this House by the Hon Judith Tizard at that time, who was the Minister for Auckland Issues as well as a range of other portfolios.

I remember from my time in local government during that period of the 2000s, there was an absolute mishmash of funding arrangements for all of these different institutions, and they include—I’ve got the list here—the Stardome; the Auckland Observatory and Planetarium Trust Board; the Auckland Philharmonia orchestra; Auckland Regional Rescue Helicopter Trust, which is extremely important; the Auckland Theatre Co.; Coast Guard Northern Region; the National Maritime Museum Trust Board—the maritime museum down at the Viaduct Basin; New Zealand Opera Ltd; Surf Life Saving Northern Region Inc.; the Auckland Festival Trust; and WaterSafe Auckland Inc., which does extremely important work in terms of water safety, especially with our kids.

Now, all of these different institutions had different funding arrangements. As it transpired, most of them were based in the old Auckland City Council area, which is in the middle of Auckland. Now we have one local government authority for all of Auckland; back then we had seven. The issue that arose was that, effectively, the whole region benefited from the services provided by all of these institutions, but because they were physically based in Auckland City, the other six territorial local authorities generally didn’t contribute to them at all. This created an unfairness but also funding problems for these institutions. So the solution was to develop a piece of legislation which set up a clear, transparent, and equitable funding stream for them all. Initially, it had a formula-based funding system where each of the territorial local authorities from that region basically paid into a common pool, which then funded these institutions. Then, with the Auckland Council amalgamation in 2010, the arrangement has become somewhat simpler. The Auckland Regional Amenities Funding Board, which is the subject of this piece of legislation, now levies Auckland Council on an annual basis, brings in that money, and then distributes it out across these different organisations.

The problem that has arisen, which this bill rightly attempts to correct, is that when the Charities Act was passed in 2005, it provided that charitable institutions should be reporting in accordance with the generally accepted accounting practice, otherwise known as GAAP, rather than the International Financial Reporting Standards.

I’ll talk in a bit more detail about these; it’ll really light up your night a bit later on. But that was the provision that was set down by the Charities Act 2005, so we’re talking about 15 years ago now. All of these institutions, by their nature, have that charitable purpose. They’re not-for-profit, private organisations. They’re not actually publicly owned council institutions either, even though their funding, effectively, comes from a public source—the Auckland councillors levy—they’re, effectively, all charitable institutions and often also have additional funding coming in from the various ways that charities raise money to support themselves as well: public appeals and the like. So those institutions, under the Charities Act, are supposed to be reporting along the GAAP lines, and that’s well accepted.

The problem is that the legislation has pointed them in a different direction, and that puts them in a very difficult position in that the way in which they’re reporting probably isn’t in alignment with the core piece of legislation that they’re required to adhere to. In fact, what we’ve learnt through the course of this issue is that, in fact, for about the last five years these institutions have not been reporting in the correct way. I don’t think the purpose—I know, in fact, the purpose of the member or anyone involved is not to criticise those institutions for that or put them in the gun or anything at all; it’s actually to try and deal with that problem.

But it does, I think, bring to light a bit of an issue that the House needs to think about with this piece of legislation, but also in the future: how do we make sure that when we bring legislation to this House that has an impact on organisations out there in the community, we’re not having significant oversights like this creep into our legislation again? Because here we have some extremely important institutions in Auckland, our largest city—very, very venerable and important organisations—who have actually been filing their accounts in a way that isn’t in accordance with the legislation that oversees them. That really was through a set of oversights through the legislative process. So I think there’s a bit of reflection there for the House and our processes, to make sure that that is something that doesn’t arise again.

It’s worthwhile talking a little bit about the two key changes that the Governance and Administration Committee has identified in its report back. The first—and I’m not sure whether this was an oversight in the original bill or whether it was just something that needed to be worked out with a bit more information—was setting in place a commencement date for this piece of legislation, which, as I understand it, will be the day after it receives Royal assent. That seems to be perfectly sensible.

The second point is a more interesting one, and that is the issue of retrospective validation. It was raised by the member Parmjeet Parmar in her speech. This is a very unusual procedure in that we’re, effectively, saying that these organisations which for the previous five years were not acting in accordance with the Charities Act and the reporting requirements there, for that period their actions will be validated. Now, that’s not something that I think we should ever do in the House lightly or without questioning or looking into; I think there is a well-established principle that pretty much every member in this House would adhere to that we reserve retrospective legislation only for situations that are highly justifiable—there should be quite a high bar for that.

Parliaments have a lot of power. They have the power to force people to do things. We have the power to force people to give money to the Government. If you start establishing a precedent that Parliaments can go back in time and make rules up that people didn’t know about at the time, that’s not generally a good thing.

So I think one of the things that will be really useful to do in the committee of the whole House stage of this debate, assuming that the bill passes through the second reading, is just to make sure through that process that the House is really comfortable and that we’re doing the right thing there. I’m not necessarily casting doubt on that. It seems to me that in the select committee’s report back, they’ve identified that, effectively, what has been validated is something that does no harm, something that wasn’t done with any malice or intent or ability to gain anything that these institutions would have otherwise not had, and that it’s justifiable because there was also, effectively, an oversight in legislation. None the less, I think it is the duty of the House to look into that very closely as this bill progresses, to make sure that we are satisfied that this relatively extraordinary step of going back and validating in a retrospective way is something that we are properly comfortable with.

This is a bill which, I think, has pretty wide support across the House. As an Aucklander, and someone who knows that these institutions are really important, I want to make sure that this legislation does go through in the appropriate way and supports them in the activities that they do on behalf of the people of Auckland. I do look forward to examining some of those issues in the committee of the whole House stage of the debate. But for now, I very happily commend the bill to the House. Thank you.

Dr JIAN YANG (National): I rise to speak reasonably briefly on the Auckland Regional Amenities Funding Amendment Bill. First of all, I thank the sponsor of the bill, that’s Parmjeet Parmar, and she has been working very hard and I’m very pleased for you to introduce the bill to the committee. The Governance and Administration Committee welcomed the bill and we worked collaboratively on this particular bill to make the bill even better.

Now, basically, the bill would replace a requirement for specific amenities—we have a list of amenities there—to prepare financial statements in accordance with New Zealand equivalents to International Financial Reporting Standards, we call it NZ IFRS, with a requirement to prepare in accordance with generally accepted accounting practice—that’s GAAP. Now, this means that the bill corrects an anomaly in the financial reporting requirements that apply to specific amenities. I emphasise that this is for specific amenities because we are limiting the bill to a certain list, a list of amenities in Auckland—and that is very important to note. So this bill would allow the specified amenities to prepare a single set of financial statements instead of two; now we have two because of the problem of what we call the legislative overlook from 2015.

So let me come to the particular development of this anomaly. What happened, really, is, actually, in 2015, the Charities Act 2005 was amended; it was amended to require that certain—certain—charitable entities prepare financial statements in accordance with GAAP. So to be consistent, some other legislation work was done so some other Acts were amended. However, the principal Act was not amended. So that caused a problem. That means the requirement under the Charities Act to prepare financial statements in accordance with GAAP is in addition to any other reporting requirements under any other enactment. So this is the problem. For that reason, we believe that now we should correct that particular issue.

These specific amenities were required because of an overlook—basically, they had to do double financial statements. But, in reality, they didn’t. So, technically, they have breached the particular Act because they didn’t do two financial statements. So this particular bill will address that particular issue. For that reason, when the select committee was considering the bill, we made an amendment. Basically, this amendment relates to retrospective validation—previous speakers mentioned all these amendments. So this is very important because otherwise these amenities technically broke the law, so we need to make sure that we address what happened in the past. It’s unusual, but we believe it is necessary. We believe that this breach is minor, so we should be able to address that.

Another amendment, of course, Parmjeet Parmar also mentioned is the commencement date. We believe that we need to somehow specify the particular commencement date.

I believe this bill is a minor bill but very useful. It is useful because—we are supporting this particular bill because we support communities. In Auckland these amenities play a quite important role in our life. So, for example, the Auckland Philharmonia orchestra—each year more than 250,000 hear the orchestra live. So it’s a large number of people. And then many people would, of course, listen to CDs and watch TV—all these. So it’s very important we support amenities like this. And then you have New Zealand Opera and you have some others like the Auckland Arts Festival, that’s very important for ethnic minorities. And you have the Auckland Stardome observatory. I remember that I took my kids to the observatory. So all these amenities play a very important role in your life and therefore the bill is minor but is very useful. Thank you.

Dr DEBORAH RUSSELL (Labour—New Lynn): I rise to speak on this interesting bill. It is a technical bill, a tiny bill, a teensy bill. However, is not a trifling bill or a trivial bill and even though it deals with accounting standards, it’s not even a tedious bill. It’s a trimming bill, a tidying bill, a bill that sets matters to rights. And, as has been said across the House, it is a bill that we should all support and, indeed, I think we are all supporting this evening. As this bill has gone through an absolutely standard process of going to a select committee and of hearing submissions from entities that are concerned with the particular bill, I just want to report back on some of those particular submissions that came in from the entities that are concerned.

The Auckland Theatre Co. said that they support the intent of the Auckland Regional Amenities Funding Amendment (ARAFA) Bill and that they’ve reviewed the submission of the Amenities Board and they support that particular submission. The coastguard said that they have reviewed the ARAFA Bill and that they support the bill and that they support the submission put in by the Amenities Board. Drowning Prevention Auckland says that they support the bill, the ARAFA Bill, the Auckland Regional Amenities Funding Amendment Bill. They support the intent of the bill. They have reviewed the submission of the Amenities Board and they support the Amenities Board submission. There is a theme here. New Zealand Opera likewise says that they have reviewed the bill, that they have reviewed the submission from the Amenities Board, and they support that submission. This will get to a point in a moment. Surf Life Saving Northern Region—exactly the same submission: they support the intent of the ARAFA Bill and they support and adopt the submission of the Amenities Board.

Mr Assistant Speaker, as I am sure has been your experience and the experience of many of our colleagues across the House, often when there are identical submissions coming in to a select committee, we become a little wary of them. We wonder who is running a campaign; if there is a particular purpose. Sometimes because the submissions are all identical, we count them up but we place perhaps less weight on them individually just because they are clearly all identical. But I submit that this is, in fact, an exception to this particular case and that even though all these submissions are virtually identical, they are pointing to something very important: that there is, in fact, solid agreement from the entities that are affected by this bill that the bill is a good bill and it should be passed.

So carrying on from there, the arts festival—the same submission supporting the intent of the bill, supporting the Amenities Board submission. The same from Mr Michael Woods’ favourite psychedelic place to go: the Auckland Observatory and Planetarium Trust Board supporting the bill, supporting the intent.

There were, however, two exceptions, two submissions that were exceptions to this virtually—and this why I have to say the word “virtually”—unanimous support for the Amenities Board submission. One, which I do want to read out, but I won’t read out the submitter’s name because perhaps it’s a point and we should listen to it, says, “Personally, I think the government spends way too much money. Too much money on Auckland, too much money on tourism, too much money on traveling and too much money on trying to fix things that weren’t broken! … Stop increasing taxes and give money back to the people you stole it from; kiwis. And if you want to spend millions on something unnecessary, then take it out of your personal bank accounts!” Well, what an interesting submission. We do from time to time get submissions where it’s clear that people have sat down with their mates late at night, had a bit of a yarn, and found something to do and put in a submission. Perhaps that was one of those.

Rather more seriously, Julia Durkin submitted on this particular bill, and she is a professional senior cultural producer and the longest-serving female festival director of an Auckland regional arts, cultural, and community organisation. She says that actually there needs to be a “broader investigation of the overall purpose of the [2008] Act itself.” In fact, she doesn’t really submit on the bill itself but she does point to a need for some kind of review needed for that Amenities Board, so perhaps that is something that could be considered at some stage in the future by people in Auckland.

So coming to the Amenities Board submission—and that, of course, is the point of all of this—the Amenities Board clearly supports the intent of the bill, and it explains very carefully why it is important. It is straightforwardly because the Act as it was written, and along with the development of accounting standards alongside it, has imposed an extra compliance burden on the entities that are affected by the bill. Now, these entities are all charitable organisations; like many charitable organisations they are comparatively small in scale. And so it is important to try to reduce the compliance burden where possible with respect to that. So that is a good reason to support the bill. So as I’ve said, a lot of unanimous support for the bill.

I do want to speak, as a former accountant, just a little bit about the difference between generally accepted accounting practice (GAAP) and IFRS for us. So that’s G-A-A-P—GAAP, as it’s normally referred to—and IFRS, the International Financial Reporting Standards. Perhaps this will be the tedious bit of the evening, but I promise you that to accountants it’s very, very exciting. GAAP are the common set of accepted accounting principles, standards, and procedures that companies and accountants must follow when they compile their financial statements.

One of the interesting things about having been trained in accountancy is having developed that understanding as a set of shared ideas as to how transactions ought to be reported, how accounts ought to be prepared, so much so that for me, when I’m trying to understand a particular way or the particular economic impact of a transaction, one of the easiest ways for me to do it is to write out a journal entry, because I understand it through that accounting framework. Having done that, I can grasp the substance of what is going on, and, of course, that’s what generally accepted accounting principles are trying to do. They’re trying to develop a set of rules that enable people who read financial statements to get a grasp of what is going on, whereas IFRS, the International Financial Reporting Standards, they’re an international set of standards and they talk about how particular types of transactions should be recorded.

The problem that is fixed by this bill is that many of these boards, the charitable entities that were affected by the particular Act, ended up having to prepare two sets of financial statements. They were supposed to prepare two sets of financial statements. Now, it’s not that difficult. It doesn’t take a lot to translate from one to the other but it was unnecessary. More to the point, it turned out that many of these entities weren’t actually even doing the two sets of financial statements. Now they were prudent. They were managing their money well. They were accounting for it properly. There is no suggestion anywhere of any impropriety or anything like that. Nevertheless, just because of the way things had fallen out, they weren’t actually complying with the law and they weren’t actually preparing those two sets of financial statements.

Perhaps, ordinarily, you might think that was possibly something that should be sanctioned and there should be a sanction associated with it, but that would be a sledgehammer to crack a walnut—not worth the effort. So this bill actually turns it around and says, no, rather than imposing that unreasonable compliance burden, let’s fix the problem. And that is, of course, the job of the Parliament: to fix the problem, to make it the best we can for our constituents and the entities that are affected. That is our job as parliamentarians: where we see a problem, to do our best to make sure that we, if can, put it right—that we make things better and easier for the people we work for.

So, as I said, a small bill—a small bill—but it has some interesting aspects to it, and it’s a bill that I think will make a difference to the Auckland Philharmonia, the Rescue Helicopter Trust, the coastguard, the theatre company, Drowning Prevention Auckland, New Zealand Opera—all good organisations, all worthy organisations, all organisations that, of course, add to the cultural and social and sporting life of Auckland. I support this bill.

JENNY MARCROFT (NZ First): Tēnā koe, Mr Speaker. An absolute pleasure to stand on behalf of New Zealand First to speak to this, the second reading now of the Auckland Regional Amenities Funding Amendment Bill. Absolutely a pleasure indeed to take my call because New Zealand First will support this private bill.

I’d like to start my contribution by noting that I’m not a bean counter; so I’m not able to give you the detail and the background relating to the accounting practices, as my good colleague Dr Deborah Russell has been able to do with her extensive background in taxation and accounting matters. And I also, too, would like to make note of my other colleague, Michael Wood, and his contribution giving us the historical background to the formation of these amenities coming together in the Auckland region. I’d note also, too, the member who has this bill in her name, Parmjeet Parmar, also too noting that she said that this doubling up was overlooked and therefore this is a small but technical bill that needs fixing, and therefore we are very supportive of ensuring this bill goes through all of its stages. As I mentioned, it is a small and technical bill, and making changes that require these specific amenities to prepare financial statements in accordance with generally accepted accounting practices.

So I would like to talk to what I know of some of these amenities, having spent 20-odd years in the Auckland region. My colleague Michael Wood talked about his relationship with the Stardome and, as a part-time stay-at-home mum, I was very much always there as a parent help whenever the school went on their trips, And, of course, coming from the Warkworth region it was always great to come into Auckland to visit some of the facilities there, and Stardome was of particular interest for all the parents. You had to get in line really quickly to put up your hand to be parent help on that particular trip. So, although we didn’t get the whole The Dark Side of the Moon, Pink Floyd experience that we heard in the House from Michael Wood, I think that for the children that went, and all those schoolchildren who have been to the Stardome, what an amazing experience that large 360-degree planetarium theatre is. What they learn about science, what they learn about their place in the world, and what they learn about space sets their minds to creative and wondrous things. So I think, really, if there was an opportunity for me to go back as a grown-up without being parent help, I’d really be excited to have one of the other amenities which are in this bill—maybe the Auckland Philharmonia, if they could play at Stardome, perhaps giving a grand rendition of Gustav Holst’s The Planets - Mars, the Bringer of War. That would be my cup of tea indeed.

I won’t go into the historical background; that has been covered. The bill has been well outlined by the member Parmjeet Parmar, who has brought this bill to the House, and the accounting practices certainly have been well traversed as well. I would just like to say a couple of other points, though: that New Zealand First absolutely supports this bill. They are common-sense measures to bring into alignment the practices of the specified Auckland regional amenities and the legislation that governs their financial reporting. And, just a quick wee note, as I finish off my short contribution: it was under National, specifically Paul Goldsmith, that the change in the Charities Act in 2015 was passed without spotting the impact that this would have on the amenities in this bill. So today we’re here as part of the process to fix that up. I’d like to commend this bill to the House.

SARAH DOWIE (National—Invercargill): Thank you, Mr Speaker. Of course I rise in support of this private bill in the name of Dr Parmjeet Parmar—absolutely fabulous colleague and a hard-working list MP that has brought this bill to the Parliament to fix up on behalf of these amenities that need this to save them time and save them cost.

But may I begin by saying that it’s an absolute pleasure to be back on the Governance and Administration Committee after announcing that I won’t be seeking re-election. I started my political career in 2014 as the deputy chair of the Government Administration Committee—I think, too, with you, Mr Chair, on that select committee. It’s a great select committee—such a breadth of information, and what Dr Jian Yang doesn’t understand is that there’s probably going to be a bit of a coup d’état because I’ve never been chair of that committee, and so he’d better watch himself, because it’s quite a powerhouse select committee. And, of course, no wonder this bill was referred to that select committee.

We’ve heard the bill and what it does traversed quite significantly, and I think my colleague Dr Parmjeet Parmar set it out very, very well. She set out the background. She set out the need for why the bill was so necessary and then talked about the ramifications, and while bills are not always exciting, they are of course necessary, and this is to save time and cost to these organisations that are out there providing benefit to the Auckland community.

So, look, the purpose of this bill, quite succinctly, is that it removes from the Auckland Regional Amenities Funding Act 2008 the requirement that specified amenities prepare financial statements according to the New Zealand International Financial Reporting Standards and to allow for specified amenities to prepare a single set of financial statements that comply with generally accepted accounting practices. And that, as I said before, is going to save time and cost and angst to the people that are involved in these organisations. So let them get on with the job, let them get on with providing benefit to the Auckland community, and let’s make it easier for them. And with that I support this bill.

JAN LOGIE (Green): Thank you, Mr Speaker. I rise to take a short call on behalf of the Green Party in support of the National Party member Parmjeet Parmar’s private bill, the Auckland Regional Amenities Funding Amendment Bill, and to congratulate her on the successful progress of the legislation as well as the introduction of it.

The House is in unanimous support, it seems, of this—as I think was described by the member herself—quite technical bill. It’s addressing an identified problem in Auckland for the Auckland regional amenities—and there’s a range of those from, as we’ve heard, the observatory to the Auckland Festival Trust and the Auckland Regional Rescue Helicopter Trust—where the way the legislation is currently being set up they’re being required to comply with the Charities Act, which uses and requires them to put in financial reports at a particular time of year, according to a non-profit—I think the shorthand is GAAP—generally accepted accounting practice, but the legislation also requires them to put in accounts at a separate time of year according to International Financial Reporting Standards. Primarily, those reporting standards are for for-profit agencies and don’t fit neatly for not-for-profit organisations, and all of the amenities are not-for-profit organisations.

So this legislation means they can just put in the one set of accounts that reflect the nature of their organisations, and the select committee’s consideration of this—and the member Deborah Russell well traversed the submissions in her contribution—is that there is very clear support for this legislation from everyone. The committee, I guess, found out through that process that, while this was the legal requirement, quite a few of the organisations were not—and they were just complying in terms of the Charities Act and putting in their accounts, which was very sensible but we don’t want that uncertainty for people and we want people to be able to comply with the law and for that to make sense. And this piece of legislation enables that. So we support it.

PRIYANCA RADHAKRISHNAN (Labour): Tēnā koe e Te Mana Whakawā. I rise with great delight as an Auckland MP to take a call on the Auckland Regional Amenities Funding Amendment Bill, which is quite a mouthful but is actually, as members previously have said, a technical bill that makes a tweak. Now, many of us come to this House to pass, or to see the passing of, sort of bold, ambitious, progressive legislation—sometimes quite controversial. But also, equally, the other role that this House plays is to make sure that legislation, as and when is required, is tidied up so that legislation is accessible to members of the public, and also so that legislation actually makes life a little bit easier for people and doesn’t complicate things for them. And this bill falls into that latter category, but that doesn’t make it any less important to the people whose lives it does affect.

So what this piece of legislation, once passed, would actually do is remove the requirement that specified amenities prepare financial statements in accordance with what’s actually two different sets of rules, as it were—so not in accordance with the New Zealand International Financial Reporting Standards—and to allow specified amenities to prepare just a single set of financial statements that comply with generally accepted accounting practice.

Now, at this point, I just want to go into a little bit of detail because it hasn’t been traversed tonight previously. Often when we launch into our viewpoints on a piece of legislation, we do get questions from those who do watch us speak to these bills, asking us questions about some of the more detailed aspects of it. For example, in this bill, not a lot of people realise what specified amenities are. So, now, what this bill does is amend the Auckland Regional Amenities Funding Act 2008. Under that piece of legislation, there was, basically, a particular board that was established as a result of that principal Act, and that was the Auckland Regional Amenities Funding Board, which incidentally was also a submitter to this bill, which makes sense because they’re significantly affected by this. Anyway, that board—in accordance with the Act, Auckland Council pays a levy that the board then disburses to nine specified amenities, and those are, essentially, the organisations that are at the heart of what we’re discussing here today.

They are the Auckland Philharmonia Orchestra, New Zealand Opera, Auckland Theatre Co., Auckland Arts Festival, and, as my colleague Michael Wood mentioned previously, Stardome Observatory and Planetarium, that I like to think lies between his electorate of Mt Roskill and the Maungakiekie electorate that I’m based in, and is a beautiful place, as he mentioned as well—and of course, Coast Guard Northern Region, Surf Lifesaving Northern Region, Auckland Rescue Helicopter Trust, and WaterSafe Auckland. So if you were to look at this, this is basically a range of organisations that deliver some really important services to what is, essentially, the largest city in New Zealand and an incredibly diverse one. These are organisations that deliver arts, culture, recreational, heritage, rescue, and other safety-focused facilities and services to the entire Auckland region.

Now, I looked at some of the submissions that came through on the bill—and, actually, before I go there, I might just traverse some of the recommendations of the proposed amendments that came through the select committee. This, of course, is a second reading. And so, also at this point, I just want to acknowledge all those who submitted on this bill, took the trouble to do so—some of them were very substantive submissions as well and made some really interesting points. Two proposed amendments, substantive amendments—one, of course, was around the clarity of the commencement date, and that came through from one of the submitters as well.

Basically, there was a call to make some of the transitional provisions in this bill clearer, because the bill as introduced doesn’t actually state when the proposed changes would come into effect. And that would be important to the organisations that are affected by this because they would want to know, if there are transitional provisions, how those come into effect. And so the recommendation by the select committee that considered this bill was to set out transitional provisions in Schedule 1AA.

Now, the second point is one that I will come back to in a little bit more detail, but, basically, this is a retrospective bill. It fixes an anomaly that came into effect in 2015 because, really, the Government of the day didn’t have the foresight then to see that what they were doing then was going to cause this problem for a number of organisations—and I will come back to that, because it’s actually laid out very well by one of the submitters as well.

So the External Reporting Board’s submission was one that I found really interesting. It was quite substantive, and it lays out very clearly what the crux of the problem is. They have said, “We understand that the specified amenities in the Auckland region within the scope of the Auckland Regional Amenities Funding Board are all registered charities and therefore already subject to the financial reporting requirements in section 42A of the Charities Act 2005. The Charities Act establishes requirements for charities to report in accordance with [generally accepted accounting practice] (GAAP)”, which is a different financial standard, as I understand, and one that is actually being used a lot more than the older standard that previously these organisations were required to report to.” Going back to the quote, “or in the case of smaller charities to report in accordance with a non GAAP standard issued by” from this particular board that was submitting. And they go on to then basically say that a registered charity that determines it’s a tier 1, a tier 2 public benefit entity. That’s actually the crux of the matter here, because the two different reporting standards, one was actually more for profitable entities, and these organisations—the nine that I outlined previously—aren’t. They’re not-for-profit entities and therefore shouldn’t be subject to that same reporting standard as well. So anyway, I thought that particular submission laid out the issues really well.

Now, going on to the submission and to the points that I wanted to go into in a little bit more detail. That was the board, the Auckland Regional Amenities Funding Board, which of course is the one that disperses the levy from the council. Now, they said, “Amendments made to the Charities Act that came into force in 2015 resulted in the specified amenities having to produce financial statements, according to both the New Zealand International Financial Reporting Standards and GAAP.” So that was a little bit unfair because these organisations—already not-for-profit, generally already struggling with compliance—had to then comply with these two completely different and often conflicting standards as well. And this, as they’ve said, places unnecessary burden and cost on those specified amenities.

I spent a number of years working in the community and voluntary sector, running an organisation that wasn’t quite within, I guess, the ambit of what these nine organisations provide, but similar in the sense that, you know, you’re struggling, you’ve got to—one, not you—one has to apply for funding, one has to comply with often a number of different reporting requirements, auditing requirements. And any requirement or any burden that we can lessen for these organisations is a really good thing. It then also takes away the burden from the people who work for these organisations as well. And essentially, that’s what this bill does.

But the final point that I wanted to make is that, at the end of the day, this is a bill that fixes a mess that the previous National Government created. And that seems to be a little bit of a trend, because that’s what this Government is doing as well. We’ve inherited a mess across a number of sectors, and that’s what, for example, our infrastructure funding spending is aiming to fix. So a little bit of a change here—a bit of a mess, not a lot of foresight, and now we’re going to go about having to fix that. And in the interim, it was unfortunately those non-profit organisations that had to bear the brunt of what was a lack of thought, a lack of foresight by the previous National Government. But this bill, all said and done, fixes an anomaly. It’s a good thing for a number of organisations and a number of people, and I’d like to commend it to the House.

ASSISTANT SPEAKER (Adrian Rurawhe): I call Chris Penk—five minutes.

CHRIS PENK (National—Helensville): Thank you very much, Mr Speaker. It’s not every day of the week that one gets to speak to a private bill—but it does give me an opportunity as a pedant to point out that the phrase “private member’s bill” is an incorrect one. So we’ve got members’ bills, we’ve got private bills, but a private member’s bill—there is no such thing. [Interruption] That’s right, Mr Scott. The equivalent in radio transmission terms is that irritating phrase “over and out”. One finishes one’s transmission and says “over”, meaning that it’s the turn for the next person, or one says “out”, and that means one’s finishing. Anyhoo, moving on.

This is a private bill, as I say, the Auckland Regional Amenities Funding Amendment Bill, and I was interested to read the Governance and Administration Committee report, noting the breadth of submitters. One particularly caught my eye, the Surf Life Saving Northern Region. They’re in my patch in force and I would like to recognise their contribution rescuing, actually, a couple of different bits of legislation this week, as well as many souls off the West Coast and elsewhere.

They also submitted to a different select committee earlier in this week on a different piece of legislation, so kudos to them. Others have mentioned submitters, including the New Zealand Opera. They seem to have been singing off the same song sheet and the Stardome, meaning that we could say that the support is almost universal.

So we come to the main purpose of the bill, which is really to align in the area of accounting standards. I must admit that until tonight that represented a bit of a gap in my knowledge, and the Hansard folk can decide how they wish to spell that—perhaps as the acronym GAAP, for generally accepted accounting practice. It seems to be pretty clear across the House that that’s—well, it’s generally accepted that’s a worthwhile thing to do for these various amenities to prepare their books in that way.

It’s not every day you get to do a good accounting joke or even a bad one, but I say it’s been recognised. It’s worth throwing in every now and then for the sake of balance. It’s also been marked down in the ledger by a couple of colleagues, and I’m indebted to them. I’ll conclude by just—

Hon Members: Argh!

Alastair Scott: He’ll be finished soon. Don’t worry.

CHRIS PENK: Yes, I’m about to be struck off, I think. Anyway, on a more serious note, and in an area in which I’m at least a little less inexpert: retrospective validation. Well, this doesn’t seem to disadvantage anyone who had been relying on the rules, so that’s not a bad thing in itself, and, in fact, the overall effect of the bill is very positive, as others have noted. I also support this bill.

RAYMOND HUO (Labour): Tēnā koe, Mr Speaker. I rise to take a reasonably short call to support this bill—[Interruption]—that will be full and comprehensive, because it’s such a wonderful and comprehensive bill. On that note, I’d like to start by acknowledging Dr Parmjeet Parmar for sponsoring this very important bill. Also, I would like to follow my colleague the member for Mt Roskill, Michael Wood, in acknowledging the former member the Hon Judith Tizard, the Minister for Auckland Issues, who introduced the principal legislation in the first place, and, of course, I’d like to acknowledge all those members, former and current, who worked tirelessly to make Auckland a better city and a better place.

This is a small, technical but very important bill. Currently, the combination of requirements under the principal Act and the Charities Act of 2005 means that specified amenities under the principal Act would have to meet two different accounting requirements. My learned colleague Dr Deborah Russell, in her earlier contribution, explained the difference with, in particular, generally accepted accounting practice. So this bill is designed to fix that part of the problem. Again, this is a small, technical but very important bill.

In terms of technical issues in this space, we have spent a considerable amount of time talking about similar technical issues—for instance, the big three: Moody’s, Standard and Poor’s, and the Fitch group. The big three credit rating agencies and their credit ratings and their impact on central government’s and local government’s ability to raise funds.

As a member of this very busy coalition Government, I’m very glad to report that before Christmas, this busy Government introduced and passed the first reading of another technically driven bill which enabled an SPV, or special purpose vehicle, which enabled long-term, private debt financing. That particular bill was important if you look at the infrastructure package—the $12 billion infrastructure package—to build and upgrade our roads, rail, schools, and hospitals.

Now, back to this bill—

Hon Members: Yes.

