Wednesday, 1 June 2022

WEDNESDAY, 1 JUNE 2022

WEDNESDAY, 1 JUNE 2022

The Deputy Speaker took the Chair at 2 p.m.

Karakia/Prayers

Karakia/Prayers

BARBARA EDMONDS (Labour—Mana): Tatou ifo ma tatalo. Le Atua Silisili ese e, matou te sulaina lau Afio mo fa‘amanuiaga ma tofi ua e fa‘au‘uina ai i matou. E lafoa‘i ni o matou lagona ma manatua ta‘ito‘atasi i le amana‘iaina o le Masiofo o Peretania. Matou te tatalo ina ia tonu ma fa‘amaoni fuafuaga ma fa‘ai‘uga uma i totonu o lenei Maota Fono. Ia talosia ta‘ita‘i o lenei Mālō ina ia maua le tōfā mamao, le fa‘apalepale ma le agamalū, auā le manuia ma le filemū o Niu Sila. O le matou tatalo lea, e ala atu i le suafa pele o Iesu Keriso. Amene.

PETITIONS, PAPERS, SELECT COMMITTEE REPORTS, AND INTRODUCTION OF BILLS

PETITIONS, PAPERS, SELECT COMMITTEE REPORTS, AND INTRODUCTION OF BILLS

DEPUTY SPEAKER: Fa‘afetai lava. Members, no petitions, papers, or select committee reports have been presented, and no bills have been introduced.

Oral Questions

Questions to Ministers

Question No. 1—Prime Minister

1. CHRISTOPHER LUXON (Leader of the Opposition) to the Acting Prime Minister: Does he stand by all of his Government’s statements and actions?

Hon GRANT ROBERTSON (Acting Prime Minister): Fa‘afetai tele lava. Yes. Today, the draft Advanced Manufacturing Industry Transformation Plan was launched at the EMEX trade show in Auckland. The advanced-manufacturing sector is not only our largest contributor to exports, accounting for 73.5 percent of goods exports; it accounts for more than 10 percent of both our economy and workforce. This plan works in partnership with business to increase investment in new technology and processes to lift productivity, exports, and wages; better support innovation, research, and development; and work to reduce waste and emissions, and attract and develop a diverse, high-skilled, and high-wage workforce.

Christopher Luxon: Can he confirm this Government has overspent every operating allowance it has set itself for five Budgets in a row?

Hon GRANT ROBERTSON: What I can confirm is the Government is invested in making up for the nine long years of neglect from the National Party, and the member might care to remember the arrival of a certain thing called COVID in the middle of all of that.

Christopher Luxon: Is it correct that this Government has overspent its operating allowances by an average of $2.7 billion per Budget and, if so, does he plan to overspend next year’s operating allowance as well?

Hon GRANT ROBERTSON: What I can confirm is that this Government has made sure that New Zealand has kept one of the lowest levels of public debt in the OECD, has been able to both run surpluses and, then, once we reached COVID, manage down deficits to a low level compared with the rest of the world. We’ve also seen strong average annual growth. Each year, the Government has to assess the expenditure that it needs to undertake, such as making sure that we invest in health, making sure that we invest in education. The outcomes matter, and New Zealand has one of the strongest economies in the world.

Christopher Luxon: Can he confirm reports that Government spending, excluding COVID support, has increased by nearly 10 percent per year between 2020 and the latest Budget?

Hon GRANT ROBERTSON: What I can confirm is that Government spending coming off the back of a one-in-100-year economic shock has been at around 35 percent of GDP. That is a very similar percentage to what the previous National Government did in the face of the global financial crisis, and in the Budget we have the projections we will return to around the long-run average of 30 percent of GDP.

Christopher Luxon: Why should New Zealanders believe his finance Minister when he promises to limit non-COVID spending increases next year to less than half of recent increases?

Hon GRANT ROBERTSON: My finance Minister is a modest person who wouldn’t want to blow his trumpet in the way that the member is inviting him to do. What we do know is that the IMF, the OECD, Standard & Poor’s, and Moody’s have all come, assessed the New Zealand economy, and said that we have come through COVID stronger than almost any other country in the world.

Christopher Luxon: Does he agree with economist Cameron Bagrie that this Government’s Budget documents “now face credibility challenges because spending projections are becoming ridiculously disconnected from recent spending reality” and, if not, why not?

Hon GRANT ROBERTSON: Again, the Government’s Budget is based on Treasury’s projections and forecasts, as every Government’s Budget has been in New Zealand’s history. We rely on those forecasts, and again, I repeat, our record coming off the back of these Budgets is that our net debt level is lower than almost any other country in the world, that we have had average annual growth over 5 percent, and that we’ve got unemployment down to 3.2 percent. If the member wants outcomes, those are good outcomes.

Christopher Luxon: How can New Zealanders have any confidence his finance Minister will be able to help himself from overspending next year, an election year, when he’s spent more than he said he would every year he’s been in Government?

Hon GRANT ROBERTSON: I’m really interested to note that the Leader of the Opposition’s definition on overspending is actually investing in a health system that delivers for New Zealand—is actually investing in an education system—and what we have from the Opposition is the continuation of the Bermuda Triangle, where they somehow think they can cut taxes, reduce debt, and increase spending. Just today, Mr Luxon said he wanted to increase defence spending. Where’s that money coming from, Mr Luxon?

Kieran McAnulty: Does he stand by this Government’s record investment in schools, which has recently funded a covered courtyard in Pahiatua School, who are with us here today?

Hon GRANT ROBERTSON: Yes, I do stand by that, and in fact, the excellent advocacy of the MP for Wairarapa was a significant factor in that occurring.

Question No. 2—Research, Science and Innovation

2. NAISI CHEN (Labour) to the Minister of Research, Science and Innovation: What action is the Government taking to accelerate innovation in New Zealand businesses?

Hon Dr MEGAN WOODS (Minister of Research, Science and Innovation): Last week, I announced two new competitive grants to support more innovation-led growth. Over the next four years, the Government will invest $250 million into supporting around 500 additional businesses. The New to R & D Grant will help to jump-start more businesses into R & D, and provide an on-ramp to the research and development tax incentive (RDTI). The Ārohia Innovation Trailblazer Grant will provide extra help with the cost of activities that don’t fall within the definition of R & D, such as precision manufacturing for robotics applications, or digital product development. When we introduced the research and development tax incentive, we said we would work alongside businesses to build additional support. We are delivering on that promise.

Naisi Chen: How has the introduction of the research and development tax incentive stimulated innovation in New Zealand?

Hon Dr MEGAN WOODS: Since we took office, the Government has partnered with innovative New Zealand businesses to help them thrive, including through the introduction of the research and development tax incentive in 2019. More than 1,500 businesses are enrolled in the RDTI, and it has generated over $788 million in private investment in R & D. There are now more than three times as many businesses being supported through the tax incentive as on the old Callaghan growth grant, and the uptake continues. Overall spending on business expenditure on R & D increased to $2.8 billion in 2021. This continues the trend of business spending—

DEPUTY SPEAKER: Order! The Minister has definitely answered the question.

Naisi Chen: How else is the Government supporting New Zealand’s innovators?

Hon Dr MEGAN WOODS: Last week, Minister Nash and myself announced a Startup Advisors Council to help identify and address the opportunities and challenge our high-growth start-up businesses. We will work closely with the council, chaired by Phil McCaw, to support often high-tech and rapidly growing businesses to generate significant levels of research and development, and to drive economic growth.

Question No. 3—Finance

3. DAVID SEYMOUR (Leader—ACT) to the Minister of Finance: Is he comfortable with New Zealand’s economic performance in comparison with Australia’s since this Government took office?

Hon GRANT ROBERTSON (Minister of Finance): Fa‘afetai tele lava. In general, yes. For example, since the September 2017 quarter New Zealand’s unemployment rate has fallen from 4.7 percent to 3.2 percent, compared to Australia’s unemployment rate of 3.9 percent. New Zealand’s economy in the December 2021 quarter was 11.8 percent larger in real terms than in the September 2017 quarter, compared to 8.7 percent in Australia. There is always more to do, but I’m satisfied with New Zealand’s economic performance in the wake of a one-in-100-year economic shock.

David Seymour: Can he really find comfort in those short-term measures, when the median wage in Australia has grown $6,600 a year more in Australia than for workers here since he became Minister of Finance in 2017; and if he can’t take comfort from those figures, was it a mistake—in hindsight—that this incoming Government in 2017 made a Speech from the Throne 4,465 words long, but mentioned productivity only once?

Hon GRANT ROBERTSON: What I would say to the member is that there are many different ways of measuring and comparing us. If we compare, for example, two indices that are similar—the Labour Cost Index in New Zealand and the Wage Price Index in Australia—over the period of time we’ve been in Government that’s increased 2.2 percent in New Zealand versus 2.1 percent in Australia. The Government is extremely focused on improving New Zealand’s productivity; it’s why we’ve invested in skills and training, it’s why we’ve supported research and development, and it’s why we’ve got alongside our partners across the world in terms of free-trade agreements, and we continue to build on all of those things.

David Seymour: Is he comfortable that inflation for the last quarter was 6.9 percent here compared with 5.1 percent in Australia, and that floating mortgage rates there are 2.59 percentage points lower than here, meaning an Australian with a half-million-dollar mortgage pays $249 less every week than a New Zealander with a half-million-dollar mortgage?

Hon GRANT ROBERTSON: Well I would note, actually, in the March 2022 quarter, for that quarter, inflation in New Zealand was 1.8 percent and in Australia it was 2.1 percent. I also note that the member’s advocacy of policies with respect to housing in Australia I presume must also include a capital gains tax, since they’ve got one.

David Seymour: Is he comfortable with New Zealanders paying 33 percent of their income in tax while Australians pay 29 percent in the year to June 2021, according to Statistics New Zealand and the Australian Bureau of Statistics using IMF methodology, meaning New Zealanders not only earn less but pay a significantly higher portion of their income in taxes?

Hon GRANT ROBERTSON: In fact, when we look at the OECD tax wedge which looks, obviously, at the impact of tax on labour income overall, New Zealand’s tax wedge in 2021 was 19.4 percent; Australia’s tax wedge was 27.1 percent. Again, I obviously note the member’s enthusiasm for policies from Australia, so presumably ACT will now advocate for a 45 percent top tax rate.

David Seymour: Is he comfortable that foreigners choose to invest 80 percent more per person in Australia than in New Zealand; and if he’s not comfortable with that will his Government get around to reforming the Overseas Investment Office so we’re not the fourth most hostile country in the OECD to foreigners who want to send capital and ideas for our economy?

Hon GRANT ROBERTSON: The Government has indeed reformed the Overseas Investment Act and we continue to have strong levels of foreign direct investment into New Zealand.

David Seymour: Is this Minister ever going to take responsibility for the fact that wages are lower, inflation’s higher, mortgage rates are higher, and yet the best he can do is blame the past, other parties, and cherry-pick figures to evade the real issue facing New Zealanders?

Hon GRANT ROBERTSON: What I will take responsibility for is a Government that has helped New Zealanders through a one-in-100-year economic shock, and seen us come out the other end with 3.2 percent unemployment, growth averaging over 5 percent, debt at one of the lowest rates in the rest of the world. There are all sorts of comparisons we can make between Australia and New Zealand, but for me, for one, I’m very proud of New Zealand.

Question No. 4—Social Development and Employment

4. SARAH PALLETT (Labour—Ilam) to the Minister for Social Development and Employment: Talofa, Mr Speaker. How is the Government supporting beneficiary sole parents through Budget 2022?

Hon CARMEL SEPULONI (Minister for Social Development and Employment): Talofa lava, Mr Speaker. Budget 2022 removes the discriminatory policy which saw families on a sole parent rate of benefit not receive the child support paid by the other parent. Instead, the child support was claimed by Inland Revenue. From mid-2023 child support payments for sole parent beneficiaries will be passed on directly to them by Inland Revenue and treated as income for benefit purposes. This will align with what already occurs for other partnered beneficiaries raising tamariki. It is estimated that 41,550 sole parent families will be better off with a median gain of $24 per week. Removing this policy will lift an estimated 6,000 to 14,000 children out of poverty, using the BHC 50 measure. It is also anticipated it will encourage more parents to pay child support as they know it will go directly to their children.

Sarah Pallett: Why is removing this policy so important?

Hon CARMEL SEPULONI: Removing this policy will provide more money to parents so they can provide more support to their children. There is also evidence from overseas suggesting that passing on child support can result in an improved relationship between the child and the non-custodial parent who makes the payment. This is essential in helping our tamariki have the best possible start in life. There will be 20,300 Māori who will be impacted by this change. The vast majority of them are Māori women—given that 88 percent of all sole parent beneficiaries are women. Overall this is a positive change which removes a policy which has unfairly discriminated against sole parents for decades.

Sarah Pallett: What feedback has she seen on the change?

Hon CARMEL SEPULONI: The move to make this change has received a lot of very positive feedback. This includes Dr Ang Jury, the CEO of Women’s Refuge, who said, “This is a positive move which has the potential to significantly benefit these women and their children.” Also, Children’s Commissioner Judge Frances Eivers said she welcomes it hugely and that passing on child support would help to reduce poverty and improve the lives of some of society’s most vulnerable. Overall, this is a long-overdue move, and I now look forward to introducing the legislation into the House to make this a reality.

Ricardo Menéndez March: Would the Minister agree with 63 percent of New Zealanders who believe that beneficiaries including sole parents receiving a main benefit should receive the $350 cost of living payment?

Hon CARMEL SEPULONI: What I agree with are the social services who I’ve had the opportunity to speak with over the course of the last two years, and particularly the last year, with respect to the number of families that they have been seeing who are on low to middle incomes and who they believe have received no assistance during this period, particularly as we’ve entered into this phase where because of international impacts or influences we’re seeing inflationary increases that are affecting the cost of living. We needed to move quickly to ensure that they were able to receive some support as well, and that is why we made the decision to introduce the cost of living payment in the way that we did.

Question No. 5—Finance

5. NICOLA WILLIS (Deputy Leader—National) (remote) to the Minister of Finance: Is he concerned to see ANZ’s Business Outlook survey showing business confidence at its lowest since April 2020, and does he agree with the BNZ that “the economy’s wheels are beginning to fall off”?

Hon GRANT ROBERTSON (Minister of Finance): Talofa lava. I have seen the latest ANZ Business Outlook survey which does indeed show that firms are concerned about the economic outlook, but it also notes that employment and investment intentions are holding up relatively well. The business confidence indicator is an assessment of mood but has tended to be an unreliable forward indicator of economic performance; better measures include employment figures and job ads, both of which have remained positive. As to the second part of the question, as I have acknowledged many times in this House, 2022 is a tough year and is a volatile and uncertain environment for businesses and households. Global growth has been revised downwards due to the Ukraine war, supply chain disruptions, and key trading hubs like China in the ongoing pandemic. BNZ’s economists note that these global factors are contributing to much of the negativity among business. However, New Zealand finds itself in a strong position as we deal with these challenges, including having record low unemployment, a growing economy, high export returns, substantially lower debt than the countries that we compare ourselves against, and triple A credit ratings from Standard and Poor’s and Moody’s.

Nicola Willis: Is he concerned that plummeting business confidence, reduced economic growth forecasts, and record-high inflation mean New Zealanders’ living standards will go backwards this year?

Hon GRANT ROBERTSON: As I’ve said on a number of occasions, we are concerned about the impact of rising global inflation, coming off the back of the COVID pandemic, on households and on businesses. It’s the reason why we’ve stepped up to support households in a targeted way and it’s the reason why we will continue to support businesses through this difficult period.

Nicola Willis: Did he see a BBC report with comments from a New Zealander named Harmony who has moved her family to Australia saying, “You can’t make a living in New Zealand. There is no living. You just go backwards.” and how many more New Zealanders does he expect will depart New Zealand this year in search of a way out of the cost of living crisis?

Hon GRANT ROBERTSON: In answer to the question: no, but what I can say is that New Zealand is among all countries in the world dealing with spikes in global inflation. In New Zealand, we have one of the strongest economies in the world, that has come through COVID well with low unemployment, and there are good prospects in New Zealand.

Nicola Willis: Isn’t Harmony correct to say New Zealanders are going backwards when, under Labour, prices are rising faster than wages and incomes aren’t keeping up with basic household costs?

Hon GRANT ROBERTSON: What we do know is that wages have run in front of inflation in the period leading up to this year, and in 2023 they will again run ahead. In 2022, it is a very difficult and challenging year and it is the reason why we have supported New Zealanders through the cost of living, both with the package on 1 April and the cost of living payment, and measures such as increasing the minimum wage—which the National Party oppose.

Nicola Willis: Well does he continue to believe his big-spending, high-regulation approach to the economy is working when ASB reports that, “The general explosion in costs, supply problems, difficulties sourcing staff, and squeezed profitability are all combining to push business sentiment to extremely depressed levels.”?

Hon GRANT ROBERTSON: As we’ve traversed many, many times, this is a global phenomenon of inflation coming off the back of a global pandemic. What New Zealanders know is that we came through COVID better than most, and, in fact, the ASB themselves said in the report that was released yesterday, “The economy has weathered the Omicron outbreak with far less disruption than COVID outbreaks caused in 2020 and 2021.” It is tough going for many businesses and households at the moment; that is why the Government is backing them.

Nicola Willis: Well, what responsibility, if any, does he take for failing to create confidence in this country’s economic prospects, and does he understand that Kiwis don’t want his excuses, they just want to see a credible path out of the cost of living crisis, not one that leads to Australia?

Hon GRANT ROBERTSON: What the New Zealanders are seeing from this Government is support through the cost of living pressures that they’re facing, with a cost of living payment, with the fuel excise duty being cut by 25c, with the half-price public transport, with the 1 April package that’s lifted incomes, with the winter energy payment. These are all practical things that we can do here in New Zealand, along with the announced reform to supermarkets to make sure that people are paying fairer prices. They’re practical things that this Government is doing to support New Zealanders through these cost of living pressures.

Question No. 6—Justice

6. GINNY ANDERSEN (Labour—Hutt South) to the Minister of Justice: Talofa lava, Mr Speaker. How has Budget 2022 strengthened New Zealand’s legal aid scheme?

Hon KRIS FAAFOI (Minister of Justice): Talofa, Mr Speaker. New Zealand’s legal aid scheme will be significantly strengthened with the investment of $119 million from Budget 2022. This means we’re helping 93,000 more Kiwis become eligible for legal aid, fulfilling our election promise to make improvements to our court system so everyone has appropriate access to justice. Legal aid is essential to ensuring equity in New Zealand’s justice system, and by making this investment we are ensuring people on low incomes are able to access justice.

Ginny Andersen: What further measures are supported by Budget 2022 to bolster New Zealand’s legal aid scheme?

Hon KRIS FAAFOI: Talofa lava, Mr Speaker, again. Budget 2022 will also provide funding to increase hourly rates for over 2,400 legal aid lawyers by 12 percent. This is essential for maintaining the legal aid workforce. We’re also increasing debt repayment thresholds by 16.5 percent from 1 January next year, relieving financial pressures for around 16,000 low-income and vulnerable New Zealanders per year. And we’ve locked in annual increases to both the eligibility and repayment thresholds for the next three years.

Ginny Andersen: How do these changes ensure the ongoing viability of the legal aid scheme?

Hon KRIS FAAFOI: The Budget 2022 investment change is needed so the legal aid scheme can keep doing what it was designed to do. Eligibility for this scheme had become outdated, while hourly rates for legal aid lawyers have remained static since 2008. The effect of this was New Zealand was running out of legal aid lawyers willing to do legal aid work. As the number and cost of legal aid cases are projected to grow, we must be able to fund them. Budget 2022 provides that funding to cover the costs of existing demand for legal aid services based on projections through to 2024-25.

Question No. 7—Health

7. Dr SHANE RETI (National) to the Minister of Health: Talofa, Mr Speaker. Does he stand by all of his statements and actions?

Hon ANDREW LITTLE (Minister of Health): Talofa, Mr Speaker. Yes. In particular I stand by the actions this Labour Government has taken to ensure that our health system is properly funded to provide quality care services to all New Zealanders when and where they need them.

Dr Shane Reti: When he said of the health system in February, “We are well prepared.”, can he explain, then, why a woman with typhoid is reported as being asked to sleep in her car outside Middlemore Hospital because of a lack of hospital beds?

Hon ANDREW LITTLE: One of the things, as the Minister of Health, I cannot do is inquire into the individual circumstances of individual patients, because that would be a breach of patient confidentiality. I have been assured by the Counties Manukau District Health Board that they treat all patients with respect and provide them with options, and I’m satisfied that the Counties Manukau District Health Board did all they could to ensure the right treatment was available to that particular patient.

Dr Shane Reti: Did Counties Manukau provide a vehicle as an option to a woman with typhoid?

Hon ANDREW LITTLE: As I said in my previous answer, I’m satisfied that the Counties Manukau health board, in providing treatment to this particular patient over a lengthy period of time, did all that was clinically and ethically required of them.

Dr Shane Reti: Does he think our international health reputation is damaged by reports of people with typhoid being asked to sleep in cars outside hospitals?

Hon ANDREW LITTLE: What I do think most people will do when they look at media reports citing anonymous sources is treat them with great scepticism.

Dr Shane Reti: Is his restructuring during a pandemic contributing in any way at all to Christchurch and Auckland hospitals reporting today that they are cancelling surgeries?

Hon ANDREW LITTLE: It is true that in this House you hear absurd things being said, including in question time, and that would be one of the more absurd ones. I’m happy to assist the member and point out that during winter time, the health system receives a spike in people with flu conditions, with respiratory conditions, and, more recently, with COVID, and part of the preparation that the health system undergoes is to foresee that and prepare accordingly. But the health system is typically put under pressure during winter time. It is under pressure now and it is coping.

Hon Grant Robertson: What support has the Minister seen for the health reforms from the health workforce?

Hon ANDREW LITTLE: Everywhere I go, members of the health workforce, right from senior clinicians to those in the front line and other roles, say this change is long overdue. They want to be part of a unified, well-coordinated, and, I might add, well-funded health system and that’s what they are getting under this Government.

Dr Shane Reti: Can you guarantee, then, that his restructure, which will begin next month, won’t make the current crisis in our health system even worse?

Hon ANDREW LITTLE: We have a health system that responds very well to the needs of New Zealanders but can do a lot better, and the changes that we are putting in place, subject to the passage of legislation that is yet to complete its journey through this Parliament, will make things a lot better in terms of the ability for health service providers to meet those needs consistently across the country and to improve the equitable supply of health services right across the country as well.

Question No. 8—Environment

8. Hon EUGENIE SAGE (Green) (remote) to the Minister for the Environment: Talofa, Mr Speaker. Thank you. Is dilution the solution to agricultural nitrate pollution, or is there a need to reduce nitrate leaching into groundwater in regions such as Canterbury to reduce risks to drinking water and freshwater from farmed areas?

Hon DAVID PARKER (Minister for the Environment): The Government is committed to promoting freshwater ecosystem health throughout the country, including in Canterbury. Our essential freshwater work programme was set up in response to poor environmental outcomes, including the effects of excessive nitrogen on aquatic environments. Under the 2020 National Policy Statement for Freshwater Management, councils are required to improve water quality to meet a range of water-quality indicators, including for nitrates. I suppose increasing the amount of water entering an aquifer could, theoretically, reduce nutrient concentrations in groundwater downstream of that point if the new water wasn’t, itself, contaminated by nitrates—but I’m not suggesting this is either a practical or desirable solution. Nitrate leaching into groundwater can be reduced through changing farm practices; we’re supporting farmers to do this through the development of a nutrient risk index tool, improvements to OVERSEER, and freshwater farm plans.

Hon Eugenie Sage: Is he concerned that intensive dairy farming in Canterbury is causing a significant legacy effect of nitrate contamination of groundwater and drinking-water sources, and, if not, why not?

Hon DAVID PARKER: Well, in respect of the effect on drinking-water sources, that’s an issue that falls to the Associate Minister for the Environment, Minister Allan. In respect of whether that breaches standards for consumption of drinking water, that’s a matter for the Associate Minister of Health. In respect of the broader issues as to whether there are environmental consequences from intensive dairying in parts of the country that still need to improve, then, yes, I agree with that.

Hon Eugenie Sage: What is the Minister’s response to research by Dr Mike Joy and others—

Nicola Grigg: Oh, “Mike Misery”—“Dr Mike Misery”!

Hon Eugenie Sage: —showing that dairy farming in Canterbury is expected to result in steady state nitrate concentration—

DEPUTY SPEAKER: Order! Sorry for interrupting the member, but interjections while a question is being asked is out of order. So please stop doing it. I didn’t catch all of the question, so if the Hon Eugenie Sage would ask the question again.

Hon Eugenie Sage: Thank you, Mr Speaker. What is the Minister’s response to research by Dr Mike Joy and others, showing that dairy farming in Canterbury is expected to result in steady state nitrate concentrations averaging 21.3 milligrams per litre in groundwater coming from farmed areas that renders much of that water undrinkable and impacts the ecosystem health of spring-fed streams?

Hon DAVID PARKER: I respect the role of science. Whilst I don’t always agree with Dr Joy’s statements, I agree with many of them and I thank him for his advocacy in these areas. I haven’t read that research, but if that was the effect, I would share his concerns.

Hon Eugenie Sage: Is he concerned that nitrate contamination was increasing in 47 percent of the 322 groundwater wells that Environment Canterbury monitored from 2010 to 2020, and, if so, is he confident that the current national direction is strong enough for Environment Canterbury to take all the necessary steps to control the land-use activities that cause this contamination?

Hon DAVID PARKER: The first point I would make is that there has never been a need for national direction in order for regional councils to do their job to stop improper levels of pollution adversely affecting the environment. So they don’t rely upon national direction to do their job; national direction does help them do their job and prescribes minima that would not otherwise apply.

Hon Eugenie Sage: What will he do to change business as usual and stop the increasing nitrate pollution of groundwater caused by the 629 percent increase in fertiliser use in New Zealand between 1991 and 2019, and the 82 percent increase in dairy cow numbers to 6.3 million cows over the same period?

Hon DAVID PARKER: In respect of the issues that the member refers to as to the very high increases in the use of synthetic nitrogen, we’ve already moved to take the top off that by introducing a per hectare annual cap of synthetic nitrogen application that is legal. That limit is set for review in about two years’ time, but, for the first time in the history of New Zealand, we’ve already got one.

Hon Eugenie Sage: Will he consider reducing that regulated 190 kilogram per hectare cap on synthetic fertiliser use to help reduce dairy cow numbers and the amount of urine causing nitrate pollution of groundwater and spring-fed streams, and, if not, why not?

Hon DAVID PARKER: The review of that level implies that those issues would be considered at the time of the review.

Question No. 9—Transport

9. TĀMATI COFFEY (Labour) to the Minister of Transport: Fa‘afetai, Mr Speaker. Manuia le aoauli. What action is the Government taking to regenerate New Zealand’s coastal shipping sector?

Hon MICHAEL WOOD (Minister of Transport): Last week, I announced the selection of four preferred suppliers which Waka Kotahi will work with to invest in new and enhanced coastal shipping services around the country. Each of the four suppliers will bring at least one additional coastal shipping vessel into service, meaning that the Government and industry will be investing over $90 million together to unlock marine transport opportunities and grow our use of the blue highway. By investing in coastal shipping, we’re reducing emissions from the freight sector, providing greater resilience for our supply chain, and also improving employment opportunities for mariners and supporting regional development. This investment is a win for resilience, a win for the climate, and a win for regional New Zealand.

Tāmati Coffey: How does this futureproof New Zealand’s national supply chain?

Hon MICHAEL WOOD: Events like Russia’s invasion of Ukraine have shown New Zealand’s vulnerability to supply chain shocks, which are felt more acutely at our end of the supply chain. Investing in alternative modes of transport in the freight sector provides more options for goods to get to where they need to, and, in doing so, helps to keep downward pressure on costs that are ultimately paid by the consumer. Regional New Zealand also stands to benefit, with Nelson, New Plymouth, the East Cape, and the West Coast, amongst others, gaining new and enhanced coastal shipping services.

Tāmati Coffey: How does this initiative contribute towards New Zealand’s goal of net zero carbon emissions by 2050?

Hon MICHAEL WOOD: Once fully operational, this initiative is expected to remove around 35 million kilometres of truck travel from New Zealand’s roading network every year. In the emissions reduction plan, we have introduced a target to reduce emissions from our freight sector by 35 percent by 2035. Growing our coastal shipping sector will be critical to helping us achieve this target and this investment marks an important step on that journey.

Question No. 10—Police

10. Hon MARK MITCHELL (National—Whangaparāoa) to the Minister of Police: Why are firearms prohibition orders still not in place despite Police recommending them in October 2017?

Hon KRIS FAAFOI (Minister of Justice) on behalf of the Minister of Police: Talofa, Mr Speaker. On behalf of the Minister of Police, since taking office, this Government has established the strongest firearms control regime in our country’s history. We have banned military-style semi-automatics, we have bought back over 60,000 prohibited firearms and magazines, we strengthened the fit and proper person test, toughened licensing rules, and introduced new penalties under the Act. This Government has also legislated for a new fit for purpose firearms registry, which has been fully funded and is now under development. On top of that, we will pass the Firearms Prohibition Orders Legislation Bill, which will be reported back to this House in August of this year. In the wake of the March 15 attacks, we prioritised these measures appropriately, and we stand resolute on our record on arms control.

Hon Mark Mitchell: What does she mean when she says, “The effect of the FPO will be tougher”, given it does not have or include warrantless search powers?

Hon KRIS FAAFOI: I think the member might want to have paid attention to previous answers around warrantless search powers. The Minister has made it quite clear that the Search and Surveillance Act has allowed the police to undertake over 700 warrantless searches as part of Operation Tauwhiro. It’s already happening.

Hon Mark Mitchell: So what is the legal test currently required for a search to take place in the Government’s Firearms Prohibition Orders Legislation Bill?

Hon KRIS FAAFOI: I think under the search and surveillance regime there, there has to be a suspicion that firearms might be present, or the suspicion of that. I notice the member was asking where the firearms protection orders are. As I’ve mentioned to the member, that bill will be presented back to the House in August of this year. I’d also point out to that member that the previous National Government promised firearms protection orders twice, in 2014 and 2016. It had nine years in order to do that, and they got nothing. I can guarantee New Zealanders that in August of this year—

DEPUTY SPEAKER: Order! The Minister has definitely answered that question.

Hon Mark Mitchell: Did the Government ever vote down any National Party members’ bills around firearms prohibition orders (FPOs)?

DEPUTY SPEAKER: I’m not sure the Minister has responsibility for that.

Hon KRIS FAAFOI: In some of those instances, the member who was responsible for those bills didn’t do their homework. Despite being helped by the select committee, that bill continued to fail to meet the mark, but again, I’ll remind the House of the National Party’s record on this. Back in 2014, when Michael Woodhouse said that officials were providing advice by the end of the year on options around firearms prohibition orders, what happened? Nothing. And back in 2016—

DEPUTY SPEAKER: Order!

Hon KRIS FAAFOI: —when Judith Collins said firearm protection—

DEPUTY SPEAKER: Order!

David Seymour: The Government—

DEPUTY SPEAKER: No—I’m still standing. The Hon Kris Faafoi will stand, withdraw, and apologise first. Then I’ll take the point of order.

Hon KRIS FAAFOI: I withdraw and I apologise.

David Seymour: The Government has no responsibility for voting on a member’s bill, and certainly not for any of the attacks on another party that we just heard from the Minister. He sounds like he’s out of his depth.

DEPUTY SPEAKER: Well, notwithstanding the last part of the point of order, I did at the beginning say “in so far as the Minister had responsibility”, however I probably should have ruled it out of order in the first instance, so that was my fault.

Nicole McKee: This question is in relation to the answer to the first question that the Minister gave. If Labour has introduced the toughest gun laws in New Zealand, why is it that gun crime is up 47 percent under Labour’s watch?

Hon KRIS FAAFOI: I will reiterate some of the measures that I mentioned in my initial answer. The fact that we will be having a registry available to know where guns are, as of June 2023, will allow us to track who has guns and, if they get into the wrong hands, what is the responsibility of the people to get there. We have taken measures since 2019 to make sure that we make our streets safer from gun crime. We’ll put our records up against the previous Government’s record any day of the week.

David Seymour: The question was about the effectiveness of the policies and the outcomes they’ve had. It wasn’t an invitation to repeat the same policies that the Minister listed in the answer to the question that the supplementary question was about.

DEPUTY SPEAKER: Yeah. None the less, it was addressed.

Hon Mark Mitchell: Will she, in light of the 12 gang-related shootings in the last week, put the Firearms Prohibition Orders Legislation Bill through the House under urgency; and if not, why not?

Hon KRIS FAAFOI: We acknowledge that there are difficulties that those incidents may have caused the people involved. I reiterate to the member that the bill will be back before the House once it comes out of the select committee in August. This Government will make sure that FPOs come into place. Despite the promises of the previous Government—twice—it never delivered.

Question No. 11—Health

11. CAMILLA BELICH (Labour) to the Associate Minister of Health: Talofa, Mr Speaker. How will Budget 2022 help strengthen eating disorder services?