RAYMOND HUO: —ha, ha!—I’d like to echo my learned colleague Mr Chris Penk. We spent a good time when we were both members of the busy Justice Committee. We have since moved on to another select committee, as some members have acknowledged and noticed, and, pretty much, the work’s just followed us. So, whichever committee we have got involved in, that committee has become very busy, which is a good sign, because for the Justice Committee, for instance, we got 22 bills and it sent 22 bills back to the House for their second reading.

Back to this bill, again. The select committee—

ASSISTANT SPEAKER (Adrian Rurawhe): I don’t think we’ve hardly got there.

RAYMOND HUO: —recommended two important amendments—[Interruption] I don’t know why this particular bill is that interesting to all the members across the board. But, anyway, the second-most important recommendation recommended by the select committee is with regard to retrospectivity, because, as Michael Wood explained in detail, why it is very important for us to introduce that particular amendment is simply because that went to the very nature of this bill. On that note, probably I should say I commend this bill to the House.

LAWRENCE YULE (National—Tukituki): It’s with pleasure I rise as a member of the hard-working, highly organised professional Opposition. Unlike Raymond Huo, the previous speaker, I’ve never been on the Justice Committee, and therefore I won’t be talking about anything that is on the Justice Committee. I’m going to talk about this bill, which is the Auckland Regional Amenities Funding Amendment Bill.

This side of the House is supporting it, obviously, because it’s come from one of our fine members, Parmjeet Parmar. She’s brought it up. She’s worked with her local community and understood over time that there’s something wrong in the way the accounting standards are being used. Effectively, tonight we are seeking to make right something that has been wrong. And really what this is about is entities that provide wonderful services and facilities in Auckland that are not run for a profit—so the International Financial Reporting Standards (IFRS) do require people to prepare reports in accordance with the generally accepted accounting practice (GAAP).

But the point of this is that IFRS really was set up for profit-making entities, and, therefore, the entities that we’re talking about—the Auckland Rescue Helicopter Trust, Surf Life Saving Northern Region, and others—are really in the wrong place. Effectively, those entities have been charged with preparing two sets of accounts, or, if not, they are in breach with either IFRS or GAAP.

So this bill, basically, says that you can, effectively, replace the requirement to use IFRS and you can prepare accounts according to the generally accepted accounting practice. This will remove cost and effort and hassle, and, importantly, mean that these entities are compliant with the law. It does require some validation, some retrospective validation, and the Governance and Administration Committee looked at that. We sought advice on whether that was appropriate. The advice from the officials was that it was an appropriate thing to be done. No harm had been done by what had happened up until now. It might have been a technical breach, but no financial material change had occurred. So, for that reason, the committee accepted it.

The other thing that is important here is many of these are run as charities, and, as charities, they are required to prepare financial statements according to the generally accepted accounting practice. So once we’ve done this, they will be compliant with the generally accepted accounting practice for charities. There’ll be no requirement to do two sets of accounts, and this will save time, money, and effort for the charities involved to get on with the work with which they’re charged with doing. We support this bill.

ANAHILA KANONGATA’A-SUISUIKI (Labour): It is an absolute privilege to stand here tonight to make a call on the Auckland Regional Amenities Funding Amendment Bill, also known as the “ARAFA” bill. Was it “ARAFA”? “ARFA”—a-r-f-a—“Bill”?

I want to acknowledge the member Dr Parmjeet Parmar for this bill. Thank you, Dr Parmar. I acknowledge her chairwomanship. Every time I visit the Education and Workforce Committee, I’m always respectful of the chair.

Before I get on to the bill, I want to talk about my visit to Papakura High School on Monday. The principal, John Rohs—I need to say this because, every time I get up, I’m always talking about how privileged I am to be under the leadership of the Rt Hon Jacinda Ardern. I’m always saying that, and I think it’s important that we hear the voices of the community leaders, of what they say about the Prime Minister. I want to quote now Principal John Rohs. He was a principal in Christchurch, in Aranui High School.

Hon Poto Williams: Aranui High School!

ANAHILA KANONGATA’A-SUISUIKI: And he’d set out to say—kia orana to you, Minister Poto Williams. What he said to me was about his description of the Prime Minister. And I quote: “She’s made it so worthwhile to be in New Zealand.”

ASSISTANT SPEAKER (Adrian Rurawhe): Order! You need to relate that to the bill.

ANAHILA KANONGATA’A-SUISUIKI: And I’m bringing it to the bill.

ASSISTANT SPEAKER (Adrian Rurawhe): Otherwise I’m going to have to terminate your speech.

ANAHILA KANONGATA’A-SUISUIKI: OK. Kia ora, e Te Mana Whakawā. So I’m bringing it to the bill because Papakura is in Auckland, and we are the biggest city in New Zealand. The Rt Hon Jacinda Ardern lives there, and, of course, Anahila Kanongata’a-Suisuiki—I live there as well.

So this bill was—I’ll just give you a brief history, in case they have forgotten. The bill was introduced on 12 September, and it had its first reading on 25 September and was referred to the Governance and Administration Committee. I might say I have not been with the Governance and Administration Committee. I have not been a visitor to that committee, and I look forward to it. Today, from that awesome committee, they recommend that they have examined this, the Auckland Regional Amenities Funding Amendment Bill. They have examined it and they report that we should support it. I’d like to take this opportunity to acknowledge the select committee: the chair, Mr Jian Yang; Ginny Andersen, a member in the Hutt south; Kanwaljit Singh Bakshi; Sarah Dowie, who spoke earlier before; Paul Eagle, the awesome member for Rongotai; the Hon Peeni Henare, the current member for Tāmaki Makaurau; Willow-Jean Prime; Lawrence Yule; and, of course, contributions by Dr Parmjeet Parmar.

I want to continue my acknowledgment of the 12 organisations that had provided submissions—

Hon Member: Who were they?

ANAHILA KANONGATA’A-SUISUIKI: —and out of the 12, nine had actually supported it. So the question was, who are they? I will oblige by naming all 12. They were the Auckland Philharmonia Trust; the Auckland Rescue Helicopter Trust; the Amenities Board; the Coast Guard Northern Region; the Auckland Theatre Co.; the Auckland Regional Amenities Funding Board, again; Drowning Prevention Auckland; the External Reporting Board; the New Zealand Opera; Surf Life Saving Northern Region; the Auckland Festival Trust; and, of course, the Auckland Observatory and Planetarium Trust Board.

When I read this bill—I’m not a member of the board—it reminded me, as a 15-year-old, of when I was filling out the tax returns for my friends and families, and charging them a donation of 20 bucks, and it also reminded me—and I want to acknowledge all the non-Government agencies out there—of when I was the treasurer for Pacific islands women’s group PASIFIKA, when I was completing the end-of-year accounts. It reminded me of that, because my brain, like the observatory in Onehunga, it almost exploded into the universe. So when I read the bill, that’s what it actually reminded me of.

It is a very important bill, because what the bill, in simple terms, is saying is it’s for the organisations whose livelihoods depend on this—the Auckland Regional Amenities Funding Amendment Bill is about completing one set of accounts. And I want to get to that. I want to say—yeah, it’s one set of accounts.

Hon Meka Whaitiri: Shared services.

ANAHILA KANONGATA’A-SUISUIKI: That’s right. So the bill seeks to amend, and what it would correct, like our previous speakers have spoken about, is an anomaly in financial reporting requirements that apply to special amenities such as the Auckland Festival Trust. Tonight, in Auckland, in every March, for the last I think four years—12 years, actually—we’ve got the Auckland Festival. And tonight, I know that you’d rather be listening to me than be in Auckland listening to Hollie Smith—she kicks off the Auckland Arts Festival—where she’s going to be singing the Māori version of “Bathe in the River”, or the “Bohemian Rhapsody”, in waiata, in Te Reo Māori. I don’t think everybody would like me to sing it; they would prefer that Hollie Smith does it. That’s one of the charities, which is the Auckland Festival Trust.

I want to make special mention that it has been 50 years since the Auckland Rescue Helicopter Trust have been in operation, saving lives in Auckland for 50 years. I want to say thank you for what you do. The Surf Life Saving Northern Region, at a glance: they have, in the last year, 427 rescues, 1,000 youth aide teachers, and 43,000 prevention actions involving over 128,000 people, all of those in 88,500 volunteer hours. I just want to say thank you to the Surf Life Saving Northern Region. Thank you for what you do.

Last, but not least, in terms of the organisations that I’m going to acknowledge, is the Auckland Philharmonia Trust, which also provides a programme at the Vodafone Events Centre in Manukau, which is in Auckland south, or South Auckland, as everybody knows. I really like their programme. They especially have a one-off programme called—well, the special concert of “Pese! Fasi! Pūoru!” And it’s about music for everybody, making orchestra something for everybody.

So, like I’ve said before, the member Dr Deborah Russell referred to International Financial Reporting Standards (IFRS) and she referred to generally accepted accounting practice (GAAP), but the bill would replace a requirement for specified amenities to prepare financial statements in accordance with the New Zealand equivalent to international financial reporting standards with a requirement to prepare in accordance with generally accepted accounting practice. So when I heard “GAAP”, I was thinking “What’s GAAP?” Anyway, I realise now that it is the “generally accepted accounting practice”.

Again, I just want to remind the House what the purpose of this bill is. The purpose of this bill is to remove from the Auckland Regional Amenities Funding Act the requirement that specified amenities prepare financial statements according to the New Zealand International Financial Reporting Standards—which is, like the member Dr Deborah Russell referred to, IFRS. It is to allow specific amenities to prepare one single set of financial statements that comply with generally accepted accounting practice—that comply with GAAP.

So like I said before, my head when I was listening to the member for Mt Roskill, Michael Wood, talking about the Stardome at One Tree Hill, when I studied this bill—yeah, my head almost exploded into the atmosphere, because I think for most people it says “tiny anomaly”, but actually, as a ratepayer in Tāmaki-makau-rau, in Auckland, this is important so that we enable these nine groups that are receiving funding from the Auckland Regional Amenities Funding Board to complete their financial obligations.

Again, I want to acknowledge all 12 organisations that submitted. I don’t think I will oblige by repeating who they are. But I want to also acknowledge the select committee, who have actually recommended that we support this bill, and, of course, last but not least, the sponsor of the bill—and it is a member’s bill, not a private member’s bill. That’s an obsolete word, “private member’s”. It’s a member’s bill from Dr Parmjeet Parmar. Thank you very much for this bill, and congratulations. On this member’s day, I would like to commend this bill that has been recommended by the committee. I would like to commend it to the House. Mālō ‘aupito.

JOANNE HAYES (National): What can you say to that, eh? Ten minutes of fluffing around, but well done to you—well done to you! Great. You’ve done the best speech tonight—you’ve done the best speech tonight. Mine is going to be so very short, because every aspect of this bill has been traversed tonight, and a lot of other areas that had nothing to do with this bill. But I just want to congratulate my colleague Dr Parmjeet Parmar for this wonderful bill, and I commend it to the House. Thank you.

Bill read a second time.

Bills

Broadcasting (New Zealand on Air and Te Māngai Pāho Reporting Requirements) Amendment Bill

First Reading

Debate resumed from 10 December 2019.

JENNY MARCROFT (NZ First): Thank you, Mr Speaker. The media in New Zealand is in crisis. In fact, the media around the globe, around the world, is in crisis, and there are two ways it is in crisis: it is in a crisis of trust, and there’s also a crisis of the economic model. What has happened over the last few years is that we have a disruptor that’s come into the media landscape. We have a global disruptor—Facebook and Google—and they have sucked the advertising revenue from our local broadcasters, and that is crashing the economic model, the business model, of our media broadcasters.

Through the use of Facebook and the like, people are seeing their news, gathering their news, from sources that are not our traditional broadcasters, and a lot of what they are seeing is clickbait stories, fake news, and that has created a lack of trust in the media. When there’s a lack of trust in the media, that absolutely erodes our democracy. It is really important that we ensure that our media are trustworthy, and we ensure our media are robust and are—the fourth estate—one of the pillars of our democracy. That’s why I’m really passionate about broadcasting. My career of 30 years led me to this House just a couple of years ago. The media currently has a really important role to play with COVID-19; a role in ensuring the public have the right information so that there is not hysteria and pandemonium because of clickbait headlines. That’s the sort of background of where we’re at with our media at the moment. So I turn now to the bill, the Broadcasting (New Zealand on Air and Te Māngai Pāho Reporting Requirements) Amendment Bill.

New Zealand On Air is our funding agency, along with Te Māngai Pāho, who funds our Māori broadcasters—that’s Māori Television and iwi radio or Māori radio. There are 21 Māori radio stations in our network. The problem that I have with this bill is that it has no objective. It simply requires New Zealand On Air and Te Māngai Pāho to collect vast amounts of information and somehow report every three months on that vast amount of data that they gather. It really is bureaucracy gone mad, and it will put a handbrake on New Zealand On Air and Te Māngai Pāho getting on with the job.

One of the important things that Te Māngai Pāho and New Zealand On Air are currently doing is they are working away, providing programmes to be made to ensure that we increase our content of Te Reo Māori on air, so that we are able to reach out to our communities, to have Te Reo Māori accessed by more people. This bill won’t help any of that. This literally is gathering data for the sake of gathering data, and when we have a media ecosystem where we have linear TV which is in decline, we have people listening to the radio, although the audiences still remain strong and stable, and then we have digital platforms where people are accessing content as well—it will be very difficult to gather up that data when, for example, a video goes up on an on-demand channel. Maybe it’s TV1 OnDemand or ThreeNow, and over what period of time will you gather that data to see how many people have watched that particular programme? They’ll tap in on demand when they want to see it, not necessarily by appointment-viewing that we traditionally have—for example, with the 6 o’clock news or Coronation Street.

So the gathering of the data here is all well and good, but there will be no meaningful analysis which would make it worthwhile to do. So I think, generally, of the fact that our media ecosystem is so challenged at the moment, and we’re working on strong and important ways of what we should do about particularly our public broadcasters at the moment to ensure that they survive not just now but into the future. I therefore feel that we have, as a coalition Government, a lot of work to do that matters in the broadcasting space, and we shouldn’t waste any time on this bill.

STUART SMITH (National—Kaikōura): Thank you, Madam Speaker. It is a pleasure to speak on my colleague Melissa Lee’s fantastic member’s bill. There’s going to be quite a contrast between the previous speaker and myself, but I have to respect her passion and enthusiasm for the subject. However, that’s about where we finish in agreement.

I think the previous speaker, Jenny Marcroft, said there was no objective in the bill. There is an objective: it’s transparency. It’s all about—

Hon Chris Hipkins: More red tape.

STUART SMITH: —actually understanding what is being done. Actually, I hear a bit of a yapping over there about red tape. Actually, all this data is actually gathered. The only thing at the moment is NZ On Air only publish the top-10 performing programmes that they actually fund. So the data is all there. It’s easily gathered.

We’re in a new world today, and, unfortunately, those supporting the old formats of media are actually being left behind. They’re being overrun. What’s important about having objective measures is understanding your audience. That’s not at all to say we should only fund the most popular programmes, but we have to ensure we’re reaching the audience that we want to. If we set out to target a programme at a certain audience, how do we know if we’re reaching them? If we don’t measure it in some way, we won’t know. Of course, there’s a bit of a fear of sunlight here and in the industry, I feel—particularly on the other side of the House—and I think that’s a shame.

Great programmes like Country Calendar have been funded by NZ On Air. It’s a phenomenally successful programme. Ironically, it’s a country subject but the audience is mostly based in Auckland, and female. How do we know that? Because they gather that data. The producers of that show do a lot of work to ensure that they balance off telling really good country stories but also ensuring they appeal to that audience that watches it every week.

If they didn’t have that data, they wouldn’t know how to keep that programme up in the minds of people. The whole world has changed in this space. We used to have a lot of long-form documentaries in New Zealand and around the world, in fact. That has gone by the wayside, except for on YouTube now. That has become the new, hot sector on YouTube, which is long-form videos, interviews with people like Joe Rogan, or the Weinstein Brothers. You know, I watched an hour long interview the other night with Bjorn Lomborg.

Those things are very popular and, yes, they don’t appeal to a mass audience, but they are getting millions of hits. The only reason we know that is because that’s easily measured on YouTube, and it’s publicly available. You can see it. The viewer can see how many people have watched it. So it’s really important that we know that. It may be that we need to have our taxpayer dollars looking at doing those long-form sorts of interviews and putting them up on YouTube rather than broadcasting them on TV. But that’s what we should be aiming at.

We’ve got a broadcasting system that is here to tell our stories, but how do we know that people are listening? It seems that there’s a selective deafness on the other side. Well, you know, it’s all about socialism on that side, obviously. But I think it’s quite interesting reading the Better Public Media Trust chair Peter Thompson’s quote—and this is the mentality of it—he thought the bill “would pervert the whole point of having public content funding agencies because it would expose them to [the cool winds of] performance”.

Well, you know, really, he has to come back to the real world. It is a world where we want to ensure that our public expenditure goes to the direction we aim it at, not into some sort of ether and have it all disappear down the toilet.

Kieran McAnulty: Save Country Calendar.

STUART SMITH: Country Calendar’s a great show. Actually, I’d like to wind up with the one union that I really support—apart from the rugby union—which is the Taxpayers’ Union, and that is Jordan Williams, whose great quote, I think, was that he called this bill—it should be renamed the “Spinoff TV Memorial Bill”. On that note, I commend this bill to the House.

GARETH HUGHES (Green): Kia ora, Madam Speaker. Ngā mihi nui ki a koutou katoa. I rise to oppose this legislation. I think the last member actually gave a good explanation of the different world views and visions, and also a clear argument why we need public broadcasting. That member listed off a litany of overseas-based YouTubers with the inference, I think, that, look, we don’t maybe even need public broadcasting in New Zealand, because there are all these YouTubers out there like Joe Rogan. Now, Joe Rogan’s a good YouTuber, but I think that—

Kieran McAnulty: Who?

GARETH HUGHES: Joe Rogan.

Kieran McAnulty: Who’s he?

GARETH HUGHES: He’s a YouTuber and a podcaster. Well, the thing is that that member didn’t list a single New Zealand YouTuber or podcaster. Now, if we’re going to see New Zealand stories actually told in our media—and I get the member’s point that there’s a whole bunch of different content platforms where we consume media—we’ve actually got to support it. That’s why the Green Party can’t support this legislation, because we want to strengthen, enhance, and greater fund public broadcasting.

I do want to acknowledge the member. It’s a big moment in a member’s career when a bill is finally pulled. I know it took me four years for my first bill to be pulled. It is a big moment.

I want to acknowledge the member for putting a bill in about public broadcasting. It isn’t the issue that always gets the headlines, but it is a foundational issue for our society, for our democracy, and it’s so important. It is what we turn to as a country as we count down to the anniversary of March 15. It is what we turn to with the COVID-19 pandemic. It’s the source of information, and we want to see better public broadcasting. It’s just a pity it’s not a bill that the Green Party can support at this point in time.

If only it was a bill to increase funding for public broadcasting. If only it was a bill to enhance concert radio and other cultural entities we provide. If only it was a bill to support independent journalism. But it’s not; it’s simply a blunt instrument to require quarterly ratings information.

Now, this isn’t going to address the challenges. There are a number of challenges facing the broadcasting sector, from funding, convergence, and disruptive business models. However, I think there are five key reasons why the Green Party, sadly, can’t support Melissa Lee’s member’s bill at this point. I mean, we point out, as other members have, the blindingly obvious, that it already happens. NZ On Air already collects this information. It is an element in their funding decision—

Kieran McAnulty: Red tape.

GARETH HUGHES: —but our point is that it shouldn’t be the pinnacle or the paramount reason that funding decisions are made. Otherwise, you get, you know, Celebrity Treasure Island, and not the quality public broadcasting which we so desperately need in this country.

I’d point out other contributions that it might actually not be legally possible. I’d point out that focussing on this simply increases the costs, and other members have yelled out about red tape and regulations. I would note the irony after the bonfire of regulations only a couple days ago. I don’t know why we’re increasing the administrative burden.

I’d also point out that it increases cost, and the point raised by Morgan Godfery: “[Te Māngai Pāho] does not always purchase [this rating] information [already] so [this] Bill would create an additional cost”, and “the quarterly reports could be used … [that Te Māngai Pāho’s] low rating shows do not provide value for money.”, because what we know is that you’re contrasting oranges and lemons. It’s a total different thing, and we do acknowledge that fear portrayed by Morgan Godfery.

So when it comes to the key issues facing broadcasting and the sector in New Zealand, this bill is, sadly, a little bit too little, too late. You know, for nine years we saw RNZ suffer under a funding freeze. I remember questioning Paul Thompson, the CEO, and he told me in select committee a few years back that they had even stopped putting in funding requests under the previous Government because he said, “It was like hitting your head against a brick wall.”

I would point out that this Government has increased the funding—$15 million to NZ On Air and RNZ. In the member’s defence, you know, it’s hard to fix all the issues of convergence and disruption in a member’s bill, but we can’t be supporting a piece of legislation which is actually going to make the status quo worse, in our opinion. So we note the work undertaken by Minister Faafoi to review the sector, the increased funding. The Green Party will always vote for bills which increase funding for public broadcasting, that enhance the sector, that grow it, and that strengthen it. Sadly, this isn’t one of those bills.

Hon CHRIS HIPKINS (Minister of Education): I just couldn’t help myself; I’m irrationally excited about this bill. I have to tell you, I think NZ On Air do an amazing job. We should remember about the history of NZ On Air—of course, it came from the broadcasting fee. NZ On Air was the way we used to distribute the proceeds from the broadcasting fee, before the broadcasting fee was done away with.

Once upon a time, if you owned a television set, you had to pay a broadcasting fee, and that broadcasting fee was collected up, and it was used to produce New Zealand content. Then, I think it was the National Government that actually did away with the broadcasting fee and shifted that into general taxation so that New Zealand content on our TV and radio was to be funded through general taxation rather than through a dedicated broadcasting fee.

Since that time, successive Governments have taken measures and done everything they can to ensure that as much of that money as possible is spent on producing quality New Zealand content. We want to make sure that the money that goes into broadcasting actually makes New Zealand content, rather than getting sucked up in bureaucracy. That is one of the reasons why this bill fails at the first hurdle. It wraps up more resource in a red tape bureaucratic process. It means less money will get spent on producing content in the first place.

The last National member who spoke, I can’t remember who it was, made the point that it won’t be too difficult because all of this data’s already available. In which case, if the data’s already available, what’s the need for the red tape, for this new regulatory requirement? Because that’s effectively what this is: a new regulatory requirement to report something new. What’s the point of it, if the data’s already publicly available and can already be used to inform decision making, other than simply to add unnecessary regulation?

But then I thought, “Aha! It’s OK, though, because I heard Simon Bridges say that for every new regulation the National Party introduces, they’re going to abolish two.” So when I heard this bill was up, I rushed down to the House and I grabbed a copy of the bill because I thought there’s going to be two more regulations that are going to be abolished in this bill.

So I looked at the bill and I read it and I read it again, and there is no bonfire, because not only does this bill introduce a new regulation but it doesn’t take any regulations away. So that promise lasted less than 48 hours—

Kieran McAnulty: Worst bonfire ever.

Hon CHRIS HIPKINS: That’s right. That is the worst. I mean they’re not even in Government yet and they’ve already broken their big promise to set a bonfire of regulations, because they’re already trying to introduce new regulations from Opposition. That’s quite an amazing feat that on the same week that they promised that they were going to be reducing regulations, they are now trying to progress a bill through the House that would increase regulatory requirements and bureaucracy.

So let’s turn to the provisions of what those regulations would involve New Zealand On Air doing. So, basically, they’re going to have to collect data on television ratings, online view clicks or counts, radio ratings, other viewership tracking data, and a breakdown of the associated costs for the programming funded. All of this information would be available anyway. You may have to pay for it, OK, but it’s already there. That data is available to those who wish to purchase it. So why would New Zealand On Air need to pull that information together if not for a pointless bureaucratic accountability compliance-focused exercise that would add nothing to the quality of broadcasting in New Zealand. It will do nothing to increase the hours of programme content that it produced—in fact, it could do the absolute opposite of that—and it will result in them spending more money on producing more reports and more paperwork and less money doing their core job of producing quality New Zealand content.

So I have no hesitation in saying that the Government and the Labour Party, party in the Government, will not support this ridiculous bill. It’s a waste of the House’s time. It’s a waste of the Parliament’s time. National should be focused on honouring their promise to reduce regulation and they could do so by withdrawing the bill.

ANDREW FALLOON (National—Rangitata): Thank you, Madam Speaker. It’s a pleasure to take a call this evening, which I think will only be a brief call, because it is quite a brief bill, and, actually, a very simple bill and a common-sense bill. It is the Broadcasting (New Zealand on Air and Te Māngai Pāho Reporting Requirements) Amendment Bill. What I can’t quite understand, even after listening to the better part of five minutes from Minister Chris Hipkins, is quite why it is that the Government are opposing this bill, and I’ll come back to that in a moment if I can. But I just want to run through really quickly what this bill does, because it is very straight forward. All it will require is for New Zealand On Air and Te Māngai Pāho to publish quarterly reports that show viewership figures of every project they fund, including television ratings, radio ratings, online views, and any other viewership reporting tools, along with a breakdown of the costs associated.

I sit on the Economic Development, Science and Innovation Committee—a very good committee—where we regularly discuss broadcasting issues, and one of the things I find most useful in those discussions is looking at some of the broadcasting data, and particularly viewership figures. They allow us to track interest in programming, and particularly trends up and down, and, more than anything actually, to make assessments about value for money. But one of the challenges we have in doing those assessments is often we get data that doesn’t quite line up, or comes from different sources, and so it makes those assessments about cost-effectiveness far more difficult.

So this bill would make those discussions a lot easier because it would allow us to match up across a number of different platforms who’s viewing or watching or reading what. So it would be a very valuable addition, because, after all, this isn’t just about MPs, though, it’s not just about the assessment that we make; it is about the public—the wider public and allowing taxpayers also to make those assessments, to say, “We’re not watching something. Why shouldn’t we know if we’re not watching something, and then we can decide if, or not, it is valuable to us?” Because that programming is, of course, paid for by taxpayers, and that’s not actually something that’s been raised at all by Government members tonight. When New Zealand On Air funds something, that money comes from taxpayers. So why wouldn’t we let them know—quarterly, as this bill would—what exactly it is New Zealanders are watching and what they’re getting for their money.

Now, I did listen to Minister Chris Hipkins take five minutes to outline some of the reasons why the Government’s voting against this bill, and one of the reasons he highlighted was red tape. Now, that made me laugh, because it’s not very often a Labour Minister comes down to this House and complains about red tape, but the reason he said, “We can’t have this bill because of red tape.” Well, actually, Minister, this bill is about transparency. If all we were concerned about was red tape and putting compliance on to Government agencies and departments, we wouldn’t have the Official Information Act, because that is red tape, but it’s an important tool for transparency in a democracy. So I can’t quite fathom why it is that the Government would be voting against this bill, which is all about transparency.

Now, I don’t think there is some grand conspiracy as to why they’re voting against this bill—why they don’t want the public to know who is watching or viewing what—I just think they’ve got it wrong. So I do ask the Minister, who’s come down to the House, which is actually quite surprising—he perhaps has been listening to some of his colleagues giving speeches on earlier bills and thought, “Gosh, I need to get down there and get things back on track.”—but I would ask him to reconsider his position on this bill and reconsider the Government’s position on this bill. At least support it to select committee so that it can go there, we can hear from those taxpayers, we can hear from New Zealanders about why it is they deserve that information and why this bill should be passed.

KIERAN McANULTY (Labour): Thank you, Madam Speaker. I’m very, very pleased to be able to speak on the Broadcasting (New Zealand on Air and Te Māngai Pāho Reporting Requirements) Amendment Bill. I think it’s a tremendous use of taxpayers’ money to have members of Parliament speaking on bills that, really, are unclear on what the problem is that they’re trying to solve! The thing is that we have a proposal in front of us that would impose costs and regulation on two agencies that, actually, for the nine years prior to this Government, were severely underfunded, and now we’re wanting to put more burden on them to release information that’s already available. I’m quite staggered really that when we are standing here today—the very week that the leader of the National Party indicated that his solution, heading into the 2020 election, was to light a regulations bonfire. He said that “Regulations are going too far, creating a lot of cost and burden without merit.” They want to ignite the regulations, and what do they do now?

Hon Chris Hipkins: Does the bill self-combust?

KIERAN McANULTY: The bill may as well self-combust because it’ll be the only thing that this bill achieves.

The thing is that this bill is utterly pointless, and this message was sent very clearly, before we came out to even consider the bill, by two notable media commentators. And I have here in front of me: “Broadcaster Russell Brown noted that New Zealand On Air is committed by law to funding programmes for various niche audiences, which can’t sensibly be measured simply by commercial ratings”. The chair of the public campaign group Better Public Media, Dr Peter Thompson, who said, it was “ironic” that “Melissa Lee received millions of taxpayer dollars to make … Asia Downunder” but now wants to change the law in what he described as “an attack on low-rating public media content.” Because, of course, we mustn’t forget that the function of New Zealand On Air is to “reflect and develop New Zealand identity and culture” and to ensure that a range of broadcasts are available to provide for the interests of minority and special groups by making funds available for broadcasting, producing, and archiving programmes.

If, under this bill, New Zealand On Air was forced to release rating information, we put it to the member and to this House that this bill would undermine the core functions of New Zealand On Air—the very reason why New Zealand On Air exists. What this would do is it would say, “See you later, Country Calendar, and hello, ‘Celebrity Treasure Island: MasterChef Special’ ”. That is what we would see. We would see a race for ratings, and those key programmes that many minority and core interests in our society rely on would be kicked down the road. Absolutely, they would be shot down in pieces for the sake of ratings. And we all know the examples of the programmes overseas, coming out of the places like America and the UK; programmes like the The Ricki Lake Show and The Jeremy Kyle Show—stuff that really wants to broadcast the best of New Zealand society, wants to really raise the minority interests, and tell the New Zealand stories, because, of course, that is what New Zealand On Air is for.

This bill would impose regulations and red tape and cost and bring New Zealand On Air away from its absolute core functions. We say that that is wrong.

It would be an expensive implement, it would bring no gain whatsoever, and it makes me wonder. In the proud history of National Party members’ bills, I think this goes up there at the top of the list with Nuk Korako’s infamous baggage-handling bill, because it identifies a problem that isn’t actually a problem and tries to bring a solution to something that doesn’t need one.

I think Melissa Lee and the National Party are opening themselves up to criticism of the old-fashioned ballot stuff. I think that they wanted to fill a gap and they struggled with ideas. Of course, they want to get into Government after the next election, and if this is the best they’ve come up with, I don’t think we’ve got anything to worry about. I think we’re going to be all right, because the fact is that New Zealand On Air, when adequately funded—and particularly after the significant funding boost that this Government gave them—is able to go back to its core functions of producing content that tells New Zealand’s stories and that broadcasts our stories to the nation and to the world. It is unburdened, it is solely focused on its core purpose, and this bill would severely undermine that.