Hon Dr AYESHA VERRALL (Associate Minister of Health): Eating disorders are one of the most serious mental health challenges a person can face. We have incredibly skilled specialists working to support people with eating disorders but there’s an increasing demand for their services, particularly from young people. Budget 2022 includes new funding of $3.9 million to expand and improve eating disorder services so that people can get the help they need. Eating disorders are an area of cooperation with the Green Party as part of our wider work with youth mental health, and I want to acknowledge the Greens’ mental health spokesperson, Chlöe Swarbrick, for her work on this issue.

Camilla Belich: How will this new funding be used?

Hon Dr AYESHA VERRALL: Improving eating disorder services is a priority for me, as Associate Minister of Health. This funding will mean we can hire more clinicians and treat more people. It will also be used to help address the current variability of services across the country. Once funding is fully rolled out, it is projected to support about 200 more people per year to get treatment from specialist eating disorder services.

Camilla Belich: Are there plans to expand peer support for people with eating disorders?

Hon Dr AYESHA VERRALL: Thank you—whenever I meet with people working in this area, I hear about the importance of peer support. Having people with lived experience available to work with people living with eating disorders can make a real difference. So we will also use the additional funding in Budget 2022 to look at the potential to further develop peer support networks.

Matt Doocey: What is her response to Eating Disorders Association New Zealand’s reaction to her funding announcement, “until the system is reviewed and changes are made, we risk throwing good money after bad and perpetuating the current sub-optimal outcomes for individuals and their whānau.”, and does she support the sector’s call for an independent review into eating disorders?

Hon Dr AYESHA VERRALL: It was on the basis of those concerns raised by eating disorder advocates, and awareness of the waiting times for specialist appointments, that we put this funding in place. As a part of the movement of the transition of this service to Health New Zealand, we will be having a look, overall, at the quality of services across the country.

Question No. 12—Health

12. RAWIRI WAITITI (Co-Leader—Te Paati Māori) (remote) to the Minister of Health: Talofa lava, Mr Speaker. Fa‘afetai i le Atua ua atoa nei le 60 tausaga talu ona tutoatasi Samoa. Malo lava, o le vaiaso o le gagana Samoa. Does he stand by his statement that “If we’re going to have a Māori Health Authority, I’m determined that it genuinely has the authority to really make a difference for Māori”; if not, why not?

Hon ANDREW LITTLE (Minister of Health): Yes.

Rawiri Waititi: How can he stand by his statement when the Government consistently blocked attempts at select committee to include greater recognition of Māori authority in the Pae Ora bill, such as acknowledging tino rangatiratanga and establishing a Māori Director-General of Health?

Hon ANDREW LITTLE: It’s a matter for the select committee to determine how it deals with the bill and the changes that it recommends back to Parliament. The bill has had its second reading and, today, Parliament will be able to examine closely the bill as it has been reported back from the select committee.

Rawiri Waititi: Will he support Te Paati Māori amendments during the committee stage of the Pae Ora bill to strengthen the Māori Health Authority’s powers, acknowledging tino rangatiratanga, and establish a Māori Director-General of Health; if not, why not?

Hon ANDREW LITTLE: No, I won’t be supporting the proposed amendments from Te Paati Māori. We do not want or need two directors-general of health. We have the Ministry of Health, which is headed by the Director-General of Health, and we will have Health New Zealand and the Māori Health Authority, who already have established a track record of working closely together. The Māori Health Authority will be supported by iwi Māori partnership boards whose membership will be determined by iwi and urban Māori. The Māori Health Authority Board will be the subject of advice from the Hauora Māori Advisory Council to the Minister. And so the input of Māori, I am satisfied, will be consistent with the Crown’s obligations under Te Tiriti o Waitangi.

Rawiri Waititi: Can you explain how the Māori Health Authority will have the authority to really make a difference for Māori, when in Budget 2022 it only receives 0.6 percent of the Vote Health budget, despite Māori making up more than 17 to 19 percent of Aotearoa’s population?

Hon ANDREW LITTLE: A number of points on that. Firstly, the funding in Budget 2022 for the Māori Health Authority was additional funding on top of what had been appropriated for the health reforms in Budget 2021. In addition to that, the current funding that DHBs and the ministry manage for funding kaupapa Māori health services will transfer to the Māori Health Authority. That’s roughly $1.2 billion over four years. And the third point I would make is that funding for health services in the Budget is funding for health services, not for any particular health entity, and it’s my expectation that, as Health New Zealand and the Māori Health Authority get to work on the health plan and work out the various activities that they will each undertake, there will be agreement over funding that the Māori Health Authority will have sole responsibility for to continue its commissioning work and also to grow and develop kaupapa Māori health services.

Rawiri Waititi: What is his response to the many Māori health experts who have come out since Budget 2022 to challenge Government on the Māori Health Authority being short-changed and that it will mean the health system will continue to fail at eliminating entrenched inequities in Māori health?

Hon ANDREW LITTLE: To the extent I’ve seen some of that commentary, my observation is that much of it is ill informed. And to the extent that I’ve seen well-informed commentary that takes into account the points I made in answer to the previous question, what I’ve seen is expressions of support for the Māori Health Authority and the new regime that the Pae Ora (Healthy Futures) Bill, if enacted by this Parliament, will herald.

Budget Debate

Bills

Appropriation (2022/23 Estimates) Bill

Debate resumed from 31 May on the .

DEPUTY SPEAKER: Members, when we were last having this debate, we were on the second of a split call. I call Tangi Utikere.

TANGI UTIKERE (Labour—Palmerston North): Talofa lava, Mr Speaker, and thank you. It’s a pleasure to rise and take a call in the Budget debate this afternoon. In doing so, can I acknowledge our hard-working Minister of Finance, Grant Robertson, for pulling together a Budget that seeks to secure the future for all Kiwis. While members on the opposite side of the House are not supportive of securing a future for all Kiwis, we certainly are.

Budget 2022 was pulled together in a difficult global environment, and if we look at the context beforehand I want to acknowledge the fact I was able to host the Minister of Finance and also the Minister for Social Development and Employment, the Hon Carmel Sepuloni, when they were visiting Palmerston North last week. As part of that visit we were able to meet with the not-for-profit sector, and specifically with the Palmerston North Community Services Council, an organisation doing fantastic local work on the ground. It represents more than 100 community organisations within Palmerston North, and they were so positive about the Budget—particularly, two things. One is the change to child support payments that Minister Sepuloni touched on in question time today, because it will pull between 6,000 and 14,000 children out of poverty. Also, when it comes to dental care, we’re providing increased provision, accessibility, and availability to dental grants for low-income families, and that is also something that was well received.

When we’re talking about context, let’s remind ourselves that this Government has delivered on increases in the 1 April package, increases to main benefits as a result of the recommendations from the Welfare Expert Advisory Group, increases to family tax credits, and increases to superannuation that will make a difference. Why will they make a difference? They will make a difference because they’re an adjustment and increase for an individual of $52 a fortnight and for a couple of $80. It’s not just tinkering on this side of the House but, rather, initiatives that are supported by local communities.

On top of that we can look at the reintroduction of the winter energy payment back in May, creating real opportunities and difference in supporting those on low incomes and also for our seniors. Half-price public transport fares are continuing, specifically also for community services card holders. In terms of context again, in my city and others, if you hold a Bee card like I do, if you jump on to our local service provider in the Horizons region in Palmerston North, you will pay $1. One dollar with a Bee card for that public service, and actually that’s less than some councils have charged for car-parking. That’s been delivered by a Labour Government—a Bee card for everyone in Palmerston North.

This is a fantastic Budget that we should all be very proud of. I am proud of the largest investment in health ever—over $11 billion. Members in the National Party are more focused on other priorities. They’re not interested in health. We don’t hear them talking about the spend in health. We don’t hear them being supportive of investment in health—rather, it’s under-investment on that side of the House. This particular investment from a Labour Government is aimed at providing better care at that primary and community level, helping and supporting our Māori and Pasifika community members, amongst others as well.

There has been investment in ambulance services—assistance for those first responders, those on the ground; the front-liners. We have added 61 motor vehicles to the fleet and 248 more crew members on the ground. Last week I had the opportunity to meet with local folk at the Palmerston North rescue helicopter. They will benefit from this Government’s additional investment of $90 million over four years. Listening to the difference that will make to not just my community but the regional community as well is something that I am extremely proud of.

I want to conclude my contribution this afternoon with two things. One is to say that I’m proud to be a member of the 11-strong Pasifika caucus within the Labour Party. Last week we took the opportunity to meet with communities in Auckland but also in the Ōtaki electorate as well, hearing about the difference that Tupu Aotearoa and STEAM academy funding will make for that community. The second thing is that I am so proud of the ongoing support for the Apprenticeship Boost funding. In previous general debate slots I have talked about that. I have talked about a local company, Norwood, in my city and I’ve talked about how valued that support was. What was exciting was the chief executive of that company, at their chamber of commerce lunch last week, was able to directly share with the Minister of Finance his appreciation for the support of the Government for the ongoing nature of that initiative. I am proud to commend this Budget to the House.

DEPUTY SPEAKER: This call is a split call. I call Penny Simmonds.

PENNY SIMMONDS (National—Invercargill): Thank you, Mr Speaker. After the Budget announcement, I had, along with colleagues, a Zoom meeting with a number of aged-care providers across Otago and Southland. These providers are at their wit’s end. This is a sector that has not been looked after by the Government’s so-called wellbeing Budget; it has provided no relief for that sector at all.

This is a big sector. They provide 36,000 beds across New Zealand. If you compare that with the public hospitals, they have 12,500 beds across New Zealand. Aged-care facilities range from small family-run, stand-alone businesses to large, publicly listed, collocated sites of care services and retirement villages. But be very clear: 50 percent are small, individual, family-run businesses, and this is a sector in crisis, both financially and related to that through the lack of registered nurses. This is leading to beds being closed; it is leading to whole facilities being closed. Registered nurses are being enticed to district health boards (DHBs) because of the pay difference, which is currently a $15,000 pay difference. The pay equity deal to be finalised will bring that pay difference up to somewhere between $23,000 and $30,000 per annum.

Now no one—no one—is disputing the nurses’ pay increases wasn’t needed; they are the hard-working backbone of our DHBs, and we welcome that their pay increases occurred. The problem is the Government has not extended an increase in funding to the aged-care sector to be able to match the funding or the pay of the registered nurses in the aged-care sector with the DHB, and so they are losing nurses week after week. They can’t put up their fees; the Government price caps what they can charge. So they are squeezed by no additional income, no ability to put up their fees, and this competition from the DHBs—that is taking our registered nurses out of aged-care facilities.

I’ve heard Government MPs say “big corporates should be cross-subsidising from the retirement village income.” Well, that misses the point that 50 percent of our aged-care facilities don’t have retirement villages attached, and those that do, they are running separate operations and there is no reason why retirement villages should be cross-subsidising our aged-care facilities.

The situation, as it is now, is that we have got beds and facilities closing. Over 700 have closed in the past few months; 180 beds in Otago and Southland alone have closed. Residents are being relocated some distance away or being put in hospitals. This is turning into a health issue. If we cannot take referrals for new patients from hospital or the community and we are moving aged-care residents into hospitals and out of care homes because there are no registered nurses available, we are creating a health problem.

If this keeps going—and the extrapolation from the sector is—this could get to around 5 percent of those 36,000 beds being closed. That’s 1,800 beds that could be taken up in our hospitals for people that should be in our aged-care facilities. This is going to cause a health crisis because this Government will not fund the aged-care sector appropriately to attract and retain registered nurses in the sector.

Our aged-care facilities are being put in a position where they must shift their residents out or they are putting these vulnerable citizens at risk. People who have worked hard, paid taxes, contributed to this country for decades are being put at risk by this Government by not providing sufficient funding for them to be able to keep sufficient registered nurses in the aged-care sector.

SIMON WATTS (National—North Shore): It is an absolute pleasure to take the final call on this Budget on behalf of the National Party, a Budget, this year, that represents Government spending in the region of $9.5 billion per year—$38 billion over the next four years.

This is a Budget in which Kiwis are going backwards. We’ve got a Minister of Finance who is absolutely addicted to spending, and Kiwis know it. Kiwis around this country, hard-working Kiwis, are suffering from a cost of living crisis, and you know what? The solution that this Government put on the table was a payment of $27 a week for a three-month period that you can’t even get if you’re on the average wage in this country—one block of cheese and one packet of Weet-Bix from the supermarket. This is a Government that is out of touch with hard-working Kiwis in regards to the cost of living crisis that they are facing and a Budget in which is spent the most amount of money out of any Budget in history. You would expect it would come up with some solutions, some substance to deal with the issues Kiwis are facing. But, no, this Government has squandered the opportunity and missed the potential that they could have created, and, as a result, hard-working Kiwis are paying.

The issue is we are now in an inflationary environment, at 6.9 percent, when the Reserve Bank had meant to keep it between 1 and 3 percent. This Government is spending like there is no tomorrow, and what is even more concerning is the New Zealand Institute of Economic Research in June said—and I quote—“signs that long-term inflation pressures are becoming unanchored”. For those at home, what that means is inflation is not going to magically disappear. Inflation is not a spike, as the Minister continues to say in this House.

Inflation is going to persist and inflation is going to be around, eating away at Kiwis’ back pockets and the money in it every single day, and the more that this Government spends—and the non-tradable inflation portion of that 6.9 percent is 6 percent. That is domestically driven inflation. This is not all because of global supply chain issues or the war in Ukraine, as this Government would like us to believe. No, they have some responsibility around this inflation level, and they need to take accountability for where this country is heading, because the reality is the gap between earnings and the costs that Kiwis are paying at the supermarket and at the pump is going up and getting wider, and there is no solution on the horizon in terms of how this Government is going to provide solutions around that.

Hard-working Kiwis who own a home are paying more in mortgage payments as their mortgages are starting to renew. Nearly 50 percent of mortgages will renew in the next six months, and the impact on the average mortgage for Kiwis of a 1 percent increase is $150 more that they will pay on their mortgage every single week. That is the reality of what Kiwis are facing and this Government has squandered an opportunity to deal with the underlying issues that we have within this economy and put money back into the hard-working Kiwis’ pockets that they so deeply need.

Mortgage rates are impacting the economy and hard-working Kiwis, and we’ve got a Minister of Finance—Grant Robertson—who is absolutely addicted to spending. I want to give you a bit of an insight in terms of what we can expect this time next year. When we are sitting, looking at where we are in terms of an economy, it is no doubt going to be in a significantly worse position than where we are today. The Government has only got around $2.5 billion to spend next year, and that is still a huge amount of money. But I can pretty much give some idea around the fact that I bet you that with this Minister of Finance, there are going to be more taxes for hard-working Kiwis, there’s going to be more debt in this country for a country that can’t afford it, and there’s going to be more Government spending. That is the reality of what we are going to face in 2023.

We’ve got a finance Minister that is addicted to spending, we’ve got a cost of living crisis, and we’ve got a Labour Government that does not understand the principle of prudent economic management. What Kiwis need is a National-led Government that has a plan in order to deal with the issues that we need to fight around inflation, a fiscally prudent Government, and I’m looking forward to 2023, when National is back.

DEPUTY SPEAKER: I call Kieran McAnulty. You’ve got about 3½ minutes.

KIERAN McANULTY (Labour—Wairarapa): Oh well, I’ll make them good, Mr Speaker. If anybody wants to see how disjointed the National Party’s response to the Budget has been, rewind Parliament TV and watch the last 10 minutes. We’ve got two members sitting right next to each other. The first five minutes says we need to spend more; the next five minutes says we’re spending too much. They are the Tweedledum and Tweedledee of politics in New Zealand, and that, I think, just sums it up.

What we have in this Budget is a Budget that delivers for Kiwis and plans for the future. Actually, I think this Budget is a Budget that delivers for rural New Zealand, because the money that is going into our health system will mean better services in rural areas, and what do they say? “No.” This Budget will deliver more police in rural areas. What do they say? “No.” That is how the National Party are trying to weave an argument for the New Zealand people. They’re trying to say that we’re spending too much, but they won’t tell us what they will cut, because the last speaker from the National Party, Simon Watts, said that they have a plan. Well, I haven’t heard it. All I’ve heard is whinging. Whinging about what this Government is doing. Whinging about our investments for the future, about our investments in climate change, about our investments in education—delivering for rural New Zealand. They say they don’t like it, but they haven’t come up with an alternative.

I’ll give the ACT Party credit: at least they’ve come up with an alternative. They’re up front with the New Zealand people; they have said that they will scrap the winter energy payment. When Chris Luxon was asked about that, what did he say? “I’m not going to say.” The ACT Party have said they’re going to scrap the first-home grant, which we have increased in this Budget. When asked about whether the National Party will support that, they say “We’re not going to say.” How can you take a party seriously when all they’re doing is whinging about a Budget that is delivering for New Zealanders—

Matt Doocey: What are you doing?

KIERAN McANULTY: —but refuse to bring up an alternative of their own? And I’m pleased that Matt Doocey is piping up right now—the ultimate whinger. The ultimate whinger that is constantly sitting there complaining that not enough is being done with mental health, but will not commit to doing more—it’s just complaining for the sake of it.

New Zealanders saw opposition for opposition’s sake at the last election, and they totally rejected it. As we get closer to the next election, my pick is they will reject it again—because the National Party cannot keep this dance up for much longer. They cannot criticise spending while promising to spend more. They cannot promise tax cuts while not telling us what they’re going to cut in order to pay for it. The New Zealand people are not dumb, they will see right through that. They will also see that this Budget actually delivers.

Take the cost of living assistance, for example—the exact thing that the National Party said they would deliver. This Government does it in a way that is more targeted, less inflationary, and actually helps the people that need it. What do they say? “It’s not good enough.” What will they say that they’d do instead? “Oh, we’ll cut taxes to those earning $180,000.”—how is that targeted? And when faced with the question of what would those earning $180,000 do with their tax cuts, Chris Luxon says, “Oh, they’ll probably save it.” How on earth is that targeted? How is that supposed to be a cost of living assistance when those that don’t need it are going to get it?

New Zealanders will see through that nonsense. They’ve seen this Budget. They’ve seen that we’re committed to the people of New Zealand, and they’ll see the National Party for what they are.

DEPUTY SPEAKER: I call the Minister of Finance, the Hon Grant Robertson—10 minutes in response.

Hon GRANT ROBERTSON (Minister of Finance): Thank you very much, Mr Speaker, and can I begin by thanking colleagues across the Chamber for their contributions in response to the Budget debate. I want to particularly acknowledge the contributions made by my colleagues in the Labour caucus. I have listened to them stand in this House and consistently be positive about our country and be positive about the security that we can provide New Zealanders.

These are tough times for many New Zealand businesses and households, and what those businesses and households know is that there is a Government that is backing them—backing them in exactly the same way that we did through COVID-19. I have had the privilege of going on the road after the Budget all around New Zealand, listening to New Zealanders and meeting with people to hear from them, and one of the consistent themes was the fact that people around the country are grateful for the fact that the Government stood alongside them through initiatives like the wage subsidy scheme, like the resurgence support payment, and like the small business cash-flow scheme. These are the things that got businesses and households through COVID-19. That’s because the Government backed New Zealanders: to give them cash flow and confidence, and those New Zealanders know that we will back them again as we go through this challenging year that we’re facing in 2022.

Putting this Budget together required a very careful balance of three things. The first of those is: supporting New Zealanders in the here and now, because the global inflation spike that we are seeing is affecting New Zealanders when they go to the supermarket and when they’re at the petrol pump. What this Government has done is respond with practical measures that actually address the issues where inflation is hitting and the causes of inflation, not the things we’ve heard from the other side of the House: the untargeted ideas that they have about tax cuts for those who earn more than $180,000, or somehow the idea that we could cut health spending and that would lower prices at the supermarket. That is the logic that we are hearing from the National Party.

Instead, what we have done is made sure that we are supporting people—in particular, with the cost of living: the payment that starts on 1 August of $350, or $27 a week. Here’s my prediction: the people who get that will think, “Thank you, that is actually a contribution. It’s not going to make up for every single thing that’s happening, but it is a contribution.”—and it is a lot better than 2 bucks a week that someone earning $40,000 would be getting from the National Party, while people earning over $180,000 would be getting significantly more.

It comes on top of the package on 1 April that lifted main income benefits. That means that this Government has lifted benefits in 2020, 2021, and 2022, and any crocodile tears from the National Party about what they would do for low-income New Zealanders—they need to remember that they opposed every single one of those increases, just like they opposed the minimum wage, just like they’re opposing the fair pay agreements. Anything that we do on this side of the House to lift the incomes of New Zealanders gets opposed by the National Party.

But along with that, we’ve extended the fuel excise duty cut, the road-user charges cut, and half-price public transport. I am very proud of the fact that this Budget means that half-price public transport will extend for community services card holders for ever. That is the beginning of the commitments that we’re making to make sure that New Zealanders are supported to make sustainable transport choices.

So supporting people in the here and now matters, and on Budget night, we did introduce legislation to stop the land banking done by the duopoly in our supermarkets, to make sure that competitors have the confidence that they can come in, and now the Government has come further forward with our responses to the Commerce Commission market study. This means that we’re opening up wholesale. It means that consumers will have transparency around prices. It means that suppliers have a guarantee of a code of conduct. These are the things that mean we will see competitors in our market and we will see fairer grocery prices: practical initiatives from a Government focused on supporting people with cost of living pressures.

The thing that we always need to balance alongside the here and now is how we invest in the future—how we invest in the economic security of New Zealanders—and as part of this Budget, the Climate Emergency Response Fund does a very important thing: it begins our journey to making sure that not only do we meet our net zero emissions goals but that we take the opportunities that come with climate again. Again, as I travelled around the country, I met people in Christchurch, in New Plymouth, and all over New Zealand who want to be a part of this, who want to be driving forward in the hydrogen economy, and who want to be making sure that our industrial plants are heated efficiently, because it makes economic sense as well as it makes environmental sense and it’s where the high-wage jobs come from.

In contrast, we hear from the National Party that “Yes, we support the goal; we just don’t support any actions to actually reach the goal.” As one of my former colleagues said, “All map and no compass.” That’s what you get from the National Party, because they say they support the goal, just like they did in 2016 with Paris, and, actually, they’re not prepared to take any actions to go towards that, whereas in this Budget, we have a significant package of initiatives through transport, through forestry, through agriculture, through economic development and industry, and through the wage strategy to actually get on top of that and create the high-wage jobs that we need.

Tangi Utikere mentioned this in his speech just before, but the fact that we are continuing to invest in the skills and the training of New Zealanders is significant in this Budget. The extension of the Apprenticeship Boost means another 36,000 New Zealanders will be able to stay in apprentices; 190,000 New Zealanders have been backed by free apprenticeships and free targeted trade training, and it won’t come as a surprise to anyone listening to this speech to learn that the National Party opposed that as well when we brought that in in July 2020.

Alongside that, the Budget lays out the plan for $61 billion of spending in infrastructure over the next five years in New Zealand. That is investment in transport. That is investment in housing. That’s building schools, that’s building our hospitals, and it’s building up all of the assets that New Zealanders will rely on to make sure that we can indeed be a more productive economy, a high-wage economy, and a low-emissions economy that provides economic security.

The thing that all Governments have to do is balance what we’re doing in the here and now—the future investments—with upholding our strong fiscal position, and this Budget does that. That has been reinforced time and time again by the OECD, by the IMF, by Moody’s, and by Standard & Poor’s. They’ve all said that the Government’s books are in good shape: surplus by 2024-25, five years after COVID came along, compared to six years after the global financial crisis for National. Debt is at 19.9 percent, one of the lowest in the world.

Yes, Government spending increased because we helped New Zealanders get through COVID. I sat in this House and heard National Party members say, “Spend more.” Now, they come in today and say, “No, no, no, you shouldn’t have done that.” Let’s be really clear: when they stand up and talk about the fact that the Government shouldn’t be spending this money, they’re saying to New Zealanders, “We wouldn’t have backed you with the wage subsidy scheme.” Now, they did at the time. They said that they wanted it at the time, but now they’re saying they wouldn’t—that is the real meaning of that.

We are bringing Government spending back down, as you would expect, once we get through that period. That requires a disciplined approach and a careful approach, and we have got that balance.

But when I take a step back from this Budget and the work that the Government has been doing over the previous Budgets that I’ve had the honour to present to this House, it is not just the fact that we are providing economic security and that we’re working towards high-wage jobs with low emissions. It is that we are genuinely involved in nation-building—nation-building that happens not only through the assets that we build, the infrastructure that we support, and the people who we develop the skills with but the way that we recognise where New Zealand is today, in 2022. So there is funding in this Budget for Matariki—the fact that we have an indigenous public holiday. There is funding in this Budget to recognise and reconcile from the Dawn Raids. We recognise that when we do well in New Zealand, we build a nation.

I look across the House to see a group of people who, once again, want to divide a nation. They think that tax cuts for those earning more than $180,000 is the way to be able to get a more fair and more equal New Zealand—that is rubbish. We know, on this side of the House, that the way we do that is that we invest in our people. We support those with the least so they can do more. We all have a shared responsibility to look after one another in this country.

I am extremely proud of Budget 2022. It comes at a difficult and tough time for many New Zealanders. What New Zealanders know when they see this, our previous work, and the work to come is that we have their back—we have their back—to make sure that we create a secure future for every single New Zealander.

A party vote was called for on the question, That the amendment in the name of the Leader of the Opposition be agreed to, to replace all words after “That” with “this House, and the people of New Zealand, have lost confidence in this Government, because this Budget takes them backwards. Households are going backwards. The books are going backwards. Outcomes are going backwards. The country is going backwards.”

Ayes 42

New Zealand National 32; ACT New Zealand 10.

Noes 75

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10.

Amendment not agreed to.

A party vote was called for on the question, That the Appropriation (2022/23 Estimates) Bill be now read a second time.

Ayes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 42

New Zealand National 32; ACT New Zealand 10.

Motion agreed to.

Bill read a second time.

DEPUTY SPEAKER: I declare the House in committee for consideration of the Pae Ora (Healthy Futures) Bill.

Pae Ora (Healthy Futures) Bill

In Committee

Part 1 Preliminary provisions

CHAIRPERSON (Hon Jenny Salesa): Members, the House is in committee on the Pae Ora (Healthy Futures) Bill. I remind members that they are able to participate remotely. If you’re on Zoom and want to take a call, please type “call” into the chat function. You should also use the chat function if you want to raise a point of order. If we receive new tabled amendments, I will advise members so that they can refresh the “House papers” page to see the new amendment. Finally, it would be helpful for members to ask multiple questions, if they have them, so that the member in charge can answer during the call. We come first to Part 1.

BARBARA EDMONDS (Associate Whip—Labour): Point of order. I seek leave for all provisions to be taken as one debate.

CHAIRPERSON (Hon Jenny Salesa): Leave is sought for that motion. Those of that opinion will say Aye. Is there any objection for the motion? There is objection. The question is that Part 1 stand part.

Hon ANDREW LITTLE (Minister of Health): Thank you, Madam Chair. I’ll just speak briefly to this part, but this is a critical part because this part of the bill contains the commitments of the Crown, or the Government, to the Treaty of Waitangi and sets out not only the commitment that the Crown is obliged to make under the Treaty of Waitangi but actually incorporates a set of principles that were taken from the Wai 2575 interim report of the Waitangi Tribunal, which is about making sure that our health system is equitable to Māori and to all New Zealanders.

The opening—the kind of starting point for this bill—is that we have a health system that is based on health need, but we also have a country where we know that health need is met inequitably across different population groups, principally Māori and also Pacific. So this is about setting up a set of commitments and principles upon which our health system will be based that better drives towards greater equity. So the combination of the Te Tiriti o Waitangi principles and the health sector principles are a vital underpinning to the way decisions are made in the provision of health services from here on, or at least from the enactment of the bill.

Dr SHANE RETI (National): Thank you, Madam Chair. I rise to speak to Supplementary Order Paper (SOP) 160 on behalf of the National Party, which puts a flag in the sand for rural communities under clause 7 and challenges this Labour Government to vote it down today. I’m speaking, today, on behalf of the 194 rural practices serving 728,154 rural people across rural zones 1, 2, and 3, and we seek to have their voices recognised in this bill. Locally, I challenge the local Labour MP to vote down this bill, and failure to offer protection to important rural communities—such as Hikurangi, Maungatapere, Waipū, Langs Beach, Ruakākā, Parua Bay, Matapōuri, Tūtūkākā, and Whangārei Heads—and to vote this down would be to say that you just don’t get it and you just don’t care.

This SOP requires the bill to ensure that rural communities have three things, and we’ve placed it high up in the bill in amongst the principles attendant to clause 7. The first is we require rural communities to have access to services in proportion to their health needs. The health needs of rural communities are high end and unique. Access, distance, communication, and workforce are all magnified in rural communities. I’ve been privileged to be a GP in rural communities, such as Rawene and Dargaville, where you travel long distances for home visits—there were no x-rays or laboratory services at night—where you were the only one doing after-hours, at some distance to a main hospital, where you get up to road accidents at midnight on Te Kōpuru Hill, not because you’re on duty but because you’re part of a rural community—it is what you do. More recently I’ve vaccinated in rural communities.

Rural health is different and needs to be recognised and futureproofed in this bill. The New Zealand Rural General Practice Network said this after the second reading of the bill: “The Minister was unwilling to define rural communities as a priority population in the legislation. It was further galling to see the Minister interviewed on TV3’s Newshub and asked to comment on the fact that rural-health professionals were concerned that they were not identified in the draft legislation, the Minister commenting that the problem with rural practice is that they are old-fashioned business models that don’t work anymore. That disrespects rural practices.”

Parts 2 and 3 of my SOP demand equitable services to achieve equitable outcomes. National, in health, wants to talk the language of outcomes, not the language of bureaucracy. We understand the unique needs of rural communities. The strategic priorities for rural health providers are: (1) to improve rural Māori health outcomes; and (2) to grow the rural health workforce from within the heart of rural New Zealand. And the three principles in our SOP serve all those agendas. I note, today, that late in the piece, an SOP has appeared on the table from the Minister that seeks to recognise—surprise, surprise—a rural health strategy in amongst, I believe, clause 40A—very late in the piece on the day. I think he’s recognised the pain from rural communities in excluding them and having them invisible in this bill.

This SOP and the National Party recognise the 194 rural practices serving those 728,154 patients, and we say, “We hear your voice. We want to hear that voice in this bill.” And we challenge the Government to vote down this SOP. Thank you.

MATT DOOCEY (National—Waimakariri): Thank you very much, Madam Chair. I just want to follow on from my learned colleague Dr Shane Reti in exploring the Minister’s Supplementary Order Paper (SOP) 169 that we found on the Table. What a difference it makes when the polls are tanking for the Government. They spent the whole time and expense of the select committee saying, “Oh, no, you can’t define rurality. You can’t do a rural strategy.” They said, “No, we’re not going to prioritise rural.”, and here we are, mea culpa, on the first part of the committee of the whole House, and here we have a rural health strategy, after denying it for weeks.

I say well done to the Opposition, because we got accused in the last debate of whingeing. This is what whingeing does. It delivers for New Zealanders. And, funny enough, the last speaker from the Government who accused the Opposition of whinging was from a rural seat, and he knows that rural communities were upset about this. And, of course, for a while, this Government didn’t care. They thought they knew it all, until they started to cede control. And that’s what they’re doing here.

They try and tell us this bill is about equity. But when it comes to equity of certain groups like rural communities, their equity didn’t count. And that’s why it’s not in the bill, and that’s why this Minister has been dragged kicking and dragging his feet to the committee of the whole House and finally puts up that he concedes the Government was wrong. And, quite rightly, 800,000 rural New Zealanders, who deliver 50 percent of this country’s GDP—quite rightly—deserve a rural strategy. So, yes, we accept that there’s going to be a rural strategy, but also we say, let’s back Dr Shane Reti’s SOP, because he was the one championing for the rural communities, as other MPs in the Opposition were. And I expect we’re going to hear from those MPs as well over the course of the debate.

This committee of the whole House is about questions, and my question simply is to the Minister. It would be nice to hear an explanation for the House today, why we spent so much time and expense on the Pae Ora (Healthy Futures) Bill at select committee, who were told, no, we’re not going to have a rural health strategy; why those submitters had to go through the anguish of seeing that bill put out in a draft form, where they had not been listened to. So it would be interesting to hear from the Minister, what has changed? When did he decide—or, in fact, when was he told that now we’re going to have a rural health strategy? What has changed? Why was that group told, “No, no, it’s all right; you’ll be covered under the health strategy that the Minister would determine.”? But now we see there is going to be a rural strategy.

This is a good starting point for what is going to be a long debate tonight, because, of course, there’s several other population groups that aren’t represented in here as well, and one of them that I’m going to be talking about in my future calls is mental health. So I’m very much looking forward to the Minister’s explanation.

RAWIRI WAITITI (Co-Leader—Te Paati Māori) (remote): Thank you, Madam Chair. Tēnā tātou. Well, it’s a pleasure to speak today during the committee stage of the Pae Ora (Healthy Futures) Bill, on behalf of Te Paati Māori and my colleague and health spokesperson Debbie Ngarewa-Packer, who is currently sick with COVID and is quite gutted that she won’t be able to be in the Chamber for this debate. But Debbie has told me how frustrating it has been on the Pae Ora Legislation Committee as Government members refuse to even include simple acknowledgments of tino rangatiratanga in the legislation. We should not have to scrap for what should be the bare minimum in all legislation that goes through this House, let alone a bill as important for Māori as this one.

While we continue to acknowledge the Government for adopting—in part—our 2020 policy to establish a Māori health authority, I think the Government should have read the policy a little bit more closely. That policy made clear how crucial it was that the authority had statutory independence and that it be funded to an equitable level. We have just seen in Budget 2022 how new funding entrenches inequities and actually widens the funding gap with the Pākehā system. The Minister has said he wants the authority to really make a difference for Māori, but how can it when it only receives 0.6 percent of the Vote Health budget, despite Māori making up more than 17 to 19 percent of Aotearoa’s population? How can it, when it doesn’t have the same functions and powers as Health New Zealand? I’ve just heard the Minister talk about the importance of Te Tiriti o Waitangi going hand in hand in the whole development of what is supposed to be the biggest health reforms in nearly a century. But Te Tiriti o Waitangi promises parity, and promises equality, and we’re not seeing any of that in this particular bill.

The passage of this bill and establishment of the Māori Health Authority will make a huge impact in reducing Māori health disparities. That is why we will continue to support the bill through the House. But it must be funded for what it is supposed to do. At the moment it will be funded to fail. However, this House must not set up tangata whenua to fail in the new system. We must ensure the legislation helps guarantee success. Under the current funding it will not be successful. Therefore, we have to put several amendments to strengthen the bill.

Supplementary Order Paper 168 amends Part 1 to recognise our people’s tino rangatiratanga. It does this by inserting a new clause that requires the legislation to uphold the tino rangatiratanga of tangata whenua in Aotearoa. It also replaces all references to the Treaty principles with references to the articles of the Treaty. For legislation to be compliant with Te Tiriti o Waitangi it must implement the actual text of the agreement that was signed in 1840—the articles which include the reaffirmation of the tino rangatiratanga of hapū and iwi. References to the Treaty principles in law have been used to water down the Crown’s commitments to its relationship with tangata whenua. Te Tiriti o Waitangi was a contractual agreement, not a statement of principles. We must not allow the Crown to pretend otherwise.

We are calling on the Government to admit they made a mistake in the drafting of the bill and at select committee, and we must do the right thing. This is a straightforward amendment that will make the bill more compliant with Te Tiriti o Waitangi, if that is the priority of the Minister and this Government. Parties across the House have the opportunity to show that they are committed to upholding our nation’s founding agreement, and I look forward to the Minister’s comments in this particular area. Kia ora tātou.

BROOKE VAN VELDEN (Deputy Leader—ACT): Thank you, Madam Chair. I would just like to start my contribution today by congratulating the Minister of Health for adopting the ACT Party’s amendment to the pae ora legislation. And I note that a few months ago, the ACT Party said that there are serious flaws with this legislation, with the health reforms, and that it ignored a substantial number of New Zealanders. Under Supplementary Order Paper 151, in my name, we adopted a rural health strategy to make sure that rural New Zealanders’ voices are not overlooked in the health reforms, and I’d like to congratulate the Minister for adopting a sensible piece of policy that will make this health reform better, because we know that the Government quite often overlooks the needs of rural New Zealanders, and I think that is a shame.

I’d also like to question what on earth changed the Minister’s mind. Was it really the letter that I sent him a few months ago? Or was it the question I put to the Minister in the House a few weeks ago, when I said, “Does he stand by his Government not including a rural health strategy, for the approximately 750,000 New Zealanders who live rurally or remotely, in the Pae Ora (Healthy Futures) Bill?” I wonder what the answer was. He said, “Yes.”—yes—“The Government was pleased to see a wide range of submissions”, etc., etc., but it wasn’t necessary to have a rural health strategy. So I would put it to this House that, if it was not for the ACT Party listening to the needs of rural New Zealanders, we would not have a rural health strategy in this bill.

Rural New Zealanders are quite often overlooked, but the ACT Party constantly is on the road, we’re constantly out meeting the needs of New Zealanders—listening to the concerns of rural New Zealand. Just recently, we’ve been up and down New Zealand on our Real Change Tour, being part of the community, listening to cares and concerns, and something that’s come out, which has stuck with me, is from people saying that this health reform is unnecessarily divisive, it doesn’t focus on health needs, and it has overlooked a substantive part of New Zealand—rural New Zealand.

We know that the Health and Disability System Review identified that people living in small towns and in rural towns can have poorer health outcomes and lower life expectancy. Rural populations were mentioned over 80 times in that health and disability review, and yet, when it came to the health system reform that this Government put forward, they were barely mentioned at all. If it was not for the ACT Party standing up for rural New Zealand, we would not be here congratulating the Minister on finally adopting a sensible change. We certainly hope that it will go some way to helping people get more access to midwives, to better healthcare, to better mental health care and mental health nurses, and to better mental health technology—a whole range of systems that can help rural populations. But I would also question why it was that only a few weeks ago, the Minister seemed to think that localities were the answer to rural New Zealand’s problems.

So what is it, Mr Little? Is it that the localities have lost your faith, or have you really been swayed by the ACT Party’s proposition?

Hon ANDREW LITTLE (Minister of Health): Thank you, Madam Chair. I’ll take this opportunity to respond to the first handful of contributions to date, to the extent that there are questions in them. I note in relation to Supplementary Order Paper (SOP) 160 that Dr Shane Reti is effectively seeking to legislate for health outcomes, and, unfortunately, it simply is not possible, credible, or realistic to legislate for health outcomes.

The role of the Government and the role of Government agencies is to put in place measures that seek to achieve particular outcomes but there can necessarily be no guarantee about that. The measures we’re putting in place, the structural reforms, give us a much better chance to get better decisions, better resource allocation, greater consistency, and greater coherence across the health system to ensure that there are better health services and, ultimately, that more people have access to health services, particularly those who don’t currently have access to them—that is the basis on which we can improve health outcomes. Simply legislating to say we will achieve equitable health outcomes doesn’t do it. You’ve actually got to have measures.

We know that the problem the National Party has is getting to grips with wanting a particular outcome and then being prepared to back it with action and resources. We know that their fundamental problem—and their track record in Government—is that they underfund and under-resource health and they cut taxes and wonder why everybody else is left to pick up the pieces. So we won’t be supporting SOP 160. It is meaningless and does not help.

I see that members have referred to the rural health strategy in my SOP, and although that applies to a different part of the bill, I will address some of the comments that have been made. I can say that the one party that has the strongest rural representation in Parliament is the Labour Party. We have a very strong rural caucus with whom I meet regularly, and have met, and they pointed out an obvious thing—the bill having been reported back from the select committee with the addition of a women’s health strategy. When you look at the provision in the Government Policy Statement on Health, the policy statement in the original draft bill, and indeed in the draft that was reported back to Parliament, referred to a number of population groups: Māori, Pacific, disabled, women, and rural communities. Rural communities were always specifically and explicitly identified in the bill. When the select committee recommended an addition to the range of discrete strategies that should be in the bill, and added women to it, the only community that was listed in the Government policy statement provision that was not then the subject of a discrete strategy were rural communities. That was an obvious inconsistency, and the very dynamic and very influential rural caucus in the Labour Party caucus came to me and pointed that out, and we agreed that that is an anomaly and it is the right thing to make sure that rural communities were provided for.

I can say, however, that I’m satisfied with the practical provisions in this bill, particularly around locality planning as rural communities will be way better served under this set of reforms than they have in the health system previously. Rural communities will know that Labour Governments fund health. They don’t de-fund health, which is what the previous Government did. Labour Governments fund health infrastructure, not de-fund it like the previous Government did. Labour Governments back communities to determine their own health needs, not turn their back on communities, whether it’s those with mental health issues or those rural communities. Labour doesn’t turn their back on them like the previous Government did—and it left this Government to pick up the pieces.

To our colleague Rawiri Waititi, who has raised this issue, I know that Te Paati Māori would like to have a reference to tino rangatiratanga or rangatiratanga—and I’m now turning to Part 1 of the bill—but the reality is that when you put language in legislation we have to assume that the courts will understand it and know it and apply it, and the reality about terms like “rangatiratanga” and indeed “kāwanatanga”, which is the counterpart to “rangatiratanga”, is the courts have demonstrated increasingly, and most recently in the Ngāti Whātua Ōrākei case that the Pākehā courts are reluctant to apply Pākehā interpretations to te reo terms. So we would be entering a period of considerable uncertainty if we were to use that language. In reality what’s most important is that when we articulate and adumbrate the principles that we want to adhere to, it’s the practical provisions that actually make the difference, and when you look at the architecture of this bill and the architecture of the systems we’re putting in place, this is about embracing mātauranga Māori, giving Māori a seat at every table in the health system, partnering with Māori, with a combination of Health New Zealand and the Māori Health Authority, to make decisions and to fundamentally change the approach we take to ensure that health services to Māori are more accessible, achieve better health outcomes, and lift the health of Māori in general.

So that is what we’re doing. I know that our colleague Rawiri Waititi referred to the statutory independence for the Māori Health Authority. The Māori Health Authority, without wanting to break into other parts of the legislation, is a statutory body. It is not a Crown entity. It’s a statutory entity, although it will adhere to some of the obligations of entities under the Crown entities legislation.

To my colleague Brooke van Velden, who notes the addition of the rural health strategy to the list of discrete strategies that will be provided for, again I reiterate that the reason I have agreed to make that change is on the advocacy of the rural members of the Labour caucus who said there was glaring inconsistency. Every other group referred to that was required to be the subject of elements of the Government policy statement had a discrete strategy, but not rural communities, and that was an inconsistency that, on the face of the bill, could not and should not stand, and that’s why that gap has been filled. I’m very thankful to the members of the Labour caucus—those with rural electorates and rural responsibilities—for their advocacy in that respect.

I reiterate what I say: when you look at the way we’re setting up the locality networks, of the first nine that we are now in the process of developing, seven of them have substantial rural elements to those areas, and we will continue to roll out that, and that will make a difference to health services in rural areas. To Dr Shane Reti’s apparent criticism of me for criticising the business models of some rural health providers, I say that that is a challenge we had. Some of those business models are not sustainable, and we had to find different ways of providing services—and not only providing services but attracting the health workforce into rural communities, and it will not be in some of the health services or health organisations that are in those rural communities at the moment. So that is a challenge to rural health leadership.

There’s a new organisation that’s going to be launched soon, and when you set yourself up to be a leader of a community, what goes with the claim to leadership is the need for responsibility and responsibility to those communities. Any claimed rural health leader who says that nothing needs to change is not a leader, and they would be an obstacle to leadership and to positive change for rural communities.

Now, I’m a Minister; I listen to advocacy groups. I spend a lot of time with advocacy groups. I don’t always agree with them. Sometimes I disagree with them quite vehemently, but the interests of advocacy groups should not get in the way of an objective and sensible analysis of what the challenges are now and the reasonable steps that need to be taken to address those challenges. This bill does that and gives the impetus to the health administration to enable us to lift health services and health outcomes for all New Zealanders.

NICOLA GRIGG (National—Selwyn): Thank you, Madam Chair. I want to start my contribution this afternoon with reference to the Hippocratic oath, and I would like to acknowledge Dr Shane Reti, Dr Liz Craig, and Dr Gaurav Sharma for the work that you’ve all done in the health sector.

The Hippocratic oath is recognised universally: first, do no harm. It is an oath of ethics historically taken by physicians. It is a seminal articulation of principles that continue to guide and inform medical practice. I submit to the committee this afternoon that without the inclusion of a rural health strategy, harm would be done.

We have seen for a number of years now a real decline in the health network around rural New Zealand, a network that is there to serve and service about 750,000 New Zealanders who, as Matt Doocey pointed out, contribute 50 percent of the GDP of this country. When we look to the inclusion of a rural health strategy in this pae ora legislation, the Minister has referenced the fact that he negotiates and meets regularly with industry groups and stakeholder groups. So I wonder if it was the Rural Health Alliance that may have swayed his opinion when they said that they were “very concerned with the lack of focus on rural communities”, that “it is well-documented that rural communities have poorer health outcomes than urban communities”, and that inequity needs to be addressed in these reforms. Or, in his multitude of meetings, was it the Rural General Practice Network that persuaded him when it said, “Rural New Zealanders need to be added to the list of priority populations.”, “Health inequities will remain and might well worsen as focus shifts elsewhere.”, and, finally—to quote—“Change can only occur if this group is identified,”.

So when I refer to the Minister’s own Supplementary Order Paper (SOP) No. 169 and the inclusion of the “Rural Health Strategy”, I can’t help but notice the similarities with Dr Shane Reti’s SOP 160 and I find it quite intriguing that this nine-page document landed on that very Table there about 60 minutes ago. I’m quite sure that I’d be casting aspersions if I was to suppose that this was pulled together at the last minute.

But I was very interested in the Minister’s previous comment that Dr Shane Reti’s SOP 160 would not achieve equitable health outcomes. Well, Minister, my question to you is if you are as derisive of outcomes as you appear to be, how about targets? How about targets for introducing rural maternity carers into the network?

How about targets to introduce rural GPs into the network, or professional mental health service providers, maternity beds, or aged-care beds, because, Minister, in my own electorate in Selwyn, as a result of the pandemic, we’ve had two rural hospitals closed. That has taken about 10 beds for aged-care residents out of Darfield and another 10 beds out of, in a little town called Leeston, the Ellesmere Hospital. These—what would we call them—clients, or patients, have been transferred to other hospitals because these too-small hospitals have not been able to staff them. In that period of time, I know that the residents or the patients in Ellesmere Hospital—out of about 10 of them, four have actually passed away. They weren’t able to die surrounded by their friends and their family in their own community, and I think that’s a travesty.

So, Minister, I am very interested in how, when incorporating a rural health strategy, that will be well-serviced by personnel in rural health.

CHAIRPERSON (Hon Jenny Salesa): I call Dr Michael Woodhouse.

Hon MICHAEL WOODHOUSE (National): Oh, I’ve got a promotion.

CHAIRPERSON (Hon Jenny Salesa): Sorry—the Hon Michael Woodhouse.

Hon MICHAEL WOODHOUSE: That’s quite all right, Madam Chair.

They say that imitation is the most sincere form of flattery, and that being the case, Dr Reti should be extremely flattered, because, as Nicola Grigg said, a Supplementary Order Paper (SOP) fell on the Table a considerable period after Dr Reti’s which does essentially the same thing. I was fascinated by the Minister’s explanation in answer to Mr Doocey’s question of how on earth this came about, and, apparently, it was obvious. It was an obvious inconsistency, and it was the rural backbench Labour MPs that implored him to make the change, only I’m reliably informed that that was anything but the case at select committee, where Labour backbench MPs did their level best to block important, meaningful changes that would improve the health of rural New Zealand.

So I’m really pleased that it’s here, but let’s not gild the lily, Minister. The people who, I think, as Mr Doocey said, really should take the credit for this amendment are Messrs Kantar and Morgan and Ipsos and Reid, because they’ve had more influence on this Government than the Labour backbench MPs.

Now, I want to go back, as Nicola Grigg did, to SOP 160 in Dr Reti’s name. The response from the Minister was extraordinary—the fact that he could only fixate on the term “outcomes” and took it as a disparaging thing. He said to Dr Reti, “You can’t write a law for outcomes.”, but you can write a law for the expectation of equity. The key word in this amendment to clause 7 is “equitable”, and it is about equity, where the good people of Lumsden don’t have a maternity centre any more and the people in any aged-care facility are having their nurses pinched away by the DHBs because they’re not being funded to compete on salary. That’s a question of equity, Minister.

We know from a plethora of research that coronary care, diabetes management, and renal management are all much poorer in regional and rural communities, because they don’t have as close an access geographically to secondary and tertiary care. That’s equity, Minister, and if the Minister believes his own rhetoric that this is about avoiding and eliminating the postcode lottery, this SOP must be supported. He talks a good game, but when it comes to black-letter law, which sets an expectation for outputs and outcomes, he isn’t—nor was his predecessor, Dr David Clark—prepared to say that “We will set an expectation, yes, for output, but yes for equity.”, and if they believe that, they must support Dr Reti’s SOP.

Now, I’ll conclude this call with a point I want to make in relation to Schedule 1, an amendment to Schedule 1 as set out in the Minister’s SOP 169 about visas. It’s in new clause 11A in Schedule 1, which is a transitional—

Barbara Edmonds: Point of order, Madam Chairperson. Thank you, Madam Chair. We sought leave at the beginning of the debate to be able to debate all the provisions as one. The reference that the member has just made is to Schedule 1. Yes, it’s in SOP 169, but it’s not part of the debate on Part 1.

CHAIRPERSON (Hon Jenny Salesa): Unfortunately, it is actually part of Part 1. So in Part 1, we have clause 3, clause 6, clause 7 and Schedule 1.

Hon MICHAEL WOODHOUSE: Thank you, Madam Chair. The issue I have with this amendment—I understand what the Government is trying to do. For the sake of those listening, what this amendment will do is if a visa is granted under the Immigration Act 2009 for what would be an employer-assisted work visa, a temporary work visa, and if it has a reference to a DHB as a condition imposed on it—as most essential skills work visas do. Often it’s the employer or the geographic area in which the individual is able to work. Now, there are 20 district health boards and they’ll be gone in about six weeks, so what this will do is say that if it says “a DHB”, it should refer then, instead, as a reference to Health New Zealand.

Now, the problem with that is that that potentially gives carte blanche to individuals who were recruited under a visa that said that you need to work—[Time expired]

Dr ELIZABETH KEREKERE (Green): Kia ora. Tēnā koe e te Māngai—

Hon Michael Woodhouse: Point of order. I will be seeking another call, but I would note that, during the point of order that took place, the clock did not stop and continued to count down.

CHAIRPERSON (Hon Jenny Salesa): I will come back to you right after this call, the Hon Michael Woodhouse.

Dr ELIZABETH KEREKERE: Tēnā koe. Many thanks to the Minister, to the officials who are here. I was a member of the Pae Ora Legislation Committee, and I know how much work that you all did on this. It’s a huge, massive piece of work, with massive implications for all of us. Firstly, I wanted to speak to a rainbow strategy. Now, I have recommended this, I have advocated for this—

Nicola Grigg: Nothing if not consistent.

Dr ELIZABETH KEREKERE: —in many parts of our community. This will be a surprise to people! Many parts of our community advocated through this submission process, and have been lobbying me ever since. When I first put up, some time ago, the Supplementary Order Paper 154 for this, I got a lovely letter back from the Minister and I was going to speak to this anyway, but I accepted the fact that it wasn’t going to be part of this bill. However, I come here today and suddenly there’s a rural strategy, and so I am emboldened to start again. And I just want to acknowledge, too, about the rural strategy, how much we support that, and that when our colleagues have raised this in the select committee and through this process—because so many of our people who are Māori, Pasifika, a range of all of our people who live in rural areas who are most affected by the postcode lottery, and who will have the most difficult time in making this new system work, without a clear strategy, so I’m very thankful.

I note that, and I want to mihi, then, to the Labour members that the Minister referred to who advocated for that. But I want to acknowledge my colleagues cross the House. I want to acknowledge the people in the community who actually have incredible expertise, incredible knowledge—they’re the ones out there doing the work, so their advice is something we take very, very seriously.

So a rainbow strategy. I figure I’ve got a couple more hours for this to maybe come to being. I’ve just come out of a webinar, “Te āniwaniwa takatāpui whānui: Te aronga taera mō ngā rangatahi - Sexual attraction and young people’s wellbeing in Youth19”. Some of you will be familiar with the Youth2000 series which, every few years, interviews thousands and thousands of young people—mainly students. Most things we know about young people in this country have come out of that body of work, and so the most recent one was in 2019. So this part is one half—kind of the “rainbow report”—of that data, and so this is particularly for people who are same-sex, multiple-sex attracted, or not sure either way. What we saw in that just reiterates every piece of research we have; everything we know about the impacts of discrimination for people with diverse genders, sexualities, and sex characteristics. But there was an entire section on health, and so it’s very fresh in my mind: statistics that show—especially for young people, but we know that it flows on through other ages; for those who don’t feel safe going into a health setting—their identities are not recognised, they’re not valued, and the health conditions that they’re presenting with, the people don’t have the expertise to deal with them. There are, in most parts of this country, no solid guidelines, no strategy for people to work towards. So we have advocated a strategy as, in this piece of legislation, the main mechanism by which such a thing could be created.

I’d like to ask the Minister, then, if not a strategy, and if we take a step down from that, what is the solution, so that people in Invercargill, people in Gisborne, people in Wellington Central—when they present into our health services—those GPs, those doctors, those nurses, those counsellors, and those allied care health workers know what to do? They know who to call. They know the community leadership that they can tap into. That’s what I’d like to ask you to respond to. Kia ora.

Hon MICHAEL WOODHOUSE (National): Thank you, Madam Chair. I’ll just conclude my question about Schedule 1, the amendment to clause 11. If an essential skills work visa has been granted conditional upon a person working in a particular DHB, and then we superimpose that and we make reference now to Health New Zealand, there is a risk, I think, that the geographic requirement disappears, and, therefore, while it’s a problem right across the country now—we’ve got a shortage of doctors and nurses and allied health professionals everywhere—there is still a risk that in smaller and more remote DHBs, like Southern, West Coast, Tairāwhiti, and so on, that those temporary visa holders could be attracted to main centres. I wonder if thought has been given to either a tabled amendment or some kind of reassurance that the committee can get that, even though it’s a reference to Health New Zealand, the locality requirement remains the same—if one was recruited on a visa that said Tairāwhiti DHB, they still need to stay in the Poverty Bay area—because I do think this could be an added problem for those DHBs that are heavily reliant on temporary work visas.

Hon ANDREW LITTLE (Minister of Health): Thank you, Madam Chair. I’ll respond to the more recent contributions, but I particularly want to respond to the Hon Michael Woodhouse’s point, because I think it’s an important point and he raises a very good point, and I thought very carefully about this. It kind of cuts two ways. Obviously, with the removal of the DHBs we need to make a change so that those with working visas who have a specific DHB mentioned as a condition of their visa, we’ve got to have that changed to Health NZ. I thought very carefully, do we provide for a further condition that they’re still tied to their locality. I’m satisfied that just through normal human resource management that that issue can be managed and those on those visas will stick with the particular hospital that they’re working at.

That said, there is a further proviso that I think is actually potentially helpful. One of the benefits of the whole of the public health workforce, or at least the hospital workforce working for a single employer nationwide, means that there is the potential for greater flexibility to deploy staff when needed, whether on a temporary basis or even on a permanent basis to allow career progression. We saw this during the COVID pandemic, and when the Auckland hospitals were at the peak of the pandemic, particularly last year, reached out to other DHBs to say, “Look, we need some more nurses or we need some more SMOs. What can you do to help?”, there was a real spirit of collaboration. Other DHBs did provide the opportunity for staff to go and there were obviously some negotiations about how that would happen. But they were able to draw staff from other parts of the country. It was all done; there were no secondments or anything. So they didn’t make it technically difficult on that occasion, because of the nature of the need. But it did illustrate, actually, with a single employer across the country, how it would be easier to arrange those deployments, including with people on a work visa. I’m confident that Health NZ will manage that very carefully.

I think this is the issue that we were grappling with—if I could just diverge for a moment—with those, particularly nurses, employed in the private sector under a working visa, and the immigration changes we’ve made that allows some categories of work, including health work, to immediately apply for residency, we still stuck, at least with nurses, many categories of nurses, to have a two-year working requirement before they get their residency for that very reason—that we didn’t want a private employer who employs a nurse from overseas to then suddenly lose that person within the two-year period probably to a DHB or to somewhere else. But I think the member raises a good point, and I assure the member that it has been carefully thought of, and I also assure the member of my confidence in Health NZ to manage that particular issue appropriately.

Can I go back to Nicola Griggs’ point. I know she asked about targets. That tends to be a management issue, as opposed to something you would legislate for, and she went on to refer to particular facilities, particularly maternal facilities. She will be aware, of course, that the bill now has provision for a women’s health strategy. So that’ll be an opportunity to deal with making sure that, along with the maternity action plan that my colleague Dr Ayesha Verrall is responsible for, we can work with communities where there is a gap to better provide for those sorts of services. In the end, that’ll be for the strategy to work out, and it’s not a matter that we would want to try to develop here in the committee stage of the whole House.

The Hon Michael Woodhouse, in addition to his immigration issue, raised the issue of equity. Just for the benefit of all members of the committee, I just point out that in clause 3, the purpose of the Act, the opening lines of that clause states: “The purpose of this Act is to provide for the public funding and provision of services in order to—(a) protect, promote, and improve the health of all New Zealanders; and (b) achieve equity in health outcomes among New Zealand’s population groups,”. That’s the purpose. That is already there. So members who are concerned about whether we’re taking equity seriously or whether we’re providing for it, whether it is about health need, those are the opening words of the legislation.

Finally, to Dr Elizabeth Kerekere, I know this is not strictly part of Part 1, but the rainbow strategy, we’ll come to that when we deal with the list of strategies, I’m sure. But in terms of what else can be done, I think there is great scope, including in the locality planning processes, which is very much community driven. The locality planning process is very much drawing on health provider input from health providers in the community and community input to see what can be done, particularly on issues like that.

MATT DOOCEY (National—Waimakariri): Thank you very much, Madam Chair. Well, it’s impressive, isn’t it? The Opposition on a bit of a roll. If it wasn’t for the Opposition, we wouldn’t have got the $350 payment in the last Budget, and now, thanks to the Opposition, we’ll get a rural strategy. And I want to drill down on the Minister’s comments because I think he gave a fascinating process into the internal working of the Labour Party caucus. Because what he told the House today, was—well, the bill just ended up in some sort of shape during the select committee. People weren’t too worried about it. All of a sudden it popped out the end, and the rural Labour members—first time they’ve seen it apparently: shock, horror, “No rural-health strategy?” So they rushed up to the Minister and said, “Sir, we’d like one.” And he said, “No problem. I’m here to help.”

But when you wind that back a bit, obviously, every party takes the proposed bill back to their caucus for deliberations. What happened at the deliberation stage? Why didn’t the rural Labour members stand up for Labour in their caucus? Well, whether they do or not—maybe they don’t. So it didn’t come back through there. So then you start to say, “Well, even before that deliberation stage, why didn’t the Labour MPs stand up for a rural health strategy during the select committee stage?” So I think it would be interesting to hear a bit more from the Minister, especially when we go back to the departmental report, Subpart 5. It talks about how many submissions sought the requirement of additional strategies on specific issues, such as women’s, rural, mental health and addiction, the rainbow community, rare disorders.

And it makes a very clear statement in the departmental report: “Ministers have instructed us to put forward an amendment creating a women’s health strategy.” So in that stage in the select committee, the departmental report clearly states the Ministers instructed us to put forward an amendment creating a women’s health strategy. So that poses the question: why did the Minister not instruct a rural health strategy at that stage, and why did the Labour rural MPs or why did any Labour MP—and I mean this is very interesting because they’re sitting there very quietly, but when you work through what the Minister said, he basically threw every Labour MP who was on the Pae Ora Legislation Committee under the bus, because he basically said it took a group of Labour MPs who weren’t even on the select committee to raise this glaring issue that, for some reason, had been missed out.

So what were the Labour MPs doing on the select committee? We sat for hours. I can tell you what: probably, what happened is they did raise it—they did raise it—and they got told to sit back down. And in fact, that’s why, in the departmental report, the Minister only instructed a women’s health strategy. And, of course, what we know is when the bill came out of select committee, there was a lot of ruckus by rural health providers, but the Minister will go and have a look. He was in the media, and he was very clear this wasn’t a priority group that was going to end up in a strategy. But all of a sudden, the Minister decides he’s going to listen to his backbenchers. Finally, the backbenchers are speaking, but I’ll let you into something: you should have done that in the select committee stage; it would have saved a lot of heartache of rural people who had to get out, because—I’ll tell you what—rural people don’t often speak up, and that’s probably their own worst enemy because they don’t. They have to watch environmental groups and every other group smash them, and here they thought, “Oh, the Minister wants to stand up and say, ‘Well, we’ve got a lot of rural MPs.’ ” Well, why didn’t they stick up for rural people during the select committee stage? Because we know, and we want to hear from the Minister what happened and why the rural strategy was not put in. What changed after the select committee stage?

Dr SHANE RETI (National): Thank you, Madam Chair. I’d like to first address the comments that the Minister of Health has made that the Supplementary Order Paper (SOP) in my name can’t legislate health outcomes—that can’t be correct. We’re looking to insert into clause 7—in that very same clause, clause 7(d)(3)—“the health sector should provide choice of quality services to Māori and other population[s] ... including by—harnessing clinical leadership, innovation, technology, and lived experience to continuously improve services, access to services, and health outcomes;”. That’s almost verbatim what my SOP says, so I’m afraid his commentary that you can’t legislate for health outcomes is neither persuasive nor interesting. I think the second part where he talks about listening to key stakeholders—that’s also tenuous. I’ve just texted the royal GP network, who are astounded—pleased but astounded—that this is now an SOP flip-flop from the Government. So I would suggest that key stakeholders haven’t actually been involved.

I want to talk to SOP 159—an SOP on behalf of the National Party—an insertion into clause 7, Part 1, which seeks to recognise that the only democratic utility in health is health need. It can only ever be health need. To choose anything else, including a Treaty response, as the foundational principle to our health system is to actually invite inequities and unfairness that daren’t be imagined. If Māori allow anything other than health need to be at the core of our health system, then they’ll be doomed to a fate that chooses a Treaty response today but the depths of one’s pockets tomorrow, and one’s value to society the next day. Do not be swayed by strangers bearing gifts. Meningitis doesn’t care about a Treaty response. Meningitis is agnostic to party colours, age, colour, gender, or race. It is simply an urgent health need that trumps all else.

This SOP 159 acknowledges the other principles set out in paragraphs (a) to (e), but affirms the primacy of health need above all other principles. I absolutely acknowledge—and myself and my team will bring every skill we’ve ever learnt to address—the inequities that Māori have in the health domain. They are true; they are real. But they best sit under the principle of health need, under which, it turns out, Māori have the highest health need for nearly every single metric you want to choose. Ethical issues of distributive justice talk about how scarce resources should be ethically distributed. In this context, all paths lead to health need. I encourage the Labour Party to support this SOP 159, and I challenge the Labour Party to vote down a health system that is not funded on health need. Thank you, Madam Chair.

RAWIRI WAITITI (Co-Leader—Te Paati Māori) (remote): Thank you, Madam Chair. I too found it difficult to hear the answer of the Minister around our Supplementary Order Paper (SOP) 168 to recognise our people’s tino rangatiratanga in this particular bill, after saying that Te Tiriti o Waitangi plays one of the most crucial parts of making up this particular bill. In that particular area, I thought it was—the only word I can find is—“caucacity” that my indigenous language is being determined by non-indigenous speakers, in terms of rangatiratanga being incorporated into this particular bill. I also find it very difficult that “rangatiratanga” is a key word in Te Tiriti o Waitangi, and this Government and the Minister have said how important Te Tiriti o Waitangi is in terms of the articles in the make-up of this bill—being ignored. So I just don’t get—this should be a straightforward SOP supported by this Government.

I just want to bring to light that, in 2017, the Court of Appeal confirmed that it can be stated with confidence that even where the Treaty is not specifically mentioned in the text of particular legislation, it may, subject to the terms of the legislation, be permissible intrinsic aid to statutory interpretation. Further, in 2021, the Supreme Court put emphasis on the need for Parliament to be clear if it intends to constrain Te Tiriti. So if the Minister is here to constrain Te Tiriti and not allow it to be the guiding light to the way a Māori health authority is established—the biggest health reforms in a century, for Māori—this is going to be an issue.

So the biggest issue is we’ve got Pākehā telling Māori how we see the health inequities and the Māori health index improve because we have not been given the chance. So we just find that Te Tiriti o Waitangi has just been thrown out there. This confirms the Māori Party’s perspective on the Budget, which was a vanilla cake with chocolate sprinkles—at the moment, we’re not seeing any chocolate sprinkle on it at all! So we’re getting an under-investment and we’re getting a watered-down version of what Te Tiriti o Waitangi means in terms of developing the greatest, and probably an opportunity for the biggest health reforms for Māori in this country.

The courts will not easily read statutory language as excluding consideration of Te Tiriti o Waitangi principles. It is a statute. It is silent on the question. It ought to follow, therefore, that Treaty clauses should not be narrowly construed; rather they must be given a broad and generous construction in intention to constrain the ability of statutory decision-makers. To respect Treaty principles should not be ascribed to Parliament unless that intention is made quite clear. So we are not clear. We’re, on one hand, saying it is playing an important part of the establishment of the Pae Ora bill and the Māori Health Authority but we cannot include the words in it like “rangatiratanga” and “tino rangatiratanga”. It doesn’t make sense. It’s absolutely glaringly obvious that this bill will continue, like many other bills and legislation in this House, to neglect Te Tiriti o Waitangi.