MELISSA LEE (National): Thank you, Madam Speaker. I would like to start my contribution in the closing of this bill by acknowledging the contribution of my colleagues on the examination of what I consider a vital piece of legislation for the future of broadcasting funding transparency. I want to say how deeply saddened I am to see, yet again, this Government, who chose to actually announce themselves as the most open and transparent in history, has closed ranks to deny that openness and that transparency that they promised—that access to information on the performance of publicly funded media by deciding not to support the bill.

Earlier, Jenny Marcroft talked about the convergence, and I acknowledge her knowledge of the mediascape and how there is actually huge convergence and disruptors out there. I would have thought that that member, at least, would have understood that having decent data and decent transparency and openness would perhaps help in the actual funding, and that more programmes could actually be funded.

I am particularly troubled by the decision by the Green Party, who—despite their broadcasting spokesperson having given me repeated personal assurances that they would support the bill—sent me a very late-night email just before the first reading began last December, and said that after having said they would support it, they couldn’t support it any more. That was because they had had a conversation with the Minister, and that’s the reason why they couldn’t actually support the bill. For a party that once prided itself on making our Government and public services more open, this, in fact, is the new low.

I respect my friend Gareth Hughes across the House. He has been a wonderful friend in select committees and I respect his views. But, you know, to tell it how it is, it was, in fact, at the direction of the Minister, and that is the only reason why the Green Party will not support this bill to select committee.

You know, for the past two years, our country has had to deal with every form of shady deal—clandestine meetings and constitutional outrages at a volume that would make most Third World nations blush—so it is truly disappointing when the Minister of broadcasting is actually having secret meetings with the head of news and content at Radio New Zealand. I mean, come on—this is a real low. When members of a Government who are in coalition or in confidence and supply are not able to support it because the Minister has actually put his foot down, I think it’s a real shame.

I truly believe that transparency in this area is required, and for those people who do not understand the process for members’ bills, often members’ bills are put into the ballot many years before they have their first readings. This bill was put in the ballot well before Mr McAnulty’s presence in this Parliament, and, luckily, it was actually drawn and we had the beginning of its first reading last year.

In terms of transparency, one of the members—I think it was Mr McAnulty—talked about my former role as a producer of a television programme called Asia Downunder. Yes, it did actually get funding from New Zealand On Air, and one of the problems that we had was that because we were a small production company, we could not get Nielsen ratings when we requested TVNZ and New Zealand On Air to provide the ratings so that we knew exactly how many people were tuning in, because this data can be very helpful for producers. It was very difficult to get our hands on it. I’ve also had emails from independent producers—much smaller ones—who do, in fact, struggle to know the data. Knowing the data of viewership helps producers.

This is not just about transparency of numbers to see what New Zealand On Air is actually funding, where the funding is going, and how many people are viewing but it also helps the producers to make decisions about their content. I think they’re missing out on an opportunity, and I believe that sharing stories and ideas of our history—today marks the continuation of the struggle of those creators and producers because this Government cannot decide to be transparent. It is a real shame that members of the Government in this House, across on that side, cannot support this bill to select committee. It is a real shame.

A party vote was called for on the question, That the Broadcasting (New Zealand On Air and Te Māngai Pāho Reporting Requirements) Amendment Bill be now read a first time.

Ayes 57

New Zealand National 55; ACT New Zealand 1; Ross.

Noes 63

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

Motion not agreed to.

Bills

High-power Laser Pointer Offences and Penalties Bill

First Reading

HAMISH WALKER (National—Clutha-Southland): I move, That the High-power Laser Pointer Offences and Penalties Bill be now read a first time. I nominate the Justice Committee to consider the bill.

Put simply, New Zealand is well behind other countries in addressing the menace and the clear and present danger of high-powered lasers that pose a huge risk to our aviators, police, and the travelling public. In this bill, I seek to double the imprisonment sentence from three to six months and double the fines from $2,000 to $4,000.

The statistics are truly alarming. In the last six years, there has been a 130 percent increase in laser pointer cases, and 717 recorded cases since 2014. In the previous two weeks alone, there have been three cases: one where a man was arrested for flashing a laser at a police Eagle helicopter in Christchurch, and the others were a small plane in Wellington, and then, the following night, a two-seater aircraft was targeted. That’s two incidents in two nights. Time and time again, we are now reading about reoccurring cases of lasers being pointed at aircraft, which puts a huge amount of lives at risk. People continue to point lasers at helicopters and planes, which just demonstrates that the current penalties simply are doing little to deter offenders. What we need to do here is to deter these offenders.

Last year, the Ministry of Health released a report which stated, “It is of continuing concern that numbers of laser strikes on aircraft continue to increase.” The report also stated that “Countries vary in their approaches to managing the risks from [high-power lasers] from raising public awareness to calling for voluntary improvements in labelling. However, there is consistency in terms of strong controls countries apply to address aircraft laser strikes, including bans and high penalties.”, yet, at present, under this current Government, we’re letting offenders do as they please, getting away with murder as laser strikes on aircrafts continue to increase. When will enough be enough? Do we have to wait until there is a disaster, or a plane comes down from the sky, or loss of life before this Government acts? When will they take a stronger stance to show zero tolerance to this idiotic and highly dangerous behaviour?

Over the past few months, I’ve been speaking to many pilots. They are telling me that trying to land a plane while you have a laser in your eyes is not only incredibly dangerous, it causes temporary headaches and blindness, causing hundreds of passengers’ lives to be at risk, putting themselves, their crew, and every passenger sitting behind them at risk.

Even air traffic controllers are now becoming common targets. You only need to look a few kilometres from here, in Paul Eagle’s electorate, at the new Wellington aircraft control tower. The same day—the very same day—it opened, some idiot in a nearby car park thought it was a good idea, have a bit of fun, to point a laser in that air traffic control tower, in the eyes of the controllers who have one of the most important and dangerous jobs in the world, safely bringing planes into land at Wellington Airport. This is one of the most complicated roles in the world.

Pilots, air traffic controllers, police, and many other New Zealanders are continually asking for harsher penalties. I also understand that the current Government, even though they are aware of the increasing incidences and cases occurring, have also been told that New Zealand is lagging behind nearly every other single country worldwide. They still feel this doesn’t need to be addressed.

No one in this country should feel unsafe in their workplace, including those in aviation who hold the safety of hundreds of people’s lives in their hands at any one time. Those in the emergency services who provide a critical lifesaving service are victims of high-powered lasers; for example, fighting fires in Wānaka the previous year a helicopter was brought down from the sky. It had to land because some idiot down below was pointing a high-powered laser into the eyes of that helicopter operator. The Eagle helicopter has been targeted while fighting crime from the air. Why are we not sending the message to deter these offenders from continuing with these idiotic behaviours and showing these offenders the full strength of the law? We need to deter these dangerous acts.

What is incredibly disappointing, though, is the Minister of Transport isn’t willing to put the safety of people before politics and support my bill. The Government’s soft approach on crime, on these criminals, is endangering the lives of Kiwis, and in some cases the emergency services in New Zealand. [Interruption] I just want to acknowledge Darroch Ball over there who has a bill in the box around first responders. I hope that he takes a common sense approach and supports this bill. I look forward to that.

Safety should be the paramount focus of all these ongoing issues, and that’s why we’re voted into Parliament. We are voted here to protect our people, to protect our citizens, keep them safe, especially when we’re talking about heroes like the police helicopter operators, or the rescue helicopters, or even the pilots who fly hundreds of flights daily across New Zealand. The rescue helicopters, they put their own lives at risk going up into the sky to get hundreds of Kiwis to safety every year from point A to point B in their time of need.

With the continuing increase of cases year on year, it is only a matter of time before a serious accident occurs. I ask this House tonight, are we willing to take that risk when we have the power now to do something about this, to send a strong message, and deter these criminals that do this? We need to do more to protect our pilots and passengers, who should all feel safe in aircraft across New Zealand.

The New Zealand Air Line Pilots’ Association supports my bill, which have said that it would be a step in the right direction of protecting our pilots and our passengers. You’ll also be aware, ultimately, that offenders will give power, like other countries have, to those who have requested complete prohibition. I think that’s a bridge too far in this House tonight. But we have the power today to do something to deter these incredibly dangerous acts.

We need to support our pilots, our air traffic controllers, our emergency staff, and our law enforcement agencies to do what they need to do, to continue to transport, to save, and to protect New Zealanders. We need to do all we can to ensure they are operating in a safe work environment. Those offenders who continue to put lives at risk through pointing high-powered lasers at aircrafts have to be dealt with, and understand those circumstances. My high-power lasers offenders bill will do this by not only deterring those offenders but also by raising awareness about an issue which poses a great risk to pilots and passengers.

DEPUTY SPEAKER: The question is that the motion be agreed to. And I just remind members that they should not be reading speeches. I didn’t interrupt the member, but really its members’ day, these are their bills, and they should be able to deliver a 10-minute speech on their bill without actually reading it.

GREG O’CONNOR (Labour—Ōhāriu): Thank you, Madam Speaker. Firstly, let me congratulate the member on having this bill drawn. Many people can spend time in this House without ever having a bill drawn, and I’m aware that it’s the second time he’s been so lucky. It’s probably unfortunate that the bill he’s had drawn is one that really, again, is something that this House could probably spend a lot of its time much better on. Oh, that life could be so simple, that we simply would solve a problem by doubling a sentence. Life just doesn’t really work like that.

Firstly, I think it’s probably quite important, because those that were listening to that speech may have thought, “Well, this is really, really serious.” In fact, the comment was made, “They’re getting away with murder.” Well, I think that, probably to say the least, would be overstating things somewhat. But, again, the member is building a case for his bill, so perhaps it is understandable.

But perhaps for the sake of those who are listening tonight, you would ask, “Why don’t we just ban these things if they’re so bad? What are they here for? Why are they in the country anyway?”. Well, they do actually have quite a legitimate use. There’s a range of things that these lasers, high-powered lasers, are actually bought for and are legitimate. Like so many of the things we have in our world in the hands of the sensible, the law abiding, the sober, these things are actually perfectly benign tools. But, of course, once you start regulating, once you start putting too many restrictions on them, you’ll be depriving many of those very same people I’ve discussed of the pleasure, the need, or the advantages of these things.

For example, one of the primary uses or one of the, I suppose, recreational uses is hunting. Now, for those of us of my era, who grew up with .303 rifles, who trod the bush of the West Coast, we even looked down our nose at those that actually had telescopic sights. A real bloke, in my day, was someone who could bring down a deer at a thousand yards on a dark night, shot from the hip, or that was how the subsequent tale in the local hostelry may have had it. I may be exaggerating things just a little, but certainly you’ll get the idea that in the world I grew up in real blokes didn’t use such tools.

However, the world has moved on, and you’ll understand that there are those for whom time is a little more precious, that when you do go hunting, you get a hunting block, you may not have the time that people did to spend weeks hunting down the best stag, hunting down nice back steaks to take and to share on a—it wouldn’t have been a barbecue because, again, in our day, Madam Speaker—

DEPUTY SPEAKER: Don’t include me in this.

GREG O’CONNOR: —barbecues—“our”, did I say? I wasn’t looking at you at the time, Madam Speaker; I was looking around the House, perhaps further down the back I might get someone nearer to our time. But, anyway, barbecues were, again, somewhat of a latter—they were seen as something for people who today might be wearing lycra; in those days it would have been the very people who were in those hunting.

As you’ll know I like to contextualise—some of the best work that I do in this House. But I’m going back to hunting and the use of lasers for hunting, just to remind you as to how we got to the point that we have right now. So these lasers now are attached to these magazines so that when the game—the whatever it is—that the person is recreationally in our bush for, doing their bit, I might say, for ecology, bearing in mind that we are a country that the more things we shoot in our bush that don’t have feathers, we are doing our bit for ecology. So, people do use these weapons, although in another time they may perhaps not have been quite as proudly talking about these things. But, anyway, coming back to the legitimate use of these—

DEPUTY SPEAKER: That would be good—that would be good.

GREG O’CONNOR: —very tools for which we are now spending our time in this House on members’ night. So that is just pointing out that this is something that there is a legitimate use for. Next time anyone who is enjoying a piece of back steak from the backblocks of the Tararuas or the Paparoa on the West Coast, they will know there’s a very good likelihood that one of these very things has been used for that purpose.

Moving on, there are other uses, too: for finding faults with fibre-optic cables. Anyone driving around Wellington at the moment will see that there is actually quite a large number of roadworks. The need to dig up under streets is minimised by the use of these lasers. So, again, what I’m talking about is the legitimate use. As I said, if we’re going to talk about why—

DEPUTY SPEAKER: I know that’s very interesting, but the bill isn’t actually—

GREG O’CONNOR: Well, no, no, Madam Speaker—

DEPUTY SPEAKER: —about the use of them for anything other than pointing in pilots’ eyes. So could we come back to that.

GREG O’CONNOR: Yes, but, again, Madam Speaker, it’s important to understand that without defining—I know, Madam Speaker, you would have been a debater in your day—what it is we’re actually using here I think is important.

But I do take the time; it is perhaps time to move on to perhaps the other—

DEPUTY SPEAKER: To the bill—to the bill before us.

GREG O’CONNOR: —parts of the bill. Just, again, we are talking about the definition of this high-powered pointer. It’s a device that in the director-general’s opinion is the kind commonly known as that laser pointer. If one looks at clause 9 of the bill, you will see that is in there.

Also, another part of the definition is that it is “battery operated”. That’s an important part—the “battery operated” part—and what does make this high-powered laser more sinister is that, of course, it makes it highly mobile, which, again, is why it becomes the tool of the sort of criminals who will actually hang around those places.

Again, I think it’s important to note that those who often talk about these lasers, they think that it’s got to hit the eye of the victim; it doesn’t. If one of these lasers is actually shone into a cockpit, the whole of the cockpit actually flares up. It doesn’t have to be aimed; they actually can be quite damaging.

So it is legitimate that we have the current existing legal regime around these lasers. But, of course, what this member’s bill seeks to do quite simply is just double the penalties. In doing that we should discuss whether penalties are actually the legitimate tool to prevent crime. Any criminologist will tell you that, actually, the best crime-prevention tool is a belief that you will get caught. That’s why when the police conduct—and you, Madam Speaker, as a previous police Minister will know the—

DEPUTY SPEAKER: Don’t bring me into it.

GREG O’CONNOR: —attention that goes on road policing: making people understand and believe that they’ll be caught is as an effective tool.

So anything that we do do, if we’re going to take this—and it is a serious issue, I do acknowledge that this is, and I would never belittle this on behalf of particularly airline pilots, those who are victims. But we owe it to those people that are victims, we owe it to airline pilots, to be a little bit more serious about this than merely to say that we’re going to actually double the penalty.

What we do have to do is actually ensure that these people who have nothing better to do that actually go and use these high-powered lasers against aircraft, against pilots, actually believe they’re going to get caught. That’s actually where we could be focusing our areas, ensuring that we get better powers to ensure that we can actually catch these people.

So, again, I go back to this idea of merely thinking that by doubling a penalty, all of a sudden we can leave this House tonight, or when this bill does wend its way through the process, and all of a sudden we’ve solved a problem. The problem there is that we will ignore some other tools that are absolutely essential for those who are potentially thinking of doing this extremely dangerous act. And in giving the protection to the pilots that pilots do need, aviators do need, and, as we heard, those who are in air traffic control do need, we need to ensure that we don’t just focus on doubling a penalty, and that we actually look at what we can do to ensure that those offenders that do this will believe that they’re going to get caught, and that will be the safest thing that we can do. Thank you. In doing that, I oppose this bill.

Hon Dr NICK SMITH (National—Nelson): The contribution that we just heard from Greg O’Connor may well have been started with the words “We don’t take aviation safety seriously.” because every single day tens of thousands of New Zealanders get on an aircraft and put their life in the hands of the skilled pilot and flight crew to keep them safe. It’s actually been an incredible story in the way in which aviation safety has improved over the last 30 years and I just did not get any sense from the Government as to how little things in the aviation sector can make a massive difference to life.

I’d just ask members opposite who have said they’re going to oppose this bill: do they really believe that the current law, where a person with a laser beam can bring down an aircraft with many hundreds of people—that the penalties that currently exist on our law books are fair and appropriate? I congratulate my colleague Hamish Walker for having the audacity and the good sense to introduce this bill to the House and make plain on the law books of New Zealand that messing around with the safety of aircraft carrying hundreds of people is totally inappropriate and deserves the sorts of penalties that are proposed in this bill.

I was surprised to read of the number of incidents that have involved pilots suffering from attacks from such laser beams. They number in their thousands internationally. There are reports of pilots being blinded for 45 minutes as a consequence of a laser pointer. What member of Parliament in this House wants to be in an aircraft where the pilot has been blinded for 45 minutes? That is playing with death and the Parliament needs to treat it with that sort of seriousness, as does my parliamentary colleague.

It’s also interesting to note what the other jurisdictions do. If we look at Australia, if we look at the United States, if we look at Canada, if we look at the UK—every one of those jurisdictions has tougher penalties because of this new risk. And yet we have a Government over there that says, “Oh, we know better. We think this is a minor safety issue.” This week, I was flying from Nelson to Wellington. I was invited very politely by the captain and co-pilot to sit up front in the aircraft, and that was a privilege to do so. You get the opportunity to talk to them about the issues facing our pilots in New Zealand and while the Government members may think this is a bit of a joke, actually, the pilots who sit at the front of our aircraft every single day and take the safety of the travelling public so seriously do want this bill.

I also want to reflect on the broader view where this Government’s out of touch—and that is that this is a Government that is fundamentally soft on crime.

Darroch Ball: Oh, get lost.

Hon Dr NICK SMITH: They are soft on crime and are soft on gangs and I invite the member that’s interjected to look at what’s going on in places like Hawke’s Bay and look at what’s going on in Tauranga. Even in my own community, I’m seeing the impacts of the Government’s policy of not holding people to account for when they do bad or dumb stuff. I just say it’s flawed. I say the view that you heard from Greg O’Connor represents Government policy, and that is, “Actually, we don’t think that fines or penalties on people work.” We’ve even got this Government saying that people that commit offences have got to have the freedom to vote, and I’m going to debate a bill on that.

Well, I say to the Labour Government and their coalition parties they are out of touch with New Zealanders. They want a Government that will hold people to account for doing reckless, stupid things, and pointing a laser at an aircraft is a stupid, reckless thing which this Parliament should take seriously and should impose the penalties that are appropriate.

Darroch Ball: You don’t know what this bill is about, do you? You’re not even talking about the bill.

Hon Dr NICK SMITH: I say to the member from New Zealand First I’m absolutely talking about the bill. It is about the penalties for people—

DEPUTY SPEAKER: The member’s time has expired.

GINNY ANDERSEN (Labour): Thank you very much, Madam Speaker, for the opportunity to speak on the High-power Laser Pointer Offences and Penalties Bill. I think it’s important that we spell out exactly what this bill proposes to do. So the bill amends existing offence provisions and increases the penalties for use and possession of high-powered lasers and the bill doubles the maximum penalties to six months’ imprisonment or a fine of $4,000. It also amends clause 9 to make that any such offences committed with high-powered light lasers are punishable by up to 14 years’ imprisonment—14 years.

What I would like to point to is that when the National Party was last in Government and I was a diligent worker for police, I remember well when the introduction of legislation happened to introduce new penalties and new offences for the use of high-powered lasers. And since 2014, since that legislation has been introduced, the problem has got worse—the problem has got worse. Instances of misuse have escalated dramatically since that legislation was introduced. The penalties as they stand were not applied despite a record number of incidents. So increasing the penalties for possession is highly unlikely to have an impact, which is the desired one from those opposite. And so the rationale here is that if something’s not working, let’s do it more—and some analogies can probably be drawn with the leadership, but I won’t go there.

The third one in terms of increasing penalties—let’s look at the psychology of increasing a penalty. Do you think the person sitting in the car at Wellington Airport who has the high-powered laser beam pointing at the air traffic control has got Radio New Zealand on with The House, listening to that—that law was changed and the penalties have doubled—and suddenly flicks it off and puts it away? They don’t; they do not know. So that is why increasing penalties blindly has zero impact upon offending rates or the outcome and that is why we oppose this bill.

So let’s have a look at the other issue that came up when I was working at police. The other issue that comes up when you are just increasing penalties is it is actually pretty tricky to catch someone pointing a laser. The ability to intercept someone and find where that beam is coming from is a tricky job, and wouldn’t you be far better off targeting illegal online sales? Wouldn’t that be a better point to intercept them? Because, if we’ve already introduced—as we have done—the Customs Import Prohibition (High-power Laser Pointers) Order in 2013, which states that hand-held high-power laser pointers are prohibited to import without a consent from the Ministry of Health, shouldn’t we be looking at how people are getting their hands on them without having that permit?

I would argue that we should be taking a closer look at online sales, and that would be a far more effective tool to try and curb some of the dangerous incidents that are happening instead of trying to threaten people with increased penalties and 14 years in prison. So I think that this has good intent—this bill—the idea of making people safer. The idea of giving pilots and air traffic control staff the confidence that their wellbeing and safety are looked after is a good idea, but the execution of this bill, the idea of how it’s going to be carried out by threatening people with 14 years in prison, is doomed to fail, because it has failed since the initial legislation was introduced under the National Government previously.

So, looking at that, that is the case for why we believe that this is not a good bill for addressing this problem—that there needs to be a far more thorough exploration of what this problem is—and if we look back into the history of where this comes from, I can name another bill that was exactly the same, and that was car crushing. It’s the idea of coming to the end of a solution and scaring people with an outcome without actually analysing what the problem was. How many cars did we crush in New Zealand under that legislation? I think we did one or two, and the time it took the Parliament to pass the legislation and to implement a bill that had zero impact on the problem was a real waste of time and effort and energy. If we’re serious about turning things around, we need to look at how people are getting their hands on these, not just standing over them and threatening them with imprisonment. Thank you, Madam Speaker.

DEPUTY SPEAKER: I call Darroch Ball and introduce him to Hamish Walker!

DARROCH BALL (NZ First): That’s right—Hamish Walker. It’s getting increasingly frustrating. Every time I stand up and speak in this House, it’s quite often that I say that the National Party haven’t done the research, but what’s quite disappointing about this one is that the member himself, who is the author of this bill, quite frankly hasn’t done any research, and neither has Nick Smith. Nick Smith stood up there and he said that this Government doesn’t want to have any legislation or laws against people shining lights into aircraft and helicopters—there already is. There already is, and this bill isn’t addressing that. This bill isn’t addressing that.

Hon Tim Macindoe: It just increases the penalties—read the bill.

DARROCH BALL: Now Mr Macindoe is getting on to the bandwagon. He doesn’t know what he’s talking about. This bill, if they look at the general policy statement right at the start, is talking about the possession—the possession of the lasers—not about the fact of pointing a laser into the aeroplane, or the aircraft, or the helicopter. They’ve already got provisions for that in the Crimes Act—it’s called the Crimes Act 1961, section 270.

Now, the reason why I know that is that I did a little bit of research and people have been charged under that section of the Crimes Act for shining lasers into aeroplanes and into helicopters. They already do—they already do. I’ve got examples written down here. Someone laser-struck four aircraft and was charged with four counts of endangering transport under the Crimes Act 2012—they already were charged. Now, what’s the penalty for that? What’s the maximum penalty for that, Mr Walker? Already 14 years in prison. Now we’ve got people standing up here from the Opposition—call themselves members of Parliament—they don’t even know what they’re talking about when they stand up. Another example: two counts of reckless disregard under endangering transport in the section in 2016. It’s unbelievable that they don’t even know that when they stand up.

This bill is doing nothing but increasing penalties for the possession of lasers. What Mr Walker failed to do was mention that, although there were 717 laser strikes on individual aircrafts or helicopters, or the like, and 228 last year—228 different examples last year. Now he wants to increase the penalties under possession. How many people were prosecuted for possession of the laser from the 228 incidents? How many, Mr Doocey—guess? Zero—zero people were prosecuted for the possession of lasers last year, and only four since 2015. This individual wants to stand up here and say that this side of the House is soft on crime and that we’re not serious with it because we don’t want to see an increase in penalties, but no one’s been prosecuted with it yet—no one has been prosecuted with it yet—four instances since 2015. And how many have had the maximum penalty, Mr Walker—how many have had the maximum penalty? Zero.

So we’ve got an individual who, by the standards of the backbench of the National Party, is quite a genius, and he stands up and all he does is look into the Summary Offences Act 1981, goes straight to the possession of high-power laser pointers, goes to the sentences, sees $2,000—“I know what, let’s double it”, goes to the imprisonment, three months in prison—“I know what, let’s double it”. And he thinks that that is going to go anywhere near solving any of the problems with the 717 incidents since 2015.

Not only that, let’s get one thing straight: in 2014, when this original piece of legislation was introduced by the National Party—by the National Party—it clearly has done nothing to touch the sides of stopping. They had not one, not two, but three years, at least, to have a look at the lack of effectiveness of this piece of legislation. But really, as Mr O’Connor actually quite rightly pointed out in his speech, this has got nothing really to do with the legislation. It’s got to do with the enforcement. If we’ve got 717 incidents and zero prosecutions last year, it has nothing to do with the legislation and it has absolutely nothing to do with the level of punishment that can be meted out by the way, because there were none meted out last year at all.

I do want to say that it’s no secret, and it shouldn’t be a surprise to anybody, that this entire House—whether it be that side or this side—find the issue of laser pointing into the aircraft a very dangerous one, a very serious one, and we do need to do something about it. This bill isn’t doing it, because it’s not addressing the right part of the issue. We do not support this bill.

Hon MARK MITCHELL (National—Rodney): Thank you, Madam Speaker. It’s a pleasure to stand and take a call on this, the High-power Laser Pointer Offences and Penalties Bill. Can I acknowledge the sponsor of the bill, Hamish Walker, who put this bill into the ballot, and it has been picked from the ballot. He is responding—and the last caller highlighted the fact that there’s been 117 cases where the legislation that the National Party introduced has actually been used in terms of action taken—[Interruption] Well, if the incidents have been recorded, then obviously there’s an issue around the use of high-powered lasers. The issue exists there, it sits there.

In response to the last speaker, Darroch Ball, he’s very upset by the fact that this Government’s—the narrative now is up, and the perception amongst Kiwis is that it’s soft on crime. It is soft on crime. Greg O’Connor raised the point that this bill’s been brought to the House and it’s a waste of the House’s time. Let me tell you what the waste of the House’s time is: the Ombudsman’s bill, the bill that this Government brought to this House that affects a grand total of three people in New Zealand, right? And I’d put to the Government this: if you were to survey every Kiwi that uses and has access to a commercial carrier, or is a regular flyer, and you ask them and you said to them, “What would you rather see: tougher penalties around someone that may use a high-powered laser to interfere or interrupt the functions of a pilot of your aircraft or the Ombudsman’s bill?”, I can tell you which one they’ll be picking. It won’t be the Ombudsman’s bill, right? So you’re on the wrong side of the argument, trust me. And let me raise another point—[Interruption] He’s laughing. He’s laughing about it, and I’m actually shocked that the Government has not—

DEPUTY SPEAKER: Order! Order! You’ve had your five minutes.

Hon MARK MITCHELL: —chosen to support this bill, because it would have been a chance for them to do something positive and send a positive message to people that may be thinking about interfering with commercial flights or our police Eagle helicopter. It might have been a chance for the Government to say, “Yes, we think that’s a good idea to signal and get behind Hamish Walker.” and to say, “We’re taking this seriously. You are going to face a stiff penalty or sentence if you engage in this. You could face up to six months in jail.” I actually think that putting a commercial airline at risk with 200 to 300 passengers on it is worth six months in jail. I do believe that. I think that if someone is caught doing that, it’s worth six months in jail, if they’re caught doing that.

Darroch Ball: It’s worth 14 years already.

DEPUTY SPEAKER: Can I say to Darroch Ball—

Darroch Ball: It’s 14 years already.

DEPUTY SPEAKER: Darroch Ball, I’m speaking to you. Don’t ignore me. You’ve had your five minutes. Let the guy have a go.

Darroch Ball: Well, clearly he’s not listening, Madam Speaker.

DEPUTY SPEAKER: Well, he doesn’t have to listen to you; he has the floor.

Hon MARK MITCHELL: Thank you, Madam Speaker. And you’re right, I’m not listening to him. I gave up on that a long time ago.

The other point that I wanted to raise is the police Eagle. I just wanted to use a very quick example. When I was a young police officer in Auckland Central, back in 1990 probably, I was called to a job where a woman had been calling for assistance in the central city. I’d arrived there with a couple of my colleagues. We were looking for her. We were searching yards that were unlit, and we were having no success at all in actually finding her. In fact, we were about to give up because we thought it might have been a false call, when all of a sudden the Eagle helicopter appeared with Lou Grant. And can I just acknowledge and remember Lou Grant and Alastair Sampson and Ross Harvey, who, very sadly, we lost serving in that Eagle helicopter.

I can’t remember what the candle power was—it’s about 20,000, 30,000 candlelight power. They just lit up this enclosed yard and the offender immediately became obvious behind a skip bin with this girl who, at the time, he was trying to sexually assault. I can tell you right now, even back then, the Eagle guys—and I want to acknowledge our Eagle staff today that do an outstanding job.

In fact, the Eagle in Christchurch was subjected to a high-powered laser just in the last couple of weeks. They said that interference from the ground was just as risky to them in the work that they’re doing as any type of interference from the air. So this is a serious issue. It’s not something to be laughed at. It’s not something to be scoffed at. It’s not something to be trivialised. It’s a serious issue that could end in tragedy. I want to again acknowledge Hamish Walker and the fact that he’s brought a serious bill to this House to say that we are going to react, as the Speaker said, to a rising number of these incidents, and we’re going to send a very clear message that we’re going to increase the penalty around it. The Government needs to do a little bit of soul searching and come back and decide whether or not they should be supporting this bill. Thank you very much, Madam Speaker.

Hon JAMES SHAW (Minister for Climate Change): Thank you, Madam Speaker. First of all, I just wanted to say congratulations to Hamish Walker on having this bill pulled. I know that the odds are against it and it’s always pretty good, particularly if you’re a first-term MP, to get a member’s bill drawn from the ballot. Of course, it is also quite disappointing when it gets voted down on first reading, which is probably what’s about to happen.

This is an appropriate topic for a member’s bill. It’s got a very tight focus. It deals with a real problem, and I do think it is a real problem. I agree with Mark Mitchell that it is serious and it needs to be taken seriously. It’s a case of emerging technology that’s being used and abused and is putting people’s lives at risk.

I have a personal story of this, actually, not in an aeroplane but just at home. Someone was shining one of these lasers through the windows of my house late one night, and the risk, of course, was that it would blind either me or my wife, who were both up in the house at that moment. Of course, we could sort of identify roughly the position of where the person was who was shining the laser into the house, and I sort of went out on to the deck and the person disappeared.