So, Minister, I want you to clarify that for me and for Te Paati Māori, and the reasons behind our SOP 168, which amends Part 1 to recognise our people’s tino rangatiratanga, which is a word that is used in Te Tiriti o Waitangi, the very Te Tiriti o Waitangi that you said was going to play a big part in forming this Māori Health Authority, and, in actual fact, should not be ignored or neglected any more by this House. So I look forward to your commentary in this particular space. Thank you, Madam Chair.

Hon ANDREW LITTLE (Minister of Health): Thank you, Madam Chair. Just to deal with the last three contributions; Mr Doocey’s repeated himself and there’s nothing much really to add apart from what I’ve said earlier, that in order to make the bill in its totality consistent, and referring to the provision providing for the Government policy statement that makes the commitment to rural communities, amongst others, it made sense—given that all of the other population groups referred to would have their own strategy—for there to be a discrete strategy for rural communities. It’s no greater than that, and I don’t really intend to repeat that argument again, even if members opposite wish to keep pressing that point.

To Dr Reti; effectively, he argued that because his Supplementary Order Paper (SOP) is provided for, therefore, you know, his SOP should also stand. So it’s actually not correct. Clause 3 of the legislation is very clear. It provides for the provision and promotion—if you like—of health services, with a view to achieving outcomes. His SOP requires that the health sector should ensure that the rural communities achieve equitable health outcomes. My earlier argument stands, and, again, I won’t come back to this argument, for the sake of avoiding repetition. In his Supplementary Order Paper 159, Dr Reti refers to “health need”. I’ll just point out that right throughout the Pae Ora (Healthy Futures) Bill there is reference to what that bill is about, which is ensuring that health services are provided, and there are mechanisms for providing health services that are relevant to communities and relevant to the country as a whole. That is a theme right throughout the legislation. So I reject Dr Reti’s claim that the bill isn’t predicated on meeting health need; it absolutely and utterly is. That’s why we have it.

To Rawiri Waititi, and his argument about needing to fulfil the Crown’s obligations under the Treaty. I refer the member to clause 6 of the bill. It makes it very clear in the opening lines: “In order to provide for the Crown’s intention to give effect to the principles of te Tiriti o Waitangi …, this Act”—and it spells out what the Act does, and critical amongst those is adherence to the health sector principles. The health sector principles are provided for in clause 7. Those health sector principles are based on the principles adumbrated by the Waitangi Tribunal and the Wai 2575 claim.

I think there’s always a difficulty with legislation adopting passages from the Treaty. I take the view the mana of the Treaty stands on its own, and the Crown is obliged to meet its obligations under the Treaty regardless of what appears in any legislation. Legislation should reflect—to the best extent possible—what the Crown practically needs to do to fulfil its obligations, and that’s what this legislation does. But the Crown’s obligation to fulfil the Treaty remains, regardless. And that is why we have Waitangi Tribunal inquiries and why there are claims made to the Waitangi Tribunal to make sure the Crown does that. It’s why the courts recognise the Treaty of Waitangi and apply it in the way that they do.

But the courts have increasingly shown their reluctance to take te reo terms from the Treaty—or te reo terms generally—and apply an interpretation within the Crown’s courts when the interpretation may not be easy to pin down, may be richer than te reo Pākehā can allow for it, and ultimately seeking to avoid disrespect to Māori and to te reo Māori. So I think we are at a point in our history, at a point where we are making legislation where we proceed cautiously, knowing that the obligations of the Treaty stand now, knowing the status that the Treaty has in our jurisprudence. But we approach cautiously references in our legislation to it. This legislation is very explicit about the way we intend to uphold our obligations under the Treaty in relation to the provision of health services, and I hope that assists the member.

BROOKE VAN VELDEN (Deputy Leader—ACT): Thank you, Madam Chair. I’d like to now turn to Supplementary Order Paper 152, in my name. It calls for the Minister to amend the Pae Ora (Healthy Futures) Bill to include a “Medicines Strategy”. My hope is that, given ACT’s success in our rural health strategy being amended, that the Government will now move to adopt our medicines strategy.

I hope that the Minister would seriously consider this, because many people might not yet be aware, but the Minister of Health today released the Pharmac inquiry’s final report. This was an issue that the ACT Party campaigned on. We put forward, saying that we needed to review Pharmac. It had been too long, and there was a lack of transparency coming from Pharmac and its decision making, and we really needed to look into whether Pharmac was still fit for purpose. Thankfully, the ACT Party was able to get the Minister to agree that we also needed a review into Pharmac.

But there is an element of this Pharmac review that I think needs to see the light of day, and in this report, it said that, “The Ministry of Health is responsible for developing health-related policy for the Government. In our view, the ministry needs to develop a replacement medicine strategy to guide the sector, including Pharmac, in its decision making.” It goes on to say, “We consider the absence of an up-to-date principles-based medicines strategy to be a crucial omission and one that will disrupt Pharmac’s integration into the new health system. With health sector reforms not far away, now is an ideal time to update the strategy to define medicines priorities. We consider the ministry should make updating the medicines strategy a priority.”

Well, thankfully we have the ACT Party, because we may be debating these particular clauses in the health reform today, and the Minister may feel like it’s too late to include a medicines strategy, given that the final report has only been released today, but I look right here at the ACT Party—No. 152—we’ve got one ready to go. It wouldn’t take much for the Minister to adopt the medicines strategy that the ACT Party has already put forward into the legislation—just as the Pharmac inquiry believed we needed to have.

Because, I don’t believe it is possible that we can reform the entire healthcare sector and not touch on medicines access at all. Hundreds of New Zealanders go without the medicines they need to live healthy, productive lives—currently. We know that we need better access to new modern medicines and we need it faster. And throughout all of this talk about reforming the healthcare sector, we’ve been talking a lot about administrative reform, and we haven’t been focusing on the outcomes. We know that medicines are changing. They’re changing all the time. New medicines are turning up. Over the last decade, we have invested the least into modern medicines in the OECD. We have fewer new modern medicines in the last decade than the rest of the OECD. I think we need to have a medicines strategy that actually plans out, for the next coming years, what we want New Zealanders access to modern medicines to look like.

I think having a medicines strategy within the Ministry of Health that actually contains an assessment of the current state of medicines; the performance of the health sector to do with acquisition and provision of medicines; what the medium trends are, what the long-term trends are for medicines access and health sector performance; and setting out some priorities for improving access to medicines would go some way to making sure that New Zealanders can live healthier, more productive lives.

I think it’s a shame that it was missed out of this health reform in the first place. But it wouldn’t take much for the Minister, in the same way that he’s adopted our rural health strategy, to also adopt our medicines strategy, because I think that’s the right thing to do for all New Zealanders and their healthcare.

CHAIRPERSON (Hon Jenny Salesa): Before I take the next call, I would like to warn members that the debate on this part, Part 1 and Schedule 1, is getting repetitive.

MATT DOOCEY (National—Waimakariri): Thank you very much, Madam Chair. I want to shift the debate, although it’s been very interesting hearing about the machinations of the internal Labour caucus on how they decide things—it’s all a bit finger-to-the-wind, and I think the public is clicking on that a lot of this is policy on the hoof. I want to look at the Supplementary Order Papers in my name, of 170 and 171. This is about a mental health strategy.

If it’s an issue that is emblematic of this Government talking out both sides of its mouth, it’s a Government that promises to transform the mental health system, yet in its once-in-a-generation—or so they tell us—reform of the health system, what we find is exactly what submitters said in the select committee stage: that mental health was invisible. Who would’ve believed it? A Government that claims to be transforming the mental health system, yet they’re reforming New Zealand’s health system and the peak bodies. I mean, this is the Mental Health Foundation, this is the Mental Health and Wellbeing Commission, the leading NGOs, and the common theme that came out of submitters is that they said mental health was invisible in this bill. How could we end up in a position where mental health is invisible? They also talked about how the Mental Health and Wellbeing Commission was not even an entity that the Minister needed to consult in developing not only the health strategy but, I would argue, the mental health strategy.

The Mental Health and Wellbeing Commission was a recommendation of Labour’s own mental health inquiry, to establish the commission as a voice for mental health in New Zealand. Yet, in this bill, they don’t even include it as an entity that the Minister needs to consult. Of course, we know the Mental Health and Wellbeing Commission put out its first report, which actually was very critical. It said that, despite the announcement of $1.9 billion for mental health, there was no material improvements. Yet, this Government wants to say “Trust us with a billion-dollar reform.”, and how is this going to improve health?

So my question is: why is there not a mental health wellbeing and addiction strategy? Why is it not a requirement? Is it because the Mental Health Commission’s actually been doing its job too well and it is critical of the Government’s performance in delivering nothing for their $1.9 billion?

But listen to the comments from the Mental Health Foundation about mental health being invisible in this bill. It says, “This would appear to be symptomatic of the absence of any ownership and leadership built into the new health structure for the transformation process”. Of course, one of the findings of the commission’s report was saying that, in mental health, we need leadership, we need a well-managed, clear plan that would execute change, and here we have, again, no ownership, no leadership of mental health in the bill in front of the committee today. The Mental Health Commission and the Mental Health Foundation are saying in their submissions that it needs to be a requirement and they want it legislated for this strategy to give people with mental health issues equal legal standing with other strategies mentioned in this bill.

We know, it’s been canvassed in the Chamber this afternoon, it is not too late to put a mental health and wellbeing strategy in; in fact, it is not only not too late, it’s actually the right thing. I think, when you go out there and you ask thousands of vulnerable New Zealanders who pitch up to your own inquiry and they tell their personal and, often, traumatic stories about how they wanted mental health to change—and there was a point here where this Government could have brought in a mental health and wellbeing strategy that would have driven transformation—[Time expired]

Hon ANDREW LITTLE (Minister of Health): Thank you, Madam Chair. Just the last couple of contributions, I think it’s appropriate to respond to. To Brooke van Velden and her call for a medicine strategy—indeed there are many Supplementary Order Papers calling for all sorts of strategies and, indeed, as I think Ms van Velden will know, at the select committee, there were many calls for different strategies. One of the reasons why we’re trying to chunk down and limit the number of discrete strategies is that you could have the ministry or Health New Zealand or the Māori Health Authority spending all their time developing dozens and dozens of strategies, all cross-cutting, all needing their own attention, but it’s not going to change things. Just having a statutory obligation for a strategy will take up a lot of time and resources. But actually what you want to do is get folks focused on the health services that are needed, getting resource devoted to that.

The member referred to elements of the Pharmac review. What the Pharmac review actually said is that the Ministry of Health should take responsibility for some medicines strategies, particularly in relation to rare disorders, because what they were saying was that Pharmac, as a procurement agency, should not be the sole arbiter of what a medicines strategy should be. And that is the recommendation we’ve accepted, as I’ve announced today, and we will do that.

I would refer the member to the definition part—I think it’s clause 4 of the bill, which refers to health entities. Pharmac is part of those health entities. Pharmac is required to observe the various requirements and obligations that would apply once this bill is enacted into law. What came out of the review and what I confirmed today is that Pharmac needs to be better integrated into the rest of the health administration. So I know the member wants a medicines strategy. The Labour Party will be voting against it, but I can assure the member that where we are going with the range of changes and the recommendations we’ve accepted from the Pharmac review is that Pharmac will be better integrated into the policy work—properly the responsibility of the Ministry of Health but contributed to as necessary by Pharmac—and Pharmac will remain with its very strong capabilities in procurement as the procuring agency. And if the member is wondering why we have fewer modern medicines, she might want to talk to her colleagues in the National Party and ask why they froze funding for Pharmac for three years in a row.

To Matt Doocey’s contribution in relation to a mental health strategy, the same sort of principles apply. We could have a statutory obligation for strategies for all sorts of health conditions and diseases and infections, and they’d run to a large number. That doesn’t change the ability to deliver on the ground. What changes is when you have a Government that properly funds health and doesn’t underfund it, that doesn’t freeze capital spending, that doesn’t underpay staff, and those sorts of things. So that just happens to be the difference between the two sides of the House at the moment.

The member, I think, misunderstands the status and role of the Mental Health and Wellbeing Commission. If he looked at the Mental Health and Wellbeing Commission Act 2020, he would see that the Mental Health and Wellbeing Commission is an independent statutory entity. It is independent because it provides a monitoring and oversight function, and it must stand apart in order to play its critique role and its advocacy role; so it advocates. In putting together any planning or strategy, naturally, I would expect Health New Zealand, the Māori Health Authority, where the ministry in its revamped form might take responsibility for development of plans and strategies—they’re going to engage with relevant communities, with those with lived experience. And to the extent that the Mental Health and Wellbeing Commission is an advocate, it has a statutory right to be that advocate and to be consulted, that is already provided for and isn’t needed in the member’s Supplementary Order Papers.

KIERAN McANULTY (Chief Whip—Labour): I move, That the question be now put.

CHAIRPERSON (Hon Jenny Salesa): The question is that the motion be agreed to. All those in favour will say Aye, to the contrary, No—

KIERAN McANULTY (Chief Whip—Labour): Madam Chair, point of order. Can we just clarify? I’m just putting that the question be now put, and I was just confused by—

Hon Gerry Brownlee: We can’t hear you. Take your mask off.

KIERAN McANULTY: Apologies. I’d moved that the question be now put, but what you said was that the motion be agreed to. So I just wanted to clarify, because there didn’t seem to be any response. So—

Hon MICHAEL WOODHOUSE (National): Speaking to that point of order. Two things, Madam Chair. Firstly, it’s customary, when the Minister has addressed an issue, that the debate not end. I didn’t take a point of order then, but I will just point that out. Secondly, your question was perfectly put. Nobody on the other side said yes to it, so, clearly, the Noes must have it.

CHAIRPERSON (Hon Jenny Salesa): No one said yes and, actually, no one said no, so let me—

Hon Gerry Brownlee: I said no. I know when I say no.

CHAIRPERSON (Hon Jenny Salesa): I’m sorry, the Hon Gerry Brownlee?

Hon Gerry Brownlee: I just said, “I know when I say no.”, Madam Chair. I’m sure if you go back—

SIMON O’CONNOR (National—Tāmaki): Point of order. Thank you, Madam Chair. It is just to seek your ruling on the first part of the Hon Michael Woodhouse’s notion that, after a Minister speaks, there has been a tradition or a convention in this House that further calls could be had. It would be useful, if you’re going to continue to put the vote, to indicate to the committee if that convention is going to change.

CHAIRPERSON (Hon Jenny Salesa): Well, actually, what had happened here is I had put the motion to the committee. You’re right in pointing out that there were some Noes, but I actually didn’t hear one Aye, so I will give another call if someone wants to take a call.

Dr ELIZABETH KEREKERE (Green): Kia ora. I’d like to point to two Supplementary Order Papers (SOPs) in my name, Supplementary Order Paper 164 and Supplementary Order Paper 166. We wanted to perhaps change some of the wording where we talk about engaging with Māori. If a core part of the health system is to eliminate the huge disparities for health for Māori, then we’re suggesting that there should be more partnering with Māori and less engaging—just being much more specific about Māori being part of the solutions. In the same way rural people must be part of the solutions for rural issues, so must Māori be part of this. Of course, I’m not denying at all the establishment of a Māori Health Authority—that is well under way.

I wanted to pick up on the point that the Minister had made about the law interpreting terms like tino rangatiratanga, because I think this is quite important. We suggest, in SOP 164, that the words “decision-making authority” be changed to “tino rangatiratanga”. I just wanted to point out that that is a term that was in Te Tiriti o Waitangi. It was 50 years ago this year that a protest—a peaceful protest—was held, a petition was put to this House to make te reo Māori be taught in schools, because of decades and decades of Māori being beaten up, being hurt for speaking Māori—so 50 years ago. The Māori Language Act came into place in 1987. That recognised te reo as an official language of Aotearoa, and it founded Te Taura Whiri i te Reo Māori, the Māori Language Commission.

It seems to me long past time that core and common Māori words don’t have proper interpretation in our law, aren’t included in our legislation. Some words are and then some words are not. So because Te Taura Whiri i te Reo Māori is available, we have many Māori language experts that could support the Government, including inside this House—incredible people with expertise in te reo that could help with that.

The second thing I wanted to point out—and I want to acknowledge the Human Rights Commission. In particular, this SOP 166 is to reflect something they had added in their submission, which we supported, which was the introduction of, and I quote, “respecting and upholding human rights, including the right to healthcare and health protection as set out in the International Covenant on Economic, Social and Cultural Rights.” It just acknowledges that in this country, we acknowledge that we sign up to a number of United Nations instruments, and that when we are restructuring our entire health system, acknowledging the one that identifies a person’s right to health. Kia ora.

Dr LIZ CRAIG (Labour): Thank you, Madam Chair. I move, That the question be now put.

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

Ayes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 42

New Zealand National 32; ACT New Zealand 10.

Motion agreed to.

The result corrected after originally being announced as Ayes 75, Noes 42.

Hon MICHAEL WOODHOUSE (National): Point of order. Madam Chair, there is a convention that when a motion is put there are no other speech words. That convention was breached. We didn’t take a point of order at that time—we were likely to have been defeated—but we will be wanting the rules of the committee to be followed more closely in future motions.

CHAIRPERSON (Hon Jenny Salesa): It is also up to the Chair to decide when to put the call, and I had actually put through the call and it was actually agreed to.

Hon MICHAEL WOODHOUSE (National): Speaking to that, Madam Chair, that is absolutely true, but the House has Standing Orders and Speakers’ rulings for a reason, and we would expect that on procedural matters relating to motions they are followed.

CHAIRPERSON (Hon Jenny Salesa): It is not always the case that when someone seeks the call that a question is put and then it’s actually, you know, that we continue to debate. It is actually up to whoever the Chair is whether or not the question is put.

RAWIRI WAITITI (Co-Leader—Te Paati Māori): Point of order, Madam Chair. I tried to vote but I couldn’t unmute myself.

CHAIRPERSON (Hon Jenny Salesa): Would you like to share your vote with us now, Rawiri Waititi?

RAWIRI WAITITI: Yes, it’s two votes in favour.

CHAIRPERSON (Hon Jenny Salesa): Two votes in favour. Can I ask the Clerk to recount the votes, please? May I seek leave to correct that vote to add the Māori Party’s two votes in favour? No objection. Can I ask the Clerk to please recount the vote and add two votes in favour. The Ayes are 77. The Noes are 42.

Motion agreed to.

CHAIRPERSON (Hon Jenny Salesa): The question is that the Minister’s amendment to Part 1 set out on Supplementary Order Paper 169 be agreed to.

Amendment agreed to.

CHAIRPERSON (Hon Jenny Salesa): The question is that Debbie Ngarewa-Packer’s amendments to include a commitment to uphold tino rangatiratanga and give effect to the articles of Te Tiriti o Waitangi as set out on Supplementary Order Paper 168 be agreed to.

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

Ayes 22

ACT New Zealand 10; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 97

New Zealand Labour 65; New Zealand National 32.

Amendments not agreed to.

CHAIRPERSON (Hon Jenny Salesa): The question is that Brooke van Velden’s amendments to Part 1 deleting “the Māori Health Authority” as set out on Supplementary Order Paper 153 be agreed to.

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

Ayes 42

New Zealand National 32; ACT New Zealand 10.

Noes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Amendments not agreed to.

CHAIRPERSON (Hon Jenny Salesa): The question is that Matt Doocey’s amendment to clause 4 inserting “the Mental Health and Wellbeing Commission,” into the definition of “health entity” as set out on Supplementary Order Paper 171 be agreed to.

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

Ayes 54

New Zealand National 32; Green Party of Aotearoa New Zealand 10; ACT New Zealand 10; Te Paati Māori 2.

Noes 65

New Zealand Labour 65.

Amendment not agreed to.

CHAIRPERSON (Hon Jenny Salesa): The ruling is that Brooke van Velden’s amendment to clause 4 relating to a rural health strategy as set out on Supplementary Order Paper 151 is ruled out of order as being the same in substance as a previous amendment.

The question is that Brooke van Velden’s amendment to clause 4 relating to a medicines strategy set out on Supplementary Order Paper 152 be agreed to.

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

Ayes 52

New Zealand National 32; Green Party of Aotearoa New Zealand 10; ACT New Zealand 10.

Noes 67

New Zealand Labour 65; Te Paati Māori 2.

Amendment not agreed to.

CHAIRPERSON (Hon Jenny Salesa): The question is that Dr Elizabeth Kerekere’s amendment to clause 4 relating to a rainbow health strategy as set out on Supplementary Order Paper 154 be agreed to.

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

Ayes 44

New Zealand National 32; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 75

New Zealand Labour 65; ACT New Zealand 10.

Amendment not agreed to.

CHAIRPERSON (Hon Jenny Salesa): The question is that Dr Shane Reti’s amendment to clause 4 relating to an older people’s health strategy set out on Supplementary Order Paper 157 be agreed to.

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

Ayes 42

New Zealand National 32; ACT New Zealand 10.

Noes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Amendment not agreed to.

CHAIRPERSON (Hon Jenny Salesa): The question is that Dr Shane Reti’s amendment to clause 4 relating to a health workforce development strategy set out on Supplementary Order Paper 158 be agreed to.

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

Ayes 54

New Zealand National 32; Green Party of Aotearoa New Zealand 10; ACT New Zealand 10; Te Paati Māori 2.

Noes 65

New Zealand Labour 65.

Amendment not agreed to.

CHAIRPERSON (Hon Jenny Salesa): The question is that Matt Doocey’s amendment to clause 4 relating to a mental health and wellbeing strategy set out on Supplementary Order Paper 170 be agreed to.

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

Ayes 54

New Zealand National 32; Green Party of Aotearoa New Zealand 10; ACT New Zealand 10; Te Paati Māori 2.

Noes 65

New Zealand Labour 65.

Amendment not agreed to.

CHAIRPERSON (Hon Jenny Salesa): The question is that Debbie Ngarewa-Packer’s amendment to clause 4 relating to a Māori director-general set out on Supplementary Order Paper 167 be agreed to.

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

Ayes 12

Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 107

New Zealand Labour 65; New Zealand National 32; ACT New Zealand 10.

Amendment not agreed to.

CHAIRPERSON (Hon Jenny Salesa): The question is that Dr Shane Reti’s amendment to clause 7 to insert health need as to overriding health sector principles set out on Supplementary Order Paper 159 be agreed to.

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

Ayes 42

New Zealand National 32; ACT New Zealand 10.

Noes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Amendment not agreed to.

CHAIRPERSON (Hon Jenny Salesa): The question is that Dr Elizabeth Kerekere’s amendments to Part 1 to require partnership with Māori and opportunities for Māori to exercise tino rangatiratanga set out on Supplementary Order Paper 164 be agreed to.

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

Ayes 12

Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 107

New Zealand Labour 65; New Zealand National 32; ACT New Zealand 10.

Amendments not agreed to.

CHAIRPERSON (Hon Jenny Salesa): The question is that Dr Elizabeth Kerekere’s amendment to clause 7 to insert a reference to the International Covenant on Economic, Social, and Cultural Rights set out on Supplementary Order Paper 166 be agreed to.

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

Ayes 12

Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 107

New Zealand Labour 65; New Zealand National 32; ACT New Zealand 10.

Amendment not agreed to.

CHAIRPERSON (Hon Jenny Salesa): The question is that Dr Shane Reti’s amendments to clause 7 to recognise rural communities in the health sector principles set out on Supplementary Order Paper 160 be agreed to.

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

Ayes 52

New Zealand National 32; Green Party of Aotearoa New Zealand 10; ACT New Zealand 10.

Noes 67

New Zealand Labour 65; Te Paati Māori 2.

Amendments not agreed to.

A party vote was called for on the question, That Part 1 as amended be agreed to.

Ayes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 42

New Zealand National 32; ACT New Zealand 10.

Part 1 as amended agreed to.

Part 2 Key roles and health documents

CHAIRPERSON (Hon Jenny Salesa): Members, we come now to Part 2. This is the debate on clauses 10 to 59, “Key roles and health documents”, and Schedule 3, relating to iwi-Māori partnership boards. The question is that Part 2 stand part.

Hon ANDREW LITTLE (Minister of Health): Thank you, Madam Chair. I’ll just make some sort of opening remarks, if you like. This really is the meat of this legislation, apart from the Hauora Māori Advisory Committee, which is the subject of a different part of this legislation. This sets up the new health entities, Health New Zealand and the Māori Health Authority. These will be the new beasts, if you like, that will be the engine room of our health system, not only providing greater coherence and better coordination across our public health system but also really driving a better equity performance than we’ve seen in the system.

We know that Māori have been under-served by our health system for decades and decades and decades, and we know the Crown has obligations under Te Tiriti that we owe better. We have an obligation to do better, but it’s more than just doing better. It’s also recognising and incorporating, as a partner, the voice of Māori into our health system. The Māori Health Authority does that.

The Māori Health Authority is not a Crown partner, but it is the vehicle through which the Crown’s obligation to meet its obligations to Māori are met. The Māori Health Authority also draws on the input of the iwi-Māori partnership boards. The iwi-Māori partnership boards are a product of iwi. That is where the nexus between Māori and Te Ao Māori and the health system really sits, and they are involved in helping to establish, or at least to appoint, the board members of the Māori Health Authority.

The Māori Health Authority carries the mana of iwi Māori and urban Māori as it prosecutes its task of working with the rest of the health system to drive good performance for everybody and better equity for Māori. That’s what that does, and these provisions, clauses 10 to 59, set out the obligations of each. It should be pointed out that the Māori Health Authority is not a Crown entity for the purpose of the Crown Entities Act, but, as a statutory entity, it will observe many of the obligations of the Crown Entities Act. But it is its own thing.

In addition to that, the Māori Health Authority and Health New Zealand have an obligation to put together a range of documents. They have to agree on those documents. If they cannot agree, there’s then a process for dealing with any disagreements, largely by coming to myself as Minister of Health and for the Minister of Health referring to the Minister for Māori Development and the Minister for Māori Crown Relations: Te Arawhiti. So that Māori influence in the Māori decision-making—the Māori voice—is strengthened at every step of the way.

This is the part of the legislation that incorporates a number of strategies and we’ve now added, through my Supplementary Order Paper (SOP) 169, a rural communities strategy. I should add, my SOP reverses a piece of work that the Pae Ora Legislation Committee put in place, which was to change the order on the document of the Government Policy Statement (GPS) and sort of everything else. The GPS is the principal document that the Government produces to set direction for the health system, so we’ve put that back into its rightful place through my SOP. But otherwise, it is all there.

The other thing this part of the legislation does is to establish the requirement for localities and for the development of locality plans, and although there’s only a small number of provisions in the bill for this, this is an absolutely crucial part of the machinery of the health system of establishing health need and engaging with both health providers and communities about how health need can be met and what health services should be put in place. So these are significant changes that will make a significant difference over time when it comes to health provision across Aotearoa New Zealand.

Dr SHANE RETI (National): Thank you, Mr Chair. The National Party desires to recognise the importance of the health workforce across the health sector by requiring the formation of a health workforce strategy. One of the key rate-limiting factors for today’s health system—which, as we speak, has cancelled surgery at Auckland and Christchurch hospitals—is a lack of health workforce. During the peak of Alpha, Delta, and early Omicron, it was a lack of ICU nurses that became a key rate-limiting step. Protecting the health system was code for protecting ICU beds and the 5.2 ICU nurses required for each ICU bed. New Zealanders paid a high price for a shortage of ICU nurses. Surgeries were cancelled so that unexpected delivery to ICU didn’t happen. Travel restrictions occurred, firstly, to assist infection control and, secondly, to reduce road accidents ending up in ICU as well.

Today, we have a health workforce crisis in nearly every part of health. In terms of GPs, we’re 500 short and there’s a tsunami of soon to be retiring general practitioners. Senior medical officers, 1,500 short; registered nurses, thousands short; and aged residential care nurses, a thousand short.

We sought to change in our Supplementary Order Paper the part of this bill that looks specifically at six parts of the health workforce that we think need to be attended to. We were keen to do this very quickly in the first 100 days, which is almost as long the Minister let the Pharmac report sit. In the first 100 days we would be looking to bring in information and actually enact a policy that would be implemented within the first year.

The first point we’re looking at doing is an assessment of the current state of the health workforce. The second point is to provide pathways in collaboration with relevant agencies such as Immigration New Zealand to improve our immigration settings. It is still unclear to me whether someone who comes in on the recently announced immigration pathway to residency—like a nurse on a two-year pathway—is committed to staying with the one employer or not. We would appreciate some clarification of that.

We would be providing pathways for international medical graduates who are already in New Zealand and driving Uber Eats—how can we allow that? How can that happen? How can we allow qualified doctors who have sat their New Zealand Registration Examination and paid a large amount of money to do so not find a pathway into postgraduate year (PGY) 1 and PGY2? That seems disingenuous to take their money and know there is no hope for them to go into their intern years. Maybe we need to look at saying, “If you pass NZREX, we guarantee and commit to an intern year.” The same with the many nurses, the hundreds of nurses who are here—well qualified, and a $10,000 competency assurance examination becomes the hurdle. Surely, we can figure out a way for that.

No. 4: we would provide pathways to increase the number of graduates, turning on our domestic pipe so we have more culturally competent practitioners that we’ve grown ourselves. No. 5: we need to take into account urgent workforce requirements for senior medical officers, GPs, critical care nurses, the rural care space, and the aged residential care sector as a whole. The sixth point we need to take into account for a health workforce strategy is that we clearly need to focus on pay equity, and when the DHB pay equity negotiation goes through, I have grave concerns for aged residential care. Then there’s pay parity: the issues we have with registered nurses out in the community, community nurses, GP primary care nurses, and, again, aged residential care nurses.

Then there’s primary-care funding. The health workforce cannot stand alone. It must look at primary-care funding. General practice is broken. The gateway to expensive hospital care, and what many believe, including myself—and, indeed, this bill is a key solution. The propensity for primary care to do more to keep people out of hospitals and to reduce the length of stay—how can we do that when there is no alignment of funding with costs, funding with complexity, and any funding that takes into account the high-quality provision of care that general practice brings?

This Government has shown its real intent around general practice funding in an advertisement a few weeks ago, requesting that GPs and other primary-care practitioners contribute their time to help the Government figure out what the health reforms look like and to do it for free. To put aside fulltime-equivalents to do for free what the Government hasn’t figured out is a disrespectful embarrassment to primary care and shows their real intent. This part of the bill needs a health workforce strategy, and the National Party will stand for that.

MATT DOOCEY (National—Waimakariri): Oh, thank you very much, Mr Chair. It’s a pleasure to take a call. Wow, what an absolute shambles. I mean, first they try and pass a motion to be taken in one debate—couldn’t even get that through. Normally, when you take a one-debate call it’s because you want to expedite the bill as quickly as possible. Here we are with their flagship health-restructure bill, and they want to expedite it as quick as possible, because as we knew about the Supplementary Order Paper (SOP) of the rural community strategy—and then we had the Government members trying to move a motion that they forgot even to vote for. There was no voice—a bit like the no voice from rural Labour MPs who sat on their hands and saw a bill being put in the House in first reading with no rural strategy. They sat on their hands during the select committee stage and didn’t even raise the issue about a rural health strategy, so it came out again without a rural health strategy. And then we now find out from the Minister that he had an epiphany where he woke up one day and realised, “Oh, I need rural health strategy.”—might have been the morning after the poll, I think. And it was all down to his Labour rural MPs. Well, I know myself, Dr Shane Reti, Nicola Grigg, we’re getting the texts now, and we’re getting the emails from senior rural health leaders who know exactly who has been instrumental in getting that changed, and that has been the Opposition.

So I want to look at clause 10 because I want to ask why the Minister is not determining a mental health strategy. If we look at this bill being proposed around a lens of equity, then why would you not have a strategy around mental health? When you look at the submissions with one of the leading NGOs, who said, “There is no explicit mention or prioritisation of health equity for people with mental health and addiction challenges, yet this group as a whole experience some of the most serious health inequalities.”—“some of the most serious health inequalities” in New Zealand. People with mental health issues have a life expectancy 20 years shorter than the average Kiwi—they have huge health inequalities. Yet we are told by this Government this is a bill about equity—equity when it suits them.

So we have a Government that came in promising to transform the mental health system, in fact, asked thousands of Kiwis to go to their own inquiry hearings and tell their very personal and traumatic stories about their experiences in the health system. They have a once-in-a-generation chance for the health restructure, and this bill—well, what did most of the submitters call it? The Mental Health and Wellbeing Commission and the Mental Health Foundation said mental health was invisible.

So how have we ended up in a situation where there is no strategy under clause 10 in Part 2 for mental health, addictions, and wellbeing? My final point is, and I’d like the Minister to answer, when you look at those groups—Māori, Pasifika, our disabled community, the women’s community or population—you’ve got to ask yourself whether mental health would be one of the quietest voices. Is that the problem here? Is it because people with mental health issues haven’t yelled enough or haven’t threatened electoral pressure? Why have they been left out? Because I would have thought the voice that came through the thousands of submissions in this Government’s own mental health inquiry would be a very strong voice. Why would you, when you came into Government promising to transform the mental health system, not have a mental health strategy under clause 10 that says the overview of the Minister’s role includes determining the following health strategies?