Here’s the thing. If that person had known that the penalty was double, would they have still done it? My answer would be “Well, yes.” That person who was shining that laser and didn’t actually know what the existing penalty was wouldn’t have known that doubling would have made any difference.

Hon Mark Mitchell: How do you know that, James?

Hon JAMES SHAW: So when you have—well, I didn’t get a chance to ask him, and that speaks to the question around enforceability, Mr Mitchell, but I’ll come back to the question around enforceability. The issue with this bill is that every time you do something like this, you have to ask yourself the question: if we do this, will it fix the problem? And I’m afraid that this bill fails on that test. Just doubling the penalties is not going to stop people from shining lasers up at pilots. Getting rid of the lasers, that would stop people from shining them into aeroplanes.

The other issue, of course, is the issue of enforceability, which is we can have these reported incidents when they’re reported from an aeroplane, but you’re not actually going to get a sense of whether or not you can actually catch that person at all. And the fact that there have been 117 incidents reported but no enforcement of the existing law suggests that merely doubling the rates wouldn’t improve that.

Debate interrupted.

Sitting suspended from 10 p.m. to 9 a.m. (Thursday)

WEDNESDAY, 11 MARCH 2020

(continued on Thursday, 12 March 2020)

Bills

Taxation (KiwiSaver, Student Loans, and Remedial Matters) Bill

In Committee

Part 1 Amendments to KiwiSaver Act 2006

Rt Hon DAVID CARTER (National): I assume this is the part that is relevant to the excellent submission we received from—

Hon Chris Hipkins: I’m sure he’s read it.

Rt Hon DAVID CARTER: Well, I sat on the select committee in fact, so I’m doing more work than the Minister’s doing, but that’s not a challenge—but that’s not a challenge.

Now, returning to Part 1 of the Taxation (KiwiSaver, Student Loans, and Remedial Matters) Bill, the issue I want to discuss is the excellent submission we had at the Finance and Expenditure Committee from Tim Fairhall, who appeared before the select committee. He is a remarkable young New Zealander, a Down syndrome person, who has worked full time, five days a week and has taken a full part in New Zealand society. But he acknowledges that he will unlikely live to 65 years of age. He has a brother living, I think, in Italy, from memory, his best friend lives in Canada, and he wants to use his KiwiSaver for the opportunity to go and travel in his latter years. Certainly that is a plan that he intends to undertake before he is 65 years of age.

So I know that the Minister has accepted an amendment to KiwiSaver to allow people with illnesses such as this—or with conditions, I should say, such as this—to have early withdrawal of KiwiSaver funds for a person that doesn’t expect to live to 65. My question to the Minister is quite a serious one: how will he now monitor applications? How will applications be received? Who will be the decision maker? Because whilst we’ve moved, and the Parliament I think is fully in agreement with cases such as Tim Fairhall, we do not want to see this become a loophole by which people can choose to withdraw from KiwiSaver arguing, factually incorrectly, that they may not live till 65 years of age. So my question is quite a serious one. I want to know what work is being done now around the approval process. I want to know who actually makes the decision. How does a person who is in the situation similar to Mr Fairhall—how does he or she make an application? What supporting documentation would they be expected to present to the decision maker, who the Minister is going to tell us about shortly, so that this becomes something legitimately used for people such as Mr Fairhall and not a loophole for people to try and extract themselves early from KiwiSaver for some nefarious-type reasons that they might have.

I won’t take further time in this committee stage, but I look forward to the Minister rising to answer those quite genuine questions I’ve raised.

ANDREW BAYLY (National—Hunua): Fantastic, and lovely to be here this morning, and nice to see the House pepper-potted with a whole lot of Ministers at this early hour of the day. It’s very good, contributing strongly to the economy, obviously.

Now, I wanted to deal with this issue around clause 14 of the bill. This is the amendment around the application date for KiwiSaver members. I think you will be aware that clause 14 would allow KiwiSaver members to change their contribution rate by giving notice to their scheme provider or to IRD. Currently, members can only make changes through the employer. As you’re aware, one of the things we want to do is we want to make sure that people have the opportunity to contribute as much as possible to their KiwiSaver over time. We’ve had these artificial restrictions around the different rates that they can contribute at, we have the minimum of 3 percent, and then we have these jumps up to 8 percent. One of the big changes that we made was to actually change the rates so that it is much more permissive in terms of 3, 4, 6, 8 percent and up to 10 percent of gross salaries. The big issue that we were trying to address in the Finance and Expenditure Committee is this issue around how you make sure that you can change your rate easily. Hopefully, in many cases, that means a move upwards in terms of the rate, so a higher contribution. So when people get to their retirement, they’ve got more banked in their KiwiSaver.

I think the big issue here was the issue around the process that KiwiSaver providers had to go through. At the moment, it was very, very restrictive because they could only do it through an employer. That meant that there were times when the employer was in a situation, or their administration might not have been so good, where there was still the lag time that went back to the IRD. In fact, I’ve met many people who have been in a similar situation. I’m going to talk particularly about a lady called Georgina Burgess, who actually had a system where she invested in a KiwiSaver scheme, she wanted to change her rate, and she had a great deal of difficulty actually trying to find out what a rate was. But the process to go through her employer was one that made it very, very difficult for her to actually achieve it, and it actually ended up with her changing her KiwiSaver provider. It was actually only at that point, even after making inquiries of her KiwiSaver provider, that she could determine the rate that she was on. I think this is a really important aspect of the bill. I think the flexibility that this brings in is a very, very important part. I think, in terms of future-proofing the system and the KiwiSaver provisions going forward, it’s a very, very substantial part to this bill.

So in terms of the specific requirements, the change would require IRD to pass on a member’s request to change their contribution rate to the employer. So if a person goes to the IRD directly, then the IRD has this obligation back to the employer, because, of course, that’s where all the deductions take place, at source.

There is this issue around the employer needing to action it. That is a question that we need to make sure that there is adequate provision for in the IRD—that the system in place does actually mean that if someone has gone directly to the IRD, that the employer does make that change. I think that’s an important aspect, and it’d be quite interesting to get the Minister’s view on that, in terms of making sure that there is certainty around those instructions being passed on. I do note the change doesn’t take place until April 2022, or an earlier date, but that is crucial if we are to move to this more flexible process—that in fact we have the institutional arrangement in place to make sure those people’s wishes, the KiwiSaver depositors’ wishes, are actually carried through and implemented appropriately.

IAN McKELVIE (National—Rangitīkei): Thank you, Madam Chair. I wanted to just follow on from the contribution of the Rt Hon David Carter, because I absolutely understand the need to try and, I guess, accommodate the likes of Tim Fairhall, his requirements, and clause 12B of the bill does that. But the really interesting challenge with this, and it was mentioned by David Carter in his contribution, is exactly how you determine that. In my time in this unusual business, I’ve had people come into my office who have, in fact, cashed their KiwiSaver in for the very reason that this clause is being inserted. They have gone off and done their thing, with a doctor’s certificate telling them they’re not going to live any longer, and five years later they’re still around and they’ve got no cash. It’s a very real issue. It happens with life insurance as well. People take their life insurance out, go off and spend it. I suppose it gets back to David Seymour’s euthanasia bill, to some extent. But it is a very interesting challenge, because you take your life savings, off you go, and then, lo and behold, you’re still around. That’s a very real challenge for this as well.

I spent some years as the chairman of Special Olympics, which has a whole lot of members—in fact, thousands and thousands of members—in exactly the same situation as Tim Fairhall, who have a potentially life-shortening condition, who have a job, and who are working away like every other New Zealander and contributing to KiwiSaver but have the opportunity to withdraw it early for this reason. I think it’s going to be very challenging to establish that.

It’s equally as challenging—and in the Special Olympics case, it’s very challenging—to understand the degree of, for example, in their case, intellectual disability: which qualifies as a special Olympian and which doesn’t? This bill raises this very same issue, and you can see why for years the Inland Revenue or the taxation department have grappled with this situation, because it’s a very difficult situation to overcome. I, like David Carter, will be very interested to see what the Minister’s view of this is and how it might be managed, because it will be critical. It will be tested for all sorts of reasons, and it is a very real challenge.

I mean, getting on to KiwiSaver itself, I think that KiwiSaver is a great asset to New Zealand and to those people who are part of it, and I urge all New Zealanders to be part of it, but, of course, it is, in challenging financial times, the first thing people tend to look to to get themselves out of financial difficulty or to make their lives more comfortable. Through our offices, we get numerous, I guess, requests—some of them quite angry—to withdraw their KiwiSaver or access their KiwiSaver to keep themselves going. So I think it is important that we have rules around it, although for those of my age who have got a KiwiSaver sitting around now and you’re in the high-risk zone, she’s not too good. I think you probably would’ve dropped 20 percent in the last few weeks, so I’m hoping I don’t get booted out—

Rt Hon David Carter: Are you watching it regularly?

IAN McKELVIE: No, I’m not, and I hope I don’t get booted out of here in September, because I might need the cash! But it would be tricky.

Actually, just on that point, it’s another interesting point because in my earlier days, I did chair a superannuation fund. The superannuation rules in New Zealand have changed so often. I know this is just slightly off the point, but it’s very relevant to the point—very relevant to the point. They had a terminal date, so when you left the superannuation fund, you took your cash. Of course, right now, you would not be wanting to take your cash out of a superannuation fund, were you part of it, and so KiwiSaver has got to have that flexibility as you get out the other end of it as well. So there’s a whole lot of, I guess, very interesting situations that arise as a result of—I was going to say “fiddling”, but I shouldn’t say that—tinkering with this kind of legislation, because it is a tricky thing to do. But I do accept that this is a very good effort to achieve a result for Tim Fairhall and all of his friends.

I don’t want to go on any longer on the issue, but it is a tricky issue and I congratulate the Parliament on it if we can get this through in one piece and make it work. I think it’s a well-worthwhile piece that’s added to this bill. Thank you, Madam Chair.

Hon STUART NASH (Minister of Revenue): Thank you very much, Madam Chair. Look, there’s a couple of questions that came up. I’m happy to answer them, but I’m only really keen to answer each of the issues only once. I don’t want to waste the Committee’s time, and I hope the members on the other side won’t as well.

First of all, Mr McKelvie, I think that of any member in this House, you’re probably going to be OK when you retire. You know, I don’t want to cast aspersions, but you’re going to be OK.

First and foremost, let’s acknowledge that KiwiSaver was set up as a retirement scheme for New Zealanders. There is no doubt about it, and that’s how the vast majority of New Zealanders do use their KiwiSaver. Let’s also acknowledge, though, that there are a couple of situations under which New Zealanders are able to access their KiwiSaver funds before the age of 65. One of those is extreme hardship, and they’ve got to be able to prove that before they can withdraw their KiwiSaver funds, and the burden of proof is quite significant and I think it’s quite robust.

Because of Tim Fairhall’s case, this has come before Parliament, and we have agreed with this case. Again, I think that the system for approving someone to withdraw their KiwiSaver funds because they can prove they’re not going to reach the age of 65 is very robust as well. The proposed legislation would create a list of life-shortening conditions, and then it would be up to the KiwiSaver member to provide medical proof that they have those conditions.

I take Mr McKelvie’s point that it may well be that someone does present with a life-shortening condition and then they get better. I’m also well aware of Mr McKelvie’s point that life insurance will also pay out if someone has one of these life-shortening conditions—for example, terminal cancer—and if they then go on to have a full life, fantastic and that is awesome. I suspect that that would be a very small minority of cases, but I really don’t think that this is a clause in KiwiSaver legislation that people will seek to game.

I really do think that the conditions we’ve placed around this—i.e., medical proof that you have one of these life-shortening conditions—is, again, pretty hard to game or to use in a fraudulent manner. It would require, first of all, the person to have fraudulent intentions; second of all, for the medical profession to act in a fraudulent manner. Again, I just don’t think that that will be the case.

With regard to the Hon David Carter’s point around—sorry, the Hon Carter?

Rt Hon David Carter: Who do you apply to was my question as well.

Hon STUART NASH: Yeah, who do you apply to—this will be run through the Inland Revenue (IR). It’ll be run through the IR.

Mr Bayly, your point around KiwiSaver contributions, when they go up and down: as you’re probably well aware, sitting on the select committee and being right over Business Transformation—release four coming out in Easter of this year—that includes KiwiSaver. It is a massive, massive undertaking: $1.4 trillion worth of funds, I think, are being transferred from the old system to the new system, but as a result of that, the Inland Revenue is going to have a much greater oversight of the whole KiwiSaver scheme.

So what we are saying is you provide your information to Inland Revenue. They then go to the employer, and our recommendation is that in the next possible—or practical, I should say—pay round, the employer will enter that information and make the changes. So, for example, if you provide information to IR and your next pay day is tomorrow, then I don’t think it is practical to expect them to change the rate within 24 hours, but if the next pay day is in two weeks’ time, then I suspect that that is a practical time to have that change reflected in your payslip and in your KiwiSaver contribution.

One thing I would say is the level of data and oversight that Inland Revenue will have under Business Transformation is significantly greater than it has now, also keeping in mind, as also mentioned, that this doesn’t come in until 1 April 2022. Inland Revenue has plenty of time to work with employers to make sure that the processes for changing someone’s KiwiSaver contributions are robust and are done in a timely manner, and I expect any wrinkles will be ironed out well before 1 April 2022. I hope that answers both the members’ questions. Thank you.

ANDREW BAYLY (National—Hunua): One issue I wanted to just talk about was the student loan arrangements, particularly under clause 45B, amending section 72. They relate to custodial institutions as well. But this is the issue around student loan deductions from scheduler, election-day, and casual agricultural income, and also the exemption threshold for student loan repayments. This bill has quite a lot to do with student loan issues, actually, in terms of making sure that they are appropriately dealt with and are actually slightly more flexible—

Hon Stuart Nash: That’s Part 2, mate.

CHAIRPERSON (Hon Anne Tolley): Yeah. It’s actually in Part 2.

ANDREW BAYLY: Section 72?

Rt Hon David Carter: Yeah, Part 2.

ANDREW BAYLY: Oh, sorry. We’ll move on.

CHAIRPERSON (Hon Anne Tolley): I think there’s a shout in the whip’s fund, yes.

The question was put that the amendments set out on Supplementary Order Paper 453 in the name of the Hon Stuart Nash to Part 1 be agreed to.

Amendments agreed to.

Part 1 as amended agreed to.

Part 2 Amendments to Student Loan Scheme Act 2011

CHAIRPERSON (Hon Anne Tolley): That brings us to Part 2—that’s clauses 39 to 57 and Schedule 1.

ANDREW BAYLY (National—Hunua): Thank you. I was just ahead of the pack.

CHAIRPERSON (Hon Anne Tolley): You were.

ANDREW BAYLY: The amendments to the Student Loan Scheme Act, set out in Part 2, are very extensive, actually. I think the issue around this, as I said before, is really one of making sure that there’s adequate flexibility for students. There’s a balance here between making sure that students can and do participate in the KiwiSaver schemes and also making sure that the arrangements are fair and also, when they cease to be students and move on to a period where they’re full-time earning, that the appropriate arrangements are in place to ensure that that is appropriately done so they make their contributions and all their student loan repayments as part of that requirement.

Some of it is dealt with in Part 2. Some of it is dealt with later in further sections. But I think the important thing here is the issue around the minimum deduction, which has been reduced from $1,500 to $500. I think that part of it is quite an important little aspect in terms of the ability of students to be able to manage their own affairs. This relates to an issue around—originally, there was a $1,500 threshold. It was introduced to reflect the compliance costs associated with the requirement to file a return for student loan purposes. But part of this bill reduces that to $500.

Also in new section 62A, in clause 45, the commissioner may now notify employers when loan balances are close to zero. This is the other bit I was talking about in terms of making sure there’s a transitional arrangement for when students have paid off their student loan and are, obviously, moving on in terms of their life. Previously, under the arrangements we had, often the employer would keep making a deduction against the person’s income, and, in many cases, this resulted in an overpayment by the employer on behalf of the student to repay their student loan. What section 62A does in particular is make sure and create the provision under, hopefully, the new system that’s coming into place to operate in a way that they can tell the employer that it should not be making a further deduction—so, in effect, giving pre-notification of the amount outstanding in terms of the student loan, so we get to a point where the employer is making the correct deduction at the correct time and stops thereafter.

That is a very important part, and I think it’s one of stopping all the compliance costs. It also stops all the hassle of that person who may have overpaid to the IRD to have to go and seek a refund and all the difficulty associated with that. So I think that is very, very helpful.

Again, it would be quite useful to hear from the Minister in terms of the operation of that—how that’s going to be managed. I know we’ve got a big Business Transformation programme coming through and working its way through and it’s assumed that the technology will give us that sort of—but it would be actually quite nice to know further details about how we are going to ensure that that is going to be carried out in a timely manner, prior to the last payment, and what arrangements and just any other aspects to that, because I think it is a very important part, especially when you get in the number of students that this will apply to.

Rt Hon DAVID CARTER (National): I just want to take a brief call because I’m like the IRD and its old motto: “We’re here to help”. In clause 45, new section 62A, I think we may have a minor mistake, which we should have picked up on at the Finance and Expenditure Committee but which we haven’t. Let me try and point it out to the Minister of Revenue, and there may be a chance that if necessary, we can fix it at this committee stage.

For section 62A, the heading is “Commissioner may notify employers when loan balance close to zero”. First of all, I question why there’s a need for that. I would have thought it was necessary for the commissioner to not continue to accept contributions once the loan is in credit.

Then, further on, “(2) When [the] borrower’s consolidated loan balance … close to zero, the Commissioner may—(a) notify one or more borrowers … and (b) require the employer, [and the] employers, to reduce standard deductions” etc., so they don’t. Then, at 62A(3), “The Commissioner must give a copy … to the borrower.”—and we’ve removed the bit: if a valid address to the borrower is found.

My concern is what happens if you don’t know where the borrower is, and I presume that’s why we’ve removed the words “if a valid address to the borrower is found.”

And then further, at 62A(3A), it does not apply if “he or she has incorrect contact details for the borrower [and] cannot reasonably locate the borrower.” So I’m just confused as to what the obligations then are to the commissioner in regards to the borrower of the student loan and to the employer. So just a bit of clarification around that from the Minister would be helpful as to whether we’ve made a mistake with the “mays” and the “musts”—that’s, basically, my question.

Hon STUART NASH (Minister of Revenue): A couple of points—I don’t think we’ve made any mistakes at all. First and foremost, the student loan scheme has been around, I understand, since 1992. I think you’ll find that the vast majority of people who have student loans—to Mr Bayly’s point—but are also gainfully employed are part of KiwiSaver. They understand the rationale behind KiwiSaver and they’re contributing to KiwiSaver as well as meeting their loan repayment obligations as good Kiwis and someone who has signed a binding contract with the Government. So I don’t have any difficulty with this.

The second thing I will say is I would make a recommendation, if I may. Business Transformation and the process that it is going through to enable Inland Revenue (IR) to gather so much more information to better serve Kiwis is quite complex, but the overarching theme behind Business Transformation is data that IR can use to improve the integrity of the tax system but also provide a much better service to New Zealanders. I would make a recommendation—I know the chair of the Finance and Expenditure Committee (FEC) isn’t here—if you have any really technical issues with the whole Business Transformation project, I know the Commissioner of Inland Revenue is always welcome to appear before the FEC and answer a lot of those details, and I know that as each release comes close to fruition, she is more than welcome to come in and brief the select committee.

Rt Hon David Carter: And she has done, and she’s very good.

Hon STUART NASH: And she has done. I’m well aware that she has always replied or taken up any invitation that has been issued by the FEC.

In terms of the Rt Hon David Carter, you’ll note in the clause that you read out there it talks about “reasonably”—what the commissioner can reasonably be expected to do. Now, what we do know is that Kiwis move, and it is actually the borrower’s or the taxpayer’s obligation to provide and update their information to Inland Revenue. So it’s not Inland Revenue’s obligation to keep chasing up the borrower for current details. Why we have a reasonable test in this is because certainly when Kiwis—you know, they go from their student flat, they go back to wherever they’re heading to, and then they head overseas; and, as we know, many Kiwis, they go from flat to flat to flat. I don’t think that we would expect Inland Revenue to expend an inordinate amount of money or time trying to chase Kiwis that they can’t. But, as mentioned, it is actually the obligation of the borrower to make sure that their information is correct. That’s why we have a reasonable test there.

In terms of “may contact the employer”, again, I think you may well find that a lot of student loan borrowers, when they get close to the point of paying off their loan, are well aware of what their obligations are and how much they need to pay. In fact, I know a number who have held celebratory drinks as the last dollar goes into the Government to pay off their student loan. They may well contact Inland Revenue themselves just to make sure they’ve got the balance exactly right. So I suppose this is Inland Revenue again being proactive if they feel the need to be proactive in a situation where perhaps the borrower hasn’t been proactive themselves. So we don’t want to place an undue obligation or reach a point where there is undue duplication. That’s why you’ve got the “may” versus the “must”. But, again, I come back to that reasonable person test, I suppose: Inland Revenue will do all that they possibly can—and, I think, that we would expect of them—to ensure that the obligations of the borrower are met. But they’re not going to chase people to the ends of the earth if, in fact, that’s just a complete and utter waste of time. But I would go back to the point that it is up to the borrower’s obligation to provide Inland Revenue with the correct information. I hope that’s answered your questions.

The question was put that the amendment set out on Supplementary Order Paper 453 in the name of the Hon Stuart Nash to Part 2 be agreed to.

Amendment agreed to.

Part 2 as amended agreed to.

Part 3 Amendments to other enactments

CHAIRPERSON (Hon Anne Tolley): That brings us to Part 3, which is debate on clauses 58 to 148 and Schedule 2.

ANDREW BAYLY (National—Hunua): Thank you, Madam Chair. I’d like to talk to my Supplementary Order Paper (SOP) 477 because it, essentially, relates to clause 59B. This is an issue that we on the Finance and Expenditure Committee have talked about significantly. In my view, this is one of those instances of something that is taking place that is terribly inequitable, pernicious, and wrong. What I’m referring to is the situation where we have many hundreds of thousands of New Zealanders who have ended up paying too much tax on their PIE investment income. This is an ever-growing problem.

So, in the last financial year, approximately 950,000 people who had a portfolio investment entity—commonly referred to as a PIE, and that, in layman’s terms, would mean having an investment such as a KiwiSaver account or other fund management type of investment vehicle—these people in many cases inadvertently have paid too much tax or their PIR—or prescribed investor rate—was wrong. This situation is something that has increased over time and, as at the end of the 2018/19 year, there is about $42 million in tax owing to these people who’ve paid too much tax. On the other side, we’ve got people who have paid too little tax on their PIE investment income; the IRD, under the orders of the Government, have been seeking these people out and making sure that they are paying their just amount of tax on their PIE investment income, and that’s correct.

We have a principle in New Zealand which is that you pay your necessary amount of tax but you pay no more. This issue, which has arisen over time, but, essentially, in the 2018/19 year, has become very, very substantial—and that’s why my SOP deliberately talks about that being the financial year—from that date forward, in that one year, as I said before, there’s $42 million, there will be another amount accruing in this financial year, and, of course, this carries on. Now, the bill talks about addressing this problem of paying back money owed to these New Zealanders in the year 2021/22, and that is wrong because these amounts, this $50 million—maybe $60 million or $70 million by the time we get to that point—should be paid to New Zealanders earning the lowest amount of income in New Zealand. In essence, most of them are amounts owing to people earning less than $48,000, and individually the amount’s not a lot, but it is a heck of a lot of money that New Zealanders are owed by the Government. There is absolutely no reason why that shouldn’t be repaid.

When I questioned the Minister Stuart Nash in the House, he said that it’s an issue of technology. So then I did speak to the commissioner about it, and she did confirm that it wasn’t an issue of technology. So then it was an issue of needing to do a legislative requirement. So I helpfully drafted an SOP for the Minister and presented it to the Minister and presented it to the select committee, and that would have allowed for this to take place effective from the 2018/19 year. What this Minister has chosen to do is to nick that money from those low-paid New Zealanders and retain that money, balance probably up to $70 million, and keep it in the Government’s accounts—and that I think is absolutely wrong. There are many, many hundreds of thousands of New Zealanders affected by this, and I just think that the Minister seriously needs to reconsider this. I’d say to this Minister, “Pay the cash back, Nash, because it needs to go back to the rightful owners.” It is inequitable.

Hon JUDITH COLLINS (National—Papakura): I would like to speak in relation to Andrew Bayly‘s Supplementary Order Paper 477. I am a former Minister of Revenue for, unfortunately, only about nine months, otherwise we would have been in Government when the technological changes were made for IRD, which we funded and all that, and it’s been an ongoing process. It was once a technological issue for Inland Revenue, and that’s why the law was put in place: to say that they did not have to refund the money, because they couldn’t physically do it—that was one of their issues. But now that the technology has been invested in over many years, around about $1 billion, and I think that my colleague the Hon Michael Woodhouse was the Minister at the time when we first started the process to actually—[Interruption]—oh, actually, yes even earlier than that—bring the Inland Review computer system and technological system up to date and to that terrible word “futureproof”—whatever that means—it. We can do this now but we can’t do it while the law is as it is. That’s why Andrew Bayly’s Supplementary Order Paper is a very sensible and reasoned way of dealing with it.

I would say to the Minister in the chair, Stuart Nash, that I was disappointed in the second reading speech that he gave, where he made some comments about what we could have done; well, we were doing what we could do but now he has the ability and we are there to help when it comes to the law change. It is not fair for the Government to hold money that it doesn’t—and, actually, not hold it; keep it and spend it—deserve to have and shouldn’t have. As has been stated from Andrew Bayly, these are, in most cases, people who have the smallest amounts, often, in investment and they are not often able to switch and change and do all sorts of other things with their investments. It is simply wrong for the Government to retain and to use money that it is not entitled to. Whether it’s $60 million or $100 million or $30 million—whatever—it’s still not right; it’s not right for anyone else to do it and it’s not right for the Government. The only reason that it was allowed before was because of the technological difficulty of sorting it.

So our system of tax collection is very effective because it relies on people doing the right thing, PAYE, and also people’s withholding taxes and everything else coming out, without Inland Revenue having to do much for it. It is done by employers, it’s done by the people who are the investment advisers; it’s done by other people, a lot of that work. So, surely, Inland Revenue could, now that it has the technology—and as Andrew Bayly said, the commissioner has confirmed that they do have the technology now to do it—this would be a really good thing to do, and it would help to also increase the confidence in the tax system, which is important for the well-functioning working of a system that relies, in a great deal, on the goodwill and the work of others—unpaid work of employers and those who have to collect taxes, child support, and all the other things.

So I just don’t understand why the Government wouldn’t want to take this opportunity. I would say to the Minister in the chair: it’s not often that we get, in Parliament, very genuine opportunities to make this sort of change, which is hardly likely to be an election issue—it is hardly likely to be something that, you know, the 6 o’clock news covers tonight—but it is something that will make a difference and it will right a wrong.

Hon Shane Jones: Headline hunting.

Hon JUDITH COLLINS: I think that when the Hon Shane Jones calls out “Headline hunting”, there is that old saying of the pot calling the kettle black, actually. I would say to Mr Jones that even he would have difficulty making a headline out of a portfolio investment entity (PIE) interest rate, but I think that he wouldn’t know what the pie was. But having said that—

Hon Stuart Nash: He knows what pies are.

CHAIRPERSON (Hon Anne Tolley): Mince and cheese.

Hon JUDITH COLLINS: Ha! Let’s just stick to the issue, which is that this is actually a very good Supplementary Order Paper. That’s why I’m speaking to it, and I think it is something—I know it is something—that if we’d had the ability when I was the Minister of Revenue we would have done it, and that’s why we should do it now.

Hon STUART NASH (Minister of Revenue): Thank you so much, Madam Chair. One thing I would like to say to Mr Bayly is “Nash has paid back the cash.” What I would say to the member is, in Opposition, he may well remember that I used to query the Inland Revenue every single year as to why they held $750 million in account that was actually owed to Kiwis. This was money that Kiwis hadn’t claimed in overpaid tax. And now, due to the changes made in Business Transformation, we are actually paying that cash back to Kiwis without them having to proactively contact the IRD or an intermediary themselves. So that money—$750 million—the vast majority of that is being paid back to Kiwis.

So I think if you look at a lot of mischief in Inland Revenue—and you know, I will talk about the former Minister’s contribution in a second—we have actually got on top of this. Let’s put this into perspective—and one thing I will say is I do have a little bit of sympathy for where the member is coming from, but let’s put this into perspective—it’s my understanding that people who have overpaid have overpaid about a dollar a week. Now it’s still a dollar a week they have overpaid, but it’s about a dollar a week. It’s not as if they have overpaid tax that’s in the hundreds or the thousands of dollars. It’s a dollar a week.

The other thing I would say, and I remember when the member mentioned this Supplementary Order Paper (SOP)—I thought about this and I went back and I had a look at my KiwiSaver statement that had been sent to me by my provider. I would say that I think, actually, a lot of KiwiSaver providers who, by and large, use portfolio investment entities (PIEs) to invest their clients’ moneys could have taken a little bit more responsibility for this. Why we have ended up in this situation is because there is a default rate that tax is paid if a taxpayer does not provide their correct tax rate. It was impossible for Inland Revenue to determine if the default rate was in fact the default or if in fact that tax rate had been provided by the taxpayer themselves. So they could not separate the default rate from a taxpayer who’d actually been proactive.

But I actually believe that KiwiSaver providers, who are by and large—not all, but by and large—making fees out of their clients, could have been a lot more proactive in saying to their clients, “Make sure you are on the right tax rate, because if you are not, you are overpaying tax and you cannot claim this back.” Keeping in mind, this is not something that has just come into being. This has always been the case ever since PIEs have been set up. The rules have been that if you overpay your tax, you will not be able to get this back. This is not something new. It has always been in place.

The other thing I will say is the SOP put up by Mr Bayly would require taxpayers to contact IRD proactively, because IRD does not have the data themselves to proactively do this and contact taxpayers themselves. This would have to be done proactively.

The other thing I would say—and the former member of Revenue does know this—

Hon Judith Collins: Minister.

Hon STUART NASH: —sorry; the former Minister of Revenue does know this—is that every now and again, the commissioner has to make a captain’s call about the best use of resource for her men and women. I know that the commissioner has appeared before the Finance and Expenditure Committee and explained in quite, quite graphic detail around why she made the call that this was going to be the way forward. Part of that was that this would take significant resource and a whole lot of time and effort because they don’t hold the data. They would have to go back significantly. So what we have done is we have fixed the problem. We have fixed the problem. People will pay the right amount of tax going forward, but looking back, it is just far too much work to be done. That is a call made by the Commissioner of Inland Revenue, and I trust that she has a much better oversight of resource allocation and cost benefit analysis than we do, and I trust the commissioner has made the right call here. I back her 100 percent. I hope that has answered all the members’ questions. Thank you very much.

ANDREW BAYLY (National—Hunua): Now, that just shows a Minister totally out of touch on this issue, because the first thing—and if the Minister disagrees with this, he needs to stand—is that New Zealanders should pay their fair share of tax and no more. That is the hallmark of our tax system. What I just heard from the Minister was, “We’ve got $750 million and we’ve paid most of it back.” That is not right. This is an issue—this is money that the Government should not be holding. It does not own this money. It’s owed to those people who have paid it. The issue I’ve got with your logic, Minister, is that you’re saying, “If a KiwiSaver person has not told their provider, then it’s their fault and therefore we’re going to keep the money.” That logic does not stand up. That logic is not right, because that’s contrary to the principle of fair tax in New Zealand.

The second thing is about the resourcing—and I’ve never heard that argument before, because I’ve had two arguments: one is “We don’t have the system.” I did speak to the commissioner personally and also at the Finance and Expenditure Committee. She confirmed that she can pay it back. The second issue—and you said that it takes a legislative change and all that sort of difficulty; we have the legislative framework to make it effective from 2018-19. We do not need to wait till 2021 or 2022.

The third thing about this—the resourcing aspect—actually, the commissioner has decided that she wishes to commit resources to collect the tax from those people who’ve underpaid on the same KiwiSaver portfolio investment entity (PIE) arrangements, but not put the money into going and paying it back—and, actually, it’s not a big cost to pay it back. It can be paid back.

The last bit I just want to take the Minister up on is the supposition that it’s the KiwiSaver person who is at fault here. I’ll give you the experience of a lady called Georgina Burgess. She is actually an economist. She was working and living in Sweden. She immigrated to New Zealand as one of those highly desirable immigrants that we need in New Zealand. She came here; she is an incredibly hard worker. She is saving for a house. That is why she was so keen to put her money into a KiwiSaver account. She had three attempts to try to find out what her prescribed investor rate (PIR) was. She had multiple attempts to try to find out from her provider.

That was the issue—and this is an economist who is well-informed, absolutely engaged, and wanted to make sure she is on the right rate. She tried and tried and tried and could not get an adequate response from a provider. So do you know what this lady decided to do? She decided to change her provider because she knew if she changed provider, she would actually work out what her PIR was. And it was only at the point when she changed her provider—which is not easy to do; she went to the effort and time to do that; but at that point she worked out that she had been overpaying her tax because the provider had been deducting it at the wrong rate. That’s when she reduced her PIR. She was in that situation, she’d overpaid, and you are now saying the resourcing issue is we can’t pay back Georgina.

Her partner, who is also another immigrant, from South America, who is in a professional job, actually got a promotion in his work in New Zealand. He came with her to New Zealand, got a promotion, and ended up inadvertently underpaying his PIR because someone didn’t tell the IRD that, actually, he was earning more. So guess what? He got a call from the IRD saying, “Pay more tax on your PIE income.”

So here were two hard-working Kiwis saving for a house—and that’s why they’d invested in KiwiSaver. On one side of the ledger, someone who’d got a promotion, got ahead, working well in New Zealand, got a demand for more tax; the other person inadvertently had paid too much tax, and you say: “We cannot use the resources of Government to pay back nearly $60 million or $70 million to hard-working Kiwis.” That is fundamentally wrong, Minister. You should pay back their cash. Waiting until 2021 or 2022 is not right. You have the provision to do it now.

Hon STUART NASH (Minister of Revenue): There’s two things I’ll say with regard to this. First and foremost, the story about the woman who tried to get her right portfolio investment entity (PIE) rate off her provider just backs up my argument. I would say to you, Mr Bayly, that that provider was absolutely remiss in the service that it provided to its client.

Hon Michael Woodhouse: That’s not the point.

Hon STUART NASH: No, it is the point, and that is my point. The providers of the—[Interruption] Listen to me for one second. The provider is taking money and making money out of the clients, and for it not to provide a level of information that gives the clients a level of transparency I think is very remiss. I would have recommended anyone who can’t get that information from their provider, with one phone call, to change. I certainly would.

The second thing I would say is that this comes in the 2020-21 year, not the 2021-22 year. So it’s the 2020-21 year.

The third thing I would say is that this is the issue that we were facing about, you know, this chap who got a promotion. So the default PIE rate was 28. If you’re on the top marginal tax rate, you pay 28. But we had no idea whether someone had contacted IR and said, “My rate is 28.”, or if that was the default rate that had been set. So we had no idea how to check this. If it was a lower rate, then we did have the ability to check that, because, obviously, someone had been in touch with the Inland Revenue and put that rate in place, because everyone started on the default rate—everyone started on that default rate. So, obviously, that gentleman had contacted IR and said, “This is what my rate should be.” He got a promotion; went to 28. IR said, “Well, is that a default rate or is that where he should be?”

The fourth thing I would say—and this is actually the most important point, and I know the member does know this. I know we have two former Ministers of Revenue sitting in the House at the moment, and both of them will actually know this as well. The fundamental principle behind our tax system is that it is actually the obligation of the taxpayer to provide the right information to Inland Revenue. That is the fundamental principle—the fundamental principle—behind our tax system, and that is that the taxpayer provides the right information to Inland Revenue.

Now, this is the last thing I’m going to say on this, because I think I’ve answered all the questions put forward and I would hate to have to relitigate yet again points that have already been made twice by two members, by three members. So let’s move on from this, because I think I’ve answered all your questions and I’m not prepared to relitigate again.

Hon MICHAEL WOODHOUSE (National): That response really does behove a further examination of the Minister’s completely dismissive response to Andrew Bayly’s Supplementary Order Paper (SOP). It was the classic “the dog ate my lunch” excuse, and then it got worse. It got worse because he basically blamed the taxpayer for paying too much tax and is saying that’s a reason not to pay it back. Well, frankly, if we take that analogy to a further degree and we talk about other types of tax—for example, income tax or student loans—and a taxpayer finds out that their employer, because they had put the employee on the wrong rate of tax, had overpaid tax, the Minister is basically saying that’s the employer’s fault, therefore the IRD does not have to do anything about it.

Well, I know IRD don’t take that approach, actually. They do say—because you can file a return and get the income tax back at the end of the year, and IRD don’t blame the employer and they certainly don’t blame the taxpayer. It is a proper and lawful—in fact, legal—requirement, as Mr Bayly says, for the taxpayer to have a right not to pay any more tax than he or she is required to by law. To turn around and say “That’s the KiwiSaver provider’s problem. Bad luck. IRD has nothing to do with that” is the most dismissive, victim-blaming, “dog ate my lunch” excuse that I have ever heard for not giving people their money back.

In a previous call, the Minister talked about captain’s calls and resources as if the Commissioner of Inland Revenue had made a captain’s call not to pay the money back because that would take too much resource. What he has also said is that the Commissioner of Inland Revenue has made a captain’s call to invest just as much resource in collecting the nickel and dime money that might have been underpaid by a taxpayer. What we hear from Inland Revenue—their strapline for years was “It’s our job to be fair”. Well, I say this: that is not fair. It is lazy, it is selfish, and it is wrong. Mr Bayly’s SOP is the right thing to do, and I implore the Minister and the Government—he might say, “Well, the overwhelming amount of the money that’s over-collected by IRD or overpaid by the taxpayer is paid back where the taxpayer can be identified and located.” That’s fine. Then do it in this case. Be consistent. Be the thing that is on IRD’s strapline: fair.

Rt Hon DAVID CARTER (National): I want to challenge the Minister, when he finishes this debate in the House, to meet with the commissioner, because the commissioner came before the Finance and Expenditure Committee, and by my recollection of a question put by a member of the Opposition to the commissioner, “Was it a resourcing issue as to whether IRD were in a position to pay back this overpaid $40-odd million?”, her response to us was that it was not a resourcing issue. In fact, I think the next question posed by the National member at that committee was: “Was it the Government’s call not to pay back the $40-odd million?” And the answer from the commissioner was that it was the Government’s call.

Now, if that is the case, then the explanation given by the Minister five or 10 minutes ago to this committee of the whole House is absolutely incorrect. I accept the Minister’s earlier point that this is not a new issue, but prior to the millions of dollars spent on the Business Transformation Programme, IRD did not have the capability of identifying those who had overpaid their tax and the ability to pay back that overpaid tax, but because of Business Transformation, they have. They have the same technology that the Government and IR are going to now use to chase the 950,000 people who have underpaid their portfolio investment entity because of an incorrect prescribed investor rate. So the Government and IR are in a position to chase those that have underpaid, but they equally have the ability to track those who have overpaid and pay it back.

This is nothing but a capricious tax grab by the Government, and while the Minister says it’s only a dollar a week to most of them—that is an outrageous statement by the Minister. I am also a former Associate Minister of Revenue, and one of the things I say with pride is the way IRD has improved its communication, its reputation, with taxpayers right throughout New Zealand. It has been a remarkable transformation whilst I’ve been in this House, and it’s something like this that stands to damage the very image that IR has created. It’s not because of the commissioner’s call; it’s because the Government’s made the call that they won’t give back $50-odd million that’s been overpaid.

I just think the Minister has a chance to fix it. Not often do you get a tax bill before this House where there is such an easy opportunity to fix what we know is wrong, and all it takes is a bit of courage and gumption from a Government to use a Supplementary Order Paper that’s been advanced by an Opposition member, and this problem can be fixed.

Andrew Bayly: Or just change the date in the bill.

Rt Hon DAVID CARTER: Change the date in the bill—there are solutions here in the committee of the whole House stage for the Government to do what’s right. It’ll chase the money that it’s owed by those who have underpaid; why won’t it give back the money to those that have overpaid their tax? Mr Nash started his contribution by saying “Nash has given back the tax”. He pointed out, I think, it was $750 million that he’s proudly—

Andrew Bayly: No, no, only some of that.

Rt Hon DAVID CARTER: Well, some of it has been given back and Mr Nash was trying to claim credit for that, then recognised we’re not dealing with a lot of money—$40-45 million—but it’s growing all the time, Mr Nash. But I say to the Minister: do the right thing. It’s not a new issue—we all accept that. There wasn’t the ability to identify and set up a system within IR to do it before Business Transformation—that’s been ticked off. All it requires now is a simple legislative change, and that opportunity, Mr Nash, is before this committee as we speak. All it will require is a Minister and a Government wanting to do the right thing and burying its pride and accepting a Supplementary Order Paper that’s been submitted by an Opposition National member. I challenge the Minister to do it.

IAN McKELVIE (National—Rangitīkei): Thank you, Madam Chair. I had no intention of taking a call on this section, because I thought Mr Bayly argued his point very well, but he clearly needs a bit of support. I rise to support Supplementary Order Paper (SOP) 477, but not so much to support the SOP but the principle behind it. In our tax system—and I accept the Business Transformation that the IR are undertaking is going to create some huge advantages, both for the New Zealand taxpayer and for the revenue in due course. But I think that the principle of paying tax in New Zealand is a principle that it’s fair, and I think when you pay too much tax, you should equally be refunded, as you are the opposite when you don’t pay enough tax. I think that’s the principle of this.

When you drive down the Ngauranga Gorge, as I do quite frequently, on the left you see a little old shed with LV Martin’s name on it, and, of course, that sums up this exactly. His famous statement was “It’s putting it right that counts”, and I think that this Parliament has a duty, in my view, to put things right.

But I think the real principle of this SOP and the issue that it raises is a much broader one than just the issue around the unpaid $50 million in tax, and that is that if people are going to have confidence in the Inland Revenue as they move forward, they need to have confidence that what they do is fair and equitable and that they will treat our taxpayers as taxpayers treat them. I’m all in favour of those people who don’t pay enough tax being chased up by the IR—I think it’s important that they are—but equally, if you do pay too much tax, you need to get it back as quickly as possible. It’s going to be very interesting to watch the tax take drop in the next few months—very unfortunate for New Zealand, but that’s just where the world economy seems to be at at the moment—and that’s going to create a whole lot more challenges for the Inland Revenue as people recalculate their tax liability, and that will result in a whole lot more tax refunds.

I just want to comment on a couple of other things on the Business Transformation, because it relates directly to this SOP and the issues that it raises. I think that it’s very difficult in a country like ours—or as we see technology advancing so rapidly around the world, it’s very difficult to get the pitch right. It’s all very well to sit on Lambton Quay or sit in Wellington and make decisions about how New Zealanders are going to be treated and how they’re going to operate in the future, but not everyone in our country is equal; not everyone has access to equal services. I think it’s really important that we take our time with a lot of these things and that we manage it in a manner that we take people with us. Certainly, I think not paying back taxes that could be owing is one of those things that defeats that purpose and certainly leads people to have a little less confidence in an entity that it’s hugely important that we do have confidence in.

So I don’t want to go on any longer. That was just a contribution I felt I didn’t need to make, but, in fact, I think I do, because I think that Mr Bayly’s SOP is well worth supporting, and I think it raises an issue that no doubt will be raised again in the future. Of course, when you think we have at least three or four tax bills a year coming through this House, the IR are pretty keen on getting changes implemented quickly and they move ahead of the market, but we need to make sure that the market has confidence in their ability to do so. Thank you.

ANDREW BAYLY (National—Hunua): I do want to talk about something else, but I want to just have one more talk on this specific issue, and, hopefully, the Minister will be able to respond or will take the opportunity to respond. But the thing about this money is it is owed to those people earning the least amount of money in New Zealand. It doesn’t apply to people like us on the top tax bracket, because the default rate is lower. So the issue about this is that this applies to the people on the lowest rates of tax, and, by implication, that means the people earning the least amount in New Zealand. The bit I find disquieting is, I look over the other side there and I see a Labour Party and I see the Minister who has been in the chair, with his very bright, red tie, proudly supporting the Labour Party and its ideals about looking after people in New Zealand who are less fortunate than others. And I haven’t had one call from any member of that House other than the Minister. This is wrong from that perspective. I look over here to the Greens, who have a strong socialist ideal that goes through their party, and, again, there is just a deafening silence.

This is not about National protecting its rich mates, as it’s sometimes characterised by members of the Government. But this is actually a bill about protecting the rights of the people who are the least informed, the least empowered to make a change, who are the least sophisticated in terms of understanding these types of arrangements—after all, who knows what a prescribed investor rate, a portfolio investment entity, is; when we step out of this debating chamber in a half an hour’s time or whatever, no one knows it other than a few geeks like us.

Yet the reality, if you strip away all the terminology in this bill, is what this bill is about is working and helping those people who most need it in New Zealand. And that’s why I just can’t understand it. I find it reprehensible that the members of the Labour and the Greens particularly—I don’t think New Zealand First would have much interest in an issue like this—but you, you’re two proud parties who say you represent the people who are the most dispossessed in New Zealand. On an issue like this, and we’re not talking about an inconsequential amount of money, by the time we get to when this gets paid or balanced, it is probably in the order of $70 million that is owed to these people. Stand up for their rights, you people over the other side in the Government. Stand up for their people that need you at a time when they do not have the capability. That’s what MPs are about. This is what this bill is about. It’s not about technology and resourcing and all that sort of stuff. It can be done; the commissioner has said she can do it. There is a legislative framework to do it.

If you don’t want to accept my Supplementary Order Paper (SOP), simply change the date in the bill and make it effective from 2018-19. It’s that easy. But the Government should not be holding this money. It is not our income, it is not our money. It is owed to those New Zealanders. Pay it back, Minister. [Bell rung] OK, I’ll carry on, Madam Chair. Can I take a call?

CHAIRPERSON (Hon Ruth Dyson): Sure, Andrew Bayly.

ANDREW BAYLY: Thank you. Right, I was hoping for the Minister to, and I pleaded for him, so I’ll take another call. But I’m hoping the Minister will respond on that substantive issue.

I now want to turn to this issue round employment share schemes—

Tim van de Molen: Are the Greens going to back your SOP?

ANDREW BAYLY: And, also, yes, that’s a very good point from my colleague. I’m hoping we’re going to get a call from the Greens about the SOP. It would be very helpful if the Greens stepped up and at least put forward their view as to whether, in fact, the SOP is something that they might support, or otherwise.

But I just want to turn now to the issue of employee shares schemes, and this is a very relevant part, because in New Zealand we are trying to create an environment for the business community to thrive, and to grow, and to be innovative. And this clause, regarding employment share schemes—it’s covered broadly under sort of clause 69 inserting new section CE 7CB to the Income Tax Act, Madam Chair, just for your reference. But basically, this is the component of our business sector which is the most innovative and creative. Those are the fledging businesses where normally young people go out and basically forgo a good salary with the view of creating large businesses over time.

So part of that is that those businesses often don’t have the cash available to pay full salaries. And the trade-off, the quid pro quo for that, is that in many cases, in order to attract that young talent—that dynamic young talent that we need in New Zealand and we need them to flourish—what happens is they are offered employment share schemes. Now, they might be in the form of options, they might be in form of different types of shares, and I don’t really want to go into that. But this enables them to get those people who take up these options or shares to participate in the future increase in the value of that company. And that comes about through their hard endeavours as they make that company successful over time. So they’re trading off the income now—and, therefore, the tax on that—for the gain on the capital value of that company, if it’s sold or transferred or a new investor comes into play.

So one of the issues with this, with this dynamic creative sector—and we do have a flourishing creative sector in New Zealand, covering a whole suite of different businesses—is that these businesses, as they morph, transfer, and mature over time, increasingly look for new investors to come in. And that is the issue with this, because under the tax rules, there was a requirement that you must hold the shares and there cannot be a substantial change in the shareholding of that company. That, of course, is all about restricting the ability to bring in new, fresh capital to continue to fund the growth of that company over time. And so this clause looked at how these instruments are valued, and there’s three methodologies that are proposed which are a slightly wider sort of definition of those and more flexible. I think that’s a very good part of this, and I think for many people who are involved in this sector, and future people that are going to be involved, this is a very, very important part.

The other bit is in the event of a takeover or corporate reorganisation—and often what happens with these companies is they might go down one track and then they work out that there’s no market for that. They’ll change tack. They may park up a subsidiary and move into a new area. And under those arrangements, this bill provides much more flexibility around it and also in terms of the level of shareholding, and it builds more flexibility around that as well. So I think these takeovers, these capital injections, are an important facet of companies growing from early stage through to much more mature companies. And I think the aspects in this should be highlighted. We need to tell the investment community in New Zealand. We need to make sure our young people who are thinking about getting into creating businesses are aware of this because this is a very good piece of legislation to ensure that we have a flourishing new source of companies coming into the market in New Zealand.

KIERAN McANULTY (Junior Whip—Labour): I move, That the question be now put.

Motion agreed to.

The question was put that the amendments set out on Supplementary Order Paper 453 in the name of the Hon Stuart Nash to Part 3 be agreed to.

Amendments agreed to.

The question was put that the amendment set out on Supplementary Order Paper 477 in the name of Andrew Bayly to Part 3 be agreed to.

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

Ayes 56

New Zealand National 55; Ross.

Noes 63

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

Amendments not agreed to.

Part 3 as amended agreed to.

Schedule 1 agreed to.

Schedule 2 agreed to.

Clause 1 agreed to.

Clause 2

The question was put that the amendments set out on Supplementary Order Paper 453 and the following tabled amendment in the name of the Hon Stuart Nash to clause 2 be agreed to:

in subclause (19) delete “113(12),”.

Amendments agreed to.

CHAIRPERSON (Hon Ruth Dyson): Andrew Bayly’s amendments to clause 2 set out on Supplementary Order Paper 477 are out of order as being inconsistent with a previous decision of the committee.

Clause 2 as amended agreed to.

Bill to be reported with amendment presently.

Bills

Smoke-free Environments (Prohibiting Smoking in Motor Vehicles Carrying Children) Amendment Bill

In Committee

Part 1 Amendments to principal Act

Hon MICHAEL WOODHOUSE (National): I’m pleased to take the first call in the Smoke-free Environments (Prohibiting Smoking in Motor Vehicles Carrying Children) Amendment Bill, a bill that I, at least, have supported with some reservations. We have had quite a bit of a discussion this week around freedom of expression in another bill and I think also, from a values base, that the question of freedom to choose how one lives one’s life has also underpinned the very cautious support for this bill. Because what we have in this bill is the State going in, effectively, to the private property and the private affairs of families to say how they should live. That is a quite large step to take.

There is, I believe, an important question of family sovereignty when it comes to the choices they make, even when those choices are bad ones. But on balance, and given the very important goal that we have of setting the country up for smoke-free 2025 and also the fact that this is a piece of legislation designed to prevent harm to children, on balance, I and the National Party caucus have supported it so far.

We had excellent submissions, actually, including from some fabulous young people into the select committee—that was articulated in the second reading. I want to draw on that as we go into some of the questions and the proposed amendments, including the first one in my name, which was an amendment to Part 1A, because Part 1A does the most extraordinary thing.

The bill says that it will be unlawful to smoke in a car with a person under the age of 18, and then inexplicably it says that if the car is stationary and used as a dwelling, it’s OK. That is the most extraordinary piece of double-think that I have ever seen in a piece of legislation. If, having crossed into the realm of the decision that this is a place the State should be, then be there properly. If the State wants to genuinely protect children from the harmful effects of tobacco because the enclosed space is so small, then do it properly. And yet we have this extraordinary paragraph: paragraph (b) in section 20D(2), in Part 1A, where the person may smoke in a motor vehicle if the motor vehicle is stationary on a road and in use as a dwelling.

I’m aware the Minister has Supplementary Order Paper 452 to amend that particular part of the legislation, but I don’t think it’s good enough. I don’t think that particular paragraph should be there. My tabled amendment simply does away with this ridiculous inconsistency with the stated purpose of this bill.

Now, the Health Committee also had quite a discussion about the other exception—or at least the National members of the committee did—in paragraph 20D(2)(a) of Part 1A, set out in clause 9, which is where, if the person themselves under the age of 18 is in the car and they are smoking, then that should be OK. I think, on balance, that this does highlight an inconsistency in the message the State is sending about the responsibility of people under the age of 18 not to smoke, and I’m not comfortable with that but, nevertheless, I don’t think it’s as large and egregious a breach of the goals of this bill to actually remove it.

Now, also in Part 1, we have the question of vaping or, in fact, we don’t have the question of vaping, because vaping actually isn’t mentioned in here. This is an amendment to the Smoke-free Environments Act. Of course, as we know, vaping is not included in the Smoke-free Environments Act. There was a strong call from the committee to include it.

The reason officials said that that wouldn’t be the case is because the vaping legislation was coming soon. Well, it is coming soon. We will be considering that matter later in the not too distant future, but I think the inconsistency—I won’t take too long finishing this opening remark. The lack of energy around the smoke-free environments—because we ran the very real possibility that the bill would be passed into law without the vaping legislation actually being in place—was of great concern to submitters. It remains a concern to me. Thankfully, I think the time frame that the Government does want to pursue will mean that there won’t be this unusual loophole where it’s not OK to smoke but it’s OK to vape. We will get there in the end, but I think there was a significant concern amongst submitters about the absence of that from Part 1. With those opening remarks, I look forward to the debate proceeding.

Hon JENNY SALESA (Associate Minister of Health): Thank you, Madam Chair. The primary purpose of this bill is to protect our children, our tamariki, from the harmful effects of second-hand smoke. Too many of especially our tamariki and Pacific young children are exposed to second-hand smoke in the vehicles that they usually travel in when adults are smoking.

Part 1 of this bill actually will amend the Smoke-free Environments Act 1990 to prohibit smoking in stationary and moving motor vehicles for children under the age of 18. Supplementary Order Paper (SOP) 481, that the Hon Michael Woodhouse has just tabled in the committee, to amend section 20D(2)(b), set out in clause 9, is basically saying that a person may smoke in a motor vehicle if that person is the only occupant of the motor vehicle and if that person is under the age of 18.

I have actually tabled SOP 452, because when we listened to the submissions that came through, it was very clear that a lot of our submitters actually said that we should look at this and, you know, we should actually address it. Our Government has listened to the submitters. What the SOP that I’ve tabled will do is it will address new section 20D(2)(b), which currently exempts all vehicles that are stationary on a road and used as a dwelling from the prohibition on smoking while children are present.

The rationale for this exemption is that people have a right to smoke in their own homes, whether they are temporary, like motorhomes or caravans, or permanent. Our Government has listened to those concerns, which is why we are tabling this SOP to narrow the gamut of the bill. The SOP will exempt vehicles such as caravans, motorhomes, that are designed to be used as dwellings when they are stationary or on a road and being used as a dwelling.

The prohibition on smoking in all vehicles such as cars and utes will be retained, but caravans or motorhomes that are used on a road would still need to comply with the smoking prohibition if and when children are in those vehicles. I believe that this SOP strikes the right balance. It retains the bill’s focus on protecting our tamariki, our children, from second-hand smoke while at the same time not infringing on the rights of people to smoke in their own homes. These caravans and motorhomes are used as homes by our people.

In terms of Part 2 of the bill, it amends the Summary Proceedings Act 1957—

CHAIRPERSON (Hon Ruth Dyson): We’re on Part 1—we’re on Part 1.

Hon JENNY SALESA: Sorry. That would be my contribution for now, and I look forward to contributions from the committee.

Hon MAGGIE BARRY (National—North Shore): Thank you, Madam Chair. I rise to speak to the Smoke-free Environments (Prohibiting Smoking in Motor Vehicles Carrying Children) Amendment Bill. This is a bill that, as our health spokesperson, the Hon Michael Woodhouse, has said, doesn’t go far enough. It doesn’t include vaping.

With respect to Minister Jenny Salesa, who has just resumed her seat, the Supplementary Order Paper (SOP) tabled in her name does not go far enough. It narrows it somewhat by exempting caravans, motorhomes. While the intention of the SOP is to narrow the focus, it is still ridiculous to allow smoking in cars where young people might be if they are used as a dwelling. It is the kind of virtue signalling that has made a nonsense of a bill that really ought to be making a heavyweight contribution to New Zealand’s goal of being smoke-free by 2025, something that in the past, the Labour Party—and certainly the Māori Party when it was here—championed under Dame Tariana Turia.

So we need to be sensible if we’re going to attain the goals. Unfortunately, this SOP stops short of good sense, because people will still be able to smoke in vehicles where there are children, if they are parked on the side of the road. So while there may be some exemption around homes, I think the underlying dogma that people should—while not desirable that they live in cars, but if they do, then they are still able to smoke in those cars if it is stationary, with children in the car.

I have a deep failure to understand why an individual who needs to smoke a cigarette can’t just get out of the vehicle for the duration of smoking a cigarette. I was conferring with my learned colleague Ian McKelvie about how long it takes to smoke a cigarette. We’re a little hazy on that one, but it’s a couple of minutes. It’s not going to be a game-changer. If somebody is that addicted that they have to have their cigarette—fine, get out of the vehicle. Do not leave those toxins and that smoke in the car.

So while the SOP in the name of the Minister goes a certain way to tweak new section 20D(2)(b), set out in clause 9, it doesn’t go far enough in our view, so we won’t be supporting it. However, we will support the far more sensible SOP in the name of the Hon Michael Woodhouse, which is that a person may smoke in a motor vehicle if the person is the only occupant of that motor vehicle, and is under the age of 18 years.

So it is an effort to, I don’t know, kind of improve a bill that needs more. But on the other hand, we are trying to be positive and constructive on this side of the Chamber, so that is an SOP that we will support, because it does go some way to amending a fairly, you know, fundamental flaw in this bill. I have been in the select committee and I have spoken on this bill several times. I think that, as the Hon Michael Woodhouse has pointed out, some of the submitters, including young people, who are at the heart of this legislation, came to us with very moving and intelligent and articulate testimony that we must do all we can as legislators to stop the smoking in cars.

The vaping issue, which we will come to later under extended hours in this Chamber—slightly concerning that it wasn’t better organised and did not come in at a time to help inform this Smoke-free Environments (Prohibiting Smoking in Motor Vehicles Carrying Children) Amendment Bill, but it seems to have been scrambled together. So it will be up for debate in the Chamber later this morning. But it’s part of the overall package of incoherence of this Government, where it makes piecemeal adjustments, takes legislation that we had prepared, for example, in the case of the Hon Nicky Wagner who had an excellent bill formerly and has tried to put it before the House on a number of occasions. It’s been turned down for the most base sort of political reasoning and it is now almost replicated and coming back, lo and behold, as a Government bill when the Hon Nicky Wagner had put all the hard work and effort into it.

It was a bill that should have been passed a long time ago with the political will of this House, but it wasn’t, because of Labour and the Greens and the dogma they bring to this one and their fundamental failure to acknowledge that anybody but themselves has an idea around what would make good legislation.

So a lot of time’s been wasted, not only in this House but also in the lives of young people who have been adversely impacted for years longer than they needed to be in terms of smoking in vehicles because this slack, incoherent, incompetent Government couldn’t get their act together to support the Hon Nicky Wagner’s bill and has not listened to good sense in the select committee. I hope that the House will support the Hon Michael Woodhouse’s Supplementary Order Paper. Thank you.

Hon MICHAEL WOODHOUSE (National): Following on from that and, indeed, addressing a couple of the comments Minister Salesa made in response to both of the Supplementary Order Papers (SOPs) that are in consideration for the committee on Part 1A, I want to first touch on the comment that the Minister said that this bill is measured because it doesn’t go as far into the private affairs of families as, for example, a ban on smoking in houses would. Well, I just want to respond to that by reflecting on both a phone conversation and a media interview that the Children’s Commissioner did when this bill was introduced.

Mr Becroft contacted me to ask me and my caucus to support this bill, and we had a long conversation about the interference into the private affairs by the State because of this bill. I made the comment to him that I thought that the next step would be—in my view a significant step too far—the imposition by the State into the family home, into the house. I said that that was just a step far too far for me, and he said, “Well, Mr Woodhouse, if I am asked by the media, I will say that that’s what the Government should be doing next.” Well, actually, he didn’t wait to be asked. In the very first interview he gave about that, he made it very clear that it was his view that that’s where the State should be going.

Now, I have a huge admiration for the advocacy that Andrew Becroft does for our tamariki, but I have to respectfully and strongly disagree that that is an appropriate next step by the Government into the private affairs of family. I really am uncomfortable with where we’re going here. But as I say, if we are going to do it, at least let’s do it right.

I note the Minister’s comments in defence of, and the support for, her SOP 452, which actually says, “Well, if we change the definition of a vehicle to one that is manufactured for use as an occasional or permanent dwelling, then the exception is OK.” Well, I’m sorry, we’re taking the eye off the ball here. I think there are two issues here. I mean, I live in Dunedin and my playground is central Otago, and like other places like the Coromandel—

Dan Bidois: North Shore.

Hon MICHAEL WOODHOUSE: Well, not quite the North Shore. I don’t think freedom camping is quite the issue on the North Shore, because that’s where I was going. I see a plethora of vehicles around Lake Dunstan all summer that masquerade as vehicles for use as occasional or permanent dwellings. In order to get around these freedom camping rules, what people do is they put those stickers on the back of those vehicles to say, “It has ablutions” or something—some kind of loose reference to the vehicle being used as an occasional or permanent dwelling, and that is a nonsense for most of the time.