NICOLA GRIGG (National—Selwyn): Thank you, Mr Chair. I’d also like to refer to clause 10 of Part 2 of this bill. To the Minister, I don’t know how aware you are of the state of health services in Christchurch. If you think back to all of the earthquakes that our city and our region suffered since September 2010, and indeed February 2011, it has left our health sector very, very short on infrastructure and resource. And while the Canterbury District Health Board (CDHB) has built a new wing of Christchurch Hospital, it has had a very delayed opening and a very delayed capacity because of the very fact that the CDHB could not resource it with people. So, in reference to the overview of the Minister’s role in determining the following health strategies, including the New Zealand Health Strategy, I would ask the Minister to consider the inclusion of Dr Shane Reti’s Supplementary Order Paper 158, which would include a health workforce development strategy.

In Christchurch at the moment, surgeries are being deferred from Christchurch Hospital. The hospital is at 112 percent capacity. The DHB estimates that there is anywhere between 170 and 200 staff either off sick or off isolating. Ten minutes up the road, St George’s private hospital is likely to lose the remaining dozen or so maternity beds. Now, I understand that the story that is not reported in the media is this is actually due to the fact that they cannot staff these beds with midwives. CDHB has been promising for some time to build a maternity wing somewhere near Christchurch Women’s Hospital. I had a letter from the CEO just recently confirming it would be available by 2023. Thus far, I haven’t seen any indication any property has been bought, any tenders have gone out; there don’t seem to me to be any plans for the build of this facility. I hope I am proven wrong. Ashburton Hospital is only able to cater for very, very uncomplicated births. So that leaves the eyes of Canterbury and parents of Canterbury looking at my own electorate, Selwyn.

Simon O’Connor: What a great electorate.

NICOLA GRIGG: Thank you. In a very novel business proposition, the Selwyn District Council has acted as a developer and has built a health centre that includes about a dozen maternity beds that it’s now leasing out to the CDHB. As I referred in my submission earlier, we’ve also had the closure of the Ellesmere Hospital and the Darfield Hospital. Again, we know that that is primarily due to the fact that there is not the workforce available. So in the Minister’s ruminations over the New Zealand Health Strategy, I would ask that he consider the inclusion of a health workforce development strategy with some urgency. All the issues that we face in Canterbury are absolutely and utterly due to the short-staffing of the facilities and resources available. I would also like to know, if there is to be an inclusion of a workforce strategy, how will that possibly dovetail in with a rural health strategy? Because where we see the shortages in the urban centres, they are absolutely exacerbated in rural areas. So I thank the Minister for his consideration.

Hon ANDREW LITTLE (Minister of Health): Thank you, Mr Chair. If I just respond, as I can, to the most recent contributions.

So to Dr Shane Reti and, perhaps, to Nicola Grigg as well, who put the case for a workforce strategy—I do refer those members to clause 14 of the bill, which was amended by the Pae Ora Legislation Committee, and I’ll refer them to subclause (1)(fa) and (fb), which spells out, as part of the functions of Health New Zealand, in subparagraph (fa), “undertake health workforce planning; and (fb) collaborate with relevant entities to improve the capability and capacity of the health workforce;”. So that is a statutory function of Health NZ, and there’s a further obligation for them to cooperate with the Māori Health Authority on that. Because this is a Government that likes to back up its words with resources and action, the members will be aware from the Budget two weeks ago that we have put additional resources into workforce development for the Māori workforce, for the Pacific workforce, and for the health workforce generally, just in the way we have done with the mental health workforce that had been left pretty run down for nine years in a row by the previous Government.

It’s interesting that Mr Doocey should talk about epiphanies. I think the biggest epiphany is the National Party realising, in Opposition, that we actually have mental services. Having neglected them for so long, they now are in a dire state. It is this Government, in the last five years, that has actually taken the action to really boost them by adding more than 900 people to the front line of those mental health services and starting to make a real difference. But I’ll come back to Mr Doocey’s points in a minute because, as always, he’s got things wrong.

I just want to say, in terms of the state of the workforce, the members are right: there are some real challenges for the health workforce at the moment, not helped by the fact that the health workforce was also the victim of underfunding for many years by the previous Government. Indeed, you’ve got things like nurses. Nurses’ remuneration went backwards in real terms under the previous Government. They simply did not give pay increases to nurses that matched the rate of inflation. We’ve turned that around. Even before the pay equity claim, if and when that ever gets resolved with the Nurses Organisation, we’ve increased pay by 20 percent in the first four years that we’ve been in Government. But through the pay equity settlement, when that does come on stream, that is a significant change in remuneration for nurses. A nurse with seven years’ experience on a basic salary, a full-time salary of $95,000, and with the benefit of doing overtime and what have you, it will push it well over $100,000—that’s the sort of stuff to do, because we know that for nurses, they’ve been undervalued and, therefore, underpaid for so long.

But many of the challenges we have with the workforce is because there is a worldwide shortage of health workers, whether it’s at the senior medical officer end, whether it’s nurses, or whether it’s healthcare assistants. We’ve done a lot of work to support health entities, both public and private, to make sure that they can recruit offshore, but also investing and developing our own workforce. So, this year, we put 1,700 New Zealand graduate nurses into our health system just from last year’s production from the tertiary system, and we will continue to invest in that and grow places.

The member did raise an interesting point about overseas-qualified medical officers struggling to get supervised places for their postgraduate year 1 and 2, and I know the member is genuinely concerned about this, as we all are. One of the challenges we’ve got is, again, with the vacancies we have in the health system, arranging supervision. We’ve got to have enough senior medical officers who are prepared to provide that supervision to allow that to happen. I can say to the member that I am aware both the ministry and people on behalf of the DHBs have been working with the Medical Council and others to talk about ways in which that supervision can be provided that isn’t in the traditional form but can get those qualified graduates, who are driving Ubers and what have you, into a health system where they are desperately needed. The other aspect of that is that some of those graduates, because they’ve got family here, they’re very clear about where they want to go, and it’s not necessarily where all the vacancies are.

So look, these are challenges, but the member will be aware that is what goes with workforce management, much less with workforce planning. But the member will see from clause 14 in the bill that there is a statutory obligation on those entities to do workforce planning and the capability development that goes with it. I’m satisfied that those provisions close off the things that he would want in his Supplementary Order Paper (SOP).

To address Mr Doocey’s ongoing claims with his SOP for a mental health strategy, the health strategies that are referred to in there are population strategies. These are populations that, typically, have been underserved by the health system previously. We know Māori and Pacific and, actually, the disabled community—if you look at the responses they get, many of them struggle to get the health services they need. Many of them actually are very clear that their issues are not just about health services; it’s about the full range of services, which is why, as part of the reforms, we’re establishing a separate ministry for disabled people—it’s a working title at the moment.

But when it comes to a mental health strategy, that is a requirement of the health entities. I refer the member to clause 7(1)(e)(iii), where it refers to “(e) the health sector should protect and promote people’s health and wellbeing, including by— … (iii) working to improve mental and physical health and diagnose and treat mental and physical health problems equitably;”—that is to say that we don’t treat mental health services or the needs of those with mental health issues as somehow inferior or secondary to those with physical health challenges.

That has been the culture of our health system. It’s been the culture of the previous Government. That’s why this Government has worked so hard to address the challenges we have in our mental health system. That’s why we’ve added more than 900 people to the front line of mental health services, providing talk therapies and other assistance to those with mild to moderate mental health issues. It’s why we put another $100 million into mental health services for specialist and acute services in the Budget two weeks ago, where we can start to address those shortages in those services, where we can start to beef up the services available for those with eating disorders, and where we can start to provide places in the community for those who, having been through an acute episode and who would best recover in the community, will have places to do so. That is our commitment to mental health services.

So far, the only plan that the National Party has for mental health services is to appoint a Minister for mental health services, which tells you that the National Party is only interested in window dressing. They haven’t spelt out a single plan or a single thing they would do for mental health services, assuming that is different to what we would do. They are the party of window dressing when it comes to these sorts of things. Their track record in Government is to run down health services and to neglect mental health services. So I stand by what this Government has been doing and is doing, the commitments that we’re making, and I’m confident that the statutory commitments that are provided for in this bill means that our health services will be well looked after.

Nicola Grigg talked about workforce development. She seems to want me to start doing the work of those who will be responsible for putting together the women’s health strategy and others; I’m not going to do that. There is a statutory requirement to have a women’s health strategy, that will include maternity services.

What we won’t do is we won’t allow a repeat of what has happened in Canterbury before, and that is to have, in that case, a DHB that overspent its budget significantly year after year after year. If the member’s worried about what has happened to Canterbury health services, she should ask “What is the DHB doing?” They not only spent what they were asked to spend and appropriated to spend, they spent a heap more besides, and still they struggled to get the health services. This Government has been committed to Canterbury health services. It’s why we’ve approved additional buildings and why we’re backing the Canterbury District Health Board in its current form to continue to provide services.

The staffing shortages that are evident throughout are staffing shortages that not only are we experiencing across the country but the rest of the world is experiencing too. We hold our head up high in terms of the investments we’re making and the efforts that we’re making to fill the gaps that are there at the moment.

CHAIRPERSON (Ian McKelvie): I call Brooke van Velden, and, in doing so, I just put Rawiri Waititi on notice that I haven’t forgotten him.

BROOKE VAN VELDEN (Deputy Leader—ACT): Thank you, Mr Chair. I’d like to speak to Supplementary Order Paper (SOP) 153 that the ACT Party is putting up. This SOP is fundamentally why we oppose this health reform. In this SOP we are asking for the Government to remove the Māori Health Authority. Now, we believe that behind this health reform there are no better outcomes. All that this health reform is is an exercise in co-governance rather than in healthcare. We think that we need to get back to basics and understand what our healthcare is supposed to deliver. Will this legislation actually lead to better treatments, faster, for more patients, or will it simply deliver a co-governed system that will divide New Zealanders based on their race rather than on their health needs? That goes far—too far—away from the understanding that all New Zealanders have equal rights under the law, and that’s what the ACT Party proposes: that we consider healthcare as part of healthcare, rather than co-governance and race-based healthcare.

We put forward a minority view during the select committee, because we don’t believe that restructuring the healthcare sector, and saying that we need to remove the district health boards because we’re trying to get rid of a postcode lottery, and putting in place one Health New Zealand will make it better. But then, having the Government acknowledge that, no, they don’t want just one healthcare system, it would be better if there are two—two healthcare systems, Health New Zealand plus the Māori Health Authority, and to make it even more complicated, “Why don’t we put in place locality structures that are put in place by iwi-Māori partnership boards?”—the Government still can’t answer the question of how many iwi-Māori partnership boards there will be, how many localities there’ll be—he says up to 80—and how they’ll be structured. They’ve been given up to two years to create localities, and then another year for a locality plan.

Then, on top of all of that, you’ve got the iwi-Māori partnership boards, who are unelected people, who are self-selecting, who go to the Māori Health Authority and say, “We’d like to be in charge of this entire area.” They then have to work with Health New Zealand and the Māori Health Authority to create locality plans for all of New Zealand. Now, tell me: how is that any less bureaucratic than the system that we currently have?

You know, I’ve spoken to many, many healthcare providers and patient groups. Nobody can tell me how this new system will work, and they believe it will actually make their lives worse off, because not only do we not know who the iwi-Māori partnership boards currently are—and we still might not in two years—but we don’t know who the Māori Health Authority is going to be, we don’t really know how we’re going to work with Health New Zealand, we don’t know how the iwi-Māori partnership boards and the Māori Health Authority will work together, and if in any case something terrible happens, all of a sudden the Minister of Health has to get involved and arbitrate between all of these groups who have to decide on a healthcare plan. I think it is going too far away from looking at the basics of health needs of New Zealanders and putting patients first at the heart of our healthcare sector. All we’ve done is created a bureaucratic mess in an exercise of co-governance, and it has to go.

The ACT Party asks the Minister of Health to remove the Māori Health Authority, make our system less bureaucratic, put patients back at the centre of our healthcare system, and actually ask the simple questions of what health outcomes we will see from this health reform. We’re spending hundreds of millions of dollars in an exercise in co-governance and not in any better health outcomes for New Zealand. It has to go. Thank you, Mr Chair.

RAWIRI WAITITI (Co-Leader—Te Paati Māori) (remote): Thank you, Mr Chair. How appropriate to follow that speaker, Brooke van Velden, from that party. It’s weird how the party of property rights and law and order isn’t really into upholding contracts like Te Tiriti o Waitangi, the founding documentation and contract of this country.

Anyway, moving on to the adults, just to say that this still feels like the great white shark and the kahawai scenario, where Health New Zealand is the great white shark and the kahawai is the Māori Health Authority. We’re trying to find a partnership here, so what that great white shark does is eat the kahawai and say, “Well, now we are one.” You don’t have the two entities—it’s not independent, it doesn’t have the right to veto, and it actually doesn’t allow us to come up with our own health strategies, as promised in the contract that this country signed. You know, we’re consistently hitting our heads against the wall. I heard the Minister say that this Government backs up its words—just not the Māori words, from a document written by the Crown, whom this Parliament represents.

So our amendments would strengthen the bill by ensuring it better reflects Te Tiriti o Waitangi and our mana motuhake as tangata whenua. Our Supplementary Order Paper (SOP) 167 would establish a Māori Director-General of Health. If it was a true Tiriti-centric model, it would have a mirror. So whatever New Zealand health has, the Māori Health Authority should also have. So a Māori Director-General of Health would lead the operational management of the Ministry of Health alongside the Director-General of Health. So you would have two. Just like the Māori Health Authority and Health New Zealand, you would have two working side by side, working together to ensure that there is not a mismatch in the direction of trying to close health inequities for Māori. As I’ve heard the mono-health approach by ACT—you know, we would start to close where Māori die seven to 10 years earlier than everybody else. So the two key roles would work together and have the same powers, duties, and functions. All key decisions previously made solely by the Director-General of Health would be made by both positions, and if they cannot reach agreement on giving decisions then the decision will be referred to the Minister of Health for resolution.

This is far from any kind of equality—or equity, as I’ve heard the National Party talk about—and we are totally supportive that equity must prevail and equity must be at the forefront of the roll-out of the Māori Health Authority and Health New Zealand, but it is not. We would have been better to just receive the targeted funding under the district health board (DHB) model, because it was more than the 0.6 percent that we’re getting under this current model.

The establishment of the Māori Health Authority and Health New Zealand is the biggest reform of the health system in generations. We have an opportunity to finally address the institutional racism and systemic barriers for Māori, which have led to persistent inequities and entrenched health disparities for tangata whenua. Therefore, this House must not, yet again, set up Māori to fail under a new system. I totally agree with that: tangata whenua must have our decision-making authority recognised in the legislation.

These are rights guaranteed in Te Tiriti o Waitangi. It is time this country grew up and honoured that particular document. One of the best ways to do this is by establishing a Māori director-general of health, so that the success of the Māori Health Authority is not prevented by Pākehā bureaucrats—I agree with ACT there—in the Ministry of Health, as we saw during the pandemic. Even when Ministers instructed the release of Māori data—the courts backed it—the director-general was able to block it from happening.

Our other SOP would amend Part 2—SOP 172. This amendment strengthens the language in the bill so that Health New Zealand will require the agreement of the Māori Health Authority before carrying out its functions, such as services provision and health workforce planning, and I agree with National in that particular space. Rather than just being required to work with them, this would be a common-sense but significant improvement to the bill which would help ensure tangata whenua are not sidelined once again in the operations of the health system or in the new local bureaucracies that will replace the DHBs.

This new model must be better than the old one. Proposing a mono-system is not going to work. We must have equity, it must be funded equally, it must have a mirror image of what Health New Zealand is getting for it to succeed, and we must honour Te Tiriti o Waitangi as true partners. Never mind this co-governance rubbish. We’re into partnership, and the partnership is what is promised in Te Tiriti o Waitangi, and that’s what needs to happen. Kia ora tātou.

Hon ANDREW LITTLE (Minister of Health): Thank you, Mr Chair. I appreciate the opportunity to respond to the last two contributions.

To Brooke van Velden—and I know the ACT Party has never been shy about saying they want to remove the Māori Health Authority—it’s interesting that she talks about all New Zealanders being treated equally, but the reality is the health system does not currently, and has not ever, treated every New Zealander equally, and you cannot say everybody is treated equally when Māori, on average, die seven years earlier than European Pākehā. You cannot say everybody is being treated equally when Māori are twice as likely as European Pākehā to die of cancer. They are not being treated fairly or equitably.

Equity isn’t about everybody being treated the same; it’s about everybody being treated according to their needs. That is why I’m very proud that in the Budget a couple of weeks ago—and we’re proud of the work my colleague the Hon Peeni Henare did in making sure that the bowel screening programme is changed so that Māori, who statistically and epidemiologically—

Hon Carmel Sepuloni: And Pacific.

Hon ANDREW LITTLE: —and Pacific—get bowel cancers earlier in life, now will enter the bowel screening programme earlier than others, because that’s the sensible, but, most importantly, equitable, thing to do. That’s what health equity looks like.

Now, you can all ask about how we got to this point, but the reality is the Crown has not honoured its obligations under Te Tiriti. It hasn’t not listened to Māori. Māori need to be at the decision-making table and will be, and this is where I disagree with my friend Rawiri Waititi. Actually, this model—this structure that this bill provides for—puts Māori at every decision-making table in the health system that they need to be at.

This is a partnership, and we can see it in action already in the interim Māori Health Authority and interim Health New Zealand. The way that they have been operating has, in my view, exceeded my expectations. They are working hand in glove. They are the partners—not the Treaty partners, but they are partners in delivering health services with a very strong Māori voice, and they’re still strengthening, they’re still building, they’re still working, and Health New Zealand is inheriting all the palaver from the DHB system.

It’s interesting that Brooke van Velden should ask who the Māori Health Authority is. I can give her a hand: it’s a co-chaired by Sharon Shea and Tipa Mahuta, two outstanding Māori leaders. Both with quite different styles, but outstanding Māori leaders. Do you want to know who’s on the board? Dr Sue Crengle, outstanding health practitioner from down South. Dr Mataroria Lyndon, a really talented, young health practitioner. I see his name all over the place these days; I’m sure Dr Shane Reti knows him—a very talented and very high-powered intellect in Dr Mataroria Lyndon. I’m not going to mention every name, but I will mention one other, who Rawiri Waititi might know, and that’s Awerangi Durie. She’s also on the board—

Hon Willie Jackson: His family.

Hon ANDREW LITTLE: —turns out to be whānau of Rawiri Waititi. These are the really talented leaders in Te Ao Māori. As I get around and I meet health leaders of all stripes and all kinds, I can tell you, the Māori health leaders—and we’ve always had excellent Māori health leaders. You go back to the Sir Māui Pōmares and the Sir Peter Bucks. This is a country that has been blessed with outstanding Māori leadership in health. We’ve got them in bucket-loads, and they will now have a place to stand and a place to be and an authority now that will take Māori health and drive it and make it better for everybody.

So to Rawiri Waititi, I would invite him to look at the total structure that is being established here: the Māori Health Authority, supported by the Iwi Māori Partnership Boards—that is driven right out of iwi and urban Māori. Then the Hauora Māori advisory committee, which is not in this part; it’s in a different part, but it stands with that sort of structure.

I am required, as Minister, to refer to the Hauora Māori Advisory Council. When I exercise various of my powers, particularly those where I do continue to exercise them under the Crown Entities Act and the powers I have in relation to the Māori Health Authority under this bill, I have to refer to the Hauora Māori Advisory Council. That strengthens the Māori voice. That brings the Māori voice close to, or right alongside the Minister when it comes to making those decisions. If there are disagreements between the Māori Health Authority and Health New Zealand—because there’s a lot of stuff they have to work together on and agree on—then I don’t get to resolve that alone. I refer to my colleagues the Minister for Māori Development and the Minister for Māori Crown Relations: Te Arawhiti.

The voice of Māori is strengthened at every step and at every level of the health system. That is what we need to drive health equity for Māori, and I stand very proud of these provisions in the bill that do that.

Dr SHANE RETI (National): Thank you, Mr Chair. Supplementary Order Paper (SOP) 157 in my name, and on behalf of the National Party, recognises the importance of the healthcare of older people by requiring this to be a specific strategy in the Pae Ora (Healthy Futures) Bill. I’m becoming increasingly concerned about the aged residential care sector as a sector that is very close to breaking.

At an overview level, the long-term importance of the magnitude of the approach and quantum of care required for older people was evident in the 2021 Treasury document He Tirohanga Mokopuna. This described a long-term fiscal position over a 40-year horizon. The care of older people was highlighted specifically in the statement: “The most significant spending pressures come from a combination of healthcare and [New Zealand] Superannuation, which we project will increase by 6.4% of GDP from 2021 to 2061.” Those are the two long-term fiscal concerns of Treasury: superannuation and care of older people. You’d think with that that we might want to include it as a strategy in the Pae Ora bill.

The care of older people is an approach, a reality, and a privilege. Living arrangements range from independent living, aged residential care, support, and care. My concern is for the caregivers and the aged residential care workforce and the shortage we have right now of a thousand registered nurses, and we know that there’s a significant shortage of healthcare assistants—the two big groups in the aged residential care category. We know that when fully staffed, there are 5,000 registered nurses working in aged residential care. Nearly 50 percent of these are actually on a visa.

I come back to a previous discussion the Minister had and ask him to clarify the current settings for nurses who are not available for the shortened residency pathway. If they are on the two-year pathway, are they required to stay with one employer, because Megan Woods and Kris Faafoi said something different. That’s part of the concern of the sector initially that a nurse would be able to come in, work with aged residential care, and then move to a DHB. The Minister has said here, “No, that is not correct.” I need some clarity on that because I don’t quite understand how we can have a difference of views.

At the moment, there’s a shortage of, roughly, a thousand registered aged residential care nurses. We’ve got that perfect storm approaching, and amongst us we’ve got COVID, we’ve got immigration settings, vaccine mandates, work conditions, increasing acuity in the sector, sector funding, and pay parity. There’s a combination of forces coming together here, and I’ve mentioned the recently announced immigration settings which are not friendly to nurses wanting to work, not just in older people settings but in healthcare overall.

What will happen here if we don’t figure out a strategy for the care of older people? Particularly in aged residential care facilities, the facility owners only have a couple of levers they can pull. They can increase prices, and that’s really not tenable, or they can just start peeling back their high-resourced, expensive residential beds. Those are dementia care, and you can’t just build a granny flat for someone with dementia if they’re kicked out of their aged residential care facility.

So I’m very, very concerned about this sector—concerns that Age Concern are expressing to us. They’re worried, Grey Power are worried, social workers are worried, New Zealanders with older parents are worried, and Treasury are worried. I would submit we require this Labour Government to include an older people’s strategy, as described in my SOP, to deliver genuine care to older people. Thank you.

BROOKE VAN VELDEN (Deputy Leader—ACT): Thank you, Mr Chair. I would hope, with the time that we have left in this Part 2 debate, that the Minister would be able to provide some clarity about the iwi-Māori partnership boards, because it doesn’t matter who I talk to in the healthcare sector, nobody seems to understand yet how these iwi-Māori partnership boards would work.

I have a few points that I’d like some clarification on, and it’s that iwi-Māori partnership boards must be recognised by the Māori Health Authority before they can be established as an iwi-Māori partnership board. That would help create a locality plan, and part of one of its criteria is that “the boundaries of an area covered by the organisation do not overlap with the boundaries of any area covered by any iwi-Māori partnership board”. So every iwi-Māori partnership board has to have its own specified locality area, and these localities cannot overlap.

I’ve had a query about what happens if over time we may have iwi-Māori partnership boards that go to the Māori Health Authority and say that they’d like to be established as the iwi-Māori partnership board for a particular area, a geographic area, but then in a few years’ time, say, we end up with another iwi group or another hapū saying that they are the people who are engaged with the local marae and the local concerns of that particular area. How this would work when a particular iwi-Māori partnership board would be defined by the Māori Health Authority as the particular group for that whole area, and would there be any right for another group to claim that they, in fact, are the iwi-Māori partnership board who could apply to the Māori Health Authority? Is it possible that we could have multiple groups all claiming that they are the people who should be the iwi-Māori partnership board for a particular area, whereby we actually have overlapping conflicts of interest with different groups in different areas?

How do those types of conflicts get reconciled? I do note that if you just look at the Treaty settlement process, Ngāpuhi have not signed a Treaty settlement because different groups within Ngāpuhi cannot determine who it is that is in charge to be able to negotiate with the Crown. So in that particular element, do we end up with all of Northland not having an iwi-Māori partnership board, or could we end up with one group determining that they are in charge of the iwi-Māori partnership board for an entire area? Or is it that you could have eight different groups or 10 different groups all saying that their particular group has claim to a particular area, and they know the local groups?

How will this work? The Minister has said in the media that you’ve got potentially up to 80 groups, but he doesn’t know. So could the groups change over time? How will this work, especially when they have to be acknowledged that they’re established by the Māori Health Authority? Who is actually in charge of determining who the iwi-Māori partnership board for a particular locality is, and, if they’re established within a particular locality, can that change over time? And if that is true, who is arbitrating? Is it the Māori Health Authority that is determining that one particular group of people does not lay claim to a particular locality? In some ways, there’s a conflict there with the Treaty settlement process.

CHAIRPERSON (Ian McKelvie): Members, the time has come for me to leave the Chair. The committee will resume at 7 o’clock.

Sitting suspended from 5.58 p.m. to 7 p.m.

CHAIRPERSON (Ian McKelvie): Members, before the dinner break we were debating Part 2 of the Pae Ora (Healthy Futures) Bill.

Hon ANDREW LITTLE (Minister of Health): Thank you, Mr Chairman. I just thought I would take the opportunity to respond to some of the contributions just before the dinner break.

Dr Shane Reti had referred us to his Supplementary Order Paper (SOP) 157 and the call for an older person’s strategy. And I just draw his attention in that respect to clause 43C(1)(a) of the bill, which requires the Government’s policy statement on health to include “the Government’s priorities and objectives for the publicly funded health sector:” So that would also include parts of the health sector that receive public funding, as well as what we would currently call the district health boards (DHBs). So it is a requirement, when we set out our Government policy statement, that we also clearly refer to all parts of the health sectors that are in receipt of public funding. And that makes sense. It would make sense for the Government, if we’re going to fund activities, regardless of who’s providing it, that we do so in the context of a strategy and a plan, a set of values, and a set of principles. And that’s what this bill will do.

I note what the member says about the challenge with, particularly, the nursing workforce because of the large number of vacancies. Something in addition to the vacancies: one of the challenges we have that’s exacerbating things is the fact that we have a high incidence of absence for sickness, because, as you would expect, the health workforce is exposed to more sickness, and not only them but their families and whānau as well. And we’re seeing an elevated level of absenteeism for that reason. But we need them to be absent because when people are unwell or associated with people who are unwell, we need to make sure that they’re not putting other patients at risk.

The member expresses concern about facility owners, and the member can be assured I hear from the facility owners on a reasonably regular basis and hear their concerns. We will continue, the ministry and, I expect, Health New Zealand and the Māori Health Authority, when it is there. They have the authority to do so. We’ll continue to engage with those aged residential care services to make sure, to the best extent we can, particularly in these straitened times, we offer them the support and the help that we can. That’s what we have continued to do. I think, too, just more generally, I recognise the point the member is making is that, actually, that sector, to the extent that it provides important levels of care—hospital care and dementia care—it’s actually a very important part of our total health services, our total health offering. And so we do need to make sure that as we make strategies, as we make plans, as we set policies, we’re properly incorporating them and their interests.

To Brooke van Velden, who raised the issue of the iwi-Māori partnership boards, just a couple of things. First of all, iwi-Māori partnership boards are in existence at the moment, have been for some years. They haven’t had statutory recognition, but they have evolved under the current DHB model, as DHBs were required to find a basis on which they could engage with local Māori through iwi. So these boards have been set up. They have worked to varying degrees across the country, but we undertook, as we’ve set up these reforms, to actually (a) recognise them and (b) ensure that they are supported to be established to do the job that iwi want them to do and urban Māori want them to do, and, in a sense, sort of charging them up with a little more energy than perhaps they’ve had previously.

Now, the way that these things are, it is Māori that will decide how they wish to organise their representation. That is the right thing to do. The Māori Health Authority has a role to assist them in that, to support them in that, and they will do that. It will emerge over time how many there will be. Currently, as I understand it, there are about 14. That may be the limit of it. There may be one or two more. There may even be one or two less. Some may consolidate over time. But they will work out the way they will organise that, and then how they will interact with Health NZ both at a regional and a national level, and then feed into the various work that has to be done. So I am quite confident that they will work that out.

Likewise, they will work out their relationship to the locality planning process. They are an integral part of that. We need their voice in locality planning, and they will work that out because there will be the kaupapa Māori health providers and there will be plenty of other health providers providing services to Māori, where iwi and urban Māori organisations will want to and should properly have a say on what happens there. So no further changes are required, and so we won’t be supporting the member’s SOP on that. We think that what is in place in the bill at the moment will do the job.

MAUREEN PUGH (National): Thank you, Mr Chair. Thank you. I’ve been trying to get a call on this bill all afternoon. Thank you. I’m speaking to the Pae Ora (Healthy Futures) Bill, Part 2, and I want to focus on Subpart 2, which is “Health New Zealand”, Minister. Some of the activities that are listed in the bill about the functions of Health New Zealand are seen to omit the focus that some of the Health New Zealand responsibilities and, in particular, the ownership of district health board (DHB) practices—and I’m not sure if the Minister is aware, but at last count, and I do stand to be corrected, 10 of the 12 clinics and practices on the West Coast were actually DHB-owned. So I wonder if the Minister could explain: what is the future for these practices and, then, how is the current relationship with the primary health organisation (PHO) going to work in terms of the funding arrangements? Because, as you will be aware, the funding comes via the Ministry of Health through contracts with the DHB and is, then, on-funded through capitation and contracts and programmes into the practices, and also undertaken by the PHO.

So there are some things that the PHOs are doing now with their GP practices, and some of those are becoming quite challenging. As we know, the workforce issues which have been spoken about today is a big part of that. So, in terms of the Minister’s responsibility that it talks about in here as part of Subpart 1 is around developing those strategies, and we learn today that there is going to be a rural health strategy. Can the Minister tell us and the communities how long it will take to develop that strategy and, then, after that, how long it will take to implement that strategy and, inside of that, what will the measures be for success and how long will the Minister anticipate it will take to recognise the success in that particular strategy, and will the Government agree, if that rural health strategy does not measure and deliver success, to unwind this legislation?

And one of the things that I am concerned about with the DHB-owned practices is the workforce, but also some of the other contracts that are funded to deliver services into the very outreach areas. And one of the issues that was raised with me was midwifery services and the struggle that it is for midwives to service areas for the likes of Haast. So a midwife may have to travel 3½ hours to visit one woman and 3½ hours to come back. So, basically, that’s a whole day, and the payment for that is recognised at the end of that service when the delivery happens—literally. So will the rural health strategy actually recognise the time constraints involved with delivering services in rural areas and compensate those practitioners adequately for the service that they provide in those areas?

When I was discussing this with some colleagues, I thought, “Well, the best thing for me to do is to actually contact my PHO and ask them how the new structure is going to impact on them come 1 July when the changeover is likely to happen.” And to my surprise, the manager told me that she had absolutely no idea—no idea what was going to happen to her team and to all of the service providers. And I thought that was quite telling in terms of the contact that obviously has happened—or lack of contact that has happened—with those front-line workers. Now, she was quietly confident, because they are the only act in town—they have the workforce teams—but actually they didn’t know what their role was going to look like when this new system was put into place. And I just think, Minister, perhaps there needs to be a bit more liaison with the people on the coalface as this is rolled out. Thank you.

Dr SHANE RETI (National): Thank you, Mr Chair. I want to pick up on a previous point. Rawiri and myself will stand on different sides of the Māori Health Authority, that’s quite clear. But in conversations, we’ve both expressed concerns about whether the Māori Health Authority is being set up to fail. And the discussions tonight around Schedule 3, the “Iwi-Māori partnership boards”, are something that needs some explanation back to those entities—initially as iwi Māori relationships, actually.

What happened was they came into select committee named and written in the schedule. I was called by a number of them as the select committee process was finishing, and they were actually proud to be named in the legislation. They said, “Shane, we’re named. We’ve got real pride here. Our name appears in the legislation in the House. Tell us what happens as we come out of select committee.” Within 24 hours of coming out of select committee I’d been contacted by the chair of one of the iwi-Māori partnership boards saying, “Shane, are we still there? Are we still in the legislation?” And my answer to him was, “No you’re not. You’ve got a red line through you, actually. You’ve been deleted. Or in fact, if you look at the text, you’ve been ‘vacated’ ”. And they were hugely disappointed.