The big white Kia campervans—we all know they’re campervans and what they are. But people living in vehicles—under this Government the numbers have gone up—are using these things as an occasional or, in terrible cases, permanent dwelling. Who is to say? Who is the arbiter of whether a vehicle is actually manufactured for that purpose? That is its practical use by freedom campers, by our increasing numbers of homeless, and the Government, effectively, admits defeat on that issue by saying, “Well, they’re going to use a vehicle as a home; let’s let them smoke in that home.” It’s ridiculous. It’s absolutely dancing on the head of a definitional pin which nobody is able to police.

So I say to the Minister and the Government: if the Government is going to take this step, at least take this step properly and consistently, because they have also said this is a policy, a law, that will be most effective in the prevention rather than the prosecution—and I’ll come to that in a later intervention. But if it is truly going to be most effective in the prevention, be consistent and holistic in preventing smoking in vehicles with children under the age of 18. It’s the only sensible thing to do. It’s what the select committee was told by submitters was the only sensible thing to do, and people are scratching their heads at this odd exception. My SOP will clarify that and remove any doubt about what this bill is intended to do.

MATT DOOCEY (National—Waimakariri): Thank you very much, Madam Chair. It’s a pleasure to take a call in this committee of the whole House on the Smoke-free Environments (Prohibiting Smoking in Motor Vehicles Carrying Children) Amendment Bill. I would like to start by signalling that I think no one in this House disagrees about the risk you put children at by smoking in a car with children with you—not only the physical impact, but I’d also highlight the psychological impact. When you talk to people who had the unfortunate experience of growing up and inhaling the second-hand smoke of either their parents or another adult in the front seats, that psychological harm can stay with people for a very long time.

So how do we get to a position where everyone in the House agrees that second-hand smoke on young children in a car, physically and psychologically, is harmful, yet we are in a position where we’re trying to, for some reason, carve out a definition between whether the car is moving or is stationary. Because, in fact, it’s actually irrelevant; that harm is still there. So I would like to hear from the Minister a bit more about why now we have a change of heart, so to speak. Because it’s very well for the Minister to say, “Well, we listened to submitters.” Well, if we had listened to submitters, we would not be in a position now needing the Government to put forward a Supplementary Order Paper (SOP). If we’d listened to submitters, then this carve-out would have been agreed at the select committee stage.

So I want to know what has changed since the select committee stage, where we were under the understanding that there would be no change to hear, and that is why the bill presents itself in the committee of the whole House at this stage. Because I would imagine that, in fact, the reason why the Minister has been dragged kicking and screaming to bring this SOP to this Chamber is because she’s been shown up by the Hon Michael Woodhouse and his SOP. In fact, if you were to go out and talk to the average New Zealander and say that the Government’s passing a bill to say that you can’t smoke in a car with kids unless you’re living in it, they’d scratch their heads and say, “What’s going on here?”

Not only that, but we got to the select committee stage and heard a lot of submissions from some very credible submitters, and still the Government had shown no interest in changing it. What we’ve now got is we’re playing catch up, and what I find really confusing is that you’ve got a Government that’s shown no interest—and the Government members on that select committee showed no interest when we were hearing from submitters—in changing this part, and now, because of our health spokesperson, quite rightly, reflecting on what submitters told us and what the public is telling us, and putting forward an SOP, well, all of a sudden, the Minister has decided that we’ve listened to submitters. Well, I don’t think we did, but we are in this position.

I had actually asked for some clarification around SOP 452, because we are, in clause 9, replacing subsection (3) of section 20E with new subsection (3), paragraph (b), which says, “stationary on a road and in use as a dwelling.” With that line there, are we not just going to end up with what the bill is actually saying now? So it won’t change anything.

Yes, I can understand why in paragraph (a) it talks about a vehicle that’s been “manufactured for use as an occasional or permanent dwelling;”, which is that argument about a motorhome. We understand that. But by putting in paragraph (b), does that just not return us back to the status quo? That’s why, actually, for a Minister who’s got an army of officials, I think she’s been shown up today by an Opposition spokesperson who’s probably writing his own SOPs and has actually got it right.

Hon JENNY SALESA (Associate Minister of Health): I’d like to address the comments from both the Hon Michael Woodhouse—about his Supplementary Order Paper (SOP) 481—as well as the member Matt Doocey. The Government SOP has been tabled for a while. As far as I am advised, however, SOP 481 was tabled, I think, just last night. In terms of why is it that we’re introducing this Government SOP, it is because there are people who are living in motorhomes and caravans, and the Hon Michael Woodhouse alluded to this in his comments. We do not want to get to a place where we are going into people’s homes and saying “Thou shalt not smoke in your own home.”

If I can actually reflect back to the changes in Aotearoa New Zealand in terms of social norms that happened when we introduced the smoke-free ruling that areas like bars, workplaces, and restaurants would be smoke-free, that is, essentially, what we say will happen here, as well. It is not about the issuing of the infringement notices and it is not about the police actually stopping people if there are children in the cars where they are smoking. It is about all of us in Aotearoa New Zealand behaving in a different way. What we saw with smoke-free areas in terms of workplaces when it was introduced was that it didn’t happen overnight, but all of us actually then changed the way we acted. This is also what we believe will happen with this particular bill.

We can look at other jurisdictions—say, for instance, the UK and lots of states in Canada, as well as Australia, and if you have a look at the UK, when they introduced smoke-free cars in the UK, over a period of 18 months, there were only two infringement notices where folks were taken to court. When you look at our own history here in Aotearoa New Zealand, over a period of 15 years there has been only a handful of cases where infringement notices have resulted in people being taken to court because they hadn’t actually adhered to workplaces being smoke-free.

What we’re saying, and what we know from public surveys, is that over 90 percent of Aotearoa New Zealand believe that smoking in vehicles when our children are in those vehicles is not the right to do. We believe that this will happen here, as well, but we do not want to infringe on people’s rights when it is their own homes. So that is why we’re introducing SOP 452—to make a differentiation for folks that are living in vehicles that have been manufactured to be occasional or permanent dwelling places.

Hon MICHAEL WOODHOUSE (National): Thank you, Madam Chair. In respect of the rather unusual comment by Minister Jenny Salesa that implied, I think, that somehow my Supplementary Order Paper 481, because it was tabled only last night, had less force or effect, or was less worthy than hers, it was—

Matt Doocey: It was signalled in the committee stage.

Hon MICHAEL WOODHOUSE: Exactly right, Mr Doocey. It was signalled very clearly in the select committee, it was signalled very clearly in the second reading, and it has been tabled well in advance for members to have a look at it. It’s really simple—delete a stupid clause—and there was a very good reason, I think, why we should, which I’ve articulated.

I want to go on to another matter that the Minister raised, and that is the role of the police in this. She said words to the effect that it’s not about police stopping cars and issuing infringement, but it’s about prevention. Well, that’s true, except the issue of prevention—and the example the Minister used was that, “Well, you know, we got our smoking rates down because of the public stigma around people smoking.” That’s why people smoke in cars—because they can’t smoke in bars and they get harassed when they smoke in the street. The car is actually one of the few places, or the few—up until this bill is passed—safe havens, where they don’t get seen as easily, or identified and stigmatised in the way they might in other parts of society.

The UK example was a very good one. The question isn’t whether there were lots of infringement notices issued, Minister. The question was actually whether it genuinely resulted in fewer people smoking in cars. I think it is a much, much longer-term issue to answer that question, because we know with the cellphone ban which was introduced when Steven Joyce was the Minister of Transport—so it must have been around 2010 or 2011—nine years later, there is still unacceptably high cellphone use while driving. The police periodically have a blitz, and one has to wonder whether, if we don’t have the same stigmatisation of smoking in cars that leads to a reduction in its incidence, the police will be asked to go on a smoking blitz. That, in my view, is an appalling use of police resources. We now know that when victimisation rates in this country are going up massively under this Government, when violent crime is going up, and when gang membership is going up, we’re going to worry about whether someone’s having a fag in the car.

The Government says, “Well, that’s not our intention.”, except in Part 1, there is the most extraordinary section that I have ever seen. It, basically, treats police like idiots. It’s in new section 20E in clause 9 and is entitled “Constable’s powers”, and it goes on to say that “(1) A constable who sees a person smoking in a motor vehicle that is on a road [blah-blah-blah should] (a) signal or request the driver of the motor vehicle to stop the vehicle as soon as practicable: (b) require the driver to remain stopped for as long as is reasonably necessary for the constable to make the inquiries and complete the exercise of powers under this section:”. It goes on. There are another two paragraphs here, Mr Mark Mitchell, that your former colleagues are going to be treated like complete idiots and like they somehow don’t know how to exercise a discretion—including the discretion to do nothing—because they’ve got better things to do.

Instead, they’ve got this cookbook, ABC “Here’s what you do if you see a person having a fag in a car.” It completely undermines the Government’s statements that this is not about prosecution when they put a whole page of what a constable should do in this situation.

Hon Tim Macindoe: That should go in the regulations bonfire.

Hon MICHAEL WOODHOUSE: Absolutely. The first up into the bonfire, Mr Macindoe—a very good point.

I think the question of infringement is one that was answered in the select committee, around what we’re really trying to do here. We were told by officials that it’s not about infringement, but we were then told by officials that the bill can’t come into force for 18 months, because that’s how long it’s going to take New Zealand Police to adjust their IT systems to enable infringement notices that they’ll issue to be recorded.

I will speak more about the commencement date at the appropriate time, because I think it’s ludicrous that we’re going to pass a bill and go, “Nah, it’s OK. We’re not going to do anything about it for 18 months.” That really calls into question the Government’s commitment to Smokefree 2025.

The question was put that the amendments set out on Supplementary Order Paper 452 in the name of the Hon Jenny Salesa to clause 9 be agreed to.

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

Amendments agreed to.

CHAIRPERSON (Hon Ruth Dyson): The Hon Michael Woodhouse’s amendment to clause 9, set out on Supplementary Order Paper 481, is out of order as being inconsistent with a previous decision of the committee in relation to the Minister’s Supplementary Order Paper 452.

Part 1 as amended agreed to.

Part 2 agreed to.

Clauses 1 to 3

Hon MICHAEL WOODHOUSE (National): This committee needs to consider how seriously we are taking this, because, now, having committed to the fact that we agree that the State should be required to prevent smoking in cars where children are present, then the question is: why are being asked to wait 18 months for this to become effective? The select committee debated this at length, and we got advice from officials—it was the Ministry of Health and the Ministry of Justice—basically saying, “We consider this will undermine the efficacy of an enforcement agency as there will be no imperative to comply with the direction of an individual if an individual were not liable to penalty.” This was in response to my suggestion that the bill actually come into force on the day after it receives Royal assent, except for the infringement regime, because New Zealand Police told us that it would take 18 months for them to be able to implement the systems required to actually write infringements.

So, again, it reinforces that inconsistency about whether this is a bill, an Act, effective in prevention or prosecution. If it’s an Act effective in the prosecution, then our public health officials should have the force of law behind them when they go out in their health promotion campaigns, which can start straight away, to say that smoking in cars is bad. We’ve already got those TV ads, you know, with the woman sitting in the car by the side of the rugby field and the smoke drifting out the car as the kids are coming towards it. It’s a form of subtle stigmatisation of the smoking habit. Why not beef that up and say that not only is it wrong, it’s unlawful?

The fact that they might not be punished for it—and, indeed, that’s not the Government’s stated intention—should not prevent this House from requiring the Act to become effective as soon as the Governor-General gives it the Royal assent. So I am tabling a Supplementary Order Paper (SOP), with apologies to the Minister because it did come quite late. This one I do have to take up. I had believed, actually, that National in the select committee report had indicated that we would do this. We certainly were unhappy with the timing of the implementation of the Act, but I didn’t actually do that, and, as a consequence, the SOP has come late.

The tabled SOP in my name, however, amends clause 2 so that the commencement for new sections 20D(3) and (4) and 20F come into force 18 months after the date on which this Act receives the Royal assent, but the rest of the Act comes into effect on the day after it gets Royal assent. Now, those sections are the infringement regime. So the support for this and the appetite for this, I think, says two things. It’s a question, and the answer the Government gives to it will speak to what they really want to be doing here. Is this about prevention or prosecution and how energetically they want to pursue the goal of Smokefree 2025? Because if the answers to those questions are that it is a preventive strategy, not a prosecutorial one, and if the answer is “We are really serious about making sure we get to Smokefree 2025.”, then the committee must support my tabled amendment. It sends a very clear signal that we are serious about this, that we can take action on this.

I simply do not agree that there will be no imperative to comply with a direction if an individual were not liable to a penalty. And their response to that is there’s no imperative to even make the Act effective for 18 months. It was a very inconsistent piece of advice from the officials, who otherwise did a fantastic job. I must say it’s not my place to criticise the role of officials overall. They do a remarkable job for our select committees, but on this piece of advice, I respectfully and strongly disagree. We should be bringing this bill into force as soon as we can.

We should be requiring our health promotion agencies to highlight the reality that smoking in cars is now unlawful, albeit that there won’t be a punishment—they don’t need to say that—and we could spend 18 months on a public education campaign prior to the infringement regime coming in. That to me is common-sense lawmaking.

MATT DOOCEY (National—Waimakariri): Thank you, Madam Chair. I want to follow on from my colleague the Hon Michael Woodhouse, our health spokesperson, who, once again, is an Opposition spokesperson who doesn’t have an army of officials, but actually has tabled a very succinct Supplementary Order Paper that actually speaks volumes, in fact, of a change that this bill needs. Now, we all agree this bill is important and we all agree that this behaviour needs to stop sooner rather than later, so then why, as my colleague has pointed out, wait for 18 months after the Royal assent? Yes, we take the argument that there needs to be some time to put the infringement process in place, but I think what we’re actually doing is sending a very clear message. I mean, what’s the importance of bringing a bill to the House and then saying that, actually, we’ll wait 18 months? If this issue is an important issue that needs to take up the House’s time today, then why would it not be enacted once it gets the Royal assent?

We need to send a very clear message to those who are smoking in cars with young children. In fact, I would argue that getting rid of the 18-month stand-down, as I put it, is actually part of the education campaign that needs to be rolled out. If we are saying that it needs to be enacted urgently, we’re actually reinforcing that education campaign—that it needs to be taken seriously.

I would also like to ask the Minister in the chair, the Hon Jenny Salesa, why maybe an Order in Council isn’t looked at. In fact, a good example is that some bills are going through select committees at the moment where they do have a date but they are also putting in an Order in Council. So if things are lined up earlier, then the enactment date can be brought forward. What we’re rather concerned at is that this might take longer than expected. And we come back to the original point from my colleague: why would we wait 18 months? If this is important enough for the House today, then why do we not send a very clear message?

When you break it up like that, as my colleague has done, it actually is simplified; yes, there are two parts to this: the enactment of the Act and sending a very clear message, and the infringement process. We don’t disagree that, potentially, it may take 18 months for that to be installed. But firstly, why would you not separate it, like the Supplementary Order Paper in the name of the Hon Michael Woodhouse, and, secondly, why not put an Order in Council in? So if things line up earlier—because, of course, let’s be honest, a new Government coming up will probably get things done a bit quicker—we mightn’t need 18 months. Maybe we might be able to do it—and I see a few nodding heads—in a shorter time. So I would like the answer to those two questions from the Minister in the chair.

Hon JENNY SALESA (Associate Minister of Health): I do agree with the Hon Michael Woodhouse when he says that we should be looking at a social campaign, because, you see, the focus of this particular bill is about prevention; it is about changing people’s behaviour. This is not a punitive bill where we’re focusing on the infringement notices and on the police ensuring that people are fined. And on that note, we are not actually waiting for the 18-month period before the social campaign begins. In fact, the Ministry of Health has already had several discussions with the Health Promotion Agency so that as soon as the Royal assent is actually put in place, the Health Promotion Agency can begin the social campaign, because it is in our interest to let all of New Zealand know that this is a law that’s coming into line.

In terms of the infringement notices and the fines, the reason why we’re asking for the 18-month period is it will take a while to get that system up and running. Police will have to train their folks—you know, they do have the power of discretion if and when they do stop someone. One of the things that they could do instead of issuing a fine—what we’re actually asking the police, and they have to be trained in this—is refer people to a stop smoking or cessation service. This is one of the reasons why we’re asking for that period.

But the thing that we do agree with the honourable member on is the fact that we must focus on prevention and ensure that the whole of New Zealand, the public, knows that this law is coming into line, and that we should focus on ensuring that they know well in advance before the 18-month period is up.

I do want to reflect back on other jurisdictions, as I said earlier. In Australia, Canada, as well as the UK, they weren’t actually focused on the fines and the infringement notices. The focus there is basically on helping the country to change their behaviour, to ensure that when they go into a car, and if there are children in that car that are 18 years or younger, if they want to smoke, they possibly stop the car, step out, and smoke—that they change their behaviour and that they do not expose their children, their tamariki, to second-hand smoke.

We do know that it is actually the tar and the thousands of toxins that are in the smoke and tobacco—that is what is most harmful to our children, and that is absolutely what we’re wanting to change here, to ensure that we do not continue to expose our children to second-hand smoke, because the reality in Aotearoa New Zealand today is we still have up to 5,000 people who die from smoking-related diseases every year, and this is one of the reasons why we’re having this legislation being introduced, because this will help us get to Smokefree Aotearoa 2025. It is about saving people’s lives, and in this instance, it’s all about saving our children’s lives. Thank you, Madam Chair.

Hon MICHAEL WOODHOUSE (National): Thank you, Madam Chair. I just want to take a very quick call to make three points—I won’t delay the consideration in committee. Can I first commend the Minister for her willingness to engage in this process. I think both the process in the committee of the whole House and, you know, even if the amendments aren’t agreed to, the thorough examination of them strengthens that process. So I do commend the Minister for that.

I heard an inconsistency in what she said around the fact that this was not about infringement, but the very reason we’re being delayed 18 months is because we’re going to put in place an infringement regime, and I just want to highlight the inconsistency there. I do agree, and I do hope, that the health promotion agencies are going to embark on an increased campaign, but they’re already doing it. It is not as strong a message to say this will soon be unlawful than it is to say this is unlawful, and I think we have an opportunity to strengthen that argument in that promotion.

Clause 1 agreed to.

The question was put that the following amendment in the name of the Hon Michael Woodhouse to clause 2 be agreed to:

Replace clause 2 with:

2 Commencement

(1) New sections 20D(3) and (4) and 20F come into force 18 months after the date on which this Act receives the Royal Assent.

(2) The rest of this Act comes into force on the day after the date on which this Act receives the Royal assent.

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

Ayes 56

New Zealand National 55; Ross.

Noes 63

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

Amendment not agreed to.

Result corrected after originally being reported as Ayes 63, Noes 56.

Clause 2 agreed to.

Clause 3 agreed to.

House resumed.

The Chairperson reported the Taxation (KiwiSaver, Student Loans, and Remedial Matters) Bill with amendment, and the Smoke-free Environments (Prohibiting Smoking in Motor Vehicles Carrying Children) Amendment Bill with amendment.

Report adopted.

Bills

Smokefree Environments and Regulated Products (Vaping) Amendment Bill

First Reading

Debate resumed from 5 March.

Hon JENNY SALESA (Associate Minister of Health): As I was saying, public health experts for many decades have grappled with the curse of tobacco. In 1976, in a paper in the British Medical Journal, Professor Michael Russell wrote that people smoke for the nicotine but they die from the tar. That simple statement is as true today as it was 44 years ago. In his paper, Professor Russell believed the answer to helping smokers was to find a cigarette that maintained a sufficient level of nicotine, the addictive substance that is craved, while reducing the amount of tar.

Professor Russell would not have been able to foresee that three decades later, the first modern electronic cigarette would be able to deliver a chosen amount of nicotine without the need for tar at all—that people would be able to inhale the nicotine they craved while being spared from the fatal cocktail of tar and burning tobacco and the thousands of toxins in the smoke.

The credit for this technological development is frequently given to the Chinese pharmacist Hon Lik, who was himself a heavy smoker. Desperate to quit after seeing his father die from the same addiction, the products inspired Hon’s breakthrough, representing, arguably, the most disruptive technology for breaking the addiction of tobacco the world has ever seen. Of course, I’m referring here to vaping. Many people want to quit smoking, but quitting is very challenging. I know this from friends who smoke as well as from a number of people who have shared their journey of quitting smoking with me. While vaping is not harmless, because it does not burn tobacco or produce tar and toxins—which occurs in cigarettes—we know that vaping is significantly less harmful compared to smoking tobacco. It is a disruptive technology and has a role in helping us reach our smoke-free 2025 goal.

If the only concern this Government faced in drafting this legislation was to encourage vaping for smokers who wish to quit, our job would have been relatively simple, but regulating vaping is not that simple. Indeed, there are two sides to the issue. Nicotine is a highly addictive substance that companies have, in the past, chosen to introduce to children and young people and non-smokers in order to create dependency and therefore create customers to line their pockets with profit, if you like. Vaping products carry the same risk.

I’m deeply concerned that some vaping companies have demonstrated aggressive marketing towards our young people in other jurisdictions, and that danger exists in Aotearoa New Zealand too. In recent months, I’ve seen vaping advertising on TV, on billboards, on bus shelters, and even on my teenage daughters’ social media feeds.

Academic research reveals what they’re up to when it comes to our young people. A recent paper from Stanford University school of medicine found that JUUL Labs’ advertising imagery in its first six months on the market was patently youth oriented. The research has cast light on what most people watching this tidal wave of trendy nicotine products felt: that JUUL claiming that it was marketing to smokers was not congruent with JUUL’s image, branding, or presence on youth-focused platforms.

The practices nicotine companies engaged in when their ads ruled the airwaves belong solidly in the 1950s. We expect better because this Government, more than any in recent memory, addresses the issues in the best interests of our tamariki and our young people. Our Prime Minister, the Rt Hon Jacinda Ardern, has made making New Zealand the best place in the world to be a child a priority for our Government. So when I hear from parents, teachers, and school principals—as I’ve done in recent months—reports that vaping is becoming far too common, especially in schools, I am deeply concerned.

While recent data from anti-smoking group Action for Smokefree 2025 suggests that there is no vaping epidemic in New Zealand—let me repeat that: there is no vaping youth epidemic here—now is the time for action to prevent such an epidemic from happening in our country.

With this bill, we are acting to stop the sale of vaping products to young people under the age of 18; require child-resistant packaging, like they have in the UK; ban advertising, including the kind of aggressive targeting of these products to children and young people that we’ve seen; be able to restrict flavours like watermelon, cherry cola, “berry-a-peelin”, apple pie, and others from being sold at corner dairies, supermarkets, and service stations; stop the kinds of promotions that were seen in the last two years where vaping companies were in our rugby clubs and promoting their nicotine products on our beaches over summer; and prevent the normalisation of vaping by extending the currently legislated smoke-free areas for tobacco to vaping, such as our schools, hospitals, workplaces, bars, and restaurants. All of this adds up to an important protection of our young people.

What about adults? While we know we don’t want young people vaping when they have never been smokers before, because we don’t want a new generation getting hooked on nicotine, adults will still ask: is it safe? The Government’s advice is, if you don’t currently smoke, do not take up vaping; however, if you are a smoker, vaping is substantially less harmful to you and your body than smoking. Only vape to quit.

This is a futureproof regime that will ensure Governments of the future can be swift in their response to emerging problems and evidence on vaping and, in particular, vape products. At the heart of our product safety regime is a notification system. This bill requires manufacturers and importers to notify products to the Ministry of Health before they market them. This will enable the ministry to follow up rapidly if any safety problems arise. The bill will also contain the ability for regulations on maximum nicotine levels.

This bill has elegantly dealt with the challenge of seeking to encourage vaping for current smokers and discouraging vaping for non-smokers and children. How we’ve done this, in part, is to confer a greater set of rights and responsibilities on to R18 specialty vape stores. What I’ve learnt through developing this bill is that there are some very responsible vaping retailers, particularly some of our specialist vaping retail store owners. Our regime gives them an important role in helping smokers to transition with advice behind the counter on how to quit cigarettes while vaping. This bill restricts the sale of flavours available at general retailers to tobacco, menthol, and mint, while still allowing adults to access a full range of flavours available in these specialist vaping retail stores.

The bill also contains a number of provisions unrelated to vaping and smokeless tobacco products that I look forward to discussing further when the bill progresses through this House.

Finally, I want to conclude by bringing it back to my focus—our children and our young people and tamariki. We are ambitious for our tamariki, and we would like our children to be the smoke-free generation in Aotearoa. We also want them to have more time with healthier parents and grandparents by seeing other generations also kick the smoking habit. We know that vaping is a disruptive technology with a lot of potential to contribute to smoke-free 2025, but we also know that we must be smart and careful to prevent this addictive product from becoming normalised amongst children and young people and non-smokers. This bill achieves that balance.

I look forward to the Health Committee’s consideration of the bill and the opportunity for all of New Zealand to have their say. I strongly commend this bill to the House. Thank you, Mr Speaker.

Hon MICHAEL WOODHOUSE (National): Well, the first thing to say about this bill is simply this—

Hon Jenny Salesa: I raise a point of order, Mr Speaker. I move that the Smoke-free Environments—

ASSISTANT SPEAKER (Adrian Rurawhe): Oh, no—we do that at the end. Sorry.

Hon MICHAEL WOODHOUSE: Thank you, Mr Speaker. The first thing to say about this bill at the outset is it’s about time. This has taken far, far too long to get before the House. It would have been understandable. The Associate Minister of Health Jenny Salesa said regulating vaping is not that simple. Well, guess what! It’s not that difficult either. One of the reasons why it was not that difficult was they had a virtual carbon copy of this bill handed to them because of the work that the Hon Nicky Wagner had done as Associate Minister of Health in the previous Government and then as a member introducing a member’s bill into the ballot. It took years.

Even the Ministry of Health was imploring the Minister to get on with it. I understand these things are complicated, but the Minister has an army of resources not only ready, willing, and waiting to help but telling her that they wanted to get on with it and get the bill into the House. We’re here now—2½ years in and with not sufficient time—

Darroch Ball: Do it once; do it right—not like the National Party.

Hon MICHAEL WOODHOUSE: Do it once and do it right, says Mr Ball; it’s about time they just did it. Talk’s cheap, Mr Ball. Governments need to deliver, and, in order to be able to keep their citizens safe, they need to do it a great deal more quickly.

Hon Mark Mitchell: He’s misguided.

Hon MICHAEL WOODHOUSE: Well, I suggest that he’s probably strolling through the situations vacant in The Dominion Post as we speak, because one thing’s for sure: he ain’t gonna be here in six months’ time.

We offered—we offered—to support the Government on vaping, and the Minister’s reply to the Leader of the Opposition and my offer to get around the table with officials so that we could speed this up and to help that process was, “We look forward to that once the bill’s introduced.” Now, that was six months ago.

What they’re doing now, according to the Minister’s first reading speech in her introduction, is that we are now going to rush it. They’ve spent years getting it here, and now we’re going to rush it through the select committee process. We’re going to support this bill, but, for reasons which we will come to—and they’re pretty obvious—in the debate on the report-back motion, we will strongly oppose that, because we believe there are plenty of things still to be done in this.

In fact, while I describe Nicky Wagner’s bill and this one as carbon copies, there are some very important things that are in Nicky Wagner’s bill that are not in this bill. It doesn’t require, for example, vaping products to be child-resistant. I would have thought, given the debate that committee of the whole House has just had, that that would have been front of mind for the Government. Requiring vaping products to have a mechanism for ensuring refilling without leakage, restricting refillable vaping tanks to a capacity of 2 millimetres, and constant dose monitoring and reporting for the vaping devices—all really important things that, I think, the select committee will hear about and want to discuss.

Now, I also want to point out something that I’m not sure the Minister mentioned, and that is that the Attorney-General has—and this is another reason why this needs a thorough going over—issued a report under section 7 of the New Zealand Bill of Rights Act (BORA), saying that the restrictions on advertising in the absence of scientific evidence on the harm associated with vaping is a restriction on freedom of expression that cannot be justified under that Act. Now, we know a bit about that because we’ve just had the funded family carers bill that the Minister seriously criticised the previous Government for ignoring a BORA vet. Well, I’ll be fascinated to know what her attitude is to this vet, because we have, again, been asked to consider a piece of legislation that is going to have a significant curtailment on the freedoms of New Zealanders to do certain things, and, I think, for that reason this really behoves the select committee’s consideration.

But all of that aside, I think, actually, the bill comes to this House and will be referred to the select committee in pretty good shape. I think the policy framework is there for the intent to be achieved, and that is to encourage people who are addicted to tobacco products to transition to the significantly less harmful vaping products at the same time as not encouraging people who don’t currently smoke to take it up, and particularly our young. I agree with the Minister that that’s a delicate balancing act that in the absence of a regulatory framework has actually been let go where these so-called responsible vaping traders have—there’s no doubt in my mind—created a marketing framework that is designed to attract people who are not currently addicted to nicotine to try vaping. I have relatives who are adolescents, teenagers, young adults who admit to me that that’s exactly what’s happened, and they can’t probably say why they did it, whether it was peer pressure or whether it was just what you did at a party or whether it was, to some degree, a part of that seductive advertising—the colours, the flavours, the groovy sort of advertisements you’re seeing on the TV.

So we’ve got to take a really, really close look. I understand what the Attorney-General is saying, and I highlight potential inconsistences in the Government’s response to that, but I think we’ve got to be really, really careful about striking the right balance between that freedom of expression and the goals of making sure our young people don’t take up vaping. I see the Health Committee chair, Louisa Wall, nodding in agreement with that. We heard—didn’t we?—from some fantastic submitters from Wainuiōmata and the Hutt Valley about what they are seeing in their schools.

Action for Smokefree 2025’s report into the incidents of vaping by year 10 children is probably unhelpful for two reasons. One is that if I was a fourth-former I wouldn’t be admitting to vaping if I did. I was smoking behind the bike sheds in fourth form—

Dan Bidois: Ha!

Hon MICHAEL WOODHOUSE: —and I wouldn’t—only smoking behind the bike sheds, Mr Bidois—admit, even in an anonymous survey, that that was the case.

The second thing they told us was that, actually, this is a thing that starts in years 12 and 13; it’s the older kids as they get to 17, 18 years old, and they’re going out to the first XV parties and they’re doing those other things—that’s when the pressure comes on. I think if we were to do a survey on the incidence of even casual vaping on those age groups, we would be seeing a different and much higher and, in my mind, more concerning incidence and prevalence of young people vaping.

So I think we’ve really got to take a good look at whether we’ve got the balance right. I think it’s a really, really good start, but we’re going to hear from the vaping industry. I think we’re going to get some really slick submissions. As members of that select committee know, I had a pretty big BS radar for the smoking industry coming into the select committee; I’ll be turning that radar on for the vaping industry, recognising that they actually have an important role to play in this, and they have advised me that, actually, they haven’t been part of the development of the bill to date. So that’s going to mean that if the House does prevail in the Minister’s request for a three-month report back, we’re going to need to be on our toes, I think, to give really good consideration to those submissions.

I want to just put on record the issue around flavours. Again, I think the balance between specialist vaping stores and other retail outlets like supermarkets, service stations, and dairies is about right as a starting point. But I’ve got a concern, and I’ve been misconstrued in the articulation of that concern around flavours. I don’t oppose flavours; actually, I think they are a pretty good tool to transition away from tobacco if that’s what the smoker wants. But I am concerned that constituent products in those flavours, despite having been approved by things like the Food and Drug Administration in the United States and other jurisdictions, is not appropriate for inhalation; they were approved for eating. So if you’re putting vanilla essence or cinnamon or other flavours into these vaping products and then you inhale them into your lungs, there could well be a harm that is not known for a long period of time. So, regardless of where we land on that, I think it’s going to be important that the officials follow the longitudinal studies globally, participate in them, and make sure that when we see signs of bad outcomes as a consequence we need to be quick to act to restrict those flavours. The Minister’s nodding in agreement, I’m sure she understands that and supports it.

It is a problem, though, because we didn’t know—and the Surgeon General in the United States used to endorse certain brands of tobacco; it was years before we realised how harmful it was, thanks to the tobacco lobby, before we actually got the regulatory framework in place. So I hope we can be more nimble if we see the harmful effects of vaping emerge, and I hope it’s earlier than that.

With that caveat and with, overall, I think, a very strong support for the start point where we’re at, I want to commend the bill. I look forward to the select committee process.

LOUISA WALL (Labour—Manurewa): Tēnā koe e Te Māngai o Te Whare. Tēnā koutou katoa. Can I firstly acknowledge the Minister Jenny Salesa and her ability to work across Government with our New Zealand First colleagues and also our Green colleagues in bringing this Smokefree Environments and Regulated Products (Vaping) Amendment Bill to the House. I acknowledge her and our coalition partners because, I think, as my colleague the Hon Michael Woodhouse has acknowledged, this is a comprehensive piece of legislation that, actually, in the end ended up trying to do two things.

The first was to ensure that those smokers had access to a product that was 95 percent less harmful. So we’re talking about people who smoke. The reality is that here in Aotearoa New Zealand, 5,000 New Zealanders die every year because of smoking-related diseases. A lot of the lobbying around access to these vaping products is from people like Professor Beaglehole, who know that these vaping products do work in minimising the effects of the addiction of nicotine, actually.

The other part of this bill is that we have to ensure that it doesn’t become a gateway product for our young people. I again want to pick up on something that the Hon Michael Woodhouse said in terms of our assessment of the smoke-free cars legislation. It was young people themselves who came and told us that it was cool to vape. They were seeing it from not the form 4 or the year 10 students but they were seeing it from the years 12 and 13 students. So it is a real issue.

I want to acknowledge that we will have, actually, some intense discussion, because if I look at what the law proposes to do: to ban the sale of vaping products to under-18-year-olds, to prohibit advertising of vaping products and smokeless tobacco, to restrict the sale of flavoured vaping products and e-cigarettes to R18 speciality stores—all to ensure that young people are not attracted to it—to limit general retailers, and to introduce this product safety system; as I said, incredibly comprehensive.

But the prohibition of the advertising, which has been highlighted by the Attorney-General—and I just want people to understand the context of the Attorney-General’s advice. Essentially, he’s saying that section 14 is about freedom of expression—that people have the right to seek, receive, impart, inform the public in a free and democratic society—and the limitations on that right have to be justified. They have to be reasonable limitations in a free and democratic society, and with tobacco products it’s been really clear: tobacco products harm. Tobacco products kill 5,000 New Zealanders every year. The issue with vaping is that, in and of itself, it may not kill 5,000 people every year. That’s the point of creating vaping products. They’re actually being created to help people who have addictions to still receive the nicotine but not the combustible part of the historic consumption through smoking cigarettes.

I guess the question then for us is: are vapes going to be a gateway product, and particularly for young people, and therefore that is why they should be deemed to be harmful? So I’ve already started looking at some of the evidence that we as a committee will have to assess, and there is a piece of research by Dr Blaha, who’s a cardiologist. He’s a professor of medicine at Johns Hopkins Medicine. There’s a study: the link between vaping, young people, and smoking. So the question before our committee will be: are vape products and e-cigarettes a gateway to smoking? Within the context of his research, there were 2 million young people, and he looked at their use of e-cigarettes as their first nicotine-based product. So these are young people who don’t smoke, and we all know that nicotine is highly addictive. The evidence from his research is that young people who vape are more likely to go on and use illicit drugs and tobacco products such as cigarettes, and so based on that research, we can say that, actually, vaping products are harmful for people who aren’t wanting to give up cigarettes. Therefore, is it going to be justifiable? The committee’s going to have to make that decision to prohibit advertising of vaping products that are specifically designed for young people that then may lead them to smoking. We have said we can’t advertise, because it’s justifiable, because it causes so much harm.

So that is going to be one of the crucial, I believe, decisions and discussions that we have in the select committee. I just generally, as the chair of the Health Committee, want to thank my colleagues on the Health Committee. The Minister has requested that we process the bill in an expedited time frame. You know, the time frames are usually six months; she’s asked us to do it in three months. But I have to say, she’s asked us to do it because, as we’ve heard, we must do it. Currently, these products are unregulated, and so we have an opportunity as a Parliament to progress this piece of legislation, which means that, from what I’ve just said, we reduce the risk to young people and we also provide those people who are smoking with a tool, with an ability, to minimise the harm based on the addiction of tobacco and nicotine. Kia ora.

MATT DOOCEY (National—Waimakariri): Thank you very much, Mr Speaker. It’s a pleasure to rise and speak in support of this important bill. I just want to acknowledge the last speaker, Louisa Wall, and acknowledge the great work she does as chair of the Health Committee. I do respect her for her work not only as a local MP but as the chair of the health select committee, but I’ll tell you what: I disagreed with that last point. Respectfully, I think it’s more probably toeing the party line that, you know, “We need this. It’s got to be expedited—three months instead of six for the select committee process, for submissions.” But in a backdrop of the Government dragging its heels for the last 2½ years, when they could have got on and put this bill up a lot earlier, they’re clearly feeling the pressure of wanting bills passed before an election, to look as though they have done something. The impact of that is going to be select committees rushing bills through that do not give an appropriate time for the public to have their say.

Now, look, I’m a pretty balanced person—well, I like to think I am—and there are some bills that, arguably, you mightn’t need the full six months, but I would argue this one needs its full time. Why? This is the first time in New Zealand we are going to be looking at vaping regulation. Even Darroch Ball, who was contributing to the Hon Michael Woodhouse’s speech earlier, was saying, you know, “Do it once. Do it right.” Well, if we are going to take Mr Ball’s approach and his advice, then why are we rushing through this bill? We want everyone to have their say, because I think there’s some real—well, there’ll be some quite contentious points, and I think that the last speaker, Louisa Wall, outlined them, I think, very articulately.

On one hand, we are needing to provide adults or young adults the ability to quit from normal smoking and transition to vaping, but how do we safeguard our children and our young people? What we don’t want is a perverse outcome that, yes, we allow some adults who’ve been smoking for a very long time and have failed to quit with the current tools the ability to move into vaping, but then find out that we’ve created a new market of young people who weren’t smoking traditional cigarettes and have gone straight into vaping. I use that word “market” on purpose, and quite provocatively as well, because I’ll tell you what: this is a very commercial market. Already, globally the vaping market is around $10 billion and expanding, literally, by the month. We don’t have any available data of what the commercial market is in New Zealand, but I would say it’s probably exponentially growing by the day.

I take the Hon Michael Woodhouse’s point of having his BS radar on during the submissions process, because I’ll tell you what: some of the submissions will be heavily influenced by players in the market seeing the commercial gain here. That’s why I think it’s very important that the regulations we bring in are informed by the right health approach, not necessarily informed by the right commercial approach, because what is going to play out in this debate—and it’s a classic dichotomy when you look at harm reduction versus abstinence. You know, the Government’s already fallen into this trap around the testing of party pills in dance parties, saying that testing will make it safe. No, it won’t. By informing a user of what the substance is, it might make it less harmful; it definitely doesn’t make it safe. The only safe way of using a drug is not to take it at all.

Then you have this argument of harm reduction versus abstinence, and I think, yes, some people have already started smoking, and, quite rightly, we are going to advocate that vaping is used as a tool to reduce the harm, but we must be very clear here: vaping is not safe. Yes, it’s apparently, by the research, 95 percent less harmful than current smoking, but it still carries risk. That is why we need to make sure we take the time and get the right regulation in place.

What’s disappointing is this current Government came in using words like “a new style of politics”. Things were going to be done differently. As we’ve heard, this was the ability to actually, well, put words into action. This could have been a cross-party, bipartisan bill. We’ve seen them in the House earlier, with the carbon zero bill, and the Opposition actually reached out, and the Minister declined that offer.

I think that’s disappointing for a Government that came in on the mantra that things were going to be done differently, because there was clearly a bill already put up. The Hon Nicky Wagner—how good is Nicky Wagner, I must say. Imitation is the best form of flattery, and that’s what this bill is. It’s an imitation of the Hon Nicky Wagner, the bill she had provided. So we had it. We lost 2½ years. But, respectfully to the Hon Nicky Wagner, there’s still more work to be done in this space, and that’s why we’re advocating to ensure that everyone is heard, because what we want in this argument and in this bill is a health approach.

I don’t think there’s anyone in this House that disagrees with the vision of smoke-free 2025, and we need to make sure that if we are really focused on achieving that in, dare I say it, five years to go—times are going quick—then we need to make sure we’re taking the best approach. I just hope that we are going to get this bill in the right shape.

So that’s why I encourage the main players in this space, and the public as well, to come forward and make their submission, because this is the first time New Zealand is going to have regulation around vaping. We need to make sure that New Zealanders have the right tools—the right tools to be informed by and the right tools to make their decision. But equally, we need to make sure we’re not providing the ability of a new cohort, a new generation, to come through with a new vice of their own. So that’s why I think there needs to be a lot of focus on this bill.

Finally, if I can just wrap up and say it is interesting that we have these approaches of vaping. We’re increasing the excise tax in tobacco products. We’ve got towns in my area of North Canterbury like Hanmer Springs, which is declaring itself smoke-free. So we’ve got the right things in train, but I do think one day we are going to have to face the real decision if, finally, we are going to outlaw and prohibit smoking products once and for all. Thank you, Mr Speaker.

Debate interrupted.

Voting

Correction—Smoke-free Environments (Prohibiting Smoking in Motor Vehicles Carrying Children) Amendment Bill

ASSISTANT SPEAKER (Adrian Rurawhe): Before I call Jenny Marcroft, members, in the committee of the whole House of the Smoke-free Environments (Prohibiting Smoking in Motor Vehicles Carrying Children) Amendment Bill, a vote was inaccurately reported to the committee. On the question on the tabled amendment of the Hon Michael Woodhouse to replace clause 2, the votes were reported as Ayes 63, Noes 56, when the correct votes were Ayes 56, Noes 63. The result of the vote was correctly reported as the amendment not being agreed to. The report on that vote will be corrected accordingly.

Bills

Smokefree Environments and Regulated Products (Vaping) Amendment Bill

First Reading

Debate resumed.

JENNY MARCROFT (NZ First): Tēnā koe. Thank you, Mr Speaker. It’s a pleasure to take my call on this, the Smokefree Environments and Regulated Products (Vaping) Amendment Bill. New Zealand First stands in support of this bill and acknowledges the work with the Minister, the Hon Jenny Salesa, working together with this to progress this bill, because it is important for the health of all New Zealanders that we take this bill through all its stages.

The Smokefree Environments and Regulated Products (Vaping) Amendment Bill introduces vaping regulations that strike the right balance between making sure vaping is available for smokers who want to use it as a quit tool while ensuring that these products are not marketed or sold to children and young people. So this bill will achieve a few very important things. It will ban the sale of vaping products to under-18-year-olds. It will prohibit the advertising of vaping products and smokeless tobacco. It will restrict the sale of flavoured vaping products and e-cigarettes to R18 specialty stores and will limit the general retailers—including dairies, supermarkets, and service stations—to only selling three flavours. Also, and probably more importantly, it will introduce a product safety system which enables the Ministry of Health to recall, suspend, and issue warnings about vaping products.

As a member of the Health Committee, I’ll be very pleased to hear the submissions that will come to us, as we all are, in the Health Committee, I think, in agreement that this bill is very much needed and timely as well. Just making note of the Minister the Hon Jenny Salesa’s comment, as she set out in her statement this morning, that the public health in New Zealand has battled against smoking and tobacco for decades, and that Governments of all descriptions, in fact, have pursued and progressed policies that sought to reduce the harm, the deaths, that come from smoking-related diseases inflicted on our communities.

The areas that I’d like to talk to in my contribution today relate around flavours and advertising in particular. Vape flavours, really, have come about as some sort of creative writer’s dream. They must sit around thinking up really cool names for these flavours: Nectar of the Dragon; Banoffee—bit of a dessert one, that one; Bad Blood, which is “Exotic blackcurrants and a chilling sensation that will excite the tongue”. Maybe there’s going to be a New Zealand flavour: Chur Bro. Even the musical genre is part of vaping flavours: Afternoon Delight.

Advertising, and in particular cigarette advertising, goes way back to the 1950s. Marlboro advertised and they had a campaign which had more influence on society than any other advertising campaign. Originally, Marlboro was a women’s brand of cigarettes, and it targeted women because they had these filter tips, because they knew in the 1950s that, actually, there was harm from smoking cigarettes. So they first of all targeted women by saying “Ivory tips to protect the lips”. They also went on with the Camel cigarette brand to have doctors used in advertising, and their slogan was “More doctors smoke Camels”. So we know that advertising is a really powerful tool to change the minds and persuade the populations.

So what they did with Marlboro was that they used macho, masculine types of characters, and then eventually they settled on the cowboy because he was a strong, hard-working, silent man in a hat, with spurs. They had this tagline: “Come to where the flavour is. Come to Marlboro country.” Now, the influence of this advertising campaign saw Marlboro become, in a very short space of time—in one year—the fourth-largest tobacco company in America, and within four years it was the biggest tobacco company across the country. The influence was absolutely huge, and, in fact, 90 percent of schoolchildren knew who the Marlboro Man was, yet they weren’t targeting children. However, at least four of the Marlboro men died of smoking-related diseases. Probably the most famous of them was Wayne McLaren, who died at 51 years old, after 25 years of smoking.

So we know that tobacco companies are masters at advertising, and we have in New Zealand—and my colleague from across the House Matt Doocey talked about it in his contribution, about the advertising: we don’t know how much money is being spent in New Zealand, because we haven’t taken that data and had a look at what they are advertising in terms of dollar figures with vaping. But we do know that they are spending hundreds of thousands of dollars. Half a dozen large vape clients in one media company are spending hundreds of thousands of dollars. One client in particular is spending $200,000 on a campaign. They are finding creative ways to skirt around rules and regulations. Maybe if it’s a visual for a digital advertisement, they’re using things like a very gorgeous looking woman, and instead of a cigarette in her fingers, she’s holding a piece of broccoli. There’s no mention of the word “vaping”. There are no other words other than very small ones at the bottom that will be the logo of that particular organisation.

There is one company, JUUL. Their vape is like a USB stick. They are called the iPhones of vapes because their cool tech makes people, young people in particular, attracted to vaping, addicting a whole new generation to nicotine. So we know that vaping and the advertising ban that will come in place with this piece of legislation is extremely important to protect, in particular, our young people.

I’d like to finish my contribution by acknowledging the work that will be done in the select committee, but also too the connection that New Zealand First and the close work we’ve been doing with Action for Smokefree 2025 over the past 12 months to ensure that we get world-leading legislation that has been properly peer reviewed internationally. Action for Smokefree 2025—I’m sure they will come to select committee, and we look forward to their contribution on this piece of legislation. This is a very sensible bill that we’ve worked with our coalition partners on, and we very much are pleased that it is here today for its first reading. I commend this bill to the House.

Hon TIM MACINDOE (National—Hamilton West): Kia ora, Mr Speaker. Let me begin with a positive, and that is to acknowledge the fact that, in the House this morning, we have heard some very intelligent contributions on this important issue from all who have spoken, and I want to thank them for that. But there is no getting around the fact that, as the Hon Michael Woodhouse mentioned earlier, this is certainly not only about time but, frankly and shamefully, well past time. I do want to acknowledge, as a couple of my colleagues have done, the Hon Nicky Wagner, who has done an outstanding job in providing not only leadership in this issue but in also doing all the work. Because we are, essentially, here belatedly acknowledging—and, I hope, ultimately enacting—the fine work that the Hon Nicky Wagner, National Party MP, former Minister under Sir John Key and Sir Bill English, did, and which was available more than a year ago and should have been enacted at that time.

Members of the Government ought to be shaking their heads, or, rather, hanging their heads in shame, as they acknowledge—and their heads are all down at the moment—the fact that this could have been dealt with by now. The important measures of this bill could already be in place, had they taken action, and the Minister in charge of the bill has to take responsibility for that. She’s a very pleasant person, and I acknowledge that. I have no pleasure in attacking her, but we have to lay the blame at her door and also at the door of the Leader of the House for failing to organise their legislative programme, in such a way that an important measure of this type has just not been dealt with.

So as I say, this is a National Party bill, and for that reason, we are naturally going to support it. The reason I’ve laboured that point at the outset is because what we will not be supporting—in fact, what we on the Opposition side of the House will be opposing as strenuously as possible—is the proposal that has been indicated by the Government to move for a shortened select committee process in order to deal with this bill. Well, they need to be reminded that they are a Government who have spent more than two years enacting very little of their own work. A huge amount of what has gone through the Parliament the last two years has been bills that they inherited from the previous National Government.

Even more importantly, even though the work that we’ve been dealing with has largely been unopposed for that reason, their members—including, at times, senior Ministers—have come down to the House, night after night, to filibuster on those bills, and some of them are in the House this morning.

Hon Mark Mitchell: Did Faaf do that? Faaf wouldn’t have done that.

Hon TIM MACINDOE: He did, among others. They have filibustered on bills that had no opposition in order to drag things out, because they didn’t have any work of their own to introduce to the House, and now here they are, just six months out from a general election, thinking, “Yikes. We’re running out of time. We do actually need to get on and do something, and in order to do that now, we will have to inflict upon the nation a constitutional outrage of a shortened select committee process, which denies members of the public the opportunity to have their say to make detailed, considered submissions and to be able to appear before the select committee to talk to those submissions and to raise questions and hear answers.”, and all because the current Government has been a chaotic shambles that has been completely out of control of the legislative agenda during its time in office to date.

ASSISTANT SPEAKER (Adrian Rurawhe): And now we can come to the bill, OK?

Hon TIM MACINDOE: I feel I have been speaking on the bill, Mr Speaker. Now, I’m not on the select committee—

Jenny Marcroft: Good.

Hon TIM MACINDOE: —but I have occasionally been subbed on to it. It’s nice of Mrs Marcroft to say that she’s pleased about that. I actually thought that we’ve worked quite constructively together when I have been on that committee. I am on National’s health caucus committee, and so I will follow the issue very closely. I do wish them well in their deliberations, and, as I say, I have respect for all the members of the Health Committee. When I’ve sat on it, I’ve been impressed by the work that they do.

Jenny Marcroft: And the morning tea.

Hon TIM MACINDOE: I haven’t often had the opportunity to enjoy the morning tea, Mrs Marcroft, but please let me know when you’re providing it and I’ll do my level best to make sure that I return to the committee and get subbed on, if only for the 20 minutes when it’s made available.

Now, this is an important issue because we know that many people are still dying in New Zealand of smoking-related illnesses every year. Fortunately, it’s trending downwards. I’m delighted that there are far fewer people smoking than used to be the case, and this vaping legislation is an important part of trying to continue to achieve our drive towards a smoke-free Aotearoa policy of 2025, which I think most people are strongly committed to; certainly most members of this House.

I recognise that giving up smoking is a difficult thing. I haven’t been a smoker myself other than, as Mr Woodhouse acknowledges, when I too, as a young fellow, occasionally did silly things at inappropriate times that would have caused my parents consternation, but I haven’t actually been—

Hon Member: Cannabis!

Hon TIM MACINDOE: Ha, ha! Well, I’ve already been pulled up by the Speaker once, for speaking irrelevantly and I really don’t want to tell him what I might have got up to in my school days, but—

David Seymour: We’re interested.

Hon TIM MACINDOE: I’m delighted you’re interested—I’ve lost my train of thought.

Hon Willie Jackson: Well, sit down then.

Hon TIM MACINDOE: The important thing is—no, no. I’m pleased to say that even when I lose my train of thought, Mr Jackson, I’m far more coherent than you ever have been in any of your speeches. I’m back on track now because, of course, what we are talking about is the important drive to reduce smoking in this country—ideally, to stop everybody smoking. I think we all acknowledge the fact that vaping has an important role to play in that. The health officials and advisers all tell us that—as long as we get the balance right.

This bill is about trying to get the balance right so that we provide vaping options for those who are trying to quit smoking without doing anything that encourages vaping as a cool activity, particularly for young people who might not otherwise have taken up smoking. And I’m sure all MPs, certainly electorate MPs, have heard regularly from school principals and health workers and others about their concern that we mustn’t create a regime whereby vaping becomes the next cool option. There’s already some evidence that it is. We want to try to ensure that that doesn’t become any more so.

So let me just focus on a few of the key provisions of the bill.

Dr Duncan Webb: Well, that would be nice!

Hon TIM MACINDOE: I’ve already alluded to some, Mr Webb, but actually, given your particular interest, I want to draw attention to some aspects of the Government’s bill that—

Hon Willie Jackson: Ooh, we can’t wait!

Hon TIM MACINDOE: Goodness me. Aren’t they excitable—aren’t they excitable! Clearly I’m hitting the spot. They didn’t like being reminded of how incompetent they’ve been—did they?—but fortunately, because they’ve picked up the Hon Nicky Wagner’s fine work, this bill would prohibit sales to under 18-year-olds. I think that’s important. We don’t want young people walking into the shops and being able to access vaping materials. We hope that their parents and caregivers would be able to influence sensible choices and be able to control the decisions they make. You can’t always control what a 14- or 15-year-old might do, but I think this is the right position for the bill to strike.

It would allow health professionals to recommend that people take up vaping in place of smoking. Obviously, we want that to be the better alternative if they are going to do one or the other. It would ensure that there are appropriate rules around advertising. That’s vitally important. As a child—and I think Mrs Marcroft was talking before about Marlboro adverts; I remember them and they were actually very appealing—I remember we used to have posters of them. You’d rip them out of the paper or the magazine, and you’d stick them on your bedroom wall. I do remember having pictures on my bedroom wall of the Marlboro Man or whatever it was, on his horse, with his cigarettes. My parents didn’t object to that as long as I wasn’t smoking under the bed covers. Fortunately, we’ve moved light years away from that. I guess I’m showing my age in even admitting to that.

But coming back to the bill, and I shouldn’t say that because I’m going to get another silly interjection from the other side, it is important, obviously, that we try to discourage that sort of inappropriate advertising and that we set quality standards and it of course does require the Ministry of Health to approve products and prohibit vaping in smoke-free areas.

In the short time available, as the shadow Attorney-General, can I just note that the Attorney-General has put forward a report suggesting that this is in contravention of the New Zealand Bill of Rights Act because of the constraints on advertising, as he is required to do. I respect the report that he has given, but I also believe that it is appropriate, and there’s ample precedent for this, not to allow that particular report to dissuade the Government from proceeding with this. It’s his important role to focus on that aspect, but there’s a more important overarching objective here, and there is ample precedent, as I say, for the Government to override that particular report. But I just wanted to acknowledge it because that is one of the portfolio responsibilities that I have.

Well, I’ve thoroughly enjoyed this contribution. I’m delighted that members of the Government have as well and I do commend the select committee in the work that they will do. Let’s get on and pass this bill.

CHLÖE SWARBRICK (Green): E Te Māngai, tēnā koe. Tēnā koutou e Te Whare. In light of the fact a number of people are sharing their past experiences with the culture in which they grew up, around smoking and tobacco and cigarettes, it probably is incumbent on me to talk about my experience when I was thrown out of class—I think in year 1 or 2—at primary school—

David Seymour: For smoking?

CHLÖE SWARBRICK: Not for smoking, Mr David Seymour, but for creating a small business in class whereby I cut up pieces of paper and emulated what I saw my dad doing, which was to create rollies, cigarettes, and I sold them for about 50c each. That was how cool smoking was when I was in primary school.

Fast forward a number of years, about 20, and my little brother is now 13 years old. I’m really stoked to say that smoking is no longer seen as a cool thing for kids of his generation. However, it is unfortunate that when he finds himself on the internet falling down the rabbit hole of YouTube videos, he is exposed to advertising for vaping, and that has led him to think that vaping is really cool and that it may actually be harmless. So what we need to be talking about here is figuring out how we strike the balance between harm reduction—recognising that vaping is a really important tobacco smoking cessation device and that we need to have some consistency in our approaches to addictive substances, which I’ll get to later, but also that what has occurred so far with regard to vaping and the market that has emerged around it has occurred as a result of self-regulation.

What we’ve seen in that process of self-regulation is that there has been advertising. There has been advertising, which some would argue appeals to children, and there has been the likes of these YouTube ads, but there’s also been what some may be familiar with here, known as influencer marketing. That is the more subtle way of having people who have profiles online utilising these products in their daily lives and presenting them as cool or important in their daily life. I think that that form of marketing needs to be all the more transparent.

But I diverge from the point of this legislation. The importance here is that we have the potential to get more people off of a really harmful, addictive substance. It’s really critical that we acknowledge as well that vaping is not 100 percent safe. In fact, it also comes with its own raft of potential health ramifications; a number of which we’re still researching and are coming to light. But they are still far less harmful than what we know with the decades of research that we have amassed on the smoking of tobacco.

One of our bottom lines in working with the Minister the Hon Jenny Salesa in supporting this legislation, as the Greens, was to make sure that we didn’t cut things off at their knees in that potential for smoking cessation, so that we didn’t move ahead with what was floated in the cultural conversation around potentially removing all flavours, bar three. The important thing to us is that there were limits to access, particularly for younger people. But for those who were getting off of tobacco smoking and moving towards vaping, if it was a certain flavour that got them on board with that, then they should still be able to go and purchase and utilise that through a specialised shop.

So I think the other really critical thing to speak to here, and what some have conflated this conversation around vaping regulation with, is the number of deaths that have occurred overseas, particularly in the United States. It’s important that we put on the record that all of those vapes that were associated to those deaths and to those illnesses—colloquially known as “popcorn lung”—are vapes that came off of the unregulated black market. That is the importance of regulation here. This experience that we’ve seen, with vaping moving towards self-regulated kinds of standards, but also through the black market, to me really emphasises the importance of regulation and the consistency that we should have around a harm reduction approach when it comes to all substances. I’d like to say that the Greens are probably the party with most coherent kind of approach to all substances—that being that we would like to see similar kinds of standards applied to alcohol, with regard to the reduction or complete removal of the ability to advertise and sponsor. I’d love to see the major political parties in this place take up that mantle, particularly given that it was work progressed under the former National Governments, which they kind of dusted under the rug, but, again, I digress.

What we know—and this is research out of the Global Commission on Drug Policy, which canvasses both licit and illicit substances—is that you see the peak in societal harm with the use of a substance when the supply of that substance is controlled either by the underground black market under a complete prohibition, which is what happens when we force substances or practices underground, or when you have a complete free market; that being complete corporate control. In both of those instances, in both of those polar ends of the spectrum, you have entities that have an incentive to exploit vulnerable communities in order to make a quick buck. So what we’re trying to do here is to narrow that spectrum away from those extremities and to introduce regulation that reduces access, reduces harm, and changes the cultural conversation.

So I’d invite any New Zealanders who are interested in this conversation to submit before the select committee. We are really looking forward to watching how this progresses. It’s been fascinating watching, in particular, regulation unfold in the United Kingdom, who jumped on this quite a while before us—about a decade ago, I believe. They have put forward some really meaningful approaches, which we’ve adopted, actually, in this legislation—including the ability, I might add, for health practitioners to give advice and recommendations about vaping products to a patient or client who is looking to move away from tobacco smoking.

The bottom line should be that we are not trying to create a new big tobacco market. We are not trying to create a new addictive substance that can cause more harm in our communities. We are trying to offer sensible regulations for tobacco smoking cessation, and at this point in time, the Greens think that this bill strikes the right balance. Looking forward to hearing from members of the public. We are proud to support this legislation.

DAN BIDOIS (National—Northcote): It’s a pleasure to take a rise and speak to the first reading of the vaping regulation bill. May I start out by saying to this House: what has taken us so long to get here? We gave this House everything, and I’d like to acknowledge the Hon Nicky Wagner. How good is Nicky Wagner, everybody? She did a tremendous amount of work to research and put a law together in the member’s ballot 2½ years ago. And what has this Government done since then on this issue? Nothing. And it is appalling, that we are here 2½ years later, where the public of New Zealand and the sector itself have had no certainty over the regulations for the sector. It is, frankly, appalling that it has taken us so long to get here today, not to mention the harm that is being caused, potentially, to our youth in New Zealand, but also to the business sector. I come from an area of Northcote, and there are many businesses, and some who have gone out of business because of the lack of certainty and the threat of regulation over this sector. I welcome the opportunity to vote in favour of this law, but it is frankly appalling that it has taken us so long.

From where I sit, the benefits of vaping are becoming clearer by the day. It is a fantastic cessation tool. I must disclose that I have been a smoker in the past. I’m not proud of it. Thankfully, I haven’t smoked a cigarette in quite some years. This is a bill that will do a tremendous amount of work to those remaining 16 percent, 17 percent of New Zealanders who are smoking, and will help them, in fact, transition away from this terrible product.

It’s also going to help us achieve our 2025 smoke-free goal. I want to acknowledge that it is an aspirational goal. Whether we get there will depend on the success of initiatives like this but, certainly, we all remain committed to this.

But I also want to talk about the economic opportunities of this legislation, and what it will do to give certainty to those who are manufacturing, supplying, or selling these products to New Zealanders, and talk about the economic job opportunities as a result. I must say, I’ve got scenarios in my own community of Northcote of businesses that have bloomed because of the rise in vaping in New Zealand, but they need the certainty to know that this is done in a way that is consistent with the law, and therefore this law is important.

Research backs this up, that there are fantastic benefits. I want to call out the work the Cancer Society has done for researching this and providing us, as parliamentarians, fantastic resources to research the extent of the benefits, but also some of the costs as well from vaping. Some of those costs are very clear. While it is a good cessation tool for some, on the flip side it also has the potential to actually have a gateway effect for our youth, which is why, in fact, this law is so important, to provide safeguards, and to actually say, “Look, if you are under 18 and you want to vape, don’t vape. You cannot vape in this country.”