What do I say to them? They now have to apply. They’ve been vacated. What do I say to them? How else could they draw the conclusion that they also had been thrown under the bus, that they don’t exist in a form that either they’d been promised or that they hoped to be, that they’ve just been nonchalantly deleted and, as I say, what the text describes as “vacated” and they now need to apply. So I’d like the Minister to help me with an explanation so that I can explain to them what’s happened. Thank you, Mr Chair.

Hon ANDREW LITTLE (Minister of Health): Thank you, Mr Chairman. And I’ll just grab my notes. I just want to thank Maureen Pugh and Shane Reti for their latest contributions.

Maureen Pugh has, first of all, asked about the functions of Health New Zealand—and I think they’re pretty clearly set out in clause 14 of the bill—and referred to the West Coast, the clinics that are owned by the district health board (DHB). That is correct. That was in order to ensure there were good primary care services. The DHB, frankly, had to step in where other primary care providers, particularly GPs in private practice, were not prepared to go. And they’ve developed what, in my observation, is an excellent model, where they can train aspiring GPs in the hospital and put them out into their practices, and they can move them around as needs must. So I think—and I see Ms Pugh nodding—she should be very happy. I think there’s a great set of services there. Not to say they’re not under pressure, because, I think, like everywhere, they are.

I think the question Maureen Pugh raises about primary health organisations (PHOs) is—I mean, it’s interesting; I’ve done a number of meetings, roadshows, and PHO representatives have been there, so I’m not quite sure what’s happened to the PHO on the West Coast. But here’s the thing: PHOs are not recognised in current legislation. They were a beast that kind of evolved under the current legislation, under the DHB model. They offered themselves as the ability to support multiple GP practices and to help them in back-office functions, provide a bit of coordination, and all the rest of it. Some PHOs have done an excellent job. There are some that have done a pretty darn hopeless job, to be honest, and really are in the business of ticket-clipping.

We haven’t recognised PHOs in this legislation. What happens with them in the system is really entirely up to them. No one is abolishing them, but, actually, we’re not giving them statutory recognition, because they haven’t had it before. But it’ll be up to them. Now, some PHOs, I think, will step up and be able to do what is required of them. I know for a fact that there are PHOs saying, “We would like to be the locality planning coordinator for our area.”, and they are the PHOs who’ve got good leadership, they’ve got good data, and they’re well connected not just with the practices that they’re responsible for in channelling the funding to but connected with other health services as well. And that’s what we want. Ultimately, what we want is health providers in communities being supported and connected with each other and offering services that are coordinated and joined up.

So I guess I would say to Ms Pugh, it’s really in the hands of PHOs what they are prepared to do. There are opportunities there for them, but if they’re not prepared to step up and be part of the local locality planning process then they may find there is no role for them. Our critical objective is to get support, particularly for primary care. We want to beef-up primary care because it’s being underdone at the moment. Yep, we’ve got some major workforce challenges, but we’ve got to create a primary care working environment that is attractive to more medical graduates to work in primary care and to be GPs. So that’s what we want it to do.

To Shane Reti and his concern about iwi-Māori partnership boards: let’s be clear, iwi-Māori partnership boards are not recognised statutorily at the moment, and they weren’t previously. They weren’t in the 2001 legislation, which is the current legislation, and even though they’ve been around for a while, the previous Government—and nor this Government; well, we weren’t because we were looking at reforming the sector anyway. But, certainly, the previous Government took no steps to give them statutory recognition. We have, because we think iwi-Māori partnership boards are a vital component to what we want to do in terms of enriching the Māori voice when it comes to health decision-making. But we need to leave it to Māori, iwi and urban, to come together and make their judgment about how best they think that can work. That’s how the Treaty partnership works. We don’t have the Crown telling them, “Right, we’ll have one here and we’ll have one there, and it’ll be you and it’ll be you.” Actually, we need to empower iwi Māori and urban Māori to make those decisions themselves, as, in fact, they have done up to now without the benefit of any statutory recognition.

However, because they are an integral part of the future of the system and will be supported by the Māori Health Authority, and because we’ve appropriated money to support them and give them a bit of capacity, it is appropriate that we do accord them their existence in a schedule. But once we know who they are, who they cover, what they do—in terms of which areas they cover, which they will determine—then they will appear in the schedule and they will be given the recognition that they seek.

SIMON WATTS (National—North Shore): Thank you very much, Mr Chair. Stiff competition over on this side. I do appreciate the opportunity for a short call. Thank you, Minister, for the contributions to some of the questions. I want to come back to Supplementary Order Paper 157 in the name of Dr Shane Reti, in regards to the insertion in clauses 4, 10, 29, and new clause 40B around the older people’s health strategy. Dr Reti referenced it in his point, and it’s something that I’m reasonably familiar with, around the long-term fiscal plan that Treasury has completed, which they do every four years in regards to looking forward 40 years for New Zealand. As Dr Reti articulated, the two key components that were highlighted significantly in that report was, one, in regards to climate change, but the other was in regards to our ageing population.

The statistic that Treasury quotes is that in New Zealand, like many other countries, we’re seeing a major shift in terms of the age of our population and by 2070, I think they reference, 25 percent or one in four Kiwis will be over the age of 65. So the absence of a specific focus around older people’s health is going to be a significant area of growth and importance, as the years progress. And, no doubt, the intent of this legislation is to be sustainable in terms of the future, but one of the key aspects it looks like it is missing—and I’m keen for the Minister’s perspective on that—is how much thinking was put into play between the Ministry of Health and Treasury in regards to this? Because I must say, on looking, it looks like it’s potentially—some would say it could have been done in silos, in terms of the context around that. Because, on one side, the Government is saying this is a major area; on the other side, it’s not a priority. So I’d like a little bit of context in terms of the work that’s gone on between those two agencies in particular, around that specific point that relates to Dr Shane Reti’s Supplementary Order Paper.

The other aspect, as the Minister will know—and the questions I’ve asked him in the House in oral questions in the past, last year particularly, in mid last year around the health workforce related to the aged-care sector, which this Supplementary Order Paper refers to—is the significant workforce crisis that we have in that space. I guess, the question, really, there was: if this new health entity structure is genuinely going to work to try and address some of those workforce gaps, why have we not seen any change, really, in terms of that dynamic? Probably some, in fairness would say, actually a worsening of that situation and also, in the recent Budget that was out 12 days ago, very little funding in regards to staff retention. As the Minister will be aware, our health workforce is like a leaking sieve, and that will only be exacerbated by our borders reopening and people going overseas because of the higher salaries and—actually, not just salaries—the working conditions as well, which is an issue for those who are based here and do a great job within our health system in New Zealand. So a little bit of context around why retention of existing staff hasn’t been prioritised, as and where it relates to, particularly, the aged-care sector.

The third question is in the context of the significant scale of change that is currently under way within the healthcare system. And I think no one would argue; there’s a quote “never a right time to blow up the health system”. You probably wouldn’t choose to do it at the same time as a pandemic, but that’s necessarily where we are here. What aspect, in terms of the aged-care sector in particular, because it’s a mixture of private and public funding—what confidence can Kiwis have out there, particularly those elderly that are within care homes that are currently dealing with the impact of lower quality of care because of lack of staffing, and probably leading to adverse events in terms of clinical outcomes and the health outcomes? What confidence can they have that they’re actually going to see any change in terms of their position in the next two to three years—I’ll be generous—as a result of this structural change that is being proposed and the fact that, as number 157 states, there isn’t a specific health strategy for older people? Thank you, Minister.

Hon MICHAEL WOODHOUSE (National): Thank you, Mr Chair. I want to move to clause 16 of Part 2 and, in particular, the requirement to operate in a fiscally responsible manner, and it goes on to say, for this purpose, “endeavours to cover all its annual costs (including the cost of capital) from its net annual income”. There’s a similar clause at clause 24 for the Māori Health Authority.

Now, I’m advised by Pae Ora Legislation Committee members that very little cognisance was paid in the deliberation to the financial management of the sector. What we have at the moment is 20 district health boards (DHBs) and a plethora of other organisations all required to furnish financial accounts to this House, and most of them have made thumping-great losses. It’s a peculiar feature of the health system, where that seems to be tolerated to a far greater level than, for example, other public sector agencies—if the fire service or the New Zealand Police said, “Look, we know we only got $1.5 billion this year, but we knew, you know, to run an effective service, it was going to cost $1.8 billion, so here’s a bill for $300 million, Government.” But Governments of both colours have had this problem, albeit that the combined financial deficits of DHBs when we left office was $90 million. We’ve got individual DHBs with greater deficits than that now. Budget 2022, I do acknowledge, had a thumping-great envelope of money to clear those deficits and to prevent, to the degree possible, that happening in the future.

But my questions are, really, around the financial management at a hospital level, in particular the capital. So what responsibility for fiscal prudence and working within one’s means are the individual hospitals going to have, and what level of autonomy for things like capital maintenance, upgrade, replacement—you know, if an MRI needs replacement, is that decision going to be made in Dunedin or Wellington?

It seems a very, very murky picture of an extraordinarily large organisation now, with a massive network of service-delivery places, and I’m advised by the select committee that there was very little reference to how this is all going to be managed. Now, I think all of us agree with the endeavour—in fact, I think the idea that it should be an endeavour rather than an absolute requirement speaks to the reality that health is a bit different. But I do want to get some sort of picture of what we are going into in the next year about prudent fiscal management.

We’ve got a pile of people right across the DHB network right now whose sole job is the management of accounts, accounting functions, asset registers, building maintenance—where are they all going to go? Are they going to be needed in the future? Ultimately who is responsible, Wellington or Christchurch or the individual organisations, for actually making sure money is not spent excessively? But if demand exceeds the financial allocations that are granted to individual hospitals, if there are at all, who decides whether or not that money should be spent and how quickly will those decisions be made?

I think the committee of the whole House deserves a bit more sort of insight into actually how this thing is going to run, because I feel like we’re building the plane as we’re flying it and that this particular weakness in our health system, where they can’t seem to work towards a break-even position, needs to be fixed, but I can’t see how. In fact, there is a risk that it could get worse, not better. So I’d be interested in the Minister’s insights and expectations for how that will run, particularly on asset management, because that’s a very rapidly changing picture in a sector that is driven by technology—medicine technology, high-tech radiology, a plethora of surgical technologies. Who’s going to decide when it’s the right time to upgrade or invest in new technology and how quickly will that happen?

CHAIRPERSON (Ian McKelvie): I call the Hon Michael—Andrew Little; don’t know who I was calling then!

Hon ANDREW LITTLE (Minister of Health): We often get mistaken, Michael Woodhouse and I. Thank you, Mr Chairman. Thank you, Mr Watts and Mr Woodhouse, for their queries. Simon Watts raised three questions, I’ll see if I can dispose of those quickly. Mr Watts is right about—we all foresee the shifting age-profile of our population and therefore that is going to have an impact on health services. Part of what has driven the whole reform process is the need for sustainability, knowing that in our current shape we’d be struggling with sustainability.

As we look at 20 to 30 years out with an ageing population, the way we deliver services is going to have to change. We will end up delivering more services in the home—that’s not a bad thing; there’s a lot of people who want to stay in their home. We know for Māori and Pacific populations, actually, they prefer to be in their home and be around family and whānau. We’ve just got to make sure that the health services and support that allow that to happen are there. And so that, I expect, will have to be part of the planning that goes on.

But I can assure the member that—in terms of Government, whether it’s the Ministry of Health, Treasury, and others whose job it is to look out—thinking about what we need to be doing in 20, 30 years’ time is very much driving what we’re doing. It’s helping drive the structure and helping drive our thinking about what future financing looks like—because the problem’s not going to go away.

In terms of health workforce, again, the member and others in the debate so far in this committee stage have raised the challenge that we have with workforce that are being compounded by a number of issues. In terms of retention, one critical factor is remuneration. We’ve seen the significant shift in remuneration for nurses. We’ve got admin clerical workers who now have agreed on and, in fact, have ratified, their pay equity deal—so that will be implemented. We have allied health workforce about to vote on a routine collective agreement renewal but with commitments about pay equity, and we’re in the process of setting that up.

Those things will help with retention. But I think the other point the member makes, too, is it’s not just pay, it’s conditions as well, it’s the environment in which you work, it’s making sure that you’re working in a health service that is fully staffed—or as close as possible to it. So filling the existing gaps and future gaps remains that challenge, and that’s why the workforce planning and development element of this—and I’m very pleased that the Pae Ora Legislation Committee added in those as statutory requirements for Health New Zealand and the Māori Health Authority to be planning for and be across; it’s very important. So I think the bill covers those needs off.

The third point that Mr Watts raised was just about aged care. I’m confident that we will see a change. There are some short-term challenges, again, around staffing. I think the big challenge that aged care has is the growing differential between the health workers—nurses, health care assistants—who work in the public system versus those who work in aged residential care in the private system. I have made the commitment and we stand by it—we know we have a job to do in terms of pay parity and we’re working on a plan to make sure that that happens. That’s not something that can be dragged out for ever and a day, but there is a commitment to see that through.

To Mr Woodhouse’s questions about meeting the obligation under clause 16 to be effectively fiscally responsible. Look, the challenges that Mr Woodhouse raises are there today. In terms of capital spending, that is heavily centralised anyway. Capital spend is the responsibility of a combination of the ministry and its capital investment committee. The ministry has their health infrastructure unit as well, and the data and digital section of the ministry is responsible for the big IT system investments and what have you. So across the 20 district health boards, and across the multiple hospital campuses we’ve got, there is a prioritisation given; there’s something of a national asset management plan—even if not fully developed—being developed. That sort of device will continue because it will need continue with Health New Zealand.

I think the benefit of Health New Zealand—it can actually start to streamline some of these processes. It will still rely on those with front-end knowledge at each hospital campus. So many of those staff who are there processing payments and dealing with both capital spending and operational spending decisions—they will still be needed and they will feed into the Health New Zealand financial operations system that will be in place to make sure that there is good reporting, good information, and that both the board and the senior management of Health New Zealand are getting the information to make those decisions.

In the end, there is one entity. We will hold that entity to account for effective financial management. And it will leave Health New Zealand to internally manage the various cost centres that it will have. I’d be surprised if it discontinues cost centres around each hospital—it’s essentially the way to set it up. But, in the end, that will be for Health New Zealand. And whatever Health New Zealand does in that respect, they will be judged on the quality of the services given which will reflect the decisions made and the ability for relevant managers, at all levels, to make those decisions with confidence.

So, again, I’m confident. When I look at the team that is assembling within Health New Zealand—and, for that matter, the Māori Health Authority—I’m confident that they will be completely across that. But we must have this discipline around financial management that we’ve struggled to get up to now. We have that now written into the legislation. I think that will help enormously.

Hon MICHAEL WOODHOUSE (National): Thank you, Mr Chair. I do appreciate Minister Little’s reply; it was helpful. I would make one observation and ask a question. Firstly, he was absolutely right: the Capital Investment Committee and the health infrastructure board are there, but they’re there for the really big stuff. It’s there for the rebuild of Dunedin Hospital, Whangārei Hospital, probably Hutt soon, and other major capital expenditure. It’s not really there for the lower-level asset management that goes on in each district health board (DHB) every week. I think there’s probably a task to understand the level of delegation of a lower level of asset management and replacement.

That kind of segues into the question that I have on this, which was: the Minister referred to cost centres. Now, in accounting parlance, there’s a difference between a cost centre and a profit centre, and I just want to know whether the—we’ll call them the localities, using the new nomenclature. Will those localities actually be—I don’t want to call them “profit centres”, because profit’s the wrong word, but will they be allocated funding within which they need to stay, and so will they have the responsibility for managing within, effectively, an appropriation, if you like, from Health New Zealand to a locality, whether it’s a former DHB or something else? And what would happen, and how quickly will there be an intervention, if one of those localities then fails in its endeavour under clause 16 to live within its means?

Hon ANDREW LITTLE (Minister of Health): I think it’s appropriate to just dispose of that question now. I, again, thank the member for it. I think the member’s right. I mean, one thing we don’t want Parliament to do is to start setting up the financial management regime for Health New Zealand. But I think he can be assured that there will be appropriate delegations throughout the health system, the Health New Zealand organisation, and there will be a level of capital expenditure that will be left to local management. It will be whatever the name is given to whoever heads up an individual hospital.

And, indeed, what I would expect to see—which, I think, again, when I look at some district health boards (DHBs), they have struggled with this—is managers at different levels having appropriate delegations. And I am aware of one reasonably large DHB where reasonably senior managers, responsible for reasonably significant operations, had no budget delegations given to them. They just spent as they thought was appropriate to do their job, without any budget within which to operate. So it’s that kind of discipline, if it hasn’t been there before, we need to get quickly back into those organisations.

In terms of costings, I can say to the member that the localities won’t be a cost centre. The locality planning process will be kind of coordinated at the regional level within Health NZ, and is really a basis on which to evaluate health need and informs the basis of the, for want of a better phrase, funding to third parties. So funding to your primary care or your primary health organisations, if they’re there, or your aged residential care, or all those others who get public funding to provide particular services. The locality planning process is kind of an information-gathering and a planning process for which the regional division of Health NZ will then follow with funding and commissioning decisions. Obviously, the way Health NZ will operate is to make sure that the funding of services across New Zealand has a consistency in terms of formula but is about addressing need. And so they will have to kind of weigh that balance out.

So to the extent the member thought there was cost centres around localities, there won’t be. The locality planning process is a planning process from which funding decisions will subsequently be made.

BROOKE VAN VELDEN (Deputy Leader—ACT): Thank you, Mr Chair. I was just hoping that the Minister might be able to provide a little bit of clarity on the structure of the healthcare system as it pertains to Health New Zealand.

When I’m looking through Subpart 2 and it talks about the establishment of Health New Zealand, the objectives, the functions, how it all works with the Iwi Māori Partnership Boards and the Māori Health Authority, there’s an element that I’m not sure is missing or is just intentionally not part of the legislation. And that is, when you go on to the Future of health website, it talks about there being four new regional divisions within Health New Zealand, and I wondered whether these four divisions within Health New Zealand that are regional should be prescribed in the legislation and if there is a reason why they’re not prescribed in the legislation at all.

Has there been a decision made that these four regional divisions no longer exist or do they still fit within the Māori Health Authority and Health New Zealand, then the regional divisions, and then the localities? And if they do exist as four regional divisions, where are they and who is in charge of them? How do they fit within Health New Zealand?

PENNY SIMMONDS (National—Invercargill): Thank you very much, Mr Chair. I would like to return to Supplementary Order Paper 157, which is perhaps a subject dear to your and my hearts, the older persons’ health strategy—no offence intended, of course—and, Mr Chair, this is a matter that I spoke on earlier today. So my questions to the Minister are around this. Given the crisis that we are seeing in our aged-care sector at the moment, surely a reform process such as this and the Pae Ora (Healthy Futures) Bill would want to have included in it a provision that would prevent the sort of dislocation between the aged-care sector and the district health board (DHB) delivery as it is at the moment.

At the moment we are seeing a very, very big sector—36,000 beds in the aged-care sector—that is at crisis point because of something that has happened in the DHB sector. So we all agree that the hard-working nurses deserved their pay increase, but what it has done is create this differential of around $15,000 per annum between a registered nurse in the aged-care sector and a registered nurse in the DHB sector. With the pay equity increases that have now been settled and will come into play, that differential will almost double, and so we have got an aged-care sector in crisis because of what has occurred in the DHB sector. Surely, a bill that is looking at healthy futures would want to hold a strategy for older people that would prevent this ever happening again.

Now, I understand that an older people’s health strategy would be much broader than the aged-care sector, but given the situation that we are currently in, where 700 beds in the aged-care sector have closed in the last few months and the sector is forecasting that it may increase to around 5 percent of the beds in the aged-care sector closing, the impact on the DHBs, on the hospitals, will be enormous if that occurs. That could be up to 1,800 beds closing in the aged-care sector and those residents being placed into hospital care, and the associated issues that would occur with that: the operations that would be cancelled and the procedures that would be delayed because of that sort of bed blocking that could occur. So, surely, a bill that is looking at healthy futures would want to have provision in there to ensure that this dislocation never occurred again and this sort of crisis in the aged-care sector never occurred again.

So I would like an explanation from the Minister, if there isn’t an older people’s healthcare strategy as has been put forward by this Supplementary Order Paper from Dr Shane Reti, as to how it will be managed that we don’t get something like this occurring again in the future. I appreciate that the Minister says he’s aware of the situation and he has made a commitment to pay parity with the nurses, but those of us that recently had a Zoom meeting with aged-care providers saw the absolutely raw emotion and concern on the faces of those providers. They can’t wait weeks or months or years for a Government to go about their possibility of creating relief to this pay equity solution. They are in crisis here and now. They are closing beds, and the welfare of our elderly citizens is being put at risk from this.

So I’d like the Minister to give some assurances to us that somehow this bill, this reformation, will not allow something like this to happen again, and what mechanisms will prevent that? Thank you, Mr Chair.

Hon ANDREW LITTLE (Minister of Health): Thank you, Mr Chairman. I thank the members for their contribution. To Brooke van Velden, who asks about the structure of Health New Zealand in reference to the regions: the interim Health New Zealand, as it is currently established as a ministerial committee, has made it clear that it does intend to operate with a regional level. It has talked about coordinating networks of hospitals in particular regions. That’s one level at which it will operate. Each of those regions will have at least one tertiary hospital as well as the others in it. So they will operate at that regional level and I think they also expect that certainly, when it comes to primary care, those commissioning decisions will be made at a regional level, and that will make sense for the locality planning authority also to be coordinated at that kind of regional level. In the end, you would expect an organisation, a single organisation, must be able to determine its structure and its organisation, and it will do that.

To Penny Simmonds, with all due respect, I think what Penny Simmonds is asking for is to legislate for perfection into the future, and of course that’s not going to happen. I think what I would say by way of reassurance is that we are in a transition. I would hate to think that Ms Simmonds and her party are arguing for us to slash the wages and incomes of nurses in the district health board (DHB) sector to avoid the problem that the aged residential care are talking about. There’s always been a differential between nurses in the DHB sector and nurses in the funded sector: aged residential care and primary care. That differential has got a little bigger because we are desperately trying to catch up and make sure nurses in the DHB sector are properly paid, because their pay went backwards in real terms under the previous Government, and we’ve negotiated a pay equity deal and eventually that will come to fruition as well as we’ve been negotiating other pay equity agreements.

We’ve made the commitment to then work with the funded sector to bring their rates up to speed as well. There needs to be a process for that, and there is. They need to collaborate in that as well. I think what’s important is that everybody, all players in the sector, focus on what is needed, focus on what the goal is, and that is to ensure that we, to the best extent, can avoid any undue disruption and any undue fracture of the labour market in that particular sector. That’s important. That’s what we’re committed to. That’s why officials and others have been engaging with the sector to make sure that that’s what we are able to achieve.

But we know that for the sake of retention and for the future workforce, we have to substantially lift incomes. We do that through the pay equity process. For one thing, we shouldn’t have large chunks of the health workforce paid on rates of pay that are historically discriminatory, and that’s what we are taking the historic step of starting to turn back. We will go through a transition where there will be a little bit of unevenness, but this is about lifting incomes in the health sector for those who for so long have been discriminated against and have been underpaid and undervalued for the work that they do.

MELISSA LEE (National): Thank you, Mr Chair. I’d like to ask the Minister a couple of questions in relation to the ethnic communities. As someone who hasn’t actually participated in this debate from the beginning, I was just sitting in my chair listening to the contribution that other members have actually been making and I thought, “Where are the questions about the ethnic communities?” I know that there are provisions actually made for Māori and Pasifika communities, but there’s nothing in there about ethnic communities, particularly the Asian communities, because I come from that sector.

If you look at the Auckland region, for example, the Asian population in Auckland is about 30 percent, and it is actually a very fast-growing population. And for many of them, one of the biggest problems that they have when they’re engaging with the health system, is that, one, they have language issues, and, two, they feel that the New Zealand health system doesn’t actually understand their needs. They have medical professionals—whether it’s doctors or nurses or midwives or whatever—who actually do not understand. They have different terminologies, for example, in Korean. If you have pain in certain areas—I mean, the elderly people talk about the wind or the sourness in their bones and, you know, they say that like that in their own language. And often the translation services are actually not effective enough, I don’t think.

I’m trying to find out if the Minister has put specific provisions for this new entity to provide for the needs of the ethnic communities in New Zealand, and what kind of provision he has actually made, particularly—different ethnic communities have different health needs. They have specific—what would you call it—susceptibility to certain diseases, and I’m wondering what the Minister’s projection is in terms of what the attendance rate will be to these health entities by the ethnic communities, preventing them from going back home to their home countries to get services because they feel that those countries actually provide better healthcare than New Zealand currently does.

HARETE HIPANGO (National): Thank you, Mr Chair. Minister Little, this evening I too have sat and listened, and rise to take this call in my spokesperson role for children. When I turn to the title of this bill, Pae Ora (Healthy Futures) Bill, of course my mind and my heart turn to: where’s the children’s interest in this bill? And, interestingly, Minister, this morning on the Social Services and Community Committee there was scrutiny of the oversight of the Oranga Tamariki systems bill, the Oranga Tamariki Amendment Bill. At a cursory glance at the bill, I am concerned that there is no reference to or mention of the future of our country, Aotearoa New Zealand: our children. We have a ministry in Oranga Tamariki. This “pae ora” bill is about the healthy futures. So, Minister, I invite due consideration, particularly in relation to clause 10, which is the overview of the Minister’s role; particularly Subpart 5 of Part 2, which is under debate this evening, “Key health documents”, from clause 29; and then, particularly, “Health strategies”, from clause 37 onwards—detecting, denoting, Minister, with the Supplementary Order Paper that was filed under your name this evening, the inclusion of the rural communities and also of women with a women’s health strategy. And then there has been discussion more recently this evening in terms of aged care, our older generation.

So, Minister, in my spokesperson role for children, I am concerned, and particularly note, Minister, you did make mention, in reference of the collaborative approach that has been taken with other Ministers—the Minister for Māori Development; seated beside you is the Associate Minister of Health (Māori Health), also the Minister for Whānau Ora; and also one is expectant that there may well have been a discussion with your colleague the Minister for Children. They are our future, and it is important that there is a healthy future, and this bill is named that—Pae Ora (Healthy Futures) Bill.

Minister, also, may I just allude to the importance of, across the public sector, the strategy that this Government has engaged and implored and required in terms of a child-centric approach to the formulation of policy—Government policy—but also legislation. So I turn to child impact assessments. The Minister for Children has indicated, in terms of child-centric legislation—the oversight of Oranga Tamariki systems bill that is under scrutiny at the moment—the importance to use the child impact assessment tool when developing policy and legislation that impacts children. So, Minister, I am concerned, and I do invite you, in your position of responsibility in the ministry, to turn one’s mind, in the formulation of a new health system, in the formulation of new health legislation, to ensuring that there is an element of child-centric approach to that with a strategy. It’s been particularly identified, the relevance and significance of women’s health; and, again, Minister, I invite and reiterate and emphasise the importance of children’s health.

Just concluding my kōrero thus far, I just happened to turn to a whakataukī which is relevant in terms of the old net being cast aside—which is what’s being done in terms of the design of the health system, primary and secondary healthcare—and the new net being cast. And the kōrero whakataukī is ka pū te ruha ka hao te rangatahi [And the proverb states the old fishing net is cast aside and the new net goes fishing.]

So, Minister, I implore the importance of a child-centric approach with a strategy of health to encompass, to embrace, our children, our youth, our tamariki, our rangatahi. Kia ora.

Hon ANDREW LITTLE (Minister of Health): Thank you, Mr Chair, and I thank members Melissa Lee and Harete Hipango for their contributions, and, hopefully, I can respond as quickly as I possibly can.

To Melissa Lee’s concerns about provisions for ethnic communities, I refer the member to a number of provisions in the bill. Clause 14(1)(h) provides for—it says, “(1) The functions of Health New Zealand are to— … (h) improve service delivery and outcomes for all people at all levels within the publicly funded health sector;”. And I refer also to clause 7 of the bill, which sets out the health sector principles, and one of those principles, under clause 7(1)(d), is that “the health sector should provide choice of quality services to Māori and other population groups, including by— … (ii) providing services that are culturally safe and culturally responsive to people’s needs; and (iia) developing and maintaining a health workforce that is representative of the community it serves;”. So I think there’s a statutory requirement, as Health NZ and the Māori Health Authority, to develop health services to make sure that both the health services are culturally appropriate and safe and that we have a workforce that meets those particular population needs.

I might also add that the Government policy statement is about ensuring that the health services provided for and the Government policy statement itself meet the objectives of the Act, which of course, is set out in clause 3 of the legislation. Clause 3, in terms of the purpose of the Act, expressly states: “The purpose of the Act is to provide for the public funding and provision of services in order to—(a) protect, promote, and improve the health of all New Zealanders;”. So everybody is catered for in that respect. I’m not aware of any Supplementary Order Paper that is calling for a specific ethnic community’s strategy or a strategy for any particular ethnic community.

When I look in practise, I look at, for example, the Waitematā District Health Board (DHB), who at the moment have an Asian directorate, effectively, and a specific focus on meeting the needs of their Asian population. One of the challenges we’ve had with the system as it currently is configured is that good innovations like that are very, very difficult to migrate across the system as a whole. So, certainly, my expectation is that I want, when Health NZ and the Māori Health Authority are properly set up, that they have an opportunity to pluck the really good stuff out of each form of DHB and actually make that a practice across the organisation as a whole where there are concentrations of ethnic communities—to replicate what the Waitematā District Health Board has done in relation to their Asian people strategy.

To Harete Hipango, about children, I acknowledge the comments she has made. I think there’s a range of legislation that places an obligation on the State, where it is engaging with children in a whole variety of different contexts, to put children first, and so there’s no question about that. And when it comes to health services, again, for the reasons I’ve pointed out in relation to Melissa Lee’s comments, there will be an obligation on Health NZ and the Māori Health Authority in the delivery of services to make sure that they are safe and appropriate and relevant to the patient population that they are delivering their services to. So I’m confident that the needs of children will be well catered for. I think that, when it comes to the planning processes, the Government policy statement, the New Zealand health plan, and the various strategies that come out of the Government policy statement, the needs of children will be well catered for.

MELISSA LEE (National): Thank you, and my apologies to my colleague behind me, Simon Watts. As somebody who doesn’t, actually, normally sit on the Pae Ora Legislation Committee or speak on this and is actually getting some attention, I’m sure your turn will come, Mr Simon Watts. Very quick question to the Minister in response to the answer he’s actually given me. I’ll try and make it very succinct and short. When the Minister actually says that the commitment is actually there to make sure that the new entity will provide for all communities, that doesn’t actually tell me that there has been work done by your officials or yourself to actually project and be ready when this entity is actually launched and that the services will be available for those communities. I’m trying to find out if, in fact, there was work done to project to the future as soon as the new entity is actually ready: what kind of services will there be, what percentage of the population may potentially use it, and what kind of language services are required for those services? To tell me that there are current, new, and good examples in the Waitemata District Health Board and that you can’t necessarily transplant it into a new one. Yes, I probably agree with him, but the thing is that that doesn’t actually mean that there’s been some thought put into a population that is really, really massively growing and growing really, really fast, and I’m concerned that their needs—the ethnic communities’ needs—are not going to be met by this new entity.

WILLOW-JEAN PRIME (Assistant Whip—Labour): I move, That the question be now put.

SIMON WATTS (National—North Shore): Thank you very much, Mr Chair. I’m just wanting to ask three questions in regards to Part 2, clause 16(1)(c), which relates to financials in regards to the DHB, and then come on to clause 16(1)(d)(i), which is around capacity and capability.

Firstly, in regards to the fiscal aspect, my question for the Minister is in regards to how the centralisation and the forming of Health New Zealand is going to create a significantly bigger entity than the individual district health boards (DHBs) themselves. The challenge, potentially—I’m interested in his perspective around that—is: how will the threshold for materiality change in regards to that entity? Why I ask that is that, and it’s getting into a little bit of detail, is that one of the significant drivers of DHB deficits has been holiday pay. The other element there around holiday pay is the other contingent liabilities that relate, and the fact that, actually, there is an element of that holiday pay that hasn’t been necessarily quantified and the role in which the Ministry of Business, Innovation and Employment play in order to, in effect, provide opinions and decisions to DHBs around the quantum or how they should respond to an issue around a contingent liability, such as holiday pay, and, therefore, the burden of that liability falls on the DHBs. In the current model, because the 20 DHBs look at that in terms of their scale, which is smaller, they pay a lot of attention to it. But the challenge and the concern I’ve got around a large centralised entity is that those numbers will become, while significant, less material in the context of a single organisation.

Therefore, how do we ensure, in terms of clause 16(1)(c) around financial sustainability, that aspects around contingent liability won’t actually get lost? Don’t forget that those are the liabilities that aren’t actually expensed, they’re not ones that are included within the deficit; they sit outside of that, but sometimes they can be a ticking time bomb in terms of the fiscal impact that will either be inherited by a future Government or a Government will need to make some decisions around how they treat for that. So that’s the first part.