National is a fan of sensible regulation. We’re not a party of unfettered access to products. Well, even people like Adam Smith would appreciate regulations, because regulations essentially allow the playing field to work in a sensible manner and allow businesses and agents to get on with the practice of doing their transactions and business in a legal matter of fashion.

But I must come back to the point. We are here after two years of inaction of this Government. It is appalling that now we are here, 2½ years later. We are 2½ years behind the ability to actually have this in our society. We are 2½ years down the road of potentially harming our youth, providing uncertainty to businesses, and it is now incumbent on us to ask ourselves, “What is the correct process for this bill to go in?” I know we’re going to come to that very soon, but it is very concerning that now, six months before an election, 2½ years after sitting on their hands and doing nothing, this Government now wants to rush this legislation through.

I do raise this because there are a lot of people that we’d want to hear from in the select committee process. Just to disregard the constitutional arrangements that we have, in order to fit the Government’s time line to get this through so that they can go out there and say, “Look what we’ve done on vaping.”, is, I think, irresponsible and poor policy-making in New Zealand.

I look forward to hearing from the vast array of people that this law will affect, people like children. How is it going to affect them? You know, I talk to kids in my electorate of Northcote. School principals—really want to hear from a vast array of school principals about how this law is going to work. Vaping firms—I’m really keen to hear from them around how we can encourage job opportunities at the same time as addressing some of our health concerns. Researchers and organisations like the Child Cancer Foundation and the Cancer Society—I’m really keen to hear from them about the most up-to-date research that has been done on the positive effects and the negative effects of these products.

Things like flavours—that’s one thing that I think we should discuss in select committee, which is what are the effects of flavours. Actually, do we need flavours or do we not? I’m agnostic on that question. I just think it is incumbent on us as good policy makers to have a robust debate around subjects like flavours. That requires that the select committee process be, in fact, consistent with all other laws that we’ve been talking about here since I’ve been a parliamentarian.

So we support this bill. We support the work that the Hon Nicky Wagner has done, the hard yards to get this law together. We look forward to discussing in select committee some of the nuances of it. There are parts of Nicky Wagner’s bill that haven’t made it into this draft law around things like child protection. Back when I was a teenager and going on to the fields at Howick College and smoking cigarettes, we had these child protection devices on things like lighters, so it seems rational that we ought to actually think about what are the protections that we should put in place to protect the youth of today and tomorrow.

It is far time that we discussed this law—

David Seymour: Far time.

DAN BIDOIS: It is beyond the right time to discuss this law. I’m so excited about this law and the fact that it has taken us 2½ years that I’m making slight grammatical errors in my speech. But what I want to say is this: this is fantastic that today we are discussing this law. It is, in fact, sad that we are discussing it today, two years after than we should. So we support this legislation to select committee. We do not support any shortening of the process. We want to hear from the correct and full amount of people that wish to submit. We’ve got to get this right. Good policy-making requires that we hear from everyone that this bill affects until we get it right, until we put in the nuances in this legislation. We support it to select committee.

Dr DUNCAN WEBB (Labour—Christchurch Central): Tēnā koe, Mr Speaker. There was a lot of second-hand smoke in that speech then. Going around once, twice, three times, I think.

Look, this is a great piece of legislation. It’s timely to move on. There are a lot of unknowns in respect of vaping, and that is one of the gaps. That is why we need some good regulations around it, to empower the Ministry of Health to take the right steps when we get the facts around it.

We know we need limits on advertising. The Attorney-General’s opinion gives us some views on that. I know the select committee will look very carefully at striking the right balance between freedom of speech, use of intellectual property, and ensuring that we don’t have the sale and unfettered advertising of dangerous products. There is work to do. The select committee is well placed to do it. I commend this bill to the House—a great piece of legislation.

AGNES LOHENI (National): Thank you, Mr Speaker. It’s a pleasure to make a contribution on this, the first reading of the Smokefree Environments and Regulated Products (Vaping) Amendment Bill. It’s a much awaited bill, and, as with all bills that come before us in the House, it’s incumbent on us as legislators to make sure that what, I guess, our mission is in terms of the outcomes for this piece of legislation meets the expectations that New Zealanders have on this bill—on vaping.

With regards to vaping, I do support the use of vaping as a tool for smokers to get off smoking. It’s something, actually, that I didn’t know much about, and I was pleased that we had Hāpai te Hauora, who invited MPs to a breakfast session in Parliament last year to discuss this very topic. So I went along, because I didn’t know much about vaping, and was pleased to have a very good session. We had people in the policy area and research, but more memorable for me on that particular session were a couple of women who gave very personal testimonies around their journey with smoking and the challenges they’ve had in trying to quit smoking. So to hear from them their personal experience around how vaping has been a real game-changer for them in getting them off tobacco and into something that is less harmful, but also more cost-effective. So I want to acknowledge Hāpai te Hauora for the work that they are doing in that space.

I also want to say that we are here, ultimately, to make sure that we have got better health outcomes for our communities. The other side of that coin here is that we have had parents and teachers and principals who have been fairly vocal about the lack of any regulations and guidelines on vaping, particularly in terms of our young people and our teenagers. So that, as I say, is pleasing that this bill has finally arrived. So I say mālō ‘aupito to the Minister Jenny Salesa, but I also want to acknowledge—as has also been mentioned by my colleagues here—the work of the Hon Nicky Wagner in this space.

I’d also like to say that even though there has been quite a significant delay in getting this bill to the House, I do urge the Government members that it would be really important that we get the settings right in this bill and that we do allow a full select committee process so that we can hear from the organisations, the families, the teachers, the parents, and men and women like the ones that I heard last year, who talk about how vaping has been an important measure for them.

One of the things I do note is that one of the women talked about flavours. As a parent with children, when we hear “bubble-gum”, that evokes a sense of something that is targeted to children, but this woman spoke about how particular flavours were a key part of vaping for her. So I think that engagement around flavours is an important one. I do note, I think, in Part 4 of this bill that one of provisions there is around generic retailers that are not specialist vaping shops—they would only be able to sell tobacco, menthol, and mint. So I think it’d be good to allow a full discussion around how flavours impact this as well. I’m pleased that this bill is here and I commend it to first reading. Thank you.

DAVID SEYMOUR (Leader—ACT): Thank you, Mr Speaker. I rise on behalf of ACT in opposition to this bill, but there’s one part that ACT could have supported, and that is the restriction on the advertising towards and the sale to minors of vaping products. In the Epsom electorate, principals of our schools are beside themselves at kids getting access, perfectly legally. We have stories about people in the back alleys of Newmarket with suitcases of vaping products that they are selling to kids legally. This Government for two years has done nothing about it. Stunned like possums in the headlights, they haven’t been able to do something as simple as banning the sale of vaping products to children and the advertising targeted at children. If they were to bring forward a bill like that, I’d vote for it and I’d support them rushing it through select committee to get it done as quickly as possible, but that’s not what they’re doing. They’re doing the worst of all worlds.

You see, vaping is one of greatest—in fact, probably the greatest—success story in ending smoking: one of biggest killers in our country. Except, and here’s the problem, vaping has been a private enterprise success story, and this Government can’t handle that. If people doubt that vaping is saving lives, let me recount a conversation on a plane with one of New Zealand’s foremost public health experts from the University of Auckland. I asked him, “Well, honestly, what do you think about vaping? Is it really safe or is it really saving people’s lives?” And he said, “Well, last year in the United States, 400,000 died from tobacco and one person died from vaping, so what do you reckon?” I thought he put it pretty clearly. Of course, he’s backed up by the evidence that vaping is saving lives, because it’s the nicotine that addicts people, but it’s the tar that kills. Because vaping does not have tar in it, it is saving people’s lives when they satisfy their nicotine addiction by vaping instead of tobacco. That’s the right thing to happen.

What does this legislation do? Well, it restricts the advertising and it restricts who can sell flavoured vapes. It makes it harder for people to find out about and access vaping that is safer than the smoking and the tobacco that’s killing them.

I met another man recently—a man from China, originally—who had a job he didn’t like very much, and he thought, “I’m going to promote vaping within the Chinese community.” Well, within a year he had helped 15,000 people convert to vaping. How many bureaucrats in the Ministry of Education have helped 15,000 people in an ethnic minority quit smoking in a year, and do it while making a profit? I think I know the answer to that—not many, if any. This is private enterprise helping people be healthier, and what this Government is doing is banning people from being able to advertise their wares and access people who need help and promote their product. How are they going to do it? How are they going to manage which stores can sell flavours? Presumably the Government is now going to have some sort of taste testing regime or some sort of regime for measuring the amount of flavour in a particular liquid—that’s the only way they can do it. So we see even more bureaucracy that is not going to make people safer.

In actual fact, it’s going to stop people from entering into contracts to buy things to make their lives better. It’s actually going to make people less safe, and people are actually going to die as a result of continuing to smoke, when they might have found out about and accessed vaping, which is safer. All of that occurs after two years of delay and this Government failing to introduce very simple laws and regulations that would have said, “If anyone sells or advertises vaping products to kids, then they will be prosecuted and fined.” The Government should have said, “Don’t be surprised if it uses mystery shoppers to catch them.” That’s what this Government should have done about the problem of children vaping, but, unfortunately, it hasn’t. Instead, it is going to stymie private enterprise efforts to save people’s lives. What a great shame. I’m proud to oppose this bill. Thank you, Mr Speaker.

Hon MAGGIE BARRY (National—North Shore): Mr Speaker—

David Seymour: I raise a point of order, Mr Speaker. I didn’t want to give him the pleasure of being in the Hansard of my speech or interrupt my flow, but Andrew Little was insinuating—

SPEAKER: Order! Order! The member will resume his seat. The member knows that points of order are to be raised at the time. They can’t be raised afterwards. Maggie Barry.

David Seymour: Mr Speaker—

SPEAKER: Maggie Barry.

Hon MAGGIE BARRY: Thank you, Mr Speaker. I rise to speak at the first reading of the Smokefree Environments and Regulated Products (Vaping) Amendment Bill. Naturally—and as my colleagues have already said very eloquently—National does support this bill. It was conceived and worked through over many years of hard work by the Hon Nicky Wagner, and this is a piece of legislation that should have been before this House many, many months ago.

In my electorate, Professor Beaglehole lives, and we have had many meetings on the North Shore discussing the merits of vaping, the efficiency of that method to wean people off nicotine and harmful cigarettes. It has been proven to succeed. It is something that I’ve had a lot of discussions about and I can really see that it will help people give up smoking, and it will also help us in our aim, as a country, of achieving smoke-free status by 2025. These are all very good things.

The vaping industry is really big business. The global market for vaping products in 2015 was estimated at around about USD $10 billion. The United States not surprisingly, perhaps, has about 56 percent of that market, and there’s 12 percent by the UK, and in varying degrees through the rest of the world. We don’t know, in New Zealand, how much vaping has taken off and is being used because we don’t have any real estimates or even guesstimates about the size and the value of that New Zealand market. The Ministry of Health has sought information through the consultation process that was held a couple of years ago, but the information still hasn’t given us much of a sense of where the market is at. So I think that the select committee process is the appropriate place to tease that out. It is disappointing that the Government is not going to allow more time for that process because I think that this is an argument that is going to be quite subtly nuanced.

There’s a lot of people who are uneasy about the way that vaping might appeal to young people, in particular—others have spoken of that. In my North Shore electorate, I know that there are a number of shops that are deliberately designed, it would seem to me, to be appealing to young people. They’re brightly lit, convivial atmospheres, people go in there—young people in particular. I’ve had discussions with my school principals at intermediate and primary school level about their unease about having vaping equipment and vaping being used by very young people—this is under the age of 10. So that to me needs to be very carefully controlled, thought about, and, ideally, stopped altogether. This legislation, obviously with its R18 element within it, will go some way towards doing that. The natural appeal of these places and the flavours and the things that we, perhaps, as older people don’t quite understand are triggers for young people, do need to be carefully thought through and talked through at length, I would suggest, at a select committee level.

For the smoke-free in cars legislation—which we were speaking of earlier in this House this morning—we had had some exposure on the Health Committee to discussions from young people about that attraction and the flavours and the colours and the general kind of grooviness that vaping seems to have already established in the hearts and minds of some of our young. We need to be incredibly careful about that, and it will be big business. So the regulations that have been, as I said, carefully thought through, the elements within this bill by the Hon Nicky Wagner, I think, will help. So the R18 element—allowing health professionals, as well, to give guidance to people who come to them for smoking cessation; it is entirely appropriate to have conversations with your GP in the privacy of a consultation to establish, you know, how people can transition out of smoking, and using vaping as a very successful tool in that. So, of course, we support that.

Ensuring that there are appropriate rules around advertising—people have spoken of this before. Again, I think it’s something that will come through very strongly in the select committee process and it’s something that we, as legislators, need to pay particular attention to. We need quality standards. It is not appropriate to have a whole variety of oils with different titrations within them of the nicotine element. I think it needs to be very apparent. Ideally, standardised systems will be less confusing for people who want to transition out of smoking and into vaping.

I think it is really important that the Ministry of Health has a role to approve the products. They are the appropriate place to look at the products, assess them as being fit for purpose and for sale, and also to prohibit vaping in smoke-free areas. Politicians travel a lot on aeroplanes; we are told very clearly not only is it a smoke-free place for cigarettes but also vaping is not allowed. It doesn’t seem to me that we’re too far away, as a nation, from getting people to acknowledge that vaping with—you know, it seems to me, as an observer—a heck of a lot of white smoke is not appropriate to do in confined spaces. The laws that already govern our smoke-free workplaces and restaurants, cafes, and so forth, I think should equally apply to vaping. If there are some exceptions, that will no doubt come out in that select committee process.

I’m not quite clear why some of the other measures that the Hon Nicky Wagner put forward have not been included, including that vaping products be child-resistant. My colleague Dan Bidois in the neighbouring electorate of Northcote has already confessed that when he was a young person and smoking, he did find that the cigarette lighters with the child-proofing on them, you know, were there as a barrier. Of course, being a smart young fellow I’m sure he got around it. But I don’t know quite why we would not use anything that would be child-resistant for a vaping product. Also the refilling without leakage—you know, apparently it’s a fairly messy process. I would have thought as a practicality that something that could be incorporated—and the refillable vaping tanks to a capacity of 2 millilitres; I think restricting it makes some sense. But, again, this is something that would be better discussed at select committee so that we can arrive in the right space on this.

The other element that was in the Hon Nicky Wagner’s bill but not in this one is requiring vaping products to deliver this consistent dose of nicotine under normal conditions of use. Again, I think that consistency, standardisation, all of these matters, would be prudent for us as lawmakers to really get our heads around so that when this piece of legislation, which has taken far too long to get to the House—and in the meantime a lot of people, I believe, have lost the opportunity to give up smoking by using the vaping tool. Again, I think of Professor Beaglehole, who has devoted a lot of his professional life to trying to encourage people to see the health problems with smoking. He is very much a fan of vaping. He feels that it is, as a transition tool, the best he’s seen in his, I think, 45 years or so in this space. I think the Cancer Society have taken on, as you would expect for such an organisation, a really strong educational role. They have talked in moderate language about the need to bring people with them and to transition out of smoking, but not to see vaping as something that’s cool, and, you know, another accessory for the bright young things. So I think that their carefully modulated message is something that we, as members of Parliament, and, certainly in the Health Committee, will take on board.

So this is a piece of legislation whose time has long come, and it should have been here a long time ago. We have offered to work constructively with the Government on this matter before; it is disappointing that they didn’t take us up on that offer and adopt the bill. As I said earlier, I think the political barriers that exist between parties and the lack of cooperation in sensible areas should have resulted in this coming to the House earlier, and for all of the work that was done by the Hon Nicky Wagner to have been available for the good of people’s health in New Zealand. So we support this bill and look forward to it coming to the Health Committee—which is, I’m sure, where it will go—and then to examine it in minute detail. Disappointing, again, that it is a truncated process because I think we have to get the detail of this absolutely right.

We have to refocus and perhaps use this as an opportunity to engage New Zealanders again in the 2025 goal. I think with the potential legalisation of cannabis—a referendum will decide that—and loose leaf being an enabler there, I personally feel it sends a very bad signal, potentially, for this country to legalise cannabis, to smoke it while we are working hard towards trying to get to a smoke-free 2025. This party would not ever support—well, it’ll be a conscience vote, but I would personally never support having loose leaf cannabis legalised. Shame it wasn’t looked at decriminalising it; that might have had a far more effective chance.

I don’t want to digress from the bill; I just cite it as something that has occurred. I feel that with the vaping we have an opportunity, because vaping actually is something—apparently in the United States, for example, cannabis and oils have been used to get high, so I would imagine that that part of the discussion may emerge at select committee. But vaping, as it stands on this bill, is very useful, and I think it will be a great addition to the suite of tools that we need to use, as legislators, to ensure that we are smoke-free by 2025 and that we help and protect the health of New Zealanders who are very keen to give up smoking, and vaping is an excellent tool, which is why I commend this bill to the House.

DAVID SEYMOUR (Leader—ACT): I raise a point of order, Mr Speaker. I in no way wish to trifle with or dispute your earlier ruling. However, I would ask respectfully that you reflect on, particularly, Speaker’s ruling 20/5. There’s a matter that arises when a member is on their feet speaking, is defamed in violation of the Standing Orders, and is required to interrupt their own speech to uphold the Standing Orders and defend themselves. I think it might be reasonable to consider that, as with Speaker’s ruling 20/5, one of the circumstances in which the Speaker might allow a person to raise a point of order at the conclusion of their speech is so that they are not disadvantaged by another member’s actions outside the Standing Orders process.

SPEAKER: Speaker’s ruling 20/3 is very clear; 20/5 does not refer to those circumstances at all. They refer to circumstances where, essentially, the Speaker has missed the point. The member should read the report of the select committee, of which I think he was a member when that matter was considered.

David Seymour: Well, speaking to that, Mr Speaker.

SPEAKER: No we’re not—

David Seymour: It’s not what 20/3 says.

SPEAKER: I have ruled.

David Seymour: Well, it’s not what 20/3 says.

SPEAKER: Sorry, you’re not sure what 20/3 says? The member should read—

David Seymour: I’m sure what it says. It refers to absence from the House.

SPEAKER: 20/3: a point of order must be raised at the time. That’s what it says, and it says it—

David Seymour: And it refers to—

SPEAKER: No, no. We’re not having a debate. I’ve read it to the member.

David Seymour: Read the rest of it.

SPEAKER: Does the member want to stay in the House for the rest of the day? Well, he’ll stop interjecting. [Interruption] He doesn’t care. Well, if he wants to go, he should.

MICHAEL WOOD (Labour—Mt Roskill): I stand to commend this bill to the House, to acknowledge the Government and the Minister for bringing what is an important piece of public-good legislation to our Parliament. I want to acknowledge, as well, the National Party for supporting it, for having a brief break from the bonfire of regulations line that they’ve been running the last couple of weeks, which has been called, by Matthew Hooton, a pig ignorant, populist, claptrap piece of politics.

I’m pleased that—

SPEAKER: Order! That’s not relevant. Joining other members’ irrelevancies is not the way of doing things.

MICHAEL WOOD: Thank you, Mr Speaker. Anyway, I want to acknowledge the cross-party support for this piece of legislation and the recognition that public-good regulation of this kind should be supported to support the health and wellbeing of New Zealanders. I also want to make the point that the Minister had done a very good job of preparing this piece of legislation in a careful way.

I want to point out that we are dealing in this area with an industry that, as has been pointed out, is highly commercial, is highly cashed up, and that, through the course of the legislative process and in the implementation phase, will do what it can to defend its patch. So it was the right and proper thing for this Minister and this Government to take a bit of time to make sure that the legislation that has been brought to this House is as tight as possible and can be implemented effectively without those kinds of problems being created. That’s what a responsible Minister and Government does. And that’s what we’ve done in this case. This is a good piece of legislation. It gets the balance right, and I’m very happy to commend it to the House.

A party vote was called for on the question, That the Smokefree Environments and Regulated Products (Vaping) Amendment Bill be now read a first time.

Ayes 119

New Zealand National 55; New Zealand Labour 46; New Zealand First 9; Green Party of Aotearoa New Zealand 8, Ross.

Noes 1

ACT New Zealand 1.

Bill read a first time.

Bill referred to the Health Committee.

Hon JENNY SALESA (Associate Minister of Health): I move, That the Smokefree Environments and Regulated Products (Vaping) Amendment Bill be reported to the House by 2 June, 2020; and that the committee have authority to meet at any time while the House is sitting (except during oral questions), during any evening on a day on which there has been a sitting of the House; and on a Friday in a week in which there has been a siting of the House; and outside the Wellington area, despite Standing Orders 191, 193 and 194(1)(b) and (c).

I want to very quickly set out why it is important that we have a shortened time for consideration of this bill at select committee. There are two clear pieces of feedback I’ve had on this bill. The first is that it’s vital that all New Zealanders have the opportunity to provide feedback, to ensure that we’re striking the right balance between protecting our kids, our tamariki, while at the same time helping our smokers who want to use vaping as a quit tool. That’s why the select committee process is so important. The second is that it’s time for New Zealand to have a proper regulatory framework for vaping in place, and that Parliament should work together quickly to get this done.

Let’s not forget that vaping has been in Aotearoa New Zealand since about 2008. This is yet another—

SPEAKER: Order! This is a very narrow debate, and the Minister is now going beyond it. It might have been relevant in the first reading debate; it’s not now. The history’s not relevant.

Hon MICHAEL WOODHOUSE (National): I am going to speak in opposition to this motion. It may be contradictory, or it may appear on the face of it to be contradictory to do so, given my criticism of the Minister and the Government for the time that it has taken to get the bill to this point. But for the purposes of this debate, I’m going to use the Minister’s own words.

There are five reasons why I believe that this motion should not be agreed to by the House. By the Minister’s own admission, she has said that this bill is complex. Even if we put aside the fact that she was handed a gift by the Hon Nicky Wagner, she took 2½ years to get to this point. She is now asking the select committee, the stakeholders, the officials, Parliamentary Counsel Office, and everybody else to do the work that she couldn’t do in 2½ years in three months. I find that highly, highly problematic for the democratic process.

The second reason why there should be opposition to this bill is that there are, despite the fact that there are very strong similarities between this bill and the Hon Nicky Wagner’s draft bill as a Minister and now her member’s bill in the ballot, there are actually significant omissions to it. I will not go through them; I did so in my first reading speech.

But there are things that could be made different in this bill with a robust select committee process that I submit is going to be compromised by the shortened report back. The third reason why this should not be approved actually goes to something that I disagree with the Minister on but agree with Michael Wood on—the lack of involvement in the preparation by the Minister and the Government from other stakeholders. Now, she has acknowledged that the people that assisted her in the preparation of the bill to this point were the Ministry of Health and Action for Smokefree 2025. Now, they are very good, important people to consult with in the preparation of good bills, but it’s very disappointing to note, firstly, that the Minister did not take up the invitation by the National Party to engage early so that we could be wholly over the detail in order that we could expedite the bill. We know this has got to get into law. It’s not about delaying this. It’s about actually getting good legislation, and Michael Wood actually said it all when he described the sophistication of the vaping lobby.

I have no time necessarily for big tobacco and a vaping lobby that’s going to use sophisticated techniques to get their own way. But in a democratic process, it’s absolutely vital that we see and hear from the people with whom we disagree, in order that we can have a robust discussion and make bills better. Now, we’re going to see them and hear from them—I have no doubt. But had the Minister engaged prior to this point, a three-month report back could well have been appropriate.

The fourth reason why I don’t believe this is appropriate is because of the Attorney-General’s advice that this is a breach of the freedoms that are set out in the New Zealand Bill of Rights Act that are not justified by the reasons that have been put. And again, I won’t relitigate why the Attorney-General has that. But we’ve got a very difficult job to do now.

If the Government, which was so critical of the Key-English Government for the times when it had New Zealand Bill of Rights Act vets that it did not agree with, and then passed legislation in the face of—and I say it wasn’t a unique thing; the Clark Government did that 14 times, by my count, in its years in Government, so it’s not unusual. But it does behove the select committee to listen very carefully, and indeed, the Standing Orders Committee, on this point, has heard submissions, including from the Clerk of the House, that there could perhaps be a different process under the Standing Orders for when a New Zealand Bill of Rights Act vet is tabled with a bill, in order for a greater level of scrutiny and at least the appearance of not riding roughshod over it—I don’t think that that actually happens, but it does behove us to be seen to be considering, and not only just considering, the Attorney-General’s advice.

That’s going to take some time, and we’re going to need to get some advice about that. It’s a very complicated position and a conundrum in respect of freedom of expression. The vaping industry, the very sophisticated industry that Michael Wood describes, is having its freedoms curtailed, and the Attorney-General is saying that’s not reasonable. We need to give them a fair hearing, lest there be the potential for a judicial review once the process is completed.

The fifth and main reason, I think, is that I get the feeling that the Government has forgotten that it is not the executive that passes laws in this land; it is this Parliament. It does so under a select committee process that is time honoured and very, very well followed, and this should be a business-as-usual process. It’s offensive to the select committee process, in my view, for such an important piece of legislation, that has nearly unanimous support across the House, to be treated so poorly. I’m a member of that committee. I’m looking forward to the discussion, the submissions, and the consideration. We work well as a committee, but we’re really, really busy, and in order to be able to consider this bill in the next three months, we are going to have to set aside other material business. We have something like 33 petitions before us right now. We have other legislation, the water regulatory bill, which was being considered yesterday.

Hon Nathan Guy: Yeah, what about coronavirus—that could mean something?

Hon MICHAEL WOODHOUSE: Exactly. Who knows what the Health Committee might need to deal with in the next three months, and to do it properly and diligently, what’s going to give? Are we going to come back to the Business Committee with a request for an extension, because the Health Committee has actually got itself deeply embedded in the role of protecting New Zealanders from a pandemic? And so the select committee does need to have a great deal more control, I believe, over its workload in the next three months.

This is a significant disruptor to that, and I cannot support it, and my colleagues cannot support it. And we know why we’re doing it. I mean, let’s be honest; there’s another date coming up soon. It’s about 196 days away. The Government does want to clear some important business, but it also wants to be able to go to the electorate and say, “Look what we did.” It doesn’t want other members of this House and new candidates to be saying they promised one thing and didn’t deliver it. So there’s an imperative that’s more than just policy. There’s a great deal of politics behind this motion. I understand it; I cannot agree with it. It is not for this House to allow the executive and the Government to curtail what is a very important process of developing and passing good law just by a vote on the numbers.

I’m disappointed. I know there are times when that’s necessary—this isn’t one of them. If the Minister had moved faster to get the bill before this House last year, we wouldn’t be having this debate. It is wrong and I oppose it.

DAN BIDOIS (National—Northcote): Mr Speaker, thank you for allowing me to have a call in this very narrowly defined debate, which is really about the report-back date for this bill. I rise to take my first ever call in a report-back debate, because I am shocked that in the interests of good policy-making, we are, in fact, shortening the report-back time line to within three months, I would like to remind this House—to 2 June.

As well as echoing the comments of my colleague the Hon Michael Woodhouse, I would like to just raise another point of matter around the industry and the way it’s changing. We’ve heard from the other side of the House how fast this industry is changing and how many products are coming out in the market. There’s research every day done to, you know, bust some of those myths around vaping and shore up exactly what the impacts of this legislation are, and particularly in the US. I just find that we ought to consider having the normal process in place so that we can get a fuller understanding of some of those changes and how they’re actually going to implement and have an impact in New Zealand.

So I think the way the industry changes is actually an argument against shortening this select committee process from six months to within three. Let’s get it right, because we don’t argue over the contents of this bill; we all want to see regulations for the vaping sector. We just want to make sure that it’s done right. I ask this House to reflect on why we have a six-month select committee process. We have that in the law and in our constitutional arrangements for a particular purpose: to make sure that this is a robust and full select committee process, and, Mr Speaker, I know you understand this very, very well.

Hon Tim Macindoe: Don’t bring him into the debate.

DAN BIDOIS: Not bringing you into the debate on this matter. But coming back to the point of this, the Hon Nicky Wagner put a member’s bill on the ballot in October 2018.

SPEAKER: Order! Order! The member will resume his seat when I stand up. The member spent quite a bit of his substantive speech off the topic and commenting on this issue. I’m taking that into account now and I’m going to hold him very tight to the topic. Historical matters are not relevant.

DAN BIDOIS: Thank you, Mr Speaker. Look, what I want to say is this. This Government is asking the House to shorten the select committee process from six months to three months when we’ve had 2½ years where we could have put this in place. And I just don’t think—

SPEAKER: Second and last warning.

DAN BIDOIS: —that the democratic processes should be curtailed because of the inaction of this Government.

You know, reflecting on the comments from the Minister around why they want to, in fact, shorten the process, those arguments were not clear at all.

Hon Nathan Guy: What were they? What did she say?

DAN BIDOIS: “It’s time”; that is what she said—it’s time.

Hon Michael Woodhouse: There’s always time; that’s why we bring bills in.

DAN BIDOIS: That’s right, and if we could wait as long as we have for this law, surely we can wait another three months to get it right. I ask this as a genuine question.

The other argument that was made is that the select committee process is important. Well, if it is important, why are we shortening it to three months? So it’s about the importance of getting this law right, because once we’ve got these regulations in place, it’s difficult to change them. So I would ask this House to reflect on why they’re doing what they’re doing. You know, there’s a quote that I like to say often: it’s not what’s often said that’s important; it’s what’s not said. And what was not said on that side of the House is the true reason they are considering reducing this report—

Hon Nathan Guy: What’s the true reason?

DAN BIDOIS: It’s because there’s an election on 19 September and they want to show that they’ve made progress on this, given that in the last—well, not reflecting on it but given that they haven’t actually made progress at all.

So I oppose this motion to reduce the select committee report-back date from six months to three months, and I would ask the House to reflect on this and to vote accordingly. Thank you.

Hon TIM MACINDOE (National—Hamilton West): Thank you, Mr Speaker. I want, at the outset, to endorse the five points that the Hon Michael Woodhouse made in opposing this motion. I intended to make three of my own, but I do want to draw the attention of the Government to the interjection that was made at the end of the Hon Michael Woodhouse’s speech, which I think the Government must answer, and I hope that the next Government speaker on his or her feet will do so, and that is: has there been consideration of the huge implications for the Health Committee of the coronavirus outbreak and the potential for an enormous extra workload that that committee will face? As they try to push for a truncated select committee process on this particular bill—

Darroch Ball: It’s not relevant—not relevant.

Hon TIM MACINDOE: I think I just heard Mr Ball say it’s not relevant. Is he seriously suggesting to the country—

SPEAKER: I apologise to the member for interrupting him. The time has come for me to leave the Chair.

Debate interrupted.

The House adjourned at 1 p.m. (Thursday)