The second part is around the point that was raised before around novation of assets, and I think my colleague Michael Woodhouse referenced this. I’ll give you an example, it’s the Auckland Regional Dental Service—ARDS—which provides dental services to school-based children in Auckland. It is a combination of three DHBs: Auckland DHB, Counties Manukau DHB, and Waitematā DHB. The ownership of those assets that provide those services is a mixed model, some of which are owned by different DHBs; some of it is land leased from different schools in Auckland. There is a very complex arrangement of asset ownership.

My question for the Minister is in regards to the transition costs of novation of those assets to the single-entity model and the time it takes to actually unwind that, and, actually, the reality that, in most cases, the outcomes don’t necessarily change but there’s a cost burden to transition. How has that been considered in regards to, again, the financial sustainability around clause 16(1)(c)?

The last element is in regards to clause 16(1)(d)(i), which states that the health entity will need to have “the capacity and capability” to deliver it. We had a question before around the fact that we couldn’t quantify—I think Dr Reti mentioned—around health need. But how are you going to be able to measure the fact that the health entities—and I quote—“has the capacity and capability to perform its functions”—16(1)(d)(i)? That is a huge statement in the context of delivery of healthcare services in this country. Therefore, what is the monitoring, the measurement around that? We’ve got significant deficit around service provisions in parts of our country, which I’m sure we’ll get into soon. But how are we actually going to affect that clause, in reality? It’s quite aspirational to say that, one, you’ll have the capacity, and we know that operating theatres around the country are closed because they’ve got no staff; but, secondly, to have the capability, which then gets into workforce, which, again, as you’ve just articulated earlier, we’ve got significant gaps in that space. So can you give us a little bit of clarity around how that clause within Part 2 is actually going to be effective? I’ll have a few more questions.

Hon ANDREW LITTLE (Minister of Health): Thank you, Mr Chair. Just responding to Melissa Lee’s second contribution and also to Simon Watts’ second contribution. To Melissa Lee, I don’t wish to be repeating myself, as she has done, but the provisions are very clear in the bill about what is expected. All population groups must be taken account of and services must be available in a way that is culturally appropriate and safe. That will include, where needed, language services. I don’t think the member was being dismissive of what Waitematā District Health Board (DHB) is doing. It’s actually a very good service and I would like to see more of that in other places where that is an appropriate model to adopt that. But I think there is provision in the bill that both signals it and will allow it to happen.

To Simon Watts’ three points, I think, that he makes: first of all, on the holiday pay issue and the liability that creates—and he will be aware of it, because he probably was involved in trying to counter it at some point—that work has considerably progressed. I think one of the challenges, and he may well know, that we had is that different DHBs had different interpretations of the provisions in their respective collective agreements and how that was to apply. That’s part of the problem. With a single employer, we then have the recipe for a single consistent interpretation of contractual obligations. So the risk of that problem replicating is very low. And even if with a single organisation they did get the interpretation wrong and somebody went to the Employment Relations Authority or the Employment Court and got an interpretation that was different, everybody will have suffered the same kind of misinterpretation by the employer and that can be rectified across the board as opposed to having to rectify 20 different approaches that have been taken with that. So I’m confident that actually we won’t see a failure to address contingent liabilities that we know are there and upon which work is being done.

I think the member also asked a question about the materiality threshold for those liabilities. Again, I don’t think it’s for Parliament to start planning the financial systems for Health New Zealand. They will take appropriate professional advice including from chartered accountants, who will give them advice on how to set those appropriate thresholds and delegations. I don’t think the contingent liabilities will be lost. I don’t think the Audit Office would allow it to happen.

In terms of the example the member gives of the Auckland Regional Dental Service—mixed ownership of assets, different DHBs, land owned by the schools—the legislation makes clear about the transfer of assets, including real assets, so that will happen. There may be some conveyancing to be carried out, but there’s no question about who the owner will be or who the owner will transfer into where there needs to be a registration of that ownership interest. But otherwise contracts will transfer legislatively, so the cost for that is minimal. I don’t see a major challenge with that.

Finally, in terms of capability and capacity, the member raises an interesting point. But I think it is important. You know, this is the challenge that we’ve had. The boards have got to make sure their job is running health services and that we maintain health services in a way that means that they’ve got the capability and capacity to deliver those services. There’s always going to be variability in the margins, and there’ll be times where there might be a larger number of vacancies than is desirable. You’d want as stable a workforce as possible. But it is for the board with management to make sure that challenges are met, to make sure that the capacity is there to deliver, and as that changes and as they forecast the future, they’re planning for that change.

I think that’s one of the shortcomings with the current system. We’ve relied on 20 different operators of health services to do that and they simply haven’t done it, been able to do it, and we haven’t had a ministry be able to drive them to do it. Health New Zealand, with a single entity, gives us a much better chance of getting on top of that in a much better way.

BROOKE VAN VELDEN (Deputy Leader—ACT): Thank you, Mr Chair. I’d just like to pick up on a few comments that have been made around the Chamber, in particular, talking to Melissa Lee’s point about ethnic communities.

I think it is really important that in New Zealand we are not just Māori and everything else. Everything else isn’t just white. We aren’t the 1950s any more. We have actually moved on, and we are a society of about 260 different ethnicities. I do have a point to be made there, that the Minister says, “Well there is relevant ability for different ethnicities to be considered in parts of the legislation because they are New Zealanders and different parts of the health strategy refer to different population groups and the needs of different New Zealanders.”

Well, if it’s all right for Asian members of our society, why is it different for the Pasifika and the Māori people that have been singled out in this legislation?

SHANAN HALBERT (Labour—Northcote): I move, That the question be now put.

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

Ayes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 42

New Zealand National 32; ACT New Zealand 10.

Motion agreed to.

CHAIRPERSON (Ian McKelvie): The question is that the Minister’s amendments to Part 2 set out on Supplementary Order Paper 169 be agreed to.

Amendments agreed to.

CHAIRPERSON (Ian McKelvie): The question is that Dr Elizabeth Kerekere’s amendments to Part 2 set out on Supplementary Order Paper 164 be agreed to.

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

Ayes 12

Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 107

New Zealand Labour 65; New Zealand National 32; ACT New Zealand 10.

Amendments not agreed to.

CHAIRPERSON (Ian McKelvie): Debbie Ngarewa-Packer’s amendment to clause 43B set out on Supplementary Order Paper 172 is ruled out of order as being inconsistent with the previous decision of the committee.

The question is that Debbie Ngarewa-Packer’s remaining amendments to Part 2 relating to the Māori Health Authority set out on Supplementary Order Paper 172 be agreed to.

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

Ayes 12

Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 107

New Zealand Labour 65; New Zealand National 32; ACT New Zealand 10.

Amendments not agreed to.

CHAIRPERSON (Ian McKelvie): Brooke van Velden’s amendments to Part 2 set out on Supplementary Order Paper 153 are ruled out of order as being inconsistent with a previous decision of the committee.

The question is that Debbie Ngarewa-Packer’s amendment to Part 2 inserting a new subpart (3B) relating to a Māori Director-General set out on Supplementary Order Paper 167 be agreed to.

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

Ayes 12

Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 107

New Zealand Labour 65; New Zealand National 32; ACT New Zealand 10.

Amendment not agreed to.

CHAIRPERSON (Ian McKelvie): The question is that Dr Elizabeth Kerekere’s amendments to Part 2 requiring the Minister consult with relevant Ministers on health strategies set out on Supplementary Order Paper 165 be agreed to.

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

Ayes 12

Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 107

New Zealand Labour 65; New Zealand National 32; ACT New Zealand 10.

Amendments not agreed to.

CHAIRPERSON (Ian McKelvie): Brooke van Velden’s amendments to Part 2 relating to a rural health strategy set out on Supplementary Order Paper 151 are ruled out of order as being the same in substance as a previous amendment.

The question is that Brooke van Velden’s amendments to Part 2 relating to a medicines strategy set out on Supplementary Order Paper 152 be agreed to.

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

Ayes 42

New Zealand National 32; ACT New Zealand 10.

Noes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Amendments not agreed to.

CHAIRPERSON (Ian McKelvie): The question is that Dr Elizabeth Kerekere’s amendments to Part 2 relating to a rainbow health strategy set out on Supplementary Order Paper 154 be agreed to.

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

Ayes 44

New Zealand National 32; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 75

New Zealand Labour 65; ACT New Zealand 10.

Amendments not agreed to.

CHAIRPERSON (Ian McKelvie): The question is that Dr Shane Reti’s amendments to Part 2 relating to an older people’s health strategy set out on Supplementary Order Paper 157 be agreed to.

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

Ayes 42

New Zealand National 32; ACT New Zealand 10.

Noes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Amendments not agreed to.

CHAIRPERSON (Ian McKelvie): The question is that Dr Shane Reti’s amendments to Part 2 relating to a health workforce development strategy set out on Supplementary Order Paper 158 be agreed to.

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

Ayes 54

New Zealand National 32; Green Party of Aotearoa New Zealand 10; ACT New Zealand 10; Te Paati Māori 2.

Noes 65

New Zealand Labour 65.

Amendments not agreed to.

CHAIRPERSON (Ian McKelvie): The question is that Matt Doocey’s amendments to Part 2 relating to a mental health and wellbeing strategy set out on Supplementary Order Paper 170 be agreed to.

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

Ayes 54

New Zealand National 32; Green Party of Aotearoa New Zealand 10; ACT New Zealand 10; Te Paati Māori 2.

Noes 65

New Zealand Labour 65.

Amendments not agreed to.

CHAIRPERSON (Ian McKelvie): Matt Doocey’s amendment to clause 43B set out on Supplementary Order Paper 171 is ruled out of order as being inconsistent with a previous decision of the committee.

The question is that Matt Doocey’s remaining amendment to Part 2 relating to consultation with the Mental Health and Wellbeing Commission set out on Supplementary Order Paper 171 be agreed to.

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

Ayes 54

New Zealand National 32; Green Party of Aotearoa New Zealand 10; ACT New Zealand 10; Te Paati Māori 2.

Noes 65

New Zealand Labour 65.

Amendments not agreed to.

A party vote was called for on the question, That Part 2 as amended be agreed to.

Ayes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 42

New Zealand National 32; ACT New Zealand 10.

Part 2 as amended agreed to.

Hon ANDREW LITTLE (Minister of Health): I raise a point of order, Mr Chairperson. I seek leave to correct a statement I made earlier this evening, as we’ve been discussing this bill.

Hon Michael Woodhouse: Was that in the committee?

Hon ANDREW LITTLE: In committee. Earlier this evening, Michael Woodhouse made a contribution in relation to the provision in the bill relating to amending the immigration provisions, in particular a condition attached to visas for those who are working in the health system. My response was to the effect that I thought that any problem with a health worker on a working visa, employed by Health New Zealand, who might want to go to other parts of the country with Health New Zealand—that would be managed as an HR matter. I said, tangentially, that under the new arrangements with the new work visas, a health worker employed or at least under a working visa on the two-year pathway to residency, as now provided for, would, as a condition of the visa, be required to stick with their employer. I have been advised tonight that that is not correct and that a health worker, working here under a two-year visa on a pathway to residency, once they are here is free to work in the role in which they are employed, regardless of who that employer is. I just wanted to be very clear about that.

Part 3 Other roles

CHAIRPERSON (Ian McKelvie): Members, we now come to Part 3. This is the debate on clauses 60 to 86, “Other roles”, as well as Schedule 1A relating to organisations for the purposes of sections 84A(1) and 84B(1), and Schedule 4, which has provisions applying to mortality review committees. The question is that Part 3 stand part.

Hon ANDREW LITTLE (Minister of Health): Just by way of some just general remarks in relation to this provision, members will recognise some of the entities referred to here. This simply recognises the continuation of these particular entities. But it’s in this area too that we also have some other particular provisions—and I’m just looking specifically—in relation to the new public health agency and, specifically, the expert advisory committee on public health that is provided for.

Part of the reforms is to beef up our public health offering and to make sure that we have good—which is not a criticism of any leadership we’ve had in our public health services to date. But this makes it clear as part of the structure that we will have a discrete public health agency with an external advisory committee who will be advising in that particular service.

Also in this regard—or, in fact, not in that regard at all. But, yeah, I do want to draw particular attention to that. Otherwise, the other organisations here: Pharmac, Health Quality and Safety Commission, New Zealand Blood and Organ Service—they’re all provided for here. They all must continue. They are service providers and, therefore, they are health entities for the purposes of the legislation.

Dr SHANE RETI (National): Thank you, Mr Chair. I rise to speak to Part 3, starting at clause 60, and I particularly want to focus my contribution around Pharmac.

This has relevance for the Pharmac report that came out today, which tells us several things—the “what”, if you like, is the problem with Pharmac. First of all, one, poor performance across the whole organisation is what the report tells us. Secondly, the cost savings are not what we’ve been told by Pharmac. Thirdly, it’s highly likely that Pharmac has contributed to inequalities in the health system. That’s the identification of the problems.

The “why” part to that—well, that’s probably multi-factorial, we know from the interim report, where Pharmac was described as having a fortress mentality. It’s not prepared to share information and, in fact, it wasn’t even prepared to share with the review panel. It’s a problem, which, again, is highlighted in today’s Pharmac report. Secondly, it’s pointed out today that they don’t well incorporate the consumer voice, so much so that their clinical advisory committees, which includes the Pharmacology and Therapeutics Advisory Committee, are being reconfigured, and, instead of being internal assignments, are actually going to be ministerially appointed.

I think, myself, personally, one of the problems with Pharmac is they’ve been allowed to be isolated and too far from ministry and ministerial oversight. The example I have with this—and I know I’ll need to get over it some time. But the 20,000 meningitis vaccines that were hidden, that Pharmac hid from the director-general, and, I believe, the Minister as well in the 2018-19 Northland meningitis outbreak—that’s a good example of Pharmac being way too isolated, its own little fiefdom, which I think has contributed to the report today.

As we look to some of the solutions that are proposed, particularly in the Government response, a large number of them say that this will be taken up by what we’re talking about here: the Pae Ora (Healthy Futures) Bill. Well, that’s kind of rich considering, going into select committee, Pharmac was excluded from the Pae Ora (Healthy Futures) Bill, and now it’s the solution to a substantial number of problems that are raised in the report? That’s really rich.

I think what we then need the Minister to assure us around is several things. First of all, I want to express concerns for delays in upgrading the national medicines strategy, which expired in 2020, and, indeed, we’re in support of our colleague with ACT and their Supplementary Order Paper around this today. The report describes it as a priority and states in as many words that its omission will be a significant failure for the health reforms going forward. So those words should be taken into account by the Minister as he reads that report.

But I think fundamentally what I really would like some reassurance around is whether the bill as it is here tonight adequately takes into account all the concerns that have been raised in this report, bearing in mind the Minister had it around about 28 February. Substantial parts of this bill would have been progressed by then. How do we know that the report today, retrospectively, is adequately taken into account by this bill? That’s the sort of assurance I’m looking for from the Minister. Thank you.

Hon MICHAEL WOODHOUSE (National): Thank you, Madam Chair. I want to continue that discussion about Pharmac because today is an important day in terms of that organisation.

I also want to put on record that I think Pharmac, as a model, is a very effective one, but we’ve known for years that three things Pharmac needed: it needed more money, it needed to make decisions in a more timely manner, and it needed to be more transparent about those decisions. Dr Reti and I have made these points very clear to the chair of the Pharmac Board in annual reviews over the last few years—the Hon Steve Maharey—and we got those assurances back. But today’s report, I think, makes it very clear that there is a great deal of work to do.

We are a little bit on the road regarding funding with Budget 2022, although I want to point out—and this is one of the opportunities I think Health New Zealand really has. I’ll use this as an example: a couple of years ago, there was a very strong push for devices to be purchased for type 1 diabetics to, effectively, keep them out of hospital. It was turned down and it was turned down because it was very, very narrow grounds for cost benefit, and yet the real benefit was going to be on the DHBs. This is the one thing I think that’s good about this bill, because I don’t think we’re heading down the right road in terms of the restructure, but, actually, if Pharmac takes more cognisance of a broader range of benefits than just its own cost benefit, I think that’d be a good thing.

When the Minister responded to the report this morning, he said, “Well, we’ve got this health reform and it’s going to be in place in a month, and so that’ll give us a good chance to”—I think he used the word “reassess”. We’ve got a unique opportunity right now to build in a statutory framework to make Pharmac more responsive, more transparent, and more broad in its approach to cost benefit.

My question to the Minister is in the time he’s had available—because he’s had the report for a lot longer than we have—what thought did he put into making amendments to Part 3 that will actually make those recommendations a statutory requirement in the law? We’ve got time because they’re pretty straightforward, I think. Has he given that thought, and, if not, why not? If he decided not to make any changes right now, are we missing an opportunity?

Hon ANDREW LITTLE (Minister of Health): Thank you, Madam Chair, and I thank Dr Shane Reti and the Hon Michael Woodhouse for their contributions. There’s a lot of what Dr Reti said I actually agree with in relation to Pharmac, and I think the concerns about Pharmac’s sort of isolation have been around for a while, let’s be brutally honest. I’m not going to blame politics here. It was because of the crescendo of concerns around it. That’s what prompted us to think seriously about a review. Promises were made on the campaign trail in the last election from both sides of the House, and so we committed to the review.

What I took from the report was that, rather than Pharmac being solely responsible for everything to do with medicines and pharmaceuticals, actually you did need a broader framework within which to consider that. It is properly the province of the ministry, as the overarching sort of steward of the system and the centre of policy and intellectual capacity for the health system, to actually be leading that work, and the review report said that specifically in relation to vaccinations, but, actually, it needs to be for medicines as well.

So part of what we’ve agreed to in relation to the independent review is that Pharmac will be required to work closely with others—in particular, the ministry—and I’m confident that we will now see that. So the member asks does the bill take account of the concerns in the report, and I’m confident that it does. I mean, bearing in mind that at the time I had the report, the bill was fully in the possession of the select committee, so it wasn’t a question of fiddling around with the bill before we introduced it to the House.

Pharmac very early on—in fairness to them—said they didn’t understand why they were excluded in the first draft of the bill from being regarded as a health entity for the purposes of the bill and, therefore, subject to the health sector principles. They now are. They’re defined as a “health entity” and they are now subject to those health sector principles. So I think it does—those health sector principles will make a significant difference to the way that board and its management will have to conduct themselves in Pharmac.

To Michael Woodhouse: again, Woodhouse raises some important questions about that and, again, he asks whether I had given thought to any further changes in Part 3. I’m confident that no further changes were required. The critical thing is that Pharmac is treated under this bill—the piece of legislation for the health system—as part of the health system, and even though they are under the Public Health and Disability Act 2000 at the moment, like most things in that Act, their isolation is almost confirmed. They cannot possibly be isolated given the way this bill is drafted and the structure that we’re setting up, and in any event, it will be partly this statute but partly also the political process will drive them to have to integrate properly with the rest of the health administration in order for them to do their job properly, because I don’t think they’re going to be able to avoid it.

With the Māori Health Authority, because it will have some intellectual capacity as well as its developing policy and strategy for greater equity performance and improvement, they will have a critical role to play in their engagements with Pharmac to see that Pharmac lifts their equity performance as well. So my point would be that it is covered off in the legislation as it is.

SIMON WATTS (National—North Shore): Thank you very much, Madam Chair, and thank you to the Minister for those contributions. I want to dig a little bit deeper into Part 3, clause 62(1)(c) in regards to operational budget, and I guess the broader theme here is in regards to—I think we’d all acknowledge one of the challenges with Pharmac and the way in which it operates. What I’m wanting in my question for the Minister is why haven’t we gone further in regards to this aspect. Is it that when benefits are calculated in regards to the benefit payback from the introduction of a pharmaceutical drug, the benefits generally are only those related to the health sphere related to that drug but do not go broader to other benefits? What I mean by that is the provision of pharmaceutical medication may, in effect, allow someone to go back into the workforce, and so the benefits in terms of the economic benefit of someone working or not is not necessarily going to be felt within the healthcare system, but it may be felt within, potentially, the welfare system, because that person would transition from welfare into a paid job.

The other aspect is in regards to pharmaceutical provision for mental health conditions, or even those in regards to paediatrics and children, and which allow them to have better outcomes in terms of their learning ability at school, or the fact that a mental health condition may restrict their ability either to work or to contribute in terms of society. Again, the way in which Pharmac assesses the benefit case for the investment regarding that pharmaceutical drug is solely restrained and constricted to the health sphere. In effect, when you stand back and look at it, you go, “Well, that doesn’t feel right.” That doesn’t meet that litmus test around the fact that benefits don’t just derive within a single bucket; they actually fall across other aspects of our system, and I think the Government have shown through the justice cluster that they’ve brought in in Budget 2022 a bit of an insight in terms of acknowledging that there are shared benefits across multiple sectors.

I guess my question for the Minister is: can we expect to see something, even within acknowledging health is a challenging area, but with the Pharmac aspect in terms of a cluster, because I think the reality of cost-benefit payback and benefit not just being financial but other aspects, of course—around social, particularly—is significant in the pharmaceutical space. When you weigh it up in terms of dollar for dollar for, say, road safety versus pharmaceutical and the benefit derived, pharmaceuticals will trump most other elements nine times out of 10. So that’s the first aspect.

The second aspect is in regards to clause 64(1)(b) which relates to consumer advisory committees. The Minister will be aware that, actually, the legislative requirement around having a consumer panel has existed and is in place at the moment. The reality is, though, that Pharmac has just simply not taken that as far as it could have done, and, actually, the reality of having the clinical committee has really trumped, and the Consumer Advisory Committee, while it has been there, has really been not of any significant substance. But the challenge, going back to point made by the Hon Michael Woodhouse around consumer input and being part of the Health Committee—I see Dr Liz Craig down the back, a fellow member on the Health Committee last year with me—is that of the petitions that you would receive on that, 90 percent of petitions coming through that relate to Pharmac and Pharmac-related drugs.

So the element around consumer advice or the lack of that consumer input is a known significant gap in regards to the policy consideration but also, I think, the funding prioritisation of pharmaceutical drugs. My question for the Minister is: how are you going to actually measure or ensure that this actually occurs, because that’s the case today, and it’s not happening. So what confidence can we and consumers out there get in terms of, whether we’re talking about rare disorders, or we’re talking about type 1 diabetics looking for the provision of funding for continuous glucose monitoring systems, which is the next phase above insulin pumps—what is the ability for those consumers to be able to have a voice as part of that process, and what will change as a result of this legislation, in particular, in clause 64(1)(b), that, actually, will make that a reality? Those are the two points I wish to ask.

BROOKE VAN VELDEN (Deputy Leader—ACT): Thank you, Madam Chair. I also wanted to touch on Pharmac today, given that, obviously, we’ve had the final review finally released by the Minister of Health, after he’d sat on it for over four months, much to the disappointment of many patients in New Zealand. But I wanted to raise the issue of the fact that Pharmac is not very transparent—we know it’s not. We know that they have been having terrible processes, like the Pharmac review pointed to, such as that the decision that was made around whether new drugs should or should not be funded was made by staff members and not by people who are experts in the field of medicine. There are a lot of processes going on within Pharmac that many New Zealanders would have issue with, and I have been advocating strongly for a medicines strategy to be put into the health legislation here.

But when it comes to Pharmac itself, one aspect that I’d like to get a little bit more clarity on is his previous comments that he’s considered the Pharmac review and deems that there’s no need for any change, and I just wonder how much insight the Minister really has, and has he actually considered the report at all? I wrote a question to the Minister back in February, asking, “How will the recommendations in the Pharmac review panel’s final report, if any, be captured in this bill as it goes through Parliament?” The Minister said at the time, “In view of the interim report, I’m satisfied that the issues identified in that report will be adequately addressed.”, and I just wonder whether at any point since the interim report and the final report any more consideration has actually happened, or is it simply the case that the Minister never really wanted to do this review? The Government were put into the situation where they needed to do it, because the ACT Party asked for it on the campaign trail because of patients. He’s hidden the report. He hasn’t really actually read it in any great detail and, therefore, we have no changes in the legislation.

But based on that, I’d also like to raise an issue just on how Pharmac will operate with Health New Zealand and the Māori Health Authority, because under the current system the district health boards and Pharmac have a memorandum of understanding, and there are issues and areas that they overlap on. I’m just curious whether there has been any acknowledgment of how Pharmac will operate with Health New Zealand and the Māori Health Authority, bearing in mind that the Pharmac review said that for the proper integration of Pharmac or closer integration into the new health system, it was incredibly important that there was a medicines strategy that guided how Pharmac operates under Health New Zealand and the Māori Health Authority.

So given that there is no medicines strategy, the Minister doesn’t want to put one in here, and there appear to be not really any changes to Pharmac at all, is the Minister aware of how Pharmac will operate with the Māori Health Authority and Health New Zealand to be more transparent and to have a better process for how we fund and allocate resources for new modern medicines, because I think the people of New Zealand will be very interested in knowing how any of this and any new medicines strategy will work. Will we actually have a better process in place for new medicines access than we have in the current system, or is it the case that, actually, things will really be just exactly the same as they are?

Hon ANDREW LITTLE (Minister of Health): Thank you, Madam Chair. I thank again Simon Watts and Brooke van Velden for their questions. Simon Watts covers three points. He asked whether, such as we have seen in the justice sector, we will see something like a cluster around Pharmac. I think this will be a common theme in my answers for this next section, but both this bill and the effect of the sort of integration of Pharmac within all the entities that make up the public health system means that they will have to operate in a way that engages actively with each, so the bill will drive them to be part of the health cluster. The health cluster is, effectively, defined in the clause dealing with definitions under the term “health entity”. So I’m confident that they will.

Secondly, Mr Watts notes and shares his observations about the Consumer Advisory Committee and whether or not it is really being allowed a voice to be provided by consumers to Pharmac. I think the review report makes it pretty clear that, actually, Pharmac, in its decision making, has really—to be charitable—struggled to incorporate the input of the Consumer Advisory Committee and, indeed, other groups that they’ve set up like the rare disorders committee that they set up. That met infrequently, it didn’t have somebody with lived experience on it—those sorts of things. So I think that’s out now and that’s recorded in the review. I think that’s an area that does need to change, and we made it clear as a Government in our response that we needed to see change in that. Again, I’m confident that the way the health sector principles will apply to Pharmac will ensure that that will happen too.

So those were the two points that Mr Watts raised, and then turning now to Ms van Velden, she’s made an assertion that nothing really has changed. Actually, a lot has changed. That might be her cursory reading of things, but the reality is that following the interim report, which really highlighted Pharmac’s inability to perform well when it comes to equity, it was at that point that, given the health sector principles, and the legislation was in the House by that time, it was pretty clear that we could actually address that by bringing Pharmac into the rubric of health entities, which the select committee subsequently did, and I was very supportive of that. So that happened. That will make a significant difference—just requiring Pharmac to satisfy those health sector principles will make a significant difference. So I’m sure that it will.

The member asked how Pharmac will operate with Health New Zealand and the Māori Health Authority. Well, they won’t have a choice, but they will have to, and they will be dealing with formidable organisations. Health New Zealand is a significant organisation. They will have to have a relationship; it’s a working relationship and a constructive one. The Māori Health Authority with its roles as a sort of intellectual policy grunt shop as well as a commissioner of services—it will bring extraordinary insights, and Pharmac will need to incorporate those and actively listen to those as the Māori Health Authority brings their wisdom to bear upon decisions about pharmaceuticals and medicines.

The review makes it very clear that Pharmac should not be solely responsible for strategies for medicines or for rare disorders. That is the role of the ministry, and the ministry will pick that up and it will actively involve Pharmac in that because they will remain the procurement agency. They are a very good procurement agency. They’ve got great capability. It was interesting being at the World Health Assembly last week, with the number of countries that said, “Gee, we wish we had something like a Pharmac.” So there is a lot to be pleased about and proud of with Pharmac, but improvements need to be made, as the review says, and we will ensure that those changes are made.

SIMON O’CONNOR (National—Tāmaki): I’d like to thank the Minister for his contribution. Can he or his officials give me one example of a country in the world, over 25 years, which has replicated the Pharmac model?

SHANAN HALBERT (Labour—Northcote): I move, That the question be now put.

SIMON O’CONNOR (National—Tāmaki): Sorry to leap back to my feet. It is actually quite a genuine question. I think Pharmac is amazing, but having chaired the Health Committee, one of the things that has struck me over that time, and particularly—actually it’s probably over 27 years or so now. Pharmac does many, many things well, but it’s become somewhat of a sacred cow in this country, and I am, I hope, rightly and genuinely asking, Minister, what other country in the world has replicated the Pharmac model?

Hon ANDREW LITTLE (Minister of Health): Just beginning with Mr O’Connor’s point: probably no one, but then no other country is quite like New Zealand, and there’s a multiplicity of different systems. There are countries operating on a State basis and provincial basis, and at a State basis and provincial basis, there are some procurement agencies that operate on that basis where the health system is very much kind of subnational based, but the other thing is that other countries have complex arrangements when it comes to public and private insurance.

So we know that many European countries rely heavily on private insurance or mandated private insurance to meet the cost in whole or in part of pharmaceuticals. When Pharmac agrees to fund a drug, they agree to fund it 100 percent. The cost to the consumer is the prescription charge of $5 each time, up to an annual value of $100. But that’s what sets New Zealand apart from pretty much every other country—that when we agree to fund a pharmaceutical, then we agree to fund it 100 percent. In most other countries it’s at best a partial funding.

I just want to mention one other point too, and that was in relation to consumer engagement—really addressing the point that Mr Watts made. There is a specific requirement in terms of clause 53 where there needs to be a code of consumer and whānau engagement in the health sector. So there is a statutory impetus to make sure that there is consumer engagement.

Dr DEBORAH RUSSELL (Labour—New Lynn): I move, That the question be now put.

BROOKE VAN VELDEN (Deputy Leader—ACT): Thank you, Madam Chair. I just had a query on an area that nobody seems to have picked up on before, and that is about the Hauora Māori Advisory Committee under clause 84. I just had queries about how this operates in practice when it talks in new clause 84A about the Hauora Māori Advisory Committee comprises eight members appointed either “by the Minister on the nomination of all the iwi-Māori partnership boards; or … by the Minister if, and to the extent that, a nomination is not made;”.

So I can understand how you’d end up in a situation where you would want to have the ability as the Minister to self-select because you don’t want positions not to be filled, but, at the same time, the requirement that a nomination is made to be a member of the Hauora Māori Advisory Committee by all of the iwi-Māori partnership boards seems like quite a high threshold. So I’m just curious as to why it’s so specific that it needs all of the iwi-Māori partnership boards to be favourable to a particular person rather than some, or maybe a selection process based on people nominating names in general.

Also: how that kind of works when it comes to the fact that the Hauora Māori Advisory Committee does quite a few things, but, in particular, it can advise the Minister when it comes to maybe deselecting somebody to be on the Māori Health Authority. One area that I’m interested in is maybe a potential conflict of interest where you have the iwi- Māori partnership boards needing to work with the Māori Health Authority to come together to create locality plans, but the people that are on the Māori Health Authority could in some way be deselected by the iwi-Māori partnership boards telling the Minister that maybe they should be advised to replace the person on the Māori Health Authority. I just wondered if I have that correct in my reading, and whether the threshold for the nominations is too high, given that it needs all of the iwi-Māori partnership boards to agree.

Hon ANDREW LITTLE (Minister of Health): The reason this provision is drafted this way is to make sure that the members of the Hauora Māori Advisory Committee represent iwi Māori. Now, we’re not going to have a representative of each iwi on it—it’s going to be a workable number—but in the way that we set up an interim group or a working group in the way my Associate Minister the Hon Peeni Henare and I did when we had Tā Mason Durie advising us, he pulled together a group that advised us on the initial appointments to the interim Māori Health Authority. They sought a mandate from most iwi—not all iwi—but that was a model that largely appeared to work, and the engagement that Peeni Henare had with the Māori community was that that’s what they would like to see in the future.

We need the Hauora Māori Advisory Committee to have the confidence of Māori—iwi Māori and urban Māori—and that’s why that is structured in that way. They know there are six places for iwi Māori. I’m confident that iwi Māori are capable of working it out amongst themselves who the make-up of that group will be and, likewise, the urban Māori organisations that are required to appoint, too.

The role of the Hauora Māori Advisory Committee is to advise me in exercising the powers I have in relation to the Māori Health Authority. That’s a further kind of assurance to Te Ao Māori but also consistent with the Crown’s obligations under the Treaty, and our commitment to partnership is that we work to ensure that the Māori Health Authority—which has such a critical role to play in the health reforms—maintains the confidence of Māori, and these systems, structured this way, are designed to achieve just that.

SIMON WATTS (National—North Shore): Thank you very much, Madam Chair. I appreciate the Minister’s contribution on the last point. I refer to clause 86(3A). It goes into some detail in terms of “When determining appointments to the committee, the Minister must be satisfied … collectively” around the capability and competence and the experience and knowledge and expertise of those on that committee.

My question actually relates somewhat to the point I’ve made previously around Pharmac in terms of the cost-benefit model and the fact that the investment may be made within a health appropriation, but yet the benefit crystallises or is derived or is realised—three words meaning the same thing—outside of the health sphere. When I’m looking through the skill sets of the people within that advisory committee, there is no requirement for anyone with any health economics, financial sustainability, fiscal health, fiscal experience, or any such aspect. Noting that one of the most significant challenges that we have within the healthcare system globally is how to meet the fact that, in effect, demand for healthcare services is infinite and yet funding is finite—quite simply, that lens is important in terms of having that perspective around the table. You know, it can all sound nice in terms of blue-sky thinking of where we should be in terms of outcomes, but the reality is that we can’t achieve everything within that finite health budget.

We saw that come through—and I was fortunate to be part of the Health Committee—when we went through COVID and saw the impacts of COVID on our health system. One of the, I think, learnings which will no doubt be picked up when we review our response—and, of course, we did very well in aspects. But one aspect that I think we could have done better on was in regards to that operationalisation of the policy and clinical policy decisions that were being made such as the aspects around procurement of services, the speed of that procurement, and the fiscal considerations around how we did that. I think that would probably be acknowledged as an area that we could have improved. So this composition here is missing that aspect, and my question to the Minister, quite simply, is why, and what are the reasons for that?

Hon ANDREW LITTLE (Minister of Health): I’m happy to respond, as best I can, to Mr Watts’ question. I think the role of that expert advisory committee on public health is really to deal principally with epidemiological issues and to look at the technical and clinical information coming locally but, more often, from overseas to understand what is happening with our population-based health issues that we need to be addressing, what are the non-communicable diseases that we all struggle to deal with, and the various community interests that go to influence decisions on that. That’s what that committee is really set up for.

I would expect as an ongoing thing that the ministry, which has the broader policy responsibility for health generally and health systems—and bearing in mind that the Public Health Agency will be a discrete body within the ministry—that it’s the ministry that will have economists and other disciplines to bring to bear on this, and, indeed, I expect that Treasury will continue to have health economists as part of the make-up of their workforce, as we expect them to do for their long-term planning around health and the sustainability of health funding. So the broader agencies will have that capability, and we expect the Public Health Agency to be focused on the challenging epidemiological issues of the age.

SHANAN HALBERT (Labour—Northcote): I move, That the question be now put.

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

Ayes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 42

New Zealand National 32; ACT New Zealand 10.

Motion agreed to.

CHAIRPERSON (Hon Jenny Salesa): Brooke van Velden’s amendment to Part 3 set out on Supplementary Order Paper 153 is ruled out of order as being inconsistent with a previous decision of the committee. Debbie Ngarewa-Packer’s amendment to clause 64 set out on Supplementary Order Paper 167 is ruled out of order as being inconsistent with a previous decision of the committee.

A party vote was called for on the question, That Part 3 be agreed to.

Ayes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10, Te Paati Māori 2.

Noes 42

New Zealand National 32; ACT New Zealand 10.

Part 3 agreed to.

Part 4 General

CHAIRPERSON (Hon Jenny Salesa): Members, we come now to Part 4. Part 4 is the debate on clauses 90 to 99, the general provisions, as well as Schedule 2, “Consequential amendments to enactments”, Schedule 5, “Provisions relating to imposition and payment of Ministry levies”, and Schedule 6, “Classes of alcohol and rates of each class”. The question is that Part 4 stand part.

SIMON WATTS (National—North Shore): Thank you, Madam Chair—sorry, Mr Reti, I didn’t see you coming.

Dr Shane Reti: You’re good.

SIMON WATTS: Well, let’s get started on Part 4, and I do just want to refer to clause 95, actually, in regards to the Minister’s approval being required for health entities dealing with land. I’m specifically interested around clause 95(2). As we all know—well, most will know—the reality of health assets, and particularly buildings that DHBs currently lease, is that these are long-term assets. One of the challenges in the current system is the bureaucracy of having to seek ministerial approval to get decisions made for what is routinely operational-type aspects, and I note in this clause that it remains the case that a health entity must not grant a lease or a licence over land for a term of no more than five years without the Minister’s prior written approval.

I guess my question for the Minister in regards to that is what assessment has been done in terms of acknowledging these entities. There’s going to be a huge number of leases—I mean, I can think of within one DHB that I have a reasonable familiarity with, there are hundreds of leases within that one entity alone, and we talked about the Auckland Regional Dental Service, which has dental clinics and other aspects. You know, this is a significant area, so my question to the Minister is what consideration was put around where these thresholds were set, and the cost benefit, I guess, quite simply, in terms of bureaucratic burden placed over the fact that ministerial approval was still going to be required for what here in this case seems to be a relatively routine decision.

The other aspect is in regards to clause 95(1), in regards to the phrase “sell, exchange, mortgage, or charge of land”. I guess in this regard this is also relevant, because a number of health boards across the country own assets and land and buildings that are no longer required for the provision of health services, and a lot of that has a historical legacy aspect. But, again, I can only assume that the role of the Minister of Health is a busy one, and the fact that, again, ministerial approval in writing is going to be required every time that these type of transactions are required, again, just simply looks to me like a bureaucratic burden which could have been avoided with at least, I guess, a little bit of devolved consideration around that. So those are the questions I’ve got in regards to clause 95.

Dr SHANE RETI (National): Thank you, Madam Chair. In Part 4, I have just one small question around clause 97(1)(h), around entitlement cards. As I think about it, the only entitlement cards I can think of are primarily pharmaceutical entitlement cards: the prescription card—up to 20 items—the community services card, maybe, and possibly the super card. So my question is quite short: are there any other entitlement cards that this legislation or that the Minister envisages? Thank you.

BROOKE VAN VELDEN (Deputy Leader—ACT): Thank you, Madam Chair. I just wanted to quickly pick up on an area where I feel like the Minister may be able to be enlightening towards New Zealanders and, in particular, younger New Zealanders, who might be finding that once they turn 18, they’re able to go off to the liquor store and purchase alcohol.

In Part 4, under Subpart 3, “Secondary legislation”, at clause 96, it talks about levies for alcohol-related purposes, so that the ministry is able to recover some of the costs it incurs in the health system by people drinking. Now, I know a lot of New Zealanders do enjoy a good drink on a Friday night or a Saturday night, but the Schedules 5 and 6 apply here, and it actually goes into a little bit of detail on how much levy on every drink that a New Zealander might consume is actually taken in for the purposes of taking up some of the costs that’s incurred on the health sector.

So I just wondered whether the Minister is able to be informative for some of the people who may not realise that when they’re buying something, there’s a levy taken, but also maybe just give a little bit of an example of what sort of alcoholic beverages fall between the maybe 1.15 percent to 2.5 percent versus the 6 percent to the 9 percent, or between 9 percent or 14 percent. Thank you.

Hon ANDREW LITTLE (Minister of Health): Thank you, Madam Chair. Just responding to Ms van Velden’s latest question, I’m not going to go through an account of everybody’s liquor stores to try and gauge exactly what levy might apply. I just simply make the point that the levy provisions in the bill are, in fact, a direct copy of the existing alcohol levy provisions in the current legislation. They are to raise funds for appropriate health promotion because of the harm that the misuse of alcohol causes—and there is a misuse of alcohol consumption, and we have to be able to address it as a major public health issue. I say no more than that.

I’ll do this in reverse order, now that I’ve started with the most recent question asked, and respond to Dr Shane Reti, who asked, in relation to clause 97(1)(h), about the regulations that can be made and specifically in relation to an entitlement card. Again, this is an existing provision that has just been carried over from legislation and put into this bill. I would say that this is simply futureproofing the health system in case we want to introduce a method of recording information for people, that we can record that information that way, and that information is stored on a card as the basis for people to get access to whatever it is—a service, or medications, or what have you. So it’s just being sure that there is statutory authority to be able to use that technology and use information and store it in that particular way.

Then turning to Mr Watts’ questions about clause 95(2) and (1)—in that order. I get the member’s point that given the amount of land that hospitals occupy—and their use is going to change over time. I get that. But I think the important thing is he is probably right that this is sort of a historical throwback. It’s never really been amended to change from an organisation with a turnover of anywhere between $400 million and maybe $1 billion, to an organisation that will have a turnover of closer to $18 billion to $20 billion and a workforce of about 82,000. It’s well worth considering in the five-year review that is provided for in the legislation here. But I think the underlying premise was that land that is held by the Crown for health services and used for health services—you want to make sure that it continues to be available for that purpose, even if for a period of time it might be used for some slightly different purpose and to raise some revenue as an alternative.

I should add, as I understand it, the Minister’s powers in this regard can be delegated—most likely delegated to the director-general, who would then further delegate it to an appropriate senior official. It’s possibly even capable of being delegated to Health New Zealand. But it’s an old-fashioned protection—if I could use that term in that way—that, perhaps, when the legislation comes up for review in five years, this is something that could be looked at then.

SHANAN HALBERT (Labour—Northcote): I move, That the question be now put.

CHRIS PENK (National—Kaipara ki Mahurangi): Thank you very much, Madam Chair. I’ve been watching the debate remotely, so to speak, and can I just say it seems to me an excellent discussion in the committee, so I’m grateful to everyone who’s contributed. My own contribution will be obviously limited to Part 4, because this is where we are now, and reasonably narrow and won’t be unduly lengthy, actually. But I do just want to engage with the Minister, at least briefly, on some of the regulation-making powers within the bill. I acknowledge that the Minister has a legal background, as well as the fact that he holds a particular portfolio in the health space that relates to the substance of the bill.

But from a legal perspective and, I suppose, wearing my hat as the enthusiastic chair of the Regulations Review Committee, notwithstanding that committee hasn’t yet considered this matter, just in terms of the way that the regulation-making powers are provided in clause 97, I suppose I might characterise my contribution as an encouragement to the Minister to provide as much detail as possible. We may be beyond the point of no return in terms of what’s actually in the legislation at this point, but any guidance he can give, or thoughts, will be helpful for the record.

So, for example, the Governor-General may by Order in Council—in other words, the executive government, essentially—make regulations to do with regional arrangements. I think it might be helpful, in the making of the regulations, if not in the regulation-making power within the bill, for a bit of a rationale to be provided. So the regional arrangements through which Health New Zealand and the Māori Health Authority must provide and arrange services, I think it would be helpful if those regulations specified that their purpose is, for example, to avoid a postcode lottery approach to health. More eloquent language, no doubt, would be used for that, but no doubt those listening will know what’s intended by that. I expect every member of the House would be anxious that we have a health system that doesn’t make a lottery of a person’s place of residence within New Zealand. So, I think, at that high level, we’re all on the same page here. So can I encourage the Minister and his officials, when they’re making those regulations, to be quite clear about the reason that those are going to need to be made, because that will be the yardstick against which their effectiveness is able to be measured.

Similarly, in relation to the next subheading—in italics, for those who are fortunate enough for them to have the bill in front of them—“Information to be supplied by health entities”. So the information to be specified and to be provided to the director-general would include the manner in which it’s to be provided. A bit more detail there might be helpful—for example, the frequency of such information being provided, the requirement of it being released maybe proactively on a publicly accessible Government website, and so forth. If I could just give an example, actually, where I think there is a bit of helpful detail later on, under the heading of New Zealand Health plan, we’ve got the imposition of procedural requirements, including engagement requirements for consultation. So I think that’s an example, actually, where there is a helpful level of detail in the legislation under that.

And then, finally, in the remaining time within this slot—I should highlight that I don’t expect the Minister to engage in detail on each one of these, but just to give a general flavour of my thoughts around the fact that more detail, rather than less, would be helpful—under the heading of “Dispute Resolution”, clause 97(1)(p), “for the purpose of section 28 [elsewhere in the bill], prescribing procedural matters and requirements”. So I think some examples there, and certainly it would be helpful to have those dispute resolution mechanisms—for example, it might be that the system should prioritise the timely resolution of such disputes. Of course, generally the dictates of justice require timeliness, and, I can only imagine, in the context of contested healthcare provision, it would be particularly important for the mental health, if nothing else, of those involved to have these issues dealt with more rapidly than is, for example, in the judicial branch of Government more generally.

So those are my thoughts and comments. Any response that the Minister can provide would be gratefully received. Otherwise, please take it as read that we will look carefully and with interest at the regulations that eventually flow from this primary legislation.

Hon ANDREW LITTLE (Minister of Health): Thank you, Madam Chair, and I thank Chris Penk. For a minute there, I thought he was going to say that they were going to vote for the bill, but that’s too much to hope for. I want to correct the member, too. I know he refers to the Regulations Review Committee. It is known around are here as “the all-powerful Regulations Review Committee”, because we all bow to it. It’s very important, a very authoritative committee, and one that I thoroughly enjoyed serving on for a period of time. No, it is important, and it’s important that it’s chaired by somebody with considerable capability, as indeed, that member reflects, as he sits in his chair—it must be late at night!

The member has invited a general response as opposed to a detailed response, although I’m tempted to give a detailed response. I think that the member makes good points, as usual, and he makes the point about the extent that regional arrangements are provided for. And that reflects, I think, an expectation that Health New Zealand and, in fact, the Māori Health Authority, because they’ve now said this, have a regional element to their structure. And the regional division, if you like, will be quite important. They’re going to make commissioning decisions, and so it would be appropriate, for the sake of transparency and accountability, that there is some clear regulation about that, so the member can expect to see something in that respect in due course.

Although there will be a regional level of organisation, the member is right. The whole purpose of the legislation is to try to get rid of the postcode lottery that we’ve got—I suppose what I would say is the unnecessary and unjustified variation in terms of health services. But, of course, the other part, and locality planning will drive this, is we do want some tailoring of services as communities ask for it and want it and need it. So there will be some variation, but that will be variation that is justified and warranted.

I accept the member’s point about when it comes to information being provided, it is to be as specific as possible about that. Again, that’s in the interests of transparency.

The dispute resolution provision there relates to disputes between Health New Zealand and the Māori Health Authority to the extent that dispute resolution will need to be regulated. Again, that’s for the sake of various parties so they know what the rules of engagement are in the event that there is a dispute that can’t be resolved in a more informal sort of way, but my expectation is that that will be possible. But I thank the member for his contribution.

BROOKE VAN VELDEN (Deputy Leader—ACT): Thank you, Madam Chair. I had a question that related to Part 4, clause 93, and it’s about the director-general requiring information from health entities. It says that “(1) For the purpose of monitoring the performance of any health entity or the health sector in general, the Director-General may, in writing,—(a) request from a health entity, information in relation to any matter; and (b) specify a time frame by which the health entity must comply with the request.” It also says that “(3) The Director-General must not request under this section any personal health information of any identifiable person.”

I think that’s important, but I also wanted to give the Minister a chance to explain to people or provide a bit more context, because I know a lot of New Zealanders do worry about the privacy of their information. They worry about their names, their details, and their health records being put on registers, and somehow this information not necessarily being leaked but being deposited in an area that it was never expected to. We do note that with the Waikato DHB is an example where there was a privacy breach, but I also think of a range of other different registers, and I know that a lot of New Zealanders do have an issue with Governments holding their own data and whether or not they feel like that data should be shared.

So is there in any other part of the health sector, or in any processes or requirements in place within the entities themselves, the ability to hold and store this information or processes to help with the transfer of information to the Director-General of Health where that information about that person won’t be personally identifiable, because I know that this is an issue that has cropped up time and time again with people who don’t trust Government departments—people who do have vulnerable health conditions not wanting that to be public in any way. So if the Minister could shed a little light on how this process would actually work in effect. Thank you.

Hon ANDREW LITTLE (Minister of Health): Madam Chair, thank you, and I thank the member for raising that question. That is a very big question that not just public health entities deal with but private as well. I think the single biggest compromise of health data we had was actually a private health provider. It was a primary health organisation where the health records of a million patients were potentially compromised through an encroachment by a bad actor. Upon investigation, it was found more likely than not that information wasn’t exfiltrated, but certainly the person who compromised the system had the opportunity to do so over a considerable period of time. And then you’ve got the situations like the Waikato District Health Board, where a ransomware attack happens and data is exfiltrated and is placed on the dark web. So those are real things that have happened. That really highlights the need for high-quality IT systems, and that’s why we’ve invested nearly half a billion dollars in upgrading and renewing health IT systems, but also the need for high-quality data security and cyber-security.

I think to the extent that clause 93 signals anything, it is that we do respect the need for a high degree of confidentiality and respect for the confidentiality of personal health information. It is important for the Director-General—as the head of the ministry, which is the steward of the system and needs good information to understand what’s going on—to get information, but not in a way that identifies individuals, so that individual patients can be sure that their personal health details are not being placed in data storage or data systems somewhere that people unknown to the patient could get access to them.

One of the challenges we’ve got and we’re working with—and I think most members of the House would agree—is that of health information. We want patient health information to be available to health practitioners who are authorised to have access to it—authorised by patients—at a time when it makes sense to. So we want to build a system where if a patient agrees, then whichever health practitioner they’re turning up to—whether it’s somebody in a hospital, somebody in their GP practice, or, if they’re out of town, an after-hours practice somewhere—that health practitioner can get that person’s health information to fully understand the health profile of that person.

A system that can do that has been sought for a long time. That is the system that we’re trying to create. It’s what the health sector says will make such a big difference in terms of health service provision and preventing the need for patients to tell their story multiple times, particularly if they are a patient seeking treatment, for example, for a traumatic injury or a traumatic violent injury or an injury incurred as a result of a violent act. Patients in that situation seldom want to repeatedly tell their story, because just telling it can be traumatising. So the more that we can do to ensure that the trusted health practitioner in front of a patient can get the right information so that health practitioner can give the best possible advice and treatment—that is where we want to get to, but it has to be done in a way that is respectful of the patient’s privacy rights. That’s the system that we’re trying to build.

KAREN CHHOUR (ACT) (remote): Thank you, Madam Chair. Just a quick question around privacy with information: as we’ve seen, this has been an issue in the past when it came to vaccinations with Māori and Māori information being wanted when it comes to finding out who needed to be vaccinated. I’m just wondering how will people’s health information be held under these two authorities, and will there be a choice of where Māori hold their information, or will that just be shared automatically?

Hon ANDREW LITTLE (Minister of Health): I thank Ms Chhour for her question. I think she can expect that patient information will be held by health organisations who gather that information from the patient, because that clearly will have been imparted by the patient and the patient would expect that health provider to hold it.

Information will not be passed on to any other health provider unless that has been consented to by the patient. So if there is a referral, ordinarily a patient would be asked to and required to give their consent to pass that on. That said, we know that from every patient transaction there is relevant data that is useful in the aggregate as we think about health planning and the incidence of infections and non-communicable diseases and all the rest of it. So we do need a system that can gather data on an anonymous basis, so that anonymised aggregate data can be provided to appropriate agencies as they do the health planning and the long-term planning for the sort of health services that might be needed, and the long-term aggregate data, too, that will assist in locality planning and more localised service provision. To the extent that the member is seeking reassurance about the safety and security of personal information, information will be held only by health providers that have been authorised by the patient to hold it.

BARBARA EDMONDS (Associate Whip—Labour): I move, That the question be now put.

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

Ayes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 42

New Zealand National 32; ACT New Zealand 10.

Motion agreed to.

CHAIRPERSON (Hon Jenny Salesa): The question is that the Minister’s amendment to Part 4 set out on Supplementary Order Paper 169 be agreed to.

Amendment agreed to.

CHAIRPERSON (Hon Jenny Salesa): Debbie Ngarewa-Packer’s amendments to Part 4 set out on Supplementary Order Paper 167 are ruled out of order as being inconsistent with a previous decision of the committee.

Brooke van Velden’s amendments to Part 4 set out on Supplementary Order Paper 153 are ruled out of order as being inconsistent with a previous decision of the committee.

A party vote was called for on the question, That Part 4 as amended be agreed to.

Ayes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 42

New Zealand National 32; ACT New Zealand 10.

Part 4 as amended agreed to.

Schedule 1

CHAIRPERSON (Hon Jenny Salesa): The question is that the Minister’s amendments to Schedule 1 set out on Supplementary Order Paper 169 be agreed to.

Amendments agreed to.

CHAIRPERSON (Hon Jenny Salesa): Brooke van Velden’s amendments to Schedule 1 set out on Supplementary Order Paper 153 are ruled out of order as being inconsistent with a previous decision of the committee.

Brooke van Velden’s amendment to Schedule 1 relating to a rural health strategy set out on Supplementary Order Paper 151 is ruled out of order as being the same in substance as a previous amendment.

Brooke van Velden’s amendment to Schedule 1 set out on Supplementary Order Paper 152 is ruled out of order as being inconsistent with a previous decision of the committee.

Dr Elizabeth Kerekere’s amendment to Schedule 1 set out on Supplementary Order Paper 154 is ruled out of order as being inconsistent with a previous decision of the committee.

Dr Shane Reti’s amendment to Schedule 1 set out on Supplementary Order Paper 157 is ruled out of order as being inconsistent with a previous decision of the committee.

Dr Shane Reti’s amendment to Schedule 1 set out on Supplementary Order Paper 158 is ruled out of order as being inconsistent with a previous decision of the committee.

Matt Doocey’s amendment to Schedule 1 set out on Supplementary Order Paper 170 is ruled out of order as being inconsistent with a previous decision of the committee.

Debbie Ngarewa-Packer’s amendment to Schedule 1 set out on Supplementary Order Paper 167 is ruled out of order as being inconsistent with a previous decision of the committee.

A party vote was called for on the question, That Schedule 1 as amended be agreed to.

Ayes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 42

New Zealand National 32; ACT New Zealand 10.

Schedule 1 as amended agreed to.

Schedule 1A

A party vote was called for on the question, That Schedule 1A be agreed to.

Ayes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 42

New Zealand National 32; ACT New Zealand 10.

Schedule 1A agreed to.

Schedule 2

CHAIRPERSON (Hon Jenny Salesa): The question is that the Minister’s amendments to Schedule 2 set out on Supplementary Order Paper 169 be agreed to.

Amendments agreed to.

CHAIRPERSON (Hon Jenny Salesa): Brooke van Velden’s amendments to Schedule 2 set out on Supplementary Order Paper 153 are ruled out of order as being inconsistent with a previous decision of the committee.

Debbie Ngarewa-Packer’s amendments to Schedule 2 set out on Supplementary Order Paper 167 are ruled out of order as being inconsistent with a previous decision of the committee.

A party vote was called for on the question, That Schedule 2 as amended be agreed to.

Ayes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 42

New Zealand National 32; ACT New Zealand 10.

Schedule 2 as amended agreed to.

Schedule 3

A party vote was called for on the question, That Schedule 3 be agreed to.

Ayes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 42

New Zealand National 32; ACT New Zealand 10.

Schedule 3 agreed to.

Schedule 4

A party vote was called for on the question, That Schedule 4 be agreed to.

Ayes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 42

New Zealand National 32; ACT New Zealand 10.

Schedule 4 agreed to.

Schedule 5

CHAIRPERSON (Hon Jenny Salesa): The question is that the Minister’s amendments to Schedule 5 set out on Supplementary Order Paper 169 be agreed to.

Amendments agreed to.

A party vote was called for on the question, That Schedule 5 as amended be agreed to.

Ayes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 42

New Zealand National 32; ACT New Zealand 10.

Schedule 5 as amended agreed to.

Schedule 6

A party vote was called for on the question, That Schedule 6 be agreed to.

Ayes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 42

New Zealand National 32; ACT New Zealand 10.

Schedule 6 agreed to.

Clauses 1 and 2

CHAIRPERSON (Hon Jenny Salesa): Members, we come now to our final debate. This is the debate on clauses 1 and 2, the title and commencement debate. The question is that clauses 1 and 2 stand part.

Dr SHANE RETI (National): Thank you, Madam Chair. I rise to speak to Supplementary Order Paper 161, in my name, and on behalf of the National Party. This Supplementary Order Paper seeks to change the title of the bill to describe what it functionally does, which, by its own description, is to centralise healthcare.

I now want to talk about centralising healthcare in this manner. We have significant concerns with centralising healthcare, as this bill and these reforms do. Quite simply, it is command and control by a socialist, Labour Government not happy with centralising polytechnics and ruining that sector, and not happy with centralising three waters and ruining local government; now, they want to centralise healthcare and will ruin that—all underpinned by a theme of “Wellington knows best.” Well, guess what! They don’t know best. Local people know what is best for them.

Ask yourself this: do these reforms increase or decrease elected democracy? By removing elected district health board (DHB) members these reforms, and this Government, arrogantly dismisses the rule of democracy and the voice of elected people. By removing elected officials and saying they never really made a contribution disrespects what the Parliamentary Library tells me are the nearly 1,001 people over 20 years who have been voted in by communities. I want to thank all of those elected people who put themselves forward and made a contribution; it was valued.

In 2001, the British Medical Journal described the reforms that brought about DHBs, and the Labour Government that did it, as working to achieve the goals of “a system promoted as allowing greater community voice in health sector decision-making” and “putting the public back into the public health system”. What these reforms do is put bureaucracy back into the health system. What these reforms do is take the public out of the public health system. Decentralisation of healthcare by this bill will put layers and layers of bureaucracy between patients and the Minister: a national commissioner, four regional commissioners, four to five district locality commissioners, 80 localities, and then providers, and then patients—more money, more bureaucracy, and worse outcomes. Centralising healthcare in the middle of a pandemic, when New Zealanders are dying every single day, is a reform that will fail, that deserves to fail, and will see this Government out of office.

The question I’d then pose: how does the Minister explain the removal of the democratically elected local people, and is democracy enhanced or diminished by this bill? Thank you.

MATT DOOCEY (National—Waimakariri): Thank you very much, Madam Chair. Look, I must admit I did take a bit of time out of the debate. So I just wanted to check back in and see if the Government had backtracked on any other parts of the bill, since they told us they weren’t going to have a rural strategy. But we heard from the Minister tonight that, a few weeks after the select committee, where the Labour MPs sat on their hands and didn’t say anything, he spoke to one of his Labour rural MPs and they said, “Hey, have you thought about putting a rural health strategy in?” And the Minister said, “Great idea! I haven’t heard of that.—even though I’ve been in the media saying we’re not going to do that.” It might have been the morning after a poll, I think—the morning after.

But well done to rural New Zealanders for standing up and having a voice, because rural New Zealanders know that, under this bill, their voice will be taken away because bureaucrats in Wellington will be deciding healthcare in rural and regional New Zealand. And do you know why the Government backtracked on the rural health strategy? It’s because the rural Labour MPs squealed; they felt the pressure of their constituents. And we got told in the House it was Labour that stood up for rural New Zealand. In fact, it was actually the Opposition that got this win over the line tonight.

This is emblematic of this failed socialist experiment that wants to centralise time and time again—polytech mergers, three waters, now we’ve got healthcare, and they think that if you just get the title and you just put the word “healthy” in it, that will make a difference. Because, if you say, “healthy”, it must be healthy! A bit like fair pay. If you say “fair pay”, it must be fair pay! And then they think, “Well, if you say ‘healthy’ and just throw money at it”—billions of dollars. But here they were; they invested $1.9 billion—or they announced $1.9 billion; I’m not sure they actually put it in. They announced $1.9 billion and the report came back, the scorecard, and said, “No material improvement, for $1.9 billion.” Now they’re saying, “Let’s put more money into health, and trust us. We will make a difference.” The Minister could never state, through this whole process, one health outcome that would be improved in the first 12 months. So how do we have “healthy” in the title when you can’t name one health outcome that will be improved in the first 12 months?

And what is the real kick in the guts by this bill, in the final debate tonight? I think this Government needs to apologise to the thousands of vulnerable Kiwis that turned up to their mental health inquiry, told their traumatic and often personal stories; and yet they turn up and we’ve got a once-in-a-generation health restructure and they wouldn’t put a mental health, addictions, and wellbeing strategy in. But the submitters called for it. The Mental Health and Wellbeing Commission said mental health was invisible in this bill. The Mental Health Foundation said not having mental health in it demonstrated the Government’s lack of commitment to transforming the mental health system. Every mental health submitter turned up and said, “If this bill is about health, if this bill is about equity, then it’s equity when it suits them. What about the population group that has one of the most serious health inequalities: mental health?” People with mental health die 20 years shorter than the average Kiwi. Do we hear of a mental health and wellbeing strategy in this bill? No, because Labour knows best!

They will centralise the health system. They know best! Their bureaucrats know best! And that’s why people in regional and rural New Zealand know exactly what is going to happen, because bureaucrats in Wellington don’t know what’s best for regional and rural New Zealand. And well done them for sticking up tonight and making sure their voices were heard, because what it was tonight was electoral pressure; electoral pressure on this Government that’s waking up that people are realising they are not doing what they want. And well done to the Opposition for sticking up for regional and rural New Zealanders.

BROOKE VAN VELDEN (Deputy Leader—ACT): Thank you, Madam Chair. It’s a pleasure to take a call on behalf of the ACT Party on the title and commencement clauses. This bill should not be called the Pae Ora (Healthy Futures) Bill. I’ve got two options for what this bill should be called.

Number one, we should rename this bill to be called the “Co-governance Bill”, because that’s what it is. This health reform is not a health reform; it is an exercise in co-governance rather than in health needs and better health outcomes for New Zealanders. The second amendment that I would make to this is to call it the “Democracy is Different in New Zealand Bill”, because that is what the Ministers in this Chamber have said. They’ve said publicly that democracy is different in New Zealand. I think that’s a disgrace, and it should be front and centre. Rather than being called the Pae Ora (Healthy Futures) Bill, it actually should say what it is: that this Government doesn’t believe that healthcare should be put at the centre of our health reform; co-governance should be put at the centre of our health reform. This bill should have asked the question: how do we get better access to more treatments, to more New Zealanders, faster? This bill is adding bureaucracy to our healthcare system. It will make it harder for New Zealanders to get access to healthcare, because it’s focusing on the wrong problem. It’s focused on co-governance and changing the definition of democracy in New Zealand rather than on focusing on patients.

Now, the ACT Party put forward three amendments to this legislation, and we’re happy to see that the Government has taken up one of them, and that was an amendment in my name for a rural health strategy. I want to congratulate the Minister for recognising, at the last minute, that he had forgotten about rural New Zealand and forgotten about the rural population’s health needs. I think it’s important that the rural health strategy was put in this bill, and I hope it goes some way to acknowledging the difficulties that rural New Zealanders face getting adequate health outcomes and adequate health access.

One aspect that I think has been missed over is the need for a medicines strategy. That was another amendment that we put forward tonight. The Pharmac final review came back and said that for Pharmac to be truly integrated into the new health system, there was a desperate need for a medicines strategy to underpin it. Now, we had this amendment ready to go, the Minister could have taken it up, and it’s a shame he didn’t. I think he didn’t take it up, because, like he forgot about rural New Zealand, he forgot about patients and forgot about medicines access. You cannot reform the healthcare sector if you don’t talk about medicines access. It’s shameful in New Zealand. We have hundreds of people who don’t get adequate care and don’t get the funding for the drugs that they need to live long, productive, and healthy lives. We can, and we should, do better, and that’s why I think it’s important that we should have had a medicines strategy.

We also had an amendment to remove the Māori Health Authority, and that goes back to why I think this bill should be called the “Co-governance Bill” or the “Democracy is Different in New Zealand Bill”, because we are going down a divisive path of going through the three waters reforms, the healthcare reforms, and putting in place divisive policies that base people in New Zealand on their race rather than on their needs, and rather than on good structures, and I think that’s shameful. So I hope anybody would support me in saying that this bill shouldn’t be called the Pae Ora (Healthy Futures) Bill; it’s should be called the “Co-governance Bill” or the “Democracy is Different in New Zealand Bill”. We need more transparency about what this Government is actually doing. We need to put patients back at the heart of the healthcare sector. We need better medicines access, for more people, faster. We need better treatments, for more New Zealanders, faster. We need to look out for those rural New Zealanders, who are so often overlooked by this Government, and I am proud that the ACT Party forced the Government into putting the rural health strategy at the heart of this legislation.

CHAIRPERSON (Hon Jenny Salesa): I call on Joseph Mooney, although I warn you that this will be a very short call because I have to report progress at five to 10.

JOSEPH MOONEY (National—Southland): Thank you, Madam Chair. I just wanted to speak to the name of this bill, the Pae Ora (Healthy Futures) Bill. I wanted to ask the Minister whose futures his Government was thinking about. The biggest population group after Auckland and Christchurch in New Zealand is rural New Zealand, and yet only tonight has the Minister thought of a rural health strategy. I mean, this is shocking and it speaks to rural New Zealand who feels his Government has left them behind and forgotten about them. It’s actually incredible—

CHAIRPERSON (Hon Jenny Salesa): Apologies to the member. I have to report progress now.

Progress to be reported.

House resumed.

CHAIRPERSON (Hon Jenny Salesa): Mr Speaker, the committee has considered the Pae Ora (Healthy Futures) Bill and reports progress. I move, That the report be adopted.

A party vote was called for on the question, That the report be adopted.

Ayes 77

New Zealand Labour 65; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 42

New Zealand National 32; ACT New Zealand 10.

Motion agreed to.

Report adopted.

DEPUTY SPEAKER: Members, this bill is set down for further consideration in committee next sitting day. The House stand adjourned until tomorrow at 2 p.m. Tofa soifua. Manuia le po.

The House adjourned at 9.56 p.m